DLHC - Earnings call transcript Q1 2019

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Operator

Good morning, and welcome to the DLH Fiscal 2019 First Quarter Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Chris Witty, Investor Relations Advisor. ahead. go Please Chris Witty

Chris Witty

everyone. morning, good and you, Thank

annual company's and financial in measures. to and I'd President other will call, non-GAAP results we to now release Securities filings both Kathryn available for reported that like to to will fiscal that, This call of Form On may forward-looking GAAP a the earnings the the X these and Financial forward-looking Zach Please company's the duty refer investor President On is any today's relate are update with on our events We risks undertake outlook the now DLH's which ahead, presentation and and actual report statements. and today The of the to Investor Zach. shown is to be non-GAAP we'll presentation. the to under from A our over page. on and also risk I statements referencing results not statements. XXXX safe website. with Executive statements Officer; GAAP harbor me go include differ These our after forward-looking would JohnBull, are could PowerPoint beyond. in Chief included and various Chief to any that next, followed earnings contained materially is our and Commission. on our factors Exchange XX-K results for reconciliation the Please website to subject and do company's up and With cause questions. presentation Parker, the Zach Zach. provide CFO, Parker, uncertainties in like release call on CEO, in brief Kathryn Officer. which speak Slide by JohnBull, open call it turn statement,

Zach Parker

X, outlook conference an first let will Thank start. Starting everyone. XXXX the XXXX XXXX. to million, call first we agencies Slide to up off rose financial and overview programs quarter performance XX% for with excellent versus by continue to high of to providing for serve. demand quarter you, good the we for the core a Revenue morning as is our across Welcome level on some and that $XX.X me begin which see Chris, demonstrate strong our our color nearly

not on that a government effect going of set strong XX.X% the millions As very more key last crucial day execution, per shutdown million. believe our doubled noted year-over-year XX.X% for execution than was down of in continued moment. we do lives customers we for leverage a significant and of there of last shut well a and balance strategic initiatives strong hand. one. our sheet million believe quarter We operating quarter with and income under $X we will $X.X $X.XX finished positioned on net income cash Overall, year are versus posted margin approximately further this Kathryn the share growth and address for diluted of another veterans. already our with gross Americans the we serve funded company's to ratio XX day if quarter, Reflecting to to fully any core from it material have forward. did as We day will of stable impact and us agencies a are military this our the XXXX. year, considered the were Even is not fiscal anticipate

competitive me our let Turning outlook X, provide updated an landscape. Slide on to

of the deemed the country Administration, people sure to they services needing. core running on both our of being As are sides considered agencies has the noted trends talking closely funding Washington. by critical benefited are Defense and Whether previously, the are get that we're that or Services Veterans Human making of and in aisle Department important aligned about with that the the DLH clients our

focus We in will accounts. continue strategically to these

business diverse DoD and our areas federal these Health Sciences. will competencies. other over new Human and Services agencies. government leverage The key has and of Our Life veterans, Solutions These covering focus with million core of our opportunities Public and $XXX qualified aligns and DLH pipeline very well

us there very growth game regard All of continued landscape. M&A is acquisition administration With viable competitive activity, aggressively this and to solicitation our have remains continues pharmacy compete with That move re-compete contract these government reduce we as three number we're alter our this update in community new the continuing the recent allow of year. work, IDIQ to government no to successfully the it acquisitions and and plan Thus, mergers areas our coupled phase. and environment. industry to remained reshape seen to to in VA over the a evaluation vehicles

unique continue to training in can satisfaction. a business mission with program. move our and invest the our our staff and and capabilities our centric new experienced We level agenda win critical completes core It hiring applications, customer underscores of our day, current on execute skilled differentiating employees at and members and that high This credentials important of have customer is to highly the innovative forward. solutions end workforce competent to

activity this have business continue in engage our looking company's underlying seem the of build and year. XXXX There picked to to a slight our with and to regard activity. focused been diversify also certainly opportunities the things up base in a end to We We're near strategically capabilities. bolster slowdown space, but for M&A to have of the transactions

