By Abhijith Ganapavaram and Valerie Insinna
(Reuters) -Spirit AeroSystems on Wednesday announced $101 million in forward losses on key Boeing and Airbus aircraft production and cut its full-year forecast for 737 fuselage deliveries as it grapples with a production defect.
The aerospace supplier took a $47.3 million charge on the Boeing 787 Dreamliner program and a $22.7 million loss on the Airbus A350 program due to higher supply chain and labor costs.
Spirit now expects to deliver 345 to 360 narrowbody 737 fuselages to Boeing in 2023, compared with its prior forecast of 370 to 390 units.
The lower delivery guidance forced Spirit to increase its anticipated cash burn for the year to between $275 and $325 million, compared with the $200 million to $250 million range.
Shares were up 1.3% in premarket trade.
One of the industry’s largest suppliers, Spirit has been struggling to stabilize cash flows due to rising labor costs and persistent inflationary pressures.
To add to its troubles, its largest customer Boeing in October expanded scope of their ongoing inspections of a production defect affecting 737 MAX 8 aircraft.
Last week, Boeing cut its own annual 737 delivery forecast from at least 400 aircraft to between 375-400 jets due to quality woes at Spirit.
Spirit reported a third-quarter adjusted loss per share of $1.42, lesser than the average analysts’ expectation of a loss of $1.54 per share, according to LSEG data.
Revenue rose 13% to $1.43 billion, compared with estimates of $1.46 billion.
Spirit on Wednesday said third-quarter cash burn was $136 million, compared with a cash burn of $73 million a year ago.
(Reporting by Abhijith Ganapavaram in Bengaluru; Editing by Maju Samuel and Louise Heavens)
