Textron Inc. (TXT) Q2 2023 Earnings Call Transcript

For the period ending July 1, 2023

July 27, 2023 8:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Q2, 2023 Textron Earnings Release. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, today's conference is being recorded.

And I would now like to turn the conference over to your host, Vice President of Investor Relations, Eric Salander. Please go ahead.

Eric Salander

Thanks, Kaylie 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 Connor, 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.

Scott Donnelly

Thanks, Eric, and good morning, everyone. 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 expecting to deliver in 2024 and 2025. Also during the quarter, Aviation delivered the first passenger configured Cessna SkyCourier to Lāna’i Air for its Hawaiian interisland routes. On the new product front, Aviation announced the Cessna Citation Ascend at Ebase ph in May. Ascend will feature the latest Garman 5000 avionics suite, 4-passenger range of 1900 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.