x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
22-1852179
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
12015 Lee Jackson Highway, Fairfax, VA
|
22033
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer
|
x
|
Accelerated filer
|
o
|
Non-accelerated filer
|
o
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
o
|
|
|
Page No.
|
|
||
Item 1.
|
|
|
|
Condensed Consolidated Balance Sheets as of June 30, 2016 and December 31, 2015
|
|
|
Condensed Consolidated Statements of Income for the Three and Six Months Ended June 30, 2016 and 2015
|
|
|
Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2016 and 2015
|
|
|
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2016 and 2015
|
|
|
Notes to Condensed Consolidated Financial Statements
|
|
Item 2.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
|
Item 3.
|
||
Item 4.
|
||
|
||
Item 1.
|
||
Item 1A.
|
||
Item 6.
|
Item 1.
|
Financial Statements
|
|
(unaudited)
|
||||||
|
June 30,
2016 |
|
December 31,
2015 |
||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents
|
$
|
40,117
|
|
|
$
|
41,314
|
|
Receivables—net
|
299,090
|
|
|
304,253
|
|
||
Prepaid expenses and other
|
24,435
|
|
|
23,605
|
|
||
Total Current Assets
|
363,642
|
|
|
369,172
|
|
||
Goodwill
|
951,353
|
|
|
919,591
|
|
||
Other intangible assets—net
|
160,993
|
|
|
154,176
|
|
||
Employee supplemental savings plan assets
|
28,147
|
|
|
27,557
|
|
||
Property and equipment—net
|
21,935
|
|
|
22,439
|
|
||
Investments
|
11,008
|
|
|
10,853
|
|
||
Other assets
|
2,370
|
|
|
2,636
|
|
||
TOTAL ASSETS
|
$
|
1,539,448
|
|
|
$
|
1,506,424
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
LIABILITIES
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
95,388
|
|
|
$
|
106,271
|
|
Accrued salaries and related expenses
|
65,384
|
|
|
60,940
|
|
||
Billings in excess of revenue earned
|
15,304
|
|
|
12,685
|
|
||
Total Current Liabilities
|
176,076
|
|
|
179,896
|
|
||
Deferred income taxes—non-current
|
112,759
|
|
|
102,035
|
|
||
Accrued retirement
|
28,260
|
|
|
29,877
|
|
||
Other long-term liabilities
|
11,361
|
|
|
10,879
|
|
||
TOTAL LIABILITIES
|
328,456
|
|
|
322,687
|
|
||
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
||
STOCKHOLDERS' EQUITY
|
|
|
|
||||
Common stock, Class A—$0.01 par value; 150,000,000 shares authorized; 25,270,296 and 24,731,584 shares issued at June 30, 2016 and December 31, 2015; 25,026,183 and 24,487,471 shares outstanding at June 30, 2016 and December 31, 2015
|
253
|
|
|
247
|
|
||
Common stock, Class B—$0.01 par value; 50,000,000 shares authorized; 13,191,845 and 13,191,845 shares issued and outstanding at June 30, 2016 and December 31, 2015
|
132
|
|
|
132
|
|
||
Additional paid-in capital
|
453,332
|
|
|
438,168
|
|
||
Treasury stock, 244,113 and 244,113 shares at cost at June 30, 2016 and December 31, 2015
|
(9,158
|
)
|
|
(9,158
|
)
|
||
Retained earnings
|
