CACI Reports Fourth Quarter and Annual Results

ARLINGTON, Va., Aug. 16 /PRNewswire-FirstCall/ -- CACI International Inc , a leading information technology and network solutions provider to the federal government, announced today record results for its fourth fiscal quarter and twelve months ending June 30, 2006. CACI is a leading strategic consolidator in its market space and provides innovative solutions to meet America's national needs in defense, intelligence, homeland security, and the transformation of government.

Fourth Quarter Results

The results described in this release include the adoption of Financial Accounting Standards Board Statement No. 123R, "Share-Based Payment" (FAS 123R) and the resulting non-cash charges. The fourth quarter and all of Fiscal Year 2005 (FY05) have been restated as if FAS 123R was in effect as of July 1, 2004, the beginning of FY05.

For the fourth quarter of Fiscal Year 2006 (FY06) the Company reported revenue of $477.3 million, up $47.6 million, or 11.1 percent, over FY05 fourth quarter revenue of $429.8 million. Operating income for the quarter was $40.7 million versus operating income of $38.0 million in the year earlier quarter, an increase of 7.2 percent. The Company's operating margin in the quarter was 8.5 percent compared with 8.8 percent in the year earlier quarter. Net income for the fourth quarter was $22.1 million, or $0.71 per diluted share, compared with $22.0 million, or $0.71 per diluted share, for the fourth quarter of FY05.

Fourth Quarter Highlights:

In addition to the revenue and earnings, major highlights and accomplishments during the fourth quarter of FY06 include:

* Contract awards totaling over $329 million, including: -- One of six prime contractors on the Support for Management and Resources for Technical Services (SMART) contract for the National Geospatial-Intelligence Agency with an estimated ceiling value of $200 million. The award positions the Company to be a key participant in the modernizing of the agency's infrastructure and support services. -- $42 million prime contract award to continue to provide the CACI-developed Wide Area Workflow-Receipt and Acceptance application to the Defense Information Systems Agency (DISA) for the next five years. The award expands CACI's work in providing this solution, which will aid in the transformation of DISA's business processes. -- The first task order, valued at $33 million, under the $19.25 billion Strategic Services Sourcing (S3) contract for the U.S. Army's Communications-Electronics Life Cycle Management Command. The award expands CACI's support to the Defense Intelligence Agency. * Contract funding orders totaled $495 million, a 14 percent increase over the year earlier quarter. * Completed the merger of AlphaInsight Corporation, a provider of leading-edge IT solutions to the U.S. Government. The company has a strong presence at the Department of State, and has approximately 360 employees, with essentially all its employees holding security clearances. Full Year FY06 Results

For the full fiscal year of FY06, revenue increased 8.1 percent to $1.76 billion versus $1.62 billion of revenue for FY05. Operating income increased to $150.3 million, 5.7 percent higher than the $142.1 million reported in FY05. The Company's operating margin was 8.6 percent for FY06 compared with 8.8 percent for FY05. Net income for FY06 was $84.8 million, or $2.72 per diluted share, 6.4 percent higher than net income of $79.7 million, or $2.61 per diluted share, for FY05. Operating cash flow for FY06 was $107.1 million compared with $126.6 million in FY05. Contract funding orders for FY06 totaled approximately $1.76 billion compared with $1.80 billion in FY05.

FY06 Highlights

In addition to the record revenue and earnings, major highlights and accomplishments during FY06 include:

* Total announced contract awards for the year increased 63 percent to approximately $2.0 billion including: -- $188 million to support the U.S. Naval Sea Systems Command Program Executive Office for Littoral and Mine Warfare. The award expands CACI's business with the command and significantly increases the Company's engineering and logistics business. -- One of two prime contractors on the $450 million Engineering, Technical and Operations Support Services (ETOSS) program for the U.S. Army's Communications-Electronics Research, Development and Engineering Center. A major recompeted contract, the award continues the Company's long-term relationship of more than 18 years with this customer. -- $107 million prime five-year contract award to support the Naval Supply Systems Command's Automatic Identification Technology (AIT) Program office. The award increases the size and scope of the Company's work with this client, and expands the Company's core engineering, logistics and systems integration areas. -- Over $300 million in previously unannounced national security and intelligence work. * In addition to the above announcements, the Company was awarded one of four large company positions on the U.S. Army's $19.25 billion ceiling S3 contract. * Funded backlog was $983 million, up 11 percent over the previous year's funded backlog of $887 million; total backlog at the end of FY06 was approximately $4.6 billion, 35 percent higher than the year earlier figure of $3.4 billion. * Completed five acquisitions: National Security Research, Inc., Information Systems Support, Inc., and AlphaInsight Corporation for the domestic operations, and TechComputerOffice Limited and Sophron Partners Ltd. for the United Kingdom operations. Combined, these firms had annual revenue of approximately $250 million. * Named to the Fortune 1000 list of the largest companies in America, placing 921st. The Company also ranked as the eighth largest IT services company in the annual Fortune 500 listing of the top IT firms in America. Other Item

