Howmet Aerospace Inc

Previous wording

In the first quarter of 2024, the Company derived approximately 51% of its revenue from products sold to the commercial aerospace market which is less than the pre-pandemic 2019 annual rate of approximately 60%. Aircraft production in the commercial aerospace industry continues to recover based on increases in demand for narrow body and wide body aircraft. We expect commercial aerospace wide body demand to grow faster than narrow body demand on a production percentage basis. Quality control issues at The Boeing Company (“Boeing”) are expected to negatively impact narrow body and wide body production rates in the near term. For instance, the Federal Aviation Administration stated that it will not approve production rate increases or additional production lines for the Boeing 737 MAX until it is satisfied that Boeing is in full compliance with required quality control procedures. Boeing production levels have a material impact on the financial performance of Howmet. The timing and level of future aircraft builds by original equipment manufacturers (“OEM”) are subject to changes and uncertainties, which may cause our future results to differ from prior periods due to changes in product mix in certain segments.

Current wording

In the six months ended June 30, 2024, the Company derived approximately 51% of its revenue from products sold to the commercial aerospace market which is less than the pre-pandemic 2019 annual rate of approximately 60%. Aircraft production in the commercial aerospace industry continues to recover based on increases in demand for narrow body and wide body aircraft. We expect commercial aerospace wide body demand to grow faster than narrow body demand on a production percentage basis. Quality control issues at The Boeing Company (“Boeing”) are expected to negatively impact narrow body and wide body production rates in the near term. For instance, the Federal Aviation Administration stated that it will not approve production rate increases or additional production lines for the Boeing 737 MAX until it is satisfied that Boeing is in full compliance with required quality control procedures. Boeing production levels have a material impact on the financial performance of Howmet. The timing and level of future aircraft builds by original equipment manufacturers (“OEM”) are subject to changes and uncertainties, which may cause our future results to differ from prior periods due to changes in product mix in certain segments.

Previous wording

Sales. Sales were $1,824 in the first quarter of 2024 compared to $1,603 in the first quarter of 2023. The increase of $221, or 14%, in the first quarter of 2024 was primarily due to higher volumes from the commercial aerospace, defense aerospace, and industrial and other markets, and favorable product pricing.

Current wording

Sales. Sales were $1,880 in the second quarter of 2024 compared to $1,648 in the second quarter of 2023 and $3,704 in the six months ended June 30, 2024 compared to $3,251 in the six months ended June 30, 2023. The increase of $232, or 14%, in the second quarter of 2024 and the increase of $453, or 14%, in the six months ended June 30, 2024 was primarily due to higher volumes in the commercial aerospace, defense aerospace, and industrial and other markets, and favorable product pricing partially offset by lower volumes in the commercial transportation market.

Previous wording

Cost of goods sold (“COGS”). COGS as a percentage of Sales was 70.7% in the first quarter of 2024 compared to 72.6% in the first quarter of 2023. The decrease in the first quarter of 2024 was primarily due to higher volumes and favorable product pricing, partially offset by increased net headcount in the Engine Products, Fastening Systems and Engineered Structures segments, in support of expected revenue increases. There were no COGS charges in the first quarter of 2024 related to fires that occurred at a Fastening Systems plant in France in 2019 (the “France Plant Fire”) and a mechanical failure resulting in substantial heat and fire-related damage to equipment at the Forged Wheel’s cast house in Barberton, Ohio in the third quarter of 2022 (the “Barberton Cast House Incident”), compared to total COGS charges of $4 in the first quarter of 2023, related to the France Plant Fire and Barberton Cast House Incident. The Company is negotiating resolution of the insurance claims related to the France Plant Fire and Barberton Cast House Incident.

Current wording

Cost of goods sold (“COGS”). COGS as a percentage of Sales was 68.5% in the second quarter of 2024 compared to 72.6% in the second quarter of 2023 and 69.6% in the six months ended June 30, 2024 compared to 72.6% in the six months ended June 30, 2023. The decrease in the second quarter and six months ended June 30, 2024 was primarily due to higher volumes and favorable product pricing, partially offset by increased net headcount, primarily in the Engine Products segment, in support of expected revenue increases. There were total COGS net reimbursements of $6 in the second quarter and six months ended June 30, 2024 related to a mechanical failure resulting in substantial heat and fire-related damage to equipment at the Forged Wheels’ cast house in Barberton, Ohio in the third quarter of 2022 (the “Barberton Cast House Incident”), compared to total COGS net reimbursements of $4 and net charges of zero in the second quarter and six months ended June 30, 2023, respectively, related to the fire that occurred at a Fastening Systems plant in France in 2019 (the “France Plant Fire”) and Barberton Cast House Incident. The Company is negotiating resolution of the insurance claim related to the France Plant Fire. The insurance claim related to the Barberton Cast House Incident was settled in the second quarter of 2024.

