Maximus (MMS) 8-K MAXIMUS Reports Record Results for Fiscal 2011 Fourth Quarter and Full Year

Exhibit 99.1

MAXIMUS Reports Record Results for Fiscal 2011 Fourth Quarter and Full Year

- Introduces Outlook for Fiscal 2012; Board Increases Share Buyback Authorization to $125 Million -

RESTON, Va.--(BUSINESS WIRE)--November 10, 2011--MAXIMUS (NYSE: MMS), a leading provider of government services worldwide, today reported financial results for its fourth quarter and fiscal year ended September 30, 2011.

Key highlights include:

·   Revenue grew 18% to $250.1 million for the fourth quarter and 12% to $929.6 million for the full fiscal year compared to the same periods last year, driven by growth on current contracts and new work.

·   Adjusted diluted earnings per share from continuing operations increased 19% to $0.64 for the fourth quarter and 24% to $2.25 for the full fiscal year compared to the same periods last year.

·   Cash and cash equivalents totaled $173.0 million at September 30, 2011.

·   The Company purchased approximately 1.1 million shares of MAXIMUS common stock for $39.6 million during the fourth quarter and on November 8, 2011, the Board of Directors increased the Company’s share repurchase program to $125 million.

·   The Company achieved record signed awards in fiscal 2011 that totaled $1.6 billion.

Revenue for the fiscal 2011 fourth quarter increased 18% (14% on a constant currency basis) to $250.1 million versus $212.5 million reported for the same period last year. Revenue for fiscal year 2011 increased 12% (8% on a constant currency basis) to $929.6 million compared to fiscal year 2010. Revenue increases were driven by organic growth on existing contracts and new work in both Segments and across all geographies.

During the fourth quarter, an increased share of international business and other factors reduced the tax rate to 28.9% for the quarter and 34.8% for the fiscal year. As a result, fourth quarter GAAP income from continuing operations, net of taxes, increased 24% to $25.6 million, or $0.73 per diluted share, and includes approximately $0.09 of the aforementioned benefits and a net legal recovery. Normalized for these benefits, fourth quarter adjusted diluted earnings per share from continuing operations increased 19% to $0.64 compared to the same period last year. For the full year, GAAP income from continuing operations, net of taxes, increased 18% to $82.1 million, or $2.31 per diluted share, which includes approximately $0.06 of benefits. Excluding these benefits, adjusted diluted earnings per share from continuing operations increased 24% to $2.25 compared to fiscal 2010. A normalization table is included in the accompanying financial schedules.

“MAXIMUS delivered another exceptional year with solid growth in both our Health and Human Services Segments. We won 98% of total contract value up for rebid, securing some of our most important projects for the next several years. Our recently launched operations in the United Kingdom are trending as expected and we recently received notification of award for new strategic work in Canada,” commented Richard A. Montoni, Chief Executive Officer of MAXIMUS.

Health Services Segment

Health Services Segment revenue for the fourth quarter of fiscal 2011 increased 21% to $156.3 million compared to $129.0 million for the same period last year, principally driven by the expansion of Medicaid managed care and efforts to modernize PharmaNet in British Columbia. For fiscal 2011, revenue increased 10% to $565.9 million compared to $514.3 million the prior year, driven by new work and expansion on existing contracts.

Health Services Segment operating income for the fourth quarter grew 3% to $20.6 million with an operating margin of 13.2% compared to $20.0 million in the same period last year. For the full fiscal year, Segment operating income increased 15% to $74.7 million with a 13.2% operating margin compared to $64.7 million in fiscal 2010.

Human Services Segment

Human Services Segment revenue for the fourth quarter increased 12% (4% on a constant currency basis) to $93.8 million compared to $83.5 million in the prior year period. For fiscal 2011, revenue increased 15% (or 7% on a constant currency basis) to $363.8 million compared to $317.5 million last year. Segment revenue growth was driven by the Company’s international welfare-to-work business in Australia and the United Kingdom.

