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Excrept from filing document 2024-06-30

The aggregate market value of common shares held by non affiliates of the Registrant on December 31 2023 was 7 137 375 979 based upon the closing price of the Registrant s common shares as quoted on the New York Stock Exchange composite tape on such date
Part III of this Form 10 K incorporates by reference certain information from the Registrant s Proxy Statement to be filed with the Securities Exchange Commission SEC pursuant to Regulation 14A for the 2024 Annual Meeting of Stockholders
Certain information included or incorporated by reference in this Annual Report on Form 10 K may not address historical facts and therefore could be interpreted to be forward looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 and other federal securities laws All statements other than statements of historical fact are statements that could be deemed forward looking statements including projections of financial performance statements of plans strategies and objectives of management for future operations any statement concerning developments performance or industry rankings relating to products or services any statements regarding future economic conditions or performance any statements of assumptions underlying any of the foregoing and any other statements that address activities events or developments that the Company intends expects projects believes or anticipates will or may occur in the future Forward looking statements may be characterized by terminology such as believe anticipate expect should intend plan will estimates projects strategy and similar expressions These statements are based on assumptions and assessments made by the Company s management in light of its experience and its perception of historical trends current conditions expected future developments and other factors it believes to be appropriate These forward looking statements are subject to a number of risks and uncertainties that include but are not limited to the factors set forth under Item 1A Risk Factors in this Annual Report on Form 10 K
Any such forward looking statements are not guarantees of future performance and actual results developments and business decisions may differ materially from those envisaged by such forward looking statements The forward looking statements included herein speak only as of the date of this Annual Report on Form 10 K The Company disclaims any duty to update such forward looking statements all of which are expressly qualified by the foregoing
CACI International Inc CACI a Delaware corporation is a holding company whose operations are conducted through subsidiaries primarily located in the United States and Europe CACI was founded in 1962 as a simulation technology company and has grown into a leading provider of distinctive Expertise and differentiated Technology to customers in support of national security in the intelligence defense and federal civilian sectors both domestically and internationally Unless the context indicates otherwise the terms we our the Company and CACI refer to CACI International Inc and its subsidiaries and ventures that are majority owned or otherwise controlled by it The term the Registrant refers to CACI International Inc only
CACI delivers talent with the specific technical and functional knowledge to support internal agency operations Examples include functional software development expertise data and business analysis IT operations support naval architecture engineering and life cycle support intelligence and special operations support and network and exploitation analysis
CACI provides technology that addresses our customer s most challenging needs This includes agile software development using open modern architectures and DevSecOps advanced data platforms and applications augmented by Artificial Intelligence AI Enterprise Resource Planning ERP systems Electromagnetic Spectrum EMS capabilities photonics and network modernization CACI invests ahead of customer need with research and development to generate unique intellectual property and differentiated technology addressing critical national security needs
Our proven Expertise and Technology and strong record of program delivery have enabled us to compete for and secure new customers and contracts win repeat business and build and maintain long term customer relationships We seek competitive business opportunities and have built our operations to support major programs through a market focused business development organization
Our customers are primarily agencies and departments of the U S government as well as foreign governments and commercial enterprises The demand for our Expertise and Technology in large measure is created by the increasingly complex network systems and information environments in which governments and businesses operate and by the need to stay current with emerging technology while increasing productivity enhancing security and ultimately improving performance
For additional discussion and analysis on recent business developments see Management s Discussion and Analysis of Financial Condition Results of Operations in Part II of this Annual Report on Form 10 K
CACI transforms how government does business Using our Agile at scale method and business process automation tools we modernize enterprise and agency unique applications enterprise infrastructure and business processes to enhance productivity and increase user satisfaction We use data analytics and visualization to provide insights and outcomes that optimize our customer s operations
CACI teams ensure information superiority by delivering multi domain command control communications and computer C4 intelligence surveillance and reconnaissance ISR technology and networks Our software defined signals intelligence electronic warfare and counter unmanned aircraft system C UAS solutions provide electromagnetic spectrum advantage and deliver precision effects against national security threats We are at the forefront of developing technologies that meet the challenges of 5G and mmWave wireless communications both on and off the battlefield
CACI s full spectrum cyber capabilities help customers prepare defend and sustain their enterprise and mission against cyber threats Through our research and development R D efforts we develop and deploy new technologies for cybersecurity and cyberspace operations including addressing technical challenges in an era of converging cyber electronic warfare EW and signals intelligence SIGINT operations Our industry leading cybersecurity lifecycle approach ensures the confidentiality integrity and availability of networks systems and data
CACI s space domain awareness and decision support capabilities enable multi domain operations We are an industry leader in intelligence fusion data analytics and decision support as well as integrated logistics that keep vital space capabilities running We are at the forefront of developing technologies that use lasers for free space optical communications and long range sensing
CACI provides platform integration and modernization and sustainment system engineering naval architecture training and simulation services and logistics engineering to help our customer achieve a decisive tactical edge We enhance platforms to improve situational awareness mobility interoperability lethality and survivability We conduct software vulnerability analysis and harden technology to protect against malicious actors Our platform agnostic mission first approach ensures optimal performance so our nation s forces can overmatch our adversaries
CACI amplifies efficiency with unmatched expertise and next generation technology We pioneered secure enterprise cloud solutions for classified and unclassified networks We design implement protect and manage secure enterprise IT solutions for approximately 50 federal agencies to optimize efficiency enhance performance and ensure end user satisfaction
CACI s intelligence support ensures continuous advances in collection analysis and dissemination to optimize decision making We provide analytic services in approximately 50 languages as well as scenario based instruction across the spectrum of intelligence processing collection and products Our investigation and litigation experts support the U S government on thousands of cases saving taxpayers billions of dollars And CACI facilitates the secure flow of supplies across the globe
Our international operations are conducted primarily through our operating subsidiaries in Europe CACI Limited and CACI BV and account for substantially all revenues generated from international customers Headquartered in London our international operations provide a diverse mix of IT services and proprietary data and software products serving commercial and government customers throughout the United Kingdom U K continental Europe and around the world
We operate in a highly competitive industry that includes many firms some of which are larger in size and have greater financial resources than we do We obtain much of our business on the basis of proposals submitted in response to requests from potential and current customers who may also receive proposals from other firms Non traditional players have entered the market and have established positions related to such areas as cloud computing cyber satellite operations and business systems Additionally we face indirect competition from certain government agencies that perform services for themselves similar to those marketed by us We know of no single competitor that is dominant in our fields of technology We have a relatively small share of the addressable market for our Expertise and Technology and intend to achieve growth and increase market share both organically and through strategic acquisitions
We primarily offer our entire range of Expertise and Technology to defense intelligence and civilian agencies of the U S government Our work for U S government agencies may combine a wide range of skills drawn from our Expertise and Technology We also contract through our international operations to provide our offerings to governments of other nations As with other government contractors our business is subject to government customer funding decisions and actions that are beyond our control
Our international commercial customer base consists primarily of large commercial and government enterprises in the U K This market is the primary target of a diverse mix of IT consultancy services and proprietary data and software products Commercial bids are frequently negotiated as to terms and conditions for schedule specifications delivery and payment
In order to effectively perform on our existing customer contracts and secure new customer contracts within the U S government we must maintain expert knowledge of agency policies operations and challenges We combine this comprehensive knowledge with Expertise and Technology for our customers Our capabilities provide us with opportunities either to compete directly for or to support other bidders in competition for multi million dollar and multi year award contracts from the U S government
We have strategic business relationships with a number of companies associated with the information technology industry These strategic partners have business objectives compatible with ours and offer Expertise and Technology that complement ours We intend to continue development of these kinds of relationships wherever they support our growth objectives
Our marketing and new business development is conducted by many of our officers and managers including the Chief Executive Officer executive officers vice presidents and division managers We employ marketing professionals who identify and qualify major contract opportunities primarily in the federal government market
Much of our business is won through submission of formal competitive bids Government and commercial customers typically base their decisions regarding contract awards on their assessment of the quality of past performance responsiveness to proposal requirements price and other factors The terms conditions and form of contract of government bids however are in most cases specified by the customer In situations in which the customer imposed contract type and or terms appear to expose us to inappropriate risk or do not offer us a sufficient financial return we may seek alternate arrangements or opt not to bid for the work Essentially all contracts with the U S government and many contracts with other government entities permit the government customer to terminate the contract at any time for the convenience of the government or for default by the contractor Although we operate under the risk that such terminations may occur and have a material impact on operations such terminations have been rare and generally have not materially affected operations
Our contracts and subcontracts are composed of a wide range of contract types including fixed price cost reimbursement time and materials indefinite delivery indefinite quantity IDIQ and government wide acquisition contracts known as GWACS such as General Services Administration GSA schedule contracts By company policy significant fixed price contracts require the approval of at least two of our senior officers
During fiscal 2022 CACI completed four acquisitions that provide technology to sensitive government customers Their capabilities include open source intelligence solutions specialized cyber satellite communications multi domain photonics technologies for free space optical FSO communications and commercial solutions for classified CSfC security technologies
Our business in general is not seasonal although the summer and holiday seasons affect our revenues because of the impact of holidays and vacations on our labor Variations in our business also may occur at the expiration of major contracts until such contracts are renewed or new business is obtained
The U S government s fiscal year ends on September 30 of each year It is not uncommon for government agencies to award extra tasks or complete other contract actions in the weeks before the end of a fiscal year in order to avoid the loss of unexpended funds Moreover in years when the U S government does not complete the budget process for the next fiscal year before the end of September government operations whose appropriations legislation has not been signed into law are funded under a continuing resolution that authorizes them to continue to operate but traditionally does not authorize new spending initiatives
Our employees are our most valuable resource We are in continuing competition for highly skilled professionals in virtually all of our market areas The success and growth of our business is significantly correlated with our ability to recruit train promote and retain high quality people at all levels of the organization As of June 30 2024 we employed approximately 24 000
Our culture defines who we are how we act and what we believe is the right way to conduct business and is the driving force behind our success Our culture unifies us as a company and strengthens our resolve to meet our customers and our country s most critical missions
We believe that there are two pillars to our culture Character and Innovation Character is demonstrated in our commitment to ethics and integrity as we expect all of our employees and independent contractors to comply with our high standards for the conduct of our business that are reflected in our policies and practices We require all of our employees independent contractors working on customer engagements officers and directors annually to execute and affirm to the code of ethics applicable to their activities In addition we require annual ethics and compliance training for all of our employees to provide them with the knowledge necessary to maintain our high standards of ethics and compliance
Innovation is demonstrated in our dedication to advancement and excellence Our Center for Research Application Development Learning and Engagement CRADLE is a state of the art collaboration facility that provides customers with an enhanced engagement experience built to foster innovation creative designs and unique solutions The CRADLE brings together customers industry partners academia and CACI personnel to explore and discover new ways to solve complex problems and challenges
We embrace diversity equity and inclusion as core values and seek to ensure that all our employees experience a highly inclusive working environment Diversity equity and inclusion are woven into the fabric of CACI s culture where people bring their genuine selves to work feel inspired about CACI s mission and are passionate about making a difference for our people customers and the community Equity is defined as opportunities for development growth and advancement for all of our employees
Offering opportunities for employees to engage in allyship advocating for individuals from marginalized groups with the goal of advancing inclusion highlight successes champion initiatives discuss concerns and much more is core to CACI s commitment to a diverse equitable and inclusive work environment We created Employee Resource Groups ERGs to provide a safe space for group member engagement while offering mentorship networking professional development and leadership opportunities
We also focus on creating an environment where our people feel passionate and inspired about their careers and embrace and celebrate differences We achieve this by raising cultural awareness across the organization through our Path to Inclusion movement In our efforts to build inclusive teams our Path to Inclusion campaign cultivates cultural intelligence CQ across CACI CQ is an essential skill that consists of being aware of our own cultural identity understanding the cultural identities of others and bridging the gap to embrace and appreciate the differences This enables us to work collaboratively across teams and the organization in ways that ensure everyone is valued
Our industry is ever evolving and those who are most successful evolve with it continually learning and growing throughout their careers To ensure we have the talent to meet the needs of our customers we employ broad recruiting and outreach efforts including partnerships with universities the military and professional organizations resulting in an inclusive pool of the most qualified candidates
We are able to retain our employees through our career mobility corporate culture where we believe in growth at all levels We encourage all employees to embrace a career growth mindset at CACI and strive to provide our employees with long term professional advancement and a great workplace experience through professional development and a culture of mobility because our people drive our company
CACI has conducted employee engagement surveys and we rank above external benchmark companies in the areas of sustainable engagement inclusion teamwork supervision and empowerment Specifically our employees report that they have a personal sense of accomplishment in their work they feel safe to speak up and they have pride in CACI These indicators of an exceptionally strong culture and work environment puts CACI in an extremely competitive position to attract and retain talent and reach our organizational growth objectives We continue to invest in the areas that produce such high engagement leadership education career resources for employees comprehensive onboarding for new employees and formal and informal communications that create a two way dialogue among employees and leaders
We have a multilevel approach to developing our leaders with cohort style programs for first line mid level and executive leaders These programs focus on leadership capabilities unique to each level of leadership and serve to increase self awareness strengthen skills and expand networking for our leaders Furthermore we have a robust talent planning approach to identify potential future leaders conduct rigorous assessments and create actionable development plans to advance their readiness to take on our most senior roles as they evolve in our future
We value the social physical financial and emotional well being of our employees We believe in curating environments and providing resources that support the CACI community s well being We cultivate a culture that prioritizes wellness and encourages a healthy balanced and thriving lifestyle It is our desire to provide our employees innovative and accessible resources that support them on their well being journey to become their best selves Our mission is to educate support and empower employees through the delivery of a comprehensive well being program Our well being program includes Flexible Time Off FTO which allows employees to better balance their work and personal commitments by providing them the opportunity to take time off as needed without a set number of maximum days per year In addition CACI supports the financial wellness of our employees by providing unlimited access to fiduciary advice at no cost to the employee as well as a full suite of tools and educational opportunities to enable our employees to meet their financial goals
Generally our solutions and services are not substantially dependent upon obtaining or maintaining intellectual property protections although our operations make use of such protections and benefit from them as discriminators in competition The Company owns patents and claims copyright trademark and other proprietary rights in a variety of intellectual property We also maintain a number of trade secrets that contribute to our success and competitive distinction and endeavor to accord such trade secrets protection adequate to ensure their continuing availability to us
Our proprietary information is protected through a combination of contractual arrangements with our employees and third parties and intellectual property laws From time to time we are required to assert our rights against former employees or other third parties who attempt to misappropriate our proprietary and confidential information Although we are not materially dependent on the protection of our intellectual property we take such matters seriously and pursue claims against such individuals to the extent necessary to adequately protect our rights
As a systems integrator it is important that we maintain access to software data and technology supplied by third parties and we continue to enter into agreements that give us the right to distribute and receive income from third party software data and technology that serve our customers The durations of such agreements are negotiated and vary according to the terms of the agreements
The Company reports operating results and financial data in two segments Domestic Operations and International Operations See Note 18 Business Segments in Part II of this Annual Report on Form 10 K for additional information
Our telephone number is 703 841 7800 and our website can be accessed at www caci com We make our web site content available for information purposes only It should not be relied upon for investment purposes nor is it incorporated by reference into this Annual Report on Form 10 K
