Business Wire | Nov 3, 2021 04:16PM EDT

Curtiss-Wright Reports Strong Third Quarter 2021 Results and Raises Midpoint of Full-Year 2021 Adjusted EPS Guidance

Nov. 03, 2021

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

Third Quarter2021 Highlights:

* Reported sales of $621 million, operating income of $98 million, operating margin of 15.7%, diluted earnings per share (EPS) of $1.70, and free cash flow (FCF) of $97 million; * Adjusted sales of $614 million, up 12%; * Adjusted operating income of $108 million, up 12%; * Adjusted operating margin of 17.5%, up 10 basis points; * Adjusted diluted EPS of $1.88, up 6%; * New orders of $617 million, up 13%; and * Adjusted FCF of $97 million, up 76%, with 127% free cash flow conversion.

Expansion of Company's Share Repurchase Authorization:

* In September, the Company's Board of Directors authorized an additional $400 million for future share repurchases, increasing the total available authorization to $550 million; * The Company immediately and opportunistically began the repurchase of $200 million in additional shares via a 10b5-1 program, conducted in concurrence with its existing $50 million share repurchase program being executed this calendar year; and * As of November 3, the Company has completed its $200 million opportunistic share repurchase program, buying back approximately 1.5 million shares, and remains on track to repurchase a total of $250 million in shares in 2021.

Full-Year2021 Adjusted Guidance:

* Raised bottom end of Adjusted diluted EPS guidance to new range of $7.20 to $7.35 (previously $7.15 to $7.35); * Maintained sales growth of 7% to 9%, Adjusted operating income growth of 9% to 12%, and Adjusted operating margin range of 16.7% to 16.8%, up 40 to 50 basis points compared with the prior year; and * Maintained Adjusted FCF range of $330 to $360 million, representing a free cash flow conversion rate of approximately 116%.

"We delivered strong third quarter results, with double-digit growth in sales and operating income, despite supply chain headwinds, which produced Adjusted diluted EPS of $1.88 and generated strong free cash flow of approximately $100 million," said Lynn M. Bamford, President and CEO of Curtiss-Wright Corporation. "Our results reflect the continued execution of our operational excellence initiatives and savings generated by our prior year restructuring actions, which drove operating margin expansion that more than offset the $4 million in incremental year-over-year research and development investments to support our long-term organic growth."

"In addition, we continued to leverage our strong and healthy balance sheet to implement our balanced capital allocation strategy. We firmly delivered on our commitment to drive solid returns to our shareholders by completing the recently announced $200 million opportunistic share repurchase program, and we remain devoted to supporting our organic growth with high quality, strategic acquisitions to drive long-term shareholder value."

"Looking ahead to the remainder of 2021, while global supply chain disruption continues to impact many businesses, we will continue to work aggressively to mitigate any negative effects on Curtiss-Wright, leveraging the strength and resilience of our combined portfolio, which has provided us with confidence to raise the midpoint of our Adjusted diluted EPS guidance range."

Third Quarter 2021 Operating Results

(In millions) Q3-2021 Q3-2020 Change

Reported sales $ 620.6 $ 571.6 9 %

Adjustments ^(1) (6.8 ) (21.7 )

Adjusted sales ^(1) $ 613.8 $ 549.9 12 %



Reported operating income $ 97.7 $ 84.6 15 %

Adjustments ^(1) 9.9 11.2

Adjusted operating income ^(1) $ 107.5 $ 95.8 12 %

Adjusted operating margin ^(1) 17.5 % 17.4 % 10 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 in both periods associated with acquisitions; and (iii) one-time costs associated with the relocation of our DRG business in the Naval & Power segment, and restructuring costs in all segments, which impacted the prior year period.

* Adjusted sales of $614 million, up $64 million, or 12%; * Aerospace & Defense (A&D) market sales increased 15%, led by strong growth in commercial aerospace and naval defense, and the contribution from the PacStar acquisition in ground defense; * Commercial market sales increased 6%, principally due to continued, strong demand in the general industrial market; * Adjusted operating income of $108 million, up 12%, while Adjusted operating margin increased 10 basis points to 17.5%, principally reflecting favorable overhead absorption on higher organic revenues in our Aerospace & Industrial segment, as well as the benefits of our prior year restructuring and ongoing company-wide operational excellence initiatives. Those gains were partially offset by $4 million in higher research and development investments, principally within the Defense Electronics segment; and * Non-segment expenses of $9 million increased by $2 million compared with the prior year, primarily due to higher corporate costs.

