WICHITA, Kan., Feb. 23, 2021 /PRNewswire/ --
- Completed acquisition of select assets of Bombardier to
diversify Spirit's business
- Raised $2.1 billion of senior
secured debt and terminated 2018 credit facility during the year;
Paid off $1.2 billion in debt during
the year; Ended year with cash balance of $1.9 billion
- Reduced commercial aviation employees by 8,000 and cut
annualized costs of $1 billion to
align to lower rates of production
Spirit AeroSystems Holdings, Inc. [NYSE: SPR] ("Spirit" or the
"Company") reported fourth quarter and full-year 2020 financial
results.
Table 1.
Summary Financial Results (unaudited)
|
|
|
|
|
4th
Quarter
|
|
Twelve
Months
|
|
($ in millions,
except per share data)
|
2020
|
2019
|
Change
|
2020
|
2019
|
Change
|
|
|
|
|
|
|
|
Revenues
|
$877
|
$1,959
|
(55%)
|
$3,405
|
$7,863
|
(57%)
|
Operating (Loss)
Income
|
($101)
|
$96
|
**
|
($813)
|
$761
|
**
|
Operating (Loss)
Income as a % of Revenues
|
(11.6%)
|
4.9%
|
**
|
(23.9%)
|
9.7%
|
**
|
Net (Loss)
Income
|
($296)
|
$68
|
**
|
($870)
|
$530
|
**
|
Net (Loss) Income
as a % of Revenues
|
(33.8%)
|
3.5%
|
**
|
(25.6%)
|
6.7%
|
**
|
(Loss) Earnings
Per Share (Fully Diluted)
|
($2.85)
|
$0.65
|
**
|
($8.38)
|
$5.06
|
**
|
Adjusted (Loss)
Earnings Per Share (Fully Diluted)*
|
($1.31)
|
$0.79
|
**
|
($5.72)
|
$5.54
|
**
|
Fully Diluted
Weighted Avg Share Count
|
104.0
|
104.6
|
|
103.9
|
104.7
|
|
|
|
|
|
|
|
|
** Represents an amount
equal to or in excess of 100% or not meaningful.
|
"2020 was one of the most challenging years in aviation history.
For Spirit, the 737 MAX grounding and the COVID-19 pandemic created
a dual-crisis. Our response focused on five critical actions:
protecting employees, restructuring our cost base, strengthening
our liquidity, implementing productivity projects, and diversifying
the business with our planned acquisitions," said Tom Gentile, Spirit AeroSystems President and
Chief Executive Officer. "With these actions, we worked to
stabilize our liquidity and ended the year with $1.9 billion in cash while positioning Spirit to
continue playing a leadership role in the aviation industry."
During the fourth-quarter and full-year 2020 earnings call,
management will address the preliminary assessment of the purchase
accounting treatment related to the Bombardier acquisition.
Revenue
Spirit's fourth quarter of 2020 revenue was $877 million, down from the same period of 2019,
primarily due to the significantly lower 737 MAX production
resulting from the grounding of the program and the impacts of
COVID-19. Deliveries decreased to 231 shipsets during the fourth
quarter of 2020 compared to 452 shipsets in the same period of
2019, including Boeing 737 MAX deliveries of 19 shipsets compared
to 153 shipsets in the same period of the prior year. Revenue for
the full-year decreased to $3.4
billion, primarily due to the significantly lower Boeing 737
MAX production resulting from the grounding of the program and the
impacts of COVID-19. Full-year deliveries decreased to 920 shipsets
during 2020 compared to 1,791 shipsets in 2019, including Boeing
737 MAX deliveries of 71 shipsets compared to 606 shipsets in the
prior year.
Spirit's backlog at the end of the fourth quarter of 2020 was
approximately $34 billion, with work
packages on all commercial platforms in the Boeing and Airbus
backlog.
Earnings
Operating loss for the fourth quarter of 2020 was $101 million, down compared to operating income
of $96 million in the same period of
2019. Included in the fourth quarter 2020 operating loss were
excess capacity costs of $50.1
million and forward loss charges of $28.1 million, primarily driven by the lower
production rates announced by Boeing and Airbus on the 787 and A350
programs. In comparison, during the fourth quarter of 2019, Spirit
recorded $41.7 million of net forward
loss charges and $13.5 million of
unfavorable cumulative catch-up adjustments. Operating loss for the
full-year of 2020 was $813 million,
down compared to operating income of $761
million in 2019. Included in the 2020 operating loss were
excess capacity costs of $278.9
million, abnormal costs related to COVID-19 of $33.7 million, and forward loss charges of
$370.3 million, primarily driven by
the lower production rates announced by Boeing and Airbus on the
787 and A350 programs. In comparison, during 2019, Spirit recorded
$63.5 million of net forward loss
charges. Additionally, during 2020, Spirit recognized restructuring
expenses of $73.0 million for
cost-alignment and headcount reductions and non-cash expenses of
$86.5 million as a result of the
voluntary retirement program ("VRP") offered during 2020.
