Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $194.1 million, a 1.7% increase from $190.8 million in Q1 2024, marking the sixteenth consecutive quarter of year-over-year revenue growth [8][22] - Gross margin increased to 26.6%, up from 24.6% year-over-year, achieving a new quarterly record [12][23] - Adjusted EBITDA reached 15.9% of sales, a record high, reflecting strong operational performance [13][37] - GAAP diluted EPS was $0.69, compared to $0.46 in Q1 2024, while adjusted diluted EPS was $0.83, up from $0.70 [14][28] Business Line Data and Key Metrics Changes - Military and space revenue grew by 15% year-over-year, driven by missile and electronic warfare programs [9][19] - Commercial aerospace revenue declined by 10% to $72 million, marking the first decline in 15 quarters, primarily due to lower demand for the 737 MAX [10][20] - Industrial business revenue decreased to $9 million as the company pruned non-core operations [21] Market Data and Key Metrics Changes - The defense backlog increased by $15 million year-over-year to $620 million, while the commercial aerospace backlog decreased by $31 million to $411 million [14][20] - The company reported that 95% of its revenue is generated in the U.S., with minimal exposure to tariffs due to its manufacturing footprint [17][26] Company Strategy and Development Direction - The Vision 2027 strategy aims to increase the revenue percentage from engineered products to over 25%, with current contributions at 23% [8][15] - The company is focused on consolidating its manufacturing footprint and pursuing targeted acquisitions to enhance growth [8][34] - Continued emphasis on value-added pricing and expanding content on key commercial aerospace platforms is part of the strategic plan [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery in commercial aerospace in the second half of 2025, despite current headwinds [16][100] - The company anticipates mid-single-digit revenue growth for 2025, supported by strong defense activity and recovery in commercial aerospace [16][101] - Management highlighted the importance of maintaining a balanced portfolio between defense and commercial sectors to mitigate risks [68] Other Important Information - The company is undergoing a restructuring initiative aimed at improving operational efficiency and reducing costs, with expected annual savings of $11 million to $13 million [33][34] - Cash flow from operating activities improved to $800,000 in Q1 2025, compared to a cash outflow of $1.6 million in Q1 2024 [35] Q&A Session Summary Question: How would you characterize any delay in ship set rates to Boeing and Spirit? - Management noted that rates from Boeing are in the low twenties and Spirit is ramping up to the mid to high twenties, with optimism for continued growth despite destocking impacts [40][41] Question: What is the outlook for the M&A pipeline? - Management confirmed ongoing diligence on multiple opportunities and expressed confidence in completing a deal this year, focusing on niche engineered product businesses [52][54] Question: How do you see growth rates between commercial aerospace and defense for the remainder of the year? - Management expects continued strength in defense and a recovery in commercial aerospace, aiming for mid-single-digit growth for the full year [67][101] Question: What are the potential new work scopes in commercial and defense? - Management highlighted opportunities with Spirit AeroSystems and ongoing bidding for new work with major defense customers like RTX [80][83]

