COLORADO SPRINGS, Colo.,
Nov. 9, 2021 /PRNewswire/ -- Vectrus, Inc. (NYSE:VEC)
announced third quarter 2021 financial results.
"We reported strong third quarter results that were underpinned
by robust topline growth," said Chuck
Prow, Chief Executive Officer of Vectrus. "In the third
quarter, Vectrus recorded total and organic revenue growth of 30%
and 13%, respectively. During the quarter, the Vectrus team
achieved a noteworthy milestone in support of a major humanitarian
effort. This accomplishment involved the successful build out of
over 250,000 square feet of living space and associated
life-support infrastructure for thousands of refugees coming from
Afghanistan. This work was done on
an accelerated timeline, under extreme weather conditions and
required 24/7 support from our teams to ensure success. I'd like to
commend our team for going above and beyond and their commitment
and dedication to this critically important mission."
Prow continued, "As it relates to LOGCAP V, CENTCOM is at full
operational capability and our presence in the Indo-Pacific region
continues to expand. During the quarter we grew our footprint under
LOGCAP V to providing logistics and support in the
Philippines. We also completed the pre-transition site survey
in Kwajalein and anticipate phase-in of this program to start by
the end of the year. Our revenue in INDOPACOM now makes up
approximately 5% of our total revenue compared to 1% in the same
period last year."
"Our client campaigns remain instrumental to our growth and
diversification strategy," said Prow. "During the third quarter we
continued to build on our Navy campaign and won several noteworthy
contracts that advanced our position as the premier converged
infrastructure company. First, Vectrus was awarded a prime
OTA contract to provide automation in the receipt and tracking of
materials for the Naval Air Warfare Center Aircraft Division.
Secondly, Vectrus was awarded a contract to further develop the
Real-Time Spectrum Operations software for the U.S. Navy fleet.
This important effort is responsible for providing spectrum
planning, sensing, monitoring, characterization, prediction,
management, and maneuvering capabilities to support
Electro-Magnetic Spectrum Operations. This win was based on our
decades of experience providing leading-edge electromagnetic
environmental effects engineering and spectrum operations.
Finally, Vectrus was awarded a position on a $93 million five-year multiple award IDIQ
contract to provide research and development, engineering,
integration, test, cybersecurity, upgrade, and sustainment for
various tactical threat systems for the Navy."
Third Quarter 2021 Results
Third quarter 2021 revenue of $459.4
million was up $107.0 million
or 30.4% year-on-year. Revenue grew by $61.2 million year-on-year as a result of the
company's two acquisitions on December 31,
2020 and grew $45.8 million or
13.0% organically. "Our organic and total revenue growth in the
quarter was substantial and driven by Vectrus' ability to provide
critical solutions in support of our clients' missions across all
time zones," said Susan Lynch,
Senior Vice President and Chief Financial Officer.
Operating income was $12.9 million
or 2.8% margin. M&A and integration related expenses of
$3.3 million and amortization of
acquired intangible assets of $2.6
million were incurred in the quarter. Adjusted
operating income1 was $18.8
million or 4.1% margin. Adjusted EBITDA1 was
$20.5 million or 4.5% margin as
compared to $17.0 million or 4.8% in
the prior year. "Our strong topline growth in the quarter had
considerable material and pass-through content which carries with
it a lower margin," said Lynch. "Year-on-year margin was also
influenced by the phase-in of new awards, program completions and
contract mix."
Lynch continued, "We are continuing to strategically invest in
our business to enhance our capability and support future growth
while phasing-in new programs that are expected to show incremental
margin progression over time."
Fully diluted EPS for the third quarter of 2021 was $0.87 cents as compared to $0.88 cents in the prior years' quarter.
Fully diluted EPS in the quarter included the aforementioned
M&A and integration related costs, higher interest expense, and
prior years' effect of tax credits taken in the period.
Adjusted diluted EPS1 was $1.15 in the quarter as compared to $0.97 cents in the prior year.
Cash provided by operating activities through October 1,
2021 was $53.4 million, compared to
cash provided by operating activities of $37.7 million in the same period last year.
Prior year's year-to-date cash flows benefitted from the CARES Act
by $9.9 million. The increase
year-to-date over the prior year is due to strong collections and
working capital management. "Excluding the prior year benefit of
the CARES Act payroll tax deferrals, year-to-date cash flow from
operations improved 92% over last year. Operating cash flow in the
quarter was $39.4 million, an
impressive result that was driven by our teams focus on cash
collections and process improvement," said Lynch.