Our Annual Reports on Form 10 K Quarterly Reports on Form 10 Q Current Reports on Form 8 K and amendments to those reports filed or furnished pursuant to Section 13 a or 15 d of the Exchange Act are made available free of charge on our website at www caci com as soon as reasonably practicable after we electronically file such material with or furnish it to the SEC Documents filed by us with the SEC can also be viewed at www sec gov
You should carefully consider the risks and uncertainties described below together with the information included elsewhere in this Annual Report on Form 10 K and other documents we file with the SEC The risks and uncertainties described below are those that we have identified as material but are not the only risks and uncertainties that we face Our business is also subject to general risks and uncertainties such as overall U S and non U S economic and industry conditions including a global economic slowdown geopolitical events changes in laws or accounting rules fluctuations in interest and exchange rates terrorism international conflicts major health concerns including global pandemics like COVID 19 natural disasters or other disruptions of expected economic and business conditions that affect many other companies Additional risks and uncertainties not currently known to us or that we currently believe are immaterial also may impact our business operations and liquidity
We generate substantially all of our revenues from contracts with the federal government If the federal government significantly decreased or ceased doing business with us our business prospects financial condition and operating results would be materially and adversely affected
The federal government is our primary customer with revenues from federal government contracts either as a prime contractor or a subcontractor accounting for 95 1 and 94 8 of our total revenues in fiscal 2024 and 2023 respectively Specifically we generated 74 4 and 71 9 of our total revenues in fiscal 2024 and 2023 respectively from contracts with agencies of the DoD We expect that federal government contracts will continue to be the primary source of our revenues for the foreseeable future If we were suspended or debarred from contracting with the federal government or any significant agency in the intelligence community or the DoD if our reputation or relationship with government agencies was impaired or if the government otherwise ceased doing business with us or significantly decreased the amount of business it does with us our business prospects financial condition and operating results would be materially and adversely affected
The number of bid protests of contract awards by unsuccessful bidders is increasing and the U S government is taking longer to resolve such protests Bid protests may result in an increase in expenses related to obtaining contract awards or an unfavorable modification or loss of an award In the event a bid protest is unsuccessful the resulting delay in the startup and funding of the work under these contracts may cause our actual results to differ materially and adversely from those anticipated
Because we derive substantially all of our revenues from contracts with the federal government we believe that the success and development of our business will continue to depend on our successful participation in federal government contract programs Changes in federal government budgetary priorities such as for homeland security or to address global pandemics like COVID 19 or actions taken to address government budget deficits the national debt and or prevailing economic conditions could directly affect our financial performance A significant decline in government expenditures a shift of expenditures away from programs that we support or a change in federal government contracting policies could cause federal government agencies to reduce their purchases under contracts to exercise their right to terminate contracts at any time without penalty or not to exercise options to renew contracts For further discussion refer to Management s Discussion and Analysis of Financial Condition Results of Operations in Part II of this Annual Report on Form 10 K
At times we may continue to work without funding and use our own internal funds in order to meet our customer s desired delivery dates for Expertise or Technology It is uncertain at this time which of our programs funding could be reduced in future years or whether new legislation will be passed by Congress in the next fiscal year that could result in additional or alternative funding cuts
Our federal government contracts may be terminated by the government at any time and may contain other provisions permitting the government not to continue with contract performance and if lost contracts are not replaced our operating results may differ materially and adversely from those anticipated
We generate substantially all of our revenues from federal government contracts that typically include a base period and discrete option periods The option periods typically cover more than half of the contract s potential duration Federal government agencies generally have the right not to exercise these option periods In addition our contracts typically also contain provisions permitting a government customer to terminate the contract for its convenience A decision not to exercise option periods or to terminate contracts for convenience could result in significant revenue shortfalls from those anticipated
Federal government contracts contain provisions and are subject to laws and regulations that give the government rights and remedies some of which are not typically found in commercial contracts including allowing the government to
If the government terminates a contract for convenience we may recover only our incurred or committed costs settlement expenses and profit on work completed prior to the termination If the government terminates a contract for default we may be unable to recover even those amounts and instead may be liable for excess costs incurred by the government in procuring undelivered items and services from another source Depending on the value of a contract such termination could cause our actual results to differ materially and adversely from those anticipated Certain contracts also contain organizational conflict of interest OCI clauses that limit our ability to compete for or perform certain other contracts OCIs arise any time we engage in activities that i make us unable or potentially unable to render impartial assistance or advice to the government ii impair or might impair our objectivity in performing contract work or iii provide us with an unfair competitive advantage For example when we work on the design of a particular system we may be precluded from competing for the contract to develop and install that system Depending upon the value of the matters affected an OCI issue that precludes our participation in or performance of a program or contract could cause our actual results to differ materially and adversely from those anticipated
As is common with government contractors we have experienced and continue to experience occasional performance issues under certain of our contracts Depending upon the value of the matters affected a performance problem that impacts our performance of a program or contract could cause our actual results to differ materially and adversely from those anticipated
To facilitate our ability to prepare bids for new business we rely in part on establishing and maintaining relationships with officials of various government entities and agencies These relationships enable us to provide informal input and advice to government entities and agencies prior to the development of a formal bid We may be unable to successfully maintain our relationships with government entities and agencies and any failure to do so may adversely affect our ability to bid successfully for new business and could cause our actual results to differ materially and adversely from those anticipated
We derive significant revenues from contracts and task orders awarded through a competitive bidding process If we are unable to consistently win new awards over any extended period our business and prospects will be adversely affected
Our contracts and task orders with the federal government are typically awarded through a competitive bidding process We expect that much of the business that we will seek in the foreseeable future will continue to be awarded through competitive bidding Budgetary pressures and changes in the procurement process have caused many government customers to increasingly purchase goods and services through IDIQ contracts GSA schedule contracts and other government wide acquisition contracts These contracts some of which are awarded to multiple contractors have increased competition and pricing pressure requiring that we make sustained post award efforts to realize revenues under each such contract In addition in consideration of the practice of agencies awarding work under such contracts that is arguably outside the intended scope of the contracts both the GSA and the DoD have initiated programs aimed to ensure that all work fits properly within the scope of the contract under which it is awarded The net effect of such programs may reduce the number of bidding opportunities available to us Moreover even if we are highly qualified to work on a particular new contract we might not be awarded business because of the federal government s policy and practice of maintaining a diverse contracting base
we may encounter expense and delay if our competitors protest or challenge awards of contracts to us in competitive bidding and any such protest or challenge could result in the resubmission of bids on modified specifications or in the termination reduction or modification of the awarded contract
If we are unable to win particular multi year contracts we may be prevented from providing to customers services that are purchased under those contracts for a number of years If we are unable to consistently win new contract awards over any extended period our business and prospects will be adversely affected and that could cause our actual results to differ materially and adversely from those anticipated In addition upon the expiration of a contract if the customer requires further services of the type provided by the contract there is frequently a competitive rebidding process There can be no assurance that we will win any particular bid or that we will be able to replace business lost upon expiration or completion of a contract and the termination or non renewal of any of our significant contracts could cause our actual results to differ materially and adversely from those anticipated
Many of our federal government contracts require us to have security clearances and employ personnel with specified levels of education work experience and security clearances Depending on the level of clearance security clearances can be difficult and time consuming to obtain If we or our employees lose or are unable to obtain necessary security clearances we may not be able to win new business and our existing customers could terminate their contracts with us or decide not to renew them To the extent we cannot obtain or maintain the required security clearances for our employees working on a particular contract we may not generate the revenues anticipated from the contract which could cause our results to differ materially and adversely from those anticipated
If our subcontractors fail to perform their contractual obligations our performance as a prime contractor and our ability to obtain future business could be materially and adversely impacted and our actual results could differ materially and adversely from those anticipated
Our performance of government contracts may involve the issuance of subcontracts to other companies upon which we rely to perform all or a portion of the work we are obligated to deliver to our customers A failure by one or more of our subcontractors to satisfactorily deliver on a timely basis the agreed upon supplies perform the agreed upon services or appropriately manage their vendors may materially and adversely impact our ability to perform our obligations as a prime contractor
A subcontractor s performance deficiency could result in the government terminating our contract for default A default termination could expose us to liability for excess costs of reprocurement by the government and have a material adverse effect on our ability to compete for future contracts and task orders Depending upon the level of problem experienced such problems with subcontractors could cause our actual results to differ materially and adversely from those anticipated
The federal government s appropriation process and other factors may delay the collection of our receivables and our business may be adversely affected if we cannot collect our receivables in a timely manner
We depend on the collection of our receivables to generate cash flow provide working capital pay debt and continue our business operations If the federal government any of our other customers or any prime contractor for whom we are a subcontractor fails to pay or delays the payment of their outstanding invoices for any reason our business and financial condition may be materially and adversely affected The government may fail to pay outstanding invoices for a number of reasons including lack of appropriated funds or lack of an approved budget In addition the Defense Contract Audit Agency DCAA may revoke our direct billing privileges which would adversely affect our ability to collect our receivables in a timely manner Contracting officers have the authority to impose contractual withholdings which can also adversely affect our ability to collect timely The Defense Federal Acquisition Regulations require DoD contracting officers to impose contractual withholdings at no less than certain minimum levels if a contracting officer determines that one or more of a contractor s business systems have one or more significant deficiencies Some prime contractors for whom we are a subcontractor have significantly less financial resources than we do which may increase the risk that we may not be paid in full or payment may be delayed If we experience difficulties collecting receivables it could cause our actual results to differ materially and adversely from those anticipated
The federal government may change its procurement practices or adopt new contracting rules and regulations such as those related to cost accounting standards It could also adopt new contracting methods relating to GSA contracts or other government wide contracts adopt new socio economic requirements or change the basis upon which it reimburses our compensation and other expenses or otherwise limit such reimbursements In all such cases there is uncertainty surrounding the changes and what actual impacts they may have on contractors These changes could impair our ability to obtain new contracts or win re competed contracts or adversely affect our future profit margin Any new contracting methods could be costly or administratively difficult for us to satisfy and as a result could cause actual results to differ materially and adversely from those anticipated
We derive a significant amount of revenues from service contracts with the federal government The government may face restrictions from new legislation regulations or government union pressures on the nature and amount of services the government may obtain from private contractors i e insourcing versus outsourcing Any reduction in the government s use of private contractors to provide federal services could cause our actual results to differ materially and adversely from those anticipated
Our contracts and administrative processes and systems are subject to audits and cost adjustments by the federal government which could reduce our revenues disrupt our business or otherwise adversely affect our operating results
Federal government agencies including the DCAA and the Defense Contract Management Agency DCMA routinely audit and investigate government contracts and government contractors administrative processes and systems These agencies review our performance on contracts pricing practices cost structure and compliance with applicable laws regulations and standards They also evaluate the adequacy of internal controls over our business systems including our purchasing accounting estimating earned value management and government property systems Any costs found to be improperly allocated or assigned to contracts will not be reimbursed and any such costs already reimbursed must be refunded and certain penalties may be imposed Moreover if any of the administrative processes and systems are found not to comply with requirements we may be subjected to increased government scrutiny and approval that could delay or otherwise adversely affect our ability to compete for or perform contracts or collect our revenues in a timely manner Therefore an unfavorable outcome of an audit by the DCAA or another government agency could cause actual results to differ materially and adversely from those anticipated If a government investigation uncovers improper or illegal activities we may be subject to civil and criminal penalties and administrative sanctions including termination of contracts forfeitures of profits suspension of payments fines and suspension or debarment from doing business with the federal government In addition we could suffer serious reputational harm if allegations of impropriety were made against us Each of these results could cause actual results to differ materially and adversely from those anticipated
We derive substantial revenues from contracts in which we act as a subcontractor or from teaming arrangements in which we and other contractors bid on particular contracts or programs As a subcontractor or teammate we often lack control over fulfillment of a contract and poor performance on the contract could impact our customer relationship even when we perform as required We expect to continue to depend on relationships with other contractors for a portion of our revenues in the foreseeable future Moreover our revenues and operating results could differ materially and adversely from those anticipated if any prime contractor or teammate chose to offer directly to the customer services of the type that we provide or if they team with other companies to provide those services
Our total backlog consists of funded and unfunded amounts Funded backlog represents contract value for which funding has been appropriated less revenues previously recognized on these contracts Unfunded backlog represents estimated values that have the potential to be recognized into revenue from executed contracts for which funding has not been appropriated and unexercised contract options Our backlog may not result in actual revenues in any particular period or at all which could cause our actual results to differ materially and adversely from those anticipated
The maximum contract value specified under a government contract or task order awarded to us is not necessarily indicative of the revenues that we will realize under that contract For example we generate a substantial portion of our revenues from government contracts in which we are not the sole provider meaning that the government could turn to other companies to fulfill the contract We also generate revenues from IDIQ contracts which do not require the government to purchase a pre determined amount of goods or services under the contract Action by the government to obtain support from other contractors or failure of the government to order the quantity of work anticipated could cause our actual results to differ materially and adversely from those anticipated
Many of our federal government contracts include multi year performance periods in which Congress appropriates funds on an annual basis As a result a majority of our contracts are only partially funded at any point during their full performance period and unfunded contract work is subject to future appropriations by Congress As a result of a lack of appropriated funds or efforts to reduce federal government spending our backlog may not result in revenues or may be delayed We calculate our unfunded backlog based on the aggregate contract revenues that we have the potential to realize If our backlog estimate is inaccurate and we fail to realize those amounts as revenues our future operating results could be materially and adversely affected
We may be unable to prevent our employees from engaging in misconduct fraud or other improper activities that could adversely affect our business and reputation Misconduct could include the failure to comply with federal government procurement regulations regulations regarding the protection of classified information and legislation regarding the pricing of labor and other costs in government contracts Many of the systems we develop involve managing and protecting information involved in national security and other sensitive government functions A security breach in one of these systems could prevent us from having access to such critically sensitive systems Other examples of employee misconduct could include timecard fraud and violations of the Anti Kickback Act The precautions we take to prevent and detect this activity may not be effective and we could face unknown risks or losses As a result of employee misconduct we could face fines and penalties loss of security clearance and suspension or debarment from contracting with the federal government which could cause our actual results to differ materially and adversely from those anticipated
Our continued success depends to a substantial degree on our ability to recruit and retain the technically skilled personnel we need to serve our customers effectively Our business involves the development of tailored solutions for our customers a process that relies heavily upon the expertise and services of our employees Accordingly our employees are our most valuable resource Competition for skilled personnel in the information technology services industry is intense and technology service companies often experience high attrition among their skilled employees There is a shortage of people capable of filling these positions and they are likely to remain a limited resource for the foreseeable future Recruiting and training these personnel require substantial resources Our failure to attract and retain technical personnel could increase our costs of performing our contractual obligations reduce our ability to efficiently satisfy our customers needs limit our ability to win new business and cause our actual results to differ materially and adversely from those anticipated
