1
Financial Overview
Robert Starr
2
Long-Term Financial Goals
Deliver strong sales growth through organic initiatives and acquisitions | ||
Expand Adj. EBITDA* margins | ||
Generate free cash flow* - Between 80-100% of net income | ||
Provide strong investor returns | ||
3
Historical Financial Results
in million $, except EPS
in million $, except EPS
223%
96%
38%
84%
4
2014 Financial Performance / Outlook
H1 2013 | H1 2014 | 2014 Outlook | |
Kaman Distribution Group - Sales - Operating Margin | $527 M 3.5% | $569 M 4.7% | $1,190 - $1,220 M 4.8% - 5.2% |
Kaman Aerospace Group - Sales - Operating Margin | $292 M 17.0% | $304 M 16.0% | $640 - $660 M 16.5% - 16.7% |
Corporate Expense | $23 M | $26 M | $52 M ┼ |
Interest Expense | $6 M | $6 M | $14 M |
Tax Rate | 34.4% | 33.8% | 35.0% |
Capital Expenditures | $21 M | $18 M | $30 - $35 M |
Free Cash Flow* | $(35) M | $(6) M | $50 - $55 M ┼ |
┼ Excludes costs associated with the disposition of idled Moosup facility
5
Five Year Financial Targets
o 3% - 6% organic sales
growth*
growth*
o 3% - 10% including
acquisitions
acquisitions
o High-teens operating
margin %
margin %
6
Scale
Kaman Distribution - Road to 7+% Operating Margin
TODAY
5%
FUTURE
7+%
Improved Operational
Efficiencies
Efficiencies
Product Mix
Strategic Pricing
CATALYSTS
7
Provide the financial
capacity to support
Kaman strategic goals
while appropriately
managing our
financial risk
capacity to support
Kaman strategic goals
while appropriately
managing our
financial risk
Target range for
Debt / EBITDA♯
of 2-3 x over the
business cycle
business cycle
♯As defined per the Credit Agreement
8
Capital Deployment Framework
Capital deployment is focused on growth investments &
return of capital to shareholders
return of capital to shareholders
Period: 2007-H1 2014
9
Recent Acquisitions
10
Increased capital expenditures to support growth
& improved profitability
& improved profitability
Capital Expenditures
Facilities and Equipment
New Aerospace Programs
Information Technology &
ERP Systems
ERP Systems
11
Dividend Philosophy
Annual Dividends Per Share
44 years
uninterrupted dividend
payments
uninterrupted dividend
payments
Maintain competitive
dividend yield with
peer group
dividend yield with
peer group