Net debt at October 1, 2021 was $71.8 million, up $69.5
million from October 2, 2020. Total debt at
October 1, 2021 was $128.0
million, up $62.0 million from
$66.0 million at October 2,
2020. Both net debt and total debt were up due to the
acquisitions of Zenetex and HHB on December
31, 2020. Cash at quarter-end was $56.2 million. Total consolidated
indebtedness to consolidated EBITDA1 (total leverage
ratio) was 1.33x.
Lynch continued, "The outstanding performance by our team in the
third quarter has further strengthened our balance sheet and
enabled an additional pay-down of debt in the quarter of
$45 million, reducing Vectrus' net
debt to EBITDA leverage ratio to 0.75x. We plan to leverage our
strong balance sheet and growth profile to enhance our current
credit facility to a larger, more favorable, and flexible structure
in order to support our growth plan and thoughtful deployment of
capital on acquisitions that align with our strategy."
Total backlog as of October 1, 2021 was $4.9 billion and funded backlog was $1.2 billion. The trailing twelve-month
book-to-bill was 1.3x as of October 1, 2021.
2021 Guidance
Lynch continued, "We are reiterating our previous 2021 guidance
ranges." Guidance for 2021 is as follows:
$ millions, except
for EBITDA margins and per share amounts
|
2020
Actual
|
2021
Guidance
|
2021
Mid-Point
|
2021 Mid-Point vs
2020
|
Revenue
|
$1,396
|
$1,745
|
to
|
$1,780
|
$1,762
|
26.2%
|
Operating Income
Margin
|
3.1%
|
3.7%
|
to
|
3.9%
|
3.8%
|
70 bps
|
Adjusted EBITDA
Margin1
|
4.0%
|
4.8%
|
to
|
5.0%
|
4.9%
|
90 bps
|
Earnings Per
Share
|
$3.14
|
$3.96
|
to
|
$4.28
|
$4.12
|
31.2%
|
Adjusted Diluted
Earnings Per Share1
|
$3.36
|
$4.76
|
to
|
$5.07
|
$4.92
|
46.4%
|
Net Cash Provided by
Operating Activities
|
$64.1
|
$58.0
|
to
|
$65.0
|
$61.5
|
(4.1%)
|
Forward-looking statements are based upon current expectations
and are subject to factors that could cause actual results to
differ materially from those suggested here, including those
factors set forth in the Safe Harbor Statement below.
Third Quarter 2021 Conference Call
Management will conduct a conference call with analysts and
investors at 4:30 p.m. ET on Tuesday,
November 9, 2021. U.S.-based participants may dial in to the
conference call at 844-825-9789, while international participants
may dial 412-317-5180. A live webcast of the conference call as
well as an accompanying slide presentation will be available on the
Vectrus Investor Relations website at http://investors.vectrus.com
or https://www.webcaster4.com/Webcast/Page/1431/43364.
A replay of the conference call will be posted on the Vectrus
website shortly after completion of the call and will be available
for one year. A telephonic replay will also be available through
November 23, 2021, at 844-512-2921
(domestic) or 412-317-6671 (international) with passcode
10161138.
Footnotes:
1 See "Key Performance Indicators and Non-GAAP
Financial Measures" for reconciliation.
About Vectrus
For more than 70 years, Vectrus has provided critical mission
support for our customers' toughest operational challenges. As a
high-performing organization with exceptional talent, deep domain
knowledge, a history of long-term customer relationships, and
groundbreaking technical expertise, we deliver innovative,
mission-matched solutions for our military and government customers
worldwide. Whether it's base operations support, supply chain and
logistics, IT mission support, engineering and digital integration,
security, or maintenance, repair, and overhaul, our customers count
on us for on-target solutions that increase efficiency, reduce
costs, improve readiness, and strengthen national security. Vectrus
is headquartered in Colorado Springs,
Colo., and includes about 9,200 employees spanning 206
locations in 27 countries. In 2020, Vectrus generated sales of
$1.4 billion. For more information,
visit the company's website at www.vectrus.com or connect with
Vectrus on Facebook, Twitter, and LinkedIn.
Safe Harbor Statement
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995 (the "Act"): Certain material presented herein
includes forward-looking statements intended to qualify for the
safe harbor from liability established by the Act. These
forward-looking statements include, but are not limited to, all of
the statements and items listed in the table in "2021 Guidance"
above and other assumptions contained therein for purposes of such
guidance, other statements about our 2021 performance outlook,
five-year growth plan, revenue, DSO, contract opportunities, the
impacts of COVID-19, and any discussion of future operating or
financial performance.
Whenever used, words such as "may," "are considering," "will,"
"likely," "anticipate," "estimate," "expect," "project," "intend,"
"plan," "believe," "target," "could," "potential," "continue,"
"goal" or similar terminology are forward-looking statements. These
statements are based on the beliefs and assumptions of our
management based on information currently available to
management.
