Leidos Holdings, Inc. · NYSE:LDOS
Leidos — Q4 2021 Earnings Presentation
19 slides from Leidos's earnings presentation, Feb 15, 2022
Slide 1: Leidos Q4 FY21 Earnings Conference Call
Leidos Q4 FY21 Earnings Conference Call February 15, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements in this release contain or are based on "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by words such as "expects," "intends," "plans," "
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes certain non-GAAP financial measures, such as organic growth, non-GAAP operating income, non- GAAP operating margin, non-GAAP effective tax rate, non-GAAP diluted earnings per share (EPS), adjusted earnings before interest, taxes, depreciation an
Slide 4: CEO Key Messages
CEO Key Messages 1 Strong financial performance ▪ Revenues up 7% for the quarter and up 12% for the year ▪ 2021 adjusted EBITDA margin of 11.0%; 14% increase in non-GAAP EPS ▪ Cash generation well ahead of expectations Balanced capital allocation to create shareholder value 2 ▪ Strategic investment
Slide 5: FY21 and Q4 Results: Income Statement
FY21 and Q4 Results: Income Statement Revenues (M) Adjusted EBITDA Margin Non-GAAP Diluted EPS $13,737 $6.62 $12,297 $5.83 10.8% 11.0% Fiscal Year +12% total +20 bps +14% +9% organic $13,412 FY20 FY21 FY20 FY21 FY20 FY21 $3,491 $3,252 $1.63 $1.56 11.3% 10.3% -4% +7% total +6% organic -100 bps Q4 $3,
Slide 6: FY21 and Q4 Results: Segment Revenues ($M)
FY21 and Q4 Results: Segment Revenues ($M) Defense Solutions Civil Health $2,548 $8,032 $3,157 $7,341 $2,994 $1,962 Fiscal Year +9% total +5% total +30% total +6% organic +2% organic $7,800 $3,064 FY20 FY21 FY20 FY21 FY20 FY21 $811 $630 $800 $2,061 $513 $1,928 +7% total -1% total +4% organic Q4 +23%
Slide 7: FY21 and Q4 Results: Segment Non-GAAP Margin
FY21 and Q4 Results: Segment Non-GAAP Margin Defense Solutions Civil Health 18.8% 11.7% 8.6% 10.2% 14.4% Fiscal Year 8.2% -150 bps +440 bps +40 bps FY20 FY21 FY20 FY21 FY20 FY21 18.5% 17.8% 12.3% 8.9% 10.0% 8.2% -70 bps -70 bps -230 bps Q4 7
Slide 8: FY21 and Q4 Results: Cash Flow/Balance Sheet
FY21 and Q4 Results: Cash Flow/Balance Sheet Exceptional cash generation—strong operational focus Q4 FY21 Cash Flow ▪ Operating cash flow $210M $1,031M Generation ▪ Free cash flow $177M $927M ▪ Cash tax repayment from 2020 CARES Act — $(62)M Following balanced long-term capital deployment approach Q
Slide 9: 2022 Guidance
2022 Guidance Current Prior Measure FY22 Guidance Revenues (billions) $13.9 - $14.3 Adjusted EBITDA Margin 10.3% - 10.5% Non-GAAP Diluted EPS $6.10 - $6.50 Cash Flows Provided by Operating Activities (billions) at or above $1.0* * The guidance for cash flows provided by operating activities assumes
Slide 10: 2022 Guidance Assumptions
2022 Guidance Assumptions Prior ▪ Customers may adopt new protocols associated with COVID-19 but do not revert to closed offices or work stoppages COVID-Related ▪ No major changes in workforce participation due to vaccine mandates Factors ▪ Supply chain shortages do not worsen, and we are able to me
Slide 11: Appendix: Non-GAAP Reconciliations
Appendix: Non-GAAP Reconciliations
Slide 12: Organic Growth
Organic Growth Percent Percent (in millions, except growth rates) Q4 FY21 Q4 FY20 Change FY21 FY20 Change Defense Solutions Revenues, as reported $ 2,061 $ 1,928 7% $ 8,032 $ 7,341 9% FY21 acquisition revenues(1) 52 — 232 — Pro-forma revenues (Organic Growth Rate) $ 2,009 $ 1,928 4% $ 7,800 $ 7,341
Slide 13: Non-GAAP Income Metrics Reconciliation (Quarter)
Non-GAAP Income Metrics Reconciliation (Quarter) Three Months Ended December 31, 2021 Three Months Ended January 1, 2021 Acquisition, Acquisition, integration integration and Amortization Asset and Amortization Asset restructuring of acquired impairment Loss on sale Non-GAAP restructuring of acquire
Slide 14: Non-GAAP Income Metrics Reconciliation (FY)
Non-GAAP Income Metrics Reconciliation (FY) Year Ended December 31, 2021 Year Ended January 1, 2021 Acquisition, Acquisition, integration integration Amortization Acquisition and Amortization Asset and Amortization of equity related Loss on Asset (in millions, except per share restructuring of acqui
Slide 15: Segment Non-GAAP OI Reconciliation (Quarter)
Segment Non-GAAP OI Reconciliation (Quarter) Three Months Ended December 31, 2021 Acquisition, integration and Amortization of Asset Non-GAAP Non-GAAP Operating restructuring acquired impairment operating operating (in millions) income (loss) costs intangibles charges income (loss) margin(1) Defense
Slide 16: Segment Non-GAAP OI Reconciliation (FY)
Segment Non-GAAP OI Reconciliation (FY) Year Ended December 31, 2021 Acquisition, integration and Amortization of Asset Non-GAAP Non-GAAP Operating restructuring acquired impairment operating operating (in millions) income (loss) costs intangibles charges income (loss) margin(1) Defense Solutions $
Slide 17: Free Cash Flow
Free Cash Flow Three Months Ended Year Ended December 31, January 1, December 31, January 1, (in millions, except conversion ratio) 2021 2021 2021 2021 Net cash provided by (used in) operating activities $ 210 $ (52) $ 1,031 $ 1,334 Payments for property, equipment and software (33) (63) (104) (183)
Slide 18: Three-Year Organic Growth Reconciliation
Three-Year Organic Growth Reconciliation Year Ended Compound December 31, December 28, Annual Growth 2021 2018 Rate Revenues, as reported $ 13,737 $ 10,194 10 % Divested revenues — 235 Pro-forma revenues, post divestitures $ 13,737 $ 9,959 Acquired revenues 12 months since closing date 325 — Acquire
Slide 19: Three-Year EBITDA/Cash Metrics Reconciliation
Three-Year EBITDA/Cash Metrics Reconciliation Year Ended December 31, 2021 January 1, 2021 January 2, 2020 Revenues, as reported $ 13,737 $ 12,297 $ 11,094 Net income, as reported $ 759 $ 629 $ 670 Less: net income attributable to non-controlling interest 6 1 3 Net income attributable to Leidos stoc