Businessweek

Dynamics Research Corporation reported that the Department of Veterans Affairs, through the General Services Administration, has exercised the third option year of the Veterans Relationship Management Portfolio Monitoring and Coordination contract extending the period of performance through May 10, 2014. The contract, which was awarded to DRC's wholly owned subsidiary, High Performance Technologies Inc., in May 2010, has a 5-year period of performance through May 2015, and a total contract value of $125.5 million. Veterans Relationship Management is a multi-year initiative restarting previously troubled programs with the goal of delivering fast, accurate, and easily accessible healthcare information and benefits to Veterans, Service members and eligible beneficiaries. DRC provides the full range of program and portfolio management services across 30+ projects delivering the next generation of Veteran-centric IT solutions. These solutions including identity management, advanced voice-recognition tools, enhanced web self-services tools, and integrated desktop interfaces. DRC provides program architecture, program planning and management, requirements analysis, IV&V, and life cycle engineering to create an IT system that allows Veteran's to access the VA through multiple methods, find information about VA's benefits and services through a uniform interface, and complete multiple business processes within VA without having to re-enter identifying information.

Effective April 26, 2013, Dynamics Research Corporation amended its Senior Subordinated Loan Agreement entered into with Ares Mezzanine Partners, L.P. and its Credit Agreement entered into with Bank of America, N.A., as Administrative Agent. The amendments adjusted the calculation of Consolidated Fixed Charge Coverage ratio to exclude from the calculation of Consolidated Fixed Charges the impact of any make-whole or call payments related to any such payment of the subordinated debt.

Dynamics Research Corporation reported unaudited consolidated earnings results for the first quarter ended March 31, 2013. For the quarter, the company reported net income of $1.2 million, or $0.12 per basic and diluted share, as compared with $1.8 million, or $0.17 per basic and diluted share, for the first quarter of 2012. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $6.1 million, or 8.3% of revenue, as compared with $7.9 million, or 9.2% of revenue, for the same period a year ago. Revenue was $73.6 million compared with $85.9 million for the same period in 2012. During the first quarter, the company used $6.8 million of cash from operations as compared to a use of $1.6 million in the same period a year ago. Operating income was $4.21 million compared to $5.67 million last year. Capital expenditures were $0.28 million compared to $0.09 million last year. Income before provision for income taxes was $2.10 million compared to $3.03 million last year. For the second quarter of 2013, the company anticipates revenue in the range of $71 to $74 million and earnings of $0.10 to $0.12 per diluted share. Depreciation and amortization at $1.9 million, cash generation from operating activities in the range of $8.0 million to $8.5 million, capital expenditures in the range of $800,000 to $1 million as the company completed the renovation of its new Reston, Virginia, office and a tax rate of 41%. While the company had a seasonal net use of cash in the quarter, as is typical, the company expects much stronger cash generation during the balance of 2013. Considering current uncertainties regarding federal government expenditure decisions, the company continues to refrain from providing financial guidance for the balance of the calendar year 2013. Depreciation expense expects in the range of $3.5 million to $3.7 million, amortization expense expects at $3.7 million, capital expenditures expects in the range of $1.3 million and $1.7 million for the year. A tax rate of 41% and cash tax estimate which is a refund of $600,000 for the year.

Dynamics Research Corporation announced that they will report Q1, 2013 results at 5:00 PM, Eastern Standard Time on May 01, 2013

Dynamics Research Corporation, Q1 2013 Earnings Call, May 02, 2013