Earnings call transcript Q4 2022

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Operator

Good day and thank you for standing by. Welcome to the Kaman Corporation Q4 2022 Conference Call. At this time, all participants are in listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

like Ms. the now your over would today, speaker I to conference hand to And Vice and Stath, Becky President Controller. Ms. Stath, please go ahead.

Rebecca Stath

Good are President fourth the and morning. quarter XXXX Treasurer. Officer Vice Senior earnings Kaman's Welcome President, call. Jamie Chief Coogan, call Ian Chief and today Chairman, Walsh, Executive Officer; and to Financial Leading

our our today's consist of of forward-looking we note some the that the will Before business, with of the to setting other call forth current and begin, These items, and include management, objectives company please other statements information expectations business. projections of respect discussed performance, events. revenue, company its during economy underlying assumptions statements earnings of statements and financial the statements or economic its regarding and on future these of plans and the future

results filings differ any Form the Commission, Securities most release. XX-K on important including together X-K those indicated actual included on report due earnings many in company's filed with and described with quarter company's latest are Form the fourth from could the factors, current in to evening materially company's yesterday the our of the XXXX statements results forward-looking Exchange The and which

X-K. defined and and GAAP We discuss to certain measures financial included in SEC regulations. are measures filed applicable that also yesterday's are release non-GAAP measures as with Reconciliations to expect company's in rules information the earnings the

on our earnings posted an performance. call supplement additional on financial we context which Finally, website, our provides

this find can www.kaman.com/investors/quarterly-earnings-call. You at presentation

Walsh. Now the I'll to turn over call Ian

Ian Walsh

providing I XXXX of quarter, pass our decisive XXXX financials joining improve for us and Good Thank the position will to our everyone, a for call and more for to summary actions over of success and in fourth taken morning, quarter the outlook. by discussion for call. Jamie start you, earnings us by we operations then detailed and our the have you thank followed I'll Becky. a beyond.

of XXXX. year enhance continued in with the operational communicated we performance. strength overall challenges earnings finished in hard our revised Our quarter segment, We to the by multiple ahead expectations Products teams to driven overcome initiatives third our coupled the on Engineered in worked EBITDA primarily progress meaningful call,

Our full fourth reported in the quarter full $XXX.X compared of in quarter $XXX to prior the strength in the benefited million million the our Products the the and Aircraft contributions XX% $XXX.X at and for our to in on year, reduction & by program. volume acquisition, Wheel year from $XXX compared year. And Both grew that in segment came year-over-year, sales Engineered offset prior sales at JPF Brake we results million organically from year. million planned

adjusted XX.X% million, from EBITDA in was the $XX year. up was quarter which prior fourth million $XX.X Our

adjusted year, from November. communicated we year EBITDA during For resulted our improve the to range which launched above This was was the in we $XX.X and the full million, execution initiatives control. cost

the we industrial supported in further the in segment by our see aerospace growth strength was in end Products quarter medical in recovery continue Performance to commercial and and steady markets. market Engineered as

acquisition. Brake from of & In our Aircraft addition, benefited we contributions Wheel the

we pleased integration to of year performance XXXX. very and the with in forward new are business, We contribution and full look this their

correct. a XXXX suppliers, have our challenges their which of emerged had the working and couple that businesses been several teams to with

also We had reduction the anticipated JPF volume. in

growth footing a our with highest path strong businesses. head clear backlogs As have in forward more we XXXX, on continue to we into stable

recent variation reduced and of JPF have primary the on our performance sources in We with consciously K-MAX. our announcements

the margin and XXXX the number take structures we year call, on the more sets our Jamie K-MAX Later expectations business. XXXX contribution have contribution firm forth following no based only from will the number is through hand; aircraft detail. amount Our in one, assumptions: from of two, includes the orders outlook, sales; it three, for small you number which no on outlook our in JPF

near-term continues our transition emphasis of is businesses, our be growth product incremental key highest next-generation include on IR&D. team's objective innovation, an our a advancements where Other objectives CapEx business Our focus strategic and component and of Precision on manufacturing. the our autonomous combination process Products to through fuzing primary investing in to

segment, benefit to have already year, focus improving and more In high-teens recently we a work. our our our just our operational of from business winning new low Structures programs deployment expected have margins. on consolidation aftermarket continue tremendous single-digit EBITDA structures from profitable gains realizing the result legacy at business, structures Vermont had The of practices over they announced and best the a to in to gone OEM Jacksonville

