Content Detail

• Content META

  Title	Ducommun Incorporated Reports Third Quarter 2024 Results
  ID	4413905
  External ID	7281982460
  Author	Unknown
  Published Date	Nov. 7, 2024, 5:06 a.m.
  Summary	COSTA MESA, Calif. , Nov. 07, 2024 (GLOBE NEWSWIRE) -- Ducommun Incorporated (NYSE: DCO) (“Ducommun” or the “Company”) today reported results for its third quarter ended September 28, 2024 . Third Qu
  Tags	press-release
  URL	https://www.marketscreener.com/quote/stock/ducommun-incorporated-12264/news/ducommun-incorporated-reports-third-quarter-2024-results-48288408/
  Sentiment	Negative: 0.02119    Neutral: 0.02312    Positive: 0.95569
  Relevance	0.01596

• Content Details

  Content ID	2631380
  Key	feef2f69-2bed-4c24-992f-08eb17dc051e
  Content	COSTA MESA, Calif. , Nov. 07, 2024 (GLOBE NEWSWIRE) -- Ducommun Incorporated (NYSE: DCO) (“Ducommun” or the “Company”) today reported results for its third quarter ended September 28, 2024 . Third Quarter 2024 Recap Net revenue was $201.4 million , an increase of 2.6% over Q3 2023 , an increase of 2.6% over Q3 2023 Net income of $10.1 million (increase of 216% year-over-year), or $0.67 per diluted share, or 5.0% of revenue, up 340 bps year-over-year (increase of 216% year-over-year), or per diluted share, or 5.0% of revenue, up 340 bps year-over-year Non-GAAP adjusted net income of $14.8 million (increase of 44% year-over-year), or $0.99 per diluted share (increase of 44% year-over-year), or per diluted share Gross margin of 26.2%, year-over-year growth of 350 bps Adjusted EBITDA of $31.9 million (increase of 9% year-over-year), or 15.8% of revenue, up 90 bps year-over-year “VISION 2027 again this quarter is taking hold in many areas and especially in our margin growth, as our mix of Engineered Products and Aftermarket revenue continues to climb as a percentage of revenue. Q3 was another outstanding quarter for DCO as we once again grew our topline both year-over-year and sequentially, led by strength in both of our Military and Commercial Aerospace segments along with strong quarterly gross margins and Adjusted EBITDA margins,” said Stephen G. Oswald , chairman, president and chief executive officer. “Net revenue for the quarter exceeded $200 million for the first time in our history to $201.4 million , up 3% compared to Q3 2023, with strong demand for select military radar, missile and electronic warfare programs, Airbus platforms and business jets, despite the temporary slowdown in demand on Boeing platforms. "The Company delivered a new quarterly record for gross margin, expanding 350 bps year-over-year from 22.7% to 26.2%, a very impressive result. Ducommun also reached a new quarterly record for Adjusted EBITDA margins, exceeding $30 million for the first time, expanding 90 bps year-over-year from 14.9% to 15.8%. The Adjusted EBITDA margins growth in Q3 reaffirms the strong momentum we have in meeting our VISION 2027 financial goal of 18%. There were many bright spots in Q3 including continued growth in our higher margin Engineered Products businesses, benefits of favorable product mix and higher manufacturing volume, savings from our on-going restructuring program, value pricing along with productivity and a relentless culture, all critical to our success. DCO is now clearly in position to close out its 175th year in business with its best one yet. “In December 2022 , we laid out our VISION 2027 Plan to investors and as we are now almost through year two of the Plan and by year end will be ahead of schedule. The DCO team is driving the business and despite the continued headwinds from aircraft OEMs, including the labor strike at Boeing that ended this week, remains on track to deliver our long-term goals as we drive to meet our commitments.” Third Quarter Results Net revenue for the third quarter of 2024 was $201.4 million compared to $196.3 million for the third quarter of 2023. The year-over-year increase of 2.6% was primarily due to the following in the Company's key end-use markets: $6.6 million higher revenue in the Company’s military and space end-use markets due to higher rates on selected radar, electronic warfare, and other military and space platforms, partially offset by lower rates on rotary-wing and fixed-wing aircraft platforms; and higher revenue in the Company’s