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 non-GAAP EPS rose 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 ~$98–$100 million, expected to close by year-end, expanding the special materials portfolio and expected to be accretive to EPS.

• Key contract wins include a pilot plant for domestic uranium enrichment and selection for HALEU deconversion services.

Financial highlights

• Q3 2024 revenue: $672 million, up from $590 million in Q3 2023; adjusted EBITDA: $127 million (18.9% margin); non-GAAP EPS: $0.83.

• Net income for Q3 2024 was $69.5 million; operating income was $96.6 million, up from $85.4 million in Q3 2023.

• Free cash flow for Q3 2024 was negative at $(7.7)–$(8) million, impacted by contract timing and higher working capital needs.

• Dividend of $0.24 per share paid in Q3 2024.

• Working capital increased to $545.5 million as of September 30, 2024.

Outlook and guidance

• 2024 non-GAAP/adjusted EPS guidance raised to ~$3.20; free cash flow guidance maintained at $225–$250 million.

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

• Consolidated revenue guidance for 2024 raised to ~$2.7 billion.

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

• Sufficient liquidity and borrowing capacity to meet cash requirements for the next 12 months and beyond.