V2X Delivers First Quarter Results and Reaffirms Full-Year Guidance
PR Newswire
RESTON, Va., May 5, 2025
First Quarter Highlights
-- Revenue of $1.02 billion with +10% y/y growth in Indo-Pacific region
-- Net income of $8.1 million; Adjusted net income1 of $31.5 million, up 10%
y/y
-- Adjusted EBITDA1 of $67.0 million, with a margin of 6.6%
-- Diluted EPS of $0.25; Adjusted diluted EPS1 of $0.98, up 9% y/y
-- Enhanced capital structure to generate interest expense savings and cash
flow
-- Notable progress on new Foreign Military and International Sales
opportunities
RESTON, Va., May 5, 2025 /PRNewswire/ -- V2X, Inc. $(VVX)$ announced first quarter 2025 financial results.
"The overall trends in our market remain positive and are being driven by customer requirements to improve deterrence, enhance readiness, and strengthen national security," said Jeremy C. Wensinger, President and Chief Executive Officer. "We are performing well as V2X possesses the unique full lifecycle, mission driven solutions to deliver on these requirements. The V2X value proposition is being recognized by customers and is demonstrated by our recent wins and extensions, which provide substantial visibility for the next several years."
Mr. Wensinger continued, "V2X is in an enviable position with strong visibility, differentiated capabilities, and a robust geographic footprint. We are capitalizing on this position by increasing bid velocity. Additionally, the foreign military sales and international markets continue to represent a large and growing addressable opportunity to deliver more solutions across locations in which we already operate. These customers know V2X, they trust V2X, and see the benefit of our solutions. Our focused engagement strategy and visible presence is yielding substantial traction on several nearer-term opportunities that align exactly to our core capabilities."
Mr. Wensinger concluded, "We continue to execute in a dynamic market, bringing the whole of V2X to meet our customers critical mission requirements. It's our employees that make this possible and I'd like to recognize their commitment and contributions."
First Quarter 2025 Results
"V2X reported revenue of $1.02 billion in the quarter, with 10% year-over-year growth in the Indo-Pacific region," said Shawn Mural, Senior Vice President and Chief Financial Officer. "We are pleased with our performance and start to the year, particularly in light of the overall market environment. We remain on track to achieve our commitments and are confident in the strength and resiliency of our business model that generates strong, predictable cash flow."
"For the quarter, the Company reported operating income of $34.3 million and adjusted operating income(1) of $61.5 million. V2X delivered adjusted EBITDA(1) of $67.0 million, with a margin of 6.6%. Net income for the quarter was $8.1 million dollars, up from $1.1 million dollars from the prior year. Adjusted net income(1) was $31.5 million dollars, increasing 10% year-over-year. First quarter GAAP diluted EPS was $0.25. Adjusted diluted EPS(1) for the quarter was $0.98, increasing 9% year-over-year."
Mr. Mural continued, "During the quarter we continued to demonstrate our steadfast commitment to increasing shareholder value by making further enhancements to our capital structure. Our strong fundamental profile and consistent financial performance created a compelling opportunity to reprice and extend both our revolver and Term Loan A."
Reaffirming 2025 Guidance
Mr. Mural concluded, "The trends and demand signals in our business remain positive and we believe our strategy, visibility, and targeted growth opportunities will yield value creation. Given our performance in the first quarter and current trends, the Company is reaffirming guidance for 2025."
Guidance is as follows:
$ millions, except for per share amounts 2025 Guidance 2025 Mid-Point ------------------------------------------- --------------- -------------- Revenue $4,375 $4,500 $4,438 Adjusted EBITDA(1) $305 $320 $313 Adjusted Diluted Earnings Per Share(1) $4.45 $4.85 $4.65 Adjusted Net Cash Provided by Operating Activities(1) $150 $170 $160 ------------------------------------------- ------- ------ --------------
The Company is not providing a quantitative reconciliation with respect to the foregoing forward-looking non-GAAP measures in reliance on the "unreasonable efforts" exception set forth in SEC rules because certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated. For example, unusual, one-time, non-ordinary, or non-recurring costs, which relate to M&A, integration and related activities cannot be reasonably estimated. Forward-looking statements are based upon current expectations and are subject to factors that could cause actual results to differ materially from those suggested here, including those factors set forth in the Safe Harbor Statement below.
