諾斯洛普·格拉曼 (NOC) 2024 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to Northrop Grumman's Third Quarter 2024 conference call. Today's call is being recorded. My name is Josh, and I'll be your operator today. At this time, all participants are in a listen only mode. I would now like to turn the call over to your host, Mr. Todd Ernst, Vice President, Investor Relations. Mr. Ernst, please proceed.

女士們、先生們，美好的一天，歡迎參加諾斯羅普格魯曼 2024 年第三季電話會議。今天的通話正在錄音。我叫喬什，今天我將成為您的接線生。此時，所有參與者都處於只聽模式。現在我想將電話轉給東道主投資者關係副總裁 Todd Ernst 先生。恩斯特先生，請繼續。

Thanks, Josh, and good morning, everyone, and welcome to Northrop Grumman's Third Quarter 2020 for a conference call .

謝謝喬什，大家早上好，歡迎參加諾斯羅普格魯曼公司 2020 年第三季的電話會議。

Before we start matters discussed on today's call, including guidance and outlooks for 2024 and beyond. Reflect the company's judgment based on information available at the time of this call may constitute forward-looking statements pursuant to safe harbor provisions of federal securities laws for looking statements involve risks and uncertainties, including those noted in today's press release and our SEC SEC filings for risks and uncertainties may cause actual Company results to differ materially.

在我們開始之前，我們先討論今天電話會議討論的事項，包括 2024 年及以後的指導和展望。反映公司根據本次電話會議時可獲得的資訊所做的判斷可能構成根據聯邦證券法安全港條款的前瞻性陳述，因為這些陳述涉及風險和不確定性，包括今天的新聞稿和我們向美國證券交易委員會(SEC) 提交的文件中指出的風險和不確定性。

Today's call will include non-GAAP financial measures that are reconciled to our GAAP results in our earnings release. Third quarter results reflect the realignment of the STS. division from Space Systems to defense systems. In addition, we will refer to our presentation that is posted on our Investor Relations website. On the call today are Kathy Warden, our Chair CEO and President, Dave Keffer, our CFO through September 30th, and can crews our CFO as of the first of this, not at this time, I'd like to turn the call over to Kathy. Kathy? Thanks, Todd.

今天的電話會議將包括與我們收益發布中的 GAAP 業績一致的非 GAAP 財務指標。第三季業績反映了 STS 的調整。從太空系統到防禦系統的部門。此外，我們將參考發佈在投資者關係網站上的簡報。今天參加電話會議的有我們的主席兼首席執行官兼總裁Kathy Warden，以及我們的首席財務官Dave Keffer，其任期將持續到9 月30 日，並且可以從第一天起就為我們的首席財務官提供服務，但不是現在，我想將電話轉給凱西。凱西？謝謝，托德。

Good morning, everyone, and thank you for joining us. We delivered strong operating performance again in this third quarter, building on the momentum we achieved through the first half of the year. Global events continue to highlight the need for advanced capabilities to defend indicator against increasingly complex threats. This is driving the demand for our differentiated portfolio and is evident in our results in the third quarter.

大家早安，感謝您加入我們。在上半年取得的勢頭的基礎上，我們在第三季度再次實現了強勁的經營業績。全球事件不斷凸顯需要先進的能力來防禦日益複雜的威脅。這推動了對我們差異化產品組合的需求，這在我們第三季的業績中顯而易見。

Our book-to-bill was once again very strong sure of backlog to a new record level. Our backlog is now [$85 billion], which is more than two times our annual revenue supporting our confidence in the future growth of this business, revenue has increased 6% year to date, and we are on track to achieve our full year guidance of 5% growth.

我們的訂單出貨量再次非常確定積壓訂單將達到新的紀錄水準。我們的積壓訂單目前為 [850 億美元]，是我們年收入的兩倍多，這支持了我們對這項業務未來增長的信心，今年迄今收入已增長 6%，我們有望實現全年指導5%的增長。

The Northrop Grumman team continues to deliver critical capabilities for our customers remained disciplined in new business pursuits and drive cost efficiencies in our operations, resulting in a strong performance segment, operating margins significantly increased both sequentially and year over year to 11.5% this quarter. Our highest margin rate in over two years. Solid sales volume and strong operating performance drove earnings per share of $7 in the quarter, an increase of 13% from last year's Q3 results.

諾斯羅普·格魯曼團隊繼續為我們的客戶提供關鍵能力，在新業務追求中保持紀律，並提高我們營運的成本效率，從而形成強勁的業績部門，本季營運利潤率環比和同比大幅增長至11.5%。我們的保證金率是兩年多來的最高水準。穩健的銷售和強勁的營運業績推動本季每股收益達到 7 美元，比去年第三季的業績成長 13%。

Free cash flow of $730 million was in line with our expectations and continues to provide us with considerable flexibility to deploy capital in support of both growing our business and our shareholder return strategy. Based on our solid year-to-date results and full year outlook, we are increasing our EPS guidance range by $0.75. We are pleased with this performance because it's a direct result of the intentional steps we've been taking to realize continued growth and enhanced profitability. We continue to implement productivity and efficiency initiatives, including advanced production capabilities, digital engineering tools and increased Auto Nation. We are streamlining processes, reducing rework and improving our learning curve as we add scale, resulting in improved program and operating performance. The impact of these initiatives was again evident this quarter at a U.S. were execution was outstanding. The mature production portion of a U.S. portfolio comprises more than half of its overall revenue, and it continues to perform very well. The B. 21 program has also made solid progress in achieving ground and flight testing milestones on the development contract and is continuing to execute the aircraft production contract in line with our estimates our third quarter in a row of 10% or better margins at AS. due largely to our focus on total cost management and productivity. This performance was also excellent in the quarter as we expected, revenue was down modestly year over year based on the wind down of NGINI. restricted program, but earnings were up substantially. Strong program performance was the key driver as the team executed well, mitigating risks and realizing opportunities leading to improved EAC. trends in recent quarters. Our Defense Systems business continues to see broad-based demand with a book-to-bill of 1.6 times in the quarter. Building the foundation for future growth margin performance year to date is solid and consistent with our full year outlook, while the timing of some of our shorter cycle programs affected sales this quarter. Looking forward, the U.S. is expected to be one of our fastest growing segment with margin expansion opportunities as we realized increased international sales.

7.3 億美元的自由現金流符合我們的預期，並繼續為我們提供相當大的靈活性來部署資本，以支持我們的業務成長和股東回報策略。根據我們今年迄今的穩健業績和全年展望，我們將 EPS 指導範圍上調了 0.75 美元。我們對此業績感到滿意，因為這是我們為實現持續成長和提高獲利能力而採取的有意措施的直接結果。我們持續實施生產力和效率舉措，包括先進的生產能力、數位工程工具和增強的 Auto Nation。隨著規模的擴大，我們正在簡化流程、減少返工並改善我們的學習曲線，從而提高計劃和營運績效。本季度，這些措施的影響在美國再次顯現，執行情況非常出色。美國投資組合的成熟生產部分佔其總收入的一半以上，並且繼續表現良好。 B.21 專案在實現開發合約的地面和飛行測試里程碑方面也取得了紮實的進展，並根據我們的估計繼續執行飛機生產合同，AS 的利潤率連續第三季度達到 10% 或更高。這主要歸功於我們對總成本管理和生產力的關注。正如我們預期的那樣，本季的業績也非常出色，但由於 NGINI 的退出，收入同比小幅下降。計劃受到限制，但收益大幅上升。強大的計劃績效是關鍵驅動力，團隊執行良好，降低了風險並抓住了機會，從而改善了 EAC。最近幾季的趨勢。我們的國防系統業務繼續看到廣泛的需求，本季的訂單出貨比為 1.6 倍。迄今為止，為未來的成長利潤率業績奠定了堅實的基礎，並且與我們的全年展望一致，而我們一些較短週期計劃的時間安排影響了本季度的銷售。展望未來，隨著我們實現國際銷售額的增加，美國預計將成為我們成長最快的市場之一，並具有利潤擴張的機會。

