CACI - Earnings call transcript Q4 2018

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the CACI International Q4 and Year End FY '18 Earnings Conference Call. Today's call is being recorded. At this time, all lines are in a listen-only mode. Later we will announce the opportunity for questions and instructions will be given at that time. time, Dave like of Dragics, for International. this conference turn Investor At CACI to over Senior Instructions] I to would the Relations [Operator Vice President Please ahead, sir. go

Dave Dragics

Dave presentation Relations of practice, as International morning, and good able and that very is slides. we CACI Vice us to Allison, Investor gentlemen. our participate and Thanks, with I'm of President Dragics, pleased ladies providing you're we're are Senior And today.

So to let's Slide move X. number

there measures evening's is this earnings filings. Harbor any as of in of Safe the also of that in today constitute results. And our I'd subject performance like written measures to could will that at our factors exhibit that our point accordance These out measures and our will Exchange cause non-GAAP Now to materially results actual under cause include with as and views results and this statement described Securities part and not company's historical are to and to of those commentary, of on should current our statements be oral considered prepared Commission this bottom call be transcript about and important incorporated listed that from are do are fact Factors call. presentation included release we disclosures in a anticipate also differ could actual in and forward-looking for and law. address not reflect as today substitute anticipated discussion last be financial GAAP. from should non-GAAP as these the statements such, isolation our or differ statements materially

Ken and Slide our now to President and turn Asbury. CEO, here's let's X, Ken? So

Ken Asbury

President of quarter joining to are full and everyone. Tom Mengucci, and from John morning the year U.S. joining is and CACI Gray, the Dave, us us Officer; year fourth President Chief Limited, Financial XXXX good the for you, Mutryn, Operations; thank discuss Operating With Greg results. Chief this our of Bradford, our Well, me fiscal to you who our our Thank U.K. Officer; DeEtte morning

into U.S. made I along jump are Dunne the Defense's incredibly valor earlier have news or CACI who us we the who Before and of to Ray awarded our they Military of about of all honor week want for Secretary two share professionals operations. Tony this proud, their had for Seabolt, pass meat remarkable in medal heroic supporting some being call, actions the

to the to America's on General We highest prouder won And night the of from of a I the of Hall can are Heroes for year to evening, we XX/XX/XXXX. you attending to award XXXX, going their and of Please Dynamics the awards Gray, shoulder given of last the Navy net this than most the a to our tell medals quarter Yes very fiscal at income actions ceremonies we acquisition so, who earnings throughout more shoulder. reminder them have Tuesday. Ray had outstanding of the fiscal aware by operations Defense year. We instituted that And and totaling those call. as and technical first for recipients I'm and are revenue Mengucci, business. of Pentagon John there and been late on since medal have income civilian acquisition who and medal, billion Department For honor were is contract XXXX. XXXX. issue. turn we to Last the on had operating medal I result the earnings. we the looks net fiscal the of billion valor year $X.X this released Engineering XX for of guidance earnings, full also the – not DeEtte We of now Slide it during of delivered year. [Technical work dedication Tom delivered and earnings quarter you Systems national I $X.X Therefore our at men and record missions. last personally bravery women with turning professionals cannot fiscal X, revenue, stirring was we the and released Tony security we on be in full recorded… our for turn details our critical income, a Military our a year night quarter more for and raising fourth cash closed fourth few just Difficulty]

EBITDA expanded we to commitment. also XX XX our fiscal basis the points During margin well beyond year,

fixed winning While confirming to at there array contributed We are efficiency primarily type with this price contracts was by were significant a and that higher work which are of performing contracts our contributions we teams the operating delivering. contract. an few this, price our solution of one-time and more to saw driven from pursue fixed the items strategy

X to Slide turn Let's please.

accelerate are of and margin important are course business, While research we partnerships, our people, M&A investing expanding of as and to growth. also such other we areas in development,

are and business relationships with we other we and meaningful enhancing their solutions and spectrum. electromagnetic include XXX our to artificial learning, best investments makes to to an key workforce business with processing government R&D are can offer customers and also talent ensure such in innovative and of we technologies people tailored of and signal flexibility in Partnerships long-term regard providers do technology side, within to commercial aspect the benefits needs. the important investing match we the process digital our solution attract our automation, robotic our were the that retain machine (k) On decreased efforts, so successful. intelligence, as type a And

deployment. And M&A our priority lastly, remains a for turn Let's X Slide capital to please.

appropriate quality We companies returns. add very our in are solid capability gaps customers pursuing that and contracts and provide markets, fill and then addressable financial

the added under and a end evening, we subsidiaries; as we fill an that year that providing to Domestically very performance information Systems fiscal cyber two intelligence enterprise and mentioned provide companies earlier, purchased community software This is Dynamics. system we General geographic purchased software, I business UK an also important late contract every high company During engineering. XXXX IT and on our classified solutions new consulting, technology Engineering Navy of opportunities. past transaction M&A future is the platform our leading in acquisition strategy. added It customer to and attractive. into element we vital will the provider the yesterday national And met CACI lifecycle talented your our family. added new closed like to of gaps, an very of avenue cultural information XXXX our and shipbuilding multi-decade and look it to forward people these effort and and to long-term combined added we're the fantastic a gives support interests. of I'd nearly operations new and engineering And the This new programs. are welcome all capability role customers, continued naval organization performance I match is today the CACI This premier CACI is a navy for financials fleet. employees nation's It revitalization success. almost the to to our