In addition to attracting and retaining qualified technical personnel we believe that our success will depend on the continued employment of our senior management team and its ability to generate new business and execute projects successfully Our senior management team is very important to our business because personal reputations and individual business relationships are a critical element of obtaining and maintaining customer engagements in our industry particularly with agencies performing classified operations The loss of any of our senior executives could cause us to lose customer relationships or new business opportunities which could cause actual results to differ materially and adversely from those anticipated
The markets in which we operate include a large number of participants and are highly competitive Many of our competitors may compete more effectively than we can because they are larger better financed and better known companies than we are In order to stay competitive in our industry we must also keep pace with changing technologies and customer preferences If we are unable to differentiate our services from those of our competitors our revenues may decline In addition our competitors have established relationships among themselves or with third parties to increase their ability to address customer needs As a result new competitors or alliances among competitors may emerge and compete more effectively than we can There is also a significant industry trend towards consolidation which may result in the emergence of companies which are better able to compete against us The results of these competitive pressures could cause our actual results to differ materially and adversely from those anticipated
Our quarterly revenues and operating results may fluctuate significantly and unpredictably in the future In particular if the federal government does not adopt or delays adoption of a budget for each fiscal year beginning on October 1 or fails to pass a continuing resolution federal agencies may be forced to suspend our contracts and delay the award of new and follow on contracts and orders due to a lack of funding Further the rate at which the federal government procures technology may be negatively affected following changes in presidential administrations and senior government officials Therefore period to period comparisons of our operating results may not be a good indication of our future performance
An increase in the prices of goods and services could raise the costs associated with providing our services diminish our ability to compete for new contracts or task orders and or reduce customer buying power
We may experience an increase in the costs in our supply and labor markets due to global inflationary pressures and other various geopolitical factors We generate a portion of our revenues through various fixed price and multi year government contracts which anticipate moderate increases in costs over the term of the contract With the current pace of inflation our standard approach to moderate annual price escalations in our bids for multi year work may be insufficient to counter inflationary cost pressures This could result in reduced profits or even losses as inflation increases particularly for fixed priced contracts and our longer term multi year contracts In the competitive environment in which we operate as a government contractor the lack of pricing leverage and ability to renegotiate long term multi year contracts could reduce our profits disrupt our business or otherwise materially adversely affect our results of operations
We generated 27 3 and 30 2 of our total revenues in fiscal 2024 and 2023 respectively from fixed price contracts Fixed price contracts require us to price our contracts by predicting our expenditures in advance In addition some of our engagements obligate us to provide ongoing maintenance and other supporting or ancillary services on a fixed price basis or with limitations on our ability to increase prices Many of our engagements are also on a time and materials basis While these types of contracts are generally subject to less uncertainty than fixed price contracts to the extent that our actual labor costs are higher than the contract rates our actual results could differ materially and adversely from those anticipated
When making proposals for engagements on a fixed price basis we rely on our estimates of costs and timing for completing the projects These estimates reflect our best judgment regarding our capability to complete the task efficiently Any increased or unexpected costs or unanticipated delays in connection with the performance of fixed price contracts including delays caused by factors outside of our control could make these contracts less profitable or unprofitable From time to time unexpected costs and unanticipated delays have caused us to incur losses on fixed price contracts primarily in connection with state government customers On rare occasions these losses have been significant In the event that we encounter such problems in the future our actual results could differ materially and adversely from those anticipated
At June 30 2024 our backlog included cost reimbursable time and materials and fixed price contracts Cost reimbursable and time and materials contracts generally have lower profit margins than fixed price contracts Our earnings and margins may therefore vary materially and adversely depending on the relative mix of contract types the costs incurred in their performance the achievement of other performance objectives and the stage of performance at which the right to receive fees particularly under incentive and award fee contracts is finally determined
One of our key growth strategies has been to selectively pursue acquisitions Through acquisitions we have expanded our base of federal government customers increased the range of solutions we offer to our customers and deepened our penetration of existing markets and customers We may encounter difficulty identifying and executing suitable acquisitions To the extent that management is involved in identifying acquisition opportunities or integrating new acquisitions into our business our management may be diverted from operating our core business Without acquisitions we may not grow as rapidly as we historically have grown which could cause our actual results to differ materially and adversely from those anticipated We may encounter other risks in executing our acquisition strategy including
our failure to discover material liabilities during the due diligence process including the failure of prior owners of any acquired businesses or their employees to comply with applicable laws or regulations such as the Federal Acquisition Regulation and health safety and environmental laws or their failure to fulfill their contractual obligations to the federal government or other customers and
The success of our acquisition strategy will depend upon our ability to continue to successfully integrate any businesses we may acquire in the future The integration of these businesses into our operations may result in unforeseen operating difficulties absorb significant management attention and require significant financial resources that would otherwise be available for the ongoing development of our business These integration difficulties include the integration of personnel with disparate business backgrounds the transition to new information systems coordination of geographically dispersed organizations loss of key employees of acquired companies and reconciliation of different corporate cultures For these or other reasons we may be unable to retain key customers of acquired companies Moreover any acquired business may fail to generate the revenues or net income we expected or produce the efficiencies or cost savings we anticipated Any of these outcomes could cause our actual results to differ materially and adversely from those anticipated
We have substantial investments in recorded goodwill as a result of prior acquisitions and changes in future business conditions could cause these investments to become impaired requiring substantial write downs that would reduce our operating income
As of June 30 2024 goodwill accounts for 4 2 billion of our recorded total assets We evaluate the recoverability of recorded goodwill amounts annually or when evidence of potential impairment exists The annual impairment test is based on several factors requiring judgment Principally a decrease in expected reporting unit cash flows or changes in market conditions may indicate potential impairment of recorded goodwill If there is an impairment we would be required to write down the recorded amount of goodwill which would be reflected as a charge against operating income
Our senior secured credit facility the Credit Facility imposes certain restrictions on our ability to take certain actions which may have an impact on our business operating results and financial condition
The Credit Facility imposes certain operating and financial restrictions on us and requires us to meet certain financial covenants These restrictions may significantly limit or prohibit us from engaging in certain transactions and include the following
The failure to comply with any covenants in the Credit Facility would cause a default under the Credit Facility A default if not waived could cause our debt to become immediately due and payable In such situations we may not be able to repay our debt or borrow sufficient funds to refinance it and even if new financing is available it may not contain terms that are acceptable to us
The Credit Facility consists of a 1 975 0 million revolving credit facility the Revolving Facility and a 1 225 0 million term loan facility the Term Loan The Revolving Facility has sub facilities of 100 0 million for same day swing line loan borrowings and 25 0 million for stand by letters of credit At any time and so long as no default has occurred the Company has the right to increase the Revolving Facility or the Term Loan in an aggregate principal amount of up to the greater of 500 0 million and 75 of the Company s EBITDA plus an unlimited amount of indebtedness subject to
times calculated assuming the revolving Facility is fully drawn with applicable lender approvals As of June 30 2024 415 0 million was outstanding under the Revolving Facility and 1 133 1 million was outstanding under the Term Loan In addition the terms of the Credit Facility allow us to incur additional indebtedness from other sources so long as we satisfy the covenants in the agreement governing the Credit Facility If new debt is added to our current debt levels the risks related to our ability to service that debt could increase
The Credit Facility matures on December 13 2026 Principal payments under the term loan are due in quarterly installments Our business may not generate cash flow from operations sufficient to service our debt and make necessary capital expenditures If we are unable to generate such cash flow we may be required to adopt one or more alternatives such as selling assets restructuring debt or obtaining additional equity capital on terms that may be onerous or highly dilutive
We must observe laws and regulations relating to the formation administration and performance of federal government contracts which affect how we do business with our customers and may impose added costs on our business For example the Federal Acquisition Regulation and the industrial security regulations of the DoD and related laws include provisions that
Our failure to comply with these or other laws and regulations could result in contract termination loss of security clearances suspension or debarment from contracting with the federal government civil fines and damages and criminal prosecution and penalties any of which could cause our actual results to differ materially and adversely from those anticipated
Any systems failures including network software or hardware failures whether caused by us a third party service provider unauthorized intruders and hackers computer viruses natural disasters power shortages or terrorist attacks could cause loss of data or interruptions or delays in our business or that of our customers Like other global companies we have experienced cyber security threats to our data and systems our company sensitive information and our information technology infrastructure including malware and computer virus attacks unauthorized access systems failures and temporary disruptions Prior cyber attacks directed at us have not had a material adverse impact on our business or our financial results and we believe that our continuing commitment toward threat detection and mitigation processes and procedures will reduce such impact in the future Due to the evolving nature of these security threats however the impact of any future incident cannot be predicted In addition the failure or disruption of our mail communications or utilities could cause us to interrupt or suspend our operations or otherwise harm our business Our property and business interruption insurance may be inadequate to compensate us for all losses that may occur as a result of any system or operational failure or disruption and as a result our actual results could differ materially and adversely from those anticipated
The systems and networks that we maintain for our customers although highly redundant in their design could also fail If a system or network we maintain were to fail or experience service interruptions we might experience loss of revenues or face claims for damages or contract termination Our errors and omissions liability insurance may be inadequate to compensate us for all the damages that we might incur and as a result our actual results could differ materially and adversely from those anticipated
Many of the systems that we develop integrate maintain otherwise support or use involve managing and protecting intelligence national security and other sensitive government information While we have programs designed to protect such information and comply with all relevant privacy and security requirements the threats that our clients face have grown more frequent and sophisticated A security breach or system failure in a system that we develop integrate maintain or otherwise support could result in a loss of revenues remediation costs claims for damages or contract termination and our errors and omissions liability insurance may be inadequate to compensate us for all the damages that we might incur Any such event could also cause serious damage to our reputation and prevent us from having access to or being eligible for further work on such sensitive systems for U S government customers
In addition in order to provide services to our customers we often depend upon or use customer systems that are supported by the customer or third parties Any security breach or system failure in such systems could result in an interruption of our customer s operations significant delays under a contract and a material adverse effect on our results of operations
Our operations involve several risks and hazards including potential dangers to our employees and to third parties that are inherent in aspects of our federal business e g counterterrorism training services If these risks and hazards are not adequately insured it could adversely affect our operating results
Our federal business includes the maintenance of global networks and the provision of special operations services e g counterterrorism training that require us to dispatch employees to various countries around the world These countries may be experiencing political upheaval or unrest and in some cases war or terrorism It is possible that certain of our employees or executives will suffer injury or bodily harm or be killed or kidnapped in the course of these deployments We could also encounter unexpected costs for reasons beyond our control in connection with the repatriation of our employees or executives Any of these types of accidents or other incidents could involve significant potential claims of employees executives and or third parties who are injured or killed or who may have wrongful death or similar claims against us
We maintain insurance policies that mitigate against risk and potential liabilities related to our operations This insurance is maintained in amounts that we believe are reasonable However our insurance coverage may not be adequate to cover those claims or liabilities and we may be forced to bear significant costs from an accident or incident Substantial claims in excess of our related insurance coverage could cause our actual results to differ materially and adversely from those anticipated
Our success depends in part upon our ability to protect our proprietary information Although our employees are subject to confidentiality obligations this protection may be inadequate to deter misappropriation of our proprietary information In addition we may be unable to detect unauthorized use of our proprietary information in order to take appropriate steps to enforce our rights If we are unable to prevent third parties from infringing or misappropriating our proprietary information our competitive position could be harmed and our actual results could differ materially and adversely from those anticipated
We conduct the majority of our international operations in the U K and the Netherlands As a percentage of our total revenues our international operations generated 3 0 and 2 8 in fiscal 2024 and 2023 respectively Our international operations are subject to risks associated with operating in a foreign country These risks include fluctuations in the value of the British pound and the Euro longer payment cycles changes in foreign tax laws and regulations and unexpected legislative regulatory economic or political changes
CACI is committed to maintaining a robust cybersecurity management and oversight program to mitigate cybersecurity risks to our systems and to protect both our and our customer s confidential and sensitive information We employ technologies and have implemented programs and processes to continually assess identify and manage cybersecurity risks as we aim to incorporate industry best practices throughout our cybersecurity program
CACI s cybersecurity program is integrated into our overall risk management program and is primarily managed by our Chief Information Security Officer CISO who is responsible for coordinating cross functional internal and external resources to establish processes and procedures to monitor potential cybersecurity risks identify cybersecurity incidents implement appropriate mitigation measures report cybersecurity breaches and maintain our cybersecurity program Our CISO has extensive experience assessing and managing cybersecurity programs and cybersecurity risk and monitors prevention detection mitigation and remediation efforts through regular communication and reporting from experienced cybersecurity professionals in the information security team and with technological tools and software We continuously monitor cybersecurity threats and assess the robustness of our mitigation and prevention measures through routine internal and independent audits threat simulations vulnerability and penetration testing and employee cybersecurity training Our cybersecurity program is designed to be aligned with applicable industry standards and we continue to invest in capabilities to protect all information assets in our possession
As a government contractor we have designed our cybersecurity risk management program to align with the National Institute of Standards and Technology NIST standards and comply with extensive regulations including but not limited to U S government cybersecurity regulations Additionally our cybersecurity program is routinely assessed by the government and our network is penetration tested biannually by a third party independent assessor We work closely with our subcontractors and suppliers to identify and manage cybersecurity risks and as appropriate require them to comply with applicable laws and regulations including implementing certain security controls and complying with certain reporting obligations Although we perform due diligence on all service providers to identify potential cybersecurity risks and establish controls through onboarding procedures and contractual requirements our ability to monitor the cybersecurity practices of our service providers and ensure that we can prevent or mitigate the risk of any compromise or failure in the information system software networks and other assets owned or controlled by our vendors is limited
In the event of a cybersecurity incident the Company has established an incident response plan to address the matter promptly and effectively Our CISO leads our Cybersecurity Incident Response Team CIRT that is responsible for leading and coordinating CACI s response to cybersecurity incidents in accordance with CACI s established cybersecurity incident response plan and response processes In accordance with these policies cybersecurity events and data incidents are evaluated ranked by severity and prioritized for escalation to CACI s Executive Incident Assessment Committee The plan includes procedures for investigating and containing incidents notifying affected parties and implementing corrective actions to prevent future occurrences
The Audit and Risk Committee Audit Committee has oversight responsibility for risks and incidents relating to cybersecurity including compliance with regulatory requirements cooperation with law enforcement and related effects on financial and other risks The Audit Committee receives regular briefings on our cybersecurity posture cybersecurity trends and cybersecurity risks from management and if they occur is briefed regarding any material cybersecurity incidents The Audit Committee reports any findings or recommendations to the Board as appropriate
To date we have not identified any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business operations or financial condition While the Company has taken significant steps to manage cybersecurity risks there can be no assurance that these measures will prevent all potential incidents For more information on our cybersecurity related risks see Item 1A Risk Factors of this Annual Report on Form 10 K
As of June 30 2024 we leased building space including offices manufacturing plants warehouses laboratories and other facilities at 127 U S locations containing an aggregate of approximately 3 5 million square feet located in 26 states and the District of Columbia In four countries outside the U S we leased office space at 11 locations containing an aggregate of approximately 0 1 million square feet Our corporate headquarters is located at 12021 Sunset Hills Road Reston Virginia We believe our facilities are in good condition and adequate for their current use We may improve replace or reduce facilities as considered appropriate to meet the needs of our operations See Note 10 Leases in Part II of this Annual Report on Form 10 K for additional information