As are This our our will we adequate enable DCS capacity Connecticut existing footprint remaining reducing volume recently rationalizing facility. production for maintain to in potential Middletown consolidating our while us future announced, costs. production JPF and

facility We Orlando the the expect to complete of the of during closure first half XXXX.

production. K-MAX review analysis a partners market. year, with evaluation, careful thorough customers announced addressable After last January program the assessed We the our and in channel and of and discontinuation talked future conducted of the we

platform, to a therefore level While struggle unpredictability orders. in creating and low volume continue competition, unique capable it of K-MAX would high with is and

removes of going The production of cash low flow use this requirements significant variation margins not significant and forward. ROIC. meet and our K-MAX of cash for for discontinuation and source expectations working EBITDA a do program capital margin, The

training. will providing blade existing continue the with and including fleet, services, parts, exchanges including [ph] operators repair, spare to support fleet rotor We

business the an identified incremental our to activities reducing continue corporate These total action SG&A. lower redundancies functions inclusive Lastly, cost to and to and of our included optimize layers, taken consolidating support structure effort we have corporate in headquarters. between and units eliminating

with high and business markets Demand across aviation discussion bearings, market we commercial, Now our and business turn are general the update conditions. the to to as an levels on for let improve springs, orders contacts. me continues seals of general seeing

January, now end specialty our exceeding in As pre-pandemic business XXXX. backlog the of in set the outstanding bearings levels of is

margins over improved anticipate we sales the coming and the higher These trends year. support

defense JPF defense our of of remaining portion to looks programs. Although up defense year-over-year new sales the to ramp volume, expect spending and business defense from our increased we in to benefit lower due decline production the

growth, and and The to environment. medical rates we national a market interest increase order industrial moderate our overseas budgets to organic identify end In in global markets, changing support our to continue defense rapidly and areas and complex growth. and continue meaningful show provide

XX.X% our by segment, Wheel strong the of with segment fourth benefiting continued XX.X% driven performance By addition beginning Engineered & Sales this and business quarter, the units respectively, in Products' quarter full for relative outlook. growth in and increased these for and the Aircraft year, and outperformance organic from to Brake.

for respectively. year full improved to and margin XXX respectively. for the also XX.X%, basis basis quarter with translated contributing year, were the points XX.X% basis the Higher the & Aircraft volume points, Wheel Organic sales growth basis both points XXX XX for profitability EBITDA with and Brake XXX and and quarter points up

sales decline the full markets. EBITDA our JPF products transition Products for In from resulted to volume quarter declined and new respectively, XX.X% segment, and year, This growth we as XX.X% contribution. fourth margin Precision the reduction and lower anticipated and these businesses corresponding

us new discontinuation announced development the segment opportunity our the further missile the provide as improvement the facility and technologies closure of Orlando fuze restructuring the and savings, of of K-MAX for to other is will of allowing in cost of focused programs. this on our focus Much

include: blueprint continues exceed opportunities. success. we for quality improvement improvement facility facility Vermont growth and facility expectations optimization as for In a our serve for as Structures prepare to and this Key initiatives efforts; Cash plans; our segment,

to financial Our continue journey and other acceptable to structures this bring efforts our facilities performance move as segment mirror we these will into XXXX levels.