These forward-looking statements are not guarantees of future
performance, conditions, or results, and involve a number of known
and unknown risks, uncertainties, assumptions, and other important
factors, many of which are outside our management's control, that
could cause actual results to differ materially from the results
discussed in the forward-looking statements. For a
discussion of some of the risks and important factors that
could cause actual results to differ from such forward-looking
statements, see the risks and other factors detailed from time to
time our Annual Report on Form 10-K, Quarterly Reports on Form
10-Q, and other filings with the U.S. Securities and Exchange
Commission.
We undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
VECTRUS,
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 1,
|
|
October 2,
|
|
October 1,
|
|
October 2,
|
(In thousands,
except per share data)
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Revenue
|
|
$
|
459,408
|
|
|
$
|
352,415
|
|
|
$
|
1,364,257
|
|
|
$
|
1,040,212
|
|
Cost of
revenue
|
|
418,900
|
|
|
320,234
|
|
|
1,235,209
|
|
|
951,743
|
|
Selling, general, and
administrative expenses
|
|
27,618
|
|
|
17,344
|
|
|
77,045
|
|
|
58,718
|
|
Operating
income
|
|
12,890
|
|
|
14,837
|
|
|
52,003
|
|
|
29,751
|
|
Interest expense,
net
|
|
(1,955)
|
|
|
(939)
|
|
|
(6,140)
|
|
|
(3,988)
|
|
Income from
operations before income taxes
|
|
10,935
|
|
|
13,898
|
|
|
45,863
|
|
|
25,763
|
|
Income tax
expense
|
|
677
|
|
|
3,507
|
|
|
7,623
|
|
|
5,593
|
|
Net income
|
|
$
|
10,258
|
|
|
$
|
10,391
|
|
|
$
|
38,240
|
|
|
$
|
20,170
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.87
|
|
|
$
|
0.89
|
|
|
$
|
3.27
|
|
|
$
|
1.74
|
|
Diluted
|
|
$
|
0.87
|
|
|
$
|
0.88
|
|
|
$
|
3.23
|
|
|
$
|
1.72
|
|
Weighted average
common shares outstanding - basic
|
|
11,726
|
|
|
11,621
|
|
11,696
|
|
|
11,590
|
Weighted average
common shares outstanding - diluted
|
|
11,849
|
|
|
11,751
|
|
11,830
|
|
|
11,743
|
VECTRUS,
INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
|
|
|
|
October 1,
|
|
December
31,
|
(In thousands,
except share information)
|
|
2021
|
|
2020
|
Assets
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
56,232
|
|
|
$
|
66,949
|
|
Restricted
cash
|
|
—
|
|
|
1,778
|
|
Receivables
|
|
337,072
|
|
|
314,959
|
|
Other current
assets
|
|
39,331
|
|
|
24,702
|
|
Total current
assets
|
|
432,635
|
|
|
408,388
|
|
Property, plant, and
equipment, net
|
|
23,560
|
|
|
22,573
|
|
Goodwill
|
|
316,978
|
|
|
339,702
|
|
Intangible assets,
net
|
|
69,088
|
|
|
48,105
|
|
Right-of-use
assets
|
|
43,111
|
|
|
18,718
|
|
Other non-current
assets
|
|
9,379
|
|
|
6,325
|
|
Total non-current
assets
|
|
462,116
|
|
|
435,423
|
|
Total
Assets
|
|
$
|
894,751
|
|
|
$
|
843,811
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts
payable
|
|
$
|
211,585
|
|
|
$
|
159,586
|
|
Compensation and other
employee benefits
|
|
73,521
|
|
|
79,568
|
|
Short-term
debt
|
|
10,400
|
|
|
8,600
|
|
Other accrued
liabilities
|
|
46,803
|
|
|
40,657
|
|
Total current
liabilities
|
|
342,309
|
|
|
288,411
|
|
Long-term debt,
net
|
|
116,623
|
|
|
168,751
|
|
Deferred tax
liability
|
|
39,966
|
|
|
39,386
|
|
Other non-current
liabilities
|
|
54,052
|
|
|
42,325
|
|
Total non-current
liabilities
|
|
210,641
|
|
|
250,462
|
|
Total
liabilities
|
|
552,950
|
|
|
538,873
|
|
Commitments and
contingencies (Note 10)
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
Preferred stock; $0.01
par value; 10,000,000 shares authorized; No shares issued and
outstanding
|
|
—
|
|
|
—
|
|
Common stock; $0.01
par value; 100,000,000 shares authorized; 11,726,707 and 11,624,717
shares issued and outstanding as of October 1, 2021 and
December 31, 2020,
respectively
|
|
117
|
|
|
116
|
|
Additional paid in
capital
|
|
86,285
|
|
|
82,823
|
|
Retained
earnings
|
|
260,266
|
|
|
222,026
|
|
Parent company
equity
|
|
—
|
|
|
—
|
|