On June 30 2008 Plaintiff Al Shimari filed a twenty count complaint in the United States District Court for the Southern District of Ohio Plaintiff Al Shimari is an Iraqi who claimed that he suffered significant physical injury and emotional distress while held at Abu Ghraib prison in Iraq The lawsuit named CACI International Inc CACI Premier Technology Inc and former CACI employee Timothy Dugan as Defendants along with L 3 Services Inc The complaint alleged that the Defendants conspired with U S military personnel to engage in illegal treatment of Iraqi detainees The complaint did not allege any interaction between Plaintiff Al Shimari and any CACI employee Plaintiff Al Shimari sought inter alia compensatory damages punitive damages and attorney s fees On August 8 2008 the court granted CACI s motion to transfer the action to the United States District Court for the Eastern District of Virginia Thereafter an amended complaint was filed adding three plaintiffs On September 12 2008 Mr Dugan was dismissed from the case without prejudice On October 2 2008 CACI filed a motion to dismiss the case CACI also moved to stay discovery pending further proceedings The court granted CACI s motion to stay discovery On March 18 2009 the court granted in part and denied in part CACI s motion to dismiss On March 23 2009 CACI filed a notice of appeal with respect to the March 18 2009 decision Plaintiffs filed a motion to strike CACI s notice of appeal and a motion to lift the stay on discovery The United States District Court for the Eastern District of Virginia denied both motions On April 27 2009 Plaintiffs filed a motion to dismiss the appeal in the United States Court of Appeals for the Fourth Circuit The United States Court of Appeals for the Fourth Circuit deferred any ruling on Plaintiffs motion and issued a briefing schedule Plaintiffs filed a notice of cross appeal which CACI moved to dismiss The Court of Appeals dismissed the Plaintiffs cross appeal On October 26 2010 the United States Court of Appeals for the Fourth Circuit heard oral argument in the appeal and took the matter under advisement On September 21 2011 the United States Court of Appeals for the Fourth Circuit reversed the decision of the United States District Court for the Eastern District of Virginia and remanded the action with instructions to dismiss the action On October 5 2011 Plaintiffs filed a petition for a rehearing en banc which the Court of Appeals granted The Court of Appeals also invited the United States to participate in the en banc rehearing of the appeal as amicus curiae The United States participated in that capacity in the en banc rehearing On January 27 2012 the Court of Appeals sitting en banc heard oral argument On May 11 2012 the Court of Appeals in an 11 3 decision held that it lacked jurisdiction over the appeal and dismissed the appeal The action returned to the district court for further proceedings
On October 12 2012 the district court conducted a status conference at which the court asked the parties to prepare and submit a plan for discovery in the action The parties subsequently filed a joint discovery plan which the court approved The Court also lifted the stay of discovery and reinstated the claims arising under the Alien Tort Statute ATS that the Court had previously dismissed On December 26 2012 Plaintiffs filed a Second Amended Complaint Defendants moved to dismiss several counts of the Second Amended Complaint On March 8 2013 the Court dismissed the conspiracy claims in the Second Amended Complaint and dismissed CACI International Inc from the action Subsequently the Court allowed Plaintiffs to file a Third Amended Complaint for the purpose of repleading the conspiracy claims On March 28 2013 Plaintiffs filed a Third Amended Complaint and on April 15 2013 Defendant CACI Premier Technology Inc moved to dismiss the conspiracy claims in the Third Amended Complaint
On March 19 2013 the Court granted a motion for reconsideration filed by Defendants with respect to the statute of limitations applicable to the common law tort claims of three of the four Plaintiffs and dismissed those claims Defendant CACI Premier Technology Inc also filed a motion for sanctions with respect to the failure of three of the four Plaintiffs to appear for depositions and medical examinations as ordered by the court On April 12 2013 the Court denied that motion but entered an order requiring the three Plaintiffs to appear for depositions and medical examinations no later than April 26 2013 and stating that if the three Plaintiffs did not comply with the order their claims were subject to dismissal Plaintiffs did not appear for depositions in the United States as of April 26 2013 Defendant CACI Premier Technology Inc then renewed its motion for sanctions seeking dismissal for the three Plaintiffs violation of the Court order to appear for depositions and medical examinations Defendant CACI Premier Technology Inc also filed a motion to dismiss the ATS claims of all four Plaintiffs for lack of jurisdiction in light of the U S Supreme Court s April 17 2013 decision in Kiobel v Royal Dutch Petroleum and a motion to dismiss the common law claims of the single Plaintiff with those claims on various grounds
On June 26 2013 the Court issued a Memorandum Opinion and Order granting Defendant CACI Premier Technology Inc s motions with respect to Plaintiffs ATS claims and Plaintiffs common law claims and dismissing the Third Amended Complaint without prejudice The Court also denied all other pending motions including Defendant CACI Premier Technology Inc s motions for sanctions and to dismiss the conspiracy claims as moot
On March 18 2014 a three judge panel of the United States Court of Appeals for the Fourth Circuit held a hearing on Plaintiffs appeal and took the matters under advisement On June 30 2014 the three judge panel vacated the district court s June 26 2013 Order and remanded Plaintiffs claims for further proceeding
On remand Defendant CACI Premier Technology Inc moved to dismiss Plaintiffs claims based upon the political question doctrine On June 18 2015 the Court issued an Order granting Defendant CACI Premier Technology Inc s motion to dismiss and on June 26 2015 entered a final judgment in favor of Defendant CACI Premier Technology Inc
On July 23 2015 Plaintiffs filed a Notice of Appeal of the district court s June 2015 decision On October 21 2016 the Court of Appeals vacated and remanded the District Court s judgment with instructions for the District Court to make further determinations regarding the political question doctrine The District Court conducted an initial status conference on December 16 2016 On June 9 2017 the District Court dismissed Plaintiff Rashid without prejudice from the action based upon his inability to participate On July 19 2017 CACI Premier Technology Inc filed a motion to dismiss the action on numerous legal grounds The Court held a hearing on that motion on September 22 2017 and denied the motion pending issuance of a written decision On January 17 2018 CACI filed a third party complaint naming the United States and John Does 1 60 asserting claims for contribution indemnification exoneration and breach of contract in the event that CACI Premier Technology Inc is held liable to Plaintiffs as Plaintiffs are seeking to hold CACI Premier Technology Inc liable on a co conspirator theory and a theory of aiding and abetting On February 21 2018 the District Court issued a Memorandum Opinion and Order dismissing with prejudice the claims of direct abuse of the Plaintiffs by CACI personnel Counts 1 4 and 7 of the Third Amended Complaint in response to the motion to dismiss filed by CACI on July 19 2017 and denying the balance of the motion to dismiss On March 14 2018 the United States filed a motion to dismiss the third party complaint or in the alternative for summary judgment On April 13 2018 the Court held a hearing on the United States motion to dismiss and took the matter under advisement
On April 13 2018 the Plaintiffs filed a motion to reinstate Plaintiff Rashid which CACI opposed On April 20 2018 the District Court granted that motion subject to Plaintiff Rashid appearing for a deposition On May 21 2018 CACI filed a motion to dismiss for lack of subject matter jurisdiction based on a recent Supreme Court decision On June 25 2018 the District Court denied that motion On October 25 2018 the District Court conducted a pre trial conference at which the District Court addressed remaining discovery matters the scheduling for dispositive motions that CACI intends to file and set a date of April 23 2019 for trial if needed to start On December 20 2018 CACI filed a motion for summary judgment and a motion to dismiss based on the state secrets privilege On January 3 2019 CACI filed a motion to dismiss for lack of subject matter jurisdiction On February 15 2019 the United States filed a motion for summary judgment with respect to CACI s third party complaint On February 27 2019 the District Court denied CACI s motion for summary judgment and motions to dismiss for lack of subject matter jurisdiction and on the state secrets privilege On February 28 2019 CACI filed a motion seeking dismissal on grounds of derivative sovereign immunity
On March 22 2019 the District Court denied the United States motion to dismiss on grounds of sovereign immunity and CACI s motion to dismiss on grounds of derivative sovereign immunity The District Court also granted the United States motion for summary judgment with respect to CACI s third party complaint On March 26 2019 CACI filed a Notice of Appeal of the District Court s March 22 2019 decision On April 2 2019 the U S Court of Appeals for the Fourth Circuit issued an Accelerated Briefing Order for the appeal On April 3 2019 the District Court issued an Order cancelling the trial schedule and holding matters in abeyance pending disposition of the appeal On July 10 2019 the U S Court of Appeals for the Fourth Circuit heard oral argument in Spartanburg South Carolina on CACI s appeal On August 23 2019 the Court of Appeals issued an unpublished opinion dismissing the appeal A majority of the panel that heard the appeal held that rulings denying derivative sovereign immunity are not immediately appealable even where they present pure questions of law The panel also ruled in the alternative that even if such a ruling was immediately appealable review was barred because there remained disputes of material fact with respect to CACI s derivative sovereign immunity defenses The Court of Appeals subsequently denied CACI s request for rehearing
On October 11 2019 the Court of Appeals by a 2 1 vote denied the motion to stay issuance of the mandate CACI then filed an application to stay issuance of the mandate with Chief Justice Roberts in his capacity as Circuit Justice for the U S Court of Appeals for the Fourth Circuit After CACI filed that application the Court of Appeals issued the mandate on October 21 2019 returning jurisdiction to the district court On October 23 Chief Justice Roberts denied the stay application without prejudice to applicants filing a new application after seeking relief in the district court CACI then filed a motion in the district court to stay the action pending filing and disposition of a petition for a writ of
in the U S Supreme Court On January 27 2020 the U S Supreme Court issued an Order inviting the Solicitor General to file a brief in the case expressing the views of the United States On August 26 2020 the Solicitor General filed a brief recommending that CACI s petition for a writ of
cases holding that the allegations of domestic conduct in the cases were general corporate activity insufficient to establish subject matter jurisdiction As a result the Supreme Court remanded the cases for dismissal On June 28 2021 the Supreme Court denied CACI s petition for a writ of
On July 16 2021 the District Court granted CACI s consent motion to lift the stay of the action and ordered the parties to submit status reports to the District Court by August 4 2021 On July 23 2021 CACI filed a motion to dismiss the action for lack of subject matter jurisdiction based on among other things the recent Supreme Court decision in the
On September 10 2021 the Court conducted a hearing on CACI s motion to dismiss for lack of subject matter jurisdiction and took the motion under advisement The Court issued an Order directing the plaintiffs to provide the Court with a calculation of specific damages sought by each plaintiff In response plaintiffs advised the Court that if the case is tried they do not intend to request a specific amount of damages
On October 1 2021 the plaintiffs filed an estimate of compensatory damages between 6 0 million and 9 0 million 2 0 million to 3 0 million per plaintiff and an estimate of punitive damages between 23 5 million and 64 0 million
On July 18 2022 CACI filed a memorandum of supplemental authority in support of its motion to dismiss filed on July 23 2021 asserting that a recent decision from the U S Court of Appeals for the Fourth Circuit regarding the test for extraterritoriality supported dismissal for lack of subject matter jurisdiction Also on July 18 2022 CACI filed a second motion to dismiss for lack of subject matter jurisdiction on the grounds that three decisions issued by the Supreme Court in June 2022 demonstrate that courts should not recognize claims under the ATS that arise out of the United States prosecution of war
On July 31 2023 the District Court denied the July 23 2021 motion to dismiss and the July 18 2022 motion to dismiss On September 7 2023 CACI filed a petition for a writ of mandamus with the U S Court of Appeals for the Fourth Circuit asserting that the District Court had disregarded binding precedent and asking the Court of Appeals to dismiss the action for lack of subject matter jurisdiction On September 13 2023 the Court of Appeals issued an Order requiring the plaintiffs to respond to the petition On September 25 2023 the plaintiffs filed their response to CACI s petition opposing the relief sought On October 2 2023 the District Court entered an Order setting the case for a jury trial on April 15 2024 On November 2 2023 the Court of Appeals denied without opinion the petition for a writ of mandamus Trial commenced on April 15 2024 During trial the plaintiffs abandoned their claim of war crimes On May 9 2024 the jury notified the District Court that it was deadlocked and could not reach a unanimous verdict on any claim The District Court then dismissed the jury and declared a mistrial
On May 16 2024 plaintiffs filed a motion for a new trial and CACI filed a motion for judgment as a matter of law On June 14 2024 the District Court granted plaintiffs motion denied CACI s motion and proposed dates in October 2024 for a new trial The District Court subsequently scheduled the new trial to start on October 30 2024
On September 20 2013 fifty five Plaintiffs filed a nine count complaint in the United States District Court for the Eastern District of Virginia styled Abbass et al v CACI Premier Technology Inc et al Plaintiffs are Iraqi nationals who assert that their allegations are essentially the same as those of the plaintiffs in Al Shimari Plaintiffs claim that they suffered significant physical injury and emotional distress while in U S custody in Iraq The lawsuit names CACI International Inc and CACI Premier Technology Inc as Defendants The complaint alleges that Defendants conspired with U S military personnel to engage in illegal treatment of Iraqi detainees The complaint does not allege any interaction between Plaintiffs and any CACI employee Plaintiffs claims are brought pursuant to the Alien Tort Statute and the Torture Victims Protection Act Plaintiffs seek inter alia compensatory damages punitive damages and attorney s fees
Plaintiffs action was originally filed in 2009 in U S District Court for the District of Columbia but was voluntarily dismissed without prejudice in September 2011 after the Supreme Court denied certiorari in Saleh v Titan Corp and Ibrahim v Titan Corp 580 F 3d 1 D C Cir 2009
The CACI Defendants have moved to dismiss the complaint Before deciding the motion to dismiss the district court stayed the action pending a decision from the Court of Appeals in Al Shimari v L 3 Services Inc
On September 13 2021 the Court issued an Order directing plaintiffs counsel to file a report advising the Court of the status of each plaintiff and indicating that any plaintiff whom counsel is unable to contact may be dismissed from the action On October 4 2021 plaintiffs counsel filed a memorandum stating that the action was brought by forty six plaintiffs and that plaintiffs counsel was in contact with many of the plaintiffs but needed additional time to provide the Court with a final report On October 4 2021 the Court entered an Order extending plaintiffs response to October 25 2021 On October 25 2021 plaintiffs counsel filed a memorandum stating that he was in communication with 46 plaintiffs or their representatives
On June 21 2024 CACI filed a motion to lift the stay Plaintiffs filed an opposition to that motion on June 26 2024 On June 28 2024 the District Court denied CACI s motion without prejudice CACI subsequently filed a Notice of Appeal to the U S Court of Appeals for the Fourth Circuit as well as a Petition for a Writ of Mandamus in the Court of Appeals asking the Court of Appeals to issue an order requiring the District Court to lift the stay
We have never paid a cash dividend Our present policy is to retain earnings to provide funds for the operation and expansion of our business We do not intend to pay any cash dividends at this time The Board of Directors will determine whether to pay dividends in the future based on conditions existing at that time including our earnings financial condition and capital requirements as well as economic and other conditions as the board may deem relevant
As of July 26 2024 the number of stockholders of record of our common stock was approximately 155 The number of stockholders of record is not representative of the number of beneficial stockholders due to the fact that many shares are held by depositories brokers or nominees
The following graph compares the cumulative five year total return to shareholders on CACI International Inc s common stock relative to the cumulative total returns of the Russell 1000 index and the Dow Jones U S Computer Services Total Stock Market index The graph assumes that the value of the investment in our common stock and in each of the indexes including reinvestment of dividends was 100 on June 30 2019 and tracks it through June 30 2024
The following discussion and analysis of our financial condition and results of operations is provided to enhance the understanding of and should be read together with our consolidated financial statements and the Notes to those statements that appear elsewhere in this Annual Report on Form 10 K This discussion contains forward looking statements that involve risks and uncertainties Unless otherwise specifically noted all years refer to our fiscal year which ends on June 30
In this section we discuss our financial condition changes in financial condition and results of our operations for fiscal 2024 compared to fiscal 2023 For a discussion and analysis comparing our results for fiscal 2023 to fiscal 2022 see our Annual Report on Form 10 K for fiscal 2023 filed with the SEC on August 10 2023 under Part II Item 7 Management s Discussion and Analysis of Financial Condition and Results of Operations
We are a leading provider of Expertise and Technology to customers in support of national security in the intelligence defense and federal civilian sectors both domestically and internationally The demand for our Expertise and Technology in large measure is created by the increasingly complex network systems and information environments in which governments and businesses operate and by the need to stay current with emerging technology while increasing productivity enhancing security and ultimately improving performance
We carefully follow federal budget legislative and contracting trends and activities and evolve our strategies to take these into consideration For the government fiscal year GFY ending September 30 2023 GFY23 defense and nondefense funding levels represented increases of approximately 10 and 6 respectively over GFY22 enacted levels On June 3 2023 the President signed into law legislation that suspended the federal debt limit until January 2025 and capped discretionary spending in GFY24 and GFY25 Specifically GFY24 defense spending is capped at 886 billion an increase of 3 and in line with the President s GFY24 budget request and GFY24 nondefense spending is capped at levels similar to GFY22 though after various adjustments would essentially be flat with GFY23 levels For GFY25 discretionary spending growth both defense and nondefense is capped at 1 On March 23 2024 the President signed into law an appropriations bill that funds the federal government for GFY24 generally consistent with the terms set forth in the debt limit legislation signed in June 2023 Earlier in March the President released his GFY25 budget request that was also generally consistent with the terms set forth in the debt limit legislation signed in June 2023 While future levels of defense and nondefense spending may vary and are difficult to project we believe that there continues to be bipartisan support for defense and national security related spending particularly given the heightened current global threat environment including the conflict in Ukraine
While we view the budget environment as constructive and believe there is bipartisan support for continued investment in the areas of defense and national security it is uncertain when in any particular GFY that appropriations bills will be passed During those periods of time when appropriations bills have not been passed and signed into law government agencies operate under a continuing resolution CR a temporary measure allowing the government to continue operations at prior year funding levels
Depending on their scope duration and other factors CRs can negatively impact our business due to delays in new program starts delays in contract award decisions and other factors When a CR expires unless appropriations bills have been passed by Congress and signed by the President or a new CR is passed and signed into law the government must cease operations or shutdown except in certain emergency situations or when the law authorizes continued activity We continuously review our operations in an attempt to identify programs potentially at risk from CRs so that we can consider appropriate contingency plans
We provide Expertise and Technology to government customers We believe that the total addressable market for our offerings is sufficient to support the Company s plans and is expected to continue to grow over the next several years Approximately 70 of our revenue comes from defense related customers including those in the Intelligence Community IC with additional revenue coming from non defense IC homeland security and other federal civilian customers
We continue to align the Company s capabilities with well funded budget priorities and take steps to maintain a competitive cost structure in line with our expectations of future business opportunities In light of these actions as well as the budgetary environment discussed above we believe we are well positioned to continue to win new business in our large addressable market We believe that the following trends will influence the USG s spending in our addressable market
