Maximus, Inc.

call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, James Francis, Vice President of Investor Relations.

Good morning, and thanks for joining us. With me today is Bruce Caswell, President and CEO of David Mutrin, CFO, and Jessica Batt, Vice President of Investor Relations. I'd like to remind everyone that a number of statements being made today will be forward-looking in nature. Please remember that such statements are only predictions. Actual events and results may differ materially as a result of risks we face, including those discussed in Item 1A of our most recent forms 10Q and 10K. We encourage you to review the information contained in our recent filings with the SEC and our earnings press release. The company does not assume any obligation to revise or update these forward-looking statements to reflect subsequent events or circumstances, except required by law. Today's presentation also contains non-GAAP financial information. For a reconciliation of the non-GAAP measures presented, please see the company's most recent forms 10-Q and 10-K. And with that, I'll hand the call over to Bruce.

Thanks, James, and good morning. I'll begin by recapping fiscal year 2025, which was notable not only for the financial results, but for our team's ability to remain focused on serving our customers amidst a period of significant change in the government services sector. I'll then cover our priorities for fiscal year 2026, aligned with our strategic vision and current and anticipated future market conditions, including investments that are designed to prepare Maximus for what we believe are meaningful growth and market expansion opportunities. Investments in AI capabilities are an important priority and reflect our evolution as a technology-driven partner to governments. Fiscal year 2025 was a year of significant achievement for Maximus, marked by success across multiple domains. We entered the year with strong visibility into the underlying portfolio of the business, both in terms of revenue and backlog and certain programs returning to more steady state levels following post-pandemic upticks. We guided with prudent judgment given the changing political environment. In what emerged as a markedly different approach by the current administration following the transition, we carefully navigated an uncertain environment that brought new priorities and opportunities that developed as the year progressed. Looking back at where we started, I am pleased to report that revenue and profitability came in higher than projected reflecting both the strength of our core operations and the disciplined execution of our strategy throughout the year. The organic growth rate of the consolidated business was 3.9%, with the U.S. federal services segment delivering 12.1% organic growth and the outside the U.S. segment delivering 4.1% organic growth. This outcome is attributable to the dedication of our teams across the enterprise who are delivering on customer priorities. Equally important, our contractual relationships remain stable and secure throughout the year, with cancellations or impacts at just one-half percent of fiscal year 2025 revenue, a figure that is unchanged from our prior earnings call. This underscores the essential nature of the services we provide and the trust our customers place in us to support their mission and deliver outcomes that matter in a dynamic operating environment. Even as policy and technology continue to evolve, We believe that maintaining and expanding these long-term commitments is a testament to the value we deliver and the quality and reliability of our services. Taken together, the strong fiscal year 2025 financial results, the durability of our customer relationships, and the strategic investments we are making give us confidence in our future as a tech-enabled, mission-critical partner to government. We are proud of what we accomplished, and we are energized by the momentum we are carrying into fiscal 2026. Our focus remains on delivering consistent performance, maintaining trusted partnerships, and utilizing our increased customer presence and evolving capabilities for future growth. Looking ahead, I want to share three strategic priorities on which we are executing during fiscal 2026 that we believe are favorably positioning the business for opportunities to accelerate growth in fiscal year 2027 and beyond. These priorities include, first, expanding in U.S. federal markets Second, policy-driven initiatives, mainly around the One Big Beautiful Bill Act, actionable in our U.S. services segment. And third, deployment of AI and related tech-enabled automation. Our commitment to advancing this third priority is driving an important transformation across Maximus, from how we execute internal functions and support our employees, to the delivery of our performance-based contracts, and also to the expansion of our technology-based solutions for governments. I'll note that these and other investments were made possible by our earlier focus on what we called Maximus Forward, an organization-wide commitment to rethinking critical business functions and their cost. Starting with our U.S. federal business, our commitment to delivering even greater value to our customers is unwavering. We also believe the investments we made through both inorganic and organic means have expanded capacity, enhanced our competitiveness, and created platforms that we believe can provide durable organic growth. In prior quarters, I've spoken about our efforts to strengthen our infrastructure, for example, rapidly achieving CMMC level two certification and capabilities through what we call mission threads that tie directly to the pipeline we're prosecuting over the next several years. We believe our foundation for sustained growth is robust and that we are aligned with, and in many cases, ahead of the evolving needs of our customers. We are confident in the opportunities ahead and our ability to continue to create long-term value for shareholders. Our federal leaders and teams are aligned strategically to civilian, health, and defense and national security