- Moog Inc. Announces Fourth Quarter and Year End 2022 Earnings Webcast on November 4, 2022
Oct 27, 2022 · businesswire.com
EAST AURORA, N.Y.--(BUSINESS WIRE)--Moog Inc. (NYSE: MOG.A and MOG.B) will release its fourth quarter and year-end earnings for the period ended October 1, 2022 on Friday, November 4, 2022. In conjunction with this release, Moog will host a conference call beginning at 10:00 a.m. ET, which will be simultaneously broadcast live over the Internet. John Scannell, Chairman and CEO, and Jennifer Walter, CFO, will host the call. Listeners can access the conference call live or in replay mode on the Internet at http://www.moog.com/investors/communications/. Please allow 15 minutes prior to the call to visit the site to download and install any necessary audio software. Supplemental data will be available on the website approximately 90 minutes prior to the call and will be archived for 45 days. Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, wind energy, marine and medical equipment. Additional information about the Company can be found at www.moog.com.
- MOOG INC. ANNOUNCES FOURTH QUARTER AND YEAR END 2022 EARNINGS WEBCAST ON NOVEMBER 4, 2022
Oct 27, 2022
EAST AURORA, N.Y.--(BUSINESS WIRE)--MOOG INC. (NYSE: MOG.A AND MOG.B) WILL RELEASE ITS FOURTH QUARTER AND YEAR-END EARNINGS FOR THE PERIOD ENDED OCTOBER 1, 2022 ON FRIDAY, NOVEMBER 4, 2022. IN CONJUNCTION WITH THIS RELEASE, MOOG WILL HOST A CONFERENCE CALL BEGINNING AT 10:00 A.M. ET, WHICH WILL BE SIMULTANEOUSLY BROADCAST LIVE OVER THE INTERNET. JOHN SCANNELL, CHAIRMAN AND CEO, AND JENNIFER WALTER, CFO, WILL HOST THE CALL. LISTENERS CAN ACCESS THE CONFERENCE CALL LIVE OR IN REPLAY MODE ON THE INTERNET AT HTTP://WWW.MOOG.COM/INVESTORS/COMMUNICATIONS/. PLEASE ALLOW 15 MINUTES PRIOR TO THE CALL TO VISIT THE SITE TO DOWNLOAD AND INSTALL ANY NECESSARY AUDIO SOFTWARE. SUPPLEMENTAL DATA WILL BE AVAILABLE ON THE WEBSITE APPROXIMATELY 90 MINUTES PRIOR TO THE CALL AND WILL BE ARCHIVED FOR 45 DAYS. MOOG INC. IS A WORLDWIDE DESIGNER, MANUFACTURER, AND INTEGRATOR OF PRECISION CONTROL COMPONENTS AND SYSTEMS. MOOG’S HIGH-PERFORMANCE SYSTEMS CONTROL MILITARY AND COMMERCIAL AIRCRAFT, SATELLITES AND SPACE VEHICLES, LAUNCH VEHICLES, MISSILES, AUTOMATED INDUSTRIAL MACHINERY, WIND ENERGY, MARINE AND MEDICAL EQUIPMENT. ADDITIONAL INFORMATION ABOUT THE COMPANY CAN BE FOUND AT WWW.MOOG.COM.
- Moog Inc. Announces Third Quarter Fiscal Year 2022 Earnings Webcast on July 29, 2022
Jul 21, 2022 · businesswire.com
EAST AURORA, N.Y.--(BUSINESS WIRE)--Moog Inc. (NYSE: MOG.A and MOG.B) will release its third quarter fiscal 2022 earnings for the period ended July 2, 2022 on Friday, July 29, 2022. In conjunction with this release, Moog will host a conference call beginning at 10:00 a.m. ET, which will be simultaneously broadcast live over the Internet. John Scannell, Chairman and CEO, and Jennifer Walter, CFO, will host the call. Listeners can access the conference call live or in replay mode on the Internet at http://www.moog.com/investors/communications/. Please allow 15 minutes prior to the call to visit the site to download and install any necessary audio software. Supplemental data will be available on the website approximately 90 minutes prior to the call and will be archived for 45 days. Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, wind energy, marine and medical equipment. Additional information about the company can be found at www.moog.com.
- MOOG INC. ANNOUNCES THIRD QUARTER FISCAL YEAR 2022 EARNINGS WEBCAST ON JULY 29, 2022
Jul 21, 2022
EAST AURORA, N.Y.--(BUSINESS WIRE)--MOOG INC. (NYSE: MOG.A AND MOG.B) WILL RELEASE ITS THIRD QUARTER FISCAL 2022 EARNINGS FOR THE PERIOD ENDED JULY 2, 2022 ON FRIDAY, JULY 29, 2022. IN CONJUNCTION WITH THIS RELEASE, MOOG WILL HOST A CONFERENCE CALL BEGINNING AT 10:00 A.M. ET, WHICH WILL BE SIMULTANEOUSLY BROADCAST LIVE OVER THE INTERNET. JOHN SCANNELL, CHAIRMAN AND CEO, AND JENNIFER WALTER, CFO, WILL HOST THE CALL. LISTENERS CAN ACCESS THE CONFERENCE CALL LIVE OR IN REPLAY MODE ON THE INTERNET AT HTTP://WWW.MOOG.COM/INVESTORS/COMMUNICATIONS/. PLEASE ALLOW 15 MINUTES PRIOR TO THE CALL TO VISIT THE SITE TO DOWNLOAD AND INSTALL ANY NECESSARY AUDIO SOFTWARE. SUPPLEMENTAL DATA WILL BE AVAILABLE ON THE WEBSITE APPROXIMATELY 90 MINUTES PRIOR TO THE CALL AND WILL BE ARCHIVED FOR 45 DAYS. MOOG INC. IS A WORLDWIDE DESIGNER, MANUFACTURER, AND INTEGRATOR OF PRECISION CONTROL COMPONENTS AND SYSTEMS. MOOG’S HIGH-PERFORMANCE SYSTEMS CONTROL MILITARY AND COMMERCIAL AIRCRAFT, SATELLITES AND SPACE VEHICLES, LAUNCH VEHICLES, MISSILES, AUTOMATED INDUSTRIAL MACHINERY, WIND ENERGY, MARINE AND MEDICAL EQUIPMENT. ADDITIONAL INFORMATION ABOUT THE COMPANY CAN BE FOUND AT WWW.MOOG.COM.
- Moog Inc. Reports Second Quarter Results
Apr 29, 2022 · businesswire.com
EAST AURORA, N.Y.--(BUSINESS WIRE)--Moog Inc. (NYSE: MOG.A and MOG.B) announced today financial results for the quarter ended April 2, 2022. Second Quarter Highlights Sales of $771 million were up 5% from a year ago; GAAP diluted earnings per share of $0.91 included $0.59 per share in restructuring and impairment charges; Non-GAAP diluted adjusted earnings per share of $1.49, up 12% from adjusted earnings per share a year ago; GAAP operating margins of 7.4% with adjusted operating margins of 10.6%; $23 million GAAP cash flow from operating activities and $13 million adjusted cash flow from operating activities; GAAP effective tax rate of 24.9% and adjusted effective tax rate of 24.4%. Segment Results Aircraft Controls segment revenues in the quarter were $311 million, 2% higher year over year. Commercial aircraft revenues were $119 million, a 16% increase. Sales to commercial OEM customers were unchanged with an increase in A350, 737, and business jet sales compensating for slower sales of 787 and other OEM products. Commercial aftermarket sales increased 61% on very strong repair and overhaul activity, particularly on the 787 aircraft, and one-time sales of test equipment that were booked in the quarter. Military aircraft sales were $192 million, down 5% year over year. Military OEM sales were down 11%, to $137 million. Lower F-35 Joint Strike Fighter sales and foreign military sales were partially offset by increased V-22 sales. Military aftermarket sales were 14% higher on increases across multiple programs. Space and Defense segment revenues were $223 million, an increase of 8% year over year. Defense sales of $136 million increased 15%. Strong sales of the RIwP® turret and various components continued and offset lower sales for tactical missile applications. Space sales were mostly unchanged, at $87 million, the result of reduced hypersonic development activity and lower sales of heritage space components, offset by growth in sales of new space vehicles. Industrial Systems segment sales in the quarter were $236 million, up 10% from a year ago, excluding the impact of foreign exchange movements and portfolio shaping activities. Sales of simulation and test products were 50% higher, as flight simulation activity for pilot training increased. Energy sales were up 14%, tied to the strength in oil prices and associated onshore and offshore exploration activity. Sales of products for industrial automation applications were down marginally, as the company completed minor portfolio shaping activities. Medical product sales were down 4%, the result of slower sales of components used in ventilators. In the second quarter, the Company incurred $25 million of restructuring and impairment charges. Delayed recovery in the commercial aircraft OEM business resulted in $19 million of charges within the Aircraft Controls segment. The Company also recorded $4 million related to further portfolio refinements in the Space and Defense Controls and Industrial Systems segments and $2 million of asset write-downs related to exiting activities in Russia as a result of the invasion of Ukraine. Consolidated 12-month backlog was $2.3 billion, up 17% from a year ago. “We’re pleased with our results this quarter which came in ahead of forecast,” said John Scannell, Chairman and CEO. “Our backlog continues to grow, and our longer-term outlook remains positive. We’re managing through the on-going challenges associated with COVID and supply chain disruptions and are confident in meeting our forecast for the remainder of the year.” Fiscal 2022 Outlook The Company updated its fiscal 2022 projections and adjusted figures provided 90 days ago. Forecasted sales of $3.0 billion; Forecasted GAAP diluted earnings per share of $5.24, and adjusted diluted earnings per share of $5.50, both plus or minus $0.20; Forecasted GAAP operating margins of 10.0% and adjusted operating margins of 10.3%; Forecasted cash flow from operating activities of $328 million and adjusted cash flow from operating activities of $228 million; and Forecasted GAAP effective tax rate of 25.0% and adjusted effective tax rate of 25.4%. In conjunction with today’s release, Moog will host a conference call today beginning at 10:00 a.m. ET, which will be broadcast live over the Internet. John Scannell, Chairman and CEO, and Jennifer Walter, CFO, will host the call. Listeners can access the call live or in replay mode at www.moog.com/investors/communications. Supplemental financial data will be available on the webcast web page 90 minutes prior to the conference call. About Moog Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, marine and medical equipment. Additional information about the company can be found at www.moog.com. CAUTIONARY STATEMENT Information included or incorporated by reference in this report that does not consist of historical facts, including statements accompanied by or containing words such as “may,” “will,” “should,” “believes,” “expects,” “expected,” “intends,” “plans,” “projects,” “approximate,” “estimates,” “predicts,” “potential,” “outlook,” “forecast,” “anticipates,” “presume” and “assume,” are forward-looking statements. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements. In evaluating these forward-looking statements, you should carefully consider the factors set forth below. Although it is not possible to create a comprehensive list of all factors that may cause actual results to differ from the results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors and other risks and uncertainties that arise from time to time are described in Item 1A “Risk Factors” of our Annual Report on Form 10-K and in our other periodic filings with the SEC and include the following: COVID-19 PANDEMIC RISKS We face various risks related to health pandemics such as the global COVID-19 pandemic, which may have material adverse consequences on our operations, financial position, cash flows, and those of our customers and suppliers. STRATEGIC RISKS We operate in highly competitive markets with competitors who may have greater resources than we possess; Our new products and technology research and development efforts are substantial and may not be successful which could reduce our sales and earnings; Our inability to adequately enforce and protect our intellectual property or defend against assertions of infringement could prevent or restrict our ability to compete; and Our sales and earnings may be affected if we cannot identify, acquire or integrate strategic acquisitions, or as we conduct divestitures. MARKET CONDITION RISKS The markets we serve are cyclical and sensitive to domestic and foreign economic conditions and events, which may cause our operating results to fluctuate; We depend heavily on government contracts that may not be fully funded or may be terminated, and the failure to receive funding or the termination of one or more of these contracts could reduce our sales and increase our costs; The loss of The Boeing Company or Lockheed Martin as a customer or a significant reduction in sales to either company could adversely impact our operating results; and We may not realize the full amounts reflected in our backlog as revenue, which could adversely affect our future revenue and growth prospects. OPERATIONAL RISKS Our business operations may be adversely affected by information systems interruptions, intrusions or new software implementations; We may not be able to prevent, or timely detect, issues with our products and our manufacturing processes which may adversely affect our operations and our earnings; If our subcontractors or suppliers fail to perform their contractual obligations, our prime contract performance and our ability to obtain future business could be materially and adversely impacted; and The failure or misuse of our products may damage our reputation, necessitate a product recall or result in claims against us that exceed our insurance coverage, thereby requiring us to pay significant damages. FINANCIAL RISKS We make estimates in accounting for over-time contracts, and changes in these estimates may have significant impacts on our earnings; We enter into fixed-price contracts, which could subject us to losses if we have cost overruns; Our indebtedness and restrictive covenants under our credit facilities could limit our operational and financial flexibility; The phase out of LIBOR may negatively impact our debt agreements and financial position, results of operations and liquidity; Significant changes in discount rates, rates of return on pension assets, mortality tables and other factors could adversely affect our earnings and equity and increase our pension funding requirements; A write-off of all or part of our goodwill or other intangible assets could adversely affect our operating results and net worth; and Unforeseen exposure to additional income tax liabilities may affect our operating results. LEGAL AND COMPLIANCE RISKS Contracting on government programs is subject to significant regulation, including rules related to bidding, billing and accounting standards, and any false claims or non-compliance could subject us to fines, penalties or possible debarment; Our operations in foreign countries expose us to currency, political and trade risks and adverse changes in local legal and regulatory environments could impact our results of operations; Government regulations could limit our ability to sell our products outside the United States and otherwise adversely affect our business; We are involved in various legal proceedings, the outcome of which may be unfavorable to us; and Our operations are subject to environmental laws, and complying with those laws may cause us to incur significant costs. GENERAL RISKS Future terror attacks, war, natural disasters or other catastrophic events beyond our control could negatively impact our business; and Our performance could suffer if we cannot maintain our culture as well as attract, retain and engage our employees. While we believe we have identified and discussed above the material risks affecting our business, there may be additional factors, risks and uncertainties not currently known to us or that we currently consider immaterial that may affect the forward-looking statements made herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. Any forward-looking statement speaks only as of the date on which it is made, and we disclaim any obligation to update any forward-looking statement made in this report, except as required by law. Moog