Huntington Ingalls Industries, Inc. · NYSE:HII
Huntington Ingalls Industries — Q2 2016 Earnings Presentation
19 slides from Huntington Ingalls Industries's earnings presentation, Aug 4, 2016
Slide 1: Q2 2016 Earnings Presentation
Q2 2016 Earnings Presentation August 4, 2016 Mike Petters President and Chief Executive Officer Chris Kastner Executive Vice President, Business Management and Chief Financial Officer Exhibit 99.2
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements 2 Statements in this presentation, other than statements of historical fact, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties that could cause ou
Slide 3: Q2 2016 Highlights
3 Q2 2016 Highlights 3 *Non-GAAP measure. See appendix for definition and reconciliation. Revenues were $1.7 billion in the quarter Diluted EPS was $2.80 in the quarter, compared to $3.20 in Q2 2015. Diluted EPS in Q2 2015 included the after-tax impacts of the following items: o Favorable insura
Slide 4: Q2 2016 Consolidated Results
4 Q2 2016 Consolidated Results 4 *Non-GAAP measures. See appendix for definitions and reconciliations. $1,745 $1,700 $1,758 $1,500 $1,550 $1,600 $1,650 $1,700 $1,750 $1,800 Q2 2015 Q2 2016 ($ in m illi on s) Revenues GAAP Adjusted* $269 $217 $192 $— $50 $100 $150 $200 $250 $300 Q2 2015 Q2 2016 ($ in
Slide 5: Capital Deployment and Cash Flow Generation
5 $24 $48 $36 $84 $— $25 $50 $75 $100 $125 $150 Q2 2016 Q2 2016 YTD ($ in m illi on s) Shareholder Distribution Dividends Share Repurchases ($ at cost) Capital Deployment *Non-GAAP measure. See appendix for definition and reconciliation. Completed the planned $167 million discretionary contributio
Slide 6: Q2 2016 Ingalls Shipbuilding Results
6 Q2 2016 Ingalls Shipbuilding Results 6 Ingalls revenues up 4.7% YoY from the Q2 2015 adjusted revenues due to increased volumes on DDG, LPD and LHA programs. Segment operating income* and margin* up YoY due to higher risk retirement on the LPD program, partially offset by lower risk retirement
Slide 7: Q2 2016 Newport News Shipbuilding Results
7 Q2 2016 Newport News Shipbuilding Results 7 Newport News revenues down 6.5% YoY due to lower volumes in Aircraft Carriers, Submarines and Energy. Segment operating income* down YoY due to lower risk retirement on the VCS program and lower volumes on CVN-72 and CVN-78, partially offset by highe
Slide 8: Q2 2016 Other Segment Results
8 (182.9)% (22.2)%(14.3)% (200.0)% (150.0)% (100.0)% (50.0)% (0.0)% 50.0 % Segment Operating Margin* Unadjusted Adjusted* $(64) $(6) $(5) $(70) $(55) $(40) $(25) $(10) $5 $20 ($ in m illi on s) Segment Operati g Loss* Unadjusted Adjusted* Q2 2016 Other Segment Results 8 Q2 2015 Q2 2016 Q2 2016 Q2 20
Slide 9: Appendix
9 9 Appendix
Slide 10: Non-GAAP Measures Definitions & Reconciliations
10 Non-GAAP Measures Definitions & Reconciliations 10 We make reference to “segment operating income (loss),” “segment operating margin,” “adjusted sales and service revenues,” “adjusted segment operating income (loss),” “adjusted segment operating margin,” “adjusted operating income,” “adjusted ope
Slide 11: Non-GAAP Measures Definitions & Reconciliations Cont'd
11 Non-GAAP Measures Definitions & Reconciliations Cont’d 11 Segment operating income (loss) is defined as operating income (loss) for the relevant segment(s) before the FAS/CAS Adjustment and deferred state income taxes. Segment operating margin is defined as segment operating income (loss) as a pe
Slide 12: Reconciliation – Segment Operating Income & Segment Operating Margin
12 Reconciliation – Segment Operating Income & Segment Operating Margin 12 $ in millions 2016 2015 2016 2015 Ingalls revenues 585$ 546$ 1,171$ 1,015$ Newport News revenues 1,090 1,166 2,243 2,227 Other revenues 27 35 51 75 Intersegment eliminations (2) (2) (2) (2) Sales and Service Revenues 1,700 1,
Slide 13: Reconciliation – Adjusted Sales and Service Revenues
13 Reconciliation – Adjusted Sales and Service Revenues 13 $ in millions 2016 2015 2016 2015 Ingalls revenues 585$ 546$ 1,171$ 1,015$ Adjustment for insurance litigation settlement — 13 — 13 Ingalls adjusted revenues 585 559 1,171 1,028 Newport News revenues 1,090 1,166 2,243 2,227 Other revenues 27
Slide 14: Reconciliation – Adjusted Segment Operating Income & Margin
14 Reconciliation – Adjusted Segment Operating Income & Adjusted Segment Operating Margin 14 $ in millions 2016 2015 2016 2015 Operating income 217$ 269$ 415$ 425$ As a percentage of sales and service revenues 12.8 % 15.4 % 12.0 % 12.8 % Non-segment factors affecting operating income: FAS/CAS Adjust
Slide 15: Reconciliation – Adjusted Operating Income & Adjusted Operating Margin
15 Reconciliation – Adjusted Operating Income & Adjusted Operating Margin 15 $ in millions 2016 2015 2016 2015 Operating income 217$ 269$ 415$ 425$ As a percentage of sales and service revenues 12.8 % 15.4 % 12.0 % 12.8 % Adjustment for insurance litigation settlement — (136) — (136) Adjustment for
Slide 16: Reconciliation – Adjusted Net Earnings & Adjusted Diluted EPS
16 Reconciliation – Adjusted Net Earnings & Adjusted Diluted EPS 16 $ in millions, except per share amounts 2016 2015 2016 2015 Net Earnings (Loss) 133$ 156$ 269$ 243$ After-tax adjustment for insurance litigation settlement (1) — (88) — (88) After-tax adjustment for impairment of goodwill (2) — 47
Slide 17: Reconciliation – Adjusted Net Earnings & Adjusted Diluted EPS Cont'd
17 Reconciliation – Adjusted Net Earnings & Adjusted Diluted EPS Cont’d 17 *The income tax impact is calculated using the tax rate in effect for the relevant non-GAAP adjustment. **Amounts may not recalculate exactly due to rounding. $ in millions, except per share amounts 2016 2015 2016 2015 (1) In
Slide 18: Reconciliation – Free Cash Flow
18 Reconciliation – Free Cash Flow 18 ($ in millions) 2016 2015 2016 2015 Net cash provided by (used in) operating activities 169$ 166$ 223$ 176$ Less: Capital expenditures (48) (29) (85) (49) Free cash flow 121$ 137$ 138$ 127$ Six Months Ended June 30 Three Months Ended June 30
Slide 19: Huntington Ingalls Industries
Huntington Ingalls Industries
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