markets. I'll speak briefly to each. We are recognized for having a distinguished portfolio of civilian work, delivering essential services for student loan management, the IRS, and the SEC as examples. We occupy a vital corridor of the civilian space and have deliberately aligned to bipartisan priorities that are fundamental to the government's role of supporting its citizens. We continue to see opportunities to deliver on the administration's priorities for modernized, accountable, and cost-effective citizen services, while recognizing how budget priorities are increasing the importance of blending deep program expertise with commercial innovation. Many modernization needs remain unaddressed and we believe that Maximus is well positioned to address these priorities. With an earned reputation in the delivery of performance-based contracts and tech modernization, we are regularly engaged as trusted advisors, leveraging our investment in solution architects and are favorably positioned for the opportunities we are tracking. To our knowledge, Maximus is the only public company in our sector that has formally documented its mix of contracts that are performance-based, which stands at 54.4% for fiscal year 2025. We believe this distinction reinforces our leadership in driving accountable and measurable results. I've commented previously that the timing of procurements is less certain in the civilian pipeline than we've historically experienced, which highlights the importance of supporting our customers and delivering our current programs with a continued emphasis on quality and efficiency. Additionally, we've noted our investment in further differentiating Maximus as a leader in enabling the citizen experience, or CX, of the future. Our total experience management, or TXM, solution, which I've mentioned on prior calls, is a FedRAMP secure, modular, flexible, scalable, and configurable platform that helps enable federal agencies deliver smarter, citizen-centric services. AI-infused and packaged and sold as a cloud-based service, which is rapidly becoming the preferred procurement method of government agencies, we believe that TXM is well-positioned to replace end-of-life on-premise systems. I'm proud of what our team has developed, as evidenced by a recent demo where TXM was said to be one of the most advanced and integrated demonstrations of AI in a CX platform for government, yet experienced by the customer. We believe TXM is a strong fit for the pipeline of contact center consolidations we see in the market. On to the health market, which we define as including defense and non-defense related programs and opportunities. After setting a deliberate course in this market with the 2021 acquisition of Veterans Valuation Services, we are pleased to see synergy pipeline opportunities for new customers coming to bid and Maximus well positioned with what we believe are competitive solutions. Compared to the civilian pipeline, I'm encouraged by the procurement tempo of health opportunities. with key procurement milestones largely on track. Given current conditions and the nature of the programs we're bidding, we anticipate that outcomes could be consequential for fiscal 2027 and beyond. In the defense and national security area, our strategic pursuit of certain opportunities has been affirmed by the highly credible wins with new customers we've seen seeking a change from traditional providers. Let me share one example. Most recently, Maximus was awarded a new Joint Cyber Command and Control Readiness contract by the United States Air Force Lifecycle Management Center's Cryptologic and Cyber Systems Division. This award with a potential value of $86 million marks our second major engagement with the Air Force under this program and represents meaningful expansion of our technology services portfolio within the defense sector. Through this contract, Maximus will lead engineering analysis, software modification, maintenance, and enhancement, as well as the maturation of existing architecture and infrastructure. The period of performance includes a base year, four one-year option periods, and an optional six-month extension. We believe this award reflects the depth of our technology expertise and delivery capability, underscoring our ability to support the Air Force's defense readiness mission. It highlights our capabilities in software engineering, development, and modernization, and reinforces our position as a trusted partner in advancing mission outcomes. Our highly skilled technology professionals will deliver modeling and application analysis to help enable mission execution, further strengthening our role in supporting national security objectives. I'm proud of the progress we've made overcoming barriers that make expanding in this business area challenging. We believe that recent directives emphasizing speed, outcomes, access to commercial tech, and streamlining contracting fit our strategic offerings well. In support of this strategy, we're expanding our participation in other transaction authorities, or OTAs, which the Department of War increasingly favors as a faster and more flexible acquisition path. Collectively, we believe these actions suggest an evolution in contracting that will accommodate newer entrants like Maximus and support longer-term defense and national security policy objectives. In further support of this strategy, We've formed and are investing in our first Cooperative Research and Development Agreement, or CRADA, providing a mechanism for developing, maturing, and retaining Maximus intellectual property through collaboration with the Department of War. This agreement supports hosting of recurring hackathon events, capability demonstrations, and technology experiments in a Maximus-operated, sensitive, compartmented information facility, or SCIF. This CRADA positions Maximus closer to the men and women in uniform that conduct global operations for the department and positions Maximus at the center of advanced research and development. These activities align directly with the department's evolving acquisition strategies for rapid prototyping, IT, and