SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
July 6, 1999 (July 1, 1999)
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Date of report (Date of earliest event reported)
Hexcel Corporation
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(Exact Name of Registrant as Specified in Charter)
Delaware 1-8472 94-1109521
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(State of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
Two Stamford Plaza
281 Tresser Boulevard
Stamford, Connecticut 06901-3238
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(Address of Principal Executive Offices and Zip Code)
(203) 969-0666
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(Registrant's telephone number, including area code)
N/A
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(Former Name or Former Address, if Changed Since Last Report)
Item 5 Other Events.
A copy of the press release issued by Hexcel Corporation, a
Delaware corporation (the "Company") on July 1, 1999 is filed as Exhibit
99.1 to this Current Report and is incorporated herein by reference.
Item 7 Financial Statements, Pro Forma
Financial Information and Exhibits.
(c) Exhibits
99.1 Press Release issued by the
Company on July 1, 1999.
Signatures
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
Dated: July 6, 1999
HEXCEL CORPORATION
By: /s/ Ira J. Krakower
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Name: Ira J. Krakower
Title: Senior Vice President,
General Counsel and
Secretary
EXHIBIT INDEX
Exhibit No. Description
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99.1 Press Release issued by the
Company on July 1, 1999
Exhibit 99.1
CONTACTS INVESTORS:
STEPHEN C. FORSYTH
203-969-0666 EXT. 425
[email protected]
MEDIA:
RONALD S. ZIEMBA
203-969-0666 EXT. 405
[email protected]
HEXCEL UPDATES 1999 SECOND QUARTER OUTLOOK
SALES AND ADJUSTED EPS WILL BE LOWER THAN EXPECTED; GENERATING
CASH FLOW TO REPAY DEBT
STAMFORD, CT, July 1, 1999 - Hexcel Corporation (NYSE/PCX: HXL) today
provided guidance on the performance of its business for the second quarter
of 1999.
"During May and June, sales demand in a number of the markets Hexcel serves
has been lower than anticipated," said John J. Lee, the company's chairman
and chief executive officer. "However, we are making good progress in our
goal to generate cash for debt repayment through better management of
working capital and capital expenditures."
Regarding sales, Mr. Lee said, "In commercial aerospace, we have begun to
experience the impact of inventory reductions and the forecast decrease in
Boeing's build rates. Sales of the company's carbon fiber products are also
being affected by the excess supply in the carbon fiber industry. While the
market for electronic fiber glass materials appears to be stabilizing,
sales of fabric products have been lower than anticipated for ballistic,
composite reinforcement and decorative applications."
As a result, Mr. Lee commented, Hexcel now expects net sales for the
quarter to be in the range of $290 to $300 million, with gross margins in
the range of 22% to 23% of net sales. This is expected to result in
Adjusted EBITDA (earnings before interest expense, taxes, depreciation,
amortization, equity in earnings of affiliated companies, and business
acquisition and consolidation expenses) for the quarter of between $41.5
and $43.5 million.
Mr. Lee noted that the company continues to generate cash to repay debt.
"Free cash flow in the second quarter will permit the repayment of between
$15 and $20 million of debt. We anticipate that we will continue to repay
debt over the balance of 1999," Mr. Lee said.
Commenting on earnings per share expectations, Mr. Lee said, "In light of
current market conditions we now believe that Adjusted Diluted EPS (diluted
earnings per share excluding business acquisition and consolidation
expenses) will be in a range of $0.13 to $0.16 per share for the second
quarter, and in a range of $0.60 to $0.70 per share for the year as a
whole."
"Hexcel is focused on improving performance and repaying debt by continuing
to reduce costs and improve productivity through our Lean Enterprise and
other initiatives," Mr. Lee said. "We are convinced that this is the right
emphasis to maintain and strengthen our position as the global leader in
advanced structural materials, and thereby enhance the value of our
shareholders' investment."
Hexcel expects to report the results of its second quarter of 1999 on the
evening of Tuesday, July 20, 1999.
Hexcel Corporation is the world's leading advanced structural materials
company. It develops, manufactures, and markets lightweight,
high-performance reinforcement products, composite materials and engineered
products for use in commercial aerospace, space and defense, electronics,
recreation and general industrial applications.
DISCLAIMER ON FORWARD LOOKING STATEMENTS
This press release contains statements that are forward looking, including
statements relating to market conditions, sales, gross margin percentage,
Adjusted EBITDA, and Adjusted Diluted EPS, cash generation, debt repayment,
and productivity improvements. These statements are not projections or
assured results. Actual results may differ materially from the results
anticipated in the forward looking statements due to a variety of factors,
including but not limited to, changing market conditions, increased
competition, product mix and currency. Additional risk factors are
described in the company's filings with the SEC. The company does not
undertake an obligation to update its forward looking statements to reflect
future events or circumstances.
