Business Wire | Aug 3, 2021 04:23PM EDT

Curtiss-Wright Reports Second Quarter 2021 Financial Results; Raises Full-year 2021 Financial Guidance

Aug. 03, 2021

DAVIDSON, N.C.--(BUSINESS WIRE)--Aug. 03, 2021--Curtiss-Wright Corporation (NYSE: CW) reports financial results for the second quarter ended June 30, 2021.

Second Quarter2021 Highlights:

* Reported sales of $621 million, operating income of $95 million, operating margin of 15.2%, diluted earnings per share (EPS) of $1.49, and free cash flow of $66 million; * Adjusted sales of $609 million, up 14%; * Adjusted operating income of $95 million, up 24%; * Adjusted operating margin of 15.6%, up 120 basis points; * Adjusted diluted EPS of $1.56, up 22%; and * New orders of $679 million, up 11%, led by strong demand in our Commercial markets.

Raised Full-Year2021 Financial Guidance:

* Adjusted sales increased by $15 million due to ongoing recovery in general industrial market demand; Maintaining overall range of 7% to 9% sales growth; * Adjusted operating income increased to new range of 9% to 12% growth (previously 9% to 11%); * Adjusted operating margin increased by 10 basis points to new range of 16.7% to 16.8%, up 40 to 50 basis points compared with the prior year; and * Adjusted diluted EPS increased by $0.05 to new range of $7.15 to $7.35, up 9% to 12%.

"We delivered strong second quarter results, as Adjusted diluted EPS grew by 22%, led by solid sales growth across the majority of our markets, and improved profitability in the Aerospace & Industrial and Naval & Power segments," said Lynn M. Bamford, President and CEO of Curtiss-Wright Corporation. "We also benefitted from the continued execution of our operational excellence initiatives and savings generated by our prior year restructuring actions to drive continued operating margin expansion. In addition, we continued to direct incrementally higher investments in research and development projects that target the highest growth vectors in our end markets and support our long-term organic growth. Based on our solid year-to-date results and outlook for the remainder of 2021, we have increased our full-year Adjusted guidance for sales, operating income, operating margin and diluted EPS."

"As we introduced at our recent Investor Day event in May, we are executing with confidence on our new Pivot to Growth strategy to unlock significant value for our shareholders. Through a renewed focus on disciplined, strategic investments and the deployment of our new operational growth platform, we are well-positioned to deliver on our new three-year targets through 2023, which includes a 5% to 10% revenue CAGR, continued operating margin expansion with operating income growth greater than revenue growth, adjusted diluted EPS CAGR at or above 10%, and sustained free cash flow conversion above 110% on average."

Second Quarter 2021 Operating Results

(In millions) Q2-2021 Q2-2020 Change

Reported sales $ 621.5 $ 550.0 13%

Adjustments ^(1) (12.1 ) (17.3 )

Adjusted sales ^(1) $ 609.4 $ 532.7 14%

Reported operating income $ 94.6 $ 55.3 71%

Adjustments ^(1) 0.5 21.2

Adjusted operating income ^(1) $ 95.0 $ 76.6 24%

Adjusted operating margin ^(1) 15.6 % 14.4 % 120 bps

Amounts may not add due to rounding.

(1)Adjusted results exclude (i) our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited and our German valves business, which was classified as held for sale, both in the fourth quarter of 2020 impacting both periods; (ii) first year purchase accounting costs associated with acquisitionsin both periods; and (iii) a non-cash impairment of capitalized development costs related to a commercial aerospace program, one-time costs associated with the relocation of our DRG business in the Naval & Power segment, and restructuring costs, which impacted the prior year period.

* Adjusted sales of $609 million, up $77 million, or 14%; * Aerospace & Defense market sales increased 11%, led by strong growth in naval defense and the contribution of the PacStar acquisition in ground defense, which more than offset lower aerospace defense revenues; * Commercial market sales increased 21%, principally due to strong demand in the general industrial market, as well as higher power & process market sales; * Adjusted operating income was $95 million, up 24%, while Adjusted operating margin increased 120 basis points to 15.6%. This improvement was driven by favorable overhead absorption on higher organic revenues in both our Aerospace & Industrial and Naval & Power segments, as well as the benefits of our prior year restructuring and ongoing company-wide operational excellence initiatives, which were partially offset by $5 million in higher research and development investments; and * Non-segment expenses of $10 million increased by $2 million compared with the prior year, due to higher environmental and other corporate expenses.

Free Cash Flow

Amounts may not add due to rounding.

Adjusted results exclude (i) our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited and our German valves business, which was classified as held for sale, both in the fourth quarter of 2020 impacting both periods; (ii) first year purchase accounting costs(1) associated with acquisitions in both periods; and (iii) a non-cash impairment of capitalized development costs related to a commercial aerospace program, one-time costs associated with the relocation of our DRG business in the Naval & Power segment, and restructuring costs, which impacted the prior year period.

