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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

X         Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2003

or

            Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 001-31342

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     x Yes       o No

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    o Yes     x No

     As of the close of business on May 5, 2003, there were 34,294,970 outstanding shares of the registrant’s common stock, par value $.0001 per share.

TABLE OF CONTENTS

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Part I – Financial Information

Item 1. Financial Statements

VERIDIAN CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
(Dollars in thousands, except share data)
(Unaudited)

     See accompanying notes to the unaudited condensed consolidated financial statements.

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VERIDIAN CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in thousands, except share data)

See accompanying notes to unaudited condensed consolidated financial statements.

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VERIDIAN CORPORATION AND SUBSIDIARIES
Consolidated Statements of Stockholders’ Equity
(Dollars in thousands, except share data)
(Unaudited)

     See accompanying notes to unaudited condensed consolidated financial statements.

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VERIDIAN CORPORATION AND SUBSIDIARIES
(Dollars in thousands)
(Unaudited)

     See accompanying notes to unaudited condensed consolidated financial statements.

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VERIDIAN CORPORATION AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Dollars in Thousands, except share data)
(Unaudited)

Note 1 Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements of Veridian Corporation (the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by accounting principles generally accepted in the United States. These interim financial statements should be read in conjunction with our consolidated financial statements and notes thereto as of December 31, 2002 and 2001, and for each of the years in the three-year period ended December 31, 2002, as included in the Company’s annual report on Form 10-K for the year ended December 31, 2002 filed with the SEC pursuant to Section 13 under the Securities Act of 1934. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and reflect all adjustments, consisting of normal, recurring adjustments, which are, in the opinion of management, necessary to present fairly the Company’s financial position as of March 31, 2003, the results of its operations and cash flows for the three months ended March 31, 2003 and 2002, and its changes in stockholders’ equity for the three months ended March 31, 2003. The results of operations for the three months ended March 31, 2003 are not necessarily indicative of the results that may be expected for the year ending December 31, 2003.

Note 2 Stock-Based Compensation

The Company applies the intrinsic value-based method of accounting prescribed by Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations including FASB Interpretation No. 44, “Accounting for Certain Transactions involving Stock Compensation an interpretation of APB Opinion No. 25”, to account for its fixed plan stock options. Under this method, compensation expense is recorded on the date of grant only if the current market price of the underlying stock on the date of grant exceeds the exercise price. Statement of Financial Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation (SFAS No. 123), established accounting and disclosure requirements using a fair value-based method of accounting for stock-based employee compensation plans. As allowed by SFAS No. 123, the Company has elected to continue to apply the intrinsic value-based method of accounting described above and adopted the disclosure requirements of SFAS No. 123.

The Company has also adopted the disclosure requirements of SFAS No. 148, Accounting for Stock-Based Compensation—Transition and Disclosure (SFAS No. 148), issued in December 2002. SFAS No. 148 provides alternate methods of transition for a voluntary change to the fair value method of accounting for stock-based compensation, and requires enhanced disclosure about the method used and the effect of the method used on reported results. Under SFAS No. 148, stock-based compensation disclosures must be included with the summary of significant accounting policies, and made both quarterly and annually.

The table below illustrates the effect on the net income attributable to common stockholders if the fair value-based method had been applied to employee stock benefits.

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All equity-based awards to non-employees are accounted for at a fair value in accordance with SFAS No. 123.

Note 3 Earnings Per Share

Basic earnings per share (EPS) is computed by dividing net income attributable to common stockholders by the weighted average number of outstanding shares of common stock. Diluted earnings per share for the three months ended March 31, 2003 and 2002 is based on the net income and weighted average number of outstanding shares of common stock as adjusted for the dilutive effect of stock options and warrants under the treasury stock method. Diluted earnings per share for the three months ended March 31, 2002 also includes the dilutive effect of Class A common stock. The weighted average number of shares outstanding are as follows:

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Note 4 Long-Term Debt

Long-term debt consists of the following:

Note 5 Sale of Discontinued Operations

During the three months ended March 31, 2002, the Company recognized a pre-tax loss of $1.8 million related to the sale of substantially all of the net assets and operations of its wholly-owned subsidiary, Veritect, Inc. (Veritect). The Company also recognized losses in 2001 and in December 2002 related to the discontinuance of Veritect’s operations. The sale of the net assets and operations of Veritect was effective June 18, 2002.