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(1) quarter of 2020 impacting both periods; (ii) first year purchase accounting costs in both periods associated with acquisitions; and (iii) one-time costs associated with the relocation of our DRG business in the Naval & Power segment, and restructuring costs in all segments, which impacted the prior year period.

* Adjusted sales of $614 million, up $64 million, or 12%; * Aerospace & Defense (A&D) market sales increased 15%, led by strong growth in commercial aerospace and naval defense, and the contribution from the PacStar acquisition in ground defense; * Commercial market sales increased 6%, principally due to continued, strong demand in the general industrial market; * Adjusted operating income of $108 million, up 12%, while Adjusted operating margin increased 10 basis points to 17.5%, principally reflecting favorable overhead absorption on higher organic revenues in our Aerospace & Industrial segment, as well as the benefits of our prior year restructuring and ongoing company-wide operational excellence initiatives. Those gains were partially offset by $4 million in higher research and development investments, principally within the Defense Electronics segment; and * Non-segment expenses of $9 million increased by $2 million compared with the prior year, primarily due to higher corporate costs.

Free Cash Flow

(In millions) Q3-2021 Q3-2020 Change

Net cash provided by operating activities $ 107.3 $ 56.0 92 %

Capital expenditures (10.1 ) (7.0 ) (44 %)

Free cash flow ^(1) $ 97.2 $ 49.0 98 %

Adjustment to capital expenditures (DRG facility - 0.4 - investment) ^(2)

Restructuring ^(2) - 5.9 -

Adjusted free cash flow ^(2) $ 97.2 $ 55.3 76 %

Amounts may not add due to rounding.

(1)

Free cash flow defined as net cash provided by operating activities less capital expenditures

(2)

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 $97 million increased $48 million, or 98%, principally driven by the timing of tax payments and improvements in working capital; * Capital expenditures increased $3 million compared with the prior year, primarily due to higher capital investments within the Naval & Power segment; and * Adjusted free cash flow of $97 million increased $42 million, or 76%.

New Orders and Backlog

* New orders of $617 million increased 13% compared with the prior year period, generating overall book to bill that exceeded 1.0x, principally driven by solid demand for our commercial aerospace and defense electronics products within our A&D markets, and for industrial vehicle products within our Commercial markets; and * Backlog of $2.2 billion, up 2% from December 31, 2020, principally reflects the rebound in commercial market demand.

Share Repurchase and Dividends

* During the third quarter, the Company repurchased 540,643 shares of its common stock for approximately $67 million; * Year-to-date through September 30, 2021, the Company repurchased 746,851 shares for approximately $92 million; and * The Company also declared a quarterly dividend of $0.18 a share, unchanged from the previous quarter.

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, currently within its Naval & Power 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.

Third Quarter 2021 Segment Performance

Aerospace & Industrial

Amounts may not add due to rounding.

(1) Free cash flow defined as net cash provided by operating activities less capital expenditures

Adjusted free cash flow excludes a capital investment related to the new(2) 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 $97 million increased $48 million, or 98%, principally driven by the timing of tax payments and improvements in working capital; * Capital expenditures increased $3 million compared with the prior year, primarily due to higher capital investments within the Naval & Power segment; and * Adjusted free cash flow of $97 million increased $42 million, or 76%.

New Orders and Backlog

* New orders of $617 million increased 13% compared with the prior year period, generating overall book to bill that exceeded 1.0x, principally driven by solid demand for our commercial aerospace and defense electronics products within our A&D markets, and for industrial vehicle products within our Commercial markets; and * Backlog of $2.2 billion, up 2% from December 31, 2020, principally reflects the rebound in commercial market demand.