Inc. CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) (dollars in thousands, except per share data) Three Months Ended Six Months Ended April 2, 2022 April 3, 2021 April 2, 2022 April 3, 2021 Net sales $ 770,787 $ 736,402 $ 1,494,873 $ 1,420,356 Cost of sales 556,070 536,493 1,085,776 1,030,804 Inventory write-down 1,705 — 3,205 — Gross profit 213,012 199,909 405,892 389,552 Research and development 30,720 30,453 58,428 58,461 Selling, general and administrative 111,019 105,131 222,816 204,734 Interest 8,263 8,629 16,245 17,049 Gain on sale of business — — (16,146 ) — Asset impairment 15,236 — 15,236 — Restructuring 7,793 — 7,793 — Other 1,268 (6,432 ) 1,384 (3,191 ) Earnings before income taxes 38,713 62,128 100,136 112,499 Income taxes 9,626 13,440 24,784 25,969 Net earnings $ 29,087 $ 48,688 $ 75,352 $ 86,530 Net earnings per share Basic $ 0.91 $ 1.51 $ 2.35 $ 2.69 Diluted $ 0.91 $ 1.51 $ 2.34 $ 2.68 Average common shares outstanding Basic 31,984,674 32,146,247 32,021,036 32,110,365 Diluted 32,120,726 32,325,494 32,154,442 32,281,158 Results shown in the previous table include impacts associated with the gain on the sale of our Navigation Aids business, as well as inventory write-down charges, asset impairment and restructuring related to the impact of continued portfolio shaping activities and the Ukraine crisis. The table below adjusts the income taxes, net earnings and diluted net earnings per share to exclude these impacts. While management believes that these non-GAAP financial measures may be useful in evaluating the financial condition and results of operations of the Company, this information should be considered supplemental and is not a substitute for financial information prepared in accordance with GAAP. Reconciliation to non-GAAP adjusted income taxes, net earnings and diluted net earnings per share are as follows: Three Months Ended Six Months Ended April 2, 2022 April 3, 2021 April 2, 2022 April 3, 2021 As Reported: Earnings before income taxes $ 38,713 $ 62,128 $ 100,136 $ 112,499 Income taxes 9,626 13,440 24,784 25,969 Effective income tax rate 24.9 % 21.6 % 24.8 % 23.1 % Net earnings 29,087 48,688 75,352 86,530 Diluted net earnings per share $ 0.91 $ 1.51 $ 2.34 $ 2.68 Gain on Sale of Business: Earnings before income taxes $ — $ — $ (16,146 ) $ — Income taxes — — (4,273 ) — Net earnings — — (11,873 ) — Diluted net earnings per share $ — $ — $ (0.37 ) $ — Other Charges: Earnings before income taxes $ 24,734 $ — $ 26,234 $ — Income taxes 5,883 — 6,237 — Net earnings 18,851 — 19,997 — Diluted net earnings per share $ 0.59 $ — $ 0.62 $ — Pension Curtailment Gain: Earnings before income taxes $ — $ (5,830 ) $ — $ (5,830 ) Income taxes — — — — Net earnings — (5,830 ) — (5,830 ) Diluted net earnings per share $ — $ (0.18 ) $ — $ (0.18 ) As Adjusted: Earnings before income taxes $ 63,447 $ 56,298 $ 110,224 $ 106,669 Income taxes 15,509 13,440 26,748 25,969 Effective income tax rate 24.4 % 23.9 % 24.3 % 24.3 % Net earnings 47,938 42,858 83,476 80,700 Diluted net earnings per share $ 1.49 $ 1.33 $ 2.60 $ 2.50 The diluted net earnings per share associated with the adjustments have been calculated individually and in total using the quarterly average outstanding shares in the period in which the adjustments occurred. Accordingly, adjusted diluted net earnings per share may not reconcile when totaled due to rounding. Moog Inc. CONSOLIDATED SALES AND OPERATING PROFIT (UNAUDITED) (dollars in thousands) Three Months Ended Six Months Ended April 2, 2022 April 3, 2021 April 2, 2022 April 3, 2021 Net sales: Aircraft Controls $ 311,268 $ 304,361 $ 614,585 $ 591,135 Space and Defense Controls 223,349 206,168 431,205 394,330 Industrial Systems 236,170 225,873 449,083 434,891 Net sales $ 770,787 $ 736,402 $ 1,494,873 $ 1,420,356 Operating profit: Aircraft Controls $ 12,441 $ 22,018 $ 54,356 $ 49,940 4.0 % 7.2 % 8.8 % 8.4 % Space and Defense Controls 24,075 26,652 45,374 49,698 10.8 % 12.9 % 10.5 % 12.6 % Industrial Systems 20,723 23,813 37,914 43,711 8.8 % 10.5 % 8.4 % 10.1 % Total operating profit 57,239 72,483 137,644 143,349 7.4 % 9.8 % 9.2 % 10.1 % Deductions from operating profit: Interest expense 8,263 8,629 16,245 17,049 Equity-based compensation expense 1,920 2,127 4,578 4,629 Non-service pension expense (income) 1,472 (4,901 ) 2,957 (3,981 ) Corporate and other expenses, net 6,871 4,500 13,728 13,153 Earnings before income taxes $ 38,713 $ 62,128 $ 100,136 $ 112,499 Operating Profit and Margins - as adjusted are as follows: Three Months Ended Six Months Ended April 2, 2022 April 3, 2021 April 2, 2022 April 3, 2021 Aircraft Controls operating profit - as reported $ 12,441 $ 22,018 $ 54,356 $ 49,940 Gain on sale of business — — (16,146 ) — Restructuring 4,232 — 4,232 — Asset impairment 14,594 — 14,594 — Aircraft Controls operating profit - as adjusted $ 31,267 $ 22,018 $ 57,036 $ 49,940 10.0 % 7.2 % 9.3 % 8.4 % Space and Defense Controls operating profit - as reported $ 24,075 $ 26,652 $ 45,374 $ 49,698 Inventory write-down — — 1,500 — Restructuring 1,837 — 1,837 — Space and Defense Controls operating profit - as adjusted $ 25,912 $ 26,652 $ 48,711 $ 49,698 11.6 % 12.9 % 11.3 % 12.6 % Industrial Systems operating profit - as reported $ 20,723 $ 23,813 $ 37,914 $ 43,711 Inventory write-down 1,705 — 1,705 — Restructuring 1,724 — 1,724 — Asset impairment 642 — 642 — Industrial Systems operating profit - as adjusted $ 24,794 $ 23,813 $ 41,985 $ 43,711 10.5 % 10.5 % 9.3 % 10.1 % Total operating profit - as adjusted $ 81,973 $ 72,483 $ 147,732 $ 143,349 10.6 % 9.8 % 9.9 % 10.1 % Moog Inc. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (dollars in thousands) April 2, 2022 October 2, 2021 ASSETS Current assets Cash and cash equivalents $ 120,395 $ 99,599 Restricted cash 1,736 1,315 Receivables, net 931,297 945,929 Inventories, net 591,601 613,095 Prepaid expenses and other current assets 67,802 58,842 Total current assets 1,712,831 1,718,780 Property, plant and equipment, net 668,602 645,778 Operating lease right-of-use assets 61,659 60,355 Goodwill 842,203 851,605 Intangible assets, net 104,608 106,095 Deferred income taxes 16,022 17,769 Other assets 35,568 32,787 Total assets $ 3,441,493 $ 3,433,169 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Current installments of long-term debt $ 372 $ 80,365 Accounts payable 222,986 200,602 Accrued compensation 79,709 112,703 Contract advances 321,594 263,686 Accrued liabilities and other 217,780 212,005 Total current liabilities 842,441 869,361 Long-term debt, excluding current installments 832,391 823,355 Long-term pension and retirement obligations 157,962 162,728 Deferred income taxes 70,636 64,642 Other long-term liabilities 107,415 112,939 Total liabilities 2,010,845 2,033,025 Shareholders’ equity Common stock - Class A 43,804 43,803 Common stock - Class B 7,476 7,477 Additional paid-in capital 543,292 509,622 Retained earnings 2,296,849 2,237,848 Treasury shares (1,028,414 ) (1,007,506 ) Stock Employee Compensation Trust (94,548 ) (79,776 ) Supplemental Retirement Plan Trust (73,876 ) (63,764 ) Accumulated other comprehensive loss (263,935 ) (247,560 ) Total shareholders’ equity 1,430,648 1,400,144 Total liabilities and shareholders’ equity $ 3,441,493 $ 3,433,169 Moog Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (dollars in thousands) Six Months Ended April 2, 2022 April 3, 2021 CASH FLOWS FROM OPERATING ACTIVITIES Net earnings $ 75,352 $ 86,530 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 38,316 37,622 Amortization 6,735 6,436 Deferred income taxes 4,834 (1,187 ) Equity-based compensation expense 4,578 4,629 Gain on sale of business (16,146 ) — Asset impairment and Inventory write-down 18,441 — Other 2,692 (3,115 ) Changes in assets and liabilities providing (using) cash: Receivables (4,223 ) (47,697 ) Inventories 6,951 9,301 Accounts payable 24,388 (5,088 ) Contract advances 60,392 51,349 Accrued expenses (28,324 ) (1,799 ) Accrued income taxes 8,217 12,691 Net pension and post retirement liabilities 8,927 3,846 Other assets and liabilities (30,933 ) (16,151 ) Net cash provided by operating activities 180,197 137,367 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of businesses, net of cash acquired (11,837 ) (77,600 ) Purchase of property, plant and equipment (74,087 ) (58,019 ) Other investing transactions 37,776 1,895 Net cash used by investing activities (48,148 ) (133,724 ) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from revolving lines of credit 463,950 503,200 Payments on revolving lines of credit (455,476 ) (467,700 ) Proceeds from long-term debt — 39,800 Payments on long-term debt (80,181 ) (39,903 ) Payments on finance lease obligations (1,085 ) (1,042 ) Payment of dividends (16,351 ) (16,046 ) Proceeds from sale of treasury stock 8,701 4,230 Purchase of outstanding shares for treasury (26,481 ) (18,844 ) Proceeds from sale of stock held by SECT 7,574 274 Purchase of stock held by SECT (10,396 ) (2,559 ) Net cash (used) provided by financing activities (109,745 ) 1,410 Effect of exchange rate changes on cash (1,087 ) 887 Increase in cash, cash equivalents and restricted cash 21,217 5,940 Cash, cash equivalents and restricted cash at beginning of period 100,914 85,072 Cash, cash equivalents and restricted cash at end of period $ 122,131 $ 91,012
- MOOG INC. REPORTS SECOND QUARTER RESULTS
Apr 29, 2022
EAST AURORA, N.Y.--(BUSINESS WIRE)--MOOG INC. (NYSE: MOG.A AND MOG.B) ANNOUNCED TODAY FINANCIAL RESULTS FOR THE QUARTER ENDED APRIL 2, 2022. SECOND QUARTER HIGHLIGHTS SALES OF $771 MILLION WERE UP 5% FROM A YEAR AGO; GAAP DILUTED EARNINGS PER SHARE OF $0.91 INCLUDED $0.59 PER SHARE IN RESTRUCTURING AND IMPAIRMENT CHARGES; NON-GAAP DILUTED ADJUSTED EARNINGS PER SHARE OF $1.49, UP 12% FROM ADJUSTED EARNINGS PER SHARE A YEAR AGO; GAAP OPERATING MARGINS OF 7.4% WITH ADJUSTED OPERATING MARGINS OF 10.6%; $23 MILLION GAAP CASH FLOW FROM OPERATING ACTIVITIES AND $13 MILLION ADJUSTED CASH FLOW FROM OPERATING ACTIVITIES; GAAP EFFECTIVE TAX RATE OF 24.9% AND ADJUSTED EFFECTIVE TAX RATE OF 24.4%. SEGMENT RESULTS AIRCRAFT CONTROLS SEGMENT REVENUES IN THE QUARTER WERE $311 MILLION, 2% HIGHER YEAR OVER YEAR. COMMERCIAL AIRCRAFT REVENUES WERE $119 MILLION, A 16% INCREASE. SALES TO COMMERCIAL OEM CUSTOMERS WERE UNCHANGED WITH AN INCREASE IN A350, 737, AND BUSINESS JET SALES COMPENSATING FOR SLOWER SALES OF 787 AND OTHER OEM PRODUCTS. COMMERCIAL AFTERMARKET SALES INCREASED 61% ON VERY STRONG REPAIR AND OVERHAUL ACTIVITY, PARTICULARLY ON THE 787 AIRCRAFT, AND ONE-TIME SALES OF TEST EQUIPMENT THAT WERE BOOKED IN THE QUARTER. MILITARY AIRCRAFT SALES WERE $192 MILLION, DOWN 5% YEAR OVER YEAR. MILITARY OEM SALES WERE DOWN 11%, TO $137 MILLION. LOWER F-35 JOINT STRIKE FIGHTER SALES AND FOREIGN MILITARY SALES WERE PARTIALLY OFFSET BY INCREASED V-22 SALES. MILITARY AFTERMARKET SALES WERE 14% HIGHER ON INCREASES ACROSS MULTIPLE PROGRAMS. SPACE AND DEFENSE SEGMENT REVENUES WERE $223 MILLION, AN INCREASE OF 8% YEAR OVER YEAR. DEFENSE SALES OF $136 MILLION INCREASED 15%. STRONG SALES OF THE RIWP® TURRET AND VARIOUS COMPONENTS CONTINUED AND OFFSET LOWER SALES FOR TACTICAL MISSILE APPLICATIONS. SPACE SALES WERE MOSTLY UNCHANGED, AT $87 MILLION, THE RESULT OF REDUCED HYPERSONIC DEVELOPMENT ACTIVITY AND LOWER SALES OF HERITAGE SPACE COMPONENTS, OFFSET BY GROWTH IN SALES OF NEW SPACE VEHICLES. INDUSTRIAL SYSTEMS SEGMENT SALES IN THE QUARTER WERE $236 MILLION, UP 10% FROM A YEAR AGO, EXCLUDING THE IMPACT OF FOREIGN EXCHANGE MOVEMENTS AND PORTFOLIO SHAPING ACTIVITIES. SALES OF SIMULATION AND TEST PRODUCTS WERE 50% HIGHER, AS FLIGHT SIMULATION ACTIVITY FOR PILOT TRAINING INCREASED. ENERGY SALES WERE UP 14%, TIED TO THE STRENGTH IN OIL PRICES AND ASSOCIATED ONSHORE AND OFFSHORE EXPLORATION ACTIVITY. SALES OF PRODUCTS FOR INDUSTRIAL AUTOMATION APPLICATIONS WERE DOWN MARGINALLY, AS THE COMPANY COMPLETED MINOR PORTFOLIO SHAPING ACTIVITIES. MEDICAL PRODUCT SALES WERE DOWN 4%, THE RESULT OF SLOWER SALES OF COMPONENTS USED IN VENTILATORS. IN THE SECOND QUARTER, THE COMPANY INCURRED $25 MILLION OF RESTRUCTURING AND IMPAIRMENT CHARGES. DELAYED RECOVERY IN THE COMMERCIAL AIRCRAFT OEM BUSINESS RESULTED IN $19 MILLION OF CHARGES WITHIN THE AIRCRAFT CONTROLS SEGMENT. THE COMPANY ALSO RECORDED $4 MILLION RELATED TO FURTHER PORTFOLIO REFINEMENTS IN THE SPACE AND DEFENSE CONTROLS AND INDUSTRIAL SYSTEMS SEGMENTS AND $2 MILLION OF ASSET WRITE-DOWNS RELATED TO EXITING ACTIVITIES IN RUSSIA AS A RESULT OF THE INVASION OF UKRAINE. CONSOLIDATED 12-MONTH BACKLOG WAS $2.3 BILLION, UP 17% FROM A YEAR AGO. “WE’RE PLEASED WITH OUR RESULTS THIS QUARTER WHICH CAME IN AHEAD OF FORECAST,” SAID JOHN SCANNELL, CHAIRMAN AND CEO. “OUR BACKLOG CONTINUES TO GROW, AND OUR LONGER-TERM OUTLOOK REMAINS POSITIVE. WE’RE MANAGING THROUGH THE ON-GOING CHALLENGES ASSOCIATED WITH COVID AND SUPPLY CHAIN DISRUPTIONS AND ARE CONFIDENT IN MEETING OUR FORECAST FOR THE REMAINDER OF THE YEAR.” FISCAL 2022 OUTLOOK THE COMPANY UPDATED ITS FISCAL 2022 PROJECTIONS AND ADJUSTED FIGURES PROVIDED 90 DAYS AGO. FORECASTED SALES OF $3.0 BILLION; FORECASTED GAAP DILUTED EARNINGS PER SHARE OF $5.24, AND ADJUSTED DILUTED EARNINGS PER SHARE OF $5.50, BOTH PLUS OR MINUS $0.20; FORECASTED GAAP OPERATING MARGINS OF 10.0% AND ADJUSTED OPERATING MARGINS OF 10.3%; FORECASTED CASH FLOW FROM OPERATING ACTIVITIES OF $328 MILLION AND ADJUSTED CASH FLOW FROM OPERATING ACTIVITIES OF $228 MILLION; AND FORECASTED GAAP EFFECTIVE TAX RATE OF 25.0% AND ADJUSTED EFFECTIVE TAX RATE OF 25.4%. IN CONJUNCTION WITH TODAY’S RELEASE, MOOG WILL HOST A CONFERENCE CALL TODAY BEGINNING AT 10:00 A.M. ET, WHICH WILL BE BROADCAST LIVE OVER THE INTERNET. JOHN SCANNELL, CHAIRMAN AND CEO, AND JENNIFER WALTER, CFO, WILL HOST THE CALL. LISTENERS CAN ACCESS THE CALL LIVE OR IN REPLAY MODE AT WWW.MOOG.COM/INVESTORS/COMMUNICATIONS. SUPPLEMENTAL FINANCIAL DATA WILL BE AVAILABLE ON THE WEBCAST WEB PAGE 90 MINUTES PRIOR TO THE CONFERENCE CALL. ABOUT MOOG MOOG INC. IS A WORLDWIDE DESIGNER, MANUFACTURER, AND INTEGRATOR OF PRECISION CONTROL COMPONENTS AND SYSTEMS. MOOG’S HIGH-PERFORMANCE SYSTEMS CONTROL MILITARY AND COMMERCIAL AIRCRAFT, SATELLITES AND SPACE VEHICLES, LAUNCH VEHICLES, MISSILES, AUTOMATED INDUSTRIAL MACHINERY, MARINE AND MEDICAL EQUIPMENT. ADDITIONAL INFORMATION ABOUT THE COMPANY CAN BE FOUND AT WWW.MOOG.COM. CAUTIONARY STATEMENT INFORMATION INCLUDED OR INCORPORATED BY REFERENCE IN THIS REPORT THAT DOES NOT CONSIST OF HISTORICAL FACTS, INCLUDING STATEMENTS ACCOMPANIED BY OR CONTAINING WORDS SUCH AS “MAY,” “WILL,” “SHOULD,” “BELIEVES,” “EXPECTS,” “EXPECTED,” “INTENDS,” “PLANS,” “PROJECTS,” “APPROXIMATE,” “ESTIMATES,” “PREDICTS,” “POTENTIAL,” “OUTLOOK,” “FORECAST,” “ANTICIPATES,” “PRESUME” AND “ASSUME,” ARE FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THESE FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND ARE SUBJECT TO SEVERAL FACTORS, RISKS AND UNCERTAINTIES, THE IMPACT OR OCCURRENCE OF WHICH COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE EXPECTED RESULTS DESCRIBED IN THE FORWARD-LOOKING STATEMENTS. IN EVALUATING THESE FORWARD-LOOKING STATEMENTS, YOU SHOULD CAREFULLY CONSIDER THE FACTORS SET FORTH BELOW. ALTHOUGH IT IS NOT POSSIBLE TO CREATE A COMPREHENSIVE LIST OF ALL FACTORS THAT MAY CAUSE ACTUAL RESULTS TO DIFFER FROM THE RESULTS EXPRESSED OR IMPLIED BY OUR FORWARD-LOOKING STATEMENTS OR THAT MAY AFFECT OUR FUTURE RESULTS, SOME