Howmet Aerospace's **high cash and cash equivalents** in Q2 2024 were primarily driven by **robust operating cash flows** and a **record free cash flow of $342 million**. The company generated significantly more cash from operations (an increase of **$322 million** over the prior period) due to stronger operating results and more efficient working capital management. Additionally, efficient debt management and strategic allocation of funds—despite outlays for share repurchases, dividends, and capital expenditures—further contributed to maintaining a high cash balance.  **[0000004281-24-000026_hwm-20240630.htm:35]** **[HWM_3395016_2]** **[0001104659-24-083733_tm2420377d1_ex99-1.htm:1]** **[HWM_3395016_1]** **[0001104659-24-083733_tm2420377d1_ex99-1.htm:9]** 

Why was Cash and cash equivalents so high in Q2 2024?

The spike in **Long-term debt due within one year** in Q2 2024 was driven by the reclassification of a portion of the company’s long-term debt to current liabilities as they approached maturity. This reclassification specifically included the **5.125% Notes due October 2024**, which, having been partially redeemed in earlier periods, were now classified as due within one year.  **[0000004281-24-000026_hwm-20240630.htm:2]** **[0000004281-24-000026_hwm-20240630.htm:17]** **[0001104659-24-083733_tm2420377d1_ex99-1.htm:1]** 

What caused the spike in Long-term debt due within one year in Q2 2024?

The decrease in **long-term debt, less the current portion**, in Q2 2024 was primarily driven by two factors. First, the company completed the **early redemption of its 5.125% Notes**, reducing the remaining principal by **$205 million** and retiring the associated debt, which contributed significantly to the overall drop. Second, the company undertook a **repurchase of its 6.875% Notes** through an open market repurchase, further lowering its outstanding long-term debt. These actions combined led to the observed reduction in debt for Q2 2024.  **[0000004281-24-000026_hwm-20240630.htm:15]** 

Why did long-term debt, less the current portion, drop in Q2 2024?

The decrease in **Total Liabilities** in FY 2024 was driven primarily by several factors. First, there was a significant **reduction in long-term debt** (notably, early redemptions of the **6.875% Notes due 2025** and **5.125% Notes due 2024**, along with a partial prepayment of the USD Term Loan) which led to a decrease of **$391 million**. Additionally, **accrued pension and other postretirement benefits** declined by **$39 million** and **$38 million**, respectively. There was also a notable **reduction in current liabilities** (especially a drop in long-term debt due within one year from **$206 million to $6 million**). These reductions were partly offset by an increase in other noncurrent liabilities, but the overall effect was a decrease of **$426 million** in total liabilities for FY 2024.  **[0000004281-25-000011_hwm-20241231.htm:77]** **[0000004281-25-000011_hwm-20241231.htm:115]** 

What led to the decrease in Total liabilities in FY 2024?

cae4eb4e0a44211966c0726c2bda17d27412e6c8c6126a15c6539a618c52ef4e

Operating cash flow was low in Q1 2023 primarily due to **higher working capital requirements**, which negatively impacted cash flow by **$55 million**. This decrease was driven by unfavorable changes, including **$135 million** in accounts payable and **$14 million** in receivables, which were only partially offset by favorable changes in inventories, accrued expenses, taxes, and prepaid expenses. Additionally, modest positive contributions from **higher operating results** (+**$13 million**) and **lower payments on noncurrent liabilities** (+**$5 million**) were not sufficient to counterbalance the significant negative impact from working capital changes.  **[0000004281-23-000008_hwm-20230331.htm:29]** 

Why was Operating Cash Flow so low in Q1 2023?

The strong operating cash flow in FY 2023 was driven primarily by **higher operating results** (an improvement of **$303 million**), accompanied by **lower payments on noncurrent liabilities** (a decrease of **$26 million**) and **lower pension contributions** (a reduction of **$7 million**). Although **higher working capital requirements** partially offset these gains, the overall impact was a significant increase in cash provided from operations, bolstering the company's strong performance in FY 2023.  **[0000004281-24-000007_hwm-20231231.htm:55]** 

What factors contributed to the strong Operating Cash Flow in FY 2023?

