Roger Krone, chairman and CEO of Leidos (NYSE: LDOS) and a 2020 Wash100 award winner, said during an interview on CNBC’s “Squawk Alley” program aired Tuesday that significant government contracts and acquisitions will support momentum for the Reston, Va.-based company this year. Shares in Leidos gained 10 percent in midday trade Tuesday.
In the interview, Krone talked about the reason behind the company’s $1.65B cash acquisition of Huntsville, Ala.-based technology services contractor Dynetics.
He said the acquisition made sense for Leidos because the technologies, such as hypersonics, space platforms and directed energy, that the company saw in Dynetics are completely aligned with the National Defense Strategy.
“I would also like to point out that Dynetics started as a services company and they still have a large service component,” Krone said. “We saw the move to Dynetics to add more product portfolio to Leidos overall. But we still want to have a strong mix of services and some products.”
Krone also shared his outlook on defense spending and talked about the opportunities to partner as more technology companies get into the government contracting space.
Leidos saw its fiscal year 2019 revenue increase by 8.8 percent to $11.09B and recorded $912M in FY 2019 operating income, up from $749M in the previous year. The company posted $14.5B in FY 2019 net bookings, reflecting a book-to-bill ratio of 1.3 for the year.
