Cpi Aerostructures, Inc. · AMEX:CVU
Cpi Aerostructures — FY2017 Earnings Presentation
19 slides from Cpi Aerostructures's earnings presentation, Mar 22, 2018
Slide 1: Q4 & FY 2017 Results; Acquisition of Welding Metallurgy, Inc.
NYSE American : CVU Q4 & FY 2017 Results Acquisition of Welding Metallurgy, Inc. (“WMI”) A Premier Supplier of Aircraft Structures and Systems Speakers: Douglas McCrosson, President & Chief Executive Officer Vincent Palazzolo, Chief Financial Officer March 22, 2018
Slide 2: Disclosure Statement: Forward-Looking Statements
Disclosure Statement Forward - Looking Statements This presentation contains forward - looking statements that involve risks and uncertainties . All statements, other than statements of historical fact, included in this presentation, including without limitation, statements regarding projections, fu
Slide 3: Recent Highlights
3 Recent Highlights Douglas McCrosso n President & Chief Executive Officer
Slide 4: Backlog
Backlog 4 Consolidated Backlog at 12/31/2017: $ 388.7 Million Defense Backlog at $301.3 Million $301.3 $87.4 Defense Commercial Defense 78% / Commercial 22% 1Q 2014 - 4Q 2017 $71.1 $317.7 Funded Unfunded Unfunded backlog represents remaining potential value of long term agreements Funded 18% / Unfun
Slide 5: Driven By Renewed Strength in Defense Business
Driven By Renewed Strength in Defense Business 5 Recent wins account for $282 million in backlog as of December 31, 2017 Offers revenue visibility into 2022 and beyond E - 2D Advanced Hawkeye/ C - 2A Greyhound U.S Government F - 16 Falcon Northrop Grumman T - 38C Talon Trainer Lockheed Martin F - 35
Slide 6: Looking Ahead
6 Looking Ahead Douglas McCrosso n President & Chief Executive Officer
Slide 7: Bid Pipeline (03/20/18)
Bid Pipeline (03/20/18) 7 Virtually all bids are at the Prime Contractor or Tier 1 level Defense opportunities are increasing Continued Diversification Across Product Categories 97% 3% Defense Commerical 52% 4% 17% 27% Kitting MRO Aerostructures Aerosystems
Slide 8: Near-Term Program Opportunities
Near - Term Program Opportunities 8 Aerostructures • Military Helos : CH - 53K, V - 280 • Various regional airline and bizjet aircraft • A - 10 Wing Replacement Program (WRP) • Various Black Hawk components/structural repairs Aerosystems • Reconnaissance Pods • Electronic Warfare Pods • Advanced ant
Slide 9: Long-Term Visibility - Contracts
Potential to collectively generate revenue of $ 388.7M during their remaining periods of performance (as of 12/31/17) Long - Term Visibility - Contracts ‘08 ‘09 ’10 ’11 ’12 ’13 ‘14 ‘15 ‘16 ‘17 ‘18 ‘19 ‘20 ‘21 ‘22 ‘23 ‘24 ‘25 EMBRAER – E175 - E2 RAYTHEON – Next Generation Jammer Increment 1 Pod SIKOR
Slide 10: Acquisition of Welding Metallurgy, Inc. (WMI)
10 Acquisition of Welding Metallurgy, Inc. (“WMI”) Douglas McCrosso n President & Chief Executive Officer
Slide 11: Strategic Rationale
Strategic Rationale 11 • Adds complementary customers, programs and capabilities • Significantly increases content on key defense programs, e.g., E - 2D Advanced Hawkeye, F - 35, UH - 60 Blackhawk, Sikorsky CH - 53K • Broadens CPI Aero’s technical capabilities and diversifies its aerosystems assembl
Slide 12: WMI – Business Overview
WMI – Business Overview • Provider of metallurgical engineering and welding services and a manufacturer of components for various sub - sectors of the military and commercial aerospace industries • Most products are assemblies • Products deployed on a wide range of prominent military aircraft includ
Slide 13: Purchase Price, Financing and Closing
Purchase Price • Purchase price of $9.0 million in cash, plus up to an aggregate $1.0 million in cash to be paid to Air Industries if WMI enters into certain long - term supply agreements during 2018 • Earn - out payable based on WMI’s receipt of certain contract awards during 2018 Financing / Finan
Slide 14: 4Q 2017 and FY 2017 Financial Highlights, Acquisition Financing, 2018 Guidance
14 4Q 2017 and FY 2017 Financial Highlights Acquisition Financing 2018 Guidance Vincent Palazzolo Chief Financial Officer
Slide 15: Recent Financial Highlights
Recent Financial Highlights 15 For the 3M Ended December 31 , For the year Ended December 31 , 201 7 201 6 201 7 201 6 (Unaudited) (Unaudited) Revenue $ 23.8 $ 24.3 $ 81.3 $ 81.3 Cost of sales 18.3 18.4 62.6 77.0 Gross profit 5.5 5.9 18.6 4.3 Selling, general and administrative expenses 2.3 2.0 8.4
Slide 16: Balance Sheet Highlights
Balance Sheet Highlights 16 As of December 31, 2017 CEE (unbilled receivables) 111.2 Total Debt 31.9 Shareholders’ Equity 74.3 Book Value, per diluted share 8.38 Debt - to - Capital 0.43 ($ in Millions, except per share value) Liquidity • $40 million, 3 - year senior debt facility − $10 million term
Slide 17: 2018 Financial Guidance
2018 Financial Guidance 17 Revenue Pre - tax Income Effective Tax Rate • $92.0M – $96.0M • $9.1M - $9.6M • 23% - 24%
Slide 18: Q&A Session
18 Q&A Session
Slide 19: Thank You
19 Thank You CPI Aerostructures Vincent Palazzolo, Chief Financial Officer (631) 586 - 5200 www.cpiaero.com Investor Relations Sanjay M. Hurry LHA (212) 838 - 3777 cpiaero@lhai.com