Hexcel Corporation
Two Stamford Plaza | 281 Tresser Blvd., 16thFloor
Stamford, CT 06901 USA
www.hexcel.com
Exhibit 99.1
HEXCEL REPORTS 2021 FOURTH QUARTER AND FULL YEAR RESULTS
Q4 2021 GAAP diluted EPS of $0.22 and adjusted diluted EPS of $0.16, compared to Q4 2020 GAAP diluted EPS of ($0.23) and adjusted diluted EPS of ($0.18). Q4 2021 Sales were $360.3 million, compared to $295.8 million in Q4 2020. FY 2021 GAAP diluted EPS of $0.19 and adjusted diluted EPS of $0.27, compared to FY 2020 GAAP diluted EPS of $0.38 and adjusted diluted EPS of $0.25. FY 2021 Sales were $1,325 million, compared to $1,502 million for FY 2020. Free Cash Flow of $124 million in FY 2021. Reinstating quarterly dividend. |
See Table C for reconciliation of GAAP and non-GAAP operating income (loss), net income (loss), earnings (loss) per share and operating cash flow to free cash flow. Free cash flow is cash from operations less capital expenditures.
Summary of Results from Operations |
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Quarters Ended |
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Years Ended |
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December 31, |
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December 31, |
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(In millions, except per share data) |
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2021 |
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2020 |
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% Change |
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2021 |
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2020 |
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% Change |
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Net Sales |
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$ |
360.3 |
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$ |
295.8 |
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21.8 |
% |
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$ |
1,324.7 |
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$ |
1,502.4 |
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(11.8 |
)% |
Net sales change in constant currency |
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23.0 |
% |
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(12.6 |
)% |
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Operating Income (Loss) |
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23.0 |
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(20.4 |
) |
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212.7 |
% |
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51.8 |
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14.1 |
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267.4 |
% |
Net Income (Loss) |
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18.9 |
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(19.4 |
) |
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197.4 |
% |
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16.1 |
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31.7 |
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(49.2 |
)% |
Diluted net income (loss) per common share |
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$ |
0.22 |
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$ |
(0.23 |
) |
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195.7 |
% |
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$ |
0.19 |
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$ |
0.38 |
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(50.0 |
)% |
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Non-GAAP measures for year-over-year comparison (Table C) |
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Adjusted Operating Income (Loss) |
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$ |
25.2 |
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$ |
(6.1 |
) |
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513.1 |
% |
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$ |
70.0 |
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$ |
72.0 |
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(2.8 |
)% |
As a % of sales |
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7.0 |
% |
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(2.1 |
)% |
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5.3 |
% |
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4.8 |
% |
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Adjusted Net Income (Loss) |
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13.5 |
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(15.2 |
) |
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188.8 |
% |
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23.2 |
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20.6 |
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12.6 |
% |
Adjusted diluted net income (loss) per share |
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$ |
0.16 |
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$ |
(0.18 |
) |
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188.9 |
% |
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$ |
0.27 |
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$ |
0.25 |
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8.0 |
% |
1
STAMFORD, Conn. January 26, 2022 – Hexcel Corporation (NYSE: HXL) today reported fourth quarter 2021 results including net sales of $360 million and adjusted diluted EPS of $0.16 per share.
Chairman, CEO and President Nick Stanage said, "Our fourth quarter 2021 commercial aerospace sales grew more than fifty percent compared to the fourth quarter of 2020 with growth across the spectrum of aircraft programs including narrowbody, widebody and business jets. We see airlines looking beyond the pandemic as they place new aircraft orders to upgrade and expand their fleets with modern lightweight aircraft to support their objectives for improved fuel efficiency and emissions reduction. As the secular penetration of advanced composites continues and gains momentum, there is a compelling economic and environmental case for the lightweighting materials and products provided by Hexcel. During the pandemic we have continued our focus on internal sustainability initiatives and we recently issued targets for reducing our emissions, landfill waste and water usage by 2030 as well as continuing to enhance our strong safety culture.”
Mr. Stanage continued, “We achieved another quarter of sequential growth in our sales and adjusted earnings per share in the fourth quarter of 2021. As our end market recovery is becoming more robust, we are providing financial guidance for 2022, recognizing that some challenges still remain. We continue to tightly manage costs and expect to expand margins in 2022 on growing sales as we re-utilize existing capacity that has been idled during the pandemic. We forecast continued sales growth, earnings expansion and strong free cash flow generation for 2022. Lastly, reflecting our growing confidence and positive outlook, I am pleased to announce that the Board of Directors has re-instituted a quarterly dividend.”
