- Q2 2021 GAAP diluted EPS of $0.03 and adjusted diluted EPS
of $0.08, compared to Q2 2020 GAAP diluted EPS of ($0.01) and
adjusted diluted EPS of $0.08.
- Q2 2021 Sales were $320 million, compared to $379 million in
Q2 2020.
- Free Cash Flow YTD of $30 million.
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.
Hexcel Corporation (NYSE: HXL):
Summary of Results from Operations
Quarters Ended
Six Months Ended
June 30,
June 30,
(In millions, except per share data)
2021
2020
% Change
2021
2020
% Change
Net Sales
$
320.3
$
378.7
(15.4
)%
$
630.6
$
919.7
(31.4
)%
Net sales change in constant currency
(16.7
)%
(32.5
)%
Operating Income
16.2
6.4
153.1
%
6.0
72.1
(91.7
)%
Net Income (Loss)
2.2
(1.0
)
N/M
(11.8
)
41.4
(128.5
)%
Diluted net income (loss) per common
share
$
0.03
$
(0.01
)
N/M
$
(0.14
)
$
0.49
(128.6
)%
Non-GAAP measures for year-over-year
comparison (Table C)
Adjusted Operating Income
$
19.3
$
19.5
(1.0
)%
$
21.2
$
99.9
(78.8
)%
As a % of sales
6.0
%
5.1
%
3.4
%
10.9
%
Adjusted Net Income (Loss)
7.1
6.4
10.9
%
(1.3
)
60.2
(102.2
)%
Adjusted diluted net income (loss) per
share
$
0.08
$
0.08
0.0
%
$
(0.02
)
$
0.72
(102.8
)%
Hexcel Corporation (NYSE: HXL) today reported second quarter
2021 results including net sales of $320 million and adjusted
diluted EPS of $0.08 per share.
Chairman, CEO and President Nick Stanage said, “I am pleased to
report a positive quarter for Hexcel as we begin to return to top
line growth. Sales in the second quarter were in line with our
expectations, and we delivered solid margin performance supported
by favorable mix from higher fiber sales, which combined with
planned reductions in our overhead cost base, resulted in 8 cents
of adjusted EPS for the quarter. Looking forward, we expect the
majority of commercial aerospace supply chain destocking to be
largely behind us with a small amount remaining in the second half
of the year.”
Mr. Stanage continued, “We are encouraged that airlines are
placing new orders with the commercial aerospace OEMs, leading once
again to a growing aircraft backlog as passenger numbers continue
to increase steadily around the world. Our team is prepared and
focused on ramping up production levels to meet growing customer
demand, particularly as aircraft operators seek more aerodynamic,
lightweight aircraft that improve fuel efficiency and reduce
emissions. I am excited about the path ahead with significant
Hexcel sales growth expected in 2022, 2023 and beyond as we drive
strong incremental profits, generate robust positive cash flow and
deliver increasing shareholder returns.”
Markets
Sales in the second quarter of 2021 were $320.3 million compared
to $378.7 million in the second quarter of 2020.
Commercial Aerospace
- Commercial Aerospace sales of $153.7 million decreased 24.6%
(24.8% in constant currency) for the quarter compared to the second
quarter of 2020. Narrowbody demand is recovering with sales in the
second quarter of 2021 reaching their highest level since the first
quarter of 2020 when the pandemic was just beginning.
- Sales to “Other Commercial Aerospace,” which include regional
and business aircraft, fell by 26.6% for the second quarter of 2021
compared to the second quarter of 2020. Business jets is the
largest market within Other Commercial Aerospace and sales
continued to recover sequentially in the second quarter of 2021
however remained below prior year levels.
Space & Defense
- Space & Defense sales of $106.9 million decreased 1.4%
(2.7% in constant currency) for the quarter as compared to 2020.
This nominal decrease reflected temporary pandemic-induced
disruptions within select space and defense platforms globally,
while overall the space and defense outlook remains robust.
Industrial
- Total Industrial sales of $59.7 million in the second quarter
were down 10.1% (15.1% in constant currency) compared to the second
quarter of 2020. Solid sales in other industrial markets including
automotive and recreation helped offset some of the reduced wind
energy sales.
