Document
false0000892537 0000892537 2020-11-05 2020-11-05


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 
__________________

FORM 8-K
___________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 5, 2020
__________________________________________

ManTech International Corporation
(Exact name of registrant as specified in its charter) 
__________________________________________
Delaware
000-49604
22-1852179
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
2251 Corporate Park Drive
Herndon
Virginia
20171
(Address of principal executive offices)
 
 
(Zip Code)
Registrant's telephone number, including area code: (703) 218-6000

(Former name or former address, if changed since last report.)
__________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Class A Common Stock
MANT
Nasdaq

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§203.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.





Item 2.02    Results of Operations and Financial Condition;
Item 7.01    Regulation FD Disclosure;
Item 8.01    Other Events
On November 5, 2020, ManTech International Corporation announced its financial results for the fiscal quarter ended September 30, 2020, and provided updated financial guidance for fiscal year 2020 (the "Earnings Release"). ManTech also announced the declaration of a quarterly cash dividend payment to its stockholders. A dividend of $0.32 per share will be paid on December 18, 2020 to stockholders of record as of the close of business on December 4, 2020. Any future declarations of dividend payments are subject to the determination and approval of the Board of Directors.
A copy of the Earnings Release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
Item 9.01    Financial Statements and Exhibits
(d) Exhibits
Exhibit
No.
Description of Exhibit
104
Cover Page Interactive Data File (embedded in the Inline XBRL document).





SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
MANTECH INTERNATIONAL CORPORATION
 
 
 
 
 
 
By:
/s/    Michael R. Putnam
Date:
November 5, 2020
Name:
Michael R. Putnam
 
 
Title:
Senior VP - Corporate & Regulatory Affairs












Exhibit




Exhibit 99.1
ManTech Announces Financial Results for
Third Quarter of 2020

Revenue: $636 million, up 10% from the third quarter of 2019
EBITDA Margin: 9.0%
Diluted EPS: $0.73, up 6% from the third quarter of 2019
Adjusted Diluted EPS: $0.83, up 6% from the third quarter of 2019
Bookings of $1.3 billion resulting in a book-to-bill ratio of 2.1
Cash Flow from Operations: $112 million
Raises and narrows the range of 2020 guidance on all measures

HERNDON, Va., November 5, 2020 (GLOBE NEWSWIRE) – ManTech International Corporation (Nasdaq:MANT), a leading provider of innovative technologies and solutions for mission-critical national security programs, today announced financial results for the third quarter of fiscal year 2020, which ended September 30, 2020.

"We are pleased with the results we achieved in the third quarter, which included continued strong organic growth, solid profitability and robust cash flow," said ManTech Chairman, Chief Executive Officer and President Kevin M. Phillips. "These results reflect broad-based and steady customer demand for our differentiated capabilities in cyber, analytics and intelligent systems engineering. Our ability to consistently deliver innovation and mission-critical solutions to our customers continues to be the foundation for our success. We are committed to building on this momentum to drive continued growth."

Summary Operating Results
 
Three months ended
September 30,
(In Millions Except Per Share Amounts)
2020
 
2019
Revenue
$636.2
 
$579.2
Operating Income
$39.3
 
$38.4
Net Income
$29.7
 
$27.9
Diluted EPS
$0.73
 
$0.69
 
Non-GAAP Financial Measures*
EBITDA
$57.5
 
$52.2
EBITDA Margin
9.0%
 
9.0%
Adjusted Net Income
$33.6
 
$31.6
Adjusted Diluted EPS
$0.83
 
$0.78
*Information about ManTech's use of non-GAAP financial measures, including a reconciliation of the non-GAAP financial measures to the most comparable financial measures calculated and presented in accordance with GAAP, is provided under "Non-GAAP Financial Measures."

Revenue was $636 million, up 10% from the third quarter of 2019. In the quarter, revenue growth was almost all organically driven as a result of recent contract awards.

Operating income was $39.3 million for the quarter, up 2% from the third quarter of 2019. Net income was $29.7 million and diluted earnings per share ("EPS") was $0.73, both up 6% from the third quarter of 2019.

Page 1





EBITDA was $57.5 million for the quarter, up 10% from the third quarter of 2019, representing an EBITDA margin of 9.0% for the quarter. Adjusted net income was $33.6 million and adjusted diluted EPS was $0.83, up 7% and 6% from the third quarter of 2019, respectively.