Markets
Sales in the fourth quarter of 2021 were $360.3 million compared to $295.8 million in the fourth quarter of 2020.
Commercial Aerospace
Space & Defense
Industrial
2
Consolidated Operations
Gross margin for the fourth quarter was 19.2% compared to 10.3% in the prior year period as increased sales reduced the under-absorption of fixed overhead. As a percentage of sales, selling, general and administrative and R&T expenses for the fourth quarter of 2021 were 12.2% compared to 12.3% for the fourth quarter of 2020. Other operating expenses for the fourth quarter included charges for vaccination incentives and restructuring. Other operating expenses for the fourth quarter of 2020 were primarily restructuring charges. Adjusted operating income in the fourth quarter of 2021 was $25.2 million or 7.0% of sales, compared to an adjusted operating loss of $6.1 million, or (2.1%) of sales in 2020. Other income for the fourth quarter included the receipt of $10.5 million related to the Aviation Manufacturing Jobs Protection ("AMJP") program. This benefit is excluded from adjusted EPS. The impact of exchange rates on operating income as a percent of sales was favorable by approximately one hundred basis points in the fourth quarter of 2021 compared to 2020.
FY 2021 Results
Full year sales were $1,324.7 million, a decrease of 11.8% (12.6% in constant currency) compared to 2020.
Commercial Aerospace (50% of YTD sales)
Space & Defense (33% of YTD sales)
Industrial (17% of YTD sales)
Consolidated Operations
Gross margin for 2021 was 18.9% compared to 16.0% in the prior year. As a percentage of sales, selling, general and administrative and R&T expenses for 2021 were 13.6% compared to 11.2% for 2020 as the prior year period included temporary cost reduction actions in response to the pandemic. Other operating expenses for 2021 were $18.2 million and included expense primarily related to severance and restructuring. Other operating expenses for 2020 were $57.9 million and included expenses related to severance and the terminated merger with Woodward, Inc. Adjusted operating income for 2021 was $70.0 million, or 5.3% of sales, compared to $72.0 million, or 4.8% of sales in 2020. The impact of exchange rates on operating income as a percent of sales for 2021 was favorable by approximately sixty basis points compared to 2020.
3
Cash, 2022 Guidance Update and other
2022 Guidance
*****
Hexcel will host a conference call at 10:00 a.m. ET, on January 27, 2022 to discuss fourth quarter and full-year 2021 results. The event will be webcast via the Investor Relations webpage at www.Hexcel.com. The event can also be accessed by dialing +1 (646) 960-0452. The conference ID is 3428143. Replays of the call will be available on the website.
*****
About Hexcel
Hexcel Corporation is a global leader in advanced lightweight composites technology. We propel the future of flight, energy generation, transportation, and recreation through excellence in providing innovative high-performance material solutions that are lighter, stronger and tougher, helping to create a better world for us all. Our broad and unrivaled product range includes carbon fiber, specialty reinforcements, prepregs and other fiber-reinforced matrix materials, honeycomb, resins, engineered core and composite structures for use in commercial aerospace, space and defense, and industrial applications
*****
4
Disclaimer on Forward Looking Statements
This news release contains statements that are forward looking within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the estimates and expectations based on aircraft production rates provided by Airbus, Boeing and others; the revenues we may generate from an aircraft model or program; the impact of the push-out in deliveries of the Airbus and Boeing backlog and the impact of delays in the startup or ramp-up of new aircraft programs or the final Hexcel composite material content once the design and material selection have been completed; expectations with regard to regulatory clearances or the build rate of the Boeing 737 MAX or Boeing 787 and the related impact on our revenues; expectations with regard to raw material cost and availability; expectations of composite content on new commercial aircraft programs and our share of those requirements; expectations regarding revenues from space and defense applications, including whether certain programs might be curtailed or discontinued; expectations regarding sales for wind energy, recreation, automotive and other industrial applications; expectations regarding working capital trends and expenditures and inventory levels; expectations as to the level of capital expenditures and completion of capacity expansions and qualification of new products; expectations regarding our ability to improve and maintain margins; projections regarding our tax rate; expectations with regard to the continued impact of the COVID-19 pandemic on worldwide air travel and aircraft programs, as well as on our customers and suppliers and, in turn, on our operations and