8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 21, 2005

ORBITAL SCIENCES CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Delaware	1-14279	06-1209561
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

21839 Atlantic Boulevard, Dulles, Virginia 20166

(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: (703) 406-5000

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

1

Item 2.02    Results of Operations and Financial Condition.

     On April 21, 2005, Orbital Sciences Corporation announced its consolidated financial results for the first quarter ended March 31, 2005. A copy of the company’s press release is furnished herewith as Exhibit 99.1.

     The information contained in this report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ORBITAL SCIENCES CORPORATION (Registrant)
Date: April 21, 2005	By:	/s/ Garrett E. Pierce
		Garrett E. Pierce
		Vice Chairman and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Orbital Sciences Corporation Earnings Press Release dated April 21, 2005.

EX-99.1

Exhibit 99.1

NEWS RELEASE
For Immediate Release	For More Information Contact:
	Barron Beneski (703) 406-5528
	Public and Investor Relations
	beneski.barron@orbital.com

ORBITAL REPORTS FIRST QUARTER 2005 FINANCIAL RESULTS

— Revenues Grow 10% on Satellite and Launch Vehicle Sales Increases —

— Company Announces New $50 Million Securities Repurchase Plan —

(Dulles, VA 21 April 2005) — Orbital Sciences Corporation (NYSE: ORB) today announced its financial results for the first quarter of 2005, reporting strong revenue, operating income, net income and cash flow results. The company also announced its intentions to repurchase up to $50 million of its outstanding securities during the next 12 months.

Orbital’s first quarter 2005 revenues were $167.1 million, up 10% over first quarter 2004 revenues of $151.4 million. Operating income was $12.2 million, as compared to $14.2 million in the same quarter last year which included a $2.5 million non-recurring gain.

First quarter 2005 net income was $6.2 million, or $0.10 per diluted share. Adjusted net income* for the first quarter of 2005, which excludes non-cash income tax expense, was $10.1 million, or $0.16 adjusted diluted earnings per share*, compared to net income of $11.5 million, or $0.18 diluted earnings per share, in 2004. Orbital reported first quarter 2005 free cash flow* of $5.1 million.

Commenting on the first quarter of 2005, David W. Thompson, Chairman and Chief Executive Officer, said, “The company started the year with solid operational, new business and financial performance. Our launch vehicles business segment exhibited a strong gain in operating profit and our satellites segment continued its robust revenue growth.” He added, “While Orbital continued to invest in growth opportunities in these businesses, the company also received approval from its Board of Directors to deploy some of our expanding cash balances to extend our program to buy back stock or notes during the coming year.”

^* “Free cash flow,” “adjusted net income” and “adjusted diluted earnings per share” are non-GAAP financial measures discussed in this release. For additional details, please refer to the section of this press release entitled “Disclosure of Non-GAAP Financial Measures.”

—more—

Orbital Sciences Corporation s 21839 Atlantic Blvd., Dulles, VA 20166 s 703-406-5000

Orbital Reports First Quarter 2005 Financial Results
Page 2

Financial Highlights

     Summary financial results were as follows (in millions, except per share data):

	First Quarter
	2005		2004
Revenues	$	167.1	$	151.4
Operating Income		12.2		14.2
Net Income		6.2		11.5
Diluted Net Income per Share	$	0.10	$	0.18

Supplemental Financial Information

In the fourth quarter of 2004, the company reversed most of its deferred tax valuation allowance. As a result, the company recorded substantially higher income tax expense in the first quarter of 2005, including significant non-cash income taxes. The following information presents the company’s adjusted net income for the first quarter of 2005, which is determined by adding back the portion of income tax expense that is offset by net operating loss carryforwards and other deferred tax assets. These supplemental results are provided so investors can more easily compare 2005 net income to 2004 net income, in which no such income tax expense was recorded (see the section of this press release entitled “Disclosure of Non-GAAP Financial Measures”) (in millions, except per share data):