Previous wording

Selling, general administrative, and other expenses (“SG&A”). SG&A expenses were $88 in the first quarter of 2024 compared to $75 in the first quarter of 2023. The increase of $13, or 17%, in the first quarter of 2024 was primarily due to higher employment and legal costs.

Current wording

Selling, general administrative, and other expenses (“SG&A”). SG&A expenses were $97 in the second quarter of 2024 compared to $88 in the second quarter of 2023 and $185 in the six months ended June 30, 2024 compared to $163 in the six months ended June 30, 2023. The increase of $9, or 10%, in the second quarter of 2024 and $22, or 13% in the six months ended June 30, 2024 was primarily due to higher employment costs.

Previous wording

Restructuring and other charges. Restructuring and other charges were less than $1 in the first quarter of 2024 compared to $1 in the first quarter of 2023. Restructuring and other charges for the first quarter of 2024 were primarily due to a gain on the sale of assets at a small U.K. manufacturing facility in Engines Products of $1, partially offset by exit related costs, including accelerated depreciation, of $1. Restructuring and other charges for the first quarter of 2023 were primarily due to exit related costs, including accelerated depreciation, of $2, partially offset by a reversal of $1 for a layoff reserve related to a prior period.

Current wording

Restructuring and other charges. Restructuring and other charges were $22 in the second quarter of 2024 compared to $3 in the second quarter of 2023 or an increase of $19. Restructuring and other charges were $22 in the six months ended June 30, 2024 compared to $4 in the six months ended June 30, 2023 or an increase of $18. Restructuring and other charges for the second quarter and six months ended June 30, 2024 were primarily due to a loss on the sale of a small U.K. manufacturing facility in Engineered Structures of $14 and layoff costs of $7. Restructuring and other charges for the second quarter of 2023 were primarily due to charges for a U.S. pension plan settlement of $3. Restructuring and other charges for the six months ended June 30, 2023 were primarily due to charges for a U.S. pension plan settlement of $3 and exit related costs, including accelerated depreciation, of $2.

Previous wording

Interest expense, net. Interest expense, net was $49 in the first quarter of 2024 compared to $57 in the first quarter of 2023. The decrease of $8, or 14%, in the first quarter of 2024 was primarily due to a reduced average level of long-term debt.

Current wording

Interest expense, net. Interest expense, net was $49 in the second quarter of 2024 compared to $55 in the second quarter of 2023 and $98 in the six months ended June 30, 2024 compared to $112 in the six months ended June 30, 2023. The decrease of $6, or 11%, in the second quarter of 2024 and $14, or 13%, in the six months ended June 30, 2024 was primarily due to early partial redemptions of the 5.125% Notes due October 2024 (the “5.125% Notes”) in September 2023 and December 2023 that, in addition to the early partial redemptions of such notes in January 2023 and March 2023, reduced the average level of long-term debt.

Previous wording

Loss on debt redemption. Debt redemption or tender premiums include the cost to redeem or repurchase certain of the Company’s notes at a price which may be equal to the greater of the principal amount or the sum of the present values of the remaining scheduled payments, discounted using a defined treasury rate plus a spread, or a price based on the market price of its notes. There was no loss on debt redemption in the first quarter of 2024 compared to $1 in the first quarter of 2023, which was due to the debt premiums paid on the early partial redemption of the 5.125% Notes due October 2024 in the first quarter of 2023.

Current wording

Loss on debt redemption. Debt redemption or tender premiums include the cost to redeem or repurchase certain of the Company’s notes at a price which may be equal to the greater of the principal amount or the sum of the present values of the remaining scheduled payments, discounted using a defined treasury rate plus a spread, or a price based on the market price of its notes. Loss on debt redemption was less than $1 in the second quarter of 2024 compared to zero in the second quarter of 2023 and less than $1 in the six months ended June 30, 2024 compared to $1 in the six months ended June 30, 2023. The decrease in the six months ended June 30, 2024 was due to the debt premiums paid on the early partial redemption of the 5.125% Notes in the first quarter of 2023.

