Woodward, Inc.

Thank you for standing by. Welcome to the Woodward Incorporated Second Quarter Fiscal Year 2022 Earnings Call. At this time, I would like to inform you that this call is being recorded for rebroadcast and that all participants are in a listen-only mode. Following the presentation, you are invited to participate in a question-and-answer session. Joining us today from the company are Mr. Tom Gendron, Chairman and Chief Executive Officer, Mr. Mark Hartman, Chief Financial Officer, and Mr. Dan Probasnik, Director of Investor Relations. I would now like to turn the call over to Mr. Probasnik.

Thank you, operator. We'd like to welcome all of you to Woodward's second quarter fiscal year 2022 earnings call. In today's call, Tom will comment on our markets and related strategies, and Mark will discuss our financial results as outlined in our earnings release. At the end of the presentation, we will take questions, For those who have not seen today's earnings release, you can find it on our website at woodward.com. We've included some presentation materials to go along with today's call that are also accessible on our website. An audio replay of this call will be available by phone through May 16, 2022 or on our website. The phone number for the audio replay is on the press release announcing this call as well as on our website and will be repeated by the operator at the end of the call. I'd like to refer to and highlight our cautionary statement as shown on slide three. As always, elements of this presentation are forward-looking or based on our current outlook and assumptions for the global economy and our businesses more specifically, including the expected and potential effects of the ongoing COVID-19 pandemic and net inflationary pressures. These elements can and do frequently change. Please consider our comments in light of the risks and uncertainties surrounding those elements, including the risks we identify in our filings. In addition, Woodward is providing certain non-US GAAP financial measures. We direct your attention to the reconciliations of non-US GAAP financial measures, which are included in today's slide presentation and our earnings release and related schedules. We believe this additional information, financial information, will help in understanding our results. Also, all comparisons made during this call are to the same period of the prior year, unless otherwise stated. Turning to our results for the second quarter. Net sales for the second quarter of fiscal 2022 were $587 million, compared to $581 million, an increase of 1%. Net earnings were $48 million, or 74 cents per share, compared to $68 million, or $1.04 per share. Adjusted net earnings for the second quarter of fiscal 2022 were $47 million, or 72 cents per share. There were no adjustments to earnings in the prior fiscal year second quarter. Net cash provided by operating activities for the first half of fiscal 2022 was $50 million compared to $219 million. Free cash flow was $26 million for the first half of fiscal 2022 compared to $206 million. And adjusted free cash flow was $27 million for the first half of fiscal 2022. Before we turn the call over to Tom to comment further on our results, strategies, and markets, Mark would like to make a brief comment.

Thanks, Dan. As you may have heard, Tom recently announced his retirement from Woodward after more than 31 years with the company. This will be his last earnings call as chairman and CEO. Tom, on behalf of all members and the Woodward Board of Directors, I wanted to thank you for everything you have done for this company. For the past 17 years, your visionary leadership piloted Woodward towards the future, expanding our market capitalization from under $700 million to back in 2005 to approximately $7 billion today. The strategy you set in place in the early 2000s enabled us to achieve extraordinary growth and created significant value for our shareholders. These tremendous accomplishments will be remembered for many years to come. For that, we all thank you. We wish you and Tracy the best of luck in the next phase of your journey.