Fourth quarter EPS was $(2.85),
compared to $0.65 in the same period
of 2019. Fourth quarter 2020 adjusted EPS* was $(1.31), which excluded the impacts from the
Bombardier acquisition, now-terminated Asco acquisition,
restructuring costs, the VRP offered during 2020, and the
$150.2 million deferred tax asset
valuation allowance established during the fourth quarter of 2020.
During the same period of 2019, adjusted EPS* was $0.79, which excluded the impact of the Asco
acquisition and the VRP offered during 2019. Full-year 2020 EPS was
$(8.38), compared to $5.06 in 2019. Full-year 2020 adjusted EPS* was
$(5.72), which excluded the impacts
from the Bombardier acquisition, now-terminated Asco acquisition,
restructuring costs, VRP offered during 2020, and the deferred tax
asset valuation allowance. In comparison, full-year 2019 adjusted
EPS* was $5.54, which excluded the
impact of the Asco acquisition and the VRP offered during 2019.
(Table 1)
Cash
Cash from operations in the fourth quarter of 2020 was
$(132) million, down from
$204 million in the same quarter last
year, primarily due to negative impacts of working capital
requirements and significantly lower production deliveries,
partially offset by favorable cash tax. Free cash flow* in the
fourth quarter of 2020 was $(181)
million, down compared to $91
million in the same period of 2019. Full-year cash from
operations was $(745) million, down
from $923 million in 2019, primarily
due to negative impacts of working capital requirements,
significantly lower production deliveries and restructuring costs
of $73 million, partially offset by
$215 million received as a result of
the February 2020 MOA with Boeing as
well as favorable cash taxes. Full-year free cash flow* was
$(864) million, down compared to
$691 million in 2019. Cash balance at
the end of 2020 was $1.9 billion,
compared to $2.4 billion at the end
of 2019. (Table 2)
Table 2.
Cash Flow and Liquidity (unaudited)
|
|
|
|
|
|
4th
Quarter
|
|
Twelve
Months
|
|
($ in
millions)
|
2020
|
2019
|
Change
|
2020
|
2019
|
Change
|
|
|
|
|
|
|
|
Cash from
Operations
|
($132)
|
$204
|
**
|
($745)
|
$923
|
**
|
Purchases of
Property, Plant & Equipment
|
($49)
|
($113)
|
(57%)
|
($119)
|
($232)
|
(49%)
|
Free Cash
Flow*
|
($181)
|
$91
|
**
|
($864)
|
$691
|
**
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
December
31,
|
|
Liquidity
|
|
|
|
2020
|
2019
|
|
Cash
|
|
|
|
$1,873
|
$2,351
|
|
Total
Debt
|
|
|
|
$3,874
|
$3,034
|
|
|
|
|
|
|
|
|
**
Represents an amount equal to or in excess of 100% or not
meaningful.
|
Segment Results
Fuselage Systems
Fuselage Systems segment revenue in the fourth quarter of 2020
decreased 59 percent from the same period last year to $426 million, primarily due to lower production
volumes on the Boeing 737, 787 and Airbus A350 programs. Operating
margin for the fourth quarter of 2020 decreased to (4.7) percent,
compared to 5.8 percent during the same period of 2019. This
decrease was primarily due to forward losses recognized on the
Boeing 787 and Airbus A350 programs as well as lower profit
recognized on the Boeing 737 program due to excess capacity costs
of $31.2 million with significantly
fewer deliveries. In the fourth quarter of 2020, the segment
recorded pretax $0.2 million of
favorable cumulative catch-up adjustments and $14.0 million of net forward losses. In the
fourth quarter of 2019, the segment recorded pretax $4.2 million of unfavorable cumulative catch-up
adjustments and $24.1 million of net
forward losses.
