V2X, Inc.

Good day and welcome to the V2X fourth quarter 2024 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal conference specialists by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask questions, you may press star then one on your touchtone phone. And to withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Mr. Mike Smith, Vice President of Treasury, Investor Relations, and Corporate Development at V2X. Please go ahead, sir.

Thank you. Good afternoon, everyone. Welcome to the V2X fourth quarter and full year 2024 earnings conference call. Joining us today are Jeremy Wensicker, President and Chief Executive Officer, and Sean Morales, Senior Vice President and Chief Financial Officer. Slides for today's presentation are available on the Investor Relations section of our website, gov2x.com. Please turn to slide two. During today's presentation, managers will be making forward-looking statements pursuant to the safe harbor provisions of the federal securities laws. We review our safe harbor statements in our press release and presentation materials for a description of some of the factors that may cause actual results to differ materially from the results contemplated by these forward-looking statements. The company assumes no obligation to update its forward-looking statements. In addition, in today's remarks, we will refer to certain non-GAAP financial measures because management believes such measures are useful to investors. You can find a reconciliation of these measures to the most comparable measure calculated and presented in accordance with GAAP on our slide presentation and in our earnings release filed with the SEC, both of which are available on the investor relations section of our website. At this time, I would like to turn the call over to Jeremy.