Previous wording

Other expense, net. Other expense, net was $17 in the first quarter of 2024 compared to $7 in the first quarter of 2023. The increase of $10 in the first quarter of 2024 was primarily due to a year over year increase in foreign currency losses of $5 and an increase from net realized and unrealized losses of $3. Non-service related net periodic benefit costs related to defined benefit plans is expected to increase by approximately $5 for the full year 2024 versus 2023.

Current wording

Other expense (income), net. Other expense, net was $15 in the second quarter of 2024 compared to Other income, net of $13 in the second quarter of 2023 and Other expense, net was $32 in the six months ended June 30, 2024 compared to Other income, net of $6 in the six months ended June 30, 2023. The increase in expense of $28 in the second quarter of 2024 was primarily due to the reversal in the second quarter ended June 30, 2023 of $25, net of legal fees of $1, (the “LBIE Reversal in 2023”) of the $65 pre-tax charge taken in the third quarter of 2022 related to the Lehman Brothers International (Europe) legal proceeding as a result of the final settlement of such proceeding in June 2023 (See Note Q to the Consolidated Financial Statements in Part I, Item I of this Form 10-Q for reference) and an increase of foreign currency losses of $4. The increase in expense of $38 in the six months ended June 30, 2024 was primarily due to the LBIE Reversal in 2023 and increases in foreign currency losses, net, of $9. Non-service related net periodic benefit costs related to defined benefit plans is expected to increase by approximately $5 for the full year 2024 versus 2023.

Previous wording

Provision for income taxes. The estimated annual effective tax rate, before discrete items, applied to ordinary income was 21.7% in the first quarter of 2024 compared to 23.4% in the first quarter of 2023. The tax rate including discrete items was 19.8% in the first quarter of 2024 compared to 32.7% in the first quarter of 2023. A discrete net tax benefit of $7 was recorded in the first quarter of 2024 compared to a discrete tax charge of $21, which included the income tax reserve recorded as a result of the French tax litigation (See Note P to the Consolidated Financial Statements in Part I, Item I of this Form 10-Q for reference), in the first quarter of 2023. The 2024 estimated annual effective tax rate is lower than the 2023 rate primarily due to a U.S. tax benefit recognized for foreign tax credits in 2024 and lower net U.S. tax on Global Intangible Low-Taxed Income and other foreign earnings.

Current wording

Provision for income taxes. The estimated annual effective tax rate, before discrete items, applied to ordinary income was 21.7% in both the second quarter and six months ended June 30, 2024 compared to 23.0% in both the second quarter and six months ended June 30, 2023. The tax rate including discrete items was 20.4% in the second quarter of 2024 compared to 20.6% in the second quarter of 2023. A discrete tax benefit of $5 was recorded in the second quarter of 2024 compared to a discrete net tax benefit of $7 in the second quarter of 2023. The tax rate including discrete items was 20.1% in the six months ended June 30, 2024 compared to 26.3% in the six months ended June 30, 2023. A discrete net tax benefit of $12 was recorded in the six months ended June 30, 2024 compared to a discrete net tax charge of $14, which included the income tax reserve recorded as a result of the French tax litigation (See Note Q to the Consolidated Financial Statements in Part I, Item I of this Form 10-Q for reference), recorded in the six months ended June 30, 2023. The 2024 estimated annual effective tax rate is lower than the 2023 rate primarily due to a U.S. tax benefit recognized for foreign tax credits in 2024 and lower net U.S. tax on Global Intangible Low-Taxed Income and other foreign earnings.

Previous wording

Net income. Net income was $243, or $0.59 per diluted share, in the first quarter of 2024 compared to $148, or $0.35 per diluted share, in the first quarter of 2023. The increase of $95 in the first quarter of 2024 was primarily due to higher volumes in the commercial aerospace and defense aerospace markets, favorable product pricing, and a reduction in interest expense due to lower long-term debt levels.

