(Reuters) – Spirit AeroSystems (SPR.N) on Tuesday reported a bigger-than-expected quarterly loss and pushed its target of becoming cash flow positive by another year, as top customers Boeing and Airbus slashed production due to a collapse in global travel.
Spirit said it now expects to generate positive cash flow in 2022, instead of 2021, and its current-quarter results will be further hit due to fresh production cuts announced in July by Boeing Co (BA.N) and Airbus SE (AIR.PA).
Boeing’s 787 Dreamliner and Airbus’ A350 are among the most profitable for the planemakers, but demand for the long-haul jets has sharply fallen due to the COVID-19 pandemic as cash-starved airlines defer deliveries to save money and stay in business.
Boeing, which accounts for nearly 80% of Spirit’s revenue, said last month it would cut 787 output to six units a month in 2021, the fourth such cut since last year when output touched a record 14 units a month.
Airbus SE (AIR.PA) also cut production of A350 to five jets a month last week, after dropping it to six from 9.5 in April.
Spirit booked $194.1 million in charges mainly related to the 787 and A350 cuts in the second quarter, and said will take another charge of about $46.5 million in the current quarter. The company’s total deliveries of shipsets, or complete sets of parts, sank about 65%, resulting in a 68% plunge in revenue for the quarter ended July 2, as the Boeing 737 MAX grounding also hurt.
Shares of Spirit fell as much as 8.9% to over two-month low of $17.76.
The company posted an adjusted loss of $2.28 per share in the quarter, compared with loss estimates of $1.33 per share.
Quarterly revenue came in at $644.6 million, below estimates of $863.2 million, according to IBES data from Refinitiv.
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