Accumulated other
comprehensive loss
|
|
(4,867)
|
|
|
(27)
|
|
Total shareholders'
equity
|
|
341,801
|
|
|
304,938
|
|
Total Liabilities
and Shareholders' Equity
|
|
$
|
894,751
|
|
|
$
|
843,811
|
|
VECTRUS,
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
|
|
|
|
Nine Months
Ended
|
|
|
October 1,
|
|
October 2,
|
(In
thousands)
|
|
2021
|
|
2020
|
Operating
activities
|
|
|
|
|
Net income
|
|
$
|
38,240
|
|
|
$
|
20,170
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation
expense
|
|
4,788
|
|
|
3,001
|
|
Amortization of
intangible assets
|
|
7,521
|
|
|
3,031
|
|
Loss on disposal of
property, plant, and equipment
|
|
65
|
|
|
63
|
|
Stock-based
compensation
|
|
6,927
|
|
|
6,499
|
|
Amortization of debt
issuance costs
|
|
689
|
|
|
286
|
|
Changes in assets and
liabilities:
|
|
|
|
|
Receivables
|
|
(22,835)
|
|
|
3,584
|
|
Other
assets
|
|
(15,743)
|
|
|
(8,826)
|
|
Accounts
payable
|
|
55,653
|
|
|
(1,988)
|
|
Deferred
taxes
|
|
780
|
|
|
(7,575)
|
|
Compensation and other
employee benefits
|
|
(5,737)
|
|
|
813
|
|
Other
liabilities
|
|
(16,970)
|
|
|
18,597
|
|
Net cash provided
by operating activities
|
|
53,378
|
|
|
37,655
|
|
Investing
activities
|
|
|
|
|
Purchases of capital
assets and intangibles
|
|
(7,650)
|
|
|
(3,348)
|
|
Proceeds from the
disposition of assets
|
|
16
|
|
|
—
|
|
Business acquisition
purchase price adjustment
|
|
262
|
|
|
—
|
|
Contribution to joint
venture
|
|
(2,496)
|
|
|
—
|
|
Net cash used in
investing activities
|
|
(9,868)
|
|
|
(3,348)
|
|
Financing
activities
|
|
|
|
|
Repayments of
long-term debt
|
|
(6,000)
|
|
|
(4,500)
|
|
Proceeds from
revolver
|
|
352,000
|
|
|
151,000
|
|
Repayments of
revolver
|
|
(397,000)
|
|
|
(151,000)
|
|
Proceeds from exercise
of stock options
|
|
113
|
|
|
59
|
|
Payment of debt
issuance costs
|
|
(17)
|
|
|
—
|
|
Payments of employee
withholding taxes on share-based compensation
|
|
(2,317)
|
|
|
(1,918)
|
|
Net cash used in
financing activities
|
|
(53,221)
|
|
|
(6,359)
|
|
Exchange rate effect
on cash
|
|
(2,784)
|
|
|
468
|
|
Net change in cash,
cash equivalents and restricted cash
|
|
(12,495)
|
|
|
28,416
|
|
Cash, cash
equivalents and restricted cash-beginning of year
|
|
68,727
|
|
|
35,318
|
|
Cash, cash
equivalents and restricted cash-end of period
|
|
$
|
56,232
|
|
|
$
|
63,734
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
Interest
paid
|
|
$
|
4,706
|
|
|
$
|
3,030
|
|
Income taxes
paid
|
|
$
|
9,068
|
|
|
$
|
12,570
|
|
Purchase of capital
assets on account
|
|
$
|
480
|
|
|
$
|
373
|
|
Key Performance Indicators and Non-GAAP Measures
The primary financial performance measures we use to manage our
business and monitor results of operations are revenue trends and
operating income trends. Management believes that these financial
performance measures are the primary drivers for our earnings and
net cash from operating activities. Management evaluates its
contracts and business performance by focusing on revenue,
operating income, and operating margin. Operating income represents
revenue less both cost of revenue and selling, general and
administrative (SG&A) expenses. Cost of revenue consists of
labor, subcontracting costs, materials, and an allocation of
indirect costs, which includes service center transaction costs.
SG&A expenses consist of indirect labor costs (including wages
and salaries for executives and administrative personnel), bid and
proposal expenses and other general and administrative expenses not
allocated to cost of revenue. We define operating margin as
operating income divided by revenue.
We manage the nature and amount of costs at the program level,
which forms the basis for estimating our total costs and
profitability. This is consistent with our approach for managing
our business, which begins with management's assessing the bidding
opportunity for each contract and then managing contract
profitability throughout the performance period.
