Earnings rose at Leidos, Reston, Va., in the fourth quarter, which the federal contractor and services provider attributed to its diverse portfolio, although CEO Roger Krone said plans are underway for a government shutdown — just in case.
Net earnings for the fourth quarter ended Dec. 30 were $180 million or $1.28 a share, up from $176 million or $1.23 a share, in the year-ago quarter, the company reported in a Tuesday press release. Annual earnings for 2022 declined to $693 million or $4.96 a share from $759 million or $5.27 a share.
Net income for the year was affected by a $26-million net benefit recorded in the first quarter of 2021 from an adjustment to legal reserves related to the Leidos-led Mission Support Alliance joint venture, Leidos said in the release. Mission Support Alliance was the landlord contractor at the Department of Energy’s Hanford Site in Washington state. It was replaced by another Leidos-led joint venture in 2020.
Quarterly revenue was $3.7 billion, up year-over-year from $3.5 billion, Leidos said. The full-year revenue was about $14.4 billion, up from $13.7 billion in 2021.
Quarterly segment operating income for the Civil group, where Leidos coordinates its Department of Energy business, was $74 million, up from $61 million a year ago. Annual operating income fell to $234 million from $248 million in 2021.
Quarterly segment revenue for Civil was $938 million, up $800 million in the year-ago period. The segment revenue for the year was about $3.5 billion, up from roughly $3.2 billion in 2021.
“As a matter of prudence, we are preparing contingency plans around a potential government shutdown” although the most likely outcome is that a fiscal 2024 omnibus budget will be reached without a shutdown,” Krone said. The CEO figures, “the better prepared we are, the less likely we are to ever use the [shutdown] plan.”
Likewise, Krone expects House of Representatives Speaker Kevin McCarthy (R-Calif.) and President Joe Biden will “find a way to raise the debt ceiling” before the deadline in early June.