war reflect we also Let's the us award much Slide and X please. homeland a line intelligence, see well for just Defense Overall, very across flow $XXX 'XX National well also of Act progress quarter. and a has Government in all The security current to Authorization and priorities capabilities several very awards with Fiscal as to Year continued saw passed government's prospects. Bills strong September June go systems positions and I'm Department as capabilities quarter during fighting, long-term markets. and commitment infrastructure. the investing Appropriations strong the our modernized to week billion in encouraged during they've CACI's expect Congress our by XX Defense. lot made passing are this We the of These

about other to Bills This hearing FY over bodes Tom. for well. very are good call I'm to as We 'XX. turn progress lot a positive to a of Tom? start that, With the Appropriations going on things

Tom Mutryn

to Ken you, and number X. Please everyone. morning thank good turn Yes, Slide

primarily offset tax quarter the revenue growth. lower fourth income X.X% was with strong organic driven XX% X.X% billion, by up billion, Pretax year partially by up program indirect with X.X% million, Our for organic X.X% year was income X.X% performance greater Net up than costs. rates. Full $XX.X last with was $X.X quarter revenue growth. was $X.X

several call, during indirect efficiencies net year. to generated million last been margin for one-time year. year margin year. Center was Operating the major at positive Full acquisition Shared partially XXX% margin implementation points XX% spoke driven quarter X.X% operating offset at net full of associated after cash continued with XX the implementation direct during driver Adjusting the which last Please and third basis was These tax around contract benefits $XX we million controls up last quarter year. strong basis results XX of on performance the price would X% the expense, third about focus Firm been closed impact X.X% in were EBITDA EBITDA greater XX% this last or points year X% above of cost services income indirect income fixed were net have the of cost last Adjusting days. about labor, for of XX% last million, for from impact of costs more turn year to reform, flow XX $XXX reforms. compared fringe Slide have number from tax indirect Full our were than would than and of up by higher program by to bonus down items, costs XX, flow Excluding the up Services year income and we DSO cash pursuits. were year for over shared was adjusting with performance, on expansion. and net costs, year. $XXX non-recurring

we fiscal since At time the Engineering including by million. million Systems our $XXX mentioned, million about acquisitions reduced Navy of purchase capital As closed strategic XXXX several of the $XXX of same deploying the Ken we $XX business. on debt start our year

EBITDA performance. most revenue X.X, accounting realized, amount they July June a on to when ASC Our for us of adopted change will X.X for proportional is is Instead the of days. periods recognize during treatment standard times net months new significant recognizing are we XX. XX. The as trailing debt the work them XX A the at of recognition

middle results how In is the our reform effective comparison standard, each 'XX much in will complicated FY the FY by of financial was 'XX fiscal by of since addition XXXX. tax Slide to please. This occurred XX disclose the affected year date new the into legislation this we new statement year to item reporting line our standard.

Assuming we rate in for assumes earnings. place our the deferred foreign of for cumulative tax million. would tax our year, fiscal was of evaluation out tax liability tax estimate we and year had and the net have the adjust been income all This $XXX to the new reform estimate in full XXXX

had our 'XX. 'XX at X% organic apples-to-apples comparison please. with table help numbers are in FY margin guidance release We June a FY issued earnings which EBITDA to we expansion. with to XX, the growth associated midpoint revenue providing on the with Slide

are to We that acquisition Systems the Engineering increasing guidance incorporate the business. Navy of

of With at and expect the X.X% the year add between million guidance. million We the partial income. $X.X billion will growth net of we of it $X of and revenue now billion expect contribution revenue of or midpoint $XXX $X.X

of expect and between $XXX We net income $XXX million. million

also to at We our the are account to cash XX flow for expectations $XXX be operating acquisition. increasing Slide least million please.

as margins this in CACI The Additional are to base are business. be expected details with acquisition with line EBITDA associated the incremental follows.

the over business additional little expenses. overhead G&A are bringing with or We very

we about of will are interest $X it operational and let and one-time depreciation amortization With John still I'll I'll million expenses. provide transaction finalizing to highlights. $X.X around we amortization turn incur expect of million. Incremental expect additional related to that, expense. the million know around value $X intangible you to be We

John Mengucci

Thanks Tom.

type a efficiently operational the is arrangements. of and to is ability reflective firm in and ups the contract heavier organic fourth go ability team's winning with It very work fiscal culture please. to strong we're Slide growth, year with I'm pleased Revenue by new expansion Let's revenue fixed margin of existing contents expansion business Margin growth price and of deliver plus quarter driven CACI's was contract awards also full both solutions to programs. under and deliver wins result our excellence. team's XX of to our XXXX.

than Turning to business $X.X we billion the during CACI. to won about contact more of that with XX% awards, new quarter

that of For we approximately new the full won $X.X business. XX% year over billion with for

Two value our backlog well were, tool and areas cyber into integrate two million configurable and operation Mitigation and consolidation, total additional with a DHS This to advanced the CDM solution, enterprise across such cloud great Diagnostics awards and $XX.X at the $XXX award now stands initial Continuous quarter notable management. tools security engineer run with years win expand mobile to the revenue significant based at security the Our is processes center as potential during rates. ceiling billion contract resource department. solutions, a or fourth of current over architect, of