Share Repurchase and Dividends

* During the third quarter, the Company repurchased 540,643 shares of its common stock for approximately $67 million; * Year-to-date through September 30, 2021, the Company repurchased 746,851 shares for approximately $92 million; and * The Company also declared a quarterly dividend of $0.18 a share, unchanged from the previous quarter.

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, currently within its Naval & Power 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.

Third Quarter 2021 Segment Performance

Aerospace & Industrial

(In millions) Q3-2021 Q3-2020 Change

Reported sales $ 196.3 $ 188.8 4 %

Adjustments ^(1) (0.4 ) (16.5 )

Adjusted sales ^(1) $ 195.9 $ 172.2 14 %



Reported operating income $ 30.9 $ 23.9 29 %

Adjustments ^(1) (0.1 ) (1.0 )

Adjusted operating income ^(1) $ 30.8 $ 22.9 34 %

Adjusted operating margin ^(1) 15.7 % 13.3 % 240 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 $196 million, operating income of $31 million and operating margin of 15.7%; * Adjusted sales of $196 million, up $24 million, or 14%; * Higher general industrial market revenue principally reflected the continued strong rebound in industrial vehicle product demand for on- and off-highway platforms in response to the economic recovery; * Strong commercial aerospace market revenue growth reflected higher sales of sensors products and surface treatment services on narrowbody platforms, partially offset by lower actuation sales on widebody platforms; and * Adjusted operating income of $31 million, up 34% from the prior year, while Adjusted operating margin increased 240 basis points to 15.7%, reflecting strong absorption on higher 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(1) 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 $196 million, operating income of $31 million and operating margin of 15.7%; * Adjusted sales of $196 million, up $24 million, or 14%; * Higher general industrial market revenue principally reflected the continued strong rebound in industrial vehicle product demand for on- and off-highway platforms in response to the economic recovery; * Strong commercial aerospace market revenue growth reflected higher sales of sensors products and surface treatment services on narrowbody platforms, partially offset by lower actuation sales on widebody platforms; and * Adjusted operating income of $31 million, up 34% from the prior year, while Adjusted operating margin increased 240 basis points to 15.7%, reflecting strong absorption on higher sales, and the benefits of our ongoing operational excellence and prior year restructuring initiatives.

Defense Electronics

(In millions) Q3-2021 Q3-2020 Change

Reported sales $ 181.5 $ 148.3 22 %

Adjustments ^(1) 1.1 0.7

Adjusted sales ^(1) $ 182.6 $ 149.1 22 %



Reported operating income $ 40.8 $ 35.1 16 %

Adjustments ^(1) 1.6 3.5

Adjusted operating income ^(1) $ 42.3 $ 38.7 9 %

Adjusted operating margin ^(1) 23.2 % 25.9 % (270 bps)

Amounts may not add due to rounding.

(1)

Adjusted results exclude first year purchase accounting costs in both periods associated with acquisitions, and restructuring costs in the prior year period.

* Reported results reflected sales of $182 million, operating income of $41 million and operating margin of 22.5%; * Adjusted sales of $183 million, up $34 million, or 22%, principally driven by the contribution from the PacStar acquisition for tactical battlefield communications equipment within our ground defense market; * Lower aerospace defense market revenue reflected reduced sales of our embedded computing equipment on various Unmanned Aerial Vehicle (UAV) and fighter jet platforms, partially offset by solid growth on various helicopter platforms; * Higher commercial aerospace market revenue reflected increased sales of electronic systems and flight test equipment on various domestic and international platforms; and * Adjusted operating income of $42 million, up 9% from the prior year, while Adjusted operating margin decreased 270 basis points to 23.2%, as favorable mix in defense electronics was more than offset by higher research and development investments and unfavorable foreign currency translation.

Naval & Power

Amounts may not add due to rounding.

Adjusted results exclude first year purchase accounting costs in both(1) periods associated with acquisitions, and restructuring costs in the prior year period.