* Adjusted sales of $609 million, up $77 million, or 14%; * Aerospace & Defense market sales increased 11%, led by strong growth in naval defense and the contribution of the PacStar acquisition in ground defense, which more than offset lower aerospace defense revenues; * Commercial market sales increased 21%, principally due to strong demand in the general industrial market, as well as higher power & process market sales; * Adjusted operating income was $95 million, up 24%, while Adjusted operating margin increased 120 basis points to 15.6%. This improvement was driven by favorable overhead absorption on higher organic revenues in both our Aerospace & Industrial and Naval & Power segments, as well as the benefits of our prior year restructuring and ongoing company-wide operational excellence initiatives, which were partially offset by $5 million in higher research and development investments; and * Non-segment expenses of $10 million increased by $2 million compared with the prior year, due to higher environmental and other corporate expenses.

Free Cash Flow

(In millions) Q2-2021 Q2-2020 Change

Net cash provided by operating activities $ 75.1 $ 140.4 (47%)

Capital expenditures (9.2 ) (10.7 ) 14%

Free cash flow $ 65.8 $ 129.7 (49%)

Adjustment to capital expenditures (DRG facility - 2.0 -investment) ^(1)

Restructuring ^(1) - 4.1 -

Adjusted free cash flow ^(1) $ 65.8 $ 135.8 (51%)

Amounts may not add due to rounding.

(1)Adjusted free cash flow excludes a capital investment related to the new state-of-the-art naval facility in the Naval & Power segment and the cash impact from restructuring in the prior year period.

* Free cash flow of $66 million, defined as cash flow from operations less capital expenditures, decreased $64 million, or 49%, principally driven by the timing of collections and tax payments, partially offset by higher net earnings; * Capital expenditures decreased $1 million compared with the prior year, primarily due to lower capital investments as a result of the completion of our new DRG facility within the Naval & Power segment; and * Adjusted free cash flow of $66 million, down $70 million, or 51%.

New Orders and Backlog

* New orders of $679 million increased 11% compared with the prior year period, generating overall book to bill of approximately 1.1x, driven by strong demand in our Commercial markets, most notably for industrial vehicle products; and * Backlog of $2.2 billion improved slightly from December 31, 2020, principally reflecting the rebound in commercial market demand.

Share Repurchase and Dividends

* During the second quarter, the Company repurchased 100,719 shares of its common stock for approximately $13 million; * Year-to-date, the Company repurchased 206,208 shares for approximately $25 million; and * During the quarter, the Board of Directors declared a 6% increase in the quarterly dividend to $0.18 per share.

Other Items - Business Held for Sale

* During the fourth quarter of 2020, the Company classified its German valves business (previously within its Commercial/Industrial segment) as held for sale and its results have been adjusted from comparisons between our current and prior year results, and full-year financial guidance.

Second Quarter 2021 Segment Performance

Aerospace & Industrial

Amounts may not add due to rounding.

Adjusted free cash flow excludes a capital investment related to the new(1) state-of-the-art naval facility in the Naval & Power segment and the cash impact from restructuring in the prior year period.

* Free cash flow of $66 million, defined as cash flow from operations less capital expenditures, decreased $64 million, or 49%, principally driven by the timing of collections and tax payments, partially offset by higher net earnings; * Capital expenditures decreased $1 million compared with the prior year, primarily due to lower capital investments as a result of the completion of our new DRG facility within the Naval & Power segment; and * Adjusted free cash flow of $66 million, down $70 million, or 51%.

New Orders and Backlog

* New orders of $679 million increased 11% compared with the prior year period, generating overall book to bill of approximately 1.1x, driven by strong demand in our Commercial markets, most notably for industrial vehicle products; and * Backlog of $2.2 billion improved slightly from December 31, 2020, principally reflecting the rebound in commercial market demand.

Share Repurchase and Dividends

* During the second quarter, the Company repurchased 100,719 shares of its common stock for approximately $13 million; * Year-to-date, the Company repurchased 206,208 shares for approximately $25 million; and * During the quarter, the Board of Directors declared a 6% increase in the quarterly dividend to $0.18 per share.

Other Items - Business Held for Sale

* During the fourth quarter of 2020, the Company classified its German valves business (previously within its Commercial/Industrial segment) as held for sale and its results have been adjusted from comparisons between our current and prior year results, and full-year financial guidance.

Second Quarter 2021 Segment Performance

Aerospace & Industrial

(In millions) Q2-2021 Q2-2020 Change

Reported sales $ 199.7 $ 177.4 13%

Adjustments ^(1) (5.8 ) (11.7 )

Adjusted sales ^(1) $ 193.9 $ 165.7 17%

Reported operating income $ 32.0 $ 9.6 233%

Adjustments ^(1) (1.5 ) 3.2

Adjusted operating income ^(1) $ 30.5 $ 12.8 138%

Adjusted operating margin ^(1) 15.7 % 7.7 % 800 bps

Amounts may not add due to rounding.

(1)Adjusted results exclude our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited in the fourth quarter of 2020 impacting both periods and restructuring costs in the prior year period.

* Reported results reflected sales of $200 million, operating income of $32 million and operating margin of 16.0%; * Adjusted sales of $194 million, up $28 million, or 17%; * General industrial market revenue increased by nearly 40%, led by strong industrial vehicle demand for on- and off-highway platforms, and higher sales of surface treatment services due to improving economic conditions; * Commercial aerospace market revenues were essentially flat, as higher sales of sensors products on narrowbody platforms were mainly offset by lower actuation sales on widebody platforms; and * Adjusted operating income was $30 million, up 138% from the prior year, while Adjusted operating margin increased 800 basis points to 15.7%, reflecting strong absorption on higher general industrial market sales, and the benefits of our ongoing operational excellence and prior year restructuring initiatives.

