Defense Stocks News - SAIC, Inc. (NYSE: SAI ) Announces Financial Results for First Quarter of Fiscal Year 2010; Operating Income: Up 17 percent

Defense Stocks News - SAIC, Inc. (NYSE: SAI ) Announces Financial Results for First Quarter of Fiscal Year 2010; Operating Income: Up 17 percent to $204 million

- Diluted EPS from Continuing Operations: Up 16 percent to $0.29

- Reaffirming Guidance for Fiscal Year 2010

SAN DIEGO and MCLEAN, Va., June 3 -- SAIC, Inc. (NYSE: SAI ), a scientific, engineering, and technology applications company, today announced financial results for the first quarter of fiscal year 2010, which ended April 30, 2009.

After the quarter ended, the U.S. Department of Defense indicated that it intends to restructure the Future Combat Systems (FCS) program, which represents about 3 percent of the company's annual revenue. The company currently expects to have a significant role under the restructured program, but the level of effort and terms and conditions remain under negotiation.

"In the first quarter of fiscal year 2010, we continued to demonstrate a pattern of solid program execution and financial performance," said Ken Dahlberg, SAIC chairman and chief executive officer. "I am especially pleased that the results were so uniformly positive. That is, all of our major metrics -- revenue, operating margin, earnings per share, and cash flow -- were robust, and virtually all of our business units met or exceeded our expectations. Although the potential restructuring of FCS provides some uncertainty, based on our strong market position across our wide business base, we expect fiscal year 2010 to be another solid year for the company."

Summary Operating Results

Revenues for the quarter were $2.65 billion, up 12 percent from $2.37 billion in the first quarter of fiscal year 2009. Internal, or non-acquisition, growth represented 11 percentage points of the consolidated growth for the quarter. Key drivers of internal growth included the initial ramp of recent wins in defense logistics, information technology, cyber-security, and intelligence support as well as increased tasking on existing defense and intelligence programs.

Operating income for the quarter was $204 million (7.7 percent of revenue), up 17 percent from $174 million (7.4 percent of revenue) in the first quarter of fiscal year 2009. Growth in quarterly operating margin percentage was driven by continued improvements in cost efficiency and contract fees. Income from continuing operations for the quarter was $117 million, up 11 percent from $105 million in the first quarter of fiscal year 2009. Income from continuing operations grew more slowly than operating income primarily because of a $7 million reduction in interest income net of interest expense and a $5 million reduction in other income resulting from joint venture activities and a gain on the sale of two venture capital portfolio investments in the year-ago period.

Diluted earnings per share (EPS) from continuing operations for the quarter were $0.29, up 16 percent from $0.25 in the first quarter of fiscal year 2009, driven by the increase in income from continuing operations and a lower share count compared to the prior year quarter. The diluted share count for the quarter was 397 million, down 3 percent from 410 million in the first quarter of fiscal year 2009, due primarily to share repurchases made over the last four quarters. Diluted earnings per share, which include discontinued operations, were $0.28 for the quarter, up 17 percent from $0.24 in the first quarter of fiscal year 2009. Discontinued operations include Telcordia Technologies, Inc., which was sold in the first quarter of fiscal year 2006, and the Applied Marine Technology, Inc. products business, which was sold in the first quarter of fiscal year 2010.

Earnings per share and share count figures quoted for fiscal year 2009 differ from those cited previously because on February 1, 2009, the company adopted Financial Accounting Standards Board (FASB) Staff Position (FSP) No. EITF 03-6-1 "Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities," which requires retrospective application to prior periods. Upon adoption, basic EPS from continuing operations, basic EPS, diluted EPS from discontinued operations and diluted EPS for the three months ended April 30, 2008 each decreased by $0.01. The new methodology had a similarly dilutive effect for the three months ended April 30, 2009.

Cash Generation and Capital Deployment

Cash flow from operations for the quarter was $163 million (or 1.4 times income from continuing operations) compared to $14 million in the first quarter of fiscal year 2009. Cash collections continued to be strong as days sales outstanding (DSO) were 68 days, flat sequentially and an improvement of five days year-over-year.

