- Generates 4Q20 EPS of $0.69 (GAAP), $0.74 (non-GAAP); up 8% and
4% respectively vs. 4Q19
- Produces 2020 EPS of $2.91 (GAAP), $3.03 (non-GAAP); up 14% and
16% respectively vs. 2019
- Reports record quarterly and annual revenue: $557 million in
4Q20, more than $2.1 billion in 2020
- Increases quarterly dividend 11% to $0.21 per share
- Achieves low-double-digit compounded non-GAAP EPS growth
compared with 2017 results
- Issues 2021 guidance: non-GAAP EPS range of $3.05 to $3.20 on
low-single digit consolidated revenue growth
BWX Technologies, Inc. (NYSE: BWXT) ("BWXT", "we", "us" or the
"Company") reported record revenue in the fourth quarter 2020 at
$557 million, an 11% increase compared with $501 million in the
fourth quarter 2019. GAAP net income for the fourth quarter 2020
was $65.7 million, or $0.69 per diluted share, compared with GAAP
net income of $61.4 million, or $0.64 per diluted share, in the
prior-year period. Non-GAAP net income for the fourth quarter 2020
was $70.9 million, or $0.74 per diluted share, compared with
non-GAAP net income of $67.9 million, or $0.71 per diluted share,
in the prior-year period.
Revenue in 2020 established a new record at over $2.1 billion, a
12% increase compared to $1.9 billion in 2019. GAAP net income in
2020 was $279 million, or $2.91 per diluted share, compared with
GAAP net income of $244 million, or $2.55 per diluted share, in
2019. Non-GAAP net income in 2020 was $290 million, or $3.03 per
diluted share, compared with non-GAAP net income of $251 million,
or $2.62 per diluted share, in 2019. A reconciliation of non-GAAP
results is detailed in Exhibit 1.
“We demonstrated operational and financial strength across the
business, resulting in the achievement of the long-term EPS
guidance that we established over three years ago,” said Rex D.
Geveden, president and chief executive officer. “We remain
well-positioned for long-term growth with stable and expanding core
businesses combined with exciting nuclear opportunities in new
markets with new applications.”
“Although 2020 presented the business with some extraordinary
pressures owing to the pandemic,” Geveden continued, “we have
persisted with rigorous procedures, practices, and policy to
protect our workforce and our business. Accordingly, we remain
cautiously optimistic as we continue to navigate a challenging
environment in 2021.”
“While we expect modest growth in 2021, we remain focused on
edifying BWXT’s premier position as the manufacturer of naval
nuclear reactors through outstanding execution, while completing
the capacity expansion campaign for the Navy’s growing demand for
our products. We expect 2021 to provide incremental validation of
our progress against significant long-term opportunities, including
achieving significant milestones in our disruptive Technetium-99m
generator product line, continued rebuilding of the Department of
Energy site management and environmental remediation portfolio, and
developing a strong presence in the nuclear microreactor market,”
said Geveden.
Segment Results
Nuclear Operations Group (NOG) segment revenue was $426 million
for the fourth quarter 2020, a 15% increase from the prior-year
period, driven by higher long-lead material and fuel volume.
Full-year 2020 segment revenue was over $1.6 billion, a 15%
increase compared with 2019 revenue, as a result of higher
long-lead material, fuel, and downblending volume.
NOG operating income was $81.3 million in the fourth quarter
2020, a 13% increase compared with the prior-year period, primarily
driven by higher revenue. Full-year segment operating income was
$326 million, a 9% increase compared with the prior year, driven by
higher revenue, partially offset by fewer positive adjustments to
backlog contracts compared with the prior-year. Fourth quarter and
full-year 2020 segment operating margins were 19.1% and 19.8%,
respectively.
Nuclear Power Group (NPG) segment revenue was $107 million for
the fourth quarter 2020, a 10% increase from the prior-year period,
due to the Laker Energy acquisition, higher outage service volume
and higher fuel production, partially offset by lower component
volume. Full-year segment revenue was $371 million, a 5% increase
compared with the prior year, primarily from the Laker Energy
acquisition, higher outage service volume and higher fuel
production, partially offset by lower component volume.
