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November 4, 2021

Kratos’ Q3 2021 revenues drop 1.4% to $200.6m

In the third quarter of 2021, Kratos also incurred a net loss of $2.4m.

Kratos Defense & Security Solutions has posted a nearly 1.4% year-on-year (YoY) decline in quarterly revenues in the third quarter of this year.

In the three-month period that ended on 26 September 2021, the company’s revenues totalled $200.6m. The figure was $202m in the prior-year period.

The fall was primarily attributed to a $6.2m drop in legacy government services revenues to $11.2m. The company also recorded a $5.5m YoY revenue fall due to a drop in certain international contracts for the Training Solutions business.

However, revenue registered an organic increase of 5.8% on a pro forma basis, excluding the reductions.

Kratos also recorded a net loss of $2.4m in Q3 2021, compared to a profit of $2.4m registered in the same period a year ago.

Operating income decreased from $12.7m to $10.5m on a YoY basis. Adjusted EBITDA stood at $23.8m, down from $24.6m in Q3 2020.

In the third quarter of the year, Kratos’ Unmanned Systems Segment (KUS) revenues jumped 14.6% to $61.3m, while Kratos’ Government Solutions Segment (KGS) revenues fell from $148.5m to $139.3m.

Kratos’ Space, Satellite and Cyber business revenues increased to $72m in Q3 2021, compared to $61.3m.

Kratos president and CEO Eric DeMarco said: “Though we expect Covid-19 related, supply chain and customer issues the industry and Kratos are experiencing to continue, there is no change in Kratos’ expected up and to the right long term organic growth profile with increasing profit margins.

“Kratos is the growth leader in space, satellite communications and unmanned drone systems as reflected in our results today and our C5ISR, Rocket System and Next Generation Engine businesses are also positioned to be future growth leaders.”

The company added that it expects full-year revenue in the range of $805m-$815m.

In September, Kratos delivered the first batch of its OpenSpace quantum and SpectralNet products to Northrop Grumman for the US Army Tactical Intelligence Targeting Access Node (TITAN) space-ground system prototype.

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