766,538
|
|
|
754,457
|
|
||
Accumulated other comprehensive loss
|
(105
|
)
|
|
(109
|
)
|
||
TOTAL STOCKHOLDERS’ EQUITY
|
1,210,992
|
|
|
1,183,737
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
1,539,448
|
|
|
$
|
1,506,424
|
|
|
(unaudited)
Three months ended June 30, |
|
(unaudited)
Six months ended June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
REVENUES
|
$
|
401,354
|
|
|
$
|
384,378
|
|
|
$
|
792,016
|
|
|
$
|
754,708
|
|
Cost of services
|
341,511
|
|
|
326,243
|
|
|
675,025
|
|
|
640,392
|
|
||||
General and administrative expenses
|
35,629
|
|
|
37,023
|
|
|
70,832
|
|
|
73,358
|
|
||||
OPERATING INCOME
|
24,214
|
|
|
21,112
|
|
|
46,159
|
|
|
40,958
|
|
||||
Interest expense
|
(306
|
)
|
|
(329
|
)
|
|
(595
|
)
|
|
(604
|
)
|
||||
Interest income
|
19
|
|
|
24
|
|
|
63
|
|
|
91
|
|
||||
Other income (expense), net
|
45
|
|
|
72
|
|
|
53
|
|
|
(69
|
)
|
||||
INCOME FROM OPERATIONS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS
|
23,972
|
|
|
20,879
|
|
|
45,680
|
|
|
40,376
|
|
||||
Provision for income taxes
|
(9,250
|
)
|
|
(8,544
|
)
|
|
(17,810
|
)
|
|
(16,283
|
)
|
||||
Equity in gains of unconsolidated subsidiaries
|
60
|
|
|
115
|
|
|
128
|
|
|
115
|
|
||||
NET INCOME
|
$
|
14,782
|
|
|
$
|
12,450
|
|
|
$
|
27,998
|
|
|
$
|
24,208
|
|
BASIC EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
||||||||
Class A common stock
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.65
|
|
Class B common stock
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.65
|
|
DILUTED EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
||||||||
Class A common stock
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.64
|
|
Class B common stock
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.64
|
|
|
(unaudited)
Three months ended June 30, |
|
(unaudited)
Six months ended June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
NET INCOME
|
$
|
14,782
|
|
|
$
|
12,450
|
|
|
$
|
27,998
|
|
|
$
|
24,208
|
|
OTHER COMPREHENSIVE INCOME (LOSS):
|
|
|
|
|
|
|
|
||||||||
Translation adjustments, net of tax
|
4
|
|
|
(8
|
)
|
|
4
|
|
|
(33
|
)
|
||||
COMPREHENSIVE INCOME
|
$
|
14,786
|
|
|
$
|
12,442
|
|
|
$
|
28,002
|
|
|
$
|
24,175
|
|
|
(unaudited)
Six months ended June 30, |
||||||
|
2016
|
|
2015
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
27,998
|
|
|
$
|
24,208
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
15,150
|
|
|
14,547
|
|
||
Deferred income taxes
|
9,090
|
|
|
7,493
|
|
||
Stock-based compensation
|
1,291
|
|
|
2,697
|
|
||
Excess tax benefits from exercise of stock options
|
(421
|
)
|
|
(58
|
)
|
||
Equity in gains of unconsolidated subsidiaries
|
(128
|
)
|
|
(115
|
)
|
||
Gain on sale and retirement of property and equipment
|
—
|
|
|
(695
|
)
|
||
Change in assets and liabilities—net of effects from acquired businesses:
|
|
|
|
||||
Receivables—net
|
5,149
|
|
|
32,105
|
|
||
