Carl Osler's questions to Leonardo DRS Inc (DRS) leadership • Q1 2025
Question
An analyst on behalf of Carl Osler of Vertical Research Partners asked if there is a new, lower baseline margin for the ASC segment excluding the one-time charge, inquired about the cash flow cadence for the year, and sought details on opportunities within the potential $150 billion supplemental funding.
Answer
CFO Michael Dippold explained that margin expansion was always expected to be skewed towards the IMS segment and that the ASC segment will face headwinds from the charge and increased R&D spending. He projected a cash flow trend similar to prior years, with a strong Q4. CEO William Lynn added that DRS aligns with multiple aspects of the supplemental bill, including force protection, counter-UAS, and space sensing.