Earnings rose at BWXT Technologies, Lynchburg, Va., in the third quarter, which the naval reactor manufacturer attributed mostly to its commercial business, offset by staffing up its government business in preparation for future work and an increase in corporate expenses.
BWX Technologies Chief Executive Rex Gevenden said the company’s quarterly performance was “slightly ahead of our expectations. The quarter was highlighted by a robust 13% organic revenue growth with double-digit revenue growth in both segments.”
Net earnings for the third quarter ended Sept. 30 were $106.5 million, or $.66 a share, up from $100.1 million, which paid $.67 a share in the year-ago quarter, BWX said in a press release detailing its third-quarter earnings. Quarterly revenue was $590 million, up year-over-year from $523.7 million.
Quarterly segment operating income for BWXT’s government operations segment was $85.6 million, up from $77.7 million a year ago. Segment revenue was $477.9 million, up from $422.5 in the year-ago period.
“Our naval propulsion business prospects remain robust,” Gevenden said during a Nov. 1 earnings call with financial analysts.
The Navy’s 30-year shipbuilding plan includes a recapitalization of the nuclear-powered fleet, promising plenty of future work for BWX, Gevenden said. That includes consistent procurement of Virginia-class submarines, bolstered by the new three-party AUKUS deal between the U.S., U.K. and Australia. The company can also rely on a decade of serial production of Columbia-class ballistic missile submarines starting in 2026, Gevenden said.
AUKUS should bring an infusion of cash to the U.S. submarine industrial base, with a recent $3 billion investment announced by Australia and another $3 billion included in the Biden Administration’s fiscal 2024 supplemental appropriations bill now being considered in Congress.
“Australia’s recent announcement to invest $3 billion into the US naval manufacturing industrial base is a positive step in helping to increase U.S. submarine production not only to meet our country’s needs but also to support incremental demand from our key allies including Australia and the United Kingdom,” Gevenden said. “We also by the way anticipate having content, although we can’t provide any details here, but we do expect to have content on the SSN AUKUS boat that would go to both the U.K. and Australia. So there’s a tail on that for us.”
Aside from building nuclear naval reactors, BWXT until 2014 held contracts to manage both the National Nuclear Security Administration’s (NNSA) uranium production hub in Oak Ridge, Tenn., and the Pantex Plant in Panhandle Texas. Consolidated Nuclear Security now holds a joint contract for both sites, but NNSA is splitting them into separate management deals, for which BWXT is rumored to have thrown its hat in the ring.
