Highlights: - First Quarter revenues up 21% to $208.7 million; -
First Quarter operating income up 31%, operating margin a record
9.0%; and - Record diluted EPS of $0.45 for first quarter exceeds
guidance. ARLINGTON, Va., Aug. 4 /PRNewswire-FirstCall/ -- Stanley,
Inc. (NYSE: SXE), a leading provider of systems integration and
professional services to the U.S. federal government, today
announced healthy revenue growth and strong profitability for its
first quarter of fiscal year 2010 ended June 26, 2009. The company
also lowered fiscal year 2010 revenue and earnings guidance based
on delayed award activity. (Logo:
http://www.newscom.com/cgi-bin/prnh/20040106/DCTU010LOGO )
First-quarter revenues were within company guidance, and diluted
EPS exceeded the high end of company guidance by $0.02. Stanley's
revenue growth for the first quarter resulted primarily from U.S.
Marine Corps and Joint Strike Fighter program office network
operations and cyber security efforts; support for the U.S. Central
Command's biometrics programs in Iraq and Afghanistan; provision of
information technology and professional services for various
Department of Defense customers; and support services to the U.S.
Army Intelligence and Security Command. First-Quarter Fiscal Year
2010 Results: Revenues for the first quarter ended June 26, 2009,
were $208.7 million, an increase of 21 percent over first-quarter
fiscal year 2009 revenues of $172.6 million. Organic revenue
growth(1) was 5 percent. EBITDA(2) was $21.6 million for the
quarter, an increase of 34 percent over EBITDA of $16.1 million in
the year-ago quarter, driven by organic revenue growth, the
acquisition of Oberon Associates, Inc. in July 2008 and improved
EBITDA margin. EBITDA margin for the first quarter was 10.3 percent
compared with 9.4 percent a year earlier, due primarily to a
greater proportion of more profitable time-and-materials and
fixed-price contracts, as opposed to cost-plus-fee contracts.
Operating income was $18.7 million, up 31 percent from $14.3
million in the same quarter of last fiscal year. Operating margin
was 9.0 percent versus 8.3 percent in the first quarter of fiscal
2009. The increases in operating income and margin resulted
primarily from the factors improving EBITDA, partially offset by
the amortization of purchased intangibles related to the
acquisition of Oberon. Net income for the quarter was $10.7 million
versus $8.3 million a year ago. Diluted earnings per share for the
quarter were $0.45 compared with diluted earnings per share of
$0.35 for the first quarter of fiscal year 2009. Contract backlog
at June 26, 2009, was $2.0 billion, essentially unchanged from both
fourth-quarter and first-quarter fiscal year 2009 contract backlog.
First-Quarter Fiscal Year 2010 and Recent Operational Highlights:
-- First-quarter bookings totaled $207 million, equating to a
book-to-bill ratio of 1.0:1. -- Among recent new business awards
and additional tasking: -- A $120 million, three-year,
time-and-materials contract to continue system and software
engineering support to the U.S. Army Communications-Electronics
Command; -- A $13 million, one-year, proof-of-concept contract to
collect voice samples in support of a U.S. Army biometric effort;
-- A $10 million, two-year, time-and-materials contract to provide
program management, acquisition management, systems engineering and
logistics management services in support of special logistics
projects for the Naval Sea Logistics Center; -- An $8 million,
five-year, firm-fixed-price contract to provide technical services
to support and maintain the U.S. Marine Corps Systems Command Total
Force Retention System; -- A $6 million modification to the Joint
Strike Fighter contract for cyber security and operational test and
evaluation network support; -- More than $2 million in new awards
by the Defense Information Systems Agency for operational support
to the U.S. Army Intelligence Center Language and Technology Office
and systems engineering for reprogrammable ultra high frequency
satellite communications combat radios; and -- More than $2 million
in modifications to the U.S. Marine Corps Common Logistics Command
and Control System and Storage and Retrieval Asset Tracking System
contracts for support in Afghanistan. Cash flow from operations for
the first quarter of fiscal year 2010 was $9.4 million. Days sales
