Financial Data and Key Metrics Changes - The company reported a record year in 2022 with total revenue increasing by 14.6% to $1.78 billion and service revenue up 15.8% to $1.29 billion, driven by strong performance across federal, state, local, and commercial energy client categories [26][35] - Adjusted EBITDA margin on service revenue increased to 14.9% in 2022 from 14.3% in 2021, with adjusted EBITDA rising by 20.6% to $191.8 million [35][34] - Non-GAAP EPS for the fourth quarter increased by 31.1% to $1.56, while full-year non-GAAP EPS rose by 19.7% to $5.77 [14][15] Business Line Data and Key Metrics Changes - Revenues from federal government clients surged by 45.6% year-on-year in Q4, comprising 15.4% organic growth and contributions from acquisitions [28] - The IT modernization and public health sectors are key growth areas, with IT modernization growing at 15% annually and expected to maintain double-digit growth [21][20] - Revenues from commercial energy clients increased by 17% in Q4, reflecting strong demand for energy efficiency and clean energy advisory services [30] Market Data and Key Metrics Changes - Revenues from state and local governments grew by 7% in Q4, driven by disaster management and environmental services [8] - The international government business faced challenges due to the completion of a significant project and currency translation effects, but mid-single-digit growth is expected in 2023 [9] - The company ended 2022 with a business development pipeline of over $8.5 billion, a 20% increase from the previous year [10] Company Strategy and Development Direction - The company aims for double-digit revenue growth in 2023, with a focus on high-growth markets such as IT modernization, public health, and climate resilience [5][11] - Strategic investments and acquisitions are expected to enhance capabilities and drive future growth, with a goal to achieve high single-digit organic service revenue growth through 2024 [11][39] - The company is prioritizing debt repayment while maintaining its dividend policy and share repurchase program [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth opportunities presented by the IIJA and IRA, anticipating significant growth in climate and resilience services [20] - The company remains optimistic about its ability to navigate the current economic environment, citing its resilience and the stability of its revenue streams [58] - Management highlighted the importance of maintaining a strong workforce and culture to support growth objectives [19] Other Important Information - The company repurchased 176,375 shares at an average price of $96.18 per share in 2022, with $112 million remaining under its share repurchase authorization [16] - The company declared a quarterly cash dividend of $0.14 per share, reinforcing its commitment to returning value to shareholders [37] Q&A Session Summary Question: Timing of contract awards and financial impact related to the infrastructure bill - Management expects material growth opportunities from the IIJA to ramp up in 2024 and 2025, with a pipeline of $100 million to $150 million in opportunities [40] Question: Impact of renewable energy project delays on the company - Management noted that while developers face interconnection challenges, the company remains busy with advisory work related to renewable projects [22] Question: Insights on IT modernization and consultative selling - Management emphasized the importance of engaging clients on both domain expertise and technology modernization to differentiate their offerings [85] Question: Balancing debt repayment versus M&A - Management indicated a focus on debt repayment in the first half of 2023, while remaining open to potential acquisition opportunities if they arise [75][92] Question: Talent availability and recruitment efforts - Management acknowledged the need to add talent to meet growth objectives and highlighted ongoing investments in recruiting and maintaining a strong culture [78]

Part I [Business](index=7&type=section&id=ITEM%201%2E%20BUSINESS) ICF International, Inc. provides professional services and technology-based solutions to government (76% of 2022 revenue) and commercial clients Revenue and Total Backlog (in millions) | Metric | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | :--- | | **Revenue** | $1,780.0 | $1,553.0 | $1,506.9 | | **Total Backlog** | $3,856.2 | $3,198.9 | $2,897.6 | - The company's primary services cover the entire project life cycle, including Advisory, Program Implementation, Analytics, Digital, and Engagement Services[22](index=22&type=chunk) Client Type Revenue Percentage | Client Type | 2022 Revenue % | 2021 Revenue % | 2020 Revenue % | | :--- | :--- | :--- | :--- | | Government | 76% | 71% | 65% | | Commercial | 24% | 29% | 35% | Largest Government Clients Revenue Percentage | Largest Government Clients | 2022 Revenue % | 2021 Revenue % | 2020 Revenue % | | :--- | :--- | :--- | :--- | | Dept. of Health and Human Services | 23% | 20% | 17% | | Dept. of State | 6% | 5% | 5% | | Dept. of Defense | 4% | 5% | 6% | Backlog (in millions) | Backlog (in millions) | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | | Funded | $1,786.9 | $1,593.5 | $1,522.3 | | Unfunded | $2,069.3 | $1,605.4 | $1,375.3 | | **Total Backlog** | **$3,856.2** | **$3,198.9** | **$2,897.6** | - As of December 31, 2022, the company had approximately **9,000 employees globally**, with an overall employee turnover of **20.6%** for 2022[24](index=24&type=chunk)[90](index=90&type=chunk) [Risk Factors](index=21&type=section&id=ITEM%201A%2E%20RISK%20FACTORS) The company faces significant risks from its heavy reliance on government contracts, challenges in integrating acquisitions, cybersecurity threats, and international operational risks - A majority of revenue is derived from U.S. government contracts (**76% in 2022**), making the company vulnerable to changes in government spending, budget delays, and shutdowns[16](index=16&type=chunk)[97](index=97&type=chunk)[99](index=99&type=chunk) - Fixed-price contracts, which accounted for **45% of 2022 revenue**, expose the company to risks of cost overruns and reduced profitability if costs are not accurately estimated and controlled[118](index=118&type=chunk)[119](index=119&type=chunk) - Acquisitions present integration challenges and risks of goodwill impairment, with goodwill and purchased intangibles accounting for approximately **64% of total assets** as of December 31, 2022[138](index=138&type=chunk)[140](index=140&type=chunk) - The company faces continuous and evolving cybersecurity risks, including threats to its systems and sensitive client data, which could lead to liability and reputational