CACI International Inc (CACI) reported adjusted earnings of $43.6 million or $1.81 per share in the first quarter of fiscal 2015 versus $44.7 million or $1.80 per share in the prior-year quarter. The recurring earnings (with stock-based compensation adjustments) of $1.74 per share comfortably beat the Zacks Consensus Estimate of $1.21.
On a GAAP basis, first-quarter fiscal 2015 earnings were $31.1 million or $1.29 per share, down from $33.0 million or $1.33 a share in the year-earlier quarter. The year-over-year decline in GAAP earnings was primarily attributable to a reduction in revenue and a dilutive effect of paying off convertible notes.
Quarter Details
Quarterly revenues were down 5.7% year over year to $814.7 million due to reduction of material purchases and subcontract labor, partially offset by increased direct labor. Revenues for first-quarter fiscal 2015 missed the Zacks Consensus Estimate of $855 million.
Contract awards for the reported quarter improved 32.8% year over year to $2.43 billion. Contract funding orders aggregated $1.35 billion in the quarter versus $1.31 billion in the year-ago period. This brought the total backlog tally to $8.7 billion as of Sep 30, 2014 with a funded backlog of $2.1 billion.
In terms of customer mix, the Department of Defense accounted for about 68.0% of total revenues in the reported quarter. Federal Civilian Agencies contributed about 25.6%, while Commercial and other customers accounted for 6.4% of total revenues.
Operating income stood at $60.1 million in the reported quarter versus $61.2 million in the year-ago quarter. The year-over-year decrease in operating income was due to higher indirect costs and selling expenses and higher depreciation and amortization, partially offset by increased gross profit. Adjusted Earnings before interest, taxes, depreciation and amortization (EBITDA) stood at $77.2 million versus $74.2 million in the year-ago quarter.
Balance Sheet and Cash Flow
The company ended the quarter with cash and cash equivalents of $100.0 million versus $64.5 million as of Jun 30, 2014. Long-term debt (net of current portion) totaled $1,168.6 million at Sep 30, 2014, compared with $1,238.7 million at Jun 30, 2014.
Net cash provided by operations for three months ended Sep 30, 2014 was $111.7 million compared with $27.3 million in the year-ago period.
Outlook
For fiscal 2015, CACI International reiterated its previous guidance. Fiscal 2015 revenues are expected within $3.3 billion and $3.6 billion. Net income is expected in the range of $125 million to $135 million. Earnings per share are expected within $5.10 and $5.51.
Moving ahead, CACI International expects to diligently focus on its operating plans to reward its shareholders with attractive risk-adjusted returns. The company also remains on track to fully integrate Six3 Systems with its operations to achieve at least 5% accretion to GAAP earnings per share and 10% on an adjusted earnings per share basis.
CACI International also intends to drive operational excellence by intensively focusing on its organic and inorganic growth strategies and strengthening its existing customer relationships while building newer ones.
CACI International currently has a Zacks Rank # 1 (Strong Buy). Other stocks that look promising and are worth a look include LogMeIn, Inc. (LOGM), carrying a Zacks Rank #1 (Strong Buy) along with CSG Systems International Inc (CSGS) and Innodata Inc. (INOD), both carrying a Zacks Rank #2 (Buy).
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