SRA Announces Financial Results for First Quarter of Fiscal Year 2008

FAIRFAX, Va., Nov. 7 /PRNewswire-FirstCall/ -- SRA International, Inc. (NYSE: SRX), a leading provider of technology and strategic consulting services and solutions to federal government organizations, today announced operating results for the first quarter of fiscal year 2008, which ended September 30, 2007 .

Revenue for the quarter was $364.1 million, up 20% from $304.0 million in the September 2006 quarter. Operating income for the quarter was $29.9 million, for an operating margin of 8.2%. Net income was $18.5 million, for a net margin of 5.1%. Diluted earnings per share for the quarter were $0.31, up $0.05 year over year.

These first quarter financial results include the effect of the Constella Group acquisition as of August 9, 2007 . Constella contributed about $30 million of revenue and was accretive to earnings per share.

SRA President and CEO Stan Sloane said, "We're pleased to see solid returns on our marketing and sales investments. Despite the challenging market conditions, we've bolstered our backlog with a number of valuable wins, and we've continued to devote more resources to the next wave of bid opportunities."

CFO and Executive Vice President for Operations Stephen Hughes added, "One of the tenets of our strategic plan is to drive G&A cost efficiencies to increase our investment in business and employee development and to expand margins, and we were highly successful on those fronts in the quarter. Cash flows were also strong as we held Days Sales Outstanding to 69 days, equaling our best figure to date."

New Business Awards

The Company won new business in the first quarter with potential value of $829 million, if all options are exercised. As of September 30, 2007 , the Company's backlog of signed business orders was $4.0 billion, an increase of 10% year over year. Constella's contract backlog is included in that total.

SRA was also awarded several multiple-award, indefinite delivery, indefinite quantity (ID/IQ) contracts in the September quarter. ID/IQ wins are not included in the Company's quarterly bookings figure, but they provide a solid foundation for future growth. The largest ID/IQ that the Company won in the September quarter was Alliant, a General Services Administration contract vehicle with a $50 billion ceiling value over 10 years. The contract is currently under protest.

Forward Guidance

SRA is providing forward guidance for the second quarter and fiscal year 2008. The table below represents management's current expectations about the Company's future financial performance, based on information available at this time. The forward guidance in this table does not include any effect for acquisitions SRA might make in the future.

Conference Call

SRA senior management will hold a conference call to discuss these operating results and forward guidance today at 5:00 PM Eastern. Interested parties may listen to the conference call by dialing (888) 287-9905 (U.S./Canada) or (706) 643-7540 (Other) with passcode 19411259. The conference call will be Webcast simultaneously through a link on the SRA Web site (www.sra.com). A replay of the conference call will be available approximately two hours after the conclusion of the call through November 21, 2007 by dialing (800) 642-1687 (U.S./Canada) or (706) 645-9291 (Other) and entering passcode 19411259.

About SRA International, Inc.

SRA is a leading provider of technology and strategic consulting services and solutions -- including systems design, development, and integration; and outsourcing and managed services -- to clients in national security, civil government, and health care and public health markets. The Company also delivers business solutions for contingency and disaster response planning, information assurance, business intelligence, environmental strategies, enterprise architecture, infrastructure management, and wireless integration.

FORTUNE(R) magazine has chosen SRA as one of the "100 Best Companies to Work For" for eight consecutive years. The Company's 6,300 employees serve clients from its headquarters in Fairfax, Virginia, and offices around the world. For additional information on SRA, please visit www.sra.com.

Any statements in this press release about future expectations, plans, and prospects for SRA, including guidance about future financial results and statements about the estimated value of contracts and work to be performed, and other statements containing the words "estimates," "believes," "anticipates," "plans," "expects," "will," and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: our dependence on our contracts with federal government agencies, particularly within the U.S. Department of Defense, for substantially all of our revenue; our dependence on our GSA schedule contracts and our position as a prime contractor on government-wide acquisition contracts to grow our business; our ability to attract and retain skilled employees; any reductions in or reallocations of the U.S. defense budget or the budgets for civil government agencies; the market price of the company's stock prevailing from time to time; the nature of other investment opportunities presented to the company from time to time; the company's cash flows from operations; and other factors discussed in our latest quarterly report on Form 10-K filed with the Securities and Exchange Commission on August 16, 2007 . In addition, the forward-looking statements included in this press release represent our views as of November 7, 2007 . We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward- looking statements should not be relied upon as representing our views as of any date subsequent to November 7, 2007 .

Organic revenue growth, as presented, measures revenue growth adjusted for the impact of acquisitions. The Company believes that this non-GAAP financial measure provides useful information because it allows investors to better assess the underlying growth rate of the Company's existing business. This non-GAAP financial measure should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

SOURCE SRA International, Inc.



Loading