a During XXXX, our and in on for million took which quarter. and loss great to and strength continue enhance challenges XXXX reposition drove of strides early our facilities Jacksonville allow legacy growth. persisted the our These for improved power $X.X programs, Wichita financial in actions us performance We and XXXX to Kaman operating the earnings will underlying transform company forward. to going deliver and long-term our businesses two

transformative and solving competencies center we strategy. of that at and were executed These with to stay mind, will most demonstrate our complex our continue of highest innovation customers' opportunities our our core growth as the initiatives in problems designed

year with to Products investment the on backlog while new look are segment, segment. ahead, Precision execution and we technologies we on have we focused our Engineered the Products spend being deliberate As and in our strong against thoughtful

priorities very near-term and reduce reduce overall quarter-to-quarter; our to processes; sources annual our continue to performance performance, to cash XXXX variation or clear: level which our of load advance eliminate generation; Our in us better our are continue help will leverage. drive

more Our intact our as long-term grow continue sheet re-strengthen company profitably. our and strategy remains to balance we

Jamie I'll numbers. the to look Jamie? over the at call for a Now turn closer

Jamie Coogan

to morning, walk before I Today, you, everyone. outlook results fourth and Thank our our you quarter through Ian, turning XXXX. for good will

than higher period were million, year Our million. fourth was sales of $XXX.X quarter the $XXX.X prior which

stemmed in and from to our $XXX million were year. sales year full growth primarily were from million the in organic JPF Lower the contributions sales Wheel to year, lower acquisition. quarter prior segment, Higher Products in shipments. the due For total sales Brake for compared & $XXX the Aircraft Engineered

margin Engineered Aircraft Adjusted XX.X% from of in EBITDA Wheel performance to in $XX.X quarter of & or EBITDA Products mostly in XX.X%, of period quarter the XX.X% the a a $XX fourth addition of in to or million, fourth stemmed margin the compared and the XXXX. million, Brake. increased the Higher

programs in Jacksonville million year, function and arm resulted a adjusted that quarter. our our and Wichita. communicated This matters was full we Lower of the $XX.X programs sales XXXX. at compared to lower was and in million chain $XX.X EBITDA For supply device inefficiencies structures EBITDA at from and safe last program decrease

annualized range realized variation we in base and cost lower approximately by Ian million XXXX. caused initiatives we've to $XX have a As million programs, reduction eliminate implemented with in XXXX, cost $XX program the our approximately of historically to performance. which to million $XX produce to significant expect mentioned, be the In measures in termination and savings aggregate,

at million million are savings the our facility, redundant will the closure the $X million $X the operating levels corporate $XX functions the savings and begin reduce see achieved primarily focused sales we associated least restructuring, between to end business units. Orlando million to corporate to we of structure on related elimination XXXX; activity savings These with following: by immediately full of current between million as with to to of comprised $X of the $XX of rightsizing

implementing year $X additional production continue on cost And savings additional aircraft. discontinuing are remain as yield the to in focused and million to related measures K-MAX improved committed XXXX drive optimizing to in cost to lastly, our this performance. We order out structure of we around

of the earnings our affected share. resulting Turning for for Adjusting GAAP during of share earnings in quarter, diluted diluted share back XXXX diluted quarter the per adversely compares were earnings results impairment taken we adjusted and per charges, share per earnings per in $X.XX quarter, other $X.XX and to diluted share of the achieved of to fourth these fourth charges restructuring $X.XX. per loss adjusted This $X.XX. of a the and by

write-offs full For per the earnings of $X.XX. impairment charge year, of and goodwill and & period, the costs to primarily In we one-time diluted related were diluted loss contract due share JPF restructuring, a to on current cost the K-MAX, related Aircraft inventory our Brake program. to Wheel to adjustments the share demand a $X.XX reported of acquisition per and related adjusted lower

items Adjustments fourth tax release. to severance found discrete in the our be of quarter prior in GAAP reconciliation A amounts year costs. non-GAAP full primarily to can related earnings and

for Next, to guidance I'd like XXXX. to our turn

demand end from Seal where Engineering business. impactful team & of bearings growth Underlying we to remains our acquired our on match markets stronger returns course, optimizing growth businesses, in Bal highest our the businesses, our expanding newly Brake and, expect most Wheel Our specialty while business contribution and structure generate can and our cost Aircraft strong size is our of our focused business. we continued

