Mercury Systems Inc · NASDAQ:MRCY
Mercury Systems — Q1 2023 Earnings Presentation
16 slides from Mercury Systems's earnings presentation, Nov 1, 2022
Slide 1: First Quarter Fiscal Year 2023 Financial Results
FIRST QUARTER FISCAL YEAR 2023 FINANCIAL RESULTS Mark Aslett President and CEO Michael Ruppert Executive Vice President and CFO November 1, 2022, 5:00 pm ET Webcast login at www.mrcy.com/investor Webcast replay available by 7:00 p.m. ET November 1, 2022 © 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 products and services described herein and to business performance in fiscal 2023 and
Slide 3: Q1 FY23 results solid, raising guidance
Q1 FY23 results solid, raising guidance Exceeded guidance across all metrics, raising low-end of FY23 revenue and adj. EBITDA outlook Demand remains favorable: YOY backlog, bookings growth, 1.17 Q1 book-to-bill, 1.14 last 12 months Expect solid Q2 and full-year bookings to fuel increase in H2F
Slide 4: Business momentum improving
Business momentum improving Entering fourth fiscal year of navigating pandemic; expect macro forces to continue Executing on our plan to control what we can; our positioning remains strong We believe Q1 marked the FY23 bottom for organic revenue growth, CF, and margins Entering multi-year pe
Slide 5: Macro environment and industry changes remain favorable
Macro environment and industry changes remain favorable Challenging geopolitical environment rivals Cold War era Heading into super-cycle in US; allied country defense spending; growing electronic content Supply-side labor, material and inflation challenges remain as temporary headwinds Anti
Slide 6: FY23 business outlook, 1MPACT
FY23 business outlook, 1MPACT Challenging but stable supply chain, while high-end semiconductors lead times remain long High end processing represents 70% of Mercury's business and largest growth opportunity 1MPACT progress managing industry headwinds, streamlining structure, and strengthening
Slide 7: Q1 FY23 vs. Q1 FY22
Q1 FY23 vs. Q1 FY22 Notes In $ millions, except percentage and per share data Q1 FY22(3) Q1 FY23(3) CHANGE (1) Organic revenue represents total company revenue excluding net revenue from acquisitions for the first four full quarters since Bookings $199.3 $266.9 the entities’ acquisition date 34% (wh
Slide 8: Balance sheet
Balance sheet Notes As of (1) Rounded amounts used. (In $ millions)(1) 10/1/21 12/31/21 4/1/22 7/1/22 9/30/22 ASSETS Cash & cash equivalents $95.8 $105.2 $91.7 $65.7 $52.0 Accounts receivable, net 301.2 320.1 367.1 447.9 494.7 Inventory, net 234.4 251.3 259.6 270.3 287.6 PP&E, net 128.7 127.4 125.7
Slide 9: Cash flow summary
Cash flow summary Notes For the Fiscal Quarters Ended (1) Rounded amounts used. (2) Non-GAAP, see (In $ millions)(1) 10/1/21 12/31/21 4/1/22 7/1/22 9/30/22 reconciliation table. Net (Loss) Income ($7.1) ($2.6) $4.1 $16.9 ($14.3) Depreciation and amortization 21.5 24.1 24.5 23.4 23.7 Other non-cash i
Slide 10: Q2 FY23 guidance
Q2 FY23 guidance Notes (1) (2)(5) In $ millions, except percentage and per share data Q2 FY22 Q2 FY23 CHANGE (1) Q2 FY22 figures are as reported in the Company’s earnings release dated February 1, 2022. (2) The guidance included herein is from the Company’s earnings release dated Revenue $220.4 $225
Slide 11: FY23 annual guidance
FY23 annual guidance Notes (1) (2)(5) In $ millions, except percentage and per share data FY22 FY23 CHANGE (1) FY22 figures are as reported in the Company’s earnings release dated August 2, 2022. (2) The guidance included herein is from the Company’s earnings release dated Revenue $988.2 $1,010.0 -
Slide 12: Summary
Summary Entered FY23 with record backlog and new-business momentum Expect FY23 return to organic growth, revenue >$1B, improved margins, and positive cash flow Positioned for improved FY23 and stronger FY24; five-year plan intact with solid fundamentals Implementing 1MPACT provides near and
Slide 13: Appendix
mercury APPENDIX 13
Slide 14: Adjusted EPS reconciliation
Adjusted EPS reconciliation (2)(4) (2)(4) Notes Q2 FY23 FY23 (1) Per share information is presented on (2) (In thousands, except per share data) Q1 FY22 Q1 FY23 LTM Q1 FY22 LTM Q1 FY23 Low High Low High a fully diluted basis. (2) Rounded amounts used. (1) (3) Impact to income taxes is calculated by
Slide 15: Adjusted EBITDA reconciliation
Adjusted EBITDA reconciliation (1)(2) (1)(2) Notes Q2 FY23 FY23 1. Rounded amounts used. (1)(2) 2. All references in this presentation to (In thousands) Q1 FY22 Q1 FY23 LTM Q1 FY22 LTM Q1 FY23 Low High Low High the second quarter of fiscal 2023 are to the quarter ending December 30, Net (Loss) Incom
Slide 16: Free cash flow reconciliation; Organic revenue reconciliation
Free cash flow reconciliation (In thousands) Q1 FY22 Q1 FY23 LTM Q1 FY22 LTM Q1 FY23 Cash (used in) provided by operating activities $ (2,006) $ (66,039) $ 72,312 $ (82,902) Purchases of property and equipment (5,377) (7,328) (39,998) (29,607) Free cash flow $ (7,383) $ (73,367) $ 32,314 $ (112,509)