CACI International Q4 Earnings Call Highlights

CACI International NYSE: CACI reported record revenue, EBITDA margin and free cash flow for its fiscal 2026 fourth quarter and full year, while issuing fiscal 2027 guidance that calls for continued double-digit revenue growth and at least $900 million in free cash flow.

For fiscal 2026, the national security technology company generated $9.6 billion in revenue, up 10.9% from the prior year, including 7.2% organic growth. EBITDA margin rose 110 basis points to 12.3%, while adjusted diluted earnings per share increased 12.7% to $29.83. Free cash flow totaled $735 million, and the company said free cash flow per share rose 68%.

Fourth-quarter revenue was $2.7 billion, an increase of 17.6% year over year, including 11.6% organic growth. Quarterly EBITDA margin reached 13%, up 150 basis points from a year earlier. The company said a gain from a minor divestiture in its U.K. business added about 30 basis points to fourth-quarter margin. Adjusted diluted EPS was $8.91, up 6.1%, and quarterly free cash flow was $233 million.

CACI forecast fiscal 2027 revenue of $10.65 billion to $10.85 billion, representing growth of 11.3% to 13.4%, including about $500 million of acquired revenue. The company expects EBITDA margin in the high 12% range, adjusted diluted EPS of $32.96 to $33.86, and free cash flow of at least $900 million.

Chief Financial Officer Jeff MacLauchlan said the free-cash-flow outlook includes a delayed $40 million tax refund and a $115 million cash benefit related to changes in the Section 174 research-and-development tax credit. CACI expects free cash flow per share to grow about 22% in fiscal 2027 and expects adjusted net income conversion of at least 100% for a second consecutive year.

MacLauchlan said organic growth is expected to be stronger in the second half of fiscal 2027 than in the first half, with first-quarter organic growth anticipated to be in the low single digits. He also described the company’s historical revenue cadence as approximately 45% in the first half and 55% in the second half, while cash flow has tended to be more heavily weighted toward the second half.

President and Chief Executive Officer John Mengucci said the company’s growth strategy centers on software-defined technologies for national security missions, supported by its operational workforce and investments made ahead of customer demand. In electronic warfare, Mengucci said CACI’s Spectral program reached Milestone C and is moving into low-rate initial production, with deployment expected to begin in the second half of fiscal 2027. The company’s SkyValor counter-unmanned aircraft system was selected for southern-border homeland-defense work, and CACI recently received a separate $500 million Domestic Shield award.

Mengucci said the company sees growing demand for counter-UAS systems and described the market as a long-term growth opportunity. He said CACI has received export...