FOR IMMEDIATE RELEASE CONTACT: Lisa Miles 703.251.8637 lisamiles@maximus.com Date: November 10, 2016

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FOR IMMEDIATE RELEASE
 
CONTACT:
Lisa Miles 703.251.8637
 
 
 
lisamiles@maximus.com
Date: November 10, 2016
 
 
 

MAXIMUS Reports Fourth Quarter and Full Year Results for Fiscal Year 2016

- Establishes Guidance for Fiscal Year 2017 -

(RESTON, Va. - November 10, 2016) - MAXIMUS (NYSE: MMS), a leading provider of government services worldwide, today reported financial results for the three months and year ended September 30, 2016.

Highlights for the fourth quarter and fiscal year 2016 include:

Fourth quarter revenue growth of 8% to a record $623.1 million and GAAP diluted earnings per share growth of 45% to $0.77

Fiscal year 2016 revenue growth of 14.5% to a record $2.4 billion and GAAP diluted earnings per share growth of 14% to a record $2.69

Cash and cash equivalents that totaled $66.2 million at September 30, 2016

Signed year-to-date contract awards of $2.1 billion, new contracts pending of $150 million, and a record sales pipeline of $4.3 billion at September 30, 2016

For the fourth quarter of fiscal year 2016, revenue increased 8% (10% on a constant currency basis) to
$623.1 million, compared to $578.7 million reported for the same period last year. The increase in revenue was driven by organic growth of 9% and acquired growth of 1%, which were partially offset by a 2% decline related to unfavorable foreign currency translation. For the fourth quarter of fiscal 2016, net income attributable to MAXIMUS totaled $50.7 million, or $0.77 of diluted earnings per share, which was better than expected due to favorability in the Company's appeals and assessments business. This compares to diluted earnings per share of $0.53 for the fourth quarter of fiscal 2015.

Revenue for fiscal year 2016 increased 14.5% (17% on a constant currency basis) to $2.4 billion, compared to $2.1 billion reported for fiscal 2015. The increase in revenue was driven by organic growth of 9% and acquired growth of 8%, which was partially offset by a 2% decline from unfavorable foreign currency translation. For fiscal year 2016, net income attributable to MAXIMUS totaled $178.4 million, or $2.69 of diluted earnings per share, which included a net benefit of $0.03 that was comprised of a $0.06 gain on the sale of the K-12 Education business, $0.01 of acquisition-related expenses, and $0.02 of cost related to a legal matter.






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Health Services Segment
Health Services Segment revenue for the fourth quarter of fiscal 2016 increased 16% (19% on a constant currency basis) to $342.1 million, compared to $296.2 million reported for the same period last year. Operating income for the fourth quarter of fiscal 2016 totaled $50.9 million (14.9% operating margin), compared to $30.5 million (10.3% operating margin) for the same period last year.

For the full fiscal year, Health Services Segment revenue increased 17% (20% on a constant currency basis) to $1.3 billion, compared to $1.1 billion for the same period last year. Fiscal 2016 operating income totaled $185.0 million (14.3% operating margin), compared to operating income of $154.3 million (13.9% operating margin) for fiscal 2015.

The increases in revenue for the fourth quarter and the full fiscal year were driven by new work, the expansion of existing contracts and, to a lesser extent, the acquisition of Ascend. Growth for both the quarter and the full year was partially offset by unfavorable currency translation. Operating margin expansion in the fourth quarter of fiscal 2016 compared to the same period last year was principally due to improvements on the Health Assessment Advisory Service contract in the United Kingdom. In addition, operating margin for fiscal 2016 benefited from solid revenue growth that outpaced growth in the administrative cost base.

U.S. Federal Services Segment
U.S. Federal Services Segment revenue for the fourth quarter of fiscal 2016 decreased 5% to $146.7 million, compared to $154.3 million reported for the same period last year, principally due to lower volumes on a large health care contract. Operating income for the fourth quarter totaled $18.6 million (12.7% operating margin), compared to $20.9 million (13.5% operating margin) for the same period last year.

For the full fiscal year, U.S. Federal Services Segment revenue increased 18% to $591.7 million, compared to $502.5 million for the same period last year. The revenue growth was driven by the acquisition of Acentia, which was partially offset by organic revenue declines of $15 million, net. This included $49 million tied to the expected closure of a customer contact center for the Federal Marketplace under the Affordable Care Act. Fiscal 2016 operating income totaled $63.4 million (10.7% operating margin), compared to operating income of $59.4 million (11.8% operating margin) for fiscal 2015.