Current wording

Net income. Net income was $266, or $0.65 per diluted share, in the second quarter of 2024 compared to $193, or $0.46 per diluted share, in the second quarter of 2023 and $509, or $1.23 per diluted share, in the six months ended June 30, 2024 compared to $341, or $0.81 per diluted share, in the six months ended June 30, 2023. The increase of $73 in the second quarter of 2024 and $168 in the six months ended June 30, 2024 was primarily due to higher volumes in the commercial aerospace, defense aerospace, and industrial and other markets, favorable product pricing, and a reduction in interest expense due to lower long-term debt levels.

Previous wording

Segment Adjusted EBITDA for the Engine Products segment increased $37, or 17%, in the first quarter of 2024 compared to the first quarter of 2023, primarily due to higher volumes in the commercial aerospace, defense aerospace, and oil and gas markets. The segment absorbed approximately 435 net headcount in the first quarter of 2024, in support of expected revenue increases, resulting in unfavorable near-term recruiting, training and operational costs.

Current wording

Segment Adjusted EBITDA for the Engine Products segment increased $106, or 24%, in the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to growth in the commercial aerospace, defense aerospace, oil and gas, and industrial gas turbine markets. The segment absorbed approximately 750 net headcount in the six months ended June 30, 2024, in support of expected revenue increases, resulting in unfavorable near-term recruiting, training and operational costs.

Previous wording

Segment Adjusted EBITDA Margin for the Engine Products segment increased approximately 140 basis points in the first quarter of 2024 compared to the first quarter of 2023, primarily due to higher volumes in the commercial aerospace, defense aerospace, and oil and gas markets, partially offset by an increase in headcount and inflationary costs.

Current wording

Segment Adjusted EBITDA Margin for the Engine Products segment increased approximately 290 basis points in the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to growth in the commercial aerospace, defense aerospace, oil and gas, and industrial gas turbine markets, partially offset by an increase in headcount and inflationary costs.

Previous wording

Third-party sales for the Engineered Structures segment increased $55, or 27%, in the first quarter of 2024 compared to the first quarter of 2023, primarily due to higher volumes in the commercial aerospace market, including wide body recovery, and defense aerospace market.

Current wording

Third-party sales for the Engineered Structures segment increased $75, or 38%, in the second quarter of 2024 compared to the second quarter of 2023, primarily due to growth in the commercial aerospace market, including wide body recovery, and the defense aerospace market.

Previous wording

Segment Adjusted EBITDA Margin for the Engineered Structures segment decreased approximately 40 basis points in the first quarter of 2024 compared to the first quarter of 2023, primarily due to an increase in headcount and inflationary costs, partially offset by higher volumes in the commercial aerospace and defense aerospace markets.

Current wording

Segment Adjusted EBITDA Margin for the Engineered Structures segment increased approximately 200 basis points in the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to growth in the commercial aerospace and defense aerospace markets, partially offset by an increase in headcount and inflationary costs.

Previous wording

Third-party sales for the Forged Wheels segment decreased $1 in the first quarter of 2024 compared to the first quarter of 2023, primarily due to a decrease in aluminum price and other inflationary cost pass through, mostly offset by higher volumes in the commercial transportation market.

Current wording

Third-party sales for the Forged Wheels segment decreased $20, or 7%, in the second quarter of 2024 compared to the second quarter of 2023, primarily due to lower volumes in the commercial transportation market as well as a decrease in aluminum price and other inflationary cost pass through.

Previous wording

Segment Adjusted EBITDA Margin for the Forged Wheels segment increased approximately 120 basis points in the first quarter of 2024 compared to the first quarter of 2023, primarily due to lower aluminum prices and other inflationary cost pass through.

Current wording

Segment Adjusted EBITDA Margin for the Forged Wheels segment decreased approximately 20 basis points in the second quarter of 2024 compared to the second quarter of 2023, primarily due to lower volumes in the commercial transportation market partially offset by aluminum prices and other inflationary cost pass through.

Previous wording

In 2024, as compared to 2023, demand in the commercial transportation markets served by Forged Wheels is expected to decrease in most regions due to lower OEM builds.

Current wording

In 2024, as compared to 2023, demand in the commercial transportation markets served by Forged Wheels is expected to decrease in the second half in most regions due to lower OEM builds.

