Slide 1: Third Quarter 2024 Results Conference Call
Third Quarter 2024 Results Conference Call November 6, 2024 vsecorp.com
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Introduction Forward-Looking Statements This presentation contains statements that, to the extent they are not recitations of historical fact, constitute "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E o
Slide 3: Strategic Update: A Year of Repositioning and Focused Execution
VSE Corporation Strategic Update: A Year of Repositioning and Focused Execution Kellstrom Aerospace Acquisition Aviation Fleet ▪ Announcement: October 2024, VSE ▪ European Distribution Expansion: ▪ Support USPS, following their transition to announced it signed a definitive agreement ▪ Pratt Whitney
Slide 4: Q3 2024 Business Segment Update
VSE Corporation Q3 2024 Business Segment Update Aviation Fleet +34% Revenue Growth (11)% Revenue Decline • Record quarterly sales driven by solid execution • Revenue decline driven by lower USPS maintenance across both revenue channels (distribution and MRO) activity, partially offset by growth in e
Slide 5: VSE Financial Summary
VSE Corporation VSE Financial Summary Revenue Quarter-to-Date Year-to-Date ▪ Aviation +34% and Fleet (11)% 3Q'24 3Q’23 vs. 3Q'24 3Q’23 vs. ▪ Aviation: Record revenue and Adjusted ($ in millions except EPS) 3Q’23 3Q’23 EBITDA driven by strong execution on new and existing distribution programs, Reven
Slide 6: Consolidated Performance Bridge
VSE Corporation Consolidated Performance Bridge Operating Adj. Adj. Revenue Income EBITDA EBITDA Margin % 3Q’23 QTD $231.4 $25.3 $32.3 14.0% ▪ Aviation segment revenue and profit growth supported Aviation +51.2 +4.4 +7.3 +0.1 pts by strong program execution on distribution programs, Fleet (9.0) (6.0
Slide 7: Aviation Segment
Aviation Segment Aviation Segment Y/Y Comparisons: Quarter-to-Date Year-to-Date ▪ Revenue +34% to a record $204M in 3Q’24 vs. the prior-year period, driven by strong 3Q'24 3Q'23 vs. 3Q'23 3Q'24 3Q'23 vs. 3Q'23 execution on new and existing distribution ($ in millions) programs, an expanded portfolio
Slide 8: Fleet Segment
Fleet Segment Fleet Segment Quarter-to-Date Year-to-Date Y/Y Comparisons: ▪ Revenue decreased (11)% to $70M in 3Q’24 ($ in millions) 3Q'24 3Q'23 vs 3Q’23 3Q'24 3Q'23 vs 3Q’23 vs. the prior-year period, driven by a decrease in USPS repair activity, partially Revenue $70.0 $79.0 (11)% $222.3 $234.8 (5
Slide 9: Balance Sheet Optionality
Balance Sheet Balance Sheet Optionality Quarter-to-Date 3Q’24 2Q’24 1Q’24 ▪ Generated $4M of free cash flow in 3Q’24 ($ in millions) Operating Cash ▪ Adjusted Net Leverage Ratio is 3.3x as of 3Q’24 $10 $(18) $(79) Flow ▪ Adjusted for the Kellstrom acquisition and the October equity raise, 3Q’24 Adju
Slide 10: 2024 Priorities to Growth and Accelerate Transformation Strategy
2024 Priorities 2024 Priorities to Growth and Accelerate Transformation Strategy > European Expansion: Pratt & Whitney EMEA Program and Product Line Expansion Implementations > OEM Licensed Manufacturing Program Launch and Implementation Aviation Segment > Desser Distribution and MRO Integrations >
Slide 11: Appendix
Appendix vsecorp.com
Slide 12: GAAP to Non-GAAP Reconciliations
Appendix GAAP to Non-GAAP Reconciliations EBITDA and Adjusted EBITDA ($ in thousands, except per share data) Three months ended September 30, Nine months ended September 30, 2024 2023 % Change 2024 2023 % Change Net income (loss) $ 11,650 $ 12,111 (3.8)% $ 20,973 $ 30,318 (30.8)% Interest expense, n
Slide 13: GAAP to Non-GAAP Reconciliations
Appendix GAAP to Non-GAAP Reconciliations Adjusted Net Income and Adjusted EPS (Diluted) Three months ended September 30, Nine months ended September 30, ($ in thousands, except per share data) 2024 2023 % Change 2024 2023 % Change Net (loss) Income from continuing operations $ 11,650 $ 12,111 (3.8)
Slide 14: GAAP to Non-GAAP Reconciliations
Appendix GAAP to Non-GAAP Reconciliations Segment EBITDA and Adjusted EBITDA Three months ended September 30, Nine months ended September 30, ($ in thousands) 2024 2023 % Change 2024 2023 % Change Aviation Operating income $ 25,435 $ 20,951 21.4% $ 72,214 $ 52,397 37.8% Depreciation and amortization
Slide 15: GAAP to Non-GAAP Reconciliations
Appendix GAAP to Non-GAAP Reconciliations Balance Sheet Reconciliation of Operating Cash Flow to Free Cash Flows ($ in thousands) September 30, 2024 June 30, 2024 March 31, 2024 Net cash (used in) provided by operating activities $10,176 $(17,528) $(79,060) Capital expenditures (5,765) (3,945) (7,72