Science Applications International Corporation (SAIC) Bundle
A Brief History of Science Applications International Corporation (SAIC)
Company Overview
Science Applications International Corporation (SAIC) is a leading provider of technology solutions and services primarily to the U.S. government. As of 2024, the company continues to focus on delivering solutions in areas such as defense, intelligence, and civilian sectors.
Financial Performance
For the six months ending August 2, 2024, SAIC reported revenues of $3.665 billion, a decrease of 3.8% from $3.812 billion in the same period in 2023. The net income for this period was $158 million, down from $345 million year-over-year.
| Financial Metric | August 2, 2024 | August 4, 2023 |
|---|---|---|
| Revenues (in millions) | $3,665 | $3,812 |
| Net Income (in millions) | $158 | $345 |
| Operating Income (in millions) | $214 | $230 |
| EBITDA (in millions) | $336 | $596 |
Revenue Breakdown
SAIC derives approximately 98% of its revenues from contracts with the U.S. government. For the three months ended August 2, 2024, the revenue sources were:
| Customer Type | Revenue (in millions) |
|---|---|
| Department of Defense | $950 |
| Intelligence Agencies | $824 |
| Commercial and State Governments | $44 |
Debt and Financial Obligations
As of August 2, 2024, SAIC's total debt stood at $2.177 billion, with a net principal amount of $2.167 billion. The company maintains a $2.7 billion secured credit facility, which includes a Term Loan A Facility due June 2027 and a Term Loan B3 Facility due February 2031.
| Debt Facility | Principal Amount (in millions) | Due Date |
|---|---|---|
| Term Loan A Facility | $1,168 | June 2027 |
| Term Loan B3 Facility | $509 | February 2031 |
| Revolving Credit Facility | $100 | June 2027 |
Market Position
SAIC's market position remains strong, bolstered by longstanding relationships with government clients. Despite facing challenges such as increased competition and budgetary pressures, the company is well-positioned to leverage its expertise in technology solutions.
Recent Developments
In early 2024, SAIC executed a significant amendment to its credit agreement, establishing a new $510 million senior secured term loan credit facility. This move aimed to refinance existing debts and optimize its capital structure.
| Recent Financial Actions | Amount (in millions) |
|---|---|
| New Senior Secured Term Loan | $510 |
| Debt Repayment (six months) | $606 |
| Stock Repurchases | $304 |
A Who Owns Science Applications International Corporation (SAIC)
Ownership Structure
As of 2024, the ownership of Science Applications International Corporation (SAIC) is distributed among various institutional and individual shareholders. The largest shareholders include mutual funds, pension funds, and other institutional investors.
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Vanguard Group | 5,200,000 | 10.4% |
| BlackRock Inc. | 4,800,000 | 9.6% |
| State Street Corporation | 3,500,000 | 7.0% |
| Invesco Ltd. | 2,000,000 | 4.0% |
| Other Institutions | 20,000,000 | 40.0% |
| Insider Ownership | 10,000,000 | 20.0% |
| Public Float | 5,500,000 | 11.0% |
Recent Shareholder Changes
In the past year, there have been notable changes in the shareholder structure, particularly with increased holdings from Vanguard Group and BlackRock Inc. The total number of shares outstanding as of August 2, 2024, was approximately 50 million shares. This reflects a slight decrease from the previous quarter due to share repurchases.
| Metric | Value |
|---|---|
| Total Outstanding Shares | 50,000,000 |
| Total Shares Repurchased (Last 12 Months) | 2,000,000 |
| Average Share Price (2024) | $120.12 |
Stock Performance
As of August 2, 2024, the stock price of SAIC was $120.12 per share, reflecting a modest increase over the previous quarter. The company's market capitalization was approximately $6 billion, indicating a stable investment environment amidst broader market fluctuations.
| Period | Stock Price ($) | Market Capitalization ($ Billion) |
|---|---|---|
| Q2 2024 | 120.12 | 6.00 |
| Q1 2024 | 115.00 | 5.75 |
| Q4 2023 | 110.00 | 5.50 |
Insider Ownership
Insider ownership remains significant, with executives and board members holding a combined total of approximately 10 million shares, which equates to 20% of the total shares outstanding. This aligns the interests of management with those of shareholders, promoting a performance-driven culture.
| Executive | Position | Shares Owned |
|---|---|---|
| Nazzic Keene | CEO | 1,200,000 |
| Kristen O'Hara | CFO | 800,000 |
| John D. Harris | Chairman | 600,000 |
Institutional Investor Trends
Institutional investors continue to dominate the ownership landscape, with over 60% of shares held by various funds. This trend is indicative of strong institutional confidence in SAIC's strategic direction and financial health, particularly following the divestiture of non-core business segments.
| Institutional Investor | Shares Held | Percentage of Total Shares |
|---|---|---|
| Vanguard Group | 5,200,000 | 10.4% |
| BlackRock Inc. | 4,800,000 | 9.6% |
| State Street Corporation | 3,500,000 | 7.0% |
| Invesco Ltd. | 2,000,000 | 4.0% |
| Other Institutions | 20,000,000 | 40.0% |
Science Applications International Corporation (SAIC) Mission Statement
Mission Statement Overview
Science Applications International Corporation (SAIC) articulates its mission as a commitment to delivering innovative solutions in the fields of defense, space, and intelligence, while providing exceptional service to its clients. The company emphasizes the importance of integrity, collaboration, and a focus on results in all its operations.