financial results; and the anticipated impact of the above factors and various market risks on our expectations of financial results for 2022 and beyond. Actual results may differ materially from the results anticipated in the forward looking statements due to a variety of factors, including but not limited to the impact of the COVID-19 pandemic, including continued disruption in global financial markets and supply chains, ongoing restrictions on movement and travel, employee absenteeism and labor shortages, the impact of any vaccine mandate, and reduced demand for air travel, on the operations, business and financial condition of Hexcel and its customers and suppliers; reductions in sales to any significant customers, particularly Airbus or Boeing, including related to the timing of pending regulatory clearances for the Boeing 737 MAX and the Boeing 787, as well as due to the impact of the COVID-19 pandemic; inability to effectively adjust production and inventory levels to align with customer demand; inability to effectively motivate, retain and hire the necessary workforce, including potential employee attrition resulting from any vaccine mandate; our ability to successfully implement or realize our business strategies, plans and objectives of management, including any restructuring or alignment activities in which we may engage; the impact of any government mandated COVID-19 precautions, including mandatory vaccination; changes in sales mix; changes in current pricing and cost levels, including cost inflation; changes in aerospace delivery rates; changes in government defense procurement budgets; changes in military aerospace program technology; timely new product development or introduction; industry capacity; increased competition; availability and cost of raw materials, including the impact of supply shortages and inflation; supply chain disruptions; inability to install, staff and qualify necessary capacity or complete capacity expansions to meet customer demand; cybersecurity-related risks including the potential impact of breaches or intrusions; currency exchange rate fluctuations; changes in political, social and economic conditions, including, but not limited to, the effect of change in global trade policies; work stoppages or other labor disruptions; our ability to successfully complete any strategic acquisitions, investments or dispositions; compliance with environmental, health, safety and other related laws and regulations, including those related to climate change; the effects of natural disasters, which may be worsened by the impact of climate change, and other severe catastrophic events; the potential impact of environmental, social and governance matters; and the unexpected outcome of legal matters or impact of changes in laws or regulations. Additional risk factors are described in our filings with the Securities and Exchange Commission. We do not undertake an obligation to update our forward-looking statements to reflect future events.
Contact
Kurt Goddard | Vice President Investor Relations | Kurt.Goddard@Hexcel.com | +1 (203)-352-6826
*****
5
Hexcel Corporation and Subsidiaries |
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Condensed Consolidated Statements of Operations |
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Unaudited |
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Quarters Ended |
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Years Ended |
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December 31, |
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December 31, |
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(In millions, except per share data) |
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2021 |
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2020 |
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2021 |
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2020 |
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Net sales |
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$ |
360.3 |
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$ |
295.8 |
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$ |
1,324.7 |
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$ |
1,502.4 |
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Cost of sales |
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291.2 |
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265.4 |
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1,074.6 |
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1,262.7 |
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Gross margin |
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69.1 |
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30.4 |
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250.1 |
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239.7 |
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% Gross Margin |
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19.2 |
% |
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10.3 |
