SAIC Announces Financial Results for First Quarter Fiscal Year 2007
Revenue: Up 6 percent to $2.0 billion
(SAN DIEGO and MCLEAN, VA) Jun 12, 2006- Science Applications International Corporation (SAIC), a leading provider of research, engineering, and technology services and solutions, today announced financial results for the first quarter of fiscal year 2007, which ended April 30, 2006. View our Fiscal Year 2007 Income Statement and Balance Sheet (33k, PDF file*).
Revenue for the quarter increased 6 percent from $1.8 billion in the first quarter of fiscal year 2006 to $2.0 billion. Operating income for the quarter increased 28 percent from $112 million in the first quarter of fiscal year 2006 to $143 million. Operating income margin increased from 6.1 percent in the first quarter of fiscal year 2006 to 7.3 percent.
"We are pleased to begin the year with another strong quarter," said Ken Dahlberg, SAIC chairman and chief executive officer. "In a very competitive business environment, we continue to improve our operating efficiency, while still investing in our people and systems for long term growth. We are especially gratified to win several large recompetes in the first quarter. Our customers' faith in us is a testament to the hard work and innovation that our talented team is providing every day."
Chief Financial Officer Mark Sopp added, "We are very pleased with the April quarter results. Year-over-year earnings from continuing operations were up sharply, and we generated strong cash flow. We also embarked on several internal initiatives to more efficiently capture, process, and report financial transactions in the years ahead."
Net income for the quarter was $106 million, compared to $585 million in the first quarter of fiscal year 2006. Diluted earnings per share for the quarter were $0.61, compared to $3.18 in the first quarter of fiscal year 2006. The sale of Telcordia in March 2005 contributed $530 million towards net income and $2.88 towards diluted earnings per share for the first quarter of fiscal year 2006. The effect of the sale of Telcordia was recorded in discontinued operations. Income and diluted earnings per share from continuing operations rose 71 percent and 80 percent, respectively, compared to the first quarter of fiscal year 2006. Growth in income from continuing operations exceeded operating income growth primarily because the provisional tax rate dropped from 47.6 percent to 36.8 percent due to reversals of tax accruals in the current year period and changes in state tax laws in the prior year period.
The company adopted Statement of Financial Accounting Standard (SFAS) No. 123® during the quarter and recognized $8 million in compensation expense for option awards and the company discount associated with stock purchases under the Employee Stock Purchase Program. As a result of the company not being a public company for purposes of SFAS No. 123® until the filing of a registration statement on Form S-1 with the U.S. Securities and Exchange Commission on September 1, 2005, the company will not recognize expense for option awards granted before September 1, 2005 unless they are subsequently modified. For option awards granted after September 1, 2005, the company will recognize compensation expense ratably over the vesting cycle for each award.
SAIC is the largest employee-owned research and engineering company in the United States, with 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, 2006, 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.
| Business Contacts: | ||
| Use our Contact Form or call 1-800-430-7629. |
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| Investor Relations: | ||
| Stuart Davis 703-676-2283 stuart.davis@saic.com |
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| Press/Public Relations Contacts: | ||
| Connie Custer - McLean, VA 703-676-6533 custerc@saic.com |
Ron Zollars - San Diego, CA 858-826-7896 zollarsr@saic.com |