military and space end-use markets due to higher rates on selected radar, electronic warfare, and other military and space platforms, partially offset by lower rates on rotary-wing and fixed-wing aircraft platforms; and $2.8 million higher revenue in the Company’s commercial aerospace end-use markets due to growth in Airbus and selected business aircraft platforms, partially offset by lower revenues on the 737 MAX and in-flight entertainment products. In addition, revenue for the Company’s industrial end-use markets for the third quarter of 2024 decreased $4.3 million compared to the third quarter of 2023 mainly due to the Company selectively pruning non-core business. Net income for the third quarter of 2024 was $10.1 million , or 5.0% of revenue, or $0.67 per diluted share, compared to $3.2 million , or 1.6% revenue, or $0.22 per diluted share, for the third quarter of 2023. This reflects higher gross profit of $8.1 million and lower restructuring charges of $2.1 million (including $0.2 million recorded as cost of sales in the prior year period), partially offset by higher selling, general and administrative (“SG&A”) expenses of $3.3 million . A portion of the higher SG&A expenses were due to the unsolicited non-binding offer to acquire all common stock outstanding of Ducommun Incorporated . Gross profit for the third quarter of 2024 was $52.7 million , or 26.2% of revenue, compared to gross profit of $44.6 million , or 22.7% of revenue, for the third quarter of 2023. The increase in gross profit as a percentage of net revenue year-over-year was primarily due to favorable product mix and higher manufacturing volume, pricing actions, along with benefits from the restructuring initiative, partially offset by higher other manufacturing costs. Operating income for the third quarter of 2024 was $15.3 million , or 7.6% of revenue, compared to $8.6 million , or 4.4% of revenue, in the comparable period last year. The year-over-year increase of $6.7 million was primarily due to higher gross profit and lower restructuring charges, partially offset by higher SG&A expenses, which was noted above. Non-GAAP adjusted operating income for the third quarter of 2024 was $21.1 million , or 10.5% of revenue, compared to $17.5 million , or 8.9% of revenue, in the comparable period last year. The year-over-year increase was primarily due to higher GAAP operating income, partially offset by lower add backs of restructuring charges and inventory purchase accounting adjustments. Adjusted EBITDA for the third quarter of 2024 was $31.9 million , or 15.8% of revenue, compared to $29.3 million , or 14.9% of revenue, for the comparable period in 2023. Interest expense for the third quarter of 2024 was $3.8 million compared to $5.4 million in the comparable period of 2023. The year-over-year decrease was primarily due to the benefit from the interest rate swaps which became effective on January 1, 2024 , along with a lower debt balance in the third quarter of 2024. During the third quarter of 2024, the net cash provided by operations was $13.9 million compared to $14.3 million during the third quarter of 2023. The lower net cash provided by operations during the third quarter of 2024 was primarily due to lower contract liabilities and higher contract assets, partially offset by lower inventories and higher net income. Business Segment Information Electronic Systems Electronic Systems segment net revenue for the quarter ended September 28, 2024 was $115.4 million , compared to $110.7 million for the third quarter of 2023. The year-over-year increase was primarily due to the following in the Company's key end-use markets: $9.9 million higher revenue within the Company’s military and space end-use markets due to higher rates on select radar, electronic warfare, and other military and space platforms, partially offset by lower rates on fixed-wing aircraft platforms; partially offset by higher revenue within the Company’s military and space end-use markets due to higher rates on select radar, electronic warfare, and other military and space platforms, partially offset by lower rates on fixed-wing aircraft platforms; partially offset by $0.9 million lower revenue in the Company’s commercial aerospace end-use markets due to lower in-flight entertainment