As Hexcel Corp. fights a proxy battle against financiers who claim its margins fall well short of composite-industry competitors, the Stamford-based company”™s revenue leaped 22 percent from a year ago on strong sales to commercial aerospace manufacturers and a weakening dollar.
Hexcel had a $23 million profit on $345 million in revenue, and expressed confidence in its outlook despite delays on Boeing Co.”™s 787 passenger jet under development.
“Despite the recent negative news about U.S. airline profitability and the economy in general, Airbus and Boeing continue to expand their huge backlog,” said David Berges, CEO of Hexcel, in a prepared statement.
To support expected demand for carbon fiber, Berges was in Illescas, Spain, last week at the official opening of a new Hexcel factory there to produce the material.
Hexcel is currently engaged in a proxy battle with OSS Capital Management L.P. of New York City, which initially acquired shares in August 2005 and which recently upped that stake to 5 percent of all Hexcel shares.
OSS is staking its argument to the operating margins achieved by Hexcel competitors: West Paterson, N.J.-based Cytec Industries Inc. and Japan-based Toray Industries Inc.
Hexcel last week released supporting statements from Risk Metrics Group and Glass Lewis & Co. Both companies specialize in researching proxy proposals.
OSS Capital immediately reemphasized its position.
“The fact of the matter is that Hexcel is competing directly with Cytec and Toray for composite business at Boeing and Airbus,” said Oscar Schafer, managing general partner, in written comments. “By not moving quickly to close this gap, Hexcel runs the very real risk of becoming a second tier player in the composite industry.”
