PARSONS CORP (NYSE:PSN) Q1 2019 Earnings Conference Call - Final Transcript

Jun 18, 2019 • 08:00 am ET


PARSONS CORP (NYSE:PSN) Q1 2019 Earnings Conference Call - Final Transcript


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Good morning. My name is Jack, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Parsons First Quarter 2019 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions)

Thank you. Dave Spille, Vice President of Investor Relations. You may begin your conference.

Dave Spille

Thank you. Good morning, and thank you for joining us today to discuss our first quarter 2019 financial result. Please note that we provided a presentation slides on the Investor Relations section of our website.

On the call with me today are Chuck Harrington, Chairman and CEO; George Ball, CFO; and Carey Smith, Chief Operating Officer. Today, Chuck, will discuss execution against our corporate strategy; George, will provide an overview of our first quarter financial results; and then Carey, will review our operational highlights. We then will close with a question-and-answer session.

Management may also make forward-looking statements during the call regarding future events, anticipated future trends, and the anticipated future performance of the Company. We caution you that such statements are not guarantees of future performance, and involve risks and uncertainty that are difficult to predict.

Actual results may differ materially from those projected in the forward-looking statements due to a variety of factors. These factors are described in a Registration Statement on Form S-1, and other SEC filings. Please refer to our earnings press release for Parsons' complete forward-looking statement disclosure. We do not undertake any obligation to update forward-looking statements.

Management will also make reference to non-GAAP financial measures during this call, and we remind you that these non-GAAP financial measures are not a substitute for their comparable GAAP measures.

I now will turn the call over to Chuck.

Charles L. Harrington

Thank you, Dave. Welcome to all, who are on the line to Parsons' first quarter 2019 earnings call. We had a strong quarter across both business segments, and our Q1 results reflect the success of executing on our Enhance, Extend, Transform strategy.

Financially, we delivered a strong quarter -- first quarter results, which included notable increases in revenue, profitability, and contract awards over the first quarter of 2018. In fact, our revenue grew 20%; our adjusted EBITDA grew 43%, and included a 120 basis point margin improvement. Total backlog increased 35%, now stands at $8.6 billion on the strength of a 1.4 book-to-bill ratio. And our Federal Solutions revenue contribution increased to 47% of the corporate total in the quarter from 39% in the prior year.

Strategically, we closed on a key acquisition OGSystems, and as you know, recently completed our IPO. Our performance has benefited from our strategy to enhanced organic operations through strategic leadership additions, technology R&D efforts, and focusing our sales on a higher margin, lower working capital markets.

Simultaneously, we've also executed our Extend strategy to enter the geospatial intelligence, cloud computing, and small satellite markets, while expanding our revenue in cyber, intelligence, missile defense and