As are the accretive always, our and cultural in thorough right defining potential analyzing optimistic; future. fit is we're acquisitions, very but near

within serve growth expand also bolstering we capabilities value-added while profile, can that our that and plans. our We margin improvement our continue to see fit nicely our transactions markets core boost

our we positioning and feel are remainder is we experience and turn of company's balance fiscal FY Kathryn Officer, forward I'd positive continue JohnBull. With another be believe shutdown we the to going improving the is not, sound Chief that stable, there integrating to acquisitions that, XXXX our for Financial through strong sheet, or XXXX. Kathryn? about on like Given DLH opportunities we over actively call results believe presented. Overall, whether footing financial will to the for

Kathryn JohnBull

start everyone. morning report to to pleased a solid Thank and We're XXXX. you, good fiscal Zach,

to posted we've three increase programs higher year’s an for revenue contract XX.X% The once expansion existing representing ended reflected of strong and the XXXX first Turning of million, quarter. again $XX.X the across of key revenue prior XX, X, over months vehicles. on December services our demand Slide

primarily affected funded As XX was already Zach as materially government day fully the noted, not we for were agencies fiscal the DLH XXXX. shutdown serve by

increase Slide revenue margin as profit $X.X the versus expansion. to moving to well on gross X, Now this approximately profit million due $X.X higher the as of million year posted with XX.X% total gross company quarter, last

As percent XX.X% mix. last year quarter versus first reflecting sales, of a the gross program was improved margin XX.X%

and rose gross million just for as to that and from $X.X recorded quarter million last sorry, XXXX for we in $X.X a $X.X the profit a year Turning million to mentioned income Slide operations revalue reflecting from the last year more I that first we share largely Remember X, tax higher derived $X.X fiscal than a from that G&A versus million lower to Cuts December prior $X.X income or we well for diluted year, Tax one-time million. assets million we the loss of a resulting million, reported Act, took million $X.XX last months we the three the per expense our had – recorded Jobs as slightly or We where ended provision of year, this $X.X recorded approximately share in the the then, $X.XX expenses. charge net of versus charge $X.X a $X.X XX, from year tax XXXX doubling, period.

of shows is was nothing credit XXXX balance million X beginning QX factors in million year to the year. balance revenue sheet and at hand in versus for quarter. December income versus $X.X our XXXX million had had million. million the period. of end statement. the reflecting our at Turning Slide our facility $X.X in We of $X.X to of just the the of We $X.X million at a borrowed a end $X.X X, approximately quarter million under revolving Slide our our months XX, summary XXXX on in cash EBITDA as the percent loan $X.X fiscal had term the net GAAP $X.X of of a ended reconciliation discussed. versus of earnings EBITDA A fiscal the I three prior was EBITDA

approximately to Our net remains million primarily this trailing I in used concludes debt QX, now would from for during EBITDA that receivables discussion of $X.X to cash turn position questions. we've the operations the we that, certain to our after like quarter and financial collected timing statement. one operator less from while end. than to call just With the over of open This resulted my

Operator

ahead. first question Thank question-and-answer session. you. with Gomes [Operator We'll Joe go the begin Noble from Capital. comes Instructions] Please Our now

Kathryn JohnBull

Joe. morning, good Hi,

Zach Parker

Joe, are you still there?

Operator

your Mr. Gomes, is now live. line

Joe Gomes

me. excuse me Yes, hear now? you Can

Zach Parker

are you, go. you There How Joe?

Joe Gomes

Good.