During the quarter, the company used $223 million to repurchase approximately 12 million common shares including 11 million under the company's stock repurchase program and the remainder in recurring repurchases from employees in settlement of withholding taxes associated with stock option exercises and vesting events. Whether any future repurchases are made and the timing and actual number of shares repurchased under the stock repurchase program will depend on a variety of factors, including share price, corporate capital requirements, and other market conditions. As of April 30, 2009, the company had $898 million in cash and cash equivalents and $1.1 billion in long-term debt.

New Business Awards

Net new business bookings totaled $2.6 billion in the first quarter, representing a book-to-bill ratio of 1.0. Net bookings are calculated as the current period ending backlog plus the current period's revenue less prior period ending backlog and backlog obtained in acquisitions. No bookings value is assigned unless the company has received a signed contract for a priced statement of work.

Large, competitive definite delivery contract awards received during the quarter include:

Armed Forces Health Longitudinal Technology Application/Composite Health Care System (AHLTA/CHCS) Support. Under a 30-month, $158 million task order, SAIC will provide engineering, logistics and sustainment support to AHLTA/CHCS to ensure the quality care of 9.4 million beneficiaries at more than 135 Military Treatment Facilities worldwide. Together, the AHLTA electronic health record and the CHCS integrated hospital information system enable the Military Health System to track clinical care and exposures of deployed units, monitor demand-management effectiveness, better understand disease prevalence and prevention, and study both clinical and management outcomes.

Tactical Biometrics Systems (TBS) Support. SAIC was awarded a subcontract by Sensor Technologies Incorporated to support the U.S. Army Communications and Electronics Command by providing operations and user maintenance support to TBS. SAIC's subcontract has a four-year period of performance and a total contract value of more than $115 million. TBS devices collect fingerprints, iris scans, facial photos and biographical information on persons of interest. The biometric data is then matched against a database, potentially identifying wanted or dangerous persons. SAIC will provide operations and user maintenance support to help ensure continued, reliable technical support of TBS systems, peripherals and networks.

Center for Domestic Preparedness (CDP) Support. SAIC received a five-year, $104 million contract from the Department of Homeland Security to provide training support to the CDP. CDP offers all-hazards training at the only federally chartered weapons of mass destruction training center, catering to emergency responders from all 50 states, the District of Columbia, and the U.S. territories. SAIC will design and develop emergency responder curriculum, provide qualified instructors to teach each course, and manage training logistics and sustainment activities.

U.S. Joint Forces Command (USJFCOM) Joint Capability Development Directorate (J8) Support. Under a five-year, $81 million task order, SAIC will support USJFCOM J8 in the areas of engineering, analysis, test, and evaluation. SAIC will perform work in the areas of command and control, capability engineering, system engineering and integration, capability portfolio management, and net-enabled command capability to help address the complex challenges associated with joint capability development.

Hawaii Energy Efficiency Program Administration. SAIC was awarded a contract to administer the rate-payer funded Hawaii Energy Efficiency Program, helping Hawaiian residents and businesses become more energy efficient. The contract potentially runs through 2016; the contract has a value of $38 million for the first two years. SAIC will provide program design and implementation, customer incentives and rebates, new initiatives, interface with the Hawaii Clean Energy Initiative, and manage efforts concerning commercial, industrial, residential, and renewable energy programs.

In addition, SAIC also won several indefinite delivery/indefinite quantity (IDIQ) contracts that are not included in net bookings. The most notable IDIQ awards during the quarter were:

General Services Administration (GSA) Alliant. SAIC was awarded a prime contract on the Alliant government-wide acquisition contract from the GSA. Alliant is a multiple-award contract with a 10-year period of performance and a total ceiling value for all awardees of $50 billion. The scope of work includes all components of an integrated information technology solution, including future technologies that may emerge during the life of the contract.

