Slide 1: Third Quarter FY2024 Teleconference
Graham Corporation Third Quarter FY2024 Teleconference February 5, 2024 Daniel J. Thoren, President and Chief Executive Officer Christopher J. Thome, Vice President - Finance and Chief Financial Officer www.GrahamCorp.com
Slide 2: Safe Harbor Statement
Safe Harbor Statement Safe Harbor Regarding Forward Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are
Slide 3: Effectiveness of Strategy Reflected in Strong Q3 Results
Effectiveness of Strategy Reflected in Strong Q3 Results (All comparisons are with the same prior-year period) Revenue Gross Margin Record Orders(1) $43.8M +10% 22.2% +660 bps $123.3M • Defense projects • Favorable mix and better pricing • Reflects repeat orders for critical • Strong aftermarket sal
Slide 4: P3 Technologies: Adds differentiated propulsion, power, fluid flow technologies
P3 Technologies: Adds differentiated propulsion, power, fluid flow technologies Investment Highlights and Strategic Rationale Expect growth synergy opportunities by augmenting turbomachinery 1 technologies, engineering team and manufacturing capabilities Established 2017; Jupiter, FL Advances strate
Slide 5: Strong Margin Expansion on Revenue Growth
Strong Margin Expansion on Revenue Growth ($ in millions) SALES GROSS PROFIT & MARGIN $47.6 $45.1 $11.0 $43.0 $43.8 $39.9 $9.7 $7.2 $7.2 $6.2 15.6% 16.6% 23.1% 16.0% 22.2% Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Sales increased $3.9 million, or 10% y/y Gross p
Slide 6: Improved Earnings Power
Improved Earnings Power ($ in millions, except per share data) NET INCOME PER DILUTED SHARE AND ADJUSTED EBITDA AND MARGIN(1) ADJUSTED NET INCOME PER DILUTED SHARE(1) $5.6 Net Income per diluted share Adjusted Net Income per diluted share $0.33 $3.9 $0.25 $0.22 $2.7 $0.13 $2.2 $0.08 $0.03 $0.04 6.7%
Slide 7: Cash Generation Enabled Debt Paydown and Strategic Investments
Cash Generation Enabled Debt Paydown and Strategic Investments ($ in millions) CAPITALIZATION Refinanced debt with a new, five-year up to $50 million senior secured revolving credit December 31, March 31, facility 2023 2023 Cash and cash equivalents $15.2 $18.3 • Provides flexibility with reduced bo
Slide 8: Record Follow-on Orders for Critical U.S. Navy Programs
Record Follow-on Orders for Critical U.S. Navy Programs ($ in millions) QUARTERLY ORDER (1) TREND Q3 FY24 ORDERS (1): $123.3 MILLION $123.3 $20.1 Space 5% $67.9 Chem/Petrochem 5% $50.8 $103.2 $34.9 $36.5 Refining 4% $22.8 $15.6 $20.0 $33.0 Other 2% $12.3 $28.0 $20.8 $7.8 Defense Q3 FY23 Q4 FY23 Q1 F
Slide 9: Record Backlog of nearly $400 Million Provides Visibility and Stability
Record Backlog of nearly $400 Million Provides Visibility and Stability ($ in millions) TOTAL BACKLOG(1) Q3 FY24 BACKLOG(1) : BY INDUSTRY $399.2 Refining $64.7 7% $322.0 $313.3 $301.7 Chem/ Petrochem 4% $293.7 $68.6 $62.6 Defense Space 3% $58.1 84% $59.2 Other 2% $334.5 $243.6 $253.4 $250.7 $234.5 •
Slide 10: Increased Fiscal 2024 Revenue and Adjusted EBITDA Outlook
Increased Fiscal 2024 Revenue and Adjusted EBITDA Outlook(1) Revenue: $175 million to $185 million FY24 Guidance(1) • Implies ~15% revenue growth at midpoint of range Gross margin: ~20% • Implies ~9% adjusted EBITDA margin(3) at midpoint of range SG&A(2) (includes amortization): ~16% to 17% of sales
Slide 11: Building a Better Business: Plan Delivers Compounding Growth
Building a Better Business: Plan Delivers Compounding Growth Growing backlog with stronger margins Winning new business with better pricing Improving execution reduces costs and drives productivity Established strategic supplier to U.S. Navy with a variety of solutions Focused on growth both organic
Slide 12: Supplemental Information
=6HM SUPPLEMENTAL INFORMATION
Slide 13: Disclaimer Regarding Key Performance Metrics
Disclaimer Regarding Key Performance Metrics Key Performance Indicators In addition to the foregoing non-GAAP measures, management uses the following key performance metrics to analyze and measure the Company’s financial performance and results of operations: orders, backlog, and book-to-bill ratio.
Slide 14: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Three Months Ended Nine Months Ended Non-GAAP Financial Measure: December 31, December 31, (1) Adjusted EBITDA is defined as consolidated net 2023 2022 2023 2022 income (loss) before net interest expense, income taxes, depreciation, amortization, other acquisition rela
Slide 15: Adjusted Net Income and Adjusted Diluted EPS Reconciliation
Adjusted Net Income and Adjusted Diluted EPS Reconciliation Three Months Ended Nine Months Ended December 31, December 31, Non-GAAP Financial Measure: 2023 2022 2023 2022 (1) Applies a normalized tax rate to non-GAAP adjustments, Net income $ 165 $ 368 $ 3,216 $ 848 which are pre-tax, based upon the
Slide 16: Third Quarter FY2024 Teleconference
Graham Corporation Third Quarter FY2024 Teleconference February 5, 2024 Daniel J. Thoren, President and Chief Executive Officer Christopher J. Thome, Vice President - Finance and Chief Financial Officer www.GrahamCorp.com