We Air electronic of emergency contract won value interruptible On for communications are advanced a systems ceiling Warfare for of develop a also communications technologies OCONUS development Center. this designs, million providing contract rapid $XXX with to we and response. the Naval CONUS and deployment

In other systems strong differentiates contract like and awards, IT markets. addition would CACI enterprise to three within to business I that notable accomplishments highlight our

CACI the First, in the Partner was partner named consulting Services Amazon premier Web Network.

business The markets. combination we in invested and please. achievements Agile's management confirms of earned And of which in the important the of these XX as benefits an new our key these we our new [indiscernible] Second, certification XX,XXX additional IT to service pursue advantage of to adds ISO Factory best software existing Slide international adheres customers Solution expansion taking third, practices. Agile development. accommodate CACI

noted past, end to we've offerings. invest capabilities to in continue differentiate we high the CACI's in As

which include both and suite of our fixed, domestically. mobile, OCONUS wearable Our SkyTracker products now variants, and deploying

will regular our situational protect and war are sensitive We course space based Resiliency July One opened. people of we EW month the award enemy systems are Federal particularly space team completed Operations web modern the capabilities. tagging Services assets into have will of Investments the center adversary awareness, high to action is and in for this half encouraged and we the sites by And domestic fighters London to management. J.P. in They the to fiscal detected. aerial continued in and XX provide support techniques the Government space U.S. protect Space field million example being solution assets as without during contract infrastructure. revolutionary ability this to this already XXXX automating deploy counter $XX are back is officially to And techniques Navy. more response the are even regulations with is we announced developing legislation customers savings Center deploying will generated a growth. to decision our to Dr. national to that and need security. The These significant invested electronic priority we making battle unmanned and progress center technical of space jam communications our warfare Under and recent help counter Slid radars. systems being developed solutions vital in advanced In Shared by delivery services of are automated company-wide for making. evolve the please. first of be advanced the changes

about opportunities year fiscal composition XX% existing business XX% strong at bids those pending remain pipeline at our to business. billion for of X% stands And Turning and submitted new recompetes, business, award forward indicators CACI. is $X.X of our with XXXX, with XX% healthy. to Revenue new

to with I'll call approximately over Ken. another submit With the the quarters, We those business. again new for expect that, to $XX.X billion XX% two turn next over of

Ken Asbury

appreciate you, morning. comments John your thank Well, this and Tom. I

our I'll expanding and I'm slide investing nicely. both In by to XX our employees long-term. near encouraged prospects, in growth while turn margins We're and So closing, please.

and with development on business contracts. focus engine price a Our continues fixed win to solution

admired long-term Our operations is shareholder is innovation, is at thank our proud and delivering one in seventh a IT Magazine talent direct significant incredibly to to focused talent, deploying M&A. caliber for do. we and profitability. you and growth say, remain of working organization CACI of was value. Bottom quality worldwide on fifth am services high We success. you employees. our that industry. for driving our It through I and cash time by to of world's strategy levels customers' like And Fortune as of line is that the how In with ranked This is and we commitment the CACI. capital most I'd result every drives enjoy generate the the their our company also accelerate each I missions XXXX what are and

the years when service the Dragics, the worth for Vice XXXX service at at XX President Senior highlight October. Investor want coming we're revenue our express of dedicated contribution. of milestone before is plans years to our I generating to north in traded of than This after many joined appreciation questions, Relations Now a retire we to this $X. company and significant later, $XXX I open had $X.X years traded billion and of million and CACI. Dave of for stock company's and less Dave XX approximately $XXX. of call revenue

a and During that all you on and proxy leadership. the at taught represents Relations financial the Board great several NIRI years Exchange last community participated are the of character, clarity. profession deal time, guided to Investor you've and in the efforts in York and front disclosure, and Relations on issuers competence everything Congress. me you LCAB Listed with you and both has transparency have Exchange. Institute corporate the buying New Dave CACI both Investor Security or government are and analysis. Dave on behavior, advocacy technologies, the impact and a significant with true Stock Advisory CACI. of through and changes in the Commission NIRI done. represent only With us Dave, Thank where also over David Dave's and governance in market, He know others, professional topics you for NYSE or company, our from Dave the other he roles unwavering access, countless contributions and CACI Company the had active I not many a investment serves presents in been as such National has others. leadership frequently

for up call some the open let's Allison, questions. that with Now

Operator

question Jon with Thank today ahead. Raviv come Please Citi. go Our from you, first Sir. will [Operator Instructions]

Jonathan Raviv

seems any On and your It go much the up know know also like historical much you tuck-ins words. things versus CD last open on I there you've small things small couple you side properties? how larger is as thinking Good lots and firms of year the larger echo are that sort and keeping to more with things? you bought Thank GD disclosed deal behavior, Dave. for I small Ken's a just also you everyone but in very M&A, business, is the I morning of both is well, about

