Greetings. Welcome to Leidos' Fourth Quarter 2021 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. At this time, I'll turn the conference over to Stuart Davis with Investor Relations. Stuart, you may now begin.

Thank you, Rob. And good morning, everyone. I'd like to welcome you to our fourth quarter and full fiscal year 2021 earnings conference call. Joining me today are Roger Krone, our Chairman and CEO; and Chris Cage, our Chief Financial Officer. Today's call is being webcast on the Investor Relations portion of our website, where you will also find the earnings release and supplemental financial presentation slides that we'll use during today's call. Turning to Slide 2 of the presentation. Today's discussion contains forward-looking statements based on the environment as we currently see it and, as such, does include risks and uncertainties. Please refer to our press release for more information on the specific risk factors that could cause actual results to differ materially. Finally, as shown on Slide 3, during the call, we'll discuss GAAP and non-GAAP financial measures. A reconciliation between the two is included in today's press release and presentation slides. With that, I'll turn the call over to Roger Krone, who will begin on Slide 4.

Thank you, Stuart, and thank you all for joining us this morning. 2021 was a banner year for Leidos, with industry-leading organic revenue growth and expanded profitability. In addition, we enhanced our market presence during the year with strategic acquisitions and investments that added important technical capabilities. Despite the ongoing impact of COVID-19 and an extended Continuing Resolution, we are positioned to grow in 2022, bolstered by our scale, differentiated technical offerings, and dedicated workforce. In my remarks, I'll address four topics: our financial results and outlook, capital allocation, business development and people. Number one, our financial performance in the quarter was strong despite a challenging market. Revenues for the quarter were $3.49 billion, up 7% year-over-year. For the year, revenues grew organically across all reportable segments and were up 12% in total compared to 2020. In 2021, our adjusted EBITDA margin of 11% represented the sixth consecutive year of margin expansion and non-GAAP diluted EPS was up 14% to $6.62. We generated $210 million of cash flow from operations in the quarter and free cash flow of $177 million. For the year, that translates to $1.30 billion (sic) [$1.03 billion] of cash flow from operations and $927 million in free cash flow. These results came despite well-documented headwinds, most notably a protracted Continuing Resolution, which slowed both tasking on existing contracts and the award of new opportunities, a resurgence of the pandemic, which lowered workforce productivity and limited our interactions with customers, and a national security community transitioning to new threats. I am proud of how well the team weathered these headwinds. In 2021, we achieved our guidance for all of our metrics, but the standout metric was cash, which came in well ahead of our expectations through close coordination with our customers and strong operational focus. Our asset-light…

Thanks, Roger. And thanks to everyone for joining us today. With lots to cover, let's jump right into the results, beginning with the income statement on Slide 5. Revenues for the quarter were $3.49 billion, up 7% compared to the prior year quarter. Excluding acquired revenues of $52 million, revenues increased 6% organically. For the year, revenues were $13.74 billion, which was up 12% in total and 9% organically compared to 2020. In the quarter, we saw a continuation of the behavior that we cited on our Q3 call, where some customers, especially in the defense and intelligence sectors, worried about the extended CR and held back on funding. This was exacerbated by the limited ability to meet with customers with the onset of the Omicron variant and lower than anticipated direct labor given higher than normal paid time off usage by employees on cost reimbursable contracts. These factors led to revenues in the lower half of the guidance range that we gave on the last call. Turning to earnings. Adjusted EBITDA was $359 million for the fourth quarter for an adjusted EBITDA margin of 10.3%. Margins were down sequentially and year-over-year, consistent with our prior messaging, although higher than normal leave taking and lower than normal net favorable impacts from EACs lowered margins 20 to 30 basis points below our expectations. For the year, adjusted EBITDA was $1.51 billion, which was up 14% over fiscal year 2020. Adjusted EBITDA margin of 11% was an improvement of 20 basis points over 2020. In 2021, we benefited from a $26 million gain related to the Mission Support Alliance joint venture recorded in the first quarter and the backlog of disability exam cases that were pushed from 2020 to 2021 because of COVID. These two items added 60 basis points to the…

Thank you. We’ll now be conducting a question-and-answer session. [Operator Instructions] Thank you. And our first question comes from the line of Seth Seifman with JPMorgan. Please proceed with your question.

Hey, thanks very much, and good morning.

Hey, good morning, Seth.

