Maximus, Inc. · NYSE:MMS
Maximus — Q3 FY2014 Earnings Presentation
18 slides from Maximus's earnings presentation, Aug 7, 2014
Slide 1: Fiscal 2014 Third Quarter Earnings
Fiscal 2014 Third Quarter Earnings Richard J. Nadeau Chief Financial Officer and Treasurer August 7, 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: Total Company Results
Total Company Results ($ in millions) Q3 FY14 Q3 FY13 % Change Revenue • Q3 FY14 revenue increased 26% to Health Services $ 305.6 $ 217.9 40% $419.9M compared to the same Human Services 114.3 116.4 (2%) quarter last year, driven by the Total $ 419.9 $ 334.3 26% Health Services Segment Operating Inco
Slide 4: Health Services Segment
Health Services Segment ($ in millions) Q3 FY14 Q3 FY13 % Change Revenue Health Services $ 305.6 $ 217.9 40% Operating Income Health Services $ 42.2 $ 34.4 23% Operating Margin % 13.8% 15.8% Revenue • Another solid quarter. Q3 FY14 revenue increased 40% • Top-line increases driven by: 1. New work an
Slide 5: Human Services Segment
Human Services Segment ($ in millions) Q3 FY14 Q3 FY13 % Change Revenue Human Services $ 114.3 $ 116.4 (2%) Operating Income Human Services $ 13.0 $ 11.0 18% Operating Margin % 11.4% 9.5% Revenue • Q3 FY14 revenue is slightly lower than last year, principally due to adverse currency impacts Operatin
Slide 6: Balance Sheet and Cash Flows
Balance Sheet and Cash Flows Cash Flows in Q3 • Benefitted from strong earnings and solid collections that led to lower DSOs of 63 days • DSOs will likely rise in Q4 to within the previously stated range of 65-80 days Reconciliation to Free Cash Flow Cash Deployment • Share repurchases − Q3 FY14, pu
Slide 7: Reiterating FY 14 Guidance
Reiterating FY 14 Guidance • Full year guidance for fiscal year ending September 30, 2014 remains unchanged • We expect a bias towards the top end of both our revenue and earnings guidance • Cash flow guidance remains unchanged 7
Slide 8: Fiscal 2014 Third Quarter Earnings
Fiscal 2014 Third Quarter Earnings Richard A. Montoni President and Chief Executive Officer August 7, 2014 8
Slide 9: Changes to the Leadership for Future Growth
Changes to the Leadership for Future Growth New Chief Financial Bruce Caswell appointed Richard Montoni to Officer, Rick Nadeau to President continue as CEO • Comes to MAXIMUS • Responsible for operational • Primary focus on the Company’s from SRA International execution and organic growth of strate
Slide 10: New U.S. Contract – Debt Management Services
New U.S. Contract – Debt Management Services • Successfully launched operations – on schedule – for the new debt management contract with U.S. Department of Education • Helping administer a portfolio of approximately five million borrowers whose student loans are in default status • Operations inclu
Slide 11: New U.K. Contract – Health and Work Service
New U.K. Contract – Health and Work Service Department for Work and Pensions selected Health Management for new program Terms • 63-month contract with expected total contract value of up to approximately $226 million • Anticipate initial start-up loss due to contract nature; overall program economic
Slide 12: Additional Work for Job Services Australia
Additional Work for Job Services Australia Reallocated work under Job Services Australia (JSA) program • Strong performance under Star Rating program resulted in the award of 18 new sites • Increases caseload by approximately 15% to more than 100,000 job seekers • Provides approximately $15 million
Slide 13: International Opportunities
International Opportunities Future international growth may come from: • New countries that are increasing their propensity to outsource • Current geographies with expanded needs For example, in Australia: • Substantive opportunities for growth • Exact timing of opportunities is not precisely known
Slide 14: US Operations and ACA Efforts
US Operations and ACA Efforts See Future opportunities related to the support of the Affordable Care Act (ACA) Current status for customer contact centers for state and federal exchanges • Gearing up for next open enrollment period and we will adapt to dynamic environment as governments apply “lesso
Slide 15: Rebids
Rebids • 15 contracts worth a total of $225 million up for rebid in FY 14 • Won or received extensions on 11 with a total contract value of $150 million • Year-to-date, lost 2 small rebids with a combined total contract value of about $20 million, leaving only 2 rebids left with a total contract val
Slide 16: New Awards and Sales Pipeline
New Awards and Sales Pipeline At June 30, 2014: • Signed $1.1 billion in year-to-date contract awards • Additional $428 million in contracts pending (notified of award and in contract negotiations) • Sales pipeline reached $3.0 billion and driven, in part, by: • Contract rebid in Australia • New opp
Slide 17: Fiscal 2015 Commentary
Fiscal 2015 Commentary We are pleased with our: • Progress in FY 14 • Expectations for the remainder of the year • Prospects for FY 15 and beyond Fiscal Year 2015 Headwinds 1. Reduced revenue from ACA and appeals work for the Medicare program • Lion’s share of ACA work is recurring, but as expected
Slide 18: Conclusion
Conclusion FY 15 shaping up to be a growth year, both top- and bottom-line • Conducting annual planning process and will provide formal guidance in November • Management team remains focused on dynamics that best position MAXIMUS for future, multi-year growth • Over the long-term, believe revenue an