Yahoo Finance Kratos Defense (KTOS) Q4 Earnings Beat, Revenues Up Y/Y
Kratos Defense & Security Solutions, Inc.’s KTOS shares have risen 10.3% to $12.65 since the company released its fourth-quarter 2022 results.
Kratos Defense reported fourth-quarter 2022 adjusted earnings of 8 cents per share, down 27.3% from 11 cents reported in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate of 7 cents by 14.3%.
The company reported GAAP loss of 7 cents per share compared with a loss of 2 cents in the fourth quarter of 2021.
For full-year 2022, KTOS reported adjusted earnings of 31 cents per share, down 13.9% year over year.
Kratos Defense & Security Solutions, Inc. Price, Consensus and EPS Surprise
Kratos Defense & Security Solutions, Inc. price-consensus-eps-surprise-chart | Kratos Defense & Security Solutions, Inc. Quote
Total Revenues
Total revenues were $249.3 million, which surpassed the Zacks Consensus Estimate of $248 million by 0.5%. Total revenues also increased 17.8% from $211.6 million in the year-ago quarter.
For full-year 2022, total revenues came in at $898.3 million compared with $811.5 million in 2021.
Operational Update
Kratos Defense’s SG&A expenses were up 8.8%, and research and development expenses surged 17.8% year over year. Depreciation expenses and expenses related to the amortization of intangible assets increased 23.1% and 10%, respectively.
KTOS reported fourth-quarter 2022 operating income of $4.1 million compared with $9.2 million in the year-ago quarter.
Kratos Defense’s consolidated book-to-bill ratio for the fourth quarter of 2022 was 1.2-1.0, with bookings of $999.1 million at the end of 2022.
Kratos Defense’s total backlog at the end of the fourth quarter of 2022 was $1.11 billion compared with $1.07 billion at the end of the third quarter of 2022.
Segmental Performance
Unmanned Systems: Net revenues in the fourth quarter improved 15.3% year over year to $62.7 million.
Government Solutions: Net revenues in the fourth quarter increased 18.7% year over year to $186.6 million, driven by contributions from the acquisitions of Cosmic AES, CTT and SRE. Organic revenue growth in the company’s Turbine Technologies and C5ISR businesses have also bolstered growth in this segment.
Financial Details
As of Dec 25, 2022, cash and cash equivalents were $81.3 million compared with $349.4 million as of Dec 26, 2021. Long-term debt totaled $250.2 million as of Dec 25, 2022, down from $296.7 million as of Dec 26, 2021.
During 2022, the cash outflow from operating activities was $25.6 million against a cash inflow of $35.3 million in the previous year.
Guidance
For the first quarter of 2023, KTOS expects to generate revenues in the $220-$230 million range. The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $220.7 million, near the lower end of the company’s projected range.
For 2023, the company currently expects revenues in the $980-1,000 million range. The Zacks Consensus Estimate for full-year revenues stands at $989.7 million, slightly below the midpoint of the company’s projected range.
Zacks Rank
Kratos Defense currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Spirit AeroSystems Holdings, Inc. SPR reported fourth-quarter 2022 adjusted loss of $1.46 per share, wider than the Zacks Consensus Estimate of a loss of 31 cents. The bottom line also widened significantly from the year-ago quarter’s loss of 84 cents per share.
Total revenues of $1,320 million lagged the Zacks Consensus Estimate of $1,378 million by 4.2%. However, the top line rose 23% on a year-over-year basis, driven by higher production deliveries of the Boeing 737 and increased Defense and Space revenues.
Leidos Holdings, Inc.’s LDOS fourth-quarter 2022 adjusted earnings of $1.83 per share beat the Zacks Consensus Estimate of $1.61 by 13.7%. The bottom line also improved 17% from the year-ago quarter’s $1.56.
Leidos Holdings generated total revenues of $3,697 million in the fourth quarter of 2022, exceeding the Zacks Consensus Estimate of $3,609 million by 2.4%. The top line also improved 5.9% year over year.
Huntington Ingalls Industries, Inc.’s HII fourth-quarter 2022 earnings of $3.07 per share increased 2.7% from the prior-year quarter’s $2.99. However, the bottom line missed the Zacks Consensus Estimate of $3.14 by 2.2%.
Total revenues came in at $2,812 million, beating the Zacks Consensus Estimate of $2,691.6 million by 4.5%. The top line also improved 5% from $2,677 million in the year-ago quarter.
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