* Reported results reflected sales of $182 million, operating income of $41 million and operating margin of 22.5%; * Adjusted sales of $183 million, up $34 million, or 22%, principally driven by the contribution from the PacStar acquisition for tactical battlefield communications equipment within our ground defense market; * Lower aerospace defense market revenue reflected reduced sales of our embedded computing equipment on various Unmanned Aerial Vehicle (UAV) and fighter jet platforms, partially offset by solid growth on various helicopter platforms; * Higher commercial aerospace market revenue reflected increased sales of electronic systems and flight test equipment on various domestic and international platforms; and * Adjusted operating income of $42 million, up 9% from the prior year, while Adjusted operating margin decreased 270 basis points to 23.2%, as favorable mix in defense electronics was more than offset by higher research and development investments and unfavorable foreign currency translation.

Naval & Power

(In millions) Q3-2021 Q3-2020 Change

Reported sales $ 242.8 $ 234.5 4 %

Adjustments ^(1) (7.5 ) (5.9 )

Adjusted sales ^(1) $ 235.3 $ 228.6 3 %



Reported operating income $ 35.5 $ 33.4 6 %

Adjustments ^(1) 8.4 8.6

Adjusted operating income ^(1) $ 43.9 $ 42.0 4 %

Adjusted operating margin ^(1) 18.6 % 18.4 % 20 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 $243 million, operating income of $35 million and operating margin of 14.6%; * Adjusted sales of $235 million, up $7 million, or 3%; * Strong naval defense market revenue growth primarily reflected higher revenues on the Virginia-class submarine and CVN-81 aircraft carrier programs; * Reduced power & process market sales reflected timing of production on the China Direct AP1000 program in the nuclear market, partially offset by solid industrial valve demand in the oil and gas market; and * Adjusted operating income of $44 million, up 4% from the prior year, while Adjusted operating margin increased 20 basis points to 18.6%, driven by solid absorption on higher revenues and the benefits of our prior year restructuring initiatives, partially offset by unfavorable mix in the power & process market.

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 $243 million, operating income of $35 million and operating margin of 14.6%; * Adjusted sales of $235 million, up $7 million, or 3%; * Strong naval defense market revenue growth primarily reflected higher revenues on the Virginia-class submarine and CVN-81 aircraft carrier programs; * Reduced power & process market sales reflected timing of production on the China Direct AP1000 program in the nuclear market, partially offset by solid industrial valve demand in the oil and gas market; and * Adjusted operating income of $44 million, up 4% from the prior year, while Adjusted operating margin increased 20 basis points to 18.6%, driven by solid absorption on higher revenues and the benefits of our prior year restructuring initiatives, partially offset by unfavorable mix in the power & process market.

Full-Year 2021 Guidance

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

2021 Adjusted 2021 Adjusted(In millions, except EPS) Non-GAAP Non-GAAP 2021 Adjusted Chg Guidance Guidance vs 2020 Restated (Prior) (Current)

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

Operating Income $411 - $421 $411 - $421 Up 9% - 12%

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

Interest Expense $41 $40 - $41

Diluted EPS $7.15 - $7.35 $7.20 - $7.35 Up 9% - 12%

Diluted Shares Outstanding 41.1 41.0

Free Cash Flow $330 - $360 $330 - $360

Avg. FCF Conversion ~116% ~116%

(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 third quarter 2021 financial results and updates to 2021 guidance at 10:00 a.m. ET on Thursday, November 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(1) 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 third quarter 2021 financial results and updates to 2021 guidance at 10:00 a.m. ET on Thursday, November 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 Nine Months Ended

September 30, September 30,

2021 2020 2021 2020



Product sales $ 528,339 $ 493,398 $ 1,552,706 $ 1,457,772

Service sales 92,280 78,216 286,467 265,120

Total net sales 620,619 571,614 1,839,173 1,722,892



Cost of product 328,424 305,921 989,759 945,886 sales

Cost of service 55,187 52,872 177,930 177,580 sales

Total cost of 383,611 358,793 1,167,689 1,123,466 sales



Gross profit 237,008 212,821 671,484 599,426



Research anddevelopment 21,618 17,587 66,675 54,163 expenses

Selling expenses 30,067 24,869 89,227 81,650

General andadministrative 78,998 77,251 229,608 230,515 expenses

Impairment ofassets held for 8,656 - 8,656 - sale

Restructuring - 8,541 - 20,730 expenses



Operating income 97,669 84,573 277,318 212,368



Interest expense 9,955 9,055 30,094 25,059

Other income, net 3,627 5,417 8,910 6,844



Earnings before 91,341 80,935 256,134 194,153 income taxes

Provision for (21,638 ) (16,315 ) (65,554 ) (46,754 ) income taxes

Net earnings $ 69,703 $ 64,620 $ 190,580 $ 147,399



Net earnings per share:

