Parsons, a technology-focused firm and federal government contractor, reported record revenues, earnings and other milestones in the third quarter of 2024.
In a statement released Wednesday, Carey Smith, chair, president and CEO of Parsons, said, “We delivered record third-quarter results for total revenue, organic revenue growth, net income, adjusted EBITDA, operating cash flow, and contract awards.”
According to Smith, a Wash100 awardee, it was also the sixth consecutive quarter that Parsons achieved over 20 percent organic growth. He also notes that the top-line growth continues to outpace bottom-line growth.
Financial highlights
In the three months ending Sept. 30, total revenue and net income climbed 28 percent and 52 percent to $1.8 billion and $72 million compared to Q3 2023. Adjusted EBITDA and cash flow from operations rose 31 percent and 46.6 percent year-over-year to $167 million and $299 million. The contract awards, a third-quarter record, increased 24 percent to $1.8 billion.
Parsons continues to win new business in its core business segments: Federal Solutions and Critical Infrastructure. During the same quarter, the company won four single-award contracts worth more than $100 million each.
Strategic acquisition
During the earnings call, Parsons Chief Financial Officer Matt Ofilos, said, “Our strong cash flow is enabling us to continue to make strategic internal investments and accretive acquisitions to support our long-term growth objectives.”
On Aug. 16, Parsons completed the $200 million acquisition of BlackSignal Technologies. The Razor’s Edge portfolio company expands its customer base across the Department of Defense and Intelligence Community. Besides strengthening Parsons’ positioning with full-spectrum cyber and electronic warfare, it adds new capabilities in the counter-space radio frequency domain markets.
“As a result of our strong operating performance and our BlackSignal acquisition, we are raising our full-year revenue, adjusted EBITDA, and cash flow guidance ranges,” Smith added.
Revised full-year guidance
Parsons revised its fiscal year 2024 guidance upwards following the solid quarterly results and positive outlook for the rest of the year. The new revenue guidance is between $6.6 billion and $6.8 billion, with an Adjusted EBITDA of $590 million to $620 million. Parsons forecasts cash flow from operating activities to be between $425 million and $465 million.
New all-time high
Parsons closed its initial public offering on May 8, 2019, and started trading on the NYSE. On Oct. 30, 2024, the stock hit an all-time high of $112.19 before settling at $110. At its current share price, the overall return in 5.47 years is 265.81 percent, representing a compound annual growth rate or CAGR of 26.68 percent.
