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Spirit AeroSystems (SPR) Q3 Earnings Beat, Revenues Miss

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Spirit AeroSystems Holdings, Inc. (SPR - Free Report) reported third-quarter 2018 adjusted earnings of $1.70 per share, which surpassed the Zacks Consensus Estimate of $1.63 by 4.3%.

Barring one-time adjustments, the company reported GAAP earnings of $1.59 per share, compared with $1.26 in the year-ago quarter.

Highlights of the Release

Total revenues of $1,814 million missed the Zacks Consensus Estimate of $1,817 million by 0.2%. However, the top line rose 4% on a year-over-year basis.

Backlog at the end of third-quarter 2018 was $48 billion, up from the prior-quarter’s figure of $47 billion.

Segment Performance

Fuselage Systems: Revenues at the segment grew 3.6% to $991 million from $957 million in third-quarter 2017. Higher production deliveries on the Boeing 737 program and increased defense work drove the top line.

Propulsion Systems: The segment recorded revenues of $442.4 million in the quarter, up 8.5% from $407.9 million a year ago. The uptick can be attributed to higher propulsion deliveries on the Boeing 737 program.

Wing Systems: Revenues at the segment decreased 0.9% to $378.6 million from $382.2 million in the prior-year quarter. The downside was due tolower revenue recognized on the Boeing 787 program as a result of the adoption of ASC 606 and lower revenue recognized on the Airbus A350 program in accordance with pricing terms.

Financial Position

As of Sep 27, 2018, Spirit AeroSystems had $683.4 million in cash and cash equivalents compared with $423.3 as of Dec 31, 2017.

As of Sep 27, 2018, long-term debt (excluding current portion) totaled $1,869.7 million compared with $1,119.9 million at the end of 2017.

Cash flow from operating activities decreased to $567.4 million at the end of third-quarter 2018 from $624.6 million at the end of third-quarter 2017.

Capital expenditures summed $62 million compared with $51 million in the year-ago quarter.

Guidance

Spirit AeroSystems reiterated financial guidance for 2018. The company continues to expect adjusted earnings per share in the range of $6.10-$6.35 on revenues of $7.2-$7.3 billion.

Additionally, management continues to expect free cash flow in the $550-$575 million band for the current year.

Zacks Rank

Spirit AeroSystems currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Defense Releases

Curtiss-Wright (CW - Free Report) reported third-quarter 2018 adjusted earnings of $1.70 per share, which surpassed the Zacks Consensus Estimate of $1.58 by 7.6%. The company’s revenues of $595.4 million increased 5% year over year.

FLIR Systems’ third-quarter 2018 adjusted earnings of 57 cents per share came in line with the Zacks Consensus Estimate. Its revenues declined 6.4% year over year to $434.9 million.

Northrop Grumman Corporation (NOC - Free Report) delivered third-quarter 2018 earnings of $6.54 per share, beating the Zacks Consensus Estimate of $4.35 by 50.4%. The company recorded total revenues of $8.09 billion, marginally surpassing the Zacks Consensus Estimate of $8 billion by 1%.

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