UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 14, 2009
SAIC, Inc.
(Exact Name of Registrant as Specified in its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
| 001-33072 | 20-3562868 | |||
| (Commission File Number) | (I.R.S. Employer Identification No.) |
1710 SAIC Drive, McLean, Virginia 22102
(Address of Principal Executive Offices) (Zip Code)
(703) 676-4300
(Registrant’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
FORM 8-K
Item 7.01 Regulation FD Disclosure.
SAIC Institutional Investor Conference
SAIC, Inc. (Company) will hold its third annual Institutional Investor Conference (Conference) in McLean, Virginia today, October 14, 2009. At the Conference, several senior executives of the Company will make presentations and discuss the Company’s current performance and strategies for the future. Interested parties can listen to the presentations through a live audio webcast on the Company’s website, www.saic.com, beginning at 8:00 a.m. Eastern time today, October 14, 2009.
Charts to be used in the presentations made by the Company’s senior executives at the Conference are attached to this report as Exhibit 99.1.
Certain statements made in the charts attached to this report as Exhibit 99.1 or by executives at the Conference contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act). Forward-looking statements involve a number of risks and uncertainties. A number of factors could cause the Company’s actual results, performance, achievements, or industry results to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. Some of these factors include, but are not limited to, the risk factors set forth in the Company’s Annual Report on Form 10-K for the year ended January 31, 2009, the Company’s Quarterly Reports on Form 10-Q and other filings that the Company makes with the SEC from time to time. Due to these uncertainties and risks, readers of this report and persons who view these presentations are cautioned not to place undue reliance on such forward-looking statements, which speak only as of October 14, 2009. The Company disclaims any duty to update guidance or any other forward-looking statement provided in the Exhibit to this report or in the presentations made by Company executives at the Conference to reflect subsequent events, actual results or changes in the Company’s expectations.
The information contained in this report, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liabilities of that section of the Exchange Act. Furthermore, the information contained in this report, including the Exhibit attached hereto, shall not be deemed to be incorporated by reference into any registration statement of the Company or other document filed by the Company pursuant to the Securities Act or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
| (d) | Exhibits |
| Exhibit 99.1* | Charts used in senior executive presentations made on October 14, 2009 at the SAIC Institutional Investor Conference. |
| * | This Exhibit shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section of the Exchange Act, nor shall it be incorporated by reference into any filing under the Securities Act or the Exchange Act. |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| (Registrant) | SAIC, INC. | |||
| Date: October 14, 2009 | By: | /s/ DOUGLAS E. SCOTT | ||
| Douglas E. Scott | ||||
| Its: | Executive Vice President | |||
| General Counsel and Secretary | ||||
3
 Management Presentations Exhibit 99.1 |
 Welcome and Introduction Stuart Davis SVP, Investor Relations |
 3 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Conference Materials • Day 1 Book • Day 2 Book – Management Presentations – Presenter Biographies – Acronym Glossary • Both books and the replay of today’s event are available on SAIC’s Investor Relations website |
 4 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Agenda LUNCH 12:00 PM Panel Energy Campaign 11:35 AM Joe Craver Infrastructure, Logistics and Product Solutions Group 11:15 AM Charles Koontz IT and Network Solutions Group 10:50 AM Stu Shea Intelligence, Security and Technology Group 10:25 AM Deb Alderson Defense Solutions Group 10:00 AM BREAK 9:45 AM Corporate Q&A 9:15 AM Amy Alving Technology Programs and Discriminators 9:00 AM Mark Sopp Financial Overview 8:40 AM Walt Havenstein Enterprise Outlook 8:20 AM Ken Dahlberg Enterprise Update 8:05 AM Stuart Davis Welcome and Introduction 8:00 AM |
 5 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Certain statements in these presentations contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended. The
forward-looking statements involve a number of risks and uncertainties. A number of factors could cause our actual results, performance, achievements, or industry results to be materially
different from any future results, performance, or achievements expressed or
implied by these forward-looking statements. Some of these factors
include, but are not limited to, the risk factors set forth in SAIC’s Annual Report on Form 10-K for the year ended January 31, 2009, and other filings that SAIC makes with the SEC from time to time. Due to these
uncertainties and risks, persons who view these presentations are cautioned
not to place undue reliance on such forward-looking statements, which
speak only as of October 14, 2009. SAIC disclaims any duty to update
guidance or any other forward-looking statement provided in these
presentations to reflect subsequent events, actual results or changes in expectations. Forward Looking Statements These presentations describe financial results through 7/31/09 (FY2010 Q2)
|
 Ken
Dahlberg Chairman of the Board Enterprise Update |
 7 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Company’s Ethos • Demonstrated ability to execute – Delivered on growth promises – Built credibility through transparent shareholder communications • Positioning, agility, and ability to compete to ensure growth – Little exposure to platforms that could come under pressure – Significant exposure to higher growth markets – Winning larger programs – Excellent IDIQ portfolio, aggressive task order marketing, and high win rates
• Key discriminators in a tough market – Scale to generate significant discretion and management efficiencies – Technical talent to create innovative, fast response solutions • To understand us, you need to understand our major themes: – From Science to Solutions – Smart People Solving Hard Problems Our Growth Prospects Remain Solid |
 8 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. From Science to Solutions Energy and the Environment: Smart Grid Solutions • Combining engineering, IT, and scientific solutions to next-generation grid
• R.W. Beck acquisition/BPLG alliance create real presence in emerging market • Cyber security, weather analytics, s/w solutions create differentiators 09-1844-ID-01 National Security: MRAP C3 and Logistics Integration • Rapidly engineered and deployed 15K+ vehicles to meet Army’s #1 threat • Collaborated to propose and deliver integrated in-theater logistics solution
