ManTech (NYSE: MANT) sells technological services to the U.S. government in the fields of defense and intelligence. ManTech provides services in cyber defense and cyber security, information technology and intelligence operations, as well as systems engineering and testing and evaluation. ManTech operates in a business environment defined by two opposing trends and forces. First, defense and intelligence contracting is always in high demand - the U.S. government spends nearly a trillion dollars a year on defense spending. Conversely, government expenditures may decrease in the face of continuing economic concerns and cutting bloated defense contracts may be appealing to lawmakers.
ManTech's 29% increase in revenues for the 2010 fiscal year were driven by three acqusitions: Sensor Technologies, Inc. (STI), QinetiQ North America's Security and Intelligence Solutions, and MTCSC, Inc. These acquisitions were the primary drivers in the aforementioned increase in revenues as well as an approximately $36 million increase in operating income from 2009 to 2010.
In the aftermath of the September 11, 2001 terrorist attacks, the U.S. defense and intelligence services grew dramatically. As of 2010, the U.S. defense budget nears one trillion dollars, nearly doubling its decade-ago figures. As such, ManTech enjoys the reliability of government spending on defense issues and counterterrorism efforts.
Almost all of ManTech's revenue come from contracts with the U.S. government, especially in defense and intelligence. As U.S. economic concerns continue, lawmakers may be inclined to cut into the near trillion dollar U.S. defense budget. Such cuts would have second and third order effects in the private consulting industry, especially on companies such as ManTech that are reliant upon contracts for their revenues.
ManTech competes in a largely saturated, private industry that provides consultation services for the U.S. government. ManTech's main competitors include Booz Allen Hamilton (BAH), SAIC (SAI), Lockheed Martin (LMT), and Raytheon Company (RTN).