BWX Technologies (BWXT) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue rose 14% year-over-year to $672 million, driven by strong organic growth in Government Operations and stable Commercial Operations.

• Adjusted EBITDA increased 19% to $127 million, and adjusted/non-GAAP EPS grew 24% to $0.83, reflecting margin expansion and lower corporate expenses.

• Net income for Q3 2024 was $69.5 million, up from $60.3 million in Q3 2023; diluted GAAP EPS was $0.76.

• Announced acquisition of AOT/A.O.T./Aerojet Ordinance Tennessee for approximately $98–$100 million, expected to close by year-end, expanding the special materials portfolio and defense sector capabilities.

• Key contract wins include a pilot plant for domestic uranium enrichment, selection for HALEU deconversion services, and the Hanford Integrated Tank Disposition Contract.

Financial highlights

• Q3 2024 revenue: $672 million, up from $590 million in Q3 2023; nine-month revenue increased 10.5% to $1.96 billion.

• Adjusted EBITDA was $127 million (18.9% margin), up 19% year-over-year; operating income for Q3 was $96.6 million.

• Adjusted/non-GAAP EPS was $0.83, up from $0.67 in Q3 2023; net income was $69.5 million.

• Free cash flow for Q3 was negative at $7.7–$8 million, impacted by contract timing and higher capex; full-year guidance reaffirmed at $225–$250 million.

• Capital expenditures for Q3 2024 were $40–$40.3 million; year-to-date capex reached $101 million.

Outlook and guidance

• 2024 adjusted/non-GAAP EPS guidance raised to about $3.20; consolidated revenue guidance increased to approximately $2.7 billion.

• Free cash flow guidance reaffirmed at $225–$250 million; adjusted EBITDA guidance at ~$500 million.

• 2025 outlook projects mid- to high-single-digit growth in revenue, adjusted EBITDA, and EPS, with at least 10% free cash flow growth.

• Government Operations expected to see mid-single-digit growth; Commercial Operations to grow high-single to low-double digits in 2024, with double-digit growth in power and medical segments in 2025.

• 48% of backlog revenue expected to be recognized by end of 2025.