Ducommun Incorporated Reports Results for the Third Quarter
SANTA ANA, Calif. — Ducommun Incorporated (NYSE:DCO) (“Ducommun” or the “Company”) reported results for its third quarter ended September 28, 2019.
Third Quarter 2019 Highlights
- Revenue increased 13.3% year-over-year to $181.1 million
- Net income of $8.3 million, or $0.70 per diluted share
- Gross margin increased 170 basis points year-over-year to 21.2%
- Operating margin increased 380 basis points year-over-year to 8.1%
- Adjusted EBITDA increased 30.8% year-over-year to $23.6 million
- Acquired Nobles Worldwide, Inc. (“Nobles”) subsequent to quarter end
“I am very happy with the 3rd quarter results and continued strong performance of the company. We now have had five straight quarters of double digit revenue increases averaging 15% with over 85% of the gains being organic growth,” said Stephen G. Oswald, chairman, president and chief executive officer. “Our team continues to do an excellent job as well, relentlessly driving performance and cost through our Performance Center strategy expanding operating margins in the quarter by 380 basis points to 8.1% and achieving earnings of $0.70 per diluted share. Our strong performance also reflects ongoing demand for Ducommun’s broad array of engineering processes, products and aftermarket services along with pricing discipline. Adjusted EBITDA was also strong increasing almost 31% year-over-year to $24 million, and we generated $12.0 million in cash from operations, while our backlog remains near record levels.
“In addition and after the end of the quarter, I was pleased to announce that Ducommun had acquired Nobles Worldwide, a global leader in the design of ammunition handling systems. Nobles has been in business for over 70 years and supplies advanced tactical products for a variety of aircraft, naval vessels, and military vehicles in the U.S. and overseas. It’s a great fit for Ducommun’s defense platform opening new market opportunities while adding on another value-added, engineering products company with aftermarket support. Like our other two recent acquisitions, we believe Nobles will improve our growth profile, help expand margins and bolster our aftermarket services.
“As we look forward, we remain confident on a strong finish for 2019 and continued momentum in 2020 despite the continued uncertainty on the Boeing 737 Max return to service. We see great balance in the portfolio with our defense business and the many other commercial platforms we serve to deliver for Ducommun shareholders. Our team is also energized for the opportunities ahead.”