Chris, I think if I caught the headwinds you mentioned, it probably, it sounds like it adds up to maybe $450 million or so for 2022. And I guess if you could outline the places where you expect to be able to offset that. Just given that, that by itself, it seems like a reasonable amount of headwind to overcome next year?

Sure, Seth. Thanks for the question. No, absolutely. I mean we're fortunate that going into the second year of the NGEN program, we have really strong visibility into how that program will continue to ramp up. And kudos to our team that's just done an excellent job getting that transitioned early. And now we're starting to see some of the project work that follows on to that program as well. So that's certainly one catalyst. We previously talked about the Military and Family Life Counseling program continuing to ramp up as we transition forward. Roger featured the thermal protection system program. There is several nice things going on within Dynetics that we're excited about, the IFPC program that we won in the third quarter, a thermal protection program. So those will both be transitioning into a growth mode. We had expected, obviously, we were hopeful RHRP would have been a big growth catalyst for us this year. We still expect it to be, but that's been pushed out for six months now. And then ultimately, one of the other big swingers will be what happens with AEGIS. We've modeled AEGIS to come in later in the year because we're anticipating potentially further action by the incumbent to delay that award. If they don't, that potentially gives us upside on the revenue line. But that's how we've positioned it within the guidance that we provided today.

Okay, great. Thanks. And then maybe just to dig in a little bit more. I know you guys don't guide by segment, but just for Health, you talked about the $80 million exam headwind. But just if we thought about Health at the overall level, just because it's been - that piece of the business has been running so hot, just thinking about the - even qualitative discussion about the overall level of growth or contraction in Health and the level of margin pressure?

Well, as we said, we do expect to be able to continue to grow our Health business. We have programs like DHMSM that continue to ramp up, which gives us a nice visibility there. Ultimately, RHRP will be an important contributor. But the 2022 revenue and profitability for the segment is consistent with what we've been trying to position, which is we knew that margins would be coming down. We had talked about potentially in the mid-teen area. We're on track with that expectation. The COVID case backlog has been worked down, but that particular line of business still performs excellently, we're very pleased with their performance. And there is a number of other large opportunities in the pipeline. But given the timing that we've seen on how procurements have been delayed, we're just being cautious about when those procurements might come out and our ability to win those and begin to execute.

Okay. Thank you very much.

Thank you.

Our next question comes from the line of Sheila Kahyaoglu with Jefferies. Please proceed with your questions.

Hey. Good morning, Roger, Chris, since Seth…

Good morning, Sheila.

…asked about the margins, I might as well ask about the balance sheet then. You both mentioned more aggressive with share repurchases. Obviously, that's deviating a little bit from your M&A strategy. So how do you kind of think about that? And what's your appetite for larger deals?

Hey, thanks, Sheila, and good morning. We're pretty transparent on the bigger deals. We're not really enthusiastic about what is out there. We - and we talked about this before, of course, Sheila, is that we've done some major transactions over the past several years and we're now performing against those. And our M&A is really focused on adding capability or access to a new customer, and those tend to be smaller. And barring something that really is transformative, our capital allocation is going to stay the way it has been, which is we invest in the company, we pay a dividend, we maintain our debt level and then we find a tax efficient way to give the excess cash back to our shareholders. And of course, we've said some things this quarter that indicate that we have less need for that cash. So take that as you will, but we are such a great cash generator. Our ability year-over-year to raise the dividend, buy back shares, I think, is impressive, and we're just saying we believe that will continue in the future.

And then maybe one on Civil segment. I think it declined in the quarter, and it was one of the - I think it was the lowest growth segment in 2021, but it's unlike your Analyst Day end market outlook. So can you kind of talk about what drives the reacceleration of growth in Civil and kind of your expectations there for 2022?

Well, I'll talk about a couple of things, and I'll let Chris follow. Civil is an area where protests and program delays really hurt us. We had a program named FILMS [ph], which is in protest. AEGIS was in protest. The FENS program at one time could have been a '21 award, and we thought it was a first quarter '22 and now it looks like it's a third quarter '22. So as we mentioned, both in my piece and in Chris, the delay of acquisitions have, I think, hurt the industry across the board. And for us, I think Civil took a major part of the brunt of that. But these - by the way, these programs are still going to happen. And so we're enthusiastic about our competitive position. The customer just has to get them through the acquisition cycle and they've got to get awarded and then we've got to sort our way through the protest period. And we mentioned with AEGIS, we don't know what's going to happen to AEGIS. Some of that upside, maybe that will get resolved earlier. But if there's another round of protest at Court of Federal Claims, it could be somewhere again. And then the Omicron variant kind of kept our security detection business sort of at nominative levels. We were hoping for a much stronger rebound in - frankly, in air travel and leisure, and although we have seen a rebound, but nowhere near what we had hoped. And I don't know, here in D.C., we'll look like we'll come off the back of Omicron, we have our fingers crossed, but I've said that before, and there could be another variant right behind it.