Defense Electronics

Amounts may not add due to rounding.

Adjusted results exclude our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited in the fourth quarter(1) of 2020 impacting both periods and restructuring costs in the prior year period.

* Reported results reflected sales of $200 million, operating income of $32 million and operating margin of 16.0%; * Adjusted sales of $194 million, up $28 million, or 17%; * General industrial market revenue increased by nearly 40%, led by strong industrial vehicle demand for on- and off-highway platforms, and higher sales of surface treatment services due to improving economic conditions; * Commercial aerospace market revenues were essentially flat, as higher sales of sensors products on narrowbody platforms were mainly offset by lower actuation sales on widebody platforms; and * Adjusted operating income was $30 million, up 138% from the prior year, while Adjusted operating margin increased 800 basis points to 15.7%, reflecting strong absorption on higher general industrial market sales, and the benefits of our ongoing operational excellence and prior year restructuring initiatives.

Defense Electronics

(In millions) Q2-2021 Q2-2020 Change

Reported sales $ 162.4 $ 139.6 16%

Adjustments ^(1) 1.1 0.2

Adjusted sales ^(1) $ 163.4 $ 139.8 17%

Reported operating income $ 29.3 $ 24.7 18%

Adjustments ^(1) 1.6 8.8

Adjusted operating income ^(1) $ 30.8 $ 33.5 (8%)

Adjusted operating margin ^(1) 18.9 % 24.0 % (510 bps)

Amounts may not add due to rounding.

(1)Adjusted results exclude first year purchase accounting costs associated with acquisitionsin both periods, and a non-cash impairment of capitalized development costs related to a commercial aerospace program and restructuring costs in the prior year period.

* Reported results reflected sales of $162 million, operating income of $29 million and operating margin of 18.0%; * Adjusted sales of $163 million, up $24 million, or 17%, principally driven by the contribution from the PacStar acquisition for tactical battlefield communications equipment within our ground defense market; * Aerospace defense market revenue declined due to the timing of sales of our embedded computing equipment on various programs; * Higher commercial aerospace market revenues reflect increased sales of avionics and flight test equipment on various domestic and international platforms; and * Adjusted operating income was $31 million, down 8% from the prior year, while Adjusted operating margin decreased 510 basis points to 18.9%, reflecting unfavorable mix in defense electronics and $4 million in higher research and development investments.

Naval & Power

Amounts may not add due to rounding.

Adjusted results exclude first year purchase accounting costs associated with acquisitions in both periods, and a non-cash impairment of capitalized(1) development costs related to a commercial aerospace program and restructuring costs in the prior year period.

* Reported results reflected sales of $162 million, operating income of $29 million and operating margin of 18.0%; * Adjusted sales of $163 million, up $24 million, or 17%, principally driven by the contribution from the PacStar acquisition for tactical battlefield communications equipment within our ground defense market; * Aerospace defense market revenue declined due to the timing of sales of our embedded computing equipment on various programs; * Higher commercial aerospace market revenues reflect increased sales of avionics and flight test equipment on various domestic and international platforms; and * Adjusted operating income was $31 million, down 8% from the prior year, while Adjusted operating margin decreased 510 basis points to 18.9%, reflecting unfavorable mix in defense electronics and $4 million in higher research and development investments.

Naval & Power

(In millions) Q2-2021 Q2-2020 Change

Reported sales $ 259.4 $ 233.0 11%

Adjustments ^(1) (7.4 ) (5.8 )

Adjusted sales ^(1) $ 252.0 $ 227.2 11%

Reported operating income $ 43.1 $ 29.1 48%

Adjustments ^(1) 0.4 9.2

Adjusted operating income ^(1) $ 43.5 $ 38.3 13%

Adjusted operating margin ^(1) 17.2 % 16.9 % 30 bps

Amounts may not add due to rounding.

(1)Adjusted results exclude our German valves business which was classified as held for sale in the fourth quarter of 2020 impacting both periods; and first year purchase accounting costs associated with acquisitions, one-time costs associated with the relocation of our DRG business and restructuring costs, all impacting the prior year period.

* Reported results reflected sales of $259 million, operating income of $43 million and operating margin of 16.6%; * Adjusted sales of $252 million, up $25 million, or 11%; * Strong naval defense market revenue growth primarily reflected higher production revenues on the CVN-80 and CVN-81 aircraft carrier programs; * Higher power & process market revenues reflected increased nuclear aftermarket maintenance supporting existing operating reactors, as well as higher industrial valve revenues to the oil and gas market; and * Adjusted operating income was $43 million, up 13% from the prior year, while Adjusted operating margin increased 30 basis points to 17.2%, driven by solid absorption on higher revenues, as well as the benefits of our prior year restructuring initiatives.

Full-Year 2021 Guidance

The Company is updating its full-year 2021 Adjusted financial guidance as follows:

Amounts may not add due to rounding.