Thank you, Mike, and good afternoon, everyone. Thank you for joining us today. Before we get started, I'd like to recognize the over 16,000 B2X employees for all their contributions, and in particular, their strong performance during the fourth quarter that resulted in record quarterly revenue, adjusted EBITDA, and cash flow. We thank you for all that you've done and continue to do for our nation and our company. Please turn to slide three. In today's call, I'm going to recap the fourth quarter and four-year results and then discuss our positioning and alignment to national security priorities. Our momentum continued into the fourth quarter with revenue increasing 11% year-over-year to $1.16 billion. This was driven by positive growth in all our geographies and noteworthy 27% increase in the Indo-Pacific region. For the full year, revenue grew 9% to $4.3 billion, exceeding the top end of our guidance. Adjusted EBITDA for the fourth quarter and full year was $86.2 million and $310 million, representing 5% and 6% year-over-year growth. Adjusted ETS for the fourth quarter and full year was $1.33 and $4.34, representing 9% and 16% year-over-year growth. Importantly, our focus on debt reduction and cash generation yielded impressive results, with net debt improving $210 million year-over-year. This achievement equates to a 2.6 times net leverage ratio. which provides significant flexibility and optionality for V2X in 2025 and beyond. Total backlog at the end of the year was $12.5 billion, representing a 1.2 times book-to-bill ratio in the quarter. Our focus on growth is demonstrating results, with V2X securing contract wins at over $5.5 billion in 2024. This was a record for the company and builds an excellent foundation from which we can continue to drive revenue, cash flow, and value for our shareholders. Additionally, we are pleased to announce the arrival of Roger Mason, our Chief Growth Officer. Roger brings a wealth of experience and will continue to build on our track record of growth. This move positions V2X exceptionally well for the years to come. In summary, 2024 was a great year for V2X, achieving several milestones and new records for the company. Now I'd like to spend a few minutes and talk about our positioning and how V2X helps customers increase efficiency, reduce costs, modernize capabilities, improve readiness, and strengthen national security. The fact that we are with our customer at every phase of mission execution, primarily as a prime contractor, gives us great intimacy and knowledge of what is happening and insight into evolving requirements. A combination of our unique mission insight, full lifecycle capabilities, and 80-year reputation as a trusted partner is differentiated in yielding results through recent wins and growth in key theaters. For example, in the Indo-Pacific region, V2X is supporting increased mission requirements as DOD continues to identify China as a pacing challenge and is further investing to strengthen our deterrence. Our positioning in the region and our team's strong performance drove revenue growth of 24% in 2024. We expect continued growth building on the requirement for readiness based on the administration's current priorities, funding requests, and demand signals. Turning to the U.S., we continue to ramp up the $3.7 billion Warfighter Training Readiness Solutions Program. This program is critical to national security readiness as it ensures every soldier has the tools required to conduct realistic exercises and training. As the administration has stated, improving lethality, warfighting, and readiness are priorities. We believe V2X is well positioned to meet these priorities. Additionally, And in further support of readiness, V2X was recently awarded two contracts valued at $270 million in aggregate to keep aircraft for the Drug Enforcement Administration and the Federal Bureau of Investigation fully mission-ready and able to meet evolving operational demands. I would also like to call out our growing position in the Arctic. and how under a contract valued up to $3.95 billion with the U.S. Space Force, V2X is supporting the DoD's strategic initiatives and interests in the region by delivering solutions that will enable our customer to meet new challenges as the region is becoming a venue for strategic competition. Finally, the situation in the Middle East continues to evolve. V2X is uniquely positioned in the region with deep mission intimacy and operational expertise to continue delivering best-of-breed, cost-effective solutions that enable successful outcomes. In summary, V2X is positioned in key theaters with the ability to deliver comprehensive end-to-end capabilities throughout the entire mission lifecycle. This provides us with the opportunity to be part of strategic initiatives for the U.S. government as they protect the homeland and focus on deterrence. Please turn to slide four. Not only does V2X have the global scale and capability to support national security priorities, we have a track record of enhancing outcomes and increasing value for our customers through innovation, modernization, and improved operational performance. This is squarely aligned with the focus area of the new administration and the DoD. The current challenges our customers face are very real, with having to prepare for today while planning for the threats of tomorrow, all while facing approximately $240 billion of already deferred maintenance on its equipment and facilities. This deferred maintenance must be addressed in order to maintain readiness. We believe V2X is extremely well positioned to help the DoD solve these challenges. For example, we are delivering innovative solutions and mission-ready technologies by leveraging our operational know-how and technology expertise. This includes our smart warehouse solution, which can improve space utilization by 90%, increase storage capacity by 77%, and importantly, yield a 69% reduction in operating costs. The net benefit to the DoD is not just cost savings and footprint rationalization, but also significantly improving visibility of unaccounted inventory and assets and enhancing readiness. When we think about the DoD's $1.2 trillion of asset base, spanning over 700,000 facilities, we believe there is a tremendous opportunity for audit assurance and value creation for our customers. Additionally, our platform modernization and rapid prototyping solutions are fielding new systems in months, bringing upgraded technology to platforms with significant cost and scheduled benefits. This includes the very recent example where V2X is delivering rapid response prototyping, production, and sustainment of countered unmanned aerial systems and air defense solutions that solve complex and evolving battlefield threats. We are also seeing demand signals and opportunities to utilize this system in the Indo-Pacific region. Lastly, our utilization of technology, predictive and preventive maintenance, data analytics, and continuous improvement have resulted in V2X generating over $65 million of savings through optimized operational performance to the DoD on several Cost Plus programs. These deliberate and purposeful efforts provide customers with additional funding to support the requirements, while maintaining the highest level of mission readiness and performance. This performance makes V2X a trusted partner of choice for missions of consequence. As you can see, V2X is shoulder-to-shoulder with our customers with a proven track record of bringing cost-effective and value-added solutions. Let's turn to slide five. Later this year, V2X will celebrate its 80th anniversary. This is a major milestone and an important trait of our business. For 80 years, V2X has played a critical role supporting our customers' most important missions around the globe. This includes helping establish the Distant Early Warning Line Radar Network back in the 1950s, which was located above the Arctic Circle and was critical to enhancing our readiness and national security during the Cold War. We have continued to grow since that time, investing and expanding our capabilities. This has and is enabling V2X to do more and offer technology-based solutions that prevail on the battlefield and in real mission environments. For example, today we are leveraging our global expertise in spectrum engineering, information technology, cyber, and network communications to deliver a private and secure mission-ready communication solution in the remote regions of the Indo-Pacific. This V2X technology is assuring connectivity and readiness for our warfighters. From the Arctic to Asia and all around the globe, V2X's comprehensive full-life cycle solutions and relatively fresh brand that's backed by a long legacy is allowing us to bring new technologies, innovation, and force-multiplying solutions to our customers. Turning to the right-hand side of the slide, I'd quickly like to call out our 2024 revenue diversification across defense, intelligence, and commercial markets. We thought it important to note that only 5% of our revenue is derived from federal civilian agencies, primarily centered on border security, drug enforcement, and human spaceflight. Moving to our mix of contracts, as you can see, approximately 60% of our 2024 revenue is generated from cost-plus programs and 40% from fixed price. We continue to work with our customers to convert appropriate contracts and programs to fixed price. We welcome the recent emphasis on outcome-based contracting and believe our institutional knowledge presents a compelling opportunity for V2X and our customers. Please turn to slide six. In the prior slides, I discussed why we believe V2X is well-positioned for continued growth and performance. Our strategy is very clear, and it's to deliver full lifecycle capabilities in support of national security priorities that enhance mission effectiveness, extend asset utilization, reduce costs, and improve security and mission outcomes. Our focus on readiness of the warfighter via training, equipping, deploying, supporting, and modernizing, we believe is well aligned to the current administration and future needs of the DOD. When it comes to government efficiencies, we have described how V2X is already executing and supporting these initiatives, and we believe we can do more. For example, V2X keeps over 1,600 aircraft flying and ready for their next mission. Today, the DoD currently has over 13,000 aircraft in its inventory, excluding unmanned vehicles. We believe V2X has the opportunity to gain additional market share by helping the DoD improve readiness and mission-capable rates of the fleet while creating additional cost savings through outsourcing. Additionally, V2X is utilizing technology and internally investing through R&D to modernize assets and platforms, extending their lives, and enabling our customers to close the gap on the $240 billion of deferred maintenance. In terms of overall budgetary environment, B2X has demonstrated performance throughout various economic and political cycles. This is due to our strategic focus on supporting critical and enduring missions. At the global level, the overall threat environment remains elevated with tensions persisting, if not escalating. This is why the DRD is focused on reestablishment of deterrence. The fact that we have presence and mission intimacy and key theaters and geographies that matter positions us exceptionally well to continue delivering end-to-end full lifecycle solutions to support evolving requirements. What we do is 24-7, 365, supporting missions of consequence around the globe. It's something we are extremely proud of and something that cannot be easily replicated. To wrap up, our 2024 results demonstrate the value of V2X brings to our customers, our positioning in key theaters, alignment to missions of high consequence, and our ability to execute on our commitments. We are excited about the future. The trend and leading indicators in our business remain strong, with a $12.5 billion backlog, limited recompete, and a robust pipeline of new opportunities. We look forward to the opportunity V2X has to increase our percentage of a large addressable market and bring more solutions to meet our customers' mission requirements. Now I'd like to turn the call over to Sean for a review of the financials. Sean?