Human Services Segment operating income for the fourth quarter totaled $13.3 million with an operating margin of 14.2% compared to $12.4 million in the same period last year. For the full fiscal year, operating income grew 19% to $46.8 million with a 12.9% operating margin compared to $39.5 million in fiscal 2010.

Backlog, Sales and Pipeline

The Company reported record backlog totaling $2.9 billion at September 30, 2011, which is a 38% increase over backlog of $2.1 billion at September 30, 2010. The increased backlog was attributable to new wins and the successful award of several large rebids in fiscal 2011.

Year-to-date signed contract wins at September 30, 2011 totaled $1.609 billion compared to $685 million for fiscal 2010. New contracts pending (awarded but unsigned) totaled $691 million compared to $709 million last year. Sales opportunities (pipeline) at November 4, 2011, totaled $1.8 billion (consisting of $417 million in proposals pending, $272 million in proposals in preparation and $1.1 billion in proposals tracking) compared to $1.8 billion in fiscal 2010.

Balance Sheet and Cash Flows

Cash and cash equivalents totaled $173.0 million at September 30, 2011. For the full fiscal year, cash provided by operating activities from continuing operations totaled $97.6 million with free cash flow of $71.5 million, and for the fourth quarter cash provided by operating activities from continuing operations totaled $27.1 million with free cash flow of $17.6 million. The Company defines free cash flow as cash provided by operating activities from continuing operations less cash paid for property, equipment and capitalized software.

Days Sales Outstanding (DSO) from continuing operations were favorable at 56 days and driven by the timing of collections.

On August 31, 2011, MAXIMUS paid a quarterly cash dividend of $0.09 per share, and on October 12, 2011, the Company announced a $0.09 per share cash dividend, payable on November 30, 2011 to shareholders of record on November 15, 2011.

During the fourth quarter of fiscal 2011, MAXIMUS used $39.6 million to purchase 1,083,700 shares of MAXIMUS common stock under its Board-authorized share repurchase program. For fiscal 2011, MAXIMUS repurchased a total of 1,597,458 shares and used cash of $56.5 million for buyback activity. At September 30, 2011, the Company had $77.8 million available for future repurchases. However, on November 8, 2011, the Board of Directors increased the share repurchase authorization to $125 million.

Outlook

MAXIMUS is introducing fiscal 2012 revenue guidance in the range of $980 million to $1.015 billion. At September 30, 2011, 95% of forecasted 2012 revenue was in the form of backlog or options periods. The Company expects fiscal 2012 adjusted diluted earnings from continuing operations in the range of $2.20 to $2.30, which reflects the expected start-up losses in fiscal 2012 on the new Work Programme in the United Kingdom. The Company is expecting an improved fiscal 2012 outlook for its UK operations and now expects revenue of approximately $30 million and losses of approximately $9.5 million. The improvement is a result of higher volumes on the Work Programme, as well as a potential termination payment associated with the legacy Flexible New Deal anticipated in the first quarter.

Mr. Montoni concluded, “We remain keenly focused on creating the foundation for growth over the next three years and beyond. The need for high quality, efficient social services is a universal one and we believe there will continue to be demand for world-class administration of government programs from vendors who can deliver results. With our fiscal 2012 guidance now in place, we look forward to driving results for our clients and delivering long-term value to our shareholders.”

Website Presentation, Conference Call and Webcast Information

MAXIMUS will host a conference call this morning, November 10, 2011, at 9:00 a.m. (ET). The call is open to the public and can be accessed under the Investor Relations page of the Company’s website at www.maximus.com or by calling:

877.407.8289 (Domestic)/201.689.8341 (International)

For those unable to listen to the live call, a replay will be available through November 18, 2011. Callers can access the replay by calling:

877.660.6853 (Domestic)/201.612.7415 (International)

Replay account number: 316

Replay conference ID number: 381745

About MAXIMUS

MAXIMUS is a leading health and human services administrator for governments in the United States, United Kingdom, Canada and Australia. The Company delivers administrative solutions to improve the cost effectiveness, efficiency and quality of government-sponsored benefit programs, such as Medicaid, Medicare, Children's Health Insurance Program (CHIP), Health Insurance BC (British Columbia), as well as welfare-to-work and child support enforcement programs across the globe. The Company's primary customer base includes federal, provincial, state, county and municipal governments. Operating under its founding mission of Helping Government Serve the People®, MAXIMUS has more than 7,000 employees located in more than 220 offices worldwide. For more information, visit www.maximus.com.