NPG GAAP and non-GAAP operating income was $13.2 million and
$13.6 million, respectively, in the fourth quarter 2020, a $4.2
million and a $6.1 million respective decrease from the prior-year
period, driven primarily from the absence of a reduction in an
asset retirement obligation that occurred in the prior-year period
and lower component volume, partially offset from the Laker Energy
acquisition and funds received under the Canadian Emergency Wage
Subsidy (CEWS) program for COVID-19 economic relief to offset
incurred expenses related to the headwinds created by the pandemic.
Full-year segment GAAP and non-GAAP operating income was $52.0
million and $54.2 million, respectively, a 3% and a 4% respective
decrease compared with the prior year, driven by negative cost
impacts related to COVID-19, an unfavorable shift in product mix,
and the absence of a reduction in an asset retirement obligation
that occurred in 2019, partially offset by funds received in 2020
under the CEWS program of $20.4 million to offset incurred expenses
related to the headwinds created by the pandemic. Fourth quarter
and full-year 2020 GAAP segment operating margins were 12.3% and
14.0%, respectively. Fourth quarter and full-year 2020 non-GAAP
segment operating margins were 12.7% and 14.6%, respectively.
Nuclear Services Group (NSG) segment operating income was $8.4
million in the fourth quarter of 2020, compared with $5.6 million
GAAP operating income and $8.2 million non-GAAP operating income
for the fourth quarter of 2019. Better contract performance and
lower costs were partially offset by higher business development
expense and lower income from completed contracts. Full-year
segment GAAP and non-GAAP operating income was $26.4 million and
$27.4 million, respectively, significantly higher than the $14.2
million GAAP operating income and $17.1 million non-GAAP operating
income reported in 2019, primarily driven by increased income from
U.S. commercial nuclear services prior to divestiture.
Cash and Capital Returned to Shareholders
The Company generated $48.3 million of cash from operating
activities in the fourth quarter 2020, compared with $188 million
of cash generated from operating activities in the fourth quarter
of 2019 with the primary difference driven by the receipt of a
single $88.7 million cash payment on January 4, 2021, the first
business day of the 2021 fiscal year, that historically was
received before the end of the fiscal year. The Company generated
$196 million of cash from operating activities for the full year
2020. At the end of 2020, the Company’s cash balance, net of
restricted cash, was $42.6 million.
The Company returned $20.0 million to shareholders during the
fourth quarter 2020, bringing the total to $94.9 million of cash
returned for the full year, including $22.0 million in share
repurchases and $72.9 million in dividends. As of December 31,
2020, total remaining share repurchase authorization was $143
million and expires on November 6, 2021.
On February 19, 2021, the BWXT Board of Directors declared a
quarterly cash dividend of $0.21 per common share, representing an
11% increase from the prior quarterly cash dividend. The dividend
will be payable on March 26, 2021, to shareholders of record on
March 10, 2021.
2021 Guidance
- Non-GAAP EPS range of $3.05 – $3.20 (excludes pension and
post-retirement benefits mark-to-market)
- Consolidated revenue growth of low-single digits vs. 2020
results
- NOG revenue up slightly
- NPG revenue growth of ~6%
- Non-GAAP operating income and margin
- NOG operating margin of “high teens” with upside from CAS
pension reimbursement
- NPG operating margin of ~13%
- NSG operating income range of $25-30 million
- Capital expenditures of ~$250 million
The Company does not provide GAAP guidance because it is unable
to reliably forecast most of the items that are excluded from GAAP
to calculate non-GAAP results. These items could cause GAAP results
to differ materially from non-GAAP results. See reconciliation of
non-GAAP results in Exhibit 1 for additional information.
Conference Call to Discuss Fourth Quarter and Full Year 2020
Results Date: Tuesday, February 23, 2021, at 9:00 a.m.
EST Live Webcast: Investor Relations section of website at
www.bwxt.com
Full Earnings Release Available on BWXT Website
A full version of this earnings release is available on our
Investor Relations website at http://investors.bwxt.com/q42020-release.
BWXT may use its website (www.bwxt.com) as a channel of
distribution of material Company information. Financial and other
important information regarding BWXT is routinely accessible
through and posted on our website. In addition, you may elect to
automatically receive e-mail alerts and other information about
BWXT by enrolling through the “Email Alerts” section of our website
at http://investors.bwxt.com.