Cash Management and Capital Deployment

For the quarter, cash flow from operations totaled $112 million. Days sales outstanding (DSO) were 54 days, an improvement of 3 days compared to the third quarter of 2019.

During the quarter, the Company paid $12.9 million, or $0.32 per share, as part of its regular cash dividend program to its common stockholders of record as of September 11, 2020. As of September 30, 2020, the Company had $101.7 million in cash and cash equivalents and no outstanding borrowings on its $500 million revolving-credit facility, which provides the Company with ample financial capacity to continue funding organic investments, pursue growth-oriented acquisitions and issue dividends while maintaining a strong balance sheet.

The Board of Directors has declared a quarterly dividend of $0.32 to be paid December 18, 2020, to all common stockholders of record as of December 4, 2020, as part of its regular quarterly cash dividend program. Future declarations of dividends and their record and payment dates are subject to the final determination of ManTech's Board of Directors.

Contract Awards

Contract awards (bookings) totaled $1.3 billion in the quarter, representing a book-to-bill ratio of 2.1. ManTech's notable single-award contracts in the quarter include:

Data Analytics Solutions and Services for the Department of Homeland Security. ManTech was awarded a 6-year contract totaling $273 million to continue providing advanced analytics tools and technologies to enhance Customs and Border Protection's (CBP) ability to identify and analyze threats to the homeland.

Full-Spectrum Cyber Operations for an agency of the Department of Defense. ManTech was awarded a new, approximately 3.5-year contract totaling $266 million to provide full-spectrum cyber operations solutions.

Quick-Reaction Analysis and Intelligent Systems Engineering for the Navy. ManTech was awarded a 5-year contract totaling $260 million to continue to support the Naval Air Systems Command's (NAVAIR) technology modernization initiatives to transform mission systems in manned maritime patrol and reconnaissance aircraft.

Threat and Risk Analysis and Technical Security Countermeasures for the Department of State. ManTech was awarded a $121 million contract expansion to provide additional services to safeguard personnel globally supporting the Department of State's mission.

Operational Test, Engineering Services and Cyber Research for the Navy. ManTech was awarded a new, 5-year contract totaling $85 million to provide hardware and software operational test, engineering and cyber research on newly developed and fielded sensors across NAVAIR platforms.

Page 2





The Company also received a number of additional contract awards in the quarter including several extensions to existing contracts and new contracts from various customers, most of which are classified.

The Company’s backlog of business at quarter end was a new record of $9.8 billion including $1.4 billion of funded backlog.

Forward Guidance

The Company has raised and narrowed the range of its 2020 guidance for revenue, adjusted net income and adjusted diluted earnings per share as specified in the table below.

Measure
Fiscal 2020 Guidance
Revenue (million)
$2,490 - $2,510
Adjusted Net Income* (million)
$131.6 - $133.2
Adjusted Diluted EPS*
$3.24 - $3.28
*Information about ManTech's use of non-GAAP financial measures is provided under "Non-GAAP Financial Measures"


Adjusted net income and adjusted diluted EPS exclude amortization of acquired intangibles and the related tax impact. The Company does not provide a reconciliation of forward-looking adjusted net income and adjusted diluted EPS, due to inherent difficulty in forecasting and quantifying these non-GAAP exclusions that are necessary for such reconciliation without unreasonable efforts. Material changes to any one of these items could have significant effect on future GAAP results.

ManTech Chief Financial Officer Judith L. Bjornaas said, "Despite managing through the complexities posed by the pandemic, we have built upon our track record of outperformance. We are focused on a strong finish to the year and look forward to continuing to drive strong results into next year."

Conference Call

ManTech executive management will hold a conference call on November 5, 2020, at 5 p.m. Eastern to discuss the financial results and outlook and answer questions. Analysts may participate on the conference call by dialing (877) 638-9567 (domestic) or (253) 237-1032 (international) and entering passcode 8546935. The conference call will be webcast simultaneously to the public through a link on the Investor Relations section of the ManTech website (http://investor.mantech.com). A replay of the conference call will be available on the ManTech website approximately 2 hours after the conclusion of the conference call.

