Huntington Ingalls Industries, Inc. · NYSE:HII
Huntington Ingalls Industries — Q3 2024 Earnings Presentation
18 slides from Huntington Ingalls Industries's earnings presentation, Oct 31, 2024
Slide 1: HII Q3 2024 Earnings
HII Q3 2024 Earnings October 31, 2024 Chris Kastner President & CEO Tom Stiehle Executive Vice President & CFO
Slide 2: Cautionary Statement Regarding Forward-looking Statements
Cautionary Statement Regarding Forward-looking Statements Statements in this presentation, other than statements of historical fact, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking sta
Slide 3: HII Q3 2024 Operational Highlights
HII Q3 2024 Operational Highlights Ingalls Shipbuilding Highlights • Awarded a $9.6 billion multi-ship procurement contract for the construction of LPD 33, 34 and 35 and large-deck amphibious ship LHA 10 • Launched LPD 30 Harrisburg in early October Newport News Shipbuilding Highlights HII delivered
Slide 4: Mission Technologies Q3 Wins
Mission Technologies Q3 Wins • $6.7 billion contract to provide electronic warfare engineering and technical services support for the U.S. Air Force • $3 billion Federal Government task order for national security services and new and emerging technology • $458 million contract to modernize communic
Slide 5: Newport News Shipbuilding Contract Update and Operational Improvements
Newport News Shipbuilding Contract Update and Operational Improvements UPDATED FY24 • Uncertainty related to the timing and structure of the Virginia-class Block V, Block VI and Columbia-class submarine agreement with our Navy partner GUIDANCE1 • Confident an agreement will be reached and discussion
Slide 6: HII Q3 2024 Consolidated Results
HII Q3 2024 Consolidated Results CONSOLIDATED REVENUE ($M) OPERATING INCOME ($M) & MARGIN % $3,000 $2,816 $200 $2,749 $180 $172 $2,500 $160 $140 $2,000 $120 6.1% $1,500 $100 $82 $80 $1,000 $60 $40 3.0% $500 $20 $0 $0 Q323 Q324 Q323 Q324 5.6% • Revenue declined $67M or 2.4% • Operating income decreas
Slide 7: HII Q3 2024 Segment Results YoY
HII Q3 2024 Segment Results YoY Ingalls Shipbuilding REVENUE ($M) SEGMENT OPERATING INCOME1 ($M) Revenue & MARGIN %1 $73 - Amphibious assault ships and National Security $800 $711 $664 $80 _Cutter volumes $600 $60 $49 + Surface combatant volume $400 $40 10.3% 7.4% Operating Income $200 $20 - Lower a
Slide 8: HII Q3 2024 Capital Deployment
HII Q3 2024 Capital Deployment CASH FLOW GENERATION ($M) SHAREHOLDER DISTRIBUTIONS ($M) $400 $100 TOTAL $335 $87 $350 $90 $293 TOTAL $300 $80 $71 $250 $213 $70 $35 $62 $200 $60 $21 $136 $50 $150 $100 $40 $9 $50 $30 $0 $20 $52 $50 $10 $49 ($50) ($42) $0 ($100) ($77) Q3 23 Q3 24 Q3 23 Q3 24 Cash from
Slide 9: HII Financial Outlook
HII Financial Outlook1 Prior FY24 Outlook Current FY24 Outlook1 Shipbuilding Revenue2 $8.8B - $9.1B ~$8.8B Shipbuilding Operating Margin2 7.6% - 7.8% 5.0% - 6.0% Mission Technologies Revenue $2.75B - $2.8B $2.8B - $2.85B Mission Technologies Segment Operating Margin2 3.0% - 3.5% ~3.75% Mission Techn
Slide 10: Appendix
Appendix
Slide 11: Non-GAAP Information
Non-GAAP Information We make reference to “free cash flow,” “segment operating income,” “segment operating margin,” “shipbuilding revenue,” “shipbuilding operating margin,” “Mission Technologies EBITDA” and “Mission Technologies EBITDA margin.” We internally manage our operations by reference to seg
Slide 12: Non-GAAP Measures Definitions
Non-GAAP Measures Definitions Segment operating income is defined as operating income for the relevant segment(s) before the Operating FAS/CAS Adjustment and non-current state income taxes. Segment operating margin is defined as segment operating income as a percentage of sales and service revenues.
Slide 13: Non-GAAP Reconciliations: Segment Operating Income & Segment Operating Margin
Non-GAAP Reconciliations Segment Operating Income & Segment Operating Margin Three Months Ended Nine Months Ended September 30 September 30 ($ in millions) 2024 2023 2024 2023 Ingalls revenues 664 711 2,031 1,952 Newport News revenues 1,412 1,453 4,381 4,468 Mission Technologies revenues 709 685 2,2
Slide 14: Non-GAAP Reconciliations: Shipbuilding Revenue & Operating Margin
Non-GAAP Reconciliations Shipbuilding Revenue & Operating Margin Three Months Ended Nine Months Ended September 30 September 30 ($ in millions) 2024 2023 2024 2023 Sales and service revenues 2,749 2,816 8,531 8,277 Mission Technologies revenues (709) (685) (2,224) (1,954) Intersegment eliminations 3
Slide 15: Non-GAAP Reconciliations: Free Cash Flow
Non-GAAP Reconciliations Free Cash Flow Three Months Ended Nine Months Ended September 30 September 30 ($ in millions) 2024 2023 2024 2023 Net cash provided by operating activities 213 335 2 408 Less capital expenditures: Capital expenditure additions (88) (53) (253) (164) Grant proceeds for capital
Slide 16: Non-GAAP Reconciliations: Mission Technologies EBITDA & EBITDA Margin
Non-GAAP Reconciliations Mission Technologies EBITDA & EBITDA Margin Three Months Ended Nine Months Ended September 30 September 30 (in millions) 2024 2023 2024 2023 Mission Technologies sales and service revenues 709 685 2,224 1,954 Mission Technologies segment operating income 33 24 97 50 Mission
Slide 17: Pension Outlook
Pension Outlook ($ in millions) 2023 (Actual) 20243 20253 Pension Discount Rate 5.47% 5.28% 5.47% Change from prior est. N/A Change from prior est. +19Bps Expected Long-Term Return on Assets 8.00% 8.00% 8.00% N/A N/A Actual return on Assets 12.3% 10.0%4 10.0%4 CAS Recoveries Over Cash Contributions1
Slide 18: Slide 18
Huntington Ingalls Industries — Q3 2024 Earnings Presentation on 6ix