Propulsion Systems
Propulsion Systems segment revenue in the fourth quarter of 2020
decreased 59 percent from the same period last year to $219 million, primarily due to lower production
volumes on the Boeing 737 program. Operating margin for the fourth
quarter of 2020 decreased to 0.6 percent, compared to 18.7 percent
during the same period of 2019, primarily due to lower margin
recognized on the Boeing 737 program due to excess capacity costs
of $10.3 million with significantly
fewer deliveries. In the fourth quarter of 2020, the segment
recorded pretax $0.7 million of
favorable cumulative catch-up adjustments and $2.7 million of net forward losses. In the fourth
quarter of 2019, the segment recorded pretax $6.3 million of unfavorable cumulative catch-up
adjustments and $12.0 million of net
forward losses.
Wing Systems
Wing Systems segment revenue in the fourth quarter of 2020
decreased 45 percent from the same period last year to $216 million, primarily due to lower production
volumes on the Boeing 737 and Airbus A320 and A350 programs.
Operating margin for the fourth quarter of 2020 decreased to (7.4)
percent, compared to 10.0 percent during the same period of 2019,
primarily due to forward losses recognized on the Boeing 787 and
Airbus A350 programs as well as lower margin recognized on the
Boeing 737 program due to excess capacity costs of $8.7 million with significantly fewer deliveries.
In the fourth quarter of 2020, the segment recorded pretax
$3.7 million of unfavorable
cumulative catch-up adjustments and $11.4
million of net forward losses. In the fourth quarter of
2019, the segment recorded pretax $3.0
million of unfavorable cumulative catch-up adjustments and
$5.6 million of net forward
losses.
Table 4.
Segment Reporting (unaudited)
|
|
|
|
4th
Quarter
|
Twelve
Months
|
($ in
millions)
|
2020
|
2019
|
Change
|
2020
|
2019
|
Change
|
|
|
|
|
|
|
|
Segment
Revenues
|
|
|
|
|
|
|
Fuselage
Systems
|
$426.2
|
$1,034.5
|
(58.8%)
|
$1,725.9
|
$4,206.2
|
(59.0%)
|
Propulsion Systems
|
218.9
|
532.3
|
(58.9%)
|
784.5
|
2,057.8
|
(61.9%)
|
Wing
Systems
|
216.4
|
390.9
|
(44.6%)
|
798.6
|
1,588.3
|
(49.7%)
|
All
Other
|
15.1
|
1.6
|
**
|
95.8
|
10.8
|
**
|
Total Segment
Revenues
|
$876.6
|
$1,959.3
|
(55.3%)
|
$3,404.8
|
$7,863.1
|
(56.7%)
|
|
|
|
|
|
|
|
Segment (Loss)
Earnings from Operations
|
|
|
|
|
|
|
Fuselage
Systems
|
($19.9)
|
$60.3
|
**
|
($454.5)
|
$440.8
|
**
|
Propulsion Systems
|
1.4
|
99.7
|
**
|
(36.8)
|
404.6
|
**
|
Wing
Systems
|
(16.0)
|
38.9
|
**
|
(68.1)
|
216.0
|
**
|
All
Other
|
5.8
|
0.9
|
**
|
34.7
|
3.4
|
**
|
Total Segment
Operating (Loss) Earnings
|
($28.7)
|
$199.8
|
**
|
($524.7)
|
$1,064.8
|
**
|
|
|
|
|
|
|
|
Unallocated
Expense
|
|
|
|
|
|
|
SG&A
|
($58.2)
|
($87.8)
|
33.7%
|
($237.4)
|
($261.4)
|
9.2%
|
Research &
Development
|
(10.7)
|
(18.5)
|
42.2%
|
(38.8)
|
(54.5)
|
28.8%
|
Cost of
Sales
|
(3.8)
|
2.2
|
**
|
(11.9)
|
11.9
|
**
|
Total (Loss)
Earnings from Operations
|
($101.4)
|
$95.7
|
**
|
($812.8)
|
$760.8
|
**
|
|
|
|
|
|
|
|
Segment Operating
(Loss) Earnings as % of Revenues
|
|
|
|
|
|
|
Fuselage
Systems
|
(4.7%)
|
5.8%
|
**
|
(26.3%)
|
10.5%
|
**
|
Propulsion Systems
|
0.6%
|
18.7%
|
**
|
(4.7%)
|
19.7%
|
**
|
Wing
Systems
|
(7.4%)
|
10.0%
|
**
|
(8.5%)
|
13.6%
|
**
|
All
Other
|
38.4%
|
56.3%
|
**
|
36.2%
|
31.5%
|
**
|
Total Segment
Operating (Loss) Earnings as % of Revenues
|
(3.3%)
|
10.2%
|
**
|
(15.4%)
|
13.5%
|
**
|
|
|
|
|
|
|
|
Total Operating
(Loss) Earnings as % of Revenues
|
(11.6%)
|
4.9%
|
**
|
(23.9%)
|
9.7%
|
**
|
|
|
|
|
|
|
|
** Represents an amount
equal to or in excess of 100% or not meaningful.