Like at the U.S., we also see continued strong demand at Mission Systems segment also had a book-to-bill of 1.6 times in the quarter and robust 7% revenue growth. Mission Systems as a leader in technology that's in high demand from our customers is reflected in their top line results. And as we've seen this business grow, we've seen mix and productivity pressures including and supply chain deliveries. The team is making good progress with the deliberate actions they've been taking to improve program performance and drive cost efficiencies. And I have confidence that we are on track to achieve higher EBITDA margin in 2025. As we look forward, we see multiple trends across our portfolio that are supportive of continued margin expansion, including improving macroeconomic conditions, stabilizing supply chain, enhanced workforce productivity and gradual shift in our contract mix. As a number of our largest programs transition to production and we build our international portfolio. We also expect to see continued strong demand for the platform, sensors and systems we provide that allow our customers to deter add the series and operate in the most demanding threat environment. This demand is reflected in US budget for national security priorities. And as a result, we are seeing upward pressure on defense budgets over the past several months. The Senate defense authorization and appropriations legislation proposed additional funding above the administration's fiscal year 2025 defense budget request. And while the legislative process is still playing out, it is encouraging to see strong support for both the budget and our program. As we look at markets outside the US, we continue to expect our international sales to grow faster than the rest of our business over the next several years. There is robust. International demand for defense capabilities, particularly in Europe were most NATO members are increasing in defense spending from 2022 levels. This demand is reflected in our international book to bill, which was almost two times in the third quarter. While executing on our current programs is an important driver of our profitable growth outlook. We also remain focused on winning new development programs. Our strategy is based on continuing to deliver technical innovations to create competitive advantage for our customers. A great example of this is our selection by the Missile Defense Agency to develop the glide phase interceptor or GPRI. technology will address increasingly sophisticated hypersonic missile threats. In addition, this program is a collaboration between the U.S. and Japan and will further strengthen the alliance with Japan and further NGs partnership with Japanese industry. Putting all this together, as we look forward to 2025, we expect solid growth and strong performance to continue based on our record backlog and continued focus on program execution. At a company level, we project sales growth between 3% and 4%. This includes strong growth in three or F. four segments. For space. We expect a mid single digit decline due to the wind down on programs are referred to earlier. We continue to expect the company segment operating margin to improve in 2025, driven by favorable macro trends, program performance and cost discipline. Our free cash flow outlook is consistent with our prior long-term forecast, with 2025 increasing greater than 20% year over year. Investing in our growing business remains a priority. We are coming through a period of peak CapEx and anticipate reduced spending level in 2025, but still at a level above historical norms. And given our Company's strong free cash flow outlook, we plan to continue our shareholder-friendly capital deployment strategy, returning approximately 100% of free cash flow to shareholders next year. Dynamic global environment calls for our industry to offer our customers the technology innovations they need to compete for Northrop Grumman continues to invest in the capabilities and capacity needed to deliver that competitive edge for them . We are also intensely focused on the talent in digital infrastructure that enables our performance and competitive differentiation. Our team is delivering today while also building for our future. Financially. This is translating into solid results. Now I plan to rapidly expand cash flows over the next several years. And a business that is well positioned for profitable growth for the foreseeable future. Before turning things over, I'd like to welcome Ken Cruse, who became our CFO on October first. Ken will talk through our forward outlook in just a moment. But first, I'll turn the call over to Dave for a discussion of our Q3 results. And as I do so recognizing this will be his last call, I'd like to thank Dave for his leadership and outstanding service to our company. Dave, over to you.

與美國一樣，我們也看到任務系統部門的需求持續強勁，本季訂單出貨比達到 1.6 倍，營收成長強勁 7%。 Mission Systems 作為技術領導者，客戶的高需求反映在他們的最高績效中。隨著我們看到這項業務的成長，我們也看到了混合和生產力壓力，包括供應鏈交付。該團隊為提高專案績效和提高成本效率而採取的深思熟慮的行動正在取得良好進展。我相信，我們預計在2025 年實現更高的EBITDA 利潤率。 、提高勞動生產力和我們的合約組合逐漸轉變。隨著我們許多最大的項目過渡到生產，我們建立了我們的國際產品組合。我們還期望看到對我們提供的平台、感測器和系統的持續強勁需求，使我們的客戶能夠阻止添加該系列並在最苛刻的威脅環境中運行。這項需求反映在美國國家安全優先預算。因此，過去幾個月我們看到國防預算面臨上行壓力。參議院國防授權和撥款立法提議在政府 2025 財政年度國防預算請求之上提供額外資金。雖然立法進程仍在進行中，但令人鼓舞的是，預算和我們的計劃都獲得了強有力的支持。當我們著眼於美國以外的市場時，我們仍然預計未來幾年我們的國際銷售額成長速度將快於我們的其他業務。有健壯。國際上對國防能力的需求，特別是在歐洲，大多數北約成員國的國防支出從 2022 年的水準開始增加。這種需求反映在我們的國際訂單到帳單上，這幾乎是第三季的兩倍。執行我們目前的計劃是我們獲利成長前景的重要驅動力。我們也繼續致力於贏得新的開發項目。我們的策略基於持續提供技術創新，為客戶創造競爭優勢。一個很好的例子是飛彈防禦局選擇我們開發滑翔階段攔截器或 GPRI。科技將應對日益複雜的高超音速飛彈威脅。此外，該計劃是美國和日本之間的合作，將進一步加強與日本的聯盟以及NGs與日本工業界的進一步夥伴關係。綜上所述，展望 2025 年，我們預計基於創紀錄的積壓訂單和對專案執行的持續關注，我們將繼續實現穩健成長和強勁業績。在公司層面，我們預期銷售額將成長在 3% 至 4% 之間。這包括三、四線市場的強勁成長。為了空間。我們預計，由於前面提到的計劃的結束，將出現中等個位數的下降。我們繼續預計，在有利的宏觀趨勢、計畫績效和成本控制的推動下，該公司部門的營業利潤率將在 2025 年有所改善。我們的自由現金流前景與我們先前的長期預測一致，2025 年年增超過 20%。投資我們不斷成長的業務仍然是首要任務。我們正在經歷資本支出高峰期，預計 2025 年支出水準會有所下降，但仍高於歷史正常水準。鑑於公司強勁的自由現金流前景，我們計劃繼續實施有利於股東的資本配置策略，明年將約 100% 的自由現金流返還給股東。動態的全球環境要求我們的產業為客戶提供競爭所需的技術創新。我們也高度關注數位基礎設施領域的人才，這些人才使我們的業績和競爭優勢得以實現。我們的團隊在交付今天的同時也在為我們的未來而建立。財務上。這正在轉化為堅實的成果。現在我計劃在未來幾年內迅速擴大現金流。而該業務在可預見的未來已做好獲利成長的準備。在扭轉局面之前，我想先對 Ken Cruse 表示歡迎，他於 10 月 1 日就任我們的財務長。肯稍後將介紹我們的未來展望。但首先，我會將電話轉給戴夫，討論我們第三季的業績。當我意識到這將是他的最後一次通話時，我要感謝戴夫的領導和對我們公司的出色服務。戴夫，交給你了。

Thanks, Kathy. It's been incredibly rewarding five years in this role than enjoyed the opportunity to work with you. Tim and the whole Northrop Grumman team from company to continue this group is growing for now. Looking at the Q3 results, we continued to experience enduring demand for our capabilities in support of our US and international customers.

謝謝，凱西。與您一起工作的機會相比，擔任這個職位的五年是非常有意義的。蒂姆和諾斯羅普格魯曼公司的整個團隊目前正在壯大。從第三季的業績來看，我們繼續感受到對我們支持美國和國際客戶的能力的持續需求。

As Kathy mentioned, backlog hit a new record of $85 billion, driven by another quarter of strong bookings are international awards were particularly strong in Q3 of $2.7 billion, increasing or international backlog to almost $8 billion, the highest level in several years. She awards included additional E-2D aircraft for Japan ammunition, an urgent need capabilities of the U.S. and radar programs with them. As we continue to have a wide range of opportunities in our global pipeline that we're optimistic we can convert into bookings and revenue over the coming years.

正如Kathy 所提到的，積壓訂單創下了850 億美元的新紀錄，這是由於第三季國際獎項的預訂量特別強勁，達到27 億美元，這使得國際積壓訂單增加到近80 億美元，這是幾年來的最高水準。她授予的獎項包括為日本提供彈藥的額外 E-2D 飛機、美國急需的能力以及雷達項目。由於我們在全球管道中繼續擁有廣泛的機會，我們樂觀地認為，我們可以在未來幾年將其轉化為預訂量和收入。

Turning to sales on slide 4. In our earnings deck. Strong momentum from the first half of the year continued in Q three throughout most of our portfolio. Sales increased by 2% in the quarter and are up 6% year to date. Q3 sales were slightly below our expectations due to a few delivery timing shifts to Q4, primarily in the US. Both do not impact the full year outlook. Starting with aeronautics, Q3 sales were $2.9 billion, up by 4% compared to the prior year.

轉向投影片 4 中的銷售。我們的大部分投資組合在第三季度延續了上半年的強勁勢頭。本季銷售額成長 2%，年初至今成長 6%。由於交貨時間有一些調整（主要是在美國），第三季的銷售額略低於我們的預期。兩者均不會影響全年前景。從航空領域開始，第三季銷售額為 29 億美元，比上年成長 4%。

The increase was driven by higher volume on of 35 E2 and Tritan, partially offset by slightly lower sales on restricted programs that Defense Systems third quarter sales increased by 2%. Higher sales on Sentinel and from our weapons portfolio drove the increase. As I know, total sales would have been even stronger, if not for a shift into Q4, roughly $150 million of international ammunition sales that are in our backlog on Sentinel. We continue to partner with the Air Force on the restructure of the program, which resulted in adjustments to the timing of certain activities as we refine the latest program schedule. Mission Systems sales were particularly strong in Q3, up 7% compared to the prior year.

