- Revenue increase of 35% to $383.4 million in the third quarter, 18% organic revenue growth
- Diluted EPS from continuing operations of $0.51 in the third quarter, up 24% from 2006 third quarter results
- Operating cash flow of over $41 million in the third quarter driven by strong profits and efficient receivables collection which resulted in days sales outstanding of 67 days
- Less than $86 million in total debt as of September 30, 2007, down from $170 million borrowed in May 2007 to fund the SRS acquisition
- Contract awards of $407 million in the third quarter, over 80% coming from new awards and expansion of existing contracts
FAIRFAX, Va., Oct 31, 2007 (BUSINESS WIRE) -- ManTech International Corporation (Nasdaq:MANT) today announced
results for the third quarter of 2007. ManTech reported revenue of
$383.4 million for the third quarter of 2007, up $99.7 million, or
35.1%, compared to $283.7 million for the same period in 2006. This
represents pro forma organic revenue growth of 17.9% for the third
quarter. The growth was primarily a result of the strong demand for
ManTech's services as a result of the Company's positioning at the
center of the national security marketplace and the acquisition of SRS
Technologies completed in May 2007.
Revenue from the Department of Defense, the Intelligence Community
and Homeland Security related customers accounted for 92.9% of revenue
for the third quarter of 2007. ManTech's time and materials contracts
accounted for 61.0% of revenue, fixed-price contracts accounted for
14.6% of revenue and cost-plus contracts accounted for 24.4% of
revenue.
Operating income in the third quarter was $30.4 million, up $7.4
million, or 32.2%, compared to $23.0 million for the same period in
2006. Net income from continuing operations in the third quarter was
$17.5 million, up 26.8%, compared to $13.8 million in the same period
in 2006. Diluted earnings per share from continuing operations was
$0.51 for the third quarter, up 24.4%, compared to $0.41 for the same
period last year.
"We had another outstanding quarter where our initiatives to
improve profitability and deliver strong cash flow were again
accomplished," said George J. Pedersen, Chairman of the Board and CEO
of ManTech International Corporation. "We drove exceptional revenue
growth and improved operating profit significantly from the second
quarter of this year, which in turn generated strong growth in our
earnings."
Contract Awards & Backlog
ManTech had $407 million in contract awards for the quarter with
over 80% coming from new awards and expansions of existing contracts.
As a result of the contract awards during the third quarter of 2007,
ManTech's reported backlog as of September 30, 2007, was $3.51
billion, a 29.5% increase from $2.71 billion as of September 30, 2006.
Funded backlog was $846 million, a 68.0% increase from $504 million as
of September 30, 2006.
This included a $90 million extension and expansion of ManTech's
Countermine contract. The current contract has been extended through
February 2008 and includes new work supporting Mine-Resistant Ambush
Protected (MRAP) vehicles.
"We continue to deliver solid contract awards with the vast
majority in the form of new business awards," said Robert A. Coleman,
President and Chief Operating Officer, ManTech International
Corporation. "As we continue to add new work to our contract base, we
remain confident in our ability to continue delivering strong organic
growth through 2008 and beyond."
Strong Cash Flow and Balance Sheet
Days Sales Outstanding of accounts receivable, or DSOs, were only
67 days as of September 30, 2007. This exceptional cash collection
quarter produced significant cash flow from operations during the
quarter of over $41 million and reduced debt to $85.7 million as of
September 30, 2007, down from the $170 million borrowed on May 7, 2007
to fund the acquisition of SRS.
Company Guidance
The Company's initial fourth quarter and updated full year 2007
guidance is summarized in the table below. ManTech's guidance does not
include future acquisitions or divestitures.