the $XXX million free we million. anticipate is in of to total million of flow and the $XX the million XXXX $XX million, be for million, result, top in cash flow revenue to of million cash to to $XXX in range million. leading operating to year with a expected $XX expectations adjusted to As $XX XXXX $XX of $XXX in Full growth line range EBITDA range

growth by from the with expenses offset in remainder of Wheel the XX% we've our taken, business JPF & These due Brake. addition of and Aircraft volume. EBITDA lower partially from cost actions lower adjusted the organic Approximately is impact the of coming increases improvement to are

and on interest Our income debt diluted XXXX. our of are because lower EPS for results, historical acquisition outstanding primarily AWB we the to costs expectations higher pension expect due lower than

operating volume, growth in JPF Aircraft actuarial below these impacting compares reminder, XXXX. with pension million assumptions market the of When is together the the a expected $XX.X which to factors As income, conditions recorded was our in organic which for offset account Brake. degradation was pension the XXXX. per Wheel of decrease partially anticipated largely and the combined income income $X.X was This by driven This $X.XX & of by plan. share contribution lower for year-over-year, million

cadence the our the expect have better more a quarterly of year, And quarterly in on worked Touching earnings. we to balanced for level earnings profile. earnings we XXXX, on

XX% XXXX. second anticipate approximately half our and to Between EBITDA year in second be the towards in the of expect weighted We EBITDA realized we adjusted first slightly XX% quarter, be compared our to first to adjusted the full quarter.

excluded improve reliability order been discrete and In improve have high to items, guidance of historically sources which variation. the our have transparency, of we

remaining held JPF and sales Specifically, these inventory. K-MAX orders, uncertain include of un-awarded DCS or aircraft in

contribution margin from Structures We assumed segment. our have also no

provide in our our will upside If We expect in these for XXXX. are success this but areas, to incorporated to not expectations successful, guidance. we are achieve they

turn over closing I'll that, call to the back Ian for With remarks.

Ian Walsh

Thanks, Jamie.

earlier, in and result more position a a a forward to XXXX as and actions with stronger planned mentioned much of clear I entering are predictable create path more we stable deliberate As results. company a

continue with culture discipline, internal develop We greater controls and a leadership. to

such team professionals talented design of We a solutions for proud our engineering and and work sophisticated customers. to highly to capabilities develop are very alongside with

and is in been our future I'm employees dedicated to instrumental Our our than talent, dependent X,XXX success. workforce commitment whose our of has more on thankful

open that, have question With to line our like questions. I'd May we please? first the for

Operator

you Capital [Operator Instructions] Barger our And of Steve come will first question KeyBanc Thank Markets. from

open. is Your line

Steve Barger

good Thanks, morning.

Ian Walsh

Hey, Steve. good morning,

Jamie Coogan

Steve. good Hey, morning,

Steve Barger

should year's this through exiting portfolio and down, Products? K-MAX JPF gross longer on then last XX% margin expect you term, you Just gross wind think the think as first gross restructuring, margin exceed do focus when you range? be we do low margin, what And will on for question appropriate Engineered

Jamie Coogan

somewhere be the off we So overall & the to portfolio maybe just look the addition one, range into K-MAX do with XXXX, higher in that incremental anticipated gross the points We than higher last XXX Wheel Steve. to as Aircraft of what the given sales. margin we and I'll probably start basis absence of of expect year, to Brake XXX

Ian Walsh

best mentioned looking our clear as feel all I of Yes Those what we targets, have numbers those and businesses for relative is class are. what mean, know we segments. forward, to before, Steve, performance we've each

- So that's the and first piece.

to and assemble our with chain And all of the activities second we working we're and our piece how hard is, supply build, relative deliver products.

at year-over-year. away gross chip expansion want to margin margin. continue we We So, that gross

Steve Barger

portfolio? as you exceed presumably, you'll of look points optimize that as further year, the couple you And basis continue out, hundred the you expect this to

Jamie Coogan

Absolutely.