% |
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18.9 |
% |
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16.0 |
% |
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Selling, general and administrative expenses |
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32.3 |
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25.9 |
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135.0 |
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121.1 |
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Research and technology expenses |
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11.6 |
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10.6 |
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45.1 |
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46.6 |
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Other operating expense |
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2.2 |
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14.3 |
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18.2 |
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57.9 |
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Operating income (loss) |
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23.0 |
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(20.4 |
) |
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51.8 |
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14.1 |
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Interest expense, net |
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9.2 |
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9.4 |
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38.3 |
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41.8 |
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Other income |
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(8.5 |
) |
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- |
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(8.5 |
) |
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- |
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Income (loss) before income taxes, and equity in earnings of affiliated companies |
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22.3 |
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(29.8 |
) |
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22.0 |
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(27.7 |
) |
Income tax expense (benefit) |
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4.3 |
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(12.3 |
) |
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5.9 |
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(61.0 |
) |
Income (loss) before equity in earnings of affiliated companies |
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18.0 |
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(17.5 |
) |
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16.1 |
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33.3 |
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Equity in earnings (losses) from affiliated companies |
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0.9 |
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(1.9 |
) |
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- |
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(1.6 |
) |
Net income (loss) |
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$ |
18.9 |
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$ |
(19.4 |
) |
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$ |
16.1 |
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$ |
31.7 |
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Basic net income (loss) per common share: |
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$ |
0.22 |
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$ |
(0.23 |
) |
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$ |
0.19 |
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$ |
0.38 |
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Diluted net income (loss) per common share: |
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$ |
0.22 |
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$ |
(0.23 |
) |
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$ |
0.19 |
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$ |
0.38 |
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Weighted-average common shares: |
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Basic |
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84.2 |
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83.8 |
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84.1 |
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83.8 |
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Diluted |
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84.8 |
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83.8 |
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84.6 |