About ManTech International Corporation

ManTech provides mission-focused technology solutions and services for U.S. defense, intelligence community and federal civilian agencies. In business more than 50 years, we excel in full-spectrum cyber, data collection & analytics, enterprise IT, systems and software engineering solutions that support national and homeland security. Additional information about ManTech can be found at www.mantech.com.



Page 3




Forward-Looking Information

Statements and assumptions made in this press release, which do not address historical facts, constitute “forward-looking” statements that ManTech believes to be within the definition in the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties, many of which are outside of our control. Words such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,” or “estimate,” or the negative of these terms or words of similar import, are intended to identify forward-looking statements.

These forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes we anticipate. Factors that could cause actual results to differ materially from the results we anticipate include, but are not limited to, the following: failure to maintain our relationship with the U.S. government, or the failure to compete effectively for new contract awards or to retain existing U.S. government contracts; disruptions to our business resulting from the recent outbreak of the novel coronavirus disease 2019 (known as COVID-19) or other similar global health epidemics, pandemics and/or other disease outbreaks; adverse changes in U.S. government spending for programs we support, whether due to changing mission priorities, economic and political policy changes or federal budget constraints generally; inability to recruit and retain a sufficient number of employees with specialized skill sets or necessary security clearances who are in great demand and limited supply; failure compete effectively for awards procured through the competitive bidding process, and the adverse impact of delays resulting from our competitors' protest of new contracts that are awarded to us; disruptions of our business or damage to our reputation resulting from cyber attacks and other security threats; failure to obtain option awards, task orders or funding under contracts; the government renegotiating, modifying or terminating of our contracts; failure to comply with, or adverse change in, complex U.S. government laws and procurement; adverse results in U.S. government audits or other investigations of our government contracts; failure to successfully integrate acquired companies or businesses into our operations or to realize any accretive or synergistic effects from such acquisitions; failure to mitigate risk associated with conducting business internationally; and adverse change in business conditions that may cause our investments in recorded goodwill to become impaired. These and other risk factors are more fully discussed in the section entitled "Risk Factors" in ManTech's Annual Report on Form 10-K previously filed with the Securities and Exchange Commission on Feb. 22, 2019, Item 1A of Part II of our Quarterly Reports on Form 10-Q, and, from time to time, in ManTech's other filings with the Securities and Exchange Commission.

The forward-looking statements included herein are only made as of the date of this press release, and ManTech undertakes no obligation to publicly update any of the forward-looking statements made herein, whether as a result of new information, subsequent events or circumstances, changes in expectations or otherwise.


Page 4




MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share and Per Share Amounts)
 
(unaudited)
 
September 30,
2020
 
December 31,
2019
ASSETS
 
 
 
Cash and cash equivalents
$
101,712

 
$
8,854

Receivables—net
382,855

 
398,976

Prepaid expenses
27,868

 
20,030

Taxes receivable—current
27,821

 
21,996

Other current assets
6,663

 
4,878

Total Current Assets
546,919

 
454,734

Goodwill
1,191,270

 
1,191,259

Other intangible assets—net
180,600

 
196,778

Property and equipment—net
116,548

 
85,631

Operating lease right of use assets
99,784

 
117,728

Employee supplemental savings plan assets
34,682

 
36,777

Investments
11,549

 
11,550

Other assets
13,096

 
13,457

TOTAL ASSETS
$
2,194,448

 
$
2,107,914

LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
LIABILITIES
 
 
 
Accounts payable and accrued expenses
$
170,500

 
$
146,016

Accrued salaries and related expenses
127,110

 
97,298

Contract liabilities
40,058

 
27,620

Operating lease obligations—current
30,235

 
29,047

Total Current Liabilities
367,903

 
299,981

Deferred income taxes
142,909

 
131,782

Operating lease obligations—long term
86,317

 
103,148

Accrued retirement
33,224

 
35,552

Long term debt

 
36,500

Other long-term liabilities
10,379

 
10,309

TOTAL LIABILITIES
640,732

 
617,272

COMMITMENTS AND CONTINGENCIES
 
 
 
STOCKHOLDERS' EQUITY
 
 
 
Common stock, Class A—$0.01 par value; 150,000,000 shares authorized; 27,417,760 and 27,235,860 shares issued at September 30, 2020 and December 31, 2019; 27,173,647 and 26,991,747 shares outstanding at September 30, 2020 and December 31, 2019
274

