UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549 - 0001
FORM 10-Q
(Mark
One)
ý Quarterly
Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of
1934
For The
Quarter Ended September 30, 2004
Or
o Transition Report Pursuant to Section 13 or 15(d) of The
Securities Exchange Act of 1934
Commission
File Number 000-30271
PEC SOLUTIONS, INC.
(Exact Name of Registrant
as Specified in its Charter)
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DELAWARE
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54-1339972
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(State or other
jurisdiction of incorporation or organization)
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(I.R.S. Employer
Identification No.)
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12730
FAIR LAKES CIRCLE, FAIRFAX, VA
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22033
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(Address of principal
executive offices)
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(Zip Code)
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Registrant’s telephone
number, including area code: (703) 679-4900
Indicate by check mark
whether the registrant (1) has filed all reports required to be filed by Section 13
or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to the filing requirements for the past 90
days. Yes ý No o
Indicate by check mark
whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the
Exchange Act). Yes ý No o
As of November 9,
2004, 27,524,036 shares of the registrant’s Common Stock, par value $.01 per
share, were outstanding.
PART I:
FINANCIAL INFORMATION
ITEM 1. Financial
Statements.
PEC
SOLUTIONS, INC.
CONSOLIDATED
BALANCE SHEETS
(Dollars
in thousands)
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As of
September 30,
2004
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As of
December 31,
2003
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(Unaudited)
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ASSETS
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Current
assets:
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Cash
and cash equivalents
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$
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14,152
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$
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33,401
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Short-term
investments
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4,880
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38,274
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Accounts
receivable, net
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63,875
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48,356
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Other
current assets
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15,720
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1,745
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Total
current assets
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98,627
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121,776
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Property
and equipment, net
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26,204
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26,674
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Investments
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24,600
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37,587
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Goodwill
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73,822
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16,932
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Intangibles,
net
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20,790
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2,849
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Other
assets
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4,638
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4,553
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Total
assets
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$
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248,681
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$
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210,371
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current
liabilities:
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Accounts
payable and accrued expenses
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$
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14,257
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$
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5,576
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Advance
payments on contracts
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1,095
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439
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Retirement
plan contribution payable
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1,306
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—
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Accrued
payroll
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5,030
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5,503
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Accrued
vacation
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4,451
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2,839
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Other
current liabilities
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13,999
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1,163
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Total
current liabilities
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40,138
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15,520
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Long-term
liabilities:
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Supplemental
retirement program liability
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1,560
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1,417
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Deferred
rent payable
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2,099
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1,790
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Long-term
lease obligation
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23,213
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23,062
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Total
long-term liabilities
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26,872
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26,269
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Total
liabilities
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67,010
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41,789
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Commitments
and contingencies
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Stockholders’
equity:
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Undesignated
capital stock, 10,000,000 shares authorized
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—
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—
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Common
stock, $0.01 par value, 75,000,000 shares authorized, xx and 27,303,041
shares issued and outstanding, respectively
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275
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273
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Additional
paid-in capital
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96,668
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95,219
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Retained
earnings
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84,787
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73,140
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Accumulated
other comprehensive loss
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(59
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)
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(50
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)
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Total
stockholders’ equity
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181,671
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168,582
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Total
liabilities and stockholders’ equity
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$
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248,681
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$
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210,371
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See notes to consolidated
financial statements.
4
PEC
SOLUTIONS, INC.
CONSOLIDATED
STATEMENTS OF INCOME
(Amounts
in thousands, except per share data)
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Three Months Ended
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Nine Months Ended
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September 30,
2004
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September 30,
2003
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September 30,
2004
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September 30,
2003
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(Unaudited)
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Revenues
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$
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55,216
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$
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43,295
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$
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140,089
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$
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131,025
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Operating
costs and expenses:
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Direct
costs
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34,500
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25,821
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86,236
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78,503
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General
and administrative expenses
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10,798
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8,758
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28,783
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26,992
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Sales
and marketing expenses
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1,876
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1,250
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4,400
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4,331
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Intangible
amortization
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644
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213
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1,160
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638
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Total
operating costs and expenses
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47,818
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36,042
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120,579
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110,464
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Operating
income
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7,398
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7,253
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19,510
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20,561
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Investment
and other income
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465
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604
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1,416
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1,781
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Interest
expense
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(670
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)
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(664
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)
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(2,006
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)
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(1,986
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)
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Income
before income taxes
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7,193
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7,193
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