|
Contact information:
Investor Relations: Ryan Avey or
Aaron Hunt (316) 523-7040
Media: Molly Edwards (316)
523-2479
On the web: http://www.spiritaero.com
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains "forward-looking statements" that
may involve many risks and uncertainties. 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," "model," "objective," "outlook," "plan,"
"potential," "predict," "project," "seek," "should," "target,"
"will," "would," and other similar words, or phrases, or the
negative thereof, unless the context requires otherwise. These
statements are based on circumstances as of the date on which the
statements are made and they 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:
- the impact of the COVID-19 pandemic on our business and
operations, including on the demand for our and our customers'
products and services, on trade and transport restrictions, on the
global aerospace supply chain, on our ability to retain the skilled
work force necessary for production and development, and generally
on our ability to effectively manage the impacts of the COVID-19
pandemic on our business operations;
- demand for our products and services and the general effect of
economic or geopolitical conditions, or other events, such as
pandemics, in the industries and markets in which we operate in the
U.S. and globally;
- the timing and conditions surrounding the full worldwide return
to service (including receiving the remaining regulatory approvals)
of the B737 MAX, future demand for the aircraft, and any residual
impacts of the B737 MAX grounding on production rates for the
aircraft;
- our reliance on Boeing and Airbus for a significant portion of
our revenues;
- the business condition and liquidity of our customers and their
ability to satisfy their contractual obligations to the
Company;
- the certainty of our backlog, including the ability of
customers to cancel or delay orders prior to shipment;
- our ability to accurately estimate and manage performance,
cost, margins, and revenue under our contracts, and the potential
for additional forward losses on new and maturing programs;
- our accounting estimates for revenue and costs for our
contracts and potential changes to those estimates;
- our ability to continue to grow and diversity our business,
execute our growth strategy, and secure replacement programs,
including our ability to enter into profitable supply arrangements
with additional customers;
- the outcome of product warranty or defective product claims and
the impact settlement of such claims may have on our accounting
assumptions;
- our dependence on our suppliers, as well as the cost and
availability of raw materials and purchased components;
- our ability and our suppliers' ability to meet stringent
delivery (including quality and timeliness) standards and
accommodate changes in the build rates of aircraft;
- our ability to maintain continuing, uninterrupted production at
our manufacturing facilities and our suppliers' facilities;
- competitive conditions in the markets in which we operate,
including in-sourcing by commercial aerospace original equipment
manufacturers;
- our ability to successfully negotiate, or re-negotiate, future
pricing under our supply agreements with Boeing, Airbus and other
customers;
- our ability to effectively integrate the acquisition of select
assets of Bombardier along with other acquisitions that we pursue,
and generate synergies and other cost savings therefrom, while
avoiding unexpected costs, charges, expenses, and adverse changes
to business relationships and business disruptions;
- the possibility that our cash flows may not be adequate for our
additional capital needs;
- any reduction in our credit ratings;
- our ability to access the capital markets to fund our liquidity
needs, and the costs and terms of any additional financing;
- our ability to avoid or recover from cyber or other security
attacks and other operations disruptions;
- legislative or regulatory actions, both domestic and foreign,
impacting our operations, including the effect of changes in tax
laws and rates, and our ability to accurately calculate and
estimate the effect of such changes;
- our ability to recruit and retain a critical mass of highly
skilled employees;
- our relationships with the unions representing many of our
employees, including our ability to avoid labor disputes and work
stoppages with respect to our union employees;
- spending by the U.S. and other governments on defense;
- pension plan assumptions and future contributions;
- the effectiveness of our internal control over financial
reporting;
- the outcome or impact of ongoing or future litigation,
arbitration, claims, and regulatory actions or investigations,
including our exposure to potential product liability and warranty
claims;
- adequacy of our insurance coverage;
- our ability to continue selling certain receivables through our
supplier financing programs; and
- the risks of doing business internationally, including
fluctuations in foreign currency exchange rates, impositions of
tariffs or embargoes, trade restrictions, compliance with foreign
laws, and domestic and foreign government policies.