• Leverage to M-ATVs (engineering) and USMC counter-IED (logistics) Critical Infrastructure: Products for Border and Port Security • Suite of inspection and detection products to protect the nation • VACIS ® combines accuracy with speed and low footprint to facilitate commerce • Robust military and civil markets with breakout opportunity (SFI, Mexico) Health: Military Health Records Management • Invested IR&D to create SOA-based solution to share data across DoD/VA
• Operating prototype at shared DoD/VA facility (Great Lakes) • Serves as foundation for Obama’s Virtual Lifetime Electronic Record
initiative |
 9 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Smart People Solving Hard Problems Energy and Environment: Michael Mondshine (Climate Change) • Climate change policy expert; developed greenhouse gas reporting standards • Named to UN Framework Convention on Climate Change roster of experts • Recognized by Intergovernmental Panel on Climate Change (IPCC) for contributions leading to their 2007 Nobel Peace Prize National Security: Chris McClone (Geospatial Modeling) • Fusing LiDAR-based 3-D urban models and remote sensing imagery • Internationally recognized authority on remote sensing and published author of
the authoritative manual on photogrammetry Critical Infrastructure: William Salazar (Cyber Security) • Prepares network defenders for actual attacks by simulating adversaries • Directs incident response team to respond to successful cyber attacks • Built best-of-breed D2R (Detect, Diagnose and Respond) system Health: Laura Peitersen (Biosurveillance) • Coordinated public-private field avian influenza virus surveillance network
• Couples behavioral monitoring of wildlife with the use of
state-of-the-art, real-time
pathogen detection and rapid analysis technologies |
 10 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. SAIC Organization CEO Walt Havenstein Chairman Ken Dahlberg Mark Sopp CFO Defense Solutions Deb Alderson Information Technology and Network Solutions Charles Koontz Infrastructure, Logistics and Product Solutions Joe Craver Intelligence, Security and Technology Stu Shea Gov’t Affairs, Communication and Support Ops Arnold Punaro Legal and Audit Doug Scott Human Resources Brian Keenan Strategic Initiatives and Investments Joe Walkush Business Development Jim Cuff Technology Amy Alving |
 11 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Major Accomplishments • Corporate Governance – Hired ideal CEO replacement to extend the business momentum – Received shareholder approval to eliminate dual-class share structure • Financial Performance – TTM internal revenue growth of 9%, 40 bps margin expansion, 17% EPS growth – Excellent program performance with virtually no program write-downs • Business Growth – Positioned for future growth with aggressive submittals and competitive win rates
– Increased traction in all major campaigns, especially cyber, energy, and
logistics – Acquired significant new capability in energy, live training, and translation and
analysis • Employee Engagement – Significantly improved voluntary attrition—9.2% FY10 YTD; 11.9% FY09; 13.9% in
FY08 – Successfully implemented several engagement initiatives; validated by survey
results • Management Efficiency – On track for successful transition to Costpoint Deltek for gov’t business by year-end – Continued transition to shared services model throughout the organization
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 12 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Business Development Successes • Protracted procurement cycle has led to H1 book-to-bill of 0.9 – Pace has picked up since Q2 and on track for record year in IDIQ vehicle awards – High YTD win rates on recompetes (90%+) and new business (60%+) • Large awards tracking higher – 24 $100M+ wins YTD (11 in Q3) vs. 27 in FY09 and 17 in FY08 – 42 more $100M+ decisions expected this year, including 32 pending awards • Pending proposals and fully qualified pipeline at all-time highs – $9.3 billion pending standard contract/task order proposals ($8.5 billion at Q2)
– $16.6 billion pending including IDIQs ($13.0 billion at Q2) – $91 billion qualified pipeline ($83 billion at Q2, $70 billion a year ago) – Another $90B of potential opportunities in “track” status • Expect significant stimulus awards by year-end (>$100M) – Many smart grid opportunities with utilities awaiting decision at DOE – Also pursuing opportunities in energy efficiency, infrastructure, homeland security, IT
solutions, health, and environmental • Major improvements to business development infrastructure – New leadership emphasizing collaboration (BD Council, Account Mgmt)
|
 13 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Major FY10 Wins • Securing Base Business – ARMY AMCOM SED ($848M Single-Award IDIQ): Software engineering support – ARMY STOC II ($17.5B Multiple-Award IDIQ): Simulation and training support to
warfighter – MRAP JLI II ($357M Single-Award IDIQ/$357M TO): Joint Logistics Integrator for
MRAP – MHS Support ($159M): Onsite support for Military Health System clinical IT
systems – Classified ($158M Multiple-Award IDIQ): Information assurance services for
Intelligence Agency • Expanding Current Work – DGS ($1.2B Single-Award IDIQ Extension/$113M TO): Lifecycle mgmt of DISA
Network – MRAP JLI ($142M Single-Award IDIQ Extension/$106M TO): Expansion of MRAP JLI
– Classified ($117M): Integrate and deploy solutions in support of NSA missions • Building New Business – SPAWAR Tactical C2 ($197M Multiple-Award IDIQ): Command and control integration
support – EPA IT ($955M Multiple-Award IDIQ): IT Services for the EPA Office of Environmental
Information – ARMY ASC DMC ($128M): Logistics support for Reset/Army Force Generation cycle – FEMA ITD ($500M Multiple-Award IDIQ): O&M support to FEMA CIO and IT
Division – ARMY TARDEC OMNIBUS ($500M Multiple-Award IDIQ): RD&E services – USMC CREW ($120M Single-Award IDIQ): Logistics lifecycle support – AIR FORCE FPS2 ($495M Multiple-Award IDIQ): Force protection security services
Note: Q3 Awards listed in bold |
 14 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Building Credibility • Targeting 15% Long-Term EPS Growth • Execute corporate campaigns around energy, health, cyber security, and space superiority • Addressable market growth will flatten, but market remains large • Industry must navigate increasingly hostile environment – Wartime Commission – Congressional hearings – Organizational Conflicts of Interest • Manpower entitlements limit funds available for contractors; major platforms, including FCS, come under pressure – Desire to “in-source” – Populist rhetoric – Anti-contractor bias IPO 2007 Conference 2008 Conference |
 15 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Enterprise Summary • Well-established rhythm as a public company – 3 years since IPO – Hallmark of steady, solid performance – Transparency and thought leadership • Significant businesses in known growth markets – Campaign investments paying off – Early identification and pursuit has been critical • Our technology discriminators will become even more important – 75% solutions demand quick response versus long production cycles – Increased IR&D investments by 38% since going public • When markets are tough, SAIC can thrive and grow – We compete well—we have high win rates and an excellent IDIQ portfolio – We have the scale to invest and are leveraging fixed infrastructure costs – Our heritage of entrepreneurial spirit provides market agility – Our innovative people create business differentiators |