Simulation and Training Omnibus Contract (STOC II). SAIC will provide simulation, training and instrumentation services and products under STOC II, which was awarded by the U.S. Army's Program Executive Office for Simulation Training and Instrumentation (PEO STRI). This ten-year, multiple-award contract has a total ceiling value of $17.5 billion for all awardees. SAIC will perform a full range of life cycle management to include front end analysis, design, development, fielding, and sustainment of training and testing systems, instrumentation, and gaming system simulators.

U.S. Strategic Command (USSTRATCOM) Support Services. SAIC received a contract to provide technical analysis and studies for programs and strategies for USSTRATCOM. This multiple-award contract has a five-year period of performance and a ceiling value of $900 million for all awardees. USSTRATCOM's missions include Space Operations; Cyberspace Operations; Strategic Deterrence; Combating Weapons of Mass Destruction; Global Command and Control; Global Strike and Integration; Information Operations; Integrated Missile Defense; and Intelligence, Surveillance and Reconnaissance.

The company's backlog of signed business orders at the end of the first quarter of fiscal year 2010 was $16.7 billion, of which $5.7 billion was funded. As compared to the end of the first quarter of fiscal year 2009, total backlog increased 11 percent and funded backlog increased 6 percent. The negotiated unfunded backlog of $11.0 billion represents the estimated amount to be earned in the future from firm orders for which funding has not been appropriated or otherwise authorized and unexercised priced contract options. Negotiated unfunded backlog does not include any estimate of future expected task orders to be awarded under IDIQ or other master agreement contract vehicles.

Included within the backlog is approximately $0.1 billion in funded backlog and $1.0 billion in negotiated unfunded backlog related to FCS through the current contract end date of December 31, 2014. The company expects that it will soon stop work on the manned ground vehicle component of FCS but continue work on the system-of-systems integration component and the new technology spin-outs under a new or modified contract. The company expects that approximately $0.2 billion of the FCS backlog will be recognized as revenues throughout the remainder of fiscal 2010.

Forward Guidance

Despite the FCS developments, SAIC maintains a healthy backlog and a strong market position across its wide business base. Absent further disruptions in government funding, the company currently expects to achieve all of its long-term, average annual financial goals in fiscal year 2010:

Growing revenue internally in the six percent to nine percent range;Improving operating margin by 20 to 30 basis points until reaching a sustainable level between eight percent and nine percent; and Growing earnings per share from 11 percent to 18 percent.

Mark Sopp, SAIC chief financial officer commented, "The company has built a resilient and diversified base of business and new opportunities that enables us to reaffirm our expectation that we will achieve our long-term financial growth goals again in fiscal year 2010 despite the restructuring of FCS. The strength of this company lies not with one contract, but with thousands of contracts and 45,000 employees dedicated to solving our customers' most difficult problems."

About SAIC

SAIC is a FORTUNE 500® scientific, engineering, and technology applications company that uses its deep domain knowledge to solve problems of vital importance to the nation and the world, in national security, energy and the environment, critical infrastructure, and health. The company's approximately 45,000 employees serve customers in the U.S. Department of Defense, the intelligence community, the U.S. Department of Homeland Security, other U.S. Government civil agencies and selected commercial markets. SAIC had annual revenues of $10.1 billion for its fiscal year ended January 31, 2009. For more information, visit www.saic.com.

