CW - Earnings call transcript Q4 2024 | Curtiss-Wright Corporation

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Operator

Welcome to the Curtiss-Wright Fourth Quarter and Full Year 2024 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to Mr. Jim Ryan, Vice President of Investor Relations.

James Ryan

Thank you, Sheila, and good morning, everyone. Welcome to Curtiss-Wright's Fourth Quarter and Full Year 2024 Earnings Conference Call.

call and Chair Financial Vice Farkas. the Officer, Chief Officer, on Bamford, Lynn President me today and are Executive Chris Joining and Chief

call our is this available available press download through replay and a Our of Relations webcast of at for being on section curtisswright.com. Investor well a of copy presentation be as website the as the financial today's the is today company will release website. webcast Also,

statements statements with discussion that the expectations today's Please forward-looking on of will We those in guarantees defined Reform projections and future public management's not forward-looking include SEC. in our detail are statements our note, risks Private Act the certain as of are current Litigation uncertainties Securities and are with filings performance. XXXX. and These based associated

an current may the As results are noted. reconciliations on greater earnings and that website. organic restructuring references and adjusted excludes to Non-GAAP and GAAP periods to translation, non-GAAP into to unless for costs an financial currency Curtiss-Wright's view adjusted include provide in release acquisitions, exclude prior ongoing available operating order Any transparency a in otherwise year certain reminder, our are performance. on company's the basis and divestitures foreign growth

call Now things I'd the like to to over get Lynn to turn started.

Lynn Bamford

to shareholders. record financial areas, executed while achieve I contributions Thank and talent, for you, research their begin to want on by some and success. exciting Jim, our employees systems development, thanking Curtiss-Wright, for and good nearly invest in of for our our morning, strategy including an everyone. We XXXX year our most X,XXX critical to growth was and continue our we results and

of building with progress May. X-year execution and past our momentum, the pursuit Investor past this the We steady teams year objective Day this pleased in clearly unveiled are we made and I'm

I'll provide before financial presentation. allocation Chris preview and turn our on year a I'll call then capital to today's our more the fourth over quarter brief covering and a I'll outlook our review financials. full XXXX of XXXX turning highlights by in-depth to our update of performance that, provide begin a With the to of

prospects I'll closing to Finally, move our Q&A. long-term some with we remarks before about wrap up

fourth to XXXX better-than-expected flat, margin essentially performance with highlights, sales Electronics segments. year-over-year was operating Defense XX.X%. increased income Starting both Naval strong X% our quarter & was our a at due in and Operating while Power

As modest XXXX a dollars a were reminder, footprint benefit various reshape a generated undertaken million our our and our which few provided to results. of in savings initial actions, global restructuring some to of

increased fourth cash book primarily Diluted order demand up driven growth and XXX% conversion reflecting in X% was exceeded lower our our of XX% strong solid earnings in A&D working commercial in continued per share rate capital. the expectations improved results year-over-year, were X.Xx year-over-year, a flow sales. higher Growth by quarter, our operational by Free exceptionally markets million, $XXX reflecting was nuclear. was and at A&D book-to-bill. within all These which to strong also performance a due driven and

free of per $XX capital to of of our XXX%. million reached share strong year-over-year. than growth increased XXXX We flow and reflected grow a demand firm included record record faster year our our portfolio core commitment X and earnings Of cash results generated number within expansion the XXXX, results, full supporting growth our which segments. another highlight financial incremental a $XXX of We underlying records. maintaining modest in across reflecting Adjusted expenditures $XX.XX R&D I'll Next, XX% double-digit included year and income orders. while margin in of investments conversion note, million all sales. operating sales delivered Diluted

communications book-to-bill markets record Defense and equipment confidence book. strong Navy's time, Electronics our ground drove increase, of Nuclear growth benefited record Leading the critical computing overall. year-over-year propulsion way new up than and in embedded in outlook. equipment for XX% reaching the which the exceptional, demand additional billion most orders XXXX, long-term our Power in Naval defense billion segment, first Total a results a aerospace from Curtiss-Wright's tactical reaching great same X.Xx the & At the order segment reflecting our $X more higher the in crossed supporting $X.X time. our XX% Naval of backlog for U.S. was and Demand providing was was to $X.X Turning billion demand for where a platforms.

activity. room of commercial about control nuclear repurchase WSE, plant further Turning radiation acquisition We we provider to June, our December portfolio. added temperature comments systems closed of of a which the systems, Slide on and simulation some businesses Energy, with Ultra on and sensors. XX, new protection a technology. and pressure XXXX acquisitions we monitoring specialized power supplier is leading And flux In and reactor leading We X share to in our X. begin expand added

nuclear Ultra SMR reminder, presence generation a footprint, and only including to commercial it well safety with enables to nuclear us and This power provides and the our As as globally fleet various not but leading markets, acquisition as U.K.-based products defense leverage submarine U.K. also expands applications. critical nuclear manufacturing our designers. global plants supports also services aerospace

welcome Curtiss-Wright. to all new of to pleased colleagues our I'm

share of collaborating to growth with million. our integrate increased for $XXX boosting are accelerated In month to also utilized year opportunities already we our further increase we customers scope year, year. full $XXX activity. the alone, and we balance as activity our repurchase past our eighth through our consecutive we an the to for plan, strong also This we December sheet these capabilities. stock As dividend Curtiss-Wright's of teams position XXXX, financial bought our accelerate back In expand repurchase million new repurchase acquisitions, the in

drive growth acquisitions. to growth exceed markets projecting once sales X% would I sales organic income our to total of growth, again are XX like X%, our At the of to which by nearly we growth operating anticipated strategy and of growth guidance. expansion to our XXXX including the the heart continued XX% margin our excellence year in fuels reflecting platform, Overall, of pivot range. points introduce by expansion is increases Now XX basis margin all the savings driven and year in opportunities for across to growth full our is driving to this operational operational the mid-single-digit portfolio. end for at Operating midpoint

manufacturing optimize organization. addition, In systems the tools to our deploy throughout we'll and connectivity continue drive and new to operations

again accretion. efforts, This, us Ultra an incremental ramping diluted opportunity anticipate this to development strong to in provides will XXXX. It also in few past along backed research business growth, delivered the as into yet with our energy our dilution growth growth drive allow flow. and acquisitions operations generate by overcome such over strong organic EPS, These to investments as maintain successfully line top double-digit we to provides which broader years opportunities again we've with and free for turn, in in future integrate cash margin confidence us once drive seek to and up