In addition to the key performance measures discussed above, we
consider adjusted operating income, adjusted operating margin,
adjusted net income, adjusted diluted earnings per share, EBITDA,
adjusted EBITDA, EBITDA margin, adjusted EBITDA margin, and organic
revenue to be useful to management and investors in evaluating our
operating performance, and to provide a tool for evaluating our
ongoing operations. This information can assist investors in
assessing our financial performance and measures our ability to
generate capital for deployment among competing strategic
alternatives and initiatives. We provide this information to our
investors in our earnings releases, presentations, and other
disclosures.
Adjusted operating income, adjusted operating margin, adjusted
net income, adjusted diluted earnings per share, EBITDA, adjusted
EBITDA, EBITDA margin, adjusted EBITDA margin, and organic revenue,
however, are not measures of financial performance under GAAP and
should not be considered a substitute for operating income,
operating margin, net income, and diluted earnings per share as
determined in accordance with GAAP. Definitions and
reconciliations of these items are provided below.
- Adjusted operating income is defined as operating
income, adjusted to exclude items that may include, but are not
limited to significant charges or credits, and unusual and
infrequent non-operating items, such as M&A, integration and
related costs, LOGCAP V pre-operational legal costs, and
amortization of acquired intangible assets that impact current
results but are not related to our ongoing operations.
- Adjusted operating margin is defined as adjusted
operating income divided by revenue.
- Adjusted net income is defined as net income, adjusted
to exclude items that may include, but are not limited to,
significant charges or credits, and unusual and infrequent
non-operating items, such as M&A, integration and related
costs, LOGCAP V pre-operational legal costs, and amortization of
acquired intangible assets that impact current results but are not
related to our ongoing operations.
- Adjusted diluted earnings per share is defined as
adjusted net income divided by the weighted average diluted common
shares outstanding.
- EBITDA is defined as operating income, adjusted to
exclude depreciation and amortization.
- Adjusted EBITDA is defined as EBITDA, adjusted to
exclude items that may include, but are not limited to, significant
charges or credits and unusual and infrequent non-operating items,
such as M&A, integration and related costs, LOGCAP V
pre-operational legal costs that impact current results but are not
related to our ongoing operations.
- EBITDA margin is defined as EBITDA divided by
revenue.
- Adjusted EBITDA margin is defined as Adjusted EBITDA
divided by revenue.
- Organic revenue is defined as revenue, adjusted to
exclude revenue from acquired companies.
Adjusted Net
Income, Adjusted Diluted Earnings Per Share (Non-GAAP
Measures)
|
|
|
|
|
|
|
|
|
($K, except per
share data)
|
|
Three Months Ended
October 01, 2021 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Three Months Ended
October 01, 2021 - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
459,408
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
459,408
|
|
Growth
|
|
30.4
|
%
|
|
|
|
|
|
|
|
|
|
30.4
|
%
|
Operating
income
|
|
$
|
12,890
|
|
|
$
|
3,284
|
|
|
$
|
10
|
|
|
$
|
2,630
|
|
|
$
|
—
|
|
|
$
|
18,814
|
|
Operating
margin
|
|
2.8
|
%
|
|
|
|
|
|
|
|
|
|
4.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
$
|
(1,955)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,955)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations before income taxes
|
|
$
|
10,935
|
|
|
$
|
3,284
|
|
|
$
|
10
|
|
|
$
|
2,630
|
|
|
$
|
—
|
|
|
$
|
16,859
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
$
|
677
|
|
|
$
|
546
|
|
|
$
|
2
|
|
|
$
|
438
|
|
|
$
|
1,524
|
|
|
$
|
3,187
|
|
Income tax
