Spirit AeroSystems Holdings, Inc Fourth Quarter and Full-Year 2006 - PowerPoint PPT Presentation

Spirit AeroSystems Holdings, Inc Fourth Quarter and Full-Year 2006 Performance Review Jeff Turner President and Chief Executive Officer Rick Schmidt Chief Financial Officer February 08, 2007

2006 Summary • Strong operational performance across segments… Supported customers with increased unit deliveries • Expanded our customer base … Won new business from existing customers and gained new customers • Began establishing ourselves in new markets segments … Established international operations in Europe • Continued to invest in next generation technologies, while improving our low cost structure • Successful Initial Public Offering Executing our strategy… Strong performance 2

Fuselage Systems Revenues & Adjusted Segment Margins Delivered 1 st 737-900ER (extended • Millions range) fuselage $1,400 25% $1,174 19.4% * $1,200 20% $1,000 17.7% Delivered 2000 th 737 Next 15% $800 • 11.0% $600 10% $396 Generation Fuselage $288 $400 5% $200 $0 0% Delivered 600 th 777 Forward • 2005Q4 2006Q1-Q3 2006Q4 Fuselage • Built and shipped 5 Wedge Tail Peace Eagle units • Successfully managed rate increases on 737 and 777… Increased margins 737 Production Exceptional performance while meeting customers increased demand *Adjusted segment margin is a non-GAAP measure. Definitions, reconciliations and further disclosures regarding non-GAAP measures are provided in the company’s earnings press release dated February 8, 2007. 3

Propulsion Systems Delivered the 1 st 787 Rolls Royce • Revenues & Adjusted Segment Margins Pylons Millions $800 20% $669 * 16.9% $600 15% 14.9% Delivered the 1 st 787 GE Pylon • $400 10% 6.9% $219 $200 $170 5% • Awarded new customer nacelle $0 0% 2005Q4 2006Q1-Q3 2006Q4 program and engine build-Up • Awarded 747-8 Pylon and Nacelle… Additional work statement • Delivered 2000th Unit of 737 Strut and Thrust Reverser • Increased production rates and margins 777 Thrust Reverser World class propulsion technology… Expanding into new market segments *Adjusted segment margin is a non-GAAP measure. Definitions, reconciliations and further disclosures regarding non-GAAP measures are provided in the company’s earnings press release dated February 8, 2007. 4

Wing Systems Revenues & Adjusted Segment Margins • Acquired Spirit Europe… Millions Successful integration to-date $600 15% 11.4% * $491 $500 10% $400 Delivered 3000 th A320 6.3% 5% • $300 $229 0% components and increased $200 -5% production rates $100 $85 $0 -10% -8.7% 2005Q4 2006Q1-Q3 2006Q4 Delivered the 1 st 787 Wing Fixed • Leading Edge • Added new customer programs • Increased production rates and margins Spirit Europe Growing the business… Expansion into Airbus products *Adjusted segment margin is a non-GAAP measure. Definitions, reconciliations and further disclosures regarding non-GAAP measures are provided in the company’s earnings press release dated February 8, 2007. 5

787 Program • Excellent progress… – Completed three contoured fuselage test barrels – Delivered four engine pylons – Delivered the first wing fixed leading edge – Delivering on or before customer Cockpit Structure Cockpit Structure Installed need dates • Production concepts and processes being tested and refined • Units for initial flight test aircraft are in production • Working closely with customer to achieve program requirements Wing Leading Edge Engine Pylon Integration A Leader in composite technology… Customer focused execution plan 6

Financial Update Rick Schmidt Chief Financial Officer February 08, 2007

2006 Financial Summary • Strong top-line performance – Reported Q4 revenues $852M, up 53% over Q4 2005 • Solid operating margins across the business – Q4 Adjusted Pre-tax margins* 10.4% and full-year adjusted Pre-tax margins* 8.2% • Excellent operating cash flow – Reported cash flow from operations $272M, includes $191M cash outflow related to IPO • Healthy balance sheet – $184M cash balance – $100M debt reduction… Improved debt to total capital ratio from 69% to 42% – Expanded revolver capacity to $400 million – Upgraded by S&P and Moody’s • Forecasting 25% revenue growth and increasing operating margins in 2007 Financially strong *Adjusted pre-tax margins are non-GAAP measures. Definitions, reconciliations and further disclosures regarding these non-GAAP measures are provided in the company’s earnings press release dated February 8, 2007. 8

2006 Financial Results 2006Q3 2006Q4 Full Year 2006 (Millions) Revenues $830 $852 $3,208 Pre-tax Income 73 (245) (72) Pre-tax Margins 8.8% -28.8% -2.2% Initital Public Offering Expense - ($334) ($334) Adjusted Pre-tax Earnings* $73 $89 $262 Adjusted Pre-tax Margins* 8.8% 10.4% 8.2% Top-line growth… Increased profitability *Adjusted pre-tax margins and earnings are non-GAAP measures. Definitions, reconciliations and further disclosures regarding these non- GAAP measures are provided in the company’s earnings press release dated February 8, 2007. 9

2006 Full-Year Net Income ($ Millions) 250 (75) 42 200 Net Income 212 150 209 100 50 17 0 2006 Net Income IPO Related Costs Tax Valuation As Reported Allowance Earnings Per $0.15 ($1.81) $0.36 Share Non-recurring items in 4Q2006 impacted full-year results 10

Year-End Cash and Debt Balances Millions Millions Credit Ratings Debt Cash S&P: BB Moody’s: Ba3 $800 $300 $250 $600 $200 $400 $150 722 241 618 $100 184 $200 $50 $- $- 2005 2006 2005 2006 • Cash from Operations $272M including • Debt reduction $104M $191M cash outflow related to IPO • Restructured debt agreements… Lowered • IPO net cash outflow $42M interest rate, reduced covenants • Acquisition of Spirit Europe $145M • Increased credit facility to $400M • Cap Ex of $343M primarily for 787 • Upgraded by rating agencies Healthy balance sheet… Strong liquidity 11

Full-Year Cash Flow 2005 1 $ Millions 2006 2005 Net Earnings $ (90) $ 17 • Divested from Boeing Depreciation and Amortization $ 32 $ 63 • 787 advance payments Other non-cash items $ 25 $ 161 2006 Working Capital (Increase)/Decrease $ 44 $ (205) • BAE Prestwick acquisition Customer Advances $ 200 $ 400 • Successful IPO IPO Cash Outflow $ - $ (191) – Debt reduction Other $ 13 $ 27 – Union Equity Participation Operating Cash Flow $ 224 $ 272 disbursements Capital Expenditures $ (145) $ (343) • 787 advance payments 1 Spirit's 2005 full-year w as from June 17, 2005 through December 29, 2005 Healthy cash flow from operations… Investing to grow! 12

2007 Financial Guidance $4.0B - $4.1B Revenues $400M - $420M Operating Earnings 9.8% - 10.5% % of Revenues $120M - $125M Depreciation and Amortization $1.80 - $1.90 Earnings Per Share (Fully Diluted) ~34% Effective Tax Rate + / - $280M Cash Flow from Operations + / - $300M Capital Expenditures + / - $45M Customer Advances 25% revenue growth in 2007… Growing EPS 13

Looking Ahead Executing our strategy… • Delivering on our commitments… Customer focused • Growing the business profitably • Continuous focus on productivity • Expanding our customer base • Investing in next generation technologies • Building financial strength Executing our strategy for Long-Term Value Creation 14