| Item 7.01 | Regulation FD Disclosure. |
Financings
On November 7, 2022, Spirit AeroSystems Holdings,
Inc. (the “Company”) issued press releases announcing that Spirit AeroSystems, Inc., the Company’s direct wholly-owned
subsidiary (“Spirit”), (1) intends to offer senior secured first lien notes to qualified institutional buyers pursuant to
Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in accordance
with Regulation S under the Securities Act, and (2) has commenced an offer to purchase for cash any and all of the $500 million outstanding
principal amount of its 5.500% Senior Secured First Lien Notes due 2025 (the “2025 First Lien Notes”) and to solicit consents
to amend certain provisions of the indenture relating to the 2025 First Lien Notes to eliminate certain restrictive covenants and certain
events of default and to release all of the collateral. Copies of the press releases are attached hereto as Exhibits 99.1 and 99.2, respectively,
and are incorporated herein by reference.
In addition, on November 7, 2022, the Company plans to meet with prospective
lenders to discuss a proposed refinancing of Spirit’s existing term loan B credit facility. During those meetings, the Company plans
to update and supplement certain disclosures, as described herein.
EBITDA and Adjusted EBITDA
The Company plans to present EBITDA and Adjusted EBITDA (each as defined
below) in connection with its meetings. EBITDA and Adjusted EBITDA are not calculated in accordance with U.S. generally accepted accounting
principles (“GAAP”) and should not be considered as a substitute for net (loss) income or any other measure calculated in
accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies.
The Company believes that the presentation of EBITDA and Adjusted EBITDA
is appropriate to provide additional information to investors about its operating profitability adjusted for certain non-cash items and
other gains and expenses that the Company believes are not part of its core operating business and are not an indication of the Company’s
future earnings performance.
The Company defines “EBITDA” as net (loss) income adjusted
for equity in net income (loss) of affiliates, income tax (benefit) provision, other (income) expense, net, interest expense and financing
fee amortization, depreciation and amortization expense and amortization expense. The Company defines “Adjusted EBITDA” as
EBITDA plus or minus certain non-cash or non-recurring items, including (i) employee stock based compensation expense, (ii) forward-loss
charges, (iii) cumulative catch-up adjustments, (iv) loss on disposition of assets, (v) Russian sanctions (excluding forward losses), (vi) M&A-related
expenses and (vii) restructuring costs. Management believes that excluding these non-cash or non-recurring items provides a better understanding
of the underlying trends in the Company’s operating performance and allows more accurate comparisons of the Company’s operating
results to historical performance. Adjusted EBITDA does not take into account certain significant items that directly affect the Company’s
net income or loss. These limitations are best addressed by considering the economic effects of the excluded items independently, and
by considering Adjusted EBITDA in conjunction with net income as calculated in accordance with GAAP.
The Company’s EBITDA
and Adjusted EBITDA for the nine months ended September 29, 2022 and September 30, 2021, the twelve months ended September 29, 2022 and
the years ended December 31, 2021, 2020 and 2019 are set forth below.
