earnings presentation - dlh investorroom · ew •generated $65.3m in revenue; grew 8.0% over prior...
TRANSCRIPT
EARNINGS PRESENTATION
FY 2015 Q4 and Annual Results
December 10, 2015
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Forward-Looking Statement
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:
This press release may contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements relate to future events or DLH`s future
financial performance. Any statements that are not statements of historical fact (including without
limitation statements to the effect that the Company or its management "believes", "expects",
"anticipates", "plans", “intends” and similar expressions) should be considered forward looking
statements that involve risks and uncertainties which could cause actual events or DLH`s actual
results to differ materially from those indicated by the forward-looking statements. For a discussion of
such risks and uncertainties, see “Risk Factors” in the company’s periodic reports filed with the SEC,
including our Annual Report on Form 10-K for the fiscal year ended September 30, 2015. In light of the
risks and uncertainties inherent in the forward-looking statements included herein, the inclusion of
such statements should not be regarded as a representation by the Company or any other person that
the objectives and plans of the Company will be achieved. The forward-looking statements contained
in this presentation are made as of the date hereof and may become outdated over time. The
Company does not assume any responsibility for updating any forward-looking statements.
© 2015 | DLH | Proprietary | FY15 Q4 Earnings 2
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Participants
Zachary Parker
President & Chief Executive Officer
Kathryn JohnBull
Chief Financial Officer
Casey Stegman, Stonegate Capital Partners
Investor Relations Advisor
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Business & Financial Overview
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• VA mail-order pharmacy client achieves JD Power
Award for highest rating
• Strong operating income and margin improvement
• Achieved 8% revenue growth over prior year
o Expansion on existing contracts and new opportunities
including telehealth
• DLH’s Team awarded Army Medical Product
Clinical Research and Development IDIQ contract
• DLH’s Team bid makes VA T4NG “down-select”
• Large addressable adjacent federal market
DLH FY2015 Executive Summary
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CE
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o Achieving performance excellence per KPIs
o Deploying capital for growth
o Bidding on $400M in new business opportunities (FY16-18)
o Resourcing to deliver bids within market sales-cycle
o Positioning for strategic acquisitions
DLH FY2015 Executive Summary – Cont’d
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• Generated $17M in revenue; grew 9.1% over prior year fourth
quarter
• Realized $3.4M of gross margin; improved 44.7% over prior year
fourth quarter
• Earned $1.0M operating income; increased $0.8M over prior
year fourth quarter
• Attained $1.0M Adjusted EBITDA; increased $0.7M over prior
year fourth quarter
• Adjusted EBITDA rate of return on revenue was 6.1% compared
to 2.1% for the prior year fourth quarter
FY2015 Financial Summary – 4th Quarter
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• Generated $65.3M in revenue; grew 8.0% over prior year
• Realized $11.7M of gross margin; improved 30.5% over prior year
• Earned $2.5M operating income; increased $1.7M over prior year
• Attained $3.0M Adjusted EBITDA; increased $1.7M over prior year
• Adjusted EBITDA rate of return on revenue was 4.6% compared to
2.2% for the prior year
• Solid cash and liquidity position at 9/30/15
o $5.6M cash on hand
o Generated $2.0M cash from profitable operations during 2015
o Working capital surplus of $4.6M
FY2015 Financial Summary – Full Year
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FY15 Quarterly Trends ― Year over Year
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DLH delivered significant and consistent margin growth in FY15
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FY15 Adjusted EBITDA* ― % Return on Revenue
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Key valuation measurement used by management, shareholders and investors;
Achieved favorable quarterly % return on revenue during 2015
* Non-GAAP measure, refer to Adjusted EBITDA reconciliation provided in this presentation
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FY15 Revenue and Gross Margin Performance
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4th Quarter Year over Year
Full Year over Year
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FY15 Operating Margin Performance
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4th Quarter Year over Year
Full Year over Year
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FY15 Full Year Cash Flow
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FY15 Beginning Cash (10/1/14) $3,908
Cash generated from operating activities 1,983
Cash used in investing activities (142)
Cash used in financing activities (191)
FY15 Ending Cash (9/30/15) $5,558
Generated $2.0M cash from operations
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FY15 Liquidity Position at 9/30/15
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Solid with Consistent Upward Trend
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FY15 Q4 and Total Year Financial Highlights
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FY15 Q4 Adjusted EBITDA
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Reconciliation of GAAP Net Income and EPS to Adjusted EBITDA and EPS on Adjusted EBITDA
We use Earnings Before Interest Tax Depreciation and Amortization (“EBITDA”) adjusted for other non-cash charges (“Adjusted EBITDA”) and “Fully-diluted EPS on adjusted EBITDA” as
supplemental non-GAAP measures of our performance. We define Adjusted EBITDA as net income plus (i) interest and other expenses, net, (ii) provision for or benefit from income taxes, if any,
(iii) depreciation and amortization, and (iv) G&A expenses — equity grants. We compute EPS on adjusted EBITDA using fully diluted shares outstanding as computed for GAAP. These non-GAAP
measures of our performance are used by management to conduct and evaluate its business during its regular review of operating results for the periods presented. Management and the
Company’s Board utilize these non-GAAP measures to make decisions about the use of the Company’s resources, analyze performance between periods, develop internal projections and measure
management performance. We believe that these non-GAAP measures are useful to investors in evaluating the Company’s ongoing operating and financial results and understanding how such
results compare with the Company’s historical performance. By providing these non-GAAP measures as a supplement to GAAP information, we believe we are enhancing investors’ understanding
of our business and our results of operations. A reconciliation of GAAP net income to Adjusted EBITDA and a reconciliation of fully diluted EPS on GAAP income with fully diluted EPS on
adjusted EBITDA is presented below:
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Income Statement Trends
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Balance Sheet Trends
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Question & Answer Session
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Please contact [email protected] or visit http://www.dlhcorp.com/investor-relations.aspx
with any questions subsequent to the live call.
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