DLH (DLHC) 10-K 11 Dec 19 2019 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Sep. 30, 2019	Dec. 09, 2019	Mar. 31, 2019
Document and Entity Information
Entity Registrant Name	DLH Holdings Corp.
Entity Central Index Key	0000785557
Document Type	10-K
Document Period End Date	Sep. 30, 2019
Amendment Flag	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--09-30
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		12,103,993
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Public Float			$ 45,602,650

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Income Statement [Abstract]
Revenue	$ 160,391	$ 133,236
Contract costs	124,551	105,374
General and administrative costs	20,525	16,838
Acquisition costs	1,391	0
Depreciation and amortization	3,956	2,242
Total operating costs	150,423	124,454
Income from operations	9,968	8,782
Interest expense, net	2,473	1,116
Income before income taxes	7,495	7,666
Income tax expense	2,171	5,830
Net income	$ 5,324	$ 1,836
Earnings Per Share [Abstract]
Net income per share - basic (in dollars per share)	$ 0.44	$ 0.15
Net income per share - diluted (in dollars per share)	$ 0.41	$ 0.14
Weighted average common shares outstanding
Basic (in shares)	12,018	11,881
Diluted (in shares)	13,041	12,873

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Current assets:
Cash and cash equivalents	$ 1,790	$ 6,355
Accounts receivable	23,226	10,280
Other current assets	1,831	760
Total current assets	26,847	17,395
Equipment and improvements, net	5,343	1,566
Deferred taxes, net	2,345	4,137
Goodwill	52,758	25,989
Intangible assets, net	41,208	13,365
Other long-term assets	757	89
Total assets	129,258	62,541
Current liabilities:
Accrued payroll	8,852	4,983
Accounts payable, accrued expenses, and other current liabilities	20,633	10,950
Total current liabilities	29,485	15,933
Total long-term liabilities	54,202	7,190
Total liabilities	83,687	23,123
SHAREHOLDERS’ EQUITY
Common stock, $0.001 par value; authorized 40,000 shares; issued and outstanding 12,036 and 11,899 at September 30, 2019 and September 30, 2018, respectively	12	12
Additional paid-in capital	85,114	84,285
Accumulated deficit	(39,555)	(44,879)
Total shareholders’ equity	45,571	39,418
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 129,258	$ 62,541

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2019	Sep. 30, 2018
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares (in shares)	40,000	40,000
Common stock, issued shares (in shares)	12,036	11,889
Common stock, outstanding shares (in shares)	12,036	11,889

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Operating activities
Net income	$ 5,324	$ 1,836
Depreciation and amortization	3,956	2,242
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of deferred financing costs	982	275
Stock based compensation expense	790	1,375
Deferred taxes, net	1,792	5,502
Changes in operating assets and liabilities
Accounts receivable	617	1,631
Other current assets	(57)	(162)
Accrued payroll	178	1,260
Accounts payable, accrued expenses, and other current liabilities	5,262	54
Other long-term assets/liabilities	(805)	64
Net cash provided by operating activities	18,039	14,077
Investing activities
Business acquisition, net of cash acquired	(67,079)	0
Purchase of equipment and improvements	(405)	(654)
Net cash used in investing activities	(67,484)	(654)
Financing activities
Borrowing on senior debt	70,000	0
Repayments of senior debt	(21,708)	(11,979)
Payment of deferred financing costs	(3,451)	(65)
Proceeds from stock option exercise	39	46
Net cash provided by (used in) financing activities	44,880	(11,998)
Net change in cash and cash equivalents	(4,565)	1,425
Cash and cash equivalents at beginning of year	6,355	4,930
Cash and cash equivalents at end of year	1,790	6,355
Supplemental disclosures of cash flow information
Cash paid during the year for interest	1,502	800
Cash paid during the year for income taxes	543	876
Non-cash issuance of stock upon exercise of options	0	25
Derivative warrant liability reclassified as equity	$ 0	$ (306)

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit
Beginning Balance (shares) at Sep. 30, 2017		11,767
Beginning Balance at Sep. 30, 2017	$ 35,855	$ 12	$ 82,687	$ (46,844)
Stock-based compensation (shares)		93
Stock-based compensation	1,375		1,375
Exercise of stock options (shares)		39
Exercise of stock options	46		46
Net income	$ 1,836			1,836
Ending Balance (shares) at Sep. 30, 2018	11,889	11,899
Ending Balance at Sep. 30, 2018	$ 39,418	$ 12	84,285	(44,879)
Stock-based compensation (shares)		102
Stock-based compensation	790		790
Exercise of stock options (shares)		35
Exercise of stock options	39		39
Net income	$ 5,324			5,324
Ending Balance (shares) at Sep. 30, 2019	12,036	12,036
Ending Balance at Sep. 30, 2019	$ 45,571	$ 12	$ 85,114	$ (39,555)

Basis of Presentation

Basis of Presentation	12 Months Ended
	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements include the accounts of DLH Holdings Corp. and its subsidiaries (together with its subsidiaries, "DLH" or the "Company" and also referred to as "we," "us," and "our"), all of which are wholly owned. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and with the instructions to Form 10-K, Regulation S-X, and Regulation S-K. Certain reclassifications have been made to the prior year’s consolidated financial statements to conform to the current year presentation.

Business Overview

Business Overview	12 Months Ended
	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business Overview	Business Overview The Company is a full-service provider of technology-enabled health and human services company providing solutions to three market focus areas: Defense and Veterans' Health solutions, Human Solutions and Services, and Public Health and Life Sciences. We deliver domain-specific expertise, industry best-practices and innovations to customers across these markets leveraging seven core competencies: secure data analytics, clinical trials and laboratory services, case management, performance evaluation, system modernization, operational logistics and readiness, and strategic digital communications. The Company manages its operations from its principal executive offices in Atlanta, Georgia, and we have a complementary headquarters office in Silver Spring, Maryland. We employ over 1,900 skilled employees working in more than 30 locations throughout the United States and one location overseas. On June 7, 2019, the Company acquired Social & Scientific Systems, Inc. (“S3”), which provides clinical and biomedical research, epidemiology, health policy, and program evaluation services in the public health market. S3 utilizes advanced research (including longitudinal studies), data analytics, and secure IT platform services to assist public health agencies within the Department of Health and Human Services including the National Institutes of Health ("NIH") and the Centers for Medicare and Medicaid Services ("CMS"). The acquisition expands our ability to provide complementary services across multiple government markets. For more information, please refer to Note 15 Business Combinations . At present, the Company derives 99% of its revenue from agencies of the Federal government, primarily as a prime contractor but also as a subcontractor to other Federal prime contractors. A major customer is defined as a customer from whom the Company derives at least 10% of its revenues. Our largest customer is the VA, which comprised approximately 57% and 63% of revenue for the years ended September 30, 2019 and 2018 , respectively. Our second largest customer, HHS, comprised approximately 39% and 34% of revenue for the years ended September 30, 2019 and 2018 , respectively. The recent acquisition of S3 furthers the Company's reach into HHS, and we expect HHS to surpass the VA as our largest customer in fiscal 2020 as measured in revenue volume.

New Accounting Pronouncements

New Accounting Pronouncements	12 Months Ended
	Sep. 30, 2019
Accounting Changes and Error Corrections [Abstract]
New Accounting Pronouncements	New Accounting Pronouncements In February 2016, the FASB issued new accounting guidance included in Accounting Standard Codification ("ASC") 842 related to leases. This new accounting guidance is intended to improve financial reporting about leasing transactions. This accounting standard will require organizations that lease assets, referred to as “Lessees”, to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases with terms of more than twelve months. An organization is to provide disclosures designed to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements concerning additional information about the amounts recorded in the financial statements.The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP which requires only capital leases to be recognized on the balance sheet, new guidance will require both types of leases (i.e., operating and finance) to be recognized. Finance leases will be accounted for in substantially the same manner as capital leases. Public companies will be required to adopt the new leasing standard for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all companies and organizations. Accounting Standard Update ("ASU") 2018-11 allows companies to elect not to recast comparative periods presented when transitioning to ASC 842. The Company expects an impact in balance sheet net assets and liabilities resulting from the adoption of this new lease accounting guidance of approximately $32.7 million of lease obligations as of September 30, 2019 that will be further evaluated as the implementation of this guidance becomes effective. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. ASU 2017-04 also clarifies that an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The new standard is effective for fiscal years beginning after December 15, 2019 for both interim and annual reporting periods. The Company is currently assessing the potential impact of the adoption of ASU 2017-04 on its consolidated financial statements. In May 2017, the FASB issued Accounting Standards Update ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The Company adopted this standard in the first quarter of fiscal 2019 and adoption did not have a material impact on the Company’s consolidated financial statements. In June 2018, the FASB issued ASU 2018-07 Improvements to Nonemployee Share-Based Payment Accounting, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. The amendments are effective for fiscal years beginning after December 15, 2018, including interim periods. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. The Company is currently assessing the potential impact on the Company’s consolidated financial statements and related disclosures.