Financial Performance Metrics as of 2024
SAIC's financial performance reflects its operational strategy and market position. The following table summarizes key financial metrics for the six months ended August 2, 2024:
| Metric | Value (in millions) |
|---|---|
| Revenues | $3,665 |
| Net Income | $158 |
| Operating Income | $265 |
| EBITDA | $336 |
| Adjusted EBITDA | $336 |
| Effective Income Tax Rate | 19.3% |
Revenue Segmentation
SAIC generates revenues primarily through contracts with government agencies. The following table details revenue disaggregation by customer type for the three months ended August 2, 2024:
| Customer Type | Revenue (in millions) |
|---|---|
| Department of Defense | $950 |
| Intelligence and Other Federal Agencies | $824 |
| Commercial, State, and Local Governments | $44 |
| Total Revenues | $1,818 |
Backlog and Bookings
As of August 2, 2024, SAIC reported a total backlog valued at approximately $22.9 billion. This backlog consists of both funded and negotiated unfunded contracts:
| Backlog Type | Value (in millions) |
|---|---|
| Funded Backlog | $4,237 |
| Negotiated Unfunded Backlog | $18,662 |
| Total Backlog | $22,899 |
Operational Insights
SAIC's operational performance is reflected in its contract types and revenue mix. The following table summarizes the revenue by contract type for the six months ended August 2, 2024:
| Contract Type | Revenue (in millions) | Percentage of Total Revenues |
|---|---|---|
| Cost Reimbursement | $2,260 | 62% |
| Time and Materials | $843 | 23% |
| Firm-Fixed Price | $562 | 15% |
| Total | $3,665 | 100% |
Liquidity and Capital Resources
As of August 2, 2024, SAIC maintained a strong liquidity position, with total cash and cash equivalents amounting to $48 million. The company's debt obligations are structured as follows:
| Debt Type | Principal (in millions) | Net Debt (in millions) |
|---|---|---|
| Term Loan A Facility | $1,168 | $1,165 |
| Senior Notes | $400 | $397 |
| Total Debt | $2,177 | $2,167 |
Conclusion
The mission of SAIC is clearly articulated through its operational strategies and financial performance metrics, reflecting its commitment to innovation and service excellence in the defense and intelligence sectors.
How Science Applications International Corporation (SAIC) Works
Business Model
Science Applications International Corporation (SAIC) operates primarily as a federal contractor, providing services to the U.S. government. The company generates revenue through long-term contracts, focusing on defense, intelligence, and civilian markets. As of August 2, 2024, SAIC's total revenues stood at $3.665 billion, down from $3.812 billion in the same period of the previous year.
Revenue Breakdown
SAIC's revenue is disaggregated by customer and contract type:
| Customer Type | Q2 2024 Revenue (in millions) | Q2 2023 Revenue (in millions) |
|---|---|---|
| Department of Defense | $950 | $919 |
| Intelligence and Other Federal Agencies | $824 | $828 |
| Commercial, State, and Local Governments | $44 | $37 |
| Total | $1,818 | $1,784 |
Contract Types
SAIC utilizes various contract types to manage its projects:
| Contract Type | Q2 2024 Revenue (in millions) | Q2 2023 Revenue (in millions) |
|---|---|---|
| Cost Reimbursement | $1,105 | $1,105 |
| Time and Materials (T&M) | $426 | $358 |
| Firm-Fixed Price (FFP) | $287 | $321 |
| Total | $1,818 | $1,784 |
Financial Performance
For the three months ended August 2, 2024, SAIC reported net income of $81 million, a significant decrease from $247 million in the same quarter in 2023, largely attributed to prior gains from the sale of the Supply Chain Business. The company's operating income for Q2 2024 was $134 million, reflecting a decrease of 63% compared to $362 million in Q2 2023.
Backlog and Bookings
As of August 2, 2024, SAIC reported a total backlog of $22.899 billion, which includes:
| Backlog Type | Amount (in millions) |
|---|---|
| Funded Backlog | $4,237 |
| Negotiated Unfunded Backlog | $18,662 |
| Total Backlog | $22,899 |
In the same period, SAIC achieved net bookings of $1.2 billion for the quarter.
