Slide 1: Vectrus Second Quarter 2015 Earnings Presentation
VECTRUS SECOND QUARTER 2015 EARNINGS PRESENTATION KEN HUNZEKER CHIEF EXECUTIVE OFFICER AND PRESIDENT MATT KLEIN SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER AUGUST 6, 2015
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 STATEM
Slide 3: Celebrating 70 Years of Service
v CELEBRATING 70 YEARS Celebrating FOYeans =. of Service See? ae 3 *
Slide 4: Celebrating 70 Years
Vv CELEBRATING 70 YEARS \VECTRUS ; VECTRUS Bec eee gy am veting to serve our customers, ering thet shere in the world, ar a Under any condor, Happy 70> sirthdey and cesneran sl oe Las our ; 5
Slide 5: Q2 2015 Highlights
Q2 2015 HIGHLIGHTS Page 5 • Solid second quarter results o Revenue $309.5 million o Operating margin 3.5% o Diluted earnings per share (EPS) $0.56 o Year-to-date net cash used in operating activities $0.2 million; Free cash flow(1) use $0.9 million Incremental free cash flow2 $26.8 million during
Slide 6: Vectrus Update
VECTRUS UPDATE Page 6 • Macro Environment • Update on 2015 contract re-competes o K-BOSSS extension into March 2016 o APS-5 Kuwait and Qatar award decision anticipated in 2016 o Maxwell Base Operations Support extended into May 2016 • New Business update o Approx. $1 billion of proposals submitted a
Slide 7: Q2 2015 Financial Results
Q2 2015 FINANCIAL RESULTS Page 7 (In millions, except Operating Margin and Diluted Earnings Per Share) Q2 2015 Q2 2014 vs. 2014 Funded Orders 332.4$ 337.0$ (4.6)$ Revenue 309.5$ 312.9$ (3.4)$ Operating Income 10.8$ 9.4$ 1.4$ Operating Margin 3.5% 3.0% 50 bps Diluted Earnings Per Share (1) 0.56$ 0.59
Slide 8: Year to Date 2015 Financial Results
YEAR TO DATE 2015 FINANCIAL RESULTS Page 8 (In millions, except Operating Margin and Diluted Earnings Per Share) Q2 2015 Q2 2014 vs. 2014 Funded Orders 476.0$ 477.3$ (1.3)$ Revenue 570.4$ 616.9$ (46.5)$ Operating Income 20.2$ 27.0$ (6.8)$ Operating Margin 3.5% 4.4% (90) YTD Net Cash Used in Operatin
Slide 9: Backlog
BACKLOG (1) Page 9 (2) (1) Total backlog represents firm orders and potential options on multi-year contracts, excluding potential orders under Indefinite-Delivery/Indefinite-Quantity (IDIQ) contracts. ($B) $0.8 $0.7 $0.7 $2.1 $1.9 $1.8 $- $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 Year Ending December 31,
Slide 10: Updated 2015 Guidance Summary
UPDATED 2015 GUIDANCE SUMMARY PAGE 10 (1) All 2014 numbers exclude TARS program historical results and separation costs. See Appendix for reconciliation. (2) 2015 adjusted operating margin excludes the pretax impact of year-to-date separation costs to be come a stand alone public company in the amou
Slide 11: Vectrus Second Quarter 2015 Earnings Presentation
VECTRUS SECOND QUARTER 2015 EARNINGS PRESENTATION KEN HUNZEKER CHIEF EXECUTIVE OFFICER AND PRESIDENT MATT KLEIN SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER AUGUST 6, 2015
Slide 12: Appendix
ff APPENDIX \VECTRUS.
Slide 13: Reconciliation of Non-GAAP Measures
RECONCILIATION OF NON-GAAP MEASURES (CONT.) Page 13 The primary financial performance measures Vectrus uses to manage its business and monitor results of operations are revenue trends and operating income trends. In addition, we consider adjusted revenue, adjusted operating income, adjusted operatin
Slide 14: Reconciliation of Non-GAAP Measures (Cont.)
RECONCILIATION OF NON-GAAP MEASURES (CONT.) Page 14 (In thousands) Adjusted Operating Income (Non-GAAP Measure) June 26, 2015 June 28, 2014 June 26, 2015 June 28, 2014 Net income 6,020$ 6,132$ 10,985$ 17,367$ Income taxes 3,388 3,317 6,182 9,660 Interest (expense) income (1,437) 27 (3,033) 49 Operat
Slide 15: Reconciliation of Non-GAAP Measures (Cont.)
RECONCILIATION OF NON-GAAP MEASURES (CONT.) Page 15 (In thousands) Free Cash Flow (Non-GAAP Measure) June 26, 2015 June 28, 2014 Net cash (used in) and provided by operating activities (181)$ 2,637$ Subtract: Capital expenditures (734) (1,004) Free cash flow (915)$ 1,633$ Six Months Ended (In millio