First Quarter Financial Highlights
- Revenue of
$1.25 billion , up 23% year-over-year - Net income of
$18.9 million ; Adjusted net income1 of$48.1 million , up 53% year-over-year - Adjusted EBITDA1 of
$85.6 million ; Adjusted EBITDA1 margin of 6.8% - Diluted EPS of
$0.60 ; Adjusted diluted EPS1 of$1.53 , up 55% year-over-year - Record backlog1 of
$13.8 billion , driven by 3.2x book-to-bill1 in the quarter
Increasing 2026 Guidance
- Increasing full-year 2026 guidance with 9% revenue and adjusted EBITDA1 growth at the midpoint
"V2X delivered a strong start to 2026, with double-digit growth on both the top and bottom lines, underscoring our team's disciplined execution and our organization's alignment to national security priorities," said
First Quarter 2026 Results
In the first quarter, V2X reported revenue of
V2X delivered adjusted EBITDA1 of
First quarter net cash used by operating activities was
At the end of the first quarter, net debt for V2X was
As of
Increasing 2026 Guidance
The Company is increasing its 2026 guidance ranges as follows:
|
$ millions, except for per share amounts |
Prior 2026 Guidance |
Updated 2026 Guidance |
||
|
Revenue |
|
|
|
|
|
Adjusted EBITDA1 |
|
|
|
|
|
Adjusted Diluted Earnings Per Share1 |
|
|
|
|
|
Adjusted Net Cash Provided by Operating Activities1 |
|
|
|
|
The Company is not providing a quantitative reconciliation with respect to the foregoing forward-looking non-GAAP measures in reliance on the "unreasonable efforts" exception set forth in
First Quarter Conference Call
Management will conduct a conference call with analysts and investors at
A replay of the conference call will be posted on the V2X website shortly after completion of the call and will be available for one year. A telephonic replay will also be available through
Presentation slides that will be used in conjunction with the conference call will also be made available online in advance on the "investors" section of the company's website at https://gov2x.com. V2X recognizes its website as a key channel of distribution to reach public investors and as a means of disclosing material non-public information to comply with its obligations under the
|
__________________________________ |
About V2X
V2X builds innovative solutions that integrate physical and digital environments by aligning people, actions, and technology. V2X is embedded in all elements of a critical mission's lifecycle to enhance readiness, optimize resource management, and boost security. The company provides innovation spanning national security, defense, civilian, and international markets. With a global team of approximately 16,200 professionals, V2X enables mission success by injecting AI and machine learning capabilities to meet today's toughest challenges across all operational domains.
|
Investor Contact |
Media Contact |
|
|
|
|
719-637-5773 |
571-338-5195 |
Safe Harbor Statement
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 (the "Act"): Certain material presented herein includes forward-looking statements intended to qualify for the safe harbor from liability established by the Act.
Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "could," "potential," "continue" or similar terminology. These statements are based on the beliefs and assumptions of the management of the Company based on information currently available to management. Forward-looking statements in this press release, include, but are not limited to our future performance and capabilities; all of the statements and items listed under "Increasing 2026 Guidance" above and other assumptions contained therein for purposes of such guidance; our belief that prior performance provides substantial visibility for future performance; market trends; product development; capital deployment; future net leverage ratio; and our belief that our innovation strategy, visibility, and targeted growth opportunities provide substantial opportunities for value creation.
