Spirit AeroSystems (NYSE:SPR) reported its Q3 2023 results, revealing an adjusted loss of $1.42 per share, which was a narrower loss than consensus estimates but wider than the loss reported in the same period last year. The GAAP loss was $1.94 per share. Total revenues stood at $1,439 million, marking a 13% year-over-year (YoY) increase due to higher production deliveries and increased Defense and Space and Aftermarket revenues, albeit lower than the consensus estimate by 0.2%.
The company's backlog at the end of Q3 2023 was $42.2 billion, up from the previous quarter's $40.5 billion. The Commercial Segment witnessed a 9.8% YoY increase in revenues to $1,136.4 million due to higher production across most programs. However, the operating loss in this segment widened to $82.1 million.
Revenues in the Defense & Space segment rose by 27.2% YoY to $205.7 million because of increased activity on development programs and higher production on the KC-46 Tanker program, but operating income decreased 46.7% to $9.8 million.
The Aftermarket segment's top line improved by 21% YoY to $96.8 million due to higher spare part sales, but its operating profit decreased 8.2% YoY to $17.9 million.
Total operating costs and expenses for Spirit AeroSystems surged 23.6% YoY to $1,572.6 million due to higher cost of sales and restructuring costs, resulting in an operating loss of $133.7 million.
As of September 28, 2023, Spirit AeroSystems had cash and cash equivalents amounting to $374.1 million, a significant decrease from $658.6 million as of December 31, 2022. The company also reported a long-term debt of $3,811 million.
The company's performance missed consensus estimates on both earnings and revenues for the third quarter of 2023.
InvestingPro Insights
According to InvestingPro, Spirit AeroSystems (SPR) operates with a significant debt burden which aligns with the reported long-term debt of $3,811 million. This could potentially pose a risk for the company as it may have trouble making interest payments on the debt. Additionally, the company has been aggressively buying back shares, which could be a strategy to boost the stock price or to consolidate ownership.
InvestingPro data highlights that the company's Market Cap is $2570M USD and the P/E Ratio is -2.54, which indicates that the company is not profitable. This is in line with the InvestingPro Tip that analysts do not anticipate the company will be profitable this year. The Revenue Growth over the last twelve months as of Q2 2023 is 20.31%, which is a positive sign, but it's worth noting that the revenue growth has been slowing down recently.
InvestingPro also offers numerous additional tips for understanding the market and making informed investment decisions. For instance, the product includes tips on other aspects of SPR's financial health and performance, such as its earnings, cash flow, return on assets, and more.
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