Revenue Recognition

Revenue Recognition	12 Months Ended
	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Revenue Recognition	Revenue Recognition On October 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers using the modified retrospective method. ASC 606 outlines a five-step model whereby revenue is recognized as performance obligations within the contract are satisfied. ASC 606 also requires new, expanded disclosures regarding revenue recognition. We recognized the impact of adopting ASC 606, but did not record an entry as the impact was immaterial at less than $10 thousand . Results for reporting periods beginning after October 1, 2018 are presented under ASC 606, while prior period amounts were not adjusted and will continue to be reported under ASC 605, the accounting standards in effect for those periods. In past periods, the Company recognized and recorded revenue on government contracts when: (a) persuasive evidence of an arrangement existed; (b) the services had been delivered to the customer; (c) the sales price was fixed or determinable and free of contingencies or significant uncertainties; and (d) collectibility was reasonably assured. We account for a contract when both we and the customer approve and commit; our rights and those of the customer are identified; payment terms are identified; the contract has commercial substance; and collectability of consideration is probable. At contract inception, we identify the distinct goods or services promised in the contract, referred to as performance obligations. At September 30, 2019 we have identified a single performance obligation for completed and in-process contracts. Then we determine the total transaction price for the contract; which is the total consideration which we can expect in exchange for the promised goods or services in the contract. The transaction price may include fixed or variable amounts. Due to our contracts being predominantly time and material, the Company does not have variable consideration. The transaction price is allocated to each distinct performance obligation, using our best estimate of the standalone selling price for each service promised in the contract. The primary method used to estimate standalone selling price is the hourly billing rate for each labor category identified in the contract with the customer. Revenue is recognized when, or as, the performance obligation is satisfied. We recognize revenue over time when there is a continuous transfer of control to our customer. For our U.S. government contracts, this continuous transfer of control to the customer is supported by clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. When control is transferred over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. For services contracts, we satisfy our performance obligations as services are rendered. We use a cost-based input method to measure progress. Contract costs include labor, material and allocable indirect expenses. For time-and-material contracts, we bill the customer per labor hour and per material, and revenue is recognized in the amount invoiced since the amount corresponds directly to the value of our performance to date. We consider control to transfer when we have a present right to payment. Essentially, all of our contracts satisfy their performance obligations over time. Contracts are often modified to account for changes in contract specifications and requirements. Contract modifications impact performance obligations when the modification either creates new or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue and profit cumulatively. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. For time-and-materials contracts, revenue is recognized to the extent of billable rates times hours delivered plus materials and other reimbursable costs incurred. Revenue for cost-reimbursable contracts is recorded as reimbursable costs are incurred, including an estimated share of the applicable contractual fees earned. Contract costs are expensed as incurred. Estimated losses are recognized when identified. Contract assets - Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms. In part, revenue recognition occurs before we have the right to bill, resulting in contract assets. These contract assets are reported within receivables, net on our consolidated balance sheets and are invoiced in accordance with payment terms, which are typically 30 days , defined in each contract. Period end balances will vary from period to period due to agreed-upon contractual terms. Contract liabilities - Amounts are a result of billings in excess of costs incurred. The following table summarizes the contract balances recognized within the Company's consolidated balance sheets: (in thousands) September 30, September 30, 2019 2018 Contract assets $ 4,302 $ 214 Contract liabilities $ 92 $ — The change in contract asset and liability balances at September 30, 2019 was due to the S3 acquisition, which contributed contracts assets of $3.1 million and contract liabilities of $0.1 million . Disaggregation of revenue from contracts with customers We disaggregate our revenue from contracts with customers by customer, contract type, as well as whether the Company acts as prime contractor or subcontractor. We believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. The following series of tables presents our revenue disaggregated by these categories: Revenue by customer: (in thousands) Year Ended September 30, 2019 Department of Veterans Affairs $ 91,949 Department of Health and Human Services 62,000 Other 6,442 Total revenue $ 160,391 Revenue by contract type: (in thousands) Year Ended September 30, 2019 Time and materials $ 134,136 Cost reimbursable 23,200 Firm fixed price 3,055 Total revenue $ 160,391 Revenue by whether the Company acts as a prime contractor or a subcontractor: (in thousands) Year Ended September 30, 2019 Prime $ 154,207 Subcontractor 6,184 Total revenue $ 160,391

Supporting Financial Informatio

Supporting Financial Information	12 Months Ended
	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Supporting Financial Information	Supporting Financial Information Accounts receivable (in thousands) September 30, September 30, Ref 2019 2018 Billed receivables $ 18,924 $ 10,066 Contract assets 4,302 214 Total accounts receivable 23,226 10,280 Less: Allowance for doubtful accounts (a) — — Accounts receivable, net $ 23,226 $ 10,280 Ref (a): Accounts receivable are non-interest bearing, unsecured and carried at net realizable value. We evaluate our receivables on a quarterly basis and determine whether an allowance is appropriate based on specific collection issues. No allowance for doubtful accounts was deemed necessary at either September 30, 2019 or September 30, 2018 . Other current assets (in thousands) September 30, September 30, 2019 2018 Prepaid insurance and benefits $ 495 $ 401 Other receivables 301 319 Prepaid expenses 1,035 40 Other current assets $ 1,831 $ 760 Equipment and improvements, net (in thousands) September 30, September 30, Ref 2019 2018 Furniture and equipment $ 1,262 $ 326 Computer equipment 1,043 751 Computer software 3,985 1,731 Leasehold improvements 1,595 66 Total equipment and improvements 7,885 2,874 Less accumulated depreciation and amortization (2,542 ) (1,308 ) Equipment and improvements, net (a) $ 5,343 $ 1,566 Ref (a): Equipment and improvements are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives ( 3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Maintenance and repair costs are expensed as incurred. Depreciation and amortization was $1.2 million and $0.5 million for the years ended September 30, 2019 and 2018 , respectively. Intangible assets, net (in thousands) September 30, September 30, Ref 2019 2018 Intangible assets (a) Customer contracts and related customer relationships $ 45,600 $ 16,626 Covenants not to compete 480 480 Trade name 2,109 517 Total intangible assets 48,189 17,623 Less accumulated amortization Customer contracts and related customer relationships (6,590 ) (4,018 ) Covenants not to compete (164 ) (116 ) Trade name (227 ) (124 ) Total accumulated amortization (6,981 ) (4,258 ) Intangible assets, net $ 41,208 $ 13,365 Ref (a): Intangible assets are amortized on a straight-line basis over their estimated useful lives of 10 years. Total amount of amortization expense for the year ended September 30, 2019 and 2018 was $2.7 million and $1.8 million , respectively. Estimated amortization expense for future years: (in thousands) Fiscal 2020 $ 4,723 Fiscal 2021 4,723 Fiscal 2022 4,723 Fiscal 2023 4,723 Thereafter 22,316 Total amortization expense $ 41,208 Goodwill The changes in the carrying amount of goodwill for the years ended September 30, 2019 and 2018 are as follows: (in thousands) Total Balance at September 30, 2017 $ 25,989 Increase from acquisition — Balance at September 30, 2018 25,989 Increase from acquisition 26,769 Balance at September 30, 2019 52,758 Refer to Note 15, Business Combinations for more information of the recent acquisition on June 7, 2019. Accounts payable, accrued expenses and other current liabilities (in thousands) September 30, September 30, 2019 2018 Accounts payable $ 10,054 $ 3,393 Accrued benefits 2,252 2,060 Accrued bonus and incentive compensation 1,951 2,191 Accrued workers' compensation insurance 4,007 2,642 Other accrued expenses 2,369 664 Accounts payable, accrued expenses, and other current liabilities $ 20,633 $ 10,950 Debt obligations (in thousands) September 30, September 30, 2019 2018 Bank term loan $ 56,000 $ 7,708 Less unamortized deferred financing cost (2,371 ) (750 ) Net bank debt obligation 53,629 6,958 Less current portion of bank debt obligations — — Long term portion of bank debt obligation $ 53,629 $ 6,958 Interest expense (in thousands) Years Ended September 30, Ref 2019 2018 Interest expense (a) $ (1,512 ) $ (800 ) Amortization of deferred financing costs (b) (982 ) (275 ) Other income (expense), net 21 (41 ) Interest expense, net $ (2,473 ) $ (1,116 ) Ref (a): Interest expense on borrowing Ref (b): Amortization of expenses related to securing financing

Cash and Credit Facilities

Cash and Credit Facilities	12 Months Ended
	Sep. 30, 2019
Cash and Cash Equivalents [Abstract]
Cash and Credit Facilities	Credit Facilities A summary of our loan facilities and subordinated debt financing as of September 30, 2019 is as follows: ($ in Millions) As of September 30, 2019 Lender Arrangement Loan Balance Interest Maturity Date First National Bank of Pennsylvania Secured term loan (a) $ 56.0 LIBOR* + 4.0% 06/07/24 First National Bank of Pennsylvania Secured revolving line of credit (b) $ — LIBOR* + 4.0% 06/07/24 * LIBOR rate as of September 30, 2019 was 2.10% (a) Represents the principal amounts payable on our secured term loan. The $70.0 million secured term loan is secured by liens on substantially all of the assets of the Company. The principal of the term loan is payable in quarterly installments with the remaining balance due on June 7, 2024 . The Company made voluntary prepayments of term debt of $12.7 million in the year ending September 30, 2019, which satisfies mandatory principal amortization until March 31, 2022. The Credit Agreement requires compliance with a number of financial covenants and contains restrictions on our ability to engage in certain transactions. Among other matters, we must comply with limitations on: granting liens; incurring other indebtedness; maintenance of assets; investments in other entities and extensions of credit; mergers and consolidations; and changes in nature of business. The loan agreement also requires us to comply with certain quarterly financial covenants including: (i) a minimum fixed charge coverage ratio of at least 1.25 to 1.00 commencing with the quarter ending September 30, 2019, and for all subsequent periods, and (ii) a Funded Indebtedness to Adjusted EBITDA ratio not exceeding the ratio of 4.25 :1.0 to 3.25 :1.0 through maturity. Adjusted EBITDA ratio is calculated by dividing the Company's total interest-bearing debt by net income adjusted to exclude (i) interest and other expenses, (ii) provision for or benefit from income taxes, if any, (iii) depreciation and amortization, and (iv) non-recurring charges, losses or expenses to include transaction and non-cash equity expense. The term loan has an interest rate spread range from 2.5% to 4.5% depending on the funded indebtedness to adjusted EBITDA ratio. We are in compliance with all loan covenants and restrictions. In addition to quarterly payments of the outstanding indebtedness, the loan agreement also requires annual payments of a percentage of excess cash flow, as defined in the loan agreement. The loan agreement states that an excess cash flow recapture payment must be made equal to (a) 75% of the excess cash flow for the immediately preceding fiscal year in which indebtedness to consolidated EBITDA ratio is greater than or equal to 2.50 :1.0; (b) 50% of the excess cash flow for the immediately preceding fiscal year in which the funded indebtedness to consolidated EBITDA Ratio is less than 2.50 :1.0 but greater than or equal to 1.5 :1.0; or (c) 0% of the excess cash flow for the immediately preceding fiscal year in which the funded indebtedness to consolidated EBITDA Ratio is less than 1.5 :1.0. In addition, the Company must make additional mandatory prepayment of amounts outstanding based on proceeds received from asset sales and sales of certain equity securities or other indebtedness. On September 30, 2019, we executed a floating-to-fixed interest rate swap with First National Bank as counter party. The notional amount in the floating-to-fixed interest rate swap is $36 million ; the remaining outstanding balance of our term loan is subject to interest rate fluctuations. For additional information regarding the schedule of future payment obligations, please refer to Note 10, Commitments and Contingencies. (b) The secured revolving line of credit has a ceiling of up to $25.0 million . Borrowing on the line of credit is secured by liens on substantially all of the assets of the Company. The Company did not access funds from the revolving credit facility at the closing, and such facility will be available to support future cash needs. The Company's total borrowing availability, based on eligible accounts receivables at September 30, 2019 , was $16.3 million . We had unused borrowing capacity of $16.3 million . As part of the revolving credit facility, the lenders agreed to a sublimit of $3 million for letters of credit for the account of the Company, subject to applicable procedures. The revolving line of credit has a maturity date of June 7, 2024 and is subject to loan covenants as described above. The Company is fully compliant with those covenants.

