Third Quarter 2017 Results and Highlights
- Finalized definitive agreements with Boeing to settle open
commercial issues on a range of programs into 2022
- Revenue of $1.7 billion, up 2%
y/y
- Earnings per share (EPS) of $1.26; up 9% y/y
- Cash from operations of $291
million, up 9% y/y; Free cash flow* of $240 million, up 12% y/y
- Repurchased 2.7 million shares for $194
million at an average share price of $72.23
WICHITA, Kan., Nov. 1, 2017 /CNW/ -- Spirit AeroSystems
Holdings, Inc. [NYSE: SPR] reported third quarter 2017 financial
results driven by solid operating performance.
Table 1.
Summary Financial Results (unaudited)
|
|
|
|
|
3rd
Quarter
|
|
Nine
Months
|
|
($ in millions,
except per share data)
|
2017
|
2016
|
Change
|
2017
|
2016
|
Change
|
|
|
|
|
|
|
|
Revenues
|
$1,748
|
$1,711
|
2%
|
$5,268
|
$5,223
|
1%
|
Operating
Income
|
$211
|
$214
|
(1%)
|
$342
|
$564
|
(39%)
|
Operating Income
as a % of Revenues
|
12.1%
|
12.5%
|
(40)
BPS
|
6.5%
|
10.8%
|
(430)
BPS
|
Net
Income
|
$147
|
$145
|
1%
|
$232
|
$362
|
(36%)
|
Net Income as a %
of Revenues
|
8.4%
|
8.5%
|
(10)
BPS
|
4.4%
|
6.9%
|
(250)
BPS
|
Earnings Per Share
(Fully Diluted)
|
$1.26
|
$1.16
|
9%
|
$1.95
|
$2.80
|
(30%)
|
Adjusted Earnings
Per Share (Fully Diluted)*
|
$1.26
|
$1.16
|
9%
|
$4.00
|
$3.66
|
9%
|
Fully Diluted
Weighted Avg Share Count
|
117.0
|
125.3
|
|
119.0
|
129.0
|
|
|
|
|
|
|
|
|
"This quarter is representative of the reliable results we've
been working hard to deliver consistently over the last few years,"
Spirit President and CEO Tom Gentile
said. "There is great momentum here at Spirit with the projected
industry growth, planned rate increases and stable relationships
with Boeing and Airbus."
Revenue
Spirit's third quarter 2017 revenue was $1.7 billion, up slightly from the same period of
2016, primarily driven by higher production deliveries on the
Boeing 737 and 787 programs and increased defense-related activity,
partially offset by lower production deliveries on the Boeing 777
program and decreased Global Customer Support & Services
(GCS&S) activity. (Table 1)
Spirit's backlog at the end of the third quarter of 2017 was
approximately $45 billion, with work
packages on all commercial platforms in the Boeing and Airbus
backlog.
Earnings
Operating income for the third quarter of 2017 was $211 million, down slightly compared to
$214 million in the same period of
2016, primarily due to lower production deliveries on the Boeing
777 program and lower GCS&S activity, partially offset by
increased sales on the Airbus A320 and higher recurring and
non-recurring activity on the Boeing 737 program. Third quarter EPS
was $1.26 per share, up 9 percent
compared to $1.16 in the same period
of 2016. (Table 1)
Cash
Cash from operations in the third quarter of 2017 was
$291 million, up 9 percent compared
to $266 million in the same quarter
last year. Free cash flow* in the third quarter of 2017 was
$240 million, up 12 percent compared
to free cash flow of $214 million in
the same quarter last year. (Table 2)
Cash balance at the end of the quarter was $727 million. The company's $650 million revolving credit facility remained
undrawn at the end of the quarter.
During the third quarter, Spirit repurchased 2.7 million shares
for $194 million. "With the shares
repurchased this quarter, we have $598
million remaining on our repurchase authorization," Gentile
said.
Table 2.
