Astronics (ATRO) Sidoti Small-Cap Virtual Investor Conference summary

Leadership and Strategic Overview

• CFO Dave Burney is retiring, with Nancy Hedges set to succeed him in January.

• Focus on innovation and collaboration to serve aerospace, defense, and mission-critical industries with advanced technology solutions.

• Holds leading market share in in-seat power (90%+) and cabin electronics, powering over 1 million seats on 280+ airlines.

• Balanced exposure across commercial aerospace, defense, and government markets, with products on a wide range of aircraft platforms.

• Aerospace is the dominant segment, accounting for about 88-90% of business; test systems make up the rest.

Business Segments and Product Innovation

• In-flight entertainment and connectivity (IFEC) is nearly half of business, with about 90% market share in in-seat power.

• Lighting represents 20-25% of business, with products in commercial, business, and military aircraft.

• Advanced electrical power distribution systems selected for the U.S. Army FLRAA program, with first flight expected in 2026 and initial fielding in 2030.

• Test systems business awarded major contracts, including $215 million for U.S. Army radio test sets and $40 million for U.S. Marine Corps handheld radio test sets.

• Ongoing restructuring in 2024 expected to yield over $5 million in annualized savings.

Financial Performance and Outlook

• Trailing twelve months (TTM) Q3 2024 sales reached $782 million, with 88% from aerospace and 12% from test systems.

• Q3 2024 adjusted EBITDA margin expanded to 13.3%, up from 5.4% in Q3 2023.

• Free cash flow conversion of approximately 90%+ year-to-date 2024.

• Backlog at Q3 2024 stands at $612 million, mostly deliverable within 12 months.

• 2024 guidance implies year-over-year growth of over 14%, driven by commercial aerospace recovery and new contract wins.