Ian Walsh

Yes, we do indeed.

Jamie Coogan

Steve, of key comes there engineered the product side, organic Yes significant with base is drop-through drivers to in very growth the on especially relative earnings. through one the business,

grow, continues incremental business see gains. to gross margin that as to So would we expect

Steve Barger

for right efficiently, you savings look when at cost Yes, income you the percentage SG&A growing, got the opportunity seems similar on like think it. Because a SG&A, I biggest that's portfolio is And the are is? have want, things running question statement? the do revenue it you what as

Jamie Coogan

Steve. on lot a cost agree looking do organization. that to There's with at work we're and Yes, still around you of going cost in overall that, we the

closer want think get long some to down XX% - we in below if run, we I optimally, that to XX% scale. be if and possible, incremental with the

working more hard to team's the efficient, ways on G&A be the more to front. productive, through So think

Ian Walsh

done crept again, the the or has nice couple - in inbound a a is of offsetting those SG&A have lot material yes, think I last of the that me, team up Yes, - job years. costs just excuse

XX%. to is XX% target to definitely get fundamentally, below our and close So

Steve Barger

frame up billion that. need And from the do an XX% you $X of all at can on to I it or in revenue just at standpoint? hear accountability be you you - aspect Does scale

Jamie Coogan

be I to we we get mean, - threshold. think that I billion no, XX% need Yes don't think to $X at to

than today, as I $X a there's of - again, think be level slightly that. obtain we'd close efficiencies at we a not significant be higher But billion. than at are - can probably level it we'd but we lower

Ian Walsh

will to But after ago of years year scale help. we function on going the go what again, X.X really is got and definitely right now SG&A. we've a started Yes this activities

So that continues.

Steve Barger

Okay. one in then and I'll ask jump back line. more

fulfill had year, test first last 'XX. of Can end program? just KARGO planned to full the and about half talk changes - of scale updated of and flight now I think your You towards time that's UAV you thinking the on line

Ian Walsh

Sure.

So, we other day. actually of end just year said with team the checked and it to early was in the close year, this actually

first So flight. our we're very to close

a that's for milestone can very done As important us. Team marvelous you imagine, a job. has

we'll flight. it. close do, we're we first once everybody very So that about sure taking make knows And

not we've MULS-A just Corps we've the forward, but significant going announced from funding also had as of funding program. from the success, Marine terms with In Congress,

So that are Very excited with in working we're what that kind is were last the with now a the in Marine funded direction Corps. and towards just week. program of expectations They that. their

next is early need to Marine demonstrates they're next be Corps they whoever step, then window. fund XX-month will the - mature going is the anticipation to and a The big capability say, we'll technology. it's by which we're Our of an the take confident series year, the there, to prototypes we're that

that [ph] field push we forward, if iteration. about they Marines, give need And the is production the level production. for would we into they've to kind move in, first want can that that. us then And targeted they timeframe. kind of who 'XX us then customers, go to excited From be full a.k.a. the still to 'XX, of that that rate point rate ingredients Full they last the will really prototypes of with finalize told

steam So great. cargo, been which full ahead with we're has

Steve Barger

further many how competitors will do here, through As the selected process be for know? you you go testing, gating down

Ian Walsh

two in program. there's, MULS-A now, Right the

step know or of don't next we would take see. two so and we'll they not, if - the kind So

us just of down literally it's two now. to right So

Steve Barger

Got line. back it, thanks, get I'll in

Ian Walsh

Okay, thanks Steve.

Operator

And you. moment our please one question. next Thank for

Our next CJS Larry Solow question of will Securities. from come

line is Your open.