Yes. Sheila, the only thing I'd add, I mean Roger mentioned a few. We certainly continue to see a number of digital transformation, IT modernization opportunities within the Civil customer set. And those tend to be bigger and they tend to take longer to get through a decision process, but we like that aspect of the pipeline. But he also mentioned SD&A, and that will continue to be something that we're assuming is not a growth catalyst in the near-term, but positioning that for '23 and beyond.

Okay, thank you.

Yeah.

Next question comes from the line of Matt Akers with Wells Fargo. Please proceed with your questions.

Hey. Good morning, guys. Thanks for the questions…

Hey, good morning.

Morning.

I was wondering if you could comment on the long-term 5% to 6% organic growth target. And just if you could give us maybe sort of a walk of what are kind of the biggest things. I know you mentioned some of the - I think at Civil in the last question. But if you just can sort of kind of bridge the gap from '22 growth to where you think it will be longer term?

Well, I'll mention a couple of things and I'll let Chris add. But the Defense Enclave Services, if you were around the office, you will know what we're talking about in the hallways, I mean we were right up against that award. And that's a - it's just a large program, I can't underestimate how big that program is. And there's another competitor, and it's a very competitive program. And we're hoping that it will be a first quarter award with probably at least a 100 day protest, maybe more than that. And so that will start to ramp, assuming we win that later in the year. And then Chris touched on a couple of things. RHRP will start ramping. We'll get a full year of maybe NextGen. So there's a lot that can happen for us that's very, very positive. But here we are in the first quarter frankly with a fair amount of uncertainty. And you saw where we are on the guide, it's a nice range on the guide. We're going to do everything we can to get to the high end of that. But with the CR and Omicron and Ukraine and everything else that's going on, we thought positioning ourselves where we did was the right thing to do.

That's right. Matt, just a couple other things I'd mention. Again, as we look towards that 3 year time horizon, especially '23 and '24, I talked about a couple of the Dynetics programs, we continue to be excited about the positions on prototype programs that they're winning, which ultimately we have every expectation will turn into more full scale production programs and those could be significant growth catalysts for those out years. The return of the aviation screening market, again, cautious outlook in 2022, but we're several hundred million dollars below levels pre pandemic for that combined business as far as the top line goes. So that could be a future growth catalyst area. And then Roger mentioned a couple of the big programs that we're tracking, whether it be DES or FENS, AEGIS, and there's many more in the pipeline. So that's how we kind of think about it. There's several things that we anticipate over the course of this year will position us for accelerating our growth rate. But until we can bring those things in with more visibility, we'll be cautious on the near term outlook.

Great. That's helpful. And I guess is there any more you can tell us on - you mentioned the issue that you discovered late last year of potential FCPA violations. Is there anything more you can give us on the magnitude or when that might get resolved?

Yeah. We wish we could. But when you have these open investigations, we're really restrained on what we can tell you. So - and I think Chris pretty much paraphrased the paragraphs you see in the litigation section in the K. But what we will tell you is when we have more to tell you, we'll let you know. But right now, it's an open investigation and we're proceeding. And sometime in the future, we'll have more to say.

Understood. Thanks.

Yeah.

Our next question comes from the line of Gavin Parsons with Goldman Sachs. Please proceed with your questions.

Hey, good morning.

Hey. Good morning, Gavin.

Chris, I appreciate all the color on the revenue bridge on the headwinds and tailwinds. Could you help us quantify the impact this year of, assume full quarter of a CR, the procurement delays, the COVID-related utilization, any of those other headwinds that aren't the program specific numbers you just gave us?