267c3091a99baf72e88f60c76f46f1cba6f0130d4c2d23ef1fe7c7df0dacbf1c

The jump in **Earnings per Share Basic** to **0.59** in Q1 2024 is primarily driven by a combination of significantly higher **net income** (increasing from **$148 million in Q1 2023** to **$243 million in Q1 2024**) and robust **revenue growth** (with a 14% increase overall, including a 23% rise in the commercial aerospace market).  **[0001104659-24-055980_tm2413242d1_ex99-1.htm:0]** **[0000004281-24-000014_hwm-20240331.htm:24]**  Additionally, **improved margins** (with an adjusted EBITDA margin improvement of 150 basis points to 24.0%), strategic **share repurchases** that reduced the share count from 418 million to 412 million, lower **interest expense** (an $8 million reduction), and a significantly lower **tax rate** (falling from 32.7% to 19.8%) together contributed to the enhanced EPS.  **[HWM_3382113_1]** **[0001104659-24-055980_tm2413242d1_ex99-1.htm:0]** **[0000004281-24-000014_hwm-20240331.htm:10]** **[0001104659-24-055980_tm2413242d1_ex99-1.htm:1]** **[0000004281-24-000014_hwm-20240331.htm:23]** **[0000004281-24-000014_hwm-20240331.htm:24]** 

Why did Earnings per share Basic jump to 0.59 in Q1 2024?

The significant increase in net income in Q1 2024 was driven by **higher volumes** in both the commercial aerospace and defense aerospace markets, **favorable product pricing**, and a **reduction in interest expense** due to lower long-term debt levels.  **[0000004281-24-000014_hwm-20240331.htm:24]** 

What drove the significant increase in Net income in Q1 2024?

In Q4 2024, **Howmet Aerospace's** higher Operating Income was driven by several key factors. **Revenue growth** played a significant role, with the company's revenue increasing to **$1.9 billion**, up **9% year over year**—a boost primarily fueled by a **13% growth in the commercial aerospace market**.  **[0001104659-25-012529_tm256423d1_ex99-1.htm:1]** **[0001104659-25-012529_tm256423d1_ex99-1.htm:0]**  Additionally, there was an **improvement in the Operating Income Margin**, rising by approximately **470 basis points** to reach **23.5%**.  **[0001104659-25-012529_tm256423d1_ex99-1.htm:1]** **[0001104659-25-012529_tm256423d1_ex99-1.htm:0]**  Lastly, the exclusion of special items contributed to the performance, with the **Adjusted Operating Income** (excluding special items) reaching **$434 million**, marking a **32% year-over-year increase**.  **[0001104659-25-012529_tm256423d1_ex99-1.htm:1]** **[0001104659-25-012529_tm256423d1_ex99-1.htm:16]** 

What factors contributed to the higher Operating income in Q4 2024?

The negative charge in **Q3 2024** is due to the net impact of several factors. **Howmet Aerospace** recorded a **$1 million gain** from resolving post-closing adjustment issues related to the sale of a small U.K. manufacturing facility, along with a **$1 million reversal** of a layoff reserve from a prior period. These gains were partially offset by a **$1 million charge** for layoff costs. This combination resulted in a net negative restructuring and other charge for the period.  **[0000004281-24-000034_hwm-20240930.htm:9]** **[0000004281-24-000034_hwm-20240930.htm:27]** 

Why were Restructuring and other charges negative in Q3 2024?

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Taxes paid for net share settlement of equity awards (USD, millions)

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Net change in cash, cash equivalents and restricted cash (USD, millions)

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Cash, cash equivalents and restricted cash at end of year (USD, millions)

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Earnings per share Diluted (USD)

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EPS - Diluted [USD]

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Net headcount added in Engine Products (employees)

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Number of employees separated (total) (employees)

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Howmet Aerospace (HWM)

Financials