Note 6 New Accounting Pronouncements

The Company has adopted the disclosure provisions of SFAS No. 148, issued by the FASB in December 2002, and provided the requisite disclosures in note 2.

In April 2002, the FASB issued SFAS No. 145, Recission of FASB Statements 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections (SFAS 145), which will affect the Company’s financial statements for the three months ended June 30, 2003. SFAS No. 145 eliminates the requirement to report material gains or losses from debt extinguishments as an extraordinary item, net of any applicable income tax effect, in an entity’s statement of operations. SFAS No. 145 instead requires that a gain or loss recognized from a debt extinguishment be classified as an extraordinary item only when the extinguishment meets the criteria of both “unusual in nature” and “infrequent in occurrence” as prescribed under Accounting Principles Bulletin No. 30. The Company recognized extraordinary losses from debt extinguishments in 2002, and, for the three months ended June 30, 2003, will reclassify its extraordinary losses on debt extinguishments to operating expenses, and the tax benefits associated with the debt extinguishments to income tax expense.

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Note 7 Inventories

Inventory balances consist of the following:

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of our financial condition and results of operations should be read together with the unaudited condensed consolidated financial statements and the notes to those statements included elsewhere in this quarterly report. This discussion should also be read in conjunction with our consolidated financial statements and notes thereto as of December 31, 2002 and 2001, and for each of the years in the three-year period ended December 31, 2002, as included in the Company’s annual report on Form 10-K for the year ended December 31, 2002 filed with the SEC pursuant to Section 13 under the Securities Exchange Act of 1934.

Forward Looking Statements

Certain statements in this quarterly report contain or are based on “forward-looking” information (that Veridian believes to be within the definition in the Private Securities Litigation Reform Act of 1995) and involve risks and uncertainties, many of which are outside of our control. Words such as “may,” “will,” “intends,” “should,” “expects,” “plan,” “projects,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue,” or “opportunity,” or the negative of these terms or words of similar import, are intended to identify forward-looking statements.

These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated, including, without limitation: adverse changes in U.S. government spending priorities; failure to retain existing U.S. government contracts or win new contracts; failure to obtain option awards, task orders or funding under contracts; risks of contract performance; risk of contract terminations, either for default or for convenience of the U.S. government; adverse results of U.S. government audits of our U.S. government contracts; and risks associated with complex U.S. government procurement laws and regulations. These and other risk factors are more fully discussed in the section entitled “Risk Factors” in Veridian’s Annual Report on Form 10-K for the year ended December 31, 2002 filed with the Securities and Exchange Commission on March 13, 2003, and from time to time in Veridian’s other filings with the Securities and Exchange Commission, including among others, its reports on Form 8-K and Form 10-Q.

The forward-looking statements included in this quarterly report are only made as of the date of this quarterly report and we undertake no obligation to publicly update any of the forward-looking statements made herein, whether as a result of new information, subsequent events or circumstances, changes in expectations or otherwise.

Overview

We are a leading provider of information-based systems, integrated solutions and services to the U.S. government. We derived approximately 95% of our revenues during the first three months of 2003 from contracts with U.S. government agencies. Our two largest customer groups as of March 31, 2003 were the Department of Defense (50%) and the U.S. government intelligence community (27%). We also provide services to U.S. government civilian agencies, state and local governments, and commercial customers.

Critical Accounting Policies

Revenue and Related Cost Recognition

We recognize revenues under our U.S. government contracts when a contract has been executed, the contract price is fixed and determinable, delivery of the services or products has occurred, and collectibility of the contract price is considered probable. Our contracts with agencies of the U.S. government are subject to periodic funding by the respective contracting agency. Funding for a contract may be provided in full at inception of the contract or ratably throughout the term of the contract as the services are provided. In evaluating the probability of funding for purposes of assessing collectibility of the contract price, we consider our previous experiences with the customer, communications with the customer regarding funding status, and our knowledge of available funding for the contract or program. If funding is not assessed as probable, revenue recognition is deferred until realization is probable.

