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This excerpt taken from the SPR 10-K filed Mar 5, 2007. Customers
Our primary customers are aircraft OEMs. Boeing and Airbus are
our two largest customers, and we are the largest independent
aerostructures supplier to both companies. We entered into
long-term supply agreements with our customers to provide
aerostructure products to aircraft programs. Currently,
virtually all of the products we sell are under long-term
contracts with 99% of those products, as measured by dollar
value of product sold, supplied by us on a sole-sourced basis.
We have good relationships with our customers due to our diverse
product offering, leading design and manufacturing capabilities
using both metallic and composite materials, and competitive
pricing.
Boeing. For the twelve months ended
December 31, 2006, approximately 91% of our revenues were
from sales to Boeing. We have a strong relationship with Boeing
given our 75 + year history as a Boeing division. Many members
of our senior management team are former Boeing executives who
have strong embedded relationships with Boeing and continue to
work closely with Boeing. As part of the Boeing Acquisition, we
entered into a long-term supply agreement under which we are
Boeing’s exclusive supplier for substantially all of the
products and services provided by Boeing Wichita prior to the
Boeing Acquisition for the life of the programs. In addition,
Boeing selected us to be the design leader for the Boeing B787
forward fuselage based in part on our strong expertise with
composite technologies.
We believe our strong relationship with Boeing is unmatched in
the industry and will allow us to continue to be an integral
partner with Boeing in the designing, engineering and
manufacturing of complex aerostructures.
Table of Contents
Airbus. For the twelve months ended
December 31, 2006, approximately 8% of our combined
revenues were from sales to Airbus. As a result of the BAE
Acquisition, we have become the largest independent
aerostructures supplier to Airbus. Under our supply agreements
with Airbus, we supply most of our products for the life of the
aircraft program, including commercial derivative models, with
pricing determined through 2010. For the A380, we have a
long-term supply contract with Airbus that covers a fixed number
of units. We believe we can leverage our relationship with
Airbus and history of delivering high quality products to
further increase our sales to Airbus and continue to partner
with Airbus on new programs going forward.
Although most of our revenues are obtained from sales inside the
U.S., we generated $254.1 million in sales to international
customers for the twelve months ended December 31, 2006,
primarily to Airbus. This includes nine months of revenue since
our acquisition of BAE Aerostructures. The following chart
illustrates the split between domestic and foreign sales:
The international revenue is included primarily in the Wing
Systems segment. All other segment revenues are from
U.S. sales. Approximately 11.7% of our total assets based
on book value are located in the United Kingdom as part of
Spirit Europe with less than 1 percent of the remaining
assets located in other countries outside the United States.
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