New Jersey | 22-1899798 | ||||||||||||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||||||||||||||
3565 Piedmont Road, | Building 3, | Suite 700 | 30305 | ||||||||||||||
Atlanta, | Georgia | (Zip code) | |||||||||||||||
(Address of principal executive offices) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | |||||||||
Common Stock | DLHC | Nasdaq | Capital Market |
Large accelerated filer o | ☐ | Accelerated filer o | ||||||||||||
Non-accelerated filer | x | Smaller Reporting Company | ☒ | |||||||||||
Emerging Growth Company | ☐ |
Page No. | |||||
(unaudited) | (unaudited) | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Revenue | $ | 66,440 | $ | 61,555 | $ | 327,940 | $ | 180,913 | ||||||||||||||||||
Cost of operations: | ||||||||||||||||||||||||||
Contract costs | 49,668 | 48,365 | 271,184 | 143,092 | ||||||||||||||||||||||
General and administrative costs | 7,535 | 6,237 | 22,178 | 18,522 | ||||||||||||||||||||||
Corporate development costs | 250 | — | 250 | — | ||||||||||||||||||||||
Depreciation and amortization | 1,873 | 2,014 | 5,740 | 6,105 | ||||||||||||||||||||||
Total operating costs | 59,326 | 56,616 | 299,352 | 167,719 | ||||||||||||||||||||||
Income from operations | 7,114 | 4,939 | 28,588 | 13,194 | ||||||||||||||||||||||
Interest expense, net | 512 | 893 | 1,739 | 2,977 | ||||||||||||||||||||||
Income before income taxes | 6,602 | 4,046 | 26,849 | 10,217 | ||||||||||||||||||||||
Income tax expense | 1,738 | 1,166 | 7,003 | 2,956 | ||||||||||||||||||||||
Net income | $ | 4,864 | $ | 2,880 | $ | 19,846 | $ | 7,261 | ||||||||||||||||||
Net income per share - basic | $ | 0.38 | $ | 0.23 | $ | 1.55 | $ | 0.58 | ||||||||||||||||||
Net income per share - diluted | $ | 0.34 | $ | 0.21 | $ | 1.40 | $ | 0.54 | ||||||||||||||||||
Weighted average common stock outstanding | ||||||||||||||||||||||||||
Basic | 12,812 | 12,545 | 12,779 | 12,529 | ||||||||||||||||||||||
Diluted | 14,235 | 13,655 | 14,205 | 13,694 |
June 30, 2022 | September 30, 2021 | |||||||||||||
(unaudited) | ||||||||||||||
ASSETS | ||||||||||||||
Current assets: | ||||||||||||||
Cash | $ | 1,060 | $ | 24,051 | ||||||||||
Accounts receivable | 50,337 | 33,447 | ||||||||||||
Other current assets | 4,417 | 4,265 | ||||||||||||
Total current assets | 55,814 | 61,763 | ||||||||||||
Equipment and improvements, net | 1,355 | 1,912 | ||||||||||||
Operating lease right-of-use assets | 17,429 | 19,919 | ||||||||||||
Goodwill | 65,643 | 65,643 | ||||||||||||
Intangible assets, net | 42,530 | 47,469 | ||||||||||||
Other long-term assets | 365 | 464 | ||||||||||||
Total assets | $ | 183,136 | $ | 197,170 | ||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||
Current liabilities: | ||||||||||||||
Operating lease liabilities - current | $ | 2,227 | $ | 2,261 | ||||||||||
Accrued payroll | 13,157 | 9,125 | ||||||||||||
Deferred revenue | — | 22,273 | ||||||||||||
Accounts payable, accrued expenses, and other current liabilities | 35,098 | 32,717 | ||||||||||||
Total current liabilities | 50,482 | 66,376 | ||||||||||||
Long-term liabilities: | ||||||||||||||
Deferred taxes, net | 1,175 | 1,176 | ||||||||||||
Operating lease liabilities - long-term | 17,028 | 19,374 | ||||||||||||
Debt obligations - long-term, net of deferred financing costs | 26,783 | 44,636 | ||||||||||||
Total long-term liabilities | 44,986 | 65,186 | ||||||||||||
Total liabilities | 95,468 | 131,562 | ||||||||||||
Shareholders' equity: | ||||||||||||||
Common stock, $0.001 par value; authorized 40,000 shares; issued and outstanding 12,961 and 12,714 at June 30, 2022 and September 30, 2021, respectively | 13 | 13 | ||||||||||||
Additional paid-in capital | 90,107 | 87,893 | ||||||||||||
Accumulated deficit | (2,452) | (22,298) | ||||||||||||