Operating margins for the fourth quarter and the full fiscal year were lower compared to the same periods in fiscal 2015, principally due to contracts acquired as part of the Acentia acquisition that are predominantly cost reimbursable or time and materials. These types of contracts are lower risk and, therefore, carry a lower margin. As part of the segment’s long-term growth initiatives, MAXIMUS has made further investments in business development, as well as incurred additional operating expenses in support of its IT infrastructure refresh, which have increased our SG&A expense, particularly within this segment.

Human Services Segment
Human Services Segment revenue for the fourth quarter of fiscal 2016 increased 5% (6% on a constant currency basis) to $134.3 million, compared to $128.2 million for the same period last year. Operating income for the fourth quarter totaled $14.5 million (10.8% operating margin), compared to $13.4 million (10.4% operating margin) for the same period last year.

For the full fiscal year, Human Services Segment revenue increased 5% (9% on a constant currency basis) to $513.3 million, compared to $488.1 million for the same period last year. Fiscal 2016 operating income totaled $47.7 million (9.3% operating margin), compared to operating income of $60.2 million (12.3% operating margin) for fiscal 2015.



1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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The increase in revenue for the fourth quarter and the full year was principally driven by organic growth from the jobactive contract and acquired revenue, which was partially offset by unfavorable foreign currency translation. As expected operating margins for the fourth quarter improved over the same period last year due to the expected ramp-up on the jobactive contract which commenced on July 1, 2015 and was unprofitable in the fourth quarter of 2015. For full fiscal year 2016, operating margins were lower compared to fiscal year 2015 principally due to start-up costs related to the aforementioned ramp-up of the jobactive contract.

Backlog, Sales and Pipeline
Backlog was $4.0 billion at September 30, 2016 and reflects the expected lower backlog from certain large performance-based contracts such as the Health Assessment Advisory Service. Year-to-date signed contract awards at September 30, 2016 totaled $2.1 billion. New contracts pending (awarded but unsigned) totaled $150 million.

The sales pipeline at September 30, 2016 was $4.3 billion (comprising approximately $2.0 billion in proposals pending, $150 million in proposals in preparation, and $2.1 billion in opportunities tracking). The Company’s sales pipeline only reflects those opportunities where MAXIMUS expects the request for proposal will be released within the next six months. This compares to a pipeline of $3.2 billion for the same period last year.

Balance Sheet and Cash Flows
Cash and cash equivalents at September 30, 2016 totaled $66.2 million. For the fourth quarter of fiscal year 2016, cash provided by operating activities totaled $71.9 million, with free cash flow of $59.6 million. For the fiscal year 2016, cash provided by operating activities totaled $180.0 million, with free cash flow of $133.6 million.

At September 30, 2016, days sales outstanding (DSO) were within the Company’s expected range at 70, compared to 67 for the third quarter of fiscal year 2016. DSO increased on a sequential basis due to a payment delay from a large contract. This delay accounted for five DSO and subsequent to quarter close, MAXIMUS collected the outstanding receivables.

On August 31, 2016, MAXIMUS paid a quarterly cash dividend of $0.045 per share. On October 19, 2016, the Company announced a $0.045 per share cash dividend, payable on November 30, 2016 to shareholders of record on November 15, 2016.

For the full fiscal year, MAXIMUS repurchased approximately 587,000 shares for $31.3 million (a weighted average price of $53.39). Subsequent to September 30, 2016 through November 8, the Company repurchased approximately 243,000 additional shares of stock for $12.8 million (a weighted average price of $52.84). As of November 8, 2016, the Company estimates that it has $124 million available for repurchases under its Board-authorized share repurchase program.

Outlook
MAXIMUS is establishing fiscal year 2017 guidance. The Company expects fiscal year 2017 revenue to range between $2.475 billion and $2.550 billion. This revenue guidance includes unfavorable impacts of approximately $110 million, comprised of approximately $50 million related to the weakening of the British Pound, approximately $20 million related to a certain contract that the Company opted not to rebid, and approximately $40 million tied to a large health care contract in the Federal Services Segment where volumes are lower as the client evaluates the long-term plans for the future program.



1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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For fiscal year 2017, The Company expects GAAP diluted earnings per share guidance to range between $2.90 and $3.10. Approximately 93% of the Company's fiscal year 2017 forecasted revenue is in the form of backlog, option periods or extensions.