harm[131](index=131&type=chunk)[167](index=167&type=chunk)[168](index=168&type=chunk) - International operations are subject to risks including the negative effects of Brexit on UK and EU business, geopolitical instability such as the war in Ukraine, and foreign currency fluctuations[127](index=127&type=chunk)[162](index=162&type=chunk)[164](index=164&type=chunk) [Unresolved Staff Comments](index=34&type=section&id=ITEM%201B%2E%20UNRESOLVED%20STAFF%20COMMENTS) The company reports no unresolved staff comments from the U.S. Securities and Exchange Commission - None[173](index=173&type=chunk) [Properties](index=34&type=section&id=ITEM%202%2E%20PROPERTIES) The company leases all its office space globally, including its corporate headquarters in Reston, Virginia - The company leases approximately **1.4 million square feet** of office space in over **82 locations globally**[175](index=175&type=chunk) - The corporate headquarters in Reston, Virginia, comprises approximately **208,274 square feet** under a lease extending through May 2039[174](index=174&type=chunk) [Legal Proceedings](index=34&type=section&id=ITEM%203%2E%20LEGAL%20PROCEEDINGS) The company is involved in various legal matters in the ordinary course of business, with a specific litigation resolved in February 2023 without material impact - The company is involved in various legal matters arising in the ordinary course of business, which are not expected to have a material adverse effect on its financial position[176](index=176&type=chunk) - Litigation related to the Road Home contract with the State of Louisiana was resolved on February 17, 2023, with the impact not being material to the company's consolidated financial statements[177](index=177&type=chunk)[492](index=492&type=chunk) [Mine Safety Disclosures](index=34&type=section&id=ITEM%204%2E%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - Not applicable[178](index=178&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=35&type=section&id=ITEM%205%2E%20MARKET%20FOR%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company's common stock trades on NASDAQ, pays quarterly dividends, and maintains a share repurchase program with $111.9 million remaining available as of December 31, 2022 - The company's common stock is traded on the NASDAQ Global Select Market under the ticker symbol "**ICFI**"[181](index=181&type=chunk) - A share repurchase program is in place with an authorized aggregate of up to **$200.0 million**, with approximately **$111.9 million** remaining available for repurchases as of December 31, 2022[191](index=191&type=chunk)[270](index=270&type=chunk) - During the three months ended December 31, 2022, the company did not repurchase any shares under its publicly announced share repurchase program[191](index=191&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=ITEM%207%2E%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) In fiscal year 2022, revenue grew 14.6% to $1.78 billion, while operating income declined 2.0% and net income fell 9.7% due to increased amortization, higher interest expenses, and lower gross margins [Results of Operations](index=44&type=section&id=Results%20of%20Operations) Financial Performance (in millions) | Metric | 2022 | 2021 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $1,780.0 | $1,553.0 | +14.6% | | **Operating Income** | $108.8 | $110.9 | -2.0% | | **Net Income** | $64.2 | $71.1 | -9.7% | - Revenue growth was primarily driven by a **$245.3 million** increase from U.S. federal government clients and a **$25.2 million** increase from U.S. state and local government clients[238](index=238&type=chunk) - Operating income as a percentage of revenue decreased to **6.1% in 2022** from **7.1% in 2021**, mainly due to lower gross margins, higher indirect expenses, and increased amortization from recent acquisitions[245](index=245&type=chunk) - Net interest expense increased by **133.2% to $23.3 million**, driven by higher average debt balances to fund acquisitions and a rise in average interest rates from **1.6% in 2021 to 3.3% in 2022**[246](index=246&type=chunk) - The effective income tax rate for 2022 was **23.5%**, a decrease from **28.9% in 2021**[248](index=248&type=chunk) [Non-GAAP Measures](index=46&type=section&id=Non-GAAP%20Measures) Non-GAAP Adjusted EBITDA (in thousands) | (in thousands) | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | | Net income | $64,243 | $71,132 | $54,959 | | EBITDA | $157,178 | $142,044 | $122,133 | | Total Adjustments | $34,658 | $16,985 | $20,514 | | **Adjusted EBITDA** | **$191,836** | **$159,029** | **$142,647** | Non-GAAP Diluted EPS | Per Share Data | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | | U.S. GAAP Diluted EPS | $3.38 | $3.72 | $2.87 | | **Non-GAAP Diluted EPS** | **$5.77** | **$4.82** | **$4.17** | - Adjustments to derive non-GAAP measures primarily include impairment of long-lived assets, acquisition-related expenses, severance costs, facilities consolidation costs, and amortization of intangibles[254](index=254&type=chunk)[258](index=258&type=chunk) [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) Cash Flow Summary (in thousands) | (in thousands) | 2022 | 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $162,206 | $110,205 | | Net cash used in investing activities | ($258,844) | ($194,481) | | Net cash provided by financing activities | $90,371 | $23,233 | - As of December 31, 2022, the company had **$556.3 million** of outstanding debt and **$440.0 million** of available borrowing capacity under its Credit Facility[260](index=260&type=chunk)[264](index=264&type=chunk) - Cash used in investing activities in 2022 included **$237.3 million** for the acquisitions of SemanticBits and Blanton[274](index=274&type=chunk) - The company declared and paid cash dividends of **$0.14 per share** each quarter during 2022[271](index=271&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=51&type=section&id=ITEM%207A%2E%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risks include interest rate fluctuations on variable-rate debt and foreign currency exchange rate risk, mitigated by interest rate swaps - The company is exposed to interest rate risk on its variable-rate debt, where a **1% increase in interest rates** would have increased 2022 interest expense by approximately **$5.9 million**[277](index=277&type=chunk) - To manage interest rate risk, the company had four interest rate swap agreements with a total aggregate notional amount of **$200.0 million** as of December 31, 2022[277](index=277&type=chunk) - The company is subject to foreign currency exchange rate risk, with a **10% increase or decrease** in the value of the U.S. dollar against all currencies estimated to impact revenue by approximately **1%**, or **$13.5 million**[279](index=279&type=chunk) [Controls and Procedures](index=52&type=section&id=ITEM%209A%2E%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2022, excluding recent acquisitions - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of December 31, 2022[283](index=283&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2022[284](index=284&type=chunk) - The assessment of internal controls excluded the 2022 acquisitions of SemanticBits and Blanton, which together represented **1.2% of total assets** and **3.8% of total revenues** for the year[285](index=285&type=chunk) Part III [Directors, Executive Officers, Corporate Governance, and Other Matters](index=54&type=section&id=ITEMS%2010-14) Information for Items 10 through 14 is incorporated by reference from the company's Proxy Statement for the 2023 Annual Meeting of Stockholders - Information for Items 10, 11, 12, 13, and 14 is incorporated by reference from the Proxy Statement for the 2023 Annual Meeting of Stockholders[294](index=294&type=chunk)[295](index=295&type=chunk)[296](index=296&type=chunk)[297](index=297&type=chunk)[298](index=298&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=55&type=section&id=ITEM%2015%2E%20EXHIBITS%20AND%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists the financial statements and exhibits filed with the Form 10-K, noting the omission of certain schedules - This item contains the list of financial statements included in the report, such as the Consolidated Balance Sheets and Statements of Comprehensive Income[300](index=300&type=chunk) - A detailed list of exhibits filed with the report is provided, including corporate governance documents, material contracts, and certifications[302](index=302&type=chunk) Financial Statements and Notes [Note 2 - Summary of Significant Accounting Policies](index=68&type=section&id=NOTE%202%20-%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) The company's significant accounting policies include revenue recognition, goodwill impairment testing, leases, capitalized software, stock-based compensation, and income taxes - Revenue is primarily recognized over time, and for fixed-price contracts, the company uses a percentage-of-completion method based on the ratio of actual costs incurred to total estimated costs[356](index=356&type=chunk)[360](index=360&type=chunk) - Goodwill is tested for impairment annually as of October 1, with no impairment required for 2022 based on a qualitative assessment for its single aggregated reporting unit[374](index=374&type=chunk)[375](index=375&type=chunk) - The company operates in a single reportable segment providing professional services, with revenue from U.S. federal government clients representing **55% of total revenue in 2022**[392](index=392&type=chunk)[393](index=393&type=chunk) [Note 10 - Long-Term Debt](index=79&type=section&id=NOTE%2010%20-%20LONG-TERM%20DEBT) As of December 31, 2022, the company had $556.3 million in total long-term debt and amended its credit agreement in May 2022, extending maturity to May 2027 Debt Components (in millions) | Debt Component | Outstanding Balance (Dec 31, 2022, in millions) | | :--- | :--- | | Term Loan | $288.8 | | Delayed-Draw Term Loan | $220.0 | | Revolving Credit | $52.6 | | **Total before debt issuance costs** | **$561.4** | - On May 6, 2022, the company amended and restated its credit agreement, extending the maturity to May 6, 2027, and increasing its borrowing capacity[417](index=417&type=chunk) - As of December 31, 2022, the company had unused borrowing capacity of **$545.4 million** from its revolving line of credit, with **$440.0 million** available after considering financial limitations[420](index=420&type=chunk) [Note 11 – Revenue Recognition](index=81&type=section&id=NOTE%2011%20%E2%80%93%20REVENUE%20RECOGNITION) The company disaggregates revenue by client market, type, and contract mix, with $1.5 billion in unfulfilled performance obligations as of December 31, 2022 Revenue by Client Market (2022, in thousands) | Revenue by Client Market (2022) | Amount (in thousands) | Percentage | | :--- | :--- | :--- | | Health, education, and social programs | $906,081 | 51% | | Energy, environment, and infrastructure | $664,996 | 37% | | Safety and security | $129,357 | 7% | | Consumer and financial | $79,530 | 5% | Revenue by Contract Mix (2022, in thousands) | Revenue by Contract Mix (2022) | Amount (in thousands) | Percentage | | :--- | :--- | :--- | | Fixed-price | $802,804 | 45% | | Time-and-materials | $713,581 | 40% | | Cost-based | $263,579 | 15% | - As of December 31, 2022, the company had **$1.5 billion** in unfulfilled performance obligations, which it expects to satisfy over the next two years[427](index=427&type=chunk) [Note 16 – Business Combinations](index=91&type=section&id=NOTE%2016%20%E2%80%93%20BUSINESS%20COMBINATIONS) In 2022, the company acquired SemanticBits for $220.0 million and Blanton & Associates, adding digital modernization capabilities and goodwill - On July 13, 2022, the company acquired SemanticBits, LLC for a preliminary purchase price of **$220.0 million in cash**[467](index=467&type=chunk)[468](index=468&type=chunk) - The SemanticBits acquisition resulted in the recognition of **$159.7 million in goodwill** and **$64.1 million in intangible assets**[469](index=469&type=chunk) - On September 1, 2022, the company acquired Blanton & Associates, an environmental consulting firm, resulting in **$9.7 million of goodwill** and **$11.4 million of intangible assets**[465](index=465&type=chunk) [Note 20 - Commitments and Contingencies](index=96&type=section&id=NOTE%2020%20-%20COMMITMENTS%20AND%20CONTINGENCIES) The company has contingent liabilities from letters of credit and guarantees, with a long-standing litigation resolved in February 2023 without material financial impact - As of December 31, 2022, the company was contingently liable under **$2.0 million** in open standby letters of credit and **$9.2 million** in guarantees[489](index=489&type=chunk) - Litigation with the State of Louisiana concerning the Road Home Program, which concluded in 2009, was resolved on February 17, 2023, with the resolution not having a material impact on the company's financial statements[491](index=491&type=chunk)[492](index=492&type=chunk)

ICF International, Inc. (NASDAQ:ICFI) Q3 2022 Results Conference Call November 3, 2022 4:30 PM ET Company Participants Lynn Morgen - Advisiry Partners John Wasson - Chairman and CEO Barry Broadus - CFO James Morgan - COO Conference Call Participants Tobey Summer - Truist Securities Marc Riddick - Sidoti Operator Good day, and thank you for standing by. Welcome to the Q3 2022 ICF Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to ...

PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company's total assets increased to $2.16 billion as of September 30, 2022, from $1.85 billion at year-end 2021, primarily driven by a significant increase in goodwill from acquisitions; total liabilities also rose, mainly due to increased long-term debt to fund these acquisitions; for the third quarter of 2022, revenue grew 18.7% year-over-year to $467.8 million, but net income decreased by 6.3% to $19.1 million, and diluted EPS fell to $1.01 from $1.07; the nine-month results showed a 12.0% revenue increase to $1.30 billion, while net income declined by 6.2% to $55.4 million; cash flow from operations significantly decreased to $6.6 million for the nine months ended September 30, 2022, from $64.8 million in the prior-year period Consolidated Balance Sheet Highlights (Unaudited) | (in thousands) | September 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $8,483 | $8,254 | | Contract receivables, net | $282,271 | $237,684 | | Goodwill | $1,190,450 | $1,046,760 | | **Total Assets** | **$2,157,760** | **$1,849,534** | | **Liabilities & Equity** | | | | Long-term debt | $681,197 | $411,605 | | **Total Liabilities** | **$1,320,021** | **$1,046,064** | | **Total Stockholders' Equity** | **$837,739** | **$803,470** | Consolidated Statements of Comprehensive Income Highlights (Unaudited) | (in thousands, except per share) | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$467,777** | **$394,060** | **$1,304,355** | **$1,165,063** | | Operating income | $28,234 | $32,265 | $85,713 | $92,348 | | **Net income** | **$19,105** | **$20,390** | **$55,364** | **$59,053** | | **Diluted EPS** | **$1.01** | **$1.07** | **$2.91** | **$3.10** | Consolidated Statements of Cash Flows Highlights (Unaudited) | (in thousands) | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $6,596 | $64,763 | | Net Cash Used in Investing Activities | ($253,403) | ($12,279) | | Net Cash Provided by (Used in) Financing Activities | $239,025 | ($91,668) | [Notes to Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail significant accounting policies and events during the period, including two Q3 2022 business combinations (SemanticBits for $220.0 million and Blanton & Associates) that significantly increased goodwill and intangible assets; the company also amended its credit facility in May 2022, increasing its term loan and adding a delayed draw term loan, resulting in total long-term debt of $701.7 million; revenue is disaggregated by market, client, and contract type, with U.S. federal government clients representing 58% of Q3 revenue; the company also detailed its use of interest rate swaps for hedging, its share repurchase program status, and a pending $220.2 million lawsuit from the State of Louisiana related to the Road Home Program, for which no liability has been recorded - On July 13, 2022, the Company acquired SemanticBits for a preliminary purchase price of **$220.0 million** in cash, funded by the existing Credit Facility, resulting in goodwill of **$144.6 million** and customer-related intangible assets of **$63.0 million**[65](index=65&type=chunk)[66](index=66&type=chunk)[68](index=68&type=chunk) - On September 1, 2022, the Company acquired Blanton & Associates, an environmental consulting firm, which added **$5.8 million** to goodwill and **$11.4 million** to intangible assets[64](index=64&type=chunk) - In May 2022, the company entered into a Restated Credit Agreement, increasing the term loan facility to **$300 million**, adding a new **$400 million** delayed draw term loan facility, and extending the maturity to May 2027[30](index=30&type=chunk)[31](index=31&type=chunk) Revenue Disaggregation (Three Months Ended Sep 30, 2022) | Category | Revenue (in thousands) | Percent of Total | | :--- | :--- | :--- | | **Client Type** | | | | U.S. federal government | $271,255 | 58% | | U.S. state and local government | $65,613 | 14% | | International government | $23,075 | 5% | | Commercial | $107,834 | 23% | | **Contract Mix** | | | | Time-and-materials | $188,758 | 40% | | Fixed price | $210,810 | 45% | | Cost-based | $68,209 | 15% | - The company has **$1.4 billion** in unfulfilled performance obligations as of September 30, 2022, which it expects to satisfy over approximately two years[40](index=40&type=chunk) - The company is involved in a lawsuit with the State of Louisiana, which is seeking approximately **$220.2 million** in alleged overpayments from the Road Home contract; the company believes the claim has no merit and has not recorded a liability[87](index=87&type=chunk)[88](index=88&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 18.7% Q3 revenue growth to increases from U.S. federal and state/local government clients, driven by the health, education, and social programs market, and contributions from recent acquisitions like SemanticBits; however, operating income decreased 12.5% in Q3, primarily due to higher direct costs, increased amortization of intangible assets from acquisitions, and higher interest expense; the company's liquidity remains strong, with $316.7 million available under its credit facility; long-term debt increased to $707.0 million to fund acquisitions; the company provides non-GAAP measures, including a Non-GAAP Diluted EPS of $1.61 for Q3 2022, up from $1.32 in Q3 2021, which adjusts for acquisition-related costs and amortization [Overview and Outlook](index=23&type=section&id=OVERVIEW%20AND%20OUTLOOK) The company provides professional services and technology solutions across four key markets: Energy/Environment, Health/Education, Safety/Security, and Consumer/Financial; management sees long-term growth opportunities driven by societal needs in clean energy, healthcare, and disaster recovery; the strategy focuses on expanding client relationships, seeking larger engagements, and pursuing strategic acquisitions, such as the recent purchases of SemanticBits and Blanton; while the COVID-19 pandemic has presented challenges, particularly in commercial marketing services, the majority of the business, especially government contracts (77% of Q3 revenue), has shown continuity; the company has over 8,000 employees globally - The company's strategy is to enhance client relationships, seek larger engagements, and complete and integrate strategic acquisitions to build scale and broaden service offerings[98](index=98&type=chunk) - Recent acquisitions include ITG (2020), ESAC and Creative (2021), and SemanticBits and Blanton (Q3 2022)[98](index=98&type=chunk) - Government clients accounted for approximately **77% of revenues** for the three months ended September 30, 2022, and this segment has experienced continuity despite the COVID-19 pandemic[102](index=102&type=chunk) - The company has over **8,000 full and part-time employees** and serves clients from its D.C. area headquarters and more than 70 offices worldwide[107](index=107&type=chunk) [Results of Operations](index=25&type=section&id=RESULTS%20OF%20OPERATIONS) For Q3 2022, revenue increased 18.7% to $467.8 million, driven by U.S. federal and state government clients, but operating income fell 12.5% to $28.2 million due to higher costs, including a 187.3% increase in amortization of intangible assets from recent acquisitions; for the nine months ended September 30, 2022, revenue grew 12.0% to $1.30 billion, while operating income decreased 7.2% to $85.7 million; the decline in operating margin was primarily attributed to increased amortization and higher interest