Graham Corporation · NYSE:GHM
Graham — Q2 FY2022 Earnings Presentation
13 slides from Graham's earnings presentation, Oct 27, 2021
Slide 1: Graham Corporation Q2 FY2022 Teleconference
GRAHAM CORPORATION Q2 FY2022 TELECONFERENCE NYSE: GHM • October 27, 2021 Daniel J. Thoren, President and Chief Executive Officer Jeffrey F. Glajch, Vice President & Chief Financial Officer © 2021 Graham Corp.
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to risks, uncertainties and assumptions
Slide 3: Q2 FY22 Overview
Q2 FY22 Overview Revenue of $34.1 million up 22% year-over-year, driven by acquisition • Defense industry 58% of revenue in the quarter • Strategic expansion into defense business • Energy/Petrochem expected to recover over next twelve to 24 months Sequential order increase to $31.4 million Backlog
Slide 4: Q2 FY22: Results driven by Acquisition and Defense Industries
Q2 FY22: Results driven by Acquisition and Defense Industries ($ in millions, except per share data) Sales Adjusted EBITDA and Margin(1) $34.1 $28.0 $4.0 $0.1 14.2% 0.2% Q2 FY21 Q2 FY22 Q2 FY21 Q2 FY22 Gross Profit and Margin GAAP and Adjusted Diluted EPS(1) • Sales increased $6.1 million, or 22% ov
Slide 5: YTD FY22: Continue to Expect Growth for Full Year
YTD FY22: Continue to Expect Growth for Full Year ($ in millions, except per share data) Sales Adjusted EBITDA and Margin(1) $54.3 $44.7 $2.2 4.9% (5.2%) $(2.8) YTD FY21 YTD FY22 YTD FY21 YTD FY22 Gross Profit and Margin GAAP and Adjusted Diluted EPS(1) • Sales increased 22% over easy comparator per
Slide 6: Used Large Cash Reserves to Invest in Growth
Used Large Cash Reserves to Invest in Growth ($ in millions) CAPITALIZATION • Accretive acquisition expected to improve return on assets Sept. 30, March 31, - Put cash to work to grow the business 2021 2021 - Invested $41.1 million of cash for acquisition Cash and cash equivalents and investments $
Slide 7: Backlog Growth Driven by Defense
Backlog Growth Driven by Defense ($ in millions) Q2 FY22 TTM Orders $127.5 million Space 2% Orders $61.8 Other 11% $52.3 Chem/Petrochem 13% $35.0 $52.3 $31.4 $12.6 $20.9 Defense, 57% $12.4 $13.4 $2.4 $22.4 $5.4 $18.5 $19.0 Refining 17% $9.5 $8.0 Q2 FY21 Q3 FY21 Q4 FY21 Q1 FY22 Q2 FY22 Quarterly Net
Slide 8: Execution of Strategy: Evolving into Defense Business
Execution of Strategy: Evolving into Defense Business Acquisition of Barber-Nichols strengthening presence in Defense industry Strong Defense business helps offset challenges in other segments • Sales increased $12.7 million sequentially • Sequential orders up more than $10 million • Strong backlog
Slide 9: Graham Fiscal 2022 Guidance
(1) Graham Fiscal 2022 Guidance Revenue: $130 million to $140 million • 45% to 50% anticipated to be associated with the defense industry • Inclusive of BN’s 10-month revenue contribution expected to be between $45 million to $48 million • Expect improvement sequentially by quarter with fourth quart
Slide 10: Transforming to Drive Value
Transforming to Drive Value Leveraging transformational acquisition to accelerate More efficient balance sheet growth in defense industry with capacity for additional acquisitions and financial flexibility to Preparing for refining invest in organic growth and petrochem upcycle expansion Strong oper
Slide 11: Supplemental Information
SUPPLEMENTAL INFORMATION © 2021 Graham Corp.
Slide 12: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation (Unaudited, $ in thousands) Three Months Ended Six Months Ended September 30, September 30, 2021 2020 2021 2020 Net (loss) income $ (492) $ 2,744 $ (3,618) $ 926 Acquisition related inventory step-up expense 41 - 41 - Acquisition related costs 93 - 262 - Change in fair
Slide 13: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation (Unaudited, $ in thousands) Three Months Ended Six Months Ended September 30, September 30, 2021 2020 2021 2020 Net (loss) income $ (492) $ 2,744 $ (3,618) $ 926 Acquisition related inventory step-up expense 41 - 41 - Acquisition related costs 93 - 262 - Amortizati