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We recognize revenue under our U.S. government contracts based on allowable contract costs, as mandated by the U.S. government’s cost accounting standards. The costs we incur under federal government contracts are subject to regulation and audit by certain agencies of the U.S. government. We provide an allowance for estimated contract disallowances based on the amount of probable cost disallowances. Such amounts have not historically been significant. We may be exposed to variations in profitability, including potential losses, if we encounter variances from estimated fees earned under award fee contracts and estimated costs under fixed price contracts.

Our revenues consist primarily of payments for the work of our employees, and to a lesser extent, the pass-through of costs for materials, contract-related travel and subcontract efforts under contracts with our customers. We enter into three types of U.S. government contracts: cost-plus, time-and-materials (including fixed-price, level-of-effort contracts where we are paid fixed hourly rates to deliver certain labor hours) and fixed-price. For cost-plus contracts, we are reimbursed for all of our allowable costs of performing the work plus a fee. For time-and-materials contracts, we are paid for labor at pre-negotiated hourly billing rates and reimbursed the actual cost of certain other expenses. We assume financial risk for time-and-materials contracts because we assume the risk of performing those contracts at negotiated hourly rates. For fixed-price contracts, we perform specific tasks for a fixed price. Compared to cost-plus contracts, fixed-price contracts generally offer higher margin opportunities since we receive the benefit of cost savings, but involve greater financial risk because we bear the impact of cost overruns.

We recognize revenue under our cost-plus contracts based on reimbursable costs incurred plus estimated fees earned on these contracts. Fees include an estimate of incentive and award fees earned, even though they may be determined and awarded at a later date. When we are able to make a reasonably dependable estimate of the amount of the award fee we will ultimately receive, we include such estimate in our revenue in the period of performance. In making this assessment, we consider such factors as our award fee history for similar work and for this particular customer, industry trends, interim performance reviews with the customer and all other available information. We perform this review on a contract-by-contract basis at the end of each reporting period. Adjustments to the expected award fee rate are recorded in the period in which we change our estimate. Such adjustments have historically been insignificant.

We recognize revenue under our time-and-materials contracts based on fixed billable rates for hours delivered plus reimbursable costs. We recognize revenue under our fixed-price contracts using the percentage-of-completion method based on the ratio of costs incurred to estimated total costs upon completion. We recognize revenues under some of our long-term, fixed-price contracts that require product deliveries on a percentage-of-completion basis using the units of delivery as the measurement basis for effort accomplished. Anticipated losses on contracts are charged to earnings as soon as these losses are known. Revenue recognized under fixed-price contracts in each reporting period may be different, if different assumptions are used regarding estimated total costs upon completion of the contracts. Changes in estimated profits on contracts are recorded during the period in which the change in estimate occurs.

Our direct costs include the cost of direct labor for the performance of contract services, the fringe benefits associated with that direct labor, and other direct costs related to contract performance, including the cost of materials and equipment, travel and subcontract costs. Some of these other direct costs are an integral part of our contract services for which we may be able to earn a fee. Other components of direct costs may be reimbursed by our customers with only a minor handling charge added. The amount of these other direct costs can vary substantially from period to period and may reduce overall operating margins when they are not fee-bearing.

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Indirect costs, selling, general and administrative expenses are the costs of delivering our contract services other than the direct costs described above and depreciation and amortization. Significant elements include labor for management and administrative activities, fringe benefits on indirect labor, facility costs and incentive compensation. They also include business development, marketing, selling, bid and proposal, and independent research and development costs. Most of these costs are allowable costs under the cost accounting rules for contracting with the U.S. government. As such, they may be directly reimbursed to us in cost-plus contracts or they may be included in cost estimates used for bidding time-and-materials and fixed-price contracts.