expenses from debt used to fund acquisitions Q3 2022 vs Q3 2021 Performance | (dollars in thousands) | Q3 2022 | Q3 2021 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $467,777 | $394,060 | 18.7% | | Direct Costs | $307,295 | $254,175 | 20.9% | | Operating Income | $28,234 | $32,265 | (12.5%) | | Net Income | $19,105 | $20,390 | (6.3%) | - The Q3 revenue increase of **$73.7 million** was primarily driven by a **$76.1 million** increase from U.S. federal government clients, particularly in the health, education, and social programs market[114](index=114&type=chunk) - Amortization of intangible assets increased by **187.3%** in Q3 2022, primarily due to the acquisitions of SemanticBits, Blanton, ESAC, and Creative[118](index=118&type=chunk) - Q3 interest expense increased **193.1%** to **$7.5 million** due to a higher average debt balance (**$675.9M** vs **$341.0M**) and a higher average interest rate (**3.99%** vs **1.60%**)[120](index=120&type=chunk) [Non-GAAP Measures](index=28&type=section&id=NON-GAAP%20MEASURES) The company provides non-GAAP metrics to supplement its GAAP results; Service Revenue, which excludes subcontractor costs, increased 21.7% to $335.4 million in Q3 2022; Adjusted EBITDA, which excludes special charges like acquisition costs and staff realignment, grew to $49.8 million in Q3 2022 from $43.8 million in the prior-year quarter; Non-GAAP Diluted EPS, which also adjusts for amortization of intangibles and related tax effects, was $1.61 for Q3 2022, a significant increase from $1.32 in Q3 2021 Reconciliation of Net Income to Adjusted EBITDA (Unaudited) | (in thousands) | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | Net income | $19,105 | $20,390 | | EBITDA | $42,192 | $39,945 | | Total special charges and adjustments | $7,580 | $3,885 | | **Adjusted EBITDA** | **$49,772** | **$43,830** | Reconciliation of U.S. GAAP Diluted EPS to Non-GAAP Diluted EPS (Unaudited) | | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | U.S. GAAP Diluted EPS | $1.01 | $1.07 | | Special charges & adjustments (acquisitions, realignment, etc.) | $0.40 | $0.20 | | Amortization of intangibles | $0.46 | $0.16 | | Income tax effects | ($0.26) | ($0.11) | | **Non-GAAP Diluted EPS** | **$1.61** | **$1.32** | [Liquidity and Capital Resources](index=30&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company maintains a solid liquidity position, with $316.7 million available under its Credit Facility as of September 30, 2022; total long-term debt increased significantly to $707.0 million from $423.6 million at year-end 2021, primarily to fund acquisitions; Days Sales Outstanding (DSO) increased to 87 days from 76 days in the prior-year quarter, partly due to slower payments related to Puerto Rico disaster relief work; operating cash flow for the first nine months of 2022 was $6.6 million, a sharp decrease from $64.8 million in the same period of 2021, mainly due to lower net income and timing of working capital items; the company continues its share repurchase program, with $111.9 million remaining available - As of September 30, 2022, the company had **$402.3 million** of unused borrowing capacity under its Credit Facility, with **$316.7 million** available after considering financial and performance-based limitations[145](index=145&type=chunk) - Long-term debt increased to **$707.0 million** at September 30, 2022, from **$423.6 million** at December 31, 2021, primarily due to a net advance of **$283.4 million** to fund acquisitions[157](index=157&type=chunk) - Days Sales Outstanding (DSO) was **87 days** for the quarter ended September 30, 2022, compared to **76 days** for the same quarter in 2021[152](index=152&type=chunk) - Net cash provided by operating activities decreased to **$6.6 million** for the nine months ended September 30, 2022, from **$64.8 million** in the prior-year period[167](index=167&type=chunk) - As of September 30, 2022, **$111.9 million** remained available for share repurchases under the company's **$200.0 million** program[81](index=81&type=chunk)[164](index=164&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports that there have been no material changes in its market risk disclosures from those presented in its Annual Report on Form 10-K - There have been no material changes in the disclosures discussed in the section entitled "Quantitative and Qualitative Disclosures About Market Risk" in Part II, Item 7A of our Annual Report[171](index=171&type=chunk) [Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of the end of the period covered by this report; there were no significant changes in internal controls over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls - Based on an evaluation as of the period covered by the report, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[172](index=172&type=chunk) - There have been no significant changes in internal controls over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[172](index=172&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal matters arising in the ordinary course of business; management currently believes that the ultimate liability from these proceedings will not have a material adverse effect on its financial position, results of operations, or cash flows - The company is involved in various legal matters and proceedings arising in the ordinary course of business, which are not expected to have a material adverse effect on its financial position, results of operations, or cash flows[176](index=176&type=chunk) [Risk Factors](index=34&type=page&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - There have been no material changes in the risk factors discussed in the section entitled "Risk Factors" disclosed in Part I, Item 1A of the company's Annual Report[177](index=177&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the third quarter of 2022, the company repurchased 3,344 shares at an average price of $98.63 per share; these purchases were made from employees to cover withholding taxes related to the settlement of restricted stock units; no shares were repurchased under the publicly announced share repurchase program during the quarter; as of September 30, 2022, approximately $111.9 million remained available for repurchase under the program Share Repurchase Activity (Three Months Ended Sep 30, 2022) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Publicly Announced Program | | :--- | :--- | :--- | :--- | | July 1 - July 31 | — | $ — | — | | August 1 - August 31 | 3,344 | $98.63 | — | | September 1 - September 30 | — | $ — | — | | **Total** | **3,344** | **$98.63** | **—** | - The **3,344 shares** purchased were from employees to pay required withholding taxes related to the settlement of restricted stock units[178](index=178&type=chunk) - The maximum approximate dollar value of shares that may yet be purchased under the plan is **$111,869,762**[178](index=178&type=chunk) [Defaults Upon Senior Securities](index=35&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) None reported - None[179](index=179&type=chunk) [Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable - Not applicable[180](index=180&type=chunk) [Other Information](index=35&type=section&id=Item%205.%20Other%20Information) None reported - None[181](index=181&type=chunk) [Exhibits](index=35&type=section&id=Item%206.%20Exhibits) The report lists several exhibits filed electronically, including CEO and CFO certifications pursuant to Exchange Act Rules and the Sarbanes-Oxley Act, as well as financial statements formatted in iXBRL - Exhibits filed include CEO and CFO certifications (31.1, 31.2, 32.1, 32.2) and iXBRL data files (101, 104)[183](index=183&type=chunk)

