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A month has gone by since the last earnings report for Booz Allen Hamilton (BAH). Shares have added about 14.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Booz Allen due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Booz Allen Beats on Earnings in Q1
Booz Allen reported mixed first-quarter fiscal 2021 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.
Adjusted earnings per share of 93 cents beat the consensus mark by 6.9% and improved 12% on a year-over-year basis. The bottom line benefited from top-line growth, strong contract-level performance and operational management.
Revenues, Backlog & Headcount Increase Y/Y
Total revenues of $1.96 billion lagged the Zacks Consensus Estimate by a slight margin and increased 7.1% year over year. Revenues, excluding billable expenses, were $1.41 billion, increasing 10.5% on a year-over-year basis. Billable expenses accounted for 28.1% of revenues.
Total backlog increased 15.9% from the prior-year quarter’s reported figure to $23 billion. Funded backlog of $3.44 billion increased 7.6% year over year. Unfunded backlog was up 8.8% to $4.73 billion. Priced options went up 4.9% to $12.8 billion. Book-to-bill ratio was 2.17, up 68.2% year over year. Headcount of 27,381 increased 3.8% year over year.
Operating Results
Adjusted EBITDA amounted to $213 million, up 6.8% year over year. Adjusted EBITDA margin on revenues stayed flat year over year at 10.9%. Adjusted EBITDA margin on revenues, excluding billable expenses, decreased to 15.1% from 15.6% in the year-ago quarter.
Balance Sheet & Cash Flow
Booz Allen Hamilton exited fiscal first quarter with cash and cash equivalents of $620.6 million compared with $450.8 million at the end of the prior quarter. Long-term debt (net of current portion) was $2 billion, roughly flat with the previous quarter. The company generated $140.4 million of net cash from operating activities. Capital expenditure was $20.1 million and free cash flow was $120.4 million for the March-end quarter.
The company paid out dividends worth $43.8 million and repurchased shares worth $85.9 million in the reported quarter.
Fiscal 2021 Outlook
The company’s revenue-growth projection is 6-10%. The adjusted earnings per share guidance is $3.40-$3.60. The midpoint ($3.50) of the guided range is below the Zacks Consensus Estimate of $3.59.