We believe that our customers use of lowest price technically acceptable LPTA procurements which contributed to pricing pressures in past years has moderated though price still remains an important factor in procurements We also continue to see protests of major contract awards and delays in USG procurement activities In addition many of our federal government contracts require us to employ personnel with security clearances specific levels of education and specific past work experience Depending on the level of clearance security clearances can be difficult and time consuming to obtain and competition for skilled personnel in the information technology services industry is intense Additional factors that could affect USG spending in our addressable market include changes in set asides for small businesses changes in budget priorities and budgetary priorities limiting or delaying federal government spending in general
Federal civilian agencies revenues primarily include Expertise and Technology provided to non DoD agencies and departments of the U S federal government including intelligence agencies and Departments of Justice Agriculture Health and Human Services and State
Commercial and other revenues primarily include Expertise and Technology provided to U S state and local governments commercial customers and certain foreign governments and agencies through our International reportable segment
The increase in direct costs was primarily attributable to direct labor and subcontractor costs from organic growth on existing programs and higher materials costs As a percentage of revenues total direct costs were 67 2 and 65 7 for fiscal 2024 and 2023 respectively Direct costs include direct labor subcontractor costs materials and other direct costs
As a percentage of revenues indirect costs and selling expenses were 22 5 and 23 7 for fiscal 2024 and 2023 respectively driven by cost efficiencies across the Company The increase in indirect costs and selling expenses was primarily attributable to an increase in fringe benefit expenses on a higher labor base
s effective income tax rate was 22 9 and 20 4 for fiscal 2024 and 2023 respectively The effective tax rate for fiscal 2024 was favorably impacted by research and development tax credits offset by state income taxes The effective tax rate for fiscal 2023 was favorably impacted primarily by federal research tax credits and the remeasurement of state deferred taxes See Note 16 Income Taxes in Part II of this Annual Report on Form 10 K for additional information
The Company s backlog represents value on existing contracts that has the potential to be recognized into revenues as work is performed The Company includes unexercised option years in its backlog and excludes the value of task orders that may be awarded under multiple award IDIQ vehicles until such task orders are issued
As of June 30 2024 the Company had total backlog of 31 6 billion compared with 25 8 billion a year ago an increase of 22 5 Funded backlog as of June 30 2024 was 3 8 billion The total backlog consists of remaining performance obligations plus unexercised options See Note 5 Revenues in Part II of this Annual Report on Form 10 K for additional information related to remaining performance obligations
There is no assurance that all funded or potential contract value will result in revenues being recognized The Company continues to monitor backlog as it is subject to change from execution of new contracts contract modifications or extensions government deobligations early terminations or other factors Based on this analysis an adjustment to the period end balance may be required
This contract type provides for reimbursement of allowable direct expenses and allocable indirect expenses plus an additional negotiated fee The fee component of the contract may include fixed fees award fees and incentive fees Fixed fees are fees that are negotiated and fixed at the inception of the contract In general award fees are more subjective in performance criteria and are earned based on overall cost schedule and technical performance as measured against contractual requirements Incentive fees have more objective cost or performance criteria and generally contain a formula based on the relationship of actual costs incurred to target costs
This contract type provides for a fixed price for specified Expertise and Technology and is often used when there is more certainty regarding the estimated costs to complete the contractual statement of work Since the contractor bears the risk of cost overruns there is higher risk and potential profit associated with this contract type
This contract type provides for a fixed hourly rate for defined contractual labor categories with reimbursement of billable material and other direct costs For this contract type the contractor bears the risk that its labor costs and allocable indirect expenses are greater than the fixed hourly rate defined within the contract
As discussed further within Item 1A Risk Factors in this Annual Report on Form 10 K our earnings and margins may vary based on the mix of our contract types We generated the following revenues by contract type for the periods presented
During fiscal 2024 60 8 of our revenues were generated under cost reimbursable contracts which automatically adjust revenues to cover costs that are affected by inflation 11 9 of our revenues were generated under time and materials contracts where we adjust labor rates periodically as permitted The remaining portion of our business is fixed price and may span multiple years We generally have been able to price our time and materials and fixed price contracts in a manner that accommodates the rates of inflation experienced in recent years
Existing cash and cash equivalents and cash generated by operations are our primary sources of liquidity as well as sales of receivables under our Master Accounts Receivable Purchase Agreement MARPA and available borrowings under our Credit Facility As of June 30 2024 we had 134 0 million in cash and cash equivalents
The Company has a 3 200 0 million Credit Facility which consists of an 1 975 0 million Revolving Facility and a 1 225 0 million Term Loan The Revolving Facility is a secured facility that permits continuously renewable borrowings and has subfacilities of 100 0 million for same day swing line borrowings and 25 0 million for stand by letters of credit As of June 30 2024 1 133 1 million was outstanding under the Term Loan 415 0 million was outstanding under the Revolving Facility and no borrowings on the swing line
The Term Loan is a five year secured facility under which principal payments are due in quarterly installments of 7 7 million through December 31 2023 and 15 3 million thereafter until the balance is due in full on December 13 2026 The Credit Facility contains customary financial and restrictive covenants with which we have been in compliance since inception
Interest rates applicable to loans under the Credit Facility are floating interest rates that at our option equal a base rate or a Secured Overnight Financing Rate SOFR rate plus in each case an applicable margin based upon our consolidated total net leverage ratio
During fiscal year 2023 a provision of the Tax Cuts and Jobs Act of 2017 TCJA went into effect which eliminated the option to deduct domestic research and development costs in the year incurred and instead requires taxpayers to capitalize and amortize such costs over five years This provision decreased fiscal year 2024 cash flows from operations by 73 9 million and increased net deferred tax assets by a similar amount The future impact of this provision will depend on any guidance issued by the Treasury Department regarding the identification of appropriate costs for capitalization and the amount of future research and development expenses paid or incurred among other factors
Net cash used in financing activities increased 10 8 million primarily as a result of a 117 3 million increase in net repayments under our Credit Facility partially offset by a 111 7 million decrease in repurchases of our common stock
We believe that the combination of internally generated funds available bank borrowings and cash and cash equivalents on hand will provide the required liquidity and capital resources necessary to fund on going operations customary capital expenditures debt service obligations and other working capital requirements over the next twelve months We may in the future seek to borrow additional amounts under a long term debt security Over the longer term our ability to generate sufficient cash flows from operations necessary to fulfill the obligations under the Credit Facility and any other indebtedness we may incur will depend on our future financial performance which will be affected by many factors outside of our control including current worldwide economic conditions and financial market conditions
For a description of the Company s contractual obligations related to debt leases and retirement plans refer to Note 10 Leases Note 12 Debt and Note 17 Retirement Plans in Part II of this Annual Report on Form 10 K
We are subject to a number of reviews investigations claims lawsuits other uncertainties and future obligations related to our business For a discussion of these items see Note 19 Commitments and Contingencies in Part II of this Annual Report on Form 10 K
The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the U S requires us to make estimates and judgments that affect the amounts reported in those financial statements and accompanying notes We consider the accounting policies and estimates addressed below to be the most important to our financial position and results of operations either because of the significance of the financial statement item or because they require the exercise of significant judgment and or use of significant estimates Although we believe that the estimates are reasonable based on reasonably available facts due to the inherent uncertainty involved in making those estimates actual results reported in future periods may differ
The Company generates almost all of our revenues from three different types of contractual arrangements with the U S government cost plus fee fixed price and time and materials contracts Our contracts with the U S government are generally subject to the Federal Acquisition Regulation FAR and are competitively priced based on estimated costs of providing the contractual goods or services
We account for a contract when the parties have approved the contract and are committed to perform on it the rights of each party and the payment terms are identified the contract has commercial substance and collectability is probable At contract inception the Company determines whether the goods or services to be provided are to be accounted for as a single performance obligation or as multiple performance obligations This evaluation requires professional judgment as it may impact the timing and pattern of revenue recognition If multiple performance obligations are identified we generally use the cost plus a margin approach to determine the relative standalone selling price of each performance obligation
When determining the total transaction price the Company identifies both fixed and variable consideration elements within the contract Variable consideration includes any amount within the transaction price that is not fixed such as award or incentive fees performance penalties unfunded contract value or other similar items For our contracts with award or incentive fees the Company estimates the total amount of award or incentive fee expected to be recognized into revenue Throughout the performance period we recognize as revenue a constrained amount of variable consideration only to the extent that it is probable that a significant reversal of the cumulative amount recognized to date will not be required in a subsequent period Our estimate of variable consideration is periodically adjusted based on significant changes in relevant facts and circumstances In the period in which we can calculate the final amount of award or incentive fee earned based on the receipt of the customer s final performance score or determining that more objective contractually defined criteria have been fully satisfied the Company will adjust our cumulative revenue recognized to date on the contract
We generally recognize revenues over time throughout the performance period as the customer simultaneously receives and consumes the benefits provided on our services type revenue arrangements This continuous transfer of control for our U S government contracts is supported by the unilateral right of our customer to terminate the contract for a variety of reasons without having to provide justification for its decision For our services type revenue arrangements in which there are a repetitive amount of services that are substantially the same from one month to the next the Company applies the series guidance We use a variety of input and output methods that approximate the progress towards complete satisfaction of the performance obligation including costs incurred labor hours expended and time elapsed measures for our fixed price stand ready obligations For certain contracts primarily our cost plus and time and materials services type revenue arrangements we apply the right to invoice practical expedient in which revenues are recognized in direct proportion to our present right to consideration for progress towards the complete satisfaction of the performance obligation
When a performance obligation has a significant degree of interrelation or interdependence between one month s deliverables and the next when there is an award or incentive fee or when there is a significant degree of customization or modification the Company generally records revenue using a percentage of completion method For these revenue arrangements substantially all revenues are recognized over time using a cost to cost input method based on the ratio of costs incurred to date to total estimated costs at completion When estimates of total costs to be incurred on a contract exceed total revenues a provision for the entire loss on the contract is recorded in the period in which the loss is determined
Contract modifications are reviewed to determine whether they should be accounted for as part of the original performance obligation or as a separate contract When contract modifications add distinct goods or services and increase the contract value by an amount that reflects the standalone selling price those modifications are accounted for as separate contracts When contract modifications include goods or services that are not distinct from those already provided the Company records a cumulative adjustment to revenues based on a remeasurement of progress towards the complete satisfaction of the not yet fully delivered performance obligation
Based on the critical nature of our contractual performance obligations the Company may proceed with work based on customer direction prior to the completion and signing of formal contract documents The Company has a formal review process for approving any such work that considers previous experiences with the customer communications with the customer regarding funding status and our knowledge of available funding for the contract or program
We record all tangible and intangible assets acquired and liabilities assumed in a business combination at fair value as of the acquisition date with any excess purchase consideration recorded as goodwill Determining the fair value of acquired assets and liabilities assumed including intangible assets requires management to make significant judgments about expected future cash flows weighted average cost of capital discount rates and expected long term growth rates During the measurement period not to exceed one year from the acquisition date we may adjust provisional amounts recorded to reflect new information subsequently obtained regarding facts and circumstances that existed as of the acquisition date
Goodwill represents the excess of the fair value of consideration paid for an acquisition over the fair value of the net assets acquired and liabilities assumed as of the acquisition date We recognize purchased intangible assets in connection with our business acquisitions at fair value on the acquisition date Goodwill and intangible assets net represent 68 1 and 69 6 of our total assets as of June 30 2024 and June 30 2023 respectively
We evaluate goodwill for both of our reporting units for impairment at least annually on the first day of the fiscal fourth quarter or whenever events or circumstances indicate that the carrying value may not be recoverable The evaluation includes comparing the fair value of the relevant reporting unit to its respective carrying value including goodwill and utilizes both income and market approaches The analysis relies on significant judgements and assumptions about expected future cash flows weighted average cost of capital discount rates expected long term growth rates and financial measures derived from observable market data of comparable public companies During the fourth quarter of fiscal 2024 we completed our annual goodwill assessment and determined that each reporting unit s fair value significantly exceeded its carrying value
Intangible assets with finite lives are amortized using the method that best reflects how their economic benefits are utilized or if a pattern of economic benefits cannot be reliably determined on a straight line basis over their estimated useful lives which is generally over periods ranging from one to twenty years Intangible assets with finite lives are assessed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable
The interest rates on both the Term Loan and the Revolving Facility are affected by changes in market interest rates We have the ability to manage these fluctuations in part through interest rate hedging alternatives in the form of interest rate swaps We have entered into floating to fixed interest rate swap agreements for an aggregate notional amount of 1 100 0 million related to a portion of our floating rate indebtedness All remaining balances under our Term Loan and any additional amounts that may be borrowed under our Revolving Facility are currently subject to interest rate fluctuations With every one percent fluctuation in the applicable interest rate interest expense on our variable rate debt for the twelve months ended June 30 2024 would have fluctuated by approximately 7 4 million
Approximately 3 0 and 2 8 of our total revenues in fiscal 2024 and 2023 respectively were generated from our international operations headquartered in the U K Our practice in our international operations is to negotiate contracts in the same currency in which the predominant expenses are incurred thereby mitigating the exposure to foreign currency exchange rate fluctuations To the extent that it is not possible to do so there is some risk that profits will be affected by foreign currency exchange rate fluctuations As of June 30 2024 we held a combination of euros and pounds sterling in the U K and in the Netherlands equivalent to approximately 78 8 million Although these balances are generally available to fund ordinary business operations without legal or other restrictions a significant portion is not immediately available to fund U S operations unless repatriated Our intention is to reinvest earnings from our foreign subsidiaries This allows us to better utilize our cash resources on behalf of our foreign subsidiaries thereby mitigating foreign currency conversion risks
We have audited the accompanying consolidated balance sheets of CACI International Inc and its subsidiaries the Company as of June 30 2024 and 2023 and the related consolidated statements of operations of comprehensive income of shareholders equity and of cash flows for each of the two years in the period ended June 30 2024 including the related notes collectively referred to as the consolidated financial statements We also have audited the Company s internal control over financial reporting as of June 30 2024 based on criteria established in
In our opinion the consolidated financial statements referred to above present fairly in all material respects the financial position of the Company as of June 30 2024 and 2023 and the results of its operations and its cash flows for each of the two years in the period ended June 30 2024 in conformity with accounting principles generally accepted in the United States of America Also in our opinion the Company maintained in all material respects effective internal control over financial reporting as of June 30 2024 based on criteria established in
The Company s management is responsible for these consolidated financial statements for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in Management s Report on Internal Control Over Financial Reporting appearing under Item 9A Our responsibility is to express opinions on the Company s consolidated financial statements and on the Company s internal control over financial reporting based on our audits We are a public accounting firm registered with the Public Company Accounting Oversight Board United States PCAOB and are required to be independent with respect to the Company in accordance with the U S federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB
We conducted our audits in accordance with the standards of the PCAOB Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement whether due to error or fraud and whether effective internal control over financial reporting was maintained in all material respects
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements whether due to error or fraud and performing procedures that respond to those risks Such procedures included examining on a test basis evidence regarding the amounts and disclosures in the consolidated financial statements Our audits also included evaluating the accounting principles used and significant estimates made by management as well as evaluating the overall presentation of the consolidated financial statements Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting assessing the risk that a material weakness exists and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk Our audits also included performing such other procedures as we considered necessary in the circumstances We believe that our audits provide a reasonable basis for our opinions
A company s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles A company s internal control over financial reporting includes those policies and procedures that i pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company ii provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company and iii provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition use or disposition of the company s assets that could have a material effect on the financial statements
