BWXT - Earnings call transcript Q1 2024

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Operator

Ladies and gentlemen, welcome to the BWX Technologies First Quarter 2024 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to our host, Chase Jacobson of BWXT's Vice President of Investor Relations. Please go ahead.

Chase Jacobson

Thank you, Kathleen. Good evening, and welcome to today's call.

Geveden, and CEO; CFO. Rex Senior Robb are President Vice me President and and LeMasters, Joining the the On first presentation on quarter call, XXXX section today's we earnings that will is website. BWXT reference the Investors of available

constitute investor We statements statements. company's materials those in and involve matters provision harbor filings. including These the uncertainties, the forward-looking safe will and found certain also described discuss that risks in SEC the

the in earnings measures financial that which reconciled the non-GAAP appendix on discuss measures of I would found of frequently will be turn now We section like Rex. to the presentation over website. to can are Investors to GAAP the call the BWXT

Rex Geveden

We seasonal earnings flow, historical reaffirming compared line all our share earnings and per and are expectations, Thank you. BWXT to we cash performance This delivered you, per $X.XX. we remarkably revenue revenue to good afternoon, results. mid-single-digit adjusted the X% adjusted X% and growth, share year and Chase, organic evening for growth in patterns. of adjusted Operating to of $X.XX calling leading reported growth EBITDA to quarter good full with our was guidance, first

into our plant, North spend like discussion, segment few minutes heavy nuclear the a largest America's on get I'd which facility. I recent Before expand the to already announcement to Cambridge is manufacturing equipment

in of for project the increase commercial manufacturing reactors it in potential and $XXX we extensions of builds by markets footprint and forward existing is this the commercial small moving Cambridge equipment. and nuclear and market. upgrade backlog to As CANDU demand facility with a for are demand incipient we robust With our and on advanced modular the recent reactors. new with life million, with discussed new ongoing over tangible future the large XX% calls, nuclear demand The Canada international

completion in will quarter years, this mid-XXXX. X planned next we the third million invest of starting year construction $XX in and the about Over with

would Microreactors is in investment signal projects. of exciting Supply energy that capacity and customers they enables more the Propulsion, BWRX-XXX ahead supply recent business just and is Vernova in clean the I execution enables as more new this the compete vein, expanded and Medical projects, company get add precipitating with qualified our This strength and growth much intention efficient that is backlog smaller existing Naval also GE and first did to just years. for we market demand our that of our last chain BWXT while the we know secure that Group. in to room announced week, for as Chain scale, In

and standards credentials require delivery on-time products that market-leading making we the high-quality meaningful be right ready at meet time investments customers with to Our satisfy with now, demand the extremely by will capacity.

discussions engaged value this others making in to couple with investment, visiting appropriate Before be road personally customers of top the to for generate with over next commitment our to returns provide. underscore our and months, the need industry we and the BWXT's will I'm on the

an occupy world-class and enviable qualifications. position experiential will workforce As BWXT given capacity inevitably tightens, its facilities

of segment market to results turning discussion the Now a outlook. and

a Government the in demand like growth a X% perspective, nicely Operations grow areas. From touch to I organic continue to quarter. with on would of revenue couple key

programs appropriations high delayed across provided a good XXXX fiscal our the and Government long Operations. at First, funding level, all

plan sustain industrial the The for request year fiscal base the and namely Program and prioritizes modernization this Looking shipbuilding the themes, President's 'XX Competition prepare underpin supports Submarine substantial BWXT's long-term Great Class office. secular growth the the and budget of in story. Power Decarbonization year, Columbia provide that beyond Global the submarine to investment

and energy, President. The in including billion the was investments which just supports This advanced clean and technology growth in ] signed in and is funds] the markets. bill supplemental $X.X 'XX in [fully specifically, a DARPA Defense [ complex the was at the which in thermal micro nuclear Dreco rocket engine for space, More that hardware with by project, manufacturing reactor of is further program request coated reactor the modular BWXT small development, NASA supported important fuel. a FY first nuclear demonstration

Virginia shipbuilding there's year new our Second, shipyards class will facilities. in BWXT two the that the could delays, made Navy work we delays recent XX-year significant remind of address a at workload been shipbuilding concurrent in orders around in early procurement handle lot with news plan. to U.S. reflected orders Navy's shipbuilding carrier investments per and you ramp the ensure changes Columbia associated in schedules class To with flow serial and through the the I going

schedules. part, navigated to labor have work most post-COVID. our the pressures the trade-offs varied somewhat supply continue with issues delays. vigilant tighter of since at execution and during plan updated the as successfully The [ months decoupled ensure ] chain shipyards and Cs the some spoke just reflects For the Accordingly, to our are released ago, Navy remain from times That Day said, priorities. we shipbuilding last X customers stability of with over to we we Investor and and XX-year we mid -- shipbuilding in

carrier and adjustment the to is class of to scale for class given potential meaningful that reactor Ford would not of more But backlog quantities. particularly the work. Navy's BWXT plans Virginia impactful the schedule because aircraft the be While our mixed, are