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84.0 |
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6
Hexcel Corporation and Subsidiaries |
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Condensed Consolidated Balance Sheets |
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Unaudited |
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December 31, |
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December 31, |
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(In millions) |
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2021 |
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2020 |
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Assets |
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Cash and cash equivalents |
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$ |
127.7 |
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$ |
103.3 |
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Accounts receivable, net |
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160.3 |
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|
125.4 |
|
Inventories, net |
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245.7 |
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|
213.5 |
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Contract assets |
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30.5 |
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43.1 |
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Prepaid expenses and other current assets |
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39.5 |
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|
38.0 |
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Assets held for sale |
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12.6 |
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|
12.6 |
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Total current assets |
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616.3 |
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535.9 |
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Property, plant and equipment |
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3,110.0 |
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3,139.7 |
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Less accumulated depreciation |
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(1,363.9 |
) |
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(1,265.5 |
) |
Net property, plant and equipment |
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1,746.1 |
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1,874.2 |
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Goodwill and other intangible assets, net |
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267.5 |
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277.8 |
|
Investments in affiliated companies |
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44.6 |
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44.7 |
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Other assets |
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144.9 |
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185.2 |
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Total assets |
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$ |
2,819.4 |
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$ |
2,917.8 |
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Liabilities and Stockholders' Equity |
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Liabilities: |
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Short-term borrowings |
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$ |
0.9 |
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$ |
0.9 |
|
Accounts payable |
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|
113.2 |
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|
70.0 |
|
Accrued compensation and benefits |
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|
54.4 |
|
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|
43.2 |
|
Accrued liabilities |
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|
79.1 |
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|
69.0 |
|
Total current liabilities |
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247.6 |
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|
183.1 |
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Long-term debt |
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|
822.4 |
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|
925.5 |
|
Retirement obligations |
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|
52.6 |
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|
53.9 |
|
Other non-current liabilities |
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|
211.3 |
|
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|
245.1 |
|
Total liabilities |
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$ |
1,333.9 |
|
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$ |
1,407.6 |
