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CACI International Inc First Fiscal Quarter FY11 Earnings Conference Call October 28, 2010.

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Presentation on theme: "CACI International Inc First Fiscal Quarter FY11 Earnings Conference Call October 28, 2010."— Presentation transcript:

1 CACI International Inc First Fiscal Quarter FY11 Earnings Conference Call October 28, 2010

2 CACI Proprietary Information 2 Forward-looking Statements There are statements made herein which do not address historical facts, and therefore could be interpreted to be forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. The factors that could cause actual results to differ materially from those anticipated include, but are not limited to, the following: regional and national economic conditions in the United States and the United Kingdom, including conditions that result from a prolonged recession; terrorist activities or war; changes in interest rates; currency fluctuations; significant fluctuations in the equity markets; changes in our effective tax rate; finalization of accounting for business combinations, including valuation of intangibles and contingent consideration; failure to achieve contract awards in connection with recompetes for present business and/or competition for new business; the risks and uncertainties associated with client interest in and purchases of new products and/or services; continued funding of U.S. government or other public sector projects, based on a change in spending patterns, or in the event of a priority need for funds, such as homeland security, the war on terrorism or rebuilding Iraq, or an economic stimulus package; government contract procurement (such as bid protest, small business set asides, loss of work due to organizational conflicts of interest, etc.) and termination risks; the results of government investigations into allegations of improper actions related to the provision of services in support of U.S. military operations in Iraq; the results of government audits and reviews conducted by the Defense Contract Audit Agency or other government entities with cognizant oversight; the insourcing of contractor positions by the government; individual business decisions of our clients; paradigm shifts in technology; competitive factors such as pricing pressures and/or competition to hire and retain employees (particularly those with security clearances); market speculation regarding our continued independence; material changes in laws or regulations applicable to our businesses, particularly in connection with (i) government contracts for services, (ii) outsourcing of activities that have been performed by the government, and (iii) competition for task orders under Government Wide Acquisition Contracts (“GWACs”) and/or schedule contracts with the General Services Administration; the ability to successfully integrate the operations of our recent or any future acquisitions; our own ability to achieve the objectives of near term or long range business plans; and other risks described in the company’s Securities and Exchange Commission filings.

3 CACI Proprietary Information 3 Participants — Paul Cofoni President & Chief Executive Officer — Tom Mutryn Chief Financial Officer — Bill Fairl President of U.S. Operations — Greg Bradford Chief Executive of CACI Limited UK

4 CACI Proprietary Information 4 Record First Quarter Results RECORDS RECORD  Revenue of $834.0M ………………………………………………………….. up 12.8% RECORD  Operating income of $52.1M …….…………………..…. up 13.2% RECORD  Net income of $28.7M ………………………………………………..…. up 20.1% RECORD  Diluted EPS of $0.92 …………………………………………………..……. up 17.7% RECORD  Contract funding orders of $1.46B …..…. up 39.9% RECORD  Contract awards of $1.48B …………………..........…...…. up 102.6% Raising FY 2011 revenue guidance by $200 million and EPS guidance by $0.20

5 CACI Proprietary Information 5  Signed agreements to acquire TechniGraphics and ASR – Moves us into the geospatial intelligence market – Strengthens end-to-end solutions for Intelligence Community – Both expected to close on November 1, 2010 Strong Execution of Growth Strategy 5 CACI Proprietary Information

6 6 Aligned With Government Priorities  Leadership in our market space  Mission-critical warfighter support in priority areas − Less vulnerable to DoD’s spending reprioritization initiatives  Already performing on IT modernization Aligned With Government Priorities CACI Proprietary Information 6

7 7  Strong first quarter performance  Record funding orders and contract wins  Strong funded backlog  Successful retention of existing business  Operational excellence Raising Guidance CACI Proprietary Information 7

8 8 Record Financial Results Total Revenue Up 12.8% Record revenue driven by:  Organic revenue growth of 10.8%  Direct labor growth of 7.3%  ODC growth of 20.6% Operating Income Up 13.2% Record operating income driven by:  Strong growth in direct costs  Continued control of indirect costs CACI Proprietary Information 8

9 9 Record Bottom-Line Results Net Income Up 20.1% Diluted EPS Up 17.7%  Q1 effective tax rate of 37.8%; FY 2011 projection of 38.1%  Repurchased 395,000 shares at an average price of $42.62  Record diluted adjusted EPS of $1.34 CACI Proprietary Information 9

10 10  Cash and equivalents of $110 million  Net debt of $295 million  New credit facility − $150 million term loan and $600 million revolving credit facility − Provides additional financial flexibility for years to come Strong Balance Sheet DSOs CACI Proprietary Information 10

11 CACI Proprietary Information 11 Raising Guidance for FY11 This guidance represents our views as of October 27, 2010. Investors are reminded that actual results may differ from these estimates for reasons described in our Safe Harbor Statement and our filings with the SEC. Current FY11Previous FY11Guidance Revenue (millions)$3,450 - $3,600$3,250 - $3,400 Net Income (millions)$121 - $128$116 - $122 Diluted EPS$3.90 - $4.10$3.70 - $3.90 Diluted shares (millions)31.131.3 FY11 revenue expected to be 10 – 14% over ’10 FY11 net income expected to be 14 – 20% over ’10 FY11 diluted EPS expected to be 12 – 18% over ’10

12 CACI Proprietary Information 12 Record Funding Orders and Awards  Operational excellence drives performance — Contract funding orders grew 39.9% to $1.46 billion — Funded backlog of $2.5 billion — Awards of $1.48 billion increased 102.6% over last year  70% of awards were for new business  Average period of contract performance 2+ years  Providing increased growth in FY 2011 CACI Proprietary Information 12

13 CACI Proprietary Information 13 Extraordinary Customer Wins  Two large, single-award wins in Healthcare IT — Department of Veterans Affairs $91 million Virtual Lifetime Electronic Record (VLER) contract — Selected for Department of Defense’s $75 million Virtual Interactive Processing System (VIPS) contract CACI Proprietary Information 13

14 CACI Proprietary Information 14 Extraordinary Customer Wins (cont’d)  Two biometrics awards totaling $239 million — Experimentation, demonstration, and fielding of biometric and information management capabilities — Development of biometrics tools that recognize and track individuals CACI Proprietary Information 14

15 CACI Proprietary Information 15  Large IDIQ contracts — Army Rapid Response – Third Generation: 5-year award with ceiling value of $16.4 billion — Centers for Disease Control and Prevention: 10-year award with a ceiling value of $1 billion Extraordinary Customer Wins (cont’d) CACI Proprietary Information 15

16 CACI Proprietary Information 16 Opportunities Remain Attractive  Pipeline remains strong — $3.8 billion in submitted proposals, scheduled for award by the end of March 2011 — Expect to submit approximately $7.5 billion new proposals during the next two quarters  About half are recompetes  Continued strength in new hiring — Approximately 200 net new hires — Open hiring requisitions grew to more than 400  Operating margin improvement plans continue — Margin improvement training programs for our managers — Added a margin improvement element to our Incentive Compensation plan — Key component of Bid and Proposal investment decisions

17 CACI Proprietary Information 17 CEO Closing Comments  First quarter demonstrates success of focused growth strategy  Record awards show our innovation and differentiation  Strategic M&A complementing our strengths and adding depth to our solutions  Positioned in areas of highest priority for our nation  Consistently achieving our financial goals  Raising our FY11 guidance

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