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 its financial and operating results for the second quarter ended June 30, 2013.
Second quarter 2013 revenue exceeded the midpoint of management’s guidance range issued last quarter; diluted earnings per share (EPS) exceeded the high end of guidance by $0.02.
Second Quarter 2013 Results
For the three months ended June 30, 2013, revenue decreased by 9.0%, or $8.2 million, from the same period a year ago to $83.0 million. The decrease resulted primarily from the expiration of task orders and contracts; reductions in scope of work, including $3.8 million from NCI’s PEO Soldier contract; and funding shortfalls as a result of customers’ budgetary constraints. The year-over-year decrease was partially offset by revenue from new contracts and task orders. NCI’s PEO Soldier contract accounted for 13.9% of revenue compared with 16.8% of revenue for the same period during 2012.
General and administrative expenses decreased 3.4%, or $0.2 million, for the three months ended June 30, 2013, compared with the same period a year ago. During the second quarter, NCI’s continued investment in business development was more than offset by reduced personnel costs in other areas.
Operating income for the second quarter of 2013 was $3.3 million, up from $2.8 million for the second quarter of 2012. Operating margin for the second quarter of 2013 was 4.0% compared with operating margin of 3.1% for the second quarter of 2012. Operating margin for the second quarter of 2013 increased due to improved contract performance, reduced overhead and general and administrative expenses, and lower depreciation and amortization.
Net income for the second quarter of 2013 increased to $1.8 million from $1.5 million in the second quarter of 2012. The increase in net income year over year is attributable to the factors affecting operating income and lower interest expense, offset partially by an increase in income taxes and a higher effective income tax rate. Diluted EPS for the second quarter of 2013 was $0.14 compared with $0.11 in the second quarter of 2012.