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. You
should review carefully the section captioned "Risk Factors" in the
Company's Annual Report on Form 10-K and the Company's Quarterly
Reports on Form 10-Q for a more complete discussion of these and
other factors that may affect our business.
Spirit Shipset
Deliveries
|
|
(one shipset
equals one aircraft)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4th
Quarter
|
|
Twelve
Months
|
|
|
|
2020
|
2019
|
|
2020
|
2019
|
|
B737
|
|
19
|
153
|
|
71
|
606
|
|
B747
|
|
2
|
1
|
|
6
|
6
|
|
B767
|
|
8
|
8
|
|
28
|
33
|
|
B777
|
|
9
|
12
|
|
39
|
56
|
|
B787
|
|
20
|
42
|
|
112
|
166
|
|
Total
Boeing
|
|
58
|
216
|
|
256
|
867
|
|
|
|
|
|
|
|
|
|
A220
|
|
11
|
14
|
|
43
|
40
|
|
A320
Family
|
|
101
|
172
|
|
466
|
682
|
|
A330
|
|
3
|
8
|
|
20
|
35
|
|
A350
|
|
11
|
30
|
|
62
|
111
|
|
A380
|
|
-
|
-
|
|
-
|
1
|
|
Total
Airbus
|
|
126
|
224
|
|
591
|
869
|
|
|
|
|
|
|
|
|
|
Business/Regional Jet
(1)
|
|
47
|
12
|
|
73
|
55
|
|
|
|
|
|
|
|
|
|
Total
|
|
231
|
452
|
|
920
|
1,791
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Beginning in the fourth quarter of
2020, includes Business/Regional Jet deliveries related to the
Bombardier acquisition
|
Spirit AeroSystems
Holdings, Inc.
|
Condensed
Consolidated Statements of Operations
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Twelve
Months Ended
|
|
|
|
December 31,
2020
|
|
December 31,
2019
|
|
December 31,
2020
|
|
December 31,
2019
|
|
|
($ in millions,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
$876.6
|
|
$1,959.3
|
|
$3,404.8
|
|
$7,863.1
|
Operating costs
and expenses:
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
904.5
|
|
1,757.3
|
|
3,845.5
|
|
6,786.4
|
Selling, general and
administrative
|
|
58.2
|
|
87.8
|
|
237.4
|
|
261.4
|
Restructuring
costs
|
|
4.6
|
|
-
|
|
73.0
|
|
-
|
Research and
development
|
|
10.7
|
|
18.5
|
|
38.8
|
|
54.5
|
Loss on disposal of
assets
|
|
-
|
|
-
|
|
22.9
|
|
-
|
|
Total operating
costs and expenses
|
|
978.0
|
|
1,863.6
|
|
4,217.6
|
|
7,102.3
|
|
Operating (loss)
income
|
|
(101.4)
|
|
95.7
|
|
(812.8)
|
|
760.8
|
Interest expense and
financing fee amortization
|
|
(61.5)
|
|
(25.8)
|
|
(195.3)
|
|
(91.9)
|
Other (expense)
income, net
|
|
(12.4)
|
|
6.1
|
|
(77.8)
|
|
(5.8)
|
|
(Loss) income
before income taxes and equity in net (loss) income of
affiliate
|
|
(175.3)
|
|
76.0
|
|
(1,085.9)
|
|
663.1
|
Income tax
(provision) benefit
|
|
(119.8)
|
|
(8.1)
|
|
220.2
|
|
(132.8)
|
|
(Loss) income
before equity in net (loss) income of affiliate
|
|
(295.1)
|
|
67.9
|
|
(865.7)
|
|
530.3
|
Equity in net loss of
affiliate
|
|
(0.8)
|
|
(0.2)
|
|
(4.6)
|
|
(0.2)
|
|
Net (loss)
income
|
|
($295.9)
|
|
$67.7
|
|
($870.3)
|
|
$530.1
|
|
|
|
|
|
|
|
|
|
|
(Loss) Earnings per
share
|
|
|
|
|
|
|
|
|
Basic
|
|
($2.85)
|
|
$0.65
|
|
($8.38)
|
|
$5.11
|
Shares
|
|
104.0
|
|
103.5
|
|
103.9
|
|
103.6
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
($2.85)
|
|
$0.65
|
|
($8.38)
|
|
$5.06
|
Shares
|
|
104.0
|
|
104.6
|
|
103.9
|
|
104.7
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per common share
|
|
$0.01
|
|
$0.12
|
|
$0.04
|
|
$0.48
|
Spirit AeroSystems
Holdings, Inc.