revenues and lower rates on other commercial aerospace platforms, partially offset by higher rates on regional and business aircraft selected single-aisle and twin-aisle aircraft platforms. In addition, revenue for the Company’s industrial end-use markets for the third quarter of 2024 decreased $4.3 million compared to the third quarter of 2023 mainly due to the Company selectively pruning non-core business. Electronic Systems segment operating income for the quarter ended September 28, 2024 was $18.9 million , or 16.4% of revenue, compared to $12.7 million , or 11.5% of revenue, for the comparable quarter in 2023. The year-over-year increase of $6.2 million was primarily due to favorable product mix, higher manufacturing volume, pricing actions, and lower restructuring charges, partially offset by higher other manufacturing costs. Non-GAAP adjusted operating income for the third quarter of 2024 was $19.4 million , or 16.8% of revenue, compared to $14.9 million , or 13.4% of revenue, in the comparable period last year. Structural Systems Structural Systems segment net revenue for the quarter ended September 28, 2024 was $86.0 million , compared to $85.5 million for the third quarter of 2023. The year-over-year increase was primarily due to the following: $3.7 million higher revenue within the Company’s commercial aerospace end-use markets due to growth in Airbus and selected business jet platforms; partially offset by higher revenue within the Company’s commercial aerospace end-use markets due to growth in Airbus and selected business jet platforms; partially offset by $3.3 million lower revenue within the Company’s military and space end-use markets due to lower rates on rotary-wing aircraft and other military and space platforms, partially offset by higher rates on fixed-wing aircraft platforms. Structural Systems segment operating income for the quarter ended September 28, 2024 was $8.3 million , or 9.6% of revenue, compared to $6.7 million , or 7.9% of revenue, for the comparable quarter in 2023. The year-over-year increase of $1.5 million was primarily due to favorable product mix, pricing actions, and lower inventory purchase accounting adjustments. Non-GAAP adjusted operating income for the third quarter of 2024 was $12.6 million , or 14.7% of revenue, compared to $13.5 million , or 15.7% of revenue, in the comparable period last year. Corporate General and Administrative (“CG&A”) Expenses CG&A expenses for the third quarter of 2024 were $11.9 million , or 5.9% of total Company revenue, compared to $10.8 million , or 5.5% of total Company revenue, for the comparable quarter in the prior year. The year-over-year increase in CG&A expenses was primarily due to higher professional services fees of $1.2 million , of which $1.0 million was related to the unsolicited non-binding offer to acquire all the shares of Ducommun Incorporated . Leadership and Board Updates In a separate press release, the Company appointed two new independent directors, Daniel G. Korte and Daniel L. Boehle , to the Board. Conference Call A teleconference hosted by Stephen G. Oswald , the Company’s chairman, president and chief executive officer, and Suman B. Mookerji , the Company’s senior vice president, chief financial officer will be held today, November 7, 2024 at 10:00 a.m. PT ( 1:00 p.m. ET ) to review these financial results. To access the conference call, please pre-register using the following registration link: https://register.vevent.com/register/BIdf06696d244b40238cb113c5156c0317 Registrants will receive a confirmation with dial-in details. Mr. Oswald and Mr. Mookerji will be speaking on behalf of the Company and anticipate the call (including Q&A) to last approximately 45 minutes. A live webcast of the event can be accessed using the link above. A replay of the webcast will be available on the Ducommun website at Ducommun.com. Additional information regarding Ducommun's results can be found in the Q3 2024 Earnings Presentation available at Ducommun.com. About Ducommun Incorporated Ducommun Incorporated delivers value-added innovative manufacturing solutions to customers in the aerospace, defense and industrial markets. Founded in 1849, the Company specializes in two core areas - Electronic Systems and Structural Systems - to produce complex