Financial Data and Key Metrics Changes - The company reported a strong Q2 with an EBITDA margin of 54% driven by growth in the commercial aftermarket and a focus on operational strategy [15][22] - The cash balance at the end of the quarter was over $2.4 billion, with expectations for significant cash generation throughout the remainder of 2025 [15][18] - The midpoint of fiscal 2025 revenue guidance is $8.85 billion, reflecting an approximate 11% increase [21] Business Line Data and Key Metrics Changes - Commercial OEM revenues were flat year-over-year but showed a 17% sequential growth compared to Q1 [26] - Commercial aftermarket revenue increased by approximately 13% compared to the prior year, with all submarkets experiencing positive growth [28] - Defense market revenue grew by approximately 9% compared to the prior year, with growth evenly distributed across OEM and aftermarket components [36] Market Data and Key Metrics Changes - Global revenue passenger miles surpassed pre-pandemic levels, with March showing a 3.3% increase year-over-year [32] - Domestic air travel was up about 1% compared to 2024 and 8% compared to 2019, while international travel increased by 4.9% compared to 2024 [35] - The company expects traffic to reach 113% of 2019 levels in 2025 according to IATA forecasts [32] Company Strategy and Development Direction - The company focuses on proprietary aerospace businesses with significant aftermarket content, utilizing a decentralized structure and disciplined capital allocation [10][12] - M&A activities remain a priority, with a disciplined approach to acquisitions that fit the company's model [16][17] - The company aims to provide private equity-like returns with the liquidity of a public market [12] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the commercial OEM market recovery despite ongoing supply chain challenges [27] - The guidance for fiscal 2025 assumes no significant macroeconomic impacts or other factors that could affect business [20] - Management acknowledges the dynamic environment but believes they are well-positioned for the remainder of fiscal 2025 [24] Other Important Information - The company has a strong liquidity position with a net debt to EBITDA ratio of 5.1, down from 5.3 [41] - The company is comfortable operating within a 5 to 7 times net debt to EBITDA ratio range [41] - The company has been actively repurchasing shares, totaling $500 million year-to-date [43] Q&A Session Summary Question: Comments on the Jefferson acquisition situation - Management expressed interest in the Jefferson business but emphasized a disciplined approach to acquisitions, ensuring they do not overvalue targets [50][51] Question: Capital deployment and share repurchases - Management confirmed that returning capital to shareholders through share repurchases or special dividends is part of their capital allocation strategy [55][56] Question: Margin expectations for the second half of the year - Management indicated that conservatism is built into the guidance, with potential margin pressures considered [60][72] Question: Performance of aftermarket submarkets - All four aftermarket submarkets performed well, with no signs of weakness observed [65][74] Question: M&A environment and valuation concerns - Management noted that while they are seeing aggressive multiples for acquisitions, they remain disciplined in their approach [99][114]

Group 1 - The conference call is focused on the First Quarter Earnings for 2025, with an emphasis on non-GAAP financial information to assist investors in reconciling financial data [3] - The financial results are presented in U.S. dollars, which is the company's functional currency [4] - The call may include forward-looking statements based on the company's expectations and market trends, which are subject to uncertainties [4][5] Group 2 - The company encourages reviewing detailed financial information published with the Brazilian Comissão de Valores Mobiliários (CVM) [5]

