CACI INTERNATIONAL INC DE
For the period ended Mar 31, 2024. Filed Apr 24, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2024 · Filed Apr 24, 2024
CACI$611.16+1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2023-12-31; filed 2024-01-25.
0000016058-24-000030
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-03-31; filed 2024-04-24.
0000016058-24-000070
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 75 previous paragraphs and 75 current paragraphs.
58 unchanged; 17 reworded; 0 added; 0 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Reworded paragraphs (17)
Previous wording
We carefully follow federal budget, legislative and contracting trends and activities and evolve our strategies to take these into consideration. On December 29, 2022, the President signed into law the omnibus appropriations bill that provided full-year funding for the government fiscal year (GFY) ending September 30, 2023 (GFY23). Of the total approximately $1.7 trillion in discretionary funding, approximately $858 billion was for national defense and approximately $773 billion was for nondefense, as well as an additional $47 billion of supplemental funding for Ukraine. The defense and nondefense funding levels represent increases of approximately 10% and 6%, respectively, over GFY22 enacted levels. On March 9, 2023, the President released his budget request for GFY24, which called for an increase in defense spending of approximately 3% and an increase in nondefense spending of approximately 8% over GFY23 levels. On June 3, 2023, the President signed into law legislation that suspends the federal debt limit until January 2025 and caps discretionary spending in GFY24 and GFY25. Specifically, GFY24 defense spending is capped at $886 billion, an increase of 3% and in-line with the President’s budget request, and GFY24 nondefense spending is capped at levels similar to GFY22 (though after various adjustments may be essentially flat with GFY23 levels). For GFY25, discretionary spending growth (both defense and nondefense) is capped at 1%. While future levels of defense and nondefense spending are difficult to project, particularly given ongoing budget negotiations in Congress, we believe that there continues to be bipartisan support for defense and national security-related spending, particularly given the heightened current global threat environment.
Current wording
We carefully follow federal budget, legislative and contracting trends and activities and evolve our strategies to take these into consideration. For the government fiscal year (GFY) ending September 30, 2023 (GFY23), defense and nondefense funding levels represented increases of approximately 10% and 6%, respectively, over GFY22 enacted levels. On June 3, 2023, the President signed into law legislation that suspended the federal debt limit until January 2025 and capped discretionary spending in GFY24 and GFY25. Specifically, GFY24 defense spending is capped at $886 billion, an increase of 3% and in-line with the President’s GFY24 budget request, and GFY24 nondefense spending is capped at levels similar to GFY22 (though after various adjustments would essentially be flat with GFY23 levels). For GFY25, discretionary spending growth (both defense and nondefense) is capped at 1%. On March 23, 2024, the President signed into law an appropriations bill that funds the federal government for GFY24, generally consistent with the terms set forth in the debt limit legislation signed in June 2023. Earlier in March, the President released his GFY25 budget request that was also generally consistent with the terms set forth in the debt limit legislation signed in June 2023. While future levels of defense and nondefense spending are difficult to project, particularly given ongoing budget negotiations in Congress, we believe that there continues to be bipartisan support for defense and national security-related spending, particularly given the heightened current global threat environment.
Previous wording
We provide Expertise and Technology to government customers. We believe that the total addressable market for our offerings is sufficient to support the Company's plans and is expected to continue to grow over the next several years. Approximately 70% of our revenue comes from defense-related customers, including those in the Intelligence Community (IC), with additional revenue coming from non-defense IC, homeland security, and other federal civilian customers.
Current wording
We provide Expertise and Technology to government customers. We believe that the total addressable market for our offerings is sufficient to support the Company's plans and is expected to continue to grow over the next several years. Approximately 74% of our revenue comes from defense-related customers, including those in the Intelligence Community (IC), with additional revenue coming from non-defense IC, homeland security, and other federal civilian customers.
Previous wording
•Increased investments in advanced technologies (e.g., Artificial Intelligence, 5G), particularly software-based technologies;
Current wording
•Increased investments in advanced technologies (e.g., Artificial Intelligence), particularly software-based technologies;
Previous wording
Results of Operations for the Three and six Months Ended December 31, 2023 and 2022
Current wording
Results of Operations for the Three and Nine Months Ended March 31, 2024 and 2023
Previous wording
Revenues. The increase in revenues for the three and six months ended December 31, 2023, as compared to the three and six months ended December 31, 2022, was primarily attributable to new contract awards and growth on existing programs.
