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Cubic Corporation (CUB)
Q1 2019 Earnings Conference Call
February 06, 2019 5:00 PM ET
Kirsten Nielsen - Vice President, Investor Relations
Brad Feldmann - Chairman, President & Chief Executive Officer
Anshooman Aga - Executive Vice President & Chief Financial Officer
Conference Call Participants
Ken Herbert - Canaccord
Jim Ricchiuti - Needham & Company
Mark Strouse - JPMorgan
David Williams - Drexel Hamilton
Louie DiPalma - William Blair
Previous Statements by CUB
» Cubic Corporation (CUB) CEO Brad Feldmann on Q4 2018 Results - Earnings Call Transcript
» Cubic's (CUB) CEO Brad Feldmann on Q3 2018 Results - Earnings Call Transcript
» Cubic Corporation's (CUB) CEO Brad Feldmann on Q2 2018 Results - Earnings Call Transcript
I would now like to turn the conference over to Kirsten Nielsen, Vice President, Investor Relations. Thank you. Please begin.
Hello, everyone, and thank you joining Cubic's webcast. This morning we reported our first quarter results for fiscal 2019. I’m joined by Brad Feldmann, Chairman, President and Chief Executive Officer; and Anshooman Aga, Executive Vice President and Chief Financial Officer.
I’ll remind everyone that statements made on today’s call that are not historical facts are considered forward-looking statements and are made pursuant to the Safe Harbor provisions of Federal Securities Law. You can find risk factors that could cause the company’s actual results to differ materially from our expectations listed in our most recent SEC filings.
In addition, we have included non-GAAP financial measures in our discussion. Reconciliations to the most directly comparable GAAP financial measures can be found in today’s press release and in the appendix to today’s presentation.
With that, I'll turn the call over to Brad.
Thank you, Kirsten. Thank you, everyone, for joining us today. On today's call, I will start with a brief overview of our financial results, followed by a strategy update. Then I'll hand the call over to Anshooman who will cover the financials in more detail.
Starting with slide three. We had a good quarter with strong growth, coupled with our meaningful progress on our strategic goals. In the first quarter, we achieved sales of $305.3 million, a 23% increase compared to the first quarter last year. Adjusted EBITDA was $20 million, a 74% increase compared to the first quarter of last year.
Performance was fueled by strong organic growth and the acquisition of Trafficware. The adoption of the new revenue recognition standard also impacted our results positively. Major project execution is on track and we remain laser-focused on meeting our commitments. Additionally, our recent acquisitions advance our NextCity strategy to the next level, by establishing Cubic as the United States' market leader for intelligent intersection management.
Turning to slide four. I would like to provide some more detailed insights into the strategic logic behind the acquisitions of Trafficware and GRIDSMART. Our NextCity vision has been to develop technologies and analytics, with the goal of optimizing urban travel and reducing congestion by improving the flow of passengers, vehicles and traffic through cities. CTS is already the global leader in many components of this strategic objective.
We have been aggressively investing in our existing traffic and congestion management capabilities that led to the win of the first-of-its-kind Sydney's Integrated Congestion Management Program last quarter. The acquisitions of Trafficware and GRIDSMART firmly has established us as the leader of the U.S. urban intelligent intersection management market, with our fully integrated suite of intelligent intersection technology.
Ours is the most advanced solution for intersection traffic detection and response, designed to optimize the flow of travelers and traffic through intersections. By combining the newly acquired intersection management technologies into our regional congestion management systems, Cubic will have the capability to optimize intersections on arterial roads, urban quarters and grids. Our technologies capture a broader view of traffic patterns across an entire region, enabling local authorities to predict volumes of inbound traffic from highways and freeways and into the urban domain.
Equally important, we now have the largest most technologically advanced connected vehicle network in the arterial traffic management market. We manage approximately 3,000 connected intersections across 10 locations in the U.S. and our user base is growing.
Our connected and autonomous vehicle product is the most advanced data-streaming technology currently available and is capable of streaming signal data from the intersection to the vehicle in about a second. This real-time performance enables several opportunities to operationalize the data across a variety of communication pathways to support connected and autonomous vehicle applications such as, reading, logistics, emergency services and rideshare to improve mobility, optimize efficiency and enhance safety. We welcome both Trafficware and GRIDSMART to the Cubic family.
Next on slide 5. I'd like to share with you the progress on our contract with The New York Metropolitan transportation authority. During fiscal year 2018, we were on schedule through all our design review milestones, and in Q1, we completed the factory acceptance testing.
We are currently in integration testing, which will be followed by field testing and piloting ahead of the public launch at select subway stations and on select buses in 2019, followed by progressive installation that will result in a complete rollout of contactless open payments for the MTA in October 2020.
In Boston, we've worked with the Massachusetts Bay Transportation Authority to complete the conceptual design review. We plan to complete the preliminary design review in April. Vehicle installation is scheduled to begin in mid-2019 with an initial pilot phase-in to begin at the end of 2019. We are scheduled to begin the transition to the new MBTA system in 2020.