products and components for commercial aircraft platforms, mission-critical military and space programs, and sophisticated industrial applications. For more information, visit Ducommun.com. Forward Looking Statements This press release and any attachments include “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, in particular, any statements about the Company's VISION 2027 Strategy and its progress towards the goals stated therein, as well as expectations relating to the Company's full year 2024 results. The Company generally uses the words “may,” “will,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “plan,” “intend,” “continue” and similar expressions in this press release and any attachments to identify forward-looking statements. The Company bases these forward-looking statements on its current views with respect to future events and financial performance. Actual results could differ materially from those projected in the forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions, including, among other things: whether the anticipated pre-tax restructuring charges will be sufficient to address all anticipated restructuring costs, including related to employee separation, facilities consolidation, inventory write-down and other asset impairments; whether the expected cost savings from the restructuring will ultimately be obtained in the amount and during the period anticipated; whether the restructuring in the affected areas will be sufficient to build a more cost efficient, focused, higher margin enterprise with higher returns for the Company's shareholders; the strength of the real estate market, the duration of any lease entered into as part of any sale-leaseback transaction, the amount of commissions owed to brokers, and applicable tax rates; the impact of the Company’s debt service obligations and restrictive debt covenants; the Company’s end-use markets are cyclical; the Company depends upon a selected base of industries and customers; a significant portion of the Company’s business depends upon U.S. Government defense spending; the Company is subject to extensive regulation and audit by the Defense Contract Audit Agency ; contracts with some of the Company’s customers contain provisions which give the its customers a variety of rights that are unfavorable to the Company; further consolidation in the aerospace industry could adversely affect the Company’s business and financial results; the Company’s ability to successfully make acquisitions, including its ability to successfully integrate, operate or realize the projected benefits of such businesses; the Company relies on its suppliers to meet the quality and delivery expectations of its customers; the Company uses estimates when bidding on fixed-price contracts which estimates could change and result in adverse effects on its financial results; the impact of existing and future laws and regulations; the impact of existing and future accounting standards and tax rules and regulations; environmental liabilities could adversely affect the Company’s financial results; cyber security attacks, internal system or service failures may adversely impact the Company’s business and operations; the ultimate geographic spread, duration and severity of the coronavirus (COVID-19) outbreak, and the effectiveness of actions taken, or actions that may be taken, by governmental authorities to contain the outbreak or treat its impact, and other risks and uncertainties, including those detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission . You should not put undue reliance on any forward-looking statements. You should understand that many important factors, including those discussed herein, could cause the Company’s results to differ materially from those expressed or suggested in any forward-looking statement. Except as required by law, the Company does not undertake any obligation to update or revise these forward-looking statements to reflect new information or events or circumstances that occur after the date of this news release, November 7, 2024 , or to reflect the occurrence of unanticipated events or otherwise. Readers are advised to review the Company’s filings with the Securities and Exchange Commission (which are available from the SEC’s EDGAR database