First Quarter Conference Call
Management will conduct a conference call with analysts and investors at 4:30 p.m. ET on Monday, May 5, 2025. U.S.-based participants may dial in to the conference call at 877-300-8521, while international participants may dial 412-317-6026. A live webcast of the conference call as well as an accompanying slide presentation will be available here: https://app.webinar.net/0pq4wxEAbDQ
A replay of the conference call will be posted on the V2X website shortly after completion of the call and will be available for one year. A telephonic replay will also be available through May 19, 2025, at 844-512-2921 (domestic) or 412-317-6671 (international) with passcode 10198194.
Presentation slides that will be used in conjunction with the conference call will also be made available online in advance on the "investors" section of the company's website at https://gov2x.com. V2X recognizes its website as a key channel of distribution to reach public investors and as a means of disclosing material non-public information to comply with its obligations under the U.S. Securities and Exchange Commission ("SEC") Regulation FD.
(1) See "Key Performance Indicators and Non-GAAP Financial Measures" for descriptions and reconciliations.
About V2X
V2X builds innovative solutions that integrate physical and digital environments by aligning people, actions, and technology. V2X is embedded in all elements of a critical mission's lifecycle to enhance readiness, optimize resource management, and boost security. The company provides innovation spanning national security, defense, civilian, and international markets. With a global team of approximately 16,000 professionals, V2X enables mission success by injecting AI and machine learning capabilities to meet today's toughest challenges across all operational domains.
Investor Contact Media Contact Mike Smith, CFA Angelica Spanos Deoudes IR@goV2X.com Communications@goV2X.com 719-637-5773 571-338-5195
Safe Harbor Statement
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 (the "Act"): Certain material presented herein includes forward-looking statements intended to qualify for the safe harbor from liability established by the Act.
Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "could," "potential," "continue" or similar terminology. These statements are based on the beliefs and assumptions of the management of the Company based on information currently available to management. Forward-looking statements in this press release, include, but are not limited to our future performance and capabilities; all of the statements and items listed under "Reaffirming 2025 Guidance" above and other assumptions contained therein for purposes of such guidance; our belief that prior performance provides substantial visibility for future performance; market trends; our expectations that the foreign military sales and international markets represent a large and growing addressable opportunity; and our belief that our strategy, visibility, and targeted growth opportunities provide substantial opportunities for value creation.
These forward-looking statements are not guarantees of future performance, conditions, or results, and involve a number of known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside our management's control, which could cause actual results to differ materially from the results discussed in the forward-looking statements. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the Company's historical experience and our present expectations or projections. For a discussion of some of the risks and uncertainties that could cause actual results to differ from such forward-looking statements, see the risks and other factors detailed from time to time in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the SEC.
We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
V2X, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended
March 28, March 29,
(In thousands, except per share
data) 2025 2024
--------------------------------- ------------------ ------------------
Revenue $ 1,015,923 $ 1,010,564
Cost of revenue 937,820 940,290
Selling, general, and
administrative expenses 43,805 39,943
Operating income 34,298 30,331
Loss on extinguishment of debt (2,214) --
Interest expense, net (19,719) (27,574)
Other expense, net (2,295) (1,633)
------------------ ------------------
Income from operations before
income taxes 10,070 1,124
Income tax expense (benefit) 1,963 (20)
------------------ ------------------
Net income $ 8,107 $ 1,144
================== ==================
Earnings per share
Basic $ 0.26 $ 0.04
Diluted $ 0.25 $ 0.04
Weighted average common shares
outstanding - basic 31,590 31,351
Weighted average common shares
outstanding -- diluted 32,021 31,794
V2X, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
March 28, December 31,
(In thousands, except per share data) 2025 2024
--------------------------------------- --------------- ---------------
Assets
Current assets
Cash, cash equivalents and restricted
cash $ 169,062 $ 268,321
Receivables 705,384 710,068
Prepaid expenses and other current
assets 128,132 121,831
--------------- ---------------
Total current assets 1,002,578 1,100,220
--------------- ---------------
Property, plant, and equipment, net 60,369 62,001
Goodwill 1,656,926 1,656,926
