StockSelector.com
  Research, Select, & Monitor Sunday, August 18, 2019 7:36:30 AM ET  
Trade Ideas The Market Industries Stocks Portfolio

 
Ticker Lookup
MAXIMUS, Inc.$77.37$1.451.91%

  Quote | Ranking | Chart | Valuations | Sentiment | Industry | News | Earnings | Analysts | More...

Your Target?

 MAXIMUS Reports Fourth Quarter and Full Year Results for Fiscal Year 2017
   Thursday, November 09, 2017 6:30:03 AM ET

MAXIMUS (MMS ), a leading provider of government services worldwide, today reported financial results for the three months and year ended September 30, 2017.

Highlights for fiscal year 2017 include:

-- Revenue growth of 2% to $2.45 billion

-- GAAP diluted earnings per share of $3.17, which includes $0.14 of incremental tax benefits; excluding this benefit, adjusted diluted earnings per share were $3.03

-- Total company operating margin of 12.8%

-- Cash and cash equivalents that totaled $166.3 million at September 30, 2017

-- Record cash generation with cash provided by operating activities totaling $337.2 million and free cash flow of $313.0 million

-- Adjusted EBITDA of $400.6 million

-- Signed year-to-date contract awards of $2.84 billion, new contracts pending (awarded, but unsigned) of $1.27 billion, and a sales pipeline of $2.39 billion at September 30, 2017

Revenue for the fourth quarter of fiscal 2017 of $620.9 million was comparable to the same period last year. Revenue was slightly better than expected due to strong delivery in the Health Services Segment and a higher level of pass-through revenue from the Company’s Australian operations in the Human Services Segment.

For the fourth quarter of fiscal 2017, net income attributable to MAXIMUS totaled $53.3 million, or $0.81 of diluted earnings per share, which was better than expected primarily due to a lower income tax rate in the quarter. This compares to diluted earnings per share of $0.77 for the fourth quarter of fiscal 2016.

Revenue for fiscal 2017 increased 2% (3% on a constant currency basis) to $2.45 billion, compared to $2.40 billion reported for fiscal 2016. The increase in revenue was driven by organic growth in our Health Services Segment, partially offset by the expected declines from a subcontract that ended in the Federal Services Segment.

Total company operating margin for fiscal 2017 was strong and increased 90 basis points to 12.8% compared to fiscal 2016.

For fiscal 2017, net income attributable to MAXIMUS totaled $209.4 million, or $3.17 of GAAP diluted earnings per share. Fiscal 2017 diluted earnings per share benefited by approximately $0.14 due to a combination of tax benefits from larger-than-expected tax deductions from stock-related compensation, as well as research and development tax credits from prior years. Excluding the $0.14 in tax benefits, adjusted diluted earnings per share were $3.03 for fiscal 2017.

Health Services Segment

Health Services Segment revenue for the fourth quarter of fiscal 2017 increased 4% (4% on a constant currency basis) to $355.3 million, compared to $342.1 million reported for the same period last year. Operating income for the fourth quarter totaled $57.0 million (16.0% operating margin), compared to $50.9 million (14.9% operating margin) for the same period last year.

For the full fiscal year, Health Services Segment revenue increased 6% (9% on a constant currency basis) to $1.38 billion, compared to $1.30 billion for the same period last year. The majority of the revenue growth was organic, with less than 1% from acquired growth. Fiscal 2017 operating income totaled $215.2 million (15.6% operating margin), compared to operating income of $185.0 million (14.3% operating margin) for fiscal 2016.

The increase in revenue for the fourth quarter and the full fiscal year was driven primarily by the expansion of existing contracts and, to a lesser extent, new work. Operating margin expansion in the quarter and full year was principally due to the expected year-over-year service level improvements on a large contract in the U.K. and accretive revenue growth.

U.S. Federal Services Segment

As expected, U.S. Federal Services Segment revenue for the fourth quarter of fiscal 2017 decreased 13% to $127.3 million, compared to $146.7 million reported for the same period last year. Operating income for the fourth quarter totaled $13.6 million (10.7% operating margin), compared to $18.6 million (12.7% operating margin) for the same period last year.

For the full fiscal year, U.S. Federal Services Segment revenue decreased 8% to $545.6 million, compared to $591.7 million for the same period last year. Fiscal 2017 operating income totaled $65.0 million (11.9% operating margin), compared to operating income of $63.4 million (10.7% operating margin) for fiscal 2016.

The decrease in revenue for the fourth quarter and the full fiscal year was predominantly driven by a large subcontract that came to an end in April 2017 for work performed for the U.S. Department of Veterans Affairs. Revenue contribution from this contract was $63 million lower in fiscal 2017 compared to fiscal 2016. Operating margin expansion for fiscal 2017 improved 120 basis points over the prior year to 11.9%. This was primarily due to contract mix as a result of increased revenue from performance-based contracts.

Human Services Segment

Human Services Segment revenue for the fourth quarter of fiscal 2017 increased 3% (1% on a constant currency basis) to $138.2 million, compared to $134.3 million for the same period last year. Operating income for the fourth quarter totaled $10.8 million (7.8% operating margin), compared to $14.5 million (10.8% operating margin) for the same period last year.

