WASHINGTON (dpa-AFX) - Government contractor SAIC, Inc. (SAI) said Wednesday after the markets closed that its second quarter profit fell from last year, as revenue declined amid a challenging government contracting environment. The company's quarterly earnings per share also came in below analysts' expectations. At the same time, the company cut its full year revenue and earnings outlook.
The McLean, Virginia-based company reported net income for the second quarter of $178 million or $0.50 per share, compared to $190 million or $0.50 per share for the year-ago quarter.
Income from continuing operations for the second quarter was $112 million or $0.32 per share, compared to $157 million or $0.42 per share in the prior year quarter.
On average, 15 analysts polled by Thomson Reuters expected the company to earn $0.35 per share for the second quarter.
Operating income for the quarter fell 23% to $209 million from $272 million in the second quarter of last year, which included a $56 million royalty payment receipt.
During the quarter, the company completed the sale of its operations focused on providing IT services to oil and gas companies to India's Wipro Ltd. .The $109 million pre-tax gain on the sale contributed to income from discontinued operations, net of tax of $66 million, or $.18 per share.
The company, which provides engineering and technical services to the U.S. Defense and Homeland Security departments, said revenues for the second quarter fell 6% to $2.60 billion from $2.75 billion in the same quarter last year. Fifteen analysts had a consensus revenue estimate of $2.77 billion for the second quarter.
For the second quarter, revenues for the company's Defense Solutions segment dropped 6% to $1.1 billion, while revenue for its Intelligence and Cybersecurity Solutions segment fell 1% to $843 million and Health, Energy and Civil Solutions segment revenues declined 2% to $667 million.
Net business bookings in the second quarter were $2.3 billion, representing a book-to-bill ratio of 0.9, the company said.
'Our overall results for the quarter were disappointing,' said Walt Havenstein, SAIC chief executive officer. 'In this challenging government contracting environment, the lack of funding for ongoing programs and for ramping up new work drove a shortfall in revenues and earnings per share.'
During the second quarter, the company repurchased about 10.2 million shares of its common stock for $171 million, and ended the quarter with cash and cash equivalents of $1.34 billion.
The company lowered its fiscal year 2012 outlook, saying it now expects revenue of $10.6 billion to $11.0 billion and earnings from continuing operations of $1.30 to $1.40 per share. Previously, the company expected revenue of $11.0 billion to $11.5 billion and earnings from continuing operations of $1.35 to $1.46 per share.
Analysts currently expect the company to earn $1.43 per share on revenue of $11.20 billion for the fiscal year 2012.
SAIC shares, which have traded in a range of $13.51 to $17.65 over the past year, closed Monday's regular trading session at $15.00, up 17 cents or 1.15%. The stock is currently losing 80 cents or 5.33% in after hours trading.
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