SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended March 31, 1997
Commission File Number 0-8401
-----------------------------
CACI International Inc
----------------------
(Exact name of registrant as
specified in its charter)
Delaware
--------
(State or other jurisdiction of
incorporation or organization)
54-1345888
----------
(I.R.S. Employer Identification No.)
1100 North Glebe Road, Arlington, VA 22201
------------------------------------------
(Address of principal executive offices)
(703) 841-7800
--------------
(Registrant's telephone number,
including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
------------------- -----------------------------------------
None None
Securities registered pursuant to Section 12(g) of the Act:
CACI International Inc Common Stock, $0.10 par value
----------------------------------------------------
(Title of each class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
----- -----
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of March 31, 1997: CACI International Inc Common Stock,
$0.10 par value, 10,675,000 shares.<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
PART I: FINANCIAL INFORMATION
- ------------------------------
Item 1. Financial Statements
Unaudited Consolidated Balance Sheets as of March 31, 1997
and June 30, 1996
Unaudited Consolidated Statements of Operations for the Three
Months Ended March 31, 1997 and 1996
Unaudited Consolidated Statements of Operations for the Nine
Months Ended March 31, 1997 and 1996
Unaudited Consolidated Statements of Cash Flows for the Nine
Months Ended March 31, 1997 and 1996
Notes to Unaudited Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
PART II: OTHER INFORMATION
- ---------------------------
Item 1. Legal Proceedings
Item 5. Forward Looking Statements
SIGNATURES
INDEX TO EXHIBITS
<PAGE>
PART 1
FINANCIAL INFORMATION
- ---------------------
Item 1. Financial Statements
- -----------------------------
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
(Dollars in thousands) ASSETS
------
March 31, 1997 June 30, 1996
-------------- -------------
<S> <C> <C>
CURRENT ASSETS (Unaudited)
Cash and equivalents $ 2,660 $ 1,778
Accounts receivable:
Billed 61,010 59,330
Unbilled 12,344 7,770
-------- --------
Total accounts receivable 73,354 67,100
-------- --------
Income taxes receivable 1,549 1,627
Deferred income taxes 141 133
Prepaid expenses and other 4,741 3,593
-------- --------
TOTAL CURRENT ASSETS 82,445 74,231
-------- --------
PROPERTY AND EQUIPMENT, NET
Equipment and furniture 28,141 24,007
Leasehold improvements 2,134 2,186
-------- --------
Property and equipment, at cost 30,275 26,193
Accumulated depreciation and
amoritzation (19,568) (17,138)
-------- --------
TOTAL PROPERTY AND EQUIPMENT, NET 10,707 9,055
-------- --------
ACCOUNTS RECEIVABLE, LONG TERM 6,544 7,289
GOODWILL, NET 15,621 10,548
OTHER ASSETS 2,319 1,813
DEFERRED INCOME TAXES 299 372
-------- --------
TOTAL ASSETS $ 117,935 $ 103,308
======== ========
</TABLE>
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<S> <C> <C>
CURRENT LIABILITIES
Note payable $ 0 $ 9,987
Accounts payable and accrued expenses 16,548 19,196
Accrued compensation and benefits 12,235 13,406
Deferred rent expense 835 724
Deferred income taxes 2,562 2,243
-------- --------
TOTAL CURRENT LIABILITIES 32,180 45,556
-------- --------
NOTES PAYABLE 15,000 0
DEFERRED RENT EXPENSES 1,734 2,274
DEFERRED INCOME TAXES 230 140
SHAREHOLDERS' EQUITY
Common stock -
$.10 par value, 40,000,000 shares
authorized, 14,201,000 and 13,755,000
shares issued 1,420 1,376
Capital in excess of par 10,477 6,239
Retained earnings 71,151 62,628
Cumulative currency translation
adjustments (595) 1,243)
Treasury stock, at cost
(3,526,000 shares) (13,662) (13,662)
-------- --------
TOTAL SHAREHOLDERS' EQUITY 68,791 55,338
-------- --------
TOTAL LIABILITIES & SHAREHOLDERS'
EQUITY $ 117,935 $ 103,308
======== ========
See notes to consolidated financial statements (unaudited).
