Slide 1: 2Q 2018 Earnings Conference Call
2Q 2018 Earnings Conference Call July 26, 2018 NYSE: CW 1 | July 26, 2018 | © 2018 Curtiss-Wright
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 website from one to twelve months following the initial presentation, but content will not be updated to reflect n
Slide 3: 2018 Second Quarter Performance and Full-Year Business Outlook
2018 Second Quarter Performance and Full-Year Business Outlook Second Quarter 2018 Highlights (1) (2) Net Sales up 9% overall (4% organic) – Driven by strong demand in defense and industrial markets Adjusted Operating Income up 28%; Adjusted Operating Margin of 17.6%, up 260 basis points – Drive
Slide 4: 2Q 2018 End Market Sales Growth
2Q 2018 End Market Sales Growth Key Drivers 2Q’18 % of Total Defense Markets (19% sales growth, 9% organic) Change Sales Aerospace Defense: Higher sales of actuation and Aero Defense 10% 16% flight test equipment on fighter jet programs Ground Defense: Higher embedded computing sales Ground Defe
Slide 5: 2Q 2018 Operating Income / Margin Drivers
2Q 2018 Operating Income / Margin Drivers Change 2Q’18 2Q’17 vs. 2017 ($ in millions) Adjusted(1) Adjusted(1) Adjusted(1) Key Drivers Commercial / Industrial $51.7 $43.6 19% Higher sales and favorable absorption Benefit of Op margin improvement initiatives, including Margin 16.6% 15.0% 160 bps s
Slide 6: 2018E End Market Sales Growth (Guidance as of July 25, 2018)
2018E End Market Sales Growth (Guidance as of July 25, 2018) Updated (in blue) FY2018E FY2018E % of Total (Prior) (Current) Sales Aero Defense 8 - 10% 11 - 13% 16% Ground Defense 0 - 2% No change 4% Naval Defense 16 - 18% 20 - 22% 20% Total Defense 13 - 15% 9 - 11% 41% Including Other Defense (6 - 8
Slide 7: 2018E Financial Outlook (Guidance as of July 25, 2018)
2018E Financial Outlook (Guidance as of July 25, 2018) Updated (in blue) 2018 Prior 2018 Updated 2018 Current 2018 Change 2017 Adjusted Reported Operational Reported Adjusted vs 2017 ($ in millions) (Non-GAAP) (1) (GAAP) Changes (GAAP) Adjustments(1) (Non-GAAP) (1) Adjusted(1) Commercial / Ind $1,16
Slide 8: 2018E Financial Outlook (Guidance as of July 25, 2018)
2018E Financial Outlook (Guidance as of July 25, 2018) Updated (in blue) 2018 2018 Prior Updated 2018 Current 2018 Change ($ in millions, except 2017 Adjusted Reported Operational Reported Adjusted vs 2017 (1) (1) (1) (1) EPS) (Non-GAAP) (GAAP) Changes (GAAP) Adjustments (Non-GAAP) Adjusted Total Op
Slide 9: 2018E Financial Outlook (Guidance as of July 25, 2018)
2018E Financial Outlook (Guidance as of July 25, 2018) Updated (in blue) 2018 2018 Prior 2018 Updated Current Reported Operational Reported Adjusted (2) (2) ($ in millions) (GAAP) Changes (GAAP) Adjustments (Non-GAAP) Free Cash Flow(1) $240 - 260 $10 $250 - 270 $50 $300 - 320 Free Cash Flow (1) 98 -
Slide 10: Positioned to Deliver Strong 2018 Results
Positioned to Deliver Strong 2018 Results Synchronized sales growth, up 8 - 9% – Up 5 - 6% organic, increases in all end markets Continued operating margin expansion – Driven by improving sales outlook and benefit of ongoing margin improvement initiatives – Adjusted operating margin of 15.2% - 1
Slide 11: Appendix
Appendix Non-GAAP Financial Results The company reports its financial performance in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This press release refers to "Adjusted" amounts, which are Non-GAAP financial measures described below. We utilize a
Slide 12: 2018E End Market Sales Waterfall (Guidance as of July 25, 2018)
2018E End Market Sales Waterfall (Guidance as of July 25, 2018) ($ Millions) Total CW End Markets Guidance: $2,445 - 2,485 UP 8 - 9% Defense Markets up 13-15% (up 6-8% organic) Comm’l Markets up 3-5% Defense Markets Commercial Markets 41% 59% Naval Commercial Aerospace Power Generation General Indus
Slide 13: Non-GAAP Reconciliation – Organic Results
Non-GAAP Reconciliation – Organic Results Three Months Ended June 30 2018 vs 2017 Commercial/Industrial Defense Power Total Curtiss-Wright Operating Operating Operating Operating Sales Sales Sales Sales income income income income Organic 5% 16% 15% 86% (7%) (3%) 4% 32% Acquisitions 0% 0% 0% 0% 15%
Slide 14: Non-GAAP Reconciliations – 2Q 2018 Results
Non-GAAP Reconciliations – 2Q 2018 Results (In millions, except EPS) 2Q-2018 2Q-2017 Change Sales $ 620.3 $ 567.7 9% Reported operating income (GAAP) $ 102.1 $ 79.7 28% Adjustments (1) 7.0 5.2 - Adjusted operating income (Non-GAAP) $ 109.1 $ 85.0 28% Adjusted operating margin (Non-GAAP) 17.6% 15.0%
Slide 15: Non-GAAP Reconciliation – 2018 Guidance
Non-GAAP Reconciliation – 2018 Guidance 15 | July 26, 2018 | © 2018 Curtiss-Wright
Slide 16: Non-GAAP Reconciliation – 2017 Results
Non-GAAP Reconciliation – 2017 Results 16 | July 26, 2018 | © 2018 Curtiss-Wright