Hexcel(US:HXL) ZACKS·2025-10-23 14:51Core Insights - Hexcel Corporation (HXL) reported third-quarter 2025 adjusted earnings of 37 cents per share, a decline of 21.3% from 47 cents in the same quarter last year, and missed the Zacks Consensus Estimate of 38 cents by 2.6% [1][8] - The company's GAAP earnings were 26 cents per share, down 46.9% from 49 cents year-over-year [1] Sales Performance - HXL's net sales for the third quarter totaled $456.2 million, exceeding the Zacks Consensus Estimate of $449 million by 1.6%, but down 0.1% from $456.5 million in the prior year [3][8] - The decline in sales was primarily due to lower demand in the Commercial Aerospace market, which saw a 7.3% decrease year-over-year [3][6] Operational Metrics - The gross margin for the third quarter was 21.9%, a contraction of 140 basis points from the previous year, attributed to inventory reduction actions and an unfavorable sales mix [4] - Selling, general and administrative (SG&A) expenses increased by 3.3% year-over-year to $41.1 million, while research and technology expenses rose 1.4% to $14 million [4] Market Contributions - In the Commercial Aerospace sector, net sales decreased to $274.2 million, while the Space and Defense sector saw a 13.3% increase in net sales to $182 million [6] Financial Position - As of September 30, 2025, Hexcel's cash and cash equivalents were $90.5 million, down from $125.4 million at the end of 2024, and long-term debt increased to $757.9 million from $700.6 million [7] Future Guidance - Hexcel revised its 2025 sales guidance to approximately $1.88 billion, down from the previous range of $1.88-$1.95 billion, and adjusted earnings per share guidance to $1.70-$1.80 from $1.85-$2.05 [10] - The company expects to generate free cash flow of nearly $190 million in 2025, with capital expenditures projected to be less than $90 million [11]