Slide 1: Q4 and FY 2020 Earnings Conference Call
Listen-Only dial-in numbers: (844) 220-4970 (domestic) (262) 558-6349 (international) Conference ID: 6585187 Q4 and FY 2020 Earnings Conference Call February 25, 2021 NYSE: CW 1 | February 25, 2021 | © 2021 Curtiss-Wright
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: Leadership Transition
Leadership Transition ▪ Advancing the One Curtiss-Wright Vision ▪ Continued focus on top quartile performance ▪ Pivot to Growth – Acceleration of organic growth and acquisitions ▪ Increasing focus on internal investments ▪ Simplification of CW story and value proposition – Unveiling new Segment and
Slide 4: COVID-19 Update
COVID-19 Update OPERATIONAL STATUS MANAGEMENT ACTIONS ▪ Maintaining focus on Employee health and safety ▪ Preserving Profitability and Free Cash Flow – Global workforce following guidelines and safety – Successfully implemented restructuring plans protocols – Reduced incentive compensation (includin
Slide 5: Strong Finish to 2020: Q4 and FY'20 Highlights
Strong Finish to 2020: Q4 and FY’20 Highlights Fourth Quarter 2020 Highlights ▪ Net Sales increased 2% YOY; Up 17% Sequentially – Strong defense market growth, up 27% overall (15% organic); Sequentially higher sales across all commercial markets ▪ Adjusted Operating Income rose 8%, with Adjusted Ope
Slide 6: Fourth Quarter 2020 Financial Review
Fourth Quarter 2020 Financial Review Q4’20 Q4’19 Chg vs. ($ in millions) Adjusted Adjusted Q4’19 2020 Key Drivers ▪ Reduced YOY demand in commercial aerospace and general industrial (Up sequentially vs Q3) Commercial / Industrial $249 $296 (16%) ▪ Partially offset by higher F-35 sales in aerospace d
Slide 7: Transition to New Segment Structure (2020)
Transition to New Segment Structure (2020) Adjustments Old Segment Division Exiting Non-Core New Segment (1) (FY20 Sales, $ in millions) Structure Realignment Operations Structure Commercial / Industrial $950 ($144) ($67) $738 Aerospace & Industrial Defense $736 ($125) - $611 Defense Electronics Pow
Slide 8: Defense Electronics Segment Transition
Defense Electronics Segment Transition Valves business serving Power Gen and Navy moves to Naval & Power segment Defense Defense Electronics Product Focus Aerospace Ground • COTS embedded computing Defense Aerospace 44% Defense 14% Defense Ground • Tactical battlefield communications 53% Defense 18%
Slide 9: Aerospace & Industrial Segment Transition
Aerospace & Industrial Segment Transition Valves business serving Power Gen and Navy moves to Naval & Power segment “New” General Industrial sales concentrated in one segment Commercial / Industrial Aerospace & Industrial Product Focus Power Commercial Aero Commercial Aero 30% Generation 4% 29% "New
Slide 10: Naval & Power Segment Transition
Naval & Power Segment Transition Division realignment shifts all valves revenue from C/I and Defense segments into new Naval & Power segment “New” Power & Process sales concentrated in one segment Power Naval & Power Product Focus Power "New" • Reactor coolant pumps Naval Generation Naval Power & De
Slide 11: 2021E End Market Sales Waterfall (as of February 24, 2021)
FY’21 Guidance: 2021E End Market Sales Waterfall (as of February 24, 2021) Overall UP 6 - 8% A&D Markets UP 6 - 8% Total 2021 CW End Markets Comm’l Markets UP 6 - 8% $2.445B - 2.495B Aerospace & Defense Markets Commercial Markets 66% $1.6B 34% $0.8B Naval Commercial Aerospace Power & Process General
Slide 12: 2021E End Market Sales Growth (Guidance as of February 24, 2021)
2021E End Market Sales Growth (Guidance as of February 24, 2021) 2021E Growth 2021E vs 2020 % Sales Key Drivers Aero Defense 2% - 4% 19% ▪ Favorable growth on C5ISR and helicopter programs Ground Defense 100% - 105% 9% ▪ Contribution from PacStar acquisition ▪ Solid growth on aircraft carriers offse
Slide 13: 2021E Financial Outlook (Guidance as of February 24, 2021)
2021E Financial Outlook (Guidance as of February 24, 2021) 2020 Adjusted (1) 2021E Change vs (3) ($ in millions) (New Structure) 2021E Adjusted 2020 Adjusted (2)(3) Aerospace & Industrial $738 $745 - 760 1% - 3% ▪ Strong rebound in general industrial markets; part. offset by lower A&D ▪ Solid organi
Slide 14: 2021E Financial Outlook (Guidance as of February 24, 2021)
2021E Financial Outlook (Guidance as of February 24, 2021) 2020 Adjusted (1) ($ in millions, except EPS) (New Structure) 2021E Adjusted (2) Total Operating Income $375 $404 - 414 Solid growth, up 7-10%, despite increased R&D ($10M) Other Income/(Expense) $21 $15 - 17 ▪ Pension (lower discount rates)
Slide 15: Curtiss-Wright Remains Well-Positioned for Long-Term Profitable Growth
Curtiss-Wright Remains Well-Positioned for Long-Term Profitable Growth ▪ Solid revenue growth across A&D and Commercial markets, up 6% - 8% – Improved organic growth (up 2% - 4%) plus PacStar acquisition providing strong boost to top-line ▪ Steady adjusted operating margin expansion to reach 16.5% -
Slide 16: Appendix
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
Slide 17: 2020 End Market Sales Waterfall
2020 End Market Sales Waterfall Total 2020 CW End Markets $2.3B Aerospace & Defense Markets Commercial Markets 66% $1.5B 34% $0.8B Naval Commercial Aerospace Power & Process General Industrial 30% 11% 20% 14% Pumps / Valves / Steam Turbines (Nuclear naval propulsion) Aerospace OEM Nuclear Industrial
Slide 18: Non-GAAP Reconciliation – 2020 vs. 2019 (Adjusted)
Non-GAAP Reconciliation – 2020 vs. 2019 (Adjusted) 18 | February 25, 2021 | © 2021 Curtiss-Wright
Slide 19: Non-GAAP Reconciliation – 2020 vs 2021 (Adjusted)
Non-GAAP Reconciliation – 2020 vs 2021 (Adjusted) 19 | February 25, 2021 | © 2021 Curtiss-Wright
Slide 20: Non-GAAP Reconciliation – 2020 vs 2021 (Adjusted)
Non-GAAP Reconciliation – 2020 vs 2021 (Adjusted) 20 | February 25, 2021 | © 2021 Curtiss-Wright
Slide 21: Non-GAAP Reconciliations – Q4 2020 Results
Non-GAAP Reconciliations – Q4 2020 Results (In millions, except EPS) Q4-2020 Q4-2019 Change Sales $ 668.4 $ 655.8 2% Reported operating income (GAAP) $ 76.5 $ 120.7 (37%) Adjustments (1) 56.4 2.5 Adjusted operating income (Non-GAAP) $ 132.8 $ 123.2 8% Adjusted operating margin (Non-GAAP) 19.8% 18.8%
Slide 22: Non-GAAP Reconciliation – Organic Results
Non-GAAP Reconciliation – Organic Results Three Months Ended December 31, 2020 vs. 2019 Commercial/Industrial Defense Power Total Curtiss-Wright Operating Operating Operating Operating Sales income Sales income Sales income Sales income Organic (18)% (4)% 5% 6% 8% 18% (5)% 5% Acquisitions 1% (1)% 20