Slide 1: Fiscal 2015 Second Quarter Earnings
Fiscal 2015 Second Quarter Earnings Richard J. Nadeau Chief Financial Officer May 7, 2015
Slide 2: Forward-looking Statements & Non-GAAP Information
Forward-looking Statements & Non-GAAP Information These slides should be read in conjunction with the Company’s most recent quarterly earnings press release, along with listening to or reading a transcript of the comments of Company management from the Company’s most recent quarterly earnings confer
Slide 3: Total Company Results – Second Quarter
Revenue Health Services $ 370.4 $ 323.6 14% Human Services 111.4 115.4 (3%) Total $ 481.8 $ 439.0 10% Operating Income Health Services $ 51.1 $ 49.7 3% Human Services 13.9 17.3 (20%) Intangibles Amortization (1.4) (1.5) Other (1.6) (0.6) Total $ 62.0 $ 65.0 (5%) Operating Margin % 12.9% 14.8%Net Inc
Slide 4: Health Services Segment
Health Services Segment Revenue New work and expansion of existing contracts helped fuel the top line Revenue grew 14% Operating Income & Margin Operating income increased to $51.1M Solid operating margin of 13.8% Segment outpaced Q2 expectations due to contract amendments that were larger than prev
Slide 5: Human Services Segment
Human Services Segment Revenue Adversely impacted by currency exchange rates Segment revenue lower compared to Q2 FY14 On a constant currency basis, Segment revenue would have increased 4% Operating Income & Margin Operating income totaled $13.9M Operating margin was strong at 12.5% As expected, bot
Slide 6: Cash Flows and Balance Sheet
Cash Flows and Balance Sheet Reconciliation to Free Cash Flow Negative free cash flow principally driven by: 1) DSOs and 2) Cap Ex Investments 1. Days Sales Outstanding (DSOs) As expected, DSOs increased in the quarter mostly due to new U.K. contracts At March 31, DSOs were 70 days, well within our
Slide 7: Credit Facility Agreement & Acentia Acquisition
Credit Facility Agreement & Acentia Acquisition Amended Credit Facility Agreement Expanded facility for revolving line of credit up to $400M and uncommitted increase option up to additional $200M Facility is available for general corporate purposes, including working capital, cap ex and selected acq
Slide 8: Remploy Transaction
Remploy Transaction We recommend that investors view this largely as an acquisition of a single contract and the incumbent workforce of approximately 850 experienced personnel Remploy will contribute approximately $30M to $35M (USD) in revenue for remainder of our FY15 and the vast majority relates
Slide 9: Drivers to Fiscal 2015 and Fiscal 2016 Guidance
Drivers to Fiscal 2015 and Fiscal 2016 Guidance FY16 Model Variables Volumes Outcomes on performance-based contracts Currency exchange rates Legislative changes FY15 Quarter Trends Q3 expected to be strongest quarter in FY15 Q4 top and bottom line lower than Q3 due to Australia start-up loss Fiscal
Slide 10: Fiscal 2015 Second Quarter Earnings – Chief Executive Officer
Fiscal 2015 Second Quarter Earnings Richard Montoni Chief Executive Officer May 7, 2015
Slide 11: Contributions for Long-Term Growth
Contributions for Long-Term Growth Several positive developments in both segments that bring meaningful contributions to our long-term growth strategy: Acentia acquisition Remploy joint venture Expanded scope of work in Australia These developments and organic growth from new and existing programs r
Slide 12: Human Services Australia
Human Services Australia Recent rebid win and strong historical performance further expand our footprint Secured five-year, $940M rebid, which includes the jobactive program (formerly known as Job Services Australia) and the Work for the Dole program Rebid increases scope of work: 1.Market share for
Slide 13: Human Services – United Kingdom
Human Services – United Kingdom Completed Remploy acquisition in April 70% partnership with highly regarded organization (employees maintain 30%) Renowned for assisting people with complex barriers into employment; complements our existing portfolio Primary provider for Work Choice, a government emp
Slide 14: Health Services – Acentia Acquisition
Health Services – Acentia Acquisition A new growth platform for our U.S. federal services business Provides us with additional contract vehicles and access to federal government agencies Federal government agencies seek support from vendors through three different channels: 1) Contract vehicles 2) F
Slide 15: Affordable Care Act – Second Open Enrollment
Affordable Care Act – Second Open Enrollment The Affordable Care Act’s second open enrollment period was very successful; getting closer to steady state as we look ahead to OE3 Total ACA revenue was stronger than initial expectations due to better-than-expected repeat work and additional support ser
Slide 16: Health Services – United Kingdom
Health Services – United Kingdom Successfully launched the Health Assessment Advisory Service (HAAS) on March 1 Conduct assessments for individuals seeking certain disability benefits Start-up going well and working to achieve program goals for improved service Increasing the number of healthcare pr
Slide 17: New Awards and Pipeline
New Awards and Pipeline At March 31, 2015: Record sales of year-to-date signed contract awards Sales pipeline 18% higher compared to the same period last year On a sequential basis, pipeline was lower compared to the Q1 FY15 – expected as opportunities moved out of the pipeline and converted into ne
Slide 18: Conclusion and Appreciation
Conclusion and Appreciation Pleased to have introduced several new initiatives that bolster our existing platforms for long-term growth Equally excited with preliminary guidance for fiscal 2016, which represents another year of solid growth (much of which is organic) Our people are at the heart of o