Slide 1: Second Quarter 2022 Results Conference Call
Second Quarter 2022 Results Conference Call July 2022
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
R A I S E T H E B A R 2 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 of the Exchange A
Slide 3: Executive Summary
R A I S E T H E B A R 3 EXECUTIVE SUMMARY Generated Y/Y Growth in Revenue & Adjusted Net Income • Total revenue +38% Y/Y; Revenue growth in all segments • $1.9M Y/Y growth in adjusted net income Aviation Supported by Strong Growth Across Distribution & Repair • Revenue +121% Y/Y to a record $105 mil
Slide 4: VSE Financial Summary
R A I S E T H E B A R • Revenue +38%, with growth in all business segments driven by strong demand and execution: Aviation +121%, Fleet +12%, Federal & Defense +3% • Adjusted EBITDA increased +21% as both organic and inorganic revenue growth in Aviation and strong demand in Fleet commercial sales we
Slide 5: Consolidated Performance Bridge
R A I S E T H E B A R 5 CONSOLIDATED PERFORMANCE BRIDGE Y/Y comparisons: • Aviation segment revenue and profit increased; 8th consecutive quarter of segment revenue growth • Fleet segment revenue and EBITDA growth supported by higher sales in commercial fleet and e-commerce fulfillment, offset by ex
Slide 6: Aviation Segment
R A I S E T H E B A R 6 AVIATION SEGMENT ($ in millions) Quarter-to-Date 2Q'22 2Q'21 vs. 2Q'21 Revenue $105.0 $47.5 +121% Adjusted EBITDA $11.9 $4.0 +198% Adjusted EBITDA % 11.4% 8.4% +2.9 pts Operating income (loss) $6.5 $(22.3) NM(1) Revenue by Type: Distribution $79.1 $28.5 +177% Repair $26.0 $19
Slide 7: Fleet Segment
R A I S E T H E B A R 7 FLEET SEGMENT ($ in millions) Quarter-to-Date 2Q'22 2Q'21 vs 2Q’21 Revenue $64.7 $58.1 +12% Adjusted EBITDA $7.7 $7.0 +10% Adjusted EBITDA % 12.0% 12.1% (0.1) pts Operating income (loss) $5.4 $4.0 +34% Revenue by Type: Other Government $37.5 $35.8 +5% DoD $1.3 $4.7 (73)% Comm
Slide 8: Federal & Defense Segment
R A I S E T H E B A R 8 FEDERAL & DEFENSE SEGMENT ($ in millions) Quarter-to-Date 2Q'22 2Q'21 vs 2Q’21 Revenue $72.0 $69.5 +3% Adjusted EBITDA $3.4 $8.1 (58)% Adjusted EBITDA % 4.8% 11.7% (6.9)pts Operating income (loss) $2.6 $7.0 (64)% Contract Backlog: Bookings $63 $107 (41)% Backlog $183 $224 (18
Slide 9: Balance Sheet Optionality
R A I S E T H E B A R • Sufficient liquidity of $91M cash and unused commitment availability under $350M revolving credit facility (due 2024) to support growth initiatives • Net Debt increased in 2Q’22 with $(3.4M) free cash flow driven by completion timing of purchases to support 2022 sales of new
Slide 10: Appendix
0, VY APPENDIX CORPORATION
Slide 11: GAAP to Non-GAAP Reconciliations: Adjusted Net Income and Adjusted EPS
R A I S E T H E B A R 11 GAAP TO NON-GAAP RECONCILIATIONS Adjusted Net Income and Adjusted EPS (Diluted) Calculation uses an estimated statutory tax rate on non-GAAP tax deductible adjustments. (in thousands, except per share data) 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 2Q2022 Net income (loss) $ 5,111
Slide 12: GAAP to Non-GAAP Reconciliations: EBITDA and Adjusted EBITDA
R A I S E T H E B A R 12 GAAP TO NON-GAAP RECONCILIATIONS EBITDA and Adjusted EBITDA (in thousands, except per share data) 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 2Q2022 Net income (loss) $ 5,111 $ (12,366) $ 9,021 $ 6,200 $ 6,244 $ 7,548 Interest expense, net 3,030 2,666 2,780 3,593 3,609 3,872 Income t
Slide 13: GAAP to Non-GAAP Reconciliations: Segment EBITDA and Adjusted EBITDA
R A I S E T H E B A R 13 GAAP TO NON-GAAP RECONCILIATIONS Segment EBITDA and Adjusted EBITDA (in thousands) 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 2Q2022 Aviation Operating income (loss) $ (332) $ (22,272) $ 3,719 $ 4,512 $ 7,622 $ 6,450 Depreciation and amortization 2,554 2,554 3,062 2,898 3,035 3,110
Slide 14: GAAP to Non-GAAP Reconciliations: Balance Sheet
R A I S E T H E B A R 14 GAAP TO NON-GAAP RECONCILIATIONS Balance Sheet (1) TTM Adjusted EBITDA is defined as Adjusted EBITDA for the most recent twelve (12) month period Reconciliation of Operating Cash Flow to Free Cash Flows Three Months Ended (in thousands) 31-Mar-21 30-Jun-21 30-Sep-21 31-Dec-2
Slide 15: Investment Highlights
R A I S E T H E B A R 15 INVESTMENT HIGHLIGHTS 3 Distinct End Markets $35M Adj. Net Income ~2,000 Employees $884M Revenue 63+ Years Aftermarket Services Pure-play independent aftermarket service provider with strong organic & inorganic growth opportunities $84M Adj. EBITDA Global provider of afterma
Slide 16: VSE Senior Leadership
R A I S E T H E B A R VSE Senior Leadership 16 VSE EXECUTIVE TEAM John Cuomo President and CEO • 21+ years of aerospace distribution and services market industry experience • Appointed Chief Executive Officer and President of VSE Corporation in 2019 • Previously served as Vice President and General
Slide 17: Aviation Segment Overview
R A I S E T H E B A R Representative Customers 17 AVIATION SEGMENT OVERVIEW MRO Capability Development • New MRO offerings to support range of components and engine accessory repairs including: fuel and hydraulics, engine components and accessories, interiors, auxiliary power units, and avionics Dis
Slide 18: Fleet Segment Overview
R A I S E T H E B A R 18 FLEET SEGMENT OVERVIEW Commercial Customer Diversification • Expansion of commercial customer base to support new medium to large, high-duty cycle fleet customers Wallet Share Expansion • Product expansion to existing just-in-time clients E-commerce • Customized technology p
Slide 19: Federal & Defense Segment Overview
R A I S E T H E B A R 19 FEDERAL & DEFENSE SEGMENT OVERVIEW Market Expansion • Increase military aviation services with products, supply chain and repair services Capability Development • Broaden DoD logistics and supply chain offering to support underserved market demand International Growth • Util
Slide 20: Unique Value Proposition
R A I S E T H E B A R 20 UNIQUE VALUE PROPOSITION Differentiation drives market share gains, long-term sustainable revenue & margin expansion End-User and OEM-Centric Ability to offer bespoke solutions to support critical link between end-users and Original Equipment Manufacturers (“OEMs”) Agility L
Slide 21: Investment Opportunity
R A I S E T H E B A R 21 INVESTMENT OPPORTUNITY Unique, pure-play independent aftermarket services company poised for growth Strategic Market Positioning, Strong Growth Strategy, Proven Execution Experience MISSION-CRITICAL AFTERMARKET SERVICES CULTURAL TRANSFORMATION DRIVING GROWTH STRONG CUSTOMER