Adjusted results exclude our German valves business which was classified as held for sale in the fourth quarter of 2020 impacting both periods; and(1) first year purchase accounting costs associated with acquisitions, one-time costs associated with the relocation of our DRG business and restructuring costs, all impacting the prior year period.



* Reported results reflected sales of $259 million, operating income of $43 million and operating margin of 16.6%; * Adjusted sales of $252 million, up $25 million, or 11%; * Strong naval defense market revenue growth primarily reflected higher production revenues on the CVN-80 and CVN-81 aircraft carrier programs; * Higher power & process market revenues reflected increased nuclear aftermarket maintenance supporting existing operating reactors, as well as higher industrial valve revenues to the oil and gas market; and * Adjusted operating income was $43 million, up 13% from the prior year, while Adjusted operating margin increased 30 basis points to 17.2%, driven by solid absorption on higher revenues, as well as the benefits of our prior year restructuring initiatives.

Full-Year 2021 Guidance

The Company is updating its full-year 2021 Adjusted financial guidance as follows:

2021 2021 Adjusted Adjusted

(In millions, Non-GAAP Changes to Non-GAAP 2021 Adjusted Chg vsexcept EPS) Adjusted Guidance 2020 Restated Guidance Guidance

(Prior) (Current)

Total Sales $2,450 - $15 $2,465 - Up 7% - 9% $2,500 $2,515

Operating Income $408 - $3 $411 - Up 9% - 12% $418 $421

Operating Margin 16.6% - 10 bps 16.7% - Up 40 - 50 bps 16.7% 16.8%

Effective Tax 23.5% 50 bps 24.0% Rate

Diluted EPS $7.10 - $0.05 $7.15 - Up 9% - 12% $7.30 $7.35

Diluted Shares 41.3 (0.2) 41.1 Outstanding

Free Cash Flow $330 - - $330 - (FCF) $360 $360

Avg. FCF ~116% - ~116% Conversion

(1)2021 Adjusted financial guidance used in comparisons to 2020 financial results excludes first year purchase accounting costs associated with acquisitions, as well as our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited and our German valves business which was classified as held for sale, both in the fourth quarter of 2020.

A more detailed breakdown of the Company's 2021 financial guidance by segment and by market, as well as all reconciliations of Reported GAAP amounts to Adjusted non-GAAP amounts can be found in the accompanying schedules. Historical financial results in the new segment structure for 2020 and 2019 periods are available in the Investor Relations section of Curtiss-Wright's website.

Conference Call & Webcast Information

The Company will host a conference call to discuss second quarter 2021 financial results and updates to 2021 guidance at 10:00 a.m. ET on Wednesday, August 4, 2021. A live webcast of the call and the accompanying financial presentation, as well as a replay of the call, will be made available on the internet by visiting the Investor Relations section of the Company's website at www.curtisswright.com.

(Tables to Follow)



2021 Adjusted financial guidance used in comparisons to 2020 financial results excludes first year purchase accounting costs associated with acquisitions, as well as our build-to-print actuation product line(1) supporting the Boeing 737 MAX program which we exited and our German valves business which was classified as held for sale, both in the fourth quarter of 2020.

A more detailed breakdown of the Company's 2021 financial guidance by segment and by market, as well as all reconciliations of Reported GAAP amounts to Adjusted non-GAAP amounts can be found in the accompanying schedules. Historical financial results in the new segment structure for 2020 and 2019 periods are available in the Investor Relations section of Curtiss-Wright's website.

Conference Call & Webcast Information

The Company will host a conference call to discuss second quarter 2021 financial results and updates to 2021 guidance at 10:00 a.m. ET on Wednesday, August 4, 2021. A live webcast of the call and the accompanying financial presentation, as well as a replay of the call, will be made available on the internet by visiting the Investor Relations section of the Company's website at www.curtisswright.com.

(Tables to Follow)

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)

($'s in thousands, except per share data)



Three Months Ended Six Months Ended

June 30, June 30,

2021 2020 2021 2020



Product sales $ 515,392 $ 466,445 $ 1,024,367 $ 964,374

Service sales 106,103 83,602 194,187 186,904

Total net 621,495 550,047 1,218,554 1,151,278 sales



Cost of 331,881 309,152 661,335 639,965 product sales

Cost of 64,895 54,869 122,743 124,708 service sales

Total cost of 396,776 364,021 784,078 764,673 sales



Gross profit 224,719 186,026 434,476 386,605



Research anddevelopment 23,194 18,269 45,057 36,576 expenses

Selling 29,564 25,193 59,160 56,781 expenses

General andadministrative 77,378 76,606 150,610 153,264 expenses

Restructuring - 10,609 - 12,189 expenses



Operating 94,583 55,349 179,649 127,795 income



Interest 10,180 8,515 20,139 16,004 expense

Other income, 440 (4,105 ) 5,283 1,427 net



Earningsbefore income 84,843 42,729 164,793 113,218 taxes

Provision for (23,435 ) (11,711 ) (43,916 ) (30,439 ) income taxes

Net earnings $ 61,408 $ 31,018 $ 120,877 $ 82,779



Net earnings per share:

