Leidos Holdings, Inc. · NYSE:LDOS
Leidos — Q3 2021 Earnings Presentation
14 slides from Leidos's earnings presentation, Nov 2, 2021
Slide 1: Leidos Q3 FY21 Earnings Conference Call
Leidos Q3 FY21 Earnings Conference Call November 2, 2021
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 Financial results—record revenues and profits ▪ 6.0% organic growth—taking market share ▪ Non-GAAP diluted EPS up 22% YoY; 11.6% adjusted EBITDA margin ▪ 211% free cash flow conversion—cash generation is a hallmark of Leidos Business Development momentum—quantity and quality of aw
Slide 5: Q3 FY21 Results: Income Statement
Q3 FY21 Results: Income Statement Revenues (M) Adjusted EBITDA Margin (%) Non-GAAP Diluted EPS ($) 11.6% $1.80 $3,483 10.7% $3,242 +7% total +90 bps +22% +6% organic $1.47 $3,436 Q3 FY20 Q3 FY21 Q3 FY20 Q3 FY21 Q3 FY20 Q3 FY21 Note: Shaded upper portion on Q3 FY21 Revenues represents acquired revenu
Slide 6: Q3 FY21 Results: Reporting Segments
Q3 FY21 Results: Reporting Segments Defense Solutions Civil Health $771 $792 Revenues (M) $1,951 $2,009 $682 +3% total +3% total $520 +31% total +1% organic $1,962 Non-GAAP Op Margin (%) Q3 FY20 Q3 FY21 Q3 FY20 Q3 FY21 Q3 FY20 Q3 FY21 8.8% 8.8% 10.5% 20.7% unchanged 9.6% 16.3% +440 bps -90 bps Note:
Slide 7: Q3 FY21 Results: Cash Flow / Balance Sheet
Q3 FY21 Results: Cash Flow / Balance Sheet Exceptional cash generation—operational excellence, advance payments Cash Flow ▪ Operating cash flow $565M Generation ▪ Free cash flow $541M ▪ Cash tax headwind from last year’s CARES Act deferral $(62)M Following balanced long-term approach to capital depl
Slide 8: 2021 Guidance
2021 Guidance Current Prior FY21 Guidance Measure Current Prior Revenues (billions) $13.7 - $13.9 $13.7 - $14.1 Adjusted EBITDA Margin 10.9% - 11.1% 10.5% - 10.7% Non-GAAP Diluted EPS $6.55 - $6.75 $6.35 - $6.65 Cash Flows Provided by Operating Activities (millions) at or above $875 at or above $875
Slide 9: 2021 Guidance Assumptions
2021 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 10: Appendix: Non-GAAP Reconciliations
Appendix: Non-GAAP Reconciliations
Slide 11: Organic Growth
Organic Growth Percent (in millions, except growth rates) Q3 FY21 Q3 FY20 Change Defense Solutions Revenues, as reported $ 2,009 $ 1,951 3% Acquisition revenues 47 — Pro-forma revenues (Organic Growth Rate) $ 1,962 $ 1,951 1% Civil Revenues, as reported $ 792 $ 771 3% Health Revenues, as reported $
Slide 12: Non-GAAP Income Metrics Reconciliation
Non-GAAP Income Metrics Reconciliation Three Months Ended October 1, 2021 Three Months Ended October 2, 2020 Acquisition, Acquisition, Amortization integration and Amortization Asset integration and Amortization of equity restructuring of acquired impairment Non-GAAP restructuring of acquired method
Slide 13: Segment Non-GAAP Income Metrics Reconciliation
Segment Non-GAAP Income Metrics Reconciliation Three Months Ended October 1, 2021 Acquisition, integration and Amortization of Non-GAAP Non-GAAP Operating restructuring acquired operating operating (in millions) income (loss) costs intangibles income (loss) margin(1) Defense Solutions $ 140 $ — $ 36
Slide 14: Free Cash Flow
Free Cash Flow Three Months Ended (in millions, except conversion ratio) 2021 2020 Net cash provided by operating activities $ 565 $ 592 Payments for property, equipment and software (24) (30) Free cash flow $ 541 $ 562 Net income attributable to Leidos common stockholders $ 205 $ 163 Acquisition, i