Leonardo DRS, Inc.

Ladies and gentlemen, good day and welcome to the Leonardo DRS third quarter fiscal year 2024 earnings conference call. At this time, all participants are in a listen-only mode. Following the company's prepared remarks, there will be an opportunity to ask questions and instructions will be given at that time. As a reminder, this event is being recorded. I would now like to turn the conference over to Steve Vather, Senior Vice President of Investor Relations and Corporate Finance. Please go ahead.

Good morning, and thanks for participating on today's quarterly earnings conference call. Joining me today are Bill Lynn, our Chairman and CEO, and Mike DePold, our CFO. They'll discuss our strategy, operational highlights, financial results, and forward outlook. Today's call is being webcast on the investor relations portion of the website, where you will also find the earnings release and supplemental presentation. Management may also make forward-looking statements during the call regarding future events, anticipated future trends, and the anticipated future performance of the company. We caution you that such statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Actual results may differ materially from those projected in the forward-looking statements due to a variety of factors. For full discussion of these risk factors, please refer to our latest Form 10-K and our other SEC filings. We undertake no obligation to update any of the forward-looking statements made on this call. During this call, management will also discuss non-GAAP financial measures, which we believe provide useful information for investors. These non-GAAP measures should not be evaluated in isolation or as a substitute for GAAP performance measures. You can find a reconciliation of the non-GAAP measures discussed on this call in our earnings release. At this time, I will turn the call over to Bill.

Bill? Thanks, Steve. Good morning and welcome everyone to the DRS Q3 earnings call. We are pleased with our strong third quarter performance and the continued momentum in the year to date. Our performance exemplifies the entire team's tenacity and dedication. Their steadfast focus in delivering critical technology for our customer is also translating into excellent outcomes for DRS shareholders. I want to express my thanks to the team for their incredible efforts and commend them on their impressive accomplishments to date. Our quarterly results reflect steady customer orders, solid revenue growth, profit expansion exceeding our top line, and improved free cash flow generation. Healthy customer appetite across our differentiated portfolio drove a book-to-bill ratio of 1.3 in the quarter. Demand for our naval network computing, electric power and propulsion, force protection, and advanced infrared sensing technologies were key contributors to our $1.1 billion of bookings for Q3. As a result, backlog marched higher, both on a year-over-year and a sequential basis. Quarterly revenue growth was 16% over last year. We also grew our adjusted EBITDA by 22% and delivered margin expansion of 60 basis points in Q3. Lastly, adjusted diluted EPS was similarly propelled by strong operational execution and up 20% year over year. Shifting to the macro environment, as we expected, our customers began FY25 under a short-term continuing resolution, which currently lasts through December 20th. We do not foresee much of an impact in 2024 from this CR. That said, we are hopeful that Congress passes appropriations in a timely manner to provide our customers with the necessary funding clarity, which is especially important in light of the increasingly complex and elevated global threat environment. Irrespective of the outcome of the election next week, we believe that the robust threat environment will require higher and prolonged U.S. and allied defense investment. Our diverse and platform agnostic portfolio remains well positioned to meet our customers' most challenging mission needs. Shifting to operations, our business continues to enjoy broad-based success as evidenced by the healthy customer demand and innovation milestones achieved this quarter. Let me review a couple of noteworthy items. First, Our strategic rationale for acquiring RADA nearly two years ago continues to be validated, and the business has performed well. The urgency and imperative to protect people and platforms from proliferated airborne threats has only increased. Today, effective air defense is being achieved through a greater quantity of capable and distributed tactical radars versus the traditional, more centralized model. This is similar to what is happening in space with the shift to low-Earth orbit satellites for missile tracking and detection missions. Our tactical radars are being deployed for a diversity of close-in and short-range air defense applications against drones, missiles, and other airborne threats. The global threat environment has reinforced domestic and international interest for our multi-mission tactical radars, which is reflected in our bookings and growth. We are also experiencing robust customer demand, which is reflected across our portfolio. In the quarter, we continued to build on our multi-domain positions in the advanced infrared sensing and network computing markets with several sole source contract awards for follow-on work. One of these contracts includes a $235 million production contract award for naval radars deployed on U.S. surface combat. In addition to fortifying our leading market positions, we are successfully penetrating logical market adjacencies. I am pleased to report that we secured new contract awards to provide customers with our cutting edge over the horizon radar technology. This marks an expansion of our radar portfolio into new sensing modalities for more long range and sophisticated threats. Additionally, we are seeing our infrared sensing capability expand into small tactical drone applications. We look forward to further building on these initial footholds and others in the years to come. Across our business, we are working with strategic partners that share our spirit of innovation and agility. Just a few weeks ago at AUSA, we unveiled a directed energy counter drone capability. This striker-based solution adds to our suite of force protection solutions and integrates a new threat-defeat mechanism to our proven portfolio. I am incredibly proud to note that in as few as eight months, DRS and its team designed, developed, and tested this capability to successfully down Class I, II, and III drone threats at a distance. Our ability to address challenging customer mission requirements and go from concept to operational and production-ready capabilities in a rapid manner sets us apart from the competition. Sticking with innovation, we are advancing the integration of AI into our sensing solutions. In close collaboration with our partners and customers, we recently developed and tested an AI-aided target recognition capability on multiple platforms. Lastly, in our electric power and propulsion business, we remain on track and are making steady progress on the new facility down in Charleston, South Carolina. I also want to highlight that we are performing well on our portion of the Columbia class program. We are delivering to our customers with quality and on schedule. From a financial perspective, we are also seeing the incremental benefit of shifting further into production and executing out of the more attractively priced ship sets. Overall, we are pleased with the strong momentum evident in our year-to-date results, which lays a strong foundation to close out the year. Disciplined adherence to our strategy and rigorous operational execution are fundamental to our long-term success. As I look forward, I'm excited that our agility, innovation, and talented people are sharpening our market-leading positions. With that, let me turn the call over to Mike, who will walk you through our financials in greater detail.