at www.sec.gov). Note Regarding Non-GAAP Financial Information This release contains non-GAAP financial measures, including Adjusted EBITDA (which excludes interest expense, income tax expense, depreciation, amortization, stock-based compensation expense, restructuring charges, professional fees related to unsolicited non-binding acquisition offer, Guaymas fire related expenses, other fire related expenses, insurance recoveries related to loss on operating assets, insurance recoveries related to business interruption, and inventory purchase accounting adjustments), including as a percentage of revenue, non-GAAP operating income, including as a percentage of net revenues, non-GAAP net income, non-GAAP earnings per share, and backlog. In addition, certain other prior period amounts have been reclassified to conform to current year’s presentation. The Company believes the presentation of these non-GAAP measures provide important supplemental information to management and investors regarding financial and business trends relating to its financial condition and results of operations. The Company’s management uses these non-GAAP financial measures along with the most directly comparable GAAP financial measures in evaluating the Company’s actual and forecasted operating performance, capital resources and cash flow. The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The Company discloses different non-GAAP financial measures in order to provide greater transparency and to help the Company’s investors to more meaningfully evaluate and compare Ducommun’s results to its previously reported results. The non-GAAP financial measures that the Company uses may not be comparable to similarly titled financial measures used by other companies. The Company defines backlog as potential revenue and is based on customer placed purchase orders and long-term agreements (“LTAs”) with firm fixed price and expected delivery dates of 24 months or less. The majority of the LTAs do not meet the definition of a contract under ASC 606 and thus, the backlog amount disclosed herein is greater than the remaining performance obligations disclosed under ASC 606. Backlog is subject to delivery delays or program cancellations, which are beyond the Company’s control. Backlog is affected by timing differences in the placement of customer orders and tends to be concentrated in several programs to a greater extent than the Company’s net revenues. As a result of these factors, trends in the Company’s overall level of backlog may not be indicative of trends in the Company’s future net revenues. CONTACT: Suman Mookerji , Senior Vice President, Chief Financial Officer, 657.335.3665 DUCOMMUN INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Dollars in thousands) September 28 , 2024 December 31 , 2023 Assets Current Assets Cash and cash equivalents $ 37,266 $ 42,863 Accounts receivable, net 107,730 104,692 Contract assets 221,434 177,686 Inventories 185,773 199,201 Production cost of contracts 5,650 7,778 Other current assets 12,507 17,349 Total Current Assets 570,360 549,569 Property and Equipment, Net 109,652 111,379 Operating Lease Right-of-Use Assets 30,613 29,513 Goodwill 244,600 244,600 Intangibles, Net 153,779 166,343 Deferred income taxes 5,107 641 Other Assets 15,806 18,874 Total Assets $ 1,129,917 $ 1,120,919 Liabilities and Shareholders’ Equity Current Liabilities Accounts payable $ 75,430 $ 72,265 Contract liabilities 36,875 53,492 Accrued and other liabilities 46,126 42,260 Operating lease liabilities 8,328 7,873 Current portion of long-term debt 10,938 7,813 Total Current Liabilities 177,697 183,703 Long-Term Debt, Less Current Portion 245,988 256,961 Non-Current Operating Lease Liabilities 23,361 22,947 Deferred Income Taxes 496 4,766 Other Long-Term Liabilities 16,803 16,448 Total Liabilities 464,345 484,825 Commitments and Contingencies Shareholders’ Equity Common Stock 148 146 Additional Paid-In Capital 213,471 206,197 Retained Earnings 446,701 421,980 Accumulated Other Comprehensive Income 5,252 7,771 Total Shareholders’ Equity 665,572 636,094 Total Liabilities and Shareholders’ Equity $ 1,129,917 $ 1,120,919 DUCOMMUN INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) Three Months Ended Nine Months Ended September 28 , 2024 September 30 , 