Q1 2022 Science Applications International Corp Earnings Call
And while probably will cover the financial details I would like to highlight that their financial profile is accretive to saic's with strong revenue growth and low double digit EBITDA margin.
And with over 4 years of 'twenty, and 'twenty revenue and backlog they offer strong revenue visibility through saic's fiscal year 2024.
Please turn to slide 6.
Also headquartered here in Northern Virginia, Halfacre and associates is home to over 550 highly skilled credentialed and mission focused professionals as.
As I mentioned they serve several critically important federal health customers with a large presence and the department of Veterans Affairs, where they are a top 5 provider on the $22 billion T..4 Mg vehicle.
They also serve valued customers and the centers for Medicare and Medicaid services Department of health and human services and health customers and the department of defense.
As you can see on this chart they provide some of the most in demand services across the federal government today.
We remain confident that priorities such as digital services data analytics cyber security and cloud solutions will continue to drive investment from our customers.
Can you please discuss the financial details of the half acre and associates acquisition.
Thank you and ASIC and good afternoon, everyone.
As you can see on slide 6 the half acre and associates transaction has an attractive financial profile that continues saic's upward progress and multiple financial areas.
And they generated approximately $166 million of calendar 2020 revenues and are expected to grow in the mid to high single digit growth rates and the current year margins run in the low double digit EBITDA range due to the entire portfolio being fixed price and time and materials contracts Hofacker and associates has good cash.
Generation that will be additive to saic's attractive profile and as <unk> mentioned to have high visibility into their future revenue stream with over 4 times their 2020 revenues and backlog and relatively rural Recompete risk for the next few years, providing confidence and continued growth. Please turn to slide 7.
Let me provide a financial overview of the transaction with an all cash purchase price of $250 million, including about 30% to $35 million in tax assets Saic's acquiring this business at under 10 times calendar 2021, adjusted EBITDA after adjusting for the tax assets.
This acquisition is accretive to our fiscal 2022, our revenue growth rate adjusted earnings per share and free cash flow. We have not included any cost synergy assumptions and the acquisition model.
We expect to fund the transaction with cash on hand, and incremental debt, adding about a fifth of return of leverage to our existing ratio.
With only a modest increase to leverage we will continue to have capital deployment flexibility throughout this year and we do not expect this acquisition to have any material impact to our capital deployment flexibility. We have made tremendous progress on delevering. Following our acquisition of Unisys Federal and we will continue to make progress going forward.
We expect the transaction to close and the second quarter of this year subject to customary closing conditions, including regulatory approvals for your modeling purposes, we expect the transaction to generate between $90 million and $100 million of incremental revenue in fiscal year 2022, which is not included in our guidance today, we will.
Update our guidance to reflect this acquisition after it closes and in our September call Nozick back to you.
Thank you.
Let me briefly discuss our results for the quarter as reported in our press release today Saic's first quarter results reflect strong performance across the board.
The team delivered strong revenue and profitability excellent cash flow and outstanding business development results.
Organic growth for the first quarter was 2.6% and adjusted EBITDA margin was 9.8% and all time high.
And I see continues to deliver strong cash flow and we are allocating capital for value creation.
We have a balanced customer portfolio that allows us to remain agile and government priorities changed with.
With a third of our annual revenue coming from federal civilian customers, we are well positioned and several agencies targeted for increased investment through this recent budget request.
Saic's responding to the increased investments proposed by the administration and the enduring long term technology needs of our nation.
Our balanced portfolio further strengthened by this acquisition bolstered by our refresh strategy, we will continue to produce long term sustainable value creation.
And probably will now discuss the details of our first quarter results and financial outlook for the rest of the year.
Thank you and ASIC and good afternoon, everyone.
SAIC delivered a quarter of strong performance across all business development and financial measures I see the foundation being laid for future success through strong financial alignment and execution in line with our strategy.
Saic's results for the first quarter of fiscal year 2020 to reflect robust contract awards increased organic revenue growth strong profitability and free cash flow let.
Let me start with our strong business development results net bookings for the first quarter were approximately $4.2 billion.
Translating to a quarterly book to Bill of 2.2 and a trailing 12 month book to Bill of 2 <unk>. The most significant contributions to our quarterly bookings are disclosed in our press release today.
At the end of the first quarter Saic's total contract backlog stood at nearly $24 billion.
Up 11% from the fourth quarter and 43% from a year ago.