</TABLE>
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
(Dollars in thousands) Three Months Ended March 31,
---------------------------
1997 1996
---- ----
<S> <C> <C>
REVENUE $ 70,907 $ 62,324
-------- --------
COSTS AND EXPENSES:
Direct costs 39,137 32,602
Indirect costs and selling expenses 24,594 23,858
Depreciation and amortization 1,857 1,374
-------- --------
Total operating expenses 65,588 57,834
-------- --------
Operating income 5,319 4,490
Interest expense 428 246
-------- --------
INCOME BEFORE INCOME TAXES 4,891 4,244
INCOME TAXES 1,912 1,657
-------- --------
NET INCOME $ 2,979 $ 2,587
======== ========
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE $ 0.27 $ 0.24
======== ========
AVERAGE NUMBER OF SHARES AND
EQUIVALENT SHARES OUTSTANDING 11,075 10,679
======== ========
Dividends paid per share NONE NONE
---- ----
</TABLE>
See notes to consolidated financial statements (unaudited).
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
(Dollars in thousands) Nine Months Ended March 31,
--------------------------
1997 1996
---- ----
<S> <C> <C>
REVENUE $ 202,462 $ 179,266
-------- --------
COSTS AND EXPENSES:
Direct costs 108,683 95,282
Indirect costs and selling expenses 73,858 67,821
Depreciation and amortization 4,825 4,007
-------- --------
Total operating expenses 187,366 167,110
-------- --------
Operating income 15,096 12,156
Interest expense 889 416
-------- --------
INCOME BEFORE INCOME TAXES 14,207 11,740
INCOME TAXES 5,684 4,582
-------- --------
NET INCOME $ 8,523 $ 7,158
======== ========
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE $ 0.78 $ 0.67
======== ========
AVERAGE NUMBER OF SHARES AND
EQUIVALENT SHARES OUTSTANDING 10,981 10,682
======== ========
Dividends paid per share NONE NONE
---- ----
</TABLE>
See notes to consolidated financial statements (unaudited).
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
(Dollars in thousands)
Nine Months Ended March 31,
--------------------------
1997 1996
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 8,523 $ 7,158
Reconciliation of net income to net cash
provided by operating activities:
Depreciation and amortization 4,825 4,007
Provision for deferred income taxes 473 1,407
Loss on sale of property and equipment 17 71
Changes in operating assets and liabilities:
Accounts receivable (2,686) (1,545)
Prepaid expenses and other assets 428 210
Accounts payable and accrued expenses (3,726) 770
Accrued compensation and benefits (1,246) (2,152)
Deferred rent expense (429) (336)
Income taxes receivable 123 (2,632)
-------- --------
Net cash provided by operating activities 6,302 6,958
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of property and equipment (4,629) (2,987)
Purchase of businesses (9,386) (14,000)
Proceeds from sale of property & equipment 9 40
Other (808) (433)
-------- --------
Net cash used in investing activities (14,814) (17,380)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds under line-of-credit 90,272 80,789
Payments under line-of-credit (85,258) (71,275)
Proceeds from stock options 4,282 791
-------- --------
Net cash provided by financing activities 9,296 10,305
-------- --------
Effect of changes in currency rates on cash
and equivalents 100 (41)
-------- --------
Net increase (decrease) in cash and
equivalents 884 (158)
Cash and equivalents, beginning of period 1,776 1,996
-------- --------
Cash and equivalents, end of period $ 2,660 $ 1,838
======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION
Cash paid during the period for
Income taxes, net of refunds $ 1,764 $ 5,337
======== ========
Interest $ 784 $ 416
======== ========
</TABLE>
See notes to consolidated financial statements (unaudited).
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
A. Basis of Presentation
---------------------
The accompanying unaudited consolidated financial statements have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and note disclosures normally included in
the annual financial statements, prepared in accordance with generally
accepted accounting principles, have been condensed or omitted pursuant to
those rules and regulations, although the Company believes that the
disclosures made are adequate to make the information presented not
misleading.