XXXX new be starting in XXXX procurement in According procured to than CVN will plan, rather rather than XXXX. this XXXX in with advanced XX

year. be 'XX and could BWXT, could extended low this For mean carrier that the another in 'XX

to In procurement Components As with programs. the Naval for class aim submarines. of serial our case, this demand Columbia we other any with and we Propulsion, class [indiscernible] visibility submarines production will potentially are remains Work Virginia Reactors, into cadence extended clear in of and offset Fuel doing XXXX, steady

work work. early, to scope extended increased funding support BWXT possible related facilitization architectural get activity. is including August Additionally, -- potential [indiscernible] for to it received workload still work has use on future Navy an initial that lull while demand, could and engineering carrier ahead

believe While business the set for that cadence XX-year orders year-to-year, to Day Investor of growth at specific laid X% from Propulsion remains the we compound shift any Naval rate of we achievable. X% on ship our out could

nation fleet is the various imperative. security to and changes committed The goals Washington the national supplanted long-term for or under have doubtlessly historically nuclear other administrations its dynamics not

ultimately for in Our developing National nicely. we microreactor phase, and is working finalize office, received and projects highlighting worth as advantage progressing including in radars the requirements It Pele and procurement the full request support critical for one XXXX Lab, strategic increasing the vehicles for we system. fiscal Micro DOE noting funding are to Terrestrial and needed the due the operation needs that capabilities strategic of military the authorization high-powered for that with stable alongside sea the to of applications, are could defense for Pele, technology, Reactor tactical government military both land Idaho for basis Project the power is the remote are and and the a licensing serve bill, electrification at the this basis weapons.

while in to a its and was ramping quarter. growth the nicely Similarly, DRACO was early revenue key contributor in stages,

its build Nuclear with our provides Space Rolls-Royce we allies Beyond Space Power U.K. advanced teaming small their secured Agency expanding in other U.S. for domain. teaming capabilities recently modular franchise beyond into including space, for Missions. contract our which nuclear component This microreactor agreement reactor fuel collaboration applications, and and a and development. the on We this DRACO, continue space through presence expand to agreement and to nuclear increasingly and technologies entered we invest in as a

markets. While strategy the to our microreactor is continue in focused defense on commercial applications, primarily we assess opportunities

of nuclear reactors as along history materialize. and our manufacturing expertise significant dedicated opportunities with us well technical the manufacturing Our footprint, Navy, for position commercial

the In and capabilities accountability. deep scrap in Earlier announced multiyear recycled into we've radiochemical the integrated conversion we Contract to protests re-award our Tank joint venture. captured were a DOE. on And enriched Security incumbent, of venture from year, this XX-year of contract when X-year success National purification our XXXX strengths the a material Downblending Materials, assay, X-year to contract the portfolio technical Disposition the this was [indiscernible] a and by Hanford and DOE by first the to the a XXXX. low processing, April in BWXT-led high In BWXT-led based building after uranium joint Special awarded contract extension Complex decided a contract and we contract assembled uranium. a awarded March, handling We on multiple

evidenced While as it is superior again selected being protested, we by our delivered twice. a proposal being

favor, Assuming contract it transition this settles expect year. our in later we the

by encouraged demand, remain focused our operations. are market keenly While on also we we improving

way of of tasked doubled this As improved focus program across requires In and with workforce we've a to to our business. and of as metrics is our quarter, first immense drilling, is before, investments benefits offset improving saw on drive made [indiscernible] sites. our in the helping precision, efficiency we how work to This I process track. our key one the profitability just By nearly team OpEx discussed efficiency continue operational equipment impacts effectiveness the significant inflationary example realize we example, of the facilities.

our Commercial segment. Turning Operations now to

in and medical driven trend, demand XX%. growth Continuing recent the by in Revenue EBITDA was increasing contribution. a the segment isotopes grew EBITDA improved for quarter medical and X% adjusted up was

life announced described growing is a commercial and a the OPG in for full into proceed power the In North project the on release that our Pressure As that January, remains and Hitachi years extension substantial as more working we site Ontario XXXX. earlier set backlog X GE At the drive visibility of in began growth region of Pickering backlog life anticipate is with consider in America the in This of end SMR award I building for the BWXT will formally or call, work SMRs opportunity Generation are BWRX-XXX of demand. Reactor and market manufacturing provide Vessel to strong. revenue the through with extension months. electricity X. opportunity with utilities meet will market, that and in in enticing of another And Europe demand XX nuclear Power units that coming it the our the

as I improves nuclear position our that of in equipment Cambridge at expansion America. The supplier North earlier large preeminent the described