- Wind energy sales (the largest submarket in Industrial),
experienced a decline of 43.9% in constant currency compared to the
second quarter of 2020 reflecting the continued lower demand and
cessation of sales in North America.
Consolidated Operations
Gross margin for the second quarter was 19.3% compared to 14.5%
in the prior year period reflecting a step up in carbon fiber
production and sales resulting in a strong margin mix as well as
the lower operating overhead cost base. Selling, general and
administrative and R&T expenses for the second quarter of 2021
were 20% higher than the prior year, however 21% lower than Q2
2019. Other operating expenses included restructuring costs.
Adjusted operating income in the second quarter of 2021 was $19.3
million, or 6.0% of sales, compared to $19.5 million, or 5.1% of
sales in 2020. The impact of exchange rates on operating income as
a percent of sales was favorable by approximately seventy basis
points in the second quarter of 2021 compared to 2020.
Year-to-Date 2021
Results
Sales of $630.6 million for the first six months of 2021
decreased 31.4% (32.5% in constant currency) compared to the same
period in 2020.
Commercial Aerospace (48% of YTD sales)
- Commercial Aerospace sales of $301.3 million decreased 46.8%
(47.2% in constant currency) compared to the first six months of
2020. Destocking in the commercial aerospace supply chain impacting
Hexcel is now largely completed with only a small amount related to
widebody aircraft forecasted for the 2nd half of 2021.
- Sales to “Other Commercial Aerospace,” which include regional
and business aircraft customers, decreased 39.2% year to date.
Space & Defense (35% of YTD sales)
- Space & Defense sales of $218.6 million decreased 0.6%
(1.8% in constant currency) compared to the first six months of
2020.
Industrial (17% of YTD sales)
- Total Industrial sales of $110.7 million decreased 16.7% (21.1%
in constant currency) compared to the first six months of
2020.
- For the first six months of 2021, wind energy sales decreased
43.2% in constant currency compared to last year due to the
cessation of sales in North America.
Consolidated Operations
Gross margin for the first six months of 2021 was 18.2% compared
to 21.3% in the prior year period. Selling, general and
administrative and R&T expenses for the first six months of
2021 were relatively flat compared to the prior year. Other
operating expenses for the first six months of 2021 were $15.2
million compared to $27.8 million in 2020 as the prior year
included expenses related to the terminated merger with Woodward,
Inc. Adjusted operating income for the first six months of 2021 was
$21.2 million, or 3.4% of sales, compared to $99.9 million, or
10.9% of sales in 2020. The impact of exchange rates on operating
income as a percent of sales for the first six months of 2021 was
favorable by approximately twenty five basis points compared to
2020.
Cash, 2021 Guidance Update and
other
- The effective tax rate for the second quarter of 2021 was 58.0%
and included a discrete tax charge of $2.7 million related to the
remeasurement of the net deferred tax liability in one of the
foreign jurisdictions as a result of an unfavorable tax rate
change. Excluding the discrete item, the effective tax rate for the
second quarter was 18.8%. The effective tax rate year-to-date was
25.7% and included a discrete tax benefit of $3.2 million from the
revaluation of deferred tax liabilities related to a favorable U.S.
state tax law change in addition to the $2.7 million discrete tax
charge previously mentioned. The effective tax rate was 16.5% for
the first six months of 2020 and included a $2.7 million benefit,
primarily for the release of reserves of unrecognized tax benefits,
as a result of tax audit settlements in the second quarter of 2020.
The underlying effective tax rate for the remainder of 2021
continues to be 23%.
- Net cash generated from operating activities for the first six
months of 2021 was $38.9 million, compared to $73.6 million for the
first six months of 2020. Capital expenditures on a cash basis were
$9.2 million for the first six months of 2021 compared to $40.4
million for the first six months of 2020. Free cash flow was $29.7
million for the first six months of 2021 compared to $33.2 million
for the first six months of 2020. Working capital was a cash use of
$19.6 million for the first six months of 2021 compared to a use of
$52.0 million for the first six months of 2020. Free cash flow is
defined as cash generated from operating activities less cash paid
for capital expenditures. Liquidity remained strong with cash of
$115 million and revolver borrowing availability of $543 million at
June 30, 2021.