Prepaid expenses and other
|
(830
|
)
|
|
2,287
|
|
||
Employee supplemental savings plan asset
|
(590
|
)
|
|
3,241
|
|
||
Accounts payable and accrued expenses
|
(10,679
|
)
|
|
(37,375
|
)
|
||
Accrued salaries and related expenses
|
3,724
|
|
|
(4,215
|
)
|
||
Billings in excess of revenue earned
|
2,619
|
|
|
1,353
|
|
||
Accrued retirement
|
(1,617
|
)
|
|
(2,193
|
)
|
||
Other
|
430
|
|
|
686
|
|
||
Net cash flow from operating activities
|
51,186
|
|
|
43,966
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Acquisition of businesses—net of cash acquired
|
(47,682
|
)
|
|
(101,342
|
)
|
||
Purchases of property and equipment
|
(3,346
|
)
|
|
(2,240
|
)
|
||
Investment in capitalized software for internal use
|
(740
|
)
|
|
(359
|
)
|
||
Payments to acquire investments
|
(201
|
)
|
|
(750
|
)
|
||
Net cash flow from investing activities
|
(51,969
|
)
|
|
(104,691
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Dividends paid
|
(15,927
|
)
|
|
(15,754
|
)
|
||
Proceeds from exercise of stock options
|
15,092
|
|
|
4,352
|
|
||
Excess tax benefits from exercise of stock options
|
421
|
|
|
58
|
|
||
Borrowings under revolving credit facility
|
—
|
|
|
89,000
|
|
||
Repayments under revolving credit facility
|
—
|
|
|
(36,400
|
)
|
||
Net cash flow from financing activities
|
(414
|
)
|
|
41,256
|
|
||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
(1,197
|
)
|
|
(19,469
|
)
|
||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
41,314
|
|
|
23,781
|
|
||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
40,117
|
|
|
$
|
4,312
|
|
SUPPLEMENTAL CASH FLOW INFORMATION
|
|
|
|
||||
Cash paid for interest
|
$
|
490
|
|
|
$
|
537
|
|
Cash paid for income taxes, net
|
$
|
5,618
|
|
|
$
|
3,171
|
|
1.
|
Description of the Business
|
2.
|
Basis of Presentation
|
3.
|
Acquisitions
|
Goodwill
|
$
|
31,762
|
|
Other intangible assets
|
16,600
|
|
|
Property and equipment
|
69
|
|
|
Accounts payable and accrued expenses
|
(29
|
)
|
|
Accrued salaries and related expenses
|
(720
|
)
|
|
Net assets acquired and liabilities assumed
|
$
|
47,682
|
|
Cash and cash equivalents
|
$
|
658
|
|
Receivables
|
6,532
|
|
|
Prepaid expenses and other
|
460
|
|
|
Goodwill
|
47,487
|
|
|
Other intangible assets
|
13,219
|
|
|
Property and equipment
|
1,419
|
|
|
Investments
|
15
|
|
|
Other assets
|
31
|
|
|
Accounts payable and accrued expenses
|
(1,269
|
)
|
|
Accrued salaries and related expenses
|
(336
|
)
|
|
Billings in excess of revenue earned
|
(2
|
)
|
|
Net assets acquired and liabilities assumed
|
$
|
68,214
|
|
Receivables
|
$
|
3,901
|
|
Prepaid expenses and other
|
141
|
|
|
Goodwill
|
24,436
|
|
|
Other intangible assets
|
6,350
|
|
|
Property and equipment
|
100
|
|
|
Accounts payable and accrued expenses
|
(436
|
)
|
|
Accrued salaries and related expenses
|
(492
|
)
|
|
Net assets acquired and liabilities assumed
|
$
|
34,000
|
|
4.