Larry Solow

for Good morning Ian. questions. Thanks the Jamie and taking

the it fall on or follow-up timeframe that would there 'XX a to how in potential moves KARGO to 'XX, commercial get sales is about question, UAV the commercial before a first? after going Just of sales Is kind expect? line you military

Ian Walsh

hours yes. military, on have the feel the that from answer the We a tremendous out will than several customers. of The and faster they And way helps It's amount the is military all about by we commercial building already maturity which interest move aircraft. tremendously. confident

So, right year able hopefully the to of this that we've announce got now demonstrate exciting interest we'll some be to happening things KARGO.

there's And think oil amount about it's and relief capability mention and offshore, of things, again, - you some other you whether the interest of if and gas a there's just and what in the the I on got is obviously, military. the higher right KARGO will addressable interest to relative magnitude brings. as said, commercial market Corps. of now Marine side I say the orders tremendous We've

the But working us to talking with has the been right we We Army. of also Force strong and the U.S. have and know in interest SOCOM as Navy already well. now kind Air

So about the on the distributed a is big solve, That think trying them that. to problem are we forefront logistics. for of to services and are really

Commercial with almost as I X,XXX much, about demonstrated stuff small on side, happening just article how just what's they've read already. an and Walmart flights recently

offshore of and are oil boxes, of to the looking those and certainly, All other prime and big be going companies KARGO. some for the -

Larry Solow

for recovery The couple aviation. Okay, of Obviously, up has Products. probably the on appreciate for driver segment, pretty your years. your last this switching growth? gears nice that back Engineered certainly a in great. biggest And And is had economy biggest I we've to commercial color. well just held

does backlog - That next that they're your a well. few strong concerns any pretty you 'XX, we have the Does the over the strong is we performance and I look concern out, and situation, as know that current to of just even? getting as all? quarters Do if over relates at how economy slowdown you economic the

Ian Walsh

markets. Yes, frankly, wide The of Products, a I'll start. very quite our nice cover about part range they end Engineered is

and And and helicopter GA, track heavily all of and in the we're certainly, rates. Airbus build strong rates also We industrial. seeing the on loaded we're Boeing aviation medical commercial and side, So those. growth but

there. - have everybody going We knows on what's

a seen recovery. have We nice

uptick would the to the aisles. because you I've really be 'XX think aisle, really data the double I aisles seen, we're that timeframe, all for I tell the think from will seeing Double pre-pandemic. XXXX, got is before going and strong there to an single be I we've content back 'XX, on

inroads, jet On strong our made the you thematics at some Wheel business look and we've other like Aircraft of Brake. & really market, what businesses if

a Military Bell. CH-XX. for lot some V-XXX, side, we've right program contracts, in a which We're knows still of got a everybody big strong stuff working was win now on future position

this our fabulous. relatively Engineered organic optimistic strong our our that Engineered markets on same We growth I'm double-digit really is growth. year. Products. And we And So saw, the thing anticipate as for drop-through end we mid last Products mentioned, for year, just

Jamie Coogan

high clarity Yes, are I'll right. on we products, specifically bearings very, And at time more to very of of year's for order got year out going we've are there at year-to-date some I the to this of level just of fill we our the book year. Where move relative provide of as continue we given a there, kind orders that's specialty so through rates strong that, rates pre-pandemic levels this confidence business.

Engineered earnings low well expected is Products with we organic drop-through in to point, to of the of that for believe. going Ian's XXXX power out growth And that received, rate business incremental sort mid-teens be of

Larry Solow

new excluding update And about hearing coming new the that be or some we - Products. some wheel But the area on about Engineered couple new how and in out, brake obviously, I might that's products about a a talked of things have business. think, introduction? business, product Awesome. and Any guys when titanium you

Ian Walsh

the for is new business, we made Yes, diffuse proprietary our about steady which technology. titanium process when we've actually K-MAX progress talk hardening

we've right, diffuse movement in can and There's that. limiting XX everything propulsion. titanium from now plating hardening as huge EU either cover that knows, a example, space for everybody parts are or approved that chrome got do in So overseas testing about the

to talking So us. Airbus has the been

in teams the medical after industry, it's other work joint now right some just things. got [ph] already class We've stuff in and

to right? TDH think, the to start testing in these strong take that while obviously do accelerate really just be itself time. continues I in team - out migrate really to teams And So here the will going we're looking a over growth and develop, that a So years. time certify, portfolio the to to of

Larry Solow

the guys. thanks color, appreciate I Great,

Ian Walsh

Larry. thanks Yes,

Jamie Coogan

Larry. Thanks

Operator

moment next you. question, of our Seth for come next please Thank will JPMorgan. our question One from Seifman

Your line is open.