During July, we divested the assets supporting the Port Engineer Services portion of the Surface Ship Maintenance Improvement Program contract. The services provided by our port engineers aboard Navy ships could have resulted in a potential conflict with services that CACI performs under one or more of its other Navy contracts. Revenue reported for these assets in FY06 was approximately $20 million.

CEO's Commentary

Commenting on the results for fiscal year 2006, Dr. J.P. (Jack) London, CACI's Chairman, President, and CEO said, "We are very pleased to conclude our fiscal year 2006 well-positioned for accelerating our growth in fiscal year 2007. Our record $2 billion in contract awards gives us a firm foundation going forward, and we anticipate a return to higher levels of contract funding. In addition, as a result of the major contract awards we received, we experienced significant success in being recognized as a leader in our marketplace."

"We have also strengthened our operations through the five acquisitions we successfully completed and fully integrated during fiscal year 2006. We will continue to target strategic acquisition opportunities that allow us to expand our capabilities, increase our customer coverage in our areas of strategic focus, and build our talented employee base. Overall, our fundamentals remain strong, the health of our business is excellent, and we believe the outlook is very positive."

Dr. London continued, "The continuing conflicts around the world reinforce the need for CACI's services in support of national defense, intelligence, homeland security, and the transformation of government. The government will continue to provide necessary funding for these high-priority areas. In the future, CACI will continue to enhance our solutions to best meet the requirements of our valued customers and increase the value we offer to our shareholders."

CACI Guidance

The Company issued its guidance for its first fiscal quarter and all of Fiscal Year 2007 (FY07). This guidance excludes the revenue or earnings from future acquisitions that may be completed prior to the end of FY07.

(In millions except for earnings per share) 1st Quarter Total Year Revenue $454 - $473 $2,000-$2,100 Diluted earnings per share $0.57 - $0.61 $2.91-$3.15 Diluted weighted average shares 31.4 31.4

This guidance represents our views as of August 16, 2006. Investors are reminded that actual results may differ from these estimates for the reasons described below and in our filings with the Securities and Exchange Commission.

Conference Call Information

The company has scheduled a conference call for 8:30 AM Eastern Time Thursday, August 17th, during which management will be making a brief presentation focusing on fourth quarter results, operating trends and its expectations. A question-and-answer session will follow to allow further discussion of the results and the Company's future expectations. Interested parties can listen to the conference call and view the accompanying exhibits over the Internet by logging on to CACI's Internet site at http://www.caci.com/ at the scheduled time. A replay of the call will also be available over the Internet beginning at 1:00 PM Eastern Time Thursday, August 17th, and can be accessed through CACI's homepage (http://www.caci.com/) by clicking on the CACI Investor Info button.

About CACI

CACI International Inc provides the IT and network solutions needed to prevail in today's new era of defense, intelligence, and e-government. From systems integration and managed network solutions to knowledge management, engineering, simulation, and information assurance, we deliver the IT applications and infrastructures our federal customers use to improve communications and collaboration, secure the integrity of information systems and networks, enhance data collection and analysis, and increase efficiency and mission effectiveness. Our solutions lead the transformation of defense and intelligence, assure homeland security, enhance decision-making, and help government to work smarter, faster, and more responsively. CACI has been named to the Fortune 1000 Largest Companies of 2006. A member of the Russell 1000 index, CACI provides dynamic careers for approximately 10,200 employees working in over 130 offices in the U.S. and Europe. CACI is the IT provider for a networked world. Visit CACI on the web at http://www.caci.com/.