OF THESE FACTORS AND OTHER RISKS AND UNCERTAINTIES THAT ARISE FROM TIME TO TIME ARE DESCRIBED IN ITEM 1A “RISK FACTORS” OF OUR ANNUAL REPORT ON FORM 10-K AND IN OUR OTHER PERIODIC FILINGS WITH THE SEC AND INCLUDE THE FOLLOWING: COVID-19 PANDEMIC RISKS WE FACE VARIOUS RISKS RELATED TO HEALTH PANDEMICS SUCH AS THE GLOBAL COVID-19 PANDEMIC, WHICH MAY HAVE MATERIAL ADVERSE CONSEQUENCES ON OUR OPERATIONS, FINANCIAL POSITION, CASH FLOWS, AND THOSE OF OUR CUSTOMERS AND SUPPLIERS. STRATEGIC RISKS WE OPERATE IN HIGHLY COMPETITIVE MARKETS WITH COMPETITORS WHO MAY HAVE GREATER RESOURCES THAN WE POSSESS; OUR NEW PRODUCTS AND TECHNOLOGY RESEARCH AND DEVELOPMENT EFFORTS ARE SUBSTANTIAL AND MAY NOT BE SUCCESSFUL WHICH COULD REDUCE OUR SALES AND EARNINGS; OUR INABILITY TO ADEQUATELY ENFORCE AND PROTECT OUR INTELLECTUAL PROPERTY OR DEFEND AGAINST ASSERTIONS OF INFRINGEMENT COULD PREVENT OR RESTRICT OUR ABILITY TO COMPETE; AND OUR SALES AND EARNINGS MAY BE AFFECTED IF WE CANNOT IDENTIFY, ACQUIRE OR INTEGRATE STRATEGIC ACQUISITIONS, OR AS WE CONDUCT DIVESTITURES. MARKET CONDITION RISKS THE MARKETS WE SERVE ARE CYCLICAL AND SENSITIVE TO DOMESTIC AND FOREIGN ECONOMIC CONDITIONS AND EVENTS, WHICH MAY CAUSE OUR OPERATING RESULTS TO FLUCTUATE; WE DEPEND HEAVILY ON GOVERNMENT CONTRACTS THAT MAY NOT BE FULLY FUNDED OR MAY BE TERMINATED, AND THE FAILURE TO RECEIVE FUNDING OR THE TERMINATION OF ONE OR MORE OF THESE CONTRACTS COULD REDUCE OUR SALES AND INCREASE OUR COSTS; THE LOSS OF THE BOEING COMPANY OR LOCKHEED MARTIN AS A CUSTOMER OR A SIGNIFICANT REDUCTION IN SALES TO EITHER COMPANY COULD ADVERSELY IMPACT OUR OPERATING RESULTS; AND WE MAY NOT REALIZE THE FULL AMOUNTS REFLECTED IN OUR BACKLOG AS REVENUE, WHICH COULD ADVERSELY AFFECT OUR FUTURE REVENUE AND GROWTH PROSPECTS. OPERATIONAL RISKS OUR BUSINESS OPERATIONS MAY BE ADVERSELY AFFECTED BY INFORMATION SYSTEMS INTERRUPTIONS, INTRUSIONS OR NEW SOFTWARE IMPLEMENTATIONS; WE MAY NOT BE ABLE TO PREVENT, OR TIMELY DETECT, ISSUES WITH OUR PRODUCTS AND OUR MANUFACTURING PROCESSES WHICH MAY ADVERSELY AFFECT OUR OPERATIONS AND OUR EARNINGS; IF OUR SUBCONTRACTORS OR SUPPLIERS FAIL TO PERFORM THEIR CONTRACTUAL OBLIGATIONS, OUR PRIME CONTRACT PERFORMANCE AND OUR ABILITY TO OBTAIN FUTURE BUSINESS COULD BE MATERIALLY AND ADVERSELY IMPACTED; AND THE FAILURE OR MISUSE OF OUR PRODUCTS MAY DAMAGE OUR REPUTATION, NECESSITATE A PRODUCT RECALL OR RESULT IN CLAIMS AGAINST US THAT EXCEED OUR INSURANCE COVERAGE, THEREBY REQUIRING US TO PAY SIGNIFICANT DAMAGES. FINANCIAL RISKS WE MAKE ESTIMATES IN ACCOUNTING FOR OVER-TIME CONTRACTS, AND CHANGES IN THESE ESTIMATES MAY HAVE SIGNIFICANT IMPACTS ON OUR EARNINGS; WE ENTER INTO FIXED-PRICE CONTRACTS, WHICH COULD SUBJECT US TO LOSSES IF WE HAVE COST OVERRUNS; OUR INDEBTEDNESS AND RESTRICTIVE COVENANTS UNDER OUR CREDIT FACILITIES COULD LIMIT OUR OPERATIONAL AND FINANCIAL FLEXIBILITY; THE PHASE OUT OF LIBOR MAY NEGATIVELY IMPACT OUR DEBT AGREEMENTS AND FINANCIAL POSITION, RESULTS OF OPERATIONS AND LIQUIDITY; SIGNIFICANT CHANGES IN DISCOUNT RATES, RATES OF RETURN ON PENSION ASSETS, MORTALITY TABLES AND OTHER FACTORS COULD ADVERSELY AFFECT OUR EARNINGS AND EQUITY AND INCREASE OUR PENSION FUNDING REQUIREMENTS; A WRITE-OFF OF ALL OR PART OF OUR GOODWILL OR OTHER INTANGIBLE ASSETS COULD ADVERSELY AFFECT OUR OPERATING RESULTS AND NET WORTH; AND UNFORESEEN EXPOSURE TO ADDITIONAL INCOME TAX LIABILITIES MAY AFFECT OUR OPERATING RESULTS. LEGAL AND COMPLIANCE RISKS CONTRACTING ON GOVERNMENT PROGRAMS IS SUBJECT TO SIGNIFICANT REGULATION, INCLUDING RULES RELATED TO BIDDING, BILLING AND ACCOUNTING STANDARDS, AND ANY FALSE CLAIMS OR NON-COMPLIANCE COULD SUBJECT US TO FINES, PENALTIES OR POSSIBLE DEBARMENT; OUR OPERATIONS IN FOREIGN COUNTRIES EXPOSE US TO CURRENCY, POLITICAL AND TRADE RISKS AND ADVERSE CHANGES IN LOCAL LEGAL AND REGULATORY ENVIRONMENTS COULD IMPACT OUR RESULTS OF OPERATIONS; GOVERNMENT REGULATIONS COULD LIMIT OUR ABILITY TO SELL OUR PRODUCTS OUTSIDE THE UNITED STATES AND OTHERWISE ADVERSELY AFFECT OUR BUSINESS; WE ARE INVOLVED IN VARIOUS LEGAL PROCEEDINGS, THE OUTCOME OF WHICH MAY BE UNFAVORABLE TO US; AND OUR OPERATIONS ARE SUBJECT TO ENVIRONMENTAL LAWS, AND COMPLYING WITH THOSE LAWS MAY CAUSE US TO INCUR SIGNIFICANT COSTS. GENERAL RISKS FUTURE TERROR ATTACKS, WAR, NATURAL DISASTERS OR OTHER CATASTROPHIC EVENTS BEYOND OUR CONTROL COULD NEGATIVELY IMPACT OUR BUSINESS; AND OUR PERFORMANCE COULD SUFFER IF WE CANNOT MAINTAIN OUR CULTURE AS WELL AS ATTRACT, RETAIN AND ENGAGE OUR EMPLOYEES. WHILE WE BELIEVE WE HAVE IDENTIFIED AND DISCUSSED ABOVE THE MATERIAL RISKS AFFECTING OUR BUSINESS, THERE MAY BE ADDITIONAL FACTORS, RISKS AND UNCERTAINTIES NOT CURRENTLY KNOWN TO US OR THAT WE CURRENTLY CONSIDER IMMATERIAL THAT MAY AFFECT THE FORWARD-LOOKING STATEMENTS MADE HEREIN. GIVEN THESE FACTORS, RISKS AND UNCERTAINTIES, INVESTORS SHOULD NOT PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS AS PREDICTIVE OF FUTURE RESULTS. ANY FORWARD-LOOKING STATEMENT SPEAKS ONLY AS OF THE DATE ON WHICH IT IS MADE, AND WE DISCLAIM ANY OBLIGATION TO UPDATE ANY FORWARD-LOOKING STATEMENT MADE IN THIS REPORT, EXCEPT AS REQUIRED BY LAW. MOOG INC. CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) THREE MONTHS ENDED SIX MONTHS ENDED APRIL 2, 2022 APRIL 3, 2021 APRIL 2, 2022 APRIL 3, 2021 NET SALES $ 770,787 $ 736,402 $ 1,494,873 $ 1,420,356 COST OF SALES 556,070 536,493 1,085,776 1,030,804 INVENTORY WRITE-DOWN 1,705 — 3,205 — GROSS PROFIT 213,012 199,909 405,892 389,552 RESEARCH AND DEVELOPMENT 30,720 30,453 58,428 58,461 SELLING, GENERAL AND ADMINISTRATIVE 111,019 105,131 222,816 204,734 INTEREST 8,263 8,629 16,245 17,049 GAIN ON SALE OF BUSINESS — — (16,146 ) — ASSET IMPAIRMENT 15,236 — 15,236 — RESTRUCTURING 7,793 — 7,793 — OTHER 1,268 (6,432 ) 1,384 (3,191 ) EARNINGS BEFORE INCOME TAXES 38,713 62,128 100,136 112,499 INCOME TAXES 9,626 13,440 24,784 25,969 NET EARNINGS $ 29,087 $ 48,688 $ 75,352 $ 86,530 NET EARNINGS PER SHARE BASIC $ 0.91 $ 1.51 $ 2.35 $ 2.69 DILUTED $ 0.91 $ 1.51 $ 2.34 $ 2.68 AVERAGE COMMON SHARES OUTSTANDING BASIC 31,984,674 32,146,247 32,021,036 32,110,365 DILUTED 32,120,726 32,325,494 32,154,442 32,281,158 RESULTS SHOWN IN THE PREVIOUS TABLE INCLUDE IMPACTS ASSOCIATED WITH THE GAIN ON THE SALE OF OUR NAVIGATION AIDS BUSINESS, AS WELL AS INVENTORY WRITE-DOWN CHARGES, ASSET IMPAIRMENT AND RESTRUCTURING RELATED TO THE IMPACT OF CONTINUED PORTFOLIO SHAPING ACTIVITIES AND THE UKRAINE CRISIS. THE TABLE BELOW ADJUSTS THE INCOME TAXES, NET EARNINGS AND DILUTED NET EARNINGS PER SHARE TO EXCLUDE THESE IMPACTS. WHILE MANAGEMENT BELIEVES THAT THESE NON-GAAP FINANCIAL MEASURES MAY BE USEFUL IN EVALUATING THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF THE COMPANY, THIS INFORMATION SHOULD BE CONSIDERED SUPPLEMENTAL AND IS NOT A SUBSTITUTE FOR FINANCIAL INFORMATION PREPARED IN ACCORDANCE WITH GAAP. RECONCILIATION TO NON-GAAP ADJUSTED INCOME TAXES, NET EARNINGS AND DILUTED NET EARNINGS PER SHARE ARE AS FOLLOWS: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 2, 2022 APRIL 3, 2021 APRIL 2, 2022 APRIL 3, 2021 AS REPORTED: EARNINGS BEFORE INCOME TAXES $ 38,713 $ 62,128 $ 100,136 $ 112,499 INCOME TAXES 9,626 13,440 24,784 25,969 EFFECTIVE INCOME TAX RATE 24.9 % 21.6 % 24.8 % 23.1 % NET EARNINGS 29,087 48,688 75,352 86,530 DILUTED NET EARNINGS PER SHARE $ 0.91 $ 1.51 $ 2.34 $ 2.68 GAIN ON SALE OF BUSINESS: EARNINGS BEFORE INCOME TAXES $ — $ — $ (16,146 ) $ — INCOME TAXES — — (4,273 ) — NET EARNINGS — — (11,873 ) — DILUTED NET EARNINGS PER SHARE $ — $ — $ (0.37 ) $ — OTHER CHARGES: EARNINGS BEFORE INCOME TAXES $ 24,734 $ — $ 26,234 $ — INCOME TAXES 5,883 — 6,237 — NET EARNINGS 18,851 — 19,997 — DILUTED NET EARNINGS PER SHARE $ 0.59 $ — $ 0.62 $ — PENSION CURTAILMENT GAIN: EARNINGS BEFORE INCOME TAXES $ — $ (5,830 ) $ — $ (5,830 ) INCOME TAXES — — — — NET EARNINGS — (5,830 ) — (5,830 ) DILUTED NET EARNINGS PER SHARE $ — $ (0.18 ) $ — $ (0.18 ) AS ADJUSTED: EARNINGS BEFORE INCOME TAXES $ 63,447 $ 56,298 $ 110,224 $ 106,669 INCOME TAXES 15,509 13,440 26,748 25,969 EFFECTIVE INCOME TAX RATE 24.4 % 23.9 % 24.3 % 24.3 % NET EARNINGS 47,938 42,858 83,476 80,700 DILUTED NET EARNINGS PER SHARE $ 1.49 $ 1.33 $ 2.60 $ 2.50 THE DILUTED NET EARNINGS PER SHARE ASSOCIATED WITH THE ADJUSTMENTS HAVE BEEN CALCULATED INDIVIDUALLY AND IN TOTAL USING THE QUARTERLY AVERAGE OUTSTANDING SHARES IN THE PERIOD IN WHICH THE ADJUSTMENTS OCCURRED. ACCORDINGLY, ADJUSTED DILUTED NET EARNINGS PER SHARE MAY NOT RECONCILE WHEN TOTALED DUE TO ROUNDING. MOOG INC. CONSOLIDATED SALES AND OPERATING PROFIT (UNAUDITED) (DOLLARS IN THOUSANDS) THREE MONTHS ENDED SIX MONTHS ENDED APRIL 2, 2022 APRIL 3, 2021 APRIL 2, 2022 APRIL 3, 2021 NET SALES: AIRCRAFT CONTROLS $ 311,268 $ 304,361 $ 614,585 $ 591,135 SPACE AND DEFENSE CONTROLS 223,349 206,168 431,205 394,330 INDUSTRIAL SYSTEMS 236,170 225,873 449,083 434,891 NET SALES $ 770,787 $ 736,402 $ 1,494,873 $ 1,420,356 OPERATING PROFIT: AIRCRAFT CONTROLS $ 12,441 $ 22,018 $ 54,356 $ 49,940 4.0 % 7.2 % 8.8 % 8.4 % SPACE AND DEFENSE CONTROLS 24,075 26,652 45,374 49,698 10.8 % 12.9 % 10.5 % 12.6 % INDUSTRIAL SYSTEMS 20,723 23,813 37,914 43,711 8.8 % 10.5 % 8.4 % 10.1 % TOTAL OPERATING PROFIT 57,239 72,483 137,644 143,349 7.4 % 9.8 % 9.2 % 10.1 % DEDUCTIONS FROM OPERATING PROFIT: INTEREST EXPENSE 8,263 8,629 16,245 17,049 EQUITY-BASED COMPENSATION EXPENSE 1,920 2,127 4,578 4,629 NON-SERVICE PENSION EXPENSE (INCOME) 1,472 (4,901 ) 2,957 (3,981 ) CORPORATE AND OTHER EXPENSES, NET 6,871 4,500 13,728 13,153 EARNINGS BEFORE INCOME TAXES $ 38,713 $ 62,128 $ 100,136 $ 112,499 OPERATING PROFIT AND MARGINS - AS ADJUSTED ARE AS FOLLOWS: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 2, 2022 APRIL 3, 2021 APRIL 2, 2022 APRIL 3, 2021 AIRCRAFT CONTROLS OPERATING PROFIT - AS REPORTED $ 12,441 $ 22,018 $ 54,356 $ 49,940 GAIN ON SALE OF BUSINESS — — (16,146 ) — RESTRUCTURING 4,232 — 4,232 — ASSET IMPAIRMENT 14,594 — 14,594 — AIRCRAFT CONTROLS OPERATING PROFIT - AS ADJUSTED $ 31,267 $ 22,018 $ 57,036 $ 49,940 10.0 % 7.2 % 9.3 % 8.4 % SPACE AND DEFENSE CONTROLS OPERATING PROFIT - AS REPORTED $ 24,075 $ 26,652 $ 45,374 $ 49,698 INVENTORY WRITE-DOWN — — 1,500 — RESTRUCTURING 1,837 — 1,837 — SPACE AND DEFENSE CONTROLS OPERATING PROFIT - AS ADJUSTED $ 25,912 $ 26,652 $ 48,711 $ 49,698 11.6 % 12.9 % 11.3 % 12.6 % INDUSTRIAL SYSTEMS OPERATING PROFIT - AS REPORTED $ 20,723 $ 23,813 $ 37,914 $ 43,711 INVENTORY WRITE-DOWN 1,705 — 1,705 — RESTRUCTURING 1,724 — 1,724 — ASSET IMPAIRMENT 642 — 642 — INDUSTRIAL SYSTEMS OPERATING PROFIT - AS ADJUSTED $ 24,794 $ 23,813 $ 41,985 $ 43,711 10.5 % 10.5 % 9.3 % 10.1 % TOTAL OPERATING PROFIT - AS ADJUSTED $ 81,973 $ 72,483 $ 147,732 $ 143,349 10.6 % 9.8 % 9.9 % 10.1 % MOOG INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (DOLLARS IN THOUSANDS) APRIL 2, 2022 OCTOBER 2, 2021 ASSETS CURRENT ASSETS CASH AND CASH EQUIVALENTS $ 120,395 $ 99,599 RESTRICTED CASH 1,736 1,315 RECEIVABLES, NET 931,297 945,929 INVENTORIES, NET 591,601 613,095 PREPAID EXPENSES AND OTHER CURRENT ASSETS 67,802 58,842 TOTAL CURRENT ASSETS 1,712,831 1,718,780 PROPERTY, PLANT AND EQUIPMENT, NET 668,602 645,778 OPERATING LEASE RIGHT-OF-USE ASSETS 61,659 60,355 GOODWILL 842,203 851,605 INTANGIBLE ASSETS, NET 104,608 106,095 DEFERRED INCOME TAXES 16,022 17,769 OTHER ASSETS 35,568 32,787 TOTAL ASSETS $ 3,441,493 $ 3,433,169 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES CURRENT INSTALLMENTS OF LONG-TERM DEBT $ 372 $ 80,365 ACCOUNTS PAYABLE 222,986 200,602 ACCRUED COMPENSATION 79,709 112,703 CONTRACT ADVANCES 321,594 263,686 ACCRUED LIABILITIES AND OTHER 217,780 212,005 TOTAL CURRENT LIABILITIES 842,441 869,361 LONG-TERM DEBT, EXCLUDING CURRENT INSTALLMENTS 832,391 823,355 LONG-TERM PENSION AND RETIREMENT OBLIGATIONS 157,962 162,728 DEFERRED INCOME TAXES 70,636 64,642 OTHER LONG-TERM LIABILITIES 107,415 112,939 TOTAL LIABILITIES 2,010,845 2,033,025 SHAREHOLDERS’ EQUITY COMMON STOCK - CLASS A 43,804 43,803 COMMON STOCK - CLASS B 7,476 7,477 ADDITIONAL PAID-IN CAPITAL 543,292 509,622 RETAINED EARNINGS 2,296,849 2,237,848 TREASURY SHARES (1,028,414 ) (1,007,506 ) STOCK EMPLOYEE COMPENSATION TRUST (94,548 ) (79,776 ) SUPPLEMENTAL RETIREMENT PLAN TRUST (73,876 ) (63,764 ) ACCUMULATED OTHER COMPREHENSIVE LOSS (263,935 ) (247,560 ) TOTAL SHAREHOLDERS’ EQUITY 1,430,648 1,400,144 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 3,441,493 $ 3,433,169 MOOG INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (DOLLARS IN THOUSANDS) SIX MONTHS ENDED APRIL 2, 2022 APRIL 3, 2021 CASH FLOWS FROM OPERATING ACTIVITIES NET EARNINGS $ 75,352 $ 86,530 ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH PROVIDED BY OPERATING ACTIVITIES: DEPRECIATION 38,316 37,622 AMORTIZATION 6,735 6,436 DEFERRED INCOME TAXES 4,834 (1,187 ) EQUITY-BASED COMPENSATION EXPENSE 4,578 4,629 GAIN ON SALE OF BUSINESS (16,146 ) — ASSET IMPAIRMENT AND INVENTORY WRITE-DOWN 18,441 — OTHER 2,692 (3,115 ) CHANGES IN ASSETS AND LIABILITIES PROVIDING (USING) CASH: RECEIVABLES (4,223 ) (47,697 ) INVENTORIES 6,951 9,301 ACCOUNTS PAYABLE 24,388 (5,088 ) CONTRACT ADVANCES 60,392 51,349 ACCRUED EXPENSES (28,324 ) (1,799 ) ACCRUED INCOME TAXES 8,217 12,691 NET PENSION AND POST RETIREMENT LIABILITIES 8,927 3,846 OTHER ASSETS AND LIABILITIES (30,933 ) (16,151 ) NET CASH PROVIDED BY OPERATING ACTIVITIES 180,197 137,367 CASH FLOWS FROM INVESTING ACTIVITIES ACQUISITIONS OF BUSINESSES, NET OF CASH ACQUIRED (11,837 ) (77,600 ) PURCHASE OF PROPERTY, PLANT AND EQUIPMENT (74,087 ) (58,019 ) OTHER INVESTING TRANSACTIONS 37,776 1,895 NET CASH USED BY INVESTING ACTIVITIES (48,148 ) (133,724 ) CASH FLOWS FROM FINANCING ACTIVITIES PROCEEDS FROM REVOLVING LINES OF CREDIT 463,950 503,200 PAYMENTS ON REVOLVING LINES OF CREDIT (455,476 ) (467,700 ) PROCEEDS FROM LONG-TERM DEBT — 39,800 PAYMENTS ON LONG-TERM DEBT (80,181 ) (39,903 ) PAYMENTS ON FINANCE LEASE OBLIGATIONS (1,085 ) (1,042 ) PAYMENT OF DIVIDENDS (16,351 ) (16,046 ) PROCEEDS FROM SALE OF TREASURY STOCK 8,701 4,230 PURCHASE OF OUTSTANDING SHARES FOR TREASURY (26,481 ) (18,844 ) PROCEEDS FROM SALE OF STOCK HELD BY SECT 7,574 274 PURCHASE OF STOCK HELD BY SECT (10,396 ) (2,559 ) NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES (109,745 ) 1,410 EFFECT OF EXCHANGE RATE CHANGES ON CASH (1,087 ) 887 INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 21,217 5,940 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD 100,914 85,072 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD $ 122,131 $ 91,012
- Moog Inc. Reports Fiscal Year End 2021 Results and Initial Guidance for Fiscal Year 2022
Nov 5, 2021 · businesswire.com