For the full fiscal year, Human Services Segment revenue increased 2% (3% on a constant currency basis) to $525.2 million, compared to $513.3 million for the same period last year. Fiscal 2017 operating income totaled $48.6 million (9.2% operating margin), compared to operating income of $47.7 million (9.3% operating margin) for fiscal 2016.

The increase in revenue for the fourth quarter and the full fiscal year was principally driven by a higher level of pass-through revenue in the Company’s Australian operations, which was partially offset by the expected revenue decline from the U.K. Work Programme, which is coming to an end. Operating margins in the quarter and full fiscal year were lower than the same periods last year due to the aforementioned pass-through revenue in Australia and the decline from the U.K. Work Programme.

Backlog, Sales and Pipeline

Backlog was $5.70 billion at September 30, 2017. During the fourth quarter, the Company signed approximately $1 billion of contract awards, which brings the year-to-date total of signed contract awards to $2.84 billion at September 30, 2017. During the fourth quarter, the Company received notification of another $1 billion in pending contract awards, which brings the total value of new contracts pending (awarded but unsigned) to $1.27 billion.

The sales pipeline at September 30, 2017 was approximately $2.39 billion (comprised of approximately $623.8 million in proposals pending, $544.5 million in proposals in preparation and $1.23 billion in opportunities tracking). The pipeline is lower compared to the third quarter of fiscal 2017 due to the high level of contracts that converted into new awards. During the fourth quarter, the Company backfilled its pipeline with just under $1 billion in new opportunities. The Company’s sales pipeline only reflects those opportunities where MAXIMUS expects the request for proposal will be released within the next six months.

Balance Sheet and Cash Flows

Cash and cash equivalents at September 30, 2017 totaled $166.3 million. For the fourth quarter of fiscal 2017, cash provided by operating activities totaled $85.1 million, with free cash flow of $80.0 million. For fiscal 2017, the Company had record cash generation with cash provided by operations totaling $337.2 million and free cash flow of $313.0 million. Adjusted EBITDA, as defined by the Company, was $400.6 million.

At September 30, 2017, days sales outstanding (DSO) were 63 days, and better than the Company’s stated range of 65 to 80 days. Low DSO resulted from strong cash collections in the quarter.

On August 31, 2017, MAXIMUS paid a quarterly cash dividend of $0.045 per share. On October 6, 2017, the Company announced a $0.045 per share cash dividend, payable on November 30, 2017 to shareholders of record on November 15, 2017.

For the full fiscal year, MAXIMUS repurchased approximately 558,000 shares for $28.9 million (a weighted average price of $51.73). As of September 30, 2017, the Company had $109.9 million available for repurchases under its Board-authorized share repurchase program.

Outlook

MAXIMUS is establishing fiscal 2018 guidance. The Company expects fiscal 2018 revenue to range between $2.475 billion and $2.550 billion. Approximately 94% of the Company’s fiscal 2018 forecasted revenue is in the form of backlog, option periods or extensions.

For fiscal 2018, the Company expects GAAP diluted earnings per share to range between $2.95 and $3.15, which includes the detrimental impacts from new contracts in startup in the Human Services Segment. The Company estimates that these startups will have an unfavorable impact on pre-tax income of approximately $11 million to $13 million, or approximately $0.12 diluted earnings per share. Excluding this $0.12, fiscal 2018 adjusted diluted earnings per share is expected to range between $3.07 and $3.27. This compares to fiscal 2017 adjusted diluted earnings per share of $3.03. An accompanying supplemental table is included at the end of this press release.

The contracts that are in startup in fiscal 2018 have outcomes-based payments, which take time to achieve. Accordingly, no outcomes-based payments will occur in the early months of these contracts, but are expected to grow over time. Once mature, the Company expects these contracts to have a steady flow of outcomes-based payments.

For fiscal 2018, the Company has estimated its income tax rate will range between 35% and 36% and weighted average shares outstanding of approximately 66.5 million.

Richard Montoni, Chief Executive Officer of MAXIMUS, commented, "The overall results for fiscal year 2017 reflect our healthy portfolio of contracts, solid operating margins and record cash generation. The new contracts and successful rebids we achieved this fiscal year help to protect our base and provide paths to long-term growth. We believe demand for our services will continue over the long-term. The macro drivers remain robust as governments around the world seek solutions to address rising caseloads, meet the needs of aging populations, and manage social benefit programs in a cost-effective manner."

Accounting Standards Update Adopted in Fiscal Year 2017

The Company adopted ASU No. 2016-09, Stock Compensation, Improvements to Employee Share-Based Payment Accounting in fiscal year 2017. This standard requires companies to record the income tax benefit or expense related to the exercising of stock options and the vesting of restricted stock units (RSUs) as a reduction to the provision for income taxes. The amount of the benefit depends on the Company’s stock price on the exercise or vesting date. Most of the benefit for MAXIMUS in fiscal year 2017 arose in the fourth quarter. The Company anticipates recording the effect of equity award vestings in the fourth quarter of every fiscal year.

