News Feed Item

ICF International Reports Full Year and Fourth Quarter 2013 Results

ICF International, Inc. (NASDAQ:ICFI), a leading provider of consulting services and technology solutions to government and commercial clients, reported results for the full year and fourth quarter ended December 31, 2013.

Full Year 2013 Results

“Full year 2013 was representative of our differentiated business model. For the third consecutive year, commercial revenue growth significantly outpaced total revenue growth, driven by an 18 percent increase in revenues from energy efficiency clients and solid performance across our other commercial activities. International government revenues increased 44 percent year-on-year, demonstrating our ability to successfully leverage existing expertise and qualifications and integrate acquisitions to expand our pipeline and improve win rates.”

“ICF’s increased spending on business development over the last two years has yielded excellent returns on our investments. Contract awards reached a record $1.2 billion in 2013, up 21 percent year-over-year, reflecting the importance of our domain expertise in the broad areas of health and energy and the increasing number of implementation projects that we have captured as natural follow-ons to our advisory work,” said Sudhakar Kesavan, Chairman and Chief Executive Officer.

For full year 2013, revenue was $949.3 million, up 1.3 percent over the $937.1 million reported for full year 2012. Service revenue, total revenue less subcontractor and other direct costs, increased 0.6 percent to $709.8 million. EBITDA was $85.4 million; and EBITDA margin was 9.0 percent. Operating income was $64.7 million compared to the $66.2 million reported in 2012. Net income increased 3.3 percent to $39.3 million, and earnings per diluted share were $1.95, up from $1.91. Adjusted earnings per diluted share, which exclude acquisition costs, were $1.98 in 2013, up from $1.93.

ICF experienced growth across two of its three key markets in 2013. Health, Social Programs, and Consumer/Financial increased 4.0 percent, and Energy, Environment, and Infrastructure was up 1.7 percent, together accounting for 88 percent of total revenues.

“ICF’s fourth quarter results were affected by the 16-day government shutdown in October, but were in line with the guidance we provided in November,” said Mr. Kesavan. “As anticipated, our growing commercial and international government businesses, and a pick up in state and local projects, enabled us to partially offset the revenue decline related to the government closure.”

For the fourth quarter, revenue was $229.8 million, a 1.0 percent decrease from the $232.0 million reported in the 2012 fourth quarter. Service revenue decreased 0.8 percent to $171.3 million. Fourth quarter profitability was significantly impacted by the government shutdown. EBITDA was $17.7 million, and EBITDA margin was 7.7 percent. Operating income was $12.6 million, compared to the $14.5 million reported in the 2012 fourth quarter. Net income was $7.8 million, or $0.38 per diluted share compared to $9.2 million, or $0.47 per diluted share earned in the comparable 2012 period.

Backlog and New Business Awards

Backlog was $1.7 billion at the end of 2013, up 10 percent from $1.5 billion at 2012 year-end. Funded backlog was $697 million, or 42 percent of total backlog. The total value of contracts awarded in the fourth quarter of 2013 was $224 million, up 36 percent from the same period last year. The total value of contracts awarded in 2013 was $1.2 billion, up 21 percent over 2012 levels.

Commercial Business 2013 Highlights

Revenues from commercial clients increased 7 percent in 2013 to $267.9 million and represented 28 percent of total revenue, up from 27 percent in 2012. Excluding a large infrastructure project that was in a slower phase of construction in 2013, commercial revenues increased 9.7 percent. Revenues from energy efficiency clients increased 18 percent and accounted for 39 percent of commercial revenues.

Key Commercial Sales Highlights for the Fourth Quarter

Commercial sales awards were $83 million for the 2013 fourth quarter, representing 37 percent of total sales for the period, and a book-to-bill ratio of 1.2.

ICF was awarded more than 400 commercial projects globally in the fourth quarter. Individual commercial sales in excess of $1 million included:

  • Eight energy efficiency contracts for U.S. Northeast, Midwest, and West Coast utilities encompassing new residential market contracts, scope expansion and extensions of existing contracts
  • Environmental infrastructure support projects on the U.S. West Coast
  • New interactive data applications for a utility and for a major financial institution

Primary areas of additional awards included residential as well as commercial and industrial energy efficiency projects, aviation industry consulting, management consulting for health insurers, health survey research, interactive data applications for health care insurers and large financial institutions, environmental program and compliance management, and market studies for utilities and industry associations.