Cash Flow and Liquidity (unaudited)
|
|
|
|
|
3rd
Quarter
|
Nine
Months
|
($ in
millions)
|
2017
|
2016
|
2017
|
2016
|
|
|
|
|
|
Cash from
Operations
|
$291
|
$266
|
$625
|
$574
|
Purchases of
Property, Plant & Equipment
|
($51)
|
($52)
|
($139)
|
($157)
|
Free Cash
Flow*
|
$240
|
$214
|
$486
|
$417
|
Adjusted Free Cash
Flow*
|
$240
|
$214
|
$486
|
$374
|
|
|
|
|
|
|
|
|
September
28,
|
December
31,
|
Liquidity
|
|
|
2017
|
2016
|
Cash
|
|
|
$727
|
$698
|
Total
Debt
|
|
|
$1,089
|
$1,087
|
|
|
|
|
|
Financial Outlook and Risk to Future Financial
Results
"For 2017 we are reaffirming our guidance. Also, as we
highlighted at our recent Investor Day, we have increased our
long-term objective for free cash flow as a percent of sales from
6% - 8% to 7% - 9%," Gentile said.
|
|
|
Table 3.
Financial Outlook Reaffirmed November 1, 2017
|
2017
Guidance
|
|
|
|
Revenues
|
|
$6.8 - $6.9
billion
|
|
|
|
Earnings Per Share
(Fully Diluted)
|
|
$2.95 -
$3.20
|
|
|
|
Adjusted Earnings
Per Share (Fully Diluted)*
|
|
$5.00 -
$5.25
|
|
|
|
Effective Tax
Rate
|
|
~29%
|
|
|
|
Cash from
Operations
|
|
$750 - $850
million
|
|
|
|
Free Cash
Flow*
|
|
$500 - $550
million
|
|
|
|
Risks applicable to our financial guidance are described more
fully in the Cautionary Statement Regarding Forward-Looking
Statements in this release.
Segment Results
Fuselage Systems
Fuselage Systems segment revenue in the third quarter of 2017
increased by 9 percent from the same period last year to
$957 million, primarily due to higher
production deliveries on the Boeing 737 and 787 programs as well as
increased defense work and non-recurring activity on certain Boeing
programs, partially offset by lower production deliveries on the
Boeing 777 program and lower GCS&S activity. Operating margin
for the third quarter of 2017 decreased to 15.5 percent, compared
to 16.2 percent during the same period of 2016, primarily due to
lower GCS&S activity. In the third quarter of 2017, the segment
recorded pretax $(2.4) million of
unfavorable cumulative catch-up adjustments and net forward losses
of $(0.9) million.
Propulsion Systems
Propulsion Systems segment revenue in the third quarter of 2017
decreased 10 percent from the same period last year to $408 million, primarily driven by lower
production deliveries on the Boeing 777 program and decreased
GCS&S activity, partially offset by higher production
deliveries on the Boeing 737. Operating margin for the third
quarter of 2017 increased to 18.2 percent, compared to 17.1 percent
during the same period of 2016, primarily driven by higher
non-recurring revenue on certain Boeing programs. In the third
quarter of 2017, the segment recorded pretax $2.4 million of favorable cumulative catch-up
adjustments and net favorable change in estimates on forward loss
programs of $1.3 million.
Wing Systems
Wing Systems segment revenue in the third quarter of 2017
increased by 1 percent from the same period last year to
$382 million, primarily due to higher
production deliveries on the Boeing 737, A350 XWB and A320
programs, partially offset by lower production deliveries on the
Boeing 777 program. Operating margin for the third quarter of 2017
decreased slightly to 13.3 percent, compared to 13.6 percent during
the same period of 2016. In the third quarter of 2017, the segment
recorded pretax $(2.8) million of
unfavorable cumulative catch-up adjustments and net forward losses
of $(2.4) million.
Table 4.