 
272

Common stock, Class B—$0.01 par value; 50,000,000 shares authorized; 13,187,195 and 13,187,195 shares issued and outstanding at September 30, 2020 and December 31, 2019
132

 
132

Additional paid-in capital
539,286

 
525,851

Treasury stock, 244,113 and 244,113 shares at cost at September 30, 2020 and December 31, 2019
(9,158
)
 
(9,158
)
Retained earnings
1,023,448

 
973,767

Accumulated other comprehensive loss
(266
)
 
(222
)
TOTAL STOCKHOLDERS' EQUITY
1,553,716

 
1,490,642

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$
2,194,448

 
$
2,107,914


Page 5




MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
 
(unaudited)
Three months ended
September 30,
 
(unaudited)
Nine months ended
September 30,
 
2020
 
2019
 
2020
 
2019
REVENUE
$
636,196

 
$
579,179

 
$
1,879,600

 
$
1,618,146

Cost of services
538,000

 
487,914

 
1,597,764

 
1,378,263

General and administrative expenses
58,855

 
52,863

 
164,011

 
139,652

OPERATING INCOME
39,341

 
38,402

 
117,825

 
100,231

Interest expense
(310
)
 
(659
)
 
(1,597
)
 
(2,088
)
Interest income
40

 
90

 
227

 
401

Other (expense), net
(29
)
 
(39
)
 
(51
)
 
(50
)
INCOME FROM OPERATIONS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS
39,042

 
37,794

 
116,404

 
98,494

Provision for income taxes
(9,303
)
 
(9,873
)
 
(28,037
)
 
(25,229
)
Equity in earnings (losses) of unconsolidated subsidiaries

 
16

 
(1
)
 
4

NET INCOME
$
29,739

 
$
27,937

 
$
88,366

 
$
73,269

BASIC EARNINGS PER SHARE:
 
 
 
 
 
 
 
Class A common stock
$
0.74

 
$
0.70

 
$
2.19

 
$
1.84

Class B common stock
$
0.74

 
$
0.70

 
$
2.19

 
$
1.84

DILUTED EARNINGS PER SHARE:
 
 
 
 
 
 
 
Class A common stock
$
0.73

 
$
0.69

 
$
2.18

 
$
1.82

Class B common stock
$
0.73

 
$
0.69

 
$
2.18

 
$
1.82



Page 6




MANTECH INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
 
(unaudited)
Nine months ended
September 30,
 
2020
 
2019
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES:
 
 
 
Net income
$
88,366

 
$
73,269

Adjustments to reconcile net income to net cash flow from (used in) operating activities:
 
 
 
Depreciation and amortization
51,281

 
39,470

Noncash lease expense
20,738

 
20,949

Deferred income taxes
11,127

 
9,773

Stock-based compensation expense
8,533

 
5,188

Bad debt expense
5,244

 

Contract loss reserve
(372
)
 
(881
)
Loss on sale and retirement of property and equipment
12

 
7

Equity in (earnings) losses of unconsolidated subsidiaries
1

 
(4
)
Change in assets and liabilities—net of effects from acquired businesses:
 
 
 
Receivables—net
10,877

 
60,182

Prepaid expenses
(7,838
)
 
(5,609
)
Taxes receivable—current
(5,825
)
 
(1,653
)
Other current assets
(1,333
)
 
586

Employee supplemental savings plan asset
(2,042
)
 
(4,396
)
Other long-term assets
(1,939
)
 
40

Accounts payable and accrued expenses
22,565

 
28,888

Accrued salaries and related expenses
29,812

 
9,830

Operating lease obligations
(22,102
)
 
(21,077
)
Contract liabilities
12,438

 
15,682

Accrued retirement
(2,328
)
 
2,655

Other long-term liabilities
100

 
273

Other
(182
)
 
(213
)
Net cash flow from operating activities
217,133

 
232,959

CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:
 
 
 
Purchases of property and equipment
(53,685
)
 
(38,455
)
Investment in capitalized software
(5,193
)
 
(2,784
)
Proceeds from corporate owned life insurance
4,137

 

Proceeds from sale of property and equipment
869

 

Acquisition of a business-net of cash acquired

 
(153,180
)
Deferred contract costs

 
(3,520
)
Proceeds from equity method investment

 
283

Net cash used in investing activities
(53,872
)
 
(197,656
)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:
 
 
 
