Cover
Cover - USD ($) | 12 Months Ended | ||
Sep. 30, 2022 | Dec. 05, 2022 | Mar. 31, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Sep. 30, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 0-18492 | ||
Entity Registrant Name | DLH HOLDINGS CORP. | ||
Entity Incorporation, State or Country Code | NJ | ||
Entity Tax Identification Number | 22-1899798 | ||
Entity Address, Address Line One | 3565 Piedmont Road, | ||
Entity Address, Address Line Two | Building 3, | ||
Entity Address, Address Line Three | Suite 700 | ||
Entity Address, City or Town | Atlanta, | ||
Entity Address, State or Province | GA | ||
Entity Address, Postal Zip Code | 30305 | ||
City Area Code | 770 | ||
Local Phone Number | 554-3545 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | DLHC | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 134,921,988 | ||
Entity Common Stock, Shares Outstanding | 13,047,279 | ||
Documents Incorporated by Reference | List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (e) under the Securities Act of 1933. Part III of this report incorporates information by reference from the Company's definitive proxy statement, which proxy statement is due to be filed with the Securities and Exchange Commission not later than 120 days after September 30, 2022. | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Central Index Key | 0000785557 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY |
Audit Information
Audit Information | 12 Months Ended |
Sep. 30, 2022 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 100 |
Auditor Name | WithumSmith+Brown, PC |
Auditor Location | East Brunswick, New Jersey |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||
Revenue | $ 395,173 | $ 246,094 |
Contract costs | 322,886 | 194,614 |
General and administrative costs | 30,730 | 25,054 |
Corporate development costs | 614 | 1,088 |
Depreciation and amortization | 7,665 | 8,115 |
Total operating costs | 361,895 | 228,871 |
Income from operations | 33,278 | 17,223 |
Interest expense | 2,215 | 3,784 |
Income before provision for income taxes | 31,063 | 13,439 |
Provision for income taxes | 7,775 | 3,294 |
Net income | $ 23,288 | $ 10,145 |
Earnings Per Share [Abstract] | ||
Net income per share - basic (in dollars per share) | $ 1.82 | $ 0.81 |
Net income per share - diluted (in dollars per share) | $ 1.64 | $ 0.75 |
Weighted average common shares outstanding | ||
Basic (in shares) | 12,830 | 12,549 |
Diluted (in shares) | 14,179 | 13,597 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Current assets: | ||
Cash | $ 228 | $ 24,051 |
Accounts receivable | 40,496 | 33,447 |
Other current assets | 2,878 | 4,265 |
Total current assets | 43,602 | 61,763 |
Equipment and improvements, net | 1,704 | 1,912 |
Operating lease right-of-use assets | 16,851 | 19,919 |
Goodwill | 65,643 | 65,643 |
Intangible assets, net | 40,884 | 47,469 |
Other long-term assets | 328 | 464 |
Total assets | 169,012 | 197,170 |
Current liabilities: | ||
Operating lease liabilities - current | 2,235 | 2,261 |
Accrued payroll | 9,444 | 9,125 |
Deferred revenue | 0 | 22,273 |
Accounts payable and accrued liabilities | 26,862 | 32,717 |
Total current liabilities | 38,541 | 66,376 |
Deferred taxes, net | 1,534 | 1,176 |
Operating lease liabilities - long-term | 16,461 | 19,374 |
Long-term portion of debt obligations, net of deferred financing costs | 20,416 | 44,636 |
Total long-term liabilities | 38,411 | 65,186 |
Total liabilities | 76,952 | 131,562 |
Shareholders' equity: | ||
Common stock, $0.001 par value; authorized 40,000 shares; issued and outstanding 13,047 and 12,714 at September 30, 2022 and 2021, respectively | 13 | 13 |
Additional paid-in capital | 91,057 | 87,893 |
Retained earnings (accumulated deficit) | 990 | (22,298) |
Total shareholders’ equity | 92,060 | 65,608 |
Total liabilities and shareholders' equity | $ 169,012 | $ 197,170 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares (in shares) | 40,000 | 40,000 |
Common stock, issued shares (in shares) | 13,047 | 13,047 |
Beginning balance (in shares) | 12,714 | 12,714 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating activities | ||
Net income | $ 23,288 | $ 10,145 |
Depreciation and amortization | 7,665 | 8,115 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of deferred financing costs charged to interest expense | 664 | 792 |
Stock-based compensation expense | 2,608 | 1,660 |
Deferred taxes, net | 358 | 1,213 |
Changes in operating assets and liabilities | ||
Accounts receivable | (7,049) | (906) |
Other current assets | 1,387 | (766) |
Accrued payroll | 319 | (1,486) |
Deferred revenue | (22,273) | 22,273 |
Accounts payable and accrued liabilities | (5,855) | 4,139 |
Other long-term assets and liabilities | 131 | 486 |