Segment Reporting (unaudited)
|
|
|
|
3rd
Quarter
|
Nine
Months
|
($ in
millions)
|
2017
|
2016
|
Change
|
2017
|
2016
|
Change
|
|
|
|
|
|
|
|
Segment
Revenues
|
|
|
|
|
|
|
Fuselage
Systems
|
$957.0
|
$880.3
|
8.7%
|
$2,812.1
|
$2,679.7
|
4.9%
|
Propulsion Systems
|
407.9
|
453.0
|
(10.0%)
|
1,250.7
|
1,373.3
|
(8.9%)
|
Wing
Systems
|
382.2
|
376.8
|
1.4%
|
1,201.7
|
1,161.5
|
3.5%
|
All
Other
|
1.1
|
1.3
|
(15.4%)
|
3.9
|
8.4
|
(53.6%)
|
Total Segment
Revenues
|
$1,748.2
|
$1,711.4
|
2.2%
|
$5,268.4
|
$5,222.9
|
0.9%
|
|
|
|
|
|
|
|
Segment Earnings
from Operations
|
|
|
|
|
|
|
Fuselage
Systems
|
$148.3
|
$142.5
|
4.1%
|
$218.5
|
$340.9
|
(35.9%)
|
Propulsion Systems
|
74.2
|
77.5
|
(4.3%)
|
188.9
|
250.9
|
(24.7%)
|
Wing
Systems
|
50.9
|
51.1
|
(0.4%)
|
140.2
|
174.7
|
(19.7%)
|
All
Other
|
0.2
|
0.6
|
(66.7%)
|
(0.5)
|
2.0
|
**
|
Total Segment
Operating Earnings
|
$273.6
|
$271.7
|
0.7%
|
$547.1
|
$768.5
|
(28.8%)
|
|
|
|
|
|
|
|
Unallocated
Expense
|
|
|
|
|
|
|
Corporate
SG&A
|
($48.8)
|
($52.2)
|
6.5%
|
($146.8)
|
($172.4)
|
14.8%
|
Impact of Severe
Weather Event
|
-
|
-
|
**
|
(19.9)
|
-
|
**
|
Research &
Development
|
(9.5)
|
(5.4)
|
(75.9%)
|
(21.2)
|
(15.9)
|
(33.3%)
|
Cost of
Sales
|
(3.9)
|
0.3
|
**
|
(17.0)
|
(16.0)
|
(6.3%)
|
Total Earnings
from Operations
|
$211.4
|
$214.4
|
(1.4%)
|
$342.2
|
$564.2
|
(39.3%)
|
|
|
|
|
|
|
|
Segment Operating
Earnings as % of Revenues
|
|
|
|
|
|
|
Fuselage
Systems
|
15.5%
|
16.2%
|
(70)
BPS
|
7.8%
|
12.7%
|
(490)
BPS
|
Propulsion Systems
|
18.2%
|
17.1%
|
110
BPS
|
15.1%
|
18.3%
|
(320)
BPS
|
Wing
Systems
|
13.3%
|
13.6%
|
(30)
BPS
|
11.7%
|
15.0%
|
(330)
BPS
|
All
Other
|
**
|
**
|
|
**
|
**
|
|
Total Segment
Operating Earnings as % of Revenues
|
15.7%
|
15.9%
|
(20)
BPS
|
10.4%
|
14.7%
|
(430)
BPS
|
|
|
|
|
|
|
|
Total Operating
Earnings as % of Revenues
|
12.1%
|
12.5%
|
(40)
BPS
|
6.5%
|
10.8%
|
(430)
BPS
|
|
|
|
|
|
|
|
** Represents an amount
equal to or in excess of 100% or not meaningful.
