Curtiss-wright Corporation · NYSE:CW
Curtiss-wright — Q1 2020 Earnings Presentation
17 slides from Curtiss-wright's earnings presentation, May 7, 2020
Slide 1: 1Q 2020 Earnings Conference Call
1Q 2020 Earnings Conference CallMay 7, 2020 NYSE: CW
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 website from one to twelve months following the initial presentation, but content will not be updated to reflect n
Slide 3: Agenda
Agenda Operational Status and Response to COVID-19Highlights of Q1 2020 Performance CFO Transition2020 Financial Outlook and AssumptionsCapital Structure and Liquidity Management’s Actions Taken to Offset COVID-19 Impact
Slide 4: Curtiss-Wright's Response to COVID-19
Curtiss-Wright’s Response to COVID-19 Primary focus: Employee health and safetyContinue to advise global workforce to follow CDC guidelinesEnacted protocols across all sites regarding safety, cleaning and visitors Strong IT focus on enabling greater work from home/ remote capabilities; Enhanced secu
Slide 5: Solid First Quarter 2020 Performance
Solid First Quarter 2020 Performance Net Sales of $601 million, up 4% Strong growth in defense markets, up 26%, led by aerospace and naval defense marketsPartially offset by lower power generation and general industrial revenuesAdjusted Operating Income up 10%; Adjusted Operating Margin of 13.3%, up
Slide 6: First Quarter 2020 End Market Sales Growth
First Quarter 2020 End Market Sales Growth Notes: Percentages in chart relate to First Quarter 2020 sales compared with the prior year. Amounts may not add due to rounding.Any references to organic growth exclude the effects of foreign currency translation, acquisitions and divestitures, unless othe
Slide 7: First Quarter 2020 Adjusted Operating Income / Margin Drivers
First Quarter 2020 Adjusted Operating Income / Margin Drivers ($ in millions) 1Q’20 Adjusted(1) 1Q’19 Adjusted(1) Change vs. 1Q’19 Key Drivers Commercial / IndustrialMargin $36.0 13.6% $35.2 13.0% 2% 60 bps Higher sales and favorable mix for actuation productsPartially offset by lower sales and unfa
Slide 8: 2020 Financial Outlook and Assumptions
2020 Financial Outlook and Assumptions Sales PROFITABILITY Defense Markets: Expect organic growth led by naval defenseStrong DoD support for submarines and aircraft carriers; Stable order activityCommercial Markets: Expect growth to be challenging, primarily in the commercial aerospace and general i
Slide 9: Strong Balance Sheet and Liquidity
Strong Balance Sheet and Liquidity (at March 31, 2020) Cash balance: $158MAdjusted Debt: $896M$750M private placement and $146M drawn from revolver$100M in notes maturing in next three years (2021)Revolver: $500M (Current Capacity $324M)Plus $200M accordion feature Maturing in 2023Borrowing Capacity
Slide 10: Actions Taken to Offset COVID-19 Impact on 2020 Results
Actions Taken to Offset COVID-19 Impact on 2020 Results Implementing mitigation plans to protect ProfitabilityReducing discretionary spendEmployee furloughs (including Executive Leadership team)Reductions in forceLower incentive compensationSlowing pace of R&D investments slightly (still expect to e
Slide 11: 2020 Summary and Expectations
2020 Summary and Expectations Expect solid revenue growth in Defense; Commercial market outlook impacted by pace of economic rebound/recoveryRecent acquisitions providing modest boost to top-lineExpect Q2 to be weakest for sales and operating incomeAgile business model helps mitigate impact of reduc
Slide 12: Appendix: Non-GAAP Financial Results
Appendix Non-GAAP Financial Results The company reports its financial performance in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This press release refers to "Adjusted" amounts, which are Non-GAAP financial measures described below. We utilize a
Slide 13: Non-GAAP Reconciliations – 1Q 2020 Results
Non-GAAP Reconciliations – 1Q 2020 Results (In millions, except EPS) 1Q-2020 1Q-2019 Change Sales $ 601.2 $ 578.3 4% Reported operating income (GAAP) $ 72.4 $ 72.0 1% Adjustments (1) 7.6 0.5 - Adjusted operating income (Non-GAAP) $ 80.0 $ 72.5 10% Adjusted operating margin (Non-GAAP) 13.3% 12.5% 80
Slide 14: Non-GAAP Reconciliation – Organic Results
Non-GAAP Reconciliation – Organic Results Organic Sales and Organic Operating IncomeThe Corporation discloses organic sales and organic operating income because the Corporation believes it provides investors with insight as to the Company’s ongoing business performance. Organic sales and organic ope
Slide 15: Non-GAAP Reconciliation – Adjusted Debt and Adjusted Net Debt
Non-GAAP Reconciliation – Adjusted Debt and Adjusted Net Debt Adjusted Debt and Adjusted Net DebtThe Corporation discloses Adjusted Debt and Adjusted Net Debt as it believes that these measures provide useful information regarding contractual amounts of borrowed capital to be repaid, net of cash ava
Slide 16: Non-GAAP Reconciliation – EBITDA
Non-GAAP Reconciliation – EBITDA EBITDAThe Corporation discloses EBITDA as it believes that this measure is useful in evaluating the Corporation’s operating performance. EBITDA is defined as net earnings before interest, income taxes, depreciation, and amortization for the trailing twelve month peri
Slide 17: Non-GAAP Reconciliation – Leverage Ratios
Non-GAAP Reconciliation – Leverage Ratios