Management services company Booz Allen Hamilton Holding Corp. (BAH) on Friday reported a profit for the third quarter that almost tripled from last year on higher revenues and lower interest expenses. Earnings for the quarter topped analysts' expectations by a penny, while revenues missed their estimates. Looking ahead, the company forecast earnings per share for fiscal 2012 and 2013 in line with analysts' expectations.
The company's third-quarter net income almost tripled to $62.86 million or $0.44 per share from $23.64 million or $0.18 per share in the year-ago period.
Adjusted earnings rose to $56.40 million or $0.40 per share from $35.16 million or $0.27 per share in the prior-year quarter. On average, nine analysts polled by Thomson Reuters expected the company to earn $0.39 per share. Analysts' estimates typically exclude special items.
Revenue for the quarter grew 3.9 percent to $1.44 billion from $1.39 billion in the prior-year quarter, but missed analysts' consensus estimate of $1.47 billion.
The revenue growth reflects 5 percent growth in revenue derived from direct consulting staff labor and a 0.6 percent growth in billable expenses.
The growth in revenue derived from direct consulting staff labor was primarily due to improved deployment of direct consulting staff, including the deployment of 300 net additional consulting staff, against funded backlog under existing contracts and funded backlog under new contracts in all markets as well as increased other direct costs.
Booz Allen's total backlog as of December 31, 2011 was $12.22 billion, up 11 percent from $11.01 billion a year ago.
The company's board of directors declared a cash dividend of $0.09 per share, payable on February 29 to stockholders of record at the close of business on February 13.
Looking ahead, Booz Allen anticipates incurring a restructuring charge of about $10 million to $14 million pretax in the fourth quarter, associated with one-time termination benefits that will be paid to departing employees.
For fiscal year 2012, Booz Allen narrowed its prior guidance for earnings per share, which is now expected in a range of $1.66 to $1.70, and adjusted earnings in a range of $1.58 to $1.62 per share. The company continues to forecast revenue growth and margin improvements, and currently forecasts year-over-year revenue growth for fiscal 2012 between 4.5 and 5.5 percent.
Analysts expect the company to earn $1.60 per share for the year on revenues of $5.97 billion.
Booz Allen noted that for fiscal 2012 and 2013, there will continue to be greater uncertainty in the second half of the company's fiscal year, which coincides with the beginning of a new government fiscal year.
The company's initial forecast is for revenue growth for fiscal 2013 in the low-to-mid single digits, earnings per share in a range of $1.62 to $1.72, and adjusted earnings per share of $1.71 to $1.81 per share.
Analysts expect the company to earn $1.76 per share on revenues of $6.38 billion.
BAH closed Thursday's trading at $17.86, up $0.07 on 135,900 shares. In Friday's pre-market, the stock is adding $0.20 or 1.12 percent to $18.06.
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