Howmet Aerospace Inc. · NYSE:HWM
Howmet Aerospace — Q1 2025 Earnings Presentation
30 slides from Howmet Aerospace's earnings presentation, May 1, 2025
Slide 1: First Quarter 2025 Earnings Call
First Quarter 2025 Earnings Call John Plant: Executive Chairman and Chief Executive Officer Ken Giacobbe: EVP and Chief Financial Officer May 1, 2025
Slide 2: Important Information
Important Information Forward–Looking Statements This presentation contains statements that relate to future events and expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those
Slide 3: Important Information (continued)
Important Information (continued) Non-GAAP Financial Measures Some of the information included in this presentation is derived from Howmet Aerospace’s consolidated financial information but is not presented in Howmet Aerospace’s financial statements prepared in accordance with accounting principles
Slide 4: Q1 2025 Highlights
Q1 2025 Highlights Revenue and Profitability Excluding Special Items1,2 Q1 2024 Q4 2024 Q1 2025 Q1 YoY Revenue $1.824B $1.891B $1.942B +6% Adj EBITDA1 $437M $507M $560M +28% Adj EBITDA Margin1 24.0% 26.8% 28.8% +480 bps Adj Operating Income1 $370M $434M $491M +33% Adj Operating Income Margin1 20.3%
Slide 5: Q1 2025 Revenue Up 6% YoY, Commercial Aerospace Up 9% YoY
Q1 2025 Revenue Up 6% YoY, Commercial Aerospace Up 9% YoY Q1 2025 Revenue by Market Revenue by Market YoY Seq (% of total) (% change) Commercial Aerospace 52% Commercial Aerospace 9% 1% Defense Aerospace 19% 9% $1.942B Total Commercial Transportation (14%) 2% Industrial & 15% Revenue Other Industria
Slide 6: Q1 2025 YoY: Revenue Up 6%, Adj EBITDA Up 28%, Adj EPS Up 51%
Q1 2025 YoY: Revenue Up 6%, Adj EBITDA1 Up 28%, Adj EPS2 Up 51% ▪ Record Revenue Up 6% YoY, driven by Comm Aero Up 9%, Defense Aero Up 19%, Comm Trans Down 14% Enhanced ▪ Record Adj EBITDA1 of $560M, Up 28% YoY. Adj EBITDA Margin1 of 28.8%, Up ~480 bps YoY Profitability ▪ Record Adj Earnings Per Sha
Slide 7: Engine Products: Revenue Up 13% Q1 YoY; Record Adj EBITDA Margin 32.6%
Engine Products: Revenue Up 13% Q1 YoY; Record Adj EBITDA Margin 32.6% Q1 Revenue by Market +13% (% of total) $933M $945M $972M $996M $885M Industrial & Other 23% 3rd Party Revenue 55% Commercial Aerospace Defense Aerospace 22% Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q1 2025 YoY +31% Segment $307M $
Slide 8: Fastening Systems: Revenue Up 6% Q1 YoY; Record Adj EBITDA Margin 30.8%
Fastening Systems: Revenue Up 6% Q1 YoY; Record Adj EBITDA Margin 30.8% Q1 Revenue by Market +6% (% of total) $389M $394M $392M $401M $412M Industrial & Other 10% 3rd Party Revenue Commercial Transportation 13% 67% Commercial Aerospace 10% Defense Aerospace Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q1
Slide 9: Engineered Structures: Revenue Up 8% Q1 YoY; Record Adj EBITDA Margin 21.3%
Engineered Structures: Revenue Up 8% Q1 YoY; Record Adj EBITDA Margin 21.3% Q1 Revenue by Market +8% (% of total) $262M $275M $275M $282M Industrial & Other $253M 5% 3rd Party Revenue Defense Aerospace 27% 68% Commercial Aerospace Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q1 2025 YoY +62% Segment $60M
Slide 10: Forged Wheels: Revenue Down 13% Q1 YoY; Adj EBITDA Margin 27.0%
