Slide 1: First Quarter Fiscal Year 2022 Financial Results
FIRST QUARTER FISCAL YEAR 2022 FINANCIAL RESULTS Mark Aslett President and CEO Michael Ruppert Executive Vice President and CFO November 2, 2021, 5:00 pm ET Webcast login at www.mrcy.com/investor Webcast replay available by 7:00 p.m. ET November 2, 2021 © Mercury Systems, Inc.
Slide 2: Forward-looking safe harbor statement
Forward-looking safe harbor statement This presentation contains certain forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including those relating to the acquisitions described herein and to fiscal 2022 business performance and beyond and t
Slide 3: Q1 results in line with expectations
Q1 results in line with expectations Total revenue exceeded high end of guidance 1MPACT transformation efforts progressing well Signed agreement to acquire Avalex Technologies Expect flat organic growth, 10% total revenue growth eclipsing $1B for FY22 Anticipate substantial bookings growth
Slide 4: Q1 and LTM FY22 results
Q1 and LTM FY22 results Notes Q1 FY22 VS. Q1 FY21 LTM FY22 VS. LTM FY21 (1) Organic revenue represents total company revenue excluding net revenue from acquisitions for the first four full quarters since the entities’ acquisition date (which Bookings decreased 1% Bookings decreased 6% excludes a
Slide 5: FY22 business outlook
FY22 business outlook Expect total revenue to continue growing faster than overall defense spending Anticipate defense budget CR for one quarter Carefully managing elevated risks related to COVID and supply chain Protecting health, safety and livelihoods of employees Anticipate double-digi
Slide 6: Dramatically scaled and transformed business since FY14
Dramatically scaled and transformed business since FY14 Deployed $1.2B in capital on 13 capability-led acquisitions Grew total revenue 4.4x, adjusted EBITDA 9x, resulting in significant market cap increase 1MPACT value creation effort progressing well, led by newly hired CTO Thomas Huber Goa
Slide 7: M&A update
M&A update Apply 1MPACT methodologies to future M&A to accelerate value creation Active M&A pipeline with multiple opportunities in line with strategy Disciplined approach in deal pursuits, diligence and integration Expect to close Avalex transaction in early November Avalex continues to b
Slide 8: Executing on strategy: strong margins, organic growth, M&A, full integration
Executing on strategy: strong margins, organic growth, M&A, full integration 1) Drive ~10% average organic revenue growth supplemented by strategic M&A 2) Invest in people, technologies, facilities, manufacturing assets, business systems 3) Insource more manufacturing; drive stronger operating perfo
Slide 9: Summary
Summary Expect substantial growth in bookings and backlog in FY22 Expecting strong FY23 as organic growth returns and margins expand Elevated risk levels with defense budget CR, federal vaccination mandate and supply chain Aligned business with national defense strategy and key industry tren
Slide 10: Q1 FY22 vs. Q1 FY21
Q1 FY22 vs. Q1 FY21 Notes In $ millions, except percentage and per share data Q1 FY21(3) Q1 FY22(3) CHANGE (1) Organic revenue represents total company revenue excluding net revenue from acquisitions for the first four full quarters since Bookings $200.7 $199.3 the entities’ acquisition date (1%) (w
Slide 11: Balance sheet
Balance sheet Notes As of (1) Rounded amounts used. (In $ millions)(1) 10/2/20 1/1/21 4/2/21 7/2/21 10/1/21 ASSETS Cash & cash equivalents $239.1 $109.1 $121.9 $113.8 $95.8 Restricted cash - 61.6 - - - Accounts receivable, net 207.8 240.2 264.0 291.7 301.2 Inventory, net 206.0 218.4 226.8 221.6 234.
Slide 12: Cash flow summary
Cash flow summary Notes For the Fiscal Quarters Ended (1) Rounded amounts used. (2) Non-GAAP, see (In $ millions)(1) 10/2/20 1/1/21 4/2/21 7/2/21 10/1/21 reconciliation table. Net Income (Loss) $15.8 $12.7 $15.6 $17.9 ($7.1) Depreciation and amortization 13.0 13.3 20.0 20.8 21.5 Gain on investment -
Slide 13: Q2 FY22 guidance
Q2 FY22 guidance Notes (1) (2)(4) In $ millions, except percentage and per share data Q2 FY21 Q2 FY22 CHANGE (1) Q2 FY21 figures are as reported in the Company’s earnings release dated February 2, 2021. (2) The guidance included herein is from the Company’s earnings release dated Revenue $210.7 $215
Slide 14: FY22 annual guidance
FY22 annual guidance Notes (1) (2)(5) In $ millions, except percentage and per share data FY21 FY22 CHANGE (1) FY21 figures are as reported in the Company’s earnings release dated August 3, 2021. (2) The guidance included herein is from the Company’s earnings release dated Revenue $924.0 $1,000.0 -
Slide 15: Summary
Summary Financial performance for the first quarter aligned with expectations Expecting strong growth in bookings, revenue and margin over the course of the year Positioned for HSD/LDD organic growth and margin expansion in FY23 Investments in capital, R&D and M&A driving key design wins on
Slide 16: Appendix
mercury APPENDIX 16
Slide 17: Adjusted EPS reconciliation
Adjusted EPS reconciliation Notes (1) Per share information is presented on a fully diluted basis. (2) Rounded amounts used. (3) Impact to income taxes is calculated by recasting income before income taxes to include the add-backs involved in determining adjusted income and recalculating the income
Slide 18: Adjusted EBITDA reconciliation
Adjusted EBITDA reconciliation Notes (1) Rounded amounts used. (2) All references in this presentation to the second quarter of fiscal 2022 and full fiscal 2022 are to the quarter ending December 31, 2021 and the 52- week period ending July 1, 2022. 18 © Mercury Systems, Inc.
Slide 19: Free cash flow and organic revenue reconciliation
Free cash flow reconciliation Organic revenue reconciliation Notes (In thousands) Q1 FY21 Q1 FY22 LTM Q1 FY21 LTM Q1 FY22 (1) Organic revenue represents total company revenue excluding net revenue from acquisitions for the first four full quarters since (1) the entities’ acquisition date (which excl