In remains well positioned to an Curtiss-Wright XXXX. summary, deliver in outstanding performance

call remarks. Now with I over would the like our to prepared to Chris continue to turn

K. Farkas

and Aerospace expectations. in key XXXX X, & performance Thank On quarter X% was our drivers review in segment. line sales fourth our increased the begin I'll Industrial, by I'll with you, where overall Slide of Lynn.

most Within program. supporting experienced the aerospace the we sales, markets, segment's F-XX notably actuation within market solid defense defense increases in equipment

continue OEM growth and vehicle reduce commercial increased industrial both on their reflected to segment's wide-body aerospace the results the results market, customers general market, platforms. Within sales supporting and as production certain our year-end. solid global sales industrial lower our levels through off-highway In narrow-body inventory reflected specialty

This continued demand our second Of quarterly in fourth And see of increase order the we year-over-year invest Partially turning offsetting those industrial restructuring to higher have on-highway despite since note, was we for in of delivered treatment declines R&D market, domestic improving vehicle and this trends our initiatives margin a was of record on surface reduced we with a equipment absorption to vehicle to driven in XXXX. modest sales support sales the future quarter the favorable and to while along profitability, segment's services. growth. operating our continue benefits by XX.X%. quarter

Next, Defense the segment. Electronics in

If to future of you recall, several half implemented business' XXXX second this growth. initiatives we beginning the in restructuring support

and our schedules, the deliveries accelerated in ensure customer quarter. we some and ramp-up expected efforts into to to the Given on-time third delivery revenues these

unfolded, more volume. As on those effectively ahead progressed in result, And quarter quarterly was restructuring our efforts schedule, the fourth able we as expectations. take to of recognized revenue, performance a slightly while sequential and of were declines we ahead the and year-over-year

XX.X% performance, on our realignment we though as due unfavorable operating solid impacted manufacturing a was margin, revenues, delivered and fourth timing by our of the well the mix. to under-absorption partly profitability operating Regarding as lower footprint segment's quarter

higher by and Naval class as this was Sales in the experienced aircraft the segment. Power platforms & stronger-than-anticipated due carrier of Naval principally key the on growth material we Virginia across part to our Defense. as ahead expectations, driven class XX% CVN-XX timing well Columbia of receipts. to program production in several in Within market, of growth submarines Turning revenue

the systems We international and increased aircraft submarine for SSN(X) development on to revenues next-generation program higher also experienced handling demand customers.

Aerospace U.S. our prior and demand in based aircraft on our reflected commercial process and revenues of performance strong In in arresting Within strong ongoing Defense reflected timing supporting systems the market, reactors. nuclear market, year the & segment's maintenance period. the results results power the international continued lower operating

timing of lower sales market domestic process in valve strong sales in this the offsetting growth Partially was MRO period. demand prior on the the based strong year following

markets. quarter profitability operating strong across maintaining and Turning to on the process results, favorable fourth absorption portfolio. commitment while performance across revenues, XX% unfavorable overall To of our to impacted we investment was nearly fourth the higher R&D segment's up generated margin sum Curtiss-Wright's our a despite mix operating defense by quarter mainly

I'll to plus full reflecting contribution note where Please the begin from total mid-single-digit process Energy for Ultra defense we organic embedded revenues aerospace that reflects while and X% serving Slide both international sales of growth XXXX the our anticipate majority outlook of grow with customers are in growth Turning year the to sales guidance. within power Energy. sales Ultra X equipment customers. defense, end-market in mainly guidance. outlook to our X% on our Starting our and markets. tied to A&D electronics, domestic to also business market, our to sells higher computing X% X%,

X% the this support reflects to aircraft on for X% that as our complex up of higher demand customers. ramp Defense, our overhaul which a revenue CVN-XX refueling XX% sales international principally X% carriers, and ground supporting program, sales including is XXXX. strong outlook increased reflects growth aircraft increased to continued follows equipment, expect begin equipment, systems also as arresting Naval in on to a Within tactical year. will production We CVN-XX well the as growth of which for multiyear effort communications reminder, In for strong X% growth defense,

that accelerated embedded our programs those XXXX. supporting expect be we business, submarine Elsewhere, Electronics offset partially various anticipate into programs. within computing by international and higher We increases to revenues on timing Defense domestic

contribution Looking to of increased broadly to I'd across highlight the growth expected military we all XXXX, more in to In Defense priorities. markets, X support of sales. foreign direct expect our like FMS continued defense by spending low double-digit technologies Global driven be alignment the

commercial aerospace. to Turning

Our modest XXX growth expectations XX% on OEM strong reflects growth back sales year. the outlook driving wide-body the sales XX% narrow-body on our book, the in higher including production for and MAX half to of order aircraft

