10-KPeriod: FY2022

CURTISS WRIGHT CORP Annual Report, Year Ended Dec 31, 2022

Filed February 22, 2023For Securities:CW

Summary

Curtiss-Wright Corporation (CW) reported solid performance in its fiscal year 2022, driven by growth in its Aerospace & Industrial and Naval & Power segments. Total sales increased by 2% to $2.56 billion, with operating income rising 11% to $423 million, reflecting improved operating margins across key segments. The company continues to benefit from its strong position in defense markets, with significant revenue derived from U.S. government contracts. The Aerospace & Industrial segment saw a 6% increase in sales, primarily from general industrial and commercial aerospace markets, while the Naval & Power segment experienced a 4% sales increase, bolstered by acquisitions and demand in naval defense. The Defense Electronics segment, however, saw a 5% decline in sales due to ongoing supply chain challenges. Financially, Curtiss-Wright demonstrated strong cash flow generation and maintained a healthy balance sheet. The company repurchased $57 million in stock and paid $29 million in dividends, indicating a commitment to returning capital to shareholders. Management expects continued growth in defense spending to support future performance, although it remains watchful of inflationary pressures and supply chain disruptions impacting its commercial businesses.

Financial Highlights

54 data points
Beta

Revenue

$2.56B

37.3% Gross Margin

Net Income

$294.35M

11.5% Net Margin

EPS (Diluted)

$7.62

Total Assets

$4.45B

Cash & Equivalents

$256.97M

Free Cash Flow

$256.56M

Financial Statements
Beta
Revenue$2.56B
Cost of Revenue$1.60B
Gross Profit$954.61M
R&D Expenses$80.84M
Operating Income$423.44M
Interest Expense$46.98M
Net Income$294.35M
EPS (Basic)$7.67
EPS (Diluted)$7.62
Shares Outstanding (Basic)38.39M
Shares Outstanding (Diluted)38.65M

Key Highlights

  • 1Total sales increased by 2% to $2.56 billion in 2022.
  • 2Operating income increased by 11% to $423 million, with operating margin improving by 130 basis points.
  • 3Aerospace & Industrial segment sales grew 6% to $836 million, driven by industrial and commercial aerospace markets.
  • 4Naval & Power segment sales increased 4% to $1.03 billion, supported by acquisitions and strong defense demand.
  • 5Defense Electronics segment sales decreased 5% to $690 million due to supply chain headwinds.
  • 6The company ended the year with a strong backlog of $2.6 billion, up 18% year-over-year.
  • 7Curtiss-Wright repurchased $57 million of its common stock and paid $29 million in dividends during 2022.

Frequently Asked Questions

Revenue growth was primarily driven by the Aerospace & Industrial segment, which saw increased demand in general industrial and commercial aerospace markets, and the Naval & Power segment, benefiting from acquisitions and strong demand in naval defense. Growth in U.S. defense spending also contributed positively.

The primary challenges faced by Curtiss-Wright included ongoing supply chain headwinds that negatively impacted the Defense Electronics segment, leading to lower sales volumes. The company also noted inflationary pressures on material, labor, and services, although it has generally been able to pass these costs on to customers.

Curtiss-Wright focused on returning capital to shareholders by repurchasing $57 million of its common stock and paying $29 million in dividends. The company also invested in growth through acquisitions, spending $282 million on two businesses. Its balance sheet remained strong, with significant unused credit capacity.

The company anticipates a favorable demand environment and continued growth in global defense spending, particularly from U.S. DoD budgets and NATO countries. This outlook is supported by government spending on modernization efforts and emerging technological trends in defense.