Kaman (KAMN) 8-K Regulation FD Disclosure

Appendix I

Non-GAAP Reconciliations

2

Adjusted EBITDA

Adjusted EBITDA - Adjusted EBITDA is defined as operating income before depreciation and amortization.
Adjusted EBITDA is calculated on our consolidated results as well as the results of our reportable segments.
Adjusted EBITDA differs from Segment Operating Income, as calculated in accordance with GAAP, in that it
excludes depreciation and amortization. We have made numerous investments in our business, such as
acquisitions and increased capital expenditures, including facility improvements, new machinery and equipment,
improvements to our information technology infrastructure and new ERP systems. Management believes Adjusted
EBITDA provides an additional perspective on the operating results of the organization and earnings capacity and
helps improve the comparability of our results between periods by eliminating the impact of non-cash
depreciation and amortization expense. Adjusted EBITDA does not give effect to cash used for debt service
requirements and thus does not reflectavailable funds for distributions, reinvestment or other discretionary uses.
Adjusted EBITDA is not presented as an alternative measure of operating results or cash flows from operations, as
determined in accordance with GAAP.

3

Adjusted EBITDA

4

Free Cash Flow

Free Cash Flow - Free cash flow is defined as GAAP “Net cash provided by (used in) operating activities” less
“Expenditures for property, plant & equipment.” Management believes free cash flow provides an important
perspective on the cash available for dividends to shareholders, debt repayment, and acquisitions after making
capital investments required to support ongoing business operations and long-term value creation. Free cash
flow does not represent the residual cash flow available for discretionary expenditures as it excludes certain
mandatory expenditures such as repayment of maturing debt. Management uses free cash flow internally to
assess both business performance and overall liquidity. The following table illustrates the calculation of free cash
flow using “Net cash provided by (used in) operating activities” and “Expenditures for property, plant &
equipment”, GAAP measures from the Consolidated Statements of Cash Flows included in this release.

5

Organic Sales Growth

Organic Sales- Organic sales is defined as GAAP net sales less sales derived from acquisitions. Management
believes organic sales provides an important perspective on the underlying performance of our operations.