We and services by and segment for Electronics well driven instrumentation as within equipment. sensors treatment surface Defense expect those Avionics be segment our our higher Industrial to increases as for sales and Aerospace

these to in our sales up X% in and increase markets, to we aerospace Wrapping markets total X% defense XXXX. expect

driven as from year-over-year to Moving growth a Ultra the is be aftermarket to to Ultra in despite as commercial Energy. combination in contribution acquired Power demand XX% and increased lower from Growth of sales Energy. the XX% commercial single-digit outages newly Process, U.K. reflects to well strong revenues high growth our well mid- by supporting revenue nuclear. for U.S. as & as organic expected outlook Starting markets continued domestic aftermarket our

ramp-up than advanced outlook revenues this we commercial acquisitions. also reactors. a And X-energy this market SMR TerraPower several result, development as greater organic high XX% Our a when including the growth in single-digit across year overall includes and nuclear in growth anticipate including and designs,

well outlook and market, and to contribution growth as process with to supporting subsea low our a the development increased power markets. Energy Petrobras' nonnuclear as generation notably for organic sales the operations, oil Ultra reflects Deep on pumps, gas from in most Next, mid-single-digit Sea

to Lastly, XXXX. sales anticipate in be market, industrial flat the we in general

aligns typically modest growth outlook Automation growth reflects Our with which Surface Industrial in and sales services, rates. GDP global treatment

However, by sales amid optimistic that book of vehicles industrial but we upon growth our XXXX. market reduced ongoing will be throughout remain challenges, improving offset order based cautiously

to X% markets, XX%. targeting commercial growth sales total year Wrapping our up full we're of

to where our grow year sales strong reflecting aerospace expect segment sales I'll on overall, Industrial, X% to industrial. in general growth Moving commercial begin full Aerospace we XXXX Slide on X% to X, in flat by outlook in and &

project income reflects and we our sales to as our basis profitability, segment's XX This outlook of generated growth points the actions. operating well XX from to margin the range Regarding and savings expectation XX.X%. restructuring as X% X% increase higher for to XX.X% by operating to

we sales Defense X%, of markets. record expect all principally Electronics, driven solid the is driving in business' by grow across to book, Next X% this XXXX A&D to order which growth strength

point growth investments. XX.X% Regarding and headwind R&D all-time basis the operating of which X% of points segment's XX% a XX% million to range from income margin a XX new includes $X profitability, to basis funded internally we expect to or operating of to increased high XX expansion XX

of Power, across And defense the & to in X% or reflecting X% markets. XX% growth solid growth Naval and segments, XX% sales to organically, overall expect commercial we

income and well organic sales to segment's profitability, Energy, as points on XX.X%, will a contribution of initially be the we dilutive the Regarding range XX.X% margin margin. as higher expect of to to to operating which reflecting both growth XX Ultra from to absorption expansion favorable XX operating operating of XX% XX% basis

also impact We'll move contract adjustment. Naval from the year's last quarter past $XX million first

$X funded incremental R&D to In approximately support addition, guidance internally in million development our reflects investments programs.

advanced note, high Energy, to technology business year-over-year Ultra And low designers. as increased we on expanding revenue a this similarly this double-digit Regarding SMR across margin investments this focuses outlook in produce and reactor business in growth XXXX. presence its major includes expect of operating generate single-digit

overall, grow summarize operating So we outlook, income XX% Curtiss-Wright XXXX our to total expect XX%. to to

XX.X%, XX.X% points. to XX We XX expect operating to basis range from margin to up

of Next, high first modeling by margin, expect quarter operating including grow to aid XXXX to in relative your quarter Ultra of digits the sales quarterly Energy. XXXX, to we sales single and first

margin the line Within the profitability year's demonstrate expect exceed sales on based to in operating strong results. expect A&I businesses, XXXX in we seasonality quarter Electronics, Defense first and our and and In quarter with the growth first segment, within results. sales these be last will we

share Power first initial at in on operating financial while quarter million start payment mid-teens expecting from some color level, I lower is the few on wanted income reflect we our approximately decrease cash first to and on solid Slide year cash we balance a by other profitability in nonoperational items. for Lastly, & Energy growth. Continuing we're Naval to In to dilution expect the increased summary, principally sales, quarter XXXX our $X quarter strong entered slightly with activity. the I'll as the margin growth margin outlook with Curtiss-Wright income, given lower XXXX acquisition. year. This to which we fourth Ultra segment, provide million X, our due expect this Energy repurchase Ultra $X a interest will overall sales with

which note, million in current the again the pay we'll offset no this down positive And senior we'll will assumes $XX interest notes in a have lower against that revolver XXXX. borrowings this in expense. month, have Later guidance coming due,

XXXX reflects in In reduction addition, XX% year's efforts. and outlook our on rate tax optimization a further building last to efficiency tax our

to guidance. Turning our EPS

your quarterly We aid our strong we EPS relative XXXX quarter EPS to strongest. $XX.XX, to to expect within to and XX%, the expect our the operations. approximately from year, up we growth first expect to in diluted full year quarter to the first being quarterly last XX% profitable range similar reflecting fourth To with EPS $XX.XX XX% modeling, improvement of reflect sequential growth quarter XXXX

our million share includes in XXXX. in the following also our completion that note in $XXX a EPS share repurchases of count Please reduction outlook

cash record from on XXXX, anticipate earnings, essentially to last in projecting For year a performance. year-over-year small offset increase year's Ultra higher start to we're our Growth $XXX flow in we is repurchases, in year, above operations capital dilution. million share from focus of expected cash to a from management. to and reflecting continue $XX we Energy line slightly $XX the working million million to continued standard a XXXX, program cash benefit $XXX flow free contribution in as full million lastly, And

of cash to consumed reminder, all-time which as free as expect record last would And in portion progresses flow be level a year's advances, an from we a XXXX. benefited work

increase In our a flow cash long-term year-over-year healthy addition, million of we in line remains guide expect excess relative in our of capital targets. expenditures with reflects $XX growth. year, to rate nearly conversion to which to invest outlook future midpoint Overall, the of our in we continue again this support XXX% free as our

over call like back Now I'd turn to Lynn. the to

Lynn Bamford

turning And to X. you, Chris. Slide Thank

record As with end confidence as we well our order profitable markets deliver growing provides our have as backlog positioning today, our in within XXXX. growth book and to discussed again us

of sales While expect political we light macroeconomic environment, the growth ongoing high cautious year. generate to remain we and total in single-digit this

in both reflects of our the and combined and increases strength commercial outlook our This markets portfolio. both A&D

is the significant Beyond we're of milestones forecasting that operating in midpoint one to XXXX XX% the the guide. most our at margin of reach line, top

