MANT
$54.19
Mantech Intl Cp A
($.55)
(1.00%)
Earnings Details
1st Quarter March 2018
Wednesday, May 02, 2018 4:00:00 PM
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Summary

ManTech Raises Guidance but Remains In-line with Estimates

Mantech Intl Cp A (MANT) reported 1st Quarter March 2018 earnings of $0.51 per share on revenue of $473.2 million. The consensus earnings estimate was $0.48 per share on revenue of $467.9 million. Revenue grew 13.1% on a year-over-year basis.

The company said it expects 2018 earnings of $2.00 to $2.08 per share on revenue of $1.90 billion to $1.95 billion. The company's previous guidance was earnings of $1.96 to $2.05 per share on revenue of $1.88 billion to $1.95 billion and the current consensus earnings estimate is $2.01 per share on revenue of $1.92 billion for the year ending December 31, 2018.

Mantech International Corp provides technologies and solutions for mission-critical national security programs for the Intelligence Community, the departments of Defence, State, Homeland Security, Health and Human Services, Veterans Affairs and Justice.

Results
Reported Earnings
$0.51
Earnings Whisper
-
Consensus Estimate
$0.48
Reported Revenue
$473.2 Mil
Revenue Estimate
$467.9 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

ManTech Announces Financial Results for First Quarter of 2018

  • Revenues: $473 million, up 13% from first quarter of 2017
  • Operating Income: $26.4 million for an operating margin of 5.6%
  • Diluted EPS: $0.51, up 31% from first quarter of 2017
  • Bookings of $430 million, resulting in a book-to-bill ratio of 0.9 and a LTM book-to-bill of 2.2

FAIRFAX, Va., May 02, 2018 (GLOBE NEWSWIRE) -- ManTech International Corporation (Nasdaq:MANT), a leading provider of innovative technologies and solutions for mission-critical national security programs, today announced financial results for the first quarter of fiscal year 2018, which ended March 31, 2018.

“With the solid execution in the quarter, ManTech is well positioned for another successful year. We continue our strong trajectory with another quarter of robust organic revenue growth. Equally important is our commitment to invest for the future and our steadfast focus on delivering innovative and differentiated solutions to meet our customers' mission-critical requirements,” said ManTech President and Chief Executive Officer Kevin M. Phillips.

Summary Operating Results 
 Three months ended
March 31,
(In Millions Except Per Share Amounts)2018 2017
Revenue$473.2 $418.4
Operating Income$26.4 $24.4
Operating Margin5.6% 5.8%
Depreciation and Amortization$13.2 $7.7
Depreciation and Amortization % of Revenue2.8% 1.8%
Net Income$20.1 $15.0
Diluted Earnings Per Share$0.51 $0.39
    

As a result of increased demand for our services and solutions, revenues for the quarter were $473.2 million, up 13% from $418.4 million in the first quarter of 2017. Revenue growth was driven by a combination of organic expansion from recent contract awards and acquisitions.

Operating income for the quarter was $26.4 million, up 8% compared to the first quarter of 2017, representing an operating margin of 5.6%. For the quarter, net income was $20.1 million and diluted earnings per share were $0.51, up 34% and 31%, respectively, compared to the first quarter of 2017.

Cash Management and Capital Deployment 
 Three months ended
March 31,
(Dollars In Millions)

2018 2017
Net Income$20.1 $15.0
Cash Flow from Operations$(18.0) $36.5
Operating Cash Flow Multiple of Net Income(0.9)x 2.4x
Capital Expenditures$8.7 $3.4
Days Sales Outstanding (DSO)69 68
Cash and Cash Equivalents, End of Period$10.4 $91.6
Current and Long Term Debt, End of Period$65.5 $0.0
    

The company used $18.0 million of net cash flow to fund operating activities in the quarter. Days sales outstanding (DSO) were 69 days. As of March 31, 2018, the company had $10.4 million in cash and cash equivalents and $65.5 million of outstanding borrowings on its $500 million revolving-credit facility, which leaves the company with ample financial capacity to support growth, pursue acquisitions and issue dividends while maintaining a strong balance sheet.

The company paid $9.9 million in dividends, or $0.25 per share, to its common stockholders of record as of March 9, 2018. The Board of Directors has declared that the company will pay a cash dividend of $0.25 per share on June 22, 2018, to all common stockholders of record as of June 8, 2018, as part of its regular quarterly cash dividend program. Future declarations of dividends and their record and payment dates are subject to the final determination of ManTech's Board of Directors.

