Curtiss Wright Corp 8-K, filed May 4, 2023

Curtiss Wright Corp (CW)

8-K 2023-05-04 For: 2023-05-03

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Added on April 09, 2026

About this 8-K

Curtiss Wright Corp filed this 8-K on May 4, 2023, reporting on events of May 3, 2023.

Items reported

Item 2.02: Financial results
Item 9.01: Financial statements and exhibits

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Delaware		001-00134		13-0612970
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

130 Harbour Place Drive, Suite 300
Davidson, NC	28036
(Address of Principal Executive Offices)	(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	CW	New York Stock Exchange

	CURTISS-WRIGHT CORPORATION

	By:	/s/ K. Christopher Farkas
		K. Christopher Farkas Vice-President and Chief Financial Officer

Exhibit Number		Description

99.1		Press Release dated May 3, 2023
99.2		Presentation shown during investor and securities analyst webcast on May 4, 2023

Curtiss Wright Corp 8-K, filed May 4, 2023

About this 8-K

Items reported

Curtiss-Wright Reports First Quarter 2023 Financial Results and Reaffirms Full-year 2023 Guidance

Contacts

(In millions)	Q1-2023			Q1-2022			Change
*Reported*
Sales	$	631		$	559		13	%
Operating income	$	79		$	61		30	%
Operating margin		12.5	%		10.8	%	170 bps

*Adjusted ⁽¹⁾*
Sales	$	631		$	559		13	%
Operating income	$	81		$	71		15	%
Operating margin		12.9	%		12.7	%	20 bps

(In millions, except EPS)	2023 Adjusted Non-GAAP Guidance	% Chg vs 2022
Total Sales	$2,655 - $2,710	Up 4% - 6%
Operating Income	$463 - $477	Up 5% - 8%
Operating Margin	17.4% - 17.6%	Up 10 - 30 bps
Diluted EPS	$8.65 - $8.90	Up 6% - 10%
Free Cash Flow	$360 - $400	Up 22% - 36%

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
($'s in thousands, except per share data)

	Three Months Ended
	March 31,
		2023			2022
Product sales	$	524,881		$	453,421
Service sales		105,979			106,040
Total net sales		630,860			559,461

Cost of product sales		343,757			294,527
Cost of service sales		65,695			63,532
Total cost of sales		409,452			358,059

Gross profit		221,408			201,402

Research and development expenses		22,024			20,549
Selling expenses		32,425			28,092
General and administrative expenses		88,344			87,600
Loss on divestiture		—			4,651

Operating income		78,615			60,510

Interest expense		12,944			9,530
Other income, net		7,767			2,997

Earnings before income taxes		73,438			53,977
Provision for income taxes		(16,592	)		(13,292	)
Net earnings	$	56,846		$	40,685

Net earnings per share:
Basic earnings per share	$	1.48		$	1.06
Diluted earnings per share	$	1.48		$	1.05

Dividends per share	$	0.19		$	0.18

Weighted average shares outstanding:
Basic		38,303			38,456
Diluted		38,516			38,668

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
($'s in thousands, except par value)

	March 31,			December 31,
		2023			2022
Assets
Current assets:
Cash and cash equivalents	$	130,659		$	256,974
Receivables, net		720,248			724,603
Inventories, net		527,937			483,113
Other current assets		67,415			52,623
Total current assets		1,446,259			1,517,313
Property, plant, and equipment, net		340,313			342,708
Goodwill		1,549,148			1,544,635
Other intangible assets, net		605,217			620,897
Operating lease right-of-use assets, net		145,017			153,855
Prepaid pension asset		227,547			222,627
Other assets		48,624			47,567
Total assets	$	4,362,125		$	4,449,602

Liabilities
Current liabilities:
Current portion of long-term and short term debt	$	—		$	202,500
Accounts payable		207,573			266,525
Accrued expenses		153,678			177,536
Deferred revenue		234,487			242,483
Other current liabilities		76,452			82,395
Total current liabilities		672,190			971,439
Long-term debt, net		1,229,619			1,051,900
Deferred tax liabilities		122,607			123,001
Accrued pension and other postretirement benefit costs		58,062			58,348
Long-term operating lease liability		124,025			132,275
Long-term portion of environmental reserves		13,171			12,547
Other liabilities		88,292			107,973
Total liabilities	$	2,307,966		$	2,457,483

Stockholders' equity
Common stock, $1 par value	$	49,187		$	49,187
Additional paid in capital		126,909			134,553
Retained earnings		3,223,944			3,174,396
Accumulated other comprehensive loss		(244,442	)		(258,916	)
Less: cost of treasury stock		(1,101,439	)		(1,107,101	)
Total stockholders' equity		2,054,159			1,992,119