Because of its inherent limitations internal control over financial reporting may not prevent or detect misstatements Also projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that i relates to accounts or disclosures that are material to the consolidated financial statements and ii involved our especially challenging subjective or complex judgments The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements taken as a whole and we are not by communicating the critical audit matter below providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates
As described in Notes 2 and 5 to the consolidated financial statements the Company s consolidated revenues for the year ended June 30 2024 were 7 7 billion The Company generally recognizes revenues over time throughout the performance period as the customer simultaneously receives and consumes the benefit provided The Company accounts for a contract when the parties have approved the contract and are committed to perform on it the rights of each party and the payment terms are identified the contract has commercial substance and collectability is probable Contract modifications are reviewed to determine whether they should be accounted for as part of the original performance obligation or as a separate contract The Company uses a variety of input and output methods that approximate the progress towards complete satisfaction of a performance obligation including costs incurred labor hours expended time elapsed measure and right to invoice practical expedient When a performance obligation has a significant degree of interrelation or interdependence between one month s deliverables and the next when there is an award or incentive fee or when there is a significant degree of customization or modification the Company generally records revenue using a percentage of completion method For these revenue arrangements substantially all revenues are recognized over time using a cost to cost input method based on the ratio of costs incurred to date to total estimated costs at completion The cost to cost input method requires the Company to use professional judgment when assessing risks estimating contract revenues and costs estimating variable consideration and making assumptions for schedule and technical issues The Company periodically reassesses its assumptions and updates its estimates as needed
The principal consideration for our determination that performing procedures relating to revenue recognized over time is a critical audit matter is a high degree of auditor effort in performing procedures related to the Company s revenue recognition
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements These procedures included testing the effectiveness of controls relating to the revenue recognition process including controls over the estimates of contract revenues and costs These procedures also included among others i obtaining and inspecting executed agreements for a selection of contracts to understand the obligations method of revenue recognition current progress towards completion and whether contract modifications are part of the original performance obligation or a separate contract ii for the contracts selected in item i evaluating the appropriateness of the over time revenue recognition input and output methods iii testing on a sample basis the completeness and accuracy of costs incurred to date iv for the contracts selected in item i where the cost to cost input method was applied a performing a retrospective comparison of incurred costs to prior costs incurred on the same contract or on similar completed contracts to evaluate the reasonableness of the total estimated costs at completion and b performing a retrospective comparison of estimated variable consideration to prior variable consideration on the same contract or on similar completed contracts to evaluate the reasonableness of the total estimated variable consideration
We have audited the accompanying consolidated statements of operations comprehensive income shareholders equity and cash flows of CACI International Inc the Company for the year ended June 30 2022 and the related notes collectively referred to as the consolidated financial statements In our opinion the consolidated financial statements present fairly in all material respects the results of the Company s operations and its cash flows for the year ended June 30 2022 in conformity with U S generally accepted accounting principles
These financial statements are the responsibility of the Company s management Our responsibility is to express an opinion on the Company s financial statements based on our audit We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U S federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB
We conducted our audit in accordance with the standards of the PCAOB Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement whether due to error or fraud Our audit included performing procedures to assess the risks of material misstatement of the financial statements whether due to error or fraud and performing procedures that respond to those risks Such procedures included examining on a test basis evidence regarding the amounts and disclosures in the financial statements Our audit also included evaluating the accounting principles used and significant estimates made by management as well as evaluating the overall presentation of the financial statements We believe that our audit provides a reasonable basis for our opinion
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that 1 relate to accounts or disclosures that are material to the financial statements and 2 involved our especially challenging subjective or complex judgments The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements taken as a whole and we are not by communicating the critical audit matters below providing separate opinions on the critical audit matters or on the account or disclosures to which they relate
As described in Notes 2 and 5 to the consolidated financial statements the Company records revenue using the percentage of completion method based on costs incurred for applicable contracts For those contracts the Company estimates variable consideration e g award or incentive fees and the estimated costs at completion EAC Changes in variable consideration and contract EACs can occur over the contract performance period for a variety of reasons including changes in contract scope and schedule and technical issues that may affect the award or incentive fee earned and total costs at completion Significant changes in estimates could have a material effect on the Company s results of operations
Auditing revenue recognition based on the percentage of completion method involved subjective auditor judgment because the Company s estimates include time and materials necessary to complete the contract and management s expectation of award and incentive fees that will be earned These estimates are based on management s assessment of the current status of the contract as well as historical results
We obtained an understanding evaluated the design and tested the operating effectiveness of controls over the Company s accounting for percentage of completion revenue recognition For example we tested controls over the determination of significant assumptions regarding award or incentive fees that will be earned future costs based on the current status of the contract and changes in EAC estimates
To test the estimate of revenue recognition based on the percentage of completion method our audit procedures included among others comparing estimates of hours and materials and award or incentive fees to historical results of similar contracts agreeing the key terms including the terms of the award and incentive fees to contract documentation and management s estimates and obtaining an understanding of contract performance through review of customer correspondence
As described in Notes 2 and 4 to the consolidated financial statements the Company completed acquisitions during the year ended June 30 2022 The Company s accounting for the acquisitions included determining the fair value of the intangible assets acquired which primarily included technology and customer relationships
Auditing the Company s accounting for certain acquired intangible assets involved subjective auditor judgment due to the significant estimation required in management s determination of the fair value of intangible assets The significant estimation was primarily due to the sensitivity of the respective fair values to underlying assumptions including discount rates projected revenue growth rates and profit margins These assumptions relate to the future performance of certain of the acquired businesses are forward looking and could be affected by future economic and market conditions
We obtained an understanding evaluated the design and tested the operating effectiveness of controls over the Company s process for accounting for certain acquired intangible assets For example we tested controls over management s review of the valuation of intangible assets including the review of the valuation model and significant assumptions used in the valuation
To test the fair value of these certain acquired intangible assets our audit procedures included among others evaluating the Company s use of valuation methodologies evaluating the prospective financial information and testing the completeness and accuracy of underlying data We involved our valuation specialists to assist in testing the significant assumptions used to value the certain acquired intangible assets For example we compared the significant assumptions to current industry market and economic trends historical results of the acquired business and to other relevant factors We also performed sensitivity analyses of the significant assumptions to evaluate the change in the fair value resulting from changes in the assumptions
CACI International Inc collectively with its consolidated subsidiaries CACI the Company we us and our is a leading provider of Expertise and Technology to customers in support of national security in the intelligence defense and federal civilian sectors both domestically and internationally CACI s customers include agencies and departments of the U S government various state and local government agencies foreign governments and commercial enterprises We operate in two reportable segments Domestic Operations and International Operations
The accompanying consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission SEC and include the assets liabilities results of operations and cash flows for the Company including its subsidiaries and ventures that are majority owned or otherwise controlled by the Company All intercompany balances and transactions have been eliminated in consolidation Certain prior year amounts have been reclassified to conform to the current year presentation
The preparation of financial statements in conformity with generally accepted accounting principles in the United States GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported periods The most significant of these estimates and assumptions relate to estimating contract revenues and costs measuring progress against the Company s performance obligations assessing the fair value of acquired assets and liabilities accounted for through business acquisitions valuing and determining the amortization periods for long lived intangible assets assessing the recoverability of long lived assets reserves for accounts receivable and reserves for contract related matters Management evaluates its estimates on an ongoing basis using the most current and available information However actual results may differ significantly from estimates Changes in estimates are recorded in the period in which they become known
The Company records all tangible and intangible assets acquired and liabilities assumed in a business combination at fair value as of the acquisition date with any excess purchase consideration recorded as goodwill Determining the fair value of acquired assets and liabilities assumed including intangible assets requires management to make significant judgments about expected future cash flows weighted average cost of capital discount rates and expected long term growth rates During the measurement period not to exceed one year from the acquisition date the Company may adjust provisional amounts recorded to reflect new information subsequently obtained regarding facts and circumstances that existed as of the acquisition date
The Company generates almost all of our revenues from three different types of contractual arrangements with the U S government cost plus fee fixed price and time and materials contracts Our contracts with the U S government are generally subject to the Federal Acquisition Regulation FAR and are competitively priced based on estimated costs of providing the contractual goods or services
We account for a contract when the parties have approved the contract and are committed to perform on it the rights of each party and the payment terms are identified the contract has commercial substance and collectability is probable
At contract inception the Company determines whether the goods or services to be provided are to be accounted for as a single performance obligation or as multiple performance obligations This evaluation requires professional judgment and it may impact the timing and pattern of revenue recognition If multiple performance obligations are identified we generally use the cost plus a margin approach to determine the relative standalone selling price of each performance obligation
When determining the total transaction price the Company identifies both fixed and variable consideration elements within the contract Variable consideration includes any amount within the transaction price that is not fixed such as award or incentive fees performance penalties unfunded contract value or other similar items For our contracts with award or incentive fees the Company estimates the total amount of award or incentive fee expected to be recognized into revenues Throughout the performance period we recognize as revenue a constrained amount of variable consideration only to the extent that it is probable that a significant reversal of the cumulative amount recognized to date will not be required in a subsequent period Our estimate of variable consideration is periodically adjusted based on significant changes in relevant facts and circumstances In the period in which we can calculate the final amount of award or incentive fee earned based on the receipt of the customer s final performance score or determining that more objective contractually defined criteria have been fully satisfied the Company will adjust our cumulative revenue recognized to date on the contract
We generally recognize revenues over time throughout the performance period as the customer simultaneously receives and consumes the benefits provided on our services type revenue arrangements This continuous transfer of control for our U S government contracts is supported by the unilateral right of our customer to terminate the contract for a variety of reasons without having to provide justification for its decision For our services type revenue arrangements in which there are a repetitive amount of services that are substantially the same from one month to the next the Company applies the series guidance We use a variety of input and output methods that approximate the progress towards complete satisfaction of the performance obligation including costs incurred labor hours expended and time elapsed measures for our fixed price stand ready obligations For certain contracts primarily our cost plus and time and materials services type revenue arrangements we apply the right to invoice practical expedient in which revenues are recognized in direct proportion to our present right to consideration for progress towards the complete satisfaction of the performance obligation
When a performance obligation has a significant degree of interrelation or interdependence between one month s deliverables and the next when there is an award or incentive fee or when there is a significant degree of customization or modification the Company generally records revenue using a percentage of completion method For these revenue arrangements substantially all revenues are recognized over time using a cost to cost input method based on the ratio of costs incurred to date to total estimated costs at completion When estimates of total costs to be incurred on a contract exceed total revenue a provision for the entire loss on the contract is recorded in the period in which the loss is determined
Contract modifications are reviewed to determine whether they should be accounted for as part of the original performance obligation or as a separate contract When a contract modification changes the scope or price and the additional performance obligations are at their standalone selling price the original contract is terminated and the Company accounts for the change prospectively when the new goods or services to be transferred are distinct from those already provided When the contract modification includes goods or services that are not distinct from those already provided the Company records a cumulative adjustment to revenues based on a remeasurement of progress towards the complete satisfaction of the not yet fully delivered performance obligation
Based on the critical nature of our contractual performance obligations the Company may proceed with work based on customer direction prior to the completion and signing of formal contract documents The Company has a formal review process for approving any such work that considers previous experiences with the customer communications with the customer regarding funding status and our knowledge of available funding for the contract or program
Costs of revenues includes all direct contract costs such as labor materials subcontractor costs and indirect costs that are allowable and allocable to contracts under federal procurement standards Costs of revenues also includes expenses that are unallowable under applicable procurement standards and are not allocable to contracts for billing purposes Such unallowable expenses do not directly generate revenues but are necessary for business operations
The Company recognizes revenues on many of its fixed price award fee and incentive fee arrangements over time primarily using a cost to cost input method based on the ratio of costs incurred to date to total estimated costs at completion The process requires the Company to use professional judgment when assessing risks estimating contract revenues and costs estimating variable consideration and making assumptions for schedule and technical issues The Company periodically reassesses its assumptions and updates its estimates as needed When estimates of total costs to be incurred on a contract exceed total revenues a provision for the entire loss on the contract is recorded in the period in which the loss is determined
In addition the costs to fulfill and obtain a contract are considered for capitalization based on contract specific facts and circumstances The incremental costs to fulfill a contract e g ramp up costs at the beginning of the period of performance may be capitalized when expenses are incurred prior to satisfying a performance obligation The incremental costs of obtaining a contract e g sales commissions are capitalized as an asset when the Company expects to recover them either directly or indirectly through the revenue arrangement s profit margins These capitalized costs are subsequently expensed over the revenue arrangement s period of performance The Company has elected to apply the practical expedient to immediately expense the costs to obtain a contract when the performance obligation will be completed within twelve months of contract inception
Contract liabilities primarily include advance payments received from a customer in excess of revenues that may be recognized as of the balance sheet date The advance payment is subsequently recognized into revenues as the performance obligation is satisfied
Remaining performance obligations RPO represent the expected revenues to be recognized for the satisfaction of remaining performance obligations on existing contracts This balance excludes unexercised contract option years and task orders that may be issued underneath an Indefinite Delivery Indefinite Quantity IDIQ vehicle until such task orders are awarded The RPO balance generally increases with the execution of new contracts and converts into revenues as contractual performance obligations are satisfied The Company continues to monitor this balance as it is subject to change from execution of new contracts contract modifications or extensions government deobligations or early terminations
The Company considers all investments with an original maturity of three months or less on their trade date to be cash equivalents The Company classifies investments with an original maturity of more than three months but less than twelve months on their trade date as short term marketable securities
Receivables include billed and billable receivables and unbilled receivables Amounts billable and unbilled receivables are recognized at estimated realizable value and consist of costs and fees substantially all of which are expected to be billed and collected generally within one year When events or conditions indicate that amounts outstanding from customers may become uncollectible an allowance is estimated and recorded Upon determination that a specific receivable is uncollectible the receivable is written off against the allowance for expected credit losses The Company s allowance for expected credit losses was 6 1 million and 7 0 million at June 30 2024 and June 30 2023 respectively
Financial instruments that potentially subject the Company to credit risk include accounts receivable and cash equivalents Management believes that credit risk related to the Company s accounts receivable is limited due to a large number of customers in differing segments and agencies of the U S government Accounts receivable credit risk is also limited due to the credit worthiness of the U S government Management believes the credit risk associated with the Company s cash equivalents is limited due to the credit worthiness of the obligors of the investments underlying the cash equivalents In addition although the Company maintains cash balances at financial institutions that exceed federally insured limits these balances are placed with high quality financial institutions
Inventories are stated at the lower of cost average cost or first in first out or net realizable value and are included in prepaid expenses and other current assets on the accompanying consolidated balance sheets The Company periodically assesses its current inventory balances and records a provision for damaged deteriorated or obsolete inventory based on historical patterns and forecasted sales