These forward-looking statements are not guarantees of future performance, conditions, or results, and involve a number of known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside our management's control, which could cause actual results to differ materially from the results discussed in the forward-looking statements. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the Company's historical experience and our present expectations or projections. For a discussion of some of the risks and uncertainties that could cause actual results to differ from such forward-looking statements, see the risks and other factors detailed from time to time in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the
We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
|
||||
|
|
|
Three Months Ended |
||
|
|
|
|
|
|
|
(In thousands, except per share data) |
|
2026 |
|
2025 |
|
Revenue |
|
$ 1,254,128 |
|
$ 1,015,923 |
|
Cost of revenue |
|
1,148,310 |
|
937,820 |
|
Selling, general, and administrative expenses |
|
61,728 |
|
43,805 |
|
Operating income |
|
44,090 |
|
34,298 |
|
Loss on extinguishment of debt |
|
— |
|
(2,214) |
|
Interest expense, net |
|
(18,125) |
|
(19,719) |
|
Other expense, net |
|
(2,446) |
|
(2,295) |
|
Income from operations before income taxes |
|
23,519 |
|
10,070 |
|
Income tax expense |
|
4,594 |
|
1,963 |
|
Net income |
|
$ 18,925 |
|
$ 8,107 |
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
Basic |
|
$ 0.61 |
|
$ 0.26 |
|
Diluted |
|
$ 0.60 |
|
$ 0.25 |
|
Weighted average common shares outstanding - basic |
|
31,214 |
|
31,590 |
|
Weighted average common shares outstanding - diluted |
|
31,512 |
|
32,021 |
|
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
|
||||
|
|
|
|
|
|
|
(In thousands, except per share data) |
|
2026 |
|
2025 |
|
Assets |
|
|
|
|
|
Current assets |
|
|
|
|
|
Cash, cash equivalents and restricted cash |
|
$ 208,666 |
|
$ 368,994 |
|
Receivables |
|
828,759 |
|
738,922 |
|
Prepaid expenses and other current assets |
|
131,981 |
|
127,102 |
|
Total current assets |
|
1,169,406 |
|
1,235,018 |
|
Property, plant, and equipment, net |
|
50,640 |
|
52,383 |
|
Goodwill |
|
1,676,954 |
|
1,677,154 |
|
Intangible assets, net |
|
217,060 |
|
239,760 |
|
Other non-current assets |
|
75,409 |
|
76,525 |
|
Total non-current assets |
|
2,020,063 |
|
2,045,822 |
|
Total Assets |
|
$ 3,189,469 |
|
$ 3,280,840 |
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Accounts payable |
|
$ 467,420 |
|
$ 557,042 |
|
Compensation and other employee benefits |
|
170,388 |
|
176,530 |
|
Short-term debt |
|
14,935 |
|
14,935 |
|
Other accrued liabilities |
|
280,561 |
|
267,039 |
|
Total current liabilities |
|
933,304 |
|
1,015,546 |
|
Long-term debt, net |
|
1,060,928 |
|
1,083,234 |
|
Deferred tax liabilities |
|
30,232 |
|
28,357 |
|
Other non-current liabilities |
|
61,462 |
|
69,067 |
|
Total non-current liabilities |
|
1,152,622 |
|
1,180,658 |
|
Total liabilities |
|
2,085,926 |
|
2,196,204 |
|
Commitments and contingencies (Note 7) |
|
|
|
|
|
Shareholders' Equity |
|
|
|
|
|
Preferred stock; |
|
— |
|
— |
|
Common stock; |
|
318 |
|
317 |
|
|
|
(30,274) |
|
(30,274) |
|
Additional paid in capital |
|
777,994 |
|
779,084 |
|
Retained earnings |
|
362,342 |
|
343,417 |
|
Accumulated other comprehensive loss |
|
(6,837) |
|
(7,908) |
|
Total shareholders' equity |
|
1,103,543 |
|
1,084,636 |
|
Total Liabilities and Shareholders' Equity |
|
$ 3,189,469 |
|
$ 3,280,840 |
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
|
||||
|
|
|
Three Months Ended |
||
|
|
|
|
|
|
|
(In thousands) |
|
2026 |
|
2025 |
|
Operating activities |
|
|
|
|
|
Net income |
|
$ 18,925 |
|
$ 8,107 |
|
Adjustments to reconcile net income to net cash used in operating activities: |
||||
|
Depreciation expense |
|
3,963 |
|
4,250 |
|
Amortization of intangible assets |
|
22,900 |
|
22,562 |
|
Amortization of cloud computing arrangements |
|
1,246 |
|
1,226 |
|
Loss on disposal of property, plant, and equipment |
|
3 |
|
253 |
|
Stock-based compensation |
|
3,609 |
|
2,452 |
|
Deferred taxes |