Contract Awards

Contract awards (bookings) totaled $430 million in the quarter, representing a book-to-bill ratio of 0.9. Over the trailing 12 months, the book-to-bill ratio is 2.2. ManTech won several large, single-award contracts in the quarter including:

  • C4I Integration in U.S. Marine Corps (USMC) Combat Vehicles. ManTech was awarded a 5-year contract totaling $82 million by the Navy's Space and Naval Warfare Systems Center (SPAWAR SSC) to augment Command, Control, Communications, Computers and Intelligence (C4I) capabilities of USMC combat vehicles.

Additional contract awards in the quarter include several extensions to existing contracts and new contracts from various customers, most of which are classified.

In addition, the company won several multiple-award indefinite-delivery, indefinite-quantity (IDIQ) contracts, which are not included in bookings, including:

  • Defense Information Systems Agency (DISA) ENCORE III. Under this 10-year, $17.5 billion contract ManTech will have the opportunity to win task orders to provide a range of IT solutions.

The company’s backlog of business at the end of quarter was $7.1 billion and funded backlog was $1.2 billion.

Forward Guidance

Based on our strong performance in the first quarter, we are raising and narrowing our 2018 guidance range on revenue, net income, and diluted earnings per share as specified in the table below.

MeasureFiscal 2018 Guidance
Revenue (billion)$1.90 - $1.95
Net Income (million)$80.1 - $83.3
Diluted Earnings per Share$2.00 - $2.08
  

ManTech Chief Financial Officer Judith L. Bjornaas said, "I am pleased to see the strong organic performance of the business, which met all of our financial targets for the first quarter. ManTech's positioning in important national and homeland security missions provides a solid foundation for continued growth."

Conference Call

ManTech executive management will hold a conference call on May 2, 2018, at 5 p.m. Eastern to discuss the financial results and outlook and answer questions. Analysts may participate on the conference call by dialing 877-638-9567 (domestic) or 253-237-1032 (international) and entering passcode 6293764. The conference call will be webcast simultaneously to the public through a link on the Investor Relations section of the ManTech website (http://investor.mantech.com). A replay of the conference call will be available on the ManTech website approximately 2 hours after the conclusion of the conference call.

About ManTech International Corporation

ManTech provides mission-focused technology solutions and services for U.S. defense, intelligence community and federal civilian agencies. Now in our 50th year, we excel in full-spectrum cyber, data collection & analytics, enterprise IT, systems engineering and software application development solutions that support national and homeland security. 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,” “expect,” “intend,” “anticipate,” “believe,” or “estimate,” or the negative of these terms or words of similar import, are intended to identify forward-looking statements.

These forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes we anticipate. Factors that could cause actual results to differ materially from the results we anticipate include, but are not limited to, the following: failure to maintain our relationship with the U.S. government, or failure to compete effectively for new contract awards or to retain existing U.S. government contracts; inability to recruit and retain sufficient number of employees with specialized skill sets or necessary security clearances who are in great demand and limited supply; issues relating to competing effectively for awards procured through the competitive bidding process, including the adverse impact of delay caused by competitors’ protests of contracts awards received by us; adverse changes in U.S. government spending for programs we support, whether due to changing mission priorities, socio-economic policies that reduce the contracts that we may bid on, cost reduction and efficiency initiatives by our customers, or other federal budget constraints generally; failure to obtain option awards, task orders or funding under contracts; failure to realize the full amount of our backlog or adverse changes in the timing of receipt of revenues under contracts included in backlog; renegotiation, modification or termination of our contracts, or failure to perform in conformity with contract terms or our expectations; disruption of our business or damage to our reputation resulting from security breaches in customer systems, internal systems or services failures (including as a result of cyber or other security threats), or employee or subcontractor misconduct; failure to successfully integrate acquired companies or businesses into our operations or to realize any accretive or synergistic effects from such acquisitions; increased exposure to risks associated with conducting business internationally; non-compliance with, or adverse changes in, complex U.S. government laws, procurement regulations or processes; and adverse results of U.S. government audits or other investigations of our government contracts. These and other risk factors are more fully discussed in the section entitled "Risk Factors" in ManTech's Annual Report on Form 10-K previously filed with the Securities and Exchange Commission on Feb. 23, 2018, Item 1A of Part II of our Quarterly Reports on Form 10-Q, and, from time to time, in ManTech's other filings with the Securities and Exchange Commission.

