Perspecta Inc. (NYSE:PRSP) Q4 2020 Earnings Conference Call - Final Transcript

May 21, 2020 • 05:00 pm ET

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Perspecta Inc. (NYSE:PRSP) Q4 2020 Earnings Conference Call - Final Transcript

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Presentation
Executive
John Kavanaugh

purchase price of $53 million, subject to customary closing price adjustments. The acquisition should contribute roughly $70 million to FY '21 revenue as a cost-plus margin profile and will be slightly accretive to EPS. The EBITDA multiple paid is similar to our own.

We expect revenue for the year to be $4.26 billion to $4.41 billion, adjusted EBITDA margin of 15% to 16%, adjusted diluted earnings per share of $1.90 to $2.03 and adjusted free cash flow conversion of 100% plus of adjusted net income. Excluding the estimated impact of NGEN, revenue for the year would be $3.66 billion to $3.81 billion, adjusted EBITDA margin of 15.5% to 16.5%, adjusted diluted earnings per share of $1.60 to $1.73 and adjusted free cash flow conversion of 100% plus. In our appendix, you will find a slide bridging FY '20 as-reported results to these figures. Implicit in our guidance is the assumption of an effective tax rate of 25% as we continue to drive tax planning initiatives.

Finally, the Board of Directors has approved a $0.01 increase per share to our quarterly dividend, which translates to an additional $6 million in annual dividend payments.

On Slide 10, we are providing updated three-year targets for FY '22 through FY '24 anchored off FY '21 excluding NGEN SMIT. We have targeted a 4% to 6% organic revenue CAGR, 15% to 16% margin range for adjusted EBITDA, and 8% to 12% adjusted diluted EPS CAGR, and adjusted free cash flow conversion of 100% plus. These figures all exclude the impact of NGEN SMIT and provides you more visibility into the strength and trajectory of our ongoing business. We are confident that with our talented workforce, robust pipeline, suite of capabilities, and strong foundation, we can deliver on our long term financial targets. Operator, we are now ready to take any questions.