Current wording
Revenues. The increase in revenues for the three and nine months ended March 31, 2024, as compared to the three and nine months ended March 31, 2023, was primarily attributable to new contract awards and growth on existing programs.
Previous wording
The following table summarizes revenues by customer type with related percentages of revenues for the three and six months ended December 31, 2023 and 2022, respectively(in thousands):
Current wording
The following table summarizes revenues by customer type with related percentages of revenues for the three and nine months ended March 31, 2024 and 2023, respectively(in thousands):
Previous wording
Direct Costs. The increase in direct costs for the three and six months ended December 31, 2023, as compared to the prior year period, was primarily attributable to direct labor costs from organic growth on existing programs and higher materials and other direct costs. As a percentage of revenue, direct costs were 68.4% and 68.6% for the three and six months ended December 31, 2023, respectively, and 66.3% and 66.1% for the three and six months ended December 31, 2022, respectively. Direct costs include direct labor, subcontractor costs, materials, and other direct costs.
Current wording
Direct Costs. The increase in direct costs for the three and nine months ended March 31, 2024, as compared to the prior year period, was primarily attributable to direct labor and subcontractor costs from organic growth on existing programs and higher materials costs. As a percentage of revenue, direct costs were 66.6% and 67.9% for the three and nine months ended March 31, 2024, respectively, and 65.6% and 65.9% for the three and nine months ended March 31, 2023, respectively. Direct costs include direct labor, subcontractor costs, materials, and other direct costs.
Previous wording
Indirect Costs and Selling Expenses. As a percentage of revenue, indirect costs and selling expenses were 22.3% and 22.1% for the three and six months ended December 31, 2023, respectively, and 23.5% and 23.7% for the three and six months ended December 31, 2022, respectively, driven by cost efficiencies across the Company. The increase in indirect costs and selling expenses for the three and six months ended December 31, 2023, as compared to the prior year periods, was primarily attributable to increased expenses due to a larger workforce, resulting in increased fringe benefits, as well as an increase in professional services.
Current wording
Indirect Costs and Selling Expenses. As a percentage of revenue, indirect costs and selling expenses were 22.2% and 22.1% for the three and nine months ended March 31, 2024, respectively, and 23.5% and 23.6% for the three and nine months ended March 31, 2023, respectively, driven by cost efficiencies across the Company. The increase in indirect costs and selling expenses for the three and nine months ended March 31, 2024, as compared to the prior year periods, was primarily attributable to increased expenses due to a larger workforce, resulting in increased fringe benefits, as well as an increase in professional services.
Previous wording
Depreciation and Amortization. Depreciation and amortization for the three and six months ended December 31, 2023 was consistent with the prior year periods.
Current wording
Depreciation and Amortization. Depreciation and amortization for the three and nine months ended March 31, 2024 was consistent with the prior year periods.
Previous wording
Interest Expense and Other, Net. The increase in interest expense and other, net for the three and six months ended December 31, 2023, as compared to the prior year period, was primarily attributable to higher interest rates and higher outstanding debt balances.
Current wording
Interest Expense and Other, Net. The increase in interest expense and other, net for the three and nine months ended March 31, 2024, as compared to the prior year period, was primarily attributable to higher interest rates and higher outstanding debt balances.
Previous wording
Income Tax Expense. The Company’s effective income tax rate was 20.7% and 21.9% for the three and six months ended December 31, 2023, respectively, and 21.5% and 22.5% for the three and six months ended December 31, 2022, respectively. The effective tax rates for the three and six months ended December 31, 2023, and 2022 were favorably impacted by research and development tax credits, partially offset by the unfavorable impacts of certain executive compensation.