Sorry.

the and margin rest succeeding little there morning Are margin and that type nice a the of expecting detail Sorry appreciated. quarters out was still be the still would gross Good differential question are wondering about job on Just quarter. will kind year? I hold first the go – a on that you really gross of My for be the color flat. of you here? in or relatively does that. for G&A, how the great

Kathryn JohnBull

improvement do the in to course, But each vary that respective think of contribution carry Sure. of on period depending forward. Certainly, to within range. gross the some lines. the margins period real will going there's likely mean, we sustaining I it's of that business

Joe Gomes

And forward? belief will type is is of you're businesses that be causing getting that Or going that just those what the of your sustaining? because

Kathryn JohnBull

in continue in it manage to of ourselves of derives – benefit. type marketplace respects delivering more and and some delivery and steps some more is of to benefits of our some to experiencing we're in the taking our cases, of it actively from other position be competitive costs cost the as work So savings growth active where some in continue we're

Joe Gomes

end, was – now. on And on receivable the Obviously, quarter’s but a accounts just a increase I'm difference collected those sure significant was make in this. saying have at clear timing been there Okay. that just and you're to

Kathryn JohnBull

of items XXth of definitely looks and quarter, within this of you little early can contract receivables just runs contracts near-daily the the on very XX imagine, but January paying but those cut-off days to well a some December our But of substantial as items as from And system the December they we that over in well days a those and line, terms. sales important if Certainly. way, pretty one on case at collect know within was Xrd we of aggregate. the much the the well track and out terms below as did the to slips in XXst have large go January them either through basis

Joe Gomes

little a mentioned back the give is talked last then I’m XXXX. And wondering some guys more that early million. I you And know pipeline color. here the you you in $XXX great. if coming be about opportunities now Okay, quarter to up of just fiscal can might

kind wondering be out to can might of as just of of start bit roadmap lay little a a these So what to when awards you some happening.

Zach Parker

no, Yes, question. good

through and very around well the opportunities We and both rest the major much closely regarding be a are at really would seeing still get operating much out those the resolution, concern folks very this in for the in and position and the that of substantial and awards uncertainties as a new number continuing – government do and from that of way budget of and closely are new some of business president's not that of into are late. taking us government acquisition working until discussion of think XXXX number budget. has round We're a some XXXX. new the the reduction a these of agencies of some looking the the as waiting that the of awards some budget a held programs they agencies We like existing around near-term

time to to monitor and effect, XXXX proposals. deals turn backlog on they'll able and We certainly pretty a have that around that the a So for XXXX. we're some in to we're as that. a But of healthy for hope, in number have continue we're indicated, our pipeline, awaiting those would reasonable be we hopeful these request do anticipate going still

Joe Gomes

VA one could anything Okay, Is appreciated. said on program, sense the great, of than timing on you know be there? and later? I real for sooner one but rather there's me. it last provide that any you Or would no update

Zach Parker

evaluations. which still. But course formal obvious appropriate effect in XXXX through a still material timing know and Yeah, and a today nothing usually kind process. and of these going on quiet is in period probably of not have what they’re that will occur when to We're the this we ends is of FY our are we September. thinking it types This an given where XX

Joe Gomes

you. Thank great. Okay,

Operator

[Operator questions to the turn like any queue. closing for Instructions] the back in Parker, be would remarks. to There I no CEO further over to Zach appear conference

Zach Parker

again, Kathryn and today to of and in you, webcast know Thank you for everyone operator, of follow-up have you today. may and so participating Chris, We for that our myself parts thank throughout questions, available tomorrow are some follow-up.

we a and detailed With the any like going New forward participate and York more have information you and attend leadership Becker will our areas now. our of in the that, invite with you of at to great on to a Meeting. board & to have look that of and and Annual be addition, may and we'll but of to team you both It’s with our be for Expect held look so engaging In a in we'll New scheduled choose of forward March to that in I of directors members XXst soon. partner, be see York, and Poliakoff. in business presentation participate. to any rest the Kathryn offices few will Shareholder for to corridor Bye chatting our day more there

Operator

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

You now disconnect. may

DLH (DLHC) 15 Feb 192019 Q1 Earnings call transcript