Website Presentation, Conference Call and Webcast Information

MAXIMUS will host a conference call this morning, November 9, 2017, at 9:00 a.m. (ET). The call is open to the public and can be accessed under the Investor Relations page of the Company’s website at http://investor.maximus.com or by calling:

877.407.8289 (Domestic)/+1.201.689.8341 (International)

For those unable to listen to the live call, a replay will be available through November 23, 2017 by calling:

877.660.6853 (Domestic)/+1.201.612.7415 (International) Replay conference ID number: 13672051

About MAXIMUS

Since 1975, MAXIMUS has operated under its founding mission of Helping Government Serve the People(R), enabling citizens around the globe to successfully engage with their governments at all levels and across a variety of health and human services programs. MAXIMUS delivers innovative business process management and technology solutions that contribute to improved outcomes for citizens and higher levels of productivity, accuracy, accountability and efficiency of government-sponsored programs. With more than 20,000 employees worldwide, MAXIMUS is a proud partner to government agencies in the United States, Australia, Canada, Saudi Arabia, Singapore and the United Kingdom. For more information, visit maximus.com.

Non-GAAP and Other Measures

This release refers to non-GAAP financial measures, including free cash flow, constant currency, days sales outstanding and adjusted EBITDA.

We have provided a reconciliation of free cash flow to cash provided by operating activities. We believe that free cash flow is a useful basis for investors to compare our performance across periods or against our competitors. Free cash flow shows the effects of the Company’s operations and routine capital expenditure and excludes the cash flow effects of acquisitions, share repurchases, dividend payments and other financing transactions.

To provide constant currency information, we calculate fiscal year 2017 revenue for all international businesses using the exchange rates used in the comparative period in fiscal year 2016. We believe constant currency provides a useful basis for assessing the performance of the business excluding the unpredictable effects of foreign exchange fluctuations.

Days sales outstanding, or DSO, is a measure of how efficiently we manage the billing and collection of our receivable balances. We calculate DSO by dividing billed and unbilled receivable balances at the end of each quarter by revenue per day for the period. Revenue per day for a quarter is determined by dividing total revenue by 91 days.

We have provided a reconciliation from net income to adjusted EBITA and adjusted EBITDA. During fiscal year 2017, we utilized our credit facility. Our credit agreement includes the defined term consolidated EBITDA and our calculation of adjusted EBITDA conforms to the credit agreement definition. We believe our investors appreciate the opportunity to understand the possible restrictions that arise from our credit agreement. Adjusted EBITDA is also a useful measure of performance that focuses on the cash generating capacity of the business as it excludes the non-cash expenses of depreciation and amortization, and makes for easier comparisons between the operating performance of companies with different capital structures by excluding interest expense and therefore the impacts of financing costs. The measure of adjusted EBITA is a step in calculating adjusted EBITDA and facilitates comparisons to similar businesses as it isolates the amortization effect of business combinations.

To assist users of our financial statements in understanding our projections for fiscal year 2018 compared to our results for 2017, we have adjusted our diluted earnings per share. Our fiscal year 2017 results include tax effects that are not anticipated to be as large in future periods. Our fiscal year 2018 projections include the detrimental impact from the startup of new contracts. In fiscal 2018, we expect the detrimental impact from these ups will be higher than those in 2017. By adjusting our diluted earnings per share totals for 2017 and 2018, we are assisting users of our financial statements in understanding the key drivers in our anticipated 2018 results compared to our 2017 results.

The presentation of these non-GAAP numbers is not meant to be considered in isolation, nor as alternatives to cash flows from operating activities, revenue growth or net income as measures of performance. These non-GAAP financial measures, as determined and presented by us, may not be comparable to related or similarly titled measures presented by other companies.

Statements that are not historical facts, including statements about the Company’s confidence and strategies and the Company’s expectations about revenues, results of operations, profitability, future contracts, market opportunities, market demand or acceptance of the Company’s products are forward-looking statements that involve risks and uncertainties. These risks could cause the Company’s actual results to differ materially from those indicated by such forward-looking statements. A summary of risk factors can be found in Exhibit 99.1 to the Company’s most recent Annual Report filed with the Securities and Exchange Commission, found on maximus.com.

 
                                                                                                                                                                        MAXIMUS, Inc.
                                                                                                                                                                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                                                                                                                                                  (Amounts in thousands, except per share data)
 