Our to in this pace we and of growth the result of expansion to continues strategy, a in fundamental excess growth premise be to XXXX. an Pivot in generate margin drive accelerated income to expect Growth operating revenue under

steadfast of development and These positions serve the investments defense nuclear. to enable capture we platforms next-generation better to cash strong outlook on customers. commercial growth. us fuel R&D as and from technology incremental or better able in to while And we increase systems noted, operations make continue allows us year, operational SMR in EPS focus benefit investments to generation this on will still continued our investments on to grow for excellence our based as Further, flow continue targeting our our we've free infrastructure efficiencies double-digit our are to

completed through beyond recently capital long-term our to we balance approach shareholder as value. our focused Energy we and to regarding are Ultra look acquisition, returns for disciplined work look the capital to drive deployment, strength put capital to a and possible of our strategic we And continuously the allocation. the best sheet investing on Next,

continue Our and will pursuit remain has acquisitions capital been highest for to of high-quality our allocation. priority

supplement as by our in our earlier Beyond that, consistent shareholders, driving returns highlighted remarks. to those I will pursuits

XXXX results achieving financial we growth to committed Investor strong and considerable the year demonstrated Day. our our established progress having targets objectives, Finally, long-term past remain and at confident X-year of towards all this

as targets to we Beyond May's focused and and at Day, Possible in next key these our out the our we remain strategy proposed last that Investor Art technologies decade, of secular the The look of across the we to growth trends. alignment confident

a generate recognize disruption the along to that sites. to projects technological our over of firmly create and term these continued impacts But uncertainty this our and and the turn, remains The at potential view both of is that traditional provide market drive continued external to continue demand and applications remained one address to market value data in well way. This, shareholders energy to including on in high. legislative our the remain unchanged related near carbon-free and and to an large centers. push for energy the Curtiss-Wright's projects for the demand, within is complex medium growth energy heat likely energy independence global and satisfy on forces strong demand support all-time and movement is that core and ability and AI We fundamentals the needed will to and electricity process incremental as as expansion long growing

reactor expect for We are continue next pumps coolant X X years. APXXXX their to America and Europe and we in across Westinghouse power with pursuit new the our North to plants order in to an aligned construct

and across advanced our The which moving to later both of this conservative upon overall has would Investor is with the growth continue presence and our the outlook, organically you expected accelerate supporting of reactors opportunity modular changed of We to also prudent through supporting technology forward for point, many very At impact Day our the build with decade. strong still existing leading small was reactor projects Curtiss-Wright. are Curtiss-Wright continue position assessment nothing this that know, a numerous of globe. designers construction to that and acquisition reactors grow all

encouraged the Finally, the Burgum stance of Secretary U.S. Curtiss-Wright as and Secretary Energy we the nuclear of remain Interior. appointments new by administration's pro the Doug the and recent as new

decade U.S. started business As tremendous of initiative our Collectively, a our projecting confidence mission-critical and continues commercial annual pursuits market shareholders. excited billion, as reminder, by across to rate the this great to Defense advantage long-term the our run garner Curtiss-Wright in and support. a world-class are regain in our nuclear future XXXX, Curtiss-Wright's industry such I'm that nuclear to to our of commercial middle support positive Navy. many and nuclear operations these the as Electronics strong about grow forces beyond value In an the next to to fivefold positioned and bipartisan the closing, $X.X providing portfolio, optionality, U.S. our partner

expect pivot strong sustain We solutions, and our build our to expanding in with to markets and continuing momentum technologies in growth while new winning to by growth exciting and strategy.

open Thank up would like to time, you. I for questions. call And conference at today's this

Operator

coming [Operator is Stifel. Nathan first with question Jones Instructions] Our from

Nathan Jones

I remarks. the I'll SMR it color value your more the your on Ultra color businesses platforms? And on of a you touched maybe know of bit on to business how strategic guys financial? of a this Just of you acquisition. grow about. outside you improves hoping Energy one some European excited leverage I'm see these get have on how manufacturers, some that your kind some on in with is can of these to bit just current contents the been prepared more on the things I guess little start you position

Lynn Bamford

it get in Sure. done XX, And close, -- thank it for question. we we longer were anticipated got the year. you than that December to but took it to We

to But down break the Texas. main U.K., definitely, that longer from We've out both one the X with in because the acquisition bit We've get together teams had the closing So gate we nice figuring say these with clean it's guys. both on can would had took we're strong one of how of a meetings position. were started of locations, point out than chomping the them, you anticipated. collaborate in at and kickoff

enthusiasm So, and going lot there's of activity a on.