Total liabilities and stockholders' equity	$	4,362,125		$	4,449,602

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
RECONCILIATION OF AS REPORTED TO ADJUSTED (UNAUDITED)
($'s in thousands)

	Three Months Ended								Three Months Ended
	March 31, 2023								March 31, 2022								% Change
	As Reported			Adjustments		Adjusted			As Reported			Adjustments		Adjusted			Reported		Adjusted
Sales:
Aerospace & Industrial	$	202,447		$	—	$	202,447		$	191,112		$	—	$	191,112		6	%	6	%
Defense Electronics		162,154			—		162,154			143,069			—		143,069		13	%	13	%
Naval & Power		266,259			—		266,259			225,280			—		225,280		18	%	18	%

Total sales	$	630,860		$	—	$	630,860		$	559,461		$	—	$	559,461		13	%	13	%

Operating income (expense):
Aerospace & Industrial	$	26,545		$	—	$	26,545		$	24,853		$	—	$	24,853		7	%	7	%
Defense Electronics		23,368			—		23,368			23,290			—		23,290		—	%	—	%
Naval & Power ⁽¹⁾⁽²⁾		37,937			2,676		40,613			27,288			5,427		32,715		39	%	24	%

Total segments	$	87,850		$	2,676	$	90,526		$	75,431		$	5,427	$	80,858		16	%	12	%
Corporate and other ⁽³⁾		(9,235	)		—		(9,235	)		(14,921	)		4,876		(10,045	)	38	%	8	%

Total operating income	$	78,615		$	2,676	$	81,291		$	60,510		$	10,303	$	70,813		30	%	15	%

Operating margins:	As Reported					Adjusted			As Reported					Adjusted			Reported		Adjusted
Aerospace & Industrial		13.1	%				13.1	%		13.0	%				13.0	%	10 bps		10 bps
Defense Electronics		14.4	%				14.4	%		16.3	%				16.3	%	(190 bps)		(190 bps)
Naval & Power		14.3	%				15.3	%		12.1	%				14.5	%	220 bps		80 bps
Total Curtiss-Wright		12.5	%				12.9	%		10.8	%				12.7	%	170 bps		20 bps

Segment margins		13.9	%				14.3	%		13.5	%				14.5	%	40 bps		(20 bps)

⁽¹⁾ Excludes first year purchase accounting adjustments in the current period.
⁽²⁾ Excludes the results of operations from our German valves business, which was sold in January 2022, and the loss on divestiture in the prior year period.
⁽³⁾ Excludes costs associated with shareholder activism in the prior year period.

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
RECONCILIATION OF AS REPORTED SALES TO ADJUSTED SALES BY END MARKET (UNAUDITED)
($'s in thousands)

	Three Months Ended						Three Months Ended
	March 31, 2023						March 31, 2022						2023 vs. 2022
	Reported Sales		Adjustments		Adjusted Sales		Reported Sales		Adjustments		Adjusted Sales		Change in Reported Sales		Change in Adjusted Sales
Aerospace & Defense markets:
Aerospace Defense	$	99,879	$	—	$	99,879	$	98,004	$	—	$	98,004	2	%	2	%
Ground Defense		66,256		—		66,256		39,108		—		39,108	69	%	69	%
Naval Defense		171,956		—		171,956		162,967		—		162,967	6	%	6	%
Commercial Aerospace		70,490		—		70,490		60,892		—		60,892	16	%	16	%
Total Aerospace & Defense	$	408,581	$	—	$	408,581	$	360,971	$	—	$	360,971	13	%	13	%

Commercial markets:
Power & Process		120,339		—		120,339		104,788		—		104,788	15	%	15	%
General Industrial		101,940		—		101,940		93,702		—		93,702	9	%	9	%
Total Commercial	$	222,279	$	—	$	222,279	$	198,490	$	—	$	198,490	12	%	12	%

Total Curtiss-Wright	$	630,860	$	—	$	630,860	$	559,461	$	—	$	559,461	13	%	13	%

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
NON-GAAP FINANCIAL DATA (UNAUDITED)
($'s in thousands)


	Three Months Ended
	March 31,
	2023			2022
Net cash used for operating activities	$	(91,599	)	$	(124,315	)
Capital expenditures		(10,661	)		(10,896	)
Free cash flow	$	(102,260	)	$	(135,211	)
Westinghouse legal settlement		10,000			15,000
Pension payment to former executive		—			8,214
Adjusted free cash flow	$	(92,260	)	$	(111,997	)
Adjusted free cash flow conversion		(157	%)		(221	%)

