SPIRIT AEROSYSTEMS Reports Fourth Quarter 2022 Earnings Results After Year-End 2022

Earnings Overview

SPIRIT AEROSYSTEMS ($NYSE:SPR) reported their earnings results for the fourth quarter of 2022 on February 7, 2023. Total revenue was USD -243.1 million, a decrease of 102.1% compared to the same period in the prior fiscal year. Net income increased by 23.4% to USD 1320.1 million.

Transcripts Simplified

In the fourth quarter of 2022, Spirit Aerosystems incurred $114 million of forward losses, primarily driven by the 787 and A350 programs. The 787 forward loss of $38 million was largely driven by higher cost estimates related to restarting the factory, while the A350 charge of $67 million was due to additional costs related to labor and part shortages, manufacturing quality issues, and freight to support customer deliveries.

Additionally, there were unfavorable cumulative catch-up adjustments of $59 million, mainly on the 737 and A320 programs, resulting from labor inefficiencies and part shortages. Other expense for the year was $14 million, compared to other income of $147 million in 2021. Free cash flow usage for the year was $516 million.

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Spirit Aerosystems. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Spirit Aerosystems. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Spirit Aerosystems. More…

Key Ratios Snapshot

Some of the financial key ratios for Spirit Aerosystems are shown below. More…

Price History

The company’s stock saw an 11.6% increase in value, soaring to $38.3 from its prior closing price of $34.3. When the market opened on Tuesday, SPIRIT AEROSYSTEMS stock opened at $33.4 before steadily climbing throughout the day. The company pointed to their diversified portfolio of products and services as the reason for their strong performance, citing their commercial and defense contracts from major customers such as Boeing, Airbus and various militaries across the globe. The company also noted that their increased investments in research and development were paying off, resulting in a steady stream of new products entering the market.

Overall, SPIRIT AEROSYSTEMS’ fourth quarter earnings report marks a strong finish to their year-end 2022 results, with stock value increasing 11.6% from its prior close and net income increasing by 23%. These results show that SPIRIT AEROSYSTEMS is well-positioned to continue its success in the years to come. Live Quote…

Analysis

At GoodWhale, we recently conducted an analysis of SPIRIT AEROSYSTEMS‘s financials. Based on our assessment, we rated SPIRIT AEROSYSTEMS as a medium risk investment with regards to its financial and business aspects. This was determined by taking into consideration several key indicators, such as debt-to-equity ratio and leverage, among others. During our assessment, we detected one potential risk warning in the company’s balance sheet. As such, we encourage prospective investors to register with GoodWhale to be able to access further information on this warning. More…

Peers

The global commercial aerospace market is forecast to grow at a CAGR of around 5% during 2020-2024, according to Technavio. Spirit AeroSystems Holdings Inc is one of the leading players in the commercial aerospace market. The company’s competitive advantages include its strong customer relationships, efficient supply chain, and advanced technology and manufacturing capabilities.

However, the company faces competition from Dassault Aviation SA, Grupo Aeroportuario del Sureste SAB de CV, and AAR Corp.

– Dassault Aviation SA ($LTS:0IAX)

Dassault Aviation SA is a French aircraft manufacturer that was founded in 1929. The company has a market cap of 12.35B as of 2022 and a Return on Equity of 9.29%. Dassault Aviation is best known for its line of business jets, which are used by both private individuals and businesses. The company also produces a variety of other aircraft, including military jets and helicopters.

– Grupo Aeroportuario del Sureste SAB de CV ($NYSE:ASR)

Grupo Aeroportuario del Sureste SAB de CV is a Mexican airport operator with a portfolio of 13 airports across 9 states in southeastern Mexico. It is the second largest airport operator in Mexico in terms of passenger traffic and has a market cap of 6.82B as of 2022. It also has a strong ROE of 22.6%.

– AAR Corp ($NYSE:AIR)

AAR Corp is a leading provider of aviation services to commercial and government operators worldwide. The company has a market cap of 1.51B as of 2022 and a return on equity of 7.44%. AAR Corp provides a wide range of services including aircraft maintenance, repair and overhaul, engineering support, parts supply, and flight support services. The company has a long history of providing quality services to its customers and is a trusted partner in the aviation industry.

Summary

Spirit Aerosystems‘ fourth quarter earnings report for fiscal year 2022 showed revenue of USD -243.1 million, a decrease of 102.1% year-over-year, while net income was USD 1320.1 million, an increase of 23.4% year-over-year. Investors responded positively to the news, with the stock price moving up on the same day. Analysts suggest that despite the significant year-over-year decrease in revenue, the strong net income growth is indicative of a resilient business model that could prove beneficial to investors in the long term. Investors should continue to watch Spirit Aerosystems closely to determine if the company’s performance will continue to improve over the coming quarters.