rate
|
|
6.2
|
%
|
|
|
|
|
|
|
|
|
|
18.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
10,258
|
|
|
$
|
2,738
|
|
|
$
|
8
|
|
|
$
|
2,192
|
|
|
$
|
(1,524)
|
|
|
$
|
13,672
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding, diluted
|
|
11,849
|
|
|
|
|
|
|
|
|
|
|
11,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
|
0.87
|
|
|
$
|
0.23
|
|
|
$
|
—
|
|
|
$
|
0.18
|
|
|
$
|
(0.13)
|
|
|
$
|
1.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (Non-GAAP
Measures)
|
|
|
|
|
|
|
|
|
|
|
|
|
($K)
|
|
Three Months Ended
October 01, 2021 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Three Months Ended
October 01, 2021 - Adjusted
|
Operating
Income
|
|
$
|
12,890
|
|
|
$
|
3,284
|
|
|
$
|
10
|
|
|
$
|
2,630
|
|
|
$
|
—
|
|
|
$
|
18,814
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
|
4,320
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2,630)
|
|
|
$
|
—
|
|
|
$
|
1,690
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
17,210
|
|
|
$
|
3,284
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20,504
|
|
EBITDA
Margin
|
|
3.7
|
%
|
|
|
|
|
|
|
|
|
|
4.5
|
%
|
Adjusted Net
Income, Adjusted Diluted Earnings Per Share (Non-GAAP
Measures)
|
|
|
|
|
|
|
|
|
($K, except per
share data)
|
|
Three Months Ended
October 02, 2020 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Three Months Ended
October 02, 2020 - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
352,415
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
352,415
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
14,837
|
|
|
$
|
121
|
|
|
$
|
38
|
|
|
$
|
1,003
|
|
|
$
|
—
|
|
|
$
|
15,999
|
|
Operating
margin
|
|
4.2
|
%
|
|
|
|
|
|
|
|
|
|
4.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
$
|
(939)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(939)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations before income taxes
|
|
$
|
13,898
|
|
|
$
|
121
|
|
|
$
|
38
|
|
|
$
|
1,003
|
|
|
$
|
—
|
|
|
$
|
15,060
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
$
|
3,507
|
|
|
$
|
28
|
|
|
$
|
9
|
|
|
$
|
170
|
|
|
$
|
—
|
|
|
$
|
3,714
|
|
Income tax
rate
|
|
25.2
|
%
|
|
|
|
|
|
|
|
|
|
24.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
10,391
|
|
|
$
|
93
|
|
|
$
|
29
|
|
|
$
|
833
|
|
|
$
|
—
|
|
|
$
|
11,346
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding, diluted
|
|
11,751
|
|
|
|
|
|
|
|
|
|
|
11,751
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
|
0.88
|
|
|
$
|
0.01
|
|
|
$
|
—
|
|
|
$
|
0.07
|
|
|
$
|
—
|
|
|
$
|
0.97
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (Non-GAAP
Measures)
|
|
|
|
|
|
|
|
|
|
|
|
|
($K)
|
|
Three Months Ended
October 02, 2020 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Three Months Ended
October 02, 2020 - Adjusted
|
Operating
Income
|
|
$
|
14,837
|
|
|
$
|
121
|
|
|
$
|
38
|
|
|
$
|
1,003
|
|
|
$
|
—
|
|
|
$
|
15,999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
|
2,033
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,003)
|
|
|
$
|
—
|
|
|
$
|
1,030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
16,870
|
|
|
$
|
121
|
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,029
|
|
EBITDA
Margin
|
|
4.8
|
%
|
|
|
|
|
|
|
|
|
|
4.8
|
%
|
Adjusted Net
Income, Adjusted Diluted Earnings Per Share (Non-GAAP
Measures)
|
|
|
|
|
|
|
($K, except per
share data)
|
|
Nine Months Ended
October 01, 2021 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Nine Months Ended
October 01, 2021 - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
1,364,257
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,364,257
|
|
Growth
|
|
31.2
|
%
|
|
|
|
|
|
|
|
|
|
31.2
|
%
|
Operating
income
|
|
$
|
52,003
|
|
|
$
|
3,284
|
|
|
$
|
188
|
|
|
$
|
7,521
|
|
|
$
|
—
|
|
|
$
|
62,996
|
|
Operating
margin
|
|
3.8
|
%
|
|
|
|
|
|
|
|
|
|
4.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
$
|
