Ducommun Inc (NYSE:DCO) Q3 2018 Earnings Conference Call Transcript
Nov 05, 2018 • 01:00 am ET
Good day, ladies and gentlemen, and welcome to the Ducommun Third Quarter Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder, this call is being recorded.
And I'd like to introduce your host for today's conference, Chris Witty, moderator. Sir, you may begin
Thank you, and welcome to Ducommun's 2018 Third Quarter Conference Call. With me today are Steve Oswald, Chairman, President and CEO; and Doug Groves, VP, CFO and Treasurer.
(Forward-Looking Cautionary Statements)
Statements made during this call are only as of the time made, and we do not intend to update any statements made in this presentation except if and as required by regulatory authorities. In addition, all comparisons on today's call recognize the implementation of the FASB Accounting Standards Codification, or ASC Topic 606, covering revenue recognition policies on current results. Please see the company's filings for further description of this change and a comparison to the prior policy, ASC 605.
This call also includes non-GAAP financial measures. Please refer to our filings with the SEC for a reconciliation of non-GAAP measures referenced on this call to the most similar GAAP measures. We filed our Form 10-Q with the SEC today, and you'll find a link to all our filings on the company's website under the Investor Relations tab.
I would now like to turn the call over to Mr. Steve Oswald for a review of the operating results. Steve?
Thanks, Chris, and thank you, everyone, for joining us today for our 2018 third quarter conference call. As usual, I'll begin by providing an overview of recent developments of the company, after which Doug will review our financial results in detail.
As with the second quarter in 2018, the third quarter again demonstrated the ongoing benefits of many actions we've taken over the past 18 months to improve Ducommun's growth trajectory and overall financial results. Effective restructuring strategy, record backlogs, new program wins and a leaner, more efficient organization is now starting to be realized in our financial performance.
Revenue rose 15.3% year-over-year to $159.8 million. The double-digit growth reflects the continued strength across a number of programs, both commercial and defense-related, which Ducommun is benefiting from a significant shipset amount per platform and rising bill rates. The company is also known as a lead provider of advanced structural and electronic components for many large, narrow-body aircraft, and our share gains to this market is growing quarter-by-quarter.
At the same time, we recently announced a $200 million long-term contract producing nacelle components using our new proprietary VersaCore Composite technology for a leading engine OEM. While we cannot name the customer for competitive reasons, the contract, which runs through 2029, is an excellent example of the company leveraging its manufacturing expertise, proprietary materials along with process technology and composites. Ducommun will complete the nacelle product design in 2019 and then begin full production in 2020. For background,