Current wording
Income Tax Expense. The Company’s effective income tax rate was 24.9% and 23.2% for the three and nine months ended March 31, 2024, respectively, and 23.4% and 22.8% for the three and nine months ended March 31, 2023, respectively. The effective tax rates for the three and nine months ended March 31, 2024, and 2023 were favorably impacted by research and development tax credits, partially offset by state income taxes.
Previous wording
As of December 31, 2023, the Company had total backlog of $26.9 billion, compared with $26.5 billion a year ago, an increase of 1.5%. Funded backlog as of December 31, 2023 was $3.7 billion. The total backlog consists of remaining performance obligations (see Note 5) plus unexercised options.
Current wording
As of March 31, 2024, the Company had total backlog of $28.6 billion, compared with $25.3 billion a year ago, an increase of 13.0%. Funded backlog as of March 31, 2024 was $3.2 billion. The total backlog consists of remaining performance obligations (see Note 5) plus unexercised options.
Previous wording
The Company has a $3,200.0 million Credit Facility, which consists of a $1,975.0 million Revolving Facility and a $1,225.0 million Term Loan. The Revolving Facility is a secured facility that permits continuously renewable borrowings and has subfacilities of $100.0 million for same-day swing line borrowings and $25.0 million for stand-by letters of credit. As of December 31, 2023, we had $617.5 million outstanding under the Revolving Facility and no borrowings on the swing line.
Current wording
The Company has a $3,200.0 million Credit Facility, which consists of a $1,975.0 million Revolving Facility and a $1,225.0 million Term Loan. The Revolving Facility is a secured facility that permits continuously renewable borrowings and has subfacilities of $100.0 million for same-day swing line borrowings and $25.0 million for stand-by letters of credit. As of March 31, 2024, we had $550.0 million outstanding under the Revolving Facility and no borrowings on the swing line.
Previous wording
The Term Loan is a five-year secured facility under which principal payments are due in quarterly installments of $7.7 million through December 31, 2023 and $15.3 million thereafter until the balance is due in full on December 13, 2026. As of December 31, 2023, $1,163.8 million was outstanding under the Term Loan.
Current wording
The Term Loan is a five-year secured facility under which principal payments are due in quarterly installments of $7.7 million through December 31, 2023 and $15.3 million thereafter until the balance is due in full on December 13, 2026. As of March 31, 2024, $1,148.4 million was outstanding under the Term Loan.
Previous wording
Net cash provided by operating activities decreased $65.2 million for the six months ended December 31, 2023, when compared to the six months ended December 31, 2022, as a result of a $76.8 million decrease in cash received from the Company's MARPA and $75.0 million in net unfavorable changes primarily in operating assets and liabilities driven by increased revenue volume and the timing of vendor payments, partially offset by a $40.0 million reduction in income tax payments and a $46.6 million reduction in CARES Act payroll tax payments.
Current wording
Net cash provided by operating activities increased $104.2 million for the nine months ended March 31, 2024, when compared to the nine months ended March 31, 2023, as a result of a $35.1 million increase in cash received from the Company's MARPA, a $46.6 million reduction in CARES Act payroll tax payments and a $29.1 million reduction in income tax payments, partially offset by $6.6 million in net unfavorable changes primarily in operating assets and liabilities driven by increased revenue volume and higher days sales outstanding.
Previous wording
Net cash used in investing activities increased by $12.6 million for the six months ended December 31, 2023, when compared to the six months ended December 31, 2022 primarily due to a $10.9 million increase in payments for business acquisitions.
Current wording
Net cash used in investing activities increased by $81.5 million for the nine months ended March 31, 2024, when compared to the nine months ended March 31, 2023 primarily due to an $81.6 million increase in payments for business acquisitions.
Previous wording
Net cash used in financing activities decreased $90.8 million for the six months ended December 31, 2023, when compared to the six months ended December 31, 2022, primarily as a result of a $245.5 million increase in net borrowings under our Credit Facility, partially offset by a $150.5 million increase in cash used to repurchase our common stock.
Current wording
Net cash used in financing activities decreased $32.3 million for the nine months ended March 31, 2024, when compared to the nine months ended March 31, 2023, primarily as a result of a $112.0 million decrease in cash used to repurchase our common stock, partially offset by a $74.7 million increase in net repayments under our Credit Facility.