outstanding for the first quarter was 84 days, up from 79 days for
the fourth quarter of fiscal year 2009. "Stanley continues to post
record operating margins and net income as we see more favorable
contract mix and realize greater operational efficiencies," said
Phil Nolan, Stanley's chairman, president and CEO. "Although we
have lowered our revenue and earnings expectations for fiscal year
2010, we believe our strong pipeline of new business opportunities
positions us well for continued top-line growth in the coming
quarters, especially as several large key procurements are
ultimately awarded." Management's Outlook: Based on the company's
current contract backlog and management's estimate as to future
tasking and contract awards, Stanley is issuing guidance for its
second quarter of fiscal 2010 and updating guidance for full fiscal
year 2010. The table below represents management's current
expectations about future financial performance, based on
information available at this time: Second Quarter Fiscal Fiscal
Year 2010 Year 2010 Ending Ending September 25, 2009 March 31, 2010
Revenues $206 - $213 million $825 - $875 million Diluted EPS $0.41
- $0.43 $1.68 - $1.74 Diluted projected share count 24.0 - 24.1
million 24.1 - 24.2 million As previously announced, Stanley will
conduct a conference call today at 5:00 p.m. EDT to discuss fiscal
first-quarter 2010 results. Analysts and institutional investors
may access the call by dialing (888) 680-0879 (U.S.) or (617)
213-4856 (international) and entering pass code 34466035. The
conference call will be broadcast simultaneously on the Investor
Relations page of the company's website,
http://www.stanleyassociates.com/. Investors are advised to log on
to the website at least 15 minutes prior to the call to register,
download and install any necessary audio software. An archive of
the webcast will be available for one week following the live
event. About Stanley, Inc. Stanley (NYSE:SXE) is a provider of
information technology services and solutions to U.S. defense,
intelligence and federal civilian government agencies. Stanley
offers its customers systems integration solutions and expertise to
support their mission-essential needs at any stage of program,
product development or business lifecycle through five service
areas: systems engineering, enterprise integration, operational
support, business process outsourcing, and advanced engineering and
technology. Headquartered in Arlington, Va., the company has
approximately 4,800 employees at over 100 locations in the U.S. and
worldwide. Stanley has been recognized by FORTUNE magazine as one
of the "100 Best Companies to Work For" from 2007 through 2009.
Please visit http://www.stanleyassociates.com/ for more
information. Any statements in this press release about our
expectations about future financial performance, plans and
prospects, including statements containing the words "estimates,"
"anticipates," "plans," "expects" and similar expressions,
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Actual results
may differ materially from those indicated by such forward-looking
statements as a result of various important factors discussed in
our Annual Report on Form 10-K for the fiscal year ended March 31,
2009, as filed with the Securities and Exchange Commission (SEC),
and additional filings we make with the SEC. In addition, the
forward-looking statements included in this press release represent
our views as of the date of this release. Except as required by
law, we assume no obligation to update publicly or revise any
forward-looking statements made herein or any other forward-looking
statements made by us, whether as a result of new information,
future events or otherwise. (1) Organic revenue growth, as
presented, measures revenue growth adjusted for the impact of
acquisitions. Stanley believes that this non-GAAP financial measure
provides useful information because it allows management and
investors to better assess the underlying growth rate of the
company's existing business. This non-GAAP financial measure should
not be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. Please see the
reconciliation table at the end of this release that reconciles
GAAP revenue to organic revenue. (2) EBITDA is a non-GAAP measure