|
Earnings Per Share
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Distributed earnings
|
$
|
8,004
|
|
|
$
|
7,885
|
|
|
$
|
15,918
|
|
|
$
|
15,745
|
|
Undistributed earnings
|
6,778
|
|
|
4,565
|
|
|
12,080
|
|
|
8,463
|
|
||||
Net income
|
$
|
14,782
|
|
|
$
|
12,450
|
|
|
$
|
27,998
|
|
|
$
|
24,208
|
|
|
|
|
|
|
|
|
|
||||||||
Class A common stock:
|
|
|
|
|
|
|
|
||||||||
Basic net income available to common stockholders
|
$
|
9,635
|
|
|
$
|
8,072
|
|
|
$
|
18,223
|
|
|
$
|
15,682
|
|
Basic weighted average common shares outstanding
|
24,707
|
|
|
24,325
|
|
|
24,591
|
|
|
24,266
|
|
||||
Basic earnings per share
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.65
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted net income available to common stockholders
|
$
|
9,662
|
|
|
$
|
8,084
|
|
|
$
|
18,261
|
|
|
$
|
15,711
|
|
Effect of potential exercise of stock options
|
209
|
|
|
101
|
|
|
150
|
|
|
127
|
|
||||
Diluted weighted average common shares outstanding
|
24,916
|
|
|
24,426
|
|
|
24,741
|
|
|
24,393
|
|
||||
Diluted earnings per share
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.64
|
|
|
|
|
|
|
|
|
|
||||||||
Class B common stock:
|
|
|
|
|
|
|
|
||||||||
Basic net income available to common stockholders
|
$
|
5,147
|
|
|
$
|
4,378
|
|
|
$
|
9,775
|
|
|
$
|
8,526
|
|
Basic weighted average common shares outstanding
|
13,192
|
|
|
13,193
|
|
|
13,192
|
|
|
13,193
|
|
||||
Basic earnings per share
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.65
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted net income available to common stockholders
|
$
|
5,120
|
|
|
$
|
4,366
|
|
|
$
|
9,737
|
|
|
$
|
8,497
|
|
Effect of potential exercise of stock options
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Diluted weighted average common shares outstanding
|
13,192
|
|
|
13,193
|
|
|
13,192
|
|
|
13,193
|
|
||||
Diluted earnings per share
|
$
|
0.39
|
|
|
$
|
0.33
|
|
|
$
|
0.74
|
|
|
$
|
0.64
|
|
5.
|
Receivables
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
Billed receivables
|
$
|
228,272
|
|
|
$
|
233,735
|
|
Unbilled receivables:
|
|
|
|
||||
Amounts billable
|
47,849
|
|
|
47,900
|
|
||
Revenues recorded in excess of funding
|
22,342
|
|
|
19,213
|
|
||
Retainage
|
10,235
|
|
|
11,878
|
|
||
Allowance for doubtful accounts
|
(9,608
|
)
|
|
(8,473
|
)
|
||
Receivables—net
|
$
|
299,090
|
|
|
$
|
304,253
|
|
6.
|
Property and Equipment
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
Furniture and equipment
|
$
|
47,802
|
|
|
$
|
44,718
|
|
Leasehold improvements
|
35,971
|
|
|
35,733
|
|
||
Property and equipment—gross
|
83,773
|
|
|
80,451
|
|
||
Accumulated depreciation and amortization
|
(61,838
|
)
|
|
(58,012
|
)
|
||
Property and equipment—net
|
$
|
21,935
|
|
|
$
|
22,439
|
|
7.
|
Goodwill and Other Intangible Assets
|
|
Goodwill Balance
|
||
Goodwill at December 31, 2014
|
$
|
851,640
|
|
Acquisitions
|
71,922
|
|
|
Divestiture
|
(3,971
|
)
|
|
Goodwill at December 31, 2015
|
$
|
919,591
|
|
Acquisitions
|
31,762
|
|
|
Goodwill at June 30, 2016
|
$
|
951,353
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||||||||
Other intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Contract and program intangible assets
|
$
|
298,282
|
|
|
$
|
148,922
|
|
|
$
|
149,360
|
|
|
$
|
281,682
|
|
|
$
|
140,163
|
|
|
$
|
141,519
|
|
Capitalized software cost for internal use
|
37,061
|
|
|
25,434
|
|
|
11,627
|
|
|
36,170
|
|
|
23,522
|
|
|
12,648
|
|
||||||
Other
|
58
|
|
|
52
|
|
|
6
|
|
|
58
|
|
|
49
|
|
|
9
|
|
||||||
Total other intangible assets—net
|
$
|
335,401
|
|
|
$
|
174,408
|
|
|
$
|
160,993
|
|
|
$
|
317,910
|
|
|
$
|
163,734
|
|
|
$
|
154,176
|
|
For the remaining six months ending December 31, 2016
|
$
|
11,659
|
|
For the year ending:
|
|
||
December 31, 2017
|
$
|
21,832
|
|
December 31, 2018
|
$
|
20,066
|
|
December 31, 2019
|
$
|
17,567
|
|
December 31, 2020
|
$
|
14,613
|
|
December 31, 2021
|
$
|
11,418
|
|
8.
