Karman Space and Defense Conference Call Summary Company Overview - **Company**: Karman Space and Defense - **Acquisition**: Seemann Composites and Materials Sciences (MSC) - **Transaction Value**: $210 million in cash and approximately $10 million in Karman stock - **Expected Closing**: First quarter of 2026 with full integration by the end of 2026 Key Industry Insights - **Market Focus**: Expansion into high-priority maritime defense market - **Strategic Importance**: Acquisition enhances Karman's advanced materials IP portfolio and exposure to the Department of Defense's (DoD) naval programs - **Growth Drivers**: Addressing U.S. Navy submarine fleet recapitalization and supporting surface vessels, hypersonics, and missile systems Financial Highlights - **2025 Revenue Guidance**: $470 million to $471 million, representing a 36% growth year-over-year - **2025 Adjusted EBITDA Guidance**: $144.5 million to $144.9 million, with a margin of 30.8% - **2026 Revenue Guidance**: $700 million to $715 million, indicating a 50% growth year-over-year - **2026 Adjusted EBITDA Guidance**: $205 million to $215 million, with a margin of 30% - **Organic Growth**: Expected to be approximately 25% in 2025 and 50% in 2026, split between organic and inorganic growth Acquisition Rationale - **Strategic Fit**: Seemann and MSC's capabilities complement Karman's existing offerings, enhancing its position as an all-domain solutions provider - **Integration Plans**: Immediate integration and cross-selling of new products and technologies post-acquisition - **Competitive Moat**: Seemann's established relationships and sole-source positions on U.S. Navy programs provide a significant competitive advantage Operational Insights - **Seemann's Expertise**: Focus on large-scale composite products, including submarine bow domes and next-generation materials - **Lifecycle Capabilities**: Both companies offer full lifecycle capabilities from design through manufacturing - **Revenue Diversification**: No single program accounts for more than 8% of total revenue, ensuring a diversified revenue base Market Opportunities - **Defense Budget Trends**: Strong demand signals from the DoD for missile and submarine capabilities, with expectations for long-term contracts - **International Opportunities**: Potential for foreign military sales, particularly related to AUKUS agreements with Australia and the U.K. Conclusion - **Long-term Value Creation**: The acquisition is expected to deliver significant value to shareholders, customers, and employees through expanded market reach and enhanced capabilities - **Future Growth**: Karman is well-positioned for continued growth in the defense sector, supported by a strong backlog and pipeline of opportunities Important Notes - **Forward-Looking Statements**: The call included forward-looking statements regarding future performance, which are subject to risks and uncertainties - **Financial Reporting**: Karman will report on its new maritime end market and integrate Seemann's revenue into its overall financial structure This summary encapsulates the key points discussed during the Karman Space and Defense conference call, highlighting the strategic acquisition of Seemann Composites and MSC, financial projections, and market opportunities.