Total shareholders’ equity | 87,668 | 65,608 | ||||||||||||
Total liabilities and shareholders' equity | $ | 183,136 | $ | 197,170 |
(unaudited) | ||||||||||||||
Nine Months Ended | ||||||||||||||
June 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
Operating activities | ||||||||||||||
Net income | $ | 19,846 | $ | 7,261 | ||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||
Depreciation and amortization | 5,740 | 6,105 | ||||||||||||
Amortization of deferred financing costs charged to interest expense | 497 | 610 | ||||||||||||
Stock-based compensation expense | 1,952 | 1,317 | ||||||||||||
Deferred taxes, net | (1) | 2,177 | ||||||||||||
Changes in operating assets and liabilities | ||||||||||||||
Accounts receivable | (16,890) | (3,868) | ||||||||||||
Other current assets | (152) | (133) | ||||||||||||
Accrued payroll | 4,032 | (403) | ||||||||||||
Deferred revenue | (22,273) | — | ||||||||||||
Accounts payable, accrued expenses, and other current liabilities | 2,380 | 1,912 | ||||||||||||
Other long-term assets and liabilities | 110 | 410 | ||||||||||||
Net cash provided by (used in) operating activities | (4,759) | 15,388 | ||||||||||||
Investing activities | ||||||||||||||
Business acquisition adjustment, net of cash acquired | — | 59 | ||||||||||||
Purchase of equipment and improvements | (244) | (53) | ||||||||||||
Net cash provided by (used in) investing activities | (244) | 6 | ||||||||||||
Financing activities | ||||||||||||||
Proceeds from debt obligations | 13,500 | 23,950 | ||||||||||||
Repayments of debt obligations | (31,750) | (40,150) | ||||||||||||
Payments of deferred financing costs | — | (43) | ||||||||||||
Proceeds from issuance of common stock upon exercise of options and warrants | 543 | 231 | ||||||||||||
Common stock surrendered for the exercise of stock options - tax obligations | (281) | — | ||||||||||||
Net cash used in financing activities | (17,988) | (16,012) | ||||||||||||
Net change in cash | (22,991) | (618) | ||||||||||||
Cash at beginning of period | 24,051 | 1,357 | ||||||||||||
Cash at end of period | $ | 1,060 | $ | 739 | ||||||||||
Supplemental disclosure of cash flow information | ||||||||||||||
Cash paid during the period for interest | $ | 1,195 | $ | 2,321 | ||||||||||
Cash paid during the period for income taxes | $ | 6,403 | $ | 396 | ||||||||||
Supplemental disclosure of non-cash activity | ||||||||||||||
Common stock surrendered for the exercise of stock options | $ | 256 | $ | — | ||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total Shareholders' Equity | |||||||||||||||||||||||||||||
(unaudited) | Shares | Amount | ||||||||||||||||||||||||||||||
Nine Months Ended June 30, 2022 | ||||||||||||||||||||||||||||||||
Balance at September 30, 2021 | 12,714 | $ | 13 | $ | 87,893 | $ | (22,298) | $ | 65,608 | |||||||||||||||||||||||
Expense related to director restricted stock units | — | — | 486 | — | 486 | |||||||||||||||||||||||||||
Expense related to employee stock-based compensation | — | — | 1,466 | — | 1,466 | |||||||||||||||||||||||||||
Exercise of stock options | 224 | — | 343 | — | 343 | |||||||||||||||||||||||||||
Common stock surrendered for the exercise of stock options | (31) | — | (281) | — | (281) | |||||||||||||||||||||||||||
Exercise of stock warrants | 54 | — | 200 | — | 200 | |||||||||||||||||||||||||||
Net income | — | — | — | 19,846 | 19,846 | |||||||||||||||||||||||||||
Balance at June 30, 2022 | 12,961 | $ | 13 | $ | 90,107 | $ | (2,452) | $ | 87,668 | |||||||||||||||||||||||
Three Months Ended June 30, 2022 | ||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | 12,794 | $ | 13 | $ | 89,664 | $ | (7,316) | $ | 82,361 | |||||||||||||||||||||||
Expense related to director restricted stock units | — | — | 162 | — | 162 | |||||||||||||||||||||||||||