Significant Accounting Policies

Significant Accounting Policies	12 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
Significant Accounting Policies	Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include valuation of goodwill and intangible assets, measurement of prepaid workers’ compensation, valuation allowances established against deferred tax assets, measurement of contingent liabilities, accounts payable, workers’ compensation claims, and accrued expenses and the valuation of derivative financial instruments associated with debt agreements. In addition, the Company estimates overhead charges and allocates such charges throughout the year. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current and expected future outcomes, third-party evaluations and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. We revise material accounting estimates if changes occur, such as more experience is acquired, additional information is obtained, or there is new information on which an estimate was or can be based. Actual results could differ from those estimates. In particular, a material reduction in the fair value of goodwill would have a material adverse effect on the Company’s financial position and results of operations. Fair Value of Financial Instruments The carrying amounts of the Company's cash and cash equivalents, accounts receivable, unbilled receivables, contract assets, accrued expenses, and accounts payable approximate fair value due to the short-term nature of these instruments. The fair values of the Company's debt instruments approximate fair value because the underlying interest rates approximate market rates that the Company could obtain for similar instruments at the balance sheet dates. Goodwill and other intangible assets We have used the acquisition method of accounting for the S3 transaction, whereby the assets acquired and liabilities assumed are recognized based upon their estimated fair values at the acquisition date. The fair values of assets acquired and liabilities assumed are based on all available information. Final values of purchase price allocation are shown under Note 15, Business Combinations . The Company recognized amortization expense of approximately $1.0 million for the acquired identifiable intangible assets of S3. The Company continues to review its goodwill and other intangible assets for possible impairment or loss of value at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. At September 30, 2019 , we performed a goodwill impairment evaluation on the year-end carrying value of approximately $52.8 million . We performed a qualitative assessment of factors to determine whether it was necessary to perform the goodwill impairment test. Based on the results of the work performed, the Company has concluded that no impairment loss was warranted at September 30, 2019 , as no change in business conditions occurred which would have a material adverse effect on the valuation of goodwill. Notwithstanding this evaluation, factors including non-renewal of a major contract or other substantial changes in business conditions could have a material adverse effect on the valuation of goodwill in future periods and the resulting charge could be material to future periods’ results of operations. Similarly, there were no impairments during the prior year ended September 30, 2018 . Long Lived Assets Equipment and improvements are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives ( 3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Income Taxes The Company accounts for income taxes in accordance with the liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the consolidated balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits, it is "more-likely-than-not" that the position will be sustained upon examination. We had no uncertain tax positions at either September 30, 2019 and 2018 . We report interest and penalties as a component of income tax expense. In the years ended September 30, 2019 and 2018 , we recognized no interest and no penalties related to income taxes. Stock-based Equity Compensation The Company uses the fair value-based method for stock-based equity compensation. Options issued are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued common shares. All awards to employees and non-employees are recorded at fair value on the date of the grant and expensed over the period of vesting. The Company uses a binomial option pricing model to estimate the fair value of each stock option at the date of grant. Any consideration paid by the option holders to purchase shares is credited to capital stock. Cash and Cash Equivalents We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 . Deposits held with financial institutions may exceed the $250,000 limit. Earnings per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common stock outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities such as common stock warrants and stock options. Diluted earnings per share is calculated using the treasury stock method.

Stock-based Compensation and Eq

Stock-based Compensation and Equity Grants	12 Months Ended
	Sep. 30, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation and Equity Grants	Stock-based compensation and equity grants Stock-based compensation expense Options issued under equity incentive plans were designated as either an incentive stock or a non-statutory stock option. No option was granted with a term of more than 10 years from the date of grant. Exercisability of option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued shares. As of September 30, 2019 , there were 1.5 million shares available for grant under the Company's 2016 Omnibus Equity Incentive Plan. Stock-based compensation expense, shown in the table below, is recorded in general and administrative expenses included in our consolidated statement of operations: (in thousands) Year Ended Ref September 30, 2019 2018 DLH employees $ 263 $ 266 Non-employee directors (a) 527 1,109 Total stock option expense $ 790 $ 1,375 Ref (a): Represents equity grants issued, in accordance with DLH compensation policy for non-employee directors on November 9, 2018, an aggregate of 101,667 shares of Common Stock of the Company were issued to the non-employee members of the Company's Board of Directors, in accordance with the Company's compensation policy for non-employee directors. During the fiscal year ended September 30, 2019 , the Company revised its Board compensation policy to provide that equity grants were earned ratably throughout the year rather than retrospectively in the quarter following the completion of the fiscal year and in December 2018 we issued 90,000 restricted stock units to the Company's non-employee directors, all of which vested as of September 30, 2019. The shares of common stock underlying such restricted stock units were issued on November 7, 2019. Unrecognized stock-based compensation expense (in thousands) Year Ended September 30, Ref 2019 2018 Unrecognized expense for DLH employees (a) $ 631 $ 876 Ref (a): Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance. For options that vest based on the Company’s common stock achieving and maintaining defined market prices, the Company values the awards with a Monte Carlo binomial model that utilizes various probability factors and other criterion in establishing fair value of the grant. The related compensation expense is recognized over the derived service period determined in the valuation. On a weighted average basis, this expense is expected to be recognized within the next 4.14 years . Stock option activity for the year ended September 30, 2019 : The aggregate intrinsic value in the table below represents the total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their in the money options on those dates. This amount will change based on the fair market value of the Company’s stock. (in years) Weighted Weighted Average (in thousands) (in thousands) Average Remaining Aggregate Number of Exercise Contractual Intrinsic Ref Shares Price Term Value Options outstanding, September 30, 2018 2,134 $4.31 6.3 $ 6,949 Granted (a) 35 $5.25 Exercised or canceled (35 ) $1.12 Options outstanding, September 30, 2019 2,134 $4.36 5.9 $ 4,815 Ref (a): The weighted average value for the shares granted in fiscal 2019 was estimated to be $3.82 per share. Stock options shares outstanding, vested and unvested for the period ended: (in thousands) Number of Shares September 30, Ref 2019 2018 Vested and exercisable (a) 1,300 1,335 Unvested (b) 834 799 Options outstanding 2,134 2,134 Ref (a): Weighted average exercise price of vested and exercisable shares was $1.51 and $1.50 at September 30, 2019 and 2018, respectively. Aggregate intrinsic value was approximately $3.9 million and $5.7 million at September 30, 2019 and 2018, respectively. Weighted average contractual term remaining was 3.8 years years and 4.5 years at September 30, 2019 and 2018, respectively. Ref (b): Certain awards vest upon satisfaction of certain performance criteria.

Earnings Per Share

Earnings Per Share	12 Months Ended
	Sep. 30, 2019
Earnings Per Share [Abstract]
Earnings Per Share	Earnings Per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common shares outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method. (in thousands) Year Ended September 30, 2019 2018 Numerator: Net income $ 5,324 $ 1,836 Denominator: Denominator for basic net income per share - weighted-average outstanding shares 12,018 11,881 Effect of dilutive securities: Stock options and restricted stock 1,023 992 Denominator for diluted net income per share - weighted-average outstanding shares 13,041 12,873 Net income per share - basic $ 0.44 $ 0.15 Net income per share - diluted $ 0.41 $ 0.14

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Contractual Obligations as of September 30, 2019 : Payments Due By Period Contractual obligations Next 12 2-3 4-5 More than 5 (Amounts in thousands) Total Months Years Years Years Debt obligations $ 56,000 $ — $ 5,250 $ 50,750 $ — Facility leases 32,731 3,423 6,135 6,228 16,945 Equipment operating leases 151 61 52 38 — Total Contractual Obligations $ 88,882 $ 3,484 $ 11,437 $ 57,016 $ 16,945 Workers' Compensation We accrue workers' compensation expense based on claims submitted, applying actuarial loss development factors to estimate the costs incurred but not yet recorded. Our accrued liability for claims development as of September 30, 2019 and September 30, 2018 was approximately $4.0 million and $2.6 million , respectively. Legal Proceedings As a commercial enterprise and employer, the Company is subject to various claims and legal actions in the ordinary course of business. These matters can include professional liability, employment-relations issues, workers’ compensation, tax, payroll and employee-related matters, other commercial disputes arising in the course of its business, and inquiries and investigations by governmental agencies regarding our employment practices or other matters. The Company is not aware of any pending or threatened litigation that it believes is reasonably likely to have a material adverse effect on its results of operations, financial position or cash flows.

Related Party Transactions

Related Party Transactions	12 Months Ended
	Sep. 30, 2019
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions The Company has determined that for the year ended September 30, 2019 and 2018 and through the filing date of this report, there were no significant related party transactions that have occurred which require disclosure through the date that these financial statements were issued.

Income Taxes

Income Taxes	12 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company accounts for income taxes in accordance with the liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized. We will also set up a valuation allowance, reducing the carrying value of deferred tax assets if it is more likely than not that some or all of the deferred tax asset will not be realized, based on estimated future taxable income. Presently, the Company has no deferred tax asset valuation allowances. During the fiscal year ending September 30, 2018, the Company recognized a $3.4 million write-down of deferred tax assets from revaluation of our net operating loss carryforwards from the previously recognized federal income tax rate of 34% to the 21% rate in the 2017 Tax Act enacted in December 2017. In addition to this discrete item the Company recognized $2.4 million of income tax expense associated with current operations resulting in total income tax expense of $5.8 million for the 2018 fiscal year. The fiscal year 2018 effective tax rate, excluding the discrete item associated with the deferred tax asset write-down was 32.2% as compared to the prior year effective tax rate of 39.1% . The effective tax rate for fiscal 2019 was 29% . At September 30, 2019 and 2018 , respectively, the Company had federal net operating losses of approximately $17.2 million and $23.8 million . The Company utilized approximately $7.2 million of federal net operating losses to offset taxes otherwise currently due in 2020. The federal NOLs begin to expire in 2021 and continue to expire through 2033. The Company has no material state net operating losses carryforward. A provision of the 2017 Tax Act repealed the alternative minimum tax (AMT). Additionally, prior AMT paid is either creditable against regular tax liability or refundable. For tax years beginning after 2017 and before 2022, 50 percent of AMT credits are refundable; from 2022, the credits are fully refundable. The Company has AMT credits of $366 thousand as of the year ended September 30, 2019 , of which 50 percent has been established as an income tax receivable in current assets. An analysis of the Company's deferred tax assets and liabilities is as follows: Year Ended September 30, (amounts in thousands) 2019 2018 Deferred income tax assets: Net operating loss carry forwards $ 3,926 $ 5,005 AMT credit carryforward 183 185 Stock based compensation 140 140 Accrued expenses 1,666 1,202 Other items, net 45 45 Total deferred tax asset 5,960 6,577 Deferred tax liability: Equipment and intangible assets (3,615 ) (2,440 ) Net deferred tax asset $ 2,345 $ 4,137 The significant components of income tax expense for income taxes from continuing operations are summarized as follows: Year Ended September 30, (amounts in thousands) 2019 2018 Current expense $ 379 $ 328 Deferred expense 1,792 5,502 Total expense $ 2,171 $ 5,830 The following table indicates the significant differences between our income taxes at the federal statutory rate and the Company's effective tax rate for continuing operations: Year Ended September 30, (amounts in thousands) Ref 2019 2018 Federal statutory rate $ 1,574 $ 1,861 State taxes, net 407 393 Other permanent items 91 77 Deferred tax estimate adjustment 99 134 Discrete item (a) — 3,365 Total $ 2,171 $ 5,830 (a): Write-down of deferred tax assets due to change in federal income tax rate from the 2017 Tax Act. We file income tax returns in the U.S. federal jurisdiction and in various state jurisdictions. We are no longer subject to income tax examinations for years before 2015.