Goodwill represents the excess of the fair value of consideration paid for an acquisition over the fair value of the net assets acquired and liabilities assumed as of the acquisition date The Company evaluates goodwill for both of its reporting units for impairment at least annually on the first day of the fiscal fourth quarter or whenever events or circumstances indicate that the carrying value may not be recoverable The evaluation includes a qualitative assessment or a quantitative assessment that compares the fair value of the relevant reporting unit to its respective carrying value including goodwill and utilizes both income and market approaches The analysis relies on significant judgements and assumptions about expected future cash flows weighted average cost of capital discount rates expected long term growth rates and financial measures derived from observable market data of comparable public companies
Intangible assets with finite lives are amortized using the method that best reflects how their economic benefits are utilized or if a pattern of economic benefits cannot be reliably determined on a straight line basis over their estimated useful lives which is generally over periods ranging from one to twenty years Intangible assets with finite lives are assessed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable
Purchases of property plant and equipment are capitalized at cost Depreciation of equipment and furniture has been provided over the estimated useful life of the respective assets ranging from three to eight years using the straight line method Leasehold improvements are generally amortized using the straight line method over the remaining lease term or the useful life of the improvements whichever is shorter Repairs and maintenance costs are expensed as incurred
We evaluate our long lived assets for potential impairment whenever there is evidence that events or changes in circumstances indicate that the carrying value may not be recoverable and the carrying amount of the asset exceeds its estimated fair value
Costs incurred in creating software to be sold or licensed for external use are expensed as incurred until technological feasibility has been established Technological feasibility is established upon completion of a detailed program design or in its absence completion of a working model Thereafter all such software development costs are capitalized and subsequently reported at the lower of unamortized cost or estimated net realizable value Capitalized costs are amortized on a straight line basis over the remaining estimated economic life of the software
The Company enters into contractual arrangements primarily for the use of real estate facilities information technology equipment and certain other equipment These arrangements contain a lease when the Company controls the underlying asset and has the right to obtain substantially all of the economic benefits or outputs from the asset All of our leases are operating leases
The Company records a right of use ROU asset and lease liability as of the lease commencement date equal to the present value of the remaining lease payments Most of our leases do not provide an implicit rate that can be readily determined Therefore we use a discount rate based on the Company s incremental borrowing rate which is determined using our credit rating and information available as of the commencement date The ROU asset is then adjusted for initial direct costs and certain lease incentives included in the contractual arrangement The Company has elected to not apply the lease recognition guidance for short term equipment leases and to separate lease from non lease components Our operating lease arrangements may contain options to extend the lease term or for early termination We account for these options when it is reasonably certain we will exercise them ROU assets are evaluated for impairment in a manner consistent with the treatment of other long lived assets
Operating lease expense is recognized on a straight line basis over the lease term and is recorded primarily within indirect costs and selling expenses on the consolidated statement of operations Variable lease expenses are generally recorded in the period they are incurred and are excluded from the ROU asset and lease liability
The carrying amounts of cash and cash equivalents accounts receivable accounts payable and amounts included in other current assets and current liabilities that meet the definition of a financial instrument approximate fair value because of the short term nature of these amounts
The fair value of the Company s debt under its bank credit facility approximates its carrying value at June 30 2024 The fair value of the Company s debt under its bank credit facility was estimated using Level 2 inputs based on market data on companies with a corporate rating similar to CACI s that have recently priced credit facilities
Basic earnings per share excludes dilution and is computed by dividing income by the weighted average number of common shares outstanding for the period Diluted earnings per share reflects potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock but not securities that are anti dilutive Using the treasury stock method diluted earnings per share includes the incremental effect of restricted stock units RSUs that are no longer subject to a market or performance condition Information about the weighted average number of basic and diluted shares is presented in Note 14 Earnings Per Share
Income taxes are accounted for using the asset and liability method which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled The effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income in the period that includes the enactment date Estimates of the realizability of deferred tax assets are based on the scheduled reversal of deferred tax liabilities projected future taxable income and tax planning strategies
Liabilities for uncertain tax positions are recognized when it is more likely than not that a tax position will not be sustained upon examination and settlement with taxing authorities Liabilities for uncertain tax positions are measured based upon the largest amount of benefit that is greater than 50 likely of being realized upon ultimate settlement Tax penalties and interest are included in income tax expense
The Company maintains the CACI International Inc Group Executive Retirement Plan the Supplemental Savings Plan and maintains the underlying assets in a Rabbi Trust The Supplemental Savings Plan is a non qualified defined contribution supplemental retirement savings plan for certain key employees whereby participants may elect to defer and contribute a portion of their compensation as permitted by the plan Each participant directs his or her investments in the Supplemental Savings Plan see Note 17 Retirement Plans
A Rabbi Trust is a grantor trust established to fund compensation for a select group of management The assets of this trust are available to satisfy the claims of general creditors in the event of bankruptcy of the Company The assets held by the Rabbi Trust are invested in corporate owned life insurance COLI products The COLI products are recorded at cash surrender value in the consolidated financial statements as supplemental retirement savings plan assets The amounts due to participants are based on contributions participant investment elections and other participant activity and are recorded as supplemental retirement savings plan obligations
The assets and liabilities of the Company s foreign subsidiaries whose functional currency is other than the U S dollar are translated at the exchange rate in effect on the reporting date and income and expenses are translated at the weighted average exchange rate during the period The Company s primary practice is to negotiate contracts in the same currency in which the predominant expenses are incurred thereby mitigating the exposure to foreign currency fluctuations The net translation gains and losses are recorded as accumulated other comprehensive income loss in shareholders equity Foreign currency transaction gains and losses are recorded as incurred in indirect costs and selling expenses in the accompanying consolidated statements of operations
Comprehensive income is the change in equity of a business enterprise during a period from transactions and other events and circumstances from non owner sources Other comprehensive income loss refers to revenue expenses and gains and losses that under U S GAAP are included in comprehensive income but excluded from the determination of net income The elements within other comprehensive income consist of foreign currency translation adjustments the changes in the fair value of interest rate swap agreements net of tax benefit expense of 2 5 million 6 1 million and 11 8 million for the years ended June 30 2024 2023 and 2022 respectively and differences between actual amounts and estimates based on actuarial assumptions and the effect of changes in actuarial assumptions made under the Company s post retirement benefit plans net of tax see Note 13
As of June 30 2024 2023 and 2022 the accumulated other comprehensive loss balance included gains losses of 37 4 million 37 0 million and 45 3 million respectively related to foreign currency translation adjustments 23 4 million 30 9 million and 13 1 million respectively related to the fair value of interest rate swap agreements and 1 3 million 1 1 million and 1 1 million respectively related to unrecognized post retirement costs
Liabilities for loss contingencies arising from claims assessments litigation fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and or remediation can be reasonably estimated
which requires disclosure of significant segment expenses and other segment items in annual and interim periods ASU 2023 07 is effective for fiscal years beginning after December 15 2023 and interim periods within fiscal years beginning after December 15 2024 and requires retrospective application to all prior periods presented in the financial statements We are currently evaluating the impacts of the new standard
which requires disaggregated information about an entity s effective tax rate reconciliation as well as information on income taxes paid ASU 2023 09 is effective for fiscal years beginning after December 15 2024 and should be applied prospectively Retrospective application is permitted We are currently evaluating the impacts of the new standard
During fiscal 2024 the Company completed three acquisitions that enhance our capabilities and or customer relationships The aggregate purchase consideration was approximately 108 6 million net of cash acquired which includes initial cash payments deferred consideration and estimated contingent consideration The Company preliminarily recognized fair values of the assets acquired and liabilities assumed and allocated 70 0 million to goodwill and 40 1 million to intangible assets At June 30 2024 the Company had not finalized the determination of fair values allocated to assets and liabilities
During fiscal 2023 CACI Limited completed the acquisition of a business in the United Kingdom that provides software engineering data analysis and cyber services to the national security sector The purchase consideration was approximately 15 4 million net of cash acquired The Company recognized fair values of the assets acquired and liabilities assumed and allocated 14 9 million to goodwill and 2 0 million to intangible assets
During fiscal 2022 CACI completed four acquisitions that provide technology to sensitive government customers Their capabilities include open source intelligence solutions specialized cyber satellite communications multi domain photonics technologies for free space optical communications and commercial solutions for classified security technologies The aggregate purchase consideration was approximately 616 6 million The Company recognized fair values of the assets acquired and liabilities assumed and allocated 450 5 million to goodwill largely attributable to intellectual capital and the acquired assembled workforces and 180 6 million to intangible assets The intangible assets consist of customer relationships of 98 4 million and technology of 82 2 million The fair value attributed to intangible assets is being amortized on an accelerated basis over a range of approximately 15 to 20 years for customer relationships and over a range of approximately 5 to 10 years for technology The fair value attributed to the intangible assets acquired was based on assumptions and other information compiled by management including independent valuations that utilized established valuation techniques Of the value attributed to goodwill and intangible assets approximately 493 2 million is deductible for income tax purposes
The Company disaggregates revenues by contract type customer type prime vs subcontractor and whether the solution provided is primarily Expertise or Technology These categories represent how the nature amount timing and uncertainty of revenues and cash flows are affected
Aggregate net changes in estimates reflected an increase to income before income taxes of 25 0 million 0 83 per diluted share an increase of 23 4 million 0 74 per diluted share and an increase of 29 8 million 0 93 per diluted share during fiscal 2024 2023 and 2022 respectively The Company uses its statutory tax rate when calculating the impact to diluted earnings per share
Revenues recognized from previously satisfied performance obligations were 0 7 million for fiscal 2024 1 7 million for fiscal 2023 and nominal for fiscal 2022 The change in revenues generally relates to final true up adjustments for estimated award or incentive fees in the period in which the customer s final performance score was received or when it can
As of June 30 2024 the Company had 10 3 billion of remaining performance obligations and expects to recognize approximately 47 and 69 over the next 12 and 24 months respectively with the remainder to be recognized thereafter
On December 20 2023 the Company amended its Master Accounts Receivable Purchase Agreement MARPA with MUFG Bank Ltd Purchaser for the sale of certain designated eligible U S government receivables The amendment extended the term of the MARPA to December 20 2024 Under the MARPA the Company can sell eligible receivables including certain billed and unbilled receivables up to a maximum amount of 250 0 million The Company s receivables are sold under the MARPA without recourse for any U S government credit risk
The Company does not retain an ongoing financial interest in the transferred receivables other than cash collection and administrative services The Company estimated that its servicing fee was at fair value and therefore no servicing asset or liability related to these receivables was recognized as of June 30 2024 Proceeds from the sold receivables are reflected in our operating cash flows on the statement of cash flows
During fiscal 2024 and 2023 the Company recorded a net cash inflow in its cash flows from operating activities of 50 0 million and a net cash inflow of 42 2 million respectively from sold receivables MARPA cash flows are calculated as the change in the outstanding balance during the fiscal year
Includes the cash collected on behalf of but not yet remitted to Purchaser as of June 30 2024 and 2023 This balance is included in other accrued expenses and current liabilities as of the balance sheet date
1 Includes goodwill initially allocated to new business combinations as well as measurement period adjustments when applicable The final purchase price allocations for our fiscal 2024 acquisitions remain open as of June 30 2024
Amortization expense related to intangible assets was 73 8 million 75 4 million and 74 1 million for fiscal 2024 2023 and 2022 respectively Intangible assets with a gross carrying value of 6 1 million became fully amortized during fiscal 2024 and are no longer reflected in the gross carrying value and accumulated amortization as of June 30 2024
All of the Company s leases are operating leases The current portion of operating lease liabilities is included in other accrued expenses and current liabilities in our consolidated balance sheets Lease balances in our consolidated balance sheet are as follows in thousands
Cash paid for operating leases was 88 0 million 86 1 million and 85 2 million in fiscal 2024 2023 and 2022 respectively Operating lease liabilities arising from obtaining new ROU assets was 61 3 million 64 5 million and 30 9 million in fiscal 2024 2023 and 2022 respectively which includes all noncash changes arising from new or remeasured operating lease arrangements
The Company s financial assets and liabilities recorded at fair value on a recurring basis are categorized based on the priority of the inputs used to measure fair value The inputs used in measuring fair value are categorized into three levels as follows
Level 2 Inputs unadjusted quoted prices for similar assets and liabilities in active markets quoted prices for identical or similar assets and liabilities in markets that are not active inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data
Level 3 Inputs amounts derived from valuation models in which unobservable inputs reflect the reporting entity s own assumptions about the assumptions of market participants that would be used in pricing the asset or liability
The Company uses interest rate swap agreements to manage its interest rate risk The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative This analysis reflects the contractual terms of the derivatives including the period to maturity and uses observable market based inputs including interest rate curves The Company also incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty s nonperformance risk in the fair value measurements Changes in the fair value of the interest rate swap agreements are recorded as a component of accumulated other comprehensive income or loss
The Company recognized contingent consideration liabilities in connection with its current year acquisitions representing potential earnout payments and other contingent payments The fair values of these liabilities were determined using a valuation model which included an assessment of the most likely outcome assumptions related to projected earnings of the acquired company and the application of a discount rate when applicable Fair value of contingent consideration is reassessed quarterly including an analysis of the significant inputs used in the evaluation as well as the accretion of the discount Changes are reflected within indirect costs and selling expenses
The Company has a 3 200 0 million credit facility the Credit Facility which consists of a 1 975 0 million revolving credit facility the Revolving Facility and a 1 225 0 million term loan the Term Loan The Revolving Facility has sub facilities of 100 0 million for same day swing line loan borrowings and 25 0 million for stand by letters of credit At any time and so long as no default has occurred the Company has the right to increase the Revolving Facility or the Term Loan in an aggregate principal amount of up to the greater of 500 0 million and 75 of the Company s EBITDA plus an unlimited amount of indebtedness subject to 3 75 times calculated assuming the Revolving Facility is fully drawn with applicable lender approvals The Credit Facility is available to refinance existing indebtedness and for general corporate purposes including working capital expenses and capital expenditures
The Revolving Facility is a secured facility that permits continuously renewable borrowings of up to 1 975 0 million As of June 30 2024 the Company had 415 0 million outstanding under the Revolving Facility and no borrowings on the swing line The Company pays a quarterly facility fee for the unused portion of the Revolving Facility
The Term Loan is a five year secured facility under which principal payments are due in quarterly installments of 7 7 million through December 31 2023 and 15 3 million thereafter until the balance is due in full on December 13 2026 As of June 30 2024 the Company had 1 133 1 million outstanding under the Term Loan
The interest rates applicable to loans under the Credit Facility are floating interest rates that at the Company s option equal a base rate or a SOFR rate plus in each case an applicable margin based upon the Company s consolidated total net leverage ratio As of June 30 2024 the effective interest rate including the impact of the Company s floating to fixed interest rate swap agreements and excluding the effect of amortization of debt financing costs for the outstanding borrowings under the Credit Facility was 4 59
The Credit Facility requires the Company to comply with certain financial covenants including a maximum total leverage ratio and a minimum interest coverage ratio The Credit Facility also includes customary negative covenants restricting or limiting the Company s ability to guarantee or incur additional indebtedness grant liens or other security interests to third parties make loans or investments transfer assets declare dividends or redeem or repurchase capital stock or make other distributions prepay subordinated indebtedness and engage in mergers acquisitions or other business combinations in each case except as expressly permitted under the Credit Facility As of June 30 2024 the Company was in compliance with all of the financial covenants A majority of the Company s assets serve as collateral under the Credit Facility
The Company periodically uses derivative financial instruments as part of a strategy to manage exposure to market risks associated with interest rate fluctuations The Company has entered into several floating to fixed interest rate swap agreements for an aggregate notional amount of 1 100 0 million which hedge a portion of the Company s floating rate indebtedness The swaps mature at various dates through 2028 The Company has designated the swaps as cash flow hedges Unrealized gains are recognized as assets while unrealized losses are recognized as liabilities The interest rate swap agreements are highly correlated to the changes in interest rates to which the Company is exposed Realized gains and losses in connection with each required interest payment are reclassified from accumulated other comprehensive income or loss to interest expense The Company does not hold or issue derivative financial instruments for trading purposes
Accrued post retirement obligations include projected liabilities for benefits the Company is obligated to provide under long term care group health and executive life insurance plans each of which is unfunded Plan benefits are provided to certain current and former executives their dependents and other eligible employees as defined Post retirement obligations also include accrued benefits under supplemental retirement benefit plans covering certain executives The expense recorded under these plans was 0 3 million 0 7 million and 1 3 million during fiscal 2024 2023 and 2022 respectively
