SAIC Announces First Quarter of Fiscal Year 2019 Results
RESTON, Va.--(BUSINESS WIRE)--Jun 12, 2018--Science Applications International Corporation (NYSE: SAIC), a leading technology integrator providing full life-cycle services and solutions in the technical, engineering, intelligence, and enterprise information technology markets, today announced results for the first quarter ended May 4, 2018.
“Solid execution in the first quarter of fiscal year 2019 resulted in SAIC’s third consecutive quarter of revenue growth and strong cash flow generation,” said SAIC CEO Tony Moraco. “Continued momentum enabled by the execution of our strategy against an improving federal budget environment allows us to invest for the future in both innovative technologies and new business opportunities.”
First Quarter of Fiscal Year 2019: Summary Operating Results
Revenues for the quarter increased $72 million, or 6.5%, compared to the prior year quarter due to revenue on new contracts primarily supporting NASA and the Environmental Protection Agency (EPA) ($47 million) and increased orders in our supply chain portfolio ($64 million). These increases were partially offset by completion of contracts and other net decreases across our portfolio ($39 million).
Operating income as a percentage of revenues decreased to 5.6%, compared to 5.7% for the prior year quarter, driven by higher supply chain material content which generate lower operating margins.
Net income for the quarter remained consistent as compared to the same period in the prior year. Higher operating income was offset by a lower tax deduction from stock-based compensation in the current quarter.
EBITDA (1) as a percentage of revenues for the quarter decreased to 6.5%, compared to 6.6% for the prior year quarter, driven by higher supply chain material content which generate lower operating margins.
Diluted earnings per share was $1.13 for the quarter. The weighted-average diluted shares outstanding during the quarter was 43.4 million shares.
Cash Generation and Capital Deployment
Total cash flows provided by operating activities for the first quarter were $88 million, consistent with the same period in the prior year. A net increase in working capital investments in platform integration programs supporting the U.S. Navy and Marine Corps was offset by strong customer collections in the current quarter.
During the quarter SAIC deployed $54 million of capital, consisting of $32 million in plan share repurchases (412 thousand shares) under SAIC’s previously announced share repurchase program, $14 million in cash dividends and an $8 million term loan repayment.
Quarterly Dividend Declared
Subsequent to quarter-end, the Company’s Board of Directors declared a cash dividend of $0.31 per share of the Company’s common stock payable on July 27, 2018 to stockholders of record on July 13, 2018. SAIC intends to continue paying dividends on a quarterly basis, although the declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements and other factors.
New Business Awards
Net bookings for the quarter were approximately $1 billion, which reflects a book-to-bill ratio of 0.8. SAIC’s estimated backlog of signed business orders at the end of the quarter was approximately $10 billion of which $1.9 billion was funded.
SAIC was awarded the following contracts during the quarter:
Notable Protect Awards (maintaining our existing contract base):
The U.S. Army Human Resources Command: SAIC was awarded a $108 million task order by the Army Human Resources Command to continue to develop, operate, and maintain more than 191 virtual applications that support soldiers from enlistment to retirement. Awarded under the Information Technology Enterprise Solutions - 2 Services (ITES-2S) contract vehicle, the single award task order has a one-year base period of performance, a one-year option, and a total contract value of approximately $108 million, if the option is exercised.
The U.S. Army Aviation and Missile Life Cycle Management Command (AMCOM): SAIC was awarded a $98 million task order by AMCOM to provide information technology (IT) support services. The Information Technology Support Services III task order has a one-year base period of performance, a one-year option, and an additional two-month option. The task order was awarded under the Information Technology Enterprise Solutions-2 contract vehicle.
The U.S. Navy: SAIC was awarded a $73 million task order by the U.S. Navy’s Space and Naval Warfare Systems Command (SPAWAR) to provide architecture and systems engineering support services to the Office of the Chief Engineer (CHENG) (SPAWAR 5.0), the Fleet Readiness Directorate (FRD), and various C4ISR programs and offices. The single-award task order has a one-year base period of performance, and four one-year options. The task order was awarded under the SeaPort-e contracting vehicle.
Notable Expand Awards (selling new services & solutions to existing customers):
The U.S. Army and the General Services Administration (GSA): SAIC was awarded a $205 million task order by GSA, on behalf of the U.S. Army Aircraft Survivability Equipment (ASE) Project Management Office (PMO), to provide engineering, program management, and technical support services. Awarded under the GSA One Acquisition Solution for Integrated Services (OASIS) contract vehicle, the task order has a one-year base period of performance and four one-year options.
NASA: SAIC will now manage NASA’s cloud-based web services under a new $58 million task order to provide the agency with various web support services. The task order was awarded under the NASA Enterprise Applications Service Technologies (EAST) 2 Master Agreement and will span roughly seven years, if all options are exercised. Under the task order, SAIC will support NASA with its existing agency-wide, cloud-based hosting capabilities. These services include the creation, maintenance, and management of websites, web applications, and other ancillary services.
SAIC management will discuss operations and financial results in an earnings conference call beginning at 5 p.m. Eastern time on June 12, 2018. The conference call will be webcast simultaneously to the public through a link on the Investor Relations section of the SAIC website ( http://investors.saic.com ). We will be providing webcast access only – “dial-in” access is no longer available. Additionally, a supplemental presentation will be available to the public through links to the Investor Relations section of the SAIC website. After the call concludes, an on-demand audio replay of the webcast can be accessed on the Investor Relations website.
SAIC is a premier technology integrator providing full life cycle services and solutions in the technical, engineering, intelligence, and enterprise information technology markets. SAIC is Redefining Ingenuity through its deep customer and domain knowledge to enable the delivery of systems engineering and integration offerings for large, complex projects. SAIC’s more than 15,000 employees are driven by integrity and mission focus to serve customers in the U.S. federal government. Headquartered in Reston, Virginia, SAIC has annual revenues of approximately $4.5 billion. For more information, visit saic.com. For ongoing news, please visit our newsroom.
Certain statements in this release contain or are based on “forward-looking” information within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by words such as “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “guidance,” and similar words or phrases. Forward-looking statements in this release may include, among others, estimates of future revenues, operating income, earnings, earnings per share, charges, total contract value, backlog, outstanding shares and cash flows, as well as statements about future dividends, share repurchases and other capital deployment plans. Such statements are not guarantees of future performance and involve risk, uncertainties and assumptions, and actual results may differ materially from the guidance and other forward-looking statements made in this release as a result of various factors. Risks, uncertainties and assumptions that could cause or contribute to these material differences include those discussed in the “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Legal Proceedings” sections of our Annual Report on Form 10-K, as updated in any subsequent Quarterly Reports on Form 10-Q and other filings with the SEC, which may be viewed or obtained through the Investor Relations section of our website at or on the SEC’s website at . Due to such risks, uncertainties and assumptions you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. SAIC expressly disclaims any duty to update any forward-looking statement provided in this release to reflect subsequent events, actual results or changes in SAIC’s expectations. SAIC also disclaims any duty to comment upon or correct information that may be contained in reports published by investment analysts or others.
This article has been truncated. You can see the rest of this article by visiting http://www.businesswire.com/news/home/20180612006201/en.