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Stockholders' equity: |
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||
Common stock, $0.01 par value, 200.0 shares authorized, |
|
$ |
1.1 |
|
|
$ |
1.1 |
|
Additional paid-in capital |
|
|
878.6 |
|
|
|
849.7 |
|
Retained earnings |
|
|
2,012.5 |
|
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|
1,996.4 |
|
Accumulated other comprehensive loss |
|
|
(126.5 |
) |
|
|
(59.6 |
) |
|
|
|
2,765.7 |
|
|
|
2,787.6 |
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||
Less – Treasury stock, at cost, 26.1 shares at both December 31, 2021 and December 31, 2020 |
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|
(1,280.2 |
) |
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|
(1,277.4 |
) |
Total stockholders' equity |
|
|
1,485.5 |
|
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|
1,510.2 |
|
Total liabilities and stockholders' equity |
|
$ |
2,819.4 |
|
|
$ |
2,917.8 |
|
7
Hexcel Corporation and Subsidiaries |
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Condensed Consolidated Statements of Cash Flows |
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Unaudited |
|
|||||
|
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Years Ended |
|
|||||
|
|
December 31, |
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|||||
(In millions) |
|
2021 |
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2020 |
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Cash flows from operating activities |
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Net income |
|
$ |
16.1 |
|
|
$ |
31.7 |
|
Reconciliation to net cash provided by operating activities: |
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||
Depreciation and amortization |
|
|
138.0 |
|
|
|
140.9 |
|
Amortization related to financing |
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|
3.1 |
|
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|
1.2 |
|
Deferred income taxes |
|
|
(2.6 |
) |
|
|
(51.4 |
) |
Equity in earnings from affiliated companies |
|
|
- |
|
|
|
1.6 |
|
Stock-based compensation |
|
|
19.0 |
|
|
|
15.4 |
|
Merger and restructuring expenses, net of payments |
|
|
(5.6 |
) |
|
|
23.0 |
|
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||
Changes in assets and liabilities: |
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||
(Increase) decrease in accounts receivable |
|
|
(40.7 |
) |
|
|
110.0 |
|
(Increase) decrease in inventories |
|
|
(40.4 |
) |
|
|
129.4 |
|
Decrease in prepaid expenses and other current assets |
|
|
13.0 |
|
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|
11.2 |
|
Increase (decrease) in accounts payable/accrued liabilities |
|
|
49.8 |
|
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|
(134.1 |
) |
Other - net |
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|
2.0 |
|
|
|
(14.6 |
) |
Net cash provided by operating activities (a) |
|
|
151.7 |
|
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|
264.3 |
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Cash flows from investing activities |
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Capital expenditures (b) |
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|
(27.9 |
) |
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|
(50.6 |
) |
Net cash used for investing activities |
|
|
(27.9 |
) |
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|
(50.6 |
) |
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|
||
Cash flows from financing activities |
|
|
|
|
|
|
||
Net repayments from senior unsecured credit facilities |
|
|
(103.0 |
) |
|
|
(85.0 |
) |
Repayments of Euro term loan |
|
|
- |
|
|
|
(49.9 |
) |
Repayment of finance lease obligation and other debt, net |
|
|
(0.9 |
) |
|
|
(0.2 |
) |
Issuance costs related to senior credit facility |
|
|
|
|
|
(1.3 |
) |
|
Dividends paid |
|
|
- |
|
|
|
(14.2 |
) |
Repurchase of stock |
|
|
- |
|
|
|
(24.6 |
) |
Activity under stock plans |
|
|
7.1 |
|
|
|
(3.3 |
) |
Net cash used for financing activities |
|
|
(96.8 |
) |
|
|
(178.5 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
(2.6 |
) |
|
|
3.7 |
|
Net increase in cash and cash equivalents |
|
|
24.4 |
|
|
|
38.9 |
|
Cash and cash equivalents at beginning of period |
|
|
103.3 |
|
|
|
64.4 |
|
Cash and cash equivalents at end of period |
|
$ |
127.7 |
|
|
$ |
103.3 |
|
|
|
|
|
|
|
|
||
Supplemental data: |
|
|
|
|
|
|
||
Free Cash Flow (a)+(b) |
|
$ |
123.8 |
|
|
$ |
213.7 |
|
Accrual basis additions to property, plant and equipment |
|
$ |
41.4 |
|
|
$ |
42.5 |
|
8
Hexcel Corporation and Subsidiaries |
|
|||||||||||||||||||||||
Net Sales to Third-Party Customers by Market |
|
|||||||||||||||||||||||
Quarters Ended December 31, 2021 and 2020 |
Unaudited |
|
|
|
|
|
Table A |
|
||||||||||||||||
(In millions) |
|
As Reported |
|
|
Constant Currency (a) |
|
||||||||||||||||||
|
|
|
|
|
|
|
|
B/(W) |
|
|
FX |
|
|
|
|
|
B/(W) |
|
||||||
Market |
|
2021 |
|
|
2020 |
|
|
% |
|
|
Effect (b) |
|
|
2020 |
|
|
% |
|
||||||
Commercial Aerospace |
|
$ |
199.7 |
|
|
$ |
