BWX Technologies Reports Second Quarter 2021 Results and Continues Progress On Future Growth Milestones

Rhea-AI Summary

BWX Technologies reported Q2 2021 revenue of $505 million, unchanged from Q2 2020. Net income was $59.3 million or $0.62 per diluted share, down from $64.3 million or $0.67 per diluted share last year. The Nuclear Operations Group saw a 7% revenue decrease to $381 million, while the Nuclear Power Group's revenue surged 50% to $102 million. Despite cash from operations falling to $59.9 million from $162 million in Q2 2020, BWXT declared a quarterly dividend of $0.21 per share, payable on September 8, 2021.

Positive

• NPG revenue increased by 50% to $102 million due to higher demand in field services and medical isotopes.
• Declared a quarterly cash dividend of $0.21 per share, payable on September 8, 2021.
• Reiterated 2021 guidance with expected non-GAAP EPS range of $3.05 - $3.20.

Negative

• NOG revenue decreased by 7% to $381 million, impacted by lower long-lead material production.
• Operating income for NOG dropped by 20% to $69.2 million.

BWX Technologies, Inc. (NYSE: BWXT) ("BWXT", "we", "us" or the "Company") reported second quarter 2021 revenue of $505 million, about even compared with $505 million in the second quarter 2020. Net income for the second quarter 2021 was $59.3 million, or $0.62 per diluted share, compared with GAAP net income of $64.3 million, or $0.67 per diluted share and non-GAAP net income of $67.7 million, or $0.71 per diluted share, in the prior-year period. A reconciliation of non-GAAP results is detailed in Exhibit 1.

“BWXT delivered on another solid quarter as we prepared for a strong second half of the year,” said Rex D. Geveden, president and chief executive officer. "We are where we anticipated to be at the midpoint of 2021 and have line-of-sight on the remaining work to accomplish in the year, resulting in us reiterating financial guidance across the board.”

“The Company’s execution is exemplified by the strength we see across the core businesses including the Nuclear Operations Group’s stability as it ramps up on the Columbia program, consistent deliveries of large nuclear power components to enable Canadian clean energy, and the strong proposals submitted at important DOE nuclear sites that we anticipate will lead to wins later this year. At BWXT’s investor day in November, we are excited to share more insight into the strategy and trends across the core businesses while also highlighting emerging opportunities in nuclear medicine, advanced reactors and nuclear fuel that further support the Company’s medium and long-term growth outlook.” said Geveden.

Segment Results

Nuclear Operations Group (NOG) segment revenue was $381 million for the second quarter 2021, a 7% decrease from the prior-year period, driven by higher production volume which was more than offset by lower long-lead material production. NOG operating income was $69.2 million in the second quarter 2021, a 20% decrease compared with the prior-year period driven by lower revenue and fewer favorable contract adjustments due to timing of certain milestones, resulting in second quarter 2021 segment operating margin of 18.1%.

Nuclear Power Group (NPG) segment revenue was $102 million for the second quarter 2021, a 50% increase from the prior-year period primarily due to higher volume of field services, higher fuel and fuel handling activity, and higher volume of medical isotope demand. NPG operating income was $10.8 million for the second quarter 2021, a significant increase compared with the prior-year period on both a GAAP and non-GAAP basis, driven primarily from higher revenue in commercial nuclear power and BWXT medical, and incremental funds received under the Canadian COVID-19 Economic Response Plan to offset incurred expenses related to the pandemic. Second quarter 2021 segment operating margin was 10.6%.

Nuclear Services Group (NSG) segment operating income was $5.8 million for the second quarter 2021, up 40% compared with $4.1 million of GAAP operating income and up 13% compared with $5.1 million of non-GAAP operating income in the second quarter 2020 driven by better project performance partially offset by the absence of contracts that completed in 2020.

Cash and Capital Returned to Shareholders

The Company generated $59.9 million of cash from operating activities in the second quarter 2021, compared with $162 million in the second quarter 2020. As of June 30, 2021, the Company’s cash balance, net of restricted cash, was $191 million.

On July 30, 2021, the BWXT Board of Directors declared a quarterly cash dividend of $0.21 per common share. The dividend will be payable on September 8, 2021, to shareholders of record on August 19, 2021.

During the second quarter 2021, the Company returned $20.0 million of cash to shareholders in dividends, resulting in a total of $60.3 million of cash returned to shareholders year-to-date, including $20.0 million in share repurchases and $40.3 million in dividends.

2021 Guidance

BWXT reiterated all components of 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 Second Quarter 2021 Results

Date:	Monday, August 2, 2021, at 5:00 p.m. EDT
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/q22021-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 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 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 and subsequent quarterly reports on Form 10-Q. 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 global 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 @BWXT 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)
Three Months Ended June 30, 2020
		GAAP					Restructuring Costs					Costs Associated with Sale of Business					Debt Issuance Costs						Non-GAAP
Operating Income		$	82.4				$	1.3				$	2.7				$	—					$	86.4
Other Income (Expense)		1.6					—					—					0.5						2.2
Provision for Income Taxes		(19.7		)			(0.3		)			(0.6		)			(0.1		)				(20.8		)
Net Income		64.4					0.9					2.1					0.4						67.8
Net Income Attributable to Noncontrolling Interest		(0.1		)			—					—					—						(0.1		)
Net Income Attributable to BWXT		$	64.3				$	0.9				$	2.1				$	0.4					$	67.7
Diluted Shares Outstanding		95.6																					95.6
Diluted Earnings per Common Share		$	0.67				$	0.01				$	0.02				$	0.00					$	0.71
Effective Tax Rate		23.4		%																			23.4		%
NPG Operating Income		$	1.1				$	1.3				$	—				$	—					$	2.4
NSG Operating Income		$	4.1				$	—				$	1.0				$	—					$	5.1

(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.

 

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FAQ

What was BWX Technologies' revenue for Q2 2021?

BWX Technologies reported revenue of $505 million for Q2 2021.

How much did BWX Technologies earn in net income for Q2 2021?

BWX Technologies reported a net income of $59.3 million for Q2 2021.

What is BWXT's dividend payout date for Q2 2021?

The dividend payout date for BWXT is September 8, 2021.

What is the 2021 EPS guidance for BWX Technologies?

BWX Technologies reiterated a non-GAAP EPS guidance of $3.05 - $3.20 for 2021.

What was the revenue trend for the Nuclear Operations Group in Q2 2021?

The Nuclear Operations Group's revenue fell by 7% to $381 million in Q2 2021.