Science Applications International Corporation · NASDAQ:SAIC
Science Applications International — Q3 2023 Earnings Presentation
24 slides from Science Applications International's earnings presentation, Dec 5, 2022
Slide 1: Fiscal Year 2023 Third Quarter Earnings Call
Science Applications International Corporation Fiscal Year 2023 Third Quarter Earnings Call Supplemental Financial Presentation December 5, 2022
Slide 2: Bring on Tomorrow
SAIC. BRING ON TOMORROVY, We're not just another company that solves problems. No, we're a company that never stops reaching. Never stops pushing beyond our limits. To rethink engineering in a digital world, we reached. To redefine space training through virtual reality, we reached. To redesign new
Slide 3: Forward Looking Statement
Forward Looking Statement Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “should,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “antici
Slide 4: Today's Presenters
Today’s Presenters Nazzic Keene Prabu Natarajan Chief Executive Officer Chief Financial Officer SAIC PROPRIETARY INFORMATION I © SAIC. ALL RIGHTS RESERVED I 4
Slide 5: SAIC PROPRIETARY INFORMATION I © SAIC. ALL RIGHTS RESERVED
SAIC PROPRIETARY INFORMATION I © SAIC. ALL RIGHTS RESERVED I 5
Slide 6: Joint All Domain Command and Control
Joint All Domain Command and Control SAIC solutions enable missions from global to edge SAIC Objective Differentiators Establish SAIC as a platform agnostic integrator that Digital Engineering transforms the C5ISR architecture to ensure the timely Cloud Modernization and resilient flow of data t
Slide 7: FY2023 Q3 Highlights
FY2023 Q3 Highlights +1% Organic Revenue Increase with Strong On-Contract Growth Q3 Adjusted EBITDA Margin * of 8.9% Increasing FY23 Guidance for Revenue, Adjusted Diluted EPS* Continue to Expect >10% Free Cash Flow* Growth in FY23 and FY24 Q3 Awards of $2.0B Drives Q3 and TTM B2B of 1.1x ~60% of YT
Slide 8: FY2023 Q3 Results
(1) FY2023 Q3 Results ADJUSTED ADJUSTED REVENUE FREE CASH FLOW (2) EBITDA MARGIN (2)(3) DILUTED EPS (2)(4) $1.90B $1.91B 9.0% $1.90 8.9% $1.85 $124M $122M FY2022 FY2023 FY2022 FY2023 FY2022 FY2023 FY2022 FY2023 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 (1) Results of Science Applications International Corporation and
Slide 9: FY2023 YTD Results
(1) FY2023 YTD Results ADJUSTED ADJUSTED REVENUE FREE CASH FLOW (2) EBITDA MARGIN (2)(3) DILUTED EPS (2)(4) $5.74B 9.6% $373M $5.61B 8.9% $5.76 $5.53 $309M FY2022 FY2023 FY2022 FY2023 FY2022 FY2023 FY2022 FY2023 YTD YTD YTD YTD YTD YTD YTD YTD (1) Results of Science Applications International Corpor
Slide 10: SAIC's Enterprise Focus Areas
SAIC’s Enterprise Focus Areas Strategy designed to capture accelerated share across a focused set of market needs • Engineering and integration leader accelerating system development, modernization, and sustainment SAIC MARKET POSITION • Accelerating, securing, and transforming digital environments
Slide 11: Value of Submitted Proposals
Pipeline Increasing, Shifting towards GTA and New Business Pursuits Mix of Submitted Proposals $22 Value of Submitted Proposals ($ in bil.) $20 GTA >40% Core $18 >50% $16 New Business Recompete 100% $14 34% 35% 29% 26% 24% 80% 36% Mix of Submitted Proposals 43% 45% 60% $12 40% 66% 65% 71% 74% 76% 64
Slide 12: Fiscal Year 2023 Guidance
Fiscal Year 2023 Guidance Current Prior New business, extra working days, on-contract, and Revenue ~$7.60B $7.50B - $7.55B acquired revenue growth offset by contract transitions * Adjusted EBITDA % ~8.9% ~8.9% Reflects continued, strong operating performance * Effective tax rate ~ 22% Adjusted