 Walt Havenstein Chief Executive Officer Enterprise Outlook |
 17 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. My Background • BAE Systems – COO/board member of $34B global aerospace and defense company – President and CEO of $20B wholly-owned U.S. subsidiary – President of Electronics & Integrated Solutions Operating Group – President of Information and Electronic Warfare Systems business unit – Deployed $10B on 20 acquisitions in 8 years; grew subsidiary from $2B to $20B in 5
years • Prior Industry Experience – President of the Sanders defense electronics business – Vice president and general manager of the Strategic Systems Division for Raytheon
– Various business development/program management roles at ITT • Military Background – Active duty in U.S. Marine Corps, specializing in tactical communications and systems
acquisition mgmt – Retired from Marine Corps Reserve as a colonel – Bachelor's degree in aerospace engineering from the U.S. Naval Academy – Master's degree in electrical engineering from the Naval Postgraduate School • Other Leadership Positions – Member of Executive Committee, Council on Competitiveness – Board of directors for FIRST (For Inspiration and Recognition of Science and Technology) – Board of advisors for the University of New Hampshire, Whittemore School of Business |
 18 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. My Impressions of SAIC • 45K people doing great work on our nation’s toughest problems • Entrepreneurial spirit runs deeps within employees • Strong science and technology capability • But, not yet maximizing our potential – Not punching our weight – Not leveraging the strength of our people – Not perceived as big as we are (e.g., 4 th largest employer in the NCR) – Not thinking big enough • Tremendous balance sheet offers great flexibility – Limited capital requirements or pension exposure |
 19 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Evolving Market Focus C4ISR Intelligence CBRNE / Homeland Security Logistics Space Superiority Cyber Energy Health C4 ISR Telcordia AMSEC ProcureNet Geo-Centers Benham Atlan BD Systems Beck DR Beck Consulting $1.7B Varec BPLG Global Information Grid NATO C2 CENTCOM IT Tires POL-Chem MRAP JLI Contract Win Acquisition IR&D Investment $1.2B $600M $700M $800M $850M $400M VA/DoD Sharing MHS Wins DOE ESPC Security Product Enhancements GPS SE&I Guardian SBOC Cyber Tools $250M $450M $170M $160M |
 20 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Enterprise Market Segments 15% of revenue in C4 • Moderate investments • Large addressable market • Large opportunities • Demonstrated ability to compete 43% of revenue in major growth campaigns • Focus of investments • End-market growth generally >10% • Differentiated offerings • Support margin expansion goals 10-1230-IC-10 42% of revenue in core business • Limited investments • Create discretion to fund campaigns • Significant overhead absorption • SAIC legacy • Includes some group-level focus areas C4 ISR Cyber CBRNE/HLS Energy Logistics Health Core |
 21 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. 120-Day Plan • Deliver on fiscal year 2010 financial commitments • Set fiscal year 2011 operational plan • Accelerate cost reductions to create strategic runway – Invest more in technology, people, and capability and less in oversight • Establish corporate cadence • Set strategic direction – Go live by Q1 of FY11 • Crystallize roles and responsibilities – Assess organization based on strategy – Assess people based on organization • Connect with major stakeholders |
 22 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Strategic Summary • I will be focused on growth • I expect to leverage our balance sheet and be more aggressive in M&A – Reliability and predictability in core business allows us to take on more risk
– Once we articulate our strategy, we will be disciplined enough to adhere to it
• I believe science and technology dominates regardless of market conditions • I am excited by the challenge to maximize the performance of a company unique in the government services market – Driven by science and technology – Motivated by an entrepreneurial spirit – Of sufficient scale to compete for the most demanding contracts – Capitalizing on the strategic flexibility from public and employee ownership
|
 Financial Overview Mark Sopp Chief Financial Officer |
 24 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Guidance • Executing long-term earnings model in place since the IPO – 6%-9% internal revenue growth – 20-30 bps operating margin improvement – 11%-18% EPS growth with target of 15% • On 9/2 earnings call, we reaffirmed that we expect to meet these long-term goals for FY10 • Today we reaffirm this guidance for FY10 – We expect to provide FY11 guidance on our Q3 earnings call
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 25 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Revenue Growth Trend Key Growth Drivers • Increasing B&P and IR&D by 45% since FY07 (19% in FY10) • Investing in high growth areas and discriminating technologies • Enhancing collaboration and focus on larger programs ($100M+) – FY10 YTD: 24 >$100M wins – FY10 remainder: 42 >$100M decisions expected (32 pending) 10-1230-IC-03 – FY08: 17 >$100M wins – FY09: 27 >$100M wins |
 26 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Revenue Breakout • Higher growth in larger systems integration and logistics: – Higher non-SAIC labor content – Greater fixed price mix • Continued migration towards IDIQs 32% 33% 36% Standard Contract 67% 15% 27% 25% 19% 33% 48% 41% 59% 14% 23% 31% 32% FY09 Revenue 64% 14% 26% 24% 18% 35% 47% 39% 61% 17% 22% 29% 32% FY08 Revenue 68% Subtotal Master and Schedule Agreements 14% GSA Schedule 27% Multiple-Award IDIQ TO 27% Single-Award IDIQ TO Contract Source 21% 31% Time and Materials 48% Cost-Reimbursement Contract Type 42% 58% Labor-Related Revenue Type 14% IT & Network Solutions 22% Infrastructure, Logistics and Product Solutions 33% 31% Intelligence, Security and Technology Organization FY10 H1 Revenue Attribute Defense Solutions Material and Subcontract Fixed Price |
 27 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Operating Margin Improvement 0 40 60 80 100 120 140 160 Option Reductions Higher Contract Fees/Shift to Fixed Price Improved Indirect Rate Management Business Process Improvement IT Modernization Spend Reductions Facilities Consolidation Higher Margin Markets 7.7% 7.9%- 8.0% 8.2% 8.4% 8.6% 20 FY08 FY09 FY10 FY11 FY12 FY13 7.5% Containment of Unallowable Costs Project Alignment Activities Consistent and steady margin improvement to FY13 and beyond
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 28 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Potential Non-Recurring Income Events • Upside: – FCS Fee Recognition (if contract modification = material change in terms) – Greek Olympics Contract—filed for arbitration in June 2009 – Real Estate Monetization—significant value in McLean and San Diego – Telkom South Africa Settlement—currently in arbitration; discontinued