                                                                                                   Three Months Ended September 30,                                                                              Twelve Months Ended September 30,
                                                                                                                  --------------------------------------------------------------------------------------------------------------------                                          ------------------------------------------------------------------------------------------------
                                                                                                                                  2017                                     2016                                                                           2017                           2016
                                                                                                                  -------------------------------------                                          -------------------------------------                                          ------------------------------------                                          ------------------
                                                                                                                               (Unaudited)                                                                    (Unaudited)                                                                    (Unaudited)
Revenue                                                                                                                 $ 620,903                                                                      $ 623,091                                                                   $ 2,450,961                                                                      $ 2,403,360
Cost of revenue                                                                                                           458,322                                                     470,161                                                  1,839,056                                                     1,841,169
                                                                                                                  ------------------------------------                                           ------------------------------------                                           -----------------------------------                                           ------------------
   Gross profit                                                                                                           162,581                                                                        152,930                                                                       611,905                                                                          562,191
Less:
   Selling, general and administrative expenses                                                                            82,208                                                                         68,343                                                                       284,510                                                                          268,259
   Amortization of intangible assets                                                                                        2,700                                                                          3,449                                                                        12,208                                                                           13,377
   Restructuring costs                                                                                             --                                                                 --                                                                         2,242                                                                   --
   Acquisition-related expenses                                                                                                83                                                                            257                                                                            83                                                                              832
Add:
   Gain on sale of a business                                                                                      --                                                         427                                                        650                                                         6,880
                                                                                                                  ------------------------------------                                           ------------------------------------                                           -----------------------------------                                           ------------------
      Operating income                                                                                                     77,590                                                                         81,308                                                                       313,512                                                                          286,603
Less:
   Interest expense                                                                                                           111                                                                            843                                                                         2,162                                                                            4,134
Add:
   Other income, net                                                                                                          899                                                          97                                                      2,885                                                         3,499
                                                                                                                  ------------------------------------                                           ------------------------------------                                           -----------------------------------                                           ------------------
      Income before income taxes                                                                                           78,378                                                                         80,562                                                                       314,235                                                                          285,968
Provision for income taxes                                                                                                 23,410                                                      29,375                                                    102,053                                                       105,808
                                                                                                                  ------------------------------------                                           ------------------------------------                                           -----------------------------------                                           ------------------
   Net income                                                                                                              54,968                                                                         51,187                                                                       212,182                                                                          180,160
Income attributable to noncontrolling interests                                                                             1,639                                                         444                                                      2,756                                                         1,798
                                                                                                                  ------------------------------------                                           ------------------------------------                                           -----------------------------------                                           ------------------
   Net income attributable to MAXIMUS                                                                                   $  53,329                                                   $  50,743                                                $   209,426                                                   $   178,362
                                                                                                                  ======= ======= ====================                                           ======= ======= ====================                                           ==== ========= ====================                                           ======= =========
Basic earnings per share attributable to MAXIMUS                                                                        $    0.81                                                                      $    0.77                                                                   $      3.19                                                                      $      2.71
Diluted earnings per share attributable to MAXIMUS                                                                      $    0.81                                                                      $    0.77                                                                   $      3.17                                                                      $      2.69
Dividends paid per share                                                                                                $   0.045                                                   $   0.045                                                $      0.18                                                   $      0.18
                                                                                                                  ======= ======= ====================                                           ======= ======= ====================                                           ==== ========= ====================                                           ======= =========
Weighted average shares outstanding:
   Basic                                                                                                                   65,618                                                      65,778                                                     65,632                                                        65,822
                                                                                                                  ====================================                                           ====================================                                           ===================================                                           ==================
   Diluted                                                                                                                 66,171                                                      66,294                                                     66,065                                                        66,229
                                                                                                                  ====================================                                           ====================================                                           ===================================                                           ==================
 
 
                                                                                                         MAXIMUS, Inc.
                                                                                                            CONSOLIDATED BALANCE SHEETS
                                                                                                              (Amounts in thousands)
 