|
* Non-GAAP financial measure, see Appendix for
reconciliation
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains "forward-looking statements" that
may involve many risks and uncertainties. Forward-looking
statements reflect our current expectations or forecasts of future
events. Forward-looking statements generally can be identified by
the use of forward-looking terminology such as "aim," "anticipate,"
"believe," "could," "continue," "estimate," "expect," "goal,"
"forecast," "intend," "may," "might," "objective," "plan,"
"predict," "project," "should," "target," "will," "would," and
other similar words, or phrases, or the negative thereof, unless
the context requires otherwise. These statements reflect
management's current views with respect to future events and are
subject to risks and uncertainties, both known and unknown. Our
actual results may vary materially from those anticipated in
forward-looking statements. We caution investors not to place undue
reliance on any forward-looking statements. Important factors that
could cause actual results to differ materially from those
reflected in such forward-looking statements and that should be
considered in evaluating our outlook include, but are not limited
to, the following: 1) our ability to continue to grow our business
and execute our growth strategy, including the timing, execution,
and profitability of new and maturing programs; 2) our ability to
perform our obligations under our new and maturing commercial,
business aircraft, and military development programs, and the
related recurring production; 3) our ability to accurately estimate
and manage performance, cost, and revenue under our contracts,
including our ability to achieve certain cost reductions with
respect to the B787 program; 4) margin pressures and the potential
for additional forward losses on new and maturing programs; 5) our
ability to accommodate, and the cost of accommodating, announced
increases in the build rates of certain aircraft; 6) the effect on
aircraft demand and build rates of changing customer preferences
for business aircraft, including the effect of global economic
conditions on the business aircraft market and expanding conflicts
or political unrest in the Middle
East or Asia; 7) customer
cancellations or deferrals as a result of global economic
uncertainty or otherwise; 8) the effect of economic conditions in
the industries and markets in which we operate in the U.S. and
globally and any changes therein, including fluctuations in foreign
currency exchange rates; 9) the success and timely execution of key
milestones such as the receipt of necessary regulatory approvals
and customer adherence to their announced schedules; 10) our
ability to successfully negotiate, or re-negotiate, future pricing
under our supply agreements with Boeing and our other customers;
11) our ability to enter into profitable supply arrangements with
additional customers; 12) the ability of all parties to satisfy
their performance requirements under existing supply contracts with
our two major customers, Boeing and Airbus, and other customers,
and the risk of nonpayment by such customers; 13) any adverse
impact on Boeing's and Airbus' production of aircraft resulting
from cancellations, deferrals, or reduced orders by their customers
or from labor disputes or acts of terrorism; 14) any adverse impact
on the demand for air travel or our operations from the outbreak of
diseases or epidemic or pandemic outbreaks; 15) our ability to
avoid or recover from cyber-based or other security attacks,
information technology failures, or other disruptions; 16) returns
on pension plan assets and the impact of future discount rate
changes on pension obligations; 17) our ability to borrow
additional funds or refinance debt; 18) competition from commercial
aerospace original equipment manufacturers and other aerostructures
suppliers; 19) the effect of governmental laws, such as U.S. export
control laws and U.S. and foreign anti-bribery laws such as the
Foreign Corrupt Practices Act and the United Kingdom Bribery Act,
and environmental laws and agency regulations, both in the U.S. and
abroad; 20) the effect of potential changes in tax law, such as
those outlined in recent proposals on U.S. tax reform; 21) any
reduction in our credit ratings; 22) our dependence on our
suppliers, as well as the cost and availability of raw materials
and purchased components; 23) our ability to recruit and retain
highly-skilled employees and our relationships with the unions
representing many of our employees; 24) spending by the U.S. and
other governments on defense; 25) the possibility that our cash
flows and borrowing facility may not be adequate for our additional
capital needs or for payment of interest on, and principal of, our
indebtedness; 26) our exposure under our existing senior revolving
credit facility to higher interest payments should interest rates
increase substantially; 27) the effectiveness of any interest rate
hedging programs; 28) the effectiveness of our internal control
over financial reporting; 29) the outcome or impact of ongoing or
future litigation, claims, and regulatory actions; and 30) exposure
to potential product liability and warranty claims. These factors
are not exhaustive and it is not possible for us to predict all
factors that could cause actual results to differ materially from
those reflected in our forward-looking statements. These factors
speak only as of the date hereof, and new factors may emerge or
changes to the foregoing factors may occur that could impact our
business. As with any projection or forecast, these statements are
inherently susceptible to uncertainty and changes in circumstances.