|
Debt
|
9.
|
Commitments and Contingencies
|
10.
|
Stock-Based Compensation
|
|
Six months ended
June 30, |
||||
|
2016
|
|
2015
|
||
Volatility
|
23.66
|
%
|
|
27.16
|
%
|
Expected life of options
|
3 years
|
|
|
3 years
|
|
Risk-free interest rate
|
1.20
|
%
|
|
1.16
|
%
|
Dividend yield
|
3.00
|
%
|
|
3.00
|
%
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Aggregate Intrinsic Value
(in thousands) |
|||||
Stock options at December 31, 2014
|
3,391,032
|
|
|
$
|
32.76
|
|
|
$
|
4,722
|
|
Granted
|
237,853
|
|
|
$
|
30.87
|
|
|
|
||
Exercised
|
(284,320
|
)
|
|
$
|
27.51
|
|
|
$
|
1,348
|
|
Cancelled and expired
|
(849,255
|
)
|
|
$
|
39.56
|
|
|
|
||
Stock options at December 31, 2015
|
2,495,310
|
|
|
$
|
30.86
|
|
|
$
|
3,583
|
|
Granted
|
89,217
|
|
|
$
|
30.03
|
|
|
|
||
Exercised
|
(525,212
|
)
|
|
$
|
29.02
|
|
|
$
|
3,050
|
|
Cancelled and expired
|
(385,091
|
)
|
|
$
|
39.64
|
|
|
|
||
Stock options at June 30, 2016
|
1,674,224
|
|
|
$
|
29.37
|
|
|
$
|
14,170
|
|
|
Number of Shares
|
|
Weighted Average Fair Value
|
|||
Non-vested stock options at December 31, 2015
|
991,290
|
|
|
$
|
4.74
|
|
Granted
|
89,217
|
|
|
$
|
3.99
|
|
Vested
|
(278,457
|
)
|
|
$
|
4.88
|
|
Cancelled
|
(35,592
|
)
|
|
$
|
4.68
|
|
Non-vested stock options at June 30, 2016
|
766,458
|
|
|
$
|
4.60
|
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life
|
|
Aggregate Intrinsic Value
(in thousands) |
|||||
Stock options vested and expected to vest
|
1,586,716
|
|
|
$
|
29.37
|
|
|
3 years
|
|
$
|
13,439
|
|
Stock options exercisable
|
907,766
|
|
|
$
|
29.37
|
|
|
2 years
|
|
$
|
7,698
|
|
|
Number of Shares
|
|
Weighted Average Fair Value
|
|||
Non-vested restricted stock at December 31, 2014
|
21,000
|
|
|
$
|
30.61
|
|
Granted
|
21,000
|
|
|
$
|
28.98
|
|
Vested
|
(21,000
|
)
|
|
$
|
30.61
|
|
Non-vested restricted stock at December 31, 2015
|
21,000
|
|
|
$
|
28.98
|
|
Granted
|
18,000
|
|
|
$
|
33.84
|
|
Vested
|
(21,000
|
)
|
|
$
|
28.98
|
|
Non-vested restricted stock at June 30, 2016
|
18,000
|
|
|
$
|
33.84
|
|
|
Number of Units
|
|
Weighted Average Fair Value
|
|||
Non-vested RSUs at December 31, 2014
|
—
|
|
|
$
|
—
|
|
Granted
|
105,900
|
|
|
$
|
30.85
|
|
Forfeited
|
(12,450
|
)
|
|
$
|
30.92
|
|
Non-vested RSUs at December 31, 2015
|
93,450
|
|
|
$
|
30.84
|
|
Granted
|
104,900
|
|
|
$
|
28.26
|
|
Forfeited
|
(9,950
|
)
|
|
$
|
29.68
|
|
Non-vested RSUs at June 30, 2016
|
188,400
|
|
|
$
|
29.47
|
|
11.