Basic earnings $ 1.50 $ 0.75 $ 2.95 $ 1.97 per share

Dilutedearnings per $ 1.49 $ 0.74 $ 2.94 $ 1.95 share



Dividends per $ 0.18 $ 0.17 $ 0.35 $ 0.34 share



Weightedaverage shares outstanding:

Basic 40,915 41,629 40,921 42,092

Diluted 41,088 41,855 41,092 42,362



CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

($'s in thousands, except par value)



June 30, December 31,

2021 2020

Assets

Current assets:

Cash and cash equivalents $ 197,508 $ 198,248

Receivables, net 644,089 588,718

Inventories, net 446,689 428,879

Assets held for sale 29,687 27,584

Other current assets 83,417 57,395

Total current assets 1,401,390 1,300,824

Property, plant, and equipment, net 366,789 378,200

Goodwill 1,466,735 1,455,137

Other intangible assets, net 568,604 609,630

Operating lease right-of-use assets, net 144,274 150,898

Prepaid pension asset 105,963 92,531

Other assets 31,230 34,114

Total assets $ 4,084,985 $ 4,021,334



Liabilities

Current liabilities:

Current portion of long-term and 100,000 100,000 short-term debt

Accounts payable 166,253 201,237

Accrued expenses 133,264 146,833

Deferred revenue 260,358 253,411

Liabilities held for sale 10,573 10,141

Other current liabilities 104,024 98,755

Total current liabilities 774,472 810,377

Long-term debt 957,504 958,292

Deferred tax liabilities, net 121,895 115,007

Accrued pension and other postretirement 97,143 98,345 benefit costs

Long-term operating lease liability 127,136 133,069

Long-term portion of environmental reserves 14,655 15,422

Other liabilities 97,476 103,248

Total liabilities 2,190,281 2,233,760



Stockholders' equity

Common stock, $1 par value 49,187 49,187

Additional paid in capital 119,946 122,535

Retained earnings 2,776,884 2,670,328

Accumulated other comprehensive loss (297,531 ) (310,856 )

Less: cost of treasury stock (753,782 ) (743,620 )

Total stockholders' equity 1,894,704 1,787,574



Total liabilities and stockholders' $ 4,084,985 $ 4,021,334 equity



CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

SEGMENT INFORMATION (UNAUDITED)^(1)

($'s in thousands)





Three Months Ended Six Months Ended

June 30, June 30,

Change Change

2021 2020 % 2021 2020 %

Sales:

Aerospace & $ 199,713 $ 177,411 13 % $ 380,044 $ 404,139 (6 %)Industrial

Defense Electronics 162,351 139,613 16 % 343,563 279,194 23 %

Naval & Power 259,431 233,023 11 % 494,947 467,945 6 %



Total sales $ 621,495 $ 550,047 13 % $ 1,218,554 $ 1,151,278 6 %



Operating income(expense):

Aerospace & $ 31,977 $ 9,615 233 % $ 51,002 $ 41,755 22 %Industrial

Defense Electronics 29,271 24,736 18 % 65,894 48,799 35 %

Naval & Power 43,095 29,146 48 % 81,152 57,256 42 %



Total segments $ 104,343 $ 63,497 64 % $ 198,048 $ 147,810 34 %

Corporate and other (9,760 ) (8,148 ) (20 %) (18,399 ) (20,015 ) 8 %



Total operating $ 94,583 $ 55,349 71 % $ 179,649 $ 127,795 41 %income



Operating margins:

Aerospace & 16.0 % 5.4 % 1,060 13.4 % 10.3 % 310 bpsIndustrial bps

Defense Electronics 18.0 % 17.7 % 30 bps 19.2 % 17.5 % 170 bps

Naval & Power 16.6 % 12.5 % 410 16.4 % 12.2 % 420 bps bps

Total Curtiss-Wright 15.2 % 10.1 % 510 14.7 % 11.1 % 360 bps bps



Segment margins 16.8 % 11.5 % 530 16.3 % 12.8 % 350 bps bps



^(1) Amounts reported under realigned segment reporting structure.

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

RECONCILIATION OF REPORTED SALES TO ADJUSTED SALES BY END MARKET (UNAUDITED)

($'s in thousands)



Three Months Ended Three Months Ended

June 30, 2021 June 30, 2020 2021 vs. 2020

Change Reported Adjusted Reported Adjusted in Sales Adjustments Sales Sales Adjustments Sales Adjusted Sales

Aerospace &Defense markets:

Aerospace $ 99,977 $ - $ 99,977 $ 109,305 $ 201 $ 109,506 (9%)Defense ^(1)

Ground Defense 48,221 1,080 49,301 20,029 - 20,029 146%^(1)

Naval Defense 177,724 - 177,724 164,941 - 164,941 8%

Commercial 71,555 (5,784) 65,771 71,084 (11,710) 59,374 11%Aerospace ^(2)

TotalAerospace & $ 397,477 $ (4,704) $ 392,773 $ 365,359 $ (11,509) $ 353,850 11%Defense



Commercial markets:

Power & 125,333 (7,413) 117,920 112,787 (5,835) 106,952 10%Process ^(3)

General 98,685 - 98,685 71,901 - 71,901 37%Industrial

Total 224,018 (7,413) 216,605 184,688 (5,835) 178,853 21%Commercial



Total $ 621,495 $ (12,117) $ 609,378 $ 550,047 $ (17,344) $ 532,703 14%Curtiss-Wright