Richard Montoni, Chief Executive Officer of MAXIMUS, commented, "We are pleased to deliver double-digit revenue and earnings growth for fiscal 2016, and we look for fiscal 2017 to be another year of growth, top and bottom line. With a robust pipeline of $4.3 billion, of which approximately 60% is new work, our business development teams are keenly focused on winning new business and cultivating new longer-term opportunities. With aging populations, rising caseloads and the need for governments to do more with less, we firmly believe that macro demand trends will remain in our favor for years to come."

Accounting Standards Update to be Adopted in Fiscal Year 2017
The Company will adopt ASU No. 2016-09, Stock Compensation, Improvements to Employee Share-Based Payment Accounting in fiscal year 2017. This standard requires companies to record the income tax benefit or expense related to the exercising of stock options and the vesting of restricted stock units (RSUs) as a reduction to the provision for income taxes. The amount of the benefit depends on the Company's stock price on the exercise or vesting date. The benefit to MAXIMUS will be recorded principally in the fourth quarter of the fiscal year. During fiscal year 2016, this was directly recorded as an increase to stockholders' equity as required by the current rules in effect.

Website Presentation, Conference Call and Webcast Information
MAXIMUS will host a conference call this morning, November 10, 2016, at 9:00 a.m. (ET). The call is open to the public and can be accessed under the Investor Relations page of the Company’s website at
http://investor.maximus.com or by calling:

877.407.8289 (Domestic)/+1.201.689.8341 (International)

For those unable to listen to the live call, a replay will be available through November 24, 2016 by calling:

877.660.6853 (Domestic)/+1.201.612.7415 (International)
Replay conference ID number: 13623294


About MAXIMUS
Since 1975, MAXIMUS has operated under its founding mission of Helping Government Serve the People®, enabling citizens around the globe to successfully engage with their governments at all levels and across a variety of health and human services programs. MAXIMUS delivers innovative business process management and technology solutions that contribute to improved outcomes for citizens and higher levels of productivity, accuracy, accountability and efficiency of government-sponsored programs. With more than 18,000 employees worldwide, MAXIMUS is a proud partner to government agencies in the United States, Australia, Canada, Saudi Arabia and the United Kingdom. For more information, visit maximus.com.

Non-GAAP and Other Measures
This release refers to non-GAAP financial measures, including adjusted diluted earnings per share, free cash flow, constant currency and days sales outstanding.

We have provided a reconciliation of free cash flow to cash provided by operating activities. We believe that free cash flow is a useful basis for investors to compare our performance across periods or against our competitors. Free cash flow shows the effects of the Company’s operations and routine capital expenditure


1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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and excludes the cash flow effects of acquisitions, share repurchases, dividend payments and other financing transactions.

To provide constant currency information, we calculate fiscal year 2016 revenue for all international businesses using the exchange rates used in the comparative period in fiscal year 2015. We believe constant currency provides a useful basis for assessing the performance of the business excluding the unpredictable effects of foreign exchange fluctuations.

Days sales outstanding, or DSO, is a measure of how efficiently we manage the billing and collection of our receivable balances. We calculate DSO by dividing billed and unbilled receivable balances at the end of each quarter by revenue per day for the period. Revenue per day for a quarter is determined by dividing total revenue by 91 days.

The presentation of these non-GAAP numbers is not meant to be considered in isolation, nor as alternatives to cash flows from operating activities, revenue growth or net income as measures of performance. These non-GAAP financial measures, as determined and presented by us, may not be comparable to related or similarly titled measures presented by other companies.

Statements that are not historical facts, including statements about the Company’s confidence and strategies and the Company’s expectations about revenues, results of operations, profitability, future contracts, market opportunities, market demand or acceptance of the Company’s products are forward-looking statements that involve risks and uncertainties. These uncertainties could cause the Company’s actual results to differ materially from those indicated by such forward-looking statements and include reliance on government clients; risks associated with government contracting; risks involved in managing government projects; legislative changes and political developments; opposition from government unions; challenges resulting from growth; adverse publicity; and legal, economic, and other risks detailed in Exhibit 99.1 to the Company’s most recent Annual Report filed with the Securities and Exchange Commission, found on maximus.com.