|
1,557 |
|
(3,074) |
|
Amortization of debt issuance costs |
|
1,669 |
|
1,488 |
|
Loss on extinguishment of debt |
|
— |
|
2,214 |
|
Changes in assets and liabilities: |
|
|
|
|
|
Receivables |
|
(90,701) |
|
6,502 |
|
Other assets |
|
(5,348) |
|
(6,411) |
|
Accounts payable |
|
(89,372) |
|
(107,694) |
|
Compensation and other employee benefits |
|
(6,050) |
|
(42,610) |
|
Other liabilities |
|
7,689 |
|
15,271 |
|
Net cash used in operating activities |
|
(129,910) |
|
(95,464) |
|
Investing activities |
|
|
|
|
|
Purchases of capital assets |
|
(2,291) |
|
(2,699) |
|
Proceeds from the disposition of assets |
|
— |
|
90 |
|
Net cash used in investing activities |
|
(2,291) |
|
(2,609) |
|
Financing activities |
|
|
|
|
|
Repayments of long-term debt |
|
(23,734) |
|
— |
|
Proceeds from revolver |
|
— |
|
141,000 |
|
Repayments of revolver |
|
— |
|
(141,000) |
|
Proceeds from stock awards and stock options |
|
60 |
|
77 |
|
Payment of debt issuance costs |
|
— |
|
(1,223) |
|
Payments of employee withholding taxes on stock-based compensation |
|
(4,758) |
|
(2,653) |
|
Net cash used in financing activities |
|
(28,432) |
|
(3,799) |
|
Exchange rate effect on cash |
|
305 |
|
2,613 |
|
Net change in cash, cash equivalents and restricted cash |
|
(160,328) |
|
(99,259) |
|
Cash, cash equivalents and restricted cash - beginning of period |
|
368,994 |
|
268,321 |
|
Cash, cash equivalents and restricted cash - end of period |
|
$ 208,666 |
|
$ 169,062 |
|
|
|
|
|
|
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
Interest paid |
|
$ 17,426 |
|
$ 12,945 |
|
Income taxes paid |
|
$ 2,707 |
|
$ 320 |
|
Purchase of capital assets on account |
|
$ 1,510 |
|
$ 48 |
Key Performance Indicators and Non-GAAP Measures
The primary financial performance measures we use to monitor results of operations are revenue and operating income. Management believes that these financial performance measures are the primary drivers for our earnings and net cash from operating activities. Management evaluates its contracts and business performance by focusing on revenue and operating income. Operating income represents revenue less both cost of revenue and selling, general and administrative (SG&A) expenses. Cost of revenue consists of labor, subcontracting costs, materials, and an allocation of indirect costs. SG&A expenses consist of indirect labor costs (including wages and salaries for executives and administrative personnel), bid and proposal expenses and other general and administrative expenses not allocated to cost of revenue. Backlog is the estimated amount of future revenues to be recognized under negotiated contracts. Funded backlog is contractually authorized and appropriated by the customer. Bookings includes approved values formally booked into V2X's backlog for new business contract awards including unexercised options, contract modifications, recompetes, contract extensions and add-on work to existing contracts. Book-to-bill is derived by dividing bookings by revenue.
We manage the nature and amount of costs at the program level, which forms the basis for estimating our total costs and profitability. This is consistent with our approach for managing our business, which begins with management's assessing the bidding opportunity for each contract and then managing contract profitability throughout the performance period.
In addition to the key performance measures discussed above, we consider adjusted net income, adjusted diluted earnings per share, adjusted operating income, adjusted EBITDA, adjusted EBITDA margin, net leverage ratio and adjusted operating cash flow to be useful to management and investors in evaluating our operating performance, and to provide a tool for evaluating our ongoing operations. This information can assist investors in assessing our financial performance and measures our ability to generate capital for deployment among competing strategic alternatives and initiatives. We provide this information to our investors in our earnings releases, presentations, and other disclosures.