And at the end of the first quarter the value of submitted proposals was $18.1 billion down from last quarter, reflecting our business development success and the first quarter approximately 60% of the value of submitted proposals is for new business opportunities and we continue to invest for future growth and a year of relative.
Low recompete left.
Let me now turn to financial results for the quarter.
Our first quarter revenues of approximately $1.9 billion.
Reflect growth of 7% as compared to the first quarter of last fiscal year due to 6 weeks of incremental Unisys federal revenues, new business contracts, primarily supporting it modernization for our U S Air force customer and increased revenues on existing contracts, excluding the impact of the Unisys federal.
Acquisition first quarter revenue grew organically by 2.6%.
First quarter, adjusted EBITDA was $184 million, a $47 million increase from the prior year adjusted EBITDA margin was 9.8% after adjusting for $10 million of acquisition and integration costs first quarter margin performance was very strong across the business.
And the quarter favorably benefited from the timing of indirect costs and the nonrecurring, but favorable benefit from the settlement of prior year indirect rates for the quarter COVID-19 negatively impacted adjusted EBITDA by about $4 million.
Net income for the first quarter was $81 million and diluted earnings per share was $1.38 for the quarter inclusive of the first quarter acquisition and integration costs of $10 million. Excluding these costs as well as amortization of intangibles and net of a tax rate of approximately 23% in the quarter.
<unk>, our adjusted diluted earnings per share was $1.94.
First quarter free cash flow was $164 million a quarter of strong cash generation and day sales outstanding at the end of the quarter were 57 days down 2 days from the fourth quarter.
During the first quarter, we deployed $71 million of capital through share repurchases dividends and capital expenditures. In addition, we continued to delever, making mandatory debt repayments and ended the quarter with a net leverage ratio of just under 3.5 times, we prioritize share repurchases over.
Voluntary debt repayment and the quarter.
As announced on our press release today, our board of Directors has approved a quarterly cash dividend of <unk> 37, a share payable on July 30 to shareholders of record on July 16th.
Now turning to our forward outlook as noted in our press release today and slide 10 of the presentation slides.
Based on first quarter performance and our outlook for the rest of the year, we have updated our guidance to the following.
Revenues between 7 and 1.5 billion and $7.3 billion.
And raising the lower end of our previous range, reflecting lower estimated full year COVID-19 impacts of approximately $150 million.
Down from $1.50 million to $200 million.
Our updated revenue guidance reflects 1% to 3% organic revenue growth in fiscal 'twenty 2 including this impact. Additionally for your modeling purposes I'd like to remind you of the seasonality of our revenue profile, where we typically see lower revenues and the second quarter due to employee holidays and summer vacations.
Adjusted EBITDA margins between $8, 7 and 8.8% again, raising the lower end of our previous range, reflecting our strong Q1 performance on EBITDA dollars. We now expect COVID-19 to have approximately $10 million of impact in fiscal 'twenty, 2 down from $10 million to $15 million consistent with the <unk>.
<unk> and our revenue estimates.
Adjusted diluted earnings per share between $6.15.
And $6.40.
Raising both the top and bottom and 15 <unk>.
Love, our previous range, reflecting our strong start to the year.
Free cash flow unchanged at between $430 and $470 million summing up we are pleased with our strong performance of Q1 and look forward to solid execution over the remainder of the year Nasik back to you for concluding remarks.
Thank you Pablo.
I wanted to take a moment to thank all of our 26000 employees for their dedication to our customers through and incredibly unique and challenging year.
SAIC are optimistic about our future hopefully you hear that from both property and myself, we have work to capture that energy and optimism and our new branding campaign titled bring on Tomorrow.
We are excited about the future and what we can and will do to advance our customers' missions and support our talented employees and drive value for our shareholders.
Our optimism lies not only and what the future will bring to SAIC, but also with what SAIC will bring to the future.
We are excited to bring on tomorrow, operator, we're now ready to take questions.
At this time, if you would like to ask a question. Please press Star then the number 1 on your telephone keypad.
First question is from the line of share <unk> with Jefferies.
Good evening, everyone. Thanks for the time, thank and Pablo and staying the course.
Yes.
So I guess to start off on your core business.
And ability was really good and the quarter 9.8% EBITDA margins your guidance on the full year and 7.
Hi, it's basically why does everything get worse from here outside of Q2 seasonality.
Thanks for the question Sheila.
And as I mentioned and my prepared remarks, there were some nonrecurring favorable items that benefited Q1.
We specifically referred to the settlement of prior year indirect rates as well as on Underrun on our overall indirect spend at the first quarter and.