Turning base drug from manufacturing grew on the rapidly, last to BWXT Medical. momentum expansion. with building and diagnostics Revenue year contract

with rapid revenue for Demand development Therapeutic the announcement XX%. leader therapeutic Fusion space expect to diagnostic about Isotopes in Pharmaceuticals billion. of to a continued year full continue $X.X BWXT of Medical and growth AstraZeneca's a acquire and up Actinium-based of for We is partner key to increasing consolidation drug and

data radiopharmaceuticals clinical in these addressable There for trials points growth market. We continue using Actinium isotopes. are drugs clinical positive see significant lutetium and active trials, as over XXX driving the to various advance through

already to have that drugs evolving Some proven successful. be

$X billion the seek announced patient open will for growth market. post-chemotherapy set, the drug of use For Pluvicto only settings is larger annual it cancer significantly highlighting approval would over and in example, market-leading Pluvicto the Novartis that prostate Approval for recently setting. in meaningful this approved sales with lutetium-based currently potential is pre-chemotherapy a

supplier are lutetium currently finalize trials the non-carrier-added to drug our the and year and multiple commercial We of file are ramp only Actinium significantly as master we clinical next commercial sales of plan FDA. supporting with

had positions in multiple and our of guidance. we is reaffirming forefront overall, are occupying the quarter nuclear markets. the XXXX a competitive So at industry good BWXT meaningful

tailwinds We variability. secular are near-term portfolio withstand and over the a demand long funding that term experiencing and can

a these investments. manufacturing, processing services have are world-class unique in workforce, infrastructure highly We enhancing and capabilities credentialed and experienced organic with and

us and to other critical missions the now Rob. security, financial our global to to medium-term to targets. that, address We turn nuclear are well will our customers With oncology I call over positioning energy providing clean nuclear in applications, committed interventional solutions achieve

Robb LeMasters

start Thanks, Slide Rex, and on highlights of financial I'll good total some with X evening, the everyone. earnings presentation. company

over a costs offset million, to health partially slightly Commercial Government segments. quarter more costs up on expected was lower organically Operations lower $XXX in was level corporate in several EBITDA. the costs to lower to corporate were growth the next and the both normalized up The million, X% as a timing mainly return due revenue first quarters. with Operations care-related EBITDA growth quarter consolidated by of $XXX First year-over-year are and X% similar basis, Adjusted in were

in year flat We year lower at unallocated the per EBITDA XXXX. prior Adjusted up see corporate share slightly was $X.XX full than earnings continue to quarter. to $X.XX, X% to compared

and $X.XX EPS As see remainder with in you interest lower year-over-year slightly about X, between a on growth, pension lower the can higher the expense contributed rate. Operations the Slide and income, split to other tax bridge

offsets impact over the around that adjusted net benefited interest to the have to expect will we EPS year, full the For gains to nonoperational be items the quarters. of quarter first compared timing certain as XXXX expense expenses various neutral next of FX relatively and items X

expense. was Due benefits adjusted year tax stock closer could higher next tax to on few full compensation see in tax rate meaning rate XX.X%, tax expect quarter. you quarters. excess approximately Our a the we over XX.X% level of still effective a rate Nonetheless, the to that

and flow Free million our on focus the to CapEx of quarter on first slightly the facility compared year a and inclusive compared this a to company, the $XX highlighting we free quarter the the had that in becoming capital XXXX, in time Albeit quarter working cash $X Rex in modest, to flat Cambridge spend CapEx expect CapEx million down management stand-alone million first discipline. continue was in earlier. to was the to be full use discussed first was early of $XX of since flow we cash quarter XXXX. positive

Slide on segment X. Moving results now to the

$XXX quarter quarter segment microreactor In was volume XXXX, declined quarter $XXX first of and to driven particularly which which EBITDA XX.X% Despite first lower certain Government a naval higher million. benefited special both This the component XX.X% by procurement. us against strong first EBITDA million, of quarter. to materials, higher and of timing Operations, partially margin the that revenue, items, to by this compared mix long lead X% of worked adjusted material nuclear production, an led up was to offset revenue in in from modestly

full XX.X% key expect EBITDA continue due to of Operations year a be Government For XXXX we the XXXX, few only to slightly dynamics. to down from in margins

this and first quarter expense inefficiencies in Government the to on-boarding EBITDA after challenging. guidance lift fourth quarter. Operations year. XX% third margin that slight quarter. in rates growth in line the cost leaves Again, be last right through with fourth outsized last plus our the labor this our be other the include missile and with absence is with will we a in of quarter microreactor typical growing higher view tube quarter revenue Government second grinding XXXX. at projects margins XX.X% of recovery by guidance gave and can best the and the workforce Those we programs Absorbing But similar in in Providing new Government the the juncture, reported of all margin seasonal us -- quarterly

