10-QPeriod: Q1 FY2004

CURTISS WRIGHT CORP Quarterly Report for Q1 Ended Mar 31, 2004

Filed May 10, 2004For Securities:CW

Summary

Curtiss-Wright Corporation reported a strong first quarter for 2004, with net sales increasing by 19% to $214.9 million compared to the prior year. This growth was driven by significant contributions from recent acquisitions, particularly in the Motion Control segment, which accounted for a substantial portion of incremental sales and orders. Organic growth also remained positive, especially in the Metal Treatment and Motion Control segments. Net earnings rose by 11% to $15.6 million, or $0.74 per diluted share. While the Flow Control segment experienced a sales decrease due to the completion of large projects in the prior year, the company's overall performance was bolstered by strong operating income growth in the Motion Control and Metal Treatment segments. The company also maintained healthy financial discipline, with a solid backlog and adequate liquidity to fund ongoing operations and strategic initiatives. The company appears to be successfully integrating its acquisitions and continuing to expand its market presence.

Key Highlights

  • 1Net sales increased by 19% year-over-year to $214.9 million, driven by acquisitions and organic growth.
  • 2Net earnings grew by 11% to $15.6 million, with diluted EPS at $0.74.
  • 3The Motion Control segment saw significant sales growth (46%) due to recent acquisitions, while Metal Treatment sales increased by 43%.
  • 4Flow Control segment sales decreased by 4% due to the completion of two large projects in the prior year, but its remaining businesses grew organically.
  • 5Acquisitions in 2003 and early 2004 contributed $29.6 million in incremental sales in Q1 2004.
  • 6Backlog increased by 10% to $558.0 million, with approximately 70% from military business.
  • 7Cash and cash equivalents decreased from $98.7 million to $33.3 million, largely due to the funding of the Dy 4 acquisition.

Frequently Asked Questions

The primary drivers of the sales increase were contributions from recent acquisitions, particularly in the Motion Control and Metal Treatment segments, which added $29.6 million in incremental sales. Organic growth of 4% was also a contributing factor, led by the Metal Treatment (17% organic growth) and Motion Control (10% organic growth) segments.

The acquisitions, including Dy 4 Systems Inc. and Evesham, significantly boosted sales and operating income. They contributed $29.6 million in incremental sales and $2.3 million in incremental operating income in the first quarter of 2004. The company is actively integrating these businesses and they are contributing positively to revenue and backlog.

The company's backlog increased by 10% to $558.0 million at March 31, 2004. Approximately 70% of this backlog is from military business, indicating a strong position in the defense sector.

The Flow Control segment's sales decreased by 4% primarily due to the completion of two large, high-margin projects in the first quarter of 2003 that did not recur in the same period of 2004. These projects accounted for approximately $14 million in sales in the prior year. However, the segment's remaining businesses showed a 12% increase in sales organically.