Indirect costs, as a percentage of revenues, may be influenced by a number of factors including: the level of other direct costs, our ability to manage personnel levels to meet constantly shifting contract demands, and shifts in the mix of labor required for our contracts. For example, an increase in labor services that are performed at our customers’ facilities may increase the relative proportion of direct costs, because we do not have to incur indirect costs related to the facilities used by those employees.

The majority of our revenues are earned under contracts with various departments and agencies, or prime contractors, of the U.S. government. Certain revenues and payments we receive are based on provisional billings and payments that are subject to adjustment under audit. U.S. government agencies and departments have the right to challenge our cost estimates and allocation methodologies with respect to U.S. government contracts. Also, contracts with such agencies are also subject to audit and possible adjustment to give effect to unallowable costs under cost-type contracts or to other regulatory requirements affecting both cost-type and fixed-price contracts.

Results of Operations

The following table sets forth our unaudited condensed consolidated results of operations based on the amounts and percentage relationship of the items listed to contract revenues during the periods presented (dollars in thousands):

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First Quarter of 2003 Compared to First Quarter of 2002:

Revenues. Revenues increased by $105.3 million, or 60%, from revenues of $176.6 million in the first quarter of 2002 to revenues of $281.9 million in the first quarter of 2003. Pro forma revenues in the first quarter of 2002, which include the revenues of Signal Corporation (“Signal”) for that period, which we acquired in September 2002, were $237.1 million. Revenues in the first quarter of 2003 were 19% higher than the pro forma revenues for the same period in 2002. The 19% organic growth was across a broad range of our businesses and contracts, reflecting the continued growth in demand for services from our customers in the Department of Defense, the intelligence community, and federal civil agencies. New contracts wins in 2002, such as the contracts for network operations for the U.S. Senate and for support to the U.S. Navy’s Weapons Test Center in China Lake, California, and significant growth in C4ISR systems integration work for the U.S. Army, were major contributors to the growth. Other contributors were growth in certain classified programs and early stage work on some homeland security projects, which began in late 2002. Revenues by major customer group were as follows: Department of Defense 50%, intelligence community 27%, federal civil agencies 18% and others 5%. The customer mix did not change significantly from the mix in 2002 after the acquisition of Signal.

Costs and Expenses. Costs of operations increased by $96.3 million in the first quarter of 2003 to $260.8 million, keeping pace with the increased business activity. Direct contract costs grew to 70.9% of revenues in the most recent quarter, compared to 65.4% of revenues in the first quarter of last year. The large increase in the percentage of direct costs is primarily due to the inclusion of the business of Signal Corporation. That business is characterized by a higher level of direct costs for subcontractors and equipment purchases, and by a greater proportion of labor services that are performed on customer sites which holds down the indirect operating costs such as facilities expenses. The percentage of direct costs in the first quarter of 2003 is very similar to the direct cost percentage (70.7%) in the fourth quarter of 2002, the first full quarter which included the operating results of Signal in our consolidated operating results. The 19% organic growth in revenues in the recent quarter was driven by a 14% growth in direct labor and more rapid growth in revenues based on other direct costs.

Indirect costs, selling, general and administrative expenses declined to 20.2% of revenues in the first quarter of 2003, compared to 26.3% of revenues in the first quarter of 2002. Again, the change in the percentage is primarily the result of the different cost profile of Signal. Of the decline in the percentage of indirect costs of 6.1%, approximately 4.7% was due to the acquisition of Signal. The remaining reduction of approximately 1.4% is the result of controlling the growth in indirect expenses, primarily by improving labor productivity. These labor productivity gains were the primary reason for the increase in operating margins, from 6.9% of revenues in the first quarter of 2002 to 7.5% of revenues in the most recent quarter. The results in the recent quarter were similar to the 20.4% of indirect operating expenses experienced in the fourth quarter of 2002, the first full quarter after the acquisition of Signal.

Depreciation expense was $2.9 million, or 1.0% of revenues, in the first quarter of 2003, as compared to $2.6 million, or 1.4% of revenues, in the first quarter of 2002. The lower rate of depreciation expense in the most recent quarter reflects the inclusion of the operations of Signal, which require less property and equipment since a higher proportion of employees work on customer sites.