(Dollars in millions, except earnings per share amounts)
4th Quarter 2007 Full Year 2007
----------------------------------------------------------------------
Revenue $389 - $404 $1,415 - $1,430
----------------------------------------------------------------------
Diluted Earnings Per Share from
Continuing Operations $0.53 - $0.56 $1.87 - $1.90
----------------------------------------------------------------------
Weighted Average Shares Outstanding 34.9 million 34.6 million
----------------------------------------------------------------------
The Company's revenue guidance for the fourth quarter and full
year 2007 reflects the continuation of strong business momentum in its
core national security and defense business. The guidance range for
the fourth quarter 2007 implies total revenue growth of 34% to 39%
with organic revenue growth of 18% to 22%. The guidance range for the
full year 2007 implies total revenue growth of 24% to 26% with organic
revenue growth of 14% to 15%. The organic growth rate is derived by
adding both SRS and GRS Solutions' revenue for 2006 to ManTech's
previous quarter and annual revenue.
Conference Call
ManTech executive management will hold a conference call today at
4:30 p.m. ET, to discuss third quarter 2007 results and answer
questions. Interested parties may access the call by dialing (800)
811-8830 (domestic) or (913) 981-4904 (international). The conference
call will be Webcast (listen only) simultaneously via the Internet at
www.mantech.com. Interested parties should dial in or log on
approximately ten minutes prior to the start of the call.
A replay of the call will be available beginning at 8:30 p.m.
today and will remain available through midnight, November 14, 2007.
To access the replay, call (888) 203-1112 (domestic) or (719) 457-0820
(international). The confirmation code for the replay is 1463992. A
replay will also be available on ManTech's Website approximately two
hours after the conclusion of the call.
About ManTech International Corporation:
Headquartered in Fairfax, Virginia with approximately 7,000
professionals, ManTech International Corporation is a leading provider
of innovative technologies and solutions for mission-critical national
security programs for the Intelligence Community; the departments of
Defense, State, Homeland Security and Justice; the Space Community and
other U.S. federal government customers. ManTech's expertise includes
systems engineering, systems integration, technology and software
development, enterprise security architecture, information assurance,
intelligence operations support, network and critical infrastructure
protection, information technology, communications integration and
engineering support. The Company supports the advanced
telecommunications systems that are used in Operation Iraqi Freedom
and in other parts of the world; has developed a secure, collaborative
communications system for the U.S. Department of Homeland Security;
and builds and maintains secure databases that track terrorists. The
Company operates in the United States and 42 countries. In 2007,
ManTech was named one of Business 2.0 magazine's 100 Fastest Growing
Technology Companies for the second year in a row; to the Deloitte &
Touche list of the 50 fastest growing technology companies in
Virginia; and a GI Jobs magazine Top Ten Military Friendly Employer.
Additional information on ManTech can be found at www.mantech.com.
Forward-Looking Information:
Statements and assumptions made in this press release, which do
not address historical facts, constitute "forward-looking" statements
that ManTech believes to be within the definition in the Private
Securities Litigation Reform Act of 1995 and involve risks and
uncertainties, many of which are outside of our control. Words such as
"may," "will," "intends," "should," "expects," "plans," "projects,"
"anticipates," "believes," "estimates," "predicts," "potential,"
"continue," or "opportunity," or the negative of these terms or words
of similar import are intended to identify forward-looking statements.
These forward-looking statements are subject to known and unknown
risks and uncertainties, which could cause actual results to differ
materially from those anticipated, including, without limitation:
adverse changes in U.S. government spending priorities; failure to
retain existing U.S. government contracts, win new contracts, or win
recompetes; adverse results of U.S. government audits of our
government contracts; risks associated with complex U.S. government
procurement laws and regulations; adverse effect of contract
consolidation; risk of contract performance or termination; failure to
obtain option awards, task orders or funding under contracts; adverse
changes in our mix of contract types; failure to successfully
integrate recently acquired companies or businesses into our
operations or to realize any accretive or synergistic effects from
such acquisitions; failure to identify, execute or effectively
integrate future acquisitions; and competition. These and other risk
factors are more fully discussed in the section entitled "Risks
Factors" in ManTech's Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March 9, 2007, and, from time to
time, in ManTech's other filings with the Securities and Exchange
Commission, including among others, its reports on Form 10-Q.
The forward-looking statements included in this news release are
only made as of the date of this news release and ManTech undertakes
no obligation to publicly update any of the forward-looking statements
made herein, whether as a result of new information, subsequent events
or circumstances, changes in expectations or otherwise.
MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands Except Per Share Amounts)
(unaudited)
---------------------------
September 30, December 31,
2007 2006
------------- -------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 3,538 $ 41,510
Receivables--net 286,693 236,445
Prepaid expenses and other 15,347 13,581
Assets of operations held for sale - 3,373
------------- -------------
Total Current Assets 305,578 294,909
Property and equipment--net 14,188 13,881
Goodwill 389,062 238,322
Other intangibles--net 74,779 40,180
Employee supplemental savings plan assets 17,521 15,427
Other assets 11,249 10,533
------------- -------------
TOTAL ASSETS $ 812,377 $ 613,252
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of debt $ 75,700 $ -
Accounts payable and accrued expenses 95,183 72,125
Accrued salaries and related expenses 53,957 47,356
Deferred income taxes-current - 140
Billings in excess of revenue earned 7,259 5,284
Liabilities of operations held for
sale - 1,815
------------- ------------
Total Current Liabilities 232,099 126,720
Debt- net of current portion 10,000 -
Accrued retirement 18,363 16,750
Other long-term liabilities 7,190 3,302
Deferred income taxes--non-current 24,259 7,464
------------- -------------
TOTAL LIABILITIES 291,911 154,236
------------- -------------
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' EQUITY:
Common stock, Class A--$0.01 par
value; 150,000,000 shares authorized;
20,136,275 and 19,020,181 shares
issued at September 30, 2007 and
December 31, 2006; 19,893,235 and
19,020,181 shares outstanding at
September 30, 2007 and December 31,
2006 201 190
Common stock, Class B--$0.01 par
value; 50,000,000 shares authorized;
14,381,053 and 15,032,293 shares
issued and outstanding at September
30, 2007 and December 31, 2006 144 150
Additional paid-in capital 288,721 263,409
Treasury stock, at cost (9,114) -
Retained earnings 241,306 195,604
Accumulated other comprehensive loss (115) (120)
Unearned ESOP shares (677) (217)
Deferred compensation - 640
Shares held in grantor trust - (640)
------------- -------------
TOTAL STOCKHOLDERS' EQUITY 520,466 459,016
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 812,377 $ 613,252
============= =============
MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
(unaudited) (unaudited)
Three months ended Nine months ended
September 30, September 30,
------------------- ---------------------
2007 2006 2007 2006
--------- --------- ----------- ---------
REVENUES $383,359 $283,695 $1,026,344 $846,466
Cost of services 321,133 235,539 860,289 702,225
General and administrative
expenses 31,804 25,142 88,791 76,058
--------- --------- ----------- ---------
OPERATING INCOME 30,422 23,014 77,264 68,183
Interest expense 1,887 430 3,423 2,123
Interest income (153) (139) (1,106) (439)
Other expense (income),
net 84 (21) (262) (8)
--------- --------- ----------- ---------
INCOME FROM CONTINUING
OPERATIONS BEFORE
INCOME TAXES 28,604 22,744 75,209 66,507
Provision for income taxes (11,129) (8,962) (29,262) (26,204)
--------- --------- ----------- ---------
INCOME FROM CONTINUING
OPERATIONS 17,475 13,782 45,947 40,303
(Loss) from operations of
discontinued component,
net of taxes - (1,092) (458) (3,521)
Gain on sale of
discontinued operation,
net of taxes (sold to
CEO) - - 338 -
--------- --------- ----------- ---------
(Loss) from discontinued
operations, net of taxes - (1,092) (120) (3,521)
--------- --------- ----------- ---------
NET INCOME $ 17,475 $ 12,690 $ 45,827 $ 36,782
========= ========= =========== =========
BASIC EARNINGS (LOSS) PER
SHARE:
Class A common stock
Income from continuing
operations $ 0.51 $ 0.41 $ 1.35 $ 1.21
(Loss) from discontinued
operations, net of taxes - (0.03) - (0.11)
--------- --------- ----------- ---------
Class A basic earnings per
share $ 0.51 $ 0.38 $ 1.35 $ 1.10
========= ========= =========== =========
Weighted average common
shares outstanding 19,779 18,534 19,555 18,325
========= ========= =========== =========
Class B common stock