Statements that are not historical facts, including statements about the Company's confidence and strategies and the Company's expectations about revenues, results of operations, profitability, future contracts, market opportunities, market demand or acceptance of the Company's products are forward-looking statements that involve risks and uncertainties. These uncertainties could cause the Company's actual results to differ materially from those indicated by such forward-looking statements and include reliance on government clients; risks associated with government contracting; risks involved in managing government projects; legislative changes and political developments; opposition from government unions; challenges resulting from growth; adverse publicity; and legal, economic, and other risks detailed in Exhibit 99.1 to the Company's most recent Quarterly Report filed with the Securities and Exchange Commission, found on www.maximus.com.

MAXIMUS, Inc.
CONSOLIDATED BALANCE SHEETS
(In thousands)
	September 30,
	2011			2010
ASSETS	(Unaudited)
Current assets:
Cash and cash equivalents	$	172,950		$	155,321
Restricted cash		4,839			4,182
Accounts receivable—billed, net		146,900			136,260
Accounts receivable—unbilled		7,170			17,245
Prepaid income taxes		12,959			4,149
Deferred income taxes		19,256			13,290
Prepaid expenses and other current assets		27,202			25,702
Total current assets		391,276			356,149
Property and equipment, net		51,740			48,873
Capitalized software, net		26,616			24,715
Goodwill		71,323			71,251
Intangible assets, net		5,651			7,778
Deferred contract costs, net		8,020			6,708
Deferred income taxes		732			1,844
Deferred compensation plan assets		8,004			8,317
Other assets		1,917			2,106
Total assets	$	565,279		$	527,741
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	55,470		$	49,200
Accrued compensation and benefits		47,748			40,807
Deferred revenue		47,902			58,070
Current portion of long-term debt		42			—
Acquisition-related contingent consideration		1,840			923
Income taxes payable		5,104			7,120
Accrued liabilities		5,787			7,934
Liabilities of discontinued operations		—			634
Total current liabilities		163,893			164,688
Deferred revenue, less current portion		2,575			4,083
Long-term debt		1,654			1,411
Acquisition-related contingent consideration, less current portion		388			2,138
Income taxes payable, less current portion		1,484			1,793
Deferred income taxes		11,945			4,946
Deferred compensation plan liabilities, less current portion		8,883			9,893
Total liabilities		190,822			188,952
Shareholders’ equity:
Common stock, no par value; 60,000 shares authorized; 56,018 and 54,975 shares issued and 33,793 and 34,348 outstanding at September 30, 2011 and September 30, 2010, at stated amount, respectively		377,579			352,696
Treasury stock, at cost; 22,225 and 20,627 shares at September 30, 2011 and September 30, 2010, respectively		(416,850	)		(359,366	)
Accumulated other comprehensive income		12,480			14,530
Retained earnings		401,248			330,929
Total shareholders’ equity		374,457			338,789
Total liabilities and shareholders’ equity	$	565,279		$	527,741