Amortization expense of $1.1 million in the first quarter of 2003 relates to identifiable intangible assets of Signal, which was acquired in September 2002.

Income from Operations. Income from operations increased by 75%, from $12.1 million in the first quarter of 2002 to $21.2 million in the first quarter of 2003. As a percent of revenues, income from operations increased to 7.5% in the recent quarter, compared to 6.9% a year ago. The margin improvement is the result of improvement in profitability related to increases in labor productivity and the higher operating margins of the Signal business reflected in the most recent quarter operating results, partially offset by the amortization of intangible assets at 0.4% of revenues.

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Interest Expense. Interest expense declined to $4.3 million in the first quarter of 2003, from $6.2 million in the first quarter of 2002, despite an increase in the level of debt related to the acquisition of Signal. Interest expense was reduced substantially following the redemption of $95 million of 14.5% subordinated debt from the proceeds of our initial public offering in June 2002. Further, interest rates on our variable rate debt, based on LIBOR, have been declining over the past year. These interest rate reductions have more than offset the impact on interest expense of the increased debt levels. At the end of the first quarter of 2003, the average interest rate, including amortization of deferred financing costs and fees, on our variable rate debt, which totaled $266.4 million, was 5.4%. The interest rate on our $25 million of subordinated debt is presently 9.5%.

Income Taxes

The income tax provision rates for the first quarters of 2003 and 2002 were 40.3% and 42.3% respectively. These rates exceed the 35% federal income tax rate primarily as a result of state income taxes. The lower rate in the most recent quarter is due to the significantly higher level of pretax income, which dilutes the effect of certain permanent tax differences.

Income from Continuing Operations

Net earnings from continuing operations increased to $10.2 million in the first quarter of 2003, from $3.6 million in the first quarter of 2002. The increase reflects the increased revenues, higher operating margins and the interest savings discussed above.

Discontinued Operations

In the first quarter of 2002, we recorded a loss related to the disposal of discontinued operations of our commercial subsidiary, Veritect, Inc. Later, in the fourth quarter of 2002, we recorded an additional loss of $2.3 million, net of income tax benefit. The sale of Veritect’s operations was completed in 2002, and we anticipate no further effect on operating results in 2003.

Liquidity and Capital Resources

Our primary source of cash flow to meet our debt service requirements is our income from operations. In the first quarter of 2003, we used $1.3 million of cash in operations, compared to the $16.4 million of cash generated from operations in the first quarter of 2002. The decrease in operating cash flow resulted primarily from an increase in accounts receivable of $18.4 million and the payment of annual incentive compensation. Approximately $7.8 million of the increase in accounts receivable related to the growth in revenues from the fourth quarter of 2002 to the first quarter of 2003. The remainder of the increase, $10.6 million, is the result of an increase in our days sales outstanding (DSO) in accounts receivable from 79 days at December 31, 2002 to 83 days at March 31, 2003. We believe the increase in the DSO in the current quarter primarily reflects normal period-to-period variability in our customers’ payment practices.

Cash used in investing activities in the first quarter of 2002 included $3.4 million to fund discontinued operations of Veritect, compared to $0 in the first quarter of 2003. Cash used for purchases of property, plant and equipment was $2.6 million in the first quarter of 2003, up from the $2.4 million in the first quarter of 2002. As of March 31, 2003, there were no individually large outstanding commitments for capital expenditures.

Cash used in financing activities decreased from $10.7 million in the first quarter of 2002 to $0.2 million in the first quarter of 2003 primarily as a result of a $9.4 million decrease in the net repayments of long term debt made in the first quarter of 2003 versus the comparable period a year ago.

At March 31, 2003, we had $86.5 million of funds available under our senior credit facility. We believe that our operating cash flow and borrowing capacity are sufficient to meet our operating needs and debt service requirements for at least the next 12 months. To the extent that the financial requirements of any business acquisition opportunity exceeds the limit set forth under our senior credit facility, we will need to raise additional debt or equity financing.

