Financial Data and Key Metrics Changes - For fiscal year 2025, the company achieved revenue growth of 16% on an underlying basis, with an EBITDA margin of 11.2% and free cash flow of $442 million, reflecting a growth of over 16% per share [8][25][30] - In the fourth quarter, revenue reached $2.3 billion, representing a 13% year-over-year growth, with an EBITDA margin of 11.5% [23][25] - Adjusted diluted earnings per share for the fourth quarter were $8.4, a 27% increase from the previous year [23] Business Line Data and Key Metrics Changes - The company won $10 billion in contract awards for the fiscal year, resulting in a book-to-bill ratio of 1.1x [8][33] - The fiscal year 2025 saw a 10% organic growth in revenue, driven by strong customer demand for differentiated technology and expertise [25][30] Market Data and Key Metrics Changes - The company generates 90% of its revenue from national security customers, benefiting from favorable government funding trends, including $150 billion allocated for defense [18][30] - The company has a healthy pipeline with $16 billion in bids under evaluation, 80% of which are for new business [33] Company Strategy and Development Direction - The company has positioned itself in well-funded areas aligned with national security priorities, focusing on software-based capabilities and modernization [10][17] - The strategy emphasizes bidding on high-value opportunities rather than competing aggressively on price, with a focus on differentiated capabilities [44][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving fiscal year 2026 guidance, expecting revenue growth of nearly 8% and free cash flow per share growth of over 60% [20][30] - The company is closely monitoring the government fiscal year 2026 budget process, indicating resilience in operating under a continuing resolution [19][60] Other Important Information - The company completed three strategic acquisitions and repurchased $150 million of shares during the year [29] - The effective tax rate in the fourth quarter benefited from a $28 million tax resolution, which will positively impact future tax liabilities [23][27] Q&A Session Summary Question: Concerns about the competitive landscape and takeaway work - Management clarified that the majority of their pipeline consists of new work, with a focus on differentiated solutions rather than traditional government services [41][44] Question: Impact of ceiling reduction on iTask program - Management confirmed that the ceiling reduction does not affect revenue, margins, or guidance, and the program continues to execute well [48][50] Question: Outlook on federal civilian budget exposure - The company has minimal exposure to federal civilian work, focusing primarily on defense and intelligence sectors, which are more stable [98][100] Question: Software acquisition directive and its implications - Management views the software acquisition directive positively, anticipating increased opportunities for software solutions in government contracts [109][111] Question: Pipeline characterization and outcome-based pricing - Management indicated that their pipeline includes both new work to the market and new work to CACI, emphasizing their focus on delivering better solutions than competitors [116][118]
CACI(CACI) - 2025 Q4 - Earnings Call Transcript