Well, it's all kind of tied in. As we thought about that, we took a view of when decisions might be made on some of the new programs that we're chasing and also kind of really layering in what we saw in the third and fourth quarter as far as lower than normal activity on kind of on-contract growth activity, Matt - or Gavin. So again, it's more of a point-by-point as we thought through our pipeline and award timing and decisions. But obviously, where we position kind of the mid-point of the growth, all those things considered, shaved a couple of points off of where we ordinarily might have been.

Got it. So then maybe to Roger, how do you think about the level of conservatism that, that does encapsulate kind of given how unpredictable a lot of these headwinds have been? But it also sounds like maybe you're assuming some contribution from DES, which could be a coin flip. So how are you thinking about the level of conservatism that you've baked in here?

Well, we really want, especially with everything that's going on this year, we want to be in a really balanced position here in the first quarter. And then as these decisions, we need to get an omnibus, we need to get some of these programs awarded, as we can release that risk, then - your words, not mine, conservatism, I would rather call it balance, we can rebalance where we are throughout the year. And there are just so many multibillion-dollar opportunities ahead of us that with potential for another COVID variant, I think we're going to get an omnibus. But if not, I mean, there's still people in Washington saying there could be a potential government shutdown. And here we are, and we haven't even had the State of the Union or the skinny budget by the President. So there's a lot of uncertainty here in D.C. if you listen to radio. And so we just want to be in a position where we've got a good range, and we can work away up in the range as these risk items get released.

Got it. I appreciate it. And a quick clarification to just Matt's question. Is 5% to 6% still the right 3 year range? Or should we think of this year as normally disrupted and it's 5% to 6% after '22?

Yes. We haven't - Gavin, at this point in time, we're not changing kind of that 3 year CAGR outlook, right. There's lower starting point than we had anticipated given the dynamics that have played out over the last couple of months, but as we pointed to many paths to continue to get there. And as we resolve some of these major swingers such as DES and others in the near term, hopefully, we'll be able to give you more clarification on that 3 year outlook.

Got it. Thank you.

Our next question is coming from the line of Robert Spingarn with Melius Research. Please proceed with your question.

Good morning.

Morning.

Morning, Robert.

So yeah, hey, I don't know if Roger or Chris, which one of you want to take this, but we talked about '22 being a bit of a transitionary year from a revenue perspective. I wanted to try, with COVID lingering and the CR going into March, I wanted to ask the question from a margin perspective. And you've got Civil, which improved a little sequentially, but it's still down on the security detection. How do you think about the segment margins in '22? And how does that compare to normal?

Well, I'll start and Roger might have some thoughts here, too, Robert. I would say that we've been signaling for some time now that Health was running at an elevated level and that was going to moderate down. And I'll tell you that the conversations we've been having internal to the business around the other lines of business have been around margin expansion opportunities and where are those going to come from and what actions are we taking. And so as we built our 2022, we're finding opportunities and challenging the business leaders to drive margin expansion across their portfolios. And we're doing that in a thoughtful and balanced way but have good confidence on the levers to pull to make that a reality over time. So I think that's what you should continue to see, is a little bit more rebalancing of the margins across the portfolio and then getting the Health group to a position that is stable, that we can grow off of there. And so that's the way '22 should play out for you as far as margins go.

And Rob - go ahead and ask your question.

I didn't want to interrupt you, Roger.

No, Rob, I don't want to interrupt you.

Well, longer term, getting back to like an 11% type of number, what time frame should that be?

Well, for Civil, if you're talking about Civil specifically, I mean, it gets to 11% if there's a significant rebound across our aviation screening market, right. That's critical to that portfolio, and that's an above average margin piece of the portfolio, the volume needs to increase there. As we've signaled, we're hopeful, at this point in time, we'll see that continuing to get to those levels starting in 2023 and growing from there. But the core aspects of the portfolio wouldn't be 11% without a decent contribution across the security products business.

Rob, I'll make the point that I was going to make earlier. You raise margin in our business, really two ways, right, through operating performance, being more efficient, scale, being able to spend less capital, less R&D, less marketing because you have size, right. And we've been on that journey, and you've seen some real benefits from that. The other way you can raise margin in our business is you change your mix, right. We don't bid on relatively low LPTA 3% bids, and we bid on highly value-added differentiated programs like the thermal protection system. But if you've got a contract that's 4 or 5 years to support a mission where you're doing maintenance operations and maintenance work, those things have to roll off so the portfolio mix doesn't change as quickly as perhaps you would like or perhaps our investors would like. And by the way, those are good contracts and they generate a lot of cash and they help us build relationships with customers. So we have been moving over time really on both fronts, operating better, being more efficient, using our discretionary funds better. But also, if you will, moving up on the value chain and bidding on more differentiated work and then shying away from things that are LPTA and more commodity.