                                                                                                                           September 30,
                                                                                                                                  ----------------------------------------------------------------------------------------------------------------
                                                                                                                                                 2017                                   2016
                                                                                                                                  -----------------------------------                                          -----------------------------------
                                                                                                                                              (Unaudited)
                              ASSETS
Current assets:
   Cash and cash equivalents                                                                                                        $   166,252                                                                  $    66,199
   Accounts receivable -- billed and billable                                                                               394,338                                                                      444,357
   Accounts receivable -- unbilled                                                                                           36,475                                                                       36,433
   Income taxes receivable                                                                                                                4,528                                                                       17,273
   Prepaid expenses and other current assets                                                                                             55,649                                                    56,718  
                                                                                                                                  ----------------------------------                                           ----------------------------------
                                                                                                                                        657,242                                                                      620,980
     Total current assets
Property and equipment, net                                                                                                             101,651                                                                      131,569
Capitalized software, net                                                                                                                26,748                                                                       30,139
Goodwill                                                                                                                                402,976                                                                      397,558
Intangible assets, net                                                                                                                   98,769                                                                      109,027
Deferred contract costs, net                                                                                                             16,298                                                                       18,182
Deferred compensation plan assets                                                                                                        28,548                                                                       23,307
Deferred income taxes                                                                                                                     7,691                                                                        8,644
Other assets                                                                                                                             10,739                                                     9,413  
                                                                                                                                  ----------------------------------                                           ----------------------------------
   Total assets                                                                                                                     $ 1,350,662                                               $ 1,348,819  
                                                                                                                                  === ========= ====================                                           === ========= ====================
  LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
   Accounts payable and accrued liabilities                                                                                         $   122,083                                                                  $   150,711
   Accrued compensation and benefits                                                                                                    105,667                                                                       96,480
   Deferred revenue                                                                                                                      71,722                                                                       73,692
   Income taxes payable                                                                                                                   4,703                                                                        7,979
   Long-term debt, current portion                                                                                                          141                                                                          277
   Other liabilities                                                                                                                     11,950                                                    11,617  
                                                                                                                                  ----------------------------------                                           ----------------------------------
      Total current liabilities                                                                                                         316,266                                                                      340,756
Deferred revenue, less current portion                                                                                                   28,182                                                                       40,007
Deferred income taxes                                                                                                                    20,106                                                                       16,813
Long-term debt                                                                                                                              527                                                                      165,338
Deferred compensation plan liabilities, less current portion                                                                             30,707                                                                       24,012
Other liabilities                                                                                                                         9,106                                                     8,753  
                                                                                                                                  ----------------------------------                                           ----------------------------------
   Total liabilities                                                                                                                    404,894                                                                      595,679
Commitments and contingencies
Shareholders’ equity:
   Common stock                                                                                                                         475,592                                                                      461,679
   Accumulated other comprehensive income                                                                                               (27,619 )                                                                    (36,169 )
   Retained earnings                                                                                                                    492,112                                                   323,571  
                                                                                                                                  ----------------------------------                                           ----------------------------------
     Total MAXIMUS shareholders’ equity                                                                      940,085                                                                      749,081
   Noncontrolling interests                                                                                                               5,683                                                     4,059  
                                                                                                                                  ----------------------------------                                           ----------------------------------
     Total equity                                                                                                                       945,768                                                   753,140  
                                                                                                                                  ----------------------------------                                           ----------------------------------
     Total liabilities and equity                                                                                                   $ 1,350,662                                               $ 1,348,819  
                                                                                                                                  === ========= ====================                                           === ========= ====================
 
 
                                                                                                                                                                                           MAXIMUS, Inc.
                                                                                                                                                                                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                                                                                                                                                (Amounts in thousands)
 
                                                                                                                      Three Months Ended September 30,                                                                                       Twelve Months Ended September 30,
                                                                                                                                     --------------------------------------------------------------------------------------------------------------------                                          -------------------------------------------------------------------------------------------------------------------
                                                                                                                                                     2017                                     2016                                                                           2017                                     2016
                                                                                                                                     -------------------------------------                                          -------------------------------------                                          -------------------------------------                                          ------------------------------------
                                                                                                                                                  (Unaudited)                                                                    (Unaudited)                                                                    (Unaudited)
Cash flows from operating activities:
Net income                                                                                                                                 $  54,968                                                                      $  51,187                                                                      $ 212,182                                                                     $ 180,160
Adjustments to reconcile net income to net cash provided by
operating activities:
   Depreciation and amortization of property, plant, equipment and                                                                            12,353                                                                         19,158                                                                         55,769                                                                        58,404
   capitalized software
   Amortization of intangible assets                                                                                                           2,700                                                                          3,449                                                                         12,208                                                                        13,377
   Deferred income taxes                                                                                                                      (3,852 )                                                                        7,399                                                                          4,762                                                                         5,652
   Stock compensation expense                                                                                                                  5,543                                                                          4,933                                                                         21,365                                                                        18,751
   Gain on sale of a business                                                                                                         --                                                                           (427 )                                                                         (650 )                                                                      (6,880 )
Changes in assets and liabilities, net of effects of business
combinations:
   Accounts receivable -- billed and billable                                                                                    (14,998 )                                                                      (24,517 )                                                                       53,025                                                                       (51,986 )
   Accounts receivable -- unbilled                                                                                                 7,293                                                                            (34 )                                                                           26                                                                        (5,590 )
   Prepaid expenses and other current assets                                                                                                  (3,360 )                                                                       (6,405 )                                                                        2,584                                                                        (2,027 )
   Deferred contract costs                                                                                                                       923                                                                         (1,354 )                                                                        2,037                                                                          (398 )
   Accounts payable and accrued liabilities                                                                                                    9,104                                                                         18,246                                                                        (28,309 )                                                                      (2,371 )
   Accrued compensation and benefits                                                                                                          10,552                                                                          9,105                                                                          8,849                                                                          (869 )
   Deferred revenue                                                                                                                              869                                                                             42                                                                        (15,401 )                                                                     (11,661 )
   Income taxes                                                                                                                                3,531                                                                        (12,160 )                                                                        8,901                                                                       (13,125 )
   Other assets and liabilities                                                                                                                 (523 )                                                                        3,272                                                        (148 )                                                                      (1,411 )
                                                                                                                                     ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Cash provided by operating activities                                                                                                         85,103                                                                         71,894                                                                        337,200                                                                       180,026
                                                                                                                                                                                                                                                                                                                                                                                   
