Q2 2024 Loar Holdings Inc Earnings Call Transcript
Key Points
- Loar Holdings Inc (LOAR) reported record sales of $97 million for Q2 2024, a 17% increase compared to the prior year.
- Strong performance in Defense (up 57%), commercial aftermarket (up 19%), and commercial OEM (up 11%).
- The company has a diverse portfolio with over 15,000 unique and proprietary parts, ensuring no single part makes up more than 3% of overall net sales.
- Loar Holdings Inc (LOAR) has successfully implemented a strategy to improve visibility and lead times, resulting in a more predictable and stable order backlog.
- The recent acquisition of Applied Avionics is expected to enhance the company's portfolio with high-margin, proprietary products and significant aftermarket exposure.
- Gross profit margin for Q2 2024 was slightly lower than the prior year, primarily due to higher defense sales which typically have lower margins.
- The company is experiencing temporary dilution from an acquisition completed in the second half of 2023.
- Costs related to the move of one of their manufacturing facilities have impacted margins.
- Despite strong sales, the adjusted EBITDA margin decreased to 36%, down from the prior year quarter.
- The company faces challenges in the OEM sector, particularly with Boeing's MAX production rates and supply chain issues affecting Airbus.
Greetings, and welcome to the Loar Holdings, Inc., second-quarter 2024 earnings conference call and webcast. (Operator Instructions) As a reminder, this conference is being recorded.
It's now my pleasure to introduce your host, Ian McKillop, Investor Relations. Please go ahead, Ian.
Thank you and welcome to the Loar Holdings 2024 second-quarter earnings conference call. Presenting on the call this morning are Loar's Chief Executive Officer and Executive Co-Chairman, Dirkson Charles; Executive Co-Chairman, Brett Milgrim; Chief Financial Officer and Treasurer, Glenn D'Alessandro as well as myself, Ian McKillop, the Director of Investor Relations.
As a reminder, please visit our website at loargroup.com to obtain a supplemental slide deck and call replay information.
Before we begin, we would like to remind you that the statements made during this call, which are not historical in fact, are forward-looking statements. For further information about important factors that could
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