Summary
Curtiss-Wright Corporation (CW) reported its third-quarter and nine-month results for the period ending September 30, 2020. Overall, the company experienced a decrease in net sales and earnings compared to the same periods in 2019. This decline was primarily driven by reduced sales in the Commercial/Industrial and Power segments, impacted by softer demand in commercial aerospace, general industrial, and power generation markets. These factors were partially offset by growth in the Defense segment, benefiting from increased demand in naval and aerospace defense. The company also incurred significant restructuring charges in 2020 as it implemented activities to improve operating efficiency. Despite the top-line pressures, Curtiss-Wright's financial position remained stable, with a strong cash balance and available credit facilities. The company also continued its focus on returning capital to shareholders through share repurchases and dividend payments, and importantly, it has completed a significant debt issuance to enhance its financial flexibility.
Financial Highlights
56 data points| Revenue | $571.61M |
| Cost of Revenue | $358.79M |
| Gross Profit | $212.82M |
| R&D Expenses | $17.59M |
| Operating Income | $84.57M |
| Interest Expense | $9.05M |
| Net Income | $64.62M |
| EPS (Basic) | $1.56 |
| EPS (Diluted) | $1.55 |
| Shares Outstanding (Basic) | 41.55M |
| Shares Outstanding (Diluted) | 41.80M |
Key Highlights
- 1Total net sales decreased by 7% for the third quarter and 6% for the nine months ended September 30, 2020, compared to the prior year periods.
- 2Net earnings saw a significant decline, down 22% for the third quarter and 32% for the nine months, reflecting lower sales and increased restructuring charges.
- 3The Defense segment showed resilience with sales increasing by 12% for the quarter and 14% for the nine months, driven by strong performance in naval and aerospace defense markets.
- 4The Commercial/Industrial segment experienced a substantial sales decline of 20% for the quarter and 17% for the nine months, heavily impacted by the commercial aerospace and general industrial markets.
- 5Restructuring expenses of $11 million for the quarter and $29 million for the nine months were incurred in 2020 to drive operational efficiency, with anticipated annual cost savings of $40 million.
- 6The company issued $300 million in Senior Notes in August 2020, increasing its long-term debt but enhancing its financial flexibility and liquidity.
- 7Share repurchases were substantial, with $137 million used for buybacks in the first nine months of 2020, alongside an announcement of an additional $200 million authorization for future repurchases.