As you step back and kind of adjusted sort of our operating performance in the quarter for those items, we get to operating margin rate and that's in the high 8% range I'd say, that's sort of roughly in line with where we ended Q4.
FY 'twenty, 1 so I'd say in line with that so what that would imply for the rest of the year is EBITDA margin rates, that's roughly in the mid 8% I would say there is first.
And first quarter here behind Us we have 3 quarters left and our guidance today I would say is a balanced view of the risks and the opportunities ahead of us for the rest of the year and as I've often said the teams are incentivized to do better over the course of the year and I think we're pleased with the strong performance to start the year and hopefully we're poised to have a really good year.
Okay. Yeah, we saw some of those incentives come out and the proxy.
And then just in terms of the acquisition and it was a $166 million and revenue is enough.
Dennis.
Bob.
Yes.
I missed the last part and Thats can make us.
In terms of the health acquisition and $166 million and sales I think you mentioned and.
And your remarks is that enough to actually build a hub business, but that's on a scale yes.
And my take is and our take is that this was a perfect.
Perfect acquisition at the right time at the right price.
Is extremely strong cultural fit to SAIC very mission focused very purpose driven organization and when we marry it with our modest health business.
Give us a very strong position and a couple of key customers as well as some very compelling contract vehicles. So.
And so we're very pleased with this acquisition and very excited about the opportunity to bring on this company and to SAIC.
Okay. Thank you very much.
Thank you.
Sure you are.
Next question is from the line of Joseph de Nardi with Stifel.
Thanks, Good evening.
Hey, Joe maybe just 1 on on the acquisition it looks like debt <unk>.
For Engie contract as a substantial portion of that business. So can you talk about what you all expect to be able to do with that contract.
That <unk> couldnt do on their own and should we expect greater market share from you all and do you think kind of the current dynamics affecting the health market right now results in net contract being larger than expected over time as that part of the thesis as well.
So.
So a couple of comments that you made are exactly right on the that.
And that particular contract for LNG.
Very important contract and the health space serving veterans.
Organization so so.
And so for US we did not have that vehicle. Obviously, so it was a very important part of the acquisition thesis and allows US great access for the next several years to be able to sell cross sell SAIC services into that vehicle. So.
And so that was a very important part of this acquisition and we believe that the 2 companies coming together really position us well they've got a half acre has great market access great relationships.
And as well as compelling solutions and services, but then when you layer and the breadth of Saic's capabilities and the sales domain and the solution domain, we believe that it creates a great opportunity for us to expand our presence.
Okay. That's helpful and then perhaps and maybe just on the on the labor market can you talk about what Youre seeing there in terms of productivity and what your expectations are for that over the next few quarters.
And on maybe employees are able to take time off and do that sort of thing to the.
And the extent that they werent able to past year or 2 thank you.
Yes so.
So as Steve noted we were all looking at what the future looks like as we come out on what we hope to be the back side of this particular pandemic cycle and we're all very optimistic and we're seeing a couple of things.
And we did have great productivity and a lot of folks, but and a lot of extra hours and I'm very appreciative to the SAIC employees that did that over the course of <unk>.
And this last year.
We are seeing things come back to a more normalized environment and we're very pleased for that and.
Any expectations, we would have and leave and time off or put into our guidance.
And are already factored in but we're not seeing a significant shift and any behavior and for our normal business Q2 tends to be a.
And opportunity for employees to take more time off.
Paul the cross holidays, and vacation cycles, and again, that's factored into our guidance as well.
We're very pleased with the performance of the SAIC employees and and look forward to a more normative environment over the course of the next many months.
Thank you.
Okay.
Your next question is from the line of Matthew acres with Wells Fargo.
Yes, hi, guys good afternoon.
<unk> on the deal I wanted to ask.
And I guess.
And kind of the bid process for this deal were there any other kind of competitive and Erin.
Bidders here it looks like you've got pretty reasonable price on it.
And then I guess I guess also on <unk> I guess are there any other than T. For NGA, you mentioned and any any big contracts that are either.
Re competes coming up or kind of big big drivers of growth here that we should watch going forward.
Okay terrific. This is NASDAQ so it was a competitive process and.
And most most sales most acquisitions are in our space.
And we're very very pleased to have been selected by half Baker to go forward again and I'll touch on a couple of things. In addition to the price which is obviously always important. We also look very heavily and cultural fit and very pleased with the the culture of the organization and I had the privilege of meeting with the CEO, we've met with a senior.