Adjusted net income, adjusted diluted earnings per share, adjusted EBITDA, adjusted EBITDA margin, net leverage ratio, cash interest expense, net, and adjusted net cash provided by (used in) operating activities, however, are not measures of financial performance under GAAP and should not be considered a substitute for financial measures determined in accordance with GAAP. Definitions and reconciliations of these items are provided below.
- Adjusted EBITDA is defined as operating income, adjusted to exclude depreciation and amortization of intangible assets, and items that may include, but are not limited to, significant charges or credits, and unusual and infrequent non-operating items that impact current results but are not related to our ongoing operations, such as M&A, integration, and related costs.
- Adjusted EBITDA margin is defined as adjusted EBITDA divided by revenue.
- Adjusted net income is defined as net income, adjusted to exclude items that may include, but are not limited to, significant charges or credits, and unusual and infrequent non-operating items that impact current results but are not related to our ongoing operations, such as M&A, integration and related costs, amortization of acquired intangible assets, amortization of debt issuance costs, and loss on extinguishment of debt.
- Adjusted diluted earnings per share is defined as adjusted net income divided by the weighted average diluted common shares outstanding.
- Cash interest expense, net is defined as interest expense, net adjusted to exclude amortization of debt issuance costs.
- Adjusted net cash provided by (used in) operating activities or adjusted operating cash flow is defined as net cash provided by (or used in) operating activities adjusted to exclude infrequent non-operating items, such as M&A payments and related costs.
- Net leverage ratio is defined as net debt (or total debt less unrestricted cash) divided by trailing twelve-month (TTM) bank EBITDA.
Non-GAAP Tables
|
($K, except per share data) |
Three Months Ended |
|
||||
|
|
|
|
|
|
||
|
Revenue |
|
|
|
|
||
|
Net income |
|
|
|
|
||
|
Plus: |
|
|
|
|
||
|
Income tax expense |
4,594 |
|
1,963 |
|
||
|
Other expense, net |
2,446 |
|
2,295 |
|
||
|
Interest expense, net |
18,125 |
|
19,719 |
|
||
|
Loss on extinguishment of debt |
— |
|
2,214 |
|
||
|
Operating income |
|
|
|
|
||
|
Plus: |
|
|
|
|
||
|
Amortization of intangible assets |
22,900 |
|
22,562 |
|
||
|
M&A, integration and related costs |
13,373 |
|
4,625 |
|
||
|
Adjusted operating income |
|
|
|
|
||
|
Plus: |
|
|
|
|
||
|
Depreciation and CCA amortization |
5,209 |
|
5,476 |
|
||
|
Adjusted EBITDA |
|
|
|
|
||
|
Adjusted EBITDA margin |
6.8 % |
|
6.6 % |
|
||
|
Minus: |
|
|
|
|
||
|
Cash interest expense, net |
16,456 |
|
18,231 |
|
||
|
Income tax expense, as adjusted |
13,366 |
|
9,234 |
|
||
|
Depreciation and CCA amortization |
5,209 |
|
5,476 |
|
||
|
Other expense, net, as adjusted |
2,446 |
|
2,545 |
|
||
|
Adjusted net income |
|
|
|
|
||
|
|
|
|
|
|
||
|
($K, except per share data) |
Three Months Ended |
|
||||
|
|
|
|
|
|
||
|
Diluted earnings per share |
