Company: SPR
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001628280-25-021582
Chunk: 13

Company: Spirit AeroSystems Holdings, Inc.
Filing Date: 2025-05-01
Form: 10-Q
Item: Part I, Item 2
Chunk 13
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220 programs, compared to excess capacity cost of $26.1 million in the same period of the prior year. In the first quarter of 2025, we recognized $7.7 million of unfavorable cumulative catch-up adjustments related to periods prior to the first quarter of 2025, and $293.4 million of net forward loss charges. As mentioned in Note 4 Changes in Estimates to our condensed consolidated 

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financial statements included in Item 1 of Part I of this Quarterly Report, the forward losses recorded in the first quarter of 2025 were primarily driven by schedule changes, current production performance, and supply chain cost growth on the A350 and A220 programs, schedule changes, production cost and supply chain cost growth on the B787 program, increased costs related to factory performance on the B767 program and supply chain cost estimates on the KC-135 program. In the first quarter of 2024, we recorded $39.2 million of unfavorable cumulative catch-up adjustments related to periods prior to the first quarter of 2024, and $495.4 million of net forward loss charges primarily driven by a change in strategic pricing conversations with our customer, Airbus, incremental orders Airbus secured, foreign currency impacts, and supply chain cost growth on the A350 and A220 programs, additional labor and supply chain cost growth on the B787 program, and increased costs related to factory performance and supply chain costs on the B767 program.  

SG&A and Research and Development.  Current period SG&A was higher than in the prior year period by $10.3 million, primarily due to increased purchased services for merger-related activities and certain employee retention-related expenditures outlined in the Merger Agreement of $7.3 million. Research and development expenses increased for the three months ended April 3, 2025, as compared to the same period in the prior year primarily due to additional project spending year-over-year.  

Operating (Loss) Income.  Operating loss for the three months ended April 3, 2025 was $(487.0) million, a decrease of $40.6 million, compared to operating loss of ($527.6) million for the same period in the prior year. The variance reflects the lower negative cumulative catch-up adjustments and lower forward losses detailed above in addition to the gains on sales of businesses, partially offset by the reduction in Boeing program production and margins, higher excess capacity costs, and the previously described specific warranty charge.

Interest Expense and Financing Fee Amortization.  Interest expense and financing fee