EAST AURORA, N.Y.--(BUSINESS WIRE)--Moog Inc. (NYSE: MOG.A and MOG.B) announced today financial results for the quarter and fiscal year ended October 2, 2021. Fourth Quarter Highlights Sales of $724 million, up 2% from a year ago; GAAP diluted earnings per share of $1.07, up 32%, including $0.18 of one-time adjustments; Operating margins of 8.7%; Effective tax rate of 19.0%; and $63 million cash flow from operating activities. Full-Year 2021 Highlights Sales of $2.9 billion, down 1% from a year ago; GAAP diluted earnings per share of $4.87, including $0.18 of one-time adjustments, up 1% from adjusted results a year ago; Operating margins of 9.5%; Effective tax rate of 22.8%; and $293 million cash flow from operating activities. Fiscal 2022 Guidance Sales of $3.0 billion, a 6% increase; Forecast diluted earnings per share of $5.50, plus or minus $0.20; Forecast full year operating margins of 10.3%; Forecast tax rate of 25.5%; and Forecast $338 million cash flow from operating activities. Segment Results Aircraft Controls segment sales in the quarter were $298 million, 8% higher year over year. Total commercial aircraft revenues were $99 million, up 23%. Sales from the Genesys acquisition and strong sales to Airbus for the A350 compensated for lower 787 sales to Boeing. Commercial aftermarket sales increased 25% on strong 787 activity. Military aircraft revenues in the quarter were up 2% to $199 million. OEM revenues were 12% higher, to $144 million. Increased funded development and acquired sales from the Genesys acquisition offset lower F-35 Joint Strike Fighter sales. Military aftermarket sales of $55 million were off 16% when compared to a very strong quarter last year. Full-year Aircraft Controls segment sales were $1.16 billion, down 4%. Total military aircraft sales increased 8%, to $782 million. Military OEM sales, led by F-35 program sales and foreign military sales, were $574 million, an increase of 22%. Military aftermarket sales were off 17%, with the decrease tied to lower F-35 spares and V-22 repair volume. Sales to commercial customers were down 22%, with aftermarket down 7% year over year, all related to COVID challenges. Space and Defense segment sales in the quarter were $200 million, down 3% year over year. Space sales of $81 million were 3% lower on weakness in sales for launch vehicles, hypersonics, and satellite engines. Defense sales were down 4%, at $119 million, mainly tied to weaker sales of security products and missile controls. Space and Defense sales for the year increased 4%, to $799 million. Space sales were $333 million, up 13%, driven by increases across space vehicles and avionics. Defense sales of $466 million were off 2% on lower sales of security products and missile controls. Industrial Systems segment sales in the quarter were $226 million, in line with last year’s fourth quarter, excluding foreign exchange adjustments. Industrial automation sales were up 11% on strength across the portfolio tied to increases in global capital spending. Energy sales increased 10% year over year as off-shore production activity picked-up in the quarter. Sales into simulation and test applications were mostly flat. Medical product sales decreased 17% on slowing demand for OEM components used for sleep therapy and imaging. Full-year Industrial Systems segment sales were $892 million, down 2%. Industrial automation sales of $427 million were 5% higher. Energy sales were down 6%, at $120 million. Simulation and test sales were 13% lower as the flight simulator market has not rebounded from the effects of the pandemic. Sales of medical pumps and associated products, at $255 million, were 7% lower after the surge experienced last year. Consolidated 12-month backlog was $2.1 billion, up 24% from a year ago. “As we entered fiscal ’21, we projected that COVID would be with us throughout the year and anticipated top and bottom results similar to the second half of fiscal ’20,” said John Scannell, Chairman and CEO. “Looking back on the year, our business performed much better than this. As we now enter fiscal ’22, we’re optimistic about the future, while remaining realistic about the challenges. We anticipate sales of just over $3 billion and earnings per share of $5.50, plus or minus $0.20, representing an increase of 6% on the top line and 13% on the bottom line.” In conjunction with today’s release, Moog will host a conference call on Friday November 5, 2021 beginning at 10:00 a.m. ET, which will be broadcast live over the Internet. John Scannell, Chairman and CEO, and Jennifer Walter, CFO, will host the call. Listeners can access the call live or in replay mode at www.moog.com/investors/communications. Supplemental financial data will be available on the webcast web page approximately 90 minutes prior to the conference call. About Moog Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, marine and medical equipment. Additional information about the company can be found at www.moog.com. Cautionary Statement Information included or incorporated by reference in this press release that does not consist of historical facts, including statements accompanied by or containing words such as “may,” “will,” “should,” “believes,” “expects,” “expected,” “intends,” “plans,” “projects,” “approximate,” “estimates,” “predicts,” “potential,” “outlook,” “forecast,” “anticipates,” “presume” and “assume,” are forward-looking statements. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements. In evaluating these forward-looking statements, you should carefully consider the factors set forth below. Although it is not possible to create a comprehensive list of all factors that may cause actual results to differ from the results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors and other risks and uncertainties that arise from time to time are described in Item 1A “Risk Factors” of our Annual Report on Form 10-K and in our other periodic filings with the SEC and include the following: COVID-19 PANDEMIC RISKS We face various risks related to health pandemics such as the global COVID-19 pandemic, which have had material adverse consequences on our operations, financial position, cash flows, and those of our customers and suppliers. STRATEGIC RISKS We operate in highly competitive markets with competitors who may have greater resources than we possess; Our new products and technology research and development efforts are substantial and may not be successful which could reduce our sales and earnings; If we are unable to adequately enforce and protect our intellectual property or defend against assertions of infringement, our business and our ability to compete could be harmed; and Our sales and earnings may be affected if we cannot identify, acquire or integrate strategic acquisitions, or as we conduct divestitures. MARKET CONDITION RISKS The markets we serve are cyclical and sensitive to domestic and foreign economic conditions and events, which may cause our operating results to fluctuate; We depend heavily on government contracts that may not be fully funded or may be terminated, and the failure to receive funding or the termination of one or more of these contracts could reduce our sales and increase our costs; The loss of The Boeing Company as a customer or a significant reduction in sales to The Boeing Company could adversely impact our operating results; and We may not realize the full amounts reflected in our backlog as revenue, which could adversely affect our future revenue and growth prospects. OPERATIONAL RISKS Our business operations may be adversely affected by information systems interruptions, intrusions, or new software implementations; We may not be able to prevent, or timely detect, issues with our products and our manufacturing processes which may adversely affect our operations and our earnings; If our subcontractors or suppliers fail to perform their contractual obligations, our prime contract performance and our ability to obtain future business could be materially and adversely impacted; and The failure or misuse of our products may damage our reputation, necessitate a product recall or result in claims against us that exceed our insurance coverage, thereby requiring us to pay significant damages. FINANCIAL RISKS We make estimates in accounting for over-time contracts, and changes in these estimates may have significant impacts on our earnings; We enter into fixed-price contracts, which could subject us to losses if we have cost overruns; Our indebtedness and restrictive covenants under our credit facilities could limit our operational and financial flexibility; The phase out of LIBOR may negatively impact our debt agreements and financial position, results of operations and liquidity; Significant changes in discount rates, rates of return on pension assets, mortality tables and other factors could adversely affect our earnings and equity and increase our pension funding requirements; A write-off of all or part of our goodwill or other intangible assets could adversely affect our operating results and net worth; and Unforeseen exposure to additional income tax liabilities may affect our operating results. LEGAL AND COMPLIANCE RISKS Contracting on government programs is subject to significant regulation, including rules related to bidding, billing and accounting standards, and any false claims or non-compliance could subject us to fines, penalties or possible debarment; Our operations in foreign countries expose us to currency, political and trade risks and adverse changes in local legal and regulatory environments could impact our results of operations; Government regulations could limit our ability to sell our products outside the United States and otherwise adversely affect our business; We are involved in various legal proceedings, the outcome of which may be unfavorable to us; and Our operations are subject to environmental laws, and complying with those laws may cause us to incur significant costs. GENERAL RISKS Future terror attacks, war, natural disasters or other catastrophic events beyond our control could negatively impact our business; and Our performance could suffer if we cannot maintain our culture as well as attract, retain and engage our employees. While we believe we have identified and discussed above the material risks affecting our business, there may be additional factors, risks and uncertainties not currently known to us or that we currently consider immaterial that may affect the forward-looking statements made herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. Any forward-looking statement speaks only as of the date on which it is made, and we disclaim any obligation to update any forward-looking statement made in this report, except as required by law. Moog Inc. CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) (UNAUDITED) (dollars in thousands, except per share data) Three Months Ended Fiscal Year Ended October 2, 2021 October 3, 2020 October 2, 2021 October 3, 2020 Net sales $ 724,285 $ 706,895 $ 2,851,993 $ 2,884,554 Cost of sales 528,716 530,581 2,076,270 2,118,150 Inventory write-down — 3,913 — 22,708 Gross profit 195,569 172,401 775,723 743,696 Research and development 33,972 28,562 125,528 110,865 Selling, general and administrative 106,697 95,430 412,028 397,947 Interest 8,604 8,974 33,892 38,897 Long-lived asset impairment 1,500 5,968 1,500 37,839 Restructuring — 5,394 — 10,700 Pension settlement — 121,324 — 121,324 Other 2,116 6,413 (999) 20,707 Earnings (loss) before income taxes 42,680 (99,664) 203,774 5,417 Income taxes (benefit) 8,112 (21,687) 46,554 (3,788) Net earnings (loss) $ 34,568 $ (77,977) $ 157,220 $ 9,205 Net earnings (loss) per share Basic $ 1.08 $ (2.40) $ 4.90 $ 0.28 Diluted $ 1.07 $ (2.40) $ 4.87 $ 0.28 Average common shares outstanding Basic 32,104,127 32,539,248 32,112,589 33,257,684 Diluted 32,274,296 32,539,248 32,297,956 33,437,801 Results shown in the previous table include charges associated with the COVID-19 pandemic, as well as a charge associated with the purchase of a single premium non-participating group annuity contract from Metropolitan Tower Life Insurance Company and the related transfer of future benefit obligations and annuity administration for certain retirees and beneficiaries under the Moog Inc. Employees' Retirement Plan. COVID-19 impacts include inventory write-down, long-lived asset impairment and restructuring charges. The table below adjusts the income taxes (benefit), net earnings (loss) and diluted net earnings (loss) per share to exclude these impacts. Reconciliation to non-GAAP adjusted income taxes (benefit), net earnings (loss) and diluted net earnings (loss) per share are as follows: Three Months Ended Fiscal Year Ended October 2, 2021 October 3, 2020 October 2, 2021 October 3, 2020 As Reported: Earnings (loss) before income taxes $ 42,680 $ (99,664) $ 203,774 $ 5,417 Income taxes (benefit) 8,112 (21,687) 46,554 (3,788) Effective income tax rate 19.0 % 21.8 % 22.8 % (69.9) % Net earnings (loss) 34,568 (77,977) 157,220 9,205 Diluted net earnings (loss) per share $ 1.07 $ (2.40) $ 4.87 $ 0.28 COVID-19 Pandemic Charges: Earnings before income taxes $ — $ 15,275 $ — $ 71,247 Income taxes — 3,494 — 16,506 Net earnings — 11,781 — 54,741 Diluted net earnings per share $ — $ 0.36 $ — $ 1.68 Pension Settlement: Earnings before income taxes $ — $ 121,324 $ — $ 121,324 Income taxes — 28,632 — 28,632 Net earnings — 92,692 — 92,692 Diluted net earnings per share $ — $ 2.85 $ — $ 2.85 As Adjusted: Earnings before income taxes $ 42,680 $ 36,935 $ 203,774 $ 197,988 Income taxes 8,112 10,439 46,554 41,350 Effective income tax rate 19.0 % 28.3 % 22.8 % 20.9 % Net earnings 34,568 26,496 157,220 156,638 Diluted net earnings per share $ 1.07 $ 0.81 $ 4.87 $ 4.81 The diluted net earnings per share associated with the charges have been calculated using the quarterly average outstanding shares in the period in which the charges were incurred. Moog Inc. CONSOLIDATED SALES AND OPERATING PROFIT (UNAUDITED) (dollars in thousands) Three Months Ended Fiscal Year Ended October 2, 2021 October 3, 2020 October 2, 2021 October 3, 2020 Net sales: Aircraft Controls $ 297,972 $ 275,001 $ 1,161,238 $ 1,205,750 Space and Defense Controls 200,018 206,958 799,235 770,114 Industrial Systems 226,295 224,936 891,520 908,690 Net sales $ 724,285 $ 706,895 $ 2,851,993 $ 2,884,554 Operating profit: Aircraft Controls $ 26,193 $ 3,430 $ 96,678 $ 34,670 8.8 % 1.2 % 8.3 % 2.9 % Space and Defense Controls 17,296 29,443 88,333 101,667 8.6 % 14.2 % 11.1 % 13.2 % Industrial Systems 19,233 10,548 85,948 80,025 8.5 % 4.7 % 9.6 % 8.8 % Total operating profit 62,722 43,421 270,959 216,362 8.7 % 6.1 % 9.5 % 7.5 % Deductions from operating profit: Interest expense 8,604 8,974 33,892 38,897 Equity-based compensation expense 1,041 1,000 7,461 5,661 Pension settlement — 121,324 — 121,324 Non-service pension expense (income) 859 3,791 (2,194) 15,231 Corporate and other expenses, net 9,538 7,996 28,026 29,832 Earnings (loss) before income taxes $ 42,680 $ (99,664) $ 203,774 $ 5,417 Operating Profit and Margins - as adjusted are as follows: Three Months Ended Fiscal Year Ended October 2, 2021 October 3, 2020 October 2, 2021 October 3, 2020 Aircraft Controls operating profit - as reported $ 26,193 $ 3,430 $ 96,678 $ 34,670 Inventory write-down — 3,913 — 22,448 Long-lived asset impairment — (268) — 31,262 Restructuring — 444 — 3,340 Aircraft Controls operating profit - as adjusted $ 26,193 $ 7,519 $ 96,678 $ 91,720 8.8 % 2.7 % 8.3 % 7.6 % Space and Defense Controls operating profit - as reported $ 17,296 $ 29,443 $ 88,333 $ 101,667 Long-lived asset impairment — — — 341 Restructuring — — — 185 Space and Defense Controls operating profit - as adjusted $ 17,296 $ 29,443 $ 88,333 $ 102,193 8.6 % 14.2 % 11.1 % 13.3 % Industrial Systems operating profit - as reported $ 19,233 $ 10,548 $ 85,948 $ 80,025 Inventory write-down — — — 260 Long-lived asset impairment — 6,236 — 6,236 Restructuring — 4,950 — 7,175 Industrial Systems operating profit - as adjusted $ 19,233 $ 21,734 $ 85,948 $ 93,696 8.5 % 9.7 % 9.6 % 10.3 % Total operating profit - as adjusted $ 62,722 $ 58,696 $ 270,959 $ 287,609 8.7 % 8.3 % 9.5 % 10.0 % Moog Inc. