Curtiss-Wright Corporation (NYSE:CW) Q2 2019 Earnings Conference Call Transcript

Aug 01, 2019 • 09:00 am ET

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Curtiss-Wright Corporation (NYSE:CW) Q2 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Curtiss Wright Second Quarter 2019 Financial Results 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 conference is being recorded.

I would now like to introduce your host for today's call, Jim Ryan, Senior Director of Investor Relations. You may begin.

Executive
James Ryan

Thank you, Joanna, and good morning, everyone. Welcome to Curtiss-Wright's Second Quarter 2019 Earnings Cnference Call. Joining me on the call today are Dave Adams, our Chairman and Chief Executive Officer and Glenn Tynan, our Vice President and Chief Financial Officer.

Our call today is being webcast and the press release, as well as a copy of today's financial presentation, are available for download through the Investor Relations section of our Company website at www.curtisswright.com. A replay of this webcast also can be found on our website.

Please note, today's discussion will include certain projections and statements that are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are not guarantees of future performance. We detailed those risks and uncertainties associated with our forward-looking statements in our public filings with the SEC. As a reminder, the Company's results and guidance, including adjusted non-GAAP view that excludes first-year purchase accounting costs associated with acquisitions for current and prior-year period. In addition, they exclude one-time transition in IT security costs associated with the relocation of the DRG business in the Power segment.

Reconciliations for current and prior year periods are available in the earnings release at the end of this presentation and on our website. In addition, any references to organic growth exclude the effects of foreign currency translation, acquisitions and divestitures unless otherwise noted.

Now I would like to turn the call over to Dave to get things started. Dave?

Executive
David Adams

Thank you, Jim. Good morning, everyone. I'll begin with a few highlights of our second quarter results and full-year 2019 outlook. Then I'll turn it over to Glenn to provide a more detailed review of our second quarter along with updates to our full-year guidance. Finally, I'll return to wrap up our prepared remarks before we move to Q&A.

Building on the momentum generated in the first quarter, we delivered solid second-quarter results and exceeded our expectations for profitability and earnings per share. Our performance was led by strong double-digit sales growth in our defense markets, fueled by 10% organic growth as we capitalize on Curtiss-Wright's strong presence on key military platforms.

Adjusted operating margin was 16.8% driven by solid operational performances in the Commercial, Industrial and Power segments as well as the benefits of our ongoing margin improvement initiatives. In addition, our second-quarter results included a significant ramp-up in R&D investments to support future organic growth and a one-time gain that was originally expected in the third quarter. Adjusted diluted EPS of $1.90 increased 6% compared