Basic earnings $ 1.71 $ 1.56 $ 4.66 $ 3.52 per share

Diluted earnings $ 1.70 $ 1.55 $ 4.64 $ 3.49 per share



Dividends per $ 0.18 $ 0.17 $ 0.53 $ 0.51 share



Weighted averageshares outstanding:

Basic 40,769 41,545 40,865 41,926

Diluted 40,950 41,797 41,040 42,190



CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

($'s in thousands, except par value)



September 30, December 31,

2021 2020

Assets

Current assets:

Cash and cash equivalents $ 234,416 $ 198,248

Receivables, net 670,867 588,718

Inventories, net 433,140 428,879

Assets held for sale 20,215 27,584

Other current assets 65,171 57,395

Total current assets 1,423,809 1,300,824

Property, plant, and equipment, net 360,314 378,200

Goodwill 1,461,313 1,455,137

Other intangible assets, net 552,514 609,630

Operating lease right-of-use assets, net 140,524 150,898

Prepaid pension asset 111,906 92,531

Other assets 32,921 34,114

Total assets $ 4,083,301 $ 4,021,334



Liabilities

Current liabilities:

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

Accounts payable 158,196 201,237

Accrued expenses 142,169 146,833

Deferred revenue 249,671 253,411

Liabilities held for sale 13,215 10,141

Other current liabilities 101,892 98,755

Total current liabilities 765,143 810,377

Long-term debt 957,101 958,292

Deferred tax liabilities, net 121,491 115,007

Accrued pension and other postretirement 98,122 98,345 benefit costs

Long-term operating lease liability 124,362 133,069

Long-term portion of environmental reserves 15,096 15,422

Other liabilities 101,926 103,248

Total liabilities 2,183,241 2,233,760



Stockholders' equity

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

Additional paid in capital 124,532 122,535

Retained earnings 2,839,294 2,670,328

Accumulated other comprehensive loss (308,810 ) (310,856 )

Less: cost of treasury stock (804,143 ) (743,620 )

Total stockholders' equity 1,900,060 1,787,574



Total liabilities and stockholders' equity $ 4,083,301 $ 4,021,334



CURTISS-WRIGHT CORPORATION and SUBSIDIARIES

SEGMENT INFORMATION (UNAUDITED)^(1)

($'s in thousands)





Three Months Ended Nine Months Ended

September 30, September 30,

Change Change

2021 2020 % 2021 2020 %

Sales:

Aerospace & $ 196,296 $ 188,768 4 % $ 576,340 $ 592,907 (3 %)Industrial

Defense Electronics 181,504 148,324 22 % 525,067 427,518 23 %

Naval & Power 242,819 234,522 4 % 737,766 702,467 5 %



Total sales $ 620,619 $ 571,614 9 % $ 1,839,173 $ 1,722,892 7 %



Operating income (expense):

Aerospace & $ 30,872 $ 23,880 29 % $ 81,874 $ 65,635 25 %Industrial

Defense Electronics 40,762 35,103 16 % 106,656 83,902 27 %

Naval & Power 35,483 33,367 6 % 116,635 90,623 29 %



Total segments $ 107,117 $ 92,350 16 % $ 305,165 $ 240,160 27 %

Corporate and other (9,448 ) (7,777 ) (21 %) (27,847 ) (27,792 ) 0 %



Total operating $ 97,669 $ 84,573 15 % $ 277,318 $ 212,368 31 %income



Operating margins:

Aerospace & 15.7 % 12.7 % 300 14.2 % 11.1 % 310 bpsIndustrial bps

Defense Electronics 22.5 % 23.7 % (120 20.3 % 19.6 % 70 bps bps)

Naval & Power 14.6 % 14.2 % 40 bps 15.8 % 12.9 % 290 bps

Total Curtiss-Wright 15.7 % 14.8 % 90 bps 15.1 % 12.3 % 280 bps



Segment margins 17.3 % 16.2 % 110 16.6 % 13.9 % 270 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