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (dollars in thousands) October 2, 2021 October 3, 2020 ASSETS Current assets Cash and cash equivalents $ 99,599 $ 84,583 Restricted cash 1,315 489 Receivables, net 945,929 855,535 Inventories, net 613,095 623,043 Prepaid expenses and other current assets 58,842 49,837 Total current assets 1,718,780 1,613,487 Property, plant and equipment, net 645,778 600,498 Operating lease right-of-use assets 60,355 68,393 Goodwill 851,605 821,856 Intangible assets, net 106,095 85,046 Deferred income taxes 17,769 18,924 Other assets 32,787 17,627 Total assets $ 3,433,169 $ 3,225,831 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Current installments of long-term debt $ 80,365 $ 350 Accounts payable 200,602 176,868 Accrued compensation 112,703 109,510 Contract advances 263,686 203,338 Accrued liabilities and other 212,005 220,488 Total current liabilities 869,361 710,554 Long-term debt, excluding current installments 823,355 929,982 Long-term pension and retirement obligations 162,728 183,366 Deferred income taxes 64,642 40,474 Other long-term liabilities 112,939 118,372 Total liabilities 2,033,025 1,982,748 Shareholders’ equity Common stock - Class A 43,803 43,799 Common stock - Class B 7,477 7,481 Additional paid-in capital 509,622 472,645 Retained earnings 2,237,848 2,112,734 Treasury shares (1,007,506) (990,783) Stock Employee Compensation Trust (79,776) (64,242) Supplemental Retirement Plan Trust (63,764) (53,098) Accumulated other comprehensive loss (247,560) (285,453) Total shareholders’ equity 1,400,144 1,243,083 Total liabilities and shareholders’ equity $ 3,433,169 $ 3,225,831 Moog Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (dollars in thousands) Fiscal Year Ended October 2, 2021 October 3, 2020 CASH FLOWS FROM OPERATING ACTIVITIES Net earnings $ 157,220 $ 9,205 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 76,671 74,243 Amortization 13,488 12,729 Deferred income taxes 8,162 (40,845) Equity-based compensation expense 7,461 5,661 Impairment of long-lived assets and inventory write-down 1,500 60,547 Pension settlement — 121,324 Other 745 9,636 Changes in assets and liabilities providing (using) cash: Receivables (73,459) 111,525 Inventories 19,576 (99,015) Accounts payable 20,520 (84,065) Contract advances 59,298 65,680 Accrued expenses 2,290 (3,516) Accrued income taxes 4,653 (17,964) Net pension and post retirement liabilities 12,503 33,305 Other assets and liabilities (17,402) 20,727 Net cash provided by operating activities 293,226 279,177 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of businesses, net of cash acquired (77,600) (54,265) Purchase of property, plant and equipment (128,734) (88,284) Other investing transactions 15,177 (3,644) Net cash used by investing activities (191,157) (146,193) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from revolving lines of credit 799,950 1,151,550 Payments on revolving lines of credit (838,936) (1,187,159) Proceeds from long-term debt 78,700 15,128 Payments on long-term debt (68,080) (74,470) Proceeds from senior notes, net of issuance costs — 491,769 Payments on senior notes — (300,000) Payments on finance lease obligations (2,156) (1,167) Payment of dividends (32,106) (25,210) Proceeds from sale of treasury stock 10,866 7,014 Purchase of outstanding shares for treasury (31,673) (232,290) Proceeds from sale of stock held by SECT 679 24,721 Purchase of stock held by SECT (4,239) (6,774) Other financing transactions — (5,878) Net cash used by financing activities (86,995) (142,766) Effect of exchange rate changes on cash 768 2,306 Increase (decrease) in cash, cash equivalents and restricted cash 15,842 (7,476) Cash, cash equivalents and restricted cash at beginning of period 85,072 92,548 Cash, cash equivalents and restricted cash at end of period $ 100,914 $ 85,072
- MOOG INC. REPORTS FISCAL YEAR END 2021 RESULTS AND INITIAL GUIDANCE FOR FISCAL YEAR 2022
Nov 5, 2021
EAST AURORA, N.Y.--(BUSINESS WIRE)--MOOG INC. (NYSE: MOG.A AND MOG.B) ANNOUNCED TODAY FINANCIAL RESULTS FOR THE QUARTER AND FISCAL YEAR ENDED OCTOBER 2, 2021. FOURTH QUARTER HIGHLIGHTS SALES OF $724 MILLION, UP 2% FROM A YEAR AGO; GAAP DILUTED EARNINGS PER SHARE OF $1.07, UP 32%, INCLUDING $0.18 OF ONE-TIME ADJUSTMENTS; OPERATING MARGINS OF 8.7%; EFFECTIVE TAX RATE OF 19.0%; AND $63 MILLION CASH FLOW FROM OPERATING ACTIVITIES. FULL-YEAR 2021 HIGHLIGHTS SALES OF $2.9 BILLION, DOWN 1% FROM A YEAR AGO; GAAP DILUTED EARNINGS PER SHARE OF $4.87, INCLUDING $0.18 OF ONE-TIME ADJUSTMENTS, UP 1% FROM ADJUSTED RESULTS A YEAR AGO; OPERATING MARGINS OF 9.5%; EFFECTIVE TAX RATE OF 22.8%; AND $293 MILLION CASH FLOW FROM OPERATING ACTIVITIES. FISCAL 2022 GUIDANCE SALES OF $3.0 BILLION, A 6% INCREASE; FORECAST DILUTED EARNINGS PER SHARE OF $5.50, PLUS OR MINUS $0.20; FORECAST FULL YEAR OPERATING MARGINS OF 10.3%; FORECAST TAX RATE OF 25.5%; AND FORECAST $338 MILLION CASH FLOW FROM OPERATING ACTIVITIES. SEGMENT RESULTS AIRCRAFT CONTROLS SEGMENT SALES IN THE QUARTER WERE $298 MILLION, 8% HIGHER YEAR OVER YEAR. TOTAL COMMERCIAL AIRCRAFT REVENUES WERE $99 MILLION, UP 23%. SALES FROM THE GENESYS ACQUISITION AND STRONG SALES TO AIRBUS FOR THE A350 COMPENSATED FOR LOWER 787 SALES TO BOEING. COMMERCIAL AFTERMARKET SALES INCREASED 25% ON STRONG 787 ACTIVITY. MILITARY AIRCRAFT REVENUES IN THE QUARTER WERE UP 2% TO $199 MILLION. OEM REVENUES WERE 12% HIGHER, TO $144 MILLION. INCREASED FUNDED DEVELOPMENT AND ACQUIRED SALES FROM THE GENESYS ACQUISITION OFFSET LOWER F-35 JOINT STRIKE FIGHTER SALES. MILITARY AFTERMARKET SALES OF $55 MILLION WERE OFF 16% WHEN COMPARED TO A VERY STRONG QUARTER LAST YEAR. FULL-YEAR AIRCRAFT CONTROLS SEGMENT SALES WERE $1.16 BILLION, DOWN 4%. TOTAL MILITARY AIRCRAFT SALES INCREASED 8%, TO $782 MILLION. MILITARY OEM SALES, LED BY F-35 PROGRAM SALES AND FOREIGN MILITARY SALES, WERE $574 MILLION, AN INCREASE OF 22%. MILITARY AFTERMARKET SALES WERE OFF 17%, WITH THE DECREASE TIED TO LOWER F-35 SPARES AND V-22 REPAIR VOLUME. SALES TO COMMERCIAL CUSTOMERS WERE DOWN 22%, WITH AFTERMARKET DOWN 7% YEAR OVER YEAR, ALL RELATED TO COVID CHALLENGES. SPACE AND DEFENSE SEGMENT SALES IN THE QUARTER WERE $200 MILLION, DOWN 3% YEAR OVER YEAR. SPACE SALES OF $81 MILLION WERE 3% LOWER ON WEAKNESS IN SALES FOR LAUNCH VEHICLES, HYPERSONICS, AND SATELLITE ENGINES. DEFENSE SALES WERE DOWN 4%, AT $119 MILLION, MAINLY TIED TO WEAKER SALES OF SECURITY PRODUCTS AND MISSILE CONTROLS. SPACE AND DEFENSE SALES FOR THE YEAR INCREASED 4%, TO $799 MILLION. SPACE SALES WERE $333 MILLION, UP 13%, DRIVEN BY INCREASES ACROSS SPACE VEHICLES AND AVIONICS. DEFENSE SALES OF $466 MILLION WERE OFF 2% ON LOWER SALES OF SECURITY PRODUCTS AND MISSILE CONTROLS. INDUSTRIAL SYSTEMS SEGMENT SALES IN THE QUARTER WERE $226 MILLION, IN LINE WITH LAST YEAR’S FOURTH QUARTER, EXCLUDING FOREIGN EXCHANGE ADJUSTMENTS. INDUSTRIAL AUTOMATION SALES WERE UP 11% ON STRENGTH ACROSS THE PORTFOLIO TIED TO INCREASES IN GLOBAL CAPITAL SPENDING. ENERGY SALES INCREASED 10% YEAR OVER YEAR AS OFF-SHORE PRODUCTION ACTIVITY PICKED-UP IN THE QUARTER. SALES INTO SIMULATION AND TEST APPLICATIONS WERE MOSTLY FLAT. MEDICAL PRODUCT SALES DECREASED 17% ON SLOWING DEMAND FOR OEM COMPONENTS USED FOR SLEEP THERAPY AND IMAGING. FULL-YEAR INDUSTRIAL SYSTEMS SEGMENT SALES WERE $892 MILLION, DOWN 2%. INDUSTRIAL AUTOMATION SALES OF $427 MILLION WERE 5% HIGHER. ENERGY SALES WERE DOWN 6%, AT $120 MILLION. SIMULATION AND TEST SALES WERE 13% LOWER AS THE FLIGHT SIMULATOR MARKET HAS NOT REBOUNDED FROM THE EFFECTS OF THE PANDEMIC. SALES OF MEDICAL PUMPS AND ASSOCIATED PRODUCTS, AT $255 MILLION, WERE 7% LOWER AFTER THE SURGE EXPERIENCED LAST YEAR. CONSOLIDATED 12-MONTH BACKLOG WAS $2.1 BILLION, UP 24% FROM A YEAR AGO. “AS WE ENTERED FISCAL ’21, WE PROJECTED THAT COVID WOULD BE WITH US THROUGHOUT THE YEAR AND ANTICIPATED TOP AND BOTTOM RESULTS SIMILAR TO THE SECOND HALF OF FISCAL ’20,” SAID JOHN SCANNELL, CHAIRMAN AND CEO. “LOOKING BACK ON THE YEAR, OUR BUSINESS PERFORMED MUCH BETTER THAN THIS. AS WE NOW ENTER FISCAL ’22, WE’RE OPTIMISTIC ABOUT THE FUTURE, WHILE REMAINING REALISTIC ABOUT THE CHALLENGES. WE ANTICIPATE SALES OF JUST OVER $3 BILLION AND EARNINGS PER SHARE OF $5.50, PLUS OR MINUS $0.20, REPRESENTING AN INCREASE OF 6% ON THE TOP LINE AND 13% ON THE BOTTOM LINE.” IN CONJUNCTION WITH TODAY’S RELEASE, MOOG WILL HOST A CONFERENCE CALL ON FRIDAY NOVEMBER 5, 2021 BEGINNING AT 10:00 A.M. ET, WHICH WILL BE BROADCAST LIVE OVER THE INTERNET. JOHN SCANNELL, CHAIRMAN AND CEO, AND JENNIFER WALTER, CFO, WILL HOST THE CALL. LISTENERS CAN ACCESS THE CALL LIVE OR IN REPLAY MODE AT WWW.MOOG.COM/INVESTORS/COMMUNICATIONS. SUPPLEMENTAL FINANCIAL DATA WILL BE AVAILABLE ON THE WEBCAST WEB PAGE APPROXIMATELY 90 MINUTES PRIOR TO THE CONFERENCE CALL. ABOUT MOOG MOOG INC. IS A WORLDWIDE DESIGNER, MANUFACTURER, AND INTEGRATOR OF PRECISION CONTROL COMPONENTS AND SYSTEMS. MOOG’S HIGH-PERFORMANCE SYSTEMS CONTROL MILITARY AND COMMERCIAL AIRCRAFT, SATELLITES AND SPACE VEHICLES, LAUNCH VEHICLES, MISSILES, AUTOMATED INDUSTRIAL MACHINERY, MARINE AND MEDICAL EQUIPMENT. ADDITIONAL INFORMATION ABOUT THE COMPANY CAN BE FOUND AT WWW.MOOG.COM. CAUTIONARY STATEMENT INFORMATION INCLUDED OR INCORPORATED BY REFERENCE IN THIS PRESS RELEASE THAT DOES NOT CONSIST OF HISTORICAL FACTS, INCLUDING STATEMENTS ACCOMPANIED BY OR CONTAINING WORDS SUCH AS “MAY,” “WILL,” “SHOULD,” “BELIEVES,” “EXPECTS,” “EXPECTED,” “INTENDS,” “PLANS,” “PROJECTS,” “APPROXIMATE,” “ESTIMATES,” “PREDICTS,” “POTENTIAL,” “OUTLOOK,” “FORECAST,” “ANTICIPATES,” “PRESUME” AND “ASSUME,” ARE FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THESE FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND ARE SUBJECT TO SEVERAL FACTORS, RISKS AND UNCERTAINTIES, THE IMPACT OR OCCURRENCE OF WHICH COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE EXPECTED RESULTS DESCRIBED IN THE FORWARD-LOOKING STATEMENTS. IN EVALUATING THESE FORWARD-LOOKING STATEMENTS, YOU SHOULD CAREFULLY CONSIDER THE FACTORS SET FORTH BELOW. ALTHOUGH IT IS NOT POSSIBLE TO CREATE A COMPREHENSIVE LIST OF ALL FACTORS THAT MAY CAUSE ACTUAL RESULTS TO DIFFER FROM THE RESULTS EXPRESSED OR IMPLIED BY OUR FORWARD-LOOKING STATEMENTS OR THAT MAY AFFECT OUR FUTURE RESULTS, SOME OF THESE FACTORS AND OTHER RISKS AND UNCERTAINTIES THAT ARISE FROM TIME TO TIME ARE DESCRIBED IN ITEM 1A “RISK FACTORS” OF OUR ANNUAL REPORT ON FORM 10-K AND IN OUR OTHER PERIODIC FILINGS WITH THE SEC AND INCLUDE THE FOLLOWING: COVID-19 PANDEMIC RISKS WE FACE VARIOUS RISKS RELATED TO HEALTH PANDEMICS SUCH AS THE GLOBAL COVID-19 PANDEMIC, WHICH HAVE HAD MATERIAL ADVERSE CONSEQUENCES ON OUR OPERATIONS, FINANCIAL POSITION, CASH FLOWS, AND THOSE OF OUR CUSTOMERS AND SUPPLIERS. STRATEGIC RISKS WE OPERATE IN HIGHLY COMPETITIVE MARKETS WITH COMPETITORS WHO MAY HAVE GREATER RESOURCES THAN WE POSSESS; OUR NEW PRODUCTS AND TECHNOLOGY RESEARCH AND DEVELOPMENT EFFORTS ARE SUBSTANTIAL AND MAY NOT BE SUCCESSFUL WHICH COULD REDUCE OUR SALES AND EARNINGS; IF WE ARE UNABLE TO ADEQUATELY ENFORCE AND PROTECT OUR INTELLECTUAL PROPERTY OR DEFEND AGAINST ASSERTIONS OF INFRINGEMENT, OUR BUSINESS AND OUR ABILITY TO COMPETE COULD BE HARMED; AND OUR SALES AND EARNINGS MAY BE AFFECTED IF WE CANNOT IDENTIFY, ACQUIRE OR INTEGRATE STRATEGIC ACQUISITIONS, OR AS WE CONDUCT DIVESTITURES. MARKET CONDITION RISKS THE MARKETS WE SERVE ARE CYCLICAL AND SENSITIVE TO DOMESTIC AND FOREIGN ECONOMIC CONDITIONS AND EVENTS, WHICH MAY CAUSE OUR OPERATING RESULTS TO FLUCTUATE; WE DEPEND HEAVILY ON GOVERNMENT CONTRACTS THAT MAY NOT BE FULLY FUNDED OR MAY BE TERMINATED, AND THE FAILURE TO RECEIVE FUNDING OR THE TERMINATION OF ONE OR MORE OF THESE CONTRACTS COULD REDUCE OUR SALES AND INCREASE OUR COSTS; THE LOSS OF THE BOEING COMPANY AS A CUSTOMER OR A SIGNIFICANT REDUCTION IN SALES TO THE BOEING COMPANY COULD ADVERSELY IMPACT OUR OPERATING RESULTS; AND WE MAY NOT REALIZE THE FULL AMOUNTS REFLECTED IN OUR BACKLOG AS REVENUE, WHICH COULD ADVERSELY AFFECT OUR FUTURE REVENUE AND GROWTH PROSPECTS. OPERATIONAL RISKS OUR BUSINESS OPERATIONS MAY BE ADVERSELY AFFECTED BY INFORMATION SYSTEMS INTERRUPTIONS, INTRUSIONS, OR NEW SOFTWARE IMPLEMENTATIONS; WE MAY NOT BE ABLE TO PREVENT, OR TIMELY DETECT, ISSUES WITH OUR PRODUCTS AND OUR MANUFACTURING PROCESSES WHICH MAY ADVERSELY AFFECT OUR OPERATIONS AND OUR EARNINGS; IF OUR SUBCONTRACTORS OR SUPPLIERS FAIL TO PERFORM THEIR CONTRACTUAL OBLIGATIONS, OUR PRIME CONTRACT PERFORMANCE AND OUR ABILITY TO OBTAIN FUTURE BUSINESS COULD BE MATERIALLY AND ADVERSELY IMPACTED; AND THE FAILURE OR MISUSE OF OUR PRODUCTS MAY DAMAGE OUR REPUTATION, NECESSITATE A PRODUCT RECALL OR RESULT IN CLAIMS AGAINST US THAT EXCEED OUR INSURANCE COVERAGE, THEREBY REQUIRING US TO PAY SIGNIFICANT DAMAGES. FINANCIAL RISKS WE MAKE ESTIMATES IN ACCOUNTING FOR OVER-TIME CONTRACTS, AND CHANGES IN THESE ESTIMATES MAY HAVE SIGNIFICANT IMPACTS ON OUR EARNINGS; WE ENTER INTO FIXED-PRICE CONTRACTS, WHICH COULD SUBJECT US TO LOSSES IF WE HAVE COST OVERRUNS; OUR INDEBTEDNESS AND RESTRICTIVE COVENANTS UNDER OUR CREDIT FACILITIES COULD LIMIT OUR OPERATIONAL AND FINANCIAL FLEXIBILITY; THE PHASE OUT OF LIBOR MAY NEGATIVELY IMPACT OUR DEBT AGREEMENTS AND FINANCIAL POSITION, RESULTS OF OPERATIONS AND LIQUIDITY; SIGNIFICANT CHANGES IN DISCOUNT RATES, RATES OF RETURN ON PENSION ASSETS, MORTALITY TABLES AND OTHER FACTORS COULD ADVERSELY AFFECT OUR EARNINGS AND EQUITY AND INCREASE OUR PENSION FUNDING REQUIREMENTS; A WRITE-OFF OF ALL OR PART OF OUR GOODWILL OR OTHER INTANGIBLE ASSETS COULD ADVERSELY AFFECT OUR OPERATING RESULTS AND NET WORTH; AND UNFORESEEN EXPOSURE TO ADDITIONAL INCOME TAX LIABILITIES MAY AFFECT OUR OPERATING RESULTS. LEGAL AND COMPLIANCE RISKS CONTRACTING ON GOVERNMENT PROGRAMS IS SUBJECT TO SIGNIFICANT REGULATION, INCLUDING RULES RELATED TO BIDDING, BILLING AND ACCOUNTING STANDARDS, AND ANY FALSE CLAIMS OR NON-COMPLIANCE COULD SUBJECT US TO FINES, PENALTIES OR POSSIBLE DEBARMENT; OUR OPERATIONS IN FOREIGN COUNTRIES EXPOSE US TO CURRENCY, POLITICAL AND TRADE RISKS AND ADVERSE CHANGES IN LOCAL LEGAL AND REGULATORY ENVIRONMENTS COULD IMPACT OUR RESULTS OF OPERATIONS; GOVERNMENT REGULATIONS COULD LIMIT OUR ABILITY TO SELL OUR PRODUCTS OUTSIDE THE UNITED STATES AND OTHERWISE ADVERSELY AFFECT OUR BUSINESS; WE ARE INVOLVED IN VARIOUS LEGAL PROCEEDINGS, THE OUTCOME OF WHICH MAY BE UNFAVORABLE TO US; AND OUR OPERATIONS ARE SUBJECT TO ENVIRONMENTAL LAWS, AND COMPLYING WITH THOSE LAWS MAY CAUSE US TO INCUR SIGNIFICANT COSTS. GENERAL RISKS FUTURE TERROR ATTACKS, WAR, NATURAL DISASTERS OR OTHER CATASTROPHIC EVENTS BEYOND OUR CONTROL COULD NEGATIVELY IMPACT OUR BUSINESS; AND OUR PERFORMANCE COULD SUFFER IF WE CANNOT MAINTAIN OUR CULTURE AS WELL AS ATTRACT, RETAIN AND ENGAGE OUR EMPLOYEES. WHILE WE BELIEVE WE HAVE IDENTIFIED AND DISCUSSED ABOVE THE MATERIAL RISKS AFFECTING OUR BUSINESS, THERE MAY BE ADDITIONAL FACTORS, RISKS AND UNCERTAINTIES NOT CURRENTLY KNOWN TO US OR THAT WE CURRENTLY CONSIDER IMMATERIAL THAT MAY AFFECT THE FORWARD-LOOKING STATEMENTS MADE HEREIN. GIVEN THESE FACTORS, RISKS AND UNCERTAINTIES, INVESTORS SHOULD NOT PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS AS PREDICTIVE OF FUTURE RESULTS. ANY FORWARD-LOOKING STATEMENT SPEAKS ONLY AS OF THE DATE ON WHICH IT IS MADE, AND