Nuclear and partially Field Medical revenue as fuel Commercial Service million Operations. Commercial activity well to increases was by robust components up nuclear to $XX in Turning our Revenue Commercial handling lower as X%, by driven BWXT EBITDA operations in volumes. and million. was offset business $X growth, adjusted up about

by was year. lower improved commercial The This Nuclear. to led increase mainly offset XX.X%, margin slightly up which X.X% was performance of in by Commercial partially EBITDA last from from driven Medical, contribution

digits expect year. EBITDA with particularly single We XXXX. Commercial second Nuclear well, to higher contributing of continue digits the with half XXXX by to to as in in be of Medical low Growth high Operations compared margins led the will double growth Commercial

Slide X. Turning now guidance on to

the million. microreactor year-over-year in for for forecast billion more Included step-up and utilized. have approximately by Propulsion as fully We new mid-single last revenue of revenue EBITDA $XXX D&A this our company equipment quarter. of driven a and the least of and and growth Operations project $XX total in leading key adjusted guidance mostly projects in business million, capacity at the metrics Government invested Naval our reaffirming to are EBITDA adjusted are X $X.X we is provided digits, We we approximately

to we such, As adjusted EPS our of guidance reaffirming are $X.XX $X.XX.

over quarters a in quarterly pickup sequential the quarter. the the a earnings, and next fourth expect higher on operating slightly for of we results X As cadence basis seasonal

slightly this EPS interest of the to quarters items, the higher the have with nonoperating a seasonally quarter. and stronger and the a X net to next fourth relatively then In other income quarters lead expense, and we rate. first third being higher tax should sequential quarter progression total, lower expect On consistent second in

expansion by investments $XXX of working flat EBITDA Lastly, million to inclusive growth free expenditures slightly million, expected on and we to be early businesses. down, other improved capital spending driven management. Cambridge are to the cash our our are flow select guidance $XXX plant of across Capital growth and maintaining

we discussed through flow flow our at of cash Investor CapEx driving keenly discipline toward on and free capital XX% medium-term target conversion. improved management As focused Day, are working as we cash both free work

quarter had are To good sum it up, tracking first we year and a achieve our full to guidance.

forward financial Our markets focus in your opportunities to look taking performance. that, innovating we remains to on growth core capturing excellence operational with our and businesses, new driving questions. and pursue And

Operator

Deutsche [Operator Instructions] of Scott Your from the from first question comes line Deuschle Bank.

Scott Deuschle

inefficiencies Or quarter year-over-year else from was just margin onboarding there the and at down this pressure entirely government there in mix? the cost clarify, Rob, margins? the dragging anything to that's plus is operations

Robb LeMasters

No. margin you're some back points. that kind you'll Scott. really, GO look that the if saw, The basis realize margin we was the referring we of year-over-year really to, margin that saw year. last were the XXX to that -- Those highest that, of pressures the all year, the But you

the That positives if first it uplift in of quarters. kind positive from back thing fashions. -- one-time look, a go we had that's TSU fees to of you really normally and couple it see had was over note. a that So the next of enjoyed quarter performance, One couple kind

saw NOG really volume. good We a also

as half, back positives we had to we and sort go think got high workforce the That if was about really of ramp-up. saw honestly, about, at script. a first in look talked we do that I just through with release that some general point. quarter, that That the you

of of way our on describing kind around of XXX going with what's is the really in projects. in just some basis less more from new points down that but mix, step the came second of the The XXX half efficiencies of so Scott

projects, specifically all group, and Technology just within [indiscernible] initiatives AT, and for Advanced new as we our Pele are metal right? ramp So those businesses the up the DRACO, us,

lower coming they're So a at margin.

that again, was from you last the that of what high these ramping the year ramp point half just that about really extraordinary saw mix, kind projects. from we came and So some call of performance a the other real could came half it of new of of

Scott Deuschle

then Rob. last I was That's this multiyear Okay. to pricing supposed have I helpful, want finished And to up think Rex, negotiation say. year,

seems taking bit quite So normal. a to it longer be than

contract light a multiyear you Just to of kind if you whether you get you actual that until on delay shed the can any bridge help done? what's curious and driving get through got

Rex Geveden

Yes. Sure, Scott.

completed bag. of we detail. contract the bridge I some that a the around while it one's a created yes, uncertainty what the fuel negotiation uncertainty part under contract -- combined we course, FY That the work of for earlier. Of of time the would rest that in been the But the we've say operating available. 'XX be appropriations about with would supplemental out that defense period funding

we're And this a that for so correct, We've now on in across through are scope work bridge your bridge, to say I'd long line the that a the now the now. under But pricing -- right? executing position contracts. water finish time those but is agreement get been assertion

Operator

from comes CJS line the question of next Your Bob Labick of Securities.

