Ross Wilkers


ManTech welcomes industry-wide returns of employees to work

Getting employees of government contractors back to a more regular work cadence amid the coronavirus pandemic has a mix of the employers pushing for it and waiting on customers to act on it.

Action by those agencies predominantly in the national security space has seen a large reduction in those contractor employees dependent on a key piece of legislation to cover certain paid leave costs, ManTech CEO Kevin Phillips told investors Thursday in an earnings call.

Section 3610 of the CARES Act economic stimulus signed in March lets contractors get reimbursement for keeping those employees at home in a “ready state” if they cannot access a government worksite due to social distancing directives that limit the numbers of people on site.

But in that call to discuss third quarter financial results, Phillips indicated agencies have further ramped up their efforts to get everyone in industry back into arrangements slightly closer to what they had pre-pandemic.

“There are more moves afoot to make sure people are working safely on site, where appropriate to have secured facilities at contractor facilities to help with expansion and mitigation, and where appropriate to have select work done in an unclassified environment,” Phillips told analysts. “Those things are all being considered, but in terms of how it plays out long term, we’ll have to wait and see.”

Even still, Phillips cautioned that Section 3610 coverage “remains critical to retaining some very important talent” across the industry and particularly for companies with heavy footprints in the intelligence community. That coverage is slated to expire Dec. 11, along with the current continuing resolution funding agencies at fiscal year 2020 levels.

Of less worry to ManTech (and at least some other companies) is whatever the presidential election’s outcome turns out to be. By the time one reads this, the White House's fate may be closer to a resolution but that was not the case when ManTech spoke to investors.

“We see the overall platforms for both administrations looking toward technology in advancing support of all national security activities and near peer threats as staying important,” Phillips said.

“We’ll wait and see how the composition of both the executive and legislative branches come out, but right now we think we’re in a strong position to support the priorities in our customer sets.”

Herndon, Virginia-based ManTech reported third quarter revenue of $636.2 million to show 10-percent growth over the prior year period. That translates into an increased sales outlook for this year at $2.49 billion-$2.51 billion.

ManTech was not ready to give a preview of next year yet, but also touted a record $9.8 billion backlog and a book-to-bill ratio of 1.4 times for the trailing 12 months to measure awards versus sales being booked.

Adjusted net income rose 6.3 percent year-over-year to $33.9 million, while ManTech lifted its expectation for that metric to $131.6 million-$133.2 million.

Regarding ManTech’s own technology priorities, Chief Operating Officer Matthew Tait broke those out into five areas -- cybersecurity, what he called “A-Cubed” (artificial intelligence, automation and analytics), intelligent systems engineering, mission and enterprise IT, and data at the tactical edge.

If and when ManTech makes its next acquisition, and the company reported its pipeline of candidates as active, going more in the direction of products like other government IT companies have does not sound likely.

“We’re still focused on solutions and services, we have good capabilities in supporting the government where appropriate in a more fixed-price and delivery basis,” Phillips said. “I don’t think we’re prepared to go into the hardware business right now, and not taking the best available that’s already in market by prioritizing our own specific assets and inventory.”

In fact, the company sees that approach as helping it to some extent amid the ongoing technology modernization thrust at many agencies.

“We’re seeing with our customers, the solution differentiation we bring is to be that honest broker without having any allegiances elsewhere has proven a great strength for us,” Phillips said.

About the Author

Ross Wilkers is a senior staff writer for Washington Technology. He can be reached at Follow him on Twitter: @rosswilkers. Also connect with him on LinkedIn.

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