Karman (KRMN) TD Cowen 47th Annual Aerospace & Defense Conference summary

Strategic positioning and business model

• Operates as a vertically integrated merchant supplier, enabling over 80 prime contractor customers across 130+ programs, with no intention to become a prime contractor.

• Focuses on highly engineered, IP-rich system solutions for missiles, missile defense, space launch, hypersonics, drones, counter-UAS, and maritime defense.

• Offers end-to-end solutions from design to full-rate production, enhancing speed, agility, and efficiency.

• Diversified revenue base across customers, programs, and product lifecycles, with qualified positions on key national security and development programs.

• Recent acquisitions, including Seemann Composites and MSC, expand exposure to the maritime market and align with the company's diversification strategy.

Financial performance and growth

• Achieved 2024 revenue of $345M, representing 23% growth, with adjusted EBITDA of $106M and a 31% margin.

• Achieved a 24% topline CAGR and 33% adjusted EBITDA CAGR from 2022 to 2024, with a funded backlog growing at a 48% CAGR, reaching $580M in 2024.

• Revenue diversification: largest program accounted for about 11% of 2024 revenue, with further diversification expected from new acquisitions.

• Pursued 10 strategic acquisitions since 2020, expanding capabilities, IP, and market reach, and consistently generating incremental growth opportunities.

• CapEx investments increased to 4.5% of revenue in 2025 to prepare for rising demand and production expansion.

Market trends and end markets

• Serves four high-growth, high-priority end markets: hypersonics/strategic missile defense, tactical missiles/integrated defense, maritime defense, and space/launch.

• Maritime market, especially Columbia-class and Virginia-class submarines, offers long-term visibility and significant sustainment revenue.

• Space and launch segment benefits from increased launch cadence and involvement in commercial lunar lander integration.

• International revenue is limited but growing, primarily through foreign military sales (FMS) to allies.

• Positioned to support both established primes and emerging defense startups, enhancing customer and program diversification.