Reading time ( words)
Science Applications International Corporation, 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 third quarter ended November 3, 2017.
“SAIC’s third quarter performance delivers on the expectations of revenue growth and improved profitability,” said SAIC CEO Tony Moraco. "In addition to the continued strong business development results, I am encouraged by the ongoing actions to align operations to our long-term strategy to drive the future success of the company."
Revenues for the quarter increased $31 million, or 3%, compared to the prior year quarter primarily due to higher revenue on new contracts supporting NASA, the U.S. Army and the Environmental Protection Agency (EPA) ($56 million), partially offset by the completion of contracts and other net decreases across our portfolio. These decreases include the loss of an IT integration contract supporting the Department of Homeland Security (DHS) ($14 million). The Company’s internal revenue growth(1) for the third quarter was 3.0%.
Operating income as a percentage of revenues decreased to 6.3% of revenues, compared to 6.6% for the prior year quarter, primarily due to lower profit from a higher volume of cost reimbursable contracts and higher material cost mix.
Net income for the quarter increased $1 million from the comparable prior year period primarily due to lower interest expense as a result of refinancing our long-term debt in the prior year ($3 million, net of tax) partially offset by an increase in the effective tax rate.
Adjusted EBITDA as a percentage of revenues for the quarter was 7.4%, compared to 7.7% for the prior year quarter due primarily to lower profit from a higher volume of cost reimbursable contracts and higher material cost mix.
Diluted earnings per share was $0.98 for the quarter. Diluted earnings per share was positively impacted by $0.05 during the quarter due to the adoption of ASU 2016-09 at the beginning of the fiscal year. The weighted-average diluted shares outstanding during the quarter was 44.2 million shares.
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.