Government Business 2013 Highlights

  • U.S. Federal Government revenues declined 2.5 percent to $549.6 million in 2013 and accounted for 58 percent of total revenue, compared to 60 percent in 2012. Growth areas included education, public health, and international health survey research.
  • U.S. state and local government revenues declined 4.7 percent and accounted for 9 percent of total revenue, compared to 10 percent in 2012.
  • International government revenues increased 43.6 percent and accounted for 5 percent of total revenue, up from 3 percent in 2012, primarily reflecting recent contract wins with the European Commission and the U.K. government.

Key Government Contracts Won in the Fourth Quarter

ICF was awarded more than 100 U.S. Federal Government contracts and task orders and hundreds of additional contracts from other U.S. state and local and international governments. The largest awards included:

  • Human Health Risk Assessment: A contract valued at approximately $33 million to continue to support the Environmental Protection Agency’s National Center for Environmental Assessment to conduct human health risk assessments on chemicals and other environmental stressors.
  • Cybersecurity: A contract valued at nearly $20 million to continue cybersecurity and identification management support for the Social Security Administration.
  • Health Informatics: A contract valued at more than $10 million with the National Science Foundation (NSF) to provide data collection, information technology, and analysis support of 11 NSF education and training grant programs.
  • Clean Energy: A $6 million contract with the Environmental Protection Agency to support clean energy and climate change strategies and programs.
  • European Immigration Policy: A $5 million contract with the European Commission to provide program support to the European Migration Network.

Additional individual government awards of greater than $1 million included educational simulation support for medical training for the U.S. Navy, strategic communications and software support to two offices of the National Institutes of Health, web support for two offices of the Department of Health and Human Services, information portal support for the Department of Education, program support for two offices of the Department of Transportation, and analytical support to the National Science Foundation.

Acquisitions of CITYTECH, Inc., and Mostra SA

ICF is announcing today that it has signed a definitive agreement to purchase CITYTECH, Inc., a Chicago-based digital interactive consultancy specializing in enterprise applications development, web experience management, mobile application development, cloud enablement, and managed services. For 2013, CITYTECH had annual revenues of approximately $16 million and 100 employees.

“A leading partner with Adobe, CITYTECH will add expertise to ICF’s content management capabilities. It is a complementary fit with ICF Interactive, which combines user experience, creative services, systems integration, marketing, and e-commerce services into an integrated suite of capabilities designed to meet commercial and government clients’ digital and interactive business needs,” Mr. Kesavan said.

This transaction follows ICF’s recent acquisition of Brussels-based Mostra SA, a fully-integrated communications firm with annual revenues of approximately $40 million and 140 employees. Mostra offers end-to-end, multi-channel communications solutions to assist government and commercial clients in reaching out to their stakeholders and customers. The firm is a key provider of strategic communications to European Union institutions, in particular the European Commission, and significantly increases ICF’s ability to deliver implementation services in Europe.

Summary and Outlook

“In 2013, we continued to execute effectively on our strategy to drive growth by building our commercial and international government qualifications and business wins. Since the end of the year, we have announced two acquisitions that are strategically important and expected to be accretive in 2014. Both position us to further expand our implementation activities, and Mostra will also enable us to replicate the success of our program lifecycle strategy in our international operations.”

“In 2014, we expect our commercial and international government activities to further increase as a percentage of revenues. While we will continue to invest in growth initiatives, we expect to see meaningful margin improvement coming from scale benefits, a more favorable business mix, and increased productivity.”

“In 2014, we expect to exceed the $1 billion milestone in revenues and generate EBITDA around $100 million. Based on our current portfolio of business, including the acquisitions of Mostra and CITYTECH, we expect full year 2014 revenues of $1.025 billion to $1.065 billion and earnings per diluted share of $2.27 to $2.37, based on approximately 20.2 million diluted weighted average number of shares outstanding and an effective tax rate of 38.5 percent. Our operating cash flow for 2014 is expected to be $70 million to $80 million,” Mr. Kesavan noted.

About ICF International

ICF International (NASDAQ:ICFI) provides professional services and technology solutions that deliver beneficial impact in areas critical to the world’s future. ICF is fluent in the language of change, whether driven by markets, technology, or policy. Since 1969, we have combined a passion for our work with deep industry expertise to tackle our clients’ most important challenges. We partner with clients around the globe—advising, executing, innovating—to help them define and achieve success. Our more than 4,500 employees serve government and commercial clients from more than 60 offices worldwide. ICF's website is www.icfi.com.