September 30, 2021 September 30, 2020 2021 vs. 2020

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

Aerospace &Defense markets:

Aerospace $ 116,853 $ - $ 116,853 $ 121,987 $ 748 $ 122,735 (5 %) Defense ^(1)

Ground Defense 55,124 1,080 56,204 20,519 - 20,519 174 % ^(1)

Naval Defense 175,800 - 175,800 165,524 - 165,524 6 %

Commercial 67,461 (381 ) 67,080 70,943 (16,524 ) 54,419 23 % Aerospace ^(2)

TotalAerospace & $ 415,238 $ 699 $ 415,937 $ 378,973 $ (15,776 ) $ 363,197 15 % Defense



Commercial markets:

Power & 112,736 (7,472 ) 105,264 113,919 (5,896 ) 108,023 (3 %) Process ^(3)

General 92,645 - 92,645 78,722 - 78,722 18 % Industrial

Total 205,381 (7,472 ) 197,909 192,641 (5,896 ) 186,745 6 % Commercial



Total $ 620,619 $ (6,773 ) $ 613,846 $ 571,614 $ (21,672 ) $ 549,942 12 % Curtiss-Wright



Nine Months Ended Nine Months Ended

September 30, 2021 September 30, 2020 2021 vs. 2020

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

Aerospace &Defense markets:

Aerospace $ 327,847 $ - $ 327,847 $ 333,120 $ 949 $ 334,069 (2 %) Defense ^(1)

Ground Defense 159,090 3,240 162,330 63,205 - 63,205 157 % ^(1)

Naval Defense 531,429 - 531,429 496,157 - 496,157 7 %

Commercial 196,285 (8,764 ) 187,521 242,708 (46,929 ) 195,779 (4 %) Aerospace ^(2)

TotalAerospace & $ 1,214,651 $ (5,524 ) $ 1,209,127 $ 1,135,190 $ (45,980 ) $ 1,089,210 11 % Defense



Commercial markets:

Power & 343,573 (20,468 ) 323,105 350,632 (18,604 ) 332,028 (3 %) Process ^(3)

General 280,949 - 280,949 237,070 - 237,070 19 % Industrial

Total $ 624,522 $ (20,468 ) $ 604,054 $ 587,702 $ (18,604 ) $ 569,098 6 % Commercial



Total $ 1,839,173 $ (25,992 ) $ 1,813,181 $ 1,722,892 $ (64,584 ) $ 1,658,308 9 % Curtiss-Wright



^(1) Excludes first year purchase accounting adjustments.

^(2) Excludes our build-to-print actuation product line supporting the Boeing737 MAX program which we exited in the fourth quarter of 2020.

^(3) Excludes our German valves business which was classified as held for salein 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; (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 in both periods associated with its acquisitions, 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 in both periods associated with acquisitions, 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, impairment of assets held for sale, foreign currency fluctuations and contributions from acquisitions made during the last twelve months.

Three Months Ended

September 30,

2021 vs. 2020

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

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

Organic 3% 19% (3%) (2%) 3% 11% 1% 7%

Acquisitions 0% 0% 25% 21% 0% 0% 7% 9%

Impairment ofassets held 0% 0% 0% 0% 0% (26%) 0% (10%)for sale

Restructuring 0% 13% 0% 1% 0% 22% 0% 13%

Foreign 1% (3%) 0% (4%) 1% (1%) 1% (4%)Currency

Total 4% 29% 22% 16% 4% 6% 9% 15%



Nine Months Ended

September 30,

2021 vs. 2020

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

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

Organic (5%) 12% (2%) 14% 4% 22% 0% 19%

Acquisitions 0% 0% 25% 16% 0% 0% 6% 6%

Impairment ofassets held 0% 0% 0% 0% 0% (10%) 0% (4%)for sale

Restructuring 0% 14% 0% 4% 0% 18% 0% 13%

Foreign 2% (1%) 0% (7%) 1% (1%) 1% (3%)Currency

Total (3%) 25% 23% 27% 5% 29% 7% 31%

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 net cash 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 Nine Months Ended