WE DISCLAIM ANY OBLIGATION TO UPDATE ANY FORWARD-LOOKING STATEMENT MADE IN THIS REPORT, EXCEPT AS REQUIRED BY LAW. MOOG INC. CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) THREE MONTHS ENDED FISCAL YEAR ENDED OCTOBER 2, 2021 OCTOBER 3, 2020 OCTOBER 2, 2021 OCTOBER 3, 2020 NET SALES $ 724,285 $ 706,895 $ 2,851,993 $ 2,884,554 COST OF SALES 528,716 530,581 2,076,270 2,118,150 INVENTORY WRITE-DOWN — 3,913 — 22,708 GROSS PROFIT 195,569 172,401 775,723 743,696 RESEARCH AND DEVELOPMENT 33,972 28,562 125,528 110,865 SELLING, GENERAL AND ADMINISTRATIVE 106,697 95,430 412,028 397,947 INTEREST 8,604 8,974 33,892 38,897 LONG-LIVED ASSET IMPAIRMENT 1,500 5,968 1,500 37,839 RESTRUCTURING — 5,394 — 10,700 PENSION SETTLEMENT — 121,324 — 121,324 OTHER 2,116 6,413 (999) 20,707 EARNINGS (LOSS) BEFORE INCOME TAXES 42,680 (99,664) 203,774 5,417 INCOME TAXES (BENEFIT) 8,112 (21,687) 46,554 (3,788) NET EARNINGS (LOSS) $ 34,568 $ (77,977) $ 157,220 $ 9,205 NET EARNINGS (LOSS) PER SHARE BASIC $ 1.08 $ (2.40) $ 4.90 $ 0.28 DILUTED $ 1.07 $ (2.40) $ 4.87 $ 0.28 AVERAGE COMMON SHARES OUTSTANDING BASIC 32,104,127 32,539,248 32,112,589 33,257,684 DILUTED 32,274,296 32,539,248 32,297,956 33,437,801 RESULTS SHOWN IN THE PREVIOUS TABLE INCLUDE CHARGES ASSOCIATED WITH THE COVID-19 PANDEMIC, AS WELL AS A CHARGE ASSOCIATED WITH THE PURCHASE OF A SINGLE PREMIUM NON-PARTICIPATING GROUP ANNUITY CONTRACT FROM METROPOLITAN TOWER LIFE INSURANCE COMPANY AND THE RELATED TRANSFER OF FUTURE BENEFIT OBLIGATIONS AND ANNUITY ADMINISTRATION FOR CERTAIN RETIREES AND BENEFICIARIES UNDER THE MOOG INC. EMPLOYEES' RETIREMENT PLAN. COVID-19 IMPACTS INCLUDE INVENTORY WRITE-DOWN, LONG-LIVED ASSET IMPAIRMENT AND RESTRUCTURING CHARGES. THE TABLE BELOW ADJUSTS THE INCOME TAXES (BENEFIT), NET EARNINGS (LOSS) AND DILUTED NET EARNINGS (LOSS) PER SHARE TO EXCLUDE THESE IMPACTS. RECONCILIATION TO NON-GAAP ADJUSTED INCOME TAXES (BENEFIT), NET EARNINGS (LOSS) AND DILUTED NET EARNINGS (LOSS) PER SHARE ARE AS FOLLOWS: THREE MONTHS ENDED FISCAL YEAR ENDED OCTOBER 2, 2021 OCTOBER 3, 2020 OCTOBER 2, 2021 OCTOBER 3, 2020 AS REPORTED: EARNINGS (LOSS) BEFORE INCOME TAXES $ 42,680 $ (99,664) $ 203,774 $ 5,417 INCOME TAXES (BENEFIT) 8,112 (21,687) 46,554 (3,788) EFFECTIVE INCOME TAX RATE 19.0 % 21.8 % 22.8 % (69.9) % NET EARNINGS (LOSS) 34,568 (77,977) 157,220 9,205 DILUTED NET EARNINGS (LOSS) PER SHARE $ 1.07 $ (2.40) $ 4.87 $ 0.28 COVID-19 PANDEMIC CHARGES: EARNINGS BEFORE INCOME TAXES $ — $ 15,275 $ — $ 71,247 INCOME TAXES — 3,494 — 16,506 NET EARNINGS — 11,781 — 54,741 DILUTED NET EARNINGS PER SHARE $ — $ 0.36 $ — $ 1.68 PENSION SETTLEMENT: EARNINGS BEFORE INCOME TAXES $ — $ 121,324 $ — $ 121,324 INCOME TAXES — 28,632 — 28,632 NET EARNINGS — 92,692 — 92,692 DILUTED NET EARNINGS PER SHARE $ — $ 2.85 $ — $ 2.85 AS ADJUSTED: EARNINGS BEFORE INCOME TAXES $ 42,680 $ 36,935 $ 203,774 $ 197,988 INCOME TAXES 8,112 10,439 46,554 41,350 EFFECTIVE INCOME TAX RATE 19.0 % 28.3 % 22.8 % 20.9 % NET EARNINGS 34,568 26,496 157,220 156,638 DILUTED NET EARNINGS PER SHARE $ 1.07 $ 0.81 $ 4.87 $ 4.81 THE DILUTED NET EARNINGS PER SHARE ASSOCIATED WITH THE CHARGES HAVE BEEN CALCULATED USING THE QUARTERLY AVERAGE OUTSTANDING SHARES IN THE PERIOD IN WHICH THE CHARGES WERE INCURRED. MOOG INC. CONSOLIDATED SALES AND OPERATING PROFIT (UNAUDITED) (DOLLARS IN THOUSANDS) THREE MONTHS ENDED FISCAL YEAR ENDED OCTOBER 2, 2021 OCTOBER 3, 2020 OCTOBER 2, 2021 OCTOBER 3, 2020 NET SALES: AIRCRAFT CONTROLS $ 297,972 $ 275,001 $ 1,161,238 $ 1,205,750 SPACE AND DEFENSE CONTROLS 200,018 206,958 799,235 770,114 INDUSTRIAL SYSTEMS 226,295 224,936 891,520 908,690 NET SALES $ 724,285 $ 706,895 $ 2,851,993 $ 2,884,554 OPERATING PROFIT: AIRCRAFT CONTROLS $ 26,193 $ 3,430 $ 96,678 $ 34,670 8.8 % 1.2 % 8.3 % 2.9 % SPACE AND DEFENSE CONTROLS 17,296 29,443 88,333 101,667 8.6 % 14.2 % 11.1 % 13.2 % INDUSTRIAL SYSTEMS 19,233 10,548 85,948 80,025 8.5 % 4.7 % 9.6 % 8.8 % TOTAL OPERATING PROFIT 62,722 43,421 270,959 216,362 8.7 % 6.1 % 9.5 % 7.5 % DEDUCTIONS FROM OPERATING PROFIT: INTEREST EXPENSE 8,604 8,974 33,892 38,897 EQUITY-BASED COMPENSATION EXPENSE 1,041 1,000 7,461 5,661 PENSION SETTLEMENT — 121,324 — 121,324 NON-SERVICE PENSION EXPENSE (INCOME) 859 3,791 (2,194) 15,231 CORPORATE AND OTHER EXPENSES, NET 9,538 7,996 28,026 29,832 EARNINGS (LOSS) BEFORE INCOME TAXES $ 42,680 $ (99,664) $ 203,774 $ 5,417 OPERATING PROFIT AND MARGINS - AS ADJUSTED ARE AS FOLLOWS: THREE MONTHS ENDED FISCAL YEAR ENDED OCTOBER 2, 2021 OCTOBER 3, 2020 OCTOBER 2, 2021 OCTOBER 3, 2020 AIRCRAFT CONTROLS OPERATING PROFIT - AS REPORTED $ 26,193 $ 3,430 $ 96,678 $ 34,670 INVENTORY WRITE-DOWN — 3,913 — 22,448 LONG-LIVED ASSET IMPAIRMENT — (268) — 31,262 RESTRUCTURING — 444 — 3,340 AIRCRAFT CONTROLS OPERATING PROFIT - AS ADJUSTED $ 26,193 $ 7,519 $ 96,678 $ 91,720 8.8 % 2.7 % 8.3 % 7.6 % SPACE AND DEFENSE CONTROLS OPERATING PROFIT - AS REPORTED $ 17,296 $ 29,443 $ 88,333 $ 101,667 LONG-LIVED ASSET IMPAIRMENT — — — 341 RESTRUCTURING — — — 185 SPACE AND DEFENSE CONTROLS OPERATING PROFIT - AS ADJUSTED $ 17,296 $ 29,443 $ 88,333 $ 102,193 8.6 % 14.2 % 11.1 % 13.3 % INDUSTRIAL SYSTEMS OPERATING PROFIT - AS REPORTED $ 19,233 $ 10,548 $ 85,948 $ 80,025 INVENTORY WRITE-DOWN — — — 260 LONG-LIVED ASSET IMPAIRMENT — 6,236 — 6,236 RESTRUCTURING — 4,950 — 7,175 INDUSTRIAL SYSTEMS OPERATING PROFIT - AS ADJUSTED $ 19,233 $ 21,734 $ 85,948 $ 93,696 8.5 % 9.7 % 9.6 % 10.3 % TOTAL OPERATING PROFIT - AS ADJUSTED $ 62,722 $ 58,696 $ 270,959 $ 287,609 8.7 % 8.3 % 9.5 % 10.0 % MOOG INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (DOLLARS IN THOUSANDS) OCTOBER 2, 2021 OCTOBER 3, 2020 ASSETS CURRENT ASSETS CASH AND CASH EQUIVALENTS $ 99,599 $ 84,583 RESTRICTED CASH 1,315 489 RECEIVABLES, NET 945,929 855,535 INVENTORIES, NET 613,095 623,043 PREPAID EXPENSES AND OTHER CURRENT ASSETS 58,842 49,837 TOTAL CURRENT ASSETS 1,718,780 1,613,487 PROPERTY, PLANT AND EQUIPMENT, NET 645,778 600,498 OPERATING LEASE RIGHT-OF-USE ASSETS 60,355 68,393 GOODWILL 851,605 821,856 INTANGIBLE ASSETS, NET 106,095 85,046 DEFERRED INCOME TAXES 17,769 18,924 OTHER ASSETS 32,787 17,627 TOTAL ASSETS $ 3,433,169 $ 3,225,831 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES CURRENT INSTALLMENTS OF LONG-TERM DEBT $ 80,365 $ 350 ACCOUNTS PAYABLE 200,602 176,868 ACCRUED COMPENSATION 112,703 109,510 CONTRACT ADVANCES 263,686 203,338 ACCRUED LIABILITIES AND OTHER 212,005 220,488 TOTAL CURRENT LIABILITIES 869,361 710,554 LONG-TERM DEBT, EXCLUDING CURRENT INSTALLMENTS 823,355 929,982 LONG-TERM PENSION AND RETIREMENT OBLIGATIONS 162,728 183,366 DEFERRED INCOME TAXES 64,642 40,474 OTHER LONG-TERM LIABILITIES 112,939 118,372 TOTAL LIABILITIES 2,033,025 1,982,748 SHAREHOLDERS’ EQUITY COMMON STOCK - CLASS A 43,803 43,799 COMMON STOCK - CLASS B 7,477 7,481 ADDITIONAL PAID-IN CAPITAL 509,622 472,645 RETAINED EARNINGS 2,237,848 2,112,734 TREASURY SHARES (1,007,506) (990,783) STOCK EMPLOYEE COMPENSATION TRUST (79,776) (64,242) SUPPLEMENTAL RETIREMENT PLAN TRUST (63,764) (53,098) ACCUMULATED OTHER COMPREHENSIVE LOSS (247,560) (285,453) TOTAL SHAREHOLDERS’ EQUITY 1,400,144 1,243,083 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 3,433,169 $ 3,225,831 MOOG INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (DOLLARS IN THOUSANDS) FISCAL YEAR ENDED OCTOBER 2, 2021 OCTOBER 3, 2020 CASH FLOWS FROM OPERATING ACTIVITIES NET EARNINGS $ 157,220 $ 9,205 ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH PROVIDED BY OPERATING ACTIVITIES: DEPRECIATION 76,671 74,243 AMORTIZATION 13,488 12,729 DEFERRED INCOME TAXES 8,162 (40,845) EQUITY-BASED COMPENSATION EXPENSE 7,461 5,661 IMPAIRMENT OF LONG-LIVED ASSETS AND INVENTORY WRITE-DOWN 1,500 60,547 PENSION SETTLEMENT — 121,324 OTHER 745 9,636 CHANGES IN ASSETS AND LIABILITIES PROVIDING (USING) CASH: RECEIVABLES (73,459) 111,525 INVENTORIES 19,576 (99,015) ACCOUNTS PAYABLE 20,520 (84,065) CONTRACT ADVANCES 59,298 65,680 ACCRUED EXPENSES 2,290 (3,516) ACCRUED INCOME TAXES 4,653 (17,964) NET PENSION AND POST RETIREMENT LIABILITIES 12,503 33,305 OTHER ASSETS AND LIABILITIES (17,402) 20,727 NET CASH PROVIDED BY OPERATING ACTIVITIES 293,226 279,177 CASH FLOWS FROM INVESTING ACTIVITIES ACQUISITIONS OF BUSINESSES, NET OF CASH ACQUIRED (77,600) (54,265) PURCHASE OF PROPERTY, PLANT AND EQUIPMENT (128,734) (88,284) OTHER INVESTING TRANSACTIONS 15,177 (3,644) NET CASH USED BY INVESTING ACTIVITIES (191,157) (146,193) CASH FLOWS FROM FINANCING ACTIVITIES PROCEEDS FROM REVOLVING LINES OF CREDIT 799,950 1,151,550 PAYMENTS ON REVOLVING LINES OF CREDIT (838,936) (1,187,159) PROCEEDS FROM LONG-TERM DEBT 78,700 15,128 PAYMENTS ON LONG-TERM DEBT (68,080) (74,470) PROCEEDS FROM SENIOR NOTES, NET OF ISSUANCE COSTS — 491,769 PAYMENTS ON SENIOR NOTES — (300,000) PAYMENTS ON FINANCE LEASE OBLIGATIONS (2,156) (1,167) PAYMENT OF DIVIDENDS (32,106) (25,210) PROCEEDS FROM SALE OF TREASURY STOCK 10,866 7,014 PURCHASE OF OUTSTANDING SHARES FOR TREASURY (31,673) (232,290) PROCEEDS FROM SALE OF STOCK HELD BY SECT 679 24,721 PURCHASE OF STOCK HELD BY SECT (4,239) (6,774) OTHER FINANCING TRANSACTIONS — (5,878) NET CASH USED BY FINANCING ACTIVITIES (86,995) (142,766) EFFECT OF EXCHANGE RATE CHANGES ON CASH 768 2,306 INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 15,842 (7,476) CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD 85,072 92,548 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD $ 100,914 $ 85,072
- Moog Inc. Reports Third Quarter 2021 Results
Jul 30, 2021 · businesswire.com
EAST AURORA, N.Y.--(BUSINESS WIRE)--Moog Inc. (NYSE: MOG.A and MOG.B) announced today financial results for the quarter ended July 3, 2021. Third Quarter Highlights Sales of $707 million, up 8% from a year ago; GAAP diluted earnings per share of $1.12, up from ($0.39) a year ago; GAAP diluted earnings per share of $1.12 were up 20% over adjusted earnings per share of $0.93 a year ago; Operating margins of 9.2%; Effective tax rate of 25.7%; and $93 million cash flow from operating activities. Segment Results Aircraft Controls segment sales in the quarter were $272 million, up 9% year over year with higher commercial sales compensating for marginally lower military sales. Total commercial aircraft revenues were $96 million, 34% higher. Sales to commercial OEM customers increased 26% mostly tied to acquired sales from the recent Genesys acquisition. Commercial aftermarket sales were up 56%, to $28 million, the result of aircraft returning to service and repair and overhaul work on legacy components. Total military aircraft sales were down marginally, to $176 million. Military OEM sales of $128 million were 19% higher, helped by funded development and activity across a range of programs in the portfolio. Military aftermarket sales of $48 million decreased 31%, as our customers adjusted their inventory. Space and Defense segment sales were $205 million, up 11% year over year. Space sales of $86 million increased 16% on strength across the portfolio, led by integrated space vehicles and work on NASA programs. Defense sales were 8% higher, at $119 million, the result of increased sales of vehicle and naval applications and component products. Industrial Systems segment sales were $230 million, a 3% increase over last year. Sales of industrial automation products were up 19%, attributed to stronger capital spending globally. Medical product sales, including pumps and components for respirator products, were down 15% as sales moderated from the COVID-driven demand seen a year ago. Energy sales and sales into simulation and test applications were mostly unchanged. Consolidated 12-month backlog was $2.0 billion, up 21% from a year ago. “It was solid quarter for our business with strong cash flow and earnings per share in line with our projections,” said John Scannell, Chairman and CEO. “For the full year, we’re tweaking our sales outlook slightly and keeping our earnings per share forecast unchanged at $5.00, plus or minus $0.15. All in all, steady as she goes.” Fiscal 2021 Outlook The Company updated its fiscal 2021 projections of 90 days ago. Forecast sales of $2.82 billion; Forecast diluted earnings per share of $5.00, plus or minus $0.15; Forecast full year operating margins of 10.0%; Forecast effective tax rate of 24.2%; and Forecast cash flow from operations of $292 million. In conjunction with today’s release, Moog will host a conference call on Friday, July 30, 2021 beginning at 10:00 a.m. ET, which will be broadcast live over the Internet. John Scannell, Chairman and CEO, and Jennifer Walter, CFO, will host the call. Listeners can access the call live or in replay mode at www.moog.com/investors/communications. Supplemental financial data will be available on the webcast web page approximately 90 minutes prior to the conference call. About Moog Inc. Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, marine and medical equipment. Additional information about the company can be found at www.moog.com. Cautionary Statement Information included or incorporated by reference in this report that does not consist of historical facts, including statements accompanied by or containing words such as “may,” “will,” “should,” “believes,” “expects,” “expected,” “intends,” “plans,” “projects,” “approximate,” “estimates,” “predicts,” “potential,” “outlook,” “forecast,” “anticipates,” “presume” and “assume,” are forward-looking statements. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company’s current views with respect to certain current and future events and financial performance and are not guarantees of future performance. This includes but is not limited to, the Company’s expectation and ability to pay a quarterly cash dividend on its common stock in the future, subject to the determination by the board of directors, and based on an evaluation of company earnings, financial condition and requirements, business conditions, capital allocation determinations and other factors, risks and uncertainties. The impact or occurrence of these could cause actual results to differ materially from the expected results described in the forward-looking statements. These important factors, risks and uncertainties include: COVID-19 Pandemic Risks We face various risks related to health pandemics such as the global COVID-19 pandemic, which may have material adverse consequences on our operations, financial position, cash flows, and those of our customers and suppliers. Strategic Risks We operate in highly competitive markets with competitors who may have greater resources than we possess; Our new products and technology research and development efforts are substantial and may not be successful which could reduce our sales and earnings; Our inability to adequately enforce and protect our intellectual property or defend against assertions of infringement could prevent or restrict our ability to compete; and Our sales and earnings may be affected if we cannot identify, acquire or integrate strategic acquisitions, or as we conduct divestitures. Market Condition Risks The markets we serve are cyclical and sensitive to domestic and foreign economic conditions and events, which may cause our operating results to fluctuate; We depend heavily on government contracts that may not be fully funded or may be terminated, and the failure to receive funding or the termination of one or more of these contracts could reduce our sales and increase our costs; The loss of The Boeing Company as a customer or a significant reduction in sales to The Boeing Company could adversely impact our operating results; and We may not realize the full amounts reflected in our backlog as revenue, which could adversely affect our future revenue and growth prospects. Operational Risks Our business operations may be adversely affected by information systems interruptions, intrusions or new software implementations; We may not be able to prevent, or timely detect, issues with our products and our manufacturing processes which may adversely affect our operations and our earnings; If our subcontractors or suppliers fail to perform their contractual obligations, our prime contract performance and our ability to obtain future business could be materially and adversely impacted; and The failure or misuse of our products may damage our reputation, necessitate a product recall or result in claims against us that exceed our insurance coverage, thereby requiring us to pay significant damages. Financial Risks We make estimates in accounting for over-time contracts, and changes in these estimates may have significant impacts on our earnings; We enter into fixed-price contracts, which could subject us to losses if we have cost overruns; Our indebtedness and restrictive covenants under our credit facilities could limit our operational and financial flexibility; The phase out of LIBOR may negatively impact our debt agreements and financial position, results of operations and liquidity; Significant changes in discount rates, rates of return on pension assets, mortality tables and other factors could adversely affect our earnings and equity and increase our pension funding requirements; A write-off of all or part of our goodwill or other intangible assets could adversely affect our operating results and net worth; and Unforeseen exposure to additional income tax liabilities may affect our operating results. Legal and Compliance Risks Contracting on government programs is subject to significant regulation, including rules related to bidding, billing and accounting standards, and any false claims or non-compliance could subject us to fines, penalties or possible debarment; Our operations in foreign countries expose us to political and currency risks and adverse changes in local legal and regulatory environments; Government regulations could limit our ability to sell our products outside the United States and otherwise adversely affect our business; We are involved in various legal proceedings, the outcome of which may be unfavorable to us; and Our operations are subject to environmental laws, and complying with those laws may cause us to incur significant costs. General Risks The United Kingdom's decision to exit the European Union may result in short-term and long-term adverse impacts on our results of operations; Escalating tariffs, restrictions on imports or other trade barriers between the United States and various countries may impact our results of operations; Future terror attacks, war, natural disasters or other catastrophic events beyond our control could negatively impact our business; and Our performance could suffer if we cannot maintain our culture as well as attract, retain and engage our employees. These factors are not exhaustive. New factors, risks and uncertainties may emerge from time to time that may affect the forward-looking statements made herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. We disclaim any obligation to update the forward-looking statements made in this report. Moog Inc. CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) (UNAUDITED) (dollars in thousands, except per share data) Three Months Ended Nine Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Net sales $ 707,352 $ 657,539 $ 2,127,708 $ 2,177,659 Cost of sales 516,750 486,760 1,547,554 1,587,569 Inventory write-down — 18,795 — 18,795 Gross profit 190,602 151,984 580,154 571,295 Research and development 33,095 27,407 91,556 82,303 Selling, general and administrative 100,597 96,899 305,331 302,517 Interest 8,239 9,440 25,288 29,923 Long-lived asset impairment — 31,871 — 31,871 Restructuring — 5,306 — 5,306 Other 76 4,415 (3,115 ) 14,294 Earnings (loss) before income taxes 48,595 (23,354 ) 161,094 105,081 Income taxes (benefit) 12,473 (10,764 ) 38,442 17,899 Net earnings (loss) $ 36,122 $ (12,590 ) $ 122,652 $ 87,182 Net earnings (loss) per share Basic $ 1.12 $ (0.39 ) $ 3.82 $ 2.60 Diluted $ 1.12 $ (0.39 ) $ 3.80 $ 2.59 Average common shares outstanding Basic 32,125,524 32,601,481 32,115,400 33,515,584 Diluted 32,355,238 32,601,481 32,305,834 33,722,723 Results shown in the previous table include charges associated with the COVID-19 pandemic. These impacts include inventory write-down, long-lived asset impairment and restructuring charges. The table below adjusts the income taxes (benefit), net earnings (loss) and diluted net earnings (loss) per share to exclude these impacts. Reconciliation to non-GAAP adjusted income taxes (benefit), net earnings (loss) and diluted net earnings (loss) per share are as follows: Three Months Ended Nine Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 As Reported: Earnings (loss) before income taxes $ 48,595 $ (23,354 ) $ 161,094 $ 105,081 Income taxes (benefit) 12,473 (10,764 ) 38,442 17,899 Effective income tax rate 25.7 % 46.1 % 23.9 % 17.0 % Net earnings (loss) 36,122 (12,590 ) 122,652 87,182 Diluted net earnings (loss) per share $ 1.12 $ (0.39 ) $ 3.80 $ 2.59 COVID-19 Pandemic Charges: Earnings before income taxes $ — $ 55,972 $ — $ 55,972 Income taxes — 13,012 — 13,012 Net earnings — 42,960 — 42,960 Diluted net earnings per share $ — $ 1.32 $ — $ 1.32 As Adjusted: Earnings before income taxes $ 48,595 $ 32,618 $ 161,094 $ 161,053 Income taxes 12,473 2,248 38,442 30,911 Effective income tax rate 25.7 % 6.9 % 23.9 % 19.2 % Net earnings 36,122 30,370 122,652 130,142 Diluted net earnings per share $ 1.12 $ 0.93 $ 3.80 $ 3.91 The diluted net earnings per share associated with the charges have been calculated using the quarterly average outstanding shares in the period in which the charges were incurred. Moog Inc. CONSOLIDATED SALES AND OPERATING PROFIT (LOSS) (UNAUDITED) (dollars in thousands) Three Months Ended Nine Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Net sales: Aircraft Controls $ 272,131 $ 249,388 $ 863,266 $ 930,749 Space and Defense Controls 204,887 183,906 599,217 563,156 Industrial Systems 230,334 224,245 665,225 683,754 Net sales $ 707,352 $ 657,539 $ 2,127,708 $ 2,177,659 Operating profit (loss): Aircraft Controls $ 20,545 $ (42,053 ) $ 70,485 $ 31,240 7.5 % (16.9 )% 8.2 % 3.4 % Space and Defense Controls 21,339 22,290 71,037 72,224 10.4 % 12.1 % 11.9 % 12.8 % Industrial Systems 23,004 17,903 66,715 69,477 10.0 % 8.0 % 10.0 % 10.2 % Total operating profit (loss) 64,888 (1,860 ) 208,237 172,941 9.2 % (0.3 )% 9.8 % 7.9 % Deductions from operating profit: Interest expense 8,239 9,440 25,288 29,923 Equity-based compensation expense 1,791 1,390 6,420 4,661 Non-service pension expense (income) 928 4,241 (3,053 ) 11,440 Corporate and other expenses, net 5,335 6,423 18,488 21,836 Earnings (loss) before income taxes $ 48,595 $ (23,354 ) $ 161,094 $ 105,081 Operating Profit and Margins - as adjusted are as follows: Three Months Ended Nine Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Aircraft Controls operating profit (loss) - as reported $ 20,545 $ (42,053 ) $ 70,485 $ 31,240 Inventory write-down — 18,535 — 18,535 Long-lived asset impairment — 31,530 — 31,530 Restructuring — 2,896 — 2,896 Aircraft Controls operating profit - as adjusted $ 20,545 $ 10,908 $ 70,485 $ 84,201 7.5 % 4.4 % 8.2 % 9.0 % Space and Defense Controls operating profit - as reported $ 21,339 $ 22,290 $ 71,037 $ 72,224 Long-lived asset impairment — 341 — 341 Restructuring — 185 — 185 Space and Defense Controls operating profit - as adjusted $ 21,339 $ 22,816 $ 71,037 $ 72,750 10.4 % 12.4 % 11.9 % 12.9 % Industrial Systems operating profit - as reported $ 23,004 $ 17,903 $ 66,715 $ 69,477 Inventory write-down — 260 — 260 Restructuring — 2,225 — 2,225 Industrial Systems operating profit - as adjusted $ 23,004 $ 20,388 $ 66,715 $ 71,962 10.0 % 9.1 % 10.0 % 10.5 % Total operating profit - as adjusted $ 64,888 $ 54,112 $ 208,237 $ 228,913 9.2 % 8.2 % 9.8 % 10.5 % Moog Inc. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (dollars in thousands) July 3, 2021 October 3, 2020 ASSETS Current assets Cash and cash equivalents $ 90,550 $ 84,583 Restricted cash 1,108 489 Receivables, net 896,998 855,535 Inventories, net 632,359 623,043 Prepaid expenses and other current assets 49,513 49,837 Total current assets 1,670,528 1,613,487 Property, plant and equipment, net 639,202 600,498 Operating lease right-of-use assets 62,507 68,393 Goodwill 860,268 821,856 Intangible assets, net 111,867 85,046 Deferred income taxes 18,467 18,924 Other assets 20,471 17,627 Total assets $ 3,383,310 $ 3,225,831 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Current installments of long-term debt $ 56,062 $ 350 Accounts payable 162,890 176,868 Accrued compensation 111,159 109,510 Contract advances 259,425 203,338 Accrued liabilities and other 216,625 220,488 Total current liabilities 806,161 710,554 Long-term debt, excluding current installments 863,682 929,982 Long-term pension and retirement obligations 181,400 183,366 Deferred income taxes 54,168 40,474 Other long-term liabilities 110,694 118,372 Total liabilities 2,016,105 1,982,748 Shareholders’ equity Common stock - Class A 43,802 43,799 Common stock - Class B 7,478 7,481 Additional paid-in capital 519,636 472,645 Retained earnings 2,211,305 2,112,734 Treasury shares (1,007,754) (990,783) Stock Employee Compensation Trust (85,314) (64,242) Supplemental Retirement Plan Trust (69,448) (53,098) Accumulated other comprehensive loss (252,500) (285,453) Total shareholders’ equity 1,367,205 1,243,083 Total liabilities and shareholders’ equity $ 3,383,310 $ 3,225,831 Moog Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (dollars in thousands) Nine Months Ended July 3, 2021 June 27, 2020 CASH FLOWS FROM OPERATING ACTIVITIES Net earnings $ 122,652 $ 87,182 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 56,806 55,859 Amortization 10,000 9,847 Deferred income taxes 4,161 (10,766 ) Equity-based compensation expense 6,420 4,661 Impairment of long-lived assets and inventory write-down — 50,666 Other (2,781 ) 6,831 Changes in assets and liabilities providing (using) cash: Receivables (21,329 ) 63,272 Inventories 9,509 (86,050 ) Accounts payable (17,530 ) (85,136 ) Contract advances 54,414 73,040 Accrued expenses 3,503 1,827 Accrued income taxes 14,776 (20,555 ) Net pension and post retirement liabilities 8,380 24,706 Other assets and liabilities (18,401 ) 12,463 Net cash provided by operating activities 230,580 187,847 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of businesses, net of cash acquired (77,600 ) (54,265 ) Purchase of property, plant and equipment (88,573 ) (70,423 ) Other investing transactions 3,615 (3,429 ) Net cash used by investing activities (162,558 ) (128,117 ) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from revolving lines of credit 653,500 977,850 Payments on revolving lines of credit (651,986 ) (968,459 ) Proceeds from long-term debt 42,300 6,935 Payments on long-term debt (55,891 ) (52,253 ) Proceeds from senior notes, net of issuance costs — 491,769 Payments on senior notes — (300,000 ) Payments on finance lease obligations (1,588 ) (730 ) Payment of dividends (24,081 ) (17,049 ) Proceeds from sale of treasury stock 4,603 3,199 Purchase of outstanding shares for treasury (26,702 ) (191,961 ) Proceeds from sale of stock held by SECT 679 17,082 Purchase of stock held by SECT (3,535 ) (6,241 ) Other financing transactions — (5,879 ) Net cash used by financing activities (62,701 ) (45,737 ) Effect of exchange rate changes on cash 1,265 (932 ) Increase in cash, cash equivalents and restricted cash 6,586 13,061 Cash, cash equivalents and restricted cash at beginning of period 85,072 92,548 Cash, cash equivalents and restricted cash at end of period $ 91,658 $ 105,609
- MOOG INC. REPORTS THIRD QUARTER 2021 RESULTS
Jul 30, 2021
EAST AURORA, N.Y.--(BUSINESS WIRE)--MOOG INC. (NYSE: MOG.A AND MOG.B) ANNOUNCED TODAY FINANCIAL RESULTS FOR THE QUARTER ENDED JULY 3, 2021. THIRD QUARTER HIGHLIGHTS SALES OF $707 MILLION, UP 8% FROM A YEAR AGO; GAAP DILUTED EARNINGS PER SHARE OF $1.12, UP FROM ($0.39) A YEAR AGO; GAAP DILUTED EARNINGS PER SHARE OF $1.12 WERE UP 20% OVER ADJUSTED EARNINGS PER SHARE OF $0.93 A YEAR AGO; OPERATING MARGINS OF 9.2%; EFFECTIVE TAX RATE OF 25.7%; AND $93 MILLION CASH FLOW FROM OPERATING ACTIVITIES. SEGMENT RESULTS AIRCRAFT CONTROLS SEGMENT SALES IN THE QUARTER WERE $272 MILLION, UP 9% YEAR OVER YEAR WITH HIGHER COMMERCIAL SALES COMPENSATING FOR MARGINALLY LOWER MILITARY SALES. TOTAL COMMERCIAL AIRCRAFT REVENUES WERE $96 MILLION, 34% HIGHER. SALES TO COMMERCIAL OEM CUSTOMERS INCREASED 26% MOSTLY TIED TO ACQUIRED SALES FROM THE RECENT GENESYS ACQUISITION. COMMERCIAL AFTERMARKET SALES WERE UP 56%, TO $28 MILLION, THE RESULT OF AIRCRAFT RETURNING TO SERVICE AND REPAIR AND OVERHAUL WORK ON LEGACY COMPONENTS. TOTAL MILITARY AIRCRAFT SALES WERE DOWN MARGINALLY, TO $176 MILLION. MILITARY OEM SALES OF $128 MILLION WERE 19% HIGHER, HELPED BY FUNDED DEVELOPMENT AND ACTIVITY ACROSS A RANGE OF PROGRAMS IN THE PORTFOLIO. MILITARY AFTERMARKET SALES OF $48 MILLION DECREASED 31%, AS OUR CUSTOMERS ADJUSTED THEIR INVENTORY. SPACE AND DEFENSE SEGMENT SALES WERE $205 MILLION, UP 11% YEAR OVER YEAR. SPACE SALES OF $86 MILLION INCREASED 16% ON STRENGTH ACROSS THE PORTFOLIO, LED BY INTEGRATED SPACE VEHICLES AND WORK ON NASA PROGRAMS. DEFENSE SALES WERE 8% HIGHER, AT $119 MILLION, THE RESULT OF INCREASED SALES OF VEHICLE AND NAVAL APPLICATIONS AND COMPONENT PRODUCTS. INDUSTRIAL SYSTEMS SEGMENT SALES WERE $230 MILLION, A 3% INCREASE OVER LAST YEAR. SALES OF INDUSTRIAL AUTOMATION PRODUCTS WERE UP 19%, ATTRIBUTED TO STRONGER CAPITAL SPENDING GLOBALLY. MEDICAL PRODUCT SALES, INCLUDING PUMPS AND COMPONENTS FOR RESPIRATOR PRODUCTS, WERE DOWN 15% AS SALES MODERATED FROM THE COVID-DRIVEN DEMAND SEEN A YEAR AGO. ENERGY SALES AND SALES INTO SIMULATION AND TEST APPLICATIONS WERE MOSTLY UNCHANGED. CONSOLIDATED 12-MONTH BACKLOG WAS $2.0 BILLION, UP 21% FROM A YEAR AGO. “IT WAS SOLID QUARTER FOR OUR BUSINESS WITH STRONG CASH FLOW AND EARNINGS PER SHARE IN LINE WITH OUR PROJECTIONS,” SAID JOHN SCANNELL, CHAIRMAN AND CEO. “FOR THE FULL YEAR, WE’RE TWEAKING OUR SALES OUTLOOK SLIGHTLY AND KEEPING OUR EARNINGS PER SHARE FORECAST UNCHANGED AT $5.00, PLUS OR MINUS $0.15. ALL IN ALL, STEADY AS SHE GOES.” FISCAL 2021 OUTLOOK THE COMPANY UPDATED ITS FISCAL 2021 PROJECTIONS OF 90 DAYS AGO. FORECAST SALES OF $2.82 BILLION; FORECAST DILUTED EARNINGS PER SHARE OF $5.00, PLUS OR MINUS $0.15; FORECAST FULL YEAR OPERATING MARGINS OF 10.0%; FORECAST EFFECTIVE TAX RATE OF 24.2%; AND FORECAST CASH FLOW FROM OPERATIONS OF $292 MILLION. IN CONJUNCTION WITH TODAY’S RELEASE, MOOG WILL HOST A CONFERENCE CALL ON FRIDAY, JULY 30, 2021 BEGINNING AT 10:00 A.M. ET, WHICH WILL BE BROADCAST LIVE OVER THE INTERNET. JOHN SCANNELL, CHAIRMAN AND CEO, AND JENNIFER WALTER, CFO, WILL HOST THE CALL. LISTENERS CAN ACCESS THE CALL LIVE OR