In the opinion of management, the accompanying unaudited consolidated
financial statements reflect all necessary adjustments and reclassifications
(all of which are of a normal, recurring nature) that are necessary for fair
presentation for the periods presented. It is suggested that these
consolidated financial statements be read in conjunction with the
consolidated financial statements and the notes thereto included in the
Company's latest annual report to the Securities and Exchange Commission on
Form 10-K for the year ended June 30, 1996.
B. Accounts Receivable
-------------------
Total accounts receivable are net of allowance for doubtful accounts of
$2,448,000 and $2,245,000 at March 31, 1997 and June 30, 1996, respectively.
Accounts receivable are classified as follows:
(Dollars in thousands)
<TABLE>
March 31, 1997 June 30, 1996
-------------- -------------
<S> <C> <C>
BILLED AND BILLABLE RECEIVABLES:
Billed receivables $ 52,641 $ 53,836
Billable receivables at end of period 8,369 5,494
-------- --------
TOTAL BILLED AND BILLABLE RECEIVABLES 61,010 59,330
-------- --------
UNBILLED RECEIVABLES:
Unbilled pending receipt of contractual
documents authorizing billing 12,173 7,598
Unbilled retainages and fee withholds
expected to be billed within the
next 12 months 171 172
-------- --------
12,344 7,770
Unbilled retainages and fee withholds
expected to be billed beyond the
next 12 months 6,544 7,289
-------- --------
TOTAL UNBILLED RECEIVABLES 18,888 15,059
-------- --------
TOTAL ACCOUNTS RECEIVABLE $ 79,898 $ 74,389
======== ========
</TABLE>
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
C. Acquisitions and Goodwill
------------------------
On October 1, 1996, the Company acquired the majority of contracts and
assets of Sunset Resources, Inc. ("SRI"). SRI is an engineering and
information technology firm that has focused on logistics and engineering
support services to the U.S. Air Force and are experts in electronic
commerce. The purchase price of the acquisition was financed primarily
through bank borrowing under the Company's existing line of credit. The
purchase price was allocated to the assets and liabilities using their fair
values at the date of acquisition. The excess of the purchase price over the
fair value of the net assets acquired was $4.6 million. This excess has been
recorded as goodwill and will be amortized on a straight line basis over 15
years. The preliminary purchase price allocation is subject to change during
the year following the acquisition as additional information concerning net
asset valuation is obtained. Therefore, the final allocation may differ from
the preliminary allocation.
On January 3, 1997, the Company acquired the business of Sales Performance
Analysis Limited ("SPA") including the intellectual property rights to
certain software products for $2.6 million. SPA develops and markets a
unique range of specialized software products and services that enable
companies to make more effective use of their field forces through the
optimal configuration of sales and services territories. SPA's annual
revenue prior to acquisition was $2.0 million. It is currently estimated
that some $0.7 million of the purchase consideration will be allocated to
goodwill, which will be amortized over 15 years, with $1.7 million allocated
to software which will be amortized over 5 years, and $0.2 million allocated
to tangible assets.
D. Note Payable - Classification
-----------------------------
At the end of fiscal year 1996, the Company had a $25 million revolving
credit agreement scheduled to expire on March 31, 1997. On July 26, 1996,
the Company entered into a new three-year $50 million revolving credit
agreement. Because the new credit facility extends the term of the agreement
from a one-year to a three-year credit facility effective in fiscal 1997, the
Company has classified its March 31, 1997, line of credit balance as a long
term debt, while the June 30, 1996, line of credit balance remains classified
as a short term debt.
E. Earnings per Share
------------------
In March 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" (EPS) which
simplifies the standards for computing EPS previously found in APB Opinion
No. 15 and makes them comparable to international EPS standards. The
Statement is effective for financial statements issued for periods ending
after December 15, 1997. Had the following statement been effective for the
quarters and the nine months ended March 31, 1997 and 1996, earnings per
share would have been presented as follows:
<PAGE>
CACI INTERNATIONAL INC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
E. Earnings per Share (Cont.)
Three Months Ended Nine Months Ended
------------------ -----------------
March 31, March 31,
-------- --------
1996 1997 1996 1997
---- ---- ---- ----
Earnings per common share $0.28 $0.25 $0.82 $0.71
Earnings per common share-
assuming dilution $0.27 $0.24 $0.78 $0.67
F. Comments and Contingencies
--------------------------
The Company is involved in various lawsuits, claims, and administrative
proceedings arising in the normal course of business. Based on the
information available as of May 14, 1997, management is of the opinion that
any liability or loss associated with such matters will not have a material
adverse effect on the Company's financial condition.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
- ------------------------------------------------------------------------
Results of Operations - For the Three and Nine Months ended March 31, 1997
- --------------------------------------------------------------------------
and March 31, 1996.