2023 September 28 , 2024 September 30 , 2023 Net Revenues $ 201,412 $ 196,250 $ 589,259 $ 564,761 Cost of Sales 148,736 151,648 438,401 443,270 Gross Profit 52,676 44,602 150,858 121,491 Selling, General and Administrative Expenses 35,486 32,182 104,498 88,755 Restructuring Charges 1,924 3,811 4,548 12,750 Operating Income 15,266 8,609 41,812 19,986 Interest Expense (3,829 ) (5,370 ) (11,687 ) (15,324 ) Other Income — — — 7,945 Income Before Taxes 11,437 3,239 30,125 12,607 Income Tax Expense 1,289 26 5,404 1,789 Net Income $ 10,148 $ 3,213 $ 24,721 $ 10,818 Earnings Per Share Basic earnings per share $ 0.69 $ 0.22 $ 1.68 $ 0.81 Diluted earnings per share $ 0.67 $ 0.22 $ 1.65 $ 0.79 Weighted-Average Number of Common Shares Outstanding Basic 14,806 14,625 14,758 13,408 Diluted 15,039 14,814 14,981 13,661 Gross Profit % 26.2 % 22.7 % 25.6 % 21.5 % SG&A % 17.6 % 16.4 % 17.7 % 15.7 % Operating Income % 7.6 % 4.4 % 7.1 % 3.5 % Net Income % 5.0 % 1.6 % 4.2 % 1.9 % Effective Tax Rate 11.3 % 0.8 % 17.9 % 14.2 % DUCOMMUN INCORPORATED AND SUBSIDIARIES GAAP TO NON-GAAP NET INCOME TO ADJUSTED EBITDA RECONCILIATION (Unaudited) (Dollars in thousands) Three Months Ended Nine Months Ended September 28 , 2024 September 30 , 2023 September 28 , 2024 September 30 , 2023 GAAP net income $ 10,148 $ 3,213 $ 24,721 $ 10,818 Non-GAAP Adjustments: Interest expense 3,829 5,370 11,687 15,324 Income tax expense 1,289 26 5,404 1,789 Depreciation 4,285 4,020 12,339 11,692 Amortization 4,246 4,458 12,790 12,729 Stock-based compensation expense (1) 4,467 5,652 12,753 13,769 Restructuring charges (2) 1,924 3,999 5,405 12,938 Professional fees related to unsolicited non-binding acquisition offer 1,033 — 2,407 — Guaymas fire related expenses — 548 — 3,896 Other fire related expenses — — — 477 Insurance recoveries related to loss on operating assets — — — (5,563 ) Insurance recoveries related to business interruption — — — (2,160 ) Inventory purchase accounting adjustments 663 2,041 1,745 2,807 Adjusted EBITDA $ 31,884 $ 29,327 $ 89,251 $ 78,516 Net income as a % of net revenues 5.0 % 1.6 % 4.2 % 1.9 % Adjusted EBITDA as a % of net revenues 15.8 % 14.9 % 15.1 % 13.9 % (1) The three and nine months ended September 28, 2024 included $0.9 million and $2.8 million , respectively, of stock-based compensation expense for awards with both performance and market conditions that will be settled in cash. The three and nine months ended September 30, 2023 included $1.4 million and $2.7 million , respectively, of stock-based compensation expense for awards with both performance and market conditions that will be settled in cash. The three and nine months ended September 28, 2024 included $0.1 million and $0.3 million , respectively, of stock-based compensation expense recorded as cost of sales. The three and nine months ended September 30, 2023 included $0.1 million and $0.3 million , respectively, of stock-based compensation expense recorded as cost of sales. (2) The three and nine months ended September 28, 2024 included zero and $0.9 million , respectively, of restructuring charges that were recorded as cost of sales. The three and nine months ended September 30, 2023 each included $0.2 million of restructuring charges that were recorded as cost of sales. DUCOMMUN INCORPORATED AND SUBSIDIARIES BUSINESS SEGMENT PERFORMANCE (Unaudited) (Dollars in thousands) Three Months Ended Nine Months Ended % Change September 28 , 2024 September 30 , 2023 % of Net Revenues 2024 % of Net Revenues 2023 % Change September 28 , 2024 September 30 , 2023 % of Net Revenues 2024 % of Net Revenues 2023 Net Revenues Electronic Systems 4.2 % $ 115,412 $ 110,707 57.3 % 56.4 % 0.3 % $ 324,391 $ 323,457 55.1 % 57.3 % Structural Systems 0.5 % 86,000 85,543 42.7 % 43.6 % 9.8 % 264,868 241,304 44.9 % 42.7 % Total Net Revenues 2.6 % $ 201,412 $ 196,250 100.0 % 100.0 % 4.3 % $ 589,259 $ 564,761 100.0 % 100.0 % Segment Operating Income Electronic Systems $ 18,910 $ 12,710 16.4 % 11.5 % $ 54,685 $ 32,249 16.9 % 10.0 % Structural Systems 8,289 6,743 9.6 % 7.9 % 21,716 16,873 8.2 % 7.0 % 27,199 19,453 76,401 49,122 Corporate General and Administrative Expenses (1) (11,933 ) (10,844 ) (5.9) % (5.5) % (34,589 ) (29,136 ) (5.9) % (5.2) % Total Operating Income $ 15,266 $ 8,609 7.6 % 4.4 % $ 41,812 $ 19,986 7.1 % 3.5 % Adjusted EBITDA Electronic Systems Operating Income $ 18,910 $ 12,710 $ 54,685 $ 32,249 Other Income — — — 222 Depreciation and Amortization 3,575 3,567 10,869 10,626 Stock-Based Compensation Expense (2) 70 124 241 348 Restructuring Charges 91 1,794 562 5,739 22,646 18,195 19.6 % 16.4 % 66,357 49,184 20.5 % 15.2 % Structural Systems Operating Income 8,289 6,743 21,716 16,873 Depreciation and Amortization 4,849 4,852 14,058 13,619 Stock-Based Compensation Expense (3) 105 97 261 280 Restructuring Charges 1,833 2,205 4,843 7,113 Guaymas fire related expenses — 548 — 3,896 Other fire related expenses — — — 477 Inventory Purchase Accounting Adjustments 663 2,041 1,745 2,807 15,739 16,486 18.3 % 19.3 % 42,623 45,065 16.1 % 18.7 % Corporate General and Administrative Expenses (1) Operating loss (11,933 ) (10,844 ) (34,589 ) (29,136 ) Depreciation and Amortization 107 59 202 176 Stock-Based Compensation Expense (4) 4,292 5,431 12,251 13,141 Restructuring Charges — — — 86 Professional Fees Related to Unsolicited Non-Binding Acquisition Offer 1,033 — 2,407 — (6,501 ) (5,354 ) (19,729 ) (15,733 ) Adjusted EBITDA $ 31,884 $ 29,327 15.8 % 14.9 % $ 89,251 $ 78,516 15.1 % 13.9 % Capital Expenditures Electronic Systems $ 1,011 $ 978 $ 2,950 $ 4,752 Structural Systems 1,295 3,802 4,172 11,043 Corporate Administration — — 3,024 — Total Capital Expenditures $ 2,306 $ 4,780 $ 10,146 $ 15,795 (1) Includes costs not allocated to either the Electronic Systems or Structural Systems operating segments. (2) The three and nine months ended September 28, 2024 each included $0.1 million of stock-based compensation expense recorded as cost of sales. The three and nine months ended September 30, 2023 included less than $0.1 million and $0.1 million , respectively, of stock-based compensation expense recorded as cost of sales. (3) The three and nine months ended September 28, 2024 included $0.1 million and $0.2 million , respectively, of stock-based compensation expense recorded as cost of sales. The three and nine months ended September 30, 2023 included $0.1 million and $0.2 million , respectively, of stock-based compensation expense recorded as cost of sales. (4) The three and nine months ended September 28, 2024 included $0.9 million and $2.8 million , respectively, of stock-based compensation expense for awards with both performance and market conditions that will be settled in cash. The three and nine months ended September 30, 2023 included $1.4 million and $2.7 million , respectively, of stock-based compensation expense for awards with both performance and market conditions that will be settled in cash. DUCOMMUN INCORPORATED AND SUBSIDIARIES GAAP TO NON-GAAP OPERATING INCOME RECONCILIATION (Unaudited) (Dollars in thousands) Three Months Ended Nine Months Ended GAAP To Non-GAAP Operating Income September 28, 2024 September 30, 2023 % of Net Revenues 2024 % of Net Revenues 2023 September 28, 2024 September 30, 2023 % of Net Revenues 2024 % of Net Revenues 2023 GAAP operating income $ 15,266 $ 8,609 $ 41,812 $ 19,986 GAAP operating income - Electronic Systems $ 18,910 $ 12,710 $ 54,685 $ 32,249 Adjustments to GAAP operating income - Electronic Systems: Other income — — — 222 Restructuring charges 91 1,794 562 5,739 Amortization of acquisition-related intangible assets 373 373 1,120 1,120 Total adjustments to GAAP operating income - Electronic Systems 464 2,167 1,682 7,081 Non-GAAP adjusted operating income - Electronic Systems 19,374 14,877 16.8 % 13.4 % 56,367 39,330 17.4 % 12.2 % GAAP operating income - Structural Systems 8,289 6,743 21,716 16,873 Adjustments to GAAP operating income - Structural Systems: Restructuring charges 1,833 2,205 4,843 7,113 Guaymas fire related expenses — 548 — 3,896 Other fire related expenses — — — 477 Inventory purchase accounting adjustments 663 2,041 1,745 2,807 Amortization of acquisition-related intangible assets 1,859 1,935 5,578 4,873 Total adjustments to GAAP operating income - Structural Systems 4,355 6,729 12,166 19,166 Non-GAAP adjusted operating income - Structural Systems 12,644 13,472 14.7 % 15.7 % 33,882 36,039 12.8 % 14.9 % GAAP operating loss - Corporate (11,933 ) (10,844 ) (34,589 ) (29,136 ) Adjustments to GAAP Operating Income - Corporate Restructuring charges — — — 86 Professional fees related