1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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MAXIMUS, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)

 
Three Months Ended September 30,
 
Twelve Months Ended September 30,
 
2016
 
2015
 
2016
 
2015
 
(Unaudited)
 
(Unaudited)
 
(Unaudited)
 
 
Revenue
$
623,091

 
$
578,683

 
$
2,403,360

 
$
2,099,821

Cost of revenue
470,161

 
453,376

 
1,841,169

 
1,587,104

Gross profit
152,930

 
125,307

 
562,191

 
512,717

Less:
 
 
 
 
 
 
 
Selling, general and administrative expenses
68,343

 
60,442

 
268,259

 
238,792

Amortization of intangible assets
3,449

 
3,166

 
13,377

 
9,348

Acquisition-related expenses
257

 
172

 
832

 
4,745

Add:
 
 
 
 
 
 
 
Gain on sale of a business
427

 

 
6,880

 

Operating income
81,308

 
61,527

 
286,603

 
259,832

Less:
 
 
 
 
 
 
 
Interest expense
843

 
709

 
4,134

 
1,398

Add:
 
 
 
 
 
 
 
Other income, net
97

 
257

 
3,499

 
1,385

Income before income taxes
80,562

 
61,075

 
285,968

 
259,819

Provision for income taxes
29,375

 
24,663

 
105,808

 
99,770

Net income
51,187

 
36,412

 
180,160

 
160,049

Income attributable to noncontrolling interests
444

 
975

 
1,798

 
2,277

Net income attributable to MAXIMUS
$
50,743

 
$
35,437

 
$
178,362

 
$
157,772

Basic earnings per share attributable to MAXIMUS
$
0.77

 
$
0.53

 
$
2.71

 
$
2.37

Diluted earnings per share attributable to MAXIMUS
$
0.77

 
$
0.53

 
$
2.69

 
$
2.35

Dividends paid per share
$
0.045

 
$
0.045

 
$
0.18

 
$
0.18

Weighted average shares outstanding:
 
 
 
 
 
 
 
Basic
65,778

 
66,466

 
65,822

 
66,682

Diluted
66,294

 
67,133

 
66,229

 
67,275














1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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MAXIMUS, Inc.
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
 
September 30,
 
2016
 
2015
 
(Unaudited)
 
 
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
66,199

 
$
74,672

Accounts receivable — billed and billable, net of reserves of $4,226 and $3,385
444,357

 
396,177

Accounts receivable — unbilled
36,433

 
30,929

Income taxes receivable
17,273

 
7,310

Prepaid expenses and other current assets
56,718

 
52,819

Total current assets
620,980

 
561,907

Property and equipment, net
131,569

 
137,830

Capitalized software, net
30,139

 
32,483

Goodwill
397,558

 
376,302

Intangible assets, net
109,027

 
102,358

Deferred contract costs, net
18,182

 
19,126

Deferred compensation plan assets
23,307

 
19,310

Deferred income taxes
8,644

 
11,058

Other assets
9,413

 
11,184

Total assets
$
1,348,819

 
$
1,271,558

LIABILITIES AND SHAREHOLDERS’ EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable and accrued liabilities
$
150,711

 
$
155,411

Accrued compensation and benefits
96,480

 
99,700

Deferred revenue
73,692

 
77,642

Income taxes payable
7,979

 
11,709

Long-term debt, current portion
277

 
356

Other liabilities
11,617

 
11,562

Total current liabilities
340,756

 
356,380

Deferred revenue, less current portion
40,007

 
52,954

Deferred income taxes
16,813

 
6,546

Long-term debt
165,338

 
210,618

Deferred compensation plan liabilities, less current portion
24,012

 
20,635

Other liabilities
8,753

 
8,726

Total liabilities
595,679

 
655,859

Commitments and contingencies
 
 
 
Shareholders’ equity:
 
 
 
Common stock
461,679

 
446,132

Accumulated other comprehensive income
(36,169
)
 
(22,365
)
Retained earnings
323,571

 
188,611

Total MAXIMUS shareholders’ equity
749,081

 
612,378

Noncontrolling interests
4,059

 
3,321

Total equity
753,140

 
615,699

Total liabilities and equity
$
1,348,819

 
$
1,271,558



1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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MAXIMUS, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
 
 
Three Months Ended September 30,
 
Twelve Months Ended September 30,
 
 
2016
 
2015
 
2016
 
2015
 
 
(Unaudited)
 
(Unaudited)
 
(Unaudited)
 
 
Cash flows from operating activities:
 
 
 
 
 
 
 
 
Net income
 
$
51,187

 
$
36,412

 
$
180,160

 
$
160,049

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
 
 
 
 
Depreciation and amortization of property, plant, equipment and capitalized software
 
