Hexcel Corporation Reports 6.4% Increase in Net Sales for Fiscal Year 2024

Hexcel Corporation reported a consolidated net sales increase of 6.4% for the fiscal year ended December 31, 2024, reaching $1.903 billion, compared to $1.789 billion in 2023. The growth was primarily driven by a significant rise in the Commercial Aerospace segment, which saw sales increase by 11.8% to $1.194 billion, bolstered by demand for wide-body aircraft such as the Boeing 787 and Airbus A350. However, the Engineered Products segment also contributed positively, with sales rising 18.2% to $372 million, reflecting strong performance in military applications. In contrast, the Industrial segment experienced a decline of 20.9%, attributed to reduced demand across various sub-markets.

The company's operating income for 2024 was $186.1 million, down from $215.3 million in 2023, resulting in an operating margin of 9.8%. This decrease was largely due to $50 million in other operating expenses, which included asset impairments and restructuring costs. Despite these challenges, Hexcel's net income increased to $132.1 million, or $1.59 per diluted share, compared to $105.7 million, or $1.24 per diluted share, in the previous year. The improved net income was supported by higher sales volumes and a slight increase in gross margin percentage from 24.2% to 24.7%.

In terms of strategic developments, Hexcel completed the sale of its 50% interest in the Aerospace Composites Malaysia joint venture to Boeing in December 2023, which allowed the company to streamline its operations. Additionally, the company is exploring strategic options for its Neumarkt, Austria plant, which has been classified as held for sale. Hexcel also resumed construction of a new carbon fiber production line in Decatur, Alabama, expected to be operational by 2028, to meet growing demand in aerospace markets.

Operationally, Hexcel employed 5,894 full-time employees as of December 31, 2024, an increase from 5,590 in 2023. The company continues to focus on enhancing its workforce capabilities to align with business demand. Geographically, Hexcel's sales were well-distributed, with approximately 50% of production and 59% of customer sales occurring outside the United States. The company reported strong customer relationships, with approximately 40% of net sales attributed to Airbus and its subcontractors, and 15% to Boeing and its subcontractors.

Looking ahead, Hexcel anticipates continued growth in the Commercial Aerospace market, driven by increasing air travel and the need for fleet renewal. However, the company remains cautious about potential challenges, including supply chain disruptions and inflationary pressures that could impact production rates. The company expects to leverage its operational efficiencies and strategic investments to navigate these challenges and maintain its competitive position in the advanced composites industry.