On January 30 2023 CACI entered into an Accelerated Share Repurchase ASR Agreement with Citibank N A Citibank Under the ASR Agreement we paid 250 0 million to Citibank and received an initial delivery of approximately 0 7 million shares of our common stock which became treasury shares On August 4 2023 the ASR was completed and an additional 0 1 million shares of common stock were received which became treasury shares In total 0 8 million shares were repurchased at an average price per share of 303 57
In addition to the ASR during fiscal 2024 CACI repurchased 0 5 million shares of its outstanding common stock for 150 0 million on the open market at an average share price of 318 99 including commissions paid The total remaining authorization for future common share repurchases under the 2023 Repurchase Program was 337 3 million as of June 30 2024
Stock based compensation is recognized in our consolidated statement of operations based on grant date fair values The Company generally issues stock based compensation awards in the form of non performance based restricted stock units RSUs and performance based RSUs PRSUs Some of our performance based awards have market conditions The fair value of RSU and PRSU awards is determined based on the Company s common stock closing price on the date of grant The fair value of PRSUs that also have market conditions is measured using a binomial lattice model
Stock based compensation expense is recognized on a straight line basis ratably over the requisite service period which is generally the vesting period unless otherwise specifically noted PRSUs are subject to achievement of performance conditions in addition to grantee service Stock based compensation expense for PRSUs with market conditions is recognized on an accelerated basis The Company recognizes the effect of expected forfeitures of equity grants by estimating an expected forfeiture rate for grants of equity instruments Amounts recognized for expected forfeitures are subsequently adjusted periodically and at major vesting dates to reflect actual forfeitures
As of June 30 2024 the Company had stock based compensation awards outstanding under its 2016 Amended and Restated Incentive Compensation Plan the 2016 Plan and its Management Stock Purchase Plan MSPP Stock based compensation expense and related income tax benefits recognized under all plans is as follows in thousands
During fiscal 2024 2023 and 2022 the Company recognized 2 9 million 1 1 million and 5 2 million of excess tax benefits respectively which have been reported as operating cash inflows in the accompanying consolidated statements of cash flows
Under the terms of the 2016 Plan the Company may issue among others non qualified stock options restricted stock RSUs SARs and performance awards collectively referred to herein as equity awards During the periods presented all equity awards issued were in the form of RSUs including performance based and non performance based RSUs
The Company fulfills its obligations under the equity awards by either issuing new shares of authorized common stock or by issuing shares from treasury The total number of shares authorized by shareholders for grants under the 2016 Plan was 2 400 000 The aggregate number of grants that may be made may exceed this approved amount as forfeited awards become available for future grants As of June 30 2024 cumulative grants of 1 681 869 equity awards underlying the shares authorized have been issued and 298 988 have been forfeited
Annual grants under the 2016 Plan are generally made to the Company s key employees and to members of the Company s Board of Directors during the second quarter of the Company s fiscal year Annual grants consist of PRSUs and RSUs With the approval of its Chief Executive Officer the Company also issues equity awards to strategic new hires and to employees who have demonstrated superior performance Performance based stock awards vest and the stock is issued at the end of the performance period based upon the achievement of specific performance criteria Non performance based awards generally vest over a period of 3 years based upon required service
For annual performance based stock awards granted to key employees in fiscal 2024 2023 and 2022 the awards vest at the end of a three year period subject to continuous service with the final number of PRSUs earned by participants based on the extent of achievement of a specified cumulative three year EBITDA objective with minimum required performance
For annual performance based stock awards granted to key employees in fiscal 2021 50 of the award vests three years from the grant date and 50 vests four years from the grant date with the final number of PRSUs earned by participants based on the achievement of an EPS target in the first year of the grant and on the average share price for the 90 day periods ended for the following three years Depending on the degree that the 90 day average share price of the Company s stock in years one two and three exceeds the 90 day average share price at the grant date the number of shares ultimately awarded could range up to 200 of the specified target award
The Company adopted the 2002 Employee Stock Purchase Plan ESPP MSPP and DSPP in November 2002 and implemented these plans beginning July 1 2003 There are 1 500 000 500 000 and 75 000 shares authorized for grants under the ESPP MSPP and DSPP respectively
The ESPP allows eligible full time employees to purchase shares of common stock at 95 of the fair market value of a share of common stock on the last day of the quarter The maximum number of shares that an eligible employee can purchase during any quarter is equal to two times an amount determined as follows 20 of such employee s compensation over the quarter divided by 95 of the fair market value of a share of common stock on the last day of the quarter The ESPP is a qualified plan under Section 423 of the Internal Revenue Code and for financial reporting purposes was amended effective July 1 2005 so as to be considered non compensatory Accordingly there is no stock based compensation expense associated with shares acquired under the ESPP As of June 30 2024 participants have purchased 1 363 567 shares under the ESPP at a weighted average price per share of 83 16 Of these shares 33 406 were purchased by employees at a weighted average price per share of 321 68 during fiscal 2024 During the year ended June 30 2013 the Company established a 10b5 1 plan to facilitate the open market purchase of shares of Company stock to satisfy its obligations under the ESPP
The MSPP provides those senior executives with stock holding requirements a mechanism to receive RSUs in lieu of up to 100 of their annual bonus For the fiscal 2024 2023 and 2022 RSUs awarded in lieu of bonuses earned were granted at 100 of the closing price of a share of the Company s common stock on the date of the award as reported by the New York Stock Exchange RSUs granted under the MSPP vest at the earlier of 1 three years from the grant date 2 upon a change of control of the Company 3 upon a participant s retirement at or after age 65 or 4 upon a participant s death or permanent disability Vested RSUs are settled in shares of common stock The Company recognizes the value of the discount applied to RSUs granted under the MSPP as stock compensation expense ratably over the three year vesting period
The DSPP allows members of the Company s Board of Directors to elect to receive RSUs at the market price of the Company s common stock on the date of the award in lieu of up to 100 of their annual retainer fees Vested RSUs are settled in shares of common stock There were no DSPP awards outstanding during fiscal 2024
imarily by federal research tax credits and the remeasurement of state deferred taxes The effective tax rate for fiscal 2022 was favorably impacted primarily by the Company s method of accounting changes that resulted in a carryback of a federal income NOL and related income tax benefit as well as federal research tax credits
During fiscal 2023 a provision of the TCJA went into effect that eliminated the option to deduct domestic research and development costs in the year incurred and instead requires taxpayers to capitalize and amortize such costs over five years This provision decreased fiscal 2024 and 2023 cash flows from operations by 73 9 million and 95 0 million respectively and increased net deferred tax assets by a similar amount The future impact of this provision will depend on any guidance issued by the Treasury Department regarding the identification of appropriate costs for capitalization and the amount of future research and development expenses paid or incurred among other factors
The Company is subject to income taxes in the U S and various state and foreign jurisdictions Tax statutes and regulations within each jurisdiction are subject to interpretation and require the application of significant judgment The Company is currently under examination by the Internal Revenue Service IRS for fiscal 2017 through 2021 and one state jurisdiction for fiscal 2019 and 2020 Based on the current IRS audit status and expected conclusion timing approximately 76 7 million of federal income tax receivables have been classified as long term as of June 30 2024 The Company does not expect the resolution of these examinations to have a material impact on its results of operations financial condition or cash flows
U S income taxes have not been provided for undistributed earnings of foreign subsidiaries that have been permanently reinvested outside the United States As of June 30 2024 the estimated deferred tax liability associated with these undistributed earnings is approximately 2 9 million
The Company s total liability for unrecognized tax benefits as of June 30 2024 2023 and 2022 was approximately 73 0 million 153 9 million and 42 8 million respectively During fiscal 2023 the Company recognized an increase in reserves related to the required capitalization of research and development expenses which became effective in fiscal 2023 and current and prior year research and development tax credits During fiscal 2024 the Company reduced its unrecognized tax benefit primarily due to completing a detailed analysis of capitalized research and development costs which considered recent guidance issued by the IRS
The Company recognizes net interest and penalties as a component of income tax expense Over the next 12 months the Company does not expect a significant increase or decrease in the unrecognized tax benefits recorded at June 30 2024 As of June 30 2024 the entire balance of unrecognized tax benefits is included in deferred taxes and other long term liabilities
The Company sponsors various defined contribution plans in which most employees are eligible to participate Company contribution expense for fiscal 2024 2023 and 2022 was 78 7 million 99 0 million and 100 3 million respectively
The Company maintains the Supplemental Savings Plan through which on a calendar year basis officers at the director level and above can elect to defer for contribution to the Supplemental Savings Plan up to 50 of their base compensation and up to 100 of their bonuses The Company provides a contribution of 5 of compensation for each participant s compensation that exceeds the limit as set forth in IRC 401 a 17 currently 345 000 per year The Company also has the option to make annual discretionary contributions Company contributions vest five years from the date of enrollment and vesting is accelerated in the event of a change of control of the Company Participant deferrals and Company contributions will be credited with the rate of return based on the investment options and asset allocations selected by the Participant Participants may change their asset allocation as often as daily if they so choose A Rabbi Trust has been established to hold and provide a measure of security for the investments that finance benefit payments Distributions from the Supplemental Savings Plan are made upon retirement termination death or total disability The Supplemental Savings Plan also allows for in service distributions
Supplemental Savings Plan obligations due to participants totaled 122 5 million at June 30 2024 of which 11 3 million is included in accrued compensation and benefits in the accompanying consolidated balance sheet Supplemental Savings Plan obligations increased by 8 1 million during fiscal 2024 consisting of 12 6 million of distributions and 6 0 million of investment gains offset by 13 9 million of participant compensation deferrals and 1 0 million of Company contributions
The Company maintains COLI assets in a Rabbi Trust to offset the obligations under the Supplemental Savings Plan The value of the COLI in the Rabbi Trust was 99 4 million at June 30 2024 and COLI gains were 5 2 million for fiscal 2024
The Company reports operating results and financial data in two segments domestic operations and international operations Domestic operations provide Expertise and Technology primarily to U S federal government agencies International operations provide Expertise and Technology primarily to international government and commercial customers
The Company is involved in various lawsuits claims and administrative proceedings arising in the normal course of business Management is of the opinion that any liability or loss associated with such matters either individually or in the aggregate will not have a material adverse effect on the Company s operations and liquidity
Payments to the Company on cost plus fee and time and materials contracts are subject to adjustment upon audit by the Defense Contract Audit Agency DCAA and other government agencies that do not utilize DCAA s services The DCAA has completed audits of the Company s annual incurred cost proposals through fiscal year ended June 30 2022 We are still negotiating the results of prior years audits with the respective cognizant contracting officers and believe our reserves for such are adequate In the opinion of management adjustments that may result from these audits and the audits not yet started are not expected to have a material effect on the Company s financial position results of operations or cash flows as the Company has accrued its best estimate of potential disallowances Additionally the DCAA continually reviews the cost accounting and other practices of government contractors including the Company In the course of those reviews cost accounting and other issues are identified discussed and settled
We maintain disclosure controls and procedures as defined in the Exchange Act Rules 13a 15 e and 15d 15 e that are designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded processed summarized and reported within the time periods specified in the SEC s rules and forms Our disclosure controls and procedures are also designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management including our Chief Executive Officer CEO and Chief Financial Officer CFO as appropriate to allow timely decisions regarding required disclosure
The effectiveness of a system of disclosure controls and procedures is subject to various inherent limitations including cost limitations judgments used in decision making assumptions about the likelihood of future events the soundness of internal controls and fraud Due to such inherent limitations there can be only reasonable and not absolute assurance that any system of disclosure controls and procedures will be successful in detecting or preventing all errors or fraud or in making all material information known in a timely manner to the appropriate levels of management
We performed an evaluation of the effectiveness of our disclosure controls and procedures under the supervision of the CEO and CFO as of June 30 2024 Based on the evaluation our management including the CEO and CFO concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of June 30 2024
Under the supervision and with the participation of our management an evaluation was also performed of any changes in our internal control over financial reporting that occurred during our last fiscal quarter ended June 30 2024 Based on this evaluation management determined there were no changes in our internal control over financial reporting that occurred during our last fiscal quarter that have materially affected or are reasonably likely to materially affect our internal control over financial reporting
The management of CACI International Inc is responsible for establishing and maintaining adequate internal control over financial reporting and for assessing the effectiveness of internal control over financial reporting Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the issuer are being made only in accordance with authorizations of management and directors of the issuer and
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition use or disposition of the issuer s assets that could have a material effect on the financial statements
Because of its inherent limitations internal control over financial reporting may not prevent or detect misstatements Also projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate
The Company s management with the participation of its CEO and CFO conducted an evaluation of the effectiveness of CACI International Inc s internal control over financial reporting based on the framework and criteria established in
issued by the Committee of Sponsoring Organizations of the Treadway Commission COSO Based on this evaluation our management has concluded that CACI International Inc s internal control over financial reporting was effective as of June 30 2024
The effectiveness of the Company s internal control over financial reporting as of June 30 2024 has been audited by PricewaterhouseCoopers LLP an independent registered public accounting firm as stated in their report which appears under Item 8
During the fiscal quarter ended June 30 2024 the following directors or officers adopted or terminated a Rule 10b5 1 trading arrangement or non Rule 10b5 1 trading arrangement as those terms are defined in Regulation S K Item 408
John S Mengucci our Chief Executive Officer adopted a new Rule 10b5 1 trading arrangement on May 17 2024 that will terminate no later than November 22 2024 Under the trading arrangement up to an aggregate of 10 000 shares of common stock are available to be sold by the broker upon reaching pricing targets defined in the trading arrangement
The Information required by Items 10 11 12 13 and 14 of Part III of Form 10 K has been omitted in reliance on General Instruction G 3 and is incorporated herein by reference to our proxy statement to be filed with the SEC pursuant to Regulation 14A promulgated under the Securities Exchange Act of 1934 as amended as set forth below
Except for the specific disclosures below the information required by this Item 10 is included under the headings Executive Officers Corporate Governance and Insider Trading Policy and Procedures in our 2024 Proxy Statement for the annual meeting to be held with respect to the fiscal year ended June 30 2024 2024 Proxy Statement and is incorporated by reference
We have adopted a code of ethics that applies to our principal executive officer principal financial officer principal accounting officer and persons performing similar functions That code our Standards of Ethics and Business Conduct is posted in the Investors Relations Corporate Governance section of our website at
We intend to disclose any amendment to the Standards of Ethics and Business Conduct that relates to any element of the code of ethics definition enumerated in Item 406 b of Regulation S K and any waiver from a provision of the Standards of Ethics and Business Conduct granted to any director principal executive officer principal financial officer principal accounting officer or any other executive officer of the Company in the Investors section of our website at
We have adopted a set of corporate governance guidelines in accordance with the requirements of Section 303A of the New York Stock Exchange Listed Company Manual Those guidelines can be found posted on our website at
The information required by this Item 11 will be incorporated herein by reference to the Proxy Statement for the 2024 Annual Meeting of Shareholders to be filed within 120 days after the end of the company s fiscal year
The information required by this Item 12 will be incorporated herein by reference to the Proxy Statement for the 2024 Annual Meeting of Shareholders to be filed within 120 days after the end of the company s fiscal year
The information required by this Item 13 will be incorporated herein by reference to the Proxy Statement for the 2024 Annual Meeting of Shareholders to be filed within 120 days after the end of the company s fiscal year
The information required by this Item 14 will be incorporated herein by reference to the Proxy Statement for the 2024 Annual Meeting of Shareholders to be filed within 120 days after the end of the company s fiscal year
All schedules have been omitted because they are not applicable not required or the information has been otherwise supplied in the consolidated financial statements or notes to consolidated financial statements
Amended and Restated Credit Agreement dated December 13 2021 by and among CACI International Inc as borrower Bank of America N A as administrative agent swing line lender and L C issuer and each of the lenders named therein
Master Accounts Receivable Purchase Agreement dated December 28 2018 among CACI International Inc CACI Inc Federal certain subsidiaries from time to time party thereto MUFG Bank Ltd as Administrative Agent and certain purchasers from time to time party thereto
Amendment No 1 to Master Accounts Receivable Purchase Agreement dated December 27 2019 among CACI International Inc CACI Inc Federal certain subsidiaries from time to time party thereto MUFG Bank Ltd as Administrative Agent and certain purchasers from time to time party thereto
Amendment No 2 to the Master Accounts Receivable Purchase Agreement dated December 24 2020 among CACI International Inc CACI Inc Federal certain subsidiaries from time to time party thereto MUFG Bank Ltd as Administrative Agent and certain purchasers from time to time party thereto
Amendment No 3 to the Master Accounts Receivable Purchase Agreement dated December 23 2021 among CACI International Inc CACI Inc Federal certain subsidiaries from time to time party thereto MUFG Bank Ltd as Administrative Agent and certain purchasers from time to time party thereto
Amendment No 4 to the Master Accounts Receivable Purchase Agreement dated December 22 2022 among CACI International Inc CACI Inc Federal certain subsidiaries from time to time party thereto MUFG Bank Ltd as Administrative Agent and certain purchasers from time to time party thereto
Amendment No 5 to the Master Accounts Receivable Purchase Agreement dated December 20 2023 among CACI International Inc CACI Inc Federal certain subsidiaries from time to time party thereto MUFG Bank Ltd as Administrative Agent and certain purchasers from time to time party thereto
Pursuant to the requirements of Section 13 or 15 d of the Securities Exchange Act of 1934 the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized on the 8

Company Name	CACI INTERNATIONAL INC /DE/ Vist SEC web-site
Category	SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN
Trading Symbol	CACI