這一增長是由 35 E2 和 Tritan 銷量增加推動的，但部分被受限項目銷量略有下降所抵消，國防系統公司第三季度銷售額增長了 2%。 Sentinel 和我們武器產品組合的銷售增加推動了這一成長。據我所知，如果不是進入第四季度，我們在 Sentinel 上積壓的國際彈藥銷售額約為 1.5 億美元，那麼總銷售額將會更加強勁。我們繼續與空軍合作重組該計劃，從而在完善最新計劃時間表時調整了某些活動的時間表。任務系統銷售在第三季尤其強勁，與去年同期相比成長了 7%。

Amazon increase in sales throughout much of its portfolio led by higher volume of microelectronics and advance technology programs. Since these sales were lower by 3%, consistent with our expectations due to a headwind of $224 million in the period from the wind-down of our work on the restricted space and NGI programs. The remaining space portfolio grew at mid single digits, driven by higher sales of SBA satellite programs and other the restricted work. Moving to the bottom line, Q. threes segment operating income expanded to 11.5%.

由於微電子和先進技術專案數量的增加，亞馬遜大部分產品組合的銷售額均有所成長。由於我們在有限空間和 NGI 專案上的工作結束期間出現了 2.24 億美元的逆風，因此這些銷售額下降了 3%，這與我們的預期一致。受 SBA 衛星計畫和其他限制性工作銷量增加的推動，剩餘的太空投資組合以中等個位數成長。轉向淨利潤，第三季營業收入擴大至 11.5%。

This performance was enabled by our continued focus on cost efficiencies, risk retirements, and outstanding program performance. Operating income grew by 5%, generating an excellent operating margin rate of 10.4% in Q. three DS. generated solid performance in the period with operating income modestly lower than the prior period. Q3 operating margin rate included fewer net EAC adjustments and the change in contract mix. Mission Systems operating income increased 1% and its margin rate improved from the first half of the year to 13.8% in space delivered a great quarter with operating income up 14% and and and OM. rate of 12%. We continue to see improvements in spaces program performance based on Black the level of net favorable earnings adjustments in the period.

這一業績得益於我們持續關注成本效率、風險消除和出色的計劃績效。 DS 第三季營業收入成長 5%，營業利益率達 10.4%。期內業績穩健，營業收入較上期略有下降。第三季營業利潤率包括較少的淨 EAC 調整和合約組合的變化。任務系統公司的營業收入成長了 1%，其利潤率從上半年提高到了 13.8%，該季度營業收入成長了 14%，OM 表現出色。率為12%。我們繼續看到基於布萊剋期間淨有利收益調整水準的空間計畫績效的改善。

Turning to Slide 6. Earnings per share in Q3 increased by 13%, driven by the solid segment performance on described as well as from higher net pension income. A lower federal tax rate and strong performance in our marketable securities portfolio also provided an uplift for Q3 tax rate benefit from a net reduction in certain reserves in the period. Keep in mind for EPS comparison purposes than in the third quarter of last year, we recognized a gain of $0.44 per share associated with the sale of a minority investment. Lastly, I'll take a moment to discuss our cash performance. Third quarter, free cash flow was $730 million, in line with our expectations year to date. We remain ahead of our free cash flow position compared to this time last year, and we expect a strong quarter of cash generation in Q4, consistent with our historical pattern. And with that, I'll hand it off to you, Ken.

轉向幻燈片 6。較低的聯邦稅率和我們有價證券投資組合的強勁表現也因該期間某些準備金的淨減少而提高了第三季的稅率收益。請記住，出於去年第三季每股收益比較的目的，我們確認與出售少數股權投資相關的每股收益為 0.44 美元。最後，我將花點時間討論我們的現金表現。第三季自由現金流為 7.3 億美元，符合我們年初至今的預期。與去年同期相比，我們的自由現金流狀況仍然領先，我們預計第四季度的現金流將強勁，這與我們的歷史模式一致。這樣，我就把它交給你了，肯。

Thanks, Dave, and good morning, everyone. I'll spend a few moments on the forward outlook beginning with our later this segment guidance on Slide 7. In our earnings deck or not, it's continues to perform at a high level and as a result, we are increasing both this margin and sales rate guidance. We now expect sales of roughly $12 billion, reflecting a year-over-year increase of 11%. With another quarter of strong operating performance, we are increasing its operating margin rate guidance to approximately 10% of this increase reflects our confidence in this business to generate healthy margins even as B. 21 s cales. At VS, we are modestly lowering our sales guidance to the high $8 billion range, reflecting a mix mid single digit year over year growth rate.

謝謝戴夫，大家早安。我將花一些時間來討論前瞻性展望，從我們稍後在幻燈片7 上的這一細分市場指南開始。正在增加這一利潤率和銷售額率指導。我們目前預計銷售額約 120 億美元，年增 11%。隨著另一季的強勁營運業績，我們將營運利潤率指引提高至約 10%，這一增幅反映了我們對這項業務即使在 B.21 規模擴大時也能產生健康利潤率的信心。在 VS，我們將銷售指導小幅下調至 80 億美元的高位，反映出同比中個位數的混合成長率。

This update reflects our latest expectations for lower simple volume this year, driven by timing conducted with the programs restructure, and we are increasing our margin rate guidance at this space to the mid to high 10s percent range, while updating our expectations margin rate at M s to high 13%. Moving the company level guidance, we are reaffirming our full year sales guidance at the midpoint of the range. This represents a sequential increase in sales to roughly $10.9 billion in Q4, similar to the ramp we experienced during the fourth quarter of 2023.

此次更新反映了我們對今年簡單交易量下降的最新預期，這是由計劃重組的時機推動的，我們正在將這一領域的保證金率指導提高到百分之十的中高範圍，同時更新我們對M 的預期保證金率高達13%。在公司層面的指導上，我們重申全年銷售指引處於範圍的中點。這意味著第四季銷售額環比成長至約 109 億美元，與 2023 年第四季的增幅類似。

Fourth quarter sales will be driven by higher volume of Albert Phase IB. 21, international ammo deliveries at CES and multiple production programs at the MS. Based on our successful execution of cost savings initiatives and our strong program performance, we are increasing the lower end of our segment operating income range to four. Margins at M S & Ds are expected to improve sequentially due to production mix and deliveries, while a US and Spain margins are expected to be lower sequentially due to mix and lower expected net earnings adjustments .

第四季的銷售將受到 Albert Phase IB 銷售量增加的推動。 21 日，CES 上的國際彈藥交付和 MS 上的多個生產項目。基於我們成功執行成本節約計畫和強勁的計畫績效，我們將部門營業收入範圍的下限增加到四。由於生產組合和交付，M S & D 的利潤率預計將連續改善，而由於生產組合和預期淨利潤調整較低，美國和西班牙的利潤率預計將連續下降。

Altogether, our latest guidance continues to reflect a full year segment OM rate of 11%. At the midpoint, we are reaffirming our guidance range for free cash flow that projects greater than 15% growth at the midpoint. We remain confident in our ability to generate strong and predictable cash flows. Year to date, we've returned 3 billion of cash to shareholders via dividends and share repurchases and continue to expect $2.5 billion in repurchases for the full year.

總而言之，我們的最新指引持續反映全年分部 OM 率為 11%。在中點，我們重申自由現金流的指導範圍，預計中點成長率將超過 15%。我們對產生強勁且可預測現金流的能力仍然充滿信心。今年迄今為止，我們已透過股利和股票回購向股東返還了 30 億美元現金，並預計全年回購金額將達到 25 億美元。

Lastly, we are again increasing our earnings per share expectations now to a range of $25.65 to $26.5, up by $0.75. This updated range reflects our confidence and continued strong segment performance. Lower corporate unallocated cash calls, lower interest expense and a more favorable tax rate. I wanted to take a moment to talk about pension income. Our pension plans remain in great shape with a funded status over 100% and minimal cash contributions projected over the next several years. Our funded status, drives affordability for our customers and help support strong capital returns to our shareholders. As we've done the last few years, we provided a net pension income sensitivity table for the upcoming year. In our earnings deck through September 30th, asset returns have been in the low 7% range and discount rates were down modestly. So as we sit here today, there is no change through our 2025 net pension income expectations that we shared in January. As we look forward to 2025, we remain confident in our business strategy. As Kathy outlined and as shown on slide 10, we expect another year of solid growth, continued margin expansion at a lower level of capital expenditures. This combination, along with lower R & D cash taxes and higher forecast recoveries produces a recipe to rapidly grow our cash flows at the midpoint. We expect free cash flow growth of over 20% next year. And with our capital deployment strategy of investing in our business for profitable growth and returning cash to shareholders, free cash flow per share is growing even faster. Also, our 2025 outlook assumes that macro conditions will remain stable and the continuing resolution will have a similar duration to those of recent years. In closing, I believe our strategy will continue to create value for our customers and shareholders, and I'm confident about the opportunities we have ahead. I look forward to engaging further with the investment community over the coming quarters. I also wanted to take a moment to thank Dave for his leadership and contributions to our company and for support during this transition.

