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May 11, 2010Vangent, Inc. Announces First Quarter 2010 Financial Results- First Quarter Revenue Increase of 46% Over First Quarter 2009 Driven by Government Group - - Operating Income Grew 55% Over First Quarter 2009 - Arlington, VA - May 11, 2010 - Vangent, Inc., a leading global provider of information management and strategic business process services, today announced its first quarter 2010 financial results. Quarter-to-Quarter Comparison Vangent reported revenue from continuing operations of $194.2 million for the quarter ended April 3, 2010, an increase of $61.3 million or 46.0% compared to $132.9 million in the year ago period. The increase in total revenue from continuing operations reflects a $59.5 million or 50% increase in revenue from the Government Group. The increase is primarily attributable to $48.8 million in revenue from Vangent's 2010 U.S. Census contract. In addition, Vangent had strong year-over-year growth with its core customers, including $5.6 million in increased revenue from contracts with the Centers for Medicare and Medicaid Services and the Centers for Disease Control and Prevention, $3.4 million in revenue from the Military Health System and $3.1 million related to an increase in revenue earned on Vangent's contract with the Office of Federal Student Aid at the U.S. Department of Education. Also contributing to higher revenue in the three months ended April 3, 2010 was a $2.1 million increase in International Group revenue driven by the favorable impact of foreign currency exchange rates as well as additional revenue from contracts in the United Kingdom. The first quarter ended April 3, 2010 was six days longer than the corresponding period in 2009, further contributing to the increase in revenue. Offsetting the increase in Government and International Group revenue was a 6% decline in Human Capital Group revenue for the quarter ended April 3, 2010. The decline in revenue is due to the substantial completion of Vangent's contract with the U.S. Air Force to modernize the learning infrastructure of the Royal Saudi Air Force. Operating income increased 55% to $18.1 million for the quarter ended April 3, 2010 compared to $11.7 million for the quarter ended March 28, 2009. The increase in operating income was primarily due to increase in revenue related to Vangent's U.S. Census contract. Vangent reported net income of $5.6 million for the three months ended April 3, 2010, an increase of $4.6 million compared to the prior year quarter. Adjusted EBITDA grew to $27.0 million for the first quarter of 2010, compared with $20.7 million for the prior year quarter. The increase in Adjusted EBITDA was primarily attributable to the increase in Government Group operating income. Vangent booked $24.4 million in new backlog in the first quarter of 2010, a period in which new contract awards are generally slower. Vangent's total contract backlog, which is the amount of revenue the Company expects to realize over the remaining term of the contracts, including the base period and all option years, totaled $1.9 billion at April 3, 2010. Vangent's funded backlog, the portion for which funding has been authorized, totaled $457.1 million at April 3, 2010. "We are pleased with our first quarter results," said Mac Curtis, President and Chief Executive Officer of Vangent. "Our strong revenue, profitability and cash position reflects consistent execution in our core Government Group business, including our work supporting the 2010 U.S. Census. We also are pleased with the continued growth of our health solutions business including our expanding Military Health System portfolio. Overall, we are well positioned for the remainder of 2010 as we continue to identify and capitalize on opportunities with the Obama Administration's healthcare reform legislation and other policy initiatives. Our recent investments in corporate development are paying off and a significant number of new business opportunities are under evaluation." Liquidity, Cash Flow and Balance Sheet Information Total long-term debt at April 3, 2010 was $406.8 and cash and cash equivalents were $10.7 million. Net cash used in operating activities was $19.0 million for the three months ended April 3, 2010, an increase of $9.2 million compared to the prior year period primarily due to working capital requirements for the 2010 U.S. Census contract. Vangent's total liquidity, which includes $49.8 million available under its revolving credit facility, was $60.5 million. Discontinued Operations In the fourth quarter of 2009, Vangent completed an evaluation of its international business and committed to a plan to sell its business operations in Latin America. The consolidated financial statements have been revised for all periods presented to report our Latin American business as discontinued operations. Revenue from discontinued operations totaled $7.1 million for first quarter ended April 3, 2010, compared to $4.6 million in the year ago period. The increase in revenue from discontinued operations reflects $2.9 million from Mexico from a contract with Mexico's social security agency. Net loss from discontinued operations for the three months ended April 3, 2010 totaled $2.4 million compared to a net loss of $0.6 million in the comparable year period. The net loss includes a $2.6 million non-cash charge to increase the Company's provision for an expected loss on the disposal of the Latin America business. Q1 2010 Financial Results Conference Call Audio Replay Vangent's first quarter 2010 financial statements including its Quarterly Report on Form 10-Q will be made available on the company's website at www.vangent.com in connection with Vangent Q1 2010 Financial Results Conference Call. About Vangent, Inc. Forward-Looking Statements View the Press Release Archives |  |
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