|
|
|
|
||
|
Plus: |
|
|
|
|
||
|
M&A, integration and related costs |
|
|
0.11 |
|
||
|
Amortization of intangible assets |
|
|
0.54 |
|
||
|
Amortization of debt issuance costs and Loss on extinguishment of debt |
|
|
0.09 |
|
||
|
FMV land impairment |
$— |
|
$— |
|
||
|
Gain on acquisition, net |
$— |
|
|
|
||
|
Adjusted diluted earnings per share |
|
|
|
|
||
|
|
|
|
|
|
||
|
Average shares outstanding: |
|
|
|
|
||
|
Basic, as reported |
31,214 |
|
31,590 |
|
||
|
Diluted, as reported |
31,512 |
|
32,021 |
|
||
|
Adjusted diluted |
31,512 |
|
32,021 |
|
||
|
|
|
|
|
|
|
|
Non-GAAP Tables
|
($K) |
Three Months Ended |
|
||
|
|
|
|
|
|
|
Net cash used by operating activities |
$ (129,910) |
|
$ (95,464) |
|
|
Plus: |
|
|
|
|
|
M&A, integration, and related payments |
2,206 |
|
3,008 |
|
|
MARPA facility activity |
105,628 |
|
(25,617) |
|
|
Adjusted operating cash flow |
$ (22,076) |
|
$ (118,073) |
|
|
|
|
|
($K) |
TTM |
|
|
|
|
Net income |
$ 88,700 |
|
Plus: |
|
|
Interest expense, net |
78,316 |
|
Income tax expense |
25,652 |
|
Depreciation and amortization |
112,595 |
|
Additional permitted add-backs1 |
52,097 |
|
TTM Bank EBITDA |
$ 357,360 |
|
|
|
|
($K, except ratio) |
Period Ending |
|
|
|
|
Total debt |
$ 1,100,085 |
|
|
|
|
Cash, cash equivalents and restricted cash |
$ 208,666 |
|
Less: |
|
|
Restricted cash |
(4,014) |
|
Cash and cash equivalents |
$ 204,652 |
|
|
|
|
Net debt |
$ 895,433 |
|
TTM bank EBITDA |
$ 357,360 |
|
Net leverage ratio |
2.51x |
|
____________________________ |
SUPPLEMENTAL INFORMATION
Revenue by contract type, geographic region, contract relationship, and customer for the periods presented below was as follows:
|
Revenue by Contract Type
|
||||||
|
|
|
Three Months Ended |
||||
|
|
|
|
|
|
|
% |
|
(In thousands) |
|
2026 |
|
2025 |
|
Change |
|
Cost-plus and cost-reimbursable |
|
$ 752,405 |
|
$ 623,213 |
|
20.7 % |
|
Firm-fixed-price |
|
372,759 |
|
363,950 |
|
2.4 % |
|
Time-and-materials |
|
128,964 |
|
28,760 |
|
348.4 % |
|
Total revenue |
|
$ 1,254,128 |
|
$ 1,015,923 |
|
|
|
Revenue by
|
||||||
|
|
|
Three Months Ended |
||||
|
|
|
|
|
|
|
% |
|
(In thousands) |
|
2026 |
|
2025 |
|
Change |
|
|
|
$ 810,554 |
|
$ 577,458 |
|
40.4 % |
|
|
|
314,333 |
|
318,345 |
|
(1.3) % |
|
|
|
76,137 |
|
75,978 |
|
0.2 % |
|
|
|
53,104 |
|
44,142 |
|
20.3 % |
|
Total revenue |
|
$ 1,254,128 |
|
$ 1,015,923 |
|
|
|
Revenue by Contract Relationship
|
||||||
|
|
|
Three Months Ended |
||||
|
|
|
|
|
|
|
% |
|
(In thousands) |
|
2026 |
|
2025 |
|
Change |
|
Prime contractor |
|
$ 1,197,462 |
|
$ 962,421 |
|
24.4 % |
|
Subcontractor |
|
56,666 |
|
53,502 |
|
5.9 % |
|
Total revenue |
|
$ 1,254,128 |
|
$ 1,015,923 |
|
|
|
Revenue by Customer
|
||||||
|
|
|
Three Months Ended |
||||
|
|
|
|
|
|
|
% |
|
(In thousands) |
|
2026 |
|
2025 |
|
Change |
|
Army |
|
$ 440,114 |
|
$ 442,136 |
|
(0.5) % |
|
|
|
382,921 |
|
346,118 |
|
10.6 % |
|
|
|
167,833 |
|
99,126 |
|
69.3 % |
|
Other |
|
263,260 |
|
128,543 |
|
104.8 % |
|
Total revenue |
|
$ 1,254,128 |
|
$ 1,015,923 |
|
|
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SOURCE