MAXIMUS, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Unaudited
	Three Months						Year
	Ended September 30,						Ended September 30,
	2011			2010			2011			2010
Revenue	$	250,107		$	212,516		$	929,633		$	831,749
Cost of revenue		181,880			151,422			675,982			610,916
Gross profit		68,227			61,094			253,651			220,833
Selling, general and administrative expenses		34,560			30,904			132,058			118,778
Legal and settlement recovery, net		1,169			—			808			5,351
Operating income from continuing operations		34,836			30,190			122,401			107,406
Interest and other income, net		1,124			189			3,495			916
Income from continuing operations before income taxes		35,960			30,379			125,896			108,322
Provision for income taxes		10,403			9,698			43,754			38,925
Income from continuing operations		25,557			20,681			82,142			69,397
Discontinued operations, net of income taxes:
Income (loss) from discontinued operations		197			1,060			(133	)		1,040
Loss on disposal		(179	)		(28	)		(841	)		(28	)
Income (loss) from discontinued operations		18			1,032			(974	)		1,012
Net income	$	25,575		$	21,713		$	81,168		$	70,409
Basic earnings (loss) per share:
From continuing operations	$	0.75		$	0.60		$	2.39		$	1.99
From discontinued operations		—			0.03			(0.03	)		0.03
Basic earnings per share	$	0.75		$	0.63		$	2.36		$	2.02
Diluted earnings (loss) per share:
From continuing operations	$	0.73		$	0.58		$	2.31		$	1.93
From discontinued operations		—			0.03			(0.03	)		0.03
Diluted earnings per share	$	0.73		$	0.61		$	2.28		$	1.96
Dividends paid per share	$	0.09		$	0.06		$	0.30		$	0.24
Weighted average shares outstanding:
Basic		34,180			34,455			34,417			34,827
Diluted		35,258			35,614			35,531			35,930

MAXIMUS, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
	Quarter Ended September 30,						Year ended September 30,
	2011			2010			2011			2010
Cash flows from operating activities:
Net income	$	25,575		$	21,713		$	81,168		$	70,409
Adjustments to reconcile net income to net cash provided by operating activities:
Loss from discontinued operations		(18	)		(1,032	)		974			(1,012	)
Depreciation and amortization		6,366			4,692			22,845			18,340
Deferred income taxes		1,386			(1,891	)		1,758			(3,172	)
Deferred interest income on note receivable		—			—			—			263
Non-cash equity based compensation		2,549			1,935			9,485			7,918
Change in assets and liabilities:
Accounts receivable — billed		(22,471	)		(10,857	)		(11,584	)		38
Accounts receivable — unbilled		9,209			4,954			10,068			2,415
Prepaid expenses and other current assets		(4,462	)		264			(2,573	)		(1,740	)
Deferred contract costs		540			183			(1,309	)		1,541
Accounts payable		(148	)		(8,975	)		7,312			(407	)
Accrued compensation and benefits		4,996			1,122			4,490			7,883
Deferred revenue		2,196			8,745			(11,779	)		31,294
Income taxes		2,403			(3,145	)		(10,814	)		6,374
Other assets and liabilities		(1,021	)		2,914			(2,456	)		827
Cash provided by continuing operations		27,100			20,622			97,585			140,971
Cash used in discontinued operations		361			(378	)		(725	)		(2,530	)
Cash provided by operating activities		27,461			20,244			96,860			138,441
Cash flows from investing activities:
Proceeds from sale of discontinued operations, net of transaction costs		—			1,700			—			1,700
Acquisition of businesses, net of cash acquired		(1,021	)		(1,287	)		(1,021	)		(11,960	)
Purchases of property and equipment		(7,543	)		(3,553	)		(18,506	)		(13,936	)
Capitalized software costs		(1,915	)		(2,365	)		(7,608	)		(8,672	)
Proceeds from note receivable		172			—			237			473
Cash used in investing activities — continuing ops		(10,307	)		(5,505	)		(26,898	)		(32,395	)
Cash flows from financing activities:
Employee stock transactions		(70	)		84			8,980			2,763
Repurchases of common stock		(39,566	)		(17,699	)		(56,540	)		(40,217	)
Tax benefit due to option exercises and restricted stock units vesting		1,769			1,477			6,996			2,901
Repayment of long-term debt		—			—			—			(7	)
Issuance of long-term debt		—			199			304			533
Cash dividends paid		(3,086	)		(2,079	)		(10,327	)		(8,375	)
Cash used in financing activities — continuing ops		(40,953	)		(18,018	)		(50,587	)		(42,402	)
Effect of exchange rate changes on cash and cash equivalents		(7,267	)		5,541			(1,746	)		3,862
Net increase (decrease) in cash and cash equivalents		(31,066	)		2,262			17,629			67,506
Cash and cash equivalents, beginning of period		204,016			153,059			155,321			87,815
Cash and cash equivalents, end of period	$	172,950		$	155,321		$	172,950		$	155,321