Team and and again the cultural fit is so important and the services business, but it is a purpose driven culture and mission.
And oriented culture, which is very consistent with SAIC, so very very pleased with that.
And I'm very happy that they select.
And selected us to to continue their journey.
As it relates to the contracts, obviously T for LNG as a critical contract and as I alluded in my our I mentioned in my remarks, we have about 4 years of revenue.
And backlog so feel very good about our position and there really isn't in the near term any significant re compete.
Debt that would cause any kind of change material change and the revenue profile of the business.
That answer all your questions.
Yes, that's great. Thank you and then I guess, if I could do 1 more I guess on the Covid impact to revenue. So I think you've got had $33 million impact on the quarter.
$150 million for the year. So I guess implies there's still a lot left to go and I think and.
Last quarter, you guys have talked about that mostly wrapping up I think and the first half of your fiscal year is that still the right way to think about it or has that shifted out a little bit.
Yes, I mean, I think thats.
Still the right way to think about this Matt I would say.
Taking the first quarter number and sort of prorating and across the year would not get you to 150, obviously, but I think within the updated expectation of $1.50, I think we still notionally see some element of risk there in the supply chain portfolio.
And I think 1 of the quarterly impact was lower than prior quarters I'd say there is still some uncertainty around the sustainability of the buying patterns at these levels and previously we've talked about thinking about weekly revenue for this business and that $10 million to $15 million range a week.
I'd say when we provided guidance and a few months back we were probably near the bottom of that range.
Little over $10 million and where we are right now is about the middle of the range. So I would say still a far way to go to get to the top of the range here, but that sort of is what gives us an element of caution as we think about the full year and this virus appears to have 1 step ahead of us and have returned and it seems like so we're cautious about the way we're thinking about it and.
That's why we've lowered our expectations for full year, but we're still holding about $1.50 for the year.
Got it okay. Thank you.
Your next question is from the line of.
Kevin Parsons with Goldman Sachs.
Hi, Good afternoon, Hey, Kevin.
Because if organic growth was 2.6% on the quarter.
The midpoint of your updated guidance implies just 1% for the rest of the year and this was your nose and your toughest comp trailing book to bills to Porto Covid headwind diminishes going forward, So I guess, what drives and the slowdown and organic over the rest of the year and were there any onetime items or pull forward that you had this quarter.
And again and thanks for the question and Purdue here and ill take this 1 first.
So I would say.
If you think about the Q1, there is clearly seasonality in the revenue pattern here.
Q1 tends to be 1 of our stronger quarters.
Along with Q3, I would say and Q2 and Q4 tend to be weaker quarters, primarily due to the holidays within those quarters. So I would say a little careful on annualized in Q1 across the 4 quarters to get to a number that would imply.
Total year number of higher than $7.3 billion, but.
But I would say as we're thinking through it.
<unk> impact we saw for the year was on the Covid side. So we've reflected that and the updated guidance I'd say, we continue to see some progress as we go through the rest of the year.
As we've previously flagged we do see some ramp in growth rates in the second half of the year, primarily associated with both our <unk> and now we call them <unk> contracts as well as the army rich contract, we do see that ramp occurring still in the second half of the year, but I'd say there is a fair amount of variability as we sit here right now.
Now in Q1 and would love to be having this conversation over the course of the next several quarters, but I would say it's still early in the year. We've got some 3 quarters to go so.
Okay. So it sounds like there's still some variability that could drive you to the higher low end of the range outside of Covid are correct. Okay great.
Great.
Similar question on margins and maybe to Sheila asked earlier, but.
Given you didn't adjust the onetime benefit out of the first quarter I assume that's and guidance for the year, but you only raised the margin guidance by the change from the Covid impact.
And that implies you see a worse margin for the rest of the year than you were previously expecting.
Well, so I'd say, what this implies for the rest of the year is margin rates and the mid 8% I'd say on the indirect rate benefit that we booked in Q1 some of that was in our forecast for the year. It ended up occurring.
Order or 2 earlier than we expected we don't actually expect the indirect reach to Underrun and on a full year basis. So we actually do expect that to trend back up so as we think about pressures on margin rate and.
And if you align that with the fact that the supply chain business as it continues to recover brings and margin at a lower rate than the rest of the portfolio. So as you put all those factors together you end up with a little more pressure on margin rate in the back half of the year and Thats why we are holding.
Increased margin rate guidance to about 10 basis points right now and the low end.
Got it and 1 more quick 1 if I could you mentioned that 60% of the submitted pipeline is new business.