Forward-Looking Statements
BWXT cautions that this release contains forward-looking
statements, including, without limitation, statements relating to
backlog, to the extent they may be viewed as an indicator of future
revenues; our plans and expectations for the NOG, NPG and NSG
segments including the expectations, timing and revenue of our
strategic initiatives, such as medical radioisotopes; disruptions
to our supply chain and/or operations, changes in government
regulations and other factors, including any such impacts of, or
actions in response to the COVID-19 health crisis; and our
expectations and guidance for 2021 and beyond. These
forward-looking statements are based on management’s current
expectations and involve a number of risks and uncertainties,
including, among other things, our ability to execute contracts in
backlog; the lack of, or adverse changes in, federal appropriations
to government programs in which we participate; the demand for and
competitiveness of nuclear products and services; capital
priorities of power generating utilities; the impact of COVID-19 on
our business and our employees, contractors, suppliers, customers
and other partners and their business activities; the extent to
which the length and severity of the COVID-19 health crisis exceeds
our current expectations; the potential recurrence of subsequent
waves or strains of COVID-19 or similar diseases; adverse changes
in the industries in which we operate; and delays, changes or
termination of contracts in backlog. If one or more of these risks
or other risks materialize, actual results may vary materially from
those expressed. For a more complete discussion of these and other
risk factors, see BWXT’s filings with the Securities and Exchange
Commission, including our annual report on Form 10-K for the year
ended December 31, 2020. BWXT cautions not to place undue reliance
on these forward-looking statements, which speak only as of the
date of this release, and undertakes no obligation to update or
revise any forward-looking statement, except to the extent required
by applicable law.
About BWXT
At BWX Technologies, Inc. (NYSE: BWXT), we are People Strong,
Innovation Driven. Headquartered in Lynchburg, Va., BWXT provides
safe and effective nuclear solutions for national security, clean
energy, environmental remediation, nuclear medicine and space
exploration. With approximately 6,700 employees, BWXT has 12 major
operating sites in the U.S. and Canada. In addition, BWXT joint
ventures provide management and operations at more than a dozen
U.S. Department of Energy and NASA facilities. Follow us on Twitter
at @BWXTech and learn more at www.bwxt.com.
EXHIBIT
1
BWX TECHNOLOGIES, INC.
RECONCILIATION OF NON-GAAP
OPERATING INCOME AND EARNINGS PER SHARE(1)(2)(3)
(In millions, except per share
amounts)
Three Months Ended December
31, 2020
GAAP
Pension & OPEB MTM (Gain)
/ Loss
Restructuring Costs
Costs Associated with Sale of
Business
Non-GAAP
Operating Income
$
89.1
$
—
$
0.4
$
0.2
$
89.6
Other Income (Expense)
(1.3
)
6.4
—
—
5.1
Provision for Income Taxes
(21.8
)
(1.6
)
(0.1
)
(0.0
)
(23.5
)
Net Income
66.0
4.8
0.3
0.2
71.2
Net Income Attributable to Noncontrolling
Interest
(0.2
)
—
—
—
(0.2
)
Net Income Attributable to BWXT
$
65.7
$
4.8
$
0.3
$
0.2
$
70.9
Diluted Shares Outstanding
95.8
95.8
Diluted Earnings per Common Share
$
0.69
$
0.05
$
0.00
$
0.00
$
0.74
Effective Tax Rate
24.8
%
24.8
%
NPG Operating Income
$
13.2
$
0.4
$
13.6
Three Months Ended December
31, 2019
GAAP
Pension & OPEB MTM (Gain)
/ Loss
Restructuring & Impairment
Costs
Acquisition Related
Costs
Non-GAAP
Operating Income
$
82.9
$
—
$
4.9
$
0.2
$
87.9
Other Income (Expense)
(4.3
)
3.6
—
—
(0.6
)
Provision for Income Taxes
(17.1
)
(0.9
)
(1.3
)
(0.0
)
(19.3
)
Net Income
61.6
2.7
3.6
0.1
68.0
Net Income Attributable to Noncontrolling
Interest
(0.1
)
—
—
—
(0.1
)
Net Income Attributable to BWXT
$
61.4
$
2.7
$
3.6
$
0.1
$
67.9
Diluted Shares Outstanding
95.9
95.9
Diluted Earnings per Common Share
$
0.64
$
0.03
$
0.04
$
0.00
$
0.71
Effective Tax Rate
21.7
%
22.1
%
NPG Operating Income
$
17.4
$
2.3
$
19.7
NSG Operating Income
$
5.6
$
2.6
$
8.2
(1)
Tables may not foot due to rounding.