Forged Wheels: Revenue Down 13% Q1 YoY; Adj EBITDA Margin 27.0% Q1 Revenue by Region -13% (% of total) $288M $278M Other $245M $243M $252M 14% 3rd Party Revenue 54% North America Europe 32% Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q1 2025 YoY -17% Segment $82M - Commercial Transportation Market Down
Slide 11: 2025 Guidance: Includes Current Assumptions of Tariff Impacts
2025 Guidance: Includes Current Assumptions of Tariff Impacts Q2 2025 Guidance FY 2025 Guidance What we expect in 2025 Low Baseline High Low Baseline High Revenue $1.980B $1.990B $2.000B $7.880B $8.030B $8.180B ▪ FY 2025 Revenue up ~8% vs. FY 2024 Increased Range +/-$50M ▪ FY 2025 Adj EBITDA1 up ~18
Slide 12: Summary
Summary ▪ Revenue of $1.94B, Up 6% YoY, driven by Comm Aero Up 9%, Defense Aero Up 19%, Comm Trans Down 14% Revenue / Profit ▪ Adj EBITDA1 of $560M, Up 28% YoY. Adj EBITDA Margin1 of 28.8%, Up ~480 bps YoY Q1 2025 ▪ Adj Earnings Per Share2 of $0.86, Up 51% YoY Cash ▪ Record Q1 Free Cash Flow3 of $13
Slide 13: Howmet Aerospace
rr) HOWMET LJ AEROSPACE
Slide 14: Appendix
Appendix Pl HOWMET UELJ AEROSPACE
Slide 15: 2025 Assumptions
2025 Assumptions Full Year 2025 2025 Comments Corporate Overhead ~$90M ▪ Included in Adj EBITDA Depreciation and Amortization ~$275M Interest Expense ~$160M Operational Tax Rate 20.5% - 21.5% ▪ Cash Tax Rate ~19% ▪ ~$5M Service Costs (included in Adj EBITDA) Pension / OPEB Expense ~$35M ▪ ~$30M Non-
Slide 16: Robust Liquidity; Each Debt Tower Below Annual Free Cash Flow Expectations
Robust Liquidity; Each Debt Tower Below Annual Free Cash Flow Expectations $1,000M $800M Jan 3.0% Feb $700 Feb 5.9% 5.95% $625 $625 $600M Oct 3.72%1 $500 Nov $400M ~3.5% Jan $336 6.75% Aug $300 4.75% $250 $200M 2025 2026 2027 2028 2029 2030 2031 2037 2042 1) After cross-currency swap to syntheticall
Slide 17: Achieved 2024 GHG Reduction Goal, Progress Toward 2027 GHG Goal
Achieved 2024 GHG Reduction Goal, Progress Toward 2027 GHG Goal Environmental Achievements | 2024 Reductions vs 2023 -33.6% Goal by 2027 -21.7% 2024 Goal of 21.5% -20.0% GHG Reduction Achieved GHG Emissions Reduction 13.7% 10.0% 5.4% 8.1% 2019 2023 2024 2027 GHG Intensity Energy Intensity Freshwater
Slide 18: Reconciliation of Net Income and Diluted EPS Excluding Special Items
Reconciliation of Net Income and Diluted EPS Excluding Special Items ($ in millions, except per-share amounts) Q1 2024 Q4 2024 Q1 2025 Net income $243 $314 $344 Diluted Earnings Per Share ("EPS") $0.59 $0.77 $0.84 Average number of diluted shares 412 408 407 Special items: Restructuring and other cr
Slide 19: Reconciliation of Operational Tax Rate
Reconciliation of Operational Tax Rate ($ in millions) Q1 2025 Effective tax Operational rate, as Special tax rate, as reported items(1)(2) adjusted Income before income taxes $446 $(3) $443 Provision for income taxes $102 $(10) $92 Tax rate 22.9% 20.8% Operational tax rate is a non-GAAP financial m
Slide 20: Calculation of Segment Markets Revenue
Calculation of Segment Markets Revenue Engine Fastening Engineered Forged ($ in millions) Products Systems Structures Wheels Total Segment Q1 2024 Aerospace - Commercial $492 $244 $192 $— $928 Aerospace - Defense $185 $39 $56 $— $280 Commercial Transportation $— $66 $— $288 $354 Industrial and Other
Slide 21: Calculation of Segment Information