Seth Seifman

Okay, thanks very morning guys. much good and

Ian Walsh

Good morning, Seth.

Seth Seifman

So flat start I asking looks looks a midpoint the in I looking based guide. think about from to about we sales wheel revenue at million its the the in in JPF, forma 'XX look wanted And for guidance. and for pro there's and off what's brake, like, And on we've XXXX. basically it at at backlog if $XXX like million that the it $XXX headwind so

so, growing you'd years, forma like main if pieces took 'XX be out that to probably 'XX. pro both What you JPF are driving of the XX% that from And XX%? are

Jamie Coogan

that to so some we not have sales are in other might planning that I repeat is did as add like year-over-year. well I one your math, Yes, piece The K-MAX Seth. we XXXX - to

it's call [ph] that $XX So it, right as to about related so well. million or about

there, So & from mid-teens Engineered in, growth is growth structures of portion growth grow. talked absent on really to year-over-year absent to the a significant about, is low Aircraft expected of probably coming there, Products, is where Wheel rate as we coming Brake, K-MAX, absent organic JPF,

will We incremental them overall. get need make sure we our any as margin contribution expected the upside opportunity we to some those We're of those counting and on A-XX got But and this not from recovery nice really guide, businesses right? as HAWK. be that part facility year. BLACK healthy plan and of volumes our our our We've mentioned, that out with to and coming Vermont

Seth Seifman

when JPF without it, of line? top the pro years, what go-forward got that basis, okay, and sub-XXX business from forma will okay, it's - place of of a growing out in to then think so like kind when I there the about in get kind like, we And about think terms we start looks any contribution guess, where a then on Products Right, it. got Precision

Jamie Coogan

spending defense strong happening have of And Yes. you're that's - as where to with a fuze sort support do be of see portfolio some things for would is a missile the going defense that's to to going through here expect contributor year. new over very this kind - burst fire incremental like technology know, come And is we course and programs. the our world have and of of as you to the orders around we seen that, the well spending increase as expected that

Seth Seifman

I portfolio guess would see remaining the okay? now, would right strong pretty demand Yes. fuzing some

Jamie Coogan

Yes.

Seth Seifman

And me, during the the of around year. a maybe kind turning sheet but then they still coming balance to and for away will the process are XXXX, one last up, maturities just over current thought year until this go

address do preparing to those how So during think you XXXX? about

Jamie Coogan

bank of we we that ample Yes., We to refi. us are on that with as open right as here opportunity partners talking working the for are right know that. now, markets Seth, work forward with our there's trusted now, bank

goal determination of Our assessment, those take care refinancings. move make a here the to and make is sort to of

a right As pretty now. you know, attractive with the converts it's coupon though, rate

incremental We sort handle processing with absolutely, But our right and on that, credit more any as the sufficient underneath now. refinancings working do information expected our capacity have that we we'll of project agreement through to with year. but is have we're a proceed through

Seth Seifman

Right, Thanks great. very much. okay, okay

Ian Walsh

Yes.

Jamie Coogan

Thanks Seth.