- Share repurchases are restricted per the second amendment to
the Revolver facility that was executed in January 2021. The
remaining authorization under the share repurchase program at June
30, 2021 was $217 million. The quarterly dividend remains
temporarily suspended. The Board of Directors will continue to
evaluate capital allocation strategies on at least a quarterly
basis.
- The Company continues to withhold financial guidance due to
continuing market uncertainties arising from the global
pandemic.
Hexcel will host a conference call at 10:00 a.m. ET, on July 27,
2021 to discuss second quarter 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 (647) 689-5685. The
conference ID is 8696963. Replays of the call will be available on
the website.
Hexcel Corporation is a leading advanced composites company. It
develops, manufactures and markets lightweight, high-performance
structural materials, including carbon fibers, specialty
reinforcements, prepregs and other fiber-reinforced matrix
materials, honeycomb, adhesives, engineered core and composite
structures, used in commercial aerospace, space and defense and
industrial applications. Learn more at www.Hexcel.com.
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 possible 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 the build rate of
the Boeing 737 MAX following its return to service and the related
impact on our revenues; expectations with regard to the timing of
inventory destocking resulting from the pandemic-related decrease
in customer demand; 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 maintain and improve margins in view of the pandemic-induced
economic environment; 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 2021 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, ongoing restrictions on movement and travel,
employee absenteeism 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 reduction in
revenue related to the timing of ramp-up of production of the
Boeing 737 MAX, 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; inability to
successfully implement or realize our business strategies, plans
and objectives of management, including any restructuring or
alignment activities in which we may engage; timing of inventory
destocking caused by the COVID-19 pandemic; changes in sales mix;
changes in current pricing and cost levels; 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; supply chain
disruptions; inability to install, staff and qualify necessary
capacity or complete capacity expansions to meet customer demand;
cybersecurity 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 and the impact of the exit of the U.K. from the European
Union; work stoppages or other labor disruptions; 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.
Hexcel Corporation and
Subsidiaries
Condensed Consolidated Statements of
Operations
Unaudited
Quarters Ended
Six Months Ended
June 30,
June 30,
(In millions, except per share data)
2021
2020
2021
2020
Net sales
$
320.3
$
378.7
$
630.6
$
919.7
Cost of sales
258.4
323.8
515.6
723.9
Gross margin
61.9
54.9
115.0
195.8
% Gross Margin
19.3
%
14.5
%
18.2
%
21.3
%
Selling, general and administrative
expenses
31.1
24.1
70.7
70.6
Research and technology expenses
11.5
11.3
23.1
25.3
Other operating expense
3.1
13.1
15.2
27.8
Operating income
16.2
6.4
6.0
72.1
Interest expense, net
9.3
10.7
19.6
22.7
Income (loss) before income taxes, and
equity in earnings of affiliated companies
6.9
(4.3
)
(13.6
)
49.4
Income tax expense (benefit)
4.0
(3.6
)
(3.5
)
8.2
Income (loss) before equity in earnings of
affiliated companies
2.9
(0.7
)
(10.1
)
41.2
