Science Applications International Corp ( SAIC ) reported a 12% revenue decline Y/Y in the fourth quarter of fiscal 2024 to $1.74 billion, beating the consensus of $1.64 billion.

Adjusted EPS of $1.43 was in line with the consensus.

The sale of the logistics and supply chain management business, the deconsolidation of the Forfeiture Support Associates J.V. (FSA), and contract completions mainly led to the decline.

Adjusting for the impact of the divestiture of the Supply Chain Business and the deconsolidation of FSA, revenues grew by 7.7%.

The adjusted operating margin declined by 160 bps to 5.1%. Adjusted EBITDA margin declined by 140 bps to 7.3%, primarily due to the sale of the Supply Chain Business and deconsolidation of FSA.

SAIC generated $97 million in free cash flow for the quarter versus $148 million a year ago. The company held $94 million in cash and equivalents as of February 2, 2024.

Net bookings for the quarter were $1.4 billion, reflecting a book-to-bill ratio of 0.8. The estimated backlog was around $23.1 billion at the end of the quarter. 

Science Applications’ board of directors declared a cash dividend of $0.37 per share of the company’s common stock, payable on April 26, 2024, to stockholders of record on April 12, 2024.

SAIC said it intends to continue paying dividends on a quarterly basis, although the declaration of any future dividends will be determined by the board each quarter.

FY25 Outlook: SAIC projects revenue of $7.35 billion – $7.50 billion (prior $7.25 billion – $7.40 billion) vs. the consensus of $7.36 billion.

SAIC reiterated adjusted EPS guidance of $8.00 – $8.20 versus the consensus of $8.15.

The stock gained 38% last year. Investors can gain exposure to the stock via Listed Funds Trust Horizon Kinetics Blockchain Development ETF and AdvisorShares Focused Equity ETF ( CWS ) .

Price Action: SAIC shares are trading lower by 9.14% at $129.60 premarket on the last check Monday.