Expense related to employee stock-based compensation | — | — | 481 | — | 481 | |||||||||||||||||||||||||||
Exercise of stock options | 198 | — | 81 | — | 81 | |||||||||||||||||||||||||||
Common stock surrendered for the exercise of stock options | (31) | — | (281) | — | (281) | |||||||||||||||||||||||||||
Net income | — | — | — | 4,864 | 4,864 | |||||||||||||||||||||||||||
Balance at June 30, 2022 | 12,961 | $ | 13 | $ | 90,107 | $ | (2,452) | $ | 87,668 |
Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total Shareholders' Equity | |||||||||||||||||||||||||||||
(unaudited) | Shares | Amount | ||||||||||||||||||||||||||||||
Nine Months Ended June 30, 2021 | ||||||||||||||||||||||||||||||||
Balance at September 30, 2020 | 12,404 | $ | 12 | $ | 85,868 | $ | (32,443) | $ | 53,437 | |||||||||||||||||||||||
Expense related to director restricted stock units | 78 | — | 349 | — | 349 | |||||||||||||||||||||||||||
Expense related to employee stock-based compensation | — | — | 968 | — | 968 | |||||||||||||||||||||||||||
Exercise of stock options | 63 | 1 | 230 | — | 231 | |||||||||||||||||||||||||||
Net income | — | — | — | 7,261 | 7,261 | |||||||||||||||||||||||||||
Balance at June 30, 2021 | 12,545 | $ | 13 | $ | 87,415 | $ | (25,182) | $ | 62,246 | |||||||||||||||||||||||
Three Months Ended June 30, 2021 | ||||||||||||||||||||||||||||||||
Balance at March 31, 2021 | 12,545 | $ | 13 | $ | 86,942 | $ | (28,062) | $ | 58,893 | |||||||||||||||||||||||
Expense related to director restricted stock units | — | — | 117 | — | 117 | |||||||||||||||||||||||||||
Expense related to employee stock-based compensation | — | — | 356 | — | 356 | |||||||||||||||||||||||||||
Net income | — | — | — | 2,880 | 2,880 | |||||||||||||||||||||||||||
Balance at June 30, 2021 | 12,545 | $ | 13 | $ | 87,415 | $ | (25,182) | $ | 62,246 |
Nine Months Ended | ||||||||||||||||||||
June 30, | ||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||
(in thousands) | Revenue | Percent of total revenue | Revenue | Percent of total revenue | ||||||||||||||||
Department of Homeland Security | $ | 126,397 | 38.6 | % | $ | 523 | 0.3 | % | ||||||||||||
Department of Veterans Affairs | 92,270 | 28.1 | % | 83,010 | 45.9 | % | ||||||||||||||
Department of Health and Human Services | 78,452 | 23.9 | % | 66,748 | 36.9 | % | ||||||||||||||
Department of Defense | 25,227 | 7.7 | % | 22,103 | 12.2 | % | ||||||||||||||
Other customers with less than 10% share of total revenue | 5,594 | 1.7 | % | 8,529 | 4.7 | % | ||||||||||||||
Total Revenue | $ | 327,940 | 100.0 | % | $ | 180,913 | 100.0 | % |
June 30, | September 30, | ||||||||||||||||
Ref | 2022 | 2021 | |||||||||||||||
Contract assets | $ | 8,467 | $ | 7,307 | |||||||||||||
Contract liabilities | (a) | $ | 200 | $ | 22,473 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
Ref | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Department of Homeland Security | (a) | $ | (4,908) | $ | 184 | $ | 126,397 | $ | 523 | |||||||||||||||||
Department of Veterans Affairs | 33,344 | 27,496 | 92,270 | 83,010 | ||||||||||||||||||||||
Department of Health and Human Services | 27,741 | 23,245 | 78,452 | 66,748 | ||||||||||||||||||||||
Department of Defense | 8,272 | 7,601 | 25,227 | 22,103 | ||||||||||||||||||||||
Other | 1,991 | 3,029 | 5,594 | 8,529 | ||||||||||||||||||||||
Total Revenue | $ | 66,440 | $ | 61,555 | $ | 327,940 | $ | 180,913 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Time and Materials | $ | 44,672 | $ | 46,790 | $ | 263,072 | $ | 137,492 | ||||||||||||||||||
Cost Reimbursable | 11,979 | 12,070 | 34,364 | 35,796 | ||||||||||||||||||||||
Firm Fixed Price | 9,789 | 2,695 | 30,504 | 7,625 | ||||||||||||||||||||||
