Third Quarter 2023 Results
T R U S T E D W H E R E V E R
T H E M I S S I O N L E A D S
No v ember 6 , 2 0 23
Disclaimers
FORWARD-LOOKING STATEMENTS
This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), and Section 27A of the Securities Act of 1933, as amended (the Securities Act), and the Private Securities Litigation Reform Act of 1995 and, as such, may involve risks and uncertainties. All statements included or incorporated by reference in this presentation, other than statements that are purely historical, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "could," "potential," "continue" or similar terminology. These statements are based on the beliefs and assumptions of the management of the Company based on information currently available to management. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements.
We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the Company's historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to: our ability to submit proposals for and/or win all potential opportunities in our pipeline; our ability to retain and renew our existing contracts; our ability to compete with other companies in our market; security breaches and other disruptions to our information technology and operation; our mix of cost-plus,cost-reimbursable, and firm-fixed-price contracts; maintaining our reputation and relationship with the U.S. government; protests of new awards; economic, political and social conditions in the countries in which we conduct our businesses; changes in U.S. or international government defense budgets; government regulations and compliance therewith, including changes to the DoD procurement process; changes in technology; intellectual property matters; governmental investigations, reviews, audits and cost adjustments; contingencies related to actual or alleged environmental contamination, claims and concerns; delays in completion of the U.S. government's budget; our success in extending, deepening, and enhancing our technical capabilities; our success in expanding our geographic footprint or broadening our customer base; our ability to realize the full amounts reflected in our backlog; impairment of goodwill; misconduct of our employees, subcontractors, agents, prime contractors and business partners; our ability to control costs; our level of indebtedness; terms of our credit agreement; inflation and interest rate risk; geopolitical risk, including as a result of recent international events; subcontractor performance; economic and capital markets conditions; our ability to maintain safe work sites and equipment; our ability to retain and recruit qualified personnel; our ability to maintain good relationships with our workforce; our teaming relationships with other contractors; changes in our accounting estimates; the adequacy of our insurance coverage; volatility in our stock price; changes in our tax provisions or exposure to additional income tax liabilities; risks and uncertainties relating to the Merger; risks and uncertainties relating to the Spin-off; changes in accounting principles generally accepted in the United States ("GAAP"); and other factors described in Item 1A, "Risk Factors" and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2022 and described in our other filings with the SEC.
Use of Projections
The financial projections, estimates and targets in this presentation are forward-looking statements that are based on assumptions that are inherently subject to significant uncertainties and contingencies,
many of which are beyond the V2X's control. The assumptions and estimates underlying the projected, expected or target results are inherently uncertain and are subject to a wide variety of significant
business, economic and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the financial projections, estimates and targets. The inclusion of financial projections, estimates and targets in this presentation should not be regarded as an indication that V2X or its representatives considered or consider the financial projections, estimates and targets to be a reliable prediction of future events.
Use of Non-GAAP Financial Measures
This presentation includes certain non-GAAP financial measures that are not prepared in accordance with GAAP, including forward-looking measures, which may be different from non-GAAP financial measures used by other companies. These non- GAAP measures, and other measures that are calculated using these non-GAAP measures, are an addition, and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP and should not be considered as an alternative to operating income, net income or any other performance measures derived in accordance with GAAP. We have provided additional information regarding these measures in the Appendix to this presentation. Reconciliations of our forward-lookingnon-GAAP measures to the closest corresponding GAAP measures are not available without unreasonable efforts due to the uncertainties discussed above, which could have a potentially significant impact on our future results.