Okay. And Chris, when I mentioned the 11%, I was thinking enterprise-wide, just...

Yes, Rob, well, you're challenging me today then on 11% for the enterprise, well, that was a great year last year, as we pointed to. 60 basis points came from a couple of items that aren't going to repeat. We signaled 10.5% as our long-term target at Investor Day. Again, our expectation is to get to that level and then - and we do believe, as Roger pointed out, depending upon the mix in the portfolio, continuing to pursue areas, contracts, work areas that will give us margin expansion opportunities from there.

Got it, got it. Thank you, both.

Thank you.

Thanks, Rob.

The next question comes from the line of Colin Canfield with Barclays. Please proceed with your questions.

Hey. Good morning, guys. Thanks for the question. So just a follow-up first on Matt and Gavin's question. With respect to the headcount growth and kind of your organic targets that are applying FY '23, FY '24 of mid single digit to high single digit. Can you just talk us about - talk to us about the headcount growth assumed in getting into that accelerated organic growth rate?

Well, yeah, I mean, we can. Let's see, we don't really put out numbers, but we obviously have to add heads. We're at about nominally 43,000. The exact number will be in the K, maybe just a little short of 43,000 by like 20 or 30. And we have to add a significant number of people in the thousands, again, without putting out a specific number. And I think your question is really more of the risk around being able to continue to attract people to the company. And we - that's something actually, as a leadership team, we look at literally every week. And when you look at the number of people that we've hired and the people who have left, either the great resignation who have left the industry or retired or the people that have gone to competitors. And we are still comfortable with our ability to attract and retain the workforce that we need. The other question we usually get is about wage inflation, and I'll just hit that one, is that, we have seen a little bit of uptick in what we're paying people. It's all based in our numbers and our guidance. But we're also seeing the opportunity to hire some college grads at a lower wage rate. And frankly, some of the skills we need are coming right out of college, like Python programming language. And so that allows us to bring in some earlier career people into our cost structure which has a beneficial effect. So we always say that the workforce is a risk item for us, but we've been fortunate to create a company and a culture where people want to come to work. And we - frankly, our first six weeks of the year have been pretty impressive on the hiring that we've already done in 2022.

Colin, the only thing I would add to Roger's comment, and he's right, it is thousands of employees, but it's not - doesn't have to grow at the same rate as revenue because some of the things we pointed to for the '23 and '24 catalysts are going to come more on the manufacturing product side, those production programs in Dynetics and the return of the SD&A business market that we expect. Those don't require the same level of headcount growth contributions to drive that revenue uplift. So it's a big challenge, we're focused on it, but it's not a one-for-one relationship to get to the outcome.

Got it. Thanks. And then with respect to the margin question, kind of following up to Rob's vein of thinking, both you and CACI are assuming that you can mix shift kind of into better work. Can you just talk us about what sort of competitive win rate you're assuming on hardware type contracts and kind of where Leidos competes on price versus capability?

Let's see. I'm not sure I even know the number on hardware versus digital transformation. I'll describe just a little bit. The acquisition process for us on hardware is very, very different than, say, some of our large digital transformation opportunities. The large digital transformations are a lot of bidders, RFP process, draft RFP, competitive bid, maybe down selected to then a competitive bid. On the hardware side, it starts with spending our own R&D to create a concept and investing in a prototype or a demo or a simulation and then maybe getting a CRADA, like a cooperative research program where we take it out in the field and we shoot a prototype and we get a customer interested in it. And eventually that leads to a limited production order, which can actually lead to a large production order. So for us, I can't speak to the other people in our industry, in the areas where we compete, we're really competing off of differentiated technology that we've developed. Very rarely are we taking our widget against somebody else's widget and a third-party's widget and we're fighting it out in the proposal process, which, again, is typically in our large digital transformation jobs, how we win there. And it's why we like some of this in our mix. If you followed our story over the long term, we've said we would like a little bit more product, a little bit more hardware, where we can invest in a differentiation and then we can reap the benefits of that over the long-term.