SAIC: From Science to Solutions®

Forward-Looking Statements

Certain statements in this release contain or are based on "forward-looking" information within the meaning of the Private Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by words such as "expects," "intends," "plans," "anticipates," "believes," "estimates," "guidance" and similar words or phrases. Forward-looking statements in this release include, among others, estimates of future revenues, earnings, backlog, outstanding shares and cash flows. These statements reflect our belief and assumptions as to future events that may not prove to be accurate. Actual performance and results may differ materially from the guidance and other forward-looking statements made in this release depending on a variety of factors, including: changes in the U.S. Government defense budget or budgetary priorities or delays in the U.S. budget process; changes in U.S. Government procurement rules and regulations; our compliance with various U.S. Government and other government procurement rules and regulations; the outcome of U.S. Government reviews, audits and investigations of our company; our ability to win contracts with the U.S. Government and others; our ability to attract, train and retain skilled employees; our ability to maintain relationships with prime contractors, subcontractors and joint venture partners; our ability to obtain required security clearances for our employees; our ability to accurately estimate costs associated with our firm-fixed-price and other contracts; resolution of legal and other disputes with our customers and others; our ability to successfully acquire and integrate businesses; our ability to manage risks associated with our international business; our ability to compete with others in the markets in which we operate; and our ability to execute our business plan effectively and to overcome these and other known and unknown risks that we face. These are only some of the factors that may affect the forward-looking statements contained in this release. For further information concerning risks and uncertainties associated with our business, please refer to the filings we make from time to time with the SEC, including the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Legal Proceedings" sections of our latest annual report on Form 10-K and quarterly report on Form 10-Q, which may be viewed or obtained through the Investor Relations section of our Web site at www.saic.com.

All information in this release is as of June 3, 2009. SAIC expressly disclaims any duty to update the guidance or any other forward-looking statement provided in this release to reflect subsequent events, actual results or changes in the company's expectations. SAIC also disclaims any duty to comment upon or correct information that may be contained in reports published by investment analysts or others.

CONTACTS: Investor Relations: Stuart Davis 703-676-2283 stuart.davis@saic.com

Media Relations: Laura Luke Melissa Koskovich 703-676-6533 703-676-6762 laura.luke@saic.com


melissa.l.koskovich@saic.com



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Northrop Grumman Opens New Facility for Ministry of Defence Gyrocompass Technical Support in New Malden, U.K.

Northrop Grumman Opens New Facility for Ministry of Defence Gyrocompass Technical Support in New Malden, U.K.

LONDON, June 1, 2009 -- Northrop Grumman Corporation (NYSE:NOC) today officially opened its new U.K. technical support centre to provide service, repair and maintenance for the company's inertial navigation systems (INS) used in Royal Navy ships and submarines.
The new naval gyrocompass support centre, located at Northrop Grumman's Sperry Marine facility in New Malden, U.K., contains a full repair and calibration workshop to support NATO ship INS (SINS) installed on Royal Navy surface warships and attack submarines. Sperry Marine is under contract with the U.K. Ministry of Defence (MoD) to provide ongoing in-service support for these systems.

The event was attended by Northrop Grumman executives, as well as MoD officials and local political leaders. They received a tour of the facility as well as briefings on and demonstrations of its capabilities.
"This new facility will significantly enhance Northrop Grumman's U.K.-based technical capabilities and marks a major milestone in our continuing programme of improving the support we provide to our MoD customers," said Sir Nigel Essenhigh, chairman of Northrop Grumman U.K. "The gyro support centre in New Malden will enable us to provide faster turnaround times and more responsive service support for these important mission-critical shipboard components."

"The new workshop will enable our U.K. employees to perform repairs and re-calibration services for the sophisticated inertial measurement units, which are at the heart of these military shipboard systems," said J. Nolasco DaCunha, vice president of Northrop Grumman Sperry Marine. "Today's opening represents the culmination of many months of work to install the workshop facilities and establish the security systems required by the U.K. MoD."
Northrop Grumman Sperry Marine's offices in New Malden are responsible for a number of major MoD programmes, including the integrated platform management systems being fitted on the Type 45 destroyers and the new Astute-class submarines, as well as the integrated navigation and bridge system being developed for the next generation of Royal Navy aircraft carriers. In addition, the New Malden facility is Sperry Marine's primary centre of excellence for navigation radar and electronic charting technology for commercial marine and international defence markets.