So a said, important that some as transition there. is talk being meetings European we most as you advance it strategic aspects there's the reactor based gives localized possibly think to the doors a they more with it. are footprint, Rolls-Royce, supported provide them opportunity about relationship a major to better products be how with through that the supplier that that and to which notably providers of European were Ultra a more our really of One with great have European and to partnership fit, engaged initial with able them to -- and as content, the on couple beforehand already be opening we with us can but facility with

that's now. that So most be with us biggest don't that that's of before one footprint. it kind that's the imply right want But of one but that, one leveraging example just won't I to customer.

our energy mainly strong market of market, much get temperature broader fleet. pressure were breadth products relationships and to these that They an pressure also and example. Dollar-wise, see with world aerospace high the very revenue potentially critical as the there's applicability commercial but But critical is across more designed and we tries the and more not as stream. one it's it's temperature a can globally work, overly do us where as and a their partnership. submarine for -- sensor They're that technologies sensors that produced we'll mentioned, something take with U.K. efficient, nuclear of part significant

we'll a have that can products team. much reach how market these take in focus we for think I was to a really greater than

on of area. with early And that so working we're them days

with of of some this customer that have. deep And same -- just industries. we connections couple, one industry knowledge, about a that's think heritage inception I the exciting we in touch Investor from And from So businesses it different that just things talked on Day, our is proud many brings have the our we heritage, team and we're their to heritage. these but how

And customer so well-established to just They're take great really just base. what tangible this it's the can a that in more strong than and our we things. player unique technology broadens with

Nathan Jones

sales. second my on obviously I Awesome. U.S. military push from the a guess get increase foreign defense Europe to spending. question, to There's their go big, administration going big to I'm

what should of Air areas Defense which of you on benefit. don't can by with Ground foreign fit X%? Europe I would very should Maybe Defense could likely defense to just increased think governments I military focus Curtiss-Wright's military would on look us increase portfolio. just and European would kind color well give of be spending or military color you some give for improvement you how you expect kind us know, any if, sales Or spending,

Lynn Bamford

with Ground Rheinmetall a only in manufacturer only, of preeminent let we the numbers. that, you're there, leading speak right. platforms not strong which very and that's But then used is very I'll of Chris great variety over the vehicles But a a before we and to have over one. sophistic on is place very stabilization very really partner. Europe, a area much partnership Defense capability vehicle of the the in is type equipment not that

have we aerial -- capability types other to that products into both that of vehicles there. systems so ground and deliver and And are

sell of a But lot of we U.S. stuff those -- and just ship directly out the and customers. into

So our is product applicability pretty great.

that, over the let to through I'll Chris of with numbers. maybe talk, turn some walk So it

K. Farkas

XXXX, GDP. GDP great growth going in for NATO Nathan, been for what a a will as sure. be say really should necessarily In that I accelerate, lumpy. only across FMS kind to and FMS XX% despite continues onetime year to difficult to very know. with that the increase can that is predict to business, This our us then grew vector it's help I in has a us, Yes, continue of some have of growth, . was you little growth country in our direct back of X% XX% issues But have XX% sales which over Curtiss-Wright. for accelerate the spending TTS or seen that bit Curtiss-Wright. if timing grew the in great for our NATO FMS and some portfolio. we it their we prior But too say, we will increases translate we spending expect now than 'XX, in really past more than more that, XXXX, few And years would had that

and Naval But their into we markets business, Power. supporting aero portfolio a very our Power. some electronics CXISR business again, we're the handling defense and broad as saw to Naval our at Aircraft arresting have pace, aircraft ground well to that demand that we going handling year, and then Naval strong expecting enter be And really driven we're grow across ground low as as of by within some double-digit plus that and to within we next based this continue benefit will & given and systems mainly also

see opportunity forward, for an going So we sure. Curtiss-Wright as for it

Operator

Our Mike comes from with question Truist Securities. Ciarmoli next

Michael Ciarmoli

Chris, I looking backlog. record results. order great guess Nice at flow, just

would and organic of and has Defense of been the seems Day. aero the on laid just You've got extremely other you strong. kind growth bit piece little in a revenue better. obviously takes kind in any have what that like I kind -- a bit. Investor have outlook maybe But thought with XXXX line It puts and I puts dynamic? takes, been out would any of But decelerating other digits know in mid-single

K. Farkas

year, the XXXX, when lot here work that of experienced book-to-bill are we to I across activity think quarter that's perspective, our Power. A&D like second well order where in a & really X.Xx that positioned we coming look particularly into Curtiss-Wright. you of we markets. in multiyear at Naval enter A as feel we a That's backlog with from

there, strong to I we defense, solid actuation that what's jets. but there's look the business not had CXISR, for across we additional what's only driver growth over other certainly opportunity happening have a work program that within Within in happening F-XX Naval a So as the they see Defense, business. that for also fighter aerospace and some relative with

uplift to And arresting systems on within looking international you're at & ground-based then Naval the Power, some an level. relative

capacity book of XX% continues. last we year, we're approach it As we great. management stronger year that The and had we in that business, this the footprint some order growth the defense, even enter within ground into doing year, was before. is But as that business that

first more little So here the of completed. a of we some get we'll chatter until efforts maybe expect those in quarter bit

really overall, look electronics, at you as we've just then got things that we're some And defense I exciting think doing.

systems expectations And to achieve in You really projects organization. are is and to improvements to that growth footprint in and major on CapEx the going the of investments expand that with some and support have capacity. are future the can of organization saw those some across it for the just we what XXXX. balance Other just in enhancements we

we've taken I into -- year I So appropriate position like think the that. all an feel entering given like

Michael Ciarmoli

get just Got it. to contemplated news operating in exposure, looking guess, guess, couple income helpful. tariffs. kind And going going are That's I there. every guess thinking at your or I kind on of outlook? here million And that's and about tariff a How back X:XX to question maybe then But back presumably. up more you I here you the we're a coming of either the or almost XXXX, across today had headwinds topic revenues potential in dollars of at