You have a sense for how much of what you've won over the last year or so has been new versus recompete and a sense.
Callouts and the press release, we're pretty heavily recompete and tilted.
So, yes, I'd say typically referred to high levels of Recompete win rates on the last call and I would probably sort of leave it there for now our win rates are competitive and they are good but we typically don't disclose them.
Okay. Thank you.
Your next question is from the line of Tobey Sommer with <unk> Securities.
Thank you.
And as for you about the book to Bill.
On a long time ago decade, or more ago with very good modeling tool to.
Forecast future revenue growth and that.
Relationship has sort of been decoupled, not just us but seemingly the group.
Do you use that and Youre planning and forecasting so that so the week and utilized in the quarter was a very robust number seemingly and use it to forecast more accurately.
Yes so.
Youre absolutely right book to Bill is an indicator and it's a reasonable leading indicator.
2 ticket of assessment of the bookings you are bringing in and certainly as you as you dissect. It it can be informative as you think about the periods of performance and things like that but it is not it is not a dollar for dollar indicator around future growth and so.
And so we do pay attention to it obviously and we report on it we look we look to it but there is things like the period of performance on very sizable contract can can absolutely move your book to Bill and a very material way and we've seen some of that and some of our bookings, especially on <unk>, where they've been longer.
But it doesn't necessarily have a direct correlation on a growth rate so.
Totally agree with your assessment it is something we pay attention to as an indicator but.
Until you layer and all your contracts and your backlog and and the roll off. It really is just part of that analysis that gets done and we're very pleased with our book to Bill running running very strong the last last year and we've got a very strong pipeline as you've heard and have good confidence and our ability to sustain strong book to bill.
But again it is an indicator certainly not the indicator.
And could I get a sense.
For what the margin profile looks like in sort of the bid pipeline and in recent wins, including the AAM com.
And.
Recompete wins and I, just wanted to try to be able to use that color to inform the margin outlook going forward. Thank you.
Yes.
Here Tobey, so I'd say the margin rate implied in the pipeline and importantly, and the way we think about the business here.
And it really is in line with where the business is right now having said that we are always striving to create differentiation in what we're bidding such that we continue to move up from margin rate curve as we bid new work and especially with new work that has a development period associated with it.
I think we tend to see lower rates early on and the program and the period of performance and we start to ramp over the period of performance. So we think about and over the life of the contract, but I would say directly to your question I'd say, we would expect sort of our <unk>.
Pipeline and our BD efforts to be continuously driving upstream on margin rate. So we're taking on more accretive work as we go on.
Thank you.
Again star 1 if you'd like to ask a question. Your next question is from the line of Seth Eastman with J P. Morgan.
Okay. Thanks, very much good afternoon, everyone.
Net.
I was wondering if you could talk about.
And what level of exposure debt.
You have to Afghanistan, that's baked into your baked into the guidance for the year.
Yes, we have very minimal exposure and Afghanistan. So nothing.
<unk>.
Okay. Okay. Okay.
Right.
And then when you.
Look at the pipeline for the remainder of the year I guess, we just see.
A reasonable opportunity.
And putting aside the acquisition and reasonable opportunities to exit the year with.
And with a larger backlog and then you have right now.
Yes.
Yes, I would agree with that assessment, we have a very strong pipeline.
We have.
We've secured decent strong win rates and we've got a good combination of recompete as well as new business. So I would agree with your assessment.
Great. Thanks very much.
Thank you Seth.
Your next question is from Milan, David Strauss with Barclays.
Thanks, Good afternoon and David.
So I know, it's still early days here and we've done and goes through the markup process, but could.
Could you comment a little bit on how the budget looks for for you all I guess both from my.
Perspective, and a simple agency perspective.
Yes.
As you noted it is early days for certain.
And we see you pay attention to the request that are that are being put forward and the conversation and I would say at this juncture, we don't see any material impact on on our business from the budget and we certainly see some positive trends as an example, the continued focus on and it modernization and some of the work that it's being accelerated across the federal government and that arena. We believe is a positive.
Sign for us.
And and certainly the conversation around O&M. We believe is a positive positive indicator for SAIC, but at this juncture. It is still as you said very early and we're not seeing anything that has a material impact.
Okay.
And probably low.
I guess a question Gabe.
Given the deal.
Could you talk or can you give us kind of how we should expect day.
Deleveraging and go from here I think your prior target was 3 times at the end of the year and.
And what does that what does that do for your outlook from a from a share repurchase standpoint.
