Financial Data and Key Metrics Changes - The second quarter revenue was $764 million, up 12% year-over-year, with organic revenue growth of 4% excluding acquisitions [18][19] - Adjusted EBITDA increased to $146 million, a 16% year-over-year growth, driven by strong performance in government operations [19][21] - Adjusted earnings per share rose to $1.02, reflecting a 24% increase, supported by lower tax rates and foreign currency gains [19][20] - Free cash flow for the quarter was robust at $126 million, aided by effective working capital management [20] Business Line Data and Key Metrics Changes - Government operations revenue grew by 9%, with adjusted EBITDA up 23% to $133 million, yielding an adjusted EBITDA margin of 22.6% [21] - Commercial operations reported revenue growth of 24%, but organic revenue was down 3%, primarily due to a decline in commercial power [22][23] - The backlog increased to $6 billion, a 23% quarter-over-quarter and 70% year-over-year growth, with organic book-to-bill at 2.2 [5][6] Market Data and Key Metrics Changes - Demand across global security, clean energy, and medical end markets is accelerating, with significant growth opportunities identified [5] - The naval propulsion business is expected to maintain a revenue CAGR of 3% to 5% over the long term, supported by recent contracts [7] - The medical segment is projected to achieve over 20% growth this year, driven by strong demand for diagnostic and therapeutic isotopes [13] Company Strategy and Development Direction - The company is focused on enhancing capabilities in the nuclear market through both organic and inorganic investments, including the recent acquisition of Kinetrix [27] - The strategy includes expanding life of plant services capabilities and responding to increasing demand in various end markets [5][27] - The company aims to leverage its operational excellence to drive shareholder value and capitalize on emerging opportunities in advanced nuclear technologies [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational performance and backlog, indicating a strong start to the year both financially and strategically [27] - The company anticipates continued strong performance in government operations and is raising guidance for revenue, adjusted EBITDA, and earnings per share for the year [25][26] - Management noted that while the second half may normalize from a strong first half, operational conditions remain favorable [110] Other Important Information - The company is actively pursuing advanced nuclear fuel opportunities and has a unique position in producing TriSil fuel at scale [70][92] - The recent reconciliation bill is expected to provide additional funding for nuclear programs, enhancing the company's growth prospects [96] Q&A Session Summary Question: Clarification on favorable contract adjustment - Management confirmed that a $29 million favorable contract adjustment relates to special materials contracts, with part included in original guidance [30][31] Question: Opportunities for securing content on new build AP1000s - Management indicated an MOU with Westinghouse to potentially manufacture components for AP1000 reactors, with opportunities for high-pressure components [32] Question: Impact of Kevin McCoy's appointment as Chief Nuclear Officer - Management clarified that McCoy is seconded to the Department of Defense, and Joe Miller has been promoted to President of Government Operations [40][41] Question: Drivers of improved government operations margins - Management attributed margin improvements to favorable contract performance and operational efficiencies, expecting continued strong performance [42][43] Question: Contribution of Kinetrix acquisition to guidance increase - Management noted that while Kinetrix contributed to guidance, the majority of the increase was due to timing and performance in government operations [58] Question: Engagement level in nuclear projects - Management reported high activity across all end markets, with strong government appetite and compounding growth in the medical sector [90][91] Question: Impact of critical minerals shortages - Management stated that they are not experiencing significant pressure from critical minerals, managing commodity risk effectively [117][119]