Maximus, Inc. · NYSE:MMS
Maximus — Q1 FY2014 Earnings Presentation
22 slides from Maximus's earnings presentation, Feb 6, 2014
Slide 1: Fiscal 2014 First Quarter Earnings
Fiscal 2014 First Quarter Earnings David N. Walker Chief Financial Officer and Treasurer February 6, 2014 1
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: Selected Financial Results from Continuing Operations
Selected Financial Results from Continuing Operations Q1 FY14 Q1 FY13 % ($mm, except per share data) Q1 FY14 Results Actual Actual* Change Revenue • Revenue grew 42%, driven by the Health Services $ 299.2 $ 176.0 70% forecasted growth in domestic health business, much of which was tied to Human Serv
Slide 4: Health Services Segment
Health Services Segment Q1 FY14 Q1 FY13 % ($ in millions) Actual Actual Change Revenue Health Services $ 299.2 $ 176.0 70% Operating Income Health Services $ 41.6 $ 20.6 101% Operating Margin % 13.9% 11.7% Revenue • Top-line increases fueled principally by organic growth resulting from new work and
Slide 5: Human Services Segment
Human Services Segment Q1 FY14 Q1 FY13 % ($ in millions) Actual Actual Change Revenue Human Services $ 107.4 $ 110.3 (3%) Operating Income Human Services $ 11.8 $ 13.7 (14%) Operating Margin % 10.9% 12.4% Revenue • Q1 revenue decreased 3% to $107.4 million; on a constant currency basis, revenue woul
Slide 6: Balance Sheet and Cash Flows
Balance Sheet and Cash Flows Cash Flows • Strong Q1 cash flow driven by increased earnings and receivables collections • DSOs improved on a sequential basis to 67 days in the quarter (target range of 65-80 days in place since Q4 FY08) Reconciliation to Free Cash Flow Share Buybacks • In Q1, purchase
Slide 7: Increasing FY 14 Guidance
Increasing FY 14 Guidance • Seasonal revenue and earnings pattern for MAXIMUS has changed; based on what we know today, expect to experience stronger results in the first half of each fiscal year associated with the open enrollment period for the HIX under the ACA • Several changes uplifting our gui
Slide 8: Fiscal 2014 First Quarter Earnings
Fiscal 2014 First Quarter Earnings Richard A. Montoni President and Chief Executive Officer February 6, 2014 8
Slide 9: Achieving a Solid Start to Fiscal 2014
Achieving a Solid Start to Fiscal 2014 • Solid start to fiscal 2014 with top- and bottom- line results that beat expectations; raising outlook for FY 14 • Even more impressive results within a demanding market environment for private- sector government partners that operate highly visible health and
Slide 10: Helping Clients Address ACA Challenges
Helping Clients Address ACA Challenges • As governments faced problems with the exchange technology, our health team found opportunities to provide alternatives and implement comprehensive contingency plans for existing and new clients • Our solutions allowed exchange workflow to continue while our
Slide 11: Seeing Increased Activity in HIX Contact Centers
Seeing Increased Activity in HIX Contact Centers • Volumes in many of our HIX contact centers came on strong the last six weeks of calendar 2013 ‒ Added 1,300+ staff ‒ Surge in calls from consumers unable to enroll into health plans online and needed assistance over the phone ‒ Many consumers trying
Slide 12: Improving HIX Workflow for Cover Oregon
Improving HIX Workflow for Cover Oregon • Provided operational review of business processes that led to us providing call center and other overflow capacity to assist consumers in completing enrollments • Operational assistance eased workload from exchange workers overwhelmed by high volumes of pape
Slide 13: Overcoming an Influx of Applications in Colorado
Overcoming an Influx of Applications in Colorado • Helped Colorado overcome an influx of applications through our existing contract vehicle and business process re-engineering; consumers must be deemed ineligible for Medicaid before being considered for a subsidy; state experienced a surge in consum
Slide 14: Responding to Medicaid Transformation
Responding to Medicaid Transformation • ACA to serve as a multi-year growth driver for MAXIMUS; some states likely to operate their own exchanges over the next several years, as well as enhance public health insurance programs, including expanding Medicaid • Kaiser Family Foundation predicts 2014 as
Slide 15: Remaining Engaged with the Duals Market
Remaining Engaged with the Duals Market • Engaged on some dual demonstration projects • Dozens of governors made this a priority agenda item as they look for real solutions for these “super utilizers” of Medicaid and Medicare • While not a large financial contribution to MAXIMUS, the duals market is
Slide 16: Continuing Medicaid Review Work in Illinois
Continuing Medicaid Review Work in Illinois • Received some very positive news in Illinois where we had been working with the state to help root out Medicaid fraud • Eligibility and Enrollment Verification project designed to help ensure that only those eligible for Medicaid are actually receiving c
Slide 17: Delivering Solid Results in Federal Market
Delivering Solid Results in Federal Market • Federal Services business again delivered solid financial results • Reflects the team’s ability to deliver on the increased level of appeals • The MAXIMUS Federal team has done a great job to manage increased volumes, while at the same time winning new wo
Slide 18: Expanding Geographic Footprint in Australia
Expanding Geographic Footprint in Australia • Recently completely a small tuck-in acquisition to complement our human services business in Australia • Acquired workforce services assets from Centacare, a provider of welfare-to-work and disability employment services under the Job Services Australia
Slide 19: Contract Rebids
Contract Rebids • 2014 will be a light year for rebids and overall total awards • Thus far, we’re pleased with our progress • Of the 15 contracts worth a total of $225 million up for bid, we’ve won 3 for a total contract value of $46 million 19
Slide 20: New Awards and Sales Pipeline
New Awards and Sales Pipeline New Awards December 31, 2013 YTD signed awards $347 million New contracts pending $50 million Sales Opportunities December 31, 2013 Total pipeline $2.4 billion At December 31, 2013: • Signed $347 million in new contract awards • Additional $50 million of “awarded but un
Slide 21: Conclusion
Conclusion • Plans for long-term growth continue to be shaped by our three strategic priorities: ‒ Enhancing our U.S. operations by supporting clients through the next phase of the Affordable Care Act ‒ Growing our federal business ‒ Expanding our international operations with health and human servi
Slide 22: Thank You to CFO David Walker
Thank You to CFO David Walker • Thank you to our Chief Financial Officer, David Walker, for all that he’s done to drive success for MAXIMUS • In December, David announced his intent to retire, but will remain with the Company to provide support for special projects • We kicked off the search process