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Environmental, Social, & Governance Report
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Q3'23 Summary
- Record revenue of $1.0B, up 5% y/y; driven by growth in CENTCOM and INDOPACOM
- Adjusted EBITDA1 of $64.7M; Adjusted diluted EPS1 of $0.73
- Strong year-to-date adjusted operating cash flow of $83.6M; lowered net debt $89M
- Record backlog of $13.3B, awards of $1.3B in Q3 with a 1.3x book-to-bill
- Booked $440M Naval Test Wing Pacific award and achieved full operational capability
- Awarded $190M Training & Range Operations Services contract in CENTCOM
- New $85M award to support existing DoD water purification efforts
- Awarded $458M F-5 Adversary Aircraft program2 for the Navy and Marine Corps
- Expanded work scope awards of $332M in Q3 driven by client engagement and favorable demand environment
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- See appendix for reconciliation of non-GAAP measures
- Subsequent to Q3'23
Delivering Global Training Solutions
V2X was awarded the United States Army Central Command (USARCENT) Training and Range Operations Maintenance Services Contract (ATROMS)
ATROMS supports the Army's efforts to continue enhancing the warfighting skills of U.S. training units via the use of Live and Virtual training in
CENTCOM
V2X will provide Training Support Services as well as Instruction, Operation, and Maintenance of Training Aids, Devices, Simulators, and Simulations, fixed ranges, deployable ranges, and numerous training facilities
This recompete win leveraged V2X's decades of experience providing global training capabilities as well as our footprint in CENTCOM
Demonstrates V2X ability to deliver mission critical converged solutions
- Our global footprint and capability set across high consequence training, logistics, mission support, battlefield communications, MRO, and modernization serve as a differentiator
USARCENT TRAINING & RANGE
OPERATIONS SOLUTIONS
Period of Performance:
- Five-Years
Contract Value:
- $190 million
Contract Type:
- Firm-Fixed Price with cost- reimbursable line items for materials, travel, and other direct costs
Location:
- Primarily conducted in Kuwait at the Udairi Range Complex, the USARCENT Readiness Training Center, and the Training Support Centers
UH-60 photo source: U.S. Army | 5 |
Providing Full Mission Lifecycle Solutions
High Consequence Training
ATROMS STE JMRC
Upgrades and Modernization
Cobra Dane F-16 CDU | |
LAU-115 |
Maintenance, Modification, Repair, Overhaul
T-45 | SECREPS | Global strike |
Readiness / Logistics / Deployment
Ft. Moore | 5G Smart | |
Ft. Liberty | ||
Warehouse |
Mission / Infrastructure Support
Neutral LOGCAP V GCSMAC
Buoyancy Lab
Connectivity & Communications
GMR-1000 OMDAC Spectrum
Management
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Awards Driving Record Backlog
Backlog ($B)
$11.8
$13.0$13.3
•
•
•
Q3'23 awards of $1.3 billion with a 1.3x book-to-bill
Record Q3'23 backlog of $13.3 billion
Funded backlog of $3.2 billion provides strong revenue visibility
Q1'23 | Q2'23 | Q3'23 |
$6B of bids pending award and $19B of bids to submit over next twelve months
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Q3'23 Financial Results
Revenue ($M) | Adjusted EBITDA1 ($M) | Adj. Diluted EPS1 |
$958.2 | $1,001.5 | $80.0 | $1.35 |
$64.7 | |||
$0.73
Q3'22 | Q3'23 | Q3'22 | Q3'23 | Q3'22 | Q3'23 |
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1 See appendix for reconciliation of non-GAAP measures
Geographic, Contract and Client Composition
Geographic Region1 | Contract Type1 | Client Mix1 | |||
Europe | T&M | Army | |||
US | Cost | 41% | |||
5% | 4% | Other | |||
54% | |||||
58% | |||||
14% | |||||
Asia | |||||
7% | |||||
Fixed | Air Force | Navy | |||
ME | 42% | 14% | 31% | ||
30% |
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1 Year-to-date Q3 2023 revenue composition
Cash Flow and Liquidity
Q3'23 Debt & Net Debt | Net Debt Improvement | |
($M) | ($M) | |
$1,208.0 | $1,220.7 |
$1,131.8 | $1,131.8 |
Gross Debt | Net Debt | Q4'22 | Q3'23 |
- Year-to-dateQ3'23 adjusted operating cash flow2 of $83.6 million
- Lowered net debt by $88.9 million year-to-date
- Net leverage ratio1 at 3.46x
- Successful repricing on Term Loan B
- Strong liquidity with over ~$500 million of capacity; $434 million revolver and ~$76 million of unrestricted cash on balance sheet
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- Net leverage ratio equals net debt of $1,131.8M divided by trailing twelve-month (TTM) bank EBITDA
- Adjusted operating cash flow equals net cash provided by operating activities of $135.2M + $20.9M of M&A, integration, and related payments + $13.4M CARES Act - $85.8M MARPA facility activity
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V2X Inc. published this content on 06 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 06 November 2023 12:49:06 UTC.