Slide 1: 4Q and Full Year 2011 Earnings Conference Call
4Q and Full Year 2011 Earnings Conference Call February 15, 2012
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 web site from one to twelve months following the initial presentation, but content will not be updated to reflect
Slide 3: Overview of 2011 Results
Overview of 2011 Results • Solid sales and operating income growth, despite lower profitability in oil & gas large project business • Commercial markets performed well, led by commercial aerospace and general industrial • Strategic diversification across our defense markets limited downside risk • S
Slide 4: Full Year 2011 Results
Full Year 2011 Results Key sales drivers: ($ in Millions) Full Year % Change • Organic growth of 3%* with gains across all 2011 vs. Prior Yr three segments Sales: • Solid, double-digit increases in the Flow Control $ 1,060.8 4% commercial aerospace, general industrial Motion Control 710.0 10% and ae
Slide 5: 2011 Segment Review – Flow Control
2011 Segment Review – Flow Control Full Year 2011 Results Oil & Gas • Sales up 4%; Operating income 23% Naval (down 1%) and margin impacted Defense 31% by reduced profitability in oil & gas market • Achieved solid sales in the general industrial and power generation markets Gen • Naval sales lower d
Slide 6: 2011 Segment Review – Motion Control
2011 Segment Review – Motion Control Full Year 2011 Results • Sales up 10%; 4% of which was Comm Aero 26% organic* Aero Defense 39% • Operating income up 1%; Organic growth of 11%* • Operating margin dilution due to Gen recent acquisitions 110 bps, as Industrial expected, and 70 bps in 10% unfavorab
Slide 7: 2011 Segment Review – Metal Treatment
2011 Segment Review – Metal Treatment Full Year 2011 Results • Sales up 28% Comm Aero 39% • Operating income up 70% Gen Industrial • Strong operating margin 38% improvement on higher sales, aided by acquisitions • Led by higher demand for shot peening and coatings services • Continued strong sales t
Slide 8: 2011 End Markets Summary
2011 End Markets Summary Key Positives Aero • Commercial markets up 12% Oil & Gas Defense 12% • Defense markets up 4% 15% • Benefiting from ongoing ramp up in Ground commercial aircraft production rates Defense 6% • Continued demand for embedded Power Gen 19% computing, and sensor and control produc
Slide 9: Summary & Outlook – Defense
Summary & Outlook – Defense Aero Full Year 2011 Results Defense • 4% growth in sales 15% Oil & Gas • Strength in military aircraft, helicopters, 12% submarines, CVN-79 carrier and Ground international turret drive aiming and Defense 6% stabilization systems Power Gen • Solid sales performance offset
Slide 10: Summary & Outlook – Commercial Aerospace
Summary & Outlook – Commercial Aerospace Full Year 2011 Results Aero Oil & Gas Defense • 30% growth in sales, 12% of which 12% 15% was organic* Ground • Strong sales due to increased Defense 6% demand from Boeing and Airbus Power Gen 19% • Increased demand for sensor and control products on various
Slide 11: Summary & Outlook – Oil & Gas
Summary & Outlook – Oil & Gas Oil & Gas Full Year 2011 Results 12% Aero Defense • 4% decrease in sales 15% • Improved sales for MRO & services Ground in refining and petrochemical Defense industries 6% Power Gen • Solid demand for super vessels 19% • Continued delays in capital Naval spending worldw
Slide 12: Summary & Outlook – Power Generation
Summary & Outlook – Power Generation Full Year 2011 Results Aero Oil & Gas Defense • 8% growth in sales 12% 15% • Led by U.S. and China AP1000 sales Power Gen Ground • Higher domestic aftermarket demand Defense 19% 6% leading to pump and valve sales • Solid new orders supporting existing nuclear ope
Slide 13: Summary & Outlook – General Industrial
Summary & Outlook – General Industrial Aero Full Year 2011 Results Oil & Gas 12% Defense • 17% growth in sales 15% • Led by higher global sales volumes Ground Defense to commercial HVAC, automotive 6% and transportation industries Power Gen 19% • Strong demand for metal treatment services Naval Defe
Slide 14: 2012E Market Outlook
2012E Market Outlook (as of February 14, 2012) Management Guidance FY2012E Aero Defense 2 - 4% Ground Defense (2) - (4%) Naval Defense 3 - 5% Total Defense 3 - 5% Including Other Defense Commercial Aero 18 - 20% Oil & Gas 7 - 9% Power Generation 18 - 20% General Industrial 6 - 8% Total Commercial 13
Slide 15: 2012E Financial Outlook
2012E Financial Outlook (as of February 14, 2012) (in 000’s) Management Guidance FY2012E Total Sales $2,230 - 2,270M 9% - 11% Flow Control $1,170 - 1,180M 10% - 11% Motion Control $750 - 770M 6% - 8% Metal Treatment $310 - 320M 9% - 13% Operating Income $240 - 248M 17% - 21% Flow Control $119 - 122M
Slide 16: 2012E Financial Outlook
2012E Financial Outlook (as of February 14, 2012) Management Guidance FY2012E Operating Income $240 - 248M 17% - 21% Interest Expense, net $33 - 34M Diluted EPS $2.95 - 3.05 6% - 10% Diluted Shares Outstanding 47.5M Effective Tax Rate 32.0% Curtiss-Wright Corporation 16
Slide 17: 2012E vs. 2011A Pro Forma EPS Growth
2012E vs. 2011A Pro Forma EPS Growth (as of February 14, 2012) Management Guidance FY2012E Growth % 2011 Full Year EPS $2.77 21% (vs. 2010) Less: R&D Tax Credit ($0.09) 2011 Pro Forma EPS $2.68 Benefits: Sales Volume $0.26 - 0.31 OI Margin Improvement $0.31 - 0.36 Subtotal: $3.25 - 3.35 21 - 25% Les
Slide 18: 2012E Financial Outlook
2012E Financial Outlook (as of February 14, 2012) Management Guidance FY2012E Free Cash Flow (1) $90 - 100M Depreciation & Amortization $100 - 105M Capital Expenditures $90 - 95M Pension Expense ~$26.5M (1) Free Cash Flow is defined as cash flow from operations less capital expenditures and includes
Slide 19: Outlook for 2012 and Closing Comments
Outlook for 2012 and Closing Comments • Strong, double-digit growth in Sales, Operating Income and EPS • Continued execution and margin expansion • Strong performances expected in commercial aerospace and power generation markets • Expecting a solid rebound in sales and profitability in oil & gas ma
Slide 20: Appendix
Appendix Curtiss-Wright Corporation 20
Slide 21: Non-GAAP Reconciliation
Non-GAAP Reconciliation Curtiss-Wright Corporation 21