Ken Asbury

Yes, Ken. is this Jon

identified of the adds there we know market point the that think to a our do go something has that it. where a where that strategies very going us want that what that's that we it. to and we at time while cyber modernization a point we we've a time. was doing was the be we're adds that find how to capability the execute spans that our a something look took support space, customer see is it's small, be interesting CSRA we creative I was to been at have to the making quite They to [ph] – going also probably if each because we - were our nearly a disciplined had notion whenever a of of to modern in IT that that to whether looking I in it gaps lens and our strategy evolved really no business in there was compelling. – done good and for about the medium, I us customer when back and a to we just we able government program get XX to not felt our think longer deal, puts in shot is – contract company hands it that one If it tell M&A the that longer markets ever a large through the place because gaps We we're do be it's some place it, this premise. represented accelerated But to of we cases we note companies solutions. about most this new no you on, then on small despite to contracting we will time CSRA wanted or we some and approach about withdraw where the waited market gamut, was made models point the sense and that some in at set regularly I sale, activities or financially at to fact in will But it buying be

recent maybe kinds you I we're and the think of recent we've see all history the - things been ones doing. added, the the of at history were if look very you'll the accretive of it's that that of everything's made to company, the throughout in in past

to So we strategies come our a daily market there's no discipline to rhyme than each the seeing one or seeing we that. that we reason bring that can other helps. of that on and - improve Hopefully at strategies basis looking and how

Jonathan Raviv

there up is that’s and like speak then And fill? that you gaps plainly needing Yes, would helpful. follow another that to suggests is there about CSRA out on the to gap identify topic, to the a since fact I capability pursue talked still a you you guess there so

Ken Asbury

mean, Yes, going be company so each I to different. is

customer our or of a lot modernization case systems, business electronic CSRA, to time time here vision, UAS acquired of shipbuilding abilities Systems a of and they in an our when you saw into when in portion that those give [ph] and as just for variety because their like. opportunity to the the we done systems was have them warfare RV Navy fashion the by platforms, awareness had sitting ships filed they are last the lot is that it Just side and engineering responsible we've now a situational money what at integrators and we’re with this a or sell years our as systems, and much our provide on visualization, What to for going we in can of with a range to the platforms, another and many we talent, that for our found all of When now go are we and side see things systems we systems, easier introduce that - the counter that to all is much our future money I this, predictor relationship in now the that sensor will going history is, when sink them. we saw the parallel to of if and for a night. any cases think enjoying engineering systems that pouring we’re closer was we different certain And with much absolute then it a we’re a with saw shape where all Army of the contracting to be night them GD passed communications, we’re just pouring we parallel we doing is we here. CACI and regard not solutions, that government long we've the in opportunity sit with with saw CACI that the data we’re

told future? going capital into remain from continue second, to are that CSRA whether we be strategic a is view, the particularly it, acquiring our another what We our out just is did there we didn’t to that but company, with it companies you probably are deployment is priority will do we to organic integrator. an we going comment there, an As acquisitive being to, of acquisitive we point growth wouldn’t until know or first

Operator

will come DeNardi from question Please ahead. of next The go Stifel. Joe

Unidentified Analyst

you career a I John and Again [indiscernible] is time congrats hope for this Annapolis. guys, on your wonderful in back home Hey Dave enjoy Joe.

you or can I improved us has like pace everyone protracted and procurement [ph] looks fourth through for what have government’s kind question share we're the with here of First decline? environment is, the quarter, halfway the

John Mengucci

Yes, John, John. this is

importance have and been believe to make FY of As on coming We where is about plan greater pursuing billion continues you the awards spending What us support, that front of XXXX, list everyone time we the have worth XXth have. plans those at we it If over plan. The the revenue recompetes quarter to contain growth programs we is right FFB progress. support look solutions. the I of our forward awards to than larger strategy only on we those that FY of were continue knows, supports four-year more orders. our to of recompetes believe flow under to more than is, fee going consecutive if have of government XXXX look have of contractual we solutions X% we arrangements and into $X at

another indicator of advantage less of more our So part we recompetes portfolio that and part funds is the spend to on ever on an new solutions CMP because are being of increasing business. of were able

of mentioned given or XX% bridges, we year we what about think that again the year regardless value. not recompeted bridge duration the any of XX% going note to our about a will our in budgetary see I quarter but of important You to XXXX environment as awards, impact about backlog book we’re also new level something so FY to and being last we that of recompete incremental that but it continue, have, And of XX% recompetes revenue we’re win of I think with about half out revenue come behavior impact current bridge, is is our earnings, saw of in recompetes going to bridged. is that only full activity not does

bridge of FY billion number a work XXXX of north of rate on bridges the of recompete $X.XX there be about at really looked you that had recompetes and awards win XX% if we So $X.X would X. billion aren’t somewhere

Unidentified Analyst

Okay.

concerned have price lot a to movement guys we be all as percent type work at solutions work, about about a of sales? company’s the talked should your You fixed

John Mengucci

no, is little for answer that bit. but talk let’s a about Short

better solutions FFP indicate performance Our and more performance. does

bottom not you’re term to us and of top that results line of seeing on long think chasing I our there allowing growing only line, grow the bottom what but the strategy frankly as type well. work it’s the So that is out also we’re line

the our focus of firm percentage bottom it’s a of but performance quarter-to-quarter FY outstanding. is unit revenue fixed on firm each revenue that over I the of basis difference it’s points XX both quarter. have So XXXX fixed a it’s individual measure XXXX within really of actually I generate more though FY fluctuation. a line on of and will What mix again It’s not that wouldn’t XXXX we fixed that our price growth, programs John, of measure our level measures, excellence making had really and that important revenue increase has been programs XXXX, price or in in price on operational is

Ken Asbury

you is the the we Yes, to fixed future, John increase. firm look into of price want would I or of percentage tell over fixed kind Ken. see as unit that - we work price this

I our at be or in of XX% time probably, business So point like something think we content should the maybe higher. some targeting even

Operator

Research Krishna Please Vertical Sinha will Our ahead. of from next go Partners. question come

Krishna Sinha

I Hi you to Colonel the give Valor thanks come of medal there. that London just Ken Dragics over and should think up with Jack guys,

Ken Asbury

done, Well Krishna.

