In This Article:
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Revenue: $487.6 million, a decline of 1.4% year over year.
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Commercial Revenue Growth: Increased 22.1%, accounting for 29.5% of total revenues.
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Commercial Energy Revenue: Increased 21% year over year.
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Adjusted EBITDA Margin: Expanded 10 basis points to 11.3%.
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Non-GAAP EPS: Increased 9.6% to $1.94.
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Net Income: $26.9 million, slightly below last year's $27.3 million.
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Gross Margin: Expanded 80 basis points to 38%.
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Interest Expense: Declined to $7.3 million from $8.2 million in the prior year.
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Tax Rate: 10.5% in the first quarter, with a full-year expectation of 18.5%.
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Backlog: $3.4 billion, with $1.9 billion funded.
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Net Debt: $499 million, up from $475 million in the prior year.
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Share Repurchases: 313,000 shares for $35 million.
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Operating Cash Flow: Consumed $33 million due to seasonal working capital needs.
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Capital Expenditures: $3.5 million, down from $5.2 million a year ago.
Release Date: May 01, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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ICF International Inc (NASDAQ:ICFI) reported first-quarter revenues in line with expectations, demonstrating the strength of its diversified business model.
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Revenues from commercial energy clients increased by 21% year over year, driven by strong demand from utility clients.
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Adjusted EBITDA margin on total revenues expanded by 10 basis points to 11.3%, reflecting effective cost management.
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Non-GAAP EPS increased by almost 10%, outperforming first-quarter revenue comparisons.
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The integration of AEG, acquired in late 2024, was completed successfully, enhancing ICFI's capabilities in energy technology and advisory services.
Negative Points
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Revenues from federal clients declined by 12.6% compared to the previous year's first quarter, impacted by contract funding curtailments and a slower pace of new RFPs.
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Approximately $115 million of estimated 2025 revenues have been affected by stop work orders and contract terminations.
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The IT modernization business is expected to decline by 5% to 10% for the year due to delays in awards and procurement processes.
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First-quarter revenues declined by 1.4% year over year, attributed to one less workday and a decrease in US federal government pass-throughs.
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The backlog was adjusted to account for terminated federal government contracts, impacting it by approximately $375 million since the beginning of the year.
Q & A Highlights
Q: With the visibility into the business today, is it still your expectation that the second quarter will be the peak impact from federal government changes, or has your outlook changed? A: John Wasson, CEO: The federal environment remains fluid. We expect continued activity over the next several quarters, but Q2 and Q3 will likely see similar impacts as Q1, not significantly more.