	First Quarter
	2005		2004
Reported Net Income	$	6.2	$	11.5
Add Portion of Income Tax Expense Offset by Net Operating Losses and Other Deferred Tax Assets		3.9		—
Adjusted Net Income	$	10.1	$	11.5
Adjusted Diluted Earnings Per Share	$	0.16	$	0.18
Diluted Shares		63.5		65.4

Revenues

Revenues by segment for the first quarter were as follows (in millions):

	First Quarter
	2005			2004
Launch Vehicles	$	80.0		$	76.5
Satellites and Related Space Systems		82.4			69.4
Transportation Management Systems		7.0			7.3
Eliminations		(2.3	)		(1.8	)
Total Revenues	$	167.1		$	151.4

Orbital’s first quarter 2005 revenues were $167.1 million, up 10% over first quarter 2004, primarily due to a 19% revenue increase in the company’s satellites and related space systems

Orbital Reports First Quarter 2005 Financial Results
Page 3

segment and a 5% revenue increase in the launch vehicles segment. The satellites and related space systems segment growth was driven by significantly higher revenues from science, technology and defense satellite contracts, offset partially by lower revenues in the company’s communications satellites product line. The launch vehicles segment growth was driven by higher revenues in the missile defense interceptor launch vehicles and target launch vehicles product lines which were partially offset by lower space launch vehicles product line revenues.

Operating Income

Operating income by segment for the first quarter was as follows (in millions):

	First Quarter
	2005		2004
Launch Vehicles	$	9.0	$	6.9
Satellites and Related Space Systems		2.8		4.5
Transportation Management Systems		0.4		0.3
Corporate and Other		—		2.5
Total Operating Income	$	12.2	$	14.2

Orbital reported operating income of $12.2 million in the first quarter of 2005 compared to $14.2 million in the first quarter of 2004. The first quarter of 2004 included a $2.5 million non-recurring gain from the sale of notes received from a former affiliate reported in the corporate and other segment. Excluding this non-recurring gain, operating income grew $0.6 million quarter over quarter, due to a 30% increase in launch vehicles segment income, partially offset by lower income in the satellites and related space systems segment. The increase in launch vehicles segment income was largely attributable to the absence in 2005 of an unfavorable profit adjustment on a Taurus rocket contract in the first quarter of 2004. The decrease in satellites and related space systems segment income was due to lower operating results in the communications satellites product line, partially offset by higher income from science, technology and defense satellite contracts consistent with the revenue growth in this product line. The decline in communications satellites operating results was due to lower activity in 2005 on certain communications satellites which are nearly complete and an operating loss on a communications satellite contract awarded late in 2003.

Net Income

Net income for the first quarter of 2005 was $6.2 million, as compared to $11.5 million in the first quarter of 2004. Adjusted net income, which excludes $3.9 million of non-cash income tax expense, was $10.1 million, or $0.16 adjusted diluted earnings per share, for the first quarter of 2005. First quarter 2005 adjusted net income increased $1.1 million, or $0.02 per share, compared to the first quarter of 2004 excluding a one-time $2.5 million gain.

Orbital Reports First Quarter 2005 Financial Results
Page 4

Cash Flow and Balance Sheet

The company reported free cash flow of $5.1 million for the first quarter of 2005. Orbital’s unrestricted cash balance was $130.9 million as of March 31, 2005. The company’s cash flow was as follows (in millions):

	First Quarter
	2005
Net Cash Provided by Operating Activities	$	9.5
Capital Expenditures		(4.4	)
Free Cash Flow		5.1
Repayment of Debt and Other		(0.1	)
Proceeds from Issuance of Common Stock		0.4
Net Increase in Cash		5.4
Beginning Cash Balance		125.5
Ending Cash Balance	$	130.9

     Summary balance sheet data as of March 31, 2005 was as follows (in millions):