Quarterly Financial Data (Unaud

Quarterly Financial Data (Unaudited)	12 Months Ended
	Sep. 30, 2019
Quarterly Financial Information Disclosure [Abstract]
Quarterly Financial Data (Unaudited)	Quarterly Financial Data (Unaudited) A summary of quarterly information is as follows (in thousands, except per share data) 2019 Quarters Ref First Second Third Fourth Revenue (a) $ 33,752 $ 33,756 $ 38,700 $ 54,183 Income from operations 2,557 2,327 1,690 3,394 Interest expense, net (177 ) (545 ) (562 ) (1,190 ) Income before income taxes 2,380 $ 1,782 1,128 2,204 Income tax expense 690 $ 517 325 639 Net income $ 1,690 $ 1,265 $ 803 $ 1,565 Earnings per share: Basic $ 0.14 $ 0.11 $ 0.07 $ 0.13 Diluted $ 0.13 $ 0.10 $ 0.06 $ 0.12 2018 Quarters Ref First Second Third Fourth Revenue $ 30,215 $ 34,401 $ 36,131 $ 32,489 Income from operations 1,146 2,204 2,614 2,819 Interest expense, net (278 ) (261 ) (262 ) (315 ) Income before income taxes 868 1,943 2,352 2,504 Income tax expense (b) 3,719 627 738 747 Net income (loss) $ (2,851 ) $ 1,316 $ 1,614 $ 1,757 Earnings (loss) per share: Basic $ (0.24 ) $ 0.11 $ 0.14 $ 0.15 Diluted $ (0.24 ) $ 0.10 $ 0.13 $ 0.14 _______________________________________________________________________________ Ref (a): The third and fourth quarters of fiscal 2019 include the results of operations of S3. Ref (b): Refer to Note 12, Income Taxes , for a detailed explanation of the $3.4 million income tax discrete charge in fiscal year 2018, related to the 2017 Tax Cut and Jobs Act.

Employee Benefit Plans

Employee Benefit Plans	12 Months Ended
	Sep. 30, 2019
Retirement Benefits [Abstract]
Employee Benefits Plans	Employee Benefit Plans As of September 30, 2019 , the Company and its subsidiaries maintain a 401(k) Plan (the "401(k) Plan"), a defined contribution and supplemental pension plan for the benefit of its eligible employees. The Company may provide a discretionary matching contribution of a participant's elective contributions under the 401 (k) Plan. The Company recorded related expense of $577 thousand in fiscal 2019 and $222 thousand in fiscal year 2018 . A participant is always fully vested in his or her elective contributions and vests in Company matching contributions over a four year period.

Business Combinations

Business Combinations	12 Months Ended
	Sep. 30, 2019
Business Combinations [Abstract]
Business Combinations	Business Combinations: Acquisition of Social and Scientific Systems, Inc. ("S3") On June 7, 2019, the Company acquired 100% of the equity interests of S3 for a net purchase price of $67.1 million , or $70.1 million inclusive of cash acquired of $3.0 million . The acquisition was financed through a combination of: • borrowings of $70 million under the Company’s new senior credit facility • cash on hand to pay transaction expenses and financings costs of $4.9 million The acquisition of S3 is consistent with the Company’s growth strategy, as it provided contract diversification, addition of key capabilities and increased presence in the public health market. We have used the acquisition method of accounting for this transaction, whereby the assets acquired and liabilities assumed are recognized based upon their estimated fair values at the acquisition date. The preliminary base purchase price for S3 was $70 million adjusted to reflect acquired cash, assumed liabilities and preliminary net working capital adjustments. The final purchase price of $70.1 million was determined based on S3’s final debt, transaction costs, net working capital, and other adjustments, as determined in accordance with the Purchase Agreement. The Company has remitted all necessary payments to the seller as a result of purchase price adjustments. Subject to certain limitations and conditions, the Company will be indemnified by the seller for damages resulting from breaches or inaccuracies of the representations, warranties, and covenants of the seller and S3 as set forth in the Purchase Agreement. The Purchase Agreement further provides that escrow funds of an aggregate amount of approximately $1.2 million were established at closing. The Company does not expect to draw on these funds as both the buyer and seller have agreed on the final purchase price. A representations and warranties insurance policy has been purchased by the Company in connection with the Purchase Agreement, under which the Company may seek recourse for breaches of the seller’s representations and warranties to supplement the indemnity escrow. The representations and warranties insurance policy is subject to certain customary exclusions and a deductible. In accordance with ASU 2017-01, which was previously adopted, the Company is accounting for this transaction as an acquisition of a business. We have completed the process of allocating the acquisition price to the fair value of the assets and liabilities of S3 at the acquisition date. The purchase price and its allocation are shown below. Based on the unaudited financial statements of S3 on June 7, 2019, we accounted for the total acquisition consideration and allocation of fair value to the related assets and liabilities as follows: (Amounts in thousands) Final purchase price for S3 $ 70,115 Net assets acquired Cash and cash equivalents $ 3,037 Accounts receivable 13,038 Other current assets 1,418 Total current assets 17,493 Accounts payable and accrued expenses (4,488 ) Payroll liabilities (3,624 ) Long term liabilities (1,206 ) Net working capital 8,175 Equipment and improvements, net 4,605 Net identifiable assets acquired 12,780 Goodwill 26,769 Customer contracts and related customer relationships 28,974 Trade name 1,592 Intangible assets acquired 57,335 Net assets acquired $ 70,115 During the year ended September 30, 2019, S3 contributed approximately $24.3 million of revenue and $1.3 million of income from operations. All operating units are aggregated into a single reportable segment. The acquisition of S3 did not create an additional reportable segment as all operations report to a single Chief Operating Decision Maker (CODM), serve a similar customer base, and provide similar services within a common regulatory environment. The goodwill represents intellectual capital and the acquired workforce, of which both do not qualify as a separate intangible asset. The tax deductible goodwill is $26.8 million . The following table presents certain results for the years ended September 30, 2019 and 2018 as though the acquisition of S3 had occurred on October 1, 2017. The unaudited pro forma information is presented for informational purposes only and is not necessarily indicative of our results if the acquisition had taken place on that date. The pro forma information was prepared by combining our reported historical results with the historical results of S3 for the pre-acquisition periods. In addition, the reported historical amounts were adjusted for the following items, net of associated tax effects: • The impact of acquisition financing. • The removal of certain S3 operations due to completed and nonrecurring contracts. • The removal of the legacy S3 Employee Stock Ownership Plan ("ESOP") expenses. • The removal of S3's historical goodwill amortization. • The impact of recording S3's intangible asset amortization. • The removal of S3's historical debt-related interest expense. • The impact of interest expense for the new credit facility. • The removal of legacy S3 director's fees. • The removal of transaction costs for the acquisition incurred by S3. (unaudited) (in thousands) Year ended September 30, Pro forma results Ref 2019 2018 Revenue $ 204,043 $ 203,287 Net income (loss) (a) 2,044 (1,456 ) Number of shares outstanding - basic 12,018 11,881 Number of shares outstanding - diluted 13,041 12,873 Basic earnings per share (loss) $ 0.17 $ (0.12 ) Diluted earnings per share (loss) $ 0.16 $ (0.11 ) Ref (a): Fiscal 2018 results include the impact of writing down the deferred tax asset by $3.4 million . The write down is further described in Note 12 - Income Taxes .

Subsequent Events

Subsequent Events	12 Months Ended
	Sep. 30, 2019
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events Management has evaluated subsequent events through the date that the Company's consolidated financial statements were issued. Based on this evaluation, the Company has determined that no further subsequent events have occurred which require disclosure through the date that these consolidated financial statements were issued.