|
Business Segment and Geographic Area Information
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Failure to compete effectively for new contract awards or to retain existing U.S. government contracts;
|
•
|
Delays in the competitive bidding process caused by competitors' protest of contract awards received by us;
|
•
|
Inability to recruit and retain a sufficient number of employees with specialized skill sets who are in great demand and limited supply;
|
•
|
Adverse changes or delays in U.S. government spending for programs we support, due to the failure to complete the budget and appropriations process in a timely manner, changing mission priorities, the implementation of cost reduction and efficiency initiatives by our customers, or federal budget contracts generally;
|
•
|
Failure to obtain option awards, task orders or funding under contracts;
|
•
|
Renegotiation, modification or termination of our contracts, or failure to perform in conformity with contract terms or our expectations;
|
•
|
Increased exposure to risks associated with conducting business internationally;
|
•
|
Failure to realize the full amount of our backlog, or adverse changes in the timing of receipt of revenues under contracts included in backlog;
|
•
|
Failure to successfully integrate acquired companies or businesses into our operations or to realize any accretive or synergistic effects from such acquisitions;
|
•
|
Adverse changes in business conditions that may cause our investments in recorded goodwill to become impaired;
|
•
|
Non-compliance with, or adverse changes in, complex U.S. government procurement laws, regulations or processes;
|
•
|
Disruption of our business or damage to our reputation resulting from security breaches in customer systems, internal systems or service failures (including as a result of cyber or other security threats), or employee or subcontractor misconduct; and
|
•
|
Adverse results of U.S. government audits or other investigations of our government contracts.
|
|
Three months ended
June 30, |
|
Period-to-Period Change
|
|||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2015 to 2016
|
|||||||||||
|
Dollars
|
|
Percentage
|
|
Dollars
|
|
Percentage
|
|||||||||||||
|
(dollars in thousands)
|
|||||||||||||||||||
REVENUES
|
$
|
401,354
|
|
|
$
|
384,378
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
16,976
|
|
|
4.4
|
%
|
Cost of services
|
341,511
|
|
|
326,243
|
|
|
85.1
|
%
|
|
84.9
|
%
|
|
15,268
|
|
|
4.7
|
%
|
|||
General and administrative expenses
|
35,629
|
|
|
37,023
|
|
|
8.9
|
%
|
|
9.6
|
%
|
|
(1,394
|
)
|
|
(3.8
|
)%
|
|||
OPERATING INCOME
|
24,214
|
|
|
21,112
|
|
|
6.0
|
%
|
|
5.5
|
%
|
|
3,102
|
|
|
14.7
|
%
|
|||
Interest expense
|
(306
|
)
|
|
(329
|
)
|
|
—
|
%
|
|
0.1
|
%
|
|
(23
|
)
|
|
(7.0
|
)%
|
|||
Interest income
|
19
|
|
|
24
|
|
|
—
|
%
|
|
—
|
%
|
|
(5
|
)
|
|
(20.8
|
)%
|
|||
Other income (expense), net
|
45
|
|
|
72
|
|
|
—
|
%
|
|
—
|
%
|
|