Yes, so thanks for the question.
David I'd say at this point.
We don't see.
Material impact to our ability to continue to be and the market to buy shares.
We are committed to getting our leverage ratio to about 3 times, I'd say and a low interest rate environment, we're comfortable running debt leverage ratio a little bit higher as needed as.
As we mentioned this particular acquisition increases our leverage by <unk> of a turn.
And it's incredibly cheap debt as I mentioned, so I would say pretty comfortable running at where it is right now I think in terms of just the plan to de lever I'd say, we've notionally gift to that roughly 3 X sometime in FY 'twenty 3.
And.
And no better way to do it and to grow earnings quickly. So we're certainly committed to getting there, but I would say probably sometime in the second half of FY 'twenty 3.
Okay and last 1 I had the debt 10% of revenues that I think you talked about.
Last quarter that were up for Recompete This year, where does that percentage stand now.
It's a little bit lower now.
Say theres, 1 recompete, that's out there and thats still pretty material.
NASA and next we call at NASA Aegis, now and that is expected to be.
Hey.
I will have more clarity and the summer timeframe on that 1 and and that's the FY 'twenty to look for this year.
Alright, thanks very much okay. Thank you.
You have a follow up question from Gavin Parsons with Goldman Sachs.
Alright. Thanks.
Just wanted to ask on <unk>.
Right on the 3 contracts used to talk about all the time Eas Cte and FSD.
Are those at full run rate of those wrapped up or are those still contributing growth drivers.
I think at this juncture, they're all ramping up and.
And on track to do exactly that I don't think they are at full capacity yet.
Okay, Great and then probably you mentioned the guidance on the second half depends on the ramp up on the run rate of STI and risks.
There is.
And the contracts that I mentioned before had been a dynamic and the slippage to the right.
Is there any cushion in there for that or.
And good amount of confidence and the pace of the ramp up on this.
Yes, it's a good question Gavin and I mean, the way, we really do think about the planned process has to be thoughtful about the things that will require a ramp, especially if there is a lot of hiring and place we want to make sure that we have a plan that we can execute starting from day, 1 and so I would say we've fairly encapsulated the range of possibilities around the ramp.
<unk> for these programs and are therefore comfortable with the way were scheduled it out for the rest of the year.
Okay. Thanks again.
Your next question is from the line of Cai von <unk>, and I am not sure and know how to pronounce your last name with Cowen.
Okay. Good.
Good try thanks.
No.
Apologize joining a little bit late but.
So could you if you gave it could you give again bids.
<unk> decision.
The $18.2 billion Sky.
$18.2 billion. Thank you very much Allen lindstrom from year end, but thats, because we had in Q1, yeah exactly exactly and then a number of folks.
Last quarter basically sort of complained about.
Transitioning to the administration and kind of delayed bookings.
And obviously you had good bookings.
What are you seeing for the next.
For the next 2 quarters are we going to have like a super low.
And I'll show, we're going to see the normal seasonal.
Pick up what should we look for.
Yes.
But we're seeing today is really just a normal environment and we're not saying any anything thats overly flow or or anything thats overly aggressive. So we're seeing a normal cadence of rfps bid processes and have awards and our space and our customers.
If I look at history normal would say comfortably above 1 and Q2 and Q3, yes.
Well, we're not I'm not going to give guidance on a book to Bill we're very pleased with the bookings and the book to Bill that we've been able to appreciate this last 4 quarters and.
And then actually before that we're very very pleased with where we sit today I'm very pleased with the performance of the organization on business development and pursuing bids as we all know book to Bill is lumpy and so.
It's very hard to predict anything at the quarter level, because it really becomes a.
The outcome of our customers' decision on schedule, but I will tell you that as we look at the pipeline as we look at the submissions as we look at our past performance that I'm comfortable with our ability to maintain a strong book to bill going forward.
Great and then could you comment on protest specifically I think you had <unk>.
For contracts you launched towards the end of the year and 2 of those were in protest.
Did you win those protests and do you have any other.
<unk> either on the offensive or the defensive side.
So I'd say nothing unusual there was 1 where the protest was sustained.
It's back into a cycle.
Competition again, I'd say, we're just watching this with everybody else, but I'd say, that's probably the only update we have since here and 1 of them where the protest was sustained.
Thank you very much.
Okay.
And I would like to turn it back over to the company for any closing remarks.
Thank you very much for your participation and Saic's first quarter fiscal year 2022 earnings call. This concludes the call and we thank you for your continued interest and SAIC.