Significant Accounting Polici_2

Significant Accounting Policies (Policies)	12 Months Ended
	Sep. 30, 2019
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements include the accounts of DLH Holdings Corp. and its subsidiaries (together with its subsidiaries, "DLH" or the "Company" and also referred to as "we," "us," and "our"), all of which are wholly owned. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and with the instructions to Form 10-K, Regulation S-X, and Regulation S-K.
Reclassifications	Certain reclassifications have been made to the prior year’s consolidated financial statements to conform to the current year presentation.
New Accounting Pronouncements	New Accounting Pronouncements In February 2016, the FASB issued new accounting guidance included in Accounting Standard Codification ("ASC") 842 related to leases. This new accounting guidance is intended to improve financial reporting about leasing transactions. This accounting standard will require organizations that lease assets, referred to as “Lessees”, to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases with terms of more than twelve months. An organization is to provide disclosures designed to enable users of financial statements to understand the amount, timing, and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements concerning additional information about the amounts recorded in the financial statements.The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP which requires only capital leases to be recognized on the balance sheet, new guidance will require both types of leases (i.e., operating and finance) to be recognized. Finance leases will be accounted for in substantially the same manner as capital leases. Public companies will be required to adopt the new leasing standard for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all companies and organizations. Accounting Standard Update ("ASU") 2018-11 allows companies to elect not to recast comparative periods presented when transitioning to ASC 842. The Company expects an impact in balance sheet net assets and liabilities resulting from the adoption of this new lease accounting guidance of approximately $32.7 million of lease obligations as of September 30, 2019 that will be further evaluated as the implementation of this guidance becomes effective. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. ASU 2017-04 also clarifies that an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The new standard is effective for fiscal years beginning after December 15, 2019 for both interim and annual reporting periods. The Company is currently assessing the potential impact of the adoption of ASU 2017-04 on its consolidated financial statements. In May 2017, the FASB issued Accounting Standards Update ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The Company adopted this standard in the first quarter of fiscal 2019 and adoption did not have a material impact on the Company’s consolidated financial statements. In June 2018, the FASB issued ASU 2018-07 Improvements to Nonemployee Share-Based Payment Accounting, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. The amendments are effective for fiscal years beginning after December 15, 2018, including interim periods. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. The Company is currently assessing the potential impact on the Company’s consolidated financial statements and related disclosures.
Revenue Recognition	Revenue Recognition On October 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers using the modified retrospective method. ASC 606 outlines a five-step model whereby revenue is recognized as performance obligations within the contract are satisfied. ASC 606 also requires new, expanded disclosures regarding revenue recognition. We recognized the impact of adopting ASC 606, but did not record an entry as the impact was immaterial at less than $10 thousand . Results for reporting periods beginning after October 1, 2018 are presented under ASC 606, while prior period amounts were not adjusted and will continue to be reported under ASC 605, the accounting standards in effect for those periods. In past periods, the Company recognized and recorded revenue on government contracts when: (a) persuasive evidence of an arrangement existed; (b) the services had been delivered to the customer; (c) the sales price was fixed or determinable and free of contingencies or significant uncertainties; and (d) collectibility was reasonably assured. We account for a contract when both we and the customer approve and commit; our rights and those of the customer are identified; payment terms are identified; the contract has commercial substance; and collectability of consideration is probable. At contract inception, we identify the distinct goods or services promised in the contract, referred to as performance obligations. At September 30, 2019 we have identified a single performance obligation for completed and in-process contracts. Then we determine the total transaction price for the contract; which is the total consideration which we can expect in exchange for the promised goods or services in the contract. The transaction price may include fixed or variable amounts. Due to our contracts being predominantly time and material, the Company does not have variable consideration. The transaction price is allocated to each distinct performance obligation, using our best estimate of the standalone selling price for each service promised in the contract. The primary method used to estimate standalone selling price is the hourly billing rate for each labor category identified in the contract with the customer. Revenue is recognized when, or as, the performance obligation is satisfied. We recognize revenue over time when there is a continuous transfer of control to our customer. For our U.S. government contracts, this continuous transfer of control to the customer is supported by clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. When control is transferred over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. For services contracts, we satisfy our performance obligations as services are rendered. We use a cost-based input method to measure progress. Contract costs include labor, material and allocable indirect expenses. For time-and-material contracts, we bill the customer per labor hour and per material, and revenue is recognized in the amount invoiced since the amount corresponds directly to the value of our performance to date. We consider control to transfer when we have a present right to payment. Essentially, all of our contracts satisfy their performance obligations over time. Contracts are often modified to account for changes in contract specifications and requirements. Contract modifications impact performance obligations when the modification either creates new or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue and profit cumulatively. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. For time-and-materials contracts, revenue is recognized to the extent of billable rates times hours delivered plus materials and other reimbursable costs incurred. Revenue for cost-reimbursable contracts is recorded as reimbursable costs are incurred, including an estimated share of the applicable contractual fees earned. Contract costs are expensed as incurred. Estimated losses are recognized when identified. Contract assets - Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms. In part, revenue recognition occurs before we have the right to bill, resulting in contract assets. These contract assets are reported within receivables, net on our consolidated balance sheets and are invoiced in accordance with payment terms, which are typically 30 days , defined in each contract. Period end balances will vary from period to period due to agreed-upon contractual terms. Contract liabilities - Amounts are a result of billings in excess of costs incurred. Disaggregation of revenue from contracts with customers We disaggregate our revenue from contracts with customers by customer, contract type, as well as whether the Company acts as prime contractor or subcontractor. We believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include valuation of goodwill and intangible assets, measurement of prepaid workers’ compensation, valuation allowances established against deferred tax assets, measurement of contingent liabilities, accounts payable, workers’ compensation claims, and accrued expenses and the valuation of derivative financial instruments associated with debt agreements. In addition, the Company estimates overhead charges and allocates such charges throughout the year. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current and expected future outcomes, third-party evaluations and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. We revise material accounting estimates if changes occur, such as more experience is acquired, additional information is obtained, or there is new information on which an estimate was or can be based. Actual results could differ from those estimates. In particular, a material reduction in the fair value of goodwill would have a material adverse effect on the Company’s financial position and results of operations.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of the Company's cash and cash equivalents, accounts receivable, unbilled receivables, contract assets, accrued expenses, and accounts payable approximate fair value due to the short-term nature of these instruments. The fair values of the Company's debt instruments approximate fair value because the underlying interest rates approximate market rates that the Company could obtain for similar instruments at the balance sheet dates.
Goodwill and Other Intangible Assets	Goodwill and other intangible assets We have used the acquisition method of accounting for the S3 transaction, whereby the assets acquired and liabilities assumed are recognized based upon their estimated fair values at the acquisition date. The fair values of assets acquired and liabilities assumed are based on all available information. Final values of purchase price allocation are shown under Note 15, Business Combinations . The Company recognized amortization expense of approximately $1.0 million for the acquired identifiable intangible assets of S3. The Company continues to review its goodwill and other intangible assets for possible impairment or loss of value at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. At September 30, 2019 , we performed a goodwill impairment evaluation on the year-end carrying value of approximately $52.8 million . We performed a qualitative assessment of factors to determine whether it was necessary to perform the goodwill impairment test. Based on the results of the work performed, the Company has concluded that no impairment loss was warranted at September 30, 2019 , as no change in business conditions occurred which would have a material adverse effect on the valuation of goodwill. Notwithstanding this evaluation, factors including non-renewal of a major contract or other substantial changes in business conditions could have a material adverse effect on the valuation of goodwill in future periods and the resulting charge could be material to future periods’ results of operations. Similarly, there were no impairments during the prior year ended September 30, 2018 .
Long Lived Assets	Long Lived Assets Equipment and improvements are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives ( 3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements.
Income Taxes	Income Taxes The Company accounts for income taxes in accordance with the liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the consolidated balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits, it is "more-likely-than-not" that the position will be sustained upon examination.
Share-based Equity Compensation	Stock-based Equity Compensation The Company uses the fair value-based method for stock-based equity compensation. Options issued are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued common shares. All awards to employees and non-employees are recorded at fair value on the date of the grant and expensed over the period of vesting. The Company uses a binomial option pricing model to estimate the fair value of each stock option at the date of grant. Any consideration paid by the option holders to purchase shares is credited to capital stock.
Cash and Cash Equivalents	Cash and Cash Equivalents We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 . Deposits held with financial institutions may exceed the $250,000 limit.
Earnings per Share	Earnings per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common stock outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities such as common stock warrants and stock options. Diluted earnings per share is calculated using the treasury stock method.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	12 Months Ended
	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Schedule of Contract Balances Recognized on the Company's Consolidated Balance Sheets	The following table summarizes the contract balances recognized within the Company's consolidated balance sheets: (in thousands) September 30, September 30, 2019 2018 Contract assets $ 4,302 $ 214 Contract liabilities $ 92 $ —
Schedule of Disaggregation of Revenue From Contracts with Customers	The following series of tables presents our revenue disaggregated by these categories: Revenue by customer: (in thousands) Year Ended September 30, 2019 Department of Veterans Affairs $ 91,949 Department of Health and Human Services 62,000 Other 6,442 Total revenue $ 160,391 Revenue by contract type: (in thousands) Year Ended September 30, 2019 Time and materials $ 134,136 Cost reimbursable 23,200 Firm fixed price 3,055 Total revenue $ 160,391 Revenue by whether the Company acts as a prime contractor or a subcontractor: (in thousands) Year Ended September 30, 2019 Prime $ 154,207 Subcontractor 6,184 Total revenue $ 160,391

Supporting Financial Informat_2

Supporting Financial Information (Tables)	12 Months Ended
	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Accounts Receivable	Accounts receivable (in thousands) September 30, September 30, Ref 2019 2018 Billed receivables $ 18,924 $ 10,066 Contract assets 4,302 214 Total accounts receivable 23,226 10,280 Less: Allowance for doubtful accounts (a) — — Accounts receivable, net $ 23,226 $ 10,280 Ref (a): Accounts receivable are non-interest bearing, unsecured and carried at net realizable value. We evaluate our receivables on a quarterly basis and determine whether an allowance is appropriate based on specific collection issues. No allowance for doubtful accounts was deemed necessary at either September 30, 2019 or September 30, 2018 .
Schedule of Other Current Assets	Other current assets (in thousands) September 30, September 30, 2019 2018 Prepaid insurance and benefits $ 495 $ 401 Other receivables 301 319 Prepaid expenses 1,035 40 Other current assets $ 1,831 $ 760
Schedule of Equipment and Improvements, Net	Equipment and improvements, net (in thousands) September 30, September 30, Ref 2019 2018 Furniture and equipment $ 1,262 $ 326 Computer equipment 1,043 751 Computer software 3,985 1,731 Leasehold improvements 1,595 66 Total equipment and improvements 7,885 2,874 Less accumulated depreciation and amortization (2,542 ) (1,308 ) Equipment and improvements, net (a) $ 5,343 $ 1,566 Ref (a): Equipment and improvements are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives ( 3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Maintenance and repair costs are expensed as incurred. Depreciation and amortization was $1.2 million and $0.5 million for the years ended September 30, 2019 and 2018 , respectively.
Schedule of Intangible Assets, Net	Intangible assets, net (in thousands) September 30, September 30, Ref 2019 2018 Intangible assets (a) Customer contracts and related customer relationships $ 45,600 $ 16,626 Covenants not to compete 480 480 Trade name 2,109 517 Total intangible assets 48,189 17,623 Less accumulated amortization Customer contracts and related customer relationships (6,590 ) (4,018 ) Covenants not to compete (164 ) (116 ) Trade name (227 ) (124 ) Total accumulated amortization (6,981 ) (4,258 ) Intangible assets, net $ 41,208 $ 13,365 Ref (a): Intangible assets are amortized on a straight-line basis over their estimated useful lives of 10 years. Total amount of amortization expense for the year ended September 30, 2019 and 2018 was $2.7 million and $1.8 million , respectively.
Schedule of Estimated Future Amortization Expense of Finite-lived Intangibles	Estimated amortization expense for future years: (in thousands) Fiscal 2020 $ 4,723 Fiscal 2021 4,723 Fiscal 2022 4,723 Fiscal 2023 4,723 Thereafter 22,316 Total amortization expense $ 41,208
Schedule of Goodwill	The changes in the carrying amount of goodwill for the years ended September 30, 2019 and 2018 are as follows: (in thousands) Total Balance at September 30, 2017 $ 25,989 Increase from acquisition — Balance at September 30, 2018 25,989 Increase from acquisition 26,769 Balance at September 30, 2019 52,758 Refer to Note 15, Business Combinations for more information of the recent acquisition on June 7, 2019.
Schedule of Accounts Payable, Accrued Expenses, and Other Current Liabilities	Accounts payable, accrued expenses and other current liabilities (in thousands) September 30, September 30, 2019 2018 Accounts payable $ 10,054 $ 3,393 Accrued benefits 2,252 2,060 Accrued bonus and incentive compensation 1,951 2,191 Accrued workers' compensation insurance 4,007 2,642 Other accrued expenses 2,369 664 Accounts payable, accrued expenses, and other current liabilities $ 20,633 $ 10,950
Schedule of Debt Obligations	Debt obligations (in thousands) September 30, September 30, 2019 2018 Bank term loan $ 56,000 $ 7,708 Less unamortized deferred financing cost (2,371 ) (750 ) Net bank debt obligation 53,629 6,958 Less current portion of bank debt obligations — — Long term portion of bank debt obligation $ 53,629 $ 6,958
Schedule of Interest Expense	Interest expense (in thousands) Years Ended September 30, Ref 2019 2018 Interest expense (a) $ (1,512 ) $ (800 ) Amortization of deferred financing costs (b) (982 ) (275 ) Other income (expense), net 21 (41 ) Interest expense, net $ (2,473 ) $ (1,116 ) Ref (a): Interest expense on borrowing Ref (b): Amortization of expenses related to securing financing