MAXIMUS, Inc.
SEGMENT INFORMATION
(In thousands)
(Unaudited)
	Three Months Ended September 30,										Year Ended September 30,
	2011			% (1)		2010			% (1)		2011			% (1)		2010			% (1)
Revenue:
Health Services	$	156,303		100	%	$	129,032		100	%	$	565,881		100	%	$	514,258		100	%
Human Services		93,804		100	%		83,484		100	%		363,752		100	%		317,491		100	%
Total		250,107		100	%		212,516		100	%		929,633		100	%		831,749		100	%
Gross Profit:
Health Services		39,183		25.1	%		36,009		27.9	%		147,239		26.0	%		130,276		25.3	%
Human Services		29,044		31.0	%		25,085		30.0	%		106,412		29.3	%		90,557		28.5	%
Total		68,227		27.3	%		61,094		28.7	%		253,651		27.3	%		220,833		26.6	%
Selling, general, and administrative expense:
Health Services		18,566		11.9	%		16,024		12.4	%		72,524		12.8	%		65,551		12.7	%
Human Services		15,756		16.8	%		12,695		15.2	%		59,590		16.4	%		51,067		16.1	%
Corporate/Other		238		NM			2,185		NM			(56	)	NM			2,160		NM
Total		34,560		13.8	%		30,904		14.5	%		132,058		14.2	%		118,778		14.3	%
Operating income from continuing operations:
Health Services		20,617		13.2	%		19,985		15.5	%		74,715		13.2	%		64,725		12.6	%
Human Services		13,288		14.2	%		12,390		14.8	%		46,822		12.9	%		39,490		12.4	%
Consolidating adjustments		(238	)	NM			(2,185	)	NM			56		NM			(2,160	)	NM
Subtotal: Segment Operating Income		33,667		13.5	%		30,190		14.2	%		121,593		13.1	%		102,055		12.3	%
Legal and settlement recovery (expense), net		1,169		NM			—		NM			808		NM			5,351		NM
Total	$	34,836		13.9	%	$	30,190		14.2	%	$	122,401		13.2	%	$	107,406		12.9	%

_________________________
(1)	Percentage of respective segment revenue. Changes not considered meaningful are marked “NM.”

MAXIMUS, Inc.
Supplemental Pro Forma Diluted EPS from Continuing Operations
("Adjusted EPS")
FY 2010 and FY 2011
(Unaudited)
											Total
	Q1 10		Q2 10			Q3 10		Q4 10			FY 10
Diluted EPS from continuing operations - GAAP basis	$	0.40	$	0.50		$	0.45	$	0.58		$	1.93
Pro forma Adjustments:
Legal and settlement expense (recovery), net		0.01		(0.11	)		-		-			(0.10	)
Adjustment for taxation rate		0.02		(0.01	)		0.01		(0.04	)		(0.02	)
Subtotal pro forma adjustments		0.03		(0.12	)		0.01		(0.04	)		(0.12	)
Adjusted EPS from continuing operations	$	0.43	$	0.38		$	0.46	$	0.54		$	1.81
											Total
	Q1 10		Q2 11			Q3 11		Q4 11			FY 11
Diluted EPS from continuing operations	$	0.50	$	0.54		$	0.56	$	0.73		$	2.31
Pro forma Adjustments:
Legal and settlement expense (recovery), net		-		-			-		(0.02	)		(0.02	)
Adjustment for taxation rate		0.01		0.01			0.01		(0.07	)		(0.04	)
Subtotal pro forma adjustments		-		-			-		-			-
Adjusted EPS from continuing operations	$	0.51	$	0.55		$	0.57	$	0.64		$	2.25

CONTACT:

MAXIMUS, Inc.

Lisa Miles,800-MAXIMUS x11637