Spirit AeroSystems reports second-quarter operating loss of US$104.7 million

Spirit AeroSystems’ revenue in the second quarter of 2022 was US$1.3 billion, up 26% from the same period of 2021. This increase was primarily due to higher production deliveries on the Boeing 737 programme as well as increased aftermarket revenue, partially offset by lower production volume on the Boeing 787 programme. Overall deliveries increased to 318 shipsets during the second quarter of 2022 compared to 235 shipsets in the same period of 2021. This includes Boeing 737 deliveries of 71 shipsets compared to 35 shipsets in the same period of the prior year and Boeing 787 deliveries of four shipsets compared to 11 shipsets in the second quarter of 2021.

Spirit’s backlog at the end of the second quarter of 2022 was approximately US$34 billion, with work packages on all commercial platforms in the Airbus and Boeing backlog.  

Operating loss for the second quarter of 2022 was US$104.7 million, compared to operating loss of US$97.7 million in the same period of 2021. This increase in operating loss was primarily driven by higher changes in estimates and losses related to Russia sanctions recorded during the second quarter of 2022, partially offset by higher production on the Boeing 737 programme. Second-quarter 2022 earnings included net forward loss charges of US$63.7 million and unfavorable cumulative catch-up adjustments of US$8.0 million. The forward losses relate primarily to the Boeing 787 and Airbus A220 programmes. The forward loss on the Boeing 787 programme is driven by the impact of production rate decreases and increased supply chain and other costs. The Airbus A220 programme forward loss is associated with the bankruptcy of a supplier and costs to relocate the work. The unfavourable cumulative catch-up adjustments were primarily driven by schedule changes, parts shortages and increased estimates for supply chain, freight and other costs on the Boeing 737 and Airbus A320 programmes. In relation to the sanctioned Russian business activities, Spirit recorded losses of US$41.9 million as well as the reversal of a previously booked forward loss reserve of $13.8 million. Excess capacity costs recorded during the second quarter of 2022 were US$44.9 million. In comparison, during the second quarter of 2021, Spirit recorded US$52.2 million of net forward loss charges, favourable cumulative catch-up adjustments of US$9.9 million and excess capacity costs of US$47.5 million.

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