There are statements made herein which do 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. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. The factors that could cause actual results to differ materially from those anticipated include, but are not limited to, the following: regional and national economic conditions in the United States and the United Kingdom, including conditions that result from terrorist activities or war; changes in interest rates; currency fluctuations; failure to achieve contract awards in connection with recompetes for present business and/or competition for new business; the risks and uncertainties associated with client interest in and purchases of new products and/or services; continued funding of U.S. Government or other public sector projects in the event of a priority need for funds, such as homeland security, the war on terrorism or rebuilding Iraq; government contract procurement (such as bid protest, small business set asides, loss of work due to organizational conflicts on interest etc.) and termination risks; the results of government investigations into allegations of improper actions related to the provision of services in support of U.S. military operations in Iraq; individual business decisions of our clients; paradigm shifts in technology; competitive factors such as pricing pressures and/or competition to hire and retain employees (particularly those with security clearances); market speculation regarding the continued independence of the Company; material changes in laws or regulations applicable to our businesses, particularly in connection with (i) government contracts for services, (ii) outsourcing of activities that have been performed by the government, and (iii) competition for task orders under Government Wide Acquisition Contracts ("GWACs") and/or schedule contracts with the General Services Administration; our own ability to achieve the objectives of near term or long range business plans; changes that could result from accounting adjustments requested in connection with finalizing our Report on Form 10-K; and other risks described in the company's Securities and Exchange Commission filings.

For investor information contact: David Dragics, Vice President, Investor Relations [phone], [e-mail] other information contact: Jody Brown, Executive Vice President, Public Relations [phone], [e-mail] Financial Tables CACI International Inc Consolidated Statements of Operations (Unaudited) (Amounts in thousands, except per share amounts) Quarter Ended Twelve Months Ended 6/30/2006 6/30/2005 6/30/2006 6/30/2005 (As restated) (As restated) Revenue $477,329 $429,778 $1,755,324 $1,623,062 Costs of revenue Direct costs 314,192 278,281 1,134,951 1,019,474 Indirect costs and selling expenses 112,548 105,525 436,656 429,434 Depreciation and amortization 9,842 7,950 33,437 32,022 Total costs of revenue 436,582 391,756 1,605,044 1,480,930 Operating income 40,747 38,022 150,280 142,132 Interest expense, net 5,543 3,820 17,279 14,765 Income before income taxes 35,204 34,202 133,001 127,367 Income taxes 13,114 12,243 48,161 47,642 Net income $22,090 $21,959 $84,840 $79,725 Basic earnings per share $0.72 $0.73 $2.81 $2.69 Diluted earnings per share $0.71 $0.71 $2.72 $2.61 Weighted average shares used in per share computations: Basic 30,544 29,963 30,242 29,675 Diluted 31,300 30,868 31,161 30,564 Statement of Operations Margin Data (Unaudited) (Unaudited) Quarter Ended Twelve Months Ended 6/30/2006 6/30/2005 6/30/2006 6/30/2005 (As restated) (As restated) Operating profit margin 8.5% 8.8% 8.6% 8.8% Net profit margin 4.6% 5.1% 4.8% 4.9% Stock Option Expense Data (Unaudited) (Unaudited) Quarter Ended Twelve Months Ended 6/30/2006 6/30/2005 6/30/2006 6/30/2005 (As restated) (As restated) Stock option expense $1,755 $2,239 $10,518 $8,932 Stock option expense, net of tax $1,101 $1,444 $6,709 $5,591 CACI International Inc Condensed Consolidated Balance Sheets (Unaudited) (Amounts in thousands) 6/30/2006 6/30/2005 (as restated) ASSETS: Current assets Cash and cash equivalents $24,650 $132,965 Accounts receivable, net Billed 349,079 311,046 Unbilled 42,934 27,009 Total accounts receivable, net 392,013 338,055 Other current assets 33,166 21,910 Total current assets 449,829 492,930 Property and equipment, net 25,082 24,261 Goodwill & intangible assets, net 832,184 636,606 Other 60,995 52,842 Total assets $1,368,090 $1,206,639 LIABILITIES & SHAREHOLDERS' EQUITY: Current liabilities Notes payable $3,543 $3,641 Accounts payable 44,921 36,900 Accrued compensation & benefits 93,398 91,663 Other current liabilities 69,503 76,540 Total current liabilities 211,365 208,744 Notes payable, long-term 364,317 342,861 Supplemental retirement savings plan obligations 32,734 25,059 Other long-term liabilities 14,315 8,941 Shareholders' equity 745,359 621,034 Total liabilities & shareholders' equity $1,368,090 $1,206,639 CACI International Inc Condensed Consolidated Statements of Cash Flows (Unaudited) (Amounts in thousands) Twelve Months Ended 6/30/2006 6/30/2005 (as restated) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $84,840 $79,725 Reconciliation of net income to net cash provided by operating activities Depreciation and amortization 33,437 32,022 Amortization of deferred financing costs 1,421 1,344 Stock-based compensation expense 15,496 11,207 Deferred income tax expense 1,140 (9,665) Changes in operating assets and liabilities Accounts receivable, net 161 5,493 Other current assets (8,487) (1,390) Accounts payable and accrued expenses (14,982) (10,714) Accrued compensation & benefits (3,324) 8,293 Income taxes receivable/payable (10,572) 4,366 Other current liabilities 7,957 5,875 Net cash provided by operating activities 107,087 126,556 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (9,521) (8,793) Purchases of businesses, net of cash acquired (244,293) (6,647) Net redemptions of marketable securities - 515 Other assets (5,279) (1,634) Net cash used in investing activities (259,093) (16,559) CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings (repayments) 21,359 (65,729) Proceeds from employee stock transactions 7,158 7,261 Proceeds from exercise of stock options 10,422 16,351 Repurchase of common stock (7,512) (8,362) Other 11,883 10,490 Net cash provided by (used in) financing activities 43,310 (39,989) Effect of exchange rates on cash and equivalents 381 (72) Net increase (decrease) in cash and equivalents (108,315) 69,936 Cash and equivalents, beginning of period 132,965 63,029 Cash and equivalents, end of period $24,650 $132,965 Revenue by Customer Type (Unaudited) Quarter Ended (dollars in thousands) 6/30/2006 6/30/2005 $ Change % Change Department of Defense $347,982 72.9% $315,353 73.3% $32,629 10.3% Federal Civilian Agencies 102,383 21.5% 88,391 20.6% 13,992 15.8% Commercial 20,624 4.3% 18,892 4.4% 1,732 9.2% State and Local Government 6,340 1.3% 7,142 1.7% (802) -11.2% Total $477,329 100.0% $429,778 100.0% $47,551 11.1% Twelve Months Ended (dollars in thousands) 6/30/2006 6/30/2005 $ Change % Change Department of Defense $1,282,582 73.1% $1,179,259 72.7% $103,323 8.8% Federal Civilian Agencies 374,502 21.3% 350,886 21.6% 23,616 6.7% Commercial 73,644 4.2% 68,140 4.2% 5,504 8.1% State and Local Government 24,596 1.4% 24,777 1.5% (181) -0.7% Total $1,755,324 100.0% $1,623,062 100.0% $132,262 8.1% Reconciliation of Total Revenue Growth and Organic Revenue Growth (Unaudited)

