Curtiss-Wright (CW) Tops Q2 EPS by 52c, Revenues Beat; Boosts FY18 EPS Guidance

Curtiss-Wright (NYSE: CW) reported Q2 EPS of $1.80, $0.52 better than the analyst estimate of $1.28. Revenue for the quarter came in at $620 million versus the consensus estimate of $616.3 million.

Second Quarter 2018 Highlights

• Reported (GAAP) diluted earnings per share (EPS) of $1.68, with Adjusted (non-GAAP) diluted EPS of $1.80, up 49% compared with the prior year, excluding first year acquisition-related purchase accounting costs;
• Net sales of $620 million, up 9%, including 4% organic growth (defined below);
• Reported (GAAP) operating income of $102 million, with Adjusted (non-GAAP) operating income of $109 million, up 28%;
• Reported (GAAP) operating margin of 16.5%, with Adjusted (non-GAAP) operating margin of 17.6%, up 260 basis points;
• Free cash flow of $87 million, up 19%;
• New orders of $700 million, up 28%; and
• Share repurchases of approximately $34 million.

Full-Year 2018 Business Outlook

• Increased Reported (GAAP) full-year 2018 diluted EPS guidance by $0.28 reflecting strong operational performance in core business;
• Introduced Adjusted (non-GAAP) full-year 2018 diluted EPS guidance, which reflects a $0.25 adjustment for first year acquisition-related purchase accounting costs associated with the acquisition of DRG;
• Combining these items, introduced Adjusted (non-GAAP) full-year 2018 diluted EPS guidance range of $6.00 to $6.15, up $0.53 compared to the prior Reported guidance range of $5.47 to $5.62 (see table below);
• Full-year 2018 Adjusted guidance reflects higher sales (up 8-9%), operating income (up 11-14%), operating margin of 15.2% to 15.4% (up 50-70 bps) and diluted EPS (up 21-24%), compared with Adjusted 2017 financial results; and
• Increased Reported free cash flow by $10 million to new range of $250 to $270 million and Adjusted free cash flow range of $300 to $320 million, which excludes a $50 million voluntary pension contribution made in the first quarter of 2018.

“We generated strong second quarter results which exceeded our expectations, as we delivered solid 9% top-line growth led by strong defense and industrial sales, and improved profitability driven by the benefits of our ongoing margin improvement initiatives, to produce Adjusted diluted EPS of $1.80,” said David C. Adams, Chairman and CEO of Curtiss-Wright Corporation.

“As a result of the strong first half results and our outlook for continued momentum through the remainder of this year, we have increased our full-year revenue, EPS and free cash flow guidance. We are projecting another solid operational performance including higher sales in all end markets, double-digit growth in operating income driving strong margin expansion and solid free cash flow generation.”

GUIDANCE:

Curtiss-Wright sees FY2018 EPS of $6.00-$6.15, versus the consensus of $5.63.

For earnings history and earnings-related data on Curtiss-Wright (CW) click here.

You May Also Be Interested In

• Micron surges 5.5% on blockbuster Anthropic AI deal ahead of earnings
• Wintermar acquires full control of Fast Offshore Supply, adding 5 new CTVs
• Alphabet slides over 6% as AI brain drain and SpaceX slump converge