(6,140)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(6,140)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations before income taxes
|
|
$
|
45,863
|
|
|
$
|
3,284
|
|
|
$
|
188
|
|
|
$
|
7,521
|
|
|
$
|
—
|
|
|
$
|
56,856
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
$
|
7,623
|
|
|
$
|
546
|
|
|
$
|
31
|
|
|
$
|
1,250
|
|
|
$
|
1,524
|
|
|
$
|
10,974
|
|
Income tax
rate
|
|
16.6
|
%
|
|
|
|
|
|
|
|
|
|
19.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
38,240
|
|
|
$
|
2,738
|
|
|
$
|
157
|
|
|
$
|
6,271
|
|
|
$
|
(1,524)
|
|
|
$
|
45,882
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding, diluted
|
|
11,830
|
|
|
|
|
|
|
|
|
|
|
11,830
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
|
3.23
|
|
|
$
|
0.23
|
|
|
$
|
0.01
|
|
|
$
|
0.53
|
|
|
$
|
(0.13)
|
|
|
$
|
3.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (Non-GAAP
Measures)
|
|
|
|
|
|
|
|
|
|
|
|
|
($K)
|
|
Nine Months Ended
October 01, 2021 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Nine Months Ended
October 01, 2021 - Adjusted
|
Operating
Income
|
|
$
|
52,003
|
|
|
$
|
3,284
|
|
|
$
|
188
|
|
|
$
|
7,521
|
|
|
$
|
—
|
|
|
$
|
62,996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
|
12,309
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(7,521)
|
|
|
$
|
—
|
|
|
$
|
4,788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
64,312
|
|
|
$
|
3,284
|
|
|
$
|
188
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
67,784
|
|
EBITDA
Margin
|
|
4.7
|
%
|
|
|
|
|
|
|
|
|
|
5.0
|
%
|
Adjusted Net
Income, Adjusted Diluted Earnings Per Share (Non-GAAP
Measures)
|
|
|
|
|
|
|
($K, except per
share data)
|
|
Nine Months Ended
October 02, 2020 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Nine Months Ended
October 02, 2020 - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
1,040,212
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,040,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
29,751
|
|
|
$
|
2,409
|
|
|
$
|
225
|
|
|
$
|
3,031
|
|
|
$
|
—
|
|
|
$
|
35,416
|
|
Operating
margin
|
|
2.9
|
%
|
|
|
|
|
|
|
|
|
|
3.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
$
|
(3,988)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,988)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations before income taxes
|
|
$
|
25,763
|
|
|
$
|
2,409
|
|
|
$
|
225
|
|
|
$
|
3,031
|
|
|
$
|
—
|
|
|
$
|
31,428
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
$
|
5,593
|
|
|
$
|
554
|
|
|
$
|
48
|
|
|
$
|
512
|
|
|
$
|
—
|
|
|
$
|
6,707
|
|
Income tax
rate
|
|
21.7
|
%
|
|
|
|
|
|
|
|
|
|
21.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
20,170
|
|
|
$
|
1,855
|
|
|
$
|
177
|
|
|
$
|
2,519
|
|
|
$
|
—
|
|
|
$
|
24,721
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding, diluted
|
|
11,743
|
|
|
|
|
|
|
|
|
|
|
11,743
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
|
1.72
|
|
|
$
|
0.16
|
|
|
$
|
0.02
|
|
|
$
|
0.21
|
|
|
$
|
—
|
|
|
$
|
2.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (Non-GAAP
Measures)
|
|
|
|
|
|
|
|
|
|
|
|
|
($K)
|
|
Nine Months Ended
October 02, 2020 As Reported
|
|
M&A,
Integration and Related Costs
|
|
LOGCAP V
Pre-Operational Legal Costs
|
|
Amortization of
Acquired Intangible Assets
|
|
Prior Years' Tax
Credits
|
|
Nine Months Ended
October 02, 2020 - Adjusted
|
Operating
Income
|
|
$
|
29,751
|
|
|
$
|
2,409
|
|
|
$
|
225
|
|
|
$
|
3,031
|
|
|
$
|
—
|
|
|
$
|
35,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
|
6,032
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,031)
|
|
|
$
|
—
|
|
|
$
|
3,001
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
35,783
|
|
|
$
|
2,409
|
|
|
$
|
225
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
38,417
|
|
EBITDA
Margin
|
|
3.4
|
%
|
|
|
|
|
|
|
|
|
|
3.7
|
%
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
October 1,
2021
|
|
October 1,
2021
|
|
October 1,
2021
|
($K)
|
|
As
Reported
|
|
Zenetex &
HHB
|
|
Organic
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
459,408
|
|
|
$