Lynn Bamford

But half conversation fluid you're the late Curtiss-Wright I with of material situation. to to with the half the I But lost were pandemic would $X we topic million, about least. of past is were we has the we not up which back recent the which dealt business. situation whether in And sales. past first absorbed $XXX disruptive teens, at It's right, came it a say about variety we the mitigate our definitely customers to communicate able and but million of absorbed the tariff along, thing and appreciate over you guess the situations, I a of bringing was

it's supply ongoing We inflation steady chain delivered electronics, and disruption has defense to note, Curtiss-Wright growth important I through think in margin situations. all have steady these the and expansion

we our we situation this current or to have action-oriented So very and agile manage team. have commitments a as

cetera. making we're sure so things such tiger have we some operations, can and et our watching flow information already We're contract legal, cross-functional to terms that that doing financial, related have. we the handle reviewing with are everything we really actions, things customer to continuously delivering the And minimize teams all that's can around a We've we definitely we product price things. do of that as products, contracts, mitigating the those whether the through lever or government approach a can to a disruptive isn't areas on are improve and communications now that options thinking focused consider and and to recovery the that to communicating overly impact different started formal

So we in feel managed that at will this time we situations past. in point manage as have this the we

how -- some broad, significant also the even more be changes if But tariffs permanent, appear more to and the might contemplating more with more make business. durable, other to more we we're -- protect stay

right so, it, you we more ongoing good as manage to through and able we we we situation, obviously, do feel than things, will way we guidance the to our year. but about need And obviously And of but this be know really if an feel is entering those our now have details it.

Michael Ciarmoli

just I think Got you last Helpful. one, And Lynn, it. then heard I correct.

anything a it in cooling -- sort to color on in changing guess news, looking Is the maybe there? order line? is latest Russian that X X just the update kind line. any APXXXX? opportunities buying to RCPs next maybe But the maybe on at Is with general reactor You're sliding for reactors expecting guess of some years. of time -- Bulgaria. Ukraine that I the pump Is right, that out from market I

Lynn Bamford

Yes.

progression that RCP X Ukraine X, from honestly, I'd this it's began our X with years a year-over-year. say, when over to for our the XXXX line been, time steady over past first out So steady XX, has X orders to situation to whole coming with the X, amazingly February from X X guidance gone morning,

to really very X with pipeline. has years, X stable. work expect very, it we of order we're We an the when so monitoring by XXXX. Westinghouse end very closely remained we saying initial And the say And on

be XXXX to there out And the just from of news moved would operational for their Poland specific, feeds that's those one really So now, a but news in is say XXXX. I of little time bit frame, then. wouldn't X- the more to X-year the to end between by piece now and XXXX. say date more somewhere I has who follow all

expecting known But that made that line has impact public. just does our not the It time. not some order. time absolutely for Westinghouse first was of

first with think order, that's we a worked Westinghouse be anticipate is that in that and to anticipated that order So don't as delay that which still let Poland. to

that's a that. Curtiss-Wright. mean, back specificity not other happen, has that just it of were has note I the is opportunity But points there's thing. of Two Summer So plant around potential and much for one being online, good to a been forward. there's If talk trying very V.C. of that put

on for approach the what of that India. this to considering be their kind down week break indemnification that And sold into flushed been is breaking late is barrier being nuclear which news has changing out power plant always could to the again, needs plants India

think a are things X jump those those So of kind are potentially Poland good. new things. in either of there a out new I Bulgaria going to and of don't are but going that's there or ahead manner to play order, that are

Operator

Research. Our is question next coming Wolfe with Walton Myles from

Myles Walton

at point Can is large the in the that new quarter the X% deferred seems was the it from for there? What what was cash as revenue every an to revised business, Could as that starting at order the you like started XX%. give also, up come defense on look was through you X% went exactly XXXX end X% expectation higher. XXXX to getting year on X%. on at comment of And I growth And naval to triggered and that your then flow? to some color going

there is opportunity? upside a similar So

K. Farkas

Yes. upside first, I to discuss mean, opportunity. the

very, that And across had coming answer business say then I our maybe able you that the the very think last received were in of question achieve that with positioned first be that we whether to would you we ability staffing business for volume significant and strong. I at business this mean, feel year. where we're receipts the to pretty or well the through material that, last look Myles. year I into this year to that this convert asked, orders naval this was When ramp-up we it

think our certainly I expectations. we surpassed own

in completed, those provides come as that bill certain of for milestones gets an advance on and orders opportunity And bill as of that work or being us to achieved. kind in,

at So if for you a last and the we year. this step in I mean up balance million deferred sheet revenue were back $XXX look Curtiss-Wright, take

fourth advances in record full quarter, a well. So of the only year, not as but the across level

advances quarter, Electronics did business, submarines So really across here getting Defense also saw of want I most their that you the but work. a ahead of to in they that acceleration work what job relates and to fourth solid happened the of into in our of say,

in that this of good that that. so contract, but say kind effort. Defense. a into was go will there upside I there was -- year, wouldn't single lot as into So all be And a we went Naval it's

the think execute and the through to to that again, feel say that to CapEx get lot of that about and ability But place that, backlog put good I I'll guide upon do sooner. just going a on right and is depend we entering people is in the -- year. continue the into

Myles Walton

for book-to-bill have segment you Okay. that? was what by XXXX, if the And

K. Farkas

Yes.

and & Power Industrial, & Electronics X.XX, So it Aerospace was at Defense Naval X.X. was look if you X.XX was

Myles Walton

Yes.

maybe, going then know What's upside we're the we on X previously lot. Lynn, have of and to X the to opportunity years America Gulf material And drill given that's business, a next been for versus pump if pumps subsea and a what the Okay. the over outlook subsea thinking? the you've

Lynn Bamford

probably across it's Well, entire market, I'd thing. baby drill our end say is process a drill good surely

but things of all be good Curtiss-Wright. fuels, executive and pro nuclear, only to LNG for very and was fossil that -- going So early aside. orders The it executive -- orders Curtiss-Wright, was joking the not is very pro first

pumps the decade. for That size of by $XXX as we has at so And the million end not the subsea yet. potential this of opportunity of changed

it Petrobras. feel the some but stages with pump deployed a equipment it We things only industry. sell getting But footprints we're will across like for process the many going not tailwind valve the subsea, Shell I around at of through that we and last developing just our other be sort of really and surely

