In the 12 months to January 31, 2003, the San Diego, California-based company increased its net profit 120% to $246m from $18.9m in the previous year, on revenue that grew 2% to $5.9bn. Sales to clients in the government sector increased 12% on the back of new contract wins with the US’ Defense Information Systems Agency and the Department of Interior.
SAIC’s revenue from the commercial sector was down 3%, which it blamed on reduced spending on outsourcing initiatives by clients in the energy sector, despite a four-year, $360m infrastructure management deal with oil giant BP at its Houston facilities. Overall, SAIC secured contracts worth $8.4bn last year.
SAIC benefited from a fall in impairment losses relating to its investments which included security venture VeriSign Inc, which dropped to $134m in 2003/2003, from $455.8m in the previous year. The company liquidated its investments in VeriSign, and billing applications vendor Amdocs Ltd last year for gross proceeds of $631m, which reduced the value of SAIC’s investment portfolio to $128m compared to $1bn at the end of fiscal 2002.
The impact of these investment charges was most evident in the fourth quarter, where SAIC made a net profit of $81m compared to a year-ago loss of $158m. Revenue grew 5.5% to $1.54bn during the quarter. The company also benefited from several acquisitions it made during 2003, which included Arthur Andersen’s North American Oil and Gas consulting practice and defense sector-focused services outfit Scientech Inc.