|
Condensed
Consolidated Balance Sheets
|
(unaudited)
|
|
|
December 31,
2020
|
|
December 31,
2019
|
|
|
($ in
millions)
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$1,873.3
|
|
$2,350.5
|
Restricted
cash
|
|
0.3
|
|
0.3
|
Accounts receivable,
net
|
|
484.4
|
|
546.4
|
Contract assets,
short-term
|
|
368.4
|
|
528.3
|
Inventory,
net
|
|
1,422.3
|
|
1,118.8
|
Other current
assets
|
|
336.3
|
|
98.7
|
Total current assets
|
|
4,485.0
|
|
4,643.0
|
Property, plant and
equipment, net
|
|
2,503.8
|
|
2,271.7
|
Intangible assets,
net
|
|
215.2
|
|
1.2
|
Goodwill
|
|
565.3
|
|
2.4
|
Right of use
assets
|
|
70.6
|
|
48.9
|
Contract assets,
long-term
|
|
4.4
|
|
6.4
|
Pension
assets
|
|
455.9
|
|
449.1
|
Deferred income
taxes
|
|
0.1
|
|
106.5
|
Other
assets
|
|
83.6
|
|
76.8
|
Total assets
|
|
$8,383.9
|
|
$7,606.0
|
Liabilities
|
|
|
|
|
Accounts
payable
|
|
$558.9
|
|
$1,058.3
|
Accrued
expenses
|
|
365.6
|
|
240.2
|
Profit
sharing
|
|
57.0
|
|
84.5
|
Current portion of
long-term debt
|
|
340.7
|
|
50.2
|
Operating lease
liabilities, short-term
|
|
5.5
|
|
6.0
|
Advance payments,
short-term
|
|
18.9
|
|
21.6
|
Contract liabilities,
short-term
|
|
97.6
|
|
158.3
|
Forward loss
provision, short-term
|
|
184.6
|
|
83.9
|
Deferred revenue and
other deferred credits, short-term
|
|
22.2
|
|
14.8
|
Other current
liabilities
|
|
58.4
|
|
42.9
|
Total current liabilities
|
|
1,709.4
|
|
1,760.7
|
Long-term
debt
|
|
3,532.9
|
|
2,984.1
|
Operating lease
liabilities, long-term
|
|
66.6
|
|
43.0
|
Advance payments,
long-term
|
|
327.4
|
|
333.3
|
Pension/OPEB
obligation
|
|
440.2
|
|
35.7
|
Contract liabilities,
long-term
|
|
372.0
|
|
356.3
|
Forward loss
provision, long-term
|
|
561.4
|
|
163.5
|
Deferred revenue and
other deferred credits, long-term
|
|
38.9
|
|
34.4
|
Deferred grant income
liability - non-current
|
|
28.1
|
|
29.0
|
Deferred income
taxes
|
|
13.0
|
|
8.3
|
Other non-current
liabilities
|
|
437.0
|
|
95.8
|
Stockholders'
Equity
|
|
|
|
|
Common stock,
Class A par value $0.01, 200,000,000 shares authorized,
105,542,162 and 104,882,379 shares issued and outstanding,
respectively
|
|
1.1
|
|
1.1
|
Additional paid-in
capital
|
|
1,139.8
|
|
1,125.0
|
Accumulated other
comprehensive loss
|
|
(154.1)
|
|
(109.2)
|
Retained
earnings
|
|
2,326.4
|
|
3,201.3
|
Treasury stock, at
cost (41,523,470 shares each period, respectively)
|
|
(2,456.7)
|
|
(2,456.8)
|
Total stockholders' equity
|
|
856.5
|
|
1,761.4
|
Noncontrolling
interest
|
|
0.5
|
|
0.5
|
Total equity
|
|
857.0
|
|
1,761.9
|
Total liabilities and equity
|
|
$8,383.9
|
|
$7,606.0
|
Spirit AeroSystems
Holdings, Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(unaudited)
|
|
|
|
|
|
|
|
For the Twelve
Months Ended
|
|
|
December 31,
2020
|
|
December 31,
2019
|
|
|
($ in
millions)
|
Operating
activities
|
|
|
|
|
Net (loss)
income
|
|
($870.3)
|
|
$530.1
|
Adjustments to
reconcile net (loss) income to net cash (used in) provided by
operating activities
|
|
|
Depreciation and
amortization expense
|
|
277.6
|
|
251.7
|
Amortization of deferred
financing fees
|
|
20.4
|
|
3.5
|
Accretion of customer supply
agreement
|
|
2.0
|
|
4.3
|
Employee stock compensation
expense
|
|
24.2
|
|
36.1
|
Loss from derivative
instruments
|
|
-
|
|
8.1
|
Loss from foreign currency
transactions
|
|
25.0
|
|
1.6
|
Loss on disposition of
assets
|
|
26.4
|
|
4.9
|
Deferred
taxes
|
|
94.0
|
|
86.1
|
Long term income tax
payable
|
|
1.5
|
|
-
|
Pension and other
post-retirement benefits, net
|
|
44.5
|
|
(20.0)
|
Grant income
|
|
(3.5)
|
|
(16.2)
|
Equity in net loss of
affiliates
|
|
4.6
|
|
0.2
|