Intangible assets, net 300,527 323,068
Right-of-use assets 36,841 37,774
Other non-current assets 46,239 48,854
--------------- ---------------
Total non-current assets 2,100,902 2,128,623
--------------- ---------------
Total Assets $ 3,103,480 $ 3,228,843
=============== ===============
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable $ 440,596 $ 547,568
Compensation and other employee
benefits 124,467 166,918
Short-term debt 19,935 20,003
Other accrued liabilities 282,094 261,735
--------------- ---------------
Total current liabilities 867,092 996,224
Long-term debt, net 1,089,792 1,087,484
Deferred tax liabilities 18,441 20,983
Operating lease liabilities 32,350 33,811
Other non-current liabilities 59,988 64,189
--------------- ---------------
Total non-current liabilities 1,200,571 1,206,467
--------------- ---------------
Total liabilities 2,067,663 2,202,691
--------------- ---------------
Commitments and contingencies (Note 7)
Shareholders' Equity
Preferred stock; $0.01 par value;
10,000,000 shares authorized; No
shares issued and outstanding -- --
Common stock; $0.01 par value;
100,000,000 shares authorized;
31,684,495 and 31,560,490 shares
issued and outstanding as of March 28,
2025 and December 31, 2024,
respectively 317 316
Additional paid in capital 769,594 769,719
Retained earnings 273,642 265,535
Accumulated other comprehensive loss (7,736) (9,418)
--------------- ---------------
Total shareholders' equity 1,035,817 1,026,152
--------------- ---------------
Total Liabilities and Shareholders'
Equity $ 3,103,480 $ 3,228,843
=============== ===============
V2X, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three Months Ended
--------------------------------------
March 28, March 29,
(In thousands) 2025 2024
--------------------------------- ------------------ ------------------
Operating activities
Net income $ 8,107 $ 1,144
Adjustments to reconcile net income to net cash used in operating
activities:
Depreciation expense 4,250 6,243
Amortization of intangible assets 22,562 22,539
Amortization of cloud computing
arrangements 1,226 71
Loss on disposal of property,
plant, and equipment 253 8
Stock-based compensation 2,452 5,149
Deferred taxes (3,074) (262)
Amortization of debt issuance
costs 1,488 2,160
Loss on extinguishment of debt 2,214 --
Changes in assets and
liabilities:
Receivables 6,502 (55,363)
Other assets (6,411) (23,593)
Accounts payable (107,694) (33,715)
Compensation and other employee
benefits (42,610) (18,607)
Other liabilities 15,271 37,000
------------------ ------------------
Net cash used in operating
activities (95,464) (57,226)
------------------ ------------------
Investing activities
Purchases of capital assets (2,699) (7,775)
Proceeds from the disposition of
assets 90 5
Acquisitions of businesses -- (16,939)
Net cash used in investing
activities (2,609) (24,709)
------------------ ------------------
Financing activities
Repayments of long-term debt -- (3,840)
Proceeds from revolver 141,000 375,250
Repayments of revolver (141,000) (319,250)
Proceeds from stock awards and
stock options 77 3
Payment of debt issuance costs (1,223) --
Payments of employee withholding
taxes on stock-based
compensation (2,653) (5,702)
------------------ ------------------
Net cash (used in) provided by
financing activities (3,799) 46,461
------------------ ------------------
Exchange rate effect on cash 2,613 (1,519)
------------------ ------------------
Net change in cash, cash
equivalents and restricted cash (99,259) (36,993)
Cash, cash equivalents and
restricted cash - beginning of
period 268,321 72,651
------------------ ------------------
Cash, cash equivalents and
restricted cash - end of period $ 169,062 $ 35,658
================== ==================
Supplemental disclosure of cash
flow information:
Interest paid $ 12,945 $ 27,125
================== ==================
Income taxes paid $ 320 $ 1,014
================== ==================
Purchase of capital assets on
account $ 48 $ 410
================== ==================
Key Performance Indicators and Non-GAAP Measures
The primary financial performance measures we use to manage our business and monitor results of operations are revenue trends and operating income trends. Management believes that these financial performance measures are the primary drivers for our earnings and net cash from operating activities. Management evaluates its contracts and business performance by focusing on revenue, and operating income. Operating income represents revenue less both cost of revenue and selling, general and administrative (SG&A) expenses. Cost of revenue consists of labor, subcontracting costs, materials, and an allocation of indirect costs. SG&A expenses consist of indirect labor costs (including wages and salaries for executives and administrative personnel), bid and proposal expenses and other general and administrative expenses not allocated to cost of revenue. Backlog is the estimated amount of future revenues to be recognized under negotiated contracts.
We manage the nature and amount of costs at the program level, which forms the basis for estimating our total costs and profitability. This is consistent with our approach for managing our business, which begins with management's assessing the bidding opportunity for each contract and then managing contract profitability throughout the performance period.