Previous wording

Howmet Wheel Systems Mexico S. DE R.L. D.E. C.V. (“Howmet Mexico”) is working closely with Daimler Trucks North America (“DTNA”) to investigate two reports (involving four wheels) of potential rapid air loss associated with the steer axle applications for Part ULA18X Alcoa® Wheels that were manufactured by Howmet Mexico’s facility in Monterrey, Mexico between November 2022 and August 2023 (the “Affected Period”). None of the reported incidents resulted in fatalities or injuries. DTNA has filed a Defect Information Report with the National Highway Safety Transportation Administration (“NHTSA”) and a similar report with Transport Canada, which has initiated a recall of their units that utilize Part ULA18X Alcoa® Wheels manufactured during the Affected Period by Howmet Mexico that were sold in the United States and Canada. DTNA’s own filing states: “While the root cause investigation of these reports remains ongoing, out of an abundance of caution, on March 28, 2024, DTNA decided to initiate a recall to address this issue.” Howmet Mexico’s ongoing investigation to date has found that the rapid air loss reports submitted by DTNA are unsubstantiated. Howmet Mexico will continue to closely work with the NHTSA, Transport Canada, and DTNA regarding this matter. No other Alcoa Wheels are implicated. At this time, we do not expect the impacts to be material to the results of our operations.

Current wording

Howmet Wheel Systems Mexico S. DE R.L. D.E. C.V. (“Howmet Mexico”) has closed an investigation with Daimler Trucks North America (“DTNA”) related to two reports (involving four wheels) of potential rapid air loss associated with steer axle applications for Part ULA18X Alcoa® Wheels that were manufactured by Howmet Mexico’s facility in Monterrey, Mexico between November 2022 and August 2023. DTNA filed a Defect Information Report with the National Highway Safety Transportation Administration (“NHTSA”) and a similar report with Transport Canada, which initiated a recall for Part ULA18X Alcoa® Wheels manufactured during the Affected Period by Howmet Mexico that were sold in the United States and Canada. Following the investigation, it was determined that the rapid air loss events did not occur as reported. DTNA subsequently rescinded its recall with NHTSA on May 25, 2024 and Transport Canada will not require a recall. The impacts from this event were not material to the results of our operations.

Previous wording

See Restructuring and other charges, Interest expense, net, Loss on debt redemption, and Other expense, net discussions above, under “Results of Operations” for reference.

Current wording

See Restructuring and other charges, Interest expense, net, Loss on debt redemption, and Other expense (income), net discussions above, under “Results of Operations” for reference.

Previous wording

Corporate expense decreased $3, or 10%, in the first quarter of 2024 compared to the first quarter of 2023, primarily due to lower net costs related to the France Plant Fire and the Barberton Cast House Incident of $4, partially offset by higher employment and legal costs in 2024.

Current wording

Corporate expense decreased $13, or 38%, in the second quarter of 2024 compared to the second quarter of 2023, primarily due to lower costs associated with closures, supply chain disruptions, and other items of $10, lower costs related to the collective bargaining agreement negotiations of $7, and higher net reimbursements related to the France Plant Fire and the Barberton Cast House Incident of $2, partially offset by higher employment costs in 2024.

Previous wording

Cash provided from operations was $177 in the three months ended March 31, 2024 compared to $23 in the three months ended March 31, 2023. The increase of $154 was primarily due to higher operating results of $93, lower working capital of $55, and lower pension contributions of $7. The components of the change in working capital primarily included favorable changes in accounts payable of $89, inventories of $14, prepaid expenses and other current assets of $11, and receivables of $10, partially offset by compensation related payments and other accrued expenses of $68.

Current wording

Cash provided from operations was $574 in the six months ended June 30, 2024 compared to $252 in the six months ended June 30, 2023. The increase of $322 was primarily due to higher operating results of $217 and lower working capital of $111, partially offset by higher pension contributions of $5. The components of the change in working capital primarily included favorable changes in accounts payable of $86, receivables of $41, prepaid expenses and other current assets of $14, partially offset by $18 of taxes, including income taxes, inventories of $10 and compensation related payments and other accrued expenses of $2.

Previous wording

Cash used for financing activities was $178 in the three months ended March 31, 2024 compared to $214 in the three months ended March 31, 2023. The decrease of $36, or 17%, was primarily due to payments made in 2023 in connection with the reduction of long-term debt of $176 (See Note N to the Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for reference), partially offset by an increase in common stock repurchases of $125, taxes paid for the net share settlement of equity awards of $11, and increased dividends paid to common stock shareholders of $4 due to a $0.01 increase in dividends per common share. Future changes in common stock dividends are subject to the approval of the Board of Directors of Howmet.