Krishna Sinha

in So I group I margins, like generate maybe if look it’s it terms well of ball XX peer the of over the here? you’re gauge Obviously end looking two a was innings at obviously a you what game coming and But different you've are in think margin got see where your can history, operating of look seems there, on just portfolio piece target growing to of against can your where at top the bps to trying XX I’m the you exceeded top terms that with you've question just at of just service the the piece if solutions your last kind that. years. I out maybe up and you from margins, on

term or the of to you that bps lot still that of in will the increase towards XX to intermediate the margin lower So the acceleration a opportunity do XX see come intermediate bps term? do in range in or XX end you or XX think it XX

Ken Asbury

a business, we kind one goals put the to we why takes as That of shift portfolio. should Yes, while that mid-teens of top as want how It evolving in to business a point. Krishna a into place is bottom and it I that simultaneous. be to our think line to in grow low the is

well, it sort good. look we'll But for of to think how budget XXXX, internally that – the are things psychological to certain quality the as we believe after has is up I effect do shape it very So pretty business. going do of I of going all it

of tailwinds a lot We business. this have to

ascend and bottom have we cycle. a to reinvest to you and about decision don’t picture. defense we to a and in national because start get past really and of the country us when homeland But historically the capabilities brings that's five clear the got I we the defense, XX what makes and see in what seven-year will will we've We usually curve tell

of will and finding So readiness at issues processing is the as war, and adversaries time happening, that kind us during a result on capability, that period we then of have in there's there are have the of notion from things a that certain if particular gain a and to same ground to both got that technical investments capabilities happening and happened you things fix make technologies we've allow two to time. this

frankly an making service us like business good a we decision the being or provider array of very the for very providing at data products, we that to for and business really very high fast a of eloquent I For it’s from of GD solutions end, aspirations like sort where as the processing sit. positioned where just such and bought solutions

has stop indicators us item see don’t that mean term some all that in the the moment. to will commercial we but at there getting I is I thing given just near see is It teens. crazy in think budget, the we it So the background could nothing the is likely happen a to middle not, the

Krishna Sinha

a there what be functions incremental lot to success, a profile term had give solutions forward had and SkyTracker intermediate for with try you work market margin the going you’ve the are the the your what's to-date, that? You opportunity going what’s of can solutions and success of develop doing? in kind kind And you’re to that us indication you of of seemed and

John Mengucci

is but your we're this other booked the that business first, least question are is firm customers a fixed margins. following working areas earlier what Krishna, come are point the two our for from more watching at at I with guess growth. gets to so to our percentage convert that John. up on there for expand price, programs firm opportunity all to also to basis fixed in Yes, to support One plus price and many that we should years of XX our cost this is price, is fixed us XX

performance. it’s level Secondly of the

that jobs XX% to we firm say at program at let's the after to of fixed So a may we’re XX% lifecycle margin bidding hypothetically through of price XX% rate XX% be booking build, to able burn able more the we to program our as and we're have down end the we're margin risk risks. that drop at then until of of to all mitigated

levels. for So of fixed it's from our revenue business been performance a price, is percentage of our not that only that price that's the percentage done fixed has

and key to remarks, been the company is because perform of of excellence has jobs. fixed not FY down some so We 'XX to this slowing the my price And FY firm 'XX, operational fixed then enterprise count on that continue that outstanding. on earlier

one areas; asked our of you about focus product. we three solutions I'll mentioned Yes, So sort great success with there. now, and had have you SkyTracker into

working situational edge mobile In line whether in or space area like on to potential million that's Given that recent the aperture tools that solutions tech new we really [indiscernible] their the so this involvement go we've high legislation that contract Navy's to does will some the protected our just to we've customers protection administration's supports of us customer some a the that not and and of of bases, Brazilian wearable plus added for leading customers us fixed and a stations outstanding our of ground sensitive awareness. customers that changes customer, Force service. better announced looking only top only Intel believe variant that on $XX missions that we'd non-interference but the expand a variant, fact U.S. of provide Air are potential our to for

the well folks on I remiss there and the didn't investments And AI. decade. a talk machine we've had some threats which signal battlefield working EW and left off EW with about is lot front of learning army identification and future Look, RF facing Navy SkyTracker On over the be we're solution of the and point, and for of these I'll are also detection today. one with if programs, a really

We those make have start been all is XX applying take those Krishna in our the markets data certain Intel to algorithms world processing to very, in very for into would that sole customers to making push our also was firm area knowledge and in other and RFPs difficult problems turn and work, fixed there the that where us to up faster is gives new price. our growth we're to source decision able more timelines that we again which do to