operations • Downside: – FCS Fee Recognition (if contract modification material change in terms) – NCCIPS—in early phase of DoJ False Claims Act case – Scottish Power—pension charges with contract termination/renewal (March
2010) – DCAA—cost accounting structure, incurred cost claims, systems audits
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 29 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Capital Deployment and Liquidity • Business model funds growth and generates significant operating cash flow – Operating Cash Flow = Net Income + D&A + Special Items – Capital expenditures less than 1% of revenues • Deploy capital on a rational, disciplined basis to build long-term value for our stockholders – Internal growth initiatives – Strategic acquisitions – Share repurchases • Conservative liquidity posture – Invested primarily in Treasury and Government money market funds • Currently “A-”;
maintain
investment grade credit rating in this market – Estimated funds available for M&A — $1.1B at A-, $1.9B at BBB+, $2.9B at BBB 244 524 285 Free Cash Flow 1,096 (14) 71 (10) (215) (145) (61) 346 FY08 936 (93) 82 (113) (382) (204) (59) 583 FY09 951 9 32 (16) (250) (1) (28) 272 FY10 H1 Ending Cash Position Cash From Continuing Ops Other Payment of Debt Public Stock Repurchases Acquisitions Capital Expenditures Operating Cash Flow Capital Deployment ($M) |
 30 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Deltek Costpoint Implementation Benefits achieved or anticipated • Burn off of $30M annual implementation cost • More automated A/R, job cost, indirect rate management – Lower cost, greater speed • More efficient O&M support function • Supports various business structures 10-1230-IC-04 Commercial & Subs 11% Waves 1-2 (Completed) 55% Wave 3 (End FY10) 34% |
 31 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Project Alignment Update Comprehensive, multi-year program to: • Streamline and standardize processes • Establish Shared Service Center • Consolidate support functions • Leverage scale for buying power Overall Benefits: • Allows line management to focus on running and growing business • Provides additional funds for reallocation and/or profit $100M+ Expected Annual Savings: • Lower wrap rates to increase competitiveness • Increase investment to drive growth and profitability – B&P to increase volume and win probability – IR&D to build discriminators • Improve op margin – Higher fees on fixed price and T&M |
 32 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Financial Summary • Sustainable shareholder value creation – Maintain steady internal revenue growth – Continue to improve operating margins – Low asset intensity – Predictable and growing free cash flow – More aggressive deployment of capital with significant capacity • Consistent, demonstrated progress on all financial fronts • Realistic and achievable path – Culture of discipline and collaboration – Building pipeline of large opportunities – Investing in infrastructure and people to support sustainable growth
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 Amy
Alving Chief Technology Officer Technology Programs and Discriminators |
 34 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Commitment to Technology • From Science to Solutions ® – Technological innovation is our heritage… and our future. • Smart People Solving Hard Problems – Our people are our strongest asset • We will leverage our existing expertise to new customers and markets – The depth and breadth of our technical expertise, deep customer understanding,
and operational experience provide the foundation for our future growth Be the leading systems, solutions, and technical services company, solving our customers’ most important business and mission-critical problems through innovative applications of technology and domain knowledge
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 35 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Investing to Leverage “One SAIC” Disease Surveillance, Epidemiology Specialized Medical Knowledge Neuroscience Advanced Bio and Chem Sensors Medical Research Macro Financial Energy Models Energy Transmission and Distribution Fuel and Energy Sources Neutron and Gamma Physics Cryptology and Cyber RF and Optical Physics Command and Control Modeling, Simulation and Training Biometrics ISR Enablers Defense Solutions Deb Alderson Intelligence, Security and Technology Stu Shea Information Technology and Network Solutions Charles Koontz Infrastructure, Logistics and Product Solutions Joe Craver |
 36 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Sensors and Analysis; Modeling and Simulation • ISR Enablers – Advanced detectors and sensors – Advanced signal and image processing – Advanced analytics – Scalable comms and ISR architectures • Biometrics – Sensor integration, DB management – Identity resolution, link analysis – Language services, sound/speaker ID • Modeling, Simulation and Training – Physics-based models – Full-spectrum simulation – Composable systems • Command and Control – Automated course-of-action tools – Service-oriented architectures The elimination a mortal blow to radical Zionism and provided a fitting revenge for the assassination of the martyr Abu Ali Mustafa. of Zeevy dealt |
 37 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. • RF and Optical Physics – Directed-energy technologies (RF, lasers) – High-energy power conditioning – Advanced optics (non-linear optics, adaptive optics, optical communications) • Cryptology and Cyber – Efficient and low-power encryption solutions – Cyber vulnerability and exploitation (research, modeling and simulation) – Information assurance testing and certification (Common Criteria Test Lab) – Detection/diagnosis/remediation tools – Real-time, quantitative cyber training environment Electromagnetics; Next-Gen Information Technology |
 38 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Particle Physics; Fuel and Energy • Neutron and Gamma Physics – Patented photon-counting technologies – High-energy imaging – Spectroscopic analysis • Fuel and Energy Sources – Geophysics of oilfields – Carbon capture and sequestration – Algae biofuels • Energy Transmission and Distribution – Demand/response analytics, fault prediction – Renewables integration, microgrids – Cyber security for SCADA systems • Macro Financial Energy Models BPL Global Power SG ® Am-241 Cs-137 Ra-226 Energy (keV) |
 39 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Medicine, Biology and Chemistry • Medical Research – Cancer and AIDS research – Translational medicine – Bioinformatics, genomic analysis • Advanced Bio and Chem Sensors – Exploiting genomic insight; biomimicry • Neuroscience – Augmented cognition; brain-computer interface – Psychological health, warfighter trauma • Disease Surveillance, Epidemiology • Specialized Medical Knowledge |