- ------------------
REVENUE
The table below sets forth the customer mix in revenue with related
percentages of total revenue for the three and nine months ended on March 31,
1997 (FY 1997) and March 31, 1996 (FY 1996), respectively:
<TABLE>
(Dollars in thousands, except as percents)
Third Quarter
------------------------------------
FY97 FY96
----------------- -----------------
<S> <C> <C> <C> <C>
Department of Defense $36,718 51.8% $34,000 54.5%
Federal Civilian Agencies 18,221 25.7% 14,410 23.1%
Commercial 14,639 20.6% 12,323 19.8%
State & Local Governments 1,329 1.9% 1,591 2.6%
------- ------ ------- ------
Total $70,907 100.0% $62,324 100.0%
======= ====== ======= ======
</TABLE>
<TABLE>
First Nine Months
--------------------------------------
FY97 FY96
------------------ ------------------
<S> <C> <C> <C> <C>
Department of Defense $105,203 52.0% $ 94,946 52.9%
Federal Civilian Agencies 50,611 25.0% 43,943 24.5%
Commercial 41,240 20.4% 34,515 19.3%
State & Local Governments 5,408 2.6% 5,862 3.3%
-------- ------ -------- ------
Total $202,462 100.0% $179,266 100.0%
======== ====== ======== ======
</TABLE>
During the three months ("third quarter") and nine months ended March 31,
1997, the Company's total revenue increased by 14%, or $8.6 million, and by
13%, or $23.2 million, respectively, over the same periods last year. The
increases were primarily the result of the acquisitions described below,
coupled with internal growth in Federal civilian agencies and commercial
products and services revenues.
For the quarter and the first nine months ending March 31, 1997, acquisitions
contributed $4.2 million and $16.7 million to revenue growth in the
respective periods . On September 1, 1995, the Company acquired Automated
Sciences Group, Inc. ("ASG") which contributed approximately $2.8 million to
the FY 1997 first quarter revenue versus $1.2 million for the same quarter
last year. On January 1, 1996, IMS Technologies, Inc. ("IMS") was acquired,
and it contributed revenue of approximately $8.3 million for the six months
ending December 31, 1996. On October 1, 1996, the Company acquired the
majority of contracts and assets of Sunset Resources, Inc. ("SRI"), which
added revenues of approximately $4.2 million and $6.8 million, respectively,
for the quarter and nine months ending March 31, 1997.
Revenue from the Department of Defense ("DoD") increased by 8%, to $36.7
million, for the quarter, and by 11%, to $105.2 million, for the first nine
months. For the quarter, the growth was primarily the result of the SRI
acquisition discussed above. The first nine months growth was primarily the
result of ASG and SRI acquisitions.
Total revenue from Federal Civilian Agencies increased by 26% to $18.2
million, for the quarter, and by 15%, to $50.6 million, for the first nine
months in FY 1997. Federal Civilian Agencies revenue is primarily derived
from Department of Justice ("DoJ") litigation support efforts. These
services are dependent on the level of DoJ litigation that the Company is
supporting at any period of time and have fluctuated from quarter to quarter.
FY 1997 third quarter DoJ revenue increased sharply to $14.7 million versus
last year's third quarter $11.1 million. For the first nine months of FY
1997, revenue from DoJ was $38.4 million compared to $36.2 million for the
same period last year.
The Federal Civilian Agencies third quarter revenue growth was primarily the
result of the quarter's increased DoJ litigation support level while the
year-to-date growth is the result of the IMS acquisition discussed above
coupled with the third quarter DoJ revenue increase.