Cash flows from investing activities:
   Purchases of property and equipment and capitalized software costs                                                                         (5,066 )                                                                      (12,288 )                                                                      (24,154 )                                                                     (46,391 )
   Acquisition of businesses, net of cash acquired                                                                                            (2,677 )                                                                           85                                                                         (2,677 )                                                                     (46,651 )
   Proceeds from the sale of a business                                                                                               --                                                                 --                                                                          1,035                                                                         5,515
   Other                                                                                                                                          90                                                          43                                                         575                                                        424  
                                                                                                                                     ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Cash used in investing activities                                                                                                             (7,653 )                                                                      (12,160 )                                                                      (25,221 )                                                                     (87,103 )
                                                                                                                                                                                                                                                                                                                                                                                   
Cash flows from financing activities:
   Cash dividends paid                                                                                                                        (2,920 )                                                                       (2,921 )                                                                      (11,674 )                                                                     (11,701 )
   Repurchases of common stock                                                                                                        --                                                                 --                                                                        (28,863 )                                                                     (33,335 )
   Stock compensation tax benefit                                                                                                     --                                                                          5,172                                                                 --                                                                         5,172
   Tax withholding related to RSU vesting                                                                                                         92                                                                            (17 )                                                                       (9,175 )                                                                     (11,614 )
   Stock option exercises                                                                                                                        554                                                                            341                                                                            924                                                                           546
   Borrowings under credit facility                                                                                                           30,000                                                                         10,000                                                                        185,000                                                                       149,823
   Repayment under credit facility                                                                                                           (45,079 )                                                                      (55,383 )                                                                     (349,981 )                                                                    (195,200 )
   Other                                                                                                                                        (440 )                                                               --                                                      (1,660 )                                                                        (533 )
                                                                                                                                     ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Cash used in financing activities                                                                                                            (17,793 )                                                                      (42,808 )                                                                     (215,429 )                                                                     (96,842 )
                                                                                                                                                                                                                                                                                                                                                                                   
Effect of exchange rate changes on cash                                                                                                        2,217                                                      (1,336 )                                                                        3,503                                                     (4,554 )
                                                                                                                                     ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
                                                                                                                                                                                                                                                                                                                                                                                   
Net increase/(decrease) in cash and cash equivalents                                                                                          61,874                                                                         15,590                                                                        100,053                                                                        (8,473 )
                                                                                                                                                                                                                                                                                                                                                                                   
Cash and cash equivalents, beginning of period                                                                                               104,378                                                      50,609                                                      66,199                                                     74,672  
                                                                                                                                     ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
                                                                                                                                                                                                                                                                                                                                                                                   
Cash and cash equivalents, end of period                                                                                                   $ 166,252                                                   $  66,199                                                   $ 166,252                                                  $  66,199  
                                                                                                                                     ======= ======= ====================                                           ======= ======= ====================                                           ======= ======= ====================                                           ====== ======= ====================
 
 
                                                                                                                                                                                                                                     MAXIMUS, Inc.
                                                                                                                                                                                                                                     SEGMENT INFORMATION
                                                                                                                                                                                                                                     (Amounts in thousands)
 