Total Revenue | $ | 66,440 | $ | 61,555 | $ | 327,940 | $ | 180,913 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Prime Contractor | $ | 58,743 | $ | 53,407 | $ | 304,862 | $ | 159,059 | ||||||||||||||||||
Subcontractor | 7,697 | 8,148 | 23,078 | 21,854 | ||||||||||||||||||||||
Total Revenue | $ | 66,440 | $ | 61,555 | $ | 327,940 | $ | 180,913 |
June 30, | September 30, | ||||||||||
2022 | 2021 | ||||||||||
Operating lease right-of-use assets | $ | 17,429 | $ | 19,919 | |||||||
Operating lease liabilities, current | $ | 2,227 | $ | 2,261 | |||||||
Operating lease liabilities - long-term | 17,028 | 19,374 | |||||||||
Total operating lease liabilities | $ | 19,255 | $ | 21,635 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Operating | $ | 869 | $ | 903 | $ | 2,684 | $ | 2,763 | |||||||||||||||
Short-term | 33 | 18 | 85 | 88 | |||||||||||||||||||
Variable | 44 | 40 | 89 | 70 | |||||||||||||||||||
Sublease income | (69) | (46) | (188) | (233) | |||||||||||||||||||
Total lease costs | $ | 877 | $ | 915 | $ | 2,670 | $ | 2,688 |
For the Fiscal Year Ending September 30, | (in thousands) | ||||
2022 (remaining) | $ | 845 | |||
2023 | 3,299 | ||||
2024 | 3,156 | ||||
2025 | 2,995 | ||||
2026 | 3,092 | ||||
Thereafter | 11,000 | ||||
Total future lease payments | 24,387 | ||||
Less: imputed interest | (5,132) | ||||
Present value of future minimum lease payments | 19,255 | ||||
Less: current portion of operating lease liabilities | (2,227) | ||||
Long-term operating lease liabilities | $ | 17,028 |
Nine Months Ended | ||||||||||||||
June 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
Cash paid for amounts included in the measurement of lease liabilities | $ | 2,566 | $ | 2,483 | ||||||||||
(in thousands) | ||||||||||||||
June 30, | September 30, | |||||||||||||
2022 | 2021 | |||||||||||||
Billed receivables | $ | 41,870 | $ | 26,140 | ||||||||||
Contract assets | 8,467 | 7,307 | ||||||||||||
Total accounts receivable | $ | 50,337 | $ | 33,447 | ||||||||||
(in thousands) | ||||||||||||||
June 30, | September 30, | |||||||||||||
2022 | 2021 | |||||||||||||
Prepaid insurance and benefits | $ | 1,019 | $ | 655 | ||||||||||
Other receivables | 1,021 | 995 | ||||||||||||
Prepaid licenses and other expenses | 2,377 | 2,615 | ||||||||||||
Other current assets | $ | 4,417 | $ | 4,265 |
(in thousands) | |||||||||||||||||
June 30, | September 30, | ||||||||||||||||
Ref | 2022 | 2021 | |||||||||||||||
Furniture and equipment | $ | 958 | $ | 958 | |||||||||||||
Computer equipment | 1,484 | 1,262 | |||||||||||||||
Computer software | 4,375 | 4,353 | |||||||||||||||
Leasehold improvements | 1,595 | 1,595 | |||||||||||||||
Total equipment and improvements | 8,412 | 8,168 | |||||||||||||||
Less: accumulated depreciation and amortization | (a) | (7,057) | (6,256) | ||||||||||||||
Equipment and improvements, net | $ | 1,355 | $ | 1,912 |
(in thousands) | |||||||||||||||||
June 30, | September 30, | ||||||||||||||||
Ref | 2022 | 2021 | |||||||||||||||
Intangible assets | (a) | ||||||||||||||||
Customer contracts and related customer relationships | $ | 62,281 | $ | 62,281 | |||||||||||||
Covenants not to compete | 522 | 522 | |||||||||||||||
Trade name | 3,051 | 3,051 | |||||||||||||||
Total intangible assets | 65,854 | 65,854 | |||||||||||||||
Less: accumulated amortization | |||||||||||||||||
Customer contracts and related customer relationships | (22,049) | (17,378) | |||||||||||||||
Covenants not to compete | (303) | (264) | |||||||||||||||
Trade name | (972) | (743) | |||||||||||||||
Total accumulated amortization | (23,324) | (18,385) | |||||||||||||||
Intangible assets, net | $ | 42,530 | $ | 47,469 |
Estimated amortization expense for the following fiscal years ending September 30: | (in thousands) | ||||
2022 (remaining) | $ | 1,646 | |||