Calculation of Segment Information ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Engine Products Third-party sales $ 885 $ 933 $ 945 $ 972 $ 3,735 $ 996 Inter-segment sales $ 2 $ 1 $ 3 $ 1 $ 7 $ 2 Provision for depreciation and amortization $ 33 $ 33 $ 34 $ 39 $ 139 $ 34 Segment Ad
Slide 22: Calculation of Segment Information (continued)
Calculation of Segment Information (continued) ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Engineered Structures Third-party sales $ 262 $ 275 $ 253 $ 275 $ 1,065 $ 282 Inter-segment sales $ 1 $ 3 $ 3 $ 3 $ 10 $ 3 Provision for depreciation and amortization $ 11 $ 11 $ 10 $ 10 $
Slide 23: Calculation of Total Segment Adj. EBITDA and Adj. EBITDA Margin
Calculation of Total Segment Adj. EBITDA and Adj. EBITDA Margin ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Third-party sales – Engine Products $885 $933 $945 $972 $3,735 $996 Third-party sales – Fastening Systems $389 $394 $392 $401 $1,576 $412 Third-party sales – Engineered Str
Slide 24: Reconciliation of Total Segment Adj. EBITDA to Income Before Income Taxes
Reconciliation of Total Segment Adj. EBITDA to Income Before Income Taxes ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Income before income taxes $303 $334 $354 $392 $1,383 $446 Loss on debt redemption — — 6 — 6 — Interest expense, net 49 49 44 40 182 39 Other expense, net 17 15 1
Slide 25: Reconciliation of Adj. Corporate Exp. Excluding Depreciation and Special Items
Reconciliation of Adj. Corporate Exp. Excluding Depreciation and Special Items ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Corporate expense $26 $21 $25 $13 $85 $22 Provision for depreciation and amortization 2 2 2 1 7 1 Adjusted Corporate expense excluding depreciation $24 $19 $
Slide 26: Reconciliation of Adj. EBITDA and Adj. EBITDA Margin Excluding Special Items and Incremental Margin
Reconciliation of Adj. EBITDA and Adj. EBITDA Margin Excluding Special Items and Incremental Margin ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Third-party sales $1,824 $1,880 $1,835 $1,891 $7,430 $1,942 Operating income $369 $398 $421 $445 $1,633 $494 Operating income margin 20.
Slide 27: Reconciliation of Adj. Operating Income and Margin Both Excluding Special Items
Reconciliation of Adj. Operating Income and Margin Both Excluding Special Items ($ in millions) Q1 2024 Q2 2024 Q3 2024 Q4 2024 FY 2024 Q1 2025 Third-party sales $1,824 $1,880 $1,835 $1,891 $7,430 $1,942 Operating income $369 $398 $421 $445 $1,633 $494 Operating income margin 20.2% 21.2% 22.9% 23.5%
Slide 28: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow ($ in millions) Q1 2024 Q1 2025 Cash provided from operations $177 $253 Capital expenditures (82) (119) Free cash flow $95 $134 The Accounts Receivable Securitization program remains unchanged at $250 outstanding. Free cash flow is a non-GAAP financial measure. Manag
Slide 29: Reconciliation of Net Debt to Adjusted EBITDA Excluding Special Items
Reconciliation of Net Debt to Adjusted EBITDA Excluding Special Items ($ in millions) Trailing-12 months ended December 31, 2024 March 31, 2025 Net income $1,155 $1,256 Add: Provision for income taxes 228 270 Other expense, net 62 54 Loss on debt redemption 6 6 Interest expense, net 182 172 Restruct
Slide 30: Howmet Aerospace
rr) HOWMET LJ AEROSPACE