Parsons Corp (PSN) Reports 25% YoY Revenue Growth and 60% Increase in Net Income in Q3 2023
Parsons Corp (NYSE:PSN) reports a 25% YoY increase in revenue, reaching a record $1.4 billion in Q3 2023.
Net income for the quarter increased by 60% to $47 million.
Adjusted EBITDA of $128 million, marking a 24% YoY increase.
Record cash flow from operations of $204 million, a 47% increase over the prior year period.
Parsons Corp (NYSE:PSN) announced its financial results for the third quarter ended September 30, 2023, on November 1, 2023. The company reported record revenue of $1.4 billion, marking a 25% increase year-over-year (YoY). Net income for the quarter rose by 60% to $47 million, and adjusted EBITDA increased by 24% YoY to $128 million. The company also reported a record cash flow from operations of $204 million, a 47% increase over the prior year period.
CEO Commentary
We delivered record quarterly results in total revenue, organic revenue growth, and operating cash flow, and reported strong net income and adjusted EBITDA. We also achieved over 20% organic growth in both segments for the second consecutive quarter, adjusted EBITDA growth of nearly 25%, a double-digit increase in contract awards, and over $200 million in quarterly cash flow for the first time in our companys history. said Carey Smith, chair, president, and chief executive officer.
Financial Performance
Parsons Corp (NYSE:PSN) reported a 25% increase in total revenue for the third quarter of 2023, primarily driven by organic growth of 23% due to the ramp-up of recent contract wins and growth on existing contracts. The company's net income increased by 60% to $47 million, and adjusted EBITDA increased by 24% over the prior year period to $128 million.
Segment Results
In the Federal Solutions segment, Q3 2023 revenue increased by 26% compared to the prior year period due to organic growth of 23% and $18 million from the company's Sealing Technologies acquisition. In the Critical Infrastructure segment, Q3 2023 revenue increased by 24% compared to the prior year period due to organic growth of 24% and the inorganic revenue contribution from the company's IPKeys acquisition.
Key Performance Indicators
Parsons Corp (NYSE:PSN) reported a book-to-bill ratio of 1.0x on net bookings of $1.4 billion and a trailing twelve-month book-to-bill ratio of 1.2x on net bookings of $5.9 billion. The company's total backlog increased by 7% from Q3 2022 to $8.8 billion.
Fiscal Year 2023 Guidance
The company is increasing its fiscal year 2023 revenue, adjusted EBITDA, and cash flow from operations guidance ranges to reflect its strong third quarter operating performance, Sealing Technologies acquisition, and its outlook for the remainder of the year.
Conclusion
Parsons Corp (NYSE:PSN) reported strong financial results for Q3 2023, with record revenue, net income, and cash flow from operations. The company's performance was driven by organic growth in both its Federal Solutions and Critical Infrastructure segments, as well as strategic acquisitions. Looking ahead, the company has increased its guidance for fiscal year 2023.
Explore the complete 8-K earnings release (here) from Parsons Corp for further details.
This article first appeared on GuruFocus.