19,158

 
9,232

 
58,404

 
46,849

Amortization of intangible assets
 
3,449

 
3,166

 
13,377

 
9,348

Deferred income taxes
 
7,399

 
9,728

 
5,652

 
807

Stock compensation expense
 
4,933

 
4,452

 
18,751

 
17,237

Gain on sale of a business
 
(427
)
 

 
(6,880
)
 

Changes in assets and liabilities, net of effects of business combinations:
 
 
 
 
 
 
 
 
Accounts receivable — billed and billable
 
(24,517
)
 
(22,344
)
 
(51,986
)
 
(103,774
)
Accounts receivable — unbilled
 
(34
)
 
(3,120
)
 
(5,590
)
 
(911
)
Prepaid expenses and other current assets
 
(6,405
)
 
(2,979
)
 
(2,027
)
 
(6,475
)
Deferred contract costs
 
(1,354
)
 
145

 
(398
)
 
(7,245
)
Accounts payable and accrued liabilities
 
18,246

 
(713
)
 
(2,371
)
 
44,351

Accrued compensation and benefits
 
9,105

 
1,389

 
(869
)
 
(3,157
)
Deferred revenue
 
42

 
15,524

 
(11,661
)
 
47,948

Income taxes
 
(12,160
)
 
(28,342
)
 
(13,125
)
 
9,134

Other assets and liabilities
 
3,272

 
2,687

 
(1,411
)
 
(7,944
)
Cash provided by operating activities
 
71,894

 
25,237

 
180,026

 
206,217

 
 
 
 
 
 
 
 
 
Cash flows from investing activities:
 
 
 
 
 
 
 
 
Acquisition of businesses, net of cash acquired
 
85

 
400

 
(46,651
)
 
(289,212
)
Purchases of property and equipment and capitalized software costs
 
(12,288
)
 
(31,982
)
 
(46,391
)
 
(105,149
)
Proceeds from the sale of a business
 

 

 
5,515

 

Other
 
43

 
83

 
424

 
489

Cash used in investing activities
 
(12,160
)
 
(31,499
)
 
(87,103
)
 
(393,872
)
 
 
 
 
 
 
 
 
 
Cash flows from financing activities:
 
 
 
 
 
 
 
 
Cash dividends paid
 
(2,921
)
 
(2,961
)
 
(11,701
)
 
(11,852
)
Repurchases of common stock
 

 
(50,171
)
 
(33,335
)
 
(82,787
)
Stock compensation tax benefit
 
5,172

 
10,682

 
5,172

 
9,474

Tax withholding related to RSU vesting
 
(17
)
 

 
(11,614
)
 
(12,451
)
Stock option exercises
 
341

 
347

 
546

 
868

Borrowings under credit facility
 
10,000

 
75,000

 
149,823

 
330,993

Repayment under credit facility
 
(55,383
)
 
(31,499
)
 
(195,200
)
 
(121,611
)
Other
 

 

 
(533
)
 
(75
)
Costs for expansion of credit facility
 

 

 

 
(1,444
)
Cash (used in)/provided by financing activities
 
(42,808
)
 
1,398

 
(96,842
)
 
111,115

 
 
 
 
 
 
 
 
 
Effect of exchange rate changes on cash
 
(1,336
)
 
(2,341
)
 
(4,554
)
 
(6,900
)
 
 
 
 
 
 
 
 
 
Net (decrease)/increase in cash and cash equivalents
 
15,590

 
(7,205
)
 
(8,473
)
 
(83,440
)
 
 
 
 
 
 
 
 
 
Cash and cash equivalents, beginning of period
 
50,609

 
81,877

 
74,672

 
158,112

 
 
 
 
 
 
 
 
 
Cash and cash equivalents, end of period
 
$
66,199

 
$
74,672

 
$
66,199

 
$
74,672



1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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MAXIMUS, Inc.
SEGMENT INFORMATION
(Amounts in thousands)
 
 
Three Months Ended September 30,
 
Twelve Months Ended September 30,
 
 
2016
 
% (1)
 
2015
 
% (1)
 
2016
 
% (1)
 
2015
 
% (1)
 
 
(Unaudited)
 
 
 
(Unaudited)
 
 
 
(Unaudited)
 
 
 
 
 
 
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Health Services
 
$
342,135

 
100
%
 
$
296,201

 
100
%
 
$
1,298,304

 
100
%
 
$
1,109,238

 
100
%
U.S. Federal Services
 
146,651

 
100
%
 
154,279

 
100
%
 
591,728

 
100
%
 
502,484

 
100
%
Human Services
 
134,305

 
100
%
 
128,203

 
100
%
 
513,328

 
100
%
 
488,099

 
100
%
Total
 
$
623,091

 
100
%
 
$
578,683

 
100
%
 
$
2,403,360

 
100
%
 
$
2,099,821

 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross Profit:
 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
Health Services
 