2023 | 6,585 | ||||
2024 | 6,585 | ||||
2025 | 6,585 | ||||
2026 | 5,851 | ||||
Thereafter | 15,278 | ||||
Total amortization expense | $ | 42,530 | |||
(in thousands) | |||||||||||
June 30, | September 30, | ||||||||||
2022 | 2021 | ||||||||||
Accounts payable | $ | 18,614 | $ | 16,684 | |||||||
Accrued benefits | 4,172 | 2,916 | |||||||||
Accrued bonus and incentive compensation | 2,600 | 2,381 | |||||||||
Accrued workers' compensation insurance | 4,877 | 7,014 | |||||||||
Other accrued expenses | 4,835 | 3,722 | |||||||||
Accounts payable, accrued expenses, and other current liabilities | $ | 35,098 | $ | 32,717 |
(in thousands) | |||||||||||||||||
June 30, | September 30, | ||||||||||||||||
Ref | 2022 | 2021 | |||||||||||||||
Bank term loan | $ | 28,500 | $ | 46,750 | |||||||||||||
Less: unamortized deferred financing costs | (1,717) | (2,114) | |||||||||||||||
Long-term portion of bank debt obligations, net of deferred financing costs | (a) | $ | 26,783 | $ | 44,636 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||||||||
(in thousands) | Ref | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||
Interest expense | (a) | $ | (334) | $ | (696) | $ | (1,242) | $ | (2,367) | ||||||||||||||||||||
Amortization of deferred financing costs | (b) | (178) | (197) | (497) | (610) | ||||||||||||||||||||||||
Interest expense, net | $ | (512) | $ | (893) | $ | (1,739) | $ | (2,977) |
($ in thousands) | ||||||||||||||||||||||||||
As of June 30, 2022 | ||||||||||||||||||||||||||
Lender | Arrangement | Loan Balance | Interest | Maturity Date | ||||||||||||||||||||||
First National Bank of Pennsylvania ("FNB") | Secured term loan (a) | $ | 28,500 | LIBOR* + 2.5% | 09/30/2025 | |||||||||||||||||||||
First National Bank of Pennsylvania ("FNB") | Secured revolving line of credit (b) | $ | — | LIBOR* + 2.5% | 09/30/2025 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
Ref | June 30, | June 30, | |||||||||||||||||||||||||||
(in thousands) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||
DLH employees | (a) | $ | 481 | $ | 356 | $ | 1,466 | $ | 968 | ||||||||||||||||||||
Non-employee directors | (b) | 162 | 117 | 486 | 349 | ||||||||||||||||||||||||
Total stock option expense | $ | 643 | $ | 473 | $ | 1,952 | $ | 1,317 |
June 30, | |||||||||||
Ref | 2022 | ||||||||||
Unrecognized expense for DLH employees | (a) | $ | 5,498 | ||||||||
Unrecognized expense for non-employee directors | 162 | ||||||||||
Total unrecognized expense | $ | 5,660 |
(in years) | ||||||||||||||||||||||||||
Weighted | ||||||||||||||||||||||||||
Weighted | Average | (in thousands) | ||||||||||||||||||||||||
(in thousands) | Average | Remaining | Aggregate | |||||||||||||||||||||||
Number of | Exercise | Contractual | Intrinsic | |||||||||||||||||||||||
Shares | Price | Term | Value | |||||||||||||||||||||||
Options outstanding, September 30, 2021 | 2,374 | $ | 5.60 | 5.60 | $ | 15,899 | ||||||||||||||||||||
Exercised | (224) | $ | 2.67 | — | — | |||||||||||||||||||||
Granted | 250 | $ | 16.01 | — | $ | — | ||||||||||||||||||||
Options outstanding, June 30, 2022 | 2,400 | $ | 6.96 | 5.68 | $ | 20,052 |
Number of Shares | |||||||||||||||||
June 30, | September 30, | ||||||||||||||||
Ref | 2022 | 2021 | |||||||||||||||
Vested and exercisable | (a) | 2,150 | 1,662 | ||||||||||||||
Unvested | (b) | 250 | 712 | ||||||||||||||
Options outstanding | 2,400 | 2,374 |
Payments Due Per Fiscal Year | |||||||||||||||||||||||
(Remaining) | |||||||||||||||||||||||
Total | 2022 | 2023 | 2024 | 2025 | 2026 | Thereafter | |||||||||||||||||
Debt obligations | $ | 28,500 | $ | — | $ | — | $ | — | $ | 28,500 | $ | — | $ | — | |||||||||
Facility operating leases | 24,231 | 824 | 3,216 | 3,104 | 2,995 | 3,092 | 11,000 | ||||||||||||||||
