Spirit AeroSystems posts loss on productivity woes
WICHITA, Kan. (AP) — Aerospace supplier Spirit AeroSystems Holdings Inc. on Thursday posted a third-quarter loss on charges due to production setbacks for several aircraft.
The Wichita, Kan., company booked $590 million in charges during the third quarter, which it announced last month. The complexity in developing some products drove up supplier, factory and labor costs, it said. The company also received a $235 million settlement from insurers for damage from an April storm that hit its Wichita plant, much less than the $400 million the company expected. The settlement partially offset the impact of the aircraft contract charges.
Spirit Aero Systems reported a net loss of $134 million, or 94 cents per share, compared with a profit of $67 million, or 47 cents per share, a year ago.
Revenue rose 21 percent to $1.37 billion.
Analysts expected a loss of 49 cents per share on revenue of $1.35 billion, according to FactSet.
"While new airplane programs are always challenging, I am extremely disappointed in our management of the complexity on these programs," CEO Jeff Turner said in a statement. "We have struggled with the development and early production on certain programs as highlighted by the charges in the quarter. However, it is important to note that as these programs are now transitioning to full rate production and experiencing rate increases we are applying our lessons learned and focusing on driving operational performance and cost improvement.
Pretax charges include $184 million for work on the Boeing 787, $163 million for the Gulfstream G650 business jet, $151 million on the BR725 Rolls Royce engine for business jets, $88 million on the Gulfstream G280, and $4 million on other programs.
Shares rose 45 cents, or 2.9 percent, to $16.08 in morning trading in morning trading amid a broad market rally.