The Company has presented organic revenue growth, as presented, to reflect the

effect of acquisitions on total revenue growth. The Company believes that this non-GAAP financial measure provides investors with useful information to

evaluate the growth rate of the Company's core business. This non-GAAP measure should not be considered in isolation or as a substitute for performance measures prepared in accordance with GAAP. Quarter ended Twelve months ended (dollars in thousands) 6/30/06 6/30/05 % Change 6/30/06 6/30/05 % Change Revenue, as reported $477,329 $429,778 11.1% $1,755,324 $1,623,062 8.1% Less: Acquired revenue 50,886 - 77,170 - Organic revenue $426,443 $429,778 -0.8% $1,678,154 $1,623,062 3.4% Revenue by Contract Type (Unaudited) Twelve Months Ended (dollars in thousands) 6/30/2006 6/30/2005 $ Change % Change Time and materials $899,151 51.2% $925,074 57.0% $(25,923) -2.8% Cost reimbursable 500,463 28.5% 405,801 25.0% 94,662 23.3% Fixed price 355,710 20.3% 292,187 18.0% 63,523 21.7% Total $1,755,324 100.0% $1,623,062 100.0% $132,262 8.1% Revenue Received as a Prime versus Subcontractor (Unaudited) Twelve Months Ended (dollars in thousands) 6/30/2006 6/30/2005 $ Change % Change Prime $1,449,622 82.6% $1,371,125 84.5% $78,497 5.7% Subcontractor 305,702 17.4% 251,937 15.5% 53,765 21.3% Total $1,755,324 100.0% $1,623,062 100.0% $132,262 8.1%