Six Months Ended Six Months Ended

June 30, 2021 June 30, 2020 2021 vs. 2020

Change Reported Adjusted Reported Adjusted in Sales Adjustments Sales Sales Adjustments Sales Adjusted Sales

Aerospace &Defense markets:

Aerospace $ 210,993 $ - $ 210,993 $ 211,133 $ 201 $ 211,334 0%Defense ^(1)

Ground Defense 103,967 2,160 106,127 42,686 - 42,686 149%^(1)

Naval Defense 355,629 - 355,629 330,633 - 330,633 8%

Commercial 128,824 (8,383) 120,441 171,765 (30,405) 141,360 (15%)Aerospace ^(2)

TotalAerospace & $ 799,413 $ (6,223) $ 793,190 $ 756,217 $ (30,204) $ 726,013 9%Defense



Commercial markets:

Power & 230,837 (12,996) 217,841 236,713 (12,708) 224,005 (3%)Process ^(3)

General 188,304 - 188,304 158,348 - 158,348 19%Industrial

Total $ 419,141 $ (12,996) $ 406,145 $ 395,061 $ (12,708) $ 382,353 6%Commercial



Total $ 1,218,554 $ (19,219) $ 1,199,335 $ 1,151,278 $ (42,912) $ 1,108,366 8%Curtiss-Wright



^(1) Adjustments exclude first year purchase accounting adjustments associatedwith acquisitions.

^(2) Adjustments exclude our build-to-print actuation product line supportingthe Boeing 737 MAX program which we exited in the fourth quarter of 2020.

^(3) Adjustments exclude our German valves business which was classified asheld for sale in the fourth quarter of 2020.

Use of Non-GAAP Financial Information (Unaudited)

The Corporation supplements its financial information determined under U.S. generally accepted accounting principles (GAAP) with certain non-GAAP financial information. Curtiss-Wright believes that these non-GAAP measures provide investors with additional insight into the Company's ongoing business performance. These non-GAAP measures should not be considered in isolation or as a substitute for the related GAAP measures, and other companies may define such measures differently. Curtiss-Wright encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

The Company's presentation of its financials and guidance includes an Adjusted (non-GAAP) view that excludes (i) the results of a build-to-print actuation product line supporting the Boeing 737 MAX program which we exited and a German valves business classified as held for sale, both in the fourth quarter of 2020; (ii) significant restructuring costs in 2020 associated with its operations, including one-time actions taken in response to COVID-19; (iii) a non-cash impairment of capitalized development costs related to a commercial aerospace program in the prior period; (iv) first year purchase accounting costs associated with its acquisitions in both periods, including one-time inventory step-up, backlog amortization, deferred revenue adjustments and transaction costs; and (v) one-time transition and IT security costs, and capital investments, specifically associated with the relocation of the DRG business in the Naval & Power segment in the prior period. Transition costs include relocation of employees and equipment as well as overlapping facility and labor costs associated with the relocation. We believe this Adjusted view will provide improved transparency in order to better measure Curtiss-Wright's ongoing operating and financial performance and better comparisons of our key financial metrics to our peers. Reconciliations of "Reported" GAAP amounts to "Adjusted" non-GAAP amounts are furnished within this release.

The following definitions are provided:

Adjusted Sales, Operating Income, Operating Margin, Net Earnings and Diluted EPS

These Adjusted financials are defined as Reported Sales, Operating Income, Operating Margin, Net Earnings and Diluted Earnings per Share (EPS) under GAAP excluding: (i) the impact of first year purchase accounting costs associated with acquisitions for current and prior year periods, specifically one-time inventory step-up, backlog amortization, deferred revenue adjustments and transaction costs; (ii) one-time transition and IT security costs associated with the relocation of a business in the prior year period; (iii) the non-cash impairment of capitalized development costs related to a commercial aerospace program in the prior year period; (iv) significant restructuring costs in 2020 associated with its operations, (v) a build-to-print actuation product line supporting the Boeing 737 MAX program which we exited, and (vi) the results of a German valves business classified as held for sale in the fourth quarter of 2020.

Organic Sales and Organic Operating Income

The Corporation discloses organic sales and organic operating income because the Corporation believes it provides investors with insight as to the Company's ongoing business performance. Organic sales and organic operating income are defined as sales and operating income excluding the impact of restructuring costs, foreign currency fluctuations and contributions from acquisitions made during the last twelve months.