Equity in (losses) earnings from
affiliated companies
(0.7
)
(0.3
)
(1.7
)
0.2
Net income (loss)
$
2.2
$
(1.0
)
$
(11.8
)
$
41.4
Basic net income (loss) per common
share:
$
0.03
$
(0.01
)
$
(0.14
)
$
0.49
Diluted net income (loss) per common
share:
$
0.03
$
(0.01
)
$
(0.14
)
$
0.49
Weighted-average common shares:
Basic
84.1
83.7
84.0
83.7
Diluted
84.7
83.7
84.0
84.1
Hexcel Corporation and
Subsidiaries
Condensed Consolidated Balance
Sheets
Unaudited
June 30,
December 31,
(In millions)
2021
2020
Assets
Cash and cash equivalents
$
115.3
$
103.3
Accounts receivable, net
168.7
125.4
Inventories, net
232.4
213.5
Contract assets
40.5
43.1
Prepaid expenses and other current
assets
49.8
38.0
Assets held for sale
12.6
12.6
Total current assets
619.3
535.9
Property, plant and equipment
3,122.3
3,139.7
Less accumulated depreciation
(1,321.3
)
(1,265.5
)
Net property, plant and equipment
1,801.0
1,874.2
Goodwill and other intangible assets,
net
273.2
277.8
Investments in affiliated companies
43.4
44.7
Other assets
180.5
185.2
Total assets
$
2,917.4
$
2,917.8
Liabilities and Stockholders'
Equity
Liabilities:
Short-term borrowings
$
0.9
$
0.9
Accounts payable
86.8
70.0
Accrued compensation and benefits
65.1
43.2
Accrued liabilities
82.8
69.0
Total current liabilities
235.6
183.1
Long-term debt
904.5
925.5
Retirement obligations
52.4
53.9
Other non-current liabilities
222.1
245.1
Total liabilities
$
1,414.6
$
1,407.6
Stockholders' equity:
Common stock, $0.01 par value, 200.0
shares authorized,
110.0 shares issued at June 30, 2021 and
109.7 shares
issued at December 31, 2020
$
1.1
$
1.1
Additional paid-in capital
869.7
849.7
Retained earnings
1,984.6
1,996.4
Accumulated other comprehensive loss
(73.2
)
(59.6
)
2,782.2
2,787.6
Less – Treasury stock, at cost, 26.1
shares at both June 30, 2021 and December 31, 2020
(1,279.4
)
(1,277.4
)
Total stockholders' equity
1,502.8
1,510.2
Total liabilities and stockholders'
equity
$
2,917.4
$
2,917.8
Hexcel Corporation and
Subsidiaries
Condensed Consolidated Statements of
Cash Flows
Unaudited
Six Months Ended
June 30,
(In millions)
2021
2020
Cash flows from operating
activities
Net (loss) income
$
(11.8
)
$
41.4
Reconciliation to net cash provided by
operating activities:
Depreciation and amortization
68.7
70.4
Amortization related to financing
2.1
0.5
Deferred income taxes
(10.7
)
(0.1
)
Equity in earnings from affiliated
companies
1.7
(0.2
)
Stock-based compensation
13.3
12.7
Merger and restructuring expenses, net of
payments
(2.5
)
7.6
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable
(45.9
)
34.3
(Increase) decrease in inventories
(21.8
)
14.6
Increase in prepaid expenses and other
current assets
(2.6
)
(5.7
)
Increase (decrease) in accounts
payable/accrued liabilities
50.7
(95.2
)
Other - net
(2.3
)
(6.7
)
Net cash provided by operating activities
(a)
38.9
73.6
Cash flows from investing
activities
Capital expenditures (b)
(9.2
)
(40.4
)
Net cash used for investing activities
(9.2
)
(40.4
)
Cash flows from financing
activities
Net (repayments) borrowing from senior
unsecured credit facilities
(21.0
)
255.0
Repayments of Euro term loan
-
(49.9
)
Repayment of finance lease obligation and
other debt, net
(0.4
)
(0.2
)
Dividends paid
-
(14.2
)
Repurchase of stock
-
(24.6
)
Activity under stock plans
4.8
(5.2
)
Net cash (used for) provided by financing
activities
(16.6
)
160.9
Effect of exchange rate changes on cash
and cash equivalents
(1.1
)
(1.3
)
Net increase in cash and cash
equivalents
12.0
192.8
Cash and cash equivalents at beginning of
period
103.3
64.4
Cash and cash equivalents at end of
period
$
115.3
$
257.2
Supplemental data:
