SAIC Announces Revenue and Earnings for the Third Quarter of Fiscal 2006
(SAN DIEGO) Dec 16, 2005 - Science Applications International Corporation (SAIC) today announced that it achieved third quarter revenues of $2.0 billion, representing a growth rate of 10 percent over revenues of $1.8 billion for the third quarter of the previous fiscal year. View our Fiscal Year 2006 Income Statement and Balance Sheet (33k, PDF file*).
SAIC's operating income for the third quarter was $108 million, compared to $130 million for the same period last year. Operating income decreased primarily due to an additional loss of $61 million recorded on the company's firm-fixed-price contract with the Greek Government, as compared to an additional loss of $15 million recorded on this contract in the same period last year.
“The poor financial performance and challenges of the Greek Olympics contract are of continuing concern, and we are doing all we can to bring this contract to a satisfactory conclusion for our customer and the company,” said Ken Dahlberg, SAIC chairman and chief executive officer. “The third quarter of fiscal 2006 was otherwise a very good quarter for us, and we continue to win and execute well on important contracts across all areas of our core business.”
Operating income for the third quarter before the effect of the additional loss recorded on the Greek contract was $169 million, as compared to $145 million in the same period last year. This increase in operating income reflects overall improved contract performance and higher labor utilization, partially offset by expenditures for investment in our information technology and other infrastructure required to support our growth.
Non-operating income items in the aggregate increased $27 million for the third quarter compared to the same period of the prior year, primarily due to an increase in interest income and equity investment income related to the company's joint ventures.
Income from continuing operations for the third quarter was $72 million, compared to $68 million for the same period of the prior year, primarily reflecting the decrease in operating income offset by the increase in non-operating income. Net income for the third quarter was $91 million as compared to $95 million in the prior year, and included income from discontinued Telcordia operations of $19 million as compared to $27 million in the prior year. Income from discontinued operations in the current quarter resulted from resolution of tax contingencies related to our former Telcordia subsidiary that was sold in March 2005.
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SAIC is the largest employee-owned research and engineering company in the United States, with annual revenues of $7.2 billion and more than 43,000 employees in over 150 cities worldwide. SAIC engineers and scientists solve complex technical problems in national security, homeland security, energy, the environment, space, telecommunications, health care, and logistics. SAIC: FROM SCIENCE TO SOLUTIONS™
Statements in this announcement other than historical data and information constitute forward-looking statements that involve risks and uncertainties. A number of factors could cause our actual results, performance, achievements or industry results to be very different from the results, performance or achievements expressed or implied by such forward-looking statements. Some of these factors include, but are not limited to, the risk factors set forth in the Company's Annual Report on Form 10-K for the period ended January 31, 2005, and such other filings that the Company makes with the SEC from time to time. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof.
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