Booz Allen Hamilton on January 31 announced preliminary results for its third quarter of fiscal 2014, which showed declines in both revenues and net income, which it attributed to problems in the government market. Revenue in the third quarter of fiscal 2014 was $1.27 billion, compared with $1.39 billion in the prior year period, a decrease of 8.6 percent.
In the third quarter of fiscal 2014, net income declined to $47.2 million from $56.2 million in the prior year period, and Adjusted Net Income decreased to $49.5 million from $59.7 million in the prior year period.
Third quarter revenue was impacted by the government shutdown between October 1, 2013, and October 16, 2013. However, in a news release, Booz Allen said it had anticipated continued uncertainty in the federal budgeting environment and effectively managed indirect costs during the first half of the fiscal year to ensure financial strength and flexibility during the second half of the fiscal year.
Within the third quarter, the company was able to maintain operations through the government shutdown without the need to furlough any impacted staff. Additionally, during the third quarter, the company was able to increase efforts that utilized indirect costs such as investments in growth areas and building additional staffing capacity in the defense market, and through continued investment in critical skill areas such as engineering, software/systems development, and analytics.
Ralph Shrader, Booz Allen’s chairman and CEO, said, “We manage our business on an annual basis, and our nine-month performance in this fiscal year reflects our ability to absorb impacts of events such as the October government shutdown. Our high productivity and strong management of cost during the first half of the year is enabling us to weather this business disruption and continue to deliver results to our clients and shareholders while investing in the future.
“Given the recent passage of the Consolidated Appropriations Act, we are cautiously optimistic for greater stability in our core government business as well, as we celebrate our 100th year in 2014.”