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Dec 29, 2023
Mercury Q2 2024 Earnings Report
Mercury's financial performance was diminished by program cost growth, manufacturing adjustments, and contract settlements, while making progress in priority areas.
Key Takeaways
Mercury Systems reported Q2 fiscal year 2024 results with bookings of $325.4 million and a book-to-bill ratio of 1.65. Revenue was $197.5 million. The company had a GAAP net loss of $45.6 million and adjusted EBITDA loss of $21.3 million. Operating cash flow was $45.5 million and free cash flow was $37.5 million.
Received near-record bookings of $325.4 million, resulting in a book-to-bill ratio of 1.65.
Delivered $45.5 million in operating cash flow and $37.5 million in positive free cash flow.
Completed an additional four challenged programs.
Consolidated operations into a single, integrated operating unit, expected to deliver $20 million in annual run-rate savings.
Mercury
Mercury
Forward Guidance
For fiscal year 2024, revenues are forecasted to be in the range of $800.0 million to $850.0 million. Bookings are expected to exceed $1 billion. Operating cash flow as well as free cash flow are expected to be positive for the second half of the year and full fiscal year.
Positive Outlook
- Demand remains strong.
- Bookings are expected to exceed $1 billion for the full fiscal year.
- Operating cash flow is expected to be positive for the second half of the year and full fiscal year.
- Free cash flow are expected to be positive for the second half of the year and full fiscal year.
- Covenant net leverage is expected to stay well within the thresholds allowed in our credit agreement for the remainder of the fiscal year.
Challenges Ahead
- Revenue reductions due to program cost growth.
- Lower volumes expected in the second half.
- Operational capacity to advance challenged and late-stage development programs.
- Reduction in full year revenue guidance.
- Uncertainty of timing and range of additional potential actions to settle contractual arrangements or continued adjustments to our cost structure.