modernization. Recent commentary from department leadership has signaled a desire for greater investment by the industry. While this may present challenges for some competitors, Maximus is actively demonstrating on-contract innovation as part of our technology-forward strategy. More than four months on, the landscape around the One Big Beautiful Bill Act remains largely unchanged, but the priorities it established continue to be front and center for our state customers within our U.S. services segment. The legislation creates meaningful opportunities for Maximus in both Medicaid and SNAP, and we remain actively engaged with clients to prepare for the requirements ahead. On Medicaid, the administration continues its focus on managing federal spend, with new rules requiring twice-yearly eligibility determinations for the expansion population and codifying work requirements beginning in early 2027. States must review and adjust their processes to comply, and our U.S. services team is working closely with clients to ensure readiness. As we noted previously, we believe Maxness is well positioned as a conflict-free partner to support these compliance efforts, having done so for similar requirements in TANF and SNAP for almost 30 years. While the Medicaid changes are significant, states' foremost priority at the moment, based on active discussions, is around SNAP. The budget implications of the new payment accuracy requirements are far greater, as states with higher payment error rates will be required to absorb more of the program's expense. This shift is driving strong interest in technology-led solutions that can improve efficiency and payment accuracy. As I mentioned on the last call, Maximus already has an expanded role with a long-standing state customer, and we expect SNAP to remain a focal point of engagement given potential state budget implications. Although the policy environment has not materially shifted since our last call, these initiatives continue to be priorities for our customers. In our view, are the right partner to help states navigate the changes, mitigate risk, and deliver high-quality outcomes across both SNAP and Medicaid. I'll close my discussion of strategic priorities with AI, where Maximus is proud to be a leader for government customers in this unprecedented era, demonstrating the art of the possible in transforming public service delivery. Our role is not only to provide solutions, but to show what is achievable when innovation is combined with decades of deep program knowledge, policy experience, and operational data. By embedding AI directly into our business processes, we are enabling customers to benefit from advanced automation, AI-powered quality monitoring, and real-time insights. These capabilities are helping agencies operate more efficiently, make better decisions, and deliver improved outcomes for the people they serve. We have already successfully deployed AI-driven tools across enterprise programs where these solutions have accelerated service delivery, strengthened compliance, and enhanced customer satisfaction. In addition to our AI-powered TXM solution I mentioned earlier, we're also serving as customer zero for our own large-scale deployments of AI solutions in ITSM, or service management, and HR help desk support, as well as knowledge management. This first-to-deploy experience provides us with deep insights, enabling our solutions to be tested, refined, and proven before being extended to our customers. Maximus' AI guiding principles form a robust framework for responsible innovation, grounded in ethical governance, human-centric design, and mission-aligned outcomes. Our governance structure is designed to ensure that our innovation is both responsible and sustainable. Looking ahead, we have approximately 30 AI-related deployments, either planned or in process across Maximus. These initiatives vary in scale from small pilots to large enterprise implementations, with further full deployments expected in fiscal 2026. This pipeline reflects both the demand for AI-enabled solutions and our commitment to investing in the future of government services. Let me turn now to our award metrics and pipelines. For fiscal year 2025, signed awards totaled $4.7 billion of total contract value. Further, at September 30th, there were $331 million worth of contracts that had been awarded but not yet signed. These awards translate into a book-to-bill of approximately 0.9 times for the trailing 12-month period and reflects ongoing progress toward increasing this metric, a previously stated goal of ours. As a reminder, we continue to view book-to-bill as a relevant forward indicator to pipeline conversion over the broader horizon, but not the sole determinant of the business's ability to grow organically. Also, in periods of lower-than-normal rebid activity, which we've experienced recently, the TTM book-to-bill is expected to be below 1.0. Then, in periods of greater rebid activity, and given our larger contract lengths and values, the metric tends to show outsized performance. It's worth noting that the improvement to TTM book to bill of 0.9 was driven by more dramatic quarterly sequential improvement. The quarter ended September 30th book to bill was 1.0 times compared to 0.3 times for the June 30th quarter, a market improvement in the pipeline conversion of both recurring and new work. Our pipeline at September 30th was $51.3 billion compared to $44.7 billion reported in the third quarter of fiscal 2025. The September 30th pipeline is comprised of approximately $3.4 billion in proposals pending, $1.4 billion in proposals in preparation, and $46.6 billion in opportunities tracking. Of our total pipeline of sales opportunities, approximately 64% represents new work. Additionally, 66% of the $51.3 billion total pipeline is attributable to our U.S. Federal Services segment. In this latest pipeline view, U.S. services segment opportunities tied to the One Big Beautiful Bill Act remain in the development stage with potential revenue in fiscal 2027 and therefore are not yet captured in the pipeline. And with that, I'll turn the call over to David.