Current wording

Cash used for financing activities was $301 in the six months ended June 30, 2024 compared to $403 in the six months ended June 30, 2023. The decrease of $102, or 25%, was primarily due to payments made in 2023 in connection with the reduction of long-term debt of $153 (See Note N to the Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for reference) and a decrease in taxes paid for the net share settlement of equity awards of $43, partially offset by an increase in common stock repurchases of $85 and increased dividends paid to common stock shareholders of $7 due to a $0.01 increase in dividends per common share.

Previous wording

The Company has an effective shelf registration statement on Form S-3, filed with the SEC, which allows for offerings of debt securities from time to time. The Company may opportunistically issue new debt securities in accordance with securities laws or utilize commercial paper in order to, but not limited to, refinance existing indebtedness. The Company continues to evaluate whether, when, and to what extent it may access capital markets, including any plans to refinance the 5.125% Notes due October 2024 and the 6.875% Notes due May 2025. Our ability to refinance our indebtedness or enter into alternative financings in adequate amounts on commercially reasonable terms, or terms acceptable to us, may be affected by circumstances and economic events outside of our control. In the event that a refinancing does not occur before the maturity dates of the Company’s 5.125% Notes and the 6.875% Notes, respectively, the Company believes that its projected cash on hand, availability under the Credit Facility, and its commercial paper program will enable the Company to repay, as applicable, the 5.125% Notes and/or the 6.875% Notes.

Current wording

The Company has an effective shelf registration statement on Form S-3, filed with the SEC, which allows for offerings of debt securities from time to time. The Company may opportunistically issue new debt securities in accordance with securities laws or utilize commercial paper in order to, but not limited to, refinance existing indebtedness. The Company continues to evaluate whether, when, and to what extent it may access capital markets, including any plans to refinance the 6.875% Notes due May 2025. Our ability to refinance our indebtedness or enter into alternative financings in adequate amounts on commercially reasonable terms, or terms acceptable to us, may be affected by circumstances and economic events outside of our control. In the event that a refinancing does not occur before the May 2025 maturity date of the 6.875% Notes, the Company believes that its projected cash on hand, availability under the Credit Facility, and its commercial paper program will enable the Company to repay the 6.875% Notes.

Previous wording

In the future, the Company may, from time to time, redeem portions of its debt securities or repurchase portions of its debt or equity securities in either the open market or through privately negotiated transactions, in accordance with applicable SEC and other legal requirements. The timing, prices, and sizes of purchases depend upon prevailing trading prices, general economic and market conditions, and other factors, including applicable securities laws. Such purchases may be completed by means of trading plans established from time to time in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, block trades, private transactions, open market repurchases, tender offers, and/or accelerated share repurchase agreements or other derivative transactions.

Current wording

In the future, the Company may, from time to time, redeem portions of its debt securities or repurchase portions of its debt or equity securities, including but not limited to the 6.875% Notes, in either the open market or through privately negotiated transactions, in accordance with applicable SEC and other legal requirements. The timing, prices, and sizes of purchases depend upon prevailing trading prices, general economic and market conditions, and other factors, including applicable securities laws. Such purchases may be completed by means of trading plans established from time to time in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, block trades, private transactions, open market repurchases, tender offers, and/or accelerated share repurchase agreements or other derivative transactions.

Previous wording

On December 15, 2023, S&P upgraded Howmet’s long-term debt rating at BBB- and updated the current outlook from positive to stable, citing strong demand in the commercial aerospace market and the Company’s improved financial leverage.

Current wording

On December 15, 2023, S&P upgraded Howmet’s long-term debt rating to BBB- and updated the current outlook from positive to stable, citing strong demand in the commercial aerospace market and the Company’s improved financial leverage.

Previous wording

Cash used for investing activities was $75 in the three months ended March 31, 2024 compared to $64 in the three months ended March 31, 2023. The increase of $11, or 17%, was primarily due to an increase in capital expenditures of $18 primarily related to capacity expansion projects in Engine Products and Forged Wheels and various automation projects, partially offset by proceeds from the sale of assets at a small U.K. manufacturing facility in Engines Products of $7.