Assets			Liabilities and Equity
Cash and Equivalents	$	130.9	Short-Term Debt	$	0.1
Other Current Assets		206.9	Other Current Liabilities		141.2
Property and Equipment		83.3	Long-Term Debt		126.0
Goodwill		55.6	Other Non-Current Liabilities		0.6
Other Assets		191.7	Stockholders’ Equity		400.5
Total Assets	$	668.4	Total Liabilities and Equity	$	668.4

New Business Highlights

Since the beginning of 2005, Orbital has received approximately $260 million in new firm and option contract bookings. Major bookings included a new commercial communications satellite contract with PanAmSat Corporation and a contract selection to develop and build a NASA-sponsored scientific satellite for Southwest Research Institute. In addition, the company received approximately $30 million of option exercises under existing contracts. As of March 31, 2005, the company’s firm contract backlog was approximately $1.05 billion and its total backlog (including options, indefinite-quantity contracts and undefinitized orders) was approximately $2.38 billion.

Operational Highlights

Since the beginning of the year, Orbital has carried out six space missions, including a target vehicle launch in February and another target launch in March, plus two space launches, one target launch and one spacecraft operation so far in April. The company also completed and delivered several additional launch vehicles for future uses and completed two transportation management systems contracts since the beginning of 2005.

Orbital Reports First Quarter 2005 Financial Results
Page 5

Securities Repurchase Program

In April 2005, Orbital’s Board of Directors authorized the purchase of up to $50 million of the company’s outstanding securities over the next 12 months. This repurchase program replaces the program announced in 2004 which expires this month. The company may repurchase its 9% senior notes due 2011, common stock or common stock warrants that expire in 2006, or a combination thereof. Shares of common stock may be purchased from time to time in the open market, block purchase or negotiated transactions. The warrants and notes may be purchased in negotiated transactions. The timing, amount and type of securities to be repurchased will be determined based on the company’s loan covenants, market conditions and other factors. The following outstanding securities are subject to the repurchase program: $126 million of 9% senior notes due 2011; 55.6 million shares of common stock; and approximately 82,000 warrants to purchase approximately 10.0 million shares of common stock with an exercise price of $3.86 per share that expire in August 2006.

2005 Financial Guidance Update

The company reaffirmed its financial guidance, indicating that it expects that 2005 revenues will be in the $700 to $725 million range and operating income margin will be in the 8.0% to 8.5% range. Including non-cash tax expense, the company forecasts 2005 diluted earnings per share in the $0.40 to $0.45 range, based on estimated average diluted shares of 65 to 67 million. The company expects free cash flow of $40 to $45 million for 2005.

Disclosure of Non-GAAP Financial Measures

The following are provided as definitions of non-GAAP (Generally Accepted Accounting Principles) financial measures used by the company within this press release. Orbital does not intend for the information to be considered in isolation or as a substitute for the related GAAP measures. Other companies may define these measures differently.

Free cash flow is defined as GAAP net cash provided by operating activities (the most directly comparable GAAP financial measure) less capital expenditures for property, plant and equipment. Management believes that free cash flow provides investors with an important perspective on the company’s liquidity, financial flexibility and ability to fund operations and service debt.

Adjusted net income as presented within this press release is computed as GAAP net income (the most directly comparable GAAP financial measure) excluding the portion of income tax expense that will be offset by net operating loss carryforwards and other deferred tax assets. Adjusted diluted earnings per share is equal to adjusted net income divided by diluted shares. Management believes these measures provide investors with a more complete understanding of the company’s financial performance in comparison to prior periods.

About Orbital

Orbital develops and manufactures small space and rocket systems for commercial, military and civil government customers. The company’s primary products are satellites and launch vehicles,

Orbital Reports First Quarter 2005 Financial Results
Page 6

including low-orbit, geosynchronous and planetary spacecraft for communications, remote sensing, scientific and defense missions; ground- and air-launched rockets that deliver satellites into orbit; and missile defense systems that are used as interceptor and target vehicles. Orbital also offers space-related technical services to government agencies and develops and builds satellite-based transportation management systems for public transit agencies and private vehicle fleet operators.

