Slide 1: Second Quarter 2021 Results Conference Call
S e c o n d Q u a r te r 2 0 2 1 Re s u l t s C o n fe re n c e C a l l
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements This presentation contains statements that, to the extent they are not recitations of historical fact, constitute "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchang
Slide 3: Executive Summary
EXECUTIVE SUMMARY Second Quarter 2021 Business Transformation Update Second Quarter 2021 Highlights Revenue Diversification Progress in All Business Segments Generated Y/Y Growth in Revenue, Adj. Net Income & Adj. EBITDA • Aviation: Organic/inorganic investments supporting Commercial and Business &
Slide 4: Global Parts Group Acquisition
GLOBAL PARTS GROUP ACQUISITION Acquired for $38 million on July 26, 2021 Acquisition Overview Global Parts Group, Inc. • Global Parts is a fully integrated aftermarket distribution and MRO services provider serving a diverse base of more than 3,000 Business & General Aviation (B&GA) customers • Glob
Slide 5: VSE Financial Summary
VSE FINANCIAL SUMMARY Quarter-to-Date Year-to-Date • 2Q’21 revenue of $175M ($ in millions except EPS) increased 18% y/y(1) 2Q'21 2Q'20 1Q'21 vs vs YTD '21 YTD '20 vs 2Q'20 1Q'21 YTD '20 • Sequential Q/Q revenue growth Revenue $175.1 $168.7 $165.0 4% 6% $340.1 $346.1 (2)% across all business segment
Slide 6: Consolidated Performance Bridge
CONSOLIDATED PERFORMANCE BRIDGE Q/Q Comparisons: Revenue Adj. EBITDA Adj. EBITDA Margin % • Aviation segment revenue and profit increased, with four quarters of sequential growth supported by both market share gains and aviation recovery, specifically 1Q'21 $165.0 $15.6 9.5% in the business and gene
Slide 7: Aviation Segment
AVIATION SEGMENT 2Q'21 vs vs YTD '21 vs ($ in millions) 2Q'20 1Q'21 YTD '20 • 2Q’21 revenue increased +52% versus same Revenue $47.5 +47 % +7 % $91.9 +2% period of 2020, excluding the contribution of Adjusted Revenue (1) $47.5 +52 % +7 % $91.9 +13% CT Aerospace divestiture Adjusted EBITDA $4.0 +240
Slide 8: Fleet Segment
FLEET SEGMENT vs vs vs • 2Q’21 revenue increased +12% versus same 2Q'21 2Q'20 1Q'21 YTD '21 YTD '20 ($ in millions) period of 2020, excluding the 2020 non- Revenue $58.1 (18)% 6% $112.8 (9)% recurring PPE order revenue, supported by Commercial fleet growth, specifically Adjusted EBITDA $7.0 (27)% (1
Slide 9: Federal & Defense Segment
FEDERAL & DEFENSE SEGMENT 2Q'21 vs vs YTD '21 vs 2Q'20 1Q'21 YTD '20 • Y/Y revenue increases supported by HAECO ($ in millions) Special Services (HSS) acquisition and Revenue $69.5 7% 6% $135.4 +3% increased market penetration with existing Adjusted EBITDA $8.1 8% 41 % $13.9 +5% customers; +7% y/y A
Slide 10: Balance Sheet Optionality
BALANCE SHEET OPTIONALITY ($ in millions) 2Q'21 2Q'20 1Q'21 Net Debt $275 $260 $253 Free Cash Flow $(20.6) $14.9 $(38.5) Net leverage ratio 3.9x 3.0x 3.7x Unused Commitments $140 $184 $167 • July 2021: Amended and extended existing debt agreement(s) with existing bank group • Extended loan maturity
Slide 11: Appendix
Yes APPENDIX CORPORATION
Slide 12: GAAP to Non-GAAP Reconciliations: Adjusted Net Income and EPS
GAAP TO NON-GAAP RECONCILIATIONS Adjusted Net Income and Adjusted EPS (Diluted) In thousands (except per share data) 1Q2020 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Net income (loss) $ 3,332 $ (22,624) $ 8,108 $ 6,013 $ 5,111 $ (12,366) Adjustments to Net income (loss): Acquisition related costs — — — — 3
Slide 13: GAAP to Non-GAAP Reconciliations: EBITDA and Adjusted EBITDA
GAAP TO NON-GAAP RECONCILIATIONS EBITDA and Adjusted EBITDA In thousands (except per share data) 1Q2020 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Net income (loss) $ 3,332 $ (22,624) $ 8,108 $ 6,013 $ 5,111 $ (12,366) Interest expense, net 3,486 3,072 3,530 3,408 3,030 2,666 Income taxes 2,916 (2,358) 2,54
Slide 14: GAAP to Non-GAAP Reconciliations: Segment EBITDA
GAAP TO NON-GAAP RECONCILIATIONS Segment EBITDA and Adjusted EBITDA In thousands 1Q2020 2Q2020 3Q2020 4Q2020 1Q2021 2Q2021 Aviation Operating income (loss) $ (1,880) $ (34,387) $ 1,586 $ (833) $ (332) $ (22,272) Depreciation and amortization 3,066 2,472 2,493 2,667 2,554 2,554 EBITDA 1,186 (31,915)
Slide 15: GAAP to Non-GAAP Reconciliations: Balance Sheet
GAAP TO NON-GAAP RECONCILIATIONS Balance Sheet Reconciliation of Operating Cash Flow to Free Cash Flows Three Months Ended In thousands 31-Mar-20 30-Jun-20 30-Sep-20 31-Dec-20 31-Mar-21 31-Jun-21 Net cash (used in) provided by operating activities $ 6,758 $ 16,050 $ 12,427 $ 526 $ (36,367) $ (17,601