Leidos Holdings, Inc. · NYSE:LDOS
Leidos — Q2 2019 Earnings Presentation
16 slides from Leidos's earnings presentation, Jul 30, 2019
Slide 1: Leidos 2Q 2019 Earnings Conference Call
Leidos 2Q 2019 Earnings Conference Call July 30, 2019
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: 2Q FY 2019 Highlights
2Q FY 2019 Highlights Delivered $2.73B of revenue for the quarter Continuing Strong revenue growth of 8.8% organic(1), 7.9% year-over-year Revenue Growth Adjusted EBITDA Margins of 10.0% Acceleration Grew backlog to a record $21.7B Generating Strong Generated Operating Cash flows of $186M
Slide 4: Leidos 2Q FY19 Results
Leidos 2Q FY 19 Results Non-GAAP Adjusted EBITDA Cash Flows from Revenue ($B) Diluted EPS Margin Operations ($) (%) ($M) $2.7 +7.9% 10.9% $271 $1.12 $1.16 10.0% $2.5 +3.6% -90bps $186 -$85M 2Q FY18 2Q FY19 2Q FY18 2Q FY19 2Q FY18 2Q FY19 2Q FY18 2Q FY19 Note: See appendix for definition & reconcilia
Slide 5: Defense Solutions Segment
Defense Solutions Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M) (%) $1,346 8.8% $1,262 8.6% $111 $116 +6.7% -20bps +4.5% 2Q FY18 2Q FY19 2Q FY18 2Q FY19 2Q FY18 2Q FY19 Note: See appendix for definition & reconciliation of Non-GAAP Financial Measures 5
Slide 6: Civil Segment
Civil Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M) (%) $881 $816 10.3% 9.9% $84 $87 +8.0% +3.6% -40bps 2Q FY18 2Q FY19 2Q FY18 2Q FY19 2Q FY18 2Q FY19 Note: See appendix for definition & reconciliation of Non-GAAP Financial Measures 6
Slide 7: Health Segment
Health Segment Revenue Non-GAAP Operating Income Non-GAAP Operating Margin ($M) ($M) (%) $501 $80 17.7% $451 +11.1% $72 -10.0% 14.4% -330bps 2Q FY18 2Q FY19 2Q FY18 2Q FY19 2Q FY18 2Q FY19 Note: See appendix for definition & reconciliation of Non-GAAP Financial Measures 7
Slide 8: Backlog & Book-to-Bill
Backlog & Book-to-Bill 20.8 21.5 21.7 20.3 Backlog1 ($B) 18.3 14.2 14.4 15.4 15.4 13.0 5.3 6.1 6.4 6.1 6.3 2QFY18 3QFY18 4QFY18 1QFY19 2QFY19 1.8 Book-to-Bill2 1.4 1.3 1.2 1.1 2QFY18 3QFY18 4QFY18 1QFY19 2QFY19 Funded Backlog Negotiated Unfunded Backlog (1) Backlog presented at exchange rate in effe
Slide 9: 2019 Guidance
2019 Guidance Current Prior Revenue $10.65B - $10.95B $10.50B - $10.90B Adjusted EBITDA Margin(1) 9.9% - 10.1% 9.9% - 10.1% Non-GAAP Diluted EPS(1,2) $4.50 - $4.75 $4.30 - $4.65 Operating Cash Flow Meet or exceed $825M(3) Meet or exceed $825M(3) (1) A quantitative reconciliation of adjusted EBITDA m
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 margin, non-GAAP effective tax rate, non-GAAP diluted earnings per share (EPS), adjusted earnings before interest, taxes, depreciation and amortization (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) non-operating expense, net; (ii) income tax expense, and (iii) the following discrete items: Integration and restructuring costs - Represents integration, lease ter
Slide 13: Non-GAAP Operating Income Reconciliation
Non-GAAP Operating Income Reconciliation 1QFY18 2QFY18 3QFY18 4QFY18 FY18 1QFY19 2QFY19 (in millions) Operating income $ 159 $ 199 $ 203 $ 188 $ 749 $ 192 $ 210 Integration and restructuring costs 17 8 7 5 37 2 1 Amortization of acquired intangibles 50 51 50 50 201 42 43 Amortization of equity metho
Slide 14: Reportable Segments Non-GAAP Operating Income Reconciliation
Reportable Segments Non-GAAP Operating Income Reconciliation Quarter Ended June 28, 2019 (in millions) Operating income Integration and Amortization of Amortization of equity Non-GAAP operating (loss) restructuring costs acquired intangibles method investment income (loss) Defense Solutions $ 101 $
Slide 15: Non-GAAP Financial Measures Reconciliation
Non-GAAP Financial Measures Reconciliation 1QFY18 2QFY18 3QFY18 4QFY18 FY18 1QFY19 2QFY19 (in millions, except per share amounts) Non-GAAP operating income $ 236 $ 260 $ 262 $ 246 $ 1,004 $ 239 $ 256 Depreciation expense 13 15 14 14 56 15 14 Other income (expense), net - 1 2 (4) (1) 4 3 Amortization
Slide 16: Non-GAAP Financial Measures Reconciliation (cont'd)
Non-GAAP Financial Measures Reconciliation (cont’d) Quarter Ended June 28, 2019 (in millions, except per share amounts) Integration and Amortization of acquired Amortization of equity As reported restructuring costs intangibles method investment Loss on sale of business Non-GAAP results Operating in