Equipment operating leases | 156 | 21 | 83 | 52 | — | — | — | ||||||||||||||||
Total contractual obligations | $ | 52,887 | $ | 845 | $ | 3,299 | $ | 3,156 | $ | 31,495 | $ | 3,092 | $ | 11,000 |
Nine Months Ended | ||||||||||||||||||||
June 30, | ||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||
(in thousands) | Revenue | Percent of total revenue | Revenue | Percent of total revenue | ||||||||||||||||
Human Services and Solutions | $ | 156,326 | 47.7 | % | $ | 26,711 | 14.8 | % | ||||||||||||
Defense and Veteran Health Solutions | 117,497 | 35.8 | % | 105,539 | 58.3 | % | ||||||||||||||
Public Health and Life Sciences | 54,117 | 16.5 | % | 48,663 | 26.9 | % | ||||||||||||||
Total Revenue | $ | 327,940 | 100.0 | % | $ | 180,913 | 100.0 | % |
Nine Months Ended | ||||||||||||||||||||
March 31, | ||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||
(in thousands) | Revenue | Percent of total revenue | Revenue | Percent of total revenue | ||||||||||||||||
Department of Homeland Security | $ | 126,397 | 38.6 | % | $ | 523 | 0.3 | % | ||||||||||||
Department of Veterans Affairs | 92,270 | 28.1 | % | 83,010 | 45.9 | % | ||||||||||||||
Department of Health and Human Services | 78,452 | 23.9 | % | 66,748 | 36.9 | % | ||||||||||||||
Department of Defense | 25,227 | 7.7 | % | 22,103 | 12.2 | % | ||||||||||||||
Other customers with less than 10% share of total revenue | 5,594 | 1.7 | % | 8,529 | 4.7 | % | ||||||||||||||
Total Revenue | $ | 327,940 | 100.0 | % | $ | 180,913 | 100.0 | % |
Three Months Ended | ||||||||||||||||||||||||||||||||
Consolidated Statements of Operations: | June 30, 2022 | June 30, 2021 | Change | |||||||||||||||||||||||||||||
Revenue | $ | 66,440 | 100.0 | % | $ | 61,555 | 100.0 | % | $ | 4,885 | ||||||||||||||||||||||
Cost of operations: | ||||||||||||||||||||||||||||||||
Contract costs | 49,668 | 74.9 | % | 48,365 | 78.6 | % | 1,303 | |||||||||||||||||||||||||
General and administrative costs | 7,535 | 11.3 | % | 6,237 | 10.1 | % | 1,298 | |||||||||||||||||||||||||
Corporate development costs | 250 | 0.3 | % | — | — | % | 250 | |||||||||||||||||||||||||
Depreciation and amortization | 1,873 | 2.8 | % | 2,014 | 3.3 | % | (141) | |||||||||||||||||||||||||
Total operating costs | 59,326 | 89.3 | % | 56,616 | 92.0 | % | 2,710 | |||||||||||||||||||||||||
Income from operations | 7,114 | 10.7 | % | 4,939 | 8.0 | % | 2,175 | |||||||||||||||||||||||||
Interest expense, net | 512 | 0.8 | % | 893 | 1.5 | % | (381) | |||||||||||||||||||||||||
Income before income taxes | 6,602 | 9.9 | % | 4,046 | 6.5 | % | 2,556 | |||||||||||||||||||||||||
Income tax expense | 1,738 | 2.6 | % | 1,166 | 1.9 | % | 572 | |||||||||||||||||||||||||
Net income | $ | 4,864 | 7.3 | % | $ | 2,880 | 4.6 | % | $ | 1,984 | ||||||||||||||||||||||
Net income per share - basic | $ | 0.38 | $ | 0.23 | $ | 0.15 | ||||||||||||||||||||||||||
Net income per share - diluted | $ | 0.34 | $ | 0.21 | $ | 0.13 |
Nine Months Ended | Change | |||||||||||||||||||||||||||||||
Consolidated Statements of Operations: | June 30, 2022 | June 30, 2021 | $ | |||||||||||||||||||||||||||||
Revenue | $ | 327,940 | 100.0 | % | $ | 180,913 | 100.0 | % | $ | 147,027 | ||||||||||||||||||||||
Cost of Operations: | ||||||||||||||||||||||||||||||||
Contract Costs | 271,184 | 82.7 | % | 143,092 | 79.1 | % | 128,092 | |||||||||||||||||||||||||
General and administrative expenses | 22,178 | 6.8 | % | 18,522 | 10.2 | % | 3,656 | |||||||||||||||||||||||||
Corporate development costs | 250 | 0.1 | % | — | — | % | 250 | |||||||||||||||||||||||||
Depreciation and amortization | 5,740 | 1.8 | % | 6,105 | 3.4 | % | (365) | |||||||||||||||||||||||||
Total operating costs | 299,352 | 91.3 | % | 167,719 | 92.7 | % | 131,633 | |||||||||||||||||||||||||