Financial Data and Key Metrics Changes - The company reported a strong Q2 with an EBITDA margin of 54% driven by growth in the commercial aftermarket and defense markets [14][22] - The midpoint of fiscal '25 revenue guidance is $8,850 million, reflecting an approximate 11% increase [21] - The midpoint of fiscal '25 EBITDA guidance is $4,685 million, indicating a 12% increase with an expected margin of around 52.9% [22][23] - Free cash flow for Q2 was approximately $340 million, lower than usual due to timing of interest and tax payments, with full year guidance unchanged at $2,300 million [38][39] Business Line Data and Key Metrics Changes - Commercial OEM revenues were flat year-over-year but grew by about 17% sequentially [26] - Commercial aftermarket revenue increased by approximately 13% compared to the prior year, with all submarkets experiencing positive growth [28] - Defense market revenue grew by approximately 9% compared to the prior year, with growth evenly distributed across OEM and aftermarket components [35] Market Data and Key Metrics Changes - Global revenue passenger kilometers (RPKs) were up 3.3% year-over-year, with IATA expecting traffic to reach 113% of 2019 levels in 2025 [32] - Domestic air traffic was up about 1% compared to 2024 and 8% compared to 2019, while international travel was up 4.9% compared to 2024 [34] Company Strategy and Development Direction - The company focuses on proprietary aerospace businesses with significant aftermarket content, aiming for private equity-like returns with public market liquidity [11][12] - Capital allocation priorities include reinvesting in businesses, pursuing accretive M&A, and returning capital to shareholders through share repurchases or dividends [16][17] - The company remains disciplined in its M&A approach, actively seeking opportunities that fit its model while maintaining a strong pipeline [15][100] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for the remainder of fiscal '25, despite a dynamic macroeconomic environment [24][20] - The company does not anticipate significant headwinds from tariffs and is largely insulated due to its domestic manufacturing focus [20][43] - Management remains cautious about potential economic downturns but sees no current weakness in the commercial aftermarket order book [102] Other Important Information - The CEO announced retirement at the end of fiscal '25, with the Co-COO set to take over [4][6] - The company ended the quarter with a strong cash balance of over $2,400 million, providing significant liquidity for future opportunities [14][40] Q&A Session Summary Question: Comment on the acquisition interest in Jefferson from Boeing - The company was serious about the Jefferson business due to its high aftermarket content but maintained a disciplined approach to avoid overvaluation [48][49] Question: Will the company need to pass on tariff costs to customers? - The company does not expect significant impacts from tariffs and is focused on internal cost-saving measures [50] Question: Will share repurchases or special dividends become regular capital allocation? - The company views returning capital to shareholders as a priority and will consider special dividends or repurchases when appropriate [54] Question: Discuss the margin outlook for the second half of the year - Management acknowledged conservatism in guidance, with expectations for a potential margin step down due to mix shifts and other factors [59][72] Question: Are there any specific areas of strong bookings in defense? - The company noted uniform growth across all defense businesses, with no specific area dominating [67] Question: Any unusual pre-buy activity from airlines? - The company did not observe any significant pre-buy activity related to tariffs [80] Question: How is the M&A environment affected by market volatility? - The company remains active in evaluating targets but maintains a disciplined approach to acquisitions despite aggressive market multiples [100][115]

Core Viewpoint - The partnership between Hexcel and JetZero aims to revolutionize the production of composite materials for JetZero's all-wing design aircraft, enhancing fuel efficiency and reducing carbon emissions in the aviation industry [1][2]. Group 1: Partnership and Collaboration - Hexcel and JetZero are accelerating their strategic partnership under the FAA's Aviation Sustainable Transformation (FAST) program to develop certified composite materials for JetZero's aircraft [1]. - The collaboration focuses on breakthroughs in manufacturing non-cylindrical pressure vessels, which is expected to lead to revolutionary advancements in aviation composite production [1]. Group 2: Aircraft Design and Efficiency - JetZero is developing the world's first commercial all-wing design aircraft, the Z4 model, which features a wider and shorter fuselage with four rows of passenger cabins, each equipped with independent aisles and dedicated overhead luggage compartments [1]. - Compared to traditional tube-wing aircraft of the same size, the Z4 design offers a 50% improvement in fuel efficiency due to greater lift and reduced drag [1]. Group 3: Environmental Impact and Future Plans - The aircraft is projected to enter commercial service by 2030, aiming to provide a clear pathway for the aviation industry to introduce mid-range passenger aircraft capable of carrying over 250 people with a range of 5,000 nautical miles while significantly lowering carbon emissions [1][2]. - NASA estimates that if 30% of the global mid-range fleet adopts this technology, it could reduce aviation carbon emissions by approximately 15 million tons annually, marking a significant step towards net-zero aviation [2].