                                                                                                                                               Three Months Ended September 30,                                                                                                                                                                                                  Twelve Months Ended September 30,
                                                                                                            ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                          ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         2017                       % (1)                     2016                       % (1)                                                          2017                      % (1)                      2016                              % (1)
--------------------------------------------                                                                -------------------------------------                                          --------                                          -------------------------------------                                          --------                                          -----------------------------------                                          --------                                          ---------------------------------------                                          ---------------------
                                                                                                                         (Unaudited)                                                                                                                      (Unaudited)                                                                                                                     (Unaudited)
Revenue:
Health Services                                                                                                   $ 355,338                                                                 100  %                                                 $ 342,135                                                                 100  %                                             $ 1,380,151                                                                 100  %                                                 $ 1,298,304                                                                       100         %
U.S. Federal Services                                                                                               127,316                                                                 100  %                                                   146,651                                                                 100  %                                                 545,573                                                                 100  %                                                     591,728                                                                       100         %
Human Services                                                                                                      138,249                                              100  %                                                   134,305                                              100  %                                                 525,237                                              100  %                                                     513,328                                                    100         %
                                                                                                            ------------------------------------                                                                                             ------------------------------------                                                                                             ----------------------------------                                                                                             --------------------------------------
   Total                                                                                                          $ 620,903                                              100  %                                                 $ 623,091                                              100  %                                             $ 2,450,961                                              100  %                                                 $ 2,403,360                                                    100         %
                                                                                                            ======= ======= ====================                                                                                             ======= ======= ====================                                                                                             === ========= ====================                                                                                             ======= ========= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
Gross Profit:
Health Services                                                                                                   $  99,368                                                                28.0  %                                                 $  80,717                                                                23.6  %                                             $   347,325                                                                25.2  %                                                 $   292,181                                                                      22.5         %
U.S. Federal Services                                                                                                31,547                                                                24.8  %                                                    37,529                                                                25.6  %                                                 139,321                                                                25.5  %                                                     138,168                                                                      23.3         %
Human Services                                                                                                       31,666                                             22.9  %                                                    34,684                                             25.8  %                                                 125,259                                             23.8  %                                                     131,842                                                   25.7         %
                                                                                                            ------------------------------------                                                                                             ------------------------------------                                                                                             ----------------------------------                                                                                             --------------------------------------
   Total                                                                                                          $ 162,581                                             26.2  %                                                 $ 152,930                                             24.5  %                                             $   611,905                                             25.0  %                                                 $   562,191                                                   23.4         %
                                                                                                            ======= ======= ====================                                                                                             ======= ======= ====================                                                                                             === ========= ====================                                                                                             ======= ========= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
Selling, general and administrative expense:
Health Services                                                                                                   $  42,344                                                                11.9  %                                                 $  29,843                                                                 8.7  %                                             $   132,081                                                                 9.6  %                                                 $   107,155                                                                       8.3         %
U.S. Federal Services                                                                                                17,966                                                                14.1  %                                                    18,971                                                                12.9  %                                                  74,345                                                                13.6  %                                                      74,792                                                                      12.6         %
Human Services                                                                                                       20,848                                                                15.1  %                                                    20,151                                                                15.0  %                                                  76,675                                                                14.6  %                                                      84,157                                                                      16.4         %
Other                                                                                                                 1,050                                                  NM                                                      (622 )                                                                   NM                                                   1,409                                                  NM                                                       2,155                                                               NM
                                                                                                            ------------------------------------                                                                                             ------------------------------------                                                                                             ----------------------------------                                                                                             --------------------------------------
   Total                                                                                                          $  82,208                                             13.2  %                                                 $  68,343                                             11.0  %                                             $   284,510                                             11.6  %                                                 $   268,259                                                   11.2         %
                                                                                                            ======= ======= ====================                                                                                             ======= ======= ====================                                                                                             === ========= ====================                                                                                             ======= ========= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
Operating income:
Health Services                                                                                                   $  57,024                                                                16.0  %                                                 $  50,874                                                                14.9  %                                             $   215,244                                                                15.6  %                                                 $   185,026                                                                      14.3         %
U.S. Federal Services                                                                                                13,581                                                                10.7  %                                                    18,558                                                                12.7  %                                                  64,976                                                                11.9  %                                                      63,376                                                                      10.7         %
Human Services                                                                                                       10,818                                                                 7.8  %                                                    14,533                                                                10.8  %                                                  48,584                                                                 9.2  %                                                      47,685                                                                       9.3         %
Amortization of intangible assets                                                                                    (2,700 )                                                                   NM                                                    (3,449 )                                                                   NM                                                 (12,208 )                                                                   NM                                                     (13,377 )                                                                                NM
Restructuring costs                                                                                          --                                                                     NM                                            --                                                                     NM                                                  (2,242 )                                                                   NM                                              --                                                                                  NM
Acquisition-related expenses (2)                                                                                        (83 )                                                                   NM                                                      (257 )                                                                   NM                                                     (83 )                                                                   NM                                                        (832 )                                                                                NM
Gain on sale of a business                                                                                   --                                                                     NM                                                       427                                                                     NM                                                     650                                                                     NM                                                       6,880                                                                                  NM
Other (3)                                                                                                            (1,050 )                                                                   NM                                                       622                                                  NM                                                  (1,409 )                                                                   NM                                                      (2,155 )                                                                                NM
                                                                                                            ------------------------------------                                                                                             ------------------------------------                                                                                             ----------------------------------                                                                                             --------------------------------------
   Total                                                                                                          $  77,590                                             12.5  %                                                 $  81,308                                             13.0  %                                             $   313,512                                             12.8  %                                                 $   286,603                                                   11.9         %
                                                                                                            ======= ======= ====================                                                                                             ======= ======= ====================                                                                                             === ========= ====================                                                                                             ======= ========= ====================
 
 
(1)       Percentage of respective segment revenue. Percentages considered not
                                                meaningful are marked "NM."
                                                 
(2)                                             Acquisition-related expenses are costs directly incurred from the
                                                purchases of Revitalised Limited in 2017 and Ascend Management
                                                Innovations, LLC (Ascend) and Assessments Australia in 2016.
                                                 
(3)                                             "Other" relates to various expenses which are not directly
                                                attributable to our segments, including litigation costs.
 
 
                                                                                                                                                             MAXIMUS, Inc.
                                                                                                                                                            FREE CASH FLOW
                                                                                                                                                          (Non-GAAP measure)
                                                                                                                                                        (Amounts in thousands)
                                                                                                                                                              (Unaudited)
 
                                                                                                          Three Months Ended                                                                        Twelve Months Ended
                                                                                                                                                                      September 30,                                                                                                September 30,
                                                                                                                                  ------------------------------------------------------------------------------                            -----------------------------------------------------------------------------------
                                                                                                                                                2017                              2016                                                 2017                                 2016
                                                                                                                                  --------------------------------                     --------------------------------                     ---------------------------------                     ------------------------------------
                                                                                                                                                                                                                                                                                                   
