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Curtiss-Wright (CW) Q3 Earnings Top Estimates, Sales Up Y/Y
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Shares of Curtiss-Wright Corporation (CW - Free Report) rose 4% to reach $134.65 on Nov 8, reflecting investors’ optimism following its third-quarter results.
The company reported third-quarter 2021 adjusted earnings of $1.88 per share, which surpassed the Zacks Consensus Estimate of $1.80 by 4.4%. Moreover, the bottom line grew 6% on a year-over-year basis.
Excluding one-time items, the company reported GAAP earnings of $1.70 per share compared with $1.55 reported in the year-ago quarter.
CurtissWright Corporation Price, Consensus and EPS Surprise
In the quarter under review, the company’s total sales of $620.6 million increased 8.6% year over year. The top line also exceeded the Zacks Consensus Estimate of $601 million by 3.3%.
The company reported adjusted sales of $614 million, which went up 12% year over year.
Gross profit increased 11.4% year over year to $237 million. Operating income of $97.7 million improved 15.5% from $84.6 million a year ago.
Curtiss-Wright’s total backlog at the end of the third quarter of 2021 was $2.2 billion. New orders of $617 million increased 13% from the prior-year period, driven by solid demand for the company’s commercial aerospace and defense electronics products, as well as for industrial vehicle products.
Segmental Performance
Aerospace & Industrial: Adjusted sales in this segment improved 14% year over year to $195.9 million, primarily attributable to higher general industrial market revenues driven by a continued strong rebound in industrial vehicle product demand for on- and off-highway platforms in response to the economic recovery. Commercial aerospace market revenues were driven by higher sales of sensors products and surface treatment services on narrowbody platforms, contributing to this unit’s revenue growth.
While adjusted operating income increased 34% to $30.8 million, the operating margin expanded 240 basis points (bps) to 15.7%. The upside was driven by strong absorption on higher sales and the benefits of the company’s ongoing operational excellence, and prior-year restructuring initiatives.
Defense Electronics: Adjusted sales in this segment grew 22% year over year to $182.6 million. This uptick can be attributed to the contribution from the PacStar acquisition for tactical battlefield communications equipment within the company’s ground defense market.
Adjusted operating income rose 9% to $42.3 million while adjusted operating margin contracted 270 bps to 23.2%. A favorable mix in defense electronics was more than offset by higher research and development investments and unfavorable foreign currency translation.
Naval & Power: Adjusted sales in this segment increased 3% year over year to $235.3 million on account of higher revenues on the Virginia-class submarine and CVN-81 aircraft carrier programs.
While operating income rose 4% to $43.9 million, the operating margin expanded 20 bps to 18.6%. The upside was primarily driven by solid absorption on higher revenues, as well as the benefits of its prior-year restructuring initiatives.
Financial Update
Curtiss-Wright ended the third quarter of 2021 with cash and cash equivalents of $234.4 million, up from $198.2 million as of Dec 31, 2020. Long-term debt was $957.1 million as of Sep 30, 2021, compared with $958.3 million as of Dec 31, 2020.
Operating cash flow totaled $155.8 million at the end of third-quarter 2021 compared with $3.8 million in the prior-year period.
Adjusted free cash flow at the end of the reported quarter was $127.9 million compared with the year-ago period’s $138.2 million.
2021 Guidance
Curtiss-Wright updated its financial guidance for 2021. The company now expects adjusted earnings in the range of $7.20-$7.35 per share, compared with the prior guidance range of $7.15-$7.35 per share.
The Zacks Consensus Estimate for the company’s full-year earnings is pegged at $7.21 per share, which lies below the midpoint of the company’s guided range.
The company still expects to generate sales in the range of $2,465-$2,515 million in 2021. The Zacks Consensus Estimate for its full-year sales is pegged at $2,490 million, in line with the midpoint of the company-guided range.
Leidos Holdings, Inc.’s (LDOS - Free Report) third-quarter 2021 adjusted earnings of $1.80 per share exceeded the Zacks Consensus Estimate of $1.60 by 12.5%.
L3Harris Technologies, Inc.’s (LHX - Free Report) third-quarter 2021 adjusted earnings came in at $3.21 per share, which surpassed the Zacks Consensus Estimate of $3.16 by 1.6%.
Hexcel Corporation (HXL - Free Report) reported third-quarter 2021 adjusted earnings of 13 cents per share, which exceeded the Zacks Consensus Estimate of 8 cents by 62.5%.
