Hexcel, Albany International Q2 2022 financial reports reflect increased revenue

Albany International Corp. (Rochester, N.H., U.S.) and Hexcel (Stamford, Conn., U.S.) have recently reported positive Q2 2022 results which ended June 30, 2022. Both companies noted performance consistency and business growth in some regard.

According to Albany International President and Chief Executive Officer (CEO), Bill Higgins, “Our revenue of $261 million was up on both a year-over-year and sequential basis driven by growth in our Engineered Composites segment from recovering commercial aircraft production and previously announced new business wins. Second quarter GAAP earnings per share was $1.25, which benefited from 20 cents of currency revaluation gains. Adjusted earnings per share was $1.06 up from $1.01 reported last year.”

Highlighted results include:

• Net sales were $261.4 million, up 11.5%, or 14.6% after adjusting for currency translation, when compared to the prior year, primarily due to year-over-year growth in sales related to the CH-53K and LEAP programs within the Engineered Composites segment.
• Gross profit of $100.6 million was 1.1% lower than the $101.7 million reported for the same period of 2021.
• Selling, Technical, General and Research (STG&R) expenses were $49.9 million, compared to $51.8 million in the same period of 2021. The decrease was driven by the favorable effect of the revaluation of foreign currency in the Machine Clothing segment.
• Operating income was $50.7 million, compared to $50.0 million in the prior year, an increase of 1.5%.
• The effective tax rate was 26.9%, compared to 30.0% for the second quarter of 2021. This year-over-year decrease was mainly due to favorable discrete tax adjustments recognized in the second quarter of 2022.
• Net income attributable to the company was $39.2 million ($1.25 per share), compared to $31.4 million ($0.97 per share) in the second quarter of 2021. Adjusted earnings per share (or Adjusted EPS, a non-GAAP measure) was $1.06 per share in the second quarter of 2022, compared to $1.01 in the same period of last year.
• Adjusted EBITDA (a non-GAAP measure) was $66.0 million, compared to $69.4 million in the second quarter of 2021, a decrease of 4.9%.

As “risks remain in 2022 in the form of ongoing inflation, supply chain and logistics challenges, and the indirect effects of the Russian invasion of Ukraine,” Albany’s updated outlook for 2022 incorporates these risks. This includes total company revenue of between $970 million and $1.01 billion; and Albany Engineered Composites revenue of between $380 and $400 million.

See complete full-year 2022 guidance and tables for a reconciliation of non-GAAP measures to their comparable GAAP measures here.

Hexcel reported Q2 2022 results including net sales of $393 million and adjusted diluted EPS of $0.33 per share (compared to $320.3 in Q2 2021). Sales for the first six months of 2022 were $783.6 million compared to $630.6 million for the same period in 2021. The company notes that “the second quarter demonstrated our continued ability to deliver solid results and to perform consistently in the face of supply chain disruptions and inflationary pressures, which we expect to be present at least through the end of 2022.”

According to Chairman, CEO and President Nick Stanage, the company remains “encouraged by the ongoing recovery in air travel that is supporting growth in the commercial aerospace market, as well as the strength in Space and Defense and the success that our Industrial team is achieving in both existing and new markets. We continue to tightly manage our cost base and focus strongly on working capital as our business grows. Our key priorities continue to be meeting the needs of our customers, optimizing incremental margins and driving innovation to support the global drive for fuel efficiency and emissions reduction from composites lightweighting.”

Total sales in comparison to Q2 2021 include:

• Commercial Aerospace: Sales of $227.6 million increased 48.1% (49.5% in constant currency) led by growth in the A350, A320neo and 737 MAX programs.
• Other Commercial Aerospace sub-category: Increased 75.4%.
• Space & Defense: Sales of $111.9 million increased 4.7% (7.0% in constant currency) with growth in space, CH-53K heavy-lift helicopter and a number of international programs.
• Industrial: Total sales of $53.5 million in the second quarter of 2022 decreased 10.4% (3.5% in constant currency) impacted by lower wind energy sales and foreign exchange, was only partially offset by growth in automotive, recreation and other industrial sales.

Additional results include:

• Gross margin for Q2 2022 was 22.8% compared to 2021’s 19.3%, as higher sales volume drove favorable operating leverage.
• As a percentage of sales, selling, general and administrative and R&T expenses for the second quarter of 2022 were 11.4% compared to 13.3%.
• Adjusted operating income reached $44.7 million or 11.4% of sales, compared to $19.3 million, or 6.0% of sales in 2021.
• Other operating income included a pre-tax net gain of $19.4 million from the sale of Hexcel’s Dublin, Calif., U.S., site as the company transfers its R&T laboratory from Dublin to a new flagship Center of Research & Technology Excellence in Salt Lake City, Utah. 

Hexcel reports that its 2022 guidance remains unchanged including sales of $1.50 billion to $1.63 billion.

See complete guidance information and operations result summaries here.