Caution Concerning Forward-looking Statements

Statements that are not historical facts and involve known and unknown risks and uncertainties are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Such statements may concern ICF’s current expectations about its future results, plans, operations and prospects and involve certain risks, including those related to the government contracting industry generally; ICF’s particular business, including its dependence on contracts with U.S. federal government agencies; and its ability to acquire and successfully integrate businesses. These statements include those that refer to ICF’s current expectations about the acquisitions of Mostra and CITYTECH. These and other factors that could cause ICF’s actual results to differ from those indicated in forward-looking statements are included in the "Risk Factors" section of ICF’s securities filings with the Securities and Exchange Commission. Although ICF’s expectations are based on what management believes to be reasonable assumptions, it cannot assure the expectations reflected in this document will be achieved as they are subject to risks and uncertainties that are difficult to predict and may be outside of ICF’s control. Such risks and uncertainties include the possibility that the benefits anticipated from the Mostra and CITYTECH transactions will not be fully realized, the possibility the CITYTECH transaction may not close, and other risks in connection with both the proposed CITYTECH transaction and the integration of Mostra. The forward-looking statements included herein are only made as of the date hereof, and ICF specifically disclaims any obligation to update these statements in the future.

ICF International, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(in thousands, except per share amounts)
Three months ended Twelve months ended
December 31, December 31,
2013 2012 2013 2012
Gross Revenue $ 229,759 $ 231,979 $ 949,303 $ 937,133
Direct Costs 143,146 146,879 591,516 583,195
Operating costs and expenses:
Indirect and selling expenses 68,874 64,265 272,387 263,878
Depreciation and amortization 2,886 2,731 11,238 9,789
Amortization of intangible assets 2,266   3,559   9,477   14,089  
Total operating costs and expenses 74,026   70,555   293,102   287,756  
Operating Income 12,587 14,545 64,685 66,182
Interest expense (577 ) (781 ) (2,447 ) (3,946 )
Other (expense) income (221 ) 54   (12 ) (325 )
Income before income taxes 11,789 13,818 62,226 61,911
Provision for income taxes 4,033   4,599   22,896   23,836  
Net income $ 7,756   $ 9,219   $ 39,330   $ 38,075  
Earnings per Share:
Basic $ 0.39   $ 0.47   $ 1.99   $ 1.94  
Diluted $ 0.38   $ 0.47   $ 1.95   $ 1.91  
Weighted-average Shares:
Basic 19,826   19,501   19,755   19,663  
Diluted 20,233   19,690   20,186   19,957  
Other comprehensive income:
Foreign currency translation adjustments 248   99   251   (436 )
Comprehensive income $ 8,004   $ 9,318   $ 39,581   $ 37,639  
Reconciliation of non-GAAP financial measures:

Reconciliation of Service Revenue

Revenue $ 229,759 $ 231,979 $ 949,303 $ 937,133
Subcontractor and Other Direct Costs* 58,423   59,249   239,529   231,838  
Service Revenue $ 171,336   $ 172,730   $ 709,774   $ 705,295  

Reconciliation of EBITDA

Operating Income $ 12,587 $ 14,545 $ 64,685 $ 66,182
Depreciation and amortization 5,152   6,290   20,715   23,878  
EBITDA 17,739 20,835 85,400 90,060
Acquisition-related expenses** 536   -   903   676  
Adjusted EBITDA $ 18,275   $ 20,835   $ 86,303   $ 90,736  

Reconciliation of Diluted EPS

Diluted EPS $ 0.38 $ 0.47 $ 1.95 $ 1.91
EPS impact of acquisition costs, net of tax 0.02     0.03   0.02  
Adjusted EPS $ 0.40   $ 0.47   $ 1.98   $ 1.93  

*  Subcontractor and Other Direct Costs exclude Direct Labor and Fringe.