126.7 |
|
|
|
57.6 |
|
|
$ |
(0.9 |
) |
|
$ |
125.8 |
|
|
|
58.7 |
|
Space & Defense |
|
|
105.9 |
|
|
|
119.7 |
|
|
|
(11.5 |
) |
|
|
(1.0 |
) |
|
|
118.7 |
|
|
|
(10.8 |
) |
Industrial |
|
|
54.7 |
|
|
|
49.4 |
|
|
|
10.7 |
|
|
|
(0.9 |
) |
|
|
48.5 |
|
|
|
12.8 |
|
Consolidated Total |
|
$ |
360.3 |
|
|
$ |
295.8 |
|
|
|
21.8 |
|
|
$ |
(2.8 |
) |
|
$ |
293.0 |
|
|
|
23.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Consolidated % of Net Sales |
|
% |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|
||||||
Commercial Aerospace |
|
|
55.4 |
|
|
|
42.8 |
|
|
|
|
|
|
|
|
|
42.9 |
|
|
|
|
|||
Space & Defense |
|
|
29.4 |
|
|
|
40.5 |
|
|
|
|
|
|
|
|
|
40.5 |
|
|
|
|
|||
Industrial |
|
|
15.2 |
|
|
|
16.7 |
|
|
|
|
|
|
|
|
|
16.6 |
|
|
|
|
|||
Consolidated Total |
|
|
100.0 |
|
|
|
100.0 |
|
|
|
|
|
|
|
|
|
100.0 |
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Years Ended December 31, 2021 and 2020 |
Unaudited |
|
|
|
|
|
|
|
||||||||||||||||
(In millions) |
|
As Reported |
|
|
Constant Currency (a) |
|
||||||||||||||||||
|
|
|
|
|
|
|
|
B/(W) |
|
|
FX |
|
|
|
|
|
B/(W) |
|
||||||
Market |
|
2021 |
|
|
2020 |
|
|
% |
|
|
Effect (b) |
|
|
2020 |
|
|
% |
|
||||||
Commercial Aerospace |
|
$ |
668.2 |
|
|
$ |
822.3 |
|
|
|
(18.7 |
) |
|
$ |
3.2 |
|
|
$ |
825.5 |
|
|
|
(19.1 |
) |
Space & Defense |
|
|
434.9 |
|
|
|
448.5 |
|
|
|
(3.0 |
) |
|
|
1.8 |
|
|
|
450.3 |
|
|
|
(3.4 |
) |
Industrial |
|
|
221.6 |
|
|
|
231.6 |
|
|
|
(4.3 |
) |
|
|
7.5 |
|
|
|
239.1 |
|
|
|
(7.3 |
) |
Consolidated Total |
|
$ |
1,324.7 |
|
|
$ |
1,502.4 |
|
|
|
(11.8 |
) |
|
$ |
12.5 |
|
|
$ |
1,514.9 |
|
|
|
(12.6 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Consolidated % of Net Sales |
|
% |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
|
||||||
Commercial Aerospace |
|
|
50.5 |
|
|
|
54.7 |
|
|
|
|
|
|
|
|
|
54.5 |
|
|
|
|
|||
Space & Defense |
|
|
32.8 |
|
|
|
29.9 |
|
|
|
|
|
|
|
|
|
29.7 |
|
|
|
|
|||
Industrial |
|
|
16.7 |
|
|
|
15.4 |
|
|
|
|
|
|
|
|
|
15.8 |
|
|
|
|
|||
Consolidated Total |
|
|
100.0 |
|
|
|
100.0 |
|
|
|
|
|
|
|
|
|
100.0 |
|
|
|
|
|||
9
Hexcel Corporation and Subsidiaries |
|
|||||||||||||||
Segment Information |
|
Unaudited |
|
|
Table B |
|
||||||||||
(In millions) |
|
Composite Materials |
|
|
Engineered Products |
|
|
Corporate |
|
|
Total |
|
||||
Fourth Quarter 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales to external customers |
|
$ |
287.2 |
|
|
$ |
73.1 |
|
|
$ |
- |
|
|
$ |
360.3 |
|
Intersegment sales |
|
|
13.9 |
|
|
|
0.6 |
|
|
|
(14.5 |
) |
|
|
- |
|
Total sales |
|
|
301.1 |
|
|
|
73.7 |
|
|
|
(14.5 |
) |
|
|
360.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operating expense |
|
|
1.5 |
|
|
|
0.6 |
|
|
|
0.1 |
|
|
|
2.2 |
|
Operating income (loss) |
|
|
26.2 |
|
|
|
3.1 |
|
|
|
(6.3 |
) |
|
|
23.0 |
|
% Operating margin |
|
|
8.7 |
% |
|
|
4.2 |
% |
|
|
|
|
|
6.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
32.0 |
|
|
|
3.6 |
|
|
|
- |
|
|
|
35.6 |
|
Stock-based compensation expense |
|
|
4.8 |
|
|
|
1.1 |
|
|
|
(3.1 |
) |
|
|
2.8 |
|
Accrual based additions to capital expenditures |
|
|
25.0 |
|
|
|
2.1 |
|
|
|
- |
|
|
|
27.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fourth Quarter 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales to external customers |
|
$ |
225.5 |
|
|
$ |
70.3 |
|
|
$ |
- |
|
|
$ |
295.8 |
|
Intersegment sales |
|
|
5.9 |
|
|
|
0.9 |
|
|
|
(6.8 |
) |
|
|
- |
|
Total sales |
|
|
231.4 |
|
|
|
71.2 |
|
|
|
(6.8 |
) |
|
|
295.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operating expense |
|
|
6.6 |
|
|
|
7.1 |
|
|
|
0.6 |
|
|
|
14.3 |
|
Operating (loss) income |
|
|
(14.3 |
) |
|
|
6.1 |
|
|
|
(12.2 |
) |
|
|
(20.4 |
) |
% Operating margin |
|
|
(6.2 |
)% |
|
|
8.6 |
% |
|
|
|
|
|
(6.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
31.2 |
|
|
|
3.7 |
|
|
|
- |
|
|
|
34.9 |
|
Stock-based compensation expense |
|
|
1.2 |
|
|
|
0.2 |
|
|
|
1.0 |
|
|
|
2.4 |
|
Accrual based additions to capital expenditures |
|
|
3.2 |
|
|
|
(0.1 |
) |
|
|
- |
|
|
|
3.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Year Ended December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales to external customers |
|
$ |
1,019.4 |
|
|
$ |
305.3 |
|
|
$ |
- |
|
|
$ |
1,324.7 |
|
Intersegment sales |
|
|
56.7 |
|
|
|
2.4 |
|
|
|
(59.1 |
) |
|
|
- |
|
Total sales |
|
|
1,076.1 |
|
|
|
307.7 |
|
|
|
(59.1 |
) |
|
|
1,324.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operating expense |
|
|
17.8 |
|
|
|
0.1 |
|
|
|
0.3 |
|
|
|
18.2 |
|
Operating income (loss) |
|
|
88.1 |
|
|
|
20.2 |
|
|
|
(56.5 |
) |
|
|
51.8 |
|
% Operating margin |
|
|
8.2 |
% |
|
|
6.6 |
% |
|
|
|
|
|
3.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
123.4 |
|
|
|
14.5 |
|
|
|
0.1 |
|
|
|
138.0 |
|
Stock-based compensation expense |
|
|
6.9 |
|
|
|
1.5 |
|
|
|
10.6 |
|
|
|
19.0 |
|
Accrual based additions to capital expenditures |
|
|
35.7 |
|
|
|
5.7 |
|
|
|
- |
|
|
|
41.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Year Ended December 31, 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales to external customers |
