10-QPeriod: Q1 FY2002

CURTISS WRIGHT CORP Quarterly Report for Q1 Ended Mar 31, 2002

Filed May 15, 2002For Securities:CW

Summary

Curtiss-Wright Corporation's (CW) Q1 2002 filing shows a solid revenue increase of 22% to $97.8 million, driven significantly by acquisitions made in 2001. Excluding these acquisitions, organic revenue grew a modest 2%, indicating continued underlying business activity. The company reported net earnings of $9.3 million, which were flat year-over-year on a reported basis, translating to $0.90 per diluted share for both periods. However, excluding certain one-time items in Q1 2002, normalized earnings showed a 4% increase, suggesting operational improvements. Financially, the company maintained a strong liquidity position with a current ratio of 3.5:1. A significant event post-quarter was the April 1, 2002 acquisition of Penny and Giles and Autronics for $60 million, expanding its presence in aerospace and defense markets. Furthermore, on May 13, 2002, CW entered into new credit agreements totaling $225 million, enhancing its financial flexibility. Investors should note the company's strategic acquisitions and its continued focus on integrating these businesses while managing operational performance across its diverse segments.

Key Highlights

  • 1Revenue increased 22% to $97.8 million in Q1 2002, largely due to acquisitions completed in 2001.
  • 2Net earnings were $9.3 million, flat year-over-year, with diluted EPS of $0.90 for both Q1 2002 and Q1 2001.
  • 3Excluding certain one-time items, normalized net earnings in Q1 2002 increased 4% year-over-year.
  • 4The company completed a significant acquisition of Penny and Giles and Autronics on April 1, 2002, for $60 million.
  • 5A new, larger credit facility of $225 million was secured on May 13, 2002, to support future growth and operations.
  • 6The Motion Control segment saw strong sales growth (41%), driven by acquisitions and increased defense sales.
  • 7The Metal Treatment segment experienced a sales decline of 9% due to market softness and unfavorable currency movements.

Frequently Asked Questions

The primary driver of the 22% revenue increase to $97.8 million was the acquisitions completed in 2001, particularly in the fourth quarter. Organic sales growth, excluding these acquisitions, was a more modest 2%.

The acquisitions significantly boosted revenue and operating income, especially in the Motion Control and Flow Control segments. The company is in the process of integrating these businesses, with full purchase price allocation for goodwill and intangibles expected to be finalized in the second quarter of 2002. New accounting standards (SFAS 142) will impact how goodwill is treated going forward, moving from amortization to impairment testing.

The company maintains a strong liquidity position with a current ratio of 3.5 to 1, indicating healthy coverage of short-term liabilities by current assets. Cash, cash equivalents, and short-term investments totaled $49.4 million. The company also secured new, larger credit agreements totaling $225 million on May 13, 2002, enhancing its financial flexibility for future operations and acquisitions.

Yes, two major events occurred shortly after the quarter end: the acquisition of Penny and Giles and Autronics on April 1, 2002, for $60 million, strengthening its position in aerospace and defense, and the establishment of new credit facilities totaling $225 million on May 13, 2002, providing significant financial resources.