Except to the extent required by law, we undertake no obligation
to, and expressly disclaim any obligation to, publicly update or
revise any forward-looking statements, whether as a result of new
information, future events, or otherwise. Additional information
concerning these and other factors can be found in our filings with
the Securities and Exchange Commission, including our most recent
Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
|
Spirit Shipset
Deliveries
|
|
|
(one shipset
equals one aircraft)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd
Quarter
|
|
Nine
Months
|
|
|
|
2017
|
2016
|
|
2017
|
2016
|
|
B737
|
|
137
|
126
|
|
399
|
384
|
|
B747
|
|
1
|
2
|
|
4
|
7
|
|
B767
|
|
8
|
6
|
|
21
|
19
|
|
B777
|
|
15
|
26
|
|
55
|
77
|
|
B787
|
|
37
|
30
|
|
105
|
99
|
|
Total
Boeing
|
|
198
|
190
|
|
584
|
586
|
|
|
|
|
|
|
|
|
|
A320
Family(1)
|
|
146
|
135
|
|
452
|
427
|
|
A330/340
|
|
21
|
17
|
|
60
|
50
|
|
A350
|
|
18
|
16
|
|
65
|
50
|
|
A380
|
|
2
|
4
|
|
10
|
17
|
|
Total
Airbus
|
|
187
|
172
|
|
587
|
544
|
|
|
|
|
|
|
|
|
|
Business/Regional
Jets
|
|
19
|
22
|
|
67
|
59
|
|
|
|
|
|
|
|
|
|
Total
|
|
404
|
384
|
|
1,238
|
1,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Third
quarter 2016 A320 deliveries have been updated to include composite
units.
|
Spirit
AeroSystems Holdings, Inc.
|
Condensed
Consolidated Statements of Operations
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Nine
Months Ended
|
|
|
|
|
|
|
|
|
|
September 28,
2017
|
|
September 29,
2016
|
|
September 28,
2017
|
|
September 29,
2016
|
|
|
($ in millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
|
$1,748.2
|
|
$1,711.4
|
|
$5,268.4
|
|
$5,222.9
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
1,478.5
|
|
1,439.4
|
|
4,738.3
|
|
4,470.4
|
Selling, general and
administrative
|
|
48.8
|
|
52.2
|
|
146.8
|
|
172.4
|
Impact of severe
weather event
|
|
-
|
|
-
|
|
19.9
|
|
-
|
Research and
development
|
|
9.5
|
|
5.4
|
|
21.2
|
|
15.9
|
|
Total operating
costs and expenses
|
|
1,536.8
|
|
1,497.0
|
|
4,926.2
|
|
4,658.7
|
|
Operating
income
|
|
211.4
|
|
214.4
|
|
342.2
|
|
564.2
|
Interest expense and
financing fee amortization
|
|
(10.4)
|
|
(12.2)
|
|
(30.1)
|
|
(47.5)
|
Other income
(expense), net
|
|
1.9
|
|
(0.3)
|
|
4.6
|
|
(8.7)
|
|
Income before
income taxes and equity in net income of affiliate
|
|
202.9
|
|
201.9
|
|
316.7
|
|
508.0
|
Income tax
provision
|
|
(55.9)
|
|
(57.3)
|
|
(84.9)
|
|
(147.8)
|
|
Income before
equity in net income of affiliate
|
|
147.0
|
|
144.6
|
|
231.8
|
|
360.2
|
Equity in net income
of affiliate
|
|
0.2
|
|
0.5
|
|
0.3
|
|
1.3
|
|
Net
income
|
|
$147.2
|
|
$145.1
|
|
$232.1
|
|
$361.5
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
Basic
|
|
$1.27
|
|
$1.16
|
|
$1.97
|
|
$2.82
|
Shares
|
|
115.8
|
|
124.4
|
|
117.8
|
|
128.2
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$1.26
|
|
$1.16
|
|
$1.95
|
|
$2.80
|
Shares
|
|
117.0
|
|
125.3
|
|
119.0
|
|
129.0
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per common share
|
|
$0.10
|
|
-
|
|
$0.30
|
|
-
|
Spirit AeroSystems
Holdings, Inc.