(2)
BWXT is providing non-GAAP information
regarding certain of its historical results and guidance on future
earnings per share to supplement the results provided in accordance
with GAAP and it should not be considered superior to, or as a
substitute for, the comparable GAAP measures. BWXT believes the
non-GAAP measures provide meaningful insight and transparency into
the Company’s operational performance and provides these measures
to investors to help facilitate comparisons of operating results
with prior periods and to assist them in understanding BWXT's
ongoing operations.
(3)
BWXT has not included a reconciliation of
provided non-GAAP guidance to the comparable GAAP measures due to
the difficulty of estimating any mark-to-market adjustments for
pension and post-retirement benefits, which are determined at the
end of the year.
EXHIBIT 1
(continued)
BWX TECHNOLOGIES, INC.
RECONCILIATION OF NON-GAAP
OPERATING INCOME AND EARNINGS PER SHARE(1)(2)(3)
(In millions, except per share
amounts)
Year Ended December 31,
2020
GAAP
Pension & OPEB MTM (Gain)
/ Loss
Restructuring Costs
Costs Associated with Sale of
Business
Debt Issuance Costs
One-time Franchise Tax Audit
Expense
Non-GAAP
Operating Income
$
358.6
$
—
$
2.3
$
2.9
$
—
$
2.6
$
366.3
Other Income (Expense)
3.6
6.4
—
—
0.5
—
10.5
Provision for Income Taxes
(83.0
)
(1.6
)
(0.6
)
(0.7
)
(0.1
)
(0.6
)
(86.5
)
Net Income
279.2
4.8
1.7
2.2
0.4
2.0
290.3
Net Income Attributable to Noncontrolling
Interest
(0.5
)
—
—
—
—
—
(0.5
)
Net Income Attributable to BWXT
$
278.7
$
4.8
$
1.7
$
2.2
$
0.4
$
2.0
289.8
Diluted Shares Outstanding
95.7
95.7
Diluted Earnings per Common Share
$
2.91
$
0.05
$
0.02
$
0.02
$
0.00
$
0.02
$
3.03
Effective Tax Rate
22.9
%
23.0
%
NPG Operating Income
$
52.0
$
2.3
$
54.2
NSG Operating Income
$
26.4
$
1.0
$
27.4
Year Ended December 31,
2019
GAAP
Pension & OPEB MTM (Gain)
/ Loss
Restructuring & Impairment
Costs
Acquisition Related
Costs
Non-GAAP
Operating Income
$
325.5
$
—
$
5.8
$
0.2
$
331.5
Other Income (Expense)
(11.8
)
3.6
—
—
(8.1
)
Provision for Income Taxes
(69.1
)
(0.9
)
(1.5
)
(0.0
)
(71.5
)
Net Income
244.7
2.7
4.3
0.1
251.8
Net Income Attributable to Noncontrolling
Interest
(0.6
)
—
—
—
(0.6
)
Net Income Attributable to BWXT
$
244.1
$
2.7
$
4.3
$
0.1
251.3
Diluted Shares Outstanding
95.8
95.8
Diluted Earnings per Common Share
$
2.55
$
0.03
$
0.04
$
0.00
$
2.62
Effective Tax Rate
22.0
%
22.1
%
NPG Operating Income
$
53.8
$
2.6
$
56.4
NSG Operating Income
$
14.2
$
2.9
$
17.1
(1)
Tables may not foot due to rounding.
(2)
BWXT is providing non-GAAP information
regarding certain of its historical results and guidance on future
earnings per share to supplement the results provided in accordance
with GAAP and it should not be considered superior to, or as a
substitute for, the comparable GAAP measures. BWXT believes the
non-GAAP measures provide meaningful insight and transparency into
the Company’s operational performance and provides these measures
to investors to help facilitate comparisons of operating results
with prior periods and to assist them in understanding BWXT's
ongoing operations.
(3)
BWXT has not included a reconciliation of
provided non-GAAP guidance to the comparable GAAP measures due to
the difficulty of estimating any mark-to-market adjustments for
pension and post-retirement benefits, which are determined at the
end of the year.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210222005829/en/
Investor Contact: Mark Kratz Director, Investor Relations
980-365-4300 Investors@bwxt.com Media Contact: Jud Simmons
Director, Media and Public Relations 434-522-6462
hjsimmons@bwxt.com
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