Three Months Ended

June 30,

2021 vs. 2020

Aerospace & Defense Naval & Power Total Industrial Electronics Curtiss-Wright

Operating Operating Operating Operating Sales Sales Sales Sales income income income income

Organic 10% 174% (6%) 12% 10% 24% 6% 46%

Acquisitions 0% 0% 22% 9% 0% 0% 6% 4%

Restructuring 0% 59% 0% 7% 0% 26% 0% 26%

Foreign 3% 0% 0% (10%) 1% (2%) 1% (5%)Currency

Total 13% 233% 16% 18% 11% 48% 13% 71%



Six Months Ended

June 30,

2021 vs. 2020

Aerospace & Defense Naval & Power Total Industrial Electronics Curtiss-Wright

Operating Operating Operating Operating Sales Sales Sales Sales income income income income

Organic (8%) 8% (1%) 26% 4% 28% (1%) 26%

Acquisitions 0% 0% 23% 12% 0% 0% 6% 4%

Restructuring 0% 14% 0% 5% 0% 16% 0% 14%

Foreign 2% 0% 1% (8%) 2% (2%) 1% (3%)Currency

Total (6%) 22% 23% 35% 6% 42% 6% 41%

Free Cash Flow and Free Cash Flow Conversion

The Corporation discloses free cash flow because it measures cash flow available for investing and financing activities. Free cash flow represents cash available to repay outstanding debt, invest in the business, acquire businesses, return capital to shareholders and make other strategic investments. Free cash flow is defined as cash flow provided by operating activities less capital expenditures. Adjusted free cash flow for 2020 excludes: (i) a capital investment in the Naval & Power segment related to the new, state-of-the-art naval facility principally for DRG; (ii) a voluntary contribution to the Company's corporate defined benefit pension plan made in the first quarter of 2020; and (iii) the cash impact from restructuring in 2020. The Corporation discloses adjusted free cash flow conversion because it measures the proportion of net earnings converted into free cash flow and is defined as adjusted free cash flow divided by adjusted net earnings.

CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

NON-GAAP FINANCIAL DATA (UNAUDITED)

($'s in thousands)





Three Months Ended Six Months Ended

June 30, June 30,

2021 2020 2021 2020



Net cash provided by $ 75,079 $ 140,367 $ 48,476 $ (52,209) operating activities

Capital expenditures (9,234) (10,687) (17,771) (29,324)

Free cash flow $ 65,845 $ 129,680 $ 30,705 $ (81,533)

Voluntary pension - - - 150,000 contribution

Adjustment to capitalexpenditures (DRG - 1,998 - 9,675 facility investment)

Restructuring - 4,076 - 4,741

Adjusted free cash flow $ 65,845 $ 135,754 $ 30,705 $ 82,883

Adjusted free cash flow 101 % 247 % 24 % 74 %conversion

CURTISS-WRIGHT CORPORATION2021 Guidance (New Segment Structure)As of August 3, 2021($'s in millions, except per share data) 2020 2020 2021 2021 Exiting Exiting 2021 Adjusted Adjusted ^ Reported Adjustments Non-Core (2,4) Non-Core ^(3) Adjusted Guidance^ (3) Non-GAAP) Guidance ^(1) Operations (Non-GAAP) Operations (Non-GAAP) (Non-GAAP) (GAAP)

2021 Chg Low High Low High vs 2020 AdjustedSales:Aerospace & $ 805 $ (67 ) $ 738 $ 774 $ 789 $ (14 ) $ - $ 760 $ 775 3 - 5 %IndustrialDefense 611 - 611 745 760 - - 745 760 22 - %Electronics 24

Naval & 977 (26 ) 951 991 1,011 (31 ) - 960 980 1 - 3 %PowerTotal sales $ 2,393 $ (93 ) $ 2,300 $ 2,510 $ 2,560 $ (45 ) $ - $ 2,465 $ 2,515 7 to 9%

Operatingincome:Aerospace & $ 114 $ (16 ) $ 98 $ 117 $ 120 $ (2 ) $ - $ 115 $ 118 17 - %Industrial 21