During the three and nine months ended March 31, 1997, Commercial revenue
increased by 19%, or $2.3 million, and 19%, or $6.7 million, respectively,
over the same periods last year. These increases are primarily the result of
increases in sales of simulation and marketing analysis software products
coupled with higher commercial litigation support and systems sales. The
nature of the Company's proprietary software products business is inherently
less predictable than the Company's longer-term contract work with the
Federal Government and may fluctuate from quarter to quarter.
RESULTS OF OPERATIONS
- ---------------------
The following table sets forth the amounts and the relative percentage that
certain items of expense and earnings bear to revenue for the three months
and nine months ended March 31, 1997 and March 31, 1996, respectively.
<TABLE>
Dollar Amount (in thousands)
---------------------------------------------
Third Quarter First Nine Months
---------------------------------------------
FY97 FY96 FY97 FY96
---------------------------------------------
<S> <C> <C> <C> <C>
Revenue $ 70,907 $ 62,324 $202,462 $179,266
Costs and expenses
Direct costs 39,137 32,602 108,683 95,282
Indirect costs 24,594 23,858 73,858 67,821
Depreciation and
amortization 1,857 1,374 4,825 4,007
------- ------- ------- -------
Total operating expenses 65,588 57,834 187,366 167,110
Income from operations 5,319 4,490 15,096 12,156
Interest expense 428 246 889 416
------- ------- ------- -------
Earnings before income
taxes 4,891 4,244 14,207 11,740
Income taxes 1,912 1,657 5,684 4,582
------- ------- ------- -------
Net income $ 2,979 $ 2,587 $ 8,523 $ 7,158
======= ======= ======= =======
</TABLE>
<PAGE>
<TABLE>
Percentage of Revenue
---------------------------------------------
Third Quarter First Nine Months
---------------------------------------------
FY97 FY96 FY97 FY96
---------------------------------------------
<S> <C> <C> <C> <C>
Revenue 100.0% 100.0% 100.0% 100.0%
Costs and expenses
Direct costs 55.2% 52.3% 53.7% 53.2%
Indirect costs 34.7% 38.3% 36.5% 37.8%
Depreciation and
amortization 2.6% 2.2% 2.3% 2.2%
------ ------ ------ ------
Total operating expenses 92.5% 92.8% 92.5% 93.2%
Income from operations 7.5% 7.2% 7.5% 6.8%
Interest expense 0.6% 0.4% 0.5% 0.2%
------ ------ ------ ------
Earnings before income
taxes 6.9% 6.8% 7.0% 6.6%
Income taxes 2.7% 2.6% 2.8% 2.6%
------ ------ ------ ------
Net income 4.2% 4.2% 4.2% 4.0%
====== ====== ====== ======
</TABLE>
Compared with the third quarter of FY 1996, operating income increased by 18%
to $5.3 million, from $4.5 million. For the first nine months of FY 1997,
operating income increased to $15.1 million from $12.2 million, or 24%.
Operating income increased as a result of revenue increases, as well as from
margin improvements. Operating income in the third quarter of FY 1997
benefitted from a $0.3 million pretax gain on the sale of a small, non-
strategic software product business that had generated approximately $1.5
million in annual revenues. The operating income for the first nine months
of FY 1997 also includes a $0.5 million favorable impact of prior year
indirect cost rates settlements which were the subject of routine government
audits.
For the quarter, direct costs increased by $6.5 million, or 20%, largely due
to growth in the business. Direct costs include direct labor and other
direct costs (i.e. non-labor direct costs) which generally are passed to the
customer without significant mark-up. Direct labor, the principal driver of
profit bearing revenue, increased by 7% in the third quarter of FY 1997
versus the same period last year. Other direct costs, which historically
have larger quarter to quarter variances, increased by approximately $5.0
million, or 48%. These higher other direct costs are the principal reason
for the increase in the percentage of total direct costs in the most recent
quarter. For the first nine months of FY 1997, direct costs increased by
$13.4 million, or 14%, as a result of a 20% increase in other direct costs
and a 10% increase in direct labor.