 40 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Enabling our Technology Strategy 10-1230-IC11 Career Path Technical Fellows Interns IR&D University Alliances System Engineering Program Management Contract Performance Passion for Mission Customer Understanding Collaboration People Science and Technology Core Flawless Execution Innovation Aggressive, Agile, Adaptive Small Business Partners |
 Defense Solutions Group Deb Alderson Group President |
 42 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Focused on the Mission Begins and Ends with the Partnership |
 43 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Tom Baybrook $700M John Gully $700M Peter Dube $650M Bev Seay $550M Debbie James $450M Ground Forces Integration & Thru Life Support Army C3 (SE&I, S/W, SOA) High-end Engineering Services to Solutions C2 & C3/4 Systems Net-centric Communications IT Services & Enterprise Solutions Modeling, Simulation & Training (Products) C2 SE&I (Systems & Infrastructure) Global Challenges & Threat Reduction (Services) Aviation C4ISR Platform Integration; Tactical Vehicle Integration Enterprise Arch. & IT C4IT Integrated Security & Surveillance Naval and Joint Ops • Army • Air Force • NATO • Navy • Marines • Coast Guard • DISA • National Guard • City of New York • Navy • Marines • State & Local • Army • Missile Defense Agency • Navy DSG Structure and Customers Systems and Technology Solutions Enterprise and Mission Solutions Analysis, Simulations, Systems Engineering and Training C4IT Defense and Maritime Solutions $3,050M Defense Solutions Group Deb Alderson Group President Note: All figures represent FY09 revenue |
 44 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. DSG Accomplishments • People First – Aggressive expansion of professional qualifications & certifications – Voluntary terminations below 10% – Leadership development • Strong Financial Performance – Internal revenue growth rate of 19% in FY09 and 16% in FY10H1 • Excellent Program Execution – Integrated and delivered 15K MRAPs ahead of schedule; M-ATV ramp-up now completed – Successful execution of large FY09 awards (e.g., AITS, CENTCOM IT, Army HRIT)
– Expanded SE&I into DARPA with Algae-Biofuel work – Continued to execute on legacy programs (e.g., FCS, DGS, OneSAF) – Serving the needs of warfighter at AMCOM and SPAWAR • Growing the Business – Won 97% of all recompetes – Pipeline at 10x revenue – Excellent task order marketing with ITES, SeaPort-e, AMCOM EXPRESS – Significantly expanded COCOM and National Guard business – International Command and Control – Electronic Warfare at NSWC Crane |
 45 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Market Imperatives SAIC Approach Customer Change • Irregular Warfare • QDR SE&I Agent Buying it Differently • 75% Solutions The Network as the Platform for Innovation Building it Differently • Integrated Solutions DSG Driving Force: Taking Services to Solutions Product Independence Flagship Programs Customer Knowledge Enablers • Irregular Warfare • QDR Using it Differently Enabling innovation in Doctrine & Organization |
 46 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Opportunities • SE&I Agent Approach/Network as Platform for Innovation • Hardware-independent – no proprietary lock-in…differentiated from the Primes • Applying Modeling and Simulation expertise to C4 • $20B Pipeline • Higher end fixed price solution opportunities with margins approaching 10% • Market stable; growing with inflation • Systems Engineering and Integration; high end technical and engineering services NATO AIR C2IS AOC WSI GSM Recompete SNEP SAIC Differentiators C4 Campaign • C4 • SE&I • Network Integration • SOA Expertise • Network Modeling and Simulation and Training • Information Assurance • Port Security Solutions SAIC Capabilities COCOMS Army Navy DISA AF Customers |
 47 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. • Systems Engineering/Integration • MRAP/Joint Logistics Integration expertise • Integrated hybrid power train expertise • Advanced Armor taking science to solutions • Tactical Vehicle Modeling and Simulation • Mission Knowledge • MRAP/JLI • Product independent • Life-cycle capability management across different customer bases – Army, Navy, AF • Key Strategic Partnerships – Gov’t and private sector • $13B Pipeline • Integrated solutions offer 10% market growth; 8% profit before tax • Reset and sustainment across the entire life cycle…services to solutions • International Ground Forces Integration Future Vehicle Integration ABCTM JBC-P BETSS-C Phase 2 SAIC Capabilities Opportunities SAIC Differentiators Other Allied Militaries Army USMC UK/ French MoDs National Guard Customers |
 48 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. • 40 Years of MS&T experience • Live: MILES and range instrumentation • Virtual: Common Driver Trainer, All Terrain Vehicle, SE Core ground trainer • Constructive: Leadership in OneSAF Army contract • Gaming: Gaming Center of Excellence • Physics Based Modeling: Foundation of Missile Defense M&S • MS&T Subject Matter Expertise – Top 3 in Live – Leadership in virtual & constructive • Composable simulated solutions • NATO C2…command & control modeling • Range systems and products • $6.5B mature, stabilized market with potential upside to $9B; $4B pipeline over next three years • M&S capabilities, technologies, and toolsets provide entry into emerging adjacent markets in cyber, energy, and medical modeling & simulation Modeling, Simulation, & Training Synthetic Env. Core Virtual Driver Trainers USMC Squad Immersive Training SAIC Capabilities Opportunities SAIC Differentiators Int’l Army National Guard Medical/ Energy/ Cyber Navy/AF Simulators Customers OneSAF |
 49 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. President’s Summary Leverage the power of our people, culture, and technology to drive our market position beyond services to delivering solutions
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 Intelligence, Security and Technology Stu Shea Group President |
 51 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Focused on the Mission 10-1230-IC-17 Protecting and Promoting Freedom |
 52 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IS&T Group Structure and Customers Intelligence and Information Systems Technology and Advanced Systems Mission Integration Space and Geospatial Intelligence Operations, Intelligence and Security Larry Cox $600M John Fratamico $700M John Hynes $500M Tony Moraco $550M John Thomas $800M Signals Intelligence, Cyber Security, Information Assurance, Tactical Integration S&T for Analysis, Design, Prototyping and Implementation of ISR and CBRNE Systems Intel Mission and Technical Support, Advanced Analytics and Linguistics, Education/Training National Security Space SE&I and Airborne Integration, GEOINT Production Defense Intel Operations Support, Intel Fusion, Identity Management • SAR • NCTC • ODNI • OSC • DIA • FBI • NGA • US Air Force • NRO • DIA • SAR • DARPA • US Navy • US Air Force (AFRL) • US Army (TEC) • DARPA • DTRA • DHS • US Army • US Air Force • US Navy • Combatant Commands • DIA • DHS • NSA • SAR • DISA • DHS • DSS • State/Local Note: All figures represent FY09 revenue $3,200M Intelligence, Security and Technology Group Stu Shea Group President |
