PAE has announced third quarter 2020 financial and operating results, reporting revenues of $666.2 million, decreased $31.5 million. The decrease was attributable to a $53.3 million impact from COVID-19, the company said on Thursday.
“Revenue was in-line with expectations and profitability and cash flow exceeded our objectives for the quarter. In summary, we are delivering strong financial results and achieving our growth, profitability and capital structure initiatives in accordance with our strategy,” said John Heller, president and CEO of PAE, and 2020 Wash100 Award recipient.
PAE reported that COVID-19 impacted approximately $42.8 million in non-labor and $10.5 million in labor, which decrease was partially offset by a $21.9 million net increase in contract volume and new business programs.
The Global Mission Services (GMS) and National Security Solutions (NSS) segments revenue decreased by approximately $14.3 million and $17.2 million, respectively.
Operating income for the quarter was $28.5 million, compared with an operating loss of $10.5 million in the prior year period. The increase is due from the write down of PAE ISR assets held for sale in the prior year period.
PAE reported lower Selling, General and Administrative expenses, and increased volume on higher margin programs in the current period, which increase was partially offset by lower revenue volume in the current period.
The net income attributed to PAE for the quarter was $10.3 million, compared with a net loss of approximately $32.2 million in the prior year period. The improvement in net income for the third quarter of 2020, was primarily driven by the increase in operating income and lower interest expense, which was driven by a reduction in debt year over year.
Adjusted EBITDA for the quarter was $46.2 million, compared to $50.0 million in the prior year period. Adjusted EBITDA and margins declined due to lower revenue volume and timing of net profit adjustments in the prior year period, which decrease was partially offset by increased volume on higher margin programs.
“PAE continued to execute our plan, delivering strong revenue, profitability, cash flow and bookings. Of additional and positive note after quarter-close we completed our successful debt refinancing and announced the signed purchase agreement with CENTRA Technology, Inc,” Heller added.
For 65 years, PAE has tackled the world’s toughest challenges to deliver agile and steadfast solutions to the U.S. government and its allies.
With a global workforce of approximately 20,000 on all seven continents and in approximately 60 countries, PAE delivers a broad range of operational support services to meet the critical needs of our clients. Our headquarters is in Falls Church, Virginia.