CACI International (CACI) UBS Global Industrials and Transportation Conference summary

Strategic transformation and business model evolution

• Shifted from 80% expertise/20% technology to 45% expertise/55% technology over the past decade, focusing on technology-driven national security solutions.

• Emphasized outcome-based and software-defined solutions, moving away from labor-hour contracts to delivering measurable results and efficiency for government clients.

• Achieved a 7%+ CAGR in revenue over the last five years, generating over $2.3 billion in free cash flow and maintaining a book-to-bill ratio of 1.6x.

• Margins improved from 8.5–9.5% to the high 10s%, with a focus on sustainable free cash flow per share growth.

• Investment strategy prioritizes internal development, partnerships, and targeted M&A to fill technology gaps and accelerate growth.

Market trends, government priorities, and efficiency initiatives

• National security remains a bipartisan funding priority, with consistent support across administration changes.

• Government demand is shifting from counterterrorism to near-peer threats, requiring rapid, software-driven solutions for agility and speed.

• Efficiency initiatives like DOGE create market uncertainty but are expected to drive further demand for resilient, modernized, and cost-effective solutions.

• Most business is focused on DOD, intelligence, and DHS, with minimal exposure to federal civilian or citizen-facing services.

• Network modernization and IT upgrades are key growth areas, with programs like EITaaS returning personnel to core missions and reducing legacy system dependencies.

Business development, contract strategy, and financial outlook

• Adopted a 'bid less, win more' approach, focusing on larger, longer-duration contracts and increasing average award size.

• Secured 11 contracts over $1 billion in the past 36 months, with backlog duration doubling from three to six years since 2017.

• Multi-year financial targets are based on backlog transparency and business development strength, not on specific budget assumptions.

• Margins are driven by portfolio mix, with a deliberate move toward high-margin, software-based technology solutions.

• Free cash flow per share is the primary performance metric, with executive incentives aligned accordingly.