最後，我們現在再次將每股盈餘預期上調至 25.65 美元至 26.5 美元，上調 0.75 美元。這項更新的範圍反映了我們的信心和持續強勁的細分市場表現。較低的企業未分配現金調用、較低的利息支出和更優惠的稅率。我想花點時間談談退休金收入。我們的退休金計畫仍保持良好狀態，資金到位率超過 100%，預計未來幾年的現金繳款額將降至最低。我們的融資地位提高了客戶的負擔能力，並有助於為股東提供豐厚的資本回報。正如我們過去幾年所做的那樣，我們提供了來年的淨退休金收入敏感度表。在截至 9 月 30 日的收益表中，資產回報率一直處於 7% 的低水平，折現率小幅下降。因此，當我們今天坐在這裡時，我們 1 月分享的 2025 年退休金淨收入預期沒有變化。展望2025年，我們對我們的業務策略仍然充滿信心。正如 Kathy 概述和幻燈片 10 所示，我們預計又一年將實現穩健成長，並在較低的資本支出水準下持續實現利潤率擴張。這種結合，加上較低的研發現金稅和較高的預測回收率，為我們的現金流量中點快速成長提供了一個秘訣。我們預計明年自由現金流成長將超過 20%。透過我們投資業務以實現獲利成長並向股東返還現金的資本部署策略，每股自由現金流成長得更快。此外，我們的 2025 年展望假設宏觀條件將保持穩定，持續解決方案的持續時間將與近年來相似。最後，我相信我們的策略將繼續為我們的客戶和股東創造價值，並且我對我們未來的機會充滿信心。我期待在未來幾季與投資界進一步接觸。我也想花點時間感謝 Dave 的領導和對我們公司的貢獻以及在此過渡期間的支持。

With that, let's open the call for your questions.

接下來，讓我們開始詢問您的問題。

(Operator Instructions) Robert Stallard with Vertical Research. You may proceed.

（操作員說明）羅伯特·斯塔拉德（Robert Stallard）與垂直研究。您可以繼續。

Thanks so much. Good morning. Good morning and the best of luck. Dave review next ventures coupled with contract clinical program. Questions for you, Kathy. And first of all, on Sentinel, it looks like the timetable is moving around a bit, but I was wondering if there was any financial or practical implications as a result of this schedule change? And then secondly, on the program we won in the quarter GPI. I was wondering, I mean it might be classified visiting. You could give us a bit more detail on the contract structure for this program and the revenues are likely to progress.

非常感謝。早安.早上好，祝你好運。戴夫審查了下一個項目以及合約臨床計劃。有問題要問你，凱西。首先，在 Sentinel 上，時間表似乎有所變動，但我想知道這一時間表變更是否會產生任何財務或實際影響？其次，在該項目上，我們在季度 GPI 中獲勝。我想知道，我的意思是它可能是分類訪問。您可以向我們提供有關該計劃的合約結構的更多詳細信息，並且收入可能會增加。

Thank you. Great. Thank you, Rob. Let me start with Sentinel. As we noted in the call, are both this quarter and last, we hit incorporated into our outlook for the program. The changes that will result from that none McCurdy review and the restructure process that the Air Force's going and through that restructure process has started is not concluded. We expect that to continue well into next year and yet we have looked at what we believe is most likely to happen as we do on any of our programs and incorporated that into our estimates.

謝謝。偉大的。謝謝你，羅布。讓我從哨兵開始。正如我們在電話會議中指出的那樣，在本季度和上季度，我們都將該計劃納入了我們的展望中。麥柯迪的審查和空軍正在進行的重組過程以及已經開始的重組過程所帶來的變化尚未得出結論。我們預計這種情況將持續到明年，但我們已經研究了我們認為最有可能發生的情況，就像我們對任何計劃所做的那樣，並將其納入我們的估計中。

And so that is the smoothing of sales that you've heard us talk about in this call unless the ramp will look like as we move into 2025. And we do still expect the program to grow year over year from 24 and 25, just as it did 24 over 23. Similar profile just moved out a bit over a longer period time on GPI. There are very pleased to be supporting the Missile Defense Agency in this area to building interceptor that will defeat hypersonic missile threats. And you know, this is a very important area for national security to be able to defer. And again, the breadth as they evolve.

因此，這就是您在這次電話會議中聽到我們談論的銷售平滑，除非我們進入 2025 年時會出現這樣的情況。 24 比23。他們非常高興能夠支援飛彈防禦局在這一領域建造攔截器，以擊敗高超音速飛彈威脅。你知道，這是國家安全能夠延後的一個非常重要的領域。再一次，它們發展的廣度。

We are starting with a piece of work that will continue what we had been doing around risk reduction and design and move to a more mature design in this next phase, getting us eventually to a preliminary design review . And then after that, we will move to the net Phase two program. So it is an incremental funding approach, but this down-select was important because it signifies that missile defense agency like their design and once to continue in the development process with that. That's great.

我們正在開始一項工作，該工作將繼續我們圍繞降低風險和設計所做的工作，並在下一階段轉向更成熟的設計，最終使我們進行初步設計審查。之後，我們將轉向網路第二階段計劃。因此，這是一種增量資金方法，但這種向下選擇很重要，因為它表明導彈防禦機構喜歡他們的設計，並一度繼續其開發過程。那太棒了。

Our next question comes from Ronald Epstein with Bank of America. You may proceed.

我們的下一個問題來自美國銀行的羅納德·愛潑斯坦。您可以繼續。

Good morning, everyone. Cabby broadly, given the demand you're seeing across the businesses and the growth that you're going to have, what are you seeing in supply chain? Are there points right now? Or are there places that you're worried about them are going to move toward broadly from your Company's costs, et cetera, that are still we're still our supply chain issues? And how are you managing to and quarters and worried about and working there?

大家早安。從廣義上講，考慮到您在各個業務中看到的需求以及您將要實現的成長，您在供應鏈中看到了什麼？現在還有積分嗎？或者您是否擔心他們會從您公司的成本等方面轉向廣泛的領域，而我們仍然存在供應鏈問題？您如何管理宿舍並擔心在那裡工作？

Yes. From we still see supply chain challenges, mostly with capacity and productivity. And let me unpack that a bit. They are concentrated in any one area of the business, their broad based and they tend to now to be more supplier dependent. And so we are working with individual full suppliers to help them address their particular challenges. It spans from micro electronics to our solid rocket motor business supply chain as they tried to ramp to the increased capacity that we are all asking of them. It includes even some of our space and aero structure, sure, partners in space and a US respectively.

是的。我們仍然看到供應鏈面臨的挑戰，主要是產能和生產力的挑戰。讓我稍微解開一下。他們集中在業務的任何一個領域，基礎廣泛，現在往往更依賴供應商。因此，我們正在與各個完整供應商合作，幫助他們應對特定的挑戰。它涵蓋從微電子到我們的固體火箭發動機業務供應鏈，因為他們試圖提高我們都要求他們增加的產能。當然，它甚至包括我們的一些太空和航空結構，分別是太空和美國的合作夥伴。

And so each of our teams across the segments have their top list of suppliers that they're working with. We do extensive monitoring of our supply chain so that we can hopefully see these issues coming. And then as soon as we do engage with the supplier to provide support, I don't expect that we will see all of these issues mitigated this year. It's improving and in many places stabilizing. But we are carrying out risks scandal and certainly some plan into 2025 to continue to monitor and work with our suppliers.

因此，我們各個細分市場的每個團隊都有他們正在合作的供應商的頂級名單。我們對我們的供應鏈進行廣泛的監控，以便我們能夠看到這些問題的出現​​。一旦我們與供應商合作提供支持，我預計今年所有這些問題都不會得到緩解。它正在改善，並且在許多地方趨於穩定。但我們正在進行風險醜聞，當然有些人計劃在 2025 年繼續監控我們的供應商並與他們合作。

Does it make sense to vertically integrate anywhere in the supply chain to controls and have it?

在供應鏈的任何地方進行垂直整合以進行控制和擁有是否有意義？

We have not generally taken a strategy of vertically integrating unless we feel that there is no path forward to support the supplier in the remaining viable. We obviously from time to time move away from a supplier that is not performing to and other supplier that we first tried to remediate it and where we have very few or even some places. So for suppliers are first instinct is not to enforce that it is to support them. But there are times when ultimately we do find ourselves needing to bring capability in house to ensure we perform on behalf of our customer commitments.

我們通常不會採取垂直整合的策略，除非我們認為沒有可行的途徑來支持供應商。顯然，我們會不時離開那些表現不佳的供應商，以及我們首先嘗試糾正問題的其他供應商，而我們的供應商很少甚至只有一些地方。所以對供應商來說，第一個反應不是強制，而是支持他們。但有時我們最終確實發現自己需要在內部引入能力，以確保我們履行對客戶的承諾。

Sheila Kahyaoglu with Jefferies.

希拉‧卡哈奧格魯 (Sheila Kahyaoglu) 與傑弗里斯 (Jefferies)。

You may proceed. Good morning, Kathleen, everyone, and thank you so much. Maybe we could talk about on the multi year growth cadence. Just looking at the backlog pretty solid on a competitor, talked about supply chain and potentially being execute at able to execute to close the gaps, have seen the headwinds and space go away. And just thinking about Box Shuttle program, what type of growth should we be thinking about and targeting for north over a multi-year time horizon?