|
Condensed
Consolidated Balance Sheets
|
(unaudited)
|
|
|
|
September 28,
2017
|
|
December 31,
2016
|
|
|
($ in
millions)
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$726.6
|
|
$697.7
|
Restricted
cash
|
|
3.2
|
|
-
|
Accounts receivable,
net
|
|
851.7
|
|
660.5
|
Inventory,
net
|
|
1,363.2
|
|
1,515.3
|
Other current
assets
|
|
67.3
|
|
36.9
|
Total current assets
|
|
3,012.0
|
|
2,910.4
|
Property, plant and
equipment, net
|
|
2,018.7
|
|
1,991.6
|
Pension
assets
|
|
309.2
|
|
282.3
|
Other
assets
|
|
197.3
|
|
220.9
|
Total assets
|
|
$5,537.2
|
|
$5,405.2
|
Liabilities
|
|
|
|
|
Accounts
payable
|
|
$762.1
|
|
$579.7
|
Accrued
expenses
|
|
258.3
|
|
216.2
|
Profit
sharing
|
|
65.7
|
|
101.4
|
Current portion of
long-term debt
|
|
27.9
|
|
26.7
|
Advance payments,
short-term
|
|
131.0
|
|
199.3
|
Deferred revenue,
short-term
|
|
68.3
|
|
312.1
|
Deferred grant income
liability - current
|
|
21.0
|
|
14.4
|
Other current
liabilities
|
|
601.7
|
|
94.4
|
Total current liabilities
|
|
1,936.0
|
|
1,544.2
|
Long-term
debt
|
|
1,060.9
|
|
1,060.0
|
Advance payments,
long-term
|
|
255.6
|
|
342.0
|
Pension/OPEB
obligation
|
|
40.3
|
|
43.9
|
Deferred revenue and
other deferred credits
|
|
166.5
|
|
146.8
|
Deferred grant income
liability - non-current
|
|
44.9
|
|
63.4
|
Other
liabilities
|
|
273.6
|
|
276.1
|
Stockholders'
Equity
|
|
|
|
|
Preferred stock, par
value $0.01, 10,000,000 shares authorized, no shares
issued
|
|
-
|
|
-
|
Common stock,
Class A par value $0.01, 200,000,000 shares authorized,
115,624,845 and 121,642,556 shares issued and outstanding,
respectively
|
|
1.2
|
|
1.2
|
Additional paid-in
capital
|
|
1,081.0
|
|
1,078.9
|
Accumulated other
comprehensive loss
|
|
(153.3)
|
|
(186.9)
|
Retained
earnings
|
|
2,310.9
|
|
2,113.9
|
Treasury stock, at
cost (30,273,833 and 23,936,092 shares, respectively)
|
|
(1,480.9)
|
|
(1,078.8)
|
Total stockholders' equity
|
|
1,758.9
|
|
1,928.3
|
Noncontrolling
interest
|
|
0.5
|
|
0.5
|
Total equity
|
|
1,759.4
|
|
1,928.8
|
Total liabilities and equity
|
|
$5,537.2
|
|
$5,405.2
|
Spirit AeroSystems
Holdings, Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(unaudited)
|
|
|
|
|
|
|
|
For the Nine
Months Ended
|
|
|
|
|
|
September 28,
2017
|
|
September 29,
2016
|
|
|
($ in
millions)
|
Operating
activities
|
|
|
|
|
Net income
|
|
$232.1
|
|
$361.5
|
Adjustments to
reconcile net income to net cash provided by operating
activities
|
|
|
|
|
Depreciation
expense
|
|
159.0
|
|
149.1
|
Amortization
expense
|
|
0.2
|
|
0.2
|
Amortization of deferred
financing fees
|
|
2.5
|
|
18.5
|
Accretion of customer supply
agreement
|
|
1.5
|
|
3.5
|
Employee stock compensation
expense
|
|
15.9
|
|
35.7
|
Excess tax benefits from
share-based payment arrangements
|
|
-
|
|
0.1
|
Loss from interest rate
swap
|
|
1.1
|
|
-
|
