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• Total Sales (2024): $1.903 billion, a 6.4% increase over 2023.

• Fourth-Quarter Sales (2024): $474 million, a 4% increase year over year in constant currency.

• Adjusted EPS (2024): $2.03.

• Free Cash Flow (2024): $203 million.

• Commercial Aerospace Sales (Q4 2024): $278.3 million, a 4.6% increase year over year.

• Space & Defense Sales (Q4 2024): $163.3 million, a 7.6% increase year over year.

• Industrial Sales (Q4 2024): $32.2 million, a 14.8% decrease year over year.

• Gross Margin (Q4 2024): 25%, compared to 22.5% in Q4 2023.

• Adjusted Operating Income (Q4 2024): $57.1 million, or 12.1% of sales.

• Net Cash Provided by Operating Activities (2024): $289.9 million.

• Capital Expenditures (2024): $81.1 million.

• Adjusted EBITDA (2024): $382.3 million.

• Share Repurchase (2024): $252.2 million used for repurchasing stock.

• Dividend Increase: Quarterly dividend increased to $0.17 per share.

• 2025 Sales Guidance: $1.95 billion to $2.05 billion.

• 2025 Adjusted EPS Guidance: $2.05 to $2.25.

• 2025 Free Cash Flow Guidance: Greater than $220 million.

• Warning! GuruFocus has detected 5 Warning Signs with HXL.

Release Date: January 23, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Hexcel Corp (NYSE:HXL) reported a 6.4% increase in sales for 2024, reaching $1.903 billion, which marginally exceeded their guidance targets.

• The company achieved a 21% increase in adjusted EPS for Q4 2024 compared to Q4 2023, indicating strong financial performance.

• Commercial Aerospace sales increased by 11.9% for the full year, driven by strong demand for aircraft like the 787, A350, and A320neo.

• Space & Defense sales grew by 7.6% in Q4 2024 and 4.6% for the full year, supported by programs like the F-35 and CH-53K.

• Hexcel Corp (NYSE:HXL) generated a free cash flow of $202.9 million in 2024, up from $148.9 million in 2023, due to increased volume and effective working capital management.

Negative Points

• Industrial sales decreased by 14.8% in Q4 2024 and 21.1% for the full year, with weakness across most submarkets except recreation.

• The company is divesting its Neumarkt, Austria site due to underperformance in industrial applications, indicating challenges in this segment.

• Hexcel Corp (NYSE:HXL) faces potential margin pressures in 2025 due to elevated R&D spending and existing headcount costs.

• The company anticipates continued supply chain challenges and potential delays in production rate recovery, impacting 2025 sales growth.

• Hexcel Corp (NYSE:HXL) did not repurchase any stock in Q4 2024, despite having a significant authorization remaining, which may concern some investors.