Bob Labick

your all drug the up the of a more get approval seeking going everything you for was process Rex, Canadian wondering to target just delivery you and give system mentioned take little us Thank DMF and then way other through there to update steps in lutetium? that on Lutetium. radiation the it's [indiscernible] could you for file the for the I master if of

Rex Geveden

lutetium. For

use companies planning so what the our radioisotope that their product filing process. those pharmaceutical a other Okay. And pretty for FDA. Lutetium active there pharmaceutical is the that ingredients, reference to Well, and happens are will and that to that's simple

sometime believe that So business and year, [indiscernible]. the for lutetium simpler it's same cleaner and we'll and in next I is the for on a process thing be timing

Robb LeMasters

Maybe right. making color of to added through a targets. just That's there. little Yes. We're give process the

that has the As built stage. going place That's at tech, X a you ultimately, to OPG. first need source you looking we're the It at around as irradiating through know, to There's Missouri for in already be of you'll we get a to that And TDS capability of you sort obviously radiation. in material first sites Bob, that. then then Ytterbium. And our mentioned, Reactor. that but ultimately, those

So credentialed as line some work radiation we go we're see as that up regulators, get that a material, OPG. make ingredients. in relates the active pharmaceutical standing that's then don't on will also with that have but an to impediment process ultimately, processing there. you it Bob, to know, We for as to through And to

So that's one more step.

the out construction And so we're rolling there.

So nicely. moving along kind of

market as a we're the As seeing frankly, API. for as both lot different for well customers material of the radiated matures,

Bob Labick

isotopes. this should from on sticking And you the Obviously, any Or Moly-XX. a on I Super. with just lot expect quarter. news FDA? next when have Any Okay. didn't then the hear going update information? we

Rex Geveden

Thanks, Bob. Yes. Yes.

perspective Let me on of product and give that line maybe this sort broad development. a

-- of course, what can commercialization this, research the a of exited interested think and we three are in. going of through and for right phases. course, industrialization sort you phase. we big That's most which then, The of everyone's products about I which been development ago, think like phase, phase, time long now

we're tail product. And it's And industrializing of that line. commercialization with that end so the product of the by very overlapping way, at

so it's our the them, most and really eyes line. exercising and And phase, think on for your them radiochemistry the part. delivery and exercising radiopharmacy you, that system you've we've described systems But then you've the seen you industrialization put the about to target when

get to we delivery cost do product radiation to pivoted having the which system, a There's are other and Rob by the [indiscernible] for those systems a in waste things about campaign -- to me went filing us it FDA. from such, as remind and the a way, previous did but you and to second that three. by approved other target big answer, pause but let second some that, management the avoids his the schedule, said And directly

we're that a So see rearview in good mirror to going decision. the and I think look as

activity produce targets Flux through are We've is we targets. the where So a in and System. reactor high Darlington have exercised run Environment. we High-neutron Delivery our at Target

we to exercised done target have system, work We We had that now. It's of have frankly, to, elevators. which some kinks so. those very out had working X in well all

run have product Cap through are say drug we're meets targets quality. are that high on It product. well right. systems. items then the those radiochem bit pleased In and all sort tweaking we And There I commercialization activity been on We I would [ the the FDA. that say would To product the we've very doing working the through of both final the of ]. with pharma those get we radiopharm. the exactly quite of with of the is final meantime, in checklist the enthusiasm a focusing our phase. this market for And

pretty and serious the now, the shipping how on which we're with networks, and tagging in been some kits supply logistics we've radiopharmacy our networks way we doing radiopharmacy. So costs with our by to of radiopharmacy and with kits, in generators product distribute through product. working agreements our We're now with ways working tagging testing product cold and of product, sending cold details the particular,

super we're I'm all through pleased with the and finish say -- I'd to So progress pushing it's well that line.

Operator

next line comes Straus the Your of David of from Barclays. question

Unknown Analyst

the to about expansion Josh on Actually, for plant for I the David. SMRs. wanted Corn of ask the Cambridge

you some to come start of when that If what anything the might capacity to additional you might see give produce? us and elevated demand you on through could allow

Rex Geveden

to one. may add. start I'll with Rob want Josh. that Sure, Yes.