(Gain) loss from foreign
currency transactions
|
|
(5.9)
|
|
15.9
|
Loss (gain) on impairment
and disposition of assets
|
|
7.9
|
|
(0.5)
|
Deferred
taxes
|
|
29.0
|
|
34.7
|
Pension and other
post-retirement benefits, net
|
|
(32.5)
|
|
(5.0)
|
Grant liability
amortization
|
|
(13.9)
|
|
(8.6)
|
Equity in net income of
affiliate
|
|
(0.3)
|
|
(1.3)
|
Changes in assets and
liabilities
|
|
|
|
|
Accounts receivable,
net
|
|
(177.8)
|
|
(220.8)
|
Inventory, net
|
|
433.9
|
|
257.3
|
Accounts payable and accrued
liabilities
|
|
212.8
|
|
(18.6)
|
Profit sharing/deferred
compensation
|
|
(35.9)
|
|
2.8
|
Advance payments
|
|
(154.7)
|
|
(101.8)
|
Income taxes
receivable/payable
|
|
(36.0)
|
|
1.3
|
Deferred revenue and other
deferred credits
|
|
(222.8)
|
|
26.0
|
Other
|
|
208.5
|
|
24.4
|
Net
cash provided by operating activities
|
|
$624.6
|
|
$574.4
|
Investing
activities
|
|
|
|
|
Purchase of property, plant
and equipment
|
|
(138.7)
|
|
(156.8)
|
Proceeds from sale of
assets
|
|
0.3
|
|
0.6
|
Net
cash used in investing activities
|
|
($138.4)
|
|
($156.2)
|
Financing
activities
|
|
|
|
|
Proceeds from issuance of
bonds
|
|
-
|
|
299.8
|
Principal payments of
debt
|
|
(2.3)
|
|
(16.7)
|
Payments on term
loan
|
|
(12.5)
|
|
-
|
Payments on bonds
|
|
-
|
|
(300.0)
|
Taxes paid related to net
share settlement awards
|
|
(13.8)
|
|
(15.2)
|
Excess tax benefits from
share-based payment arrangements
|
|
-
|
|
(0.1)
|
Debt issuance and financing
costs
|
|
(0.9)
|
|
(17.2)
|
Proceeds from financing
under the New Market Tax Credit Program
|
|
7.6
|
|
-
|
Purchase of treasury
stock
|
|
(402.1)
|
|
(649.6)
|
Dividends paid
|
|
(35.7)
|
|
-
|
Change in restricted cash
|
|
(3.2)
|
|
-
|
Net
cash used in financing activities
|
|
($462.9)
|
|
($699.0)
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
5.6
|
|
(6.1)
|
Net
increase (decrease) in cash and cash equivalents for the
period
|
|
$28.9
|
|
($286.9)
|
Cash and cash
equivalents, beginning of the period
|
|
697.7
|
|
957.3
|
Cash and cash
equivalents, end of the period
|
|
$726.6
|
|
$670.4
|
Appendix
In addition to reporting our financial information using U.S.
Generally Accepted Accounting Principles (GAAP), management
believes that certain non-GAAP measures (which are indicated by *
in this report) provide investors with important perspectives into
the company's ongoing business performance. The non-GAAP measures
we use in this report are (i) adjusted diluted earnings per share,
(ii) free cash flow, and (iii) adjusted free cash flow, which are
described further below. The company does not intend for the
information to be considered in isolation or as a substitute for
the related GAAP measures. Other companies may define and calculate
the measures differently than we do, limiting the usefulness of the
measures for comparison with other companies.
