Huntington Ingalls Industries, Inc. · NYSE:HII

Huntington Ingalls Industries — Q1 2020 Earnings Presentation

14 slides from Huntington Ingalls Industries's earnings presentation, May 7, 2020

  1. Slide 1: Q1 2020 Earnings Presentation

    Q1 2020 Earnings Presentation May 7, 2020 Mike Petters President and Chief Executive Officer Chris Kastner Executive Vice President and Chief Financial Officer

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements 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 our ac

  3. Slide 3: COVID-19 Response Update

    COVID-19 Response Update  Employee Health and Safety is Paramount o Implemented liberal leave policies that provide employees flexibility and job security  Attendance levels across the business have been impacted o Implemented processes aligned with CDC guidelines regarding the necessary quarantin

  4. Slide 4: HII Q1 2020 Highlights

    HII Q1 2020 Highlights Backlog  Revenues were ~$2.3 billion in the quarter ($B)  Diluted EPS was $4.23 in the quarter $50 $45.2  Total backlog at the end of the quarter was $45.2 billion $40.6 $40  Ingalls Shipbuilding $30 o Delivered amphibious assault ship Tripoli (LHA 7) $20 o Launched amphib

  5. Slide 5: HII Q1 2020 Consolidated Results

    HII Q1 2020 Consolidated Results Consolidated Revenues Operating Income ($M) ($M) $2,500 $2,263 $250 $2,080 $215 $2,000 $200 $161 $1,500 $150 $1,000 $100 $500 $50 $0 $0 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Operating Margin 14.0%  Revenues up 8.8% YoY due to higher volume at 12.0% Newport News and Ingall

  6. Slide 6: Capital Deployment

    Capital Deployment Cash Flow Generation Shareholder Distributions ($M) ($M) $100 $74 $80 $68 $66 $140 $126 $60 $120 $40 $100 $20 $11 $2 $80 $72 $84 $0 $60 -$20 $36 -$40 $40 -$60 $20 $36 $42 -$80 ($63) $0 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Cash from Operations CAPEX Free Cash Flow 1 Dividends Share Repu

  7. Slide 7: Financial Outlook and Liquidity

    Financial Outlook and Liquidity 2020 Outlook2 Liquidity Initial Revised  Strong pre-COVID balance sheet bolstered by recent financing transactions Outlook Outlook (Feb. 2020) (May 7, 2020) o $1B in proceeds from new senior notes offering, $500M new revolving credit 3% to 5% Lower end of facility Sh

  8. Slide 8: Appendix

    Appendix HUNTINGTON INGALLS INDUSTRIES PROPRIETARY

  9. Slide 9: Non-GAAP Measures Definitions

    Non-GAAP Measures Definitions We make reference to “segment operating income,” “shipbuilding revenue,” “shipbuilding operating margin,” “EBITDA margin,” and “free cash flow.” We internally manage our operations by reference to segment operating income, which is not a recognized measures under GAAP.

  10. Slide 10: Non-GAAP Measures Definitions Cont'd

    Non-GAAP Measures Definitions Cont’d Segment operating income is defined as operating income for the relevant segment(s) before the Operating FAS/CAS Adjustment and non- current state income taxes. Shipbuilding revenue is defined as the combined sales and service revenues from our Newport News Shipb

  11. Slide 11: Non-GAAP Reconciliations – Segment Operating Income

    Non-GAAP Reconciliations – Segment Operating Income Three Months Ended March 31 ($ in millions) 2020 2019 Ingalls revenues 629 584 Newport News revenues 1,341 1,279 Technical Solutions revenues 317 240 Intersegment eliminations (24) (23) Sales and Service Revenues 2,263 2,080 Operating Income 215 16

  12. Slide 12: Non-GAAP Reconciliations – Shipbuilding Revenues & Operating Margin

    Non-GAAP Reconciliations – Shipbuilding Revenues & Operating Margin Three Months Ended March 31 ($ in millions) 2020 2019 Sales and service revenues 2,263 2,080 Technical Solutions (317) (240) Intersegment eliminations 24 23 Shipbuilding Revenues 1,970 1,863 Operating Income 215 161 Operating FAS/CA

  13. Slide 13: Non-GAAP Reconciliations – Free Cash Flow

    Non-GAAP Reconciliations – Free Cash Flow Three Months Ended March 31 ($ in millions) 2020 2019 Net cash provided by (used in) operating activities 68 11 Less capital expenditures: Capital expenditure additions (71) (110) Grant proceeds for capital expenditures 5 36 Free cash flow 2 (63) 13 HUNTINGT

  14. Slide 14: HUNTINGTON INGALLS INDUSTRIES HARD STUFF DONE RIGHT

    14 HUNTINGTON INGALLS INDUSTRIES HARD STUFF DONE RIGHT

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