to unsolicited non-binding acquisition offer 1,033 — 2,407 — Total adjustments to GAAP Operating Income - Corporate 1,033 — 2,407 86 Non-GAAP adjusted operating loss - Corporate (10,900 ) (10,844 ) (32,182 ) (29,050 ) Total non-GAAP adjustments to GAAP operating income 5,852 8,896 16,255 26,333 Non-GAAP adjusted operating income $ 21,118 $ 17,505 10.5 % 8.9 % $ 58,067 $ 46,319 9.9 % 8.2 % DUCOMMUN INCORPORATED AND SUBSIDIARIES GAAP TO NON-GAAP NET INCOME AND EARNINGS PER SHARE RECONCILIATION (Unaudited) (Dollars in thousands, except per share amounts) Three Months Ended Nine Months Ended GAAP To Non-GAAP Net Income September 28 , 2024 September 30 , 2023 September 28 , 2024 September 30 , 2023 GAAP net income $ 10,148 $ 3,213 $ 24,721 $ 10,818 Adjustments to GAAP net income: Restructuring charges 1,924 3,999 5,405 12,938 Professional fees related to unsolicited non-binding acquisition offer 1,033 — 2,407 — Guaymas fire related expenses — 548 — 3,896 Other fire related expenses — — — 477 Insurance recoveries related to loss on operating assets — — — (5,563 ) Insurance recoveries related to business interruption — — — (2,160 ) Inventory purchase accounting adjustments 663 2,041 1,745 2,807 Amortization of acquisition-related intangible assets 2,232 2,308 6,698 5,993 Total adjustments to GAAP net income before provision for income taxes 5,852 8,896 16,255 18,388 Income tax effect on non-GAAP adjustments (1) (1,170 ) (1,779 ) (3,251 ) (3,677 ) Non-GAAP adjusted net income $ 14,830 $ 10,330 $ 37,725 $ 25,529 Three Months Ended Nine Months Ended GAAP Earnings Per Share To Non-GAAP Earnings Per Share September 28 , 2024 September 30 , 2023 September 28 , 2024 September 30 , 2023 GAAP diluted earnings per share (“EPS”) $ 0.67 $ 0.22 $ 1.65 $ 0.79 Adjustments to GAAP diluted EPS: Restructuring charges 0.13 0.27 0.36 0.95 Professional fees related to unsolicited non-binding acquisition offer 0.07 — 0.16 — Guaymas fire related expenses — 0.04 — 0.29 Other fire related expenses — — — 0.03 Insurance recoveries related to loss on operating assets — — — (0.41 ) Insurance recoveries related to business interruption — — — (0.16 ) Inventory purchase accounting adjustments 0.05 0.14 0.12 0.21 Amortization of acquisition-related intangible assets 0.15 0.15 0.45 0.44 Total adjustments to GAAP diluted EPS before provision for income taxes 0.40 0.60 1.09 1.35 Income tax effect on non-GAAP adjustments (1) (0.08 ) (0.12 ) (0.22 ) (0.27 ) Non-GAAP adjusted diluted EPS $ 0.99 $ 0.70 $ 2.52 $ 1.87 Shares used for non-GAAP adjusted diluted EPS 15,039 14,814 14,981 13,661 (1) Effective tax rate of 20.0% used for both 2024 and 2023 adjustments. DUCOMMUN INCORPORATED AND SUBSIDIARIES NON-GAAP BACKLOG* BY REPORTING SEGMENT (Unaudited) (Dollars in thousands) September 28 , 2024 December 31 , 2023 Consolidated Ducommun Military and space $ 591,642 $ 527,143 Commercial aerospace 430,743 429,494 Industrial 21,528 36,931 Total $ 1,043,913 $ 993,568 Electronic Systems Military and space $ 459,770 $ 397,681 Commercial aerospace 80,405 87,994 Industrial 21,528 36,931 Total $ 561,703 $ 522,606 Structural Systems Military and space $ 131,872 $ 129,462 Commercial aerospace 350,338 341,500 Total $ 482,210 $ 470,962 * Under ASC 606, the Company defines performance obligations as customer placed purchase orders with firm fixed price and firm delivery dates. The remaining performance obligations disclosed under ASC 606 as of September 28, 2024 were $957.0 million . The Company defines backlog as potential revenue and is based on customer placed purchase orders and long-term agreements (“LTAs”) with firm fixed price and expected delivery dates of 24 months or less. Backlog as of September 28, 2024 was $1,043.9 million compared to $993.6 million as of December 31, 2023 . Ducommun Incorporated Source:
  Content Reference URL	None

• Publisher

  Publisher Name	MarketScreener (#4446)
  Publisher URL	http://www.marketscreener.com
  Description	None
  Trust Flow Score	23
  Citation Flow Score	26

• Data Source

  Data Source Name	Quantexa News (#5)
  Data Source Type	news
  Data Source URL	https://app.aylien.com/dashboard
  Description	Welcome to Quantexa News API — the most powerful way to aggregate, filter, and integrate global news data into your apps and models.
  Weight	10