Adjusted Diluted Earnings Per Share. To provide additional
transparency, we have disclosed non-GAAP adjusted diluted earnings
per share (Adjusted EPS). This metric excludes various items that
are not considered to be directly related to our operating
performance. Management uses Adjusted EPS as a measure of business
performance and we believe this information is useful in providing
period-to-period comparisons of our results. The most comparable
GAAP measure is diluted earnings per share.
Free Cash Flow. Free cash flow is defined as GAAP cash from
operating activities, less capital expenditures for property, plant
and equipment. Management believes free cash flow provides
investors with an important perspective on the cash available for
shareholders, debt repayment, and acquisitions after making the
capital investments required to support ongoing business operations
and long term value creation. Free cash flow does not represent the
residual cash flow available for discretionary expenditures as it
excludes certain mandatory expenditures. Management uses free cash
flow as a measure to assess both business performance and overall
liquidity.
Adjusted Free Cash Flow. Management considers certain items that
arise from time to time to be outside the ordinary course of our
operations. Management believes that excluding these 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. Accordingly,
Adjusted Free Cash Flow is defined as free cash flow less these
special items. The most comparable GAAP measure is cash provided by
operating activities.
The tables below provide reconciliations between the GAAP and
non-GAAP measures.
Adjusted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd
Quarter
|
|
Nine
Months
|
|
Guidance
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted Earnings
Per Share
|
|
$1.26
|
|
$1.16
|
|
$1.95
|
|
$2.80
|
|
$2.95 -
$3.20
|
|
Impact of Airbus
Agreement, CEO Retirement, and Debt Refinancing
1
|
-
|
|
-
|
|
-
|
|
0.86
|
|
|
|
Impact of MOU with
Boeing 2
|
|
-
|
|
-
|
|
2.05
|
|
-
|
|
2.05
|
|
Adjusted Diluted
Earnings Per Share
|
|
$1.26
|
|
$1.16
|
|
$4.00
|
|
$3.66
|
|
$5.00 -
$5.25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Shares (in
millions)
|
|
117.0
|
|
125.3
|
|
119.0
|
|
129.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
Represents the net earnings per share impact of the
Airbus agreement of $0.68, CEO retirement costs of $0.11 and debt
refinancing charge of $0.07.
|
|
|
|
|
|
|
|
|
|
|
|
|
2 Represents the net
earnings per share impact of the MOU with Boeing of
$2.05.
|
Free Cash
Flow
|
($ in
millions)
|
|
|
|
|
|
|
|
|
|
Third
Quarter
|
|
Nine
Months
|
|
Guidance
|
|
2017
|
2016
|
|
2017
|
2016
|
|
2017
|
|
|
|
|
|
|
|
|
Cash from
Operations
|
$291
|
$266
|
|
$625
|
$574
|
|
$750 -
$850
|
Capital
Expenditures
|
(51)
|
(52)
|
|
(139)
|
(157)
|
|
(250 -
300)
|
Free Cash
Flow
|
$240
|
$214
|
|
$486
|
$417
|
|
$500 -
$550
|
Cash Received under
787 Interim Pricing Agreement
|
-
|
-
|
|
-
|
(43)
|
|
|
|
|
|
|
|
|
|
|
Adjusted Free Cash
Flow
|
$240
|
$214
|
|
$486
|
$374
|
|
$500 -
$550
|
View original content with
multimedia:http://www.prnewswire.com/news-releases/spirit-aerosystems-announces-solid-third-quarter-2017-operating-results-with-eps-up-9-yy-and-cash-from-operations-up-9-yy-finalized-definitive-agreements-with-boeing-executed-194-million-in-share-repurchases-300547077.html
SOURCE Spirit AeroSystems Holdings, Inc.