Operator

Gursky will take question We our next with Jason Citigroup. from

Jason Gursky

questions a to like you, just of picture if with big okay. I'd that's Lynn, couple do

you maybe a as just you of minute past. if seen have all what, wouldn't all And administration. differences the of kind result been mind any with transition on anything, the different reflect the than a you transition? this transition And for with you've doing has if this in starting seen differently in how are what Just that

Lynn Bamford

think been that So everybody the realizes I on fast-paced transition news. terms a the it's

not I so true universally necessarily that's And Curtiss-Wright any think tied particular in way. to

dominance sees an order energy nuclear executive I weeks on like in and fossil things clarity of really production. how the position such think the all on the coming out administration things with support and clear nuclear first for the as fuel very X

that are not those of speed clarity is and levels think of clarity typical. I

meantime. that's itself out what's is the that next what tariffs, to which of of is -- we the on side So that, be here what position to the weeks in have we'll the mean, But other do kind and live going right? the as the and of can sort will clear just in ambiguity couple think, I to with hopefully, I not is the Now not is paper clear.

government we dollars I and spend if take big you wisely, okay, wants see that [indiscernible] over to broadly a But thinks what more the set aside things, that picture about, what intent also is. it if anybody of speaking, obviously is efficient have news all and the

I be think for that's going thing to Curtiss-Wright. a great

drive is which less lot vast, is of One of these a fixed-price where plays is cost-plus wanting the to the of beliefs more vast all majority and Curtiss-Wright thing. contracts friendly that a out to of attitude it contracts, good

like good very bureaucratic produce our the that to with deliver which proposition prime in we directly government I projects that take in and to the making we could dominance that for process of across called efficient I at implemented. building and of way believe the finally feel I to commercial it U.S. in line out these through the spent delivers Curtiss-Wright the sense. can time that And value only feel a take, And meaningful speeds a either the if deliver Curtiss-Wright footprint money less or it on be from the if be out value. efficiency energy a a only government to some nuclear equipment, that apply then to that that, And you confident is think clearly military. is more up gives value a great the nuclear, I dollars commercial

even U.S. way But negative. code. So in the And of more we'll is positive the see in towards things win Enduring that's with and lot favorability produced we a Electronics tax U.S. have Defense everything I will that's content that Dome, we drive mean back see Iron to we and if other and U.S., things, hire all that where U.S., a that it There's in things the through that our I companies us. produce products produce goes. we in great happens than a it's don't would how a on think be see there those -- -- take that what Shield we'll the out turns for is executive the but many a in the good across Curtiss-Wright. XXXX I lot content, mean order If of whether

of lot administration. but a like America, there's here focus it, of areas, hire to we this and in and you again, a that's clearly things tariffs, So, build taxes, name

federal nimble. moves the our will news best daily take how in it the by say So stay we're that trying to I government can to take we as consider those and and comes advantage.

Jason Gursky

to what maybe price to going the give to on might you touched maybe in prescriptions, fixed recommendations contracts. should if more follow-up be at point the sounds those or be touched was Pentagon, they term. their what type on to But looking thoughts could here touched that done? fixed And those. some get are hear maybe That's great. briefly -- interesting at to that It make back way on I Pentagon price see to the the what take and you'd on some firm other contracts, And guys actions and near think you you step the your like be over firm across you on was my like to Key Bridge was which question, going

Lynn Bamford

a and you've even end, defense acquisition is than of process. broadly, that. say, would the the I our more attacking some for Well, industry If not produce about -- streamlined. think will larger companies In broadly, talk And the CEOs that the is whole acquisition government, of process less. fairly is I process slow the us heard value

say just top go So that's of to your comes that we're mind. doing back things I'd first -- add But to different. about one question

really response make coincidental of because this to it's Pentagon to what One is Curtiss-Wright increasing later Capitol are as visibility company we were we what initiative our XXXX to decided big emphasize does a on and this in our we the value things -- and as and as the to really points bring and the differently a is touch last much government. at year Hill doing

I will are think government. for U.S. we we and I stand that we the present get the and And efficiency, a up a what dollars proudly and connecting know supplier great drive for do to

as I so And the nicely align will is all that think us that going this message to bringing on. out forefront

Operator

Arment next from Peter Baird. comes Our question with

Peter Arment

you Lynn, the nuclear. on about could outlook comment commercial bit little a

get -- this high is year, for that called organic low change out this there You double a in last there is you -- guidance just double assumes we is 'XX but deceleration your 'XX. year 'XX high organic timing grew low something growth is a related? digits. from single-digit Are digits single pushed for Or a out growth versus --

K. Farkas

No.

see as and grow trajectory period. being that renewals very that's a of to we a headwinds be low the a outages, is something while once years committed have to or year, over year I'll benefiting we This the year-over-year one every double-digit a there's the and that's happen we of to lower we year. some from we that this the there. Peter, did And around industry, say flex Investor are think, we the strong going bit kind are X-year work CAGR I going and dip Day, X starting of last to license would seeing little of that's just more and are there facing that so, happen still

the across overall, support operating that. But fleet activity higher to maintenance

in design and the to about prepared themselves. remarks, X-energy. bit research it's TerraPower not what a to in and little We're investing wins they're talked and just in We excited Energy new see but that secure going Ultra do, a ramp-up steady development about some effort. are can exciting the and We

we that we as guide to the X-year into continue expect ramp good only work think I we And to that we period. low feel SMR gets enter the really to gave overall, double-digit over this as up about So prototyping. XXXX, closer