$
80,717

 
23.6
%
 
$
54,575

 
18.4
%
 
$
292,181

 
22.5
%
 
$
254,108

 
22.9
%
U.S. Federal Services
 
37,529

 
25.6
%
 
36,284

 
23.5
%
 
138,168

 
23.3
%
 
118,646

 
23.6
%
Human Services
 
34,684

 
25.8
%
 
34,448

 
26.9
%
 
131,842

 
25.7
%
 
139,963

 
28.7
%
Total
 
$
152,930

 
24.5
%
 
$
125,307

 
21.7
%
 
$
562,191

 
23.4
%
 
$
512,717

 
24.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selling, general and administrative expense:
 
 
 
 

 
 
 
 

 
 
 
 

 
 
 
 
Health Services
 
$
29,843

 
8.7
%
 
$
24,068

 
8.1
%
 
$
107,155

 
8.3
%
 
$
99,815

 
9.0
%
U.S. Federal Services
 
18,971

 
12.9
%
 
15,381

 
10.0
%
 
74,792

 
12.6
%
 
59,252

 
11.8
%
Human Services
 
20,151

 
15.0
%
 
21,095

 
16.5
%
 
84,157

 
16.4
%
 
79,719

 
16.3
%
Other
 
(622
)
 
NM

 
(102
)
 
NM

 
2,155

 
NM

 
6

 
NM

Total
 
$
68,343

 
11.0
%
 
$
60,442

 
10.4
%
 
$
268,259

 
11.2
%
 
$
238,792

 
11.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating income:
 
 
 
 

 
 
 
 

 
 
 
 

 
 
 
 
Health Services
 
$
50,874

 
14.9
%
 
$
30,507

 
10.3
%
 
$
185,026

 
14.3
%
 
$
154,293

 
13.9
%
U.S. Federal Services
 
18,558

 
12.7
%
 
20,903

 
13.5
%
 
63,376

 
10.7
%
 
59,394

 
11.8
%
Human Services
 
14,533

 
10.8
%
 
13,353

 
10.4
%
 
47,685

 
9.3
%
 
60,244

 
12.3
%
Amortization of intangible assets
 
(3,449
)
 
NM

 
(3,166
)
 
NM

 
(13,377
)
 
NM

 
(9,348
)
 
NM

Acquisition-related expenses (2)
 
(257
)
 
NM

 
(172
)
 
NM

 
(832
)
 
NM

 
(4,745
)
 
NM

Gain on sale of a business
 
427

 
NM

 

 
NM

 
6,880

 
NM

 

 
NM

Other (3)
 
622

 
NM

 
102

 
NM

 
(2,155
)
 
NM

 
(6
)
 
NM

Total
 
$
81,308

 
13.0
%
 
$
61,527

 
10.6
%
 
$
286,603

 
11.9
%
 
$
259,832

 
12.4
%


(1)    Percentage of respective segment revenue. Percentages considered not meaningful are marked “NM.”
(2)
Acquisition-related expenses are costs directly incurred from the purchases of Assessments Australia in the first quarter of fiscal year 2016, the purchase of Ascend in the second quarter of fiscal year 2016 and the purchases of Acentia and Remploy in fiscal year 2015, as well as other transaction-related activity.
(3)
"Other" relates to a litigation matter from fiscal year 2014.


1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

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q4fy16earnings_image1a01.jpg


MAXIMUS, Inc.
FREE CASH FLOW
(Non-GAAP measure)
(Amounts in thousands)
(Unaudited)

 
 
Three Months Ended September 30,
 
Twelve Months Ended September 30,
 
 
2016
 
2015
 
2016
 
2015
Cash provided by operating activities
 
$
71,894

 
$
25,237

 
$
180,026

 
$
206,217

Purchases of property and equipment and capitalized software costs
 
(12,288
)
 
(31,982
)
 
(46,391
)
 
(105,149
)
Free cash flow
 
$
59,606

 
$
(6,745
)
 
$
133,635

 
$
101,068

 
 
 
 
 
 
 
 
 



-XXX-


1891 METRO CENTER DRIVE | RESTON, VIRGINIA 20190 | 703.251.8500 | 703.251.8240 FAX | MAXIMUS.COM

Page 10