September 30, September 30,

2021 2020 2021 2020



Net cash provided by $ 107,285 $ 55,993 $ 155,761 $ 3,784 operating activities

Capital expenditures (10,087 ) (7,017 ) (27,858 ) (36,341 )

Free cash flow $ 97,198 $ 48,976 $ 127,903 $ (32,557 )

Voluntary pension - - - 150,000 contribution

Adjustment to capitalexpenditures (DRG - 437 - 10,112 facility investment)

Restructuring - 5,935 - 10,676

Adjusted free cash flow $ 97,198 $ 55,348 $ 127,903 $ 138,231

Adjusted free cash flow 127 % 75 % 63 % 76 %conversion

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

2021 Chg Low High Low High vs 2020 Adjusted

Sales: Aerospace & $ 805 $ (67 ) $ 738 $ 774 $ 789 $ (14 ) $ - $ 760 $ 775 3 - 5% Industrial Defense 611 - 611 742 756 - 4 745 760 22 - 24% Electronics Naval & 977 (26 ) 951 991 1,011 (31 ) - 960 980 1 - 3% Power Total sales $ 2,393 $ (93 ) $ 2,300 $ 2,507 $ 2,556 $ (45 ) $ 4 $ 2,465 $ 2,515 7 to 9%



Operating income: Aerospace & $ 114 $ (16 ) $ 98 $ 117 $ 120 $ (2 ) $ - $ 115 $ 118 17 - 21% Industrial Defense 144 - 144 153 158 - 6 159 164 10 - 13% Electronics Naval & 171 - 171 166 171 8 - 174 179 2 - 5% Power Total 429 (16 ) 413 436 449 6 6 448 461 segments Corporate (38 ) - (38 ) (37 ) (39 ) - - (37 ) (39 ) and other Total $ 391 $ (16 ) $ 375 $ 398 $ 409 $ 6 $ 6 $ 411 $ 421 9 to 12% operating income

Interest $ (36 ) $ - $ (36 ) $ (40 ) $ (41 ) $ - $ - $ (40 ) $ (41 ) expense Other 21 - 21 13 13 - 3 16 17 income, net Earnings 377 (16 ) 361 372 381 6 9 387 397 before income taxes Provision (88 ) 4 (85 ) (89 ) (92 ) (1 ) (2 ) (93 ) (95 ) for income taxes Net $ 289 $ (12 ) $ 277 $ 283 $ 290 $ 5 $ 7 $ 295 $ 302 earnings

Diluted $ 6.87 $ (0.29 ) $ 6.59 $ 6.91 $ 7.06 $ 0.11 $ 0.17 $ 7.20 $ 7.35 9 to 12% earnings per share Diluted 42.0 42.0 41.0 41.0 41.0 41.0 shares outstanding Effective 23.4 % 23.4 % 24.0 % 24.0 % 24.0 % 24.0 % tax rate

Operating margins: Aerospace & 14.2 % NM 13.3 % 15.1 % 15.2 % - 15.1 % 15.3 % 180 to Industrial +10 bps 200 bps

Defense 23.6 % NM 23.6 % 20.6 % 20.8 % - 21.3 % 21.5 % (210 to Electronics +70 bps 230 bps)

Naval & 17.5 % NM 18.0 % 16.8 % 16.9 % - 18.2 % 18.3 % 20 to 30 Power +140 bps bps

Total 16.3 % NM 16.3 % 15.9 % 16.0 % 16.7 % 16.8 % 40 to 50 operating +60 bps +20 bps bps margin

