Company: SPR
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0001628280-25-009088
Chunk: 152

Company: Spirit AeroSystems Holdings, Inc.
Filing Date: 2025-02-28
Form: 10-K
Item: Item 7
Chunk 152
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 includes excess capacity production costs of $7.8 million related to the temporary B737 production schedule changes and a $2.3 million offset of costs related to the AMJPP. In 2023, the segment recorded unfavorable cumulative catch-up adjustments of $10.6 million and $30.7 million of net forward loss charges. In comparison, during 2022, the segment recorded favorable cumulative catch-up adjustments of $2.4 million and $6.4 million of net forward loss charges.

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Aftermarket Segment.  Aftermarket segment net revenues for the twelve months ended December 31, 2023 were $373.9 million, an increase of $62.5 million, or 20.1%, compared to the same period in the prior year, reflecting greater spare part sales and increased maintenance, repair, and overhaul (“MRO”) sales activity. Aftermarket segment operating margins were 22% for the twelve months ended December 31, 2023, compared to 19% for the same period in the prior year. The twelve months ended December 31, 2023 includes an offset of $2.4 million of benefit related to the settlement of a contingent consideration obligation related to a prior year acquisition. The twelve months ended December 31, 2022 includes $4.4 million of the total charge, mentioned above, in relation to the suspension of activities in Russia and $1.9 million of offset to costs related to the AMJPP.

Liquidity and Capital Resources 

We assess our liquidity in terms of our ability to generate cash to fund our operating, investing, and financing activities. Our principal sources of liquidity are operating cash flows from continuing operations and borrowings to finance our business operations. Our operating cash flows from continuing operations have been adversely impacted by, among other things, the B737 MAX grounding, the COVID-19 pandemic, production rate changes for the B737 MAX program and other programs, the impact of inflation on labor and supply chain costs, supply chain disruptions, and labor shortages affecting our business. We expect those adverse impacts to continue for 2025 and beyond. For purposes of assessing our liquidity needs in this section, we have assumed that Boeing would not further reduce the B737 MAX production rate and that other customers generally would not further reduce their production rates. For risks that may affect that assumption, see Item 1A “Risk Factors.” 

Our consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) on