Amentum Holdings, Inc.

Ladies and gentlemen, thank you for standing by. Good morning and welcome to Amentum's second quarter fiscal year 2025 earnings conference call. Today's call is being recorded. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. And at that time, I would now like to turn the call over to Nathan Rutledge, Senior Vice President of Investor Relations. Please go ahead, sir.

Thank you and good morning, everyone. We hope you've had an opportunity to read the press release we issued yesterday afternoon, which is posted on our investor relations website. We have also provided presentation slides to facilitate today's call. So let's move to slide two. Please note that this morning's discussion will contain forward-looking statements that are subject to important factors that could cause actual results to differ materially from anticipated. I refer you to our SEC filings for a discussion of these factors, including the risk factors section of our annual report on Form 10-K. The statements represent our views as of today, and subsequent events may cause our views to change. We may elect to update the forward-looking statements at some point in the future, but specifically disclaim any obligation to do so. In addition, we will discuss pro forma financial measures prepared in accordance with Article 11 of Regulation SX, as well as non-GAAP financial measures, which we believe provide useful information for investors. Both our press release and supplemental presentation slides include reconciliations to the most comparable GAAP measures. These pro forma and non-GAAP financial measures should not be considered in isolation or as a substitute for financial measures prepared in accordance with GAAP. Our safe harbor statement included on this slide should be incorporated as part of any transcript of this call. With me today to discuss our business and financial results are John Heller, Chief Executive Officer, and Travis Johnson, Chief Financial Officer. We are also joined by other members of management, including Steve Arnett, Chief Operating Officer. With that, moving to slide three, it's my pleasure to turn the call over to our CEO, John Heller.