That's for Pickering. XX firm other refurbishments. and -- steam have replacements site. Making which for at pressure we months, Darlington per now for are to per got theaters we XX to when us of orders big you the steam side. heat reactor. look exchangers right XX project. the making So It's reactors, small that the said of the the the making there plant for manufacture will activity in the on on this We're a We're announcement and theaters theaters X likely next on what reactor those we're to making the on expect the and be And doing a generators, side. vessel steam a for very kinds generators the lot. few exchangers for We'll was that, the heat be generators tripped likely receive the the components. that that making modular decision all very on capacity in kind Bruce thing generators over formal expansion as call. And we've we that Bruce for now, steam reactor of Bruce

you it full. I basically, when So walk you that is if that is mean full. up, through blend it all plant,

need we so really capacity now. the And

we'll for our the is reactor, as follow-on vessels. And on expectation will systems reactor that that various the And other orders compete. which other content things the we X see other and there's for other pressure refueling

us organizations and places the And other which after that preparing you've heard followers that, like of that so small talk River same Poland fast and hear that. in -- interested about. other modular for then are the utilities TVA, would And into be type then is Clinch the site We that reactor. of reactors potential go would

be So coming a be ready out we've to that. wave, to built a kind and seems demand capacity in of the for

Robb LeMasters

that's book I the I of the business to last this serve or we to of then and able just we've demand wanted add with -- We to the kind of case expansion side, on with done make we've have, that say, either sort business. a of numbers really that business work And a upside even right, essentially do gravy the quarters. leave might you the SMR guys international of of on to U.S. we the being this. can about in Yes. couple lot talking been

the first have that refer the work the as you business refer Darlington really then come point really ramping an that have to OPG of that the to work makes SMR the at business some and kind Power all end Pickering a pushed and kind to Rex of as you that So up you're case. have said, on Itachi it you follow-on then case. ultimately tail a Bruce of you want And of then the GE and likely ultimately good opportunity the

And greenfields. [indiscernible], talking the either that's refurbs, international more now at you're I looked when about growth,

seem will into be can't but so if to And clever, priced of through. that that all comes counting all be really on it, quite

So we're build-out. pretty that of about the economics excited

Operator

question of the next of Baird. comes Arment line Your Peter from

Peter Arment

just your -- Can BWX Rex, Day, content XX% And -- Is Chase. on to think I Maybe Investor be projects long-lead the topic the kind results. of start? Pickering. about the Rob, Nice at that that refurbishment you you of cost. on talk materials similar actually Pickering? would some that that would we these to roughly of of about stay highlighted that when total for project the ordering expect was

Rex Geveden

a if rule total So percentage on as don't I you the project of think to be we point Pickering, was time. -- scale in the and costs. where contract, a CAD let up similar million give think I could me thumb CAD reactors, But of the, the Peter, of opportunity those, know all I being on steam that comparison at million believe, generators can XXX good I Bruce would see, for the XXX built

of it's So opportunity. And that escalation of that's in estimate know billion can Then project little a I exchangers, maybe the scale steam opportunity obviously, and of feeders add sort factor in cost -- don't sizable a there. to bit total that's but you from a OPG, heat $X a larger and number generators. the

Peter Arment

the when the long that? That's CapEx just kind in of Okay. does materials helpful. activity lead putting you're place begin? of Obviously, then in And front

Robb LeMasters

can I one. Yes, take Yes. that

to near the drive of more at about in So ultimately to talking get cost. they're basis sequential long-lea the a schedule term. whether or also down a they're come after that a not those material And already in looking could set

get quickly So go. upfront through term. near a in I But to the that think wouldn't be they the see with you customer how more and ] or want I surprised if [

Peter Arment

Is there any export When just regarding is you terms updates in order place. that would And one? about we there of of -- That's then Romania. mentioned financing in the timing helpful. think on kind

Robb LeMasters

Yes, hit are I The that, still forward. until is date they're can moving of will EPC out a looking take X at forward. it year when our It's but That around, moving OEM or books. moving too. kind sizably and

business And up. our schedules out and to lined so put see get we're starting to starting

us. be for out to call would I X for sort So it's say X of, to it, it years meaningful

Peter Arment

Rob. part, CapEx the on lastly Just

sounds kind planned already So like you this. it for of had

kind you're putting Are goes Or think So very CapEx little all that of doesn't announcement? place? seem CapEx is up just like growth levels year next we you given a thinking this kind this bit similar much. like in of this at of do about it

Robb LeMasters

describe I'd the X% to back $XXX sales. if we year. million, of Day, from Yes. just finishing go off you if million, little right, last at microreactor had we're then projects The Investor look it you a way is bit And over $XXX

flow range I put our right? have probably out includes sort the different us of free if that of you end, will, of couple that cash So at scenarios. a there guidance, The lower

upper the $XXX might end on CapEx. free to you're maybe of So a million of have cash million, $XXX you say flow, going

that a out build this sort we goodness be could the us we're upper for with we so year, to seeing offset Cambridge tilt from of expect all as in cash that the standpoint flows. And CapEx -- that to but fully end, operating to

even to that the that contemplated flow. Is in $XX good of on remain So operating that's range. initiatives on million this allows to us year, kind our million with sort spend this absorb all if $XX that could cash we -- we of was project what to have

I say think it's year. too early next to when you talk a tad

Peter Arment

problem. no Yes,

Robb LeMasters

next about I'll comment Just year.

