Slide 1: Q2 2012 MAXIMUS, Inc. Earnings Conference Call
THOMSON REUTERS STREETEVENTS EDITED TRANSCRIPT MMS - Q2 2012 MAXIMUS, Inc. Earnings Conference Call EVENT DATE/TIME: MAY 03, 2012 / 1:00PM GMT OVERVIEW: MMS reported 2Q12 revenue of $243.5m. 2Q12 GAAP income from continuing operations (net of taxes) was $14.2m. 2Q12 GAAP diluted EPS from continuing
Slide 2: Fiscal 2012 Second Quarter Earnings
Slide: 1 Title: David N. Walker Chief Financial Officer and Treasurer May 3, 2012 Fiscal 2012 Second Quarter Earnings A number of statements being made today will be forward-looking in nature. Such statements are only predictions and actual events or results may differ materially as a result of risk
Slide 3: Selected Financial Results from Continuing Operations
Slide: 2 Title: Selected Financial Results from Continuing Operations *All numbers reflect the two-for-one stock split Q2 revenue grew 7% compared to last year, driven by Health Services and offset by lower revenue in Human Services due to the planned ramp up in the UKQ2 operating income, excluding
Slide 4: Health Services Segment
Slide: 3 Title: Health Services Segment Q2 revenue increased 17% to $161.2 million driven by the managed care expansion in Texas, organic growth from new work and strong volumes in existing programs. Completed contractually planned activities for the managed care roll out in Texas which bolstered re
Slide 5: Human Services Segment
Slide: 4 Title: Human Services Segment Q2 revenue totaled $82.3 million and lower than the previous year due to transition and associated revenue ramp up on the new UK Work Programme contract As expected, losses in the UK peaked in Q2 and we still remain on track for the contract to break even in Q4
Slide 6: Updated Guidance for the UK Contract
Slide: 5 Title: Updated Guidance for the UK Contract FY12 Headwind FY13 Boomerang Program ties vendors to longer-term outcome-based payments; we are starting to achieve confirming data points that provide us with better trend data, improve visibility and allow us to update our financial modelNow exp
Slide 7: Balance Sheet and Cash Flows
Slide: 6 Title: Balance Sheet and Cash Flows Other Placeholder: Net income contributed to strong cash flows; exceptionally strong cash flows due to solid receivable collections with DSOs of 55 daysCash provided by operating activities from continuing operations of $41.5 million in the quarter, with
Slide 8: Updating FY 2012 Guidance
Slide: 7 Title: Updating FY 2012 Guidance Raising revenue guidance from $980M - $1.015M to $1.030B - $1.060BExpect PSI acquisition to bring additional revenue of $55M - $60M for FY12 (40% attributable to the Health Services Segment and 60% attributable to the Human Services SegmentStill expect fisca
Slide 9: Fiscal 2012 Second Quarter Earnings
Slide: 8 Title: Richard A. Montoni President and Chief Executive Officer May 3, 2012 Fiscal 2012 Second Quarter Earnings
Slide 10: Other Placeholder: Pleased to report another solid quarter; on track to achieve full-year guidanceOne
Slide: 9 Other Placeholder: Pleased to report another solid quarter; on track to achieve full-year guidanceOne of our short-term goals was to make qualified acquisitions; we’ve been deliberately selective, seeking opportunities that complement and fit well within our current business portfolio; seek
Slide 11: PSI Acquisition: Health Services
Slide: 10 Title: PSI Acquisition: Health Services The acquisition of PSI brings seven new Medicaid and CHIP contracts, including marquee CHIP clients, such as Georgia and FloridaWith the addition of PSI’s health portfolio, MAXIMUS serves an additional two million CHIP and Medicaid beneficiariesPSI b
Slide 12: CHIP Market Presence Grows by Four States
Slide: 11 Title: CHIP Market Presence Grows by Four States
Slide 13: Medicaid Market Presence Grows by Two States & DC
Slide: 12 Title: Medicaid Market Presence Grows by Two States & DC
Slide 14: PSI Acquisition: Human Services
Slide: 13 Title: PSI Acquisition: Human Services The acquisition of brings on new welfare-to-work and consulting contracts and meaningfully grows our market share in child supportPSI brings new qualifications that now open up entirely new adjacent child support markets where MAXIMUS has historically
Slide 15: Enhanced Child Support & Workforce Services Presence
Slide: 14 Title: Enhanced Child Support & Workforce Services Presence Acquisition of PSI brings an additional 44 child support and 4 workforce services contracts to the MAXIMUS Human Services portfolio.
Slide 16: More Resources for Future Opportunities
Slide: 15 Other Placeholder: PSI offers additional operational resources to tackle the increasing demand and fill in gaps where we may have been resource constrained in the past As market demand for our services continues to increase, acquisition brings more resources to bear as we grow the business
Slide 17: U.S. Health Care Reform Update
Slide: 16 Title: U.S. Health Care Reform Update While we can’t speculate on the outcome of the ACA hearings, we have a completed a thorough analysis of our strategy under the various potential outcomesOne variation is a gradual ramp for the establishment of exchanges on a state-by-state basis; April
Slide 18: Update on International Operations
Slide: 17 Title: Update on International Operations In the UK, Work Programme operations running at full speed; still expect to break even in Q4 of FY12; lower revenue forecast for the year balanced by the recent process modifications implemented by DWP are expected to improve the outcome verificati
Slide 19: New Awards and Sales Pipeline
Slide: 18 Title: New Awards and Sales Pipeline Investors should expect routine fluctuations among the new sales and pipeline categories, driven by the different stages in the procurement process, as well as the timing of when contracts are awarded and ultimately signed. Includes $450 million extensi
Slide 20: Conclusion
Slide: 19 Title: Conclusion Other Placeholder: Making solid progress on our short-term goals Successfully ramping up operations in the UK and remain on track to achieve breakeven status in the fourth quarter Continue to move forward with our business development plans for winning our fair share of h