您可以繼續。早安，凱瑟琳，大家，非常感謝你們。也許我們可以討論多年的成長節奏。只要看看競爭對手的積壓情況，談論供應鏈以及可能執行的能力來縮小差距，就可以看到逆風和空間消失了。想想 Box Shuttle 計劃，我們應該在多年的時間範圍內考慮和瞄準哪種類型的成長？

Well, we've been growing at 5% compound annual growth since 2019 and each year. We come into the year it with some opportunities and risks that we work to mitigate. And I'm very proud of the team for having been able to keep and maintain that very solid growth rate for the last five years. If we look forward, we've guided at 3% to 4%, as you know, and that too has both risks and opportunities.

自 2019 年以來，我們每年都以 5% 的複合年增長率成長。今年我們面臨著一些我們努力減輕的機會和風險。我為團隊在過去五年中能夠保持非常穩定的成長率感到非常自豪。如果我們展望未來，如您所知，我們的指導值為 3% 到 4%，這也既有風險也有機會。

I think it's a very balanced approach. If we were to see some of these supply chain challenges is we could see upward pressure on that growth rate . If we are competitively successful on opportunities in our pipeline, we could see upward pressure on that growth rate. And if we are able to continue to capture international business at the rate we did in the sector or in the third quarter at two times our sales, that certainly will provide some upward pressure on that growth rate.

我認為這是一個非常平衡的方法。如果我們看到供應鏈面臨的一些挑戰，我們可能會看到成長率面臨上行壓力。如果我們在管道中的機會上取得競爭成功，我們可能會看到成長率的上行壓力。如果我們能夠繼續以該行業的速度或第三季銷售額兩倍的速度獲得國際業務，這肯定會給成長率帶來一些上行壓力。

So we are working hard to materialize those opportunities there and clearly risks as well. Really the downside is the flip side of each of those things that I just outlined . But we believe that 3% to 4% next year is the realistic starting point. As we enter the year with what we know today, we don't guide beyond that, as you know, but I have said that I believe this business can continue to grow in that mid single digit range. And so that is the plan that we've laid out for ourselves . And based on what we see today, we think that's achievable.

因此，我們正在努力實現這些機會，但顯然也存在風險。實際上，缺點是我剛才概述的每一件事的反面。但我們認為明年3%到4%是現實的起點。當我們以今天所知的情況進入新的一年時，正如您所知，我們不會超出這一範圍，但我說過，我相信這項業務可以繼續在中個位數範圍內增長。這就是我們為自己所訂的計劃。根據我們今天所看到的情況，我們認為這是可以實現的。

David Strauss with Barclays.

大衛·史特勞斯與巴克萊銀行。

Good morning. Kathy, you wanted to see if you could just broadly touch on the 21 and the progress there rose to two, the come to the charges. You've taken some kind of where you are in a sign up additional our IT, lots, pricing on those, those where you are with Nielsen kind of locking in your suppliers. Yes. Just kind of wherever you want to take in terms of an update on on B. 21 and then margin progression on it at a US banks, right.

早安.凱西，你想看看你是否可以大致觸及 21 號，那裡的進度上升到了 2 號，即指控。你已經在註冊我們的額外IT、批次、定價方面採取了某種方式，你在尼爾森那裡鎖定了你的供應商。是的。就像你想在 B.21 上更新一樣，然後在美國銀行進行保證金進展，對吧。

So let me start with B. 21, and then I will tie it to the broader a U.S. margin picture because that's important in that will be 21 is a key program in our company. It is not the majority of a sales. And so the rest of the picture is important in drilling out the view on margin performance for the business, which, as I said, was just outstanding again this quarter, I would be 21.

因此，讓我從 B.21 開始，然後我將其與更廣泛的美國利潤圖聯繫起來，因為這很重要，因為 21 將成為我們公司的關鍵計劃。這並不是銷售額的大部分。因此，圖片的其餘部分對於深入了解該業務的利潤率表現非常重要，正如我所說，本季度該業務再次表現出色，我將 21 歲。

We are on track for meeting the milestones associated with an award of our two. And so we are expecting that to happen in the fourth quarter. We had talked to you about our it being awarded approximately annually. And so this is that we would like to get that on contracts . We have no change to pricing. You know, those were priced and we have no change to our estimate at complete based on our third quarter review. So we are continuing to perform, as I said a few moments ago in alignment with the plan that we have laid out for the 21.

我們有望實現與我們兩人獲獎相關的里程碑。因此，我們預計這將在第四季度發生。我們曾與您討論過我們的獎項大約每年頒發一次。所以這就是我們希望在合約中得到的。我們的定價沒有改變。您知道，這些已定價，根據我們第三季的審查，我們對完成的估計沒有變化。因此，正如我剛才所說，我們將繼續按照我們為 21 世紀制定的計劃執行任務。

And I'm very proud of that team. It's quite a remarkable accomplishment. What they are doing both on development and production. As we look at the broader a US through activities, they've taken to manage cost and drive productivity, some really innovative work they're doing and workforce training to get it new employees onto the factory floor and more productive on day one and down the learning curve quicker.

我為這個團隊感到非常自豪。這是一項相當了不起的成就。他們在開發和生產方面正在做什麼。當我們透過活動觀察更廣泛的美國時，他們已經採取了管理成本和提高生產力的措施，他們正在做一些真正創新的工作，並進行勞動力培訓，以使新員工進入工廠，並在第一天和以後提高生產力學習曲線更快。

We have been able to really improve our performance on the more mature production programs as well as well, which has provided even further lift to a US and contributed to the very strong margin rates that lease are seeing on that mature production portfolio. We had talked a year ago about that being the vision, and I'm pleased to say that the team has executed it very well.

我們也能夠真正提高我們在更成熟的生產計劃上的表現，這為美國提供了進一步的提升，並有助於租賃在成熟的生產組合上看到非常高的利潤率。一年前我們就討論過這個願景，我很高興地說團隊已經很好地執行了它。

Jason Gursky with Citi. You may proceed.

花旗銀行的賈森古爾斯基。您可以繼續。

Good morning, everyone. Question, um, it for a quick one for you on some trends going on there in Europe and the pipeline and the bookings for occupancy merit. Given the demand, curious for the contract types that you'll be operating with their generally speaking of MS. versus direct commercial would grow, what does that portend for margins from across th e businesses going forward? Is that mix shifts maybe a little bit more too? Some international work?

大家早安。問題是，嗯，這是為了讓您快速了解歐洲的一些趨勢以及管道和入住價值的預訂。考慮到需求，對您將使用他們一般意義上的 MS 操作的合約類型感到好奇。相對於直接商業的成長，這對未來各業務的利潤率又意味著什麼？這種混合變化是否也可能更多？一些國際工作？

It's a combination of contract types that we see across our international sales portfolio for our ammunition and weapons product. We typically see those as direct commercial sales and for our more complex weapon systems, anything that would entail integration, for instance, IBC, Tritan, we would see those as SMS sale.

這是我們在彈藥和武器產品的國際銷售組合中看到的合約類型的組合。我們通常將這些視為直接商業銷售，而對於我們更複雜的武器系統，任何需要整合的東西，例如 IBC、Tritan，我們都會將它們視為 SMS 銷售。

In both cases, we tend to see those as accretive to overall global segment and company margin rate as a result of us being further down the learning curve when we price for those of because we're building off of mature product lines. And so we expect that trend to continue as we look at the pipeline into the next year because some of the weapon system sales are larger, we do see that as a bigger contributor to the growth. But these Fiestas also, so an important part of the international pipeline, and we see both growing into next year.

在這兩種情況下，我們傾向於認為這些產品會增加整個全球細分市場和公司的利潤率，因為我們在定價時進一步降低了學習曲線，因為我們正在建立成熟的產品線。因此，當我們審視明年的管道時，我們預計這種趨勢將繼續下去，因為一些武器系統的銷售量更大，我們確實認為這是對成長的更大貢獻。但這些嘉年華也是國際通路的重要組成部分，我們預計兩者都會在明年成長。

Okay, great. And then just a quick one. Just sticking with contract types domestically. Are you seeing from I don't have any interest in comments or observations which you can make about the current contracting environment in the room. So any shifts in beauty strategy on how they're going to ask you all to to get yourselves on contract going forward?

好的，太好了。然後是快速的。只需堅持國內合約類型即可。您是否看到我對您對會議室中目前承包環境所做的評論或觀察沒有任何興趣？那麼美容策略上有什麼變化嗎？

I haven't seen any significant shift, but more dialogue for sure in terms of what contract type is appropriate for the work that is being conducted. And as a result, we have seen on particular opportunities, a shift from one type to another based on industry engagement. So I think that's healthy. It's helping the government to really understand what motivates and three and what's necessary in terms of the business condition for us to be able to invest in the way that supports the government's ability to get products in a timely fashion because at the end of the day, cost is one element that schedule is another.

我沒有看到任何重大轉變，但肯定會就哪種合約類型適合正在進行的工作進行更多對話。因此，我們在特定的機會中看到了基於行業參與度從一種類型轉向另一種類型的轉變。所以我認為這是健康的。它幫助政府真正了解什麼是動機，第三以及商業條件方面什麼是必要的，以便我們能夠以支持政府及時獲得產品的方式進行投資，因為歸根結底，成本是一個要素，進度是另一個要素。

And we want to make sure that we can deliver not only one, but when and at the price that is agreed to. So getting the contract type right is an important ingredient to make that up work.