I live it's major that in but I little this out, project budget. think don't see any far changes within a can normal

Operator

from Global. Alembic the Pete line Your Skibitski comes question of of next

Peter Skibitski

me, for one Just Rex.

A, basically, opening in the there guess, guys of comments to $X.X that earlier SIB 'XX the touched Or go And I was does I all? supplementals you're 'XX you SIB You or budget baseline and at billion think your you're in about And any approved. at and funding the between suppliers? to budgets DOE goes with -- then you there? all changes interested guys it the 'XX new at okay other just budgets any facilitized? anything anything NASA already doing are So in money and

Rex Geveden

here. Let's see

base that. include On for industrial industrial submarine come And through it the would, broad come base, submarine us on there's which Pete. say that customer. course, I'd more the is of could to funding, our

any you that would second what me? to us. question get if of again to the And for repeat would As

Peter Skibitski

Yes.

up nuclear fit regard the there? With Just budgets, new or got to you interesting and plans I anything wondering in in was the saw wise kind that NASA there's those that if released. of 'XX just DOE.

Rex Geveden

good not, continue. but that of very Pele would programs nuclear I will to see support for New wise. and and sustained interesting and Draco we're say hopefully, and that like the Probably continuing record

Operator

the Ciarmoli Your next comes question from of Michael Truist. line

Michael Ciarmoli

results. pricing. 'XX happening Nice was a sort I those 'XX, what kind that Is budget. mean on mentioned the word, what's I of right multiyear the don't you that delay. CVN with factor a multiyear of but kind going to in fiscal Ford back Maybe, is just that's Rex, with new -- Did schedule contract? of maybe know just if the

Rex Geveden

when our want spares customer, available Yes, going many those we're order, how right? everything, what's I escalation. with what the it's it's shipbuilding through So schedule, Mike, the they to what do working on budget that is is agreements think with

So pretty complex and inflationary thing, to pressure. now labor that with blends a right up particularly materials,

defense through be certainly And things. to for these way, contracts sorting on by that. contractors it's unusual the other to bridge negotiate not So through

it's supplemental FY So appropriation shipbuilding it the into the request we here, up do budget and what certainly above. have blended schedule -- was and all and the out. the it it's it's -- 'XX all sort a the It we'll was present

Michael Ciarmoli

for mid-XXs? getting I sort 'XX it. Got and the back medical to the Medical it then, sliding guess just I the to it. process? the change your there Tc-XX. with approval is sounds Rob, and And still Tc-XX bit, 'XX of directionally, the I but to thought revenues -- the overall of margin that Any million a the mean little comfortable $XXX and in right like guess, maybe pushing on into Got trajectory

Robb LeMasters

any a the that get we there out laid of target, needle different try we to anticipate don't XXXX, Ultimately, really in that said moving would minor actual the We're but any we commercial, we overall Again, it change that term. near couple seeing to impact come will about be as year not areas. from in we're the really talked -- Yes. going don't No, I quarter. last really think really this tech is

is portfolio the good about tech And through Our core some and on therapeutics it, area portfolio. the And move portfolio. pretty if those, really [indiscernible]. the then upside the there's you think you been last

at from lutetium. We're about standpoint, We in contracts. market is, only need to a surprising, the some least talk Actinium. therapeutics we commercial think get I supplier

upside the surprised be wouldn't get fits is for ready actually that to The all player. I the had there. And So and if lining a is we in we've starts market tech for surprised up nicely. third pretty

wouldn't that so surprised And I we if well. one be as nail

achievable. it, overall seems the 'XX, $XXX that 'XX have million revenue of to year target level still readily So call

Michael Ciarmoli

one it. for Got last just then me. And

of Just, business? Fusion background. your pre-revenue given thoughts saw of terms knowing $X billion, What Rob, for your were have what pre-EBITDA you in when kind Medical your guys acquired getting you

Robb LeMasters

I Yes. working acquisition, a We're was thought I solid the very acquirer. think, for closely. it

closely press couple we've As key you we're that know, companies. working of released a with

products bear to is from And parent been read understanding [ them their really knowledge of the supply the And really is Fusion. the One you could if that the bring is on are key. on based drugs that we've the impressed which they fact their what and to constantly Actinium, company. release ] they're press how focused of to with that acquirer, their get

there. the knowledge And not a it's of chain. partner the supply have, the we're products only So but they

makes that, So in our they're what affirming aspect that indirect key that's company a solid. to really way strategy