IN REPLAY MODE AT WWW.MOOG.COM/INVESTORS/COMMUNICATIONS. SUPPLEMENTAL FINANCIAL DATA WILL BE AVAILABLE ON THE WEBCAST WEB PAGE APPROXIMATELY 90 MINUTES PRIOR TO THE CONFERENCE CALL. ABOUT MOOG INC. MOOG INC. IS A WORLDWIDE DESIGNER, MANUFACTURER, AND INTEGRATOR OF PRECISION CONTROL COMPONENTS AND SYSTEMS. MOOG’S HIGH-PERFORMANCE SYSTEMS CONTROL MILITARY AND COMMERCIAL AIRCRAFT, SATELLITES AND SPACE VEHICLES, LAUNCH VEHICLES, MISSILES, AUTOMATED INDUSTRIAL MACHINERY, MARINE AND MEDICAL EQUIPMENT. ADDITIONAL INFORMATION ABOUT THE COMPANY CAN BE FOUND AT WWW.MOOG.COM. CAUTIONARY STATEMENT INFORMATION INCLUDED OR INCORPORATED BY REFERENCE IN THIS REPORT THAT DOES NOT CONSIST OF HISTORICAL FACTS, INCLUDING STATEMENTS ACCOMPANIED BY OR CONTAINING WORDS SUCH AS “MAY,” “WILL,” “SHOULD,” “BELIEVES,” “EXPECTS,” “EXPECTED,” “INTENDS,” “PLANS,” “PROJECTS,” “APPROXIMATE,” “ESTIMATES,” “PREDICTS,” “POTENTIAL,” “OUTLOOK,” “FORECAST,” “ANTICIPATES,” “PRESUME” AND “ASSUME,” ARE FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THESE FORWARD-LOOKING STATEMENTS REFLECT THE COMPANY’S CURRENT VIEWS WITH RESPECT TO CERTAIN CURRENT AND FUTURE EVENTS AND FINANCIAL PERFORMANCE AND ARE NOT GUARANTEES OF FUTURE PERFORMANCE. THIS INCLUDES BUT IS NOT LIMITED TO, THE COMPANY’S EXPECTATION AND ABILITY TO PAY A QUARTERLY CASH DIVIDEND ON ITS COMMON STOCK IN THE FUTURE, SUBJECT TO THE DETERMINATION BY THE BOARD OF DIRECTORS, AND BASED ON AN EVALUATION OF COMPANY EARNINGS, FINANCIAL CONDITION AND REQUIREMENTS, BUSINESS CONDITIONS, CAPITAL ALLOCATION DETERMINATIONS AND OTHER FACTORS, RISKS AND UNCERTAINTIES. THE IMPACT OR OCCURRENCE OF THESE COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE EXPECTED RESULTS DESCRIBED IN THE FORWARD-LOOKING STATEMENTS. THESE IMPORTANT FACTORS, RISKS AND UNCERTAINTIES INCLUDE: COVID-19 PANDEMIC RISKS WE FACE VARIOUS RISKS RELATED TO HEALTH PANDEMICS SUCH AS THE GLOBAL COVID-19 PANDEMIC, WHICH MAY HAVE MATERIAL ADVERSE CONSEQUENCES ON OUR OPERATIONS, FINANCIAL POSITION, CASH FLOWS, AND THOSE OF OUR CUSTOMERS AND SUPPLIERS. STRATEGIC RISKS WE OPERATE IN HIGHLY COMPETITIVE MARKETS WITH COMPETITORS WHO MAY HAVE GREATER RESOURCES THAN WE POSSESS; OUR NEW PRODUCTS AND TECHNOLOGY RESEARCH AND DEVELOPMENT EFFORTS ARE SUBSTANTIAL AND MAY NOT BE SUCCESSFUL WHICH COULD REDUCE OUR SALES AND EARNINGS; OUR INABILITY TO ADEQUATELY ENFORCE AND PROTECT OUR INTELLECTUAL PROPERTY OR DEFEND AGAINST ASSERTIONS OF INFRINGEMENT COULD PREVENT OR RESTRICT OUR ABILITY TO COMPETE; AND OUR SALES AND EARNINGS MAY BE AFFECTED IF WE CANNOT IDENTIFY, ACQUIRE OR INTEGRATE STRATEGIC ACQUISITIONS, OR AS WE CONDUCT DIVESTITURES. MARKET CONDITION RISKS THE MARKETS WE SERVE ARE CYCLICAL AND SENSITIVE TO DOMESTIC AND FOREIGN ECONOMIC CONDITIONS AND EVENTS, WHICH MAY CAUSE OUR OPERATING RESULTS TO FLUCTUATE; WE DEPEND HEAVILY ON GOVERNMENT CONTRACTS THAT MAY NOT BE FULLY FUNDED OR MAY BE TERMINATED, AND THE FAILURE TO RECEIVE FUNDING OR THE TERMINATION OF ONE OR MORE OF THESE CONTRACTS COULD REDUCE OUR SALES AND INCREASE OUR COSTS; THE LOSS OF THE BOEING COMPANY AS A CUSTOMER OR A SIGNIFICANT REDUCTION IN SALES TO THE BOEING COMPANY COULD ADVERSELY IMPACT OUR OPERATING RESULTS; AND WE MAY NOT REALIZE THE FULL AMOUNTS REFLECTED IN OUR BACKLOG AS REVENUE, WHICH COULD ADVERSELY AFFECT OUR FUTURE REVENUE AND GROWTH PROSPECTS. OPERATIONAL RISKS OUR BUSINESS OPERATIONS MAY BE ADVERSELY AFFECTED BY INFORMATION SYSTEMS INTERRUPTIONS, INTRUSIONS OR NEW SOFTWARE IMPLEMENTATIONS; WE MAY NOT BE ABLE TO PREVENT, OR TIMELY DETECT, ISSUES WITH OUR PRODUCTS AND OUR MANUFACTURING PROCESSES WHICH MAY ADVERSELY AFFECT OUR OPERATIONS AND OUR EARNINGS; IF OUR SUBCONTRACTORS OR SUPPLIERS FAIL TO PERFORM THEIR CONTRACTUAL OBLIGATIONS, OUR PRIME CONTRACT PERFORMANCE AND OUR ABILITY TO OBTAIN FUTURE BUSINESS COULD BE MATERIALLY AND ADVERSELY IMPACTED; AND THE FAILURE OR MISUSE OF OUR PRODUCTS MAY DAMAGE OUR REPUTATION, NECESSITATE A PRODUCT RECALL OR RESULT IN CLAIMS AGAINST US THAT EXCEED OUR INSURANCE COVERAGE, THEREBY REQUIRING US TO PAY SIGNIFICANT DAMAGES. FINANCIAL RISKS WE MAKE ESTIMATES IN ACCOUNTING FOR OVER-TIME CONTRACTS, AND CHANGES IN THESE ESTIMATES MAY HAVE SIGNIFICANT IMPACTS ON OUR EARNINGS; WE ENTER INTO FIXED-PRICE CONTRACTS, WHICH COULD SUBJECT US TO LOSSES IF WE HAVE COST OVERRUNS; OUR INDEBTEDNESS AND RESTRICTIVE COVENANTS UNDER OUR CREDIT FACILITIES COULD LIMIT OUR OPERATIONAL AND FINANCIAL FLEXIBILITY; THE PHASE OUT OF LIBOR MAY NEGATIVELY IMPACT OUR DEBT AGREEMENTS AND FINANCIAL POSITION, RESULTS OF OPERATIONS AND LIQUIDITY; SIGNIFICANT CHANGES IN DISCOUNT RATES, RATES OF RETURN ON PENSION ASSETS, MORTALITY TABLES AND OTHER FACTORS COULD ADVERSELY AFFECT OUR EARNINGS AND EQUITY AND INCREASE OUR PENSION FUNDING REQUIREMENTS; A WRITE-OFF OF ALL OR PART OF OUR GOODWILL OR OTHER INTANGIBLE ASSETS COULD ADVERSELY AFFECT OUR OPERATING RESULTS AND NET WORTH; AND UNFORESEEN EXPOSURE TO ADDITIONAL INCOME TAX LIABILITIES MAY AFFECT OUR OPERATING RESULTS. LEGAL AND COMPLIANCE RISKS CONTRACTING ON GOVERNMENT PROGRAMS IS SUBJECT TO SIGNIFICANT REGULATION, INCLUDING RULES RELATED TO BIDDING, BILLING AND ACCOUNTING STANDARDS, AND ANY FALSE CLAIMS OR NON-COMPLIANCE COULD SUBJECT US TO FINES, PENALTIES OR POSSIBLE DEBARMENT; OUR OPERATIONS IN FOREIGN COUNTRIES EXPOSE US TO POLITICAL AND CURRENCY RISKS AND ADVERSE CHANGES IN LOCAL LEGAL AND REGULATORY ENVIRONMENTS; GOVERNMENT REGULATIONS COULD LIMIT OUR ABILITY TO SELL OUR PRODUCTS OUTSIDE THE UNITED STATES AND OTHERWISE ADVERSELY AFFECT OUR BUSINESS; WE ARE INVOLVED IN VARIOUS LEGAL PROCEEDINGS, THE OUTCOME OF WHICH MAY BE UNFAVORABLE TO US; AND OUR OPERATIONS ARE SUBJECT TO ENVIRONMENTAL LAWS, AND COMPLYING WITH THOSE LAWS MAY CAUSE US TO INCUR SIGNIFICANT COSTS. GENERAL RISKS THE UNITED KINGDOM'S DECISION TO EXIT THE EUROPEAN UNION MAY RESULT IN SHORT-TERM AND LONG-TERM ADVERSE IMPACTS ON OUR RESULTS OF OPERATIONS; ESCALATING TARIFFS, RESTRICTIONS ON IMPORTS OR OTHER TRADE BARRIERS BETWEEN THE UNITED STATES AND VARIOUS COUNTRIES MAY IMPACT OUR RESULTS OF OPERATIONS; FUTURE TERROR ATTACKS, WAR, NATURAL DISASTERS OR OTHER CATASTROPHIC EVENTS BEYOND OUR CONTROL COULD NEGATIVELY IMPACT OUR BUSINESS; AND OUR PERFORMANCE COULD SUFFER IF WE CANNOT MAINTAIN OUR CULTURE AS WELL AS ATTRACT, RETAIN AND ENGAGE OUR EMPLOYEES. THESE FACTORS ARE NOT EXHAUSTIVE. NEW FACTORS, RISKS AND UNCERTAINTIES MAY EMERGE FROM TIME TO TIME THAT MAY AFFECT THE FORWARD-LOOKING STATEMENTS MADE HEREIN. GIVEN THESE FACTORS, RISKS AND UNCERTAINTIES, INVESTORS SHOULD NOT PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS AS PREDICTIVE OF FUTURE RESULTS. WE DISCLAIM ANY OBLIGATION TO UPDATE THE FORWARD-LOOKING STATEMENTS MADE IN THIS REPORT. MOOG INC. CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) THREE MONTHS ENDED NINE MONTHS ENDED JULY 3, 2021 JUNE 27, 2020 JULY 3, 2021 JUNE 27, 2020 NET SALES $ 707,352 $ 657,539 $ 2,127,708 $ 2,177,659 COST OF SALES 516,750 486,760 1,547,554 1,587,569 INVENTORY WRITE-DOWN — 18,795 — 18,795 GROSS PROFIT 190,602 151,984 580,154 571,295 RESEARCH AND DEVELOPMENT 33,095 27,407 91,556 82,303 SELLING, GENERAL AND ADMINISTRATIVE 100,597 96,899 305,331 302,517 INTEREST 8,239 9,440 25,288 29,923 LONG-LIVED ASSET IMPAIRMENT — 31,871 — 31,871 RESTRUCTURING — 5,306 — 5,306 OTHER 76 4,415 (3,115 ) 14,294 EARNINGS (LOSS) BEFORE INCOME TAXES 48,595 (23,354 ) 161,094 105,081 INCOME TAXES (BENEFIT) 12,473 (10,764 ) 38,442 17,899 NET EARNINGS (LOSS) $ 36,122 $ (12,590 ) $ 122,652 $ 87,182 NET EARNINGS (LOSS) PER SHARE BASIC $ 1.12 $ (0.39 ) $ 3.82 $ 2.60 DILUTED $ 1.12 $ (0.39 ) $ 3.80 $ 2.59 AVERAGE COMMON SHARES OUTSTANDING BASIC 32,125,524 32,601,481 32,115,400 33,515,584 DILUTED 32,355,238 32,601,481 32,305,834 33,722,723 RESULTS SHOWN IN THE PREVIOUS TABLE INCLUDE CHARGES ASSOCIATED WITH THE COVID-19 PANDEMIC. THESE IMPACTS INCLUDE INVENTORY WRITE-DOWN, LONG-LIVED ASSET IMPAIRMENT AND RESTRUCTURING CHARGES. THE TABLE BELOW ADJUSTS THE INCOME TAXES (BENEFIT), NET EARNINGS (LOSS) AND DILUTED NET EARNINGS (LOSS) PER SHARE TO EXCLUDE THESE IMPACTS. RECONCILIATION TO NON-GAAP ADJUSTED INCOME TAXES (BENEFIT), NET EARNINGS (LOSS) AND DILUTED NET EARNINGS (LOSS) PER SHARE ARE AS FOLLOWS: THREE MONTHS ENDED NINE MONTHS ENDED JULY 3, 2021 JUNE 27, 2020 JULY 3, 2021 JUNE 27, 2020 AS REPORTED: EARNINGS (LOSS) BEFORE INCOME TAXES $ 48,595 $ (23,354 ) $ 161,094 $ 105,081 INCOME TAXES (BENEFIT) 12,473 (10,764 ) 38,442 17,899 EFFECTIVE INCOME TAX RATE 25.7 % 46.1 % 23.9 % 17.0 % NET EARNINGS (LOSS) 36,122 (12,590 ) 122,652 87,182 DILUTED NET EARNINGS (LOSS) PER SHARE $ 1.12 $ (0.39 ) $ 3.80 $ 2.59 COVID-19 PANDEMIC CHARGES: EARNINGS BEFORE INCOME TAXES $ — $ 55,972 $ — $ 55,972 INCOME TAXES — 13,012 — 13,012 NET EARNINGS — 42,960 — 42,960 DILUTED NET EARNINGS PER SHARE $ — $ 1.32 $ — $ 1.32 AS ADJUSTED: EARNINGS BEFORE INCOME TAXES $ 48,595 $ 32,618 $ 161,094 $ 161,053 INCOME TAXES 12,473 2,248 38,442 30,911 EFFECTIVE INCOME TAX RATE 25.7 % 6.9 % 23.9 % 19.2 % NET EARNINGS 36,122 30,370 122,652 130,142 DILUTED NET EARNINGS PER SHARE $ 1.12 $ 0.93 $ 3.80 $ 3.91 THE DILUTED NET EARNINGS PER SHARE ASSOCIATED WITH THE CHARGES HAVE BEEN CALCULATED USING THE QUARTERLY AVERAGE OUTSTANDING SHARES IN THE PERIOD IN WHICH THE CHARGES WERE INCURRED. MOOG INC. CONSOLIDATED SALES AND OPERATING PROFIT (LOSS) (UNAUDITED) (DOLLARS IN THOUSANDS) THREE MONTHS ENDED NINE MONTHS ENDED JULY 3, 2021 JUNE 27, 2020 JULY 3, 2021 JUNE 27, 2020 NET SALES: AIRCRAFT CONTROLS $ 272,131 $ 249,388 $ 863,266 $ 930,749 SPACE AND DEFENSE CONTROLS 204,887 183,906 599,217 563,156 INDUSTRIAL SYSTEMS 230,334 224,245 665,225 683,754 NET SALES $ 707,352 $ 657,539 $ 2,127,708 $ 2,177,659 OPERATING PROFIT (LOSS): AIRCRAFT CONTROLS $ 20,545 $ (42,053 ) $ 70,485 $ 31,240 7.5 % (16.9 )% 8.2 % 3.4 % SPACE AND DEFENSE CONTROLS 21,339 22,290 71,037 72,224 10.4 % 12.1 % 11.9 % 12.8 % INDUSTRIAL SYSTEMS 23,004 17,903 66,715 69,477 10.0 % 8.0 % 10.0 % 10.2 % TOTAL OPERATING PROFIT (LOSS) 64,888 (1,860 ) 208,237 172,941 9.2 % (0.3 )% 9.8 % 7.9 % DEDUCTIONS FROM OPERATING PROFIT: INTEREST EXPENSE 8,239 9,440 25,288 29,923 EQUITY-BASED COMPENSATION EXPENSE 1,791 1,390 6,420 4,661 NON-SERVICE PENSION EXPENSE (INCOME) 928 4,241 (3,053 ) 11,440 CORPORATE AND OTHER EXPENSES, NET 5,335 6,423 18,488 21,836 EARNINGS (LOSS) BEFORE INCOME TAXES $ 48,595 $ (23,354 ) $ 161,094 $ 105,081 OPERATING PROFIT AND MARGINS - AS ADJUSTED ARE AS FOLLOWS: THREE MONTHS ENDED NINE MONTHS ENDED JULY 3, 2021 JUNE 27, 2020 JULY 3, 2021 JUNE 27, 2020 AIRCRAFT CONTROLS OPERATING PROFIT (LOSS) - AS REPORTED $ 20,545 $ (42,053 ) $ 70,485 $ 31,240 INVENTORY WRITE-DOWN — 18,535 — 18,535 LONG-LIVED ASSET IMPAIRMENT — 31,530 — 31,530 RESTRUCTURING — 2,896 — 2,896 AIRCRAFT CONTROLS OPERATING PROFIT - AS ADJUSTED $ 20,545 $ 10,908 $ 70,485 $ 84,201 7.5 % 4.4 % 8.2 % 9.0 % SPACE AND DEFENSE CONTROLS OPERATING PROFIT - AS REPORTED $ 21,339 $ 22,290 $ 71,037 $ 72,224 LONG-LIVED ASSET IMPAIRMENT — 341 — 341 RESTRUCTURING — 185 — 185 SPACE AND DEFENSE CONTROLS OPERATING PROFIT - AS ADJUSTED $ 21,339 $ 22,816 $ 71,037 $ 72,750 10.4 % 12.4 % 11.9 % 12.9 % INDUSTRIAL SYSTEMS OPERATING PROFIT - AS REPORTED $ 23,004 $ 17,903 $ 66,715 $ 69,477 INVENTORY WRITE-DOWN — 260 — 260 RESTRUCTURING — 2,225 — 2,225 INDUSTRIAL SYSTEMS OPERATING PROFIT - AS ADJUSTED $ 23,004 $ 20,388 $ 66,715 $ 71,962 10.0 % 9.1 % 10.0 % 10.5 % TOTAL OPERATING PROFIT - AS ADJUSTED $ 64,888 $ 54,112 $ 208,237 $ 228,913 9.2 % 8.2 % 9.8 % 10.5 % MOOG INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (DOLLARS IN THOUSANDS) JULY 3, 2021 OCTOBER 3, 2020 ASSETS CURRENT ASSETS CASH AND CASH EQUIVALENTS $ 90,550 $ 84,583 RESTRICTED CASH 1,108 489 RECEIVABLES, NET 896,998 855,535 INVENTORIES, NET 632,359 623,043 PREPAID EXPENSES AND OTHER CURRENT ASSETS 49,513 49,837 TOTAL CURRENT ASSETS 1,670,528 1,613,487 PROPERTY, PLANT AND EQUIPMENT, NET 639,202 600,498 OPERATING LEASE RIGHT-OF-USE ASSETS 62,507 68,393 GOODWILL 860,268 821,856 INTANGIBLE ASSETS, NET 111,867 85,046 DEFERRED INCOME TAXES 18,467 18,924 OTHER ASSETS 20,471 17,627 TOTAL ASSETS $ 3,383,310 $ 3,225,831 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES CURRENT INSTALLMENTS OF LONG-TERM DEBT $ 56,062 $ 350 ACCOUNTS PAYABLE 162,890 176,868 ACCRUED COMPENSATION 111,159 109,510 CONTRACT ADVANCES 259,425 203,338 ACCRUED LIABILITIES AND OTHER 216,625 220,488 TOTAL CURRENT LIABILITIES 806,161 710,554 LONG-TERM DEBT, EXCLUDING CURRENT INSTALLMENTS 863,682 929,982 LONG-TERM PENSION AND RETIREMENT OBLIGATIONS 181,400 183,366 DEFERRED INCOME TAXES 54,168 40,474 OTHER LONG-TERM LIABILITIES 110,694 118,372 TOTAL LIABILITIES 2,016,105 1,982,748 SHAREHOLDERS’ EQUITY COMMON STOCK - CLASS A 43,802 43,799 COMMON STOCK - CLASS B 7,478 7,481 ADDITIONAL PAID-IN CAPITAL 519,636 472,645 RETAINED EARNINGS 2,211,305 2,112,734 TREASURY SHARES (1,007,754) (990,783) STOCK EMPLOYEE COMPENSATION TRUST (85,314) (64,242) SUPPLEMENTAL RETIREMENT PLAN TRUST (69,448) (53,098) ACCUMULATED OTHER COMPREHENSIVE LOSS (252,500) (285,453) TOTAL SHAREHOLDERS’ EQUITY 1,367,205 1,243,083 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 3,383,310 $ 3,225,831 MOOG INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (DOLLARS IN THOUSANDS) NINE MONTHS ENDED JULY 3, 2021 JUNE 27, 2020 CASH FLOWS FROM OPERATING ACTIVITIES NET EARNINGS $ 122,652 $ 87,182 ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH PROVIDED BY OPERATING ACTIVITIES: DEPRECIATION 56,806 55,859 AMORTIZATION 10,000 9,847 DEFERRED INCOME TAXES 4,161 (10,766 ) EQUITY-BASED COMPENSATION EXPENSE 6,420 4,661 IMPAIRMENT OF LONG-LIVED ASSETS AND INVENTORY WRITE-DOWN — 50,666 OTHER (2,781 ) 6,831 CHANGES IN ASSETS AND LIABILITIES PROVIDING (USING) CASH: RECEIVABLES (21,329 ) 63,272 INVENTORIES 9,509 (86,050 ) ACCOUNTS PAYABLE (17,530 ) (85,136 ) CONTRACT ADVANCES 54,414 73,040 ACCRUED EXPENSES 3,503 1,827 ACCRUED INCOME TAXES 14,776 (20,555 ) NET PENSION AND POST RETIREMENT LIABILITIES 8,380 24,706 OTHER ASSETS AND LIABILITIES (18,401 ) 12,463 NET CASH PROVIDED BY OPERATING ACTIVITIES 230,580 187,847 CASH FLOWS FROM INVESTING ACTIVITIES ACQUISITIONS OF BUSINESSES, NET OF CASH ACQUIRED (77,600 ) (54,265 ) PURCHASE OF PROPERTY, PLANT AND EQUIPMENT (88,573 ) (70,423 ) OTHER INVESTING TRANSACTIONS 3,615 (3,429 ) NET CASH USED BY INVESTING ACTIVITIES (162,558 ) (128,117 ) CASH FLOWS FROM FINANCING ACTIVITIES PROCEEDS FROM REVOLVING LINES OF CREDIT 653,500 977,850 PAYMENTS ON REVOLVING LINES OF CREDIT (651,986 ) (968,459 ) PROCEEDS FROM LONG-TERM DEBT 42,300 6,935 PAYMENTS ON LONG-TERM DEBT (55,891 ) (52,253 ) PROCEEDS FROM SENIOR NOTES, NET OF ISSUANCE COSTS — 491,769 PAYMENTS ON SENIOR NOTES — (300,000 ) PAYMENTS ON FINANCE LEASE OBLIGATIONS (1,588 ) (730 ) PAYMENT OF DIVIDENDS (24,081 ) (17,049 ) PROCEEDS FROM SALE OF TREASURY STOCK 4,603 3,199 PURCHASE OF OUTSTANDING SHARES FOR TREASURY (26,702 ) (191,961 ) PROCEEDS FROM SALE OF STOCK HELD BY SECT 679 17,082 PURCHASE OF STOCK HELD BY SECT (3,535 ) (6,241 ) OTHER FINANCING TRANSACTIONS — (5,879 ) NET CASH USED BY FINANCING ACTIVITIES (62,701 ) (45,737 ) EFFECT OF EXCHANGE RATE CHANGES ON CASH 1,265 (932 ) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 6,586 13,061 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD 85,072 92,548 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD $ 91,658 $ 105,609
