L-1 Identity Solutions reports Q4 and 2008 results

Company records Q4 2008 non-cash goodwill and intangible asset impairment charges


* The division announced contracts and agreements in 2008 valued at $143.5 million from Advanced Concepts Information Technology Solutions and $74.0 million from McClendon Engineering and Analytical Solutions. Due to the confidentiality of customer programs, most contracts in this division cannot be publically announced.

* SpecTal Intelligence Services experienced year-over-year growth in 2008 of 36 percent.

Forward Looking Financial Expectations

The Company expects revenue for the first quarter ending March 31, 2009 of between $145.0 million - $150.0 million, Adjusted EBITDA of $17.0 million - $19.0 million and an EPS loss in the range of ($0.05) - ($0.03). Earnings per diluted share, exclusive of stock based compensation, is expected to be in the range of $(0.02) - $(0.01).

The Company expects revenue to increase throughout the year, driven by follow-on business with existing customers and new awards for the Biometrics and Secure Credentialing divisions that were recently awarded or scheduled for shipment later in the year.

Excluding any further acquisitions, the Company expects revenue for the full-year ending December 31, 2009 of $725.0 - $750.0 million, organic growth of 15-20 percent, Adjusted EBITDA of $100.0 million - $110.0 million, unlevered free cash flow of between $75.0 million - $85.0 million, and EPS of $0.08 - $0.15. Earnings per diluted share, exclusive of stock based compensation, is expected to be in the range of $0.20 - $0.27.

At the end of Q4 2008, total net debt is approximately $446.5 million which includes $292.0 million outstanding in senior secured loans, $175.0 million of convertible notes and $20.5 million in cash.

Looking ahead, the Company’s 2009 expected Adjusted EBITDA and free cash flow is adequate to cover operating expenses, fixed debt service, and capital expenditures. The Company also expects to have excess cash to pay down debt in excess of required amortization. In addition, the Company has approximately $120.5 million available under a revolving credit facility after letters of credit and subject to debt covenants.