I -- in the business. we're think I've we always been not drug sell don't transparent that

valuations of really plan valuation of quite ecosystem has shovel everybody and solid really part that of we could these compelling. a think revenue, we're will I think business pick player. patient [ entity warrant that, are with to that a ]. our if when been very but I But will. if more So multiples you those of I And targets, And valuation know bear we the whole be bring hit the a we're

Operator

from America. Ron next from of line Bank the Epstein comes Your question of

Ronald Epstein

quick the When class that does you been, of you it it impact should I a about cadence I what is at on like maybe And down submarine how production delivering to separately? of the connected I you seems kind given Are mean, for that? do. mean Just slowed don't can we what know, Virginia are look one. has -- think have you directly your kind stuff that? all? industry

Rex Geveden

a little that the touched script on just bit. in I Ron,

of shipyards. I And to the off, think somewhat can the then sell the reactors, shipyards, their from product it think enable not to schedule. I HII us are customers. we on We that's them and government you mean, our sell first as GD that decoupled and shipyards. furnished

So little bit from we're decoupled that. a

I way And so about a it. think that's to think

things three think about. maybe -- to here aspect Another

the the are and consider request but and shipbuilding beyond. 'XX authorizers doesn't this enacting President's the appropriators that, mean much budget it to aspect budgets is Another here that's the until and look, for that done is schedule,

to So others heard program. bilateral obviously, out in that production Virginia for peer our innings game Virginia I companies and early keep strong of talking think support it's certainly rate And it about there, that very how very, We've production. very HII important funding is going. the

So I'd is yet. that say not done -- one

needs for base is to and meet office. a higher to order BWXT the have in would the ultimately rate I that to thing third ultimately say production get industrial The

a And more. so this or this to for decade Virginia rate X.X% to needs go

workforce do build And the to so capability got the that. capacity and to we've industrial

any so sense me. slowing make to And down doesn't

that do. priority depth our all much see strategic me we'll given But given so the backlog and what And that of it represents. appropriators the doesn't worry the the Virginia

Ronald Epstein

across speak then to it board for it. you're the been ramp on for the with going spoke the to I it for demand labor I has Navy? and Got it. think up challenge different eventually And you to That sense. mean a on makes the people, the what's people that to I you? need but bring has potentially any Got sum, seems going labor like Are been -- for hiring retaining to meet space. you mean, to everybody you -- you can people all?

Rex Geveden

that last, human the prior And who Yes. about talked and the it, about calls, I'd process for hired where we've talent under fruits maybe things would And total runs in reengineered that couple I years. is say over leadership W's that. us that of say I acquisition Bob workforce let's X.X we there's capital last our of XX% a year. lot this of a our call

in script. said we the As

is -- right? achieve there, been. things than higher and were two needs able growth there in And to an where were has attrition our -- so environment We we so it do historically largely post-COVID achieve

it's on those that certainly right? to So that an of it's a to won I economy the tough not sides trying ramp we do, to I'd scarce that's labor, environment All reindustrializing on submarine hard U.S. and U.S. that production. say hands for your thing we're sort both And of and said, up one. resources. think the get easy

we're with pressure so about many onboarding churn. feeling the of on that pressure people we're the that when It in in that getting has And Rob amount do that margins. talked to our

in got of a Our the would. this product making you've got we people we that lot efficiencies with thought training of a that. sitting of overhead through profit because good. turn lot classes, But We're are and you people

anything? Rob, want with, So we've do say the and acts dealing I very good want challenging think, have I to really is swinging you of we job that thing. keep environment, at a this to to a done add just

Robb LeMasters

really you workforce. ahead to of we We're the think same to well. the issue thing last and I try of we absorbing capacity, the swarm CapEx industry, No, think, said do build got the year it I on

turning through ahead we component up that's got now others points basis in sort industry, we're how but will XXX our But we're it, year-over-year. we sites also so goes almost our And year. of are which is said, top through, chewing about as at problem our And the that just it utilization BWXT and Rex of address are all quickly. and

with which shows can So still our take and moving. we're sticking workforce keep we guidance, in that that all

other side going and I the this So quite on to think we're be strong. be of

Operator

will for turn closing remarks. Q&A now over conference I concludes our Chase Jacobson back session. That to the

Chase Jacobson

for today. us Thanks, joining everybody,

over the you you be many of speaking the many of seeing in days months. with coming will coming We and

questions, can If Thanks. free feel you you have any further at out investor@bwxt.com. reach to

Operator

for you Ladies that all today's call. Thank and joining. gentlemen, concludes

You disconnect. may now

BWX (BWXT) 6 May 242024 Q1 Earnings call transcript