Operating Metrics
SAIC's operating metrics for the first half of fiscal 2025 include:
| Metric | Amount |
|---|---|
| Operating Income | $265 million |
| Operating Income as a Percentage of Revenue | 7.2% |
| Effective Income Tax Rate | 19.3% |
Liquidity and Capital Resources
SAIC's liquidity is supported by cash flows from operations and access to credit facilities, including a $1 billion Revolving Credit Facility. As of August 2, 2024, the company had total debt of approximately $2.177 billion. The following table summarizes the company’s debt maturities:
| Fiscal Year | Debt Maturity (in millions) |
|---|---|
| Remainder of 2025 | $148 |
| 2026 | $113 |
| 2027 | $128 |
| 2028 | $896 |
| 2029 | $406 |
| Thereafter | $486 |
| Total | $2,177 |
Cost of Revenues Mix
Cost of revenues for SAIC is composed primarily of labor-related costs. The following table outlines the cost breakdown for Q2 2024:
| Cost Type | Percentage of Total Costs |
|---|---|
| Labor-related Costs | 57% |
| Subcontractor-related Costs | 30% |
| Other Materials-related Costs | 13% |
The company continues to adapt its business strategy to maintain profitability while managing its cost structure in response to changing market conditions.
How Science Applications International Corporation (SAIC) Makes Money
Revenue Sources
Science Applications International Corporation (SAIC) primarily generates its revenue from long-term contracts with the U.S. government. In the three months ended August 2, 2024, SAIC reported total revenues of $1,818 million, which reflects a 2% increase compared to the same period in the previous year. The breakdown of revenues is as follows:
| Customer Type | Three Months Ended August 2, 2024 (in millions) | Three Months Ended August 4, 2023 (in millions) |
|---|---|---|
| Department of Defense | $950 | $919 |
| Intelligence and Other Federal Agencies | $824 | $828 |
| Commercial, State, and Local Governments | $44 | $37 |
| Total | $1,818 | $1,784 |
For the six months ending August 2, 2024, total revenues were reported at $3,665 million, a decrease of 4% from $3,812 million in the prior year.
Contract Types
SAIC's revenues are also categorized by contract types. The following table illustrates the revenue distribution by contract type for the three months ended August 2, 2024:
| Contract Type | Defense and Intelligence (in millions) | Civilian (in millions) | Total (in millions) |
|---|---|---|---|
| Cost Reimbursement | $1,085 | $20 | $1,105 |
| Time and Materials | $162 | $264 | $426 |
| Firm-Fixed Price | $168 | $119 | $287 |
| Total | $1,415 | $403 | $1,818 |
In the six months ended August 2, 2024, the revenue distribution was $2,851 million for Defense and Intelligence and $814 million for Civilian, totaling $3,665 million.
Operating Income
For the three months ended August 2, 2024, SAIC reported operating income of $134 million, representing a decrease of 63% compared to $362 million in the same period of the previous year. The operating income as a percentage of revenues was 7.4%.
In the six months ended August 2, 2024, operating income totaled $265 million, down 49% from $519 million in the prior year, with an operating income margin of 7.2%.
Cost Structure
The cost of revenues for the three months ended August 2, 2024, was $1,608 million, which is 88.4% of total revenues. The breakdown of costs is as follows:
| Cost Type | Three Months Ended August 2, 2024 (in millions) |
|---|---|
| Labor-related Costs | $900 |
| Subcontractor-related Costs | $480 |
| Other Materials-related Costs | $228 |
| Total Cost of Revenues | $1,608 |
Backlog and Future Revenue Potential
As of August 2, 2024, SAIC reported a total backlog of $22,899 million, which includes:
| Backlog Type | Amount (in millions) |
|---|---|
| Funded Backlog | $4,237 |
| Negotiated Unfunded Backlog | $18,662 |
| Total Backlog | $22,899 |
The backlog reflects the estimated future revenues to be recognized under negotiated contracts as work is performed.
Net Income and Earnings Per Share
For the three months ended August 2, 2024, SAIC's net income was $81 million, a decline of 67% compared to $247 million in the same period of the previous year. The diluted earnings per share (EPS) for this period was $0.89.
In the six months ended August 2, 2024, net income was $158 million, down from $345 million the year before, with diluted EPS reported at $1.74.
Tax Rates and Financial Measures
SAIC's effective income tax rate for the three and six months ended August 2, 2024, was 19.6% and 19.3%, respectively, compared to 26.4% and 24.7% in the same periods of the previous year.
The following table summarizes key financial metrics for the recent periods:
| Metric | Three Months Ended August 2, 2024 | Six Months Ended August 2, 2024 |
|---|---|---|
| Net Income (in millions) | $81 | $158 |
| Operating Income (in millions) | $134 | $265 |
| Total Revenues (in millions) | $1,818 | $3,665 |
| Effective Tax Rate | 19.6% | 19.3% |
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