|
61,193
|
|
|
$
|
398,215
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
October 2,
2020
|
|
October 2,
2020
|
|
October 2,
2020
|
($K)
|
|
As
Reported
|
|
Zenetex &
HHB
|
|
Organic
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
352,415
|
|
|
$
|
—
|
|
|
$
|
352,415
|
|
|
|
|
|
|
|
|
Organic Revenue
$
|
|
|
|
|
|
$
|
45,800
|
|
Organic Revenue
%
|
|
|
|
|
|
13.0
|
%
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
October 1,
2021
|
|
October 1,
2021
|
|
October 1,
2021
|
($K)
|
|
As
Reported
|
|
Zenetex &
HHB
|
|
Organic
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
1,364,257
|
|
|
$
|
194,459
|
|
|
$
|
1,169,798
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
October 2,
2020
|
|
October 2,
2020
|
|
October 2,
2020
|
($K)
|
|
As
Reported
|
|
Zenetex &
HHB
|
|
Organic
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
1,040,212
|
|
|
$
|
—
|
|
|
$
|
1,040,212
|
|
|
|
|
|
|
|
|
Organic Revenue
$
|
|
|
|
|
|
$
|
129,586
|
|
Organic Revenue
%
|
|
|
|
|
|
12.5
|
%
|
SUPPLEMENTAL INFORMATION
Revenue by client branch, contract type, contract relationship,
and geographic region for the periods presented below was as
follows:
Revenue by
Client
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
(In
thousands)
|
|
2021
|
|
%
|
|
2020
|
|
%
|
|
2021
|
|
%
|
|
2020
|
|
%
|
Army
|
|
$
|
304,341
|
|
|
66
|
%
|
|
$
|
236,267
|
|
|
67
|
%
|
|
$
|
869,690
|
|
|
64
|
%
|
|
$
|
711,173
|
|
|
68
|
%
|
Air Force
|
|
63,569
|
|
|
14
|
%
|
|
79,425
|
|
|
23
|
%
|
|
207,565
|
|
|
15
|
%
|
|
231,088
|
|
|
22
|
%
|
Navy
|
|
52,556
|
|
|
11
|
%
|
|
18,785
|
|
|
5
|
%
|
|
165,391
|
|
|
12
|
%
|
|
48,564
|
|
|
5
|
%
|
Other
|
|
38,942
|
|
|
9
|
%
|
|
17,938
|
|
|
5
|
%
|
|
121,611
|
|
|
9
|
%
|
|
49,387
|
|
|
5
|
%
|
Total
revenue
|
|
$
|
459,408
|
|
|
|
|
$
|
352,415
|
|
|
|
|
$
|
1,364,257
|
|
|
|
|
$
|
1,040,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue by
Contract Type
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
(In
thousands)
|
|
2021
|
|
%
|
|
2020
|
|
%
|
|
2021
|
|
%
|
|
2020
|
|
%
|
Cost-plus and
cost-reimbursable ¹
|
|
$
|
353,789
|
|
|
77
|
%
|
|
$
|
249,484
|
|
|
71
|
%
|
|
$
|
1,018,465
|
|
|
75
|
%
|
|
$
|
748,543
|
|
|
72
|
%
|
Firm-fixed-price
|
|
105,619
|
|
|
23
|
%
|
|
102,931
|
|
|
29
|
%
|
|
345,792
|
|
|
25
|
%
|
|
291,669
|
|
|
28
|
%
|
Total
revenue
|
|
$
|
459,408
|
|
|
|
|
$
|
352,415
|
|
|
|
|
$
|
1,364,257
|
|
|
|
|
$
|
1,040,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
¹ Includes time and
material contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue by
Contract Relationship
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
(In
thousands)
|
|
2021
|
|
%
|
|
2020
|
|
%
|
|
2021
|
|
%
|
|
2020
|
|
%
|
Prime
contractor
|
|
$
|
429,370
|
|
|
93
|
%
|
|
$
|
332,564
|
|
|
94
|
%
|
|
$
|
1,272,671
|
|
|
93
|
%
|
|
$
|
980,301
|
|
|
94
|
%
|
Subcontractor
|
|
30,038
|
|
|
7
|
%
|
|
19,851
|
|
|
6
|
%
|
|
91,586
|
|
|
7
|
%
|
|
59,911
|
|
|
6
|
%
|
Total
revenue
|
|
$
|
459,408
|
|
|
|
|
$
|
352,415
|
|
|
|
|
$
|
1,364,257
|
|
|
|
|
$
|
1,040,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
|
October 1,
|
|
|
|
October 2,
|
|
|
(In
thousands)
|
|
2021
|
|
%
|
|
2020
|
|
%
|
|
2021
|
|
%
|
|
2020
|
|
%
|
Middle
East
|
|
$
|
263,257
|
|
|
57
|
%
|
|
$
|
223,544
|
|
|
63
|
%
|
|
$
|
761,758
|
|
|
56
|
%
|
|
$
|
677,449
|
|
|
65
|
%
|
United
States
|
|
139,357
|
|
|
30
|
%
|
|
87,979
|
|
|
25
|
%
|
|
435,717
|
|
|
32
|
%
|
|
250,900
|
|
|
24
|
%
|
Europe
|
|
34,902
|
|
|
8
|
%
|
|
38,108
|
|
|
11
|
%
|
|
111,604
|
|
|
8
|
%
|
|
106,171
|
|
|
10
|
%
|
Asia
|
|
21,892
|
|
|
5
|
%
|
|
2,784
|
|
|
1
|
%
|
|
55,178
|
|
|
4
|
%
|
|
5,692
|
|
|
1
|
%
|
Total
revenue
|
|
$
|
459,408
|
|
|
|
|
$
|
352,415
|
|
|
|
|
$
|
1,364,257
|
|
|
|
|
$
|
1,040,212
|
|
|
|
CONTACT:
Vectrus
Mike Smith,
CFA
719-637-5773
michael.smith@vectrus.com
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SOURCE Vectrus, Inc.