我們希望確保我們不僅可以交付一份，而且可以以商定的時間和價格交付。因此，正確選擇合約類型是實現這一目標的重要因素。

Thank you. Our next question comes from Scott Deuschle with Deutsche Bank.

謝謝。我們的下一個問題來自德意志銀行的 Scott Deuschle。

Hey, good morning. Good morning. Ken, was the F-35 program, a driver of positive. You see that aeronautics again this quarter? And then would there be additional opportunity, expand margins on center fuselage over the coming years as you move to newer lots that have some better pricing on them? Thanks.

嘿，早安。早安.肯，是F-35計劃的積極推動者。您本季再次看到航空業嗎？然後，當您轉向價格更優惠的新地段時，未來幾年是否會有額外的機會擴大中央機身的利潤？謝謝。

Thanks for the question, Scott. We're absolutely pleased with AES's performance in the quarter. At what drove the overall positive in terms of net earnings adjustments, it really was a portfolio approach. And so what was it? one program alone, it was a mature production progress from across that portfolio. And we expect that to be the case in is really showing the benefits of the deliberate actions that we're taking to drive costs out of the business to create efficiencies and it's paying off as we look forward, you know, our team is focused on leveraging the investments we made in our factories to drive efficiencies.

謝謝你的提問，斯科特。我們對 AES 本季的表現非常滿意。推動淨利潤調整整體積極的因素實際上是投資組合方法。那是什麼？僅憑一個節目，它就是整個組合中成熟的製作進度。我們希望這種情況真正顯示出我們為降低業務成本以創造效率而採取的深思熟慮的行動所帶來的好處，並且正如我們所期望的那樣，它正在得到回報，你知道，我們的團隊專注於利用我們對工廠的投資來提高效率。

And so I do anticipate opportunities across our mature production progress moving forward, leading to improved booking rates. However, knowing in 2025, we do have a mix shift, particularly related to the growth on the restricted programs, which will put pressure relative to the overall booking rates. You saw a US this year.

因此，我確實預期我們成熟的生產進度將帶來機遇，從而提高預訂率。然而，據了解，到 2025 年，我們確實會發生混合變化，特別是與受限項目的成長有關，這將對整體預訂率帶來壓力。今年你看到了美國。

Okay. And then can maybe just what segments do you view as having the greatest opportunity to expand margins next year? And then maybe you could walk through some of the drivers there have put under vote underpinned that. Thanks.

好的。那麼您認為明年哪些細分市場最有機會擴大利潤呢？然後也許你可以瀏覽一些已經投票支持這一點的驅動因素。謝謝。

So when we think about next year is we see opportunities to expand margin across three of the four segments per my previous comments on a US, I would say, you know, given the comments that Kathy made before the mix of international, the focus on weapon systems, I believe DS has is what are the major drivers of that margin expansion also to is with investors to realize that EMS's creates an immense amount of value for our company and our shareholders. There's they're booking close to 14%. We've seen some headwinds that, as we've communicated, are temporal in nature.

因此，當我們考慮明年時，根據我之前對美國的評論，我們看到了擴大四個細分市場中三個細分市場利潤率的機會，我想說，考慮到凱西在國際混合之前發表的評論，重點是武器系統，我相信 DS 是利潤成長的主要驅動力，也是投資者認識到 EMS 為我們公司和股東創造巨大價值的原因。他們的預訂率接近 14%。正如我們所傳達的，我們已經看到了一些不利因素，這些因素本質上是暫時的。

And so as we move forward, do expect invest to continue to see accretive margins have been long term as we shift back more towards FFP. That margin expansion will continue to get back to the historical norms that we've seen. Embedded space update this quarter is absolutely great reflection of space in the activities that they are taking to focus on performance, drive efficiencies into the business.

因此，隨著我們向前邁進，隨著我們更多地轉向 FFP，預計投資將繼續看到長期利潤成長。利潤率擴張將繼續回到我們所看到的歷史正常水平。本季的嵌入式空間更新絕對很好地反映了他們為專注於績效、提高業務效率而採取的活動空間。

And so we see opportunities there to expand margins as well. So it's going to be a portfolio approach across those three segments. And DSOs should be the primary driver.

因此，我們也看到了擴大利潤的機會。因此，這將是這三個細分市場的組合方法。 DSO 應該是主要驅動力。

Thank you. Our next question comes from Gautam Khanna with TD Cowen. You may proceed.

謝謝。我們的下一個問題來自 Gautam Khanna 和 TD Cowen。您可以繼續。

Yes, good morning and congrats, David and Ken. I'm curious on two things. one just big picture, we got to see a dramatic differences between either candidate or administration on your programs than defense broadly. Then I have a follow-up.

是的，早安，恭喜大衛和肯恩。我對兩件事很好奇。從大局來看，我們必須看到候選人或政府之間在你的計劃上與廣泛的國防上存在巨大差異。然後我有一個後續行動。

Thanks, Scott, and welcome it. I do not see a significant difference. What we have seen over time is that the defense budgets more reflects the threat environment than any particular administration change. And so we fully expect that again, this time with the national defense strategy has remained consistent over the past several years in the last couple of administration.

謝謝，斯科特，歡迎。我沒有看到顯著差異。隨著時間的推移，我們看到的是，國防預算比任何特定的政府變化都更反映了威脅環境。因此，我們再次完全期待，這次的國防戰略在過去幾年中與過去幾年的政府保持一致。

And we believe that because it is responsive to the emerging threats around the globe and focused on both deterring in defending. And in that regard, it is well aligned to the program portfolio that Northrop Grumman has with a significant portion of our work supporting the U.S. in the builds and modernization of the nuclear triad, but also a portfolio that very much supports the U.S. and our allies in being able to defend and conflict when called upon. So we expect those to continue to be the driving features of a national defense strategy and therefore, what the budgets will support and reflect.

我們相信這一點，因為它對全球新出現的威脅做出反應，並專注於威懾和防禦。在這方面，它與諾斯羅普·格魯曼公司的項目組合非常一致，我們的工作很大一部分是支持美國核三位一體的建設和現代化，而且也是一個非常支持美國及其盟友的項目組合在需要時能夠防禦和衝突。因此，我們預計這些將繼續成為國防戰略的驅動特徵，因此也是預算將支持和反映的內容。

Could you just a quick follow up on space beyond 2025? I mean, what do you think kind of a longer-term trajectory of that revenue will be?

您能否快速跟進 2025 年後的太空狀況？我的意思是，您認為該收入的長期軌跡會是什麼樣子？

What we've said about space beyond 2025 is that we do expect it to return to growth. And we also have said that it's growing mid single digits without the headwinds of the two programs that are winding down. So it gives you a good sense of what we think that run rate might look like coming out of 2025.

我們對於 2025 年以後的太空業所說的是，我們確實預期它會恢復成長。我們也說過，在沒有兩個即將結束的計畫所帶來的阻力的情況下，它的成長速度為中個位數。因此，它可以讓您很好地了解我們認為 2025 年運行率可能會是什麼樣子。

Thank you. Our next question comes from Doug Harned with Bernstein. You may proceed.

謝謝。我們的下一個問題來自伯恩斯坦的道格·哈內德。您可以繼續。

Good morning. Thank you. Cavium earner to follow up on the space question because it's been complicated with the movement assumed. No problem, ANZ, I am the classified program when you when you look forward from here, I guess first of all, is it possible to compare apples to apple phone? What's changed in this space backlog from over the over the past year if we take out those other programs? And then can you highlight kind of what some of the more important programs for or program areas will be getting the growth rate you're talking about?

早安.謝謝。 Cavium 收入者會跟進太空問題，因為假設的運動很複雜。沒問題，ANZ，我是你的分類程序，當你從這裡往前看時，我想首先，有可能將蘋果與蘋果手機進行比較嗎？如果我們取消那些其他計劃，過去一年的空間積壓會發生什麼變化？然後您能否強調哪些更重要的計劃或計劃領域將獲得您所說的成長率？

Sure. When you look at the move of the STS. portfolio from space to defend, it is largely the Sentinel program. And so the backlog shifts that we made there gives you a sense of what that profile is for Sentinel. And you also can take a look at what's remaining and see that there is a very healthy sized backlog to support the space business. And while it's made up of a number of programs, many of which are restricted, it is broad based in its nature, it is supporting ground satellite build. It is supporting that intelligence missions as well as the Department of Defense.

當然。當你看STS的舉動。從太空防禦組合，很大程度是哨兵計畫。因此，我們在那裡所做的積壓工作轉移讓您了解了 Sentinel 的概況。您也可以查看剩餘的訂單，發現有大量的積壓訂單可以支援航太業務。雖然它由許多項目組成，其中許多項目受到限制，但其本質上基礎廣泛，它支持地面衛星的建造。它正在支援情報任務以及國防部。

And a significant portion of it is NASA and related civilian missions. And so what we can say is the backlog is well diversified. It is large and is, in many cases, early-stage programs that still have a lot of runway in front of them in terms of either future awards or production volume associated with development program. And then just if I can follow up on on the Home Defense Systems, you give a picture of what your expectation is for the percentage you'll get from international over the next couple of years since the firm is clearly expanding. And Doug, I'd prefer to wait until we guide in 2025 because it is rapidly expand in.