Indirect costs include fringe benefits, indirect labor, marketing and bid &
proposal costs, and other discretionary costs. Fringe benefits, representing
the largest category of indirect expenses, increased proportionally to total
labor costs. Total indirect costs increased by $0.7 million, or 3%, for the
quarter, and, by $6.0 million, or 9%, for the first nine months of the year,
primarily as a result of increased revenue and related direct labor.
Indirect costs increased at a lower rate in the most recent quarter due to
management's increased attention to cost controls.
The depreciation and amortization expense increases of $0.5 million for the
quarter and $0.8 million for the first nine months were primarily the result
of the acquisitions previously discussed.
Interest expense for the three and nine month periods ending March 31, 1997
was $428,000 and $889,000, respectively. Compared to the same periods last
year, interest expense increased by $182,000 and $473,000, respectively.
These increases are the result of increased borrowings incurred to support
the acquisitions discussed above.
The effective income tax rate for the first nine months was 40% versus 39%
for the same period last year. The increase in the effective tax rate is
primarily the result of the increase in non-deductible amortization goodwill
expense associated with the acquisitions discussed above.
Liquidity and Capital Resources
- -------------------------------
For the first nine months of FY 1997, operations provided $6.3 million of
cash compared to the $7.0 million in FY 1996. The FY 1997 decrease in cash
provided by operating activities is largely the result of increases in
working capital requirements to support the more rapid growth in revenue in
FY 1997.
Investing activities used cash of approximately $14.8 million during the nine
months ended March 31, 1997, versus $17.4 million for the same period last
year. Acquisitions, discussed above, accounted for the majority of the
investments, with most of the remaining investments allocated to the purchase
of office and computer-related equipment for use in the performance of
contracts and for increased efficiency in the Company's administration.
During the nine months ended March 31, 1997, the Company's financing
activities provided cash of approximately $9.3 million, primarily from a $5.0
million increase in borrowings under the Company's revolving line of credit
and from $4.3 million in proceeds and derived income tax benefits from
exercises of stock options.
On October 1, 1996 the Company completed its acquisition of the business and
most of the assets of SRI for $5.3 million. On January 3, 1997, the Company
acquired the business of Sales Performance Analysis Limited for $2.6 million.
Both acquisitions were financed with bank borrowings under the existing line
of credit.
The Company maintains a $50 million unsecured revolving bank credit facility
in the U.S., and a 500,000 pound sterling unsecured line of credit in London,
England. These credit facilities expire on July 1999, and December 1997,
respectively. At March 31, 1997, the Company had approximately $36 million
available for borrowing under its revolving lines of credit. Accordingly,
the Company believes that the combination of internally generated funds,
available bank credit and cash on hand will provide the required liquidity
and capital resources for the foreseeable future.
<PAGE>
PART II
OTHER INFORMATION
- -----------------
Item 1. Legal Proceedings
- -------------------------
Ceridian Corporation v. CACI Systems Integration Inc
- ----------------------------------------------------
Reference is made to Part II, Item 1, Legal Proceedings, in the Registrant's
Quarterly Report on Form 10-Q for the period ending December 31, 1996, for
the most recently filed information concerning the suit filed on October 6,
1995 by Ceridian Corporation ("Ceridian") in the District Court for Hennepin
County, Minnesota, against Registrant's wholly-owned subsidiary, CACI Systems
Integration Inc. ("CACI"), alleging breach of contract, breach of warranty,
and repudiation by CACI in connection with a contract for the development of
a manufacturing system. In January 1996, CACI filed its answer and
counterclaims, denying Ceridian's allegations and seeking damages from
Ceridian for breach of contract, intentional and negligent misrepresentation,
and tortious interference with contract.
Since the filing of the Registrant's report indicated above, the status of
the litigation has not changed.
CACI, INC. - FEDERAL v. Arizona Department of Transportation
- ------------------------------------------------------------
Reference is made to Part II, Item 1, Legal Proceedings, in the Registrant's
Quarterly Report on Form 10-Q for the period ending December 31, 1996 for the
most recently filed information concerning the lawsuit filed on June 25,
1996, by CACI, Inc.-Federal ("CACI"), the Registrant's wholly-owned
subsidiary, in Superior Court for Maricopa County, Arizona, against the
Arizona Department of Transportation ("ADOT"). This suit seeks the
following: (i) a declaratory judgment that the disputes procedure mandated by
the Arizona Procurement Code is unconstitutional; (ii) a declaratory judgment
that ADOT cannot assert claims against CACI under the mandated disputes
procedure; (iii) a declaratory judgment that ADOT is not entitled to recover
consequential damages in connection with the dispute; (iv) $2,938,990 plus
interest in breach of contract damages; (v) the return of CACI property
seized by ADOT in connection with the termination of the contract; and (vi)
lawyer's fees.
