AviTrader sponsorship ad

Spirit AeroSystems posts second-quarter loss

© Spirit AeroSystems

Spirit AeroSystems‘ (Spirit) revenue in the second quarter of 2023 was US$1.4 billion, up 8% from the same period in 2022. This increase was primarily due to higher production on the 737 and 787 programmes and increased Defence and Space revenue, partially offset by lower revenue on the A220 programme.  

Overall deliveries increased to 342 shipsets during the second quarter of 2023 compared to 318 shipsets in the same period of 2022. This includes Boeing 737 deliveries of 74 shipsets compared to 71 shipsets in the same period of the prior year. Spirit's backlog at the end of the second quarter of 2023 was approximately US$40.5 billion, which includes work packages on all commercial platforms in the Airbus and Boeing backlog.  

Operating loss for the second quarter of 2023 was US$120.4 million, compared to operating loss of US$104.7 million in the same period of 2022. The change in operating loss was primarily driven by higher changes in estimates as well as contra revenue recorded for a potential customer claim, partially offset by the absence of losses related to Russia sanctions recognized during the second quarter of 2022 and increased aftermarket segment earnings.

Changes in estimates in the second quarter of 2023 included net forward loss charges of US$104.7 million and unfavourable cumulative catch-up adjustments for periods prior to the second quarter of US$21.6 million. The forward losses related primarily to the Boeing 787, and Airbus A220 programmes. The forward loss on the Boeing 787 programme of US$37.5 million was driven by the impacts of the new IAM union contract as well as increased supply chain and other costs. The Airbus programme forward loss of US$27.5 million was primarily due to increased costs related to production rate recovery efforts, including freight, as well as unfavourable foreign currency movements. The Airbus A220 programme forward loss of US$27.4 million was driven by higher estimates of supply chain costs and unfavourable foreign currency movement. The unfavourable cumulative catch-up adjustments related primarily to the Boeing 737 programme, reflecting increased labour costs resulting from the IAM union negotiations as well as higher supply chain costs.

Additionally, strike disruption charges of US$7.3 million were recorded to other operating expense on the Consolidated Statements of Operations. Excess capacity costs during the second quarter of 2023 were US$53.2 million. In comparison, during the second quarter of 2022, Spirit recognized US$63.7 million of net forward loss charges, US$8.0 million of unfavourable cumulative catch-up adjustments and excess capacity costs of US$44.9 million. Additionally, in second quarter of 2022, in relation to the sanctioned Russian business activities, Spirit recorded net losses of US$28.1 million.

Spirit estimates that Boeing has completed approximately half of its required rework on the 737 vertical fin attach fittings issue. The Company has recorded US$23.0 million of contra revenue in the second quarter of 2023 to account for a potential claim from Boeing for repair work to date at their facility. This estimate represents what Spirit believes to be the low end of the range of potential liability and the company cannot reasonably estimate the total potential claim it may receive from Boeing to complete the required repairs.

Cash used in operations in the second quarter of 2023 was US$183 million, compared to cash used in operations of US$62 million in the same quarter of 2022. Cash used in operations during the second quarter of 2023 reflects the negative impacts to working capital resulting from the rework and disruption related to the vertical fin attach fittings issue, the work stoppage caused by the IAM strike, and the preparation for increased production on the Boeing 737 programme. Additionally, the second- quarter 2023 cash used in operations included customer advances of US$50 million, as well as an excise tax payment of US$36 million related to the termination of the Pension Value Plan A (PVP A).

Free cash flow in the second quarter of 2023 was a usage of US$211 million, as compared to a usage of US$79 million in the same period of 2022. (£1.00 = US$1.27 at time of publication).