Forward loss
provision
|
|
216.5
|
|
40.7
|
Changes in assets and
liabilities
|
|
|
|
|
Accounts receivable,
net
|
|
168.3
|
|
12.8
|
Contract assets
|
|
168.2
|
|
(5.2)
|
Inventory, net
|
|
(39.5)
|
|
(95.4)
|
Accounts payable and accrued
liabilities
|
|
(592.7)
|
|
34.6
|
Profit sharing/deferred
compensation
|
|
(28.2)
|
|
16.0
|
Advance payments
|
|
(21.0)
|
|
120.8
|
Income taxes
receivable/payable
|
|
(246.3)
|
|
(59.6)
|
Contract
liabilities
|
|
(49.5)
|
|
(13.0)
|
Deferred revenue and other
deferred credits
|
|
9.2
|
|
6.2
|
Other
|
|
23.7
|
|
(25.6)
|
Net
cash (used in) provided by operating activities
|
|
($744.9)
|
|
$922.7
|
Investing
activities
|
|
|
|
|
Purchase of property, plant
and equipment
|
|
(118.9)
|
|
(232.2)
|
Equity in assets of
affiliate
|
|
-
|
|
(7.9)
|
Acquisition, net of cash
acquired
|
|
(388.5)
|
|
-
|
Other
|
|
5.4
|
|
0.2
|
Net
cash used in investing activities
|
|
($502.0)
|
|
($239.9)
|
Financing
activities
|
|
|
|
|
Proceeds from issuance of
debt
|
|
400.0
|
|
250.0
|
Proceeds from issuance of
bonds
|
|
1,700.0
|
|
-
|
Proceeds from revolving
credit facility
|
|
-
|
|
900.0
|
Payments on revolving credit
facility
|
|
(800.0)
|
|
(100.0)
|
Customer
financing
|
|
10.0
|
|
-
|
Principal payments of
debt
|
|
(31.6)
|
|
(13.4)
|
Payments on term
loans
|
|
(439.7)
|
|
(16.6)
|
Taxes paid related to net
share settlement awards
|
|
(14.5)
|
|
(12.9)
|
Proceeds from issuance of
ESPP stock
|
|
2.6
|
|
2.6
|
Debt issuance and financing
costs
|
|
(41.9)
|
|
-
|
Purchase of treasury
stock
|
|
0.1
|
|
(75.8)
|
Dividends paid
|
|
(15.4)
|
|
(50.4)
|
Other
|
|
(0.1)
|
|
0.9
|
Net
cash provided by financing activities
|
|
$769.5
|
|
$884.4
|
Effect of exchange
rate changes on cash, cash equivalents, and restricted
cash
|
|
3.3
|
|
5.9
|
Net
(decrease) increase in cash, cash equivalents, and restricted
cash
|
|
($474.1)
|
|
$1,573.1
|
Cash, cash
equivalents, and restricted cash, beginning of the
period
|
|
2,367.2
|
|
794.1
|
Cash, cash
equivalents, and restricted cash, end of the period
|
|
$1,893.1
|
|
$2,367.2
|
|
|
|
|
|
Reconciliation of
Cash and Cash Equivalents and Restricted Cash:
|
|
December 31,
2020
|
|
December 31,
2019
|
Cash and cash
equivalents, beginning of the period
|
|
$2,350.5
|
|
$773.6
|
Restricted cash,
short-term, beginning of the period
|
|
0.3
|
|
0.3
|
Restricted cash,
long-term, beginning of the period
|
|
16.4
|
|
20.2
|
Cash, cash
equivalents, and restricted cash, beginning of the
period
|
|
$2,367.2
|
|
$794.1
|
|
|
|
|
|
Cash and cash
equivalents, end of the period
|
|
$1,873.3
|
|
$2,350.5
|
Restricted cash,
short-term, end of the period
|
|
$0.3
|
|
$0.3
|
Restricted cash,
long-term, end of the period
|
|
19.5
|
|
16.4
|
Cash, cash
equivalents, and restricted cash, end of the period
|
|
$1,893.1
|
|
$2,367.2
|
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
and (ii) 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 (Loss) Earnings Per Share. To provide
additional transparency, we have disclosed non-GAAP adjusted
diluted (loss) 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 (generally referred to herein as "cash from
operations"), less capital expenditures for property, plant and
equipment. Management believes Free Cash Flow provides investors
with an important perspective on the cash available for
stockholders, debt repayments including capital leases, 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. The most comparable GAAP measure is cash provided by
operating activities. Management uses Free Cash Flow as a measure
to assess both business performance and overall
liquidity.