The only other thing I'd add there, Colin, is on the differentiation front, the other attribute that allows us to be successful is speed. And we've talked about that, but we're more nimble, we're more agile. And so sometimes as we're looking at positioning for emerging capabilities, our ability to get that delivered and fielded more quickly, because we can respond more quickly, is a characteristic that allows us to be successful.

Yeah. Just an example there, because you can tell that we're really excited about this part of our business. We had a customer who needed an airborne asset. And we went from concept to delivery within 12 months. So we bought the airplane, we minded [ph] the airplane, we put equipment in, the customer gave us some GFE, we went through a test program, we got and fielded within 12 months. And that speed, security and scale, we think, is one of our differentiators.

Thank you. Next question comes from the line of Mariana Perez Mora of Bank of America. Please proceed with your questions.

Good morning, everyone.

Morning.

So 1% to 4% organic growth, what makes you confident that this is just a slow start and you could get to the mid-single digits growth in the next 3 years and this is not a new normal from a macro environment? So in other words, given this uncertain environment, why not under promise and over deliver?

Well, we're only giving '22 guidance today, right? And so we're trying to make sure that based on the factors we've seen, Mariana, over the last 4 months, it reflects those challenges that we see. But at the same time, we also see these needs and these opportunities in the pipeline. And so as we sit here today, we look at where our customer is going and the things that we think ultimately they will be buying and the demands that they have and the funding levels that we believe will be there still give us the ability to achieve that longer term aspiration that we have for growth. But for right now, '22, you're right, it is a little bit more of a cautious start given the uncertainty in the environment today. But we try to paint a picture of how that could increase our growth rate over time, depending upon how some of these uncertainties resolve themselves.

Yeah. And Mariana, we've talked about this in the past, is we have been trying to position the company to where we think the puck will be in the future. So - and as we look at the omnibus, we think there's going to be an even greater growth in non-defense. So that will benefit us in our Health and Civil business, which we have bolstered over the past several years. And then within Defense, the shift to great power competition, which we think benefits things like space and hypersonics and electronic warfare, again, areas that we have been positioning now for years. And so we're enthusiastic about the long term. In first quarter of 2022, there's just a lot of risk that needs to be retired which is why we are where we are.

Thank you. And then could you please discuss on competitive dynamics [indiscernible] win rate [ph] some pricing pressure being affected as more industry players are also doing the scale and sculpt strategy?

Competitive dynamics, so I would say that it's the same competitors that we go up against typically. And we're - we have a great team leading our business development, great capture managers, a good price to win team. We think we have a good pulse on what each procurement competitive set looks like, and so each one is different. To Roger's earlier point, we do try to steer away early in the process in our pipeline of things that we believe are only going to be based upon a price oriented decision, that's not where we want to compete. But clearly, I mean, the market is always competitive and we approach it that way. So there's no different - we're not taking our eye off the ball, we always go after everything, anticipating that it's going to be highly competitive, we need to put our best foot forward. And so that's the way we've been prosecuting the bids in our pipeline.

Thank you very much.

And Rob, it looks like we're coming up to the top of the hour, I think we have time for one more question.

Yes, that question will be coming from the line of Tobey Sommer with Truist Securities.

I was wondering if you could give us a perspective on the proportion of your business up for re-compete this year and next and how that may inform the aperture that you have in your business development pipeline to look for new and takeaway work?

Hey, Tobey, this is Chris, and Roger can add some more color. I would say it's actually a lower-than-normal year in '22, and so that kind of informs our internal goal on what we think our book-to-bill needs to be and what our target is. So absolutely, it's an increased percentage of takeaway and new business opportunities that we're going after, ad that comes with lower expected win rates. So we have to be very thoughtful about the volume that we're prosecuting through. And certainly, we don't take our eye off the ball on any re-competes and put our best foot forward. But it is a lower than average year, which is great. So we're definitely more on the attack in '22 than we might ordinarily be.

Would that hold true for '23 as well?

I would tell you that we haven't probably broken that down with great visibility yet. I mean there is not one of our top 10 programs that come to mind that are coming up for a re-compete cycle next year. So -- but more color on that as we get our way through the year, Tobey.

Okay. Thank you.

Thank you.

Thank you. I will now turn the floor back to management for closing remarks.

Thank you, Rob, for your assistance on this morning's call. And thank you all for your time this morning and your interest in Leidos. We look forward to updating you again soon. Have a great day.

This will conclude today's conference. Thank you for your participation. You may now disconnect your lines at this time.