** Acquisition-related expenses include expenses related to closed and anticipated-to-close acquisitions.

ICF International, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share amounts)
December 31, 2013 December 31, 2012
Current Assets:
Cash $ 8,953 $ 14,725
Contract receivables, net 205,062 204,938
Prepaid expenses and other 7,847 7,608
Income tax receivable 4,482   11,231  
Total current assets 226,344   238,502  
Total property and equipment, net 30,214 28,860
Other assets:
Goodwill 418,839 410,583
Other intangible assets, net 12,239 21,016
Restricted cash 1,864 2,015
Other assets 11,414   8,745  
Total Assets $ 700,914   $ 709,721  
Current Liabilities:
Accounts payable $ 45,544 $ 44,665
Accrued salaries and benefits 45,994 42,264
Accrued expenses 32,256 31,779
Deferred revenue 20,282 22,333
Deferred income taxes 6,144   5,790  
Total current liabilities 150,220   146,831  
Long-term liabilities:
Long-term debt 40,000 105,000
Deferred rent 12,912 10,599
Deferred income taxes 10,780 9,081
Other 12,911   9,460  
Total Liabilities 226,823 280,971
Commitments and Contingencies
Stockholders’ Equity:
Preferred stock, par value $.001 per share; 5,000,000 shares authorized; none issued
Common stock, $.001 par value; 70,000,000 shares authorized; 20,617,270 and 20,171,613 shares issued; and 19,764,634 and 19,559,409 shares outstanding as of December 31, 2013, and December 31, 2012, respectively 21 20
Additional paid-in capital 250,698 237,262
Retained earnings 245,907 206,577
Treasury stock (21,545 ) (13,868 )
Accumulated other comprehensive loss (990 ) (1,241 )
Total Stockholders’ Equity 474,091   428,750  
Total Liabilities and Stockholders’ Equity $ 700,914   $ 709,721  
ICF International, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
Twelve months ended
December 31,
2013 2012
Cash flows from operating activities
Net income $ 39,330 $ 38,075
Adjustments to reconcile net income to net cash provided by operating activities:
Bad debt expense 112 336
Deferred income taxes 2,434 13,637
(Gain) loss on disposal of fixed assets (15 ) 122
Non-cash equity compensation 8,891 8,770
Depreciation and amortization 20,715 23,878
Amortization of debt issue costs 476 562
Deferred rent 2,606 3,594
Changes in operating assets and liabilities, net of the effect of acquisitions:
Contract receivables 829 12,457
Prepaid expenses and other assets (3,619 ) (162 )
Accounts payable 730 2,604
Accrued salaries and benefits 3,699 (4,154 )
Accrued expenses 42 1,619
Deferred revenue (2,706 ) (2,638 )
Income tax receivable and payable 6,749 (10,451 )
Restricted cash 150 (807 )
Other liabilities 609   (201 )
Net cash provided by operating activities 81,032   87,241  
Cash flows from investing activities
Capital expenditures for property and equipment and capitalized software (14,161 ) (13,561 )
Payments for business acquisitions, net of cash received (4,763 ) (9,974 )
Net cash used in investing activities (18,924 ) (23,535 )
Cash flows from financing activities
Advances from working capital facilities 139,215 172,270
Payments on working capital facilities (204,215 ) (212,270 )
Debt issue costs (1,955 )
Proceeds from exercise of options 3,103 78
Tax benefits of stock option exercises and award vesting 1,213 804
Net payments for stockholder issuances and buybacks (7,447 ) (11,569 )
Net cash used in financing activities (68,131 ) (52,642 )
Effect of exchange rate changes on cash 251   (436 )
(Decrease) increase in cash (5,772 ) 10,628
Cash, beginning of period 14,725   4,097  
Cash, end of period $ 8,953   $ 14,725  
Supplemental disclosure of cash flow information
Cash paid during the period for:
Interest $ 2,459   $ 3,243  
Income taxes $ 13,670   $ 20,377  
Non-cash investing and financing transactions:
Fair value of contingent consideration payable in connection with acquisition $ 2,842   $  
ICF International, Inc. and Subsidiaries
Supplemental Schedule
Revenue by market Three Months Ended Twelve Months Ended
December 31, December 31,
2013 2012 2013 2012
Energy, environment, and infrastructure 41 % 40 % 39 % 39 %
Health, social programs, and consumer/financial 48 % 47 % 49 % 47 %
Public safety and defense 11 % 13 % 12 % 14 %
Total 100 % 100 % 100 % 100 %
Revenue by client Three Months Ended Twelve Months Ended
December 31, December 31,
2013 2012 2013 2012
U.S. federal government 55 % 58 % 58 % 60 %
U.S. state and local government 10 % 9 % 9 % 10 %
Non-U.S. government 5 % 4 % 5 % 3 %
Government 70 % 71 % 72 % 73 %
Commercial 30 % 29 % 28 % 27 %
Total 100 % 100 % 100 % 100 %
Revenue by contract Three Months Ended Twelve Months Ended
December 31, December 31,
2013 2012 2013 2012
Time-and-materials 52 % 48 % 52 % 49 %
Fixed-price 30 % 31 % 29 % 30 %
Cost-based 18 % 21 % 19 % 21 %
Total 100 % 100 % 100 % 100 %