Defense 144 - 144 153 158 - 6 159 164 10 - %Electronics 13

Naval & 171 - 171 176 181 (2 ) - 174 179 2 - 5 %PowerTotal 429 (16 ) 413 446 459 (4 ) 6 448 461 segmentsCorporate (38 ) - (38 ) (37 ) (39 ) - - (37 ) (39 )and otherTotal $ 391 $ (16 ) $ 375 $ 409 $ 419 $ (4 ) $ 6 $ 411 $ 421 operating 9 to 12%income Interest $ (36 ) $ - $ (36 ) $ (41 ) $ (41 ) $ - $ - $ (41 ) $ (41 )expenseOther 21 - 21 13 13 - 3 16 17 income, netEarningsbefore 377 (16 ) 361 381 392 (4 ) 9 386 397 incometaxesProvision (88 ) 4 (85 ) (91 ) (94 ) 1 (2 ) (93 ) (95 )for incometaxesNet $ 289 $ (12 ) $ 277 $ 290 $ 298 $ (3 ) $ 7 $ 294 $ 302 earnings Diluted $ 6.87 $ (0.29 ) $ 6.59 $ 7.05 $ 7.25 $ (0.07 ) $ 0.17 $ 7.15 $ 7.35 earnings 9 to 12%per shareDiluted 42.0 42.0 41.1 41.1 41.1 41.1 sharesoutstandingEffective 23.4 % 23.4 % 24.0 % 24.0 % 24.0 % 24.0 %tax rate Operatingmargins:Aerospace & 14.2 % NM 13.3 % 15.1 % 15.2 % +10 bps - 15.1 % 15.3 % 180 toIndustrial 200 bpsDefense 23.6 % NM 23.6 % 20.5 % 20.7 % - +80 bps 21.3 % 21.5 % (210 toElectronics 230 bps)Naval & 17.5 % NM 18.0 % 17.8 % 17.9 % +40 bps - 18.2 % 18.3 % 20 to 30Power bpsTotal 16.3 % NM 16.3 % 16.3 % 16.4 % 16.7 % 16.8 % 40 to 50operating +20 bps +20 bps bpsmargin Free cash $ 394 $ - $ 394 $ 330 $ 360 - - $ 330 $ 360 flow Notes: Full year amounts may not add due to rounding. All financial informationby reportable segment for the 2020 and 2021 reporting periods reflects theCorporation's first quarter 2021 segment reorganization.(1) A reconciliation of our 2020 GAAP to our 2020 Non-GAAP Adjusted figures areprovided in our February 24, 2021 press release.(2) 2020 Adjusted financials are defined as Reported Operating Income,Operating Margin, Net Income and Diluted EPS under GAAP excluding restructuringcosts, first year purchase accounting costs, specifically one-time backlogamortization and transaction costs associated with acquisitions, a non-cashimpairment of capitalized development costs related to a commercial aerospaceprogram, and one-time transition and IT security costs related to therelocation of the DRG business, as well as a $10 million non-cash currencytranslation loss (within non-operating income) related to the liquidation of aforeign legal entity. 2020 financial results excludes our build-to-printactuation product line supporting the Boeing 737 MAX program which we exited,as well as our German valves business which was classified as held for sale,both in the fourth quarter of 2020.(3) 2021 Adjusted financials are defined as Reported Operating Income,Operating Margin, Net Income and Diluted EPS under GAAP excluding ourbuild-to-print actuation product line supporting the Boeing 737 MAX programwhich we exited, as well as our German valves business which was classified asheld for sale, both in the fourth quarter of 2020, first year purchaseaccounting costs, specifically one-time backlog amortization and transactioncosts associated with acquisitions, and a one-time, $3 million pensionsettlement charge related to the retirement of two former executives (withinnon-operating income).(4) Free Cash Flow is defined as cash flow from operations less capitalexpenditures. 2020 Adjusted Free Cash Flow guidance excludes a $150 millionvoluntary contribution made in January to the Company's corporate definedbenefit pension plan, a $20 million cash impact from restructuring, and a $10million capital investment related to the new, state-of-the-art naval facilityprincipally for DRG. CURTISS-WRIGHT CORPORATION2021 Sales Growth Guidance by End MarketAs of August 3, 2021 2021 % Change vs 2020

Aerospace & Defense Markets Prior Current % Total Sales

Aerospace Defense 2 - 4% 2 - 4% 19%

Ground Defense 100 - 105% 100 - 105% 9%

Naval Defense Flat 0 - 2% 28%

Commercial Aerospace Flat Flat 10%

Total Aerospace & Defense 7 - 9% 7 - 9% 66%



Commercial Markets

Power & Process 3 - 5% 1 - 3% 18%

General Industrial 9 - 11% 15 - 17% 15%

Total Commercial 6 - 8% 6 - 8% 34%



Total Curtiss-Wright Sales 7 - 9% 7 - 9% 100%

Note: Amounts may not add due to rounding.(1) This table reflects the Company's first quarter 2021 End Market Structureand Realignment, where all Commercial Aerospace market revenues shifted into anewly defined Total Aerospace & Defense market.(2) The Power & Process end market is comprised of a) Nuclear and b) Process,while the General Industrial end market is comprised of a) Industrial Vehiclesand b) Industrial Automation and Services.(3) Based on these changes, all of our general industrial businesses operatewithin the Aerospace & Industrial segment, and the majority of the Company'snuclear and process revenues operate within the Naval & Power segment. About Curtiss-Wright Corporation

Curtiss-Wright Corporation (NYSE:CW) is a global innovative company that delivers highly engineered, critical function products and services to the Aerospace and Defense markets, and to the Commercial markets including Power, Process and General Industrial. Building on the heritage of Glenn Curtiss and the Wright brothers, Curtiss-Wright has a long tradition of providing reliable solutions through trusted customer relationships. The company employs approximately 8,200 people worldwide. For more information, visitwww.curtisswright.com.

Certain statements made in this press release, including statements about future revenue, financial performance guidance, quarterly and annual revenue, net income, operating income growth, future business opportunities, cost saving initiatives, the successful integration of the Company's acquisitions, future cash flow from operations, and potential impacts of the COVID-19 pandemic are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended ("Securities Act"), Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act") and the Private Securities Litigation Reform Act of 1995. These statements present management's expectations, beliefs, plans and objectives regarding future financial performance, and assumptions or judgments concerning such performance. Any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Such risks and uncertainties include, but are not limited to: a reduction in anticipated orders; an economic downturn; changes in the competitive marketplace and/or customer requirements; a change in government spending; an inability to perform customer contracts at anticipated cost levels; the impact of a global pandemic or national epidemic, and other factors that generally affect the business of aerospace, defense contracting, electronics, marine, and industrial companies. Such factors are detailed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and subsequent reports filed with the Securities and Exchange Commission.

This press release and additional information are available at www.curtisswright.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210803006080/en/

CONTACT: Jim Ryan (704) 869-4621 Jim.Ryan@curtisswright.com