DLH Business Overview - DLH InvestorRoom · resourcing of the “continuum of care requirements”...

DLH Business Overview Midwest IDEAS Investor Conference | August 26, 2015| Chicago

Zachary Parker | President & Chief Executive Officer

Kathryn JohnBull | Chief Financial Officer

“Safe Harbor" Statement under the Private Securities Litigation

Reform Act of 1995:

Please note that this presentation contains "forward-looking statements" as defined by

the Federal Securities Laws. Statements in this presentation regarding DLH Holding

Corp.’s business, which are not historical facts, are “forward-looking statements” that

involve risks and uncertainties. While these statements reflect DLH’s current views and

outlook, they are subject to factors that could cause its future results to differ materially.

These risks and uncertainties are discussed in detail in our documents filed with the SEC,

specifically the most recent reports on Form 10-Q and 10-K.

Forward Looking Statement

© 2015 | DLH | Proprietary | Business Overview 08-26-15 2

• Roots date back to 1969

• Became pure-play government services 2010

– Trend of large annual losses and revenue erosion

– Board engaged independent firm for assessment

– Divested commercial healthcare businesses

– Retained ~ $40M revenue government operation

• Changed out Leadership Team (2010-2012)

• Publicly traded since 1986

• Over 1,200 employees nationwide

• Turnaround and “transformation” in motion…


45 Year-old “Start-up”


Strategic Governance and Leadership Team

Dr. Elder Granger, MD

(General, US Army Ret.)

Board Director

Rick Wasserman

Chairman of Board

Board Director

Building a Board of Directors with relevant industry experience

William Alderman

A&D Investment Banker

Board Director

Zachary Parker, President & Chief Executive Officer

John Armstrong, Executive Vice President, FACHE

Kathryn JohnBull, Chief Financial Officer

Kevin Wilson, President DLH Solutions

Executive Leadership Team

Austin Yerks

Fmr Industry Leader

Board Director

Zach Parker

President &CEO

Board Director(FY2010)(FY2015)(FY2013)

• Each with over 20 years government experience

• Successful track records in the industry


Key Company Turnaround Milestones

FY2010-2012: Changed Corporate Leadership

FY2011: Long Range Strategic Plan (LRSP) Developed

FY2012: Create Stability and Backlog

FY2013: Project L.E.A.N. Cost Realignment

FY2014-15: Financial Health and Business Development

FY2016: Technology leverage and Strategic Growth


Value-focused Strategy

What We Do

Primary DLH business areas

Healthcare

Delivery and

Technology

• Clinical device research and

development

• Medication Therapy

Management (pharma)

• Access to care (behavioral and

meds)

• Case management tools and

services

• Lifecycle management of

medical devices

• Analytics and decision support

systems

• Supply chain and inventory

management


Medical

Logistics

Solutions


Planned growth in current and adjacent markets

1. Current and emerging DLH market differentiators

2. Existing core competencies and agency-specific value propositions

3. FY15 and on-going health information systems investments

4. Strategic IT and technology partnerships

Leveraging:

So how do we get there…

ST

RA

TE

GIC

M

OD

EL

PO

SIT

ION

ING

K

EY

S

DRIVE PERFORMANCE

EXCELLENCE

BUILD UPON CURRENT

DIFFERENTIATORS

BUILD POWERHOUSE

MARKETING POSITION

DEPLOY CAPITAL

FOR GROWTH

NAVIGATE POLITICAL

ENVIRONMENT ISSUES

DLH

P

LA

YB

OO

K

Organic Growth Acquisitions Margin Expansion Shareholder Value

Leverage outstanding performance track record that has resulted

JD Power award for Veterans Affairs client to expand within the VA

and adjacent federal health oriented markets (including DoD)

GAMEPLAN

GROWTH

Build upon current

market leading

customer satisfaction

Instill continuous

improvement culture

throughout operations

Accelerate technology

refresh cycle time

Prioritize healthcare

COTS solutions where

feasible

Deliver strategically

aligned and robust

“Qualified NB Pipeline”

Expand and align

business development

resources

Make acquisitions

consistent with growth

strategy

Solidify financing

capacity

Ensure adequate and

scaled “Deal Flow”

Increase connectivity

to market “Shapers”

Engage trade

associations & capital

market affiliations

Align composition of

board of directors to fit

Focus growth where government decision makers prioritize “best

value” over “lowest and cheapest price”

Shape new business pursuits around greater complexity work

requirements which typically yield higher gross margins

Use dramatically improved company financial health posture to add

appropriately scaled acquisition to the DLH playbook

Key Financial Facts


Share Statistics

Trading Symbol (Nasdaq)...........................DLHC

Stock Price (8-4-2015)...................................$2.77

52wk Range ...................................$1.70 - $3.65

3 Month Avg. Volume ............................... 37,379

Shares Outstanding ………………...............9.6M

Management Options ................……………2.3M

Fully Diluted Shares ................................. 11.9M

Insider Ownership, fully diluted.................. 24.1%

Market Capitalization (8-4-2015)...............$26.46M

Financials (TTM) (1)

