Ducommun's Q4 EMS Revenues Fall Despite Broader Gains
SANTA ANA, CA -- Ducommun reported fourth quarter Electronic Systems net revenue of $106.7 million, down from $120 million in 2022 primarily due to lower build rates on various missile platforms and military fixed-wing aircraft platforms.
The company’s commercial aerospace end-use markets slipped $300,000 as well.
Operating income for the current year fourth quarter was $9.8 million, or 9.2% of revenue, compared to $13 million, or 10.8% of revenue, for the comparable quarter in 2022. The year-over-year decrease was primarily due to unfavorable product mix and the loss of manufacturing volume and inefficiencies at the firm's Berryville, AK, production site as operations there are wound down, partially offset by lower restructuring charges.
Adjusted operating income for the fourth quarter of 2023 was $10.9 million, or 10.2% of revenue, compared to $15.5 million, or 12.9% of revenue, in the comparable period last year.
Overall consolidated revenue was $192.2 million for the period ended Dec. 31, up 2.1% over last year. GAAP net income of $5.1 million, down $3 million, and adjusted net income was $10.4 million. Cash flow from operating activities of $26.5 million.
“I am very happy to report that the Company reached an all-time revenue record in 2023 with the previous high-level mark set in 2012. Q4 numbers were also very good as we continue the top-line growth story for Ducommun, led once again by a strong commercial aerospace market recovery,” said Stephen G. Oswald, chairman, president and chief executive. “Quarterly revenue exceeded $190 million for the second consecutive quarter and increased to approximately $192 million, driving record full year revenue of $757 million. Gross margins for the quarter grew 120 bps year-over-year to 21.7% and 130 bps for the full year to 21.6%, as we began realizing some of the benefits from our strategic pricing initiatives and productivity improvements including revenue per employee increasing 16% for the full year 2023 compared to 2022.
Ducommun ended the year with a backlog of approximately $994 million, with military and space backlog up $70 million to $527 million from 2022. The company said it has record bookings from Boeing and Airbus and significant growth in backlog in military and space orders.