In addition to the key performance measures discussed above, we consider adjusted net income, adjusted diluted earnings per share, adjusted operating income, adjusted EBITDA, adjusted EBITDA margin, net leverage ratio and adjusted operating cash flow to be useful to management and investors in evaluating our operating performance, and to provide a tool for evaluating our ongoing operations. This information can assist investors in assessing our financial performance and measures our ability to generate capital for deployment among competing strategic alternatives and initiatives. We provide this information to our investors in our earnings releases, presentations, and other disclosures.
Adjusted net income, adjusted diluted earnings per share, adjusted operating income, adjusted EBITDA, adjusted EBITDA margin, net leverage ratio, and adjusted net cash provided by (used in) operating activities, however, are not measures of financial performance under GAAP and should not be considered a substitute for financial measures determined in accordance with GAAP. Definitions and reconciliations of these items are provided below.
-- Adjusted operating income is defined as operating income, adjusted to
exclude items that may include, but are not limited to, significant
charges or credits, and unusual and infrequent non-operating items that
impact current results but are not related to our ongoing operations,
such as M&A, integration, and related costs.
-- Adjusted EBITDA is defined as operating income, adjusted to exclude
depreciation and amortization of intangible assets, and items that may
include, but are not limited to, significant charges or credits, and
unusual and infrequent non-operating items that impact current results
but are not related to our ongoing operations, such as M&A, integration,
and related costs.
-- Adjusted EBITDA margin is defined as adjusted EBITDA divided by revenue.
-- Adjusted net income is defined as net income, adjusted to exclude items
that may include, but are not limited to, significant charges or credits,
and unusual and infrequent non-operating items that impact current
results but are not related to our ongoing operations, such as M&A,
integration and related costs, amortization of acquired intangible assets,
amortization of debt issuance costs, and loss on extinguishment of debt.
-- Adjusted diluted earnings per share is defined as adjusted net income
divided by the weighted average diluted common shares outstanding.
-- Cash interest expense, net is defined as interest expense, net adjusted
to exclude amortization of debt issuance costs.
-- Adjusted net cash provided by (used in) operating activities or adjusted
operating cash flow is defined as net cash provided by (or used in)
operating activities adjusted to exclude infrequent non-operating items,
such as M&A payments and related costs.
Non-GAAP Tables
($K, except per
share data) Three Months Ended
----------------------------------------------------------------------------------------
March 28, 2025 March 29, 2024
------------------------------------------- -------------------------------------------
Revenue $ 1,015,923 $ 1,010,564
Net income
(loss) $ 8,107 $ 1,144
Plus:
Income tax
expense
(benefit) 1,963 (20)
Other expense,
net 2,295 1,633
Interest
expense, net 19,719 27,574
Loss on
extinguishment
of debt 2,214 --
Operating income $ 34,298 $ 30,331
------------------------------------------- -------------------------------------------
Plus:
Amortization of
intangible
assets 22,562 22,539
M&A,
integration
and related
costs 4,625 9,981
Adjusted
operating
income $ 61,485 $ 62,851
------------------------------------------- -------------------------------------------
Plus:
Depreciation
and CCA
amortization 5,476 6,243
Adjusted EBITDA $ 66,961 $ 69,094
------------------------------------------- -------------------------------------------
Adjusted EBITDA
margin 6.6 % 6.8 %
Minus:
Cash interest
expense, net 18,231 25,414
Income tax
expense, as
adjusted 9,234 7,155
Depreciation
and CCA
amortization 5,476 6,243
Other expense,
net, as
adjusted 2,545 1,633
Adjusted net
income $ 31,475 $ 28,649
---------------- ------------------------------------------- -------------------------------------------
($K, except per
share data) Three Months Ended
----------------------------------------------------------------------------------------
March 28, 2025 March 29, 2024
------------------------------------------- -------------------------------------------
Diluted earnings
(loss) per
share $ 0.25 $ 0.04
Plus:
M&A,
integration
and related
costs 0.11 0.25
Amortization of
intangible
assets 0.54 0.56
Amortization of
debt issuance
costs and
Loss on
extinguishment
of debt 0.09 0.05
FMV land
impairment $ -- $ --
Gain on
acquisition,
net $ (0.01) $ --
Adjusted diluted
earnings per
share $ 0.98 $ 0.90
------------------------------------------- -------------------------------------------
Average shares
outstanding:
Basic, as
reported 31,590 31,351
Diluted, as
reported 32,021 31,794
Adjusted
diluted 32,021 31,794
---------------- ------------------------------------------- -------------------------------------------
($K) Three Months Ended
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