Free Cash Flow (a)+(b)
$
29.7
$
33.2
Accrual basis additions to property, plant
and equipment
$
7.8
$
33.4
Hexcel Corporation and
Subsidiaries
Net Sales to Third-Party Customers by
Market
Quarters Ended June 30, 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
$
153.7
$
203.9
(24.6
)
$
0.6
$
204.5
(24.8
)
Space & Defense
106.9
108.4
(1.4
)
1.5
109.9
(2.7
)
Industrial
59.7
66.4
(10.1
)
3.9
70.3
(15.1
)
Consolidated Total
$
320.3
$
378.7
(15.4
)
$
6.0
$
384.7
(16.7
)
Consolidated % of Net Sales
%
%
%
Commercial Aerospace
48.0
53.9
53.2
Space & Defense
33.4
28.6
28.5
Industrial
18.6
17.5
18.3
Consolidated Total
100.0
100.0
100.0
Six Months Ended June 30, 2021 and
2020
Unaudited
(In millions)
As Reported
Constant Currency (a)
B/(W)
FX
B/(W)
Market
2021
2020
%
Effect (b)
2020
%
Commercial Aerospace
$
301.3
$
566.8
(46.8
)
$
4.1
$
570.9
(47.2
)
Space & Defense
218.6
220.0
(0.6
)
2.7
222.7
(1.8
)
Industrial
110.7
132.9
(16.7
)
7.4
140.3
(21.1
)
Consolidated Total
$
630.6
$
919.7
(31.4
)
$
14.2
$
933.9
(32.5
)
Consolidated % of Net Sales
%
%
%
Commercial Aerospace
47.8
61.6
61.1
Space & Defense
34.7
23.9
23.9
Industrial
17.5
14.5
15.0
Consolidated Total
100.0
100.0
100.0
(a)
To assist in the analysis of the Company’s net sales trend,
total net sales and sales by market for the quarter and six months
ended June 30, 2020 have been estimated using the same U.S. dollar,
British pound and Euro exchange rates as applied for the respective
period in 2021 and are referred to as “constant currency”
sales.
(b)
FX effect is the estimated impact on “as reported” net sales due
to changes in foreign currency exchange rates.
Hexcel Corporation and
Subsidiaries
Segment Information
Unaudited
Table B
(In millions)
Composite Materials
Engineered Products
Corporate & Other
(a)
Total
Second Quarter 2021
Net sales to external customers
$
240.9
$
79.4
$
-
$
320.3
Intersegment sales
14.6
0.8
(15.4
)
-
Total sales
255.5
80.2
(15.4
)
320.3
Other operating expense
2.8
0.2
0.1
3.1
Operating income (loss)
24.5
5.9
(14.2
)
16.2
% Operating margin
9.6
%
7.4
%
5.1
%
Depreciation and amortization
30.5
3.6
0.1
34.2
Stock-based compensation expense
0.8
0.1
3.4
4.3
Accrual based additions to capital
expenditures
3.4
0.4
-
3.8
Second Quarter 2020
Net sales to external customers
$
306.2
$
72.5
$
-
$
378.7
Intersegment sales
15.4
0.4
(15.8
)
-
Total sales
321.6
72.9
(15.8
)
378.7
Other operating expense
8.5
2.4
2.2
13.1
Operating income (loss)
20.1
(0.5
)
(13.2
)
6.4
% Operating margin
6.3
%
(0.7
)%
1.7
%
Depreciation and amortization
30.8
4.0
0.1
34.9
Stock-based compensation expense
(0.3
)
(0.1
)
(1.3
)
(1.7
)
Accrual based additions to capital
expenditures
10.5
1.0
-
11.5
First Six Months 2021
Net sales to external customers
$
478.1
$
152.5
$
-
$
630.6
Intersegment sales
27.8
1.4
(29.2
)
-
Total sales
505.9
153.9
(29.2
)
630.6
Other operating expense
15.5
(0.5
)
0.2
15.2
Operating income (loss)
31.9
10.6
(36.5
)
6.0
% Operating margin
6.3
%
6.9
%
1.0
%
Depreciation and amortization
61.3
7.3
0.1
68.7
Stock-based compensation expense
1.4
0.3
11.6
13.3
Accrual based additions to capital
expenditures
7.0
0.8
-
7.8
First Six Months 2020
Net sales to external customers
$
744.7
$
175.0
$
-
$
919.7
Intersegment sales
40.2
0.9
(41.1
)
-
Total sales
784.9
175.9
(41.1
)
919.7
Other operating expense
9.1
2.7
16.0
27.8
Operating income (loss)
111.6
6.0
(45.5
)
72.1
% Operating margin
14.2
%
3.4
%
7.8
%
Depreciation and amortization
62.6
7.7
0.1
70.4
Stock-based compensation expense
4.4
1.1
7.2
12.7
Accrual based additions to capital
expenditures
30.7
2.7
-
33.4
(a)
Hexcel does not allocate corporate
expenses to the operating segments.
