Growth of the Company: FY 2006

Fiscal Year 2006

Federal Computer Week ranked SAIC No. 2 among the Top 25 Systems Integrators and No. 3 of the Top GSA Schedule 70 Holders. INPUT ranked SAIC as No. 2 in the Federal IT 150. Government Executive ranked SAIC No. 3 among the Top 50 Technology Contractors, and Washington Technology ranked the company No. 3 among the Top 100 Federal Prime Contractors. Gartner Group/Dataquest ranked SAIC among the world's top 10 consulting and systems integrators and the world's top 20 IT service vendors.

September 1, 2005, SAIC announced its plans regarding capital restructuring and an initial public offering of common stock. SAIC filed a registration statement with the Securities and Exchange Commission (SEC) related to the initial public offering and filed a registration statement with the SEC concerning a proposed capital restructuring.

SAIC has won contracts for systems development services and for software and data analysis to support disease surveillance. The company's technical services continued to be used to support weather forecasting and warning, climate variability assessment, and Earth and space science. SAIC's information technology services were used by major power companies, and the company's systems were contracted for use in transportation and for noninvasive cargo, vehicle, and contraband inspection in various nations around the world.

SAIC was awarded numerous large federal government contracts during fiscal year 2006.

• A contract awarded to a team led by SAIC to provide system engineering and integration support for the Joint Mission Planning System by the U.S. Air Force's Electronic Systems Center, Mission Planning Systems Group.

• A contract awarded to SAIC subsidiary AMSEC LLC to provide engineering support to the U.S. Navy's Center for Surface Combat Systems.

• A contract to provide scientific, engineering, technical and administrative support to the Office of the Director, Systems Engineering, Office of the Secretary of Defense.

• A contract to maintain and enhance functionality for the health care information systems within the Military Health System.

• A contract to provide engineering and technical services to support the Air Force's Operational Test and Evaluation Center.

The sale of SAIC subsidiary Telcordia Technologies, Inc. was completed on March 15, 2005, to Providence Equity and Warburg Pincus. Several strategic acquisitions also were made, enhancing SAIC capabilities in homeland security, intelligence, and defense.

Related Information: SAIC Announces Financial Results for Fourth Quarter and Fiscal Year 2006.