| |
Nine Months Ended | | |
Twelve
Months
Ended | | |
| |
| |
September 29, | | |
September 30, | | |
September 29, | | |
Year Ended December 31, | |
| |
2022 | | |
2021 | | |
2022 | | |
2021 | | |
2020 | | |
2019 | |
| |
| | |
| | |
| | |
| | |
| | |
| |
| |
(in millions) | |
EBITDA | |
| 111.3 | | |
| (137.9 | ) | |
| 119.6 | | |
| (129.6 | ) | |
| (536.7 | ) | |
| 1,000.6 | |
Adjusted EBITDA | |
| 346.4 | | |
| 93.6 | | |
| 370.7 | | |
| 159.8 | | |
| 19.1 | | |
| 1,139.4 | |
The
following table reconciles net (loss) income to EBITDA and Adjusted EBITDA:
| |
Nine Months Ended | | |
Twelve
Months
Ended | | |
| |
| |
September 29, | | |
September 30, | | |
September 29, | | |
Year Ended December 31, | |
| |
2022 | | |
2021 | | |
2022 | | |
2021 | | |
2020 | | |
2019 | |
| |
| | |
| | |
| | |
| | |
| | |
| |
| |
(in millions) | |
Net (loss) income | |
$ | (302.6 | ) | |
$ | (420.5 | ) | |
$ | (422.9 | ) | |
$ | (540.8 | ) | |
$ | (870.3 | ) | |
$ | 530.1 | |
Add (subtract) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Equity in net income (loss) of affiliates | |
| 1.2 | | |
| 1.9 | | |
| 2.1 | | |
| 2.8 | | |
| 4.6 | | |
| 0.2 | |
Income tax (benefit) provision | |
| 18.4 | | |
| (0.6 | ) | |
| 1.8 | | |
| (17.2 | ) | |
| (220.2 | ) | |
| 132.8 | |
Other (income) expense, net | |
| (30.2 | ) | |
| (138.7 | ) | |
| (38.1 | ) | |
| (146.6 | ) | |
| 77.8 | | |
| 5.8 | |
Interest expense and financing fee amortization | |
| 170.8 | | |
| 177.7 | | |
| 235.7 | | |
| 242.6 | | |
| 195.3 | | |
| 91.9 | |
Operating (loss) income | |
$ | (142.4 | ) | |
$ | (380.2 | ) | |
$ | (221.4 | ) | |
$ | (459.2 | ) | |
$ | (812.8 | ) | |
$ | 760.8 | |
Depreciation and amortization expense | |
| 253.2 | | |
| 241.9 | | |
| 338.9 | | |
| 327.6 | | |
| 277.6 | | |
| 251.7 | |
Amortization expense(a) | |
| 0.5 | | |
| 0.4 | | |
| 2.1 | | |
| 2.0 | | |
| (1.5 | ) | |
| (11.9 | ) |
EBITDA | |
$ | 111.3 | | |
$ | (137.9 | ) | |
$ | 119.6 | | |
$ | (129.6 | ) | |
$ | (536.7 | ) | |
$ | 1,000.6 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Adjustments to EBITDA | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Employee stock based compensation | |
| 28.7 | | |
| 19.6 | | |
| 34.9 | | |
$ | 25.8 | | |
$ | 24.2 | | |
$ | 36.1 | |
Forward-loss charges | |
| 136.6 | | |
| 195.0 | | |
| 183.1 | | |
| 241.5 | | |
| 370.3 | | |
| 63.5 | |
Cumulative catch-up adjustments | |
| 26.2 | | |
| 2.5 | | |
| 28.7 | | |
| 5.0 | | |
| 30.4 | | |
| 2.0 | |
Loss on disposition of assets | |
| 0.8 | | |
| 2.3 | | |
| 2.6 | | |
| 4.1 | | |
| 26.4 | | |
| 4.9 | |
Russian sanctions (excluding forward losses) | |
| 41.9 | | |
| — | | |
| 41.9 | | |
| — | | |
| — | | |
| — | |
M&A-related expenses | |
| 0.7 | | |
| 4.0 | | |
| 1.5 | | |
| 4.8 | | |
| 31.5 | | |
| 32.3 | |
Restructuring costs | |
| 0.2 | | |
| 8.1 | | |
| 0.3 | | |
| 8.2 | | |
| 73.0 | | |
| — | |
Adjusted EBITDA | |
$ | 346.4 | | |
$ | 93.6 | | |
$ | 412.6 | | |
$ | 159.8 | | |
$ | 19.1 | | |
$ | 1,139.4 | |
(a)
Includes
accretion of customer supply agreement and grant liability amortization.
The information contained under this Item
7.01 in this Current Report on Form 8-K, including Exhibits 99.1, 99.2 and 99.3, is being furnished and, as a result, such information
shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), or subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing
under the Securities Act, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
This Current Report on Form 8-K does not constitute
an offer to sell or the solicitation of an offer to buy, or an offer to purchase or a solicitation of an offer to sell, any security and
shall not constitute an offer, solicitation or sale of any security in any jurisdiction in which such offering, solicitation or sale would
be unlawful.