ICF International, Inc. (NASDAQ:ICFI) Q2 2022 Earnings Conference Call August 3, 2022 4:30 PM ET Company Participants Lynn Morgen - AdvisIRy Partners Barry Broadus - SVP & CFO John Wasson - Chairman & CEO James Morgan - COO Conference Call Participants Joseph Vafi - Canaccord Kevin Steinke - Barrington Research Marc Riddick - Sidoti Operator Welcome to ICF's Second Quarter 2022 Earnings Conference Call. My name is Michelle Foster, and I will be your operator for today's call. Please note that this conferenc ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section provides the unaudited consolidated financial statements for ICF International, Inc. as of June 30, 2022, including balance sheets, income statements, cash flow statements, and detailed notes [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for ICF International, Inc. as of June 30, 2022, including balance sheets, income statements, cash flow statements, and detailed notes [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets and total liabilities and stockholders' equity remained relatively stable at approximately $1.85 billion from December 31, 2021, to June 30, 2022 Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $452,952 | $449,163 | | **Total Assets** | **$1,850,802** | **$1,849,534** | | **Total Current Liabilities** | $341,875 | $376,631 | | **Long-term debt** | $435,075 | $411,605 | | **Total Liabilities** | $1,031,385 | $1,046,064 | | **Total Stockholders' Equity** | $819,417 | $803,470 | [Consolidated Statements of Comprehensive Income](index=4&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) For Q2 2022, revenue increased by 7.8% year-over-year to $423.1 million, but net income decreased by 9.4% to $18.4 million, with diluted EPS at $0.97 Key Performance Indicators (in thousands, except per share data) | Metric | Q2 2022 | Q2 2021 | Six Months 2022 | Six Months 2021 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $423,110 | $392,525 | $836,578 | $771,003 | | **Operating Income** | $29,776 | $31,954 | $57,479 | $60,083 | | **Net Income** | $18,397 | $20,312 | $36,259 | $38,663 | | **Diluted EPS** | $0.97 | $1.07 | $1.91 | $2.03 | - Cash dividends declared per common share remained constant at **$0.14** for the quarter and **$0.28** for the six-month period, year-over-year[12](index=12&type=chunk) [Consolidated Statements of Cash Flows](index=5&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2022, net cash provided by operating activities was $6.4 million, nearly flat compared to the prior year, while net cash used in financing activities decreased significantly Net Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | **Net Cash Provided by Operating Activities** | $6,409 | $6,341 | | **Net Cash Used in Investing Activities** | ($8,115) | ($7,475) | | **Net Cash Used in Financing Activities** | ($9,074) | ($45,642) | | **Decrease in Cash, Cash Equivalents, and Restricted Cash** | ($11,969) | ($46,077) | [Notes to Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the company's accounting policies and financial statement line items, including revenue disaggregation, credit facility details, and subsequent events - The company's major clients are U.S. federal government departments, particularly the Department of Health and Human Services, Department of State, and Department of Defense[18](index=18&type=chunk) - On May 6, 2022, the company entered into an Amended and Restated Credit Agreement, increasing the term loan to **$300 million**, adding a **$400 million** delayed draw term loan, and extending the maturity to May 2027[30](index=30&type=chunk) - On July 13, 2022, the company acquired SemanticBits, LLC for a purchase price of **$220.0 million** in cash, funded by the existing Credit Facility[68](index=68&type=chunk) - The company is involved in a lawsuit with the State of Louisiana regarding the Road Home Program, with the state seeking approximately **$220.2 million**, which the company believes has no merit and has not recorded a liability[71](index=71&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's performance, highlighting an 8.5% revenue increase for the first six months of 2022, driven by U.S. government clients, while operating income decreased due to higher direct costs and amortization from recent acquisitions [Overview and Outlook](index=20&type=section&id=Overview%20and%20Outlook) The company provides professional services and technology solutions across four key markets and maintains a positive long-term outlook, expecting continued growth driven by societal needs and strategic acquisitions - The company reports as a single segment, focusing on professional services for government and commercial clients[78](index=78&type=chunk) - Long-term demand is expected to be driven by heightened concerns about the environment, clean energy, health promotion, and disaster relief efforts[79](index=79&type=chunk) - The company's strategy includes enhancing client relationships, seeking larger engagements, and completing strategic acquisitions to build scale and expertise[80](index=80&type=chunk) [Results of Operations](index=22&type=section&id=Results%20of%20Operations) For Q2 2022, revenue grew 7.8% year-over-year to $423.1 million, driven by U.S. federal and state government clients, but operating income fell 6.8% to $29.8 million due to higher costs and increased amortization Q2 2022 vs Q2 2021 Performance (in thousands) | Metric | Q2 2022 | Q2 2021 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $423,110 | $392,525 | 7.8% | | **Operating Income** | $29,776 | $31,954 | (6.8%) | | **Net Income** | $18,397 | $20,312 | (9.4%) | - Q2 2022 revenue growth was driven by a **$43.0 million** increase from U.S. federal government clients, offset by a **$10.0 million** decrease from international government clients and an **$8.0 million** decrease from commercial clients[96](index=96&type=chunk) - The increase in amortization of intangible assets by **$2.0 million** in Q2 2022 was primarily due to the acquisitions of ESAC and Creative Systems and Consulting in late 2021[100](index=100&type=chunk) Six Months 2022 vs 2021 Performance (in thousands) | Metric | Six Months 2022 | Six Months 2021 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $836,578 | $771,003 | 8.5% | | **Operating Income** | $57,479 | $60,083 | (4.3%) | | **Net Income** | $36,259 | $38,663 | (6.2%) | [Non-GAAP Measures](index=25&type=section&id=Non-GAAP%20Measures) The company uses non-GAAP measures like Service Revenue, EBITDA, Adjusted EBITDA, and Non-GAAP Diluted EPS to evaluate performance, with Adjusted EBITDA increasing to $44.1 million for Q2 2022 Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Q2 2022 | Q2 2021 | Six Months 2022 | Six Months 2021 | | :--- | :--- | :--- | :--- | :--- | | **Net Income** | $18,397 | $20,312 | $36,259 | $38,663 | | **EBITDA** | $39,802 | $39,701 | $77,660 | $76,115 | | **Total special charges and adjustments** | $4,329 | $311 | $8,756 | $1,624 | | **Adjusted EBITDA** | $44,131 | $40,012 | $86,416 | $77,739 | Reconciliation of Diluted EPS to Non-GAAP EPS | Metric | Q2 2022 | Q2 2021 | Six Months 2022 | Six Months 2021 | | :--- | :--- | :--- | :--- | :--- | | **Diluted EPS** | $0.97 | $1.07 | $1.91 | $2.03 | | **Non-GAAP EPS** | $1.33 | $1.19 | $2.63 | $2.32 | [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2022, the company had $410.9 million available under its Credit Facility, with long-term debt increasing to $454.8 million, and repurchased $17.0 million in shares - As of June 30, 2022, the company had **$438.1 million** of unused borrowing capacity under its revolving line of credit, with **$410.9 million** available after accounting for financial limitations[131](index=131&type=chunk) - Days Sales Outstanding (DSO) was **82 days** for the quarter ended June 30, 2022, the same as the prior-year quarter[139](index=139&type=chunk) - The share repurchase program was increased to a **$200.0 million** limit in November 2021, with **$111.9 million** remaining available for repurchases as of June 30, 2022[150](index=150&type=chunk)[151](index=151&type=chunk) - On August 3, 2022, the board approved a quarterly cash dividend of **$0.14 per share**[151](index=151&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes in its market risk disclosures since its last Annual Report on Form 10-K - There have been no material changes in the disclosures discussed in the section entitled 'Quantitative and Qualitative Disclosures About Market Risk' in Part II, Item 7A of the company's Annual Report[157](index=157&type=chunk) [Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of the end of the period, with no significant changes in internal controls over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the period covered by the report[158](index=158&type=chunk) - No significant changes in internal controls over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[158](index=158&type=chunk) [PART II. OTHER INFORMATION](index=32&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, unregistered sales of equity securities, and exhibits [Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal matters arising in the ordinary course of business, which management believes will not have a material adverse effect on its financial position - The company is involved in various legal matters from the ordinary course of business but does not expect them to have a material adverse effect on its financials[162](index=162&type=chunk) [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - No material changes have occurred in the risk factors discussed in the company's Annual Report[163](index=163&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2022, the company did not repurchase any shares under its publicly announced share repurchase program, but acquired 502 shares from employees to satisfy tax withholding obligations Share Repurchase Activity for Q2 2022 | Period | Total Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Publicly Announced Program | | :--- | :--- | :--- | :--- | | April 1 - April 30 | — | $ — | — | | May 1 - May 31 | 502 | $98.02 | — | | June 1 - June 30 | — | $ — | — | | **Total** | **502** | **$98.02** | **—** | - The **502 shares** purchased were from employees to pay required withholding taxes related to the settlement of restricted stock units[164](index=164&type=chunk) [Exhibits](index=33&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including officer certifications and the financial statements formatted in iXBRL

ICF International, Inc. (NASDAQ:ICFI) Q1 2022 Earnings Conference Call May 4, 2022 4:30 PM ET Company Participants David Gold - Investor Relations John Wasson - Chairman of the Board, President & Chief Executive Officer Barry Broadus - Senior Vice President & Chief Financial Officer Conference Call Participants Jasper Bibb - Truist Securities Joseph Vafi - Canaccord Genuity Operator Welcome to the First Quarter 2022 ICF Earnings Conference Call. My name is Vanessa and I will be your operator for today's cal ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section details the company's financial statements, management's analysis, market risk, and internal controls for the period [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) For the first quarter of 2022, ICF International, Inc. reported total revenue of $413.5 million, a 9.2% increase year-over-year, but net income slightly decreased to $17.9 million from $18.4 million in Q1 2021 [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) This statement provides a snapshot of the company's financial position, including assets, liabilities, and equity, at the end of the period Consolidated Balance Sheet Highlights (Unaudited) | (in thousands) | March 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $7,392 | $8,254 | | Contract receivables, net | $205,827 | $237,684 | | Goodwill | $1,045,503 | $1,046,760 | | Total Assets | $1,857,723 | $1,849,534 | | **Liabilities & Equity** | | | | Total Current Liabilities | $344,211 | $376,631 | | Long-term debt | $449,776 | $411,605 | | Total Liabilities | $1,054,421 | $1,046,064 | | Total Stockholders' Equity | $803,302 | $803,470 | [Consolidated Statements of Comprehensive Income](index=4&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) This statement details the company's revenues, expenses, and net income, along with other comprehensive income, for the reporting period Consolidated Statements of Comprehensive Income (Unaudited) | (in thousands, except per share amounts) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Revenue | $413,468 | $378,478 | | Operating income | $27,703 | $28,129 | | Net income | $17,862 | $18,351 | | Diluted Earnings per Share | $0.94 | $0.96 | | Comprehensive income, net of tax | $20,521 | $21,131 | [Consolidated Statements of Cash Flows](index=5&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This statement presents the cash inflows and outflows from operating, investing, and financing activities during the period Consolidated Statements of Cash Flows (Unaudited) | (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net Cash (Used in) Provided by Operating Activities | $(7,055) | $4,961 | | Net Cash Used in Investing Activities | $(6,454) | $(3,595) | | Net Cash Provided by (Used in) Financing Activities | $2,674 | $(33,275) | | Decrease in Cash, Cash Equivalents, and Restricted Cash | $(11,360) | $(31,164) | [Notes to Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the consolidated financial statements - The company provides professional services and technology solutions to government (U.S. federal, state, local, and international) and commercial clients across four main markets: energy/environment, health/education, safety/security, and consumer/financial[17](index=17&type=chunk)[18](index=18&type=chunk) - As of March 31, 2022, the company had **$461.6 million** of long-term debt outstanding under its Credit Facility, with an available borrowing capacity of **$250.4 million** after performance-based limitations[33](index=33&type=chunk) - The company repurchased **176,375 shares** for **$17.0 million** in Q1 2022. As of March 31, 2022, **$111.9 million** remained available for share repurchases under the authorized program[65](index=65&type=chunk) - The company is involved in a legal proceeding with the State of Louisiana regarding the Road Home Program, with the state seeking approximately **$220.2 million**. The company believes the claim has no merit and has not recorded a liability[70](index=70&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In Q1 2022, revenue grew 9.2% to $413.5 million, driven by strong performance in U.S. federal and state government client markets, particularly in health, education, and social programs [Overview and