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Curtiss-Wright (CW) Q3 Earnings Top Estimates, Sales Up Y/Y
Shares of Curtiss-Wright Corporation (CW - Free Report) rose 4% to reach $134.65 on Nov 8, reflecting investors’ optimism following its third-quarter results.
The company reported third-quarter 2021 adjusted earnings of $1.88 per share, which surpassed the Zacks Consensus Estimate of $1.80 by 4.4%. Moreover, the bottom line grew 6% on a year-over-year basis.
Excluding one-time items, the company reported GAAP earnings of $1.70 per share compared with $1.55 reported in the year-ago quarter.
CurtissWright Corporation Price, Consensus and EPS Surprise
CurtissWright Corporation price-consensus-eps-surprise-chart | CurtissWright Corporation Quote
Operational Performance
In the quarter under review, the company’s total sales of $620.6 million increased 8.6% year over year. The top line also exceeded the Zacks Consensus Estimate of $601 million by 3.3%.
The company reported adjusted sales of $614 million, which went up 12% year over year.
Gross profit increased 11.4% year over year to $237 million. Operating income of $97.7 million improved 15.5% from $84.6 million a year ago.
Curtiss-Wright’s total backlog at the end of the third quarter of 2021 was $2.2 billion. New orders of $617 million increased 13% from the prior-year period, driven by solid demand for the company’s commercial aerospace and defense electronics products, as well as for industrial vehicle products.
Segmental Performance
Aerospace & Industrial: Adjusted sales in this segment improved 14% year over year to $195.9 million, primarily attributable to higher general industrial market revenues driven by a continued strong rebound in industrial vehicle product demand for on- and off-highway platforms in response to the economic recovery. Commercial aerospace market revenues were driven by higher sales of sensors products and surface treatment services on narrowbody platforms, contributing to this unit’s revenue growth.
While adjusted operating income increased 34% to $30.8 million, the operating margin expanded 240 basis points (bps) to 15.7%. The upside was driven by strong absorption on higher sales and the benefits of the company’s ongoing operational excellence, and prior-year restructuring initiatives.
Defense Electronics: Adjusted sales in this segment grew 22% year over year to $182.6 million. This uptick can be attributed to the contribution from the PacStar acquisition for tactical battlefield communications equipment within the company’s ground defense market.
Adjusted operating income rose 9% to $42.3 million while adjusted operating margin contracted 270 bps to 23.2%. A favorable mix in defense electronics was more than offset by higher research and development investments and unfavorable foreign currency translation.
Naval & Power: Adjusted sales in this segment increased 3% year over year to $235.3 million on account of higher revenues on the Virginia-class submarine and CVN-81 aircraft carrier programs.
While operating income rose 4% to $43.9 million, the operating margin expanded 20 bps to 18.6%. The upside was primarily driven by solid absorption on higher revenues, as well as the benefits of its prior-year restructuring initiatives.
Financial Update
Curtiss-Wright ended the third quarter of 2021 with cash and cash equivalents of $234.4 million, up from $198.2 million as of Dec 31, 2020.
Long-term debt was $957.1 million as of Sep 30, 2021, compared with $958.3 million as of Dec 31, 2020.
Operating cash flow totaled $155.8 million at the end of third-quarter 2021 compared with $3.8 million in the prior-year period.
Adjusted free cash flow at the end of the reported quarter was $127.9 million compared with the year-ago period’s $138.2 million.
2021 Guidance
Curtiss-Wright updated its financial guidance for 2021. The company now expects adjusted earnings in the range of $7.20-$7.35 per share, compared with the prior guidance range of $7.15-$7.35 per share.
The Zacks Consensus Estimate for the company’s full-year earnings is pegged at $7.21 per share, which lies below the midpoint of the company’s guided range.
The company still expects to generate sales in the range of $2,465-$2,515 million in 2021. The Zacks Consensus Estimate for its full-year sales is pegged at $2,490 million, in line with the midpoint of the company-guided range.
Zacks Rank
Curtiss-Wright currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Defense Releases
Leidos Holdings, Inc.’s (LDOS - Free Report) third-quarter 2021 adjusted earnings of $1.80 per share exceeded the Zacks Consensus Estimate of $1.60 by 12.5%.
L3Harris Technologies, Inc.’s (LHX - Free Report) third-quarter 2021 adjusted earnings came in at $3.21 per share, which surpassed the Zacks Consensus Estimate of $3.16 by 1.6%.
Hexcel Corporation (HXL - Free Report) reported third-quarter 2021 adjusted earnings of 13 cents per share, which exceeded the Zacks Consensus Estimate of 8 cents by 62.5%.