Textron Inc.

Ladies and gentlemen, thank you for standing by. Welcome to the Q2 2023 Textron earnings release. At this time, while participants are in a listen-only mode, later we will conduct a question and answer session. If you wish to ask a question, please press 1 and then 0 on your touchtone phone. You will hear an acknowledgement that you've been placed into queue, and you can remove yourself from that queue at any time by repeating the 1-0 command. Should you require assistance during the conference, please press star, then zero, and an operator will assist you offline. As a reminder, today's conference is being recorded, and I would now like to turn the conference over to our host, Vice President of Investor Relations, Eric Salander. Please go ahead.

Thanks, Keeley, and good morning, everyone. Before we begin, I'd like to mention we will be discussing future estimates and expectations during our call today. These forward-looking statements are subject to various risk factors, which are detailed in our SEC filings and also in today's press release. On the call today, we have Scott Donnelly, Textron's chairman and CEO, and Frank Conner, our chief financial officer. Our earnings call presentation can be found in the investor relations section of our website. Revenues in the quarter were $3.4 billion, up $270 million from last year's second quarter. Segment profit in the quarter was $352 million, up $71 million from the second quarter of 2022. During this year's second quarter, we reported income from continuing operations of $1.30 per share. Adjusted income from continuing operations, a non-GAAP measure, was $1.46 per share compared to $1.11 per share in last year's second quarter. Manufacturing cash flow before pension contributions, a non-GAAP measure, totaled $242 million in the quarter compared to $309 million in the second quarter of 2022. With that, I'll turn the call over to Scott. Thanks, Eric, and good morning, everyone.

The second quarter was a strong quarter, with revenue up across all our businesses and solid execution, generating a segment profit margin of 10.3%, up 140 basis points from the second quarter of 2022. At aviation, in the quarter, we delivered 44 jets, down from 48 last year, and 37 commercial turboprops, up from 35 in last year's second quarter. Aviation continues to see solid demand across jet and turboprop products, Backlog grew $315 million, ending the second quarter at $6.8 billion. In the quarter, aviation received an order for 11 Special Mission King Air 360s, expected to deliver in 2024 and 2025. Also during the quarter, aviation delivered the first passenger-configured Cessna SkyCourier to Lanai Air for its Hawaiian inter-island routes. On the new product front, aviation announced the Cessna Citation Ascend at eBase in May. The Ascend will feature the latest Garmin 5000 avionics suite, a four-passenger range of 1,900 nautical miles, comfortable cabin experience with large windows and a flat floor, and the new Pratt 545D engine that features improved thrust and increased time between overhauls and enhanced fuel efficiency. The aircraft is expected to enter into service in 2025. Moving to Bell, revenues were slightly higher in the quarter. Bell began ramping activity on the FLORA program, including onboarding engineers, contracting with major suppliers, and ordering long-lead materials. Bell also added $1.2 billion of backlog related to the FLORA contract during the quarter. Also in the quarter, Bell received an initial contract authorization for four additional V-22 aircraft. On the commercial side of Bell, we delivered 35 helicopters, up from 34 in last year's second quarter. At Textron Systems, we saw continued solid margin performance on slightly higher revenues. In June, systems delivered craft 107 to the U.S. Navy Ship-to-Shore Connector Program. The eighth craft delivered to the Navy. Also during the quarter, systems Aeroson Hybrid Quad UAS was among four competing unmanned aerial systems that were awarded a design contract under the first option of the Army's Future Tactical Unmanned Aircraft Systems Program. Systems also advanced as part of Team Lynx, led by American Rheinmetall, in the next phase of the U.S. Army's XM-30 program, Textron Systems is the designated manufacturer of Team Links. The Army down selected two competitors for the next phase of the program, which includes detail design and prototype builds. Moving to industrial, we saw higher revenues in the quarter driven by higher volume at both Caltechs and Specialized Vehicles. At Specialized Vehicles, we announced the new Liberty LSV, a street legal vehicle powered by our elite battery system with four forward-facing seats. Within Caltechs, we saw increased volumes year-over-year across all our geographic end markets. Moving to e-Aviation, we began wind tunnel testing on the Nexus eVTOL aircraft. These tests represent a significant step in the aircraft development process and supporting design validation activities. Additionally, we continued the prototype assembly and systems integration of the NUVA, our hybrid electric unmanned cargo VTOL aircraft at our facilities in Slovenia. With that, I'll turn the call over to Frank.