Outlook](index=19&type=section&id=Overview%20and%20Outlook) This section outlines the company's business model, strategic focus, and the impact of external factors like the ongoing pandemic on operations - The company operates as a single segment providing professional services to government and commercial clients in four key markets: Energy, Environment, and Infrastructure; Health, Education, and Social Programs; Safety and Security; and Consumer and Financial[76](index=76&type=chunk)[77](index=77&type=chunk) - Long-term demand is expected to grow, driven by societal issues like clean energy, health promotion, and disaster relief. The company's strategy focuses on larger engagements, leveraging digital capabilities, and strategic acquisitions[78](index=78&type=chunk)[79](index=79&type=chunk) - The COVID-19 pandemic continues to pose uncertainty, but the company has maintained operational continuity, with government clients (**75% of Q1 2022 revenue**) largely continuing services. Commercial marketing services, representing **7% of revenue**, remain impacted by travel restrictions[82](index=82&type=chunk)[83](index=83&type=chunk)[84](index=84&type=chunk) [Results of Operations](index=21&type=section&id=Results%20of%20Operations) This section analyzes the changes in revenue, direct costs, operating income, and net income for the reporting period Q1 2022 vs Q1 2021 Performance | (dollars in thousands) | Q1 2022 | Q1 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | $413,468 | $378,478 | $34,990 | 9.2% | | Direct Costs | $258,158 | $232,082 | $26,076 | 11.2% | | Operating Income | $27,703 | $28,129 | $(426) | (1.5%) | | Net Income | $17,862 | $18,351 | $(489) | (2.7%) | - Revenue increased by **$35.0 million (9.2%)**, primarily driven by growth in U.S. federal government's health, education, and social programs (**$39.4 million**) and U.S. state and local government's health programs (**$7.4 million**)[95](index=95&type=chunk) - Direct costs increased **11.2%** to **$258.2 million**, outpacing revenue growth, due to higher direct labor and subcontractor costs. Direct costs as a percentage of revenue rose to **62.4%** from **61.3%**[96](index=96&type=chunk) - Amortization of intangible assets increased by **76.4%** to **$5.3 million**, mainly due to the acquisitions of ESAC and Creative Systems and Consulting in late 2021[99](index=99&type=chunk) [Non-GAAP Measures](index=23&type=section&id=Non-GAAP%20Measures) This section provides reconciliations of GAAP financial measures to non-GAAP metrics such as Adjusted EBITDA and Non-GAAP EPS Reconciliation of Net Income to Adjusted EBITDA | (in thousands) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net income | $17,862 | $18,351 | | EBITDA | $37,858 | $36,414 | | Total special charges and adjustments | $4,427 | $1,313 | | **Adjusted EBITDA** | **$42,285** | **$37,727** | Reconciliation of Diluted EPS to Non-GAAP EPS | | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Diluted EPS | $0.94 | $0.96 | | Amortization of intangibles | $0.28 | $0.16 | | Special charges & other adjustments | $0.23 | $0.07 | | Income tax effects | $(0.14) | $(0.06) | | **Non-GAAP EPS** | **$1.31** | **$1.13** | [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) This section details the company's cash position, debt levels, borrowing capacity, and share repurchase activities - The company's primary source of borrowing is its Credit Facility, which had **$250.4 million** of available capacity as of March 31, 2022, after accounting for performance-based limitations[121](index=121&type=chunk) - Days-Sales-Outstanding (DSO) was **79 days** for Q1 2022, compared to **80 days** for Q1 2021. Excluding the slower-paying Puerto Rico disaster relief work, DSO was **74 days** versus **70 days** in the prior year[127](index=127&type=chunk) - Operating activities used **$7.1 million** in cash in Q1 2022, a decrease of **$12.1 million** from the **$5.0 million** provided in Q1 2021, primarily due to a net decrease in billings and collections[139](index=139&type=chunk) - Financing activities provided **$2.7 million** in cash, reflecting **$38.0 million** in net advances from the Credit Facility, offset by **$22.3 million** for stock buybacks and **$2.6 million** for dividends[141](index=141&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes in its market risk disclosures from those detailed in its most recent Annual Report on Form 10-K - There have been no material changes in the disclosures regarding market risk from the company's Annual Report[143](index=143&type=chunk) [Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of the end of the period - Based on an evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the period covered by the report[144](index=144&type=chunk) - There were no significant changes in internal controls over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[144](index=144&type=chunk) [PART II. OTHER INFORMATION](index=30&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section includes disclosures on legal proceedings, updated risk factors, equity sales, and a list of filed exhibits [Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal matters arising in the ordinary course of business but does not currently believe that any ultimate liability from these proceedings will have a material adverse effect on its financial position, results of operations, or cash flows - The company is involved in various legal matters from the ordinary course of business, which are not expected to have a material adverse effect on its financial results[148](index=148&type=chunk) [Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - No material changes have occurred in the risk factors discussed in the company's Annual Report[149](index=149&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first quarter of 2022, the company repurchased a total of 226,775 shares at an average price of $95.76 per share Share Repurchase Activity for Q1 2022 | Period | Total Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Program | | :--- | :--- | :--- | :--- | | January | 147,032 | $99.26 | 129,765 | | February | 10,435 | $93.33 | 10,435 | | March | 69,308 | $88.71 | 36,175 | | **Total** | **226,775** | **$95.76** | **176,375** | - The current share repurchase program authorizes up to **$200.0 million** in repurchases. During Q1 2022, the company repurchased **176,375 shares** under this program[151](index=151&type=chunk) [Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial statements formatted in iXBRL - The report includes certifications from the Principal Executive Officer and Principal Financial Officer, as well as financial data formatted in Inline eXtensible Business Reporting Language (iXBRL)[156](index=156&type=chunk)

ICF International, Inc. (NASDAQ:ICFI) Q4 2021 Results Conference Call February 24, 2022 4:30 PM ET Company Participants Lynn Morgen - Founding Partner, AdvisIRy Partners, IR John Wasson - Chairman, President & CEO Bettina Welsh - CFO James Morgan - Chief of Business Operations Barry Broadus - Incoming CFO Conference Call Participants Joseph Vafi - Canaccord Jasper Bibb - Truist Securities Marc Riddick - Sidoti Operator Welcome to the Q4 and Full Year 2021 ICF Earnings Conference Call. My name is Cheryl, and ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period From to Commission File Number: 001-33045 ICF INTERNATIONAL, INC. (Exact name of Registrant as specified in its charter) Delaware 22-3661438 (State or other jurisdictio ...