The forward-looking statements included herein are only made as of the date of this press 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
(In Thousands Except Share and Per Share Amounts)
 
 (unaudited)
 March 31,
 2018
 December 31,
 2017
ASSETS   
Cash and cash equivalents$10,382  $9,451 
Receivables—net364,180  311,410 
Prepaid expenses and other49,360  46,207 
Contractual inventory92  96 
Total Current Assets424,014  367,164 
Goodwill1,085,321  1,084,560 
Other intangible assets—net189,452  194,348 
Property and equipment—net50,288  46,082 
Employee supplemental savings plan assets33,300  33,555 
Investments11,848  11,843 
Other assets7,383  6,923 
TOTAL ASSETS$1,801,606  $1,744,475 
LIABILITIES AND STOCKHOLDERS' EQUITY   
LIABILITIES   
Accounts payable and accrued expenses$134,870  $122,405 
Accrued salaries and related expenses77,087  87,064 
Contract liabilities21,876  18,816 
Total Current Liabilities233,833  228,285 
Long term debt65,500  31,000 
Deferred income taxes101,163  97,194 
Accrued retirement32,293  34,517 
Other long-term liabilities10,718  10,505 
TOTAL LIABILITIES443,507  401,501 
COMMITMENTS AND CONTINGENCIES   
STOCKHOLDERS' EQUITY   
Common stock, Class A—$0.01 par value; 150,000,000 shares authorized;
26,576,960 and 26,285,773 shares issued at March 31, 2018 and
December 31, 2017; 26,332,847 and 26,041,660 shares outstanding at
March 31, 2018 and December 31, 2017
266  263 
Common stock, Class B—$0.01 par value; 50,000,000 shares authorized;
13,189,245 and 13,189,245 shares issued and outstanding at March 31,
2018 and December 31, 2017
132  132 
Additional paid-in capital496,354  492,030 
Treasury stock, 244,113 and 244,113 shares at cost at March 31, 2018 and December 31, 2017(9,158) (9,158)
Retained earnings870,814  860,027 
Accumulated other comprehensive loss(309) (320)
TOTAL STOCKHOLDERS’ EQUITY1,358,099  1,342,974 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$1,801,606  $1,744,475 
        
        


MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
 
 (unaudited)
Three months ended
March 31,
 2018 2017
REVENUE$473,236  $418,374 
Cost of services403,933  357,047 
General and administrative expenses42,882  36,937 
OPERATING INCOME26,421  24,390 
Interest expense(734) (294)
Interest income15  24 
Other income, net4  39 
INCOME FROM OPERATIONS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS25,706  24,159 
Provision for income taxes(5,679) (9,100)
Equity in gains (losses) of unconsolidated subsidiaries40  (31)
NET INCOME$20,067  $15,028 
BASIC EARNINGS PER SHARE:   
Class A common stock$0.51  $0.39 
Class B common stock$0.51  $0.39 
DILUTED EARNINGS PER SHARE:   
Class A common stock$0.51  $0.39 
Class B common stock$0.51  $0.39 
        
        


MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
 
 (unaudited)
Three months ended
March 31,
 2018 2017
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES:   
Net income$20,067  $15,028 
Adjustments to reconcile net income to net cash flow from (used in) operating activities:   
Depreciation and amortization13,209  7,674 
Deferred income taxes3,969  3,653 
Stock-based compensation1,054  1,067 
Equity in (gains) losses of unconsolidated subsidiaries(40) 31 
Change in assets and liabilities—net of effects from acquired businesses:   
Receivables—net(45,458) 5,645 
Prepaid expenses and other(3,255) 4,411 
Contractual inventory4  1,192 
Employee supplemental savings plan asset255  (1,287)
Accounts payable and accrued expenses4,980  (2,644)
Accrued salaries and related expenses(9,873) 3,646 
Contract liabilities(397) (899)
Accrued retirement(2,224) (655)
Other(306) (333)
Net cash flow from (used in) operating activities(18,015) 36,529 
CASH FLOWS (USED IN) INVESTING ACTIVITIES:   
Purchases of property and equipment(6,574) (2,578)
Investment in capitalized software for internal use(2,097) (817)
Deferred contract costs(295)  
Net cash used in investing activities(8,966) (3,395)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:   
Borrowing under revolving credit facility191,000   
Repayments under revolving credit facility(156,500)  
Dividends paid(9,861) (8,137)
Proceeds from exercise of stock options5,996  1,694 
Payment consideration to tax authority on employees' behalf(2,723)  
Net cash flow from (used in) financing activities27,912  (6,443)
NET CHANGE IN CASH AND CASH EQUIVALENTS931  26,691 
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD9,451  64,936 
CASH AND CASH EQUIVALENTS, END OF PERIOD$10,382  $91,627 
 

ManTech-F


ManTech International Corporation

Investor Relations
Judy Bjornaas
Executive Vice President and Chief Financial Officer
(703) 218-8269
Investor.Relations@ManTech.com 

Media
Sue Cushing
VP Corporate Communications
(703) 814-8369
Sue.Cushing@ManTech.com 

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Source: ManTech International Corporation