that is defined as GAAP net income (loss) plus other expense
(income), interest expense, income taxes, and depreciation and
amortization. We believe EBITDA is useful to investors because it
is one of the measures used by our board of directors and
management to evaluate our business and we believe it is a commonly
used measure of financial performance in comparable companies and
is provided to help investors evaluate companies on a consistent
basis, as well as to enhance an understanding of our operating
results. EBITDA should not be construed as either an alternative to
net income as an indicator of our operating performance or as an
alternative to cash flows as a measure of liquidity. Please refer
to the table at the end of this release that reconciles GAAP net
income to EBITDA. Condensed Consolidated Statements of Income
(unaudited) (in thousands, except per share amounts) Three Months
Ended ------------------ June 26, June 27, 2009 2008 --------
-------- Revenues $208,747 $172,566 -------- -------- Operating
costs and expenses: Cost of revenues 173,089 145,760 Selling,
general and administrative 14,092 10,659 Depreciation and
amortization 2,830 1,841 ----- ----- Total operating costs and
expenses 190,011 158,260 ------- ------- Operating income 18,736
14,306 Other income (expense): Other income 3 2 Interest income 37
125 Interest expense (1,147) (536) ------ ---- Total other expenses
(1,107) (409) ------ ---- Income before taxes 17,629 13,897
Provision for income taxes (6,965) (5,580) ------ ------ Net income
$10,664 $8,317 ======= ====== Earnings per share: Basic $0.46 $0.37
===== ===== Diluted $0.45 $0.35 ===== ===== Weighted-average
shares: Basic 23,172 22,676 ====== ====== Diluted 23,844 23,649
====== ====== Condensed Consolidated Balance Sheets (unaudited) (in
thousands) June 26, March 31, 2009 2009 -------- -------- Assets
Current Assets: Cash $4,636 $1,811 Accounts receivable - net
196,132 187,680 Prepaid and other current assets 5,367 6,766 -----
----- Total current assets 206,135 196,257 Property and equipment -
net 19,802 19,552 Goodwill 262,705 262,705 Intangible assets - net
14,078 15,557 Deferred taxes 4,183 4,212 Other assets 4,257 3,269
----- ----- Total assets $511,160 $501,552 ======== ========
Liabilities and Stockholders' Equity Current liabilities: Accounts
payable $17,062 $21,528 Accrued expenses and other liabilities
82,084 79,841 Current portion of long-term debt 1,000 1,000 Income
taxes payable 5,444 2,034 ----- ----- Total current liabilities
105,590 104,403 Line of credit 129,000 135,030 Long-term debt - net
of current portion 34,500 34,500 Other long-term liabilities 10,252
10,396 ------ ------ Total liabilities 279,342 284,329 -------
------- Commitments and contingencies Stockholders' equity: Common
stock 239 238 Additional paid-in capital 100,842 96,957 Retained
earnings 132,098 121,434 Accumulated other comprehensive loss (820)
(886) Less: treasury stock (84) - Deferred compensation (457) (520)
---- ---- Total stockholders' equity 231,818 217,223 -------
------- Total liabilities and stockholders' equity $511,160
$501,552 ======== ======== Organic Revenue Growth Reconciliation
(unaudited) (in thousands) Three Months Ended
---------------------- June 26, June 27, Percent 2009 2008 Growth
-------- -------- -------- Total revenues, as reported $208,747
$172,566 21% Plus: Revenues from acquired companies for the
comparable prior year period - 26,052 -------- -------- --------
Organic revenues $208,747 $198,618 5% ======== ======== ========
EBITDA Reconciliation (unaudited) (in thousands) Three Months Ended
------------------ June 26, 2009 June 27, 2008 -------------
------------- Net income $10,664 $8,317 Provision for income taxes
6,965 5,580 Interest expense 1,147 536 Interest income (37) (125)
Other income (3) (2) Depreciation and amortization 2,830 1,841
----- ----- EBITDA $21,566 $16,147 ======= ======= Revenues
$208,747 $172,566 ======== ======== EBITDA Margin 10.3% 9.4%
http://www.newscom.com/cgi-bin/prnh/20040106/DCTU010LOGO
http://photoarchive.ap.org/ DATASOURCE: Stanley, Inc. CONTACT:
Brian J. Clark, Executive Vice President and Chief Financial
Officer, +1-703-310-3236, or Lawrence Delaney, Jr., Investor
Relations Counsel, +1-703-739-7410, both of Stanley Web Site:
http://www.stanleyassociates.com/
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