Leidos Holdings, Inc. · NYSE:LDOS
Leidos — Q1 FY2018 Earnings Presentation
15 slides from Leidos's earnings presentation, May 3, 2018
Slide 1: Leidos 1Q 2018 Earnings Conference Call
Leidos 1Q 2018 Earnings Conference Call May 3, 2018
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: 1Q FY 2018 Highlights
1Q FY 2018 Highlights 1.02x Book to Bill Positioned for Growth Highest Q1 Book to Bill in Past Five Years 10.2% Adjusted EBITDA Margin Strong Margins Driven by Solid Program Execution Successfully Completed Realized Gross Cost Synergy Target of >$400M IS&GS Integration Note: See appendix f
Slide 4: Leidos 1Q FY 18 Results
Leidos 1Q FY 18 Results Revenue Non-GAAP Adjusted EBITDA Cash Flow from ($B) Diluted EPS Margin Operations ($) (%) ($M) $2.6 $2.4 $1.03 10.0% 10.2% -5% $0.88 +20 bps +17% $22 ($71) +93M 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 Note: See appendix for definition & reconc
Slide 5: Leidos Backlog & Book to Bill
Leidos Backlog & Book to Bill 17.1 17.7 17.5 17.6 16.9 Backlog1 ($B) 12.1 12.1 12.5 13.0 12.0 4.9 5.0 5.6 5.0 4.6 1QFY17 2QFY17 3QFY17 4QFY17 1QFY18 Book to Bill2 1.0 1.2 1.0 0.9 0.7 1QFY17 2QFY17 3QFY17 4QFY17 1QFY18 Funded Backlog Negotiated Unfunded Backlog (1) Backlog presented at exchange rate
Slide 6: Defense Solutions Segment
Defense Solutions Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M) (%) $1,294 $1,178 $102 8.7% -9% $95 7.3% +7% +132 bps 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 Note: See appendix for definition & reconciliation of Non-GAAP Financial Measures 6 ©2018 LEIDOS
Slide 7: Civil Segment
Civil Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M) (%) $842 $840 flat $99 11.8% $88 10.5% +13% +133 bps 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 Note: See appendix for definition & reconciliation of Non-GAAP Financial Measures 7 ©2018 LEIDOS. ALL RIGHTS
Slide 8: Health Segment
Health Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M) (%) $443 14.9% $425 $66 12.5% -4% $53 -243 bps -20% 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 1Q FY 17 1Q FY 18 Note: See appendix for definition & reconciliation of Non-GAAP Financial Measures 8 ©2018 LEIDOS. ALL RIGHTS
Slide 9: 2018 Guidance
2018 Guidance Current Prior Revenue Unchanged $10.25B to $10.65B Adjusted EBITDA Margin(1) Unchanged 10.1% to 10.4% Non-GAAP Diluted EPS(1,2) Unchanged $4.15 to $4.50 Operating Cash Flow Unchanged Meet or exceed $675M(3) (1) A quantitative reconciliation of adjusted EBITDA margin and non-GAAP dilute
Slide 10: Appendix
Appendix * leidos
Slide 11: Non-GAAP Financial Measures
Non-GAAP Financial Measures 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 E
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 net income: (i) other (expense) income, net; (ii) interest expense; (iii) interest income; (iv) the following discrete items (referred to as non-GAAP adjustments); and (v) income tax
Slide 13: Non-GAAP Operating Income Reconciliation
Non-GAAP Operating Income Reconciliation 1QFY17 2QFY17 3QFY17 4QFY17 FY17 1QFY18 (in millions) Operating income $ 141 $ 166 $ 151 $ 101 $ 559 $ 159 Acquisition and integration costs 19 16 21 46 102 11 Amortization of acquired intangible assets 69 67 76 69 281 50 Restructuring expenses 13 6 6 12 37 6
Slide 14: Non-GAAP Financial Measures Reconciliation
Non-GAAP Financial Measures Reconciliation 1QFY172 2QFY172 3QFY17 4QFY17 FY17 1QFY18 (in millions, except per share amounts) Non-GAAP operating income $ 242 $ 264 $ 256 $ 231 $ 993 $ 236 Depreciation expense 13 13 16 13 55 13 Other income, net 3 4 - 1 8 - Adjusted EBITDA $ 258 $ 281 $ 272 $ 245 $ 1,
Slide 15: Segment Non-GAAP Operating Income Reconciliation
Segment Non-GAAP Operating Income Reconciliation Quarter Ended March 30, 2018 (in millions) Operating income Acquisition and Amortization of Restructuring Amortization of equity Asset impairment Non-GAAP operating (loss) integration costs intangibles expenses method investment charges income (loss)