Leidos Holdings, Inc. · NYSE:LDOS
Leidos — Merger or Acquisition (February 2020)
13 slides from Leidos's merger presentation, Feb 4, 2020
Slide 1: Leidos to Acquire L3Harris Security Detection & Automation Businesses
Leidos to Acquire L3Harris Security Detection & Automation Businesses February 4, 2020
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements The forward-looking statements contained in this presentation involve risks and uncertainties that may affect Leidos’ operations, markets, products, services, prices and other factors as discussed in filings with the Securities and Exchange C
Slide 3: Transaction Overview
Terms $ Financing • Total cash price of $1.0 billion • Transaction will be funded through cash on hand and incremental debt • Represents forward EBITDA multiple of ~13.3x times CY20, or ~9.4 times • Net leverage* ratio of ~3.7x expected CY21 at close Transaction Overview Financial Timing & Closing B
Slide 4: Security Detection & Automation Businesses Overview
Highlights Key Products L3Harris Checkpoint Security Products Security Detection & Security Detection: Leading Checkpoint CT scanners, people provider of airport and critical scanners, and comprehensive infrastructure screening explosives trace detectors Automation Businesses products and services C
Slide 5: Compelling Strategic Benefits
Compelling Strategic Benefits • Adds complementary products that expand Leidos’ offerings to create a more Expands Product Portfolio in High- comprehensive security detection platform Growth Global Security Market • Projected 3-year revenue CAGR of acquired businesses in low to mid-teens • Global Se
Slide 6: Expands Product Portfolio in High-Growth Security Market
Expands Product Portfolio in High-Growth Security Market People Checkpoint Checkpoint Explosive Automation Checked Checked Ports & Scanners X-Ray CT Trace Baggage: Baggage: Borders In-line Stand- Alone Complementary product portfolio Note: Graphic depicts deployed products 6
Slide 7: Diversifies Revenues Through Increased International Presence
Diversifies Revenues Through Increased International Presence Countries where Leidos Security products are deployed. Additional countries where L3Harris Security Detection and Automation products are deployed. Leidos’ International Revenue Mix will increase to 13% from 10% 7
Slide 8: Enhanced Scale Accelerates Growth & Innovation
Enhanced Scale Accelerates Growth & Innovation Checkpoint Border Security Border Security Security Products Checkpoint Security Products Products Products ~ 5% ~35% Checked Baggage ~ 25% ~ 25% Products Checked ~ 15% Baggage Products Combined ~ 22% Checked CY20E Revenue CY20E CY20E Revenue Baggage ~$
Slide 9: Transaction Offers Significant Financial Benefits
Transaction Offers Significant Financial Benefits Clearly Identified and Higher Margin Portfolio Immediate Earnings High Cash Achievable Synergies Transaction expected to drive Accretion Efficiency Expected to generate Leidos’ adjusted EBITDA margin Immediately accretive to non- Capital-light busine
Slide 10: Transaction Creates Value for All Stakeholders
Transaction Creates Value for All Stakeholders Shareholders Customers Employees Accelerates revenue growth Accelerates innovation across a more Consistent with our mission of comprehensive security product making the world safer Diversifies revenue with increased platform international exposure Alig
Slide 11: Appendix
*leidos © L3HARRIS Appendix
Slide 12: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes certain non-GAAP financial measures, such as non-GAAP operating income, non-GAAP diluted earnings per share (EPS), adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA margin. These are not measures o
Slide 13: 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
Leidos Holdings — Merger or Acquisition (February 2020) on 6ix