(27
|
)
|
|
(37.5
|
)%
|
|||
INCOME FROM OPERATIONS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS
|
23,972
|
|
|
20,879
|
|
|
6.0
|
%
|
|
5.4
|
%
|
|
3,093
|
|
|
14.8
|
%
|
|||
Provision for income taxes
|
(9,250
|
)
|
|
(8,544
|
)
|
|
2.3
|
%
|
|
2.2
|
%
|
|
706
|
|
|
8.3
|
%
|
|||
Equity in gains of unconsolidated subsidiaries
|
60
|
|
|
115
|
|
|
—
|
%
|
|
—
|
%
|
|
(55
|
)
|
|
(47.8
|
)%
|
|||
NET INCOME
|
$
|
14,782
|
|
|
$
|
12,450
|
|
|
3.7
|
%
|
|
3.2
|
%
|
|
$
|
2,332
|
|
|
18.7
|
%
|
|
Six months ended
June 30, |
|
Period-to-Period Change
|
|||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2015 to 2016
|
|||||||||||
|
Dollars
|
|
Percentage
|
|
Dollars
|
|
Percentage
|
|||||||||||||
|
(dollars in thousands)
|
|||||||||||||||||||
REVENUES
|
$
|
792,016
|
|
|
$
|
754,708
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
37,308
|
|
|
4.9
|
%
|
Cost of services
|
675,025
|
|
|
640,392
|
|
|
85.2
|
%
|
|
84.9
|
%
|
|
34,633
|
|
|
5.4
|
%
|
|||
General and administrative expenses
|
70,832
|
|
|
73,358
|
|
|
9.0
|
%
|
|
9.7
|
%
|
|
(2,526
|
)
|
|
(3.4
|
)%
|
|||
OPERATING INCOME
|
46,159
|
|
|
40,958
|
|
|
5.8
|
%
|
|
5.4
|
%
|
|
5,201
|
|
|
12.7
|
%
|
|||
Interest expense
|
(595
|
)
|
|
(604
|
)
|
|
—
|
%
|
|
0.1
|
%
|
|
(9
|
)
|
|
(1.5
|
)%
|
|||
Interest income
|
63
|
|
|
91
|
|
|
—
|
%
|
|
—
|
%
|
|
(28
|
)
|
|
(30.8
|
)%
|
|||
Other income (expense), net
|
53
|
|
|
(69
|
)
|
|
—
|
%
|
|
—
|
%
|
|
122
|
|
|
176.8
|
%
|
|||
INCOME FROM OPERATIONS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS
|
45,680
|
|
|
40,376
|
|
|
5.8
|
%
|
|
5.3
|
%
|
|
5,304
|
|
|
13.1
|
%
|
|||
Provision for income taxes
|
(17,810
|
)
|
|
(16,283
|
)
|
|
2.3
|
%
|
|
2.1
|
%
|
|
1,527
|
|
|
9.4
|
%
|
|||
Equity in gains of unconsolidated subsidiaries
|
128
|
|
|
115
|
|
|
—
|
%
|
|
—
|
%
|
|
13
|
|
|
11.3
|
%
|
|||
NET INCOME
|
$
|
27,998
|
|
|
$
|
24,208
|
|
|
3.5
|
%
|
|
3.2
|
%
|
|
$
|
3,790
|
|
|
15.7
|
%
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 6.
|
Exhibits
|
|
|
MANTECH INTERNATIONAL CORPORATION
|
|
|
|
|
|
|
|
By:
|
/s/ GEORGE J. PEDERSEN
|
Date:
|
July 29, 2016
|
Name:
|
George J. Pedersen
|
|
|
Title:
|
Chairman of the Board of Directors and
Chief Executive Officer
|
|
|
By:
|
/s/ KEVIN M. PHILLIPS
|
Date:
|
July 29, 2016
|
Name:
|
Kevin M. Phillips
|
|
|
Title:
|
Chief Financial Officer
|
LENDERS:
|
BANK OF AMERICA, N.A., as a Lender and L/C Issuer
|
By:
|
|
/s/ GEORGE J. PEDERSEN
|
|
|
|
Name:
|
|
George J. Pedersen
|
Title:
|
|
Chairman of the Board of Directors and
Chief Executive Officer
|
By:
|
|
/s/ KEVIN M. PHILLIPS
|
|
|
|
Name:
|
|
Kevin M. Phillips
|
Title:
|
|
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
By:
|
|
/s/ GEORGE J. PEDERSEN
|
|
|
|
Name:
|
|
George J. Pedersen
|
Title:
|
|
Chairman of the Board of Directors and
Chief Executive Officer
|
By:
|
|
/s/ KEVIN M. PHILLIPS
|
|
|
|
Name:
|
|
Kevin M. Phillips
|
Title:
|
|
Chief Financial Officer
|