Cash provided by operating activities                                                                                               $ 85,103                                             $ 71,894                                             $ 337,200                                                $ 180,026
Purchases of property and equipment and capitalized software costs                                                                    (5,066 )                                            (12,288 )                                             (24,154 )                                                (46,391 )
                                                                                                                                  -------------------------------                      -------------------------------                      --------------------------------                      -----------------------------------
  Free cash flow                                                                                                                    $ 80,037                          $ 59,606                          $ 313,046                             $ 133,635  
                                                                                                                                  === ====== ====================                      === ====== ====================                      === ======= ====================                      ====== ======= ====================
 
 
                                                                                                                         ADJUSTED EBITDA
                                                                                                                       (Non-GAAP measure)
                                                                                                                     (Amounts in thousands)
                                                                                                                           (Unaudited)
 
                                                                                                                  Year ended September 30,
                                                                                                                                                    ------------------------------------------------------------------------------------------------------------
(in thousands)                                                                                                                                                    2017                                 2016
---------------------------------------------------------------                                                                                     ---------------------------------                                          ---------------------------------
Net income attributable to MAXIMUS                                                                                                                    $ 209,426                                                                  $ 178,362
Interest expense                                                                                                                                            379                                                                      3,466
Provision for income taxes                                                                                                                              102,053                                                                    105,808
Amortization of intangible assets                                                                                                                        12,208                                                                     13,377
Stock compensation expense                                                                                                                               21,365                                                                     18,751
Acquisition-related expenses                                                                                                                                 83                                                                        832
Gain on sale of a business                                                                                                                                 (650 )                                                                   (6,880 )
                                                                                                                                                    --------------------------------                                           --------------------------------
  Adjusted EBITA                                                                                                                                        344,864                                                                    313,716
Depreciation and amortization of property, plant, equipment and                                                                                          55,769                                                  58,404  
capitalized software
                                                                                                                                                    ----------  --------------------                                           ----------  --------------------
  Adjusted EBITDA                                                                                                                                     $ 400,633                                               $ 372,120  
                                                                                                                                                    === ======= ====================                                           === ======= ====================
 
 
                                                                                                                                                                                        MAXIMUS, Inc.
                                                                                                                                                                                     SUPPLEMENTAL TABLE
                                                                                                                                                                        (Amounts in millions, except per share data)
                                                                                                                                                                                         (Unaudited)
 
                                             FY17 Actual Results                                              FY18 Guidance                                                                                  Implied Year/Year Growth
                                                                                                                                                                                                                 Range
                                                                                                     -----------------                                                        ------------------------------------------------------------------                                         ----------------------------------------------------------------------------------------------
                                                                                                                                                                                  Low                      High                                                Low                             High
                                                                                                                                                                                                                                                                                                                                                              
Revenue                                                                                                   $  2,451                                                             $ 2,475                                                         $ 2,550                                       1%                                                     4%
                                                                                                                                                                                                                                                                                                                                                              
GAAP Operating Income                                                                                     $    314                                                             $   303                                                         $   324
Operating Margin %                                                                                            12.8 %                                                              12.2 %                                                          12.7 %
                                                                                                                                                                                                                                                                                                                                                              
GAAP Diluted Earnings Per Share (EPS)                                                                     $   3.17       (1)                                $  2.95   (2)                                $  3.15   (2)            (7)%                                                   (1)%
                                                                                                                                                                                                                                                                                                                                                              
FY17 Tax Benefits                                                                                         $  (0.14 )
FY18 Projected Startup Impacts (3)                                                                                                                                             $  0.12                                                         $  0.12
                                                                                                                                                                                                                                                                                                                                                              
Adjusted Diluted EPS                                                                                      $   3.03       (4)                                $  3.07                                                         $  3.27                                       1%                                                     8%
Implied Adjusted Operating Margin %                                                                           12.8 %                                                              12.7 %                                                          13.2 %
 
 
(1)       FY17 GAAP diluted EPS reflects a 32.5% tax rate.
                                                 
(2)                                             FY18 GAAP diluted EPS reflects a 35.5% tax rate.
                                                 
(3)                                             FY18 diluted EPS adjustments remove forecasted detrimental impacts
                                                to operating income (ranging from $11 million to $13 million)
                                                related to contracts in startup in the U.S., U.K. and Australia.
                                                 
(4)                                             FY17 diluted EPS adjustments exclude events in 2017 that will not
                                                occur to the same extent in 2018 (including research & development
                                                tax credits related to prior years and the application of ASU No.
                                                2016-09. The tax benefit of the application of ASU No. 2016-09 is
                                                much higher in 2017 than it is anticipated to be in 2018). The
                                                $0.14 benefit is calculated by using the estimated $10 million in
                                                tax savings, divided by the weighted average shares outstanding at
                                                September 30, 2017.
                                                 

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20171109005305r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20171109005305/en/

SOURCE: MAXIMUS

MAXIMUS 
Lisa Miles, 703-251-8637 
lisamiles@maximus.com


Register |  Password |  Feedback |  Copyright |  Usage Agreement |  Privacy Policy |  Advertising |  About Us |  Contact Us |  FAQ 

Past performance is not indicative of future results

StockSelector.com, the StockSelector.com logo, and News Selects are trademarks of StockSelector.com.
Copyright © 1998 - 2019 StockSelector.com. All rights reserved.