 53 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IS&T Group Accomplishments Mission Success Down-Range Warfighter Support • Persistent surveillance • Intelligence processing, exploitation and dissemination • Biometrics/identity management Definitive Strategies Portfolio Management • Operating as an enterprise • From science to solutions • Cyber and ISR focus – high growth markets • Key wins, key acquisitions Execution Excellence Flawless Execution • High award fees • Strong fee generation Top and Bottom-Line Growth High Energy Business Development • 3-year revenue CAGR: >10% • 92% recompete win rate, 66% new win rate • Non-IDIQ pipeline: $14B, IDIQ pipeline: $9B • Submits awaiting award: $4.7B ($2.6B non-IDIQ, $2.1B IDIQ) Commitment to our People Commitment to our People • People First! Initiatives • Attrition <12% • >240 people redeployed |
 54 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Market Trends: Uncertainties and Opportunities Uncertainties • Economic malaise • New administration – Leadership voids / changes – Shift in war operations from Iraq to Afghanistan – Shift from global war on terror (GWOT) to overseas contingency operations • New procurement directions – Shifting / confirming defense priorities – Program restructuring, delays, and cancellations – Delays in contract awards / movement to IDIQ – Reductions in defense supplemental budgets – Acquisition and contract reform Opportunities • Cyber: Major administration priority – Landscape dominated by core customers with core contract enablers – Need for appropriately trained, experienced, and cleared cyber workforce – Products are not enough; moving to integrated, multi-faceted solutions – Solutions across .ic, .mil, .gov, and .com • ISR: Major administration priority – Significant emphasis on quick reaction capabilities (QRC) – 75% solution vs. exquisite system – State change with airborne ISR – Increased emphasis on ground operations – Finding disruptive technologies for NexGen – Risk reduction for current system upgrades – Being agile in a budget constrained environment |
 55 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Core Business Areas “A leader in the integration of technology, systems and operational solutions
across intelligence disciplines in all domains…air, land, sea, and
space…to deliver full spectrum mission performance.” 10-1230-IC-16 Science & Technology Intelligence Solutions Integration for Full Spectrum Mission Performance Cyber Security (Computer Network Attack, Defense, And Exploitation) Intelligence, Surveillance and Reconnaissance (ISR) |
 56 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Intelligence, Surveillance and Reconnaissance “A leader in the integration of technology, systems and operational solutions
across air, land, sea, and space to deliver full spectrum ISR mission
performance.” Surveillance and Reconnaissance Payloads for Air, Ocean and Space Platforms Airborne and Ground Based Collection Systems Ground Control Stations and Operations Centers Exploitation Systems and Tools Integration for Full Spectrum ISR Mission Performance 10-1230-IC-16 |
 57 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Cyber Security “A leader in the integration of technology, systems and operational solutions
across cyberspace in all its domains…air, land, sea, space… to deliver full spectrum mission performance.” Advanced Analytics and Operations (Exploitation, Defense, Attack) Managed Security Services (Network and Security Ops) Training and Education, and Accredited Testing and Evaluation Design and Build of Enterprise IT Solutions Integration for Full Spectrum Cyber Mission Performance 10-1230-IC-16 |
 58 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Intelligence Solutions “A leader in the integration of technology, systems and operational solutions
across intelligence disciplines in all domains…air, land, sea, and
space…to deliver full spectrum mission performance.” 10-1230-IC-16 Mission Support: Geospatial Production, Advanced Analytics and Linguistics Biometrics and Identity Management Integration for Full Spectrum Intel Mission Performance Intelligence analysis, threat assessments, counter-IED systems Systems Engineering & Integration (SE&I) for Complex Systems |
 59 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Mission Experience Integrated Systems Solutions R&D Prototypes Component, Systems & Subsystems Quick Reaction Capability Engineering & Analytic Support Thought Leadership People, Processes, and Tools Mission Operations The performance value chain Maturing Capabilities Deep Customer Understanding Cyber D2R Digital Echo RTRG CyberNEXS NOC/SOC 10-1230-IC-09 New Approaches to Augment Proven Ones • Expand and evolve our offerings – Sub to Prime Contractor – SETA to SE&I – Expand IP ownership – Prototypes to subsystems to systems solutions • Double-down on high- growth markets • Pursue more large, integrated systems solutions programs • Leverage entrepreneurial spirit – Expand intelligence solutions, science and technology – Focus on DARPA, IARPA and AFRL ISR TRITON Radiant Falcon Night Eagle Desert Owl Highlighter Buckeye Blue Devil Angel Fire 3GIRS, CHIRP DCGS-A GEAR |
 60 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. President’s Summary • We have a passion for executing the mission and a commitment to take on tasks of vital interest to the nation…our people are mission-critical • We have deep domain expertise in every mission area we support and we are the best at what we do… recognized national treasures walk our hallways • We apply creative science and disciplined engineering to create innovative solutions for our customers – people for whom we care and strive for their success • We work as imaginative, driven, entrepreneurial teams and we move mountains to deliver results • We share in our customers’ successes, and we thrive on the hard work that gets us there • At the same time, we take pride in our high ethical standards and joy in doing good deeds for our communities, families, friends, neighbors and fellow employees • Our work enriches us, and it is an honor to be part of SAIC 60 10-1230-IC-15 |
 Information Technology & Network Solutions Group Charles Koontz Group President |
 62 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Focused on the Mission Accelerating R&D by bringing partners together |
 63 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IT&NS Group and Customers • DHS • NASA • EPA Managed IT, Infrastructure Services and Software Development to DHS, NASA and Civilian Agencies • Sole Source Contractor for the National Cancer Institute Technology Development and Science Discovery for Diagnosis and Treatment of Cancer and AIDS • MHS • HHS • VA Health IT, Military Health and Public Health and Biomedical Research • BP • Scottish Power • Entergy Global Energy and Life Sciences Solutions and Integration Services Homeland and Civilian Solutions Doug Wagoner $600M Commercial Business Services Rex Ballard $500M Health Solutions Tony Hess $350M SAIC NCI / Frederick Larry Arthur $1,450M Revenue Information Technology and Network Solutions Group Charles Koontz Group President Note: All figures represent FY09 revenue |
