Mercury Systems Inc · NASDAQ:MRCY
Mercury Systems — Q1 2025 Earnings Presentation
16 slides from Mercury Systems's earnings presentation, Nov 5, 2024
Slide 1: First Quarter Fiscal Year 2025 Financial Results
FIRST QUARTER FISCAL YEAR 2025 FINANCIAL RESULTS Bill Ballhaus Chairman and CEO David Farnsworth Executive Vice President and CFO November 5, 2024, 5:00 pm ET WEBCAST LOGIN AT WWW.MRCY.COM/INVESTOR WEBCAST REPLAY AVAILABLE BY 7:00 P.M. ET NOVEMBER 5, 2024 1 © Mercury Systems, Inc.
Slide 2: Forward-looking safe harbor statement
Forward-looking safe harbor statement This presentation contains certain forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including those relating to the Company's focus on enhanced execution of the Company's strategic plan under a refreshe
Slide 3: Today's call
Today’s call ▪ Opening remarks on business and results ▪ Update on our four focus areas ▪ Expectations for performance for FY25 and beyond ▪ Q&A 3 © Mercury Systems, Inc. /Mercury Propriet ary /No Tech Data/
Slide 4: Business and results
Business and results ▪ Optimistic about our strategic positioning and expectations on delivering predictable organic growth with expanding margins and robust free cash flow. ▪ Q1 results generally as expected and reflect solid progress in each of our four priority focus areas. ▪ Improved execution a
Slide 5: Delivering predictable performance
Delivering predictable performance ▪ Focus on delivering predictable performance positively impacted results, primarily in three areas. ▪ Continued progress on mitigating what we believe to be predominantly transitory impacts. ▪ Continued progress in ramping toward full rate production in our Common
Slide 6: Driving organic growth
Driving organic growth ▪ Q1 bookings of $247.7 million resulted in record backlog of over $1.3 billion. ▪ In line with expectations, over 90% of Q1 bookings were production in nature. ▪ Secured several marquee wins in the quarter, reflecting customers’ continued trust in Mercury to support critical
Slide 7: Expanding margins
Expanding margins ▪ Remain focused on the following levers in our efforts to achieve targeted adjusted EBITDA margins in the low to mid 20% range: ‒ Executing on development programs and minimizing cost growth impacts. ‒ Getting back toward a more historical 20/80 mix of development to production pr
Slide 8: Driving improved free cash flow conversion and release
Driving improved free cash flow conversion and release ▪ Continued progress on drivers of free cash flow, in particular in reducing net working capital which is down 14.6% year-over-year. ▪ Inventory down $11.8 million year-over-year, with an increase in deferred revenue reflecting focus on improved
Slide 9: Expectations for FY25 and beyond
Expectations for FY25 and beyond ▪ Optimistic about our expected ability over time to deliver results in-line with our target profile. ▪ Continue to expect that revenue for the first half will be approximately in line with last year. ▪ Continue to expect FY25 revenue to be relatively flat year-over
Slide 10: Q1 FY25 vs. Q1 FY24
Q1 FY25 vs. Q1 FY24 Notes In $ millions, except percentage and per share data Q1 FY25(2) Q1 FY24(2) CHANGE (1) Non-GAAP, see reconciliation table. (2) Al l references in this presentation to t he first quarter Bookings $247.7 $191.5 of fiscal 2025 are to the quarter 29% ended September 27, 2024. All
Slide 11: Balance sheet
Balance sheet Notes As of (1) Rounded amounts used. (In $ millions)(1) 9/29/23 12/29/23 3/29/24 6/28/24 9/27/24 ASSETS Cash & cash equivalents $89.4 $168.6 $142.6 $180.5 $158.1 Accounts receivable and unbilled receivables, net 480.0 433.7 417.2 415.5 422.8 Inventory, net 363.0 354.2 343.0 335.3 351.
Slide 12: Cash flow summary
Cash flow summary Notes For the Fiscal Quarters Ended (1) Rounded amounts used. (2) Non-GAAP, see reconciliation table. (In $ millions)(1) 9/29/23 12/29/23 3/29/24 6/28/24 9/27/24 Net Loss ($36.7) ($45.6) ($44.6) ($10.8) ($17.5) Depreciation and amortization 22.7 22.2 21.8 21.4 21.2 Other non-cash i
Slide 13: Appendix
APPENDIX © Mercury Systems, Inc.
Slide 14: Adjusted EPS reconciliation
Adjusted EPS reconciliation Notes (1) Per share informat ion is presented on a ful ly diluted basis. (2) Rounded amounts used. (3) Impact to income taxes i s calculated by recasting income before income taxes to i ncl ude the items involv ed in determining adjusted income and recalculating the incom
Slide 15: Adjusted EBITDA reconciliation
Adjusted EBITDA reconciliation Notes (1) Rounded amounts used. (2) Al l references in this presentation to the first quarter of fiscal 2025 and LTM Q1 FY25 are to the quarter ended September 27, 2024, and the four-quarter period ended September 27, 2024. Al l references in this presentation to the f
Slide 16: Free cash flow reconciliation
Free cash flow reconciliation Notes (1) Rounded amounts used. 16 © Mercury Systems, Inc. /Mercury Propriet ary /No Tech Data/