Dear Fellow Shareholders:

90 years of powerful performance speaks to the historic achievements and contributions of Curtiss-Wright throughout its storied past.

2019 marked an exciting milestone in our Company’s history as we celebrated the 90th anniversary of our original 1929 listing on the New York Stock Exchange. Our enduring focus on innovation and growth has driven sustained strong financial performance required to maintain leadership positions in our key defense and commercial markets.

From the early days of flight to the unmanned capabilities of today, Curtiss-Wright has maintained a steady investment in its people, operations and technologies to achieve prominent positions in our markets.

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As displayed throughout the timeline on the preceding pages, our dedication to innovation has propelled Curtiss-Wright’s involvement in many industry firsts, where we have delivered can-not-fail technologies supporting:

the first commercial jet
the first nuclear submarine and aircraft carrier
the first commercial nuclear power plant, and
the first lunar module

Today, our unrelenting drive is characterized by our steady pursuit of operational excellence to achieve and maintain top quartile performance within our peer group, as well as the necessary financial discipline to deliver profitable growth.

$371M Free Cash Flow

16.5% Operating Margin

2019 Financial Performance

2019 was an exceptional year for Curtiss-Wright as we executed against our strategic priorities and achieved top quartile performance across most key financial metrics. By leveraging strong sales growth in our defense markets and the benefits of our ongoing margin improvement initiatives, we achieved solid results led by strong free cash flow generation and continued operating margin expansion.

Net sales increased 3% to $2.5 billion, led by robust growth in the aerospace and naval defense markets, including the contribution from acquisitions, as well as higher sales in the commercial aerospace market. Those gains allowed us to overcome slower economic and market conditions in several of our industrial businesses.

We generated a 7% increase in adjusted operating income, and strong margin expansion of 70 basis points to achieve an adjusted operating margin of 16.5%. This performance reflects solid execution in all three segments and the benefits of our ongoing margin improvement initiatives, despite an $8 million incremental increase in research and development (R&D) investments in 2019.

We achieved record adjusted diluted earnings per share of $7.27, an increase of 14%, reflecting our overall strong operational performance, and the benefits of steady share buyback activity.

In addition, we generated $371 million in adjusted free cash flow, driving an adjusted free cash flow conversion of 121%, led by the strong cash earnings and our continued efforts to reduce working capital. New orders increased 6%, principally led by strong demand in naval defense.

Celebrating 90 Years as a publicly-traded company!

On August 23, 2019, Curtiss-Wright Corporation commemorated the 90th anniversary of its listing on the New York Stock Exchange (NYSE) by ringing the Closing Bell®. Curtiss-Wright is the 56th longest continuously listed company on the NYSE since it began trading on August 22, 1929.

Our successes in 2019 keep us on track to attain our long-term targets...

We maintain a strong and healthy balance sheet, with approximately $1.8 billion available at the end of 2019 to support acquisitions, providing the financial flexibility that will enable us to continue to pursue our long-term growth strategies.

Our successes in 2019 keep us on track to attain our long-term targets for the three-year period ending in 2021:

5 - 7% Total Sales CAGR (led by a renewed focus on delivering top-line growth)
17% Adjusted Operating Margin (inclusive of acquisitions and strategic investments)
10% Adjusted diluted EPS CAGR (goal to deliver $8.50 in diluted EPS), and
$1 Billion in cumulative Free Cash Flow (with 110% average free cash flow conversion).

Disciplined Capital Allocation

Curtiss-Wright’s robust free cash flow generation and strong balance sheet enables a balanced capital allocation strategy that includes strategic acquisitions, consistent returns to our shareholders, and operational investments to drive our future growth.

We completed two acquisitions in 2019 - Tactical Communications Group (TCG) for $50 million and 901D Holdings (901D) for $135 million - that are expected to support our long-term financial objectives.

TCG’s leading-edge, tactical data link software solutions are used by the military for the transmission and exchange of real-time, secure wireless communications. This acquisition yields significant opportunities for growth by enhancing our existing flight test instrumentation offering with complementary tactical data link processing software, analytics and visualization capabilities.

901D is a trusted and proven supplier of ruggedized naval shipboard enclosure solutions, integrated electronic systems, and subsystems, and is known for its best-in-class design and engineering technologies dedicated to protecting electronic systems from harsh shock, vibration and thermal environments. Their solutions are utilized in mission-critical applications to protect servers, weapons systems and other hardware aboard U.S. Navy aircraft carriers, submarines and surface ships.

We maintained an active share buyback program. Since 2013, we have spent approximately $765 million to repurchase shares and reduced our share count by approximately 9 million shares. We expect to repurchase at least $50 million in shares in 2020. We have also maintained a steady pace of dividend payouts, including a 13% increase in the quarterly dividend during 2019. Our continued ability to deliver solid earnings growth and free cash flow have enabled us to consistently provide a steady and solid return to our shareholders.

We are continuing to invest in organic growth, with another $10 million incremental increase in research and development investment planned for 2020. In addition, we will complete the relocation of our DRG business to our new, state-of-the-art facility near Charleston, South Carolina.

DRIVING PROFITABLE GROWTH

I look forward to Curtiss-Wright’s achievements in 2020 and remain excited for the future. We are focused on growing our business organically and through strategic acquisitions, while also investing in critical technologies to ensure industry leadership. We will deliver on the One Curtiss-Wright vision to improve our operational efficiency through a continuation of the margin improvement initiatives which began in 2013.

Finally, we remain committed to achieving our three-year financial targets as well as providing steady distributions to our shareholders to deliver long-term shareholder value.

In Recognition

As always, I would like to thank our approximately 9,100 global employees for their untiring efforts and hard work for making this past year a strong success, and for the tens of thousands of employees who have made this 90-year journey possible.

David C. Adams

Chairman and Chief Executive Officer

Curtiss-Wright 2019 Annual Report