 64 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IT&NS Group Accomplishments • Health – Leading Federal initiatives in VA/DoD data sharing and electronic health records – Established health information exchange (HIE) pilots in multiple regions – Expanded Footprint in Military Health IT, becoming the #1 Provider – Key player in Post-Traumatic Stress Disorder – National leadership in cancer and infectious disease R&D; $305M in ARRA funding for
SAIC-Frederick • Energy IT – Digital Oil Field success—BP renewal, growth at Chevron and Shell, and new accounts at TOTAL and
ADCO – Wins at Florida Power & Light and EDF (France) for asset management – Invited to bring our Smart Grid offerings to team with Sempra, Entergy, Oncor on their DOE/ARRA bids – Invested in beachhead market position in Middle East generating wins in ADCO and PDO (Oman) – Added new SAIC India contracts with Halliburton and Port Authorities in NY, NJ – 5-year sole source extension of IT outsourcing contract at Entergy • Federal Civilian – Double digit YoY growth against $9B DHS addressable market – Multiple extensions on our $220M NASA UNITeS contract – Won a large EPA program displacing an incumbent – IRS transformation thought leader – Awarded IDIQ supporting the FEMA CIO and Information Technology Division ($500M ceiling)
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 65 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. The Federal Health Market Today Health • Quality, Cost and Access to Care • Privacy of Health Data • Health IT Systems Standards • Translational Medicine - Improve R&D ROI “From Bench to Bedside” • Biosurveillance system development (NIH, CDC) • Vaccine development (PanFlu, Malaria, SMA, CBMS etc), • Nurse Advice Line (MHS) • Quality measures / comparative effectiveness research (CMS, AHRQ) • Fraud and abuse detection (CMS) • Telehealth infrastructure support (VA, IHS) • Reducing the stigma of seeking help for mental illness (PTSD/TBI — Armed Services) • HIPAA (MHS, VA, CMS) • Infrastructure modernization (CMS, NIH, CDC) • Grants management systems (NIH, CDC, HRSA) • NHSN — Adverse event / infection tracking systems (FDA, CDC) • EHR/EMR interoperability (VA/DoD Sharing, HIEs) / National Health Information Network (NHIN) (ONC) • Legacy systems modernization (VA, DoD) Customer Initiatives |
 66 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. • Electronic Health Records are one of the cornerstones of healthcare transformation • Health IT enables improvement in quality and access to care while supporting reduced costs • HITECH Act allocated $18B in EHR adoption incentives and created $2B in new funding for the Office of the National Coordinator (ONC) to facilitate the Nationwide Health Information Network (NHIN) Health IT: Electronic Health Record (EHR) Interoperability • Developing and supporting the operation of the Military Health System for 20+ years • Nationally recognized experts in interoperable health record systems standards • Unique insight into the VA and DoD EHR systems and their use • Internationally recognized thought leadership in meaningful privacy and security standards SAIC Differentiators • Health Data Management • Security and Privacy • Infrastructure Lifecycle Management • Systems Integration • Software Lifecycle Management Opportunities SAIC Capabilities • Current pipeline includes $568M in ARRA funded health opportunities with more anticipated • VA/DoD sharing is a Congressional priority and SAIC is positioning for a leadership role • Over the next five years, expect federal health IT market to exceed $20B and state and local market to exceed $9B HHS DVA MHS SSA OPM Customers Market Drivers |
 67 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. • Infectious diseases cause massive economic losses; monitoring and public awareness are critical to control costs and avoid loss of life • Seasonal flu and emerging variants form one of the most pressing global health problems today • Public health and infectious disease surveillance spending and research has grown to meet the challenge • EHR spending will drive biosurveillance spending as new data sources become available Public Health: Biosurveillance and Infectious Disease Control • HHS: NIH and CDC – National Institute of Allergy and Infectious Diseases – National Cancer Institute – Center for Disease Control and Prevention – BARDA • DoD USAMRAA and Chemical Biological Medical Systems • SAIC accessible market ~$2.8B in FY11 • Epidemiologists and biological scientists who understand this domain and create solutions that work • Laboratory information management • Data warehouse and data mart design and development • Statistical analysis and decision support • Years of experience building and operating nationwide biosurveillance systems gives SAIC staff valuable insight into what makes an effective system • Signature systems such as BioFlu — an open source system that graphically visualizes CDC approved flu data from various sources • Tools to quickly deploy and evaluate all types of flu data, including social networks and news feeds, at a fraction of the cost of proprietary solutions SAIC Differentiators SAIC Capabilities Opportunities CDC NIH Customers Market Drivers |
 68 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. • Combat Stress Education and Self- Help Strategies - Graphic novel (prepares personnel for service) • Naval Center for Combat and Operational Stress Control (Research, Communication Knowledge Management) • Mental Health Care Access Initiative Current Programs Market Drivers Military Health: Psychological Health Maintenance • Psychological Health Maintenance – Post Traumatic Stress Disorder (PTSD) – Traumatic Brain Injury (TBI) – Combat Stress, Depression, Suicide • Psychological health effects are the chronic disease of the war fighter • Approximately 30% of war veterans suffer from PTSD • 1.4 million sustain a TBI each year in the United States SAIC Capabilities • Behavioral Sciences and Epidemiology • Psychology • Physiology • Injury Prevention • Biomechanics Counseling • Family Therapy • Combat & Operational Stress • Training & Education Opportunities • Executing on a $100M+ pipeline • DVA requested $5B for behavioral health in FY10 • DoD services requested an additional $650M for behavioral health in FY10 • Exploring opportunities with NIMH and SAMHSA |
 69 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. HHS DVA MHS SSA OPM SAIC-Frederick Differentiators Major Focus Area Health Sciences: Translational Research and Personalized Medicine SAIC-Frederick Capabilities • Research and Bioinformatics • Biotechnology • Genetics and Genomics • Proteomics and metabolomics • Super computing and biological imaging • Taking a drug from discovery to market requires 15 years and costs $800M • Translational Medicine rapidly moves discoveries made at the “bench” to therapies at the “bedside” • Tomorrow’s therapies based on an individual’s biochemistry avoid serious adverse reactions to broad-based therapies in many patients • Translational & Personalized Medicine is the mission of the National Institute of Health – ARRA added $10B to NIH • Genomics, proteomics and metabolomics • Molecular diagnostics, and nanotechnology • Rapid development of vaccines and therapies for cancer, AIDS and other diseases • 1,750 full-time employees including highly skilled life scientists and physician scientists • Core corporate competencies in vaccine research and production and regulatory affairs • Molecular biology including genomics, proteomics and metabolomics • Bioinformatics and biomedical computing expertise Customers Market Drivers |