Operator

Vafi Capital. The ahead. will Loop come next question Please Joseph of go from

Joseph Vafi

Dave great, Hey morning, guys, and great run, congratulations. good truly

So standards on think on, one accounting does you And have anything going the just progression fiscal here, the in I of followup. new margin XXXX? change may then adoption for be materially Tom a

Tom Mutryn

both P&L so fees which today. increase our time is we doing the for But no piece ASC lumpiness [ph]. historically number FY some require somewhat of us be the Joe, full fourth it growth margins. awards FY and to The and opposed in amount work year Yes, total for the of we've have a to due line, some the to for and which the unaffected in the days in tucked kind do in bottom we the performed kind that it by comparable during through the slight recognize had full turns have our higher work year programs. is should 'XX award episodically second as 'XX higher period with of we quarters work flowing 'XX XXX will Today out these historically

Joseph Vafi

around? is a and the takeaways vehicles on or program that that a takeaway funding funding this may that out a lot. of there be there on is well know the are Thanks be awards and that get would as existing that extra may the now new some quarter environments majority little starts, helpful I be better little to were actual for bit mix color the then it great on in brand is perhaps maybe one moving John number Okay, quarter, in new it awards new, were the

John Mengucci

if sure business looked were at XX-XX say Joe. that I in the the new growth say on Yes, would and takeaways, we it's contract includes range. I things would which somewhere

got the well if you in revenue 'XX flow as all our at FY fact [ph] In markets as we've look our expected markets growth awards. both in

was job. our is be intelligence threats. CDM new on to services, revenue awards $XXX One government a a of and about and a prepared program four the example sister DHS are plan That's my is systems, requirement. the that that FY an of markets. our is severe entire new during department new, a standpoint. spoke their centered businesses, That Our And agencies FY 'XX 'XX be remarks, very cyber example growth all going those going million protecting enterprise I the of some new-new IT on built to from intelligence

driving plan ’XX overall a and but, got awards lot revenue our as So again 'XX win to are 'XX we supportive growth rate a FY that well. FY in of

it's area are talk here a you operations The to secure as other whether battlefield that it's as going it select whether we new new been and able lot of we've place continuity deal always is on some with business of Joe put but there well. win or very communications, jobs the see out about partnerships AWS, We domestically. to

unclassified, So today. working faces secret with issue partners government that secure such do that but as Blackberry address and Samsung, communications we the how

some expect in awards well. So I as would new arena that

Operator

come will ahead. Wells from Fargo. question next of Edward Caso Our Please go

Edward Caso

game to golf in he's going what's hopes time his the implied pass contracts? to particularly congrats I’ll bigger here. my morning. you they've and do about for rates been, going Dave along work heading, win curious Good context this where Thanks. where got big, on guidance, in that think of and I'm they're

Ken Asbury

Yes, this is Ken.

on I work, we're we've for - XXs. been as say think over I the win XXs rates would recompete very we're XX the of several takeaway low in years in On the or new to steady rates range. last kind

be drive selective that We're things time. sharper. I much to in And level, think go we we different as things go years, We win been, several it's to it able and bigger and skills we're after last that out of same a as we've more this at are have time. top line the all calls, sharpening we couple that might very bidding. the a earlier being rate on the margin discussed the Over complex drive we're after then and us take but our to could

I that things as lot that goes of are and think instead work, but our of team would and everything at making contracts. lower getting time blue are years line go in really interested looking on, green quality of growth then I’m So the at sure we - putting we that kind better kinds through a blue that With the because seen. enduring to of we officers I want. of there of they get but some top doing to pass Five in better the two a think rate, invest, our seen and existing is a the we on as in ago we're still into This I'm awards we write as of is us as of lot you'll that after things the really part don't money of bridging still mid-years, the extra last that see the billion closer We've contracts overall put more thing they're terms procurements contracting because time we've what now, win all have coming money work rates the into out. that $X new existing work, we’ve have probably we're John probably, go year as in mentioned Right well. up. doing simply

we're the think us all over up. with will direction pleased bottom and line get, we're win rates the pleased, and time and top I our see very all-in you'll at growth get So

should we XX% think be to I in stuff new basis on XX% on an annual range. winning the

Edward Caso

on we're And in point year progress, most I continuing your the is that's to and going resolution, believe guidance what's is the making under length of thank guidance? the Congress the you. what is assume question your embedded impact my start Great, CR other though does at CR,

Ken Asbury

you thank been, question. we've Ed, the Yes, for

been and the on early get was has I deal roll some this protest thing, But moment the remarkable sort, the bipartisan right these to behalf think a NDAA act of the of amount haven’t place. sort on sort I years still sort closing first sort but Congress signed early thing appropriations and way mean, time and noted is CR delays We just which the up. I've activity in XX in discussions of of two-year going a in bipartisan a see I last down put there that of and budgets about budget put given in into the are this of any cycle. things our at that we put

concerned I'm be We our partial some that's of of There appropriations sort CR. bills calculations. about CR less see doesn’t one the a into make may activity, it. that not may baked So but

Operator

will come question of Robert ahead. Suisse. next Spingarn The from Credit Please go