Cash and Credit Facilities (Tab

Cash and Credit Facilities (Tables)	12 Months Ended
	Sep. 30, 2019
Cash and Cash Equivalents [Abstract]
Schedule of Loan Facilities and Subordinated Debt Financing	A summary of our loan facilities and subordinated debt financing as of September 30, 2019 is as follows: ($ in Millions) As of September 30, 2019 Lender Arrangement Loan Balance Interest Maturity Date First National Bank of Pennsylvania Secured term loan (a) $ 56.0 LIBOR* + 4.0% 06/07/24 First National Bank of Pennsylvania Secured revolving line of credit (b) $ — LIBOR* + 4.0% 06/07/24 * LIBOR rate as of September 30, 2019 was 2.10%

Stock-based Compensation and _2

Stock-based Compensation and Equity Grants (Tables)	12 Months Ended
	Sep. 30, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Stock-based Compensation Expense	Stock-based compensation expense, shown in the table below, is recorded in general and administrative expenses included in our consolidated statement of operations: (in thousands) Year Ended Ref September 30, 2019 2018 DLH employees $ 263 $ 266 Non-employee directors (a) 527 1,109 Total stock option expense $ 790 $ 1,375 Ref (a): Represents equity grants issued, in accordance with DLH compensation policy for non-employee directors on November 9, 2018, an aggregate of 101,667 shares of Common Stock of the Company were issued to the non-employee members of the Company's Board of Directors, in accordance with the Company's compensation policy for non-employee directors. During the fiscal year ended September 30, 2019 , the Company revised its Board compensation policy to provide that equity grants were earned ratably throughout the year rather than retrospectively in the quarter following the completion of the fiscal year and in December 2018 we issued 90,000 restricted stock units to the Company's non-employee directors, all of which vested as of September 30, 2019. The shares of common stock underlying such restricted stock units were issued on November 7, 2019. Unrecognized stock-based compensation expense (in thousands) Year Ended September 30, Ref 2019 2018 Unrecognized expense for DLH employees (a) $ 631 $ 876 Ref (a): Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance. For options that vest based on the Company’s common stock achieving and maintaining defined market prices, the Company values the awards with a Monte Carlo binomial model that utilizes various probability factors and other criterion in establishing fair value of the grant. The related compensation expense is recognized over the derived service period determined in the valuation. On a weighted average basis, this expense is expected to be recognized within the next 4.14 years .
Schedule of Stock Option Activity	This amount will change based on the fair market value of the Company’s stock. (in years) Weighted Weighted Average (in thousands) (in thousands) Average Remaining Aggregate Number of Exercise Contractual Intrinsic Ref Shares Price Term Value Options outstanding, September 30, 2018 2,134 $4.31 6.3 $ 6,949 Granted (a) 35 $5.25 Exercised or canceled (35 ) $1.12 Options outstanding, September 30, 2019 2,134 $4.36 5.9 $ 4,815
Schedule of Stock Option Shares Outstanding, Vested and Expected to Vest	Stock options shares outstanding, vested and unvested for the period ended: (in thousands) Number of Shares September 30, Ref 2019 2018 Vested and exercisable (a) 1,300 1,335 Unvested (b) 834 799 Options outstanding 2,134 2,134 Ref (a): Weighted average exercise price of vested and exercisable shares was $1.51 and $1.50 at September 30, 2019 and 2018, respectively. Aggregate intrinsic value was approximately $3.9 million and $5.7 million at September 30, 2019 and 2018, respectively. Weighted average contractual term remaining was 3.8 years years and 4.5 years at September 30, 2019 and 2018, respectively. Ref (b): Certain awards vest upon satisfaction of certain performance criteria.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	12 Months Ended
	Sep. 30, 2019
Earnings Per Share [Abstract]
Schedule of Diluted Earnings Per Share	Diluted earnings per share is calculated using the treasury stock method. (in thousands) Year Ended September 30, 2019 2018 Numerator: Net income $ 5,324 $ 1,836 Denominator: Denominator for basic net income per share - weighted-average outstanding shares 12,018 11,881 Effect of dilutive securities: Stock options and restricted stock 1,023 992 Denominator for diluted net income per share - weighted-average outstanding shares 13,041 12,873 Net income per share - basic $ 0.44 $ 0.15 Net income per share - diluted $ 0.41 $ 0.14

Commitments and Contingencies (

Commitments and Contingencies (Tables)	12 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Schedule of Contractual Obligations	Contractual Obligations as of September 30, 2019 : Payments Due By Period Contractual obligations Next 12 2-3 4-5 More than 5 (Amounts in thousands) Total Months Years Years Years Debt obligations $ 56,000 $ — $ 5,250 $ 50,750 $ — Facility leases 32,731 3,423 6,135 6,228 16,945 Equipment operating leases 151 61 52 38 — Total Contractual Obligations $ 88,882 $ 3,484 $ 11,437 $ 57,016 $ 16,945

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Sep. 30, 2019
Income Tax Disclosure [Abstract]
Schedule of Deferred Tax Assets and Liabilities	An analysis of the Company's deferred tax assets and liabilities is as follows: Year Ended September 30, (amounts in thousands) 2019 2018 Deferred income tax assets: Net operating loss carry forwards $ 3,926 $ 5,005 AMT credit carryforward 183 185 Stock based compensation 140 140 Accrued expenses 1,666 1,202 Other items, net 45 45 Total deferred tax asset 5,960 6,577 Deferred tax liability: Equipment and intangible assets (3,615 ) (2,440 ) Net deferred tax asset $ 2,345 $ 4,137
Schedule of Significant Components of the Expense From Continuing Operations	The significant components of income tax expense for income taxes from continuing operations are summarized as follows: Year Ended September 30, (amounts in thousands) 2019 2018 Current expense $ 379 $ 328 Deferred expense 1,792 5,502 Total expense $ 2,171 $ 5,830
Schedule of Significant Differences Between the Income Taxes at Federal Statutory Rate and Effective Tax Rate	The following table indicates the significant differences between our income taxes at the federal statutory rate and the Company's effective tax rate for continuing operations: Year Ended September 30, (amounts in thousands) Ref 2019 2018 Federal statutory rate $ 1,574 $ 1,861 State taxes, net 407 393 Other permanent items 91 77 Deferred tax estimate adjustment 99 134 Discrete item (a) — 3,365 Total $ 2,171 $ 5,830 (a): Write-down of deferred tax assets due to change in federal income tax rate from the 2017 Tax Act.

Quarterly Financial Data (Una_2

Quarterly Financial Data (Unaudited) (Tables)	12 Months Ended
	Sep. 30, 2019
Quarterly Financial Information Disclosure [Abstract]
Schedule of Quarterly Financial Information	A summary of quarterly information is as follows (in thousands, except per share data) 2019 Quarters Ref First Second Third Fourth Revenue (a) $ 33,752 $ 33,756 $ 38,700 $ 54,183 Income from operations 2,557 2,327 1,690 3,394 Interest expense, net (177 ) (545 ) (562 ) (1,190 ) Income before income taxes 2,380 $ 1,782 1,128 2,204 Income tax expense 690 $ 517 325 639 Net income $ 1,690 $ 1,265 $ 803 $ 1,565 Earnings per share: Basic $ 0.14 $ 0.11 $ 0.07 $ 0.13 Diluted $ 0.13 $ 0.10 $ 0.06 $ 0.12 2018 Quarters Ref First Second Third Fourth Revenue $ 30,215 $ 34,401 $ 36,131 $ 32,489 Income from operations 1,146 2,204 2,614 2,819 Interest expense, net (278 ) (261 ) (262 ) (315 ) Income before income taxes 868 1,943 2,352 2,504 Income tax expense (b) 3,719 627 738 747 Net income (loss) $ (2,851 ) $ 1,316 $ 1,614 $ 1,757 Earnings (loss) per share: Basic $ (0.24 ) $ 0.11 $ 0.14 $ 0.15 Diluted $ (0.24 ) $ 0.10 $ 0.13 $ 0.14 _______________________________________________________________________________ Ref (a): The third and fourth quarters of fiscal 2019 include the results of operations of S3. Ref (b): Refer to Note 12, Income Taxes , for a detailed explanation of the $3.4 million income tax discrete charge in fiscal year 2018, related to the 2017 Tax Cut and Jobs Act.

Business Combinations (Tables)

Business Combinations (Tables)	12 Months Ended
	Sep. 30, 2019
Business Combinations [Abstract]
Schedule of Total Acquisition Consideration and Allocation of Fair Value of Assets and Liabilities	The purchase price and its allocation are shown below. Based on the unaudited financial statements of S3 on June 7, 2019, we accounted for the total acquisition consideration and allocation of fair value to the related assets and liabilities as follows: (Amounts in thousands) Final purchase price for S3 $ 70,115 Net assets acquired Cash and cash equivalents $ 3,037 Accounts receivable 13,038 Other current assets 1,418 Total current assets 17,493 Accounts payable and accrued expenses (4,488 ) Payroll liabilities (3,624 ) Long term liabilities (1,206 ) Net working capital 8,175 Equipment and improvements, net 4,605 Net identifiable assets acquired 12,780 Goodwill 26,769 Customer contracts and related customer relationships 28,974 Trade name 1,592 Intangible assets acquired 57,335 Net assets acquired $ 70,115
Schedule of Pro Forma Results (unaudited)	(unaudited) (in thousands) Year ended September 30, Pro forma results Ref 2019 2018 Revenue $ 204,043 $ 203,287 Net income (loss) (a) 2,044 (1,456 ) Number of shares outstanding - basic 12,018 11,881 Number of shares outstanding - diluted 13,041 12,873 Basic earnings per share (loss) $ 0.17 $ (0.12 ) Diluted earnings per share (loss) $ 0.16 $ (0.11 ) Ref (a): Fiscal 2018 results include the impact of writing down the deferred tax asset by $3.4 million . The write down is further described in Note 12 - Income Taxes .