 70 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. President’s Summary Mission • Enterprise growth engine for Homeland Security, Federal Civilian, Health and Energy IT markets • Lead our health campaign march toward a ~$1B enterprise Strategy • Capitalize on health reform and market disruptions to fill “white space” opportunities • Commercial energy upstream oil and gas and utilities solutions development • Differentiate DHS & Federal Civilian offerings with mission driven IT
modernization |
 Infrastructure, Logistics, and Product Solutions Group Joe Craver Group President |
 72 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Focused on the Mission Boral Bricks – Energy Efficiency/Management MRAP Joint Logistics Integrator High Energy VACIS |
 73 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. John Ferriter $450M Alex Preston $200M J.T. Grumski $550M Glenn Sangiacomo $700M Chuck Zang $450M IL&PS Group Structure and Customers CBRN and Preparedness Services and Solutions Non-Intrusive Inspection and Radiation Detection Products Energy, Environment and Infrastructure Logistics and Support Solutions Systems Engineering, Mission Support, and OT&E • Commercial • Department of Energy • DoD • States • Defense Logistics Agency • US Army • US Air Force • US Army • DHS CBP • Department of Energy • International • NASA • AFOTEC • FAA • NOAA • US Army • DHS FEMA CDP • State/Local Homeland Protection and Preparedness Security and Transportation Technology Energy, Environment and Infrastructure Logistics and Engineering Solutions Science and Systems Engineering Solutions $2,350M Infrastructure, Logistics and Product Solutions Group Joe Craver Group President Note: All figures represent FY09 revenue |
 74 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IL&PS Group Accomplishments • Acquisition / Business Model / Branding Leadership for SAIC – Acquired R.W. Beck with Beck Disaster Recovery – Successfully integrating Benham acquisition – Executing BPL Global “smart grid” strategic alliance – Launched SAIC energy branding campaign • New Business Performance – Won DOE and DoD Energy Savings Performance Contracts ($5B / $50M) – Won MRAP Joint Logistics Integrator II Program ($450M), USMC CREW ($120M), and Army
Sustainment Command (ASC) Distribution Management Center (DMC)
($130M) – Maintained preparedness leadership position with key wins (CDP, Guardian II, CBRN PV
and JECP) • CDP ($104M), Guardian II ($250M), CBRN PV ($97M) and JECP ($40M) – Improved overall pipeline trends and win rates (increased logistics pipeline to over
$8B) • Execution Excellence – Completed Lake Erie Bio Fuels ($70M) & Boral Brick Bio Mass/Indiana Landfill Gas
($60M) Plants – Executing $110M NASA VTC Program by leveraging Design/Build/Systems Engineering
capabilities – Successful contract start up for DLA Tires and POLCHEM outsourcing contracts
– Developed and implemented High Energy Product Line and ASP – Continued leadership position in Military Force Protection NII and integrated
inspection |
 75 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IL&PS Group Strategic Focus • Global Climate Change – Water – Weather • Smart Power Primary Focus: Logistics Event Driven Energy HLS Option Value: Emerging Markets: 10-1230-IC-12 |
 76 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Customers Opportunities Market Drivers SAIC Capabilities / Differentiators Energy Campaign Commercial States Utilities Federal Local • Integrated Energy Management / Efficiency • Smart Grid Integration / Cyber Security • Design / Build • Energy IT / Digital Oil Field • Renewable Energy Project Implementation • Independent Engineering • Energy / Carbon Modeling • Due diligence and owner’s advisory for lenders, investors, and developers • Technology Evaluation • Water Management • Economy / Stimulus Impact – Smart Grid Acceleration – Distributed Energy Resources – Tax Credit Impact • Utility Delays • Carbon Cap and Trade • DOE Workload • Water Management Needs • Expand Energy Management / Efficiency Services • Capture Smart Grid Market Share • Alternative / Clean Energy Projects • Expand Engineering / Design/Build Presence • Sell-out DoE ESPC Contract Competition |
 77 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. Federal Civil DOD State & Local Commercial Int’l Opportunities Market Drivers SAIC Capabilities / Differentiators Homeland Security • Terror Event Timing • Secure Freight Initiative • Military Force Protection • Distributed Threat versus Point • Mexico Drug / Security • HLS / DOE Radiation Detection Strategy • Global Climate Change / Impacts • Shift to All Hazards • All Hazards Preparedness / CBRNE • Disaster Planning and Response • Training and Equipment • Logistics Support • Non Intrusion Inspection • Integrated Security and Engineering • Distributed Complex Program Management • Integrated Customer Mission Understanding • Expand attractive margin product solutions • Capture greater share of increased State and Local preparedness needs • Broaden our TSA footprint • Respond to event driven needs Customers Competition |
 78 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. DLA DOD Civil DHS Opportunities Market Drivers SAIC Capabilities / Differentiators Logistics Campaign • # 1 Defense Logistics Agency Prime Vendor / Integrated Supplier • Joint Logistics Integrator Model • PurchasePlace E-Procurement Platform • Global logistics network / presence supporting customer mission needs • Unbiased Integrator • DLA outsourcing and expansion • Weapon systems platform extensions • Large primes moving in aggressively • UAV proliferation lacks program of record and associated logistics support/ CONOPS • Product support integrator (PSI) • 75% solution in months versus 100% in years • Executing on $8B pipeline • Extending Joint Logistics Integrator concept to new customers • Capitalizing on logistics and sustainment focus across DoD/DHS Customers Competition |
 79 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. IL&PS Group Portfolio Management Professional Services Base Advanced Science Support and Engineering (SAIC Heritage) Product Leverage Larger Scale Systems Development and Integration Managed Services |
 80 Energy | Environment | National Security | Health | Critical Infrastructure © 2009 Science Applications International Corporation. All rights reserved. SAIC, the SAIC logo, and "From
Science to Solutions" are trademarks or registered trademarks of Science Applications International Corporation in the United States and/or other countries. President’s Summary Three Thrusts: Energy / HLS / Logistics Paying Off Focused On: Reducing Reliance on Traditional DoD Budgets Growth Moving to New Business Models / Approaches Customer Acceptance and Profitability Developing Leadership to Sustain Growth SAIL Program |