Current wording

Cash used for investing activities was $129 in the six months ended June 30, 2024 compared to $105 in the six months ended June 30, 2023. The increase of $24, or 23%, was primarily due to an increase in capital expenditures of $32 primarily related to capacity expansion projects in Engine Products and Forged Wheels and various automation projects, partially offset by proceeds primarily from the sale of assets at a small U.K. manufacturing facility in Engine Products of $8.

Previous wording

This report contains (and oral communications made by Howmet may contain) statements that relate to future events and expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those containing such words as “anticipates”, “believes”, “could”, “estimates”, “expects”, “forecasts”, “goal”, “guidance”, “intends”, “may”, “outlook”, “plans”, “projects”, “seeks”, “sees”, “should”, “targets”, “will”, “would”, or other words of similar meaning. All statements that reflect Howmet’s expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, statements, forecasts and outlook relating to the condition of end markets; future financial results or operating performance; future strategic actions; Howmet’s strategies, outlook, and business and financial prospects; and any future debt redemptions or repurchases of its debt or equity securities. These statements reflect beliefs and assumptions that are based on Howmet’s perception of historical trends, current conditions and expected future developments, as well as other factors Howmet believes are appropriate in the circumstances. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict, which could cause actual results to differ materially from those indicated by these statements. Such risks and uncertainties include, but are not limited to: (a) deterioration in global economic and financial market conditions generally; (b) unfavorable changes in the markets served by Howmet; (c) the impact of potential cyber attacks and information technology or data security breaches; (d) the loss of significant customers or adverse changes in customers’ business or financial conditions; (e) manufacturing difficulties or other issues that impact product performance, quality or safety; (f) inability of suppliers to meet obligations due to supply chain disruptions or otherwise; (g) failure to attract and retain a qualified workforce and key personnel, labor disputes or other employee relations issues; (h) the inability to achieve revenue growth, cash generation, restructuring plans, cost reductions, improvement in profitability, or strengthening of competitiveness and operations anticipated or targeted; (i) inability to meet increased demand, production targets or commitments; (j) competition from new product offerings, disruptive technologies or other developments; (k) geopolitical, economic, and regulatory risks relating to Howmet’s global operations, including geopolitical and diplomatic tensions, instabilities, conflicts and wars, as well as compliance with U.S. and foreign trade and tax laws, sanctions, embargoes and other regulations; (l) the outcome of contingencies, including legal proceedings, go…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This report contains (and oral communications made by Howmet may contain) statements that relate to future events and expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those containing such words as “anticipates”, “believes”, “could”, “estimates”, “expects”, “forecasts”, “goal”, “guidance”, “intends”, “may”, “outlook”, “plans”, “projects”, “seeks”, “sees”, “should”, “targets”, “will”, “would”, or other words of similar meaning. All statements that reflect Howmet’s expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, statements, forecasts and outlook relating to the condition of end markets; future financial results or operating performance; future strategic actions; Howmet’s strategies, outlook, and business and financial prospects; and any future dividends, debt issuances, debt reduction and repurchases of its common stock. These statements reflect beliefs and assumptions that are based on Howmet’s perception of historical trends, current conditions and expected future developments, as well as other factors Howmet believes are appropriate in the circumstances. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict, which could cause actual results to differ materially from those indicated by these statements. Such risks and uncertainties include, but are not limited to: (a) deterioration in global economic and financial market conditions generally; (b) adverse changes in the markets served by Howmet; (c) the impact of potential cyber attacks and information technology or data security breaches; (d) the loss of significant customers or adverse changes in customers’ business or financial conditions; (e) manufacturing difficulties or other issues that impact product performance, quality or safety; (f) inability of suppliers to meet obligations due to supply chain disruptions or otherwise; (g) failure to attract and retain a qualified workforce and key personnel, labor disputes or other employee relations issues; (h) the inability to achieve anticipated or targeted revenue growth, cash generation, restructuring plans, cost reductions, improvement in profitability, or strengthening of competitiveness and operations; (i) inability to meet increased demand, production targets or commitments; (j) competition from new product offerings, disruptive technologies or other developments; (k) geopolitical, economic, and regulatory risks relating to Howmet’s global operations, including geopolitical and diplomatic tensions, instabilities, conflicts and wars, as well as compliance with U.S. and foreign trade and tax laws, sanctions, embargoes and other regulations; (l) the outcome of contingencies, including legal procee…

Excerpt shortened here; the source contains the full paragraph.