|
$ |
1,185.9 |
|
|
$ |
316.5 |
|
|
$ |
- |
|
|
$ |
1,502.4 |
|
Intersegment sales |
|
|
53.9 |
|
|
|
2.5 |
|
|
|
(56.4 |
) |
|
|
- |
|
Total sales |
|
|
1,239.8 |
|
|
|
319.0 |
|
|
|
(56.4 |
) |
|
|
1,502.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other operating expense |
|
|
32.1 |
|
|
|
9.8 |
|
|
|
16.0 |
|
|
|
57.9 |
|
Operating income (loss) |
|
|
60.7 |
|
|
|
9.4 |
|
|
|
(56.0 |
) |
|
|
14.1 |
|
% Operating margin |
|
|
4.9 |
% |
|
|
2.9 |
% |
|
|
|
|
|
0.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
125.5 |
|
|
|
15.3 |
|
|
|
0.1 |
|
|
|
140.9 |
|
Stock-based compensation expense |
|
|
7.1 |
|
|
|
1.8 |
|
|
|
6.5 |
|
|
|
15.4 |
|
Accrual based additions to capital expenditures |
|
|
38.6 |
|
|
|
3.9 |
|
|
|
- |
|
|
|
42.5 |
|
(a) Hexcel does not allocate corporate expenses to the operating segments.
10
Hexcel Corporation and Subsidiaries |
|
|||||||||||||||
Reconciliation of GAAP to Non-GAAP Operating Income (Loss), Net Income (Loss), EPS and Operating Cash Flow to Free Cash Flow |
Table C |
|
||||||||||||||
|
|
Unaudited |
|
|||||||||||||
|
|
Quarters Ended |
|
|
Years Ended |
|
||||||||||
|
|
December 31, |
|
|
December 31, |
|
||||||||||
(In millions) |
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
GAAP operating income (loss) |
|
$ |
23.0 |
|
|
$ |
(20.4 |
) |
|
$ |
51.8 |
|
|
$ |
14.1 |
|
Other operating expense (a) |
|
|
2.2 |
|
|
|
14.3 |
|
|
|
18.2 |
|
|
|
57.9 |
|
Non-GAAP operating income (loss) |
|
$ |
25.2 |
|
|
$ |
(6.1 |
) |
|
$ |
70.0 |
|
|
$ |
72.0 |
|
|
|
Unaudited |
|
|||||||||||||
|
|
Quarters Ended December 31, |
|
|||||||||||||
|
|
2021 |
|
|
2020 |
|
||||||||||
(In millions, except per diluted share data) |
|
Net Income |
|
|
EPS |
|
|
Net Loss |
|
|
EPS |
|
||||
GAAP |
|
$ |
18.9 |
|
|
$ |
0.22 |
|
|
$ |
(19.4 |
) |
|
$ |
(0.23 |
) |
Other operating expense (a) |
|
|
1.7 |
|
|
|
0.02 |
|
|
|
10.0 |
|
|
|
0.12 |
|
Other income (b) |
|
|
(6.6 |
) |
|
|
(0.08 |
) |
|
|
- |
|
|
|
- |
|
Tax benefit (c) |
|
|
(0.5 |
) |
|
|
- |
|
|
|
(5.8 |
) |
|
|
(0.07 |
) |
Non-GAAP |
|
$ |
13.5 |
|
|
$ |
0.16 |
|
|
$ |
(15.2 |
) |
|
$ |
(0.18 |
) |
|
|
Unaudited |
|
|||||||||||||
|
|
Years Ended December 31, |
|
|||||||||||||
|
|
2021 |
|
|
2020 |
|
||||||||||
(In millions, except per diluted share data) |
|
Net Income |
|
|
EPS |
|
|
Net Income |
|
|
EPS |
|
||||
GAAP |
|
$ |
16.1 |
|
|
$ |
0.19 |
|
|
$ |
31.7 |
|
|
$ |
0.38 |
|
Other operating expense (a) |
|
|
13.4 |
|
|
|
0.16 |
|
|
|
43.6 |
|
|
|
0.52 |
|
Other income (b) |
|
|
(6.6 |
) |
|
|
(0.08 |
) |
|
|
- |
|
|
|
- |
|
Tax expense (benefit) (c) |
|
|
0.3 |
|
|
|
- |
|
|
|
(54.7 |
) |
|
|
(0.65 |
) |
Non-GAAP |
|
$ |
23.2 |
|
|
$ |
0.27 |
|
|
$ |
20.6 |
|
|
$ |
0.25 |
|
|
|
Unaudited |
|
|||||
|
|
Years Ended December 31, |
|
|||||
(In millions) |
|
2021 |
|
|
2020 |
|
||
Net cash provided by operating activities |
|
$ |
151.7 |
|
|
$ |
264.3 |
|
Less: Capital expenditures |
|
|
(27.9 |
) |
|
|
(50.6 |
) |
Free cash flow (non-GAAP) |
|
$ |
123.8 |
|
|
$ |
213.7 |
|
NOTE: Management believes that adjusted operating income (loss), adjusted net income (loss), adjusted diluted net income (loss) per share, the adjusted tax rate, and free cash flow, which are non-GAAP measures, are meaningful to investors because they provide a view of Hexcel with respect to the underlying operating results excluding special items. Special items represent significant charges or credits that are important to an understanding of Hexcel’s overall operating results in the periods
11
presented. Non-GAAP measurements are not recognized in accordance with generally accepted accounting principles and should not be viewed as an alternative to GAAP measures of performance.
Hexcel Corporation and Subsidiaries |
|
|||||||||||
Schedule of Total Debt, Net of Cash |
Table D |
|
||||||||||
|
|
Unaudited |
|
|||||||||
|
|
December 31, |
|
|
December 31, |
|
|
December 31, |
|
|||
(In millions) |
|
2021 |
|
|
2020 |
|
|
2019 |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Current portion finance lease |
|
$ |
0.9 |
|
|
$ |
0.9 |
|
|
$ |
0.6 |
|
Current portion Euro term loan |
|
|
- |
|
|
|
- |
|
|
|
8.9 |
|
Total current debt |
|
|
0.9 |
|
|
|
0.9 |
|
|
|
9.5 |
|
|
|
|
|
|
|
|
|
|
|
|||
Senior unsecured credit facility |
|
|
125.0 |
|
|
|
228.0 |
|
|
|
313.0 |
|
4.7% senior notes due 2025 |
|
|
300.0 |
|
|
|
300.0 |
|
|
|
300.0 |
|
3.95% senior notes due 2027 |
|
|
400.0 |
|
|
|
400.0 |
|
|
|
400.0 |
|
Non-current portion Euro term loan |
|
|
- |
|
|
|
- |
|
|
|
41.5 |
|
Senior notes original issue discounts |
|
|
(1.2 |
) |
|
|
(1.5 |
) |
|
|
(1.7 |
) |
Senior notes deferred financing costs |
|
|
(2.9 |
) |
|
|
(3.5 |
) |
|
|
(4.2 |
) |
Other debt |
|
|
1.5 |
|
|
|
2.5 |
|
|
|
2.0 |
|
Total long-term debt |
|
|
822.4 |
|
|
|
925.5 |
|
|
|
1,050.6 |
|
Total Debt |
|
|
823.3 |
|
|
|
926.4 |
|
|
|
1,060.1 |
|
Less: Cash and cash equivalents |
|
|
(127.7 |
) |
|
|
(103.3 |
) |
|
|
(64.4 |
) |
Total debt, net of cash |
|
$ |
695.6 |
|
|
$ |
823.1 |
|
|
$ |
995.7 |
|
12