Since the filing of Registrant's report indicated above, the status of the
case has changed as follows. On March 31, 1997 ADOT filed its answer denying
CACI's claims and asserting counterclaims seeking in excess of $100 million
against CACI, primarily in the form of consequential damages. As a result
of technical pleading errors, ADOT has agreed to redraft and file an amended
Answer and Counterclaim within approximately 30 days.
Item 5. Other Information - Forward Looking Statements
- ------------------------------------------------------
This filing may contain "forward-looking" statements, as that term is defined
in the Private Securities Litigation Reform Act of 1995. Such statements
include, but are not limited to, statements concerning expectations of the
Company's future performance in terms of revenue and earnings. The Company
cautions investors that there can be no assurance that actual results will
not differ materially from those projected or suggested in such forward-
looking statements. Factors which could cause a material difference in
results include, but are not limited to, the following: regional and national
economic conditions; changes in interest rates; changes in government
spending policies and/or decisions concerning specific programs; individual
business decisions of customers and clients; developments in technology;
competitive factors and pricing pressures; acts of God; and changes in
government laws or regulations.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CACI International Inc
----------------------
(Registrant)
Date: By: /s/
------------------ -----------------------------------
Dr. J.P. London
Chairman of the Board,
President, and Director
(Principal Executive Officer)
Date: By: /s/
------------------ ------------------------------------
James P. Allen
Executive Vice President,
Chief Financial Officer, and Treasurer
(Principal Financial and Accounting Officer)
CACI INTERNATIONAL INC AND SUBSIDIARIES
INDEX TO EXHIBITS
Exhibit
Number Title
- ------ -----
11 Computation of Earnings per Common and Common
Equivalent Share
<PAGE>
EXHIBIT 11
CACI INTERNATIONAL INC AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON
AND COMMON EQUIVALENT SHARE
<TABLE>
Three Months Ended March 31, Nine Months Ended March 31,
---------------------------- ---------------------------
1997 1996 1997 1996
------ ------ ------ ------
<S> <C> <C> <C> <C>
Net Income $ 2,979 $ 2,587 $ 8,523 $ 7,158
Average shares outstanding
during the period 10,633 10,162 10,445 10,117
Dilutive effect of stock
options after application
of treasury stock method 442 517 536 565
------ ------ ------ ------
Average number of shares
outstanding during the period 11,075 10,679 10,981 10,682
====== ====== ====== ======
Earnings per common and
common equivalent share: $ 0.27 $ 0.24 $ 0.78 $ 0.67
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR FY 1997 QUARTER ENDED MARCH 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,660,000
<SECURITIES> 0
<RECEIVABLES> 75,802,000
<ALLOWANCES> (2,448,000)
<INVENTORY> 0
<CURRENT-ASSETS> 82,445,000
<PP&E> 30,275,000
<DEPRECIATION> (19,568,000)
<TOTAL-ASSETS> 117,935,000
<CURRENT-LIABILITIES> 32,180,000
<BONDS> 15,000,000
0
0
<COMMON> 1,420,000
<OTHER-SE> 67,371,000
<TOTAL-LIABILITY-AND-EQUITY> 117,935,000
<SALES> 0
<TOTAL-REVENUES> 202,462,000
<CGS> 0
<TOTAL-COSTS> 108,683,000
<OTHER-EXPENSES> 78,365,000
<LOSS-PROVISION> 318,000
<INTEREST-EXPENSE> 889,000
<INCOME-PRETAX> 14,207,000
<INCOME-TAX> 5,684,000
<INCOME-CONTINUING> 8,523,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,523,000
<EPS-PRIMARY> 0.78
<EPS-DILUTED> 0.78
</TABLE>