Peter Arment

it. Got

do just, the helpful color. made comment Lynn, this you you then organic? space? you business about decade. in M&A get Is And being That's Okay. into contemplate as the that nuclear all out the Or more next Xx

Lynn Bamford

We of standpoint we and rhythm up aftermarket drumbeat anticipate of that content and organic of are today of really an plant build we anticipated. a the life did the know we the APXXXX driving beginning from and where that from what extensions at that the is build-out SMRs build-outs,

is for Curtiss-Wright. within drive a wheelhouse to is So that business that our

Operator

Global. next Our from Skibitski question Pete with comes Alembic

Peter Skibitski

& Power. Naval on follow-ups of couple A

clarification. a just First,

your at that I you the the But and in I booked guess, receipts in So revenue Naval why strong and there? material a the fourth the that quarter, expectations. the that little low-margin margin those you on led XQ revenue. below to in kind brought on assume that's came is of the Is work way revenue what material,

K. Farkas

was the book. that support strong Yes, so I'll but of it other progress and to mean Naval associated and material, with -- good up in definitely beat order ramping I were just portions better a of partly. the say portion staffing

that to Cheswick We work work of Another milestones APXXXX actually the naval little Naval for here and where in shift subsea to we see fourth lot nuance facility, had quarter. work. those those subsea resources from out the pump development of and been did some some support the do a

by the little margin as another reason that's business. look overall for very is you nuance great large, the biggest versus while defense the fourth And So and we higher a it's business. missed XX.X% a just at expectations here But the strong had quarter, in here. still

look you you margins. and the products across process nuclear about Naval narrow a products it very and portfolio but think products dilutive. and There's sales, and can Power as & defense producer, be strong international They're solid obviously cash

a strong lower defense lower high those the carry sales quarter, combination systems, international during So it's arresting great valve quarter a very prior and the arresting systems, naval had really of margins. sales year really we the product and fourth of and

you mix across look explain. as the mostly So

Peter Skibitski

by XXXX the And to in Got it. doing there? I That's restructuring it. appreciate the then about you help to us closing that of other investments? looking what's the restructuring understand segment, helpful. are on? you the the that ahead to doing sites, you positively is think impact it going Can what's year. like way Are And right end looks guys going margin

kind but mix back, -- I add you some if color Just or shifts was just there? maybe of the wondering could

K. Farkas

Yes.

of second into million and the spent be vast segment, fall for which the million to just get to you call, think A&I majority increased clear, that So annualized XXXX, our But we in million of $X $XX that. majority to basis savings. I of $XX we get that to million margin, to the and that to or million $XX is we going year, into million fell this spent XXXX account the $X through maybe the of restructuring XX quarter points third $X the spend. fell

XXXX other to biggest group. into the that aerospace to industrial continue entering of is The and piece benefit going

efficiency some is you you and towards back We're spend look expanding strong had for moving here biggest of what and but forward. that into that lot as going took bit in continue we those still the -- outlook we're really little excited that electronics, is strong. book was the And doing the step we restructuring. QX. just. actions obviously, though there defense to very that There's contributor the at looks within business of we're some quarter, But yes, behind probably will about incredibly that a results, then going be disruption, which footprint. A second fourth order We're capacity. even

also doing then deeper So some maybe a things or a we say CapEx, this. exciting across that we some investing the as do position hope I'll of have get in into we're back more that systems from we're not organization, I the But in to systems restructuring, year perspective. only we are

going that lot defense is And a really -- most spending we're and industrial is work forward that's defense going support And aerospace at in this to electronics and where that. on time the effort and trajectory in of electronics. but and point of

Operator

will We William question take our next Bryce from with Sandberg Blair.

Bryce Sandberg

shipyards that impacting business, labor of production. you've in had that's the want ask seen strong we've chain one significant momentum Just supply on But disruption obviously, pretty your the naval and to Naval business.

of to opportunity So just how And may flow your does more represent disruption through to an the work better want within that supply business? for chain? may kind understand take or that you not on

Lynn Bamford

can Chris asked exact shipyards the advance, the of equipment So walk flow a material. of some -- And is through if kind flow frequently. in our shipyards. you're years advance But usually fairly the in curious, of order such in of our decoupled a couple to from years material that's as the is question lead. And degree, reasonably get we're we're we long

a coupling. one-to-one And isn't so really there

ourselves And supply. new happen Navy shipyards. the we are as or out don't the kind of supplier source to and as equipment presenting And taking to do to needs a taking frequently, things of a standpoint, Now some not from one ambitious, content won they move naval happen. on but but through an one always second those work opportunity that points coupling attitude, hungry, it's with really open we've

K. Farkas

exciting play we that's becoming about work, talked aftermarket East Investor of lot really is it Coast to RCOH that arresting the footprint in this a grow. about this only And Curtiss-Wright. the great aftermarket in systems with that coming some script. provisioning things also talked got and not gratifying Day add that's on a just internationally. it West to We initial just one little got a the we We've service also X to of helping Virginia-class about centers of work just so It's Coast. bit growing submarines but is business, the out and at in there's Curtiss-Wright see spares the one it's available I'll our and naval

other that -- are grow that's and the what's us we what in not experiencing ways tied now for to are shipyards. directly there's So to happening

Operator

and There Lynn for are additional Chair the Chief I no lines. call from further questions over turn Executive phone Bamford, Officer, the coming to will now or remarks. closing

Lynn Bamford

today, we results. QX Thank good when our you, look everybody, of forward reconvening Have have us we your a day. joining for rest and to

Operator

Thank wonderful call. This you. does conference day. earnings conclude Curtiss-Wright this today's time, at Please have line and disconnect your a

Curtiss-Wright (CW) 13 Feb 252024 Q4 Earnings call transcript