A transcript of the earnings teleconference call will be available on Orbital’s website at http://www.orbital.com/Investor

2005 Annual Stockholders Meeting

Orbital’s annual stockholders meeting will be held at 9:00 a.m. on Thursday, April 28, 2005, at the company’s headquarters in Dulles, Virginia. The company will webcast the live audio of the meeting and post any presentation materials on its website at http://www.orbital.com/Investor

“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995

Certain statements in this press release may be forward-looking in nature or “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, trends and uncertainties that could cause the actual results or performance of the company to be materially different from the forward-looking statement. Uncertainty surrounding factors such as continued government support and funding for key space and defense programs, product performance and market acceptance of products and technologies, as well as other risk factors and business considerations described in the company’s SEC filings, including the annual report on Form 10-K, could impact Orbital’s actual financial and operational results. Orbital assumes no obligation for updating the information contained in this press release.

— attachments below —

Orbital Reports First Quarter 2005 Financial Results
Page 7

ORBITAL SCIENCES CORPORATION
Condensed Consolidated Income Statements
(unaudited, in thousands, except per share data)

	First Quarter
	2005			2004
Revenues	$	167,149		$	151,372
Costs of goods sold		139,338			126,454
Gross profit		27,811			24,918
Research and development expenses		1,032			1,742
Selling, general and administrative expenses		14,562			11,509
Settlement expense (income)		—			(2,538	)
Income from operations		12,217			14,205
Other income, net		757			426
Interest expense		(2,780	)		(2,909	)
Income before income taxes		10,194			11,722
Income taxes		(4,042	)		(228	)
Net income	$	6,152		$	11,494
Basic net income per share	$	0.11		$	0.24
Diluted net income per share	$	0.10		$	0.18
Shares used in computing basic net income per share		55,157			48,048
Shares used in computing diluted net income per share		63,461			65,370

Orbital Reports First Quarter 2005 Financial Results
Page 8

ORBITAL SCIENCES CORPORATION
Condensed Consolidated Balance Sheets
(in thousands)

	March 31,		Dec. 31,
	2005		2004
Assets
Cash	$	130,960	$	125,504
Receivables, net		155,317		149,480
Inventory		12,931		13,565
Deferred income taxes, net		26,791		26,710
Other current assets		11,891		12,195
Total current assets		337,890		327,454
Property, plant and equipment, net		83,341		83,154
Goodwill		55,551		55,551
Deferred income taxes, net		181,961		185,940
Other non-current assets		9,660		11,671
Total Assets	$	668,403	$	663,770
Liabilities and Stockholders’ Equity
Short-term borrowings	$	102	$	161
Accounts payable and accrued expenses		126,361		121,454
Deferred revenues		14,787		19,478
Total current liabilities		141,250		141,093
Long-term debt		126,026		128,375
Other non-current liabilities		625		178
Total stockholders’ equity		400,502		394,124
Total Liabilities and Stockholders’ Equity	$	668,403	$	663,770

Orbital Reports First Quarter 2005 Financial Results
Page 9

ORBITAL SCIENCES CORPORATION
Condensed Consolidated Statements of Cash Flows
(unaudited, in thousands)

	First Quarter
	2005			2004
Net income	$	6,152		$	11,494
Depreciation and amortization		3,636			3,652
Deferred taxes		3,896			—
Amortization of debt costs		153			234
Changes in assets and liabilities		(4,090	)		29,460
Other		(204	)		(678	)
Net cash provided by operating activities		9,543			44,162
Capital expenditures		(4,467	)		(2,628	)
Change in cash restricted for letters of credit, net		30			1,567
Net cash used in investing activities		(4,437	)		(1,061	)
Repayment of debt and other		(77	)		(69	)
Net proceeds from issuance of common stock		427			2,241
Net cash provided by financing activities		350			2,172
Net increase in cash		5,456			45,273
Cash, beginning of period		125,504			60,900
Cash, end of period	$	130,960		$	106,173