Slide 1: Vectrus Second Quarter 2021 Results
VECTRUS SECOND QUARTER 2021 RESULTS CHUCK PROW – PRESIDENT AND CHIEF EXECUTIVE OFFICER SUSAN LYNCH – SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER AUGUST 10, 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement Page 2 SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 (THE “ACT"): CERTAIN MATERIAL PRESENTED HEREIN INCLUDES FORWARD-LOOKING STATEMENTS INTENDED TO QUALIFY FOR THE SAFE HARBOR FROM LIABILITY ESTABLISHED BY THE ACT. THESE FORWARD- LOOKING STATE
Slide 3: Q2'21 Results & Highlights
Page 3 1 See appendix for reconciliation of non-GAAP measures. 2 Pro forma Total Backlog includes protested awards. Q2’21 Results & Highlights Achieved strong operating performance in Q2’21 Revenue +40% y/y to $471 million, with strong organic growth of 21% Momentum driving strong sequential a
Slide 4: Strategic Framework Driving Performance
Strategic Framework Driving Performance Page 4 Market Leadership Traditional Market Converged Market Operational Technology Services Logistics IT ServicesFacilities Conv Growth & Capital Allocation Talent & Culture Development Enterprise Performance Improvement Strategy Organic Growth Program
Slide 5: Expanding in the Pacific
Expanding in the Pacific Page 5 Vectrus’ position in the Pacific region (INDOPACOM) is rapidly expanding and our capabilities in the region are aligned to support the mission requirements of our clients We expect additional growth in INDOPACOM given our position under LOGCAP V to support the Army th
Slide 6: Executing Growth through Client Campaigns
Executing Growth through Client Campaigns Page 6 Delivering on our strategy to diversify our client portfolio, win new business, and improve operational performance by aggressively leveraging technology Deliberate, campaign based, approach to growth in targeted clients: — Tailored attack plan wi
Slide 7: Track-Record of Successful M&A Execution and Integration
Track-Record of Successful M&A Execution and Integration Page 7 Formally executed inorganic strategy; acquired a pioneer in the Internet of Things with core competency in sensor integration and perimeter security solutions. Provided entry into the intelligence community. Expanded logistics capabilit
Slide 8: Pipeline Expansion Driving Positive Momentum
Page 8 Pipeline Expansion Driving Positive Momentum Steady proposal activity Solid expansion of opportunities across federal, non-federal, and international client sets Continued portfolio diversification and alignment to higher margin technology enabled solutions ($B) $ 6.0 $ 7.0 $ 7.7 $ 8.0
Slide 9: Q2'21 Financial Results
Page 9 1 See appendix for reconciliation of non-GAAP measures. 2 Definition of metric updated in Q1 2021 to add-back amortization of acquired intangible assets. Q2’21 Financial Results Revenue ($M) Operating Margin & Adj. EBITDA Margin1 Adj. Diluted EPS1,2 $336.1 $470.8 Q2'20 Q2'21 $0.31 $1.52 Q2'20
Slide 10: Q2'21 Revenue by Category
Page 10 Q2’21 Revenue by Category Customer Geographic Region Contract Type 1 2020 T&M immaterial and included in cost-type. 68% 23% 4% 5% Q2'20 Army Air Force Navy Other 63% 25% 11% 1% Q2'20 Middle East US Europe Asia 72% 28% Q2'20 Cost-type Fixed Price 1 73% 24% 3% Q2'21 Cost-type Fixed Price T&M 5
Slide 11: Solid Backlog and Book-to-Bill
Solid Backlog and Book-to-Bill Page 11 Total Q2’21 Pro Forma Backlog of $5.3 Billion Pro forma backlog includes contracts under protest ~$0.4B Pro forma backlog is ~3.0x the 2021 revenue mid- point, providing insight into future revenue and cash flow generation Backlog1 ($B) Trailing 12-Month Bo
Slide 12: Cash Flow and Liquidity
($M) 2020 2021 $ y/y change % y/y change YTD Net Cash Provided by (Used in) Operating Activities $34.4 $14.0 ($20.4) (59.3%) Cash $62.7 $69.8 $7.1 11.3% Receivables $260.3 $353.8 $93.5 35.9% Debt $67.5 $175.0 $107.5 159.3% Net Debt1 $4.8 $105.2 $100.4 NA Leverage Ratio (x) 1.08x 1.76x .68x 63.0% Pag
Slide 13: Increasing 2021 Revenue & EPS Guidance
Increasing 2021 Revenue & EPS Guidance 2021 guidance assumptions include: Capital expenditures ~ $7 million Depreciation and amortization ~ $17 million Amortization of acquired intangible assets ~$11 million Mandatory debt payments $8.6 million Interest expense ~ $8 million Tax rate of ~
Slide 14: Appendix
vy APPENDIX VECTRUS TRUE TO YOUR MISSION
Slide 15: Reconciliation Of Non-GAAP Measures
Reconciliation Of Non-GAAP Measures Page 15 The primary financial performance measures we use to manage our business and monitor results of operations are revenue trends and operating income trends. In addition, we consider adjusted operating income, adjusted operating margin, adjusted net income, a
Slide 16: Reconciliation Of Non-GAAP Measures
Reconciliation Of Non-GAAP Measures Page 16 Adjusted Net Income, Adjusted Diluted Earnings Per Share (Non-GAAP Measures) ($K, except per share data) Three Months Ended July 2, 2021 As Reported M&A Related Costs LOGCAP V Pre- Operational Legal Costs Amortization of acquired intangible assets Three Mo
Slide 17: Reconciliation Of Non-GAAP Measures
Reconciliation Of Non-GAAP Measures Page 17 Adjusted Net Income, Adjusted Diluted Earnings Per Share (Non-GAAP Measures) ($K, except per share data) Three Months Ended July 3, 2020 As Reported M&A Related Costs LOGCAP V Pre- Operational Legal Costs Amortization of acquired intangible assets Three Mo
Slide 18: Reconciliation Of Non-GAAP Measures
Reconciliation Of Non-GAAP Measures Page 18 Adjusted Net Income, Adjusted Diluted Earnings Per Share (Non-GAAP Measures) ($K, except per share data) Six Months Ended July 2, 2021 As Reported M&A Related Costs LOGCAP V Pre- Operational Legal Costs Amortization of acquired intangible assets Six Months
Slide 19: Reconciliation Of Non-GAAP Measures
Reconciliation Of Non-GAAP Measures Page 19 Adjusted Net Income, Adjusted Diluted Earnings Per Share (Non-GAAP Measures) ($K, except per share data) Six Months Ended July 3, 2020 As Reported M&A Related Costs LOGCAP V Pre- Operational Legal Costs Amortization of acquired intangible assets Six Months
Slide 20: Reconciliation Of Non-GAAP Measures
Reconciliation Of Non-GAAP Measures Page 20 ($K) Three Months Ended July 2, 2021 As Reported Three Months Ended July 2, 2021 Zenetex & HHB Three Months Ended July 2, 2021 As Reported - Organic Revenue $ 470,845 $ 64,397 $ 406,448 ($K) Three Months Ended July 3, 2020 As Reported Three Months Ended Ju