Howmet Aerospace Q3 2022 Earnings Report
Key Takeaways
Howmet Aerospace reported Q3 2022 revenues of $1.43 billion, up 12% year over year, driven by growth in the commercial aerospace market. Net income was $80 million, or $0.19 per share, compared to $27 million, or $0.06 per share, in Q3 2021. Net income excluding special items was $152 million, or $0.36 per share, versus $120 million, or $0.27 per share, in Q3 2021.
Revenue of $1.43 billion, up 12% year over year, driven by Commercial Aerospace, up 23% YoY
Net income of $80 million, or $0.19 per share, versus $27 million, or $0.06 per share, in the third quarter 2021
Net income excluding special items of $152 million, or $0.36 per share, versus $120 million, or $0.27 per share, in the third quarter 2021
Adjusted EBITDA excluding special items of $323 million, up 11% year over year
Howmet Aerospace
Howmet Aerospace
Howmet Aerospace Revenue by Segment
Forward Guidance
The company expects 2023 revenue growth versus 2022 to be up approximately 10%, plus or minus 2%.
Positive Outlook
- Expect commercial aerospace end market to grow at above-trend rates for the next several years.
- Defense aerospace market should return to growth starting in the middle of 2023.
- Company's balance sheet remains strong.
- Company is positioned to continue generating strong cash flows ahead.
- Company doubled the quarterly dividend on common stock to $0.04 per share for the fourth quarter 2022.
Challenges Ahead
- Cash flows were impacted as Howmet Aerospace carried higher inventory due to customer schedule rebalances.
- Customer schedule rebalances are expected to persist in the fourth quarter.
- Adjusted EBITDA margin, excluding special items, was down approximately 30 basis points year over year at 22.5% while passing through approximately $70 million of additional material costs year over year.
- Wheels segment was impacted by higher aluminum material costs and higher European energy costs.
- Wheels segment was unfavorably impacted by foreign currency movements.