Hexcel's Q4 Earnings Surpass Estimates, Revenues Improve Y/Y

Earnings Performance - Adjusted earnings per share for Q4 2024 were 52 cents, a 20.9% increase from 43 cents in the year-ago quarter [1] - GAAP earnings per share were 7 cents, compared to a loss of 21 cents in the year-ago quarter [2] - Full-year 2024 adjusted earnings per share were $2.03, up from$ 1.81 in 2023 [2] Sales Performance - Q4 2024 net sales totaled $473.8 million, beating the consensus estimate of$ 471 million by 0.6% and representing a 3.6% year-over-year increase from $457.5 million [3] - Full-year 2024 sales reached$ 1.90 billion, up from $1.79 billion in 2023 [3] Operational Metrics - Gross margin improved by 250 basis points to 25% in Q4 2024 [4] - SG&A expenses increased 14.3% year-over-year to$ 47.9 million [4] - Research and technology expenses rose 11.6% year-over-year to $13.5 million [4] Market Segment Performance - Commercial Aerospace sales grew 4% year-over-year to$ 278.3 million, contributing 58.7% of total revenues [5] - Space and Defense sales increased 7.2% year-over-year to $163.3 million, contributing 34.5% of total revenues [5] - Industrial sales declined 14.6% year-over-year to$ 32.2 million, contributing 6.8% of total revenues [6] Financial Position - Cash and cash equivalents decreased to $125.4 million as of Dec 31, 2024, from$ 227 million a year earlier [7] - Long-term debt increased slightly to $700.6 million from$ 699.4 million [7] - Operating cash flow improved to $289.9 million from$ 257.1 million [7] - Adjusted free cash flow increased to $202.9 million from$ 148.9 million [7] Future Guidance - 2025 sales guidance is projected between $1.95-$ 2.05 billion, with consensus estimate at $2 billion [8] - Adjusted earnings per share guidance for 2025 is$ 2.05- $2.25, below the consensus estimate of$ 2.34 [8] - Free cash flow is expected to exceed $220 million in 2025 [9] - Capital expenditure is projected to be less than$ 100 million in 2025 [9] Industry Updates - Teledyne Technologies reported Q4 2024 adjusted earnings of $5.52 per share, beating estimates by 5.5%, with sales of$ 1.50 billion exceeding estimates by 3.7% [11] - Textron reported Q4 2024 adjusted earnings of $1.34 per share, beating estimates by 7.2%, despite revenues of$ 3.61 billion missing estimates by 3.5% [12] - Leidos Holdings is set to report Q4 2024 earnings on Feb 11, 2025, with consensus estimates of $2.18 per share and$ 4.12 billion in sales, indicating 3.6% year-over-year growth [13]