Free cash $ 394 $ - $ 394 $ 330 $ 360 - - $ 330 $ 360 flowNotes: Full year amounts may not add due to rounding. All financial information by reportable segment for the 2020 and 2021 reporting periods reflects the Corporation's first quarter 2021 segment reorganization.(1) A reconciliation of our 2020 GAAP to our 2020 Non-GAAP Adjusted figures are provided in our February 24, 2021 press release.(2) 2020 Adjusted financials are defined as Reported Sales Operating Income, Operating Margin, Net Income and Diluted EPS under GAAP excluding restructuring costs; first year purchase accounting costs, specifically one-time backlog amortization and transaction costs associated with acquisitions; a non-cash impairment of capitalized development costs related to a commercial aerospace program; one-time transition and IT security costs related to the relocation of the DRG business; and a $10 million non-cash currency translation loss (within non-operating income) related to the liquidation of a foreign legal entity. 2020 financial results excludes our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited, and the results of our German valves business which was classified as held for sale in the fourth quarter of 2020 and resulted in an impairment loss of $33 million.(3) 2021 Adjusted financials are defined as Reported Sales, Operating Income, Operating Margin, Net Income and Diluted EPS under GAAP excluding our build-to-print actuation product line supporting the Boeing 737 MAX program which we exited; the results of our German valves business which was classified as held for sale in the fourth quarter of 2020 and resulted in an additional impairment loss of $9 million; the impact of first year purchase accounting costs, specifically one-time backlog amortization and transaction costs associated with acquisitions; and a one-time, $3 million pension settlement charge related to the retirement of two former executives (within non-operating income).(4) Free Cash Flow is defined as cash flow from operations less capital expenditures. 2020 Adjusted Free Cash Flow guidance excludes a $150 million voluntary contribution made in January to the Company's corporate defined benefit pension plan, a $20 million cash impact from restructuring, and a $10 million capital investment related to the new, state-of-the-art naval facility principally for DRG.Notes: Full year amounts may not add due to rounding. All financialinformation by reportable segment for the 2020 and 2021 reporting periodsreflects the Corporation's first quarter 2021 segment reorganization.(1) A reconciliation of our 2020 GAAP to our 2020 Non-GAAP Adjusted figuresare provided in our February 24, 2021 press release.(2) 2020 Adjusted financials are defined as Reported Sales OperatingIncome, Operating Margin, Net Income and Diluted EPS under GAAP excludingrestructuring costs; first year purchase accounting costs, specificallyone-time backlog amortization and transaction costs associated withacquisitions; a non-cash impairment of capitalized development costsrelated to a commercial aerospace program; one-time transition and ITsecurity costs related to the relocation of the DRG business; and a $10million non-cash currency translation loss (within non-operating income)related to the liquidation of a foreign legal entity. 2020 financialresults excludes our build-to-print actuation product line supporting theBoeing 737 MAX program which we exited, and the results of our Germanvalves business which was classified as held for sale in the fourth quarterof 2020 and resulted in an impairment loss of $33 million.(3) 2021 Adjusted financials are defined as Reported Sales, OperatingIncome, Operating Margin, Net Income and Diluted EPS under GAAP excludingour build-to-print actuation product line supporting the Boeing 737 MAXprogram which we exited; the results of our German valves business whichwas classified as held for sale in the fourth quarter of 2020 and resultedin an additional impairment loss of $9 million; the impact of first yearpurchase accounting costs, specifically one-time backlog amortization andtransaction costs associated with acquisitions; and a one-time, $3 millionpension settlement charge related to the retirement of two formerexecutives (within non-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$10 million capital investment related to the new, state-of-the-art navalfacility principally for DRG. CURTISS-WRIGHT CORPORATION 2021 Sales Growth Guidance by End Market As of November 3, 2021 2021 % Change vs 2020

Aerospace & Defense Markets Current % Total Sales

Aerospace Defense 2 - 4% 19%

Ground Defense 100 - 105% 9%

Naval Defense 0 - 2% 28%

Commercial Aerospace Flat 10%

Total Aerospace & Defense 7 - 9% 66%



Commercial Markets

Power & Process 1 - 3% 18%

General Industrial 15 - 17% 15%

Total Commercial 6 - 8% 34%



Total Curtiss-Wright Sales 7 - 9% 100%

Note: Amounts may not add due to rounding. (1) This table reflects the Company's first quarter 2021 End Market Structure and Realignment, where all Commercial Aerospace market revenues shifted into a newly 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 Vehicles and b) Industrial Automation and Services. (3) Based on these changes, all of our general industrial businesses operate within the Aerospace & Industrial segment, and the majority of the Company's nuclear 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, visit www.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/20211103006172/en/

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