V2X (VVX) Q4 2024 earnings summary

Executive summary

• Achieved record quarterly and full-year 2024 revenue of $4.32B, up 9% year-over-year, with Q4 revenue of $1.16B, up 11%.

• Adjusted EBITDA reached $310M for the year and $86.2M in Q4, with margins of 7.2% and 7.4% respectively.

• Backlog reached $12.5B with a Q4 book-to-bill ratio of 1.2x and record $5.5B in contract wins.

• Net debt reduced by $210M year-over-year to $874M, with net leverage ratio at 2.6x.

• Notable 27% revenue growth in the Indo-Pacific region and appointment of a new Chief Growth Officer to drive expansion.

Financial highlights

• Q4 adjusted EBITDA: $86.2M (7.4% margin); full-year adjusted EBITDA: $310M (7.2% margin).

• Q4 adjusted EPS: $1.33 (up 9%); full-year adjusted EPS: $4.34 (up 16%).

• Adjusted net cash from operating activities: $161M for the year; $168M in Q4.

• Net leverage ratio improved to 2.6x, with $210M net debt reduction year-over-year.

• Cash interest expense for the year was $100.5M, down 11% year-over-year.

Outlook and guidance

• 2025 revenue guidance: $4.375B–$4.5B (midpoint $4.44B); adjusted EBITDA: $305M–$320M (midpoint $313M); adjusted EPS: $4.45–$4.85 (midpoint $4.65).

• 2025 adjusted net cash from operations guidance: $150M–$170M (midpoint $160M); capex guidance: ~$30M.

• Revenue and EBITDA expected to ramp through the year, with back-half weighting due to contract phasing.

• Guidance assumes business as usual regarding continuing resolution (CR) impacts.

• Guidance assumes cash interest expense of ~$83M and D&A of ~$113M.