CACI International Inc CACI reported net earnings of $29.0 million or $1.18 per share in the third quarter of fiscal 2015 versus $30.8 million or $1.19 per share in the prior-year quarter. The year-over-year decline in earnings was due to lower revenues.
On an adjusted basis, third-quarter fiscal 2015 earnings were $1.69 per share, down from $1.78 in the year-earlier quarter. Recurring earnings (with stock-based compensation adjustments) of $1.20 per share missed the Zacks Consensus Estimate of $1.27.
Quarter Details
Quarterly revenues were down 9.2% year over year to $817.8 million. The reported revenues missed the Zacks Consensus Estimate of $854 million.
Contract awards were $687 million in the reported quarter, compared with $700 million of contract awards in the prior-year quarter. Contract funding orders aggregated $965 million compared with $794 million in the year-ago quarter. Total backlog as of Mar 31, 2015 was $9.7 billion with a funded backlog of $2.1 billion.
In terms of customer mix, the Department of Defense accounted for about 65.8% of the total revenue. Federal Civilian Agencies contributed about 28.1%, while Commercial and other customers accounted for 6.1% of revenues.
Operating income stood at $53.7 million in the reported quarter versus $60.5 million in the year-ago quarter. The decrease in operating income was driven by budget-related activities offset by lower indirect costs and selling expenses. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) stood at $70.0 million versus $78.7 million in the year-ago quarter.
Balance Sheet and Cash Flow
The company ended the quarter with cash and cash equivalents of $33.5 million. Long-term debt (net of current portion) totaled $1,036.1 million as of Mar 31, 2015.
Net cash from operations for the nine months ended Mar 31, 2015 was $190.4 million compared with $146.3 million in the year-ago period.
Others
After the end of the quarter, CACI International acquired LTC Engineering Associates, Inc. – a highly specialized provider of technical engineering solutions and services – for an undisclosed amount. The acquisition will likely expand CACI International’s capabilities in the command, control, communications, computers, intelligence, surveillance, and reconnaissance (C4ISR) and cyber markets.
Outlook
Fiscal 2015 revenues are expected now in the range of $3,300 million – $3,350 million, narrower from the prior range of $3,300 million – $3.600 million. Net income is expected in the range of $125 million to $130 million from the prior range of $125 million – $135 million. Earnings per share are expected in the range of $5.12 – $5.33 from the prior range of $5.14 – $5.56.
Moving ahead, CACI International expects to focus diligently on operating plans to reward shareholders with attractive risk-adjusted returns. The company remains confident on its competitive position and ability to continue meeting customer requirements through the delivery of innovative, affordable solutions and services.
CACI International currently has a Zacks Rank #3 (Hold). Stocks that look promising in the sector and are worth a look now include ARI Network Services Inc. ARIS, Ebix Inc EBIX and Perficient Inc. PRFT, each carrying a Zacks Rank #1 ( Strong Buy).
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