Slide 13: Initial Fiscal Year 2024 Outlook
Initial Fiscal Year 2024 Outlook * * Revenue Adjusted EBITDA % Free Cash Flow $7.60B - $7.80B Approximately 9% Approximately $560M 5 fewer working days in F4Q24 Reflects more favorable mix and benefits from +$50m y/y benefit from payroll tax deferral Expect highest growth rates in F2Q24 and
Slide 14: Illustrative FY23 to FY27 Free Cash Flow Walk
Illustrative FY23 to FY27 Free Cash Flow Walk Increased Earnings / WC* Increased Earnings / WC* Increased Earnings / WC* Lack of Payroll Tax Higher Cash Taxes Higher Cash Taxes Increased Earnings Deferral Payment Taxes & Interest Higher Cash FY25 FCF* FY26 FCF* FY27 FCF* FY23 FCF FY24 FCF >$9 >$10 >
Slide 15: SAIC Cash Tax Attributes
SAIC Cash Tax Attributes Total Annual Cash Tax Benefit $80.0 $70.0 $60.0 $50.0 $40.0 $30.0 $20.0 $10.0 $0.0 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 Cash Tax Benefits* Extended visibility provided by long-duration cash tax assets * - includes NOLs, Intangible Amorti
Slide 16: SAIC Historical Share Repurchase Authorizations
SAIC Historical Share Repurchase Authorizations Incremental Repurchase Avg. Annualized Total Approximate Avg. Shares Avg. Price of Authorization Shares Added Authorization FCF** / Share “Current” Months to Repurchased Repurchased Date to as % of Diluted During Authorization Complete per Month Shares
Slide 17: SAIC Historical Backlog and Book-to-Bill
SAIC Historical Backlog and Book-to-Bill $25 2.2x 0.9x 0.7x 1.2x 1.0x 1.1x 1.1x 2.7x 0.4x $20 Total Backlog ($ in billions) 2.6x 0.9x 1.5x $15 1.2x 1.4x 0.8x 0.9x 1.4x 1.0x 0.8x $10 $5 $0 F1Q19 F2Q19 F3Q19 F4Q19 F1Q20 F2Q20 F3Q20 F4Q20 F1Q21 F2Q21 F3Q21 F4Q21 F1Q22 F2Q22 F3Q22 F4Q22 F1Q23 F2Q23 F3Q2
Slide 18: Appendix
Appendix
Slide 19: Working Days Per Quarter
Working Days Per Quarter Q1 Q2 Q3 Q4 Total FY24 64 62 63 60 249 FY23 64 62 63 65 254 FY22 64 63 63 60 250 FY21 64 63 63 60 250 FY20 64 63 63 60 250 FY19 64 63 63 60 250 SAIC PROPRIETARY INFORMATION I © SAIC. ALL RIGHTS RESERVED I 19
Slide 20: Non-GAAP Reconciliation – EBITDA and Adjusted EBITDA
Non-GAAP Reconciliation – EBITDA and Adjusted EBITDA (1) EBITDA is a performance measure that is calculated by taking net income and excluding interest and loss on sale of receivables, provision for income taxes, and depreciation and amortization. Adjusted EBITDA and adjusted operating income are pe
Slide 21: Non-GAAP Reconciliation – Adjusted Diluted Earnings per Share
Non-GAAP Reconciliation – Adjusted Diluted Earnings per Share (1) Adjusted diluted earnings per share is a performance measure that excludes acquisition and integration costs, impairments, restructuring costs, and any other material non-recurring costs that we do not consider to be indicative of our
Slide 22: Non-GAAP Reconciliation – Free Cash Flow
Non-GAAP Reconciliation – Free Cash Flow (1) “Free cash flow” is a non-GAAP financial measure that is reconciled in this schedule to the most directly comparable GAAP financial measures. This non-GAAP financial measure provides investors with greater visibility into cash flows provided by operating
Slide 23: Non-GAAP Reconciliation – FY23 Free Cash Flow Guidance
Non-GAAP Reconciliation – FY23 Free Cash Flow Guidance (1) “Free cash flow” is a non-GAAP financial measure that is reconciled in this schedule to the most directly comparable GAAP financial measures. This non-GAAP financial measure provides investors with greater visibility into cash flows provided
Slide 24: Bring on Tomorrow
BRING ON TOMORROVYs TAKING THE WORLD WHERE IT’S NEVER BEEN BEFORE. SAIC.
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