Karman Holdings Inc. Q1 FY2025 earnings call

• Three months ago, the company successfully completed its IPO. Since then, it reported record 2024 financial results, refinanced debt, and acquired MTI, adding proprietary capabilities. • In the first quarter, it generated record quarterly revenue of $100 million, gross profit of $39.5 million, adjusted EBITDA of $30 million, fully diluted adjusted earnings per share of $0.05, and a funded backlog of $636 million. • The demand drivers for its business remain strong, with commercial space activity increasing and the U.S. DoD prioritizing certain solutions. • Karman is well - aligned with major space opportunities and strategic national security priorities, and has a deep IP - enabled vertical integration model.

In the first quarter, Karman achieved record quarterly revenue of $100 million. Revenue in the hypersonics and strategic missile defense segment grew from $24.8 million to $30.1 million, a 21.1% increase. Tactical missiles and integrated defense systems revenue rose from $27.9 million to $36.2 million, a 29.6% increase. Space and launch revenue went from $30.3 million to $33.8 million, a 12% increase. The commercially focused space and launch market makes up approximately one third of total revenue, while the two defense - oriented markets account for the remaining two thirds.

• Reaffirms 2025 guidance of total revenue between $423 million and $433 million and adjusted EBITDA between $132 million and $137 million. • As of the end of April, 95% of the 2025 revenue was visible. • Expect approximately 48% of the full - year revenue in the first half of the fiscal year.

• Tariffs: Virtually no items subject to tariffs are procured directly from foreign suppliers, use of rare earths is negligible, and fixed - price contracts minimize pricing risk. However, export tariffs are not a significant risk as direct international sales are less than 1% of revenue. • Government efficiency programs: Karman's value proposition of delivering advanced solutions efficiently is aligned with the goals of government efficiency initiatives, but changes need to be monitored. • Rare earth supply constraints: Minimal impact as the use of rare earths in development, testing, and production processes is negligible.

Q: Michael Fisher asked about whether the SLS program was just quarterly lumpiness and about the variance in space and launch content across customers and programs.

A: Tony Koblinski said SLS is negligible in the forward - looking forecast and there is variance in space and launch content across customers and programs based on product categories such as payload protection, aerodynamic interstage, and propulsion systems.

Q: Peter Arment asked about bookings associated with the Golden Dome and other funding areas.

A: Jonathan Beaudoin said there is a record backlog and 95% revenue visibility, but it is uncertain whether the bookings will occur this year or next.

Q: Stephen Strackhouse asked about the drivers of the EBITDA guidance and about bookings.

A: Tony Koblinski said operating leverage and CapEx initiatives drive the expansion of EBITDA margin, and bookings can be lumpy with a strong pipeline but uncertainty regarding the impact of the Golden Dome.

Q: Bradley Eyster asked about procurement reform.

A: Tony Koblinski said it is in favor of efficiency in the procurement process.

Q: Louie DiPalma asked about the company's exposure to hypersonics and about multi - year visibility.

A: Tony Koblinski said the company is well - embedded in hypersonic development programs and has good discussions with customers about the three - to - five - year outlook.