Income from continuing
operations $ 0.51 $ 0.41 $ 1.35 $ 1.21
(Loss) from discontinued
operations, net of taxes - (0.03) - (0.11)
--------- --------- ----------- ---------
Class B basic earnings per
share $ 0.51 $ 0.38 $ 1.35 $ 1.10
========= ========= =========== =========
Weighted average common
shares outstanding 14,382 15,064 14,459 15,065
========= ========= =========== =========
DILUTED EARNINGS (LOSS) PER
SHARE:
Class A common stock
Income from continuing
operations $ 0.51 $ 0.41 $ 1.33 $ 1.19
(Loss) from discontinued
operations, net of taxes - (0.04) - (0.10)
--------- --------- ----------- ---------
Class A diluted earnings
per share $ 0.51 $ 0.37 $ 1.33 $ 1.09
========= ========= =========== =========
Weighted average common
shares outstanding 20,181 18,906 19,966 18,743
========= ========= =========== =========
Class B common stock
Income from continuing
operations $ 0.51 $ 0.41 $ 1.33 $ 1.19
(Loss) from discontinued
operations, net of taxes - (0.04) - (0.10)
--------- --------- ----------- ---------
Class B diluted earnings
per share $ 0.51 $ 0.37 $ 1.33 $ 1.09
========= ========= =========== =========
Weighted average common
shares outstanding 14,382 15,064 14,459 15,065
========= ========= =========== =========
MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(unaudited)
Nine months ended
September 30,
--------------------
2007 2006
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 45,827 $ 36,782
Adjustments to reconcile net income to net cash
provided by operating activities:
Loss from discontinued operation, net of tax 458 3,521
Gain on sale of discontinued operation, net
of tax (338) -
Stock-based compensation 5,203 4,095
Excess tax benefits from the exercise of
stock options (1,277) (1,573)
Deferred income taxes (830) (2,278)
Depreciation and amortization 10,647 7,495
Change in assets and liabilities--net of effects
from acquired and disposed businesses:
Receivables-net (5,968) 33,939
Prepaid expenses and other 3,380 (3,333)
Accounts payable and accrued expenses 12,014 5,797
Accrued salaries and related expenses (5,220) 631
Billings in excess of revenue earned (769) (1,575)
Accrued retirement 1,510 2,343
Other (493) (1,741)
--------- ---------
Net cash flow from operating activities of
continuing operations 64,144 84,103
Net cash flow from discontinued operations (1,562) (5,934)
--------- ---------
Net cash flow from operating activities 62,582 78,169
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (1,760) (3,585)
Investment in capitalized software for internal
use (1,556) (2,126)
Proceeds from the sale of property and equipment 1,828 3
Exercise of GSE warrants (133) -
Proceeds from sale of GSE shares 600 -
Acquisition of business, net of cash acquired (197,016) -
--------- ---------
Net investing cash flow from continuing
operations (198,037) (5,708)
Net investing cash flow from discontinued
operations 3,000 (125)
--------- ---------
Net cash flow from investing activities (195,037) (5,833)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 9,447 10,255
Excess tax benefits from the exercise of stock
options 1,277 1,573
Excess tax benefit from distribution of shares
held in grantor trust 8,581 -
Treasury stock acquired (9,114) -
Borrowing under line of credit, non-current 10,000 -
Net increase (decrease) in borrowing under lines
of credit net of associated origination fees 74,292 (42,402)
Repayment of notes payable - (79)
--------- ---------
Net cash flow from financing activities 94,483 (30,653)
--------- ---------
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS (37,972) 41,683
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 41,510 5,678
--------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 3,538 $ 47,361
========= =========
SOURCE: ManTech International Corporation
ManTech International Corporation
Joseph Cormier
Vice President, Corporate Development
703-218-8258
joe.cormier@mantech.com
or
Mark Root
Executive Director, Corporate Communications
703-218-8397; cell: 571-259-1169
mark.root@mantech.com
