The following is a summary of the ESCO Technologies Inc. (ESE) Q2 2024 Earnings Call Transcript:

Financial Performance:

• ESCO Technologies reported a 9% increase in sales for Q2 2024 compared to the same period in the previous year.

• The company had seen growth across its Aerospace, Navy, and Utility businesses.

• Orders declined by 5% compared to Q2 of the prior year, ending with a significant backlog of $838 million.

• Adjusted EBIT rose by 130 basis points to 13.5%, and adjusted earnings per share increased by 24% to $0.94.

• Revenue is expected to exceed $1 billion, a record high for the company, accompanied by a projected growth in adjusted earnings per share of 12%-16%.

Business Progress:

• ESCO conducted strategic planning processes with each subsidiary, aiming for above-market organic growth.

• The company expects a significant future growth in Aerospace & Defense, backed by high levels of backlog and strong top-line sales growth.

• Opportunities arising from an aging electric grid, increasing power demand, and global decarbonization goals could greatly benefit the Utility Group.

• The Test business, despite a tough start, has returned to double-digit profitability in Q2, with new growth expected in 2025.

• The company anticipates mid-upper single-digit organic growth over the planning horizon for the Utility business.

• ESCO is preparing to meet increased demand from Commercial and Defense Aerospace customers, and Navy businesses.

• The company is also considering strategic acquisitions to increase exposure to long-term growth markets.

More details: ESCO Technologies IR

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