By Calvin Biesecker
SAIC [SAI] last Thursday reported higher income and sales in the first quarter driven by lower taxes, the favorable resolution of some tax uncertainties, and acquisitions.
Net income rose 8 percent to $125 million, 32 cents earnings per share (EPS), versus $116 million (28 cents EPS) a year ago, topping consensus estimates by a penny. EPS results improved in part due to a lower share count stemming from a stock repurchase program.
Operating results included a $3 million charge related to the expiration of a information technology outsourcing contract with Scottish Power. A lower tax rate and the clearing of the tax uncertainties more than offset the charge.
Sales increased a percent to $2.7 billion from just below $2.7 billion due to acquisitions as organic revenues actually declined 1 percent. SAIC said that organic sales fell due to few new contract starts as a result of recent lower bookings and lower demand for materials on a number of programs.
Bookings in the quarter totaled $3.2 billion for a book-to-bill ration of 1.2, driven by awards for cyber security work. Backlog stood at $16.1 billion, with $5.6 billion funded, increases of 3 and 7 percent, respectively.
The company left its guidance intact for the year, which includes organic growth between 3 and 6 percent, and growing EPS from continuing operations by 8 to 14 percent.