Revenue ..................................................$63.9M

Adjusted EBITDA (2).................................. $2.3M

Operating Cash Flow ................................ $1.3M

Pro Forma EPS (2) .….................................$0.23

Cap Structure (1)

Cash on Hand .......................................... $4.7M

Total Debt.................................................. $0.0M

Shareholder Equity ................................. $14.6M

Other

Full-time Employees .................................. 1,200

Fiscal Year Ends ............................... September

Public Acctng Firm………Withum Smith & Brown

Website ................................ www.dlhcorp.com

Corporate HQ ................................... Atlanta, GA

(1) Financial data as of FY2015 3rd quarter ended June 30, 2015

(2) A non-GAAP financial measure. See reconciliation to GAAP in back up

slides


Hypothetical Growth Income Statements w/Pro forma EPS

• Scenarios do not represent forecasts and are not related to a defined time

• Scenarios presented solely to demonstrate potential margin improvement and operating leverage

• Revenue growth via organic & acquisitive means dilutes legacy work to 70/60/50% of total revenue

• Legacy business GM continues at 17-18% range, new business at 25-30%

• Combined operating expense rate, trending down as operating leveraged derived

• Increased borrowing/interest expense to achieve growth

Growth Game Plan Hypothetical Scenarios

12

Current business contribution

Organic and acquisitive new

business contribution

Revenue $100M $150M $200M

Gross margin $20 $31 $44

Income from ops $ 6 $11 $18

Net income $ 2 $ 5 $ 9

Adjusted EBITDA $ 7 $13 $20

Pro Forma EPS $0.50 $0.93 $1.43

($ in million, except per share amounts)

• Scenarios do not represent forecasts and are not related to a defined time

• Scenarios presented solely to demonstrate potential margin improvement and operating leverage

• Revenue growth via organic & acquisitive means dilutes legacy work to 70/60/50% of total revenue

• Legacy business GM continues at 17-18% range, new business at 25-30%

• Combined operating expense rate, trending down as operating leveraged derived

• Increased borrowing/interest expense to achieve growth

13 © 2015 | DLH | Proprietary | Business Overview 08-26-15

Q&A

14 © 2015 | DLH | Proprietary | Business Overview 08-26-15

Backup Slides


FY15 Q3 Key Trends for Past Five Quarters


FY15 Q3 over PY Q3 – Three Months


FY15 Q3 YTD over PYTD – Nine Months


Historical Income Statement Trends


Reconciliation of non-GAAP measures


Balance Sheet Trends


Cash Flow Trends


Expertise And What We Do In Healthcare…

Health Delivery and Technology

Enhance “Medically Ready” status of service-members in theater through medical device RDT&E and biomedical engineering services

Health and pharmacy management systems integration testing and IV&V covering a range of client and new vendor hardware and software systems

Combat trauma care systems and services; healthcare provider examinations and administrative services including use of CHCS, AHLTA, and ICD-B systems at DoD’s MTFs

Provide variety of allied, specialty and general medical services to VA Medical Centers, Community-based Outpatient Clinics, transitional housing and medical home centers including VistA systems

Laboratory and field research studies and services including surveys, sampling, and data collection/recording


Unique Breadth And Depth In Pharmacy Area

Coverage ranging from single clinic to operating in high-volume

automated prescription production and distribution system environments.

• Virtual / Tele-pharmacy services

• Pharmacy systems automation (including robotics),

implementation, and testing

• Bio-hazards management; Med/Surg systems and

equipment

• Cold storage systems; Specialty-meds

• Controlled substance management

• Prescription servicing and Quality Assurance (out-

patient and in-patient)

• Medical warehouse supply chain management

DLH delivers high-value performance in partnership with and in support

of customers, teams, and end-users as measured by….


Differentiation- Values, Tools & Technology

DLH’s ePRAT provides a web-based, open-architecture,

secure system to manage expert delivery and

resourcing of the “continuum of care requirements”

for combatants, veterans, and retirees

Designed for HIPAA, CCAC, CARF, FISMA, NIST requirements

DLH’s unique approach to integration of people,

processes, and technology tools to measure,

manage and optimize our performance at project or

enterprise levels.

© 2015 | DLH | Proprietary | Business Overview 08-26-1525

3564 Piedmont Road NE

Building 3, Suite 700

Atlanta, GA 30305

www.DLHCorp.com

DLH Business Overview - DLH InvestorRoom · resourcing of the “continuum of care requirements”...

Documents

Transcript of DLH Business Overview - DLH InvestorRoom · resourcing of the “continuum of care requirements”...