Global information technology provider Leidos this week reported higher earnings in the fourth quarter of 2016 and the full fiscal year, in part due to its acquisition last year of Lockheed Martin’s Information Systems & Global Solutions (IS&GS) business segment.
The company reported revenue of $2.58 billion in the fourth quarter of 2016, up from $1.28 billion in the same quarter the year before. It attributed $1.35 billion in revenue during the quarter to the IS&GS acquisition. Leidos also recorded $7.04 billion in revenue for the year ended Dec. 30, 2016, up from $5.09 billion in 2015. That included $1.97 billion in IS&GS revenue.
The company reported $152 million in operating income from continuing operations for the quarter, up by $50 million year over year. Operating income for fiscal 2016 landed at $417 million, rising from $298 million in 2015. Diluted earnings per share from continuing operations were $0.39 for the fourth quarter, down from $1.72 during the prior year quarter, and $2.35 for the fiscal year, dropping from $3.19.
“The diluted share count was 104 million, up from 74 million in the prior calendar year due to the issuance of approximately 77 million shares of Leidos common stock to participating Lockheed Martin stockholders in connection with the acquisition of the IS&GS Business,” the company said in an earnings press release.
Chairman and CEO Roger Krone said during the company’s earnings call Thursday that Leidos has “fully integrated the IS&GS and Leidos people, enabling a collaborative culture which we expect will generate positive dividends, particularly our business development efforts.”
The National Nuclear Security Administration awarded a Lockheed Martin subsidiary the management and operations contract for the Nevada National Security Site shortly after the IS&GS acquisition. The agency then rescinded the award after learning that ownership of that subsidiary had changed hands to Leidos in the acquisition, and is now reconsidering bids for the contract.
Leidos is also one of the partners in Mission Support Alliance, which provides support services at the Department of Energy’s Hanford Site in Washington state.
The company projected revenue of $10 billion to $10.4 billion in 2017.