Thank you, Nathan, and good morning, everyone. We appreciate you joining us today. Welcome to Amentum's second quarter earnings conference call. As we close the first half of the fiscal year, it's rewarding to see the progress we've made notably staying on track with our integration plan and the solid execution of our strategy to enhance our position as a global leader in advanced engineering and technology solutions. Our operational results reflect the strength of our underlying business, the continued demand for our mission-focused capabilities, and our ability to deliver differentiated solutions that help our customers achieve their objectives more efficiently and effectively. We also recently announced the divestiture of our rapid solutions product business, a positive step that is aligned with our core strategy and strengthens our balance sheet position, which I'll discuss in more detail shortly. I'm especially proud of our team working closely with our customers around the globe as we stay focused on our shared vision of advancing critical missions, the disciplined execution of momentum strategy, agile business model and unwavering commitment to our customers missions have enabled us to deliver solid financial results for the second quarter. As shown on slide three, we delivered revenue of $3.5 billion, adjusted EBITDA of $268 million, reflecting 3% year over year growth and free cash flow of $53 million. We are encouraged by our results and understand that long-term success will be driven by discipline execution and by managing variables within our control. By staying focused on these priorities, we are positioning ourselves to deliver sustained growth for our customers and stakeholders. Looking ahead to the second half of the year and beyond, we remain confident in our strategy and our ability to drive long-term growth and superior value for our shareholders. Now, let's move to slide four, which highlights the continued strong demand for Amentum's mission-focused solutions across our diversified end markets. We reported $2.8 billion in net bookings this quarter, resulting in a quarterly book-to-bill ratio of 0.9 times, bringing our year-to-date book-to-bill to one times. As noted on our first quarter earnings call, Awards to unconsolidated joint ventures are excluded from our reported book-to-bill ratio. Including Amentum's proportional share of joint venture revenues and bookings, our year-to-date imputed book-to-bill ratio is a robust 1.2 times. Finally, we ended the quarter with a total backlog of $45 billion, representing 3.2 times our annual revenue. Enduring demand for our work is fueled by Amentum's diverse end market exposure and our proven ability to deliver impactful, mission-focused solutions. This positions us to carry strong momentum in the months and years ahead. In the second quarter, we converted a strong pipeline into new rewards that align with our key growth markets and priority customers. To illustrate this momentum, I'd like to highlight a few notable wins. First, Amentimus awarded multiple intelligence contracts totaling over $1 billion, which are aligned with national security priorities and will deliver a range of innovative mission-focused solutions, including critical infrastructure management, cybersecurity, and intelligence analysis. At Capital Markets Day last August, we called out intelligence as a key market where our combined scale and capabilities will give Amentum a competitive strength. These awards demonstrate the demand for high impact intelligence and cybersecurity solutions, which we expect will drive sustainable growth. This reflects the quality of our work and underscores our expertise in providing high quality security engineering solutions. enabling our customers in their mission to defend and protect our national interest. Second, Momentum was selected as the program manager and lead design engineer for Sizewell C, a new nuclear power station that will strengthen the United Kingdom's energy solutions. We're supporting customers at the forefront of the nuclear renaissance, and we are proud to be part of this mission. It draws directly on our advanced engineering and deep technical expertise to help deliver the next generation in reliable and secure nuclear power generation. This long-term contract will culminate with a station that has two 1.6 gigawatt reactors, enough electricity to power 6 million homes each year. Lastly, I'd like to highlight over $500 million in IDIQ task orders awarded in the quarter, including a program with the Naval Surface Warfare Center. Through this award, we'll apply our proven expertise in electromagnetic environmental effects to strengthen the Navy's decision making in spectrum dominance. Our solutions will enhance battle force interoperability by addressing electromagnetic interference challenges, delivering a strategic edge in naval operations. With extensive capabilities spanning digital transformation, modernization and sustainment, and space systems, and deep relationships across the customer landscape, Momentum is unlocking meaningful cross-selling opportunities. We have positions on more than $450 billion in contract vehicles, many of which span multiple mission areas. These broad scope awards allow us to deliver a wide range of integrated solutions to a single customer under a single task order. Our recent selection to OASIS Plus is a prime example. Covering eight domains from R&D to enterprise solutions, it enables us to align our capabilities with a diverse set of mission requirements. Opportunities like this strengthen customer intimacy and enhance our programmatic alignment, leading to faster value delivery and simpler, more effective solutions. These are just a few examples of our growth success, but we continue to see strength across the broader pipeline. Demand for high-value, mission-focused solutions remains a clear priority for our customers. With our proven differentiated capabilities, strong customer relationships, and deep technical expertise, we are confident in our ability to deliver across the broad set of resilient end markets. We currently have $29 billion in pending awards, and we remain on track to submit over $35 billion for the full fiscal year. Now I'd like to take a moment to address the broader budget and policy environment impacting our market. While we are encouraged by healthy year-to-date demand from across our customer base, we recognize that we're living in a time of rapid transformation. The combination of evolving geopolitical dynamics and the direction of the new administration is reinforcing the need for mission focused solutions, many of which are directly aligned with the momentum strategy and capabilities. On the budget front, visibility is improving. For the fiscal year 2025, we feel confident in our ability to successfully navigate our way through the full year continuing resolution and meet our financial objectives. We've seen positive signals in the defense and border security allocations included in reconciliation bills from both chambers. And while it's still early, last week's release of the fiscal year 2026 White House budget proposal clearly articulates the importance of national security as this administration's top priority. In February, Secretary of Defense Hegseth outlined 17 priority areas for the Department of Defense. These areas are critically important to national security, which is why Amentum is already supporting several of them, including, first, missile defense. We're supporting the Missile Defense Agency's evolving mission through integrated test, training, and operational support under our integrated research and development for enterprise solutions contract as a result we're also well positioned to play a significant role in the development and deployment of the golden dome missile defense initiative second combating transnational criminal organizations We're deploying AI ML powered analytics under our counter narcotics and global threats contract to disrupt the financial networks of cartels and terrorist groups. And at the border where a momentum is enhancing US border surveillance and patrol capabilities through aviation support. Third, nuclear modernization. Advancing strategic radiation hardened microelectronics to improve the resilience of the Navy's nuclear deterrent systems. Finally, through our ITeams contract, Lamentum is advancing U.S. Indo-PACOM mission objectives by enhancing operational readiness and command support in the Indo-Pacific theater. These are just a few examples of how Lamentum is contributing to critical national security priorities today. and where we are well positioned to support future opportunities. Beyond the defense and intelligence markets, we are strategically expanding into enduring missions experiencing rapid growth. We're especially pleased with the strong and consistent growth in our commercial and international markets, which represent 20% of revenue. As I noted earlier, our targeted growth in high potential sectors like nuclear engineering and commercial 5G places us at the cutting edge of evolving markets. At our core, Momentum is in the business of delivering solutions that enable our government and commercial customers to achieve their objectives faster and more effectively. These are capabilities that align with the priorities of any administration or corporation, validating our strategic direction. In short, While the environment remains dynamic, momentum strategy, capabilities, and mission focus position us well for the future. Let's now turn to slide five. Building on the strength of our end market diversification, a little more than two weeks ago, we announced the planned divestiture of our rapid solutions product business, a transaction that illustrates the capital-light nature of our go-to-market strategy and commitment to disciplined balance sheet management. Technology, agnostic capabilities, and solutions are a key ingredient in our strategy to deliver high-impact, high-value solutions that meet customer needs and maintain Amentum's position as the premier pure-play government and commercial services provider. This transaction is an extension and reaffirmation of our existing operating model. This business is better suited to a product-centric model that depends on steady capital investment, an approach that differs from our asset-light, integrated solution-driven model. With a more streamlined portfolio, we are better positioned to pursue opportunities aligned with our core strengths and deliver differentiated value in complex, mission-critical environments. While Travis will speak in detail about the financial benefits of the transaction, I'll note that the divestiture is aligned with our deleveraging objectives, accelerating our ability to flexibly redeploy capital toward value-accretive opportunities. To conclude, I would like to underscore three takeaways from Momentum's second quarter. First, demand for our mission-critical solutions is strong and growing. demonstrated by recent wins, including in the intelligence and environment markets. Second, we're executing with discipline, streamlining our portfolio, advancing our debt reduction goals, and staying focused on markets where we can lead. Third, our integration plan remains firmly on track, positioning us to fully realize the benefits of scale, talent, and capability that our platform brings together. With strong momentum and a clear strategy, I remain confident in our future and excited about the value we are creating for all stakeholders. With that, I'll turn it over to Travis to walk you through the financials in more detail.