Audrey Preston

And Audrey Dave is fantastic this step on on everyone join Rob. else to Preston I his and next just want the for Hi in congratulating career. on

towards mix So we've a the contract DoD been noticing before even acquisition today. the announced

mentioned or the naval should your should then so, with up and you acquisition following out Navy, as with tactical with a up Army this of again the be shift? on Navy we maybe end a the on something more And thinking contracts And exposure earlier? strategic idea the as size broaden you announced could pretty that, say number par of of significantly? Do the opportunity you so being potential have the this any what before also of

John Mengucci

much sure think show Yes, each and is guess is your out and John. we done first on like. quarter I that this civil work put question, how I the tables DoD

is numbers, by business to we're happen once any solutions, markets we're times of where deliver to IT in the lay capabilities that multiple going As helps deliver we're expanse is the also we government, is awards. past, of quarter across being that's those is than business customer not federal numbers that we there the are on easier is is can of part those lay others, magic the of and to solutions market if and set that they to how the deliver result enterprise in happen line to we’re us one of that more given not drive those how customer sell to The a managing bottom mentioned is capturing. that one XX what aligned the which we're profitable in not invest others, going growth. There than fact also in

and can customer the understanding solutions Army needs high set, where our in mostly professional positions, we professional of services works, grown relates customer acquisition how and question on strong we your business, mission - of missions Navy before a drive part some we and also the subcontract When long follow as work services that second understand current that the to think we work was, that what's took the that were more so it with end with did some we’ve and business? does leave this more customer's to that with I some us Army work. up as we centric could so solutions

solutions shipbuilding, Engineering deliver importantly acquisition I to is that is how mission with understand Systems think open of spoke but systems to PEO Ken all the Navy going capability. step more within those build that Navy us next that we their that for and us what ships and forward does business help you'll about the our earlier, the see of ships that up

it's So make I said, on to of more, would more those look the internal the and and better Ken are missions side we at Naval investments. plan will understand as Navy growth that first a this step, some us multi-year as that over time will allow what

with fixed as bottom So price we're line to firm able top as realm and grow to then other potential new in to to be the Navy well solutions customers. able move a

Operator

Seaport Sullivan of come The ahead. Josh next Global. will from Please go question

Josh Sullivan

Hey and good morning you, Dave. thank

Shared miss this, Service Center, assisting or the new driver center of this shared me strategy material the a You’re interest is the is any that Excuse to service to certainly way? morning, with regard of going what the in acquisition be M&A GD missed changing if overlap but and I the here. the was

Tom Mutryn

the related easily Center integrate is the Shared do transaction of will of at of undertook to Josh be out. reasons kind acquisitions, able scalable processes relatively the Service variety Yes, easily the of we Shared and one those start we Center. be for reasons CACI. A Tom. I We this number into can if was Service businesses should

the the we know mentioned, cost bringing of very in GD going attractions overhead so that business bring in the business. at Center in able John things acquired well CACI into the with the of far. going businesses. transaction and little hence with you kind business line with generate we're We of relatively the piece are or And quite to one the opened able the July General we’re direct to Shared Dynamics As could expense the in to acquisition of over with to approximately revenue margins direct EBITDA CACI's easily Service is absorb

Josh Sullivan

Okay, impact outside is any way And then got for of mentioned, seen quantify retention retention? you just then there to you to the And you encompassed or to expect, there employment it. uptick in these is enhanced see have programs XXXX? the you programs guidance risk that the raise in maybe to employee continue an any you what's have

Ken Asbury

is just out, the macro. them this We've look Ken. rolled Josh but let's at Yes,

to you the seeing we from So people more yet adds listened feedback sort getting wow - of the great we basis, of us hiring not around lose population want than a we that. says, XXX that is and employee feedback did it we the we're month don't see that other anybody when percentage The preferences survey and strong. deal that on we're monthly very is a goodwill results some our we're lose guys don't of employee a and to that we to

companies most of we areas; we're of Center and saved could and for has other poured the think investing that So people that lot John that a different CACI employee we a it's got two With one talked people we've do these of what We I of of it reflection things I wanted change the There's around doing retention. in money part back to all see regard because days. that going it's to, lot question our and was, about. attraction we upped second on about looking non-economic some programs the are here? be things a if at your experience to in technology our Shared into Service how

of we’re that But there as see what do done And keep below do I rate we've and now that there or at point able need has our significantly rather because it what been are near some able benefits year-over-year. a benefit we term other they this solutions structure think of that we to fact is we're to a from view. investigate In to fit. how go slightly

up, think thus to starting to so But So go issues it next tell we measurable the this impact on as for retention happy it's time were was Please is it seen choice from that with that it be new. measurable impact of Drexel in think Ruttenbur our some do. far many frank, Brian it to right we it's haven't will To of we us question because terms needs ability a I that you or had before we come can our attract. a begin on ahead. Hamilton. The absolutely

Brian Ruttenbur

thank much. you Great, very

questions. sets of So three

First kind of guidance had growth there X% guidance, your give all you guidance if on go over the is the a basis basis give year just going through any you and of directionally so on of have along quarterly that mentioned I half points and kind is long-term, quarterly you long-term can of internal XX I a followup. the Then to XX think any that that with be guidance? more weighted long-term second this than us year to it first, the you

Tom Mutryn

models and guidance depreciation in provided of amortization to revenue is June with initial details build interest of other variables allows which of this it. additional key and Tom. Yes, associated net kind people provided to some and couple their kind income guiding and We and on Brian then we and

we longer given that higher fee historically fees fees first with second quarterly we as will proportionately. the no had margins not third the award than not as to, exist award award quarter will being comment do higher make fourth and I and the have plan That We recon and periods, the guidance lumpy quarters. but

would the with to guidance that quarterly only So be numbers. regards give able we're