Operator

One you question. Thank moment [Operator our for next Instructions]

Steve of from question Our is Barger a KeyBanc. next follow-up

line is open. Your

Steve Barger

cumulative free talk forecast? tough the has Jamie, Thanks. kind confidence a of been this in over story. to years cash your Can you few past flow

Jamie Coogan

do convert have is inventory three included the to about We we we of year, remarks K-MAX white feel some year. forecast opportunities We We've our white full the mean part sales for good this today. those prepared our the incremental forecast of the Yes. - like had have tails. not do opportunity that Steve. are as to got tail we three in I relative for cash to the talked about

that, - cash capital to drive addition order flow we In are in performance. and improved like we focused outs about, to talked cost we on working incremental

information shore more as year, opportunities the you we cash to provide course kind as incremental the further for the - of so through have as period move range. year, of our current this maybe some have flow we'll well up that, And on hopefully, above

Steve Barger

- forward-looking - go more ahead? sorry, And this you of do is a

Jamie Coogan

going is of more just the positive year, cash for the we the And just everybody's to course us. we the cash would to was I expect No, the performance little flow of a move use course typically sort a for through year. mention, bit over of think turn sake, QX as we as flows of right about

Steve Barger

free margin. view forward, flow question flow I more looking ultimately like? yet should - How cash going what asked whatever look Is question Products should or Yes, this through? Do understood. Engineered on margin And you on free portfolio cash it's a it to trends flow SG&A, have on towards similar produce? a

Jamie Coogan

we Engineered expect right, we probably group to peer set, it to be the look would from that Products Steve. at an would Yes, akin perspective,

So structure the cost consistent think that that to target move inventory with in a Kaman. that's those ability and where that RBC, get manner types in goal way, cash. about their That's about and is goal here generate an for is businesses line, folks a in of to our those think is

Steve Barger

double that low So high digit, right? single, seem does

Jamie Coogan

Yes, yes.

Steve Barger

a through burst from fire when standpoint the revenue? you can to for letter that how approval and plan manufacturing cash works and talk use business the facility, turns assembly And that

Jamie Coogan

commitments entered award is, our associated that program. UAE, of our you there recall, some to credits what the initial inside XX-K. we we that so disclosures with footnote Yes, may When some is into this provide - on with offset had got we

that requirements. venture There meaningful fire some forward. is the we anything until of contribution, we as to satisfying agreement really be move offset joint incremental don't way will cash but our and burst XXXX So expect be those

Ian Walsh

to was would just to milestone something to burst potential which world. Steve, just joint orders, add add just also move DCS relative IDEX. got thinking We of our venture a and the but place, part in forward, huge to that. that fire We future about Yes

other we flow to milestone. was The cash from huge I had a another mention thing was going perspective,

approval. readiness this a review Just we had week, production

been on This was our to back and we've which A-XX towards. program, waiting working

program another, to and for Wichita us out get start we with year that's the again, So upside the really A-XX as door Jacksonville. from this product

Steve Barger

ask transcript. pretty said more. Is I on revenue back is check for you just I But EBITDA in that were heavier Jamie, as one true I'll And Sounds half. fast you guidance, good. so the think the well? can going

Jamie Coogan

whether we to vacation work start our accruals, through absorption. builds happens, year, that be we the What the course the it we as in quarter year, accounting much. moved happens over of some we're We get other the Not types And accruals way right as second like the volume establishing. the of that as get year, of first, through. it the through be the Steve, better of of course whether

So cadence the have of process. that's natural we our through that sort

we probably make little So as we're trying have that have and inherently that back-end trying to performance. always us bit on to basis. - little relative to that even - will be are a our weighted this goal a is bit But a year, more demonstrate quarterly

Steve Barger

Right, so of EBITDA even, little because in more front and but little heavier a half? a the accruals such revenue the

Jamie Coogan

less. Yes, more or

Steve Barger

you. Thank it. got Okay,

Jamie Coogan

Yes.

Operator

the queue. to the in seeing, I'm conference Stath you. no remarks. closing turn Ms. questions to I now further would for Thank back Becky like

Rebecca Stath

Thank you with to conference we when us our report We joining you speaking look today's first quarter on forward again call. results. for

Operator

all concludes you call. conference This today's Thank participating. for

You your a and may weekend. day, pleasant enjoy Have now disconnect.

Kaman (KAMN) 24 Feb 232022 Q4 Earnings call transcript