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Impact of Inflation

The nature of our contracts with the U.S. government sharply reduces our exposure to the potential negative financial effects of inflation. We are able to directly recover increased costs for those costs charged directly to, or allocated to, our cost-plus contracts, which account for approximately 47% of our business. On our other contracts, we propose fixed prices or labor rates that reflect our expectations of future cost increases.

New Accounting Pronouncements

We have adopted the provisions of Statement of Financial Accounting Standards No. 148, Accounting for Stock-Based Compensation—Transition and Disclosure (SFAS No. 148), issued in December 2002, and included the required quarterly disclosures for stock options in note 2 to our condensed consolidated financial statements. Also, we adopted the provisions of SFAS No. 145, Recission of FASB Statements 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections (SFAS 145), issued in April 2002. SFAS No. 145 eliminates the requirement to report material gains or losses from debt extinguishments as an extraordinary item, net of any applicable income tax effect, in our statement of operations. We will reflect the reclassification of the extraordinary loss we recognized in June 2002 in our financial statements for the three months ended June 30, 2003.

The provisions of SFAS Nos 148 and 145 are more fully discussed in notes 2 and 6 of our condensed consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our principal exposure to market risk relates to changes in interest rates. At March 31, 2003, we had outstanding under our senior credit facility two LIBOR-based loans, with outstanding balances of $165 and $100 million. We also had prime rate-based loans totaling $1.4 million. Together the loans had an effective interest rate of 5.4%. Each 1% increase in this rate could add $2.7 million to our annual interest expense.

Item 4. Controls and Procedures.

(a) Evaluation of disclosure controls and procedures

The term disclosure controls and procedures is defined in Rules 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934. These rules refer to the controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Furthermore, we have designed our disclosure controls and procedures to ensure that information that we are required to disclose in our report is accumulated and communicated to management (including our Chief Executive Officer and Chief Financial Officer) in a manner that permits timely decisions to be made regarding required disclosure.

Our Chief Executive Officer and our Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures as of a date within 90 days prior to the date of the filing of this quarterly report, and they have concluded that such disclosure controls and procedures were effective at ensuring that they were alerted in a timely manner as to all material information that we are required to include in our reports with the Securities and Exchange Commission.

(b) Changes in internal controls

We maintain a system of internal accounting controls that are designed to provide reasonable assurance that our books and records accurately reflect our transactions and that our established policies and procedures are followed. For the quarter ended March 31, 2003, there were no significant changes to our internal controls or in other factors that could significantly affect our internal controls subsequent to the date of their evaluation.

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Part II — Other Information

Item 2. Changes in Securities and Use of Proceeds.

(c)

During the first quarter of 2003, certain current and former employees purchased 79,831 shares of our common stock by exercising outstanding stock options for an aggregate sales price of $347,811. These transactions occurred in reliance upon the exemptions from the registration requirements of the Securities Act of 1933, as amended, afforded by Rule 701, pursuant to certain compensatory benefit plans and contracts, as a transaction involving the offer and sale of securities relating to compensation. We believe that exemptions other than the foregoing may exist for these transactions.

Item 6. Exhibits and Reports on Form 8-K.

(b)

During the three months ended March 31, 2003, the Company filed the following Form 8-K:

(1)

Current Report on Form 8-K, dated and filed on February 19, 2003, to report that the Company announced its earnings for the three-month period ended December 31, 2002 and the fiscal year ended December 31, 2002.

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SIGNATURES

     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 thereunto duly authorized.

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CERTIFICATION

I, David H. Langstaff, certify that:

1.		I have reviewed this quarterly report on Form 10-Q of Veridian Corporation;
2.		Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.		Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.		The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

	(a)		Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
	(b)		Evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and
	(c)		Presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

	(a)		All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
	(b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6.

The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

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CERTIFICATION

I, James P. Allen, certify that:

1.		I have reviewed this quarterly report on Form 10-Q of Veridian Corporation;
2.		Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.		Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.		The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

	(a)		Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
	(b)		Evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and
	(c)		Presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

	(a)		All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
	(b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6.

The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

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