Share this Article
Monday June 17, 2024
NORD/LB Norddeutsche Landesbank has decided to exit the aircraft financing sector following a strategic review. As part of this decision, the bank has reached an agreement with Deutsche Bank to sell a substantial portion of its aircraft financing portfolio, va... Read More »
Monday June 17, 2024
Belgium has ordered 15 H145M helicopters
The Kingdom of Belgium has entered into a contract to procure 15 multi-role H145M helicopters for its army and two helicopters, plus three options, for its Federal Police. The agreement was signed between the NATO Support and Procurement Agency (NSPA), on beha... Read More »
Monday June 17, 2024
Kelly Horan
IAE International Aero Engines AG (IAE), a multinational consortium including shareholders such as RTX's Pratt & Whitney, Pratt & Whitney Aero Engines International GmbH, Japanese Aero Engines Corporation, and MTU Aero Engines AG, has announced the app... Read More »
Monday June 17, 2024
Lufthansa Cargo is expanding its operations at the southern German hub and will be operating freighters from Munich for the first time starting July 6, 2024. An A321 freighter will connect Munich with Istanbul Airport twice a week, complementing the existing b... Read More »
Monday June 17, 2024
Textron Aviation expands presence in Australia to modernise facilities and increase parts in the region
Textron Aviation is expanding its footprint in Australia to modernise facilities and increase Cessna, Beechcraft, and Hawker parts availability in the region. In addition, Premiair Aviation Maintenance, an Australian service centre acquired by Textron Aviation... Read More »
Monday June 17, 2024
Veryon, a prominent provider of information services and software solutions for the aviation industry, has been selected by Sharp Airlines to oversee its airworthiness, flight operations and maintenance activities. The Australian regional carrier now employs V... Read More »
Friday June 14, 2024
Guests witnessing the EH216-S pilotless eVTOL's debut flight in Saudi Arabia
EHang Holdings (EHang), an urban air mobility (UAM) technology platform company, has reported that its EH216-S pilotless electric vertical take-off and landing (eVTOL) aircraft completed its first autonomous air taxi flight in Mecca, Saudi Arabia. The autonomo... Read More »
Friday June 14, 2024
Skymark Airlines Boeing 737-800 © AirTeamImages
MRO service provider SR Technics has signed a five-year general terms of agreement with Skymark Airlines for exclusive rights to maintain Skymark's CFM56-7B engines. At the signing ceremony in Japan, Owen McClave, SR Technics' CEO, stated: “We are proud that... Read More »
Friday June 14, 2024
Ian Reason, SVP of Barnes and President of Barnes Aerospace and Irene Makris, VP Customer Service, Pratt & Whitney Canada signing the new agreement
Barnes Aerospace and RTX's Pratt & Whitney Canada (P&WC) have signed a long-term extension of their repair services agreement. As industry leaders in aerospace aftermarket solutions, the companies are committed to partnering on the maintenance, repair,... Read More »
Friday June 14, 2024
The U.S. Transportation Department has fined Emirates US$1.5 million for operating flights carrying JetBlue Airways' designator code in prohibited airspace. Between December 2021 and August 2022, Emirates operated numerous flights with the JetBlue Airways code... Read More »
Friday June 14, 2024
Representatives from Diehl Aviation and Skyways Technics at the signing ceremony
Representatives of Diehl Aviation and Skyways Technics HU Kft. (Skyways Technics) have signed an agreement at Diehl Aviation Hungary in Nyírbátor to cooperate in the maintenance of aircraft structural components, with Diehl Aviation's autoclaves playing a ce... Read More »
Friday June 14, 2024
François Fermaut
Vallair, the mature aircraft asset specialist dedicated to supporting operators and lessors, has released that François Fermaut has assumed the role of Sales and Business Development Manager for the aerostructures and engines divisions based in Châteauroux, ... Read More »
Thursday June 13, 2024
SITA Baggage IT Insights 2024 reports the number of bags mishandled by the industry falling from 7.6 to 6.9 per 1,000 passengers in 2023
SITA has reported an improvement in the air transport industry's rate of mishandled baggage. The newly launched SITA Baggage IT Insights 2024 reports the number of bags mishandled by the industry falling from 7.6 to 6.9 per 1,000 passengers in 2023. This is de... Read More »
Thursday June 13, 2024
Andy Smith newly appointed Chief Commercial Officer at flydocs
flydocs, a digital records and asset management solution provider for the aviation industry, has appointed Andy Smith as its Chief Commercial Officer and a member of the flydocs leadership team. Smith, an international sales and marketing professional, joins f... Read More »
Thursday June 13, 2024
Rendering of the new facility in Daytona Beach, Florida © Boeing
Boeing will operate a new engineering facility within the Cici & Hyatt Brown Center for Aerospace Technology at Embry-Riddle Aeronautical University in Daytona Beach, Florida. Initial plans for the location include Boeing employees performing engineering w... Read More »
Thursday June 13, 2024
JD Airlines 737-800 BDF aircraft
AerCap has signed lease agreements for four 737-800 Boeing Converted Freighter (BCF) aircraft with JD Airlines, the cargo airline of JD Logistics (also known as Jingdong Logistics). These aircraft are scheduled for delivery in 2024. The aircraft will be operat... Read More »
Thursday June 13, 2024
Pablo Canales, CEO of ©Americas GSA
Americas GSA, a subsidiary of ECS Group, has announced a strategic partnership with JetBlue Cargo. This collaboration marks a significant milestone, enhancing its services on domestic routes out of Florida. The contract commenced in February 2023 for Florida S... Read More »
Thursday June 13, 2024
Arajet Boeing 737 MAX © Boeing
Arajet's tenth Boeing 737 MAX arrived in Santo Domingo, Dominican Republic on June 11, as the airline continues to expand its fuel-efficient fleet. This 737-8 delivery, facilitated through a lessor, supports Arajet's growth strategy across the Americas, with p... Read More »
Wednesday June 12, 2024
Jack Diskin
Jackson Square Aviation (JSA), a full-service commercial aircraft lessor, has announced that Jack Diskin has been promoted to Senior Vice President, Head of Risk, effective June 1, 2024. Having joined JSA last year, Diskin brings a global perspective to risk m... Read More »
Wednesday June 12, 2024
Rendering of TriFan 600
XTI Aerospace has released that Mesa Air Group (Mesa), the holding company of regional air carrier Mesa Airlines, is the purchaser under a previously disclosed conditional purchase order with XTI Aircraft Company (XTI), a wholly owned subsidiary of XTI Aerospa... Read More »
AviTrader MRO magazine Mai 2024 edition


Aviation Media Pack

Subscribe to the most widely accepted news source in the aviation industry!

Free Daily, Weekly and MRO Publications delivered to your Inbox!
News Alerts, Editorials, Marketplace, Executive Interviews +more

Select publications:

*we respect your privacy and AviTrader will not share your email address to any 3rd Parties.

Scroll to Top
AviTrader Publications Corp.