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Spirit AeroSystems Holdings, Inc. Reports Third Quarter 2009 Financial Results; Financial Guidance
WICHITA, Kan., Nov. 5 /PRNewswire-AsiaNet/ -- Reports Revenues of US$1.054 Billion and 12.4% Operating Margins; Updates 2009
- Third quarter 2009 Revenues grew 3 percent to US$1.054 billion
- Operating Income grew 18 percent as Operating Margins expanded to 12.4 percent
- Fully Diluted Earnings Per Share increased 17 percent to US$0.62 per share
- Cash and Cash Equivalents were US$207 million
- Total backlog of approximately US$28.2 billion
Spirit AeroSystems Holdings, Inc. (NYSE: SPR | Quote | Chart | News | PowerRating) reported third quarter 2009 financial results reflecting revenue and earnings growth as ship set deliveries for large commercial aircraft increased from the same period of 2008.
Spirit's third quarter 2009 revenues increased to US$1.054 billion, up 3 percent from the same period last year. Operating income increased 18 percent to US$131 million, up from US$111 million in the same period a year ago, as revenues increased, operating efficiencies improved, and period expense declined. Net income was US$87 million, or US$0.62 per fully diluted share, up 18 percent from US$74 million, or US$0.53 per fully diluted share, in the same period of 2008.
"We executed well across the company as we delivered solid operating performance in the third quarter," said President and Chief Executive Officer Jeff Turner. "Our results reflect improving performance as revenues and profitability increased and we recovered from the disrupted operations in the previous three quarters caused by the Machinists' strike at Boeing and the new ERP system implementation in the first half of 2009," Turner stated. "We continue to support the 787 program and are preparing for production restart and ramp-up. In addition, we continue to make good progress on other development programs as we work to grow and diversify our company," Turner added.
"While we have seen some stabilization in the global economic outlook, we remain cautious regarding the outlook of the commercial aerospace market. Our backlog remains strong and our strategy is on track to achieve long-term value creation for our customers, shareholders, and employees," Turner concluded.
Spirit's backlog at the end of the third quarter of 2009 was $28.2 billion, flat from the end of the second quarter of 2009, as Airbus and Boeing third quarter backlog reductions were offset by a follow-on contract at Spirit Europe for 777 wing components. Spirit calculates its backlog based on contractual prices for products and volumes from the published firm order backlogs of Airbus and Boeing, along with firm orders from other customers.
Spirit updated its contract profitability estimates during the third quarter of 2009, resulting in a $2 million favorable cumulative catch-up adjustment, compared to a $13 million unfavorable cumulative catch-up adjustment for the third quarter of 2008, which was largely the result of the Machinists' strike at Boeing.
Cash flow from operations was $5 million for the third quarter of 2009, compared to $68 million for the third quarter of 2008, primarily due to a decrease in cash advance receipts from customers of $48 million compared to the same period of 2008.
During the third quarter, Spirit issued $300 million in senior unsecured notes with a coupon rate of 7.5% and a maturity in 2017. A portion of the proceeds were used to pay down the outstanding revolver balance of $200 million prior to the close of the third quarter.
Cash balances at the end of the third quarter of 2009 were $207 million and debt balances were $884 million. During the third quarter of 2009, the company utilized its credit-line as it continued to invest in development programs. All credit-line borrowings were paid down using a portion of the funds from the issuance of the senior unsecured notes. At the end of the third quarter of 2009, the company's $729 million revolving credit facility was undrawn. Approximately $17 million of the credit facility is reserved for financial letters of credit.
The company's credit ratings remained unchanged at the end of the third quarter of 2009 with a BB rating at Standard & Poor's and a Ba3 rating at Moody's.
2009 Outlook
Spirit revenue guidance for the full-year 2009 has been updated to reflect movement of certain forecasted non-recurring contract settlements out of 2009. Revenues are now expected to be between $4.1 and $4.2 billion based on Boeing's 2009 delivery guidance of 480-485 aircraft; anticipated B787 deliveries consistent with our expectations following Boeing's announcement of the revised B787 schedule on August 27, 2009; 2009 expected Airbus deliveries of approximately 483 aircraft; internal Spirit forecasts for non-OEM production activity and non-Boeing and Airbus customers; and foreign exchange rates consistent with fourth quarter 2008 levels.
Fully diluted earnings per share for 2009 remains unchanged and is expected to be between $1.45 and $1.55 per share after the increase in interest expense and fees associated with the recently issued senior unsecured notes.
Cash flow from operations less capital expenditures, net of customer reimbursements, is now expected to be no more than a ($150) million use of cash in the aggregate, with capital expenditures of approximately $225 million.
The effective tax rate is now forecasted to be approximately 30 percent for 2009.
The guidance assumes the settlement and receipt of certain outstanding non-recurring contract payments associated with our development programs. To the extent these forecasted payments are not received during the fourth quarter of 2009, they will represent a shift in revenues, earnings and cash flows from 2009 to 2010.
SOURCE:: Spirit AeroSystems
CONTACT: Investor Relations,
Alan Hermanson,
+1-316-523-7040, or
Media,
Debbie Gann,
+1-316-526-3910, both of Spirit AeroSystems
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