Income from operations | 28,588 | 8.7 | % | 13,194 | 7.3 | % | 15,394 | |||||||||||||||||||||||||
Interest | 1,739 | 0.5 | % | 2,977 | 1.6 | % | (1,238) | |||||||||||||||||||||||||
Income before income taxes | 26,849 | 8.2 | % | 10,217 | 5.6 | % | 16,632 | |||||||||||||||||||||||||
Income tax expense, net | 7,003 | 2.1 | % | 2,956 | 1.6 | % | 4,047 | |||||||||||||||||||||||||
Net income | $ | 19,846 | 6.1 | % | $ | 7,261 | 4.0 | % | $ | 12,585 | ||||||||||||||||||||||
Net income per share - basic | $ | 1.55 | $ | 0.58 | $ | 0.97 | ||||||||||||||||||||||||||
Net income per share - diluted | $ | 1.40 | $ | 0.54 | $ | 0.86 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||||||||||||||
(in thousands) | 2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||||||||||||||||||||||||||
Net income | $ | 4,864 | $ | 2,880 | $ | 1,984 | $ | 19,846 | $ | 7,261 | $ | 12,585 | ||||||||||||||||||||||||||
(i) Interest expense, net | 512 | 893 | (381) | 1,739 | 2,977 | (1,238) | ||||||||||||||||||||||||||||||||
(ii) Provision for taxes | 1,738 | 1,166 | 572 | 7,003 | 2,956 | 4,047 | ||||||||||||||||||||||||||||||||
(iii) Depreciation and amortization | 1,873 | 2,014 | (141) | 5,740 | 6,105 | (365) | ||||||||||||||||||||||||||||||||
EBITDA | $ | 8,987 | $ | 6,953 | $ | 2,034 | $ | 34,328 | $ | 19,299 | $ | 15,029 | ||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | Ref | 2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||||||||||||||||||||||||||||
Revenue | |||||||||||||||||||||||||||||||||||||||||
Total enterprise | $ | 66,440 | $ | 61,555 | $ | 4,885 | $ | 327,940 | $ | 180,913 | $ | 147,027 | |||||||||||||||||||||||||||||
Less: FEMA task orders to support Alaska | (a) | (5,116) | — | (5,116) | 125,773 | — | 125,773 | ||||||||||||||||||||||||||||||||||
Remaining contract portfolio | (a) | $ | 71,556 | $ | 61,555 | $ | 10,001 | $ | 202,167 | $ | 180,913 | $ | 21,254 | ||||||||||||||||||||||||||||
Operating income | |||||||||||||||||||||||||||||||||||||||||
Total enterprise | $ | 7,114 | $ | 4,939 | $ | 2,175 | $ | 28,588 | $ | 13,194 | $ | 15,394 | |||||||||||||||||||||||||||||
Less: FEMA task orders to support Alaska | (b) | 608 | — | 608 | 12,479 | — | 12,479 | ||||||||||||||||||||||||||||||||||
Remaining contract portfolio | (b) | $ | 6,506 | $ | 4,939 | $ | 1,567 | $ | 16,109 | $ | 13,194 | $ | 2,915 | ||||||||||||||||||||||||||||
Net income | |||||||||||||||||||||||||||||||||||||||||
Total enterprise | $ | 4,864 | $ | 2,880 | $ | 1,984 | $ | 19,846 | $ | 7,261 | $ | 12,585 | |||||||||||||||||||||||||||||
Less: FEMA task orders to support Alaska | (c) | 450 | — | 450 | 9,235 | — | 9,235 | ||||||||||||||||||||||||||||||||||
Remaining contract portfolio | (c) | $ | 4,414 | $ | 2,880 | $ | 1,534 | $ | 10,611 | $ | 7,261 | $ | 3,350 | ||||||||||||||||||||||||||||
Diluted earnings per share | |||||||||||||||||||||||||||||||||||||||||
Total enterprise | $ | 0.34 | $ | 0.21 | $ | 0.13 | $ | 1.40 | $ | 0.54 | $ | 0.86 | |||||||||||||||||||||||||||||
Less: FEMA task orders to support Alaska | (d) | 0.03 | — | 0.03 | 0.64 | — | 0.64 | ||||||||||||||||||||||||||||||||||
Remaining contract portfolio | (d) | $ | 0.31 | $ | 0.21 | $ | 0.10 | $ | 0.76 | $ | 0.54 | $ | 0.22 | ||||||||||||||||||||||||||||
EBITDA | |||||||||||||||||||||||||||||||||||||||||
Total enterprise | $ | 8,987 | $ | 6,953 | $ | 2,034 | $ | 34,328 | $ | 19,299 | $ | 15,029 | |||||||||||||||||||||||||||||
Less: FEMA task orders to support Alaska | (e) | 608 | — | 608 | 12,479 | — | 12,479 | ||||||||||||||||||||||||||||||||||
Remaining contract portfolio | (e) | $ | 8,379 | $ | 6,953 | $ | 1,426 | $ | 21,849 | $ | 19,299 | $ | 2,550 |
Nine Months Ended | ||||||||||||||
June 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