Borrowing under revolving credit facility
285,500

 
465,500

Repayments under revolving credit facility
(322,000
)
 
(448,000
)
Dividends paid
(38,689
)
 
(32,365
)
Proceeds from exercise of stock options
5,918

 
9,156

Payment consideration to tax authority on employees' behalf
(1,014
)
 
(1,476
)
Principal paid on financing leases
(118
)
 
(99
)
Net cash used in financing activities
(70,403
)
 
(7,284
)
NET CHANGE IN CASH AND CASH EQUIVALENTS
92,858

 
28,019

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
8,854

 
5,294

CASH AND CASH EQUIVALENTS, END OF PERIOD
$
101,712

 
$
33,313



Page 7




Non-GAAP Financial Measures (Unaudited)

To supplement the review of ManTech's consolidated financial statements presented on a GAAP basis, the Company has provided non-GAAP calculations of certain financial measures. ManTech uses and refers to EBITDA, EBITDA margin, adjusted net income and adjusted EPS, all of which are non-GAAP financial measures. These non-GAAP financial measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for the comparable GAAP measures.

ManTech’s management believes that these non-GAAP financial measures provide additional useful information regarding the Company’s operational and financial results. These non-GAAP financial measures eliminate the effect of non-cash items such as depreciation of tangible assets and amortization of intangible assets primarily recognized in business combinations as well as the effect of discrete tax items which we do not believe are indicative of our core operating performance. These non-GAAP financial measures are considered important and frequently utilized by investors and financial analysts covering ManTech’s industry. The Company’s computation of its non-GAAP financial measures may not be comparable to similarly titled measures reported by other companies, thus limiting their use for comparability.

The following tables present selected financial data, including the reconciliation of the non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP.

EBITDA is calculated by excluding depreciation and amortization expense, interest expense, interest income, other expense, income taxes and equity in losses of unconsolidated subsidiaries from net income.

EBITDA margin is calculated by dividing EBITDA by revenue.


Three months ended
September 30,
(In Thousands)
2020

2019
NET INCOME
$
29,739


$
27,937

Equity in losses (earnings) of unconsolidated subsidiaries


(16
)
Provision for income taxes
9,303


9,873

INCOME FROM OPERATIONS BEFORE INCOME TAXES AND EQUITY METHOD INVESTMENTS
$
39,042


$
37,794

Other expense (income), net
29


39

Interest income
(40
)

(90
)
Interest expense
310


659

Depreciation and amortization
18,127


13,840

EBITDA
$
57,468


$
52,242

EBITDA Margin
9.0
%

9.0
%




Page 8





Adjusted net income is calculated by excluding the following items and the related tax impacts from net income: (i) amortization of acquired intangible assets and (ii) discrete tax items.

Adjusted diluted EPS is calculated by dividing adjusted net income by the diluted weighted average number of shares outstanding.
 
Three months ended
September 30,
(In Thousands Except Per Share Amounts)
2020
 
2019
NET INCOME
$
29,739

 
$
27,937

Amortization of acquired intangibles
5,130

 
4,912

Adjustments for tax effect
(1,221
)
 
(1,282
)
ADJUSTED NET INCOME
$
33,648

 
$
31,567

 
 
 
 
ADJUSTED DILUTED EPS
 
 
 
Class A common stock
$
0.83

 
$
0.78

Class B common stock
$
0.83

 
$
0.78

Note: Figures may not add due to rounding.



Page 9





Investor Relations
Media
Stephen Vather
Sheila Blackwell
VP, M&A and Investor Relations
VP, Enterprise Marketing & Communications
(703) 218-6093
(301) 717-7345
Stephen.Vather@ManTech.com
Sheila.Blackwell@ManTech.com



Page 10
v3.20.2
Document and Entity Information Document
Nov. 05, 2020
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 05, 2020
Entity Registrant Name ManTech International Corporation
Entity Incorporation, State or Country Code DE
Entity File Number 000-49604
Entity Tax Identification Number 22-1852179
Entity Address, Address Line One 2251 Corporate Park Drive
Entity Address, City or Town Herndon
Entity Address, State or Province VA
Entity Address, Postal Zip Code 20171
City Area Code 703
Local Phone Number 218-6000
Title of 12(b) Security Class A Common Stock
Trading Symbol MANT
Security Exchange Name NASDAQ
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0000892537