其中很大一部分是美國宇航局和相關的民用任務。所以我們可以說積壓的訂單是多元化的。它很大，而且在許多情況下都是早期項目，無論是在未來的獎項還是與開發項目相關的產量方面，它們面前仍然有很多跑道。然後，如果我可以跟進家庭防禦系統，您可以描述您對未來幾年從國際業務中獲得的百分比的期望，因為該公司正在明顯擴張。 Doug，我寧願等到 2025 年我們提供指導，因為它正在迅速擴張。

As you know, at this time of year, we're still in our process of laying out the details associated with our long r ange plan. And I know you're not just asking for what does that look like in a one-year blip in 2025, but what does that trajectory look like over time? And I'll be able to give some more color on that in the January call, and we'd be happy to do so since it is an important part of our growth strategy, not just in defense systems, but we believe it's material to the Company overall. And two. The other segments, both aeronautics and Mission Systems have significant international growth opportunities as well.

如您所知，每年的這個時候，我們仍在製定與長期計劃相關的細節。我知道您不僅想問 2025 年的一年時間會是什麼樣子，還想問隨著時間的推移，這一軌跡會是什麼樣子？我將能夠在 1 月的電話會議中對此進行更多闡述，我們很樂意這樣做，因為這是我們成長策略的重要組成部分，不僅是在國防系統中，而且我們相信它對公司整體。還有兩個。其他領域，包括航空和任務系統，也有重要的國際成長機會。

Myles Walton with Wolfe Research. You may proceed. Ken Herbert with RBC Capital Markets. You may proceed.

沃爾夫研究中心的邁爾斯·沃爾頓。您可以繼續。加拿大皇家銀行資本市場部的肯‧赫伯特。您可以繼續。

Yes, hi, good morning . Kathy, I wanted to ask your question about the economy. You've got a number of legacy programs here as we as we go to a USA and looked across the industry, funding for autonomy and related technologies just seems to be incredibly strong. How would you characterize your portfolio and autonomy today? Where are you investing? And maybe what do you see it's a couple of the big opportunities for you over the next few years. Yes, we certainly have been a leader in autonomy and continue to be and across multiple domains and weapons system type.

是的，嗨，早安。凱西，我想問你有關經濟的問題。當我們前往美國並縱觀整個行業時，這裡有許多遺留項目，對自治和相關技術的資助似乎非常強大。您現在如何描述您的投資組合和自主權？你在哪裡投資？也許您認為這是未來幾年您面臨的幾個重大機會。是的，我們確實一直是自主領域的領導者，並將繼續在多個領域和武器系統類型中保持領先地位。

So when you think about our history has largely been associated with the aircraft and we clearly are a leader there. There is truly autonomous, not remotely piloted, but truly autonomous vehicle, having several in operations today and continue to invest in that areas for the future. On crude aircraft. When you think about satellites, the command and control of a satellite is an ultimate too autonomous vehicle and more and more the opportunity set and phase is around maneuverability and command and control that we're investing there. And then finally, when you think about weapon system, they are less expensive unaccrued vehicles in many cases, and that's not just in the weapon itself.

因此，當您想到我們的歷史很大程度上與飛機有關時，我們顯然是這方面的領導者。有真正的自動駕駛汽車，不是遙控駕駛，而是真正的自動駕駛汽車，目前已有幾輛正在運營，並將在未來繼續在該領域進行投資。在簡陋的飛機上。當你想到衛星時，衛星的指揮和控制是一種終極的自主車輛，越來越多的機會集和階段是圍繞著我們在那裡投資的機動性和指揮和控制。最後，當你考慮武器系統時，在許多情況下它們都是更便宜的未累積車輛，而這不僅僅是武器本身。

But it's we think about the role that they play in defense. So we are investing in autonomy company-wide and really drawing trends across those investments are not thinking so much about the platform that the technology it self, which in this case, it's more in the software and integration. And one of the differentiation of our Company is that we are not just hardware or software and integration, and we've demonstrated that through a number of leading edge program that allow us to get the best the fit of both worlds coming together and operations.

但我們要考慮的是他們在防守中扮演的角色。因此，我們正在全公司範圍內投資自主權，並且真正繪製這些投資的趨勢時，並沒有過多考慮平台，而是技術本身，在這種情況下，更多的是軟體和整合。我們公司的與眾不同之處之一是我們不僅僅是硬體或軟體和集成，我們已經通過許多領先的計劃證明了這一點，這些計劃使我們能夠獲得兩個世界的結合和運營的最佳契合。

That's helpful. And as he is the software continues to be a driver here. Do you think there's risk that on the customer side sort of adoption or risk appetite to potentially hold back some of the opportunities here? Or how do you think the customer is able to keep up with what you're able to do on the technology side?

這很有幫助。正如他一樣，軟體仍然是這裡的驅動程式。您認為客戶方面的採用或風險偏好是否有可能阻礙某些機會的風險？或者您認為客戶如何跟上您在技術方面的能力？

I think there's an appetite for the capability that is strong, getting through a certification and program, particularly when you think about airworthiness with an autonomous vehicle is not easy and we've done it not many companies out and we have, but it is a rigorous process for good reason and is one that should remain rigorous.

我認為人們對通過認證和計劃的能力有強烈的興趣，特別是當你想到自動駕駛汽車的適航性並不容易時，我們已經做到這一點的公司並不多，但我們已經做到了，但這是一個嚴格的流程有充分的理由，並且應該保持嚴格。

And that's really where you need be assured that your software is sufficiently protected and tested to be able to operate and under conditions where you may have denied communications and jamming and other impact to what would be rudimentary way of supporting autonomy or remote piloting. So I'm going into a little bit of detail to share. It is not an easy task. So the demand certainly is there. The ability to respond to that demand, I think will be the pacing item for some company.

這確實是您需要確保您的軟體得到充分保護和測試的地方，以便能夠在您可能拒絕通訊、幹擾和其他對支援自主或遠端駕駛的基本方式的影響的情況下運行。所以我要分享一些細節。這不是一件容易的事。所以需求肯定是存在的。我認為響應這種需求的能力將成為某些公司的節奏項目。

Myles Walton with Wolfe Research. You may proceed.

沃爾夫研究中心的邁爾斯·沃爾頓。您可以繼續。

Thanks. Good morning. Dave, it sounds like 2024 free cash flows can be comfortable with the high end of the range based on your comments. Is that right? And then maybe can from a 2025 outlook for free cash flow. The guidance or the increase is about $600 million, but that looks like it's just covered with pension CapEx and taxes. So they're working capital or maybe burn off of [21] that's offsetting earnings.

謝謝。早安.戴夫，根據您的評論，聽起來 2024 年的自由現金流可以滿足該範圍的高端。是這樣嗎？然後也許可以從 2025 年的自由現金流前景來看。指引或增加額約為 6 億美元，但這看起來只是由退休金資本支出和稅收所覆蓋。因此，他們正在消耗營運資金，或者可能會燒掉[21]，從而抵消收益。

I'll be happy to start miles on 2024 and then hand it to Ken for a discussion of periods beyond the we didn't mean to indicate a direction toward either end of the free cash flow range for this year.

我很樂意在 2024 年開始里程，然後將其交給 Ken 討論超出的時期，我們無意表明今年自由現金流範圍兩端的方向。

As we noted, we've had a strong third quarter and year to date performance for free cash flow. That gives you look at prior year trends, you'd see a similar trend line through prior years of the quarterly progression. So it's a Q4 is expected this year as it has been in the past to be a strong free cash flow quarter. But we're not, I mean to indicate a direction toward either end of the free cash flow range. We're pleased to continue to maintain that really strong range that reflects strong growth year over year in 2024. Over to you, Ken, for any follow-up discussions around.

正如我們所指出的，我們的第三季和今年迄今的自由現金流表現強勁。這讓您可以查看前一年的趨勢，您會在前幾年的季度進展中看到類似的趨勢線。因此，預計今年第四季將是一個強勁的自由現金流季度。但我們不是，我的意思是指出自由現金流範圍兩端的方向。我們很高興繼續保持這一強勁的區間，這反映出 2024 年同比的強勁增長。

From a working capital perspective, as we've communicated in the past, we expect that to be right, relatively flat. You'll see at elevated levels right now. And that's just timing. You know, as we get through Q4 with the sales profile, it will level to our historical norms. We expect that in 2025. And when we think about what is driving the at the cash flow expansion in 2025, I would put it into two primary drivers. The first this operating performance was we expand margins and we convert those margins and cash.