Net cash provided by (used in) operating activities | $ | (4,759) | $ | 15,388 | ||||||||||
Net cash provided by (used in) investing activities | (244) | 6 | ||||||||||||
Net cash used in financing activities | (17,988) | (16,012) | ||||||||||||
Net change in cash | $ | (22,991) | $ | (618) |
(in thousands) | ||||||||||||||||||||
Arrangement | Loan Balance | Interest* | Maturity Date | |||||||||||||||||
Secured term loan $70 million (a) | $ | 28,500 | LIBOR* + 2.5% | September 30, 2025 | ||||||||||||||||
Secured revolving line of credit $25 million ceiling (b) | $ | — | LIBOR* + 2.5% | September 30, 2025 |
Payments Due by Period | |||||||||||||||||||||||||||||
Next 12 | 2-3 | 4-5 | More than 5 | ||||||||||||||||||||||||||
(in thousands) | Total | Months | Years | Years | Years | ||||||||||||||||||||||||
Debt obligations | $ | 28,500 | $ | — | $ | — | $ | 28,500 | $ | — | |||||||||||||||||||
Facility operating leases | 24,231 | 3,241 | 6,137 | 5,767 | 9,086 | ||||||||||||||||||||||||
Equipment operating leases | 156 | 83 | 73 | — | — | ||||||||||||||||||||||||
Total Contractual Obligations | $ | 52,887 | $ | 3,324 | $ | 6,210 | $ | 34,267 | $ | 9,086 |
($ in thousands) | ||||||||||||||||||||||||||
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased As Part of Publicly Announced Programs | Dollar Value of Shares that May Yet Be Purchased Under the Plan or Program | ||||||||||||||||||||||
April 2022 | — | $ | — | — | $ | — | ||||||||||||||||||||
May 2022 | — | — | — | — | ||||||||||||||||||||||
June 2022 | 31,119 | $ | 17.25 | — | — | |||||||||||||||||||||
Total | 31,119 | $ | 17.25 | — | $ | — |
Exhibit | Incorporated by Reference | Filed | ||||||||||||||||||||||||||||||
Number | Exhibit Description | Form | Dated | Exhibit | Herewith | |||||||||||||||||||||||||||
X | ||||||||||||||||||||||||||||||||
X | ||||||||||||||||||||||||||||||||
X | ||||||||||||||||||||||||||||||||
X | ||||||||||||||||||||||||||||||||
101 | The following financial information from the DLH Holdings Corp. Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2022, formatted in iXBRL (Inline eXtensible Business Reporting Language) and filed electronically herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Operations; (iii) the Consolidated Statements of Cash Flows; and, (iv) the Notes to the Consolidated Financial Statements. | X | ||||||||||||||||||||||||||||||
104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) | |||||||||||||||||||||||||||||||
DLH HOLDINGS CORP. | |||||||||||
By: | /s/ Kathryn M. JohnBull | ||||||||||
Kathryn M. JohnBull | |||||||||||
Chief Financial Officer | |||||||||||
(On behalf of the registrant and as Principal Financial and Accounting Officer) | |||||||||||
Date: August 2, 2022 |
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www.dlhcorp.com |
Atlanta HQ 3565 Piedmont Road NE Tower 3, Suite 700 Atlanta, GA 30305 | National Capital Region HQ 8757 Georgia Ave Suite 1200 Silver Spring, MD 20910 |
![]() | ||
www.dlhcorp.com |
DLH Holdings Corp. | Agreed and accepted as of the date set forth above: | ||||||||||||||||
By: | /s/ Zachary C. Parker | By: | /s/ Kevin Wilson | ||||||||||||||
Name: | Zachary C. Parker | Kevin Wilson | |||||||||||||||
Title: | Chief Executive Officer and President |
Atlanta HQ 3565 Piedmont Road NE Tower 3, Suite 700 Atlanta, GA 30305 | National Capital Region HQ 8757 Georgia Ave Suite 1200 Silver Spring, MD 20910 |
/s/ Zachary C. Parker Zachary C. Parker Chief Executive Officer (Principal Executive Officer) |
/s/ Kathryn M. JohnBull Kathryn M. JohnBull Chief Financial Officer (Principal Accounting Officer) |
/s/ ZACHARY C. PARKER Zachary C. Parker Chief Executive Officer (Principal Executive Officer) | /s/ KATHRYN M. JOHNBULL Kathryn M. JohnBull Chief Financial Officer (Principal Accounting Officer) |