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ICF International (ICFI) Beats on Q2 Earnings and Revenues

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ICF International, Inc. (ICFI - Free Report) reported impressive second-quarter 2020 numbers, with both earnings and revenues beating the Zacks Consensus Estimate.

Non-GAAP EPS of 89 cents surpassed the consensus mark by 29% but declined 8.2% on a year-over-year basis. Revenues of $354 million beat the consensus mark by 2.1% but decreased 3.5% year over year mainly due to lower pass-through revenues.

Over the past year, ICF’s shares have depreciated 12.4% as against 9.3% growth of the industry it belongs to.

 

Revenues in Detail

Revenues from government clients came in at $246.8 million, flat year over year. The U.S. federal government revenues of $170.7 million increased 20.8% year over year and contributed 48% to total revenues. The U.S. state and local government revenues of $58 million decreased 20.7% year over year and contributed 17% of total revenues. International government revenues of $23.1 million were down 42.7% year over year, contributing 5% of total revenues.

Commercial revenues totaled $107.2 million, down 11.2% from the year-ago quarter’s figure and contributed 33% of total revenues. Energy markets and marketing services contributed 54% and 35%, respectively, to commercial revenues.

Backlog and Value of Contracts

Total backlog and funded backlog amounted to $2.4 billion and $1.3 billion at the end of the second quarter, respectively. The total value of contracts awarded in the quarter came in at $282million.

Operational Results

Adjusted EBITDA of $32.5 million declined marginally from the year-ago quarter’s figure. Adjusted EBITDA margin of 9.2% increased 30 basis points (bps) year over year. Adjusted EBITDA margin on service revenues was 12.4%, down 60 bps year over year.

Balance Sheet

ICF exited the quarter with cash and cash equivalent balance of $9.1 million compared with the $58.7 million recorded at the end of the previous quarter. The company had a long-term debt of $441 million compared with $507 million witnessed at the end of the prior quarter.

The company used $26 million of cash from operating activities, and capex was $4.3 million. ICF paid out dividends of $2.6 million in the reported quarter.

2020 Guidance

Management reiterated its guidance for 2020. Revenue expectation continues to be $1.45-$1.51 billion, the midpoint ($1.48 billion) of which is greater than the current Zacks Consensus Estimate of $1.47 billion.

Non-GAAP EPS is expected in the range of $3.50 to $3.80, the midpoint ($3.65) of which is greater than the current Zacks Consensus Estimate of $1.64 billion.

EBITDA is expected to be $126-$136 million. Operating cash flow is anticipated to be around $110 million.

ICF currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Business Services Companies

Equifax (EFX - Free Report) reported better-than-expected second-quarter 2020 adjusted earnings of $1.60 per share, which beat the Zacks Consensus Estimate by 22.1% and improved 14.3% on a year-over-year basis. The reported figure exceeded the guided range of 78-88 cents.

IQVIA Holdings (IQV - Free Report) reported second-quarter 2020 adjusted earnings per share of $1.18, which beat the consensus mark by 12.4% but decreased 22.9% on a year-over-year basis. The reported figure lies within the guided range of $1.00-$1.09.

Robert Half (RHI - Free Report) reported second-quarter 2020 earnings of 41 cents per share beat the consensus mark by 17% but were down 58% year over year.

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