10-QPeriod: Q2 FY2003

CURTISS WRIGHT CORP Quarterly Report for Q2 Ended Jun 30, 2003

Filed August 13, 2003For Securities:CW

Summary

Curtiss-Wright Corporation (CW) reported a strong performance for the six months ended June 30, 2003, with a significant 65% increase in sales to $362.8 million, primarily driven by strategic acquisitions and robust organic growth in its Flow Control and Metal Treatment segments. Net earnings also saw a healthy 24% increase to $25.0 million, or $2.40 per diluted share, demonstrating effective integration of acquired businesses and strong operational execution. The company's backlog reached a record high of $511.5 million at the end of the second quarter, with approximately 70% originating from military contracts, indicating a solid pipeline of future business. While the Motion Control segment experienced some headwinds due to lower commercial aerospace demand and overhaul/repair services, it was partially offset by strong defense-related sales and the acquisition of Collins Technologies. The company maintains a healthy liquidity position with adequate working capital and credit facilities to support ongoing operations and future growth initiatives.

Key Highlights

  • 1Total sales for the six months ended June 30, 2003, increased by 65% to $362.8 million, largely due to acquisitions and organic growth in key segments.
  • 2Net earnings for the six months rose by 24% to $25.0 million, resulting in diluted earnings per share of $2.40.
  • 3The company's backlog reached a record $511.5 million as of June 30, 2003, with a significant portion (70%) from military contracts.
  • 4Acquisitions in the Motion Control (Collins Technologies) and Metal Treatment (E/M Engineered Coatings Solutions, Advanced Material Process) segments contributed significantly to revenue growth.
  • 5The Flow Control segment showed strong performance, with a 176% increase in six-month sales driven by defense, power generation, and international markets.
  • 6Despite some segment-specific challenges, overall liquidity remained strong, supported by $48.2 million in cash and cash equivalents and substantial credit facilities.
  • 7The company completed multiple acquisitions during the period, reflecting a strategy focused on expanding its capabilities and market reach.

Frequently Asked Questions

The primary driver of the 65% sales increase to $362.8 million in the first half of 2003 was the contribution from strategic acquisitions completed in late 2002 and early 2003, alongside solid organic growth in the Flow Control and Metal Treatment segments.

The company's backlog reached a record $511.5 million at June 30, 2003, representing a strong pipeline for future revenue. Approximately 70% of this backlog is derived from military business, indicating a significant focus and demand from the defense sector.

The Motion Control segment experienced reduced sales in commercial aerospace OEM and overhaul/repair services due to market conditions. However, this was partially offset by strong domestic ground defense sales and the acquisition of Collins Technologies, which contributed to overall segment revenue.

Curtiss-Wright maintains a strong liquidity position, with $48.2 million in cash and cash equivalents as of June 30, 2003. The company also has access to significant credit facilities totaling $225.0 million, which are sufficient to cover anticipated debt repayments, capital expenditures, dividends, and working capital requirements.