Core Viewpoint - FTAI Aviation Ltd. is set to present its 2025 Adjusted Free Cash Flow outlook at the Barclays Americas Select Franchise Conference, highlighting key financial metrics and strategic initiatives [1][5]. Financial Performance - The company projects an Adjusted Free Cash Flow of $650 million for 2025, with $350 million expected in the first half and $300 million in the second half [2]. - Adjusted EBITDA is estimated at $1.1 billion for 2025, with $500 million in the first half and $600 million in the second half [2]. - The company anticipates proceeds from aviation leasing asset sales to total $145 million for the year, with $75 million in the first half and $70 million in the second half [2]. Strategic Initiatives - FTAI is completing the sale of its Seed Portfolio to SCI by Q2 2025, which is expected to enhance its cash flow [2]. - The company plans to recycle $300 million of proceeds into attractive leasing assets, aligning with its Strategic Capital Initiative [2][5]. - FTAI is focusing on an asset-light business model, which is expected to improve operational efficiency and cash generation [5]. Operational Insights - The company is targeting an average production of 100 modules per quarter at its Montréal facility in fiscal year 2025 [2]. - FTAI expects to engage in 25 to 35 V2500 engine MRE transactions during the fiscal year [2]. Company Overview - FTAI Aviation Ltd. specializes in owning and maintaining commercial jet engines, particularly CFM56 and V2500 engines, and provides cost savings and flexibility to its customers [3]. - The company also invests in aviation assets and aerospace products that generate strong and stable cash flows, with potential for earnings growth and asset appreciation [3].

Core Viewpoint - Spirit AeroSystems reported a decline in revenue and operating loss in the first quarter of 2025, primarily due to reduced production activity on Boeing programs, particularly the Boeing 737, although there was an increase in Airbus program activity [2][4][10]. Financial Performance - Revenue for the first quarter of 2025 was $1.522 billion, down 11% from $1.703 billion in the same period of 2024 [24]. - The operating loss improved to $487 million from $528 million year-over-year, with an operating loss margin of 32.0% compared to 31.0% in 2024 [24]. - Net loss was $613 million, slightly improved from $617 million in the previous year, resulting in a net loss per share of $(5.21) compared to $(5.31) [10][24]. Cash Flow and Liquidity - Cash used in operations was $420 million, a slight increase from $416 million in the prior year, while free cash flow usage was $474 million compared to $444 million [25][30]. - The cash balance at the end of the first quarter of 2025 was $220 million, down from $537 million at the end of 2024 [25][31]. Segment Performance - Commercial segment revenue decreased by 14.3% to $1.162 billion, primarily due to lower production activity on Boeing programs [26]. - Defense & Space segment revenue increased by 4.1% to $261 million, driven by higher activity on the Boeing P-8 and Sikorsky CH-53K programs [26]. - Aftermarket segment revenue increased slightly to $99.2 million, although operating margin decreased due to sales mix [26][17]. Backlog and Deliveries - Spirit's backlog at the end of the first quarter of 2025 was approximately $48 billion, encompassing work packages on all commercial platforms for Airbus and Boeing [3]. - Total deliveries increased to 429 shipsets in the first quarter of 2025, up from 307 in the same period of 2024, with significant increases in Boeing 737 deliveries [26]. Strategic Developments - The company is in the process of a merger with Boeing, expected to close in the third quarter of 2025, subject to regulatory approvals and other conditions [13]. - Spirit has also entered into a definitive agreement with Airbus for the divestiture of certain assets for $439 million, expected to close concurrently with the Boeing acquisition [14].

