Company: SPR
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001628280-25-037839
Chunk: 34

Company: Spirit AeroSystems Holdings, Inc.
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 2
Chunk 34
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3, we received two equal advance payments from Airbus of $50.0 million each under an agreement between Airbus S.A.S. and Spirit AeroSystems (Europe) Limited (“Spirit Europe”) signed on June 23, 2023 (the “A350 Agreement”). The A350 Agreement provided for up to $100.0 million of advances that were originally required to be repaid along with a nominal fee to Airbus by way of offset against the purchase price of A350 FLE shipset deliveries in 2025. To the extent actual deliveries in 2025 were insufficient to offset the advance amount, any amount not offset against deliveries would have been due and payable to Airbus per the terms of the Purchase Agreement. However, per the terms of the Purchase Agreement, these payments will not be offset against deliveries but instead be due at the closing of the divestiture of the Airbus businesses. As of July 3, 2025, we had $102.5 million outstanding under this agreement, including $2.5 million of capitalized interest. Related to the A350 Agreement, Spirit Europe has pledged certain program assets including work in process inventories and raw materials at Spirit’s Scotland facility in an amount sufficient to cover the advances. As the Airbus advance will be repaid to Airbus at the closing of the divestiture, those repayments will effectively reduce financing cash flow in 2025.

Operational Impacts of Alaska Airlines Incident

The B737 MAX 9 derivative fleet was temporarily grounded by the FAA while certain safety inspections were completed and to allow the FAA time to review any required maintenance actions following the January 5, 2024 in-flight incident on a B737 MAX 9 aircraft flown by Alaska Airlines. The B737 MAX 9 fleet returned to service on January 26, 2024 after mandatory inspections were completed. We are participating in investigations relating to this incident. As discussed in Item 1A. 

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“Risk Factors” in our 2024 Form 10-K, we are currently unable to fully estimate what impact this incident, including any impacts of investigations, will have on our near or long-term financial position, results of operations and cash flows. 

However, certain changes made to the production and delivery process implemented by Boeing have had an immediate impact to our results of operations and cash flows. On March 2, 2024, Boeing announced they would no longer accept deliveries of product that required out of sequence assembly or incremental quality re-work. A new product verification process was implemented by Boeing at