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Kubernetes, Docker and containers are changing the world, and how companies are deploying their software and running their infrastructure. With the shift in how applications are built and deployed, new challenges must be solved. In his session at @DevOpsSummit at19th Cloud Expo, Sebastian Scheele, co-founder of Loodse, will discuss the implications of containerized applications/infrastructures and their impact on the enterprise. In a real world example based on Kubernetes, he will show how to ...
Without lifecycle traceability and visibility across the tool chain, stakeholders from Planning-to-Ops have limited insight and answers to who, what, when, why and how across the DevOps lifecycle. This impacts the ability to deliver high quality software at the needed velocity to drive positive business outcomes. In his general session at @DevOpsSummit at 19th Cloud Expo, Eric Robertson, General Manager at CollabNet, will discuss how customers are able to achieve a level of transparency that e...
@DevOpsSummit has been named the ‘Top DevOps Influencer' by iTrend. iTrend processes millions of conversations, tweets, interactions, news articles, press releases, blog posts - and extract meaning form them and analyzes mobile and desktop software platforms used to communicate, various metadata (such as geo location), and automation tools. In overall placement, @DevOpsSummit ranked as the number one ‘DevOps Influencer' followed by @CloudExpo at third, and @MicroservicesE at 24th.
24Notion is full-service global creative digital marketing, technology and lifestyle agency that combines strategic ideas with customized tactical execution. With a broad understand of the art of traditional marketing, new media, communications and social influence, 24Notion uniquely understands how to connect your brand strategy with the right consumer. 24Notion ranked #12 on Corporate Social Responsibility - Book of List.
Established in 1998, Calsoft is a leading software product engineering Services Company specializing in Storage, Networking, Virtualization and Cloud business verticals. Calsoft provides End-to-End Product Development, Quality Assurance Sustenance, Solution Engineering and Professional Services expertise to assist customers in achieving their product development and business goals. The company's deep domain knowledge of Storage, Virtualization, Networking and Cloud verticals helps in delivering ...
Most of us already know that adopting new cloud applications can boost a business’s productivity by enabling organizations to be more agile and ready to change course in our fast-moving and connected digital world. But the rapid adoption of cloud apps and services also brings with it profound security threats, including visibility and control challenges that aren’t present in traditional on-premises environments. At the same time, the cloud – because of its interconnected, flexible and adaptable...
In his session at @DevOpsSummit at 19th Cloud Expo, Robert Doyle, lead architect at eCube Systems, will examine the issues and need for an agile infrastructure and show the advantages of capturing developer knowledge in an exportable file for migration into production. He will introduce the use of NXTmonitor, a next-generation DevOps tool that captures application environments, dependencies and start/stop procedures in a portable configuration file with an easy-to-use GUI. In addition to captu...
SYS-CON Events announced today that SoftNet Solutions will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. SoftNet Solutions specializes in Enterprise Solutions for Hadoop and Big Data. It offers customers the most open, robust, and value-conscious portfolio of solutions, services, and tools for the shortest route to success with Big Data. The unique differentiator is the ability to architect and...
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, will be adding the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining senso...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smar...
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
@ThingsExpo has been named the Top 5 Most Influential M2M Brand by Onalytica in the ‘Machine to Machine: Top 100 Influencers and Brands.' Onalytica analyzed the online debate on M2M by looking at over 85,000 tweets to provide the most influential individuals and brands that drive the discussion. According to Onalytica the "analysis showed a very engaged community with a lot of interactive tweets. The M2M discussion seems to be more fragmented and driven by some of the major brands present in the...
In the next five to ten years, millions, if not billions of things will become smarter. This smartness goes beyond connected things in our homes like the fridge, thermostat and fancy lighting, and into heavily regulated industries including aerospace, pharmaceutical/medical devices and energy. “Smartness” will embed itself within individual products that are part of our daily lives. We will engage with smart products - learning from them, informing them, and communicating with them. Smart produc...
As ridesharing competitors and enhanced services increase, notable changes are occurring in the transportation model. Despite the cost-effective means and flexibility of ridesharing, both drivers and users will need to be aware of the connected environment and how it will impact the ridesharing experience. In his session at @ThingsExpo, Timothy Evavold, Executive Director Automotive at Covisint, will discuss key challenges and solutions to powering a ride sharing and/or multimodal model in the a...
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, will discuss the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docke...