TransDigm Group (TDG) Q4 2024 earnings summary

Executive summary

• Fiscal 2024 revenue grew 21% year-over-year to $7.94 billion, with Q4 revenue up 18% to $2.19 billion; organic sales growth was 16.2%.

• Adjusted EPS increased 32% to $33.99 for FY 2024; Q4 Adjusted EPS rose 22% to $9.83.

• EBITDA As Defined margin reached 52.6% for both Q4 and full year, reflecting strong operational leverage.

• Growth was driven by robust commercial and defense markets, significant contributions from recent acquisitions, and strong operational execution.

• Three acquisitions and a $75/share special dividend marked significant capital deployment.

Financial highlights

• Fiscal 2024 revenue and EBITDA As Defined margin both exceeded the high end of guidance.

• Q4 EBITDA As Defined margin was 52.6%; Q4 EBITDA As Defined was $1,149 million, up 19% year-over-year.

• Q4 operating cash flow exceeded $570 million; year-end cash balance was nearly $6.3 billion.

• Free cash flow for the year was approximately $2.3 billion; net cash provided by operating activities was $2,045 million.

• Long-term debt increased to $24.3 billion, reflecting new debt issuance.

Outlook and guidance

• Fiscal 2025 revenue guidance midpoint is $8.85 billion, up ~11% year-over-year.

• Fiscal 2025 EBITDA As Defined guidance midpoint is $4.685 billion, margin ~52.9%.

• Adjusted EPS guidance midpoint is $36.32, up ~7%.

• Commercial OEM revenue expected to grow mid-single digits; aftermarket high single to low double digits; defense high single digits.

• Q1 2025 expected to be seasonally lowest due to fewer working days and booking softness.