SM&A Warns of Revenue Shortfall

Business strategy consultant SM&A (WINS Quote) warned late Monday of a sharp revenue shortfall that the company blamed on the war in Iraq.

The Newport Beach, Calif., proposal development concern forecast third-quarter revenue of $15 million and full-year revenue of around $67.5 million. Those figures are far short of the Wall Street consensus estimate: The Thomson First Call analyst consensus calls for third-quarter revenue of $21.6 million and fiscal 2004 revenue of $82 million.

"It has been a very unusual year for us, as this is the first time in our 22-year history that the federal government has funded a prolonged military action leading to both [requests for proposals] and program delays," said CEO Steven Myers. "In 2004, we have experienced more delays than we have experienced in the past several years. While our short-term performance has been affected by events in which we have no direct control, such as the prolonged military action and the upcoming presidential election, our long-term prospects are strong."

The company expects to post third-quarter numbers after the market closes Oct. 18. On Monday, SM&A slipped 4 cents to $8.25.