Financial Data and Key Metrics Changes - Q1 2025 revenue reached a record high, increasing by 6% year over year, with an EBITDA margin of 28.8% and an operating margin of 25.3%, up 500 basis points year over year [5][12][14] - Free cash flow was positive at $134 million, marking a record for the first quarter, with a 25% increase in dividends and $125 million in share buybacks [6][14][16] - Earnings per share (EPS) was $0.86, reflecting a 51% increase year over year [12][14] Business Line Data and Key Metrics Changes - **Engines Segment**: Revenue increased by 13% year over year to $996 million, with EBITDA up 31% to $325 million and an EBITDA margin of 32.6% [17] - **Fastening Systems**: Revenue grew by 6% year over year to $412 million, with EBITDA increasing by 38% to $127 million and an EBITDA margin of 30.8% [18][19] - **Engineered Structures**: Revenue rose by 8% year over year to $282 million, with EBITDA up 62% to $60 million and an EBITDA margin of 21.3% [20] - **Forged Wheels**: Revenue decreased by 13% year over year but increased by 4% sequentially, with an EBITDA margin of 27% [21] Market Data and Key Metrics Changes - **Commercial Aerospace**: Revenue increased by 9% year over year, driven by demand for engine spares and a record backlog for new aircraft [10] - **Defense Aerospace**: Grew by 19% year over year, supported by demand for engine spares and new builds [10] - **Commercial Transportation**: Revenue declined by 14% year over year, although it showed a 2% sequential increase [10] - **Industrial and Other Markets**: Revenue increased by 10%, with oil and gas up 21% and IGT up 12% [11] Company Strategy and Development Direction - The company is focused on continued investments for growth, particularly in engine markets and capacity expansions in major regions [9][28] - There is a commitment to managing energy consumption and environmental impacts, with a target of reducing greenhouse gas emissions [22] - The company aims to strengthen its balance sheet and maintain a fortress-like financial position amid market uncertainties [40][84] Management's Comments on Operating Environment and Future Outlook - Management noted that while air traffic growth is slower, there is resilience in customer demand due to underbuilding of aircraft in recent years [24][26] - The outlook for commercial truck builds is uncertain due to North American economic conditions and tariff impacts [29] - The company expects revenue guidance for Q2 2025 to be around $1.99 billion, with EBITDA of $560 million and EPS of $0.86 [31][32] Other Important Information - The company received a credit rating upgrade from Fitch from BBB to BBB+, reflecting improved financial leverage and strong cash generation [14] - The company has a remaining authorization for share repurchases of approximately $2 billion as of April 2025 [16] Q&A Session Summary Question: Impact of air traffic growth on structures and fasteners - Management indicated that overall demand for travel is important for future investment and volume assumptions, but the backlog in aircraft manufacturing provides some protection [35][36] Question: Progress on upgraded turbine airfoils and certification timing - Production is on track, with certification for the LEAP-1B expected by the end of the calendar year [43][44] Question: Margin improvements in fastening systems and engineered structures - Improvements are attributed to enhanced process control and operational efficiencies, with expectations for sustainability [50][51] Question: Update on production rates for the 737 and widebody aircraft - Production rates for the 737 have been increased, while widebody production has faced delays but demand remains strong [57][58] Question: Tariff impacts and mitigation strategies - The gross impact of tariffs is estimated at $80 million, with a net impact of less than $15 million after mitigation efforts [88][92]

First Quarter 2025 Earnings Call John Plant: Executive Chairman and Chief Executive Officer Ken Giacobbe: EVP and Chief Financial Officer May 1, 2025 Important Information Forward–Looking Statements This presentation contains statements that relate to future events and expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those containing such words as "anticipates", "believes", "could", " ...

Group 1 - Airbus receives positive analyst attention with Barclays lowering its price target to 185 euros while maintaining an "overweight" rating, and Kepler Cheuvreux upgrading it to "buy" with a 170-euro price target [1] - Airbus stock has declined about 8% over the past month due to macroeconomic recession concerns but has rebounded by approximately 10% in the last three weeks [2] - Boeing has received an upgrade to "outperform" from Bernstein SocGen, indicating a potential recovery as it addresses issues with its 737 MAX program and plans to increase production [3] Group 2 - Airbus reported a profit of $4.4 billion last year, contrasting with Boeing's loss of $11.5 billion, and is projected to grow earnings to $5.8 billion this year, while Boeing may struggle to earn anything [4] - By 2026, Airbus profits could reach $7.3 billion, nearly double Boeing's expected earnings of $4 billion, highlighting Airbus's stronger operational performance [4] - Despite Airbus trading at 26 times earnings, it is considered a stronger investment compared to Boeing, raising questions about why Airbus is not receiving similar upgrades [4]