"The gyro support centre is part of a major investment we are making in our New Malden facility," said Dhanvant Goradia, director of Sperry Marine's New Malden business unit. "We are currently nearing the completion of a large-scale modernisation programme for our Burlington House office, which will make the building more attractive and energy efficient as we continue to play an important role in the local economy as a major employer."
Based on Sperry Marine's proprietary ring-laser gyro technology, the SINS devices provide extremely precise 3-D position and attitude reference data for the vessels' navigation and weapons systems. Sperry Marine is a world leader in ring-laser gyro inertial navigation technology, having supplied the vast majority of SINS shipboard devices currently deployed with NATO and international naval forces around the world.
Northrop Grumman Sperry Marine, headquartered in Charlottesville, Va., and with major engineering and support offices in New Malden, United Kingdom and Hamburg, Germany, provides smart navigation and ship control solutions for the international marine industry with customer service and support through offices in 16 countries, sales representatives in 47 countries and authorized service depots in more than 250 locations worldwide.
Northrop Grumman in the U.K. operates from primary locations in London, Fareham, Chester, Coventry, New Malden, Peterborough, RAF Waddington and Solihull and provides avionics, communications, electronic warfare systems, marine navigation systems, robotics, C4ISR solutions and mission planning, IT systems and software development, aircraft maintenance and airport security solutions.

Northrop Grumman Corporation is a leading global security company whose 120,000 employees provide innovative systems, products, and solutions in aerospace, electronics, information systems, shipbuilding and technical services to government and commercial customers worldwide.


CONTACT: Ken Beedle Northrop Grumman Corporation (London) +44 207 747 1910 +44 7787 174092 ken.beedle@euro.ngc.com
Tom Delaney Northrop Grumman Electronic Systems +1 (410) 993-6454 thomas.delaney@ngc.comResearch defense stocks with the global defense stocks directory at Investorideas.com
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Defense Stocks Directory Update; Addition of Ishikawa Seisakusho, Ltd.

Defense Stocks Directory Update; Addition of Ishikawa Seisakusho, Ltd.

POINT ROBERTS, Wash., DELTA, B.C. – May 27, 2009 – www.HomelandDefenseStocks.com, a leading global investor and industry portal for the defense and security sector, within Investorideas.com, adds new defense stocks to the global stock directory. The directory provides investors with research global in defense stocks, Homeland Security Stocks, Aerospace and Defense Stocks, Biodefense Stocks, Security Stocks, Energy Security Stocks and Infrastructure Stocks. The directory includes stocks on NYSE, NASDAQ, OTCBB, TSX and global exchanges.

Homeland Security and Defense Stocks Directory:
Today’s Additions:

Ishikawa Seisakusho, Ltd. (TYO:6208) is a Japan-based manufacturing company. The Defense Equipment and Industrial Machinery division is engaged in the manufacture and sale of mines, corrugated board container printing machines, electronic components manufacturing equipment and silent sound bone mass measuring devices. Additionally, through its subsidiaries, the Company is engaged in the manufacture of components for its machinery and equipment.

Aria International Incorporated (OTCBB:ARAH) is a wholly-owned subsidiary of Aria International Holdings, Inc. and is focused on providing specialized surveillance and communications solutions to a global customer base. Aria International operates as a solutions provider, systems integrator, and operator of surveillance and communications systems. Working closely with our clients in a flexible and responsive manner, we are able to provide highly effective solutions that respond well to our customers' defense and security requirements.

Showcase Defense Company:
Optex Systems Holdings, Inc., (OTCBB: OPXS) through its wholly-owned subsidiary, Optex Systems, Inc. manufactures optical sighting systems and assemblies primarily for Department of Defense (DOD) applications. Its products are installed on a majority of types of U.S. military land vehicles, such as the Abrams and Bradley fighting vehicles, Light Armored and Armored Security Vehicles and have been selected for installation on the Future Combat Systems (FCS) Stryker vehicle. Optex also manufactures and delivers numerous periscope configurations, rifle and surveillance sights and night vision optical assemblies. Optex delivers its products both directly to the military services and to prime contractors.

Read the full company profile:
Visit Optex Systems Holdings, Inc. (OTCBB: OPXS) Company Profile: http://www.investorideas.com/CO/OPTEX/

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