NCI, Inc. (NASDAQ:NCIT), a leading provider of information technology (IT), engineering, logistics, and professional services and solutions to U.S. Federal Government agencies, today announced financial and operating results for the fourth quarter and fiscal year ended December 31, 2012.
Fourth quarter and fiscal year 2012 revenue was in the upper half of management’s guidance range issued last quarter; diluted EPS—excluding the non-cash, after-tax impairment charges—exceeded the high end of guidance by $0.03.
Fourth Quarter 2012 Results
For the fourth quarter of 2012, NCI reported revenue of $89.7 million compared with fourth quarter 2011 revenue of $114.8 million, a decrease of 21.9%. The year-over-year decrease in revenue was the result of reductions of scope, the expiration of task orders and contracts, and certain lost contract re-competes, which totaled approximately $14 million; the ending of base realignment and closure (BRAC)-related and other non-core projects, which collectively totaled approximately $7 million; and a decrease in revenue from NCI’s PEO Soldier program, which accounted for approximately $4 million of the year-over-year decline in revenue for the fourth quarter of 2012. During the fourth quarter of 2012, PEO Soldier accounted for 15.9% of total revenue, down from 16.3% sequentially and 16.2% in the fourth quarter of 2011.
As previously disclosed, during the fourth quarter of 2012, in accordance with the NCI’s annual testing and due to its further depressed market value, the continued budgetary constraints of various Federal Government agencies, and the ongoing delays of expected contract procurement opportunities, the company performed a goodwill impairment analysis as well as a review of intangible assets. The results of this analysis indicated that the remaining balance of the company’s goodwill and a portion of its intangible assets were impaired; accordingly, the company recorded an impairment charge totaling $58.0 million ($36.7 million after tax) in the fourth quarter of 2012.