Hexcel Corporation and
Subsidiaries
Reconciliation of GAAP to Non-GAAP
Operating Income, Net Income (Loss), EPS and Operating Cash Flow to
Free Cash Flow
Table C
Unaudited
Quarters Ended
Six Months Ended
June 30,
June 30,
(In millions)
2021
2020
2021
2020
GAAP operating income
$
16.2
$
6.4
$
6.0
$
72.1
Other operating expense (a)
3.1
13.1
15.2
27.8
Non-GAAP operating income
$
19.3
$
19.5
$
21.2
$
99.9
Unaudited
Quarters Ended June 30,
2021
2020
(In millions, except per diluted share
data)
Net Income
EPS
Net (Loss) Income
EPS
GAAP
$
2.2
$
0.03
$
(1.0
)
$
(0.01
)
Other operating expense (a)
2.2
0.02
10.1
0.12
Tax expense (benefit) (b)
2.7
0.03
(2.7
)
(0.03
)
Non-GAAP
$
7.1
$
0.08
$
6.4
$
0.08
Unaudited
Six Months Ended June 30,
2021
2020
(In millions, except per diluted share
data)
Net Loss
EPS
Net Income
EPS
GAAP
$
(11.8
)
$
(0.14
)
$
41.4
$
0.49
Other operating expense (a)
11.0
0.13
21.5
0.26
Tax benefit (b)
(0.5
)
(0.01
)
(2.7
)
(0.03
)
Non-GAAP
$
(1.3
)
$
(0.02
)
$
60.2
$
0.72
Unaudited
Six Months Ended June 30,
(In millions)
2021
2020
Net cash provided by operating
activities
$
38.9
$
73.6
Less: Capital expenditures
(9.2
)
(40.4
)
Free cash flow (non-GAAP)
$
29.7
$
33.2
(a)
The quarter and six months ended June 30,
2021 included restructuring costs primarily related to severance as
well as a benefit related to the reduction of a contingent
liability. The quarter and six months ended June 30, 2020 included
restructuring costs as well as costs related to the terminated
merger with Woodward, Inc.
(b)
The quarter ended June 30, 2021 included a
discrete tax charge of $2.7 million related to the remeasurement of
the net deferred tax liability in a foreign jurisdiction as a
result of a change in tax rate. The six months ended June 30, 2021
included a discrete tax benefit of $3.2 million from the
revaluation of deferred tax liabilities related to a favorable U.S.
state tax law change in addition to the $2.7 million discrete tax
charge previously mentioned. The quarter and six months ended June
30, 2020 included a tax benefit primarily due to the release of
reserves of unrecognized tax benefits as a result of tax audit
settlements.
NOTE: Management believes that adjusted operating
income, 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
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
June 30,
December 31,
June 30,
(In millions)
2021
2020
2020
Current portion finance lease
$
0.9
$
0.9
$
0.5
Total current debt
0.9
0.9
0.5
Senior unsecured credit facility
207.0
228.0
568.0
4.7% senior notes due 2025
300.0
300.0
300.0
3.95% senior notes due 2027
400.0
400.0
400.0
Senior notes original issue discounts
(1.3
)
(1.5
)
(1.6
)
Senior notes deferred financing costs
(3.2
)
(3.5
)
(3.8
)
Other debt
2.0
2.5
2.1
Total long-term debt
904.5
925.5
1,264.7
Total Debt
905.4
926.4
1,265.2
Less: Cash and cash equivalents
(115.3
)
(103.3
)
(257.2
)
Total debt, net of cash
$
790.1
$
823.1
$
1,008.0
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210726005711/en/
Kurt Goddard, Vice President – Investor Relations (203) 352-6826
Kurt.Goddard@Hexcel.com
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