2007 Stockholders Meeting

2007 Stockholders Meeting

Bill Fairl

Operations Overview

Stockholders Speech

November 14, 2007

Thank you, Paul.

I’ll start by discussing some of our key operating metrics. Our highlights for fiscal year 2007 include the following:

CACI achieved a record level of contract awards, $3.3 billion. This was a 68 percent increase over contract awards received in FY06. We also experienced record contract funding orders of $2.16 billion, a 23 percent increase over FY06.

Our contract victories included the multibillion-dollar Eagle contract with the Department of Homeland Security, the $950 million Mega 3 litigation support recompete with the Department of Justice, andthe 20-year, $36 billion U.S. Army Field and Installation Readiness Support Team, or Army FIRST, contract.

We also won more than $400 million in classified national security and intelligence work, and over $732 million in awards on the U.S. Army’s Strategic Services Sourcing, or S3, contract. Our intelligence business, and our business with the Army, were among the fastest-growing and highest-value areas of our business in FY07, and remain so today.

These record awardsare a direct result of our strong team andclose client relationships, our reputation for outstanding performance, and the technical excellence we bring to all we do.

Speaking of which, in FY07 we expanded our technical distinctions by becoming one of the first federal systems integrators to receive the ISO 20000 certification. ISO 20000 is a recognized standard for enhanced efficiency and cost-effectiveness in IT service management, and the federal government is beginning to embrace ISO 20000 as a key measure of contractor performance. Our certification gives us a significant discriminator in the federal IT services and solutions marketplace.

In addition, four of our operating units earned the Capability Maturity Model Integration, or CMMI, Maturity Level 3 rating in FY07. The Level 3 rating is an increasing requirement on large, complex federal contracts, so our accomplishment here keeps us very competitive.

I am also happy to report that just this month, one more operating unit achieved the Level 3 rating, and most notably, one of our entire business groups did as well. This business group represents multiple divisions and more than 1400 employees, and now every single project in that group is accredited. This is quite an achievement in our industry. I’ll also point out that this group does a great deal of work with our intelligence clients, so this distinction is sure to add even more momentum to the growth of our intelligence business.

CACI also sustained its role as a leading strategic consolidator in FY07. We completed two acquisitions, the Institute for Quality Management and the Wexford Group International, that had combined annual revenues of approximately $120 million. These teams enhance our support in the Intelligence Community and the Department of Defense. And though we made both these acquisitions with long-range goals in mind, I’m also pleased to tell you that our Wexford and IQM acquisitionsare already producing bottom-line gains for us.

Now I’ll go into a few more details.

For the full fiscal 2007 year, revenue increased 10.4 percent, to$1.94 billion.This is another record result.

Operating income for the year was $145.9 million compared with $150.3 million reported in FY06. We believe this is a temporary slowdown and we will see positive growth in the second half of FY08. Our entire management team is focused on this challenge.

In Europe, our United Kingdom operation reported revenue of $80.5 million, up 28 percent over FY06. This represents significant growth in both our government and commercial business in the U.K., and an expanded reach into new markets throughout Europe.I’d also like to mention that in July of this year, just after our fiscal year ended, our U.K. operation acquired Arete Software Limited, a proprietary software business focused primarily on local government. This is the U.K.’s third acquisition in the last 21 months.

Finally, at the end of FY07, we had more than $3.1 billion in submitted proposals under evaluation, both new and recompete. This points to a healthy book of business for us in FY08 and beyond.

As a matter of fact, we are seeing some of these returns in the financial results of the first quarter of FY08, which we completed on September 30. As Paul mentioned, our revenue for the first quarter was an all-time high of $554 million. That’s up 18.4 percent over the first quarter of FY07.

Our contract awards for the first quarter totaled $934 million, an increase of $30 million over the same quarter in FY07. This included another $190 million in S3 contracts this quarter, which now makes CACI the leading S3 prime contractor in the value of task orders awarded, with a total of approximately $975million in awards. That’s quite afeat, considering the Tier 1 competitors we’re up against in this arena!

Also in the first quarter, we won all our major recompetes, which was an important contributor to our positive organic growth for the quarter, and we won significant new business in both the defense and federal civilian sectors. In addition, our contract funding orders increased significantly, to $709 million, a 17 percent increase over the first quarter of FY07.

Our mergers and acquisitions program remained in high gear, too, as we reached agreements to acquire Athena Innovative Solutions and Dragon Development Corporation, and have since closed on both acquisitions. Both companies have strong growth records and good margins, and both provide critical services to the Intelligence Community.

Looking ahead to the rest of FY08, we are confident of continued growth and success.

We are strategically positioned in our markets, and offer valuable solutions for our customers’ highest priorities in defense, intelligence, homeland security, and the modernization of government services.

Our first-quarter record revenue, strong contract awards, record contract funding orders, and outstanding acquisitions have gotten us off to a great start in FY08. Our team is focused on maintaining our momentum through the remainder of this fiscal year, and beyond.

Paul, that completes my operations overview.

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