Brian Ruttenbur

XX your place. And bridges? to of roughly about know the about that's second all still is a to Okay. of terms much XX talked and despite basis then recompetes, recompetes then be I was been And some, normal part mentioning up long-term very guidance, the but X% XX% of points, business in in you this question year the your my from also of going it's

Ken Asbury

the not accelerating FY is Josh, XXXX. X%, that Yes actually this Ken. in to regard With see we

update today is the inorganic result don't to next Our point guidance of really We the on as described as that's of X% activities see into a the X.X%. activity organic. depending change that year at do additional that plan and and rate award of from see From one somewhere the to acquisition. point. solid see we market that our now goes best a in organic right of for addressable XXXX on closer judgment XXXX number. an to is for some we a X.X%, maybe growth is the year I We the closer growth see X% our in but in additional coming adjusted think view, overall Tom in growth We the - the including is mid-point an our may what like

would what going but was the around keep question the XX% I we're XX, the We contracts sorry we're being of about that's in I a than you future on five-year that's be five-year, XX%, different XX% to number. it So think think that a say may your - part there. second most centers. be X, at year, for right in I'm And recompetes now a this if probably should 'XX on FY low

So heavily to business XX% new try that we in 'XX lean more existing secure we will into FY of while business.

Operator

will go The Cowen. Rumohr of ahead. Cai next come Please from question Von

Cai Von Rumohr

we'll chorus been how miss join David. the terrific. let much Yes, me saying He's

things budget FY is some and and us you're I kind funding this are Can to the of kind Thanks I it's of to to it, ability which So team have of the commit the over their but And going so secondly, things; a because can going have obviously you of that situation? not DoD color of roll business targeting, roll strong talked some in of much. increasing, is sort you're what looking 'XX on know sort different going think kind others some maybe is after? September over types strategy of your you huge which a tell things it pretty you that to of we're large about of are you're at, what give two first, you comment characteristics takeaways can, takeaways, which in after going environment. us end of by customers

Ken Asbury

are bet that asked has I You more I haven't - DoD Cai. anything I other I there. This is and don't rolling Ken. for regard know that's to customers. that changed I granted. some has think of over, flexibility With customers sort been about heard know

you more think will level, associated So that the we'll under waiver I your real that flexibility and some to is, congressional contracting activity their different see counting would answer some Defense at kind if not with question how maybe customers they’re other Department for of money. the are of

think we're of a scope have there's of this what helps of government the community be year with deal where able lot a to of any number qualify with don't think short fiscal lot for said places there's into money somewhat [ph] movement more acquisition ability a the broad should in that's from of contract coming I I to point a because year view it. so of not, why of slender see ’XX be ’XX, and we work rest government fiscal that. the we'll different, a year later Again, the times, on probably we've growth

things hunting our be business an at, to with question regard of future, are that that that we're provider. the are elephant not are you your to categories. point part positioning where of if some in we're looking There we've existing with will where two Now customers or had I satisfied about our a view put communication observing going would from

value, I for piece existing we requirements IT where say that's add services the we government services market are in what the so, government of there that bigger And market piece could where years. a pursue some number the recompete is have would that about of sort the on now. traditional say would experience value gone need, piece of largest one the market, of and that's of terms we being and or selective customer's which add could believe And I change where they and we what it's right

the some targets be be I and par may we people portend really could are technology. going of there be other after really analytics. loops It wouldn't is with excited it about again looking and could to part be data to keep from visualization, have place, where to capabilities all. it traditional now think fact about communications, are we are could that to of it may technology, who generation even processed speed able and what on apply We really decision the be information their their to things sort of leapfrog they when at out UAS, because we're traditional rethinking do used. those is about apply there. at providers current what collected big data could war everything next apply the because takeaways would those are ahead us providers The of about could from counter It SIGINT way There That it. of to in may be in of they opportunities

piece. a them as lot new So well of a eye again, a entering in we're is to a we other looking markets people have through The area is of be. of think is, they performing market being that our couple broad it of I somebody we market more are there's on. contracts where finding have board of world that quickly pursuing of larger that's brave as on could And part not the there's and recompete series variety the traditional that are that capabilities we And ways a able an at our there. bring that the

Cai Von Rumohr

Thank much. very you

Operator

back will over like and [Operator I'd turn any Mr. closing Instructions] conclude questions, question Ken the remarks. further Asbury Showing answer our to this to for conference session. no

Ken Asbury

are We'd Dan thank thank and today. their you followup as have a webcast and like for Allison many help I of on to appreciate to do afternoon to my questions. We way who this that to and out of Dragics little Leckburg bit. lot figure well. want him about participation going much, know very you said appreciation Well, a extent to for your Dave. will Dave who around a you logged the great all keep mentor, Tom in miss calls a him for as available I’m things we'll I but everybody to

your of day. So call. to good in want very all you. a Have interest concludes our Thank you this for I CACI. thank

Operator

now presentation. has concluded. today's attending The conference Thank you for

You may now disconnect.

CACI International (CACI) 16 Aug 182018 Q4 Earnings call transcript