Business Overview (Details)

Business Overview (Details)	12 Months Ended
	Sep. 30, 2019employeebusiness_arealocation	Sep. 30, 2018
Concentration Risk [Line Items]
Number of market focus areas | business_area	3
Number of market core competencies | business_area	7
Number of employees (over) | employee	1,900
Customer Concentration | Revenue Concentration | Federal Government
Concentration Risk [Line Items]
Concentration risk percentage	99.00%
Customer Concentration | Revenue Concentration | VA
Concentration Risk [Line Items]
Concentration risk percentage	57.00%	63.00%
Customer Concentration | Revenue Concentration | HHS
Concentration Risk [Line Items]
Concentration risk percentage	39.00%	34.00%
United States
Concentration Risk [Line Items]
Number of locations in which the entity operates (more than) | location	30
Overseas
Concentration Risk [Line Items]
Number of locations in which the entity operates (more than) | location	1

New Accounting Pronouncements (

New Accounting Pronouncements (Details) $ in Millions	Sep. 30, 2019USD ($)
Accounting Changes and Error Corrections [Abstract]
Impact in balance sheet net assets and liabilities resulting from the adoption of lease obligations	$ 32.7

Revenue Recognition - Narrative

Revenue Recognition - Narrative (Details) - USD ($) $ in Thousands	4 Months Ended	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2019	Oct. 01, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Contract assets payment terms		30 days
S3
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase in contract assets from acquisition	$ 3,100
Increase in contract liabilities from acquisition	$ 100
ASC 606
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of adoption of new accounting pronouncement in opening balance sheet (less than)			$ 10

Supporting Financial Informat_3

Supporting Financial Information - Accounts Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Billed receivables	$ 18,924	$ 10,066
Contract assets	4,302	214
Total accounts receivable	23,226	10,280
Less: Allowance for doubtful accounts	0	0
Accounts receivable, net	$ 23,226	$ 10,280

Revenue Recognition - Contract

Revenue Recognition - Contract Balances (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Revenue from Contract with Customer [Abstract]
Contract assets	$ 4,302	$ 214
Contract liabilities	$ 92	$ 0

Supporting Financial Informat_4

Supporting Financial Information - Other Current Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Prepaid insurance and benefits	$ 495	$ 401
Other receivables	301	319
Prepaid expenses	1,035	40
Other current assets	$ 1,831	$ 760

Revenue Recognition - Disaggreg

Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Total revenue	$ 54,183	$ 38,700	$ 33,756	$ 33,752	$ 32,489	$ 36,131	$ 34,401	$ 30,215	$ 160,391	$ 133,236
Prime
Disaggregation of Revenue [Line Items]
Total revenue									154,207
Subcontractor
Disaggregation of Revenue [Line Items]
Total revenue									6,184
Time and materials
Disaggregation of Revenue [Line Items]
Total revenue									134,136
Cost reimbursable
Disaggregation of Revenue [Line Items]
Total revenue									23,200
Firm fixed price
Disaggregation of Revenue [Line Items]
Total revenue									3,055
Department of Veterans Affairs
Disaggregation of Revenue [Line Items]
Total revenue									91,949
Department of Health and Human Services
Disaggregation of Revenue [Line Items]
Total revenue									62,000
Other
Disaggregation of Revenue [Line Items]
Total revenue									$ 6,442

Supporting Financial Informat_5

Supporting Financial Information - Equipment and Improvements, net (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Property, Plant and Equipment [Line Items]
Furniture and equipment	$ 1,262	$ 326
Computer equipment	1,043	751
Computer software	3,985	1,731
Leasehold improvements	1,595	66
Total equipment and improvements	7,885	2,874
Less accumulated depreciation and amortization	(2,542)	(1,308)
Equipment and improvements, net	5,343	1,566
Depreciation	$ 1,200	$ 500
Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of property and equipment	3 years
Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of property and equipment	7 years

Supporting Financial Informat_6

Supporting Financial Information - Intangible Assets, Net (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 48,189	$ 17,623
Less accumulated amortization	(6,981)	(4,258)
Intangible assets, net	$ 41,208	13,365
Finite-lived intangibles estimated useful lives	10 years
Amortization expense of intangibles	$ 2,700	1,800
Customer contracts and related customer relationships
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	45,600	16,626
Less accumulated amortization	(6,590)	(4,018)
Covenants not to compete
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	480	480
Less accumulated amortization	(164)	(116)
Trade name
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	2,109	517
Less accumulated amortization	$ (227)	$ (124)

Supporting Financial Informat_7

Supporting Financial Information - Estimated Amortization Expense of Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Fiscal 2020	$ 4,723
Fiscal 2021	4,723
Fiscal 2022	4,723
Fiscal 2023	4,723
Thereafter	22,316
Intangible assets, net	$ 41,208	$ 13,365

Supporting Financial Informat_8

Supporting Financial Information - Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Goodwill [Roll Forward]
Beginning balance	$ 25,989	$ 25,989
Increase from acquisition	26,769	0
Ending balance	$ 52,758	$ 25,989

Supporting Financial Informat_9

Supporting Financial Information - Accounts Payable, Accrued Expense and Other Current Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounts payable	$ 10,054	$ 3,393
Accrued benefits	2,252	2,060
Accrued bonus and incentive compensation	1,951	2,191
Accrued workers' compensation insurance	4,007	2,642
Other accrued expenses	2,369	664
Accounts payable, accrued expenses, and other current liabilities	$ 20,633	$ 10,950

Supporting Financial Informa_10

Supporting Financial Information - Debt Obligations (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Debt Instrument [Line Items]
Net bank debt obligation	$ 56,000
Secured Debt
Debt Instrument [Line Items]
Bank term loan	56,000	$ 7,708
Less unamortized deferred financing cost	(2,371)	(750)
Net bank debt obligation	53,629	6,958
Less current portion of bank debt obligations	0	0
Long term portion of bank debt obligation	$ 53,629	$ 6,958

Supporting Financial Informa_11

Supporting Financial Information - Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Interest expense									$ (1,512)	$ (800)
Amortization of deferred financing costs									(982)	(275)
Other income (expense), net									21	(41)
Interest expense, net	$ (1,190)	$ (562)	$ (545)	$ (177)	$ (315)	$ (262)	$ (261)	$ (278)	$ (2,473)	$ (1,116)

Cash and Credit Facilities - Su

Cash and Credit Facilities - Summary of Loan Facilities and Subordinated Debt Financing (Details) - Secured Debt - USD ($)	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Debt Instrument [Line Items]
Total bank debt obligation	$ 56,000,000	$ 7,708,000
Term loan
Debt Instrument [Line Items]
Secured term loan, face amount	70,000,000
Total bank debt obligation	$ 56,000,000
Term loan | LIBOR
Debt Instrument [Line Items]
Debt instrument, interest rate, effective percentage	2.10%
Debt instrument, basis spread on variable rate	4.00%
Revolving Line of Credit
Debt Instrument [Line Items]
Secured revolving line of credit, ceiling	$ 25,000,000
Total bank debt obligation	$ 0
Revolving Line of Credit | LIBOR
Debt Instrument [Line Items]
Debt instrument, interest rate, effective percentage	2.10%
Debt instrument, basis spread on variable rate	4.00%

Cash and Credit Facilities - Na

Cash and Credit Facilities - Narrative (Details)	12 Months Ended
	Sep. 30, 2019USD ($)
Interest Rate Swap
Line of Credit Facility [Line Items]
Notional amount of floating-to-fix interest rate swap	$ 36,000,000
Secured Debt | Term loan
Line of Credit Facility [Line Items]
Secured term loan, face amount	70,000,000
Voluntary prepayment of line of credit	$ 12,700,000
Fixed charge coverage ratio	1.25
Ratio of debt to EBITDA	3.25
Secured Debt | Term loan | Maximum
Line of Credit Facility [Line Items]
Ratio of debt to EBITDA	4.25
Secured Debt | Term loan | Excess Cash Flow Greater Than or Equal to 2.50
Line of Credit Facility [Line Items]
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA	75.00%
Ratio of funded indebtedness to adjusted EBIDTA	2.50
Secured Debt | Term loan | Excess Cash Flow Less Than 2.50 But Greater Than or Equal to 1.50
Line of Credit Facility [Line Items]
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA	50.00%
Secured Debt | Term loan | Excess Cash Flow Less Than 2.50 But Greater Than or Equal to 1.50 | Maximum
Line of Credit Facility [Line Items]
Ratio of funded indebtedness to adjusted EBIDTA	2.50
Secured Debt | Term loan | Excess Cash Flow Equal to 1.50
Line of Credit Facility [Line Items]
Ratio of funded indebtedness to adjusted EBIDTA	1.5
Secured Debt | Term loan | Excess Cash Flow Less Than 1.50
Line of Credit Facility [Line Items]
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA	0.00%
Ratio of funded indebtedness to adjusted EBIDTA	1.5
Secured Debt | Term loan | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, interest rate, effective percentage	2.10%
Secured Debt | Term loan | LIBOR | Maximum
Line of Credit Facility [Line Items]
Debt instrument, interest rate, effective percentage	4.50%
Secured Debt | Term loan | LIBOR | Minimum
Line of Credit Facility [Line Items]
Debt instrument, interest rate, effective percentage	2.50%
Secured Debt | Revolving Line of Credit
Line of Credit Facility [Line Items]
Line of credit ceiling	$ 25,000,000
Remaining borrowing availability	16,300,000
Unused borrowing capacity	$ 16,300,000
Secured Debt | Revolving Line of Credit | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, interest rate, effective percentage	2.10%
Secured Debt | Letters of Credit
Line of Credit Facility [Line Items]
Remaining borrowing availability	$ 3,000,000

Significant Accounting Polici_3

Significant Accounting Policies (Details) - USD ($)	4 Months Ended	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2019	Sep. 30, 2018	Jun. 07, 2019	Sep. 30, 2017
Goodwill [Line Items]
Amortization of acquired identifiable intangible assets		$ 2,700,000	$ 1,800,000
Goodwill	$ 52,758,000	52,758,000	25,989,000		$ 25,989,000
Goodwill impairment loss		0	0
Uncertain tax positions	0	0	0
Tax interest		0	0
Tax penalties		0	$ 0
FDIC insurance limit amount	$ 250,000	$ 250,000
Employee Stock Option
Goodwill [Line Items]
Number of options that may be granted with a term of more than 10 years from date of grant (in shares)	0	0
Expiration term of options		10 years
Minimum
Goodwill [Line Items]
Estimated useful lives of property and equipment		3 years
Maximum
Goodwill [Line Items]
Estimated useful lives of property and equipment		7 years
S3
Goodwill [Line Items]
Amortization of acquired identifiable intangible assets	$ 1,000,000
Goodwill				$ 26,769,000

