Slide 1: 4Q and Full Year 2012 Earnings Conference Call
4Q and Full Year 2012 Earnings Conference Call February 21, 2013 Fourth Quarter 2012
Slide 2: Safe Harbor Statement
Safe Harbor Statement Please note that the information provided in this presentation is accurate as of the date of the original presentation. The presentation will remain posted on this web site from one to twelve months following the initial presentation, but content will not be updated to reflect
Slide 3: Overview of 2012 Results
Overview of 2012 Results • Sales increased 4%, benefiting from acquisitions and growth in commercial markets • Continue to experience strong growth in Commercial Aerospace OEM business • Uncertainty in defense spending leading to softness in all of our defense markets • Adjusted operating income inc
Slide 4: 2012 End Markets Summary - Defense
2012 End Markets Summary Defense Key Positives • Higher CVN-79 aircraft carrier revenues for pumps Aero and valves Defense Oil & Gas • Increased sales on military helicopters (particularly 15% 12% Black Hawk and Stallion) Ground • Higher thermal spray coatings sales in aerospace Defense defense 5% •
Slide 5: 2012 End Markets Summary - Commercial
2012 End Markets Summary Commercial Key Positives • Commercial growth led by ongoing ramp up in Oil & Gas Aero commercial aircraft production rates 12% Defense 15% • Solid U.S. AP1000 revenues and strong demand on domestic nuclear operating reactors Ground Defense • Benefit from lower cost estimates
Slide 6: 2013E Financial Outlook
2013E Financial Outlook (as of February 20, 2013) Management Guidance FY2012A FY2013E Total Sales $2,098M $2,480 - 2,520M Flow Control $1,095M $1,300 - 1,320M Controls $727M $865 - 875M Surface Technologies $276M $315 - 325M Operating Income $161M $229 - 237M CW Margin 7.7% 9.2% - 9.4% Flow Control
Slide 7: Pro Forma EPS Growth – 2012A vs. 2013E
Pro Forma EPS Growth – 2012A vs. 2013E (as of February 20, 2013) $3.00 $0.20 - $0.26 $2.70 - $2.80 $0.58 $0.23 - $0.27 $2.50 ($0.15 ) ($0.11) $1.95 $2.00 $1.50 $1.00 $0.50 $0.00 2012A Reported One-time items in One-time items in Pension Increase Acquisition Organic 2013E Pro Forma 2012 2013 Improvem
Slide 8: 2013E Financial Outlook
2013E Financial Outlook (as of February 20, 2013) Management Guidance FY2012A FY2013E Operating Income $161M $229 - 237M Pension Expense $27M $33 - 34M Interest Expense $26M $39 - 40M Diluted EPS $1.95 $2.70 - 2.80 Diluted Shares Outstanding 47.4M 47.6M Effective Tax Rate 31.8% 32.0% Free Cash Flow
Slide 9: Acquisition Rationale
Acquisition Rationale • Focused on acquiring niche, high-technology companies with industry leading capabilities and profitable growth • Seeking acquisitions that can provide: • Market diversification and balance • Expansion of geographic footprint • Breadth of technologies, products and services •
Slide 10: Evolving Market Exposure
Evolving Market Exposure Pre-4Q Acquisitions (1) 2012 Reported 37% Defense 12% Oil & Gas $2,077 M (1) Industrial 21% 13% Power Gen 17% (1) Excludes approximately $21 million in 2012 sales related to recent acquisitions Comm Aero Geographic Diversification ● Balanced Market Offering Fourth Quarter 20
Slide 11: Evolving Market Exposure - AP Services
Evolving Market Exposure - AP Services Primary markets served: Power Generation, General Industrial Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 11
Slide 12: Evolving Market Exposure - PG Drives
Evolving Market Exposure - PG Drives Primary market served: General Industrial Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 12
Slide 13: Evolving Market Exposure - Williams Controls
Evolving Market Exposure - Williams Controls Primary market served: General Industrial Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 13
Slide 14: Evolving Market Exposure - Exlar
Evolving Market Exposure - Exlar Primary markets served: General Industrial, Defense Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 14
Slide 15: Evolving Market Exposure - Gartner
Evolving Market Exposure - Gartner Primary markets served: Oil & Gas, Power Generation, General Industrial Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 15
Slide 16: Evolving Market Exposure - Cimarron
Evolving Market Exposure - Cimarron Primary market served: Oil & Gas Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 16
Slide 17: Evolving Market Exposure - Phonix
Evolving Market Exposure - Phonix Primary markets served: Oil & Gas, Power Generation, General Industrial Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 17
Slide 18: Evolving Market Exposure (2013E with Acquisitions)
Evolving Market Exposure (2013E Guidance as of February 20, 2013) 2013E with Acquisitions 30% Defense 18% $2,480 - Oil & Gas 2,520 M 18% Industrial Power Gen 18% 16% Comm Aero Geographic Diversification ● Balanced Market Offering Fourth Quarter 2012 18
Slide 19: 2013E Market Outlook
2013E Market Outlook (as of February 20, 2013) Management Guidance FY2013E Aero Defense (9) - (13%) Ground Defense (15) - (19%) Naval Defense 7 - 11% Total Defense Flat to Down 4% Including Other Defense Commercial Aero 7 - 11% Oil & Gas 70 - 74% Power Generation 3 - 7% General Industrial 66 - 70% T
Slide 20: Outlook for 2013 and Closing Comments
Outlook for 2013 and Closing Comments • Curtiss-Wright positioned for solid future growth organically and through strategic acquisitions • Solid performances anticipated in all commercial markets • Mixed performance in defense, with solid rebound in naval sales despite continued uncertainty impactin
Slide 21: Appendix
Appendix 21 Fourth Quarter 2012
Slide 22: Non-GAAP Reconciliation
Non-GAAP Reconciliation 22 Fourth Quarter 2012
Slide 23: 2012 Segment Review – Flow Control
2012 Segment Review – Flow Control Oil & Gas Naval 22% Defense 28% Gen Industrial 9% Power Gen Comm Aero 38% 3% Segment Sales: $1.1 B 23 Fourth Quarter 2012
Slide 24: 2012 Segment Review – Controls
2012 Segment Review – Controls Comm Aero 31% Aero Defense 37% Gen Industrial 10% Other Ground Defense & Defense Naval Gov't. 15% Defense 3% 4% Segment Sales: $727 M 24 Fourth Quarter 2012
Slide 25: 2012 Segment Review – Surface Technologies
2012 Segment Review – Surface Technologies Comm Aero 41% Gen Industrial 33% Power Gen Other Aero Defense 8% Defense & 13% Gov't. 1% Oil & Gas 4% Segment Sales: $276 M 25 Fourth Quarter 2012