CURTISS-WRIGHT CORPORATION
2023 Guidance
As of May 3, 2023
($'s in millions, except per share data)

	2022 Reported (GAAP)			2022 Adjustments (Non-GAAP)^(1,3)			2022 Adjusted (Non-GAAP)^(1,3)			2023 Reported Guidance (GAAP)						2023 Adjustments (Non-GAAP)^(2,3)			2023 Adjusted Guidance (Non-GAAP)^(2,3)
										Low			High						Low			High			Chg vs 2022 Adjusted
Sales:
Aerospace & Industrial	$	836		$	—		$	836		$	845		$	860		$	—		$	845		$	860		1 - 3%
Defense Electronics		690			—			690			725			750			—			725			750		5 - 9%
Naval & Power		1,031			—			1,031			1,085			1,100			—			1,085			1,100		5 - 7%
Total sales	$	2,557		$	—		$	2,557		$	2,655		$	2,710		$	—		$	2,655		$	2,710		4 to 6%

Operating income:
Aerospace & Industrial	$	137		$	1		$	138		$	143		$	148		$	—		$	143		$	148		4 - 7%
Defense Electronics		155			—			155			165			172			—			165			172		7 - 11%
Naval & Power		178			14			192			182			186			8			190			194		(1) - 1%
Total segments		469			15			484			490			506			8			498			514
Corporate and other		(46	)		5			(41	)		(35	)		(38	)		—			(35	)		(38	)
Total operating income	$	423		$	20		$	443		$	455		$	469		$	8		$	463		$	477		5 to 8%

Interest expense	$	(47	)	$	—		$	(47	)	$	(52	)	$	(54	)	$	—		$	(52	)	$	(54	)
Other income, net		13			4			17			27			28			—			27			28
Earnings before income taxes		389			24			413			430			443			8			438			451
Provision for income taxes		(95	)		(4	)		(99	)		(103	)		(106	)		(2	)		(105	)		(108	)
Net earnings	$	294		$	20		$	314		$	327		$	336		$	6		$	333		$	343

Diluted earnings per share	$	7.62		$	0.51		$	8.13		$	8.49		$	8.74		$	0.16		$	8.65		$	8.90		6 to 10%
Diluted shares outstanding		38.6						38.6			38.5			38.5						38.5			38.5
Effective tax rate		24.4	%					24.0	%		24.0	%		24.0	%					24.0	%		24.0	%

Operating margins:
Aerospace & Industrial		16.4	%					16.5	%		17.0	%		17.2	%					17.0	%		17.2	%	50 to 70 bps
Defense Electronics		22.4	%					22.4	%		22.7	%		22.9	%					22.7	%		22.9	%	30 to 50 bps
Naval & Power		17.2	%					18.6	%		16.7	%		16.9	%					17.5	%		17.7	%	(110) to (90) bps
Total operating margin		16.6	%					17.3	%		17.1	%		17.3	%					17.4	%		17.6	%	10 to 30 bps

Free cash flow	$	257		$	39		$	296		$	350		$	390		$	10		$	360		$	400

Notes: Full year amounts may not add due to rounding.
⁽¹⁾ 2022 Adjusted financials exclude the impact of first year purchase accounting adjustments, the loss on sale of our German valves business, costs associated with shareholder activism and pension settlement charges related to the retirement of two former executives.
⁽²⁾ 2023 Adjusted financials exclude the impact of first year purchase accounting adjustments.
⁽³⁾Free Cash Flow is defined as cash flow from operations less capital expenditures. 2022 Adjusted Free Cash Flow excluded one-time pension settlement payments of $24 million and a legal settlement payment of $15 million. 2023 Adjusted Free Cash Flow guidance excludes a legal settlement payment of $10 million.

CURTISS-WRIGHT CORPORATION
2023 Sales Growth Guidance by End Market
As of May 3, 2023



	2023 % Change
	vs 2022 Adjusted⁽¹⁾	% Total Sales
Aerospace & Defense Markets
Aerospace Defense	9 - 11%	20%
Ground Defense	4 - 6%	9%
Naval Defense	4 - 6%	27%
Commercial Aerospace	5 - 7%	11%
Total Aerospace & Defense	6 - 8%	67%

Commercial Markets
Power & Process	Flat	18%
General Industrial	2 - 4%	16%
Total Commercial	0 - 2%	33%

Total Curtiss-Wright Sales	4 - 6%	100%

Note: Sales percentages may not add due to rounding.
⁽¹⁾ 2023 and 2022 Sales include the contribution from the engineered arresting systems business, acquired on June 30, 2022, to the Aerospace Defense market.