The tables below provide reconciliations between the GAAP and
non-GAAP measures.
|
|
|
|
|
|
|
|
|
|
Adjusted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4th
Quarter
|
|
Twelve
Months
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted (Loss)
Earnings Per Share
|
|
($2.85)
|
|
$0.65
|
|
($8.38)
|
|
$5.06
|
|
Costs Related to
Planned Acquisitions
|
|
0.06
|
a
|
0.17
|
b
|
0.20
|
a
|
0.43
|
c
|
Restructuring
Costs
|
|
0.04
|
d
|
-
|
|
0.46
|
d
|
-
|
|
Voluntary Retirement
Program
|
|
-
|
|
(0.03)
|
f
|
0.55
|
e
|
0.05
|
f
|
Deferred Tax Asset
Valuation Allowance
|
|
1.44
|
g
|
-
|
|
1.45
|
g
|
-
|
|
Adjusted Diluted
(Loss) Earnings Per Share
|
|
($1.31)
|
|
$0.79
|
|
($5.72)
|
|
$5.54
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Shares (in
millions)
|
|
104.0
|
|
104.6
|
|
103.9
|
|
104.7
|
|
|
|
|
|
|
|
|
|
|
|
a
Represents the three and twelve months ended Q4 2020 transaction
costs (included in SG&A)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
b
Represents the three months ended Q4 2019 Asco acquisition impact
of $0.17 per share:
- Gains related to foreign currency fluctuation on Euro account of
$0.05 (included in Other expense)
- Transaction costs of $0.22 (included in SG&A)
|
|
|
|
|
|
|
|
|
|
|
|
c
Represents the twelve months ended Q4 2019 Asco acquisition
impact of $0.43 per share:
- Loss related to foreign currency forward contract of $0.13
(included in Other expense)
- Loss related to foreign currency fluctuation on Euro account of
$0.04 (included in Other expense)
- Transaction costs of $0.26 (included in SG&A)
|
|
|
|
|
|
|
|
|
|
|
|
d
Represents the three and twelve months ended Q4 2020 restructuring
expenses for cost-alignment and headcount reductions
(included in Restructuring costs)
|
|
|
|
|
|
|
|
|
|
|
e
Represents the twelve months ended Q4 2020 retirement incentive
expenses resulting from the VRP offered in 2020 (included
in
Other expense)
|
|
|
|
|
|
|
|
|
|
|
f
Represents the three and twelve months ended Q4 2019 retirement
incentive expenses resulting from the VRP offered in
2019 (included in Other expense)
|
|
|
g
Represents the three and twelve months ended Q4 2020 deferred tax
asset valuation allowance (included in Income tax
provision)
|
Free Cash
Flow
|
($ in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
4th
Quarter
|
|
Twelve
Months
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Cash from
Operations
|
|
($132)
|
|
$204
|
|
($745)
|
|
$923
|
Capital
Expenditures
|
|
(49)
|
|
(113)
|
|
(119)
|
|
(232)
|
Free Cash
Flow
|
|
($181)
|
|
$91
|
|
($864)
|
|
$691
|
*
|
Non-GAAP financial
measure, see Appendix for reconciliation
|
View original
content:http://www.prnewswire.com/news-releases/spirit-aerosystems-reports-fourth-quarter-and-full-year-2020-results-301233344.html
SOURCE Spirit AeroSystems