從營運資金的角度來看，正如我們過去所傳達的那樣，我們預計這種情況是正確的，相對持平。你現在會看到水平升高。這只是時機。您知道，隨著我們第四季的銷售概況，它將恢復到我們的歷史標準。我們預計在 2025 年實現這一目標。第一個經營績效是我們擴大利潤率，並將這些利潤率和現金轉換。

The other major driver is the reductions in investment from our historical peaks. There are some minor benefits from regarding our D. cash taxes as well as cash pension recoveries. But it's really going to be driven by operations and investment levels.

另一個主要驅動因素是投資較歷史高峰減少。 D. 現金稅和現金退休金回收有一些小好處。但這實際上是由營運和投資水準所驅動的。

Our next question comes from Seth Seifman with JP Morgan. You may proceed. Thanks very much and good morning and congratulations to Dave again.

我們的下一個問題來自摩根大通的 Seth Seifman。您可以繼續。非常感謝，早安，再次祝賀戴夫。

I wonder if you could talk a little bit about inOne within defense systems and the missiles and munitions, we saw some investment. Some additional investment has solid rocket motors. I think there's a sense that there's a lot of capacity coming into the solid rocket motor area. We saw kind of a surge in demand for missiles and the additions, but kind of how enduring is the demand level there. And so I wonder if you could talk a little bit about how you see that on given given the investments you're making.

我想知道您是否可以談論防禦系統以及導彈和彈藥領域的 inOne，我們看到了一些投資。一些額外的投資是固體火箭發動機。我認為固體火箭發動機領域有大量產能。我們看到對導彈和附加設施的需求激增，但那裡的需求水平有多持久。因此，我想知道您是否可以談談您如何看待鑑於您正在進行的投資。

Yes. We do see that not only the U.S. that multiple alliance are likely to need to restock pile munitions that they have donated to Ukraine. And as a result, we believe that this higher demand signal is in during for multiple years. We have invested to lay in capacity, as you know, and increase capacity more than doubled at this point and moving toward a tripling of capacity with some US government supported our funding. And as we do that, we are working through our supply chain to ensure or it's not just our capacity that is theirs as well to support the entire build process as others are coming into the marketplace.

是的。我們確實看到，不僅美國這個多個聯盟可能需要補充他們向烏克蘭捐贈的大量彈藥。因此，我們相信這種更高的需求訊號將持續多年。如你所知，我們已經投資建設產能，目前產能增加了一倍多，並且在一些美國政府支持我們的資金支持下，產能正朝著三倍的方向發展。當我們這樣做時，我們正在透過我們的供應鏈來確保，或者不僅僅是我們的能力，也是他們的能力，以及在其他人進入市場時支持整個構建過程。

I think there will come a time when we need to look at how much capacity is anomalous. We are certainly not at that place in our company at this point in time. The investments that we are making, we are committed to making and we believe there will be plenty of demand for that capacity that will continue to monitor it. And we do any area where we're facilitating to ensure that we don't get out ahead of the demand signal. Great. Thanks very much.

我認為總有一天我們需要看看有多少容量是異常的。目前我們公司當然還沒達到那個位置。我們正在進行的投資，我們致力於進行的投資，我們相信對這種能力的需求將會很大，並將繼續對其進行監控。我們會在任何我們正在推動的領域開展工作，以確保我們不會在需求訊號出現之前就退出。偉大的。非常感謝。

Our next question comes from Matt Akers with Wells Fargo. You may proceed.

我們的下一個問題來自富國銀行的馬特·埃克斯。您可以繼續。

Hey, good morning. And good luck with the network with you guys could talk about kind of CapEx friends longer term. I think, Kathy, you kind of mentioned in the opening remarks, 25 lower, but still for elevated versus historical levels. Is there room for that sort of move down either absolute terms further out or as a percentage of sales, sort of what was driving that investment right now?

嘿，早安。祝你們網路好運，可以談論長期的資本支出朋友。我想，Kathy，您在開場白中提到了 25，但與歷史水平相比仍然較高。是否有進一步下降的空間，無論是絕對值還是佔銷售額的百分比（目前推動投資的因素）？

Yes, I'll take that. We certainly want to ensure we're able to continue to invest in our growing business as well as return cash to shareholders than it is true for the last several years, we have been investing more heavily in the business because the opportunities were there a need for a good offer opportunities that would create long-term profitable growth for the Company.

是的，我會接受的。我們當然希望確保我們能夠繼續投資於我們不斷增長的業務，並向股東返還現金，而不是過去幾年，我們一直在加大對業務的投資，因為有需要的機會為公司創造長期盈利增長的良好報價機會。

As we look over the horizon, we still see opportunities to grow the business, but not as capital intensive as what we did experience and many of the growth opportunities that we have have ahead of this decade. We have now invested in to support the program and its move to production. S

當我們放眼望去時，我們仍然看到了業務成長的機會，但不像我們所經歷的那樣資本密集，也不像我們在本十年之前所擁有的許多成長機會。我們現已投資支持該計劃及其投入生產。 S

o we naturally are seeing less pressure for CapEx in the out years of our plan. And we are going to be responsive as to that by lowering our CapEx expenditure. I believe it will still be at a historical norm level, not below that, but just not as elevated as it has been in the past several years. And we've been specific about what that looks like in 2025. We've also said that it will come down further in 2026, but we haven't put more numbers.

o 在我們計畫的最後幾年裡，我們自然會看到資本支出的壓力較小。我們將透過降低資本支出來對此做出反應。我相信它仍將處於歷史正常水平，不會低於該水平，但不會像過去幾年那樣高。我們已經具體說明了 2025 年的情況。

And our last question comes from Scott Miks with Melius Research. You may proceed.

我們的最後一個問題來自 Melius Research 的 Scott Miks。您可以繼續。

Morning. Morning, Kathy. I wanted to ask the airport seems very pleased with Northridge execution, B-21 program or record calls for 100 production units. But Carrefour's has publicly stated that its desired inventory for 150 B. 20 ones with the Air Force reevaluating at least the main part and get to that free up future funding for the Air Force to get to that desired B. 21 inventory of 150 units?

早晨。早安，凱西。我想問機場似乎對 Northridge 的執行、B-21 計劃或 100 個生產單位的記錄調用感到非常滿意。但家樂福已公開表示，其希望擁有 150 架 B.20 的庫存，而空軍至少會重新評估其主要部分，並為空軍釋放未來的資金來獲得所需的 150 架 B.21 庫存？

Well, Scott, I think that's exactly what they are forces looking at. They are undertaking a force structure, design review and power. And the secretary has been open about looking at the various options they have for increasing there for size and has talked specifically about any gaps. And we know that a 21 is in the mix as well. It would be premature for me to suggest where that force structure review will end up.

嗯，斯科特，我認為這正是他們所關注的。他們正在進行部隊結構、設計審查和權力建設。國務卿一直持開放態度，考慮擴大規模的各種選擇，並特別談到了任何差距。我們知道 21 也在其中。我現在就提出部隊結構審查的最終結果還為時過早。

But I do think in the coming months, we make it a better indication from the Air Force as to how they're thinking about a 21 quantities in the long run. In the short run, we may remain very focused on delivering them optionality . The performance that we are delivering, give them a capability that is in production now that is well below the cost target for the platform. And we believe that that's the role of industry to give the government option because they think about their force structure.

但我確實認為，在接下來的幾個月裡，我們會讓空軍更了解他們如何考慮長期的 21 個數量。從短期來看，我們可能仍然非常專注於為他們提供選擇性。我們提供的性能使他們能夠在生產中獲得遠低於平台成本目標的能力。我們相信，工業界的角色就是為政府提供選擇權，因為他們會考慮自己的力量結構。

Thank you. Well, let me close by thanking the Northrop Grumman team for another outstanding quarter. They are executing our strategy. And importantly, that means that they're providing the capabilities our customers need in this incredibly dynamic environment that they face. I also just wanted to take a moment to Thanks, Cai von Rumohr or and George Shapiro, neither of whom are on the call today. But I think you all know they're retiring after respectively, 55 and 43 years covering this industry, which is just amazing.

謝謝。好吧，最後讓我感謝諾斯羅普格魯曼公司團隊又一個出色的季度表現。他們正在執行我們的戰略。重要的是，這意味著他們正在為客戶提供在他們面臨的這個令人難以置信的動態環境中所需的功能。我還想花一點時間感謝蔡馮魯莫爾或喬治夏皮羅，他們今天都沒有參加電話會議。但我想你們都知道，他們在這個行業工作了 55 年和 43 年後就要退休了，這真是太神奇了。

And we have truly enjoyed working with them both and we'll miss their expertise and commitment to this industry. So in addition, I do want to congratulate Dave on his retirement, not quite 55 years in the industry. The five years with our company have been truly outstanding and wish you all the best in your retirement. So thanks to all of you for joining our call. We look forward to talking to you again in January, if not before.

我們非常享受與他們的合作，我們會懷念他們的專業知識和對這個行業的承諾。另外，我確實想祝賀 Dave 退休，他在這個行業還不到 55 年。在我們公司工作的五年確實非常出色，祝您退休後一切順利。感謝大家加入我們的電話會議。我們期待在一月份（如果不是更早的話）再次與您交談。

Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation.

謝謝。女士們、先生們，今天的電話會議到此結束。感謝您的參與。