Stock-based Compensation and _3

Stock-based Compensation and Equity Grants - Narrative (Details) - Employee Stock Option	12 Months Ended
	Sep. 30, 2019shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options that may be granted with a term of more than 10 years from date of grant (in shares)	0
Expiration term of options	10 years
2016 Omnibus Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options that may be granted with a term of more than 10 years from date of grant (in shares)	0
Expiration term of options	10 years
Number of shares available for grant (in shares)	1,500,000

Stock-based Compensation and _4

Stock-based Compensation and Equity Grants - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	Nov. 09, 2018	Dec. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Weighted average period for recognition of compensation expense			4 years 1 month 21 days
Selling, General and Administrative Expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total compensation expense			$ 790	$ 1,375
Unrecognized expense for DLH employees			631	876
DLH employees | Selling, General and Administrative Expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total compensation expense			263	266
Non-employee directors | Restricted Stock Units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of restricted stock units issued (in shares)		90,000
Non-employee directors | Common Stock
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of common stock issued (in shares)	101,667
Non-employee directors | Selling, General and Administrative Expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total compensation expense			$ 527	$ 1,109

Stock-based Compensation and _5

Stock-based Compensation and Equity Grants - Stock Options Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Number of Shares
Outstanding at beginning of period (in shares)	2,134
Granted (in shares)	35
Exercised or canceled (in shares)	(35)
Outstanding at end of period (in shares)	2,134	2,134
Weighted Average Exercise Price
Outstanding at beginning of period (in dollars per share)	$ 4.31
Granted (in dollars per share)	5.25
Exercised or canceled (in dollars per share)	1.12
Outstanding at end of period (in dollars per share)	$ 4.36	$ 4.31
Weighted Average Remaining Contractual Term
Options outstanding at the of period (in years)	5 years 10 months 25 days	6 years 3 months 18 days
Aggregate Intrinsic Value
Options outstanding at the end of period	$ 4,815	$ 6,949
Weighted average value of shares granted (in dollars per share)	$ 3.82

Stock-based Compensation and _6

Stock-based Compensation and Equity Grants - Stock Options Outstanding, Vested and Unvested (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Vested and exercisable (in shares)	1,300	1,335
Unvested (in shares)	834	799
Options outstanding (in shares)	2,134	2,134
Weighted average exercise price of vested and exercisable shares (in dollars per share)	$ 1.51	$ 1.50
Aggregate intrinsic value of vested and exercisable shares	$ 3.9	$ 5.7
Weighted average contractual term remaining of vested and exercisable shares	3 years 9 months 18 days	4 years 6 months 12 days

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Numerator:
Net income	$ 1,565	$ 803	$ 1,265	$ 1,690	$ 1,757	$ 1,614	$ 1,316	$ (2,851)	$ 5,324	$ 1,836
Denominator:
Denominator for basic net income per share - weighted-average outstanding shares (in shares)									12,018	11,881
Effect of dilutive securities:
Stock options and restricted stock (in shares)									1,023	992
Denominator for diluted net income per share - weighted-average outstanding shares (in shares)									13,041	12,873
Net income per share - basic (in dollars per share)	$ 0.13	$ 0.07	$ 0.11	$ 0.14	$ 0.15	$ 0.14	$ 0.11	$ (0.24)	$ 0.44	$ 0.15
Net income per share - diluted (in dollars per share)	$ 0.12	$ 0.06	$ 0.10	$ 0.13	$ 0.14	$ 0.13	$ 0.10	$ (0.24)	$ 0.41	$ 0.14

Commitments and Contingencies -

Commitments and Contingencies - Contractual Obligations (Details) $ in Thousands	Sep. 30, 2019USD ($)
Maturity of Debt Obligations
Net bank debt obligation	$ 56,000
Next 12 Months	0
2-3 Years	5,250
4-5 Years	50,750
More than 5 Years	0
Maturity Total Contractual Obligations
Total Contractual Obligations	88,882
Next 12 Months	3,484
2-3 Years	11,437
4-5 Years	57,016
More than 5 Years	16,945
Facility leases
Maturity Operating Leases
Total Lease Obligations	32,731
Next 12 Months	3,423
2-3 Years	6,135
4-5 Years	6,228
More than 5 Years	16,945
Equipment operating leases
Maturity Operating Leases
Total Lease Obligations	151
Next 12 Months	61
2-3 Years	52
4-5 Years	38
More than 5 Years	$ 0

Commitments and Contingencies_2

Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2019	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Workers' compensation liability	$ 4	$ 2.6

Income Taxes - Narrative (Detai

Income Taxes - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017
Income Tax Examination [Line Items]
Effective income tax rate									29.00%	32.20%	39.10%
Write-down of deferred tax assets from revaluation of net operating losses due to change in federal tax rate								$ 3,400		$ 3,400
Income tax expense	$ 639	$ 325	$ 517	$ 690	$ 747	$ 738	$ 627	$ 3,719	$ 2,171	5,830
ATM credits receivable	366								366
Federal
Income Tax Examination [Line Items]
Income tax expense associated with current operations										2,400
Net operating losses	$ 17,200				$ 23,800				17,200	$ 23,800
Net operating losses utilized to offset taxes otherwise currently due									$ 7,200

Income Taxes - Deferred Tax Ass

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Sep. 30, 2018
Deferred income tax assets:
Net operating loss carry forwards	$ 3,926	$ 5,005
AMT credit carryforward	183	185
Stock based compensation	140	140
Accrued expenses	1,666	1,202
Other items, net	45	45
Total deferred tax asset	5,960	6,577
Deferred tax liability:
Equipment and intangible assets	(3,615)	(2,440)
Net deferred tax asset	$ 2,345	$ 4,137

Income Taxes - Components of In

Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Current expense									$ 379	$ 328
Deferred expense									1,792	5,502
Total expense	$ 639	$ 325	$ 517	$ 690	$ 747	$ 738	$ 627	$ 3,719	$ 2,171	$ 5,830

Income Taxes - Effective Tax Ra

Income Taxes - Effective Tax Rate Reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Federal statutory rate									$ 1,574	$ 1,861
State taxes, net									407	393
Other permanent items									91	77
Deferred tax estimate adjustment									99	134
Discrete item									0	3,365
Total expense	$ 639	$ 325	$ 517	$ 690	$ 747	$ 738	$ 627	$ 3,719	$ 2,171	$ 5,830

Quarterly Financial Data (Una_3

Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Quarterly Financial Information Disclosure [Abstract]
Revenue	$ 54,183	$ 38,700	$ 33,756	$ 33,752	$ 32,489	$ 36,131	$ 34,401	$ 30,215	$ 160,391	$ 133,236
Income from operations	3,394	1,690	2,327	2,557	2,819	2,614	2,204	1,146	9,968	8,782
Interest expense, net	(1,190)	(562)	(545)	(177)	(315)	(262)	(261)	(278)	(2,473)	(1,116)
Income before income taxes	2,204	1,128	1,782	2,380	2,504	2,352	1,943	868	7,495	7,666
Income tax expense	639	325	517	690	747	738	627	3,719	2,171	5,830
Net income	$ 1,565	$ 803	$ 1,265	$ 1,690	$ 1,757	$ 1,614	$ 1,316	$ (2,851)	$ 5,324	$ 1,836
Basic (in dollars per share)	$ 0.13	$ 0.07	$ 0.11	$ 0.14	$ 0.15	$ 0.14	$ 0.11	$ (0.24)	$ 0.44	$ 0.15
Diluted (in dollars per share)	$ 0.12	$ 0.06	$ 0.10	$ 0.13	$ 0.14	$ 0.13	$ 0.10	$ (0.24)	$ 0.41	$ 0.14
Write-down of deferred tax assets from revaluation of net operating losses due to change in federal tax rate								$ 3,400		$ 3,400

Employee Benefit Plans (Details

Employee Benefit Plans (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Retirement Benefits [Abstract]
Defined contribution plan, recorded expense	$ 577	$ 222
Defined contribution plan, matching contributions period	4 years

Business Combinations - Narrati

Business Combinations - Narrative (Details) - USD ($)	Jun. 07, 2019	Sep. 30, 2019
Term loan | Secured Debt
Business Acquisition [Line Items]
Borrowings		$ 70,000,000
S3
Business Acquisition [Line Items]
Percentage of equity interest acquired	100.00%
Net purchase price	$ 67,100,000
Consideration paid	70,115,000
Cash on hand acquired	3,000,000
Transaction expenses and financing costs	4,900,000
Escrow funds	1,200,000
Revenue contributed since the acquisition date		24,300,000
Income from operations contributed since the acquisition date		$ 1,300,000
Tax deductible goodwill	26,800,000
S3 | Term loan | Secured Debt
Business Acquisition [Line Items]
Borrowings	$ 70,000,000

Business Combinations - Total A

Business Combinations - Total Acquisition Consideration and Fair Value of Net Assets Acquired (Details) - USD ($) $ in Thousands	Jun. 07, 2019	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017
Net assets acquired
Goodwill		$ 52,758	$ 25,989	$ 25,989
S3
Business Acquisition [Line Items]
Final purchase price for S3	$ 70,115
Net assets acquired
Cash and cash equivalents	3,037
Accounts receivable	13,038
Other current assets	1,418
Total current assets	17,493
Accounts payable and accrued expenses	(4,488)
Payroll liabilities	(3,624)
Long term liabilities	(1,206)
Net working capital	8,175
Equipment and improvements, net	4,605
Net identifiable assets acquired	12,780
Goodwill	26,769
Intangible assets acquired	57,335
Net assets acquired	70,115
S3 | Customer contracts and related customer relationships
Net assets acquired
Intangible assets acquired	28,974
S3 | Trade name
Net assets acquired
Intangible assets acquired	$ 1,592

Business Combinations - Pro For

Business Combinations - Pro Forma Results (unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Sep. 30, 2019	Sep. 30, 2018
Business Acquisition [Line Items]
Write-down of deferred tax assets from revaluation of net operating losses due to change in federal tax rate	$ 3,400		$ 3,400
S3
Business Acquisition [Line Items]
Revenue		$ 204,043	203,287
Net income (loss)		$ 2,044	$ (1,456)
Number of shares outstanding - basic (in shares)		12,018	11,881
Number of shares outstanding - diluted (in shares)		13,041	12,873
Basic earnings per share (loss) (in dollars per share)		$ 0.17	$ (0.12)
Diluted earnings per share (loss) (in dollars per share)		$ 0.16	$ (0.11)
Write-down of deferred tax assets from revaluation of net operating losses due to change in federal tax rate			$ 3,400

Uncategorized Items - dlhc-2019

Label	Element	Value
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 306,000
Additional Paid-in Capital [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	177,000
Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 129,000