Leidos Holdings, Inc. · NYSE:LDOS
Leidos — Q2 2017 Earnings Presentation
15 slides from Leidos's earnings presentation, Aug 3, 2017
Slide 1: Leidos 2Q 2017 Earnings Conference Call
Leidos 2Q 2017 Earnings Conference Call August 3, 2017
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements in this presentation contain or are based on “forward-looking” information within the meaning of the Private Securities Litigation Reform Act of 1995. Actual performance and results may differ materially from the guidance and other forward-looking statem
Slide 3: 2Q FY 2017 Highlights
2Q FY 2017 Highlights ► $1.04 Non-GAAP(1) Diluted Earnings Per Share ► 10.9% Adjusted EBITDA Margin The new Leidos 2018 & beyond(2) ► Raising guidance for Non-GAAP(1) EPS by >$0.30 at midpoint 3% revenue growth 10%+ Adjusted EBITDA margin 100%+ cash efficiency ► Raising Gross Cost Synergies target t
Slide 4: Leidos 2Q FY 17 Results
Leidos 2Q FY 17 Results Non-GAAP Adjusted EBITDA Cash Flow from Revenue ($B) Diluted EPS Margin Operations ($)2 (%)2 ($M) -5%1 +53% +350bps +$105M $2.6 $1.04 10.9% $177 $0.68 7.4% $1.3 $72 $1.3 $1.2 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 Adjusted revenue of $1.27B in
Slide 5: Defense Solutions Segment
Defense Solutions Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M)2 (%)2 -1.3%1 +82% +120bps $1,243 $109 8.8% 7.6% $785 $60 $775 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 Adjusted revenue of $775M in 2QFY17 excludes contributions from IS&GS acquisition. IS&GS
Slide 6: Civil Segment
Civil Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M)2 (%)2 -11.7%1 +336% +370bps $875 11.0% $96 7.3% $300 $22 $283 $250 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 Adjusted revenue of $283M in 2QFY16 and $250M in 2QFY17 represent organic revenue comparisons,
Slide 7: Health Segment
Health Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M)2 (%)2 -9.9%1 +311% +740bps $454 16.3% $74 8.9% $18 $203 $183 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 2Q FY 16 2Q FY 17 Adjusted revenue of $183M in 2QFY17 excludes contributions from IS&GS acquisition. IS&GS revenues of
Slide 8: Awards & Backlog
Awards & Backlog Defense Solutions Civil Health $9,000 $8,107 $3,000 $2,811 $8,000 $7,577 $7,390 $8,000 $7,200 $2,500 $2,429 $7,000 $7,062 $6,890 $2,250 $7,000 Backlog* ($M) $6,000 $4,936 $6,000 $2,000 $5,000 $5,005 $5,064 $5,000 $2,151 $5,250 $4,883 $1,575 $4,000 $5,466 $1,500 $4,000 $1,566 $3,000
Slide 9: 2017 Guidance Update
2017 Guidance Update Current Prior Revenue $10.1B to $10.4B $10.0B to $10.4B Adjusted EBITDA Margin(1) 9.8% to 10.2% 9.5% to 10.0% Non-GAAP Diluted EPS(1) $3.45 to $3.60 $3.05 to $3.35 Non-GAAP Effective Tax Rate 35% to 35.5% ~37% Operating Cash Flow from Continuing Operations Unchanged Meet or exce
Slide 10: Appendix
Appendix * leidos
Slide 11: Non-GAAP Reconciliations
Non-GAAP Reconciliations This presentation includes certain non-GAAP financial measures, such as non-GAAP operating income, non-GAAP operating income margin, non-GAAP diluted earnings per share (EPS), adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), and adjusted EBIT
Slide 12: Definition of Non-GAAP Financial Measures
Definition of Non-GAAP Financial Measures Non-GAAP operating income is computed by excluding the following items from income (loss) from continuing operations: (i) other (expense) income, net; (ii) interest expense; (iii) interest income; (iv) income tax expense adjusted to reflect non-GAAP adjustme
Slide 13: Non-GAAP Operating Income Reconciliation
Non-GAAP Operating Income Reconciliation 1QCY151 2QCY151 3QCY151 4QCY151 CY151 1QFY16 2QFY16 3QFY16 4QFY16 FY16 1QFY17 2QFY17 (in millions) GAAP operating income from continuing operations $ 38 $ 64 $ 94 $ 102 $ 298 $ 89 $ 75 $ 101 $ 152 $ 417 $ 141 $ 166 Acquisition and integration costs - - - - -
Slide 14: Non-GAAP Financial Measures Reconciliation
Non-GAAP Financial Measures Reconciliation 1QCY151 2QCY151 3QCY151 4QCY151 CY151 1QFY162 2QFY16 3QFY16 4QFY16 FY16 1QFY17 2QFY17 (in millions, except for per share amounts) Non-GAAP operating income from continuing operations $ 82 $ 96 $ 101 $ 107 $ 386 $ 99 $ 93 $ 177 $ 240 $ 609 $ 242 $ 264 Deprec
Slide 15: Segment Non-GAAP Operating Income Reconciliation
Segment Non-GAAP Operating Income Reconciliation Quarter Ended June 30, 2017 (in millions) Operating income Acquisition and Amortization of Restructuring Amortization of equity Non-GAAP operating (loss) integration costs intangibles expenses method investments income (loss) Defense Solutions $ 63 $