Net cash provided by operating activities | 1,243 | 45,665 |
Investing activities | ||
Business acquisition adjustment | 0 | 59 |
Purchase of equipment and improvements | (872) | (103) |
Net cash used in investing activities | (872) | (44) |
Financing activities | ||
Proceeds from debt obligations | 17,000 | 30,950 |
Repayments of debt obligations | (41,750) | (54,200) |
Payments of deferred financing costs | 0 | (43) |
Proceeds from issuance of common stock upon exercise of options and warrants | 837 | 366 |
Payment of tax obligations resulting from net exercise of stock options | (281) | 0 |
Net cash used in financing activities | (24,194) | (22,927) |
Net change in cash | (23,823) | 22,694 |
Cash - beginning of year | 24,051 | 1,357 |
Cash - end of year | 228 | 24,051 |
Supplemental disclosures of cash flow information | ||
Cash paid during the year for interest | 1,528 | 2,941 |
Cash paid during the year for income taxes | 9,282 | 936 |
Supplemental disclosures of non-cash activity | ||
Common stock surrendered for the exercise of stock options | 256 | 0 |
Cancellation of common stock | $ 0 | $ 68 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) |
Beginning Balance (in shares) at Sep. 30, 2020 | 12,404 | |||
Beginning Balance at Sep. 30, 2020 | $ 53,437 | $ 12 | $ 85,868 | $ (32,443) |
Expense related to director restricted stock unit (shares) | 141 | |||
Expense related to director restricted stock units | 467 | 467 | ||
Expense related to employee stock options | 1,193 | 1,193 | ||
Exercise of stock options (shares) | 175 | |||
Exercise of stock options | 434 | $ 1 | 433 | |
Net income | 10,145 | 10,145 | ||
Cancellation of common stock (in shares) | (6) | |||
Cancellation of common stock | $ (68) | (68) | ||
Ending Balance (in shares) at Sep. 30, 2021 | 12,714 | 12,714 | ||
Ending Balance at Sep. 30, 2021 | $ 65,608 | $ 13 | 87,893 | (22,298) |
Expense related to director restricted stock unit (shares) | 0 | |||
Expense related to director restricted stock units | 648 | 648 | ||
Expense related to employee stock options | 1,960 | 1,960 | ||
Stock issued for director restricted stock units (in shares) | 53 | |||
Stock issued for director restricted stock units | $ 0 | |||
Exercise of stock options (shares) | 257 | 257 | ||
Exercise of stock options | $ 637 | $ 0 | 637 | |
Common stock surrendered for the exercise of stock options (in shares) | (31) | |||
Common stock surrendered for the exercise of stock options | (281) | (281) | ||
Exercise of stock warrants (in shares) | 54 | |||
Exercise of stock warrants | 200 | 200 | ||
Net income | $ 23,288 | 23,288 | ||
Ending Balance (in shares) at Sep. 30, 2022 | 12,714 | 13,047 | ||
Ending Balance at Sep. 30, 2022 | $ 92,060 | $ 13 | $ 91,057 | $ 990 |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation and Principles of ConsolidationThe accompanying consolidated financial statements include the accounts of DLH Holdings Corp. and its subsidiaries (together with its subsidiaries, "DLH" or the "Company" and also referred to as "we," "us," and "our"), all of which are wholly-owned. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and with the instructions to Form 10-K, Regulation S-X, and Regulation S-K. Certain amounts reported in our prior year consolidated financial statements have been reclassified to conform to current year presentation. |
New Accounting Pronouncements
New Accounting Pronouncements | 12 Months Ended |
Sep. 30, 2022 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In March 2020 and January 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” and ASU No. 2021-01, “Reference Rate Reform (Topic 848): Scope,” respectively (collectively, “Topic 848”). Topic 848 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. The optional expedients and exceptions provided by Topic 848 can be applied for all entities as of March 12, 2020 through December 31, 2022. The Company is currently assessing the impact of electing this standard on its consolidated financial statements and related disclosures and does not expect the impact to be material. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. The most significant of these estimates and assumptions relate to estimating revenues and costs including overhead and its allocation, estimating progress toward the completion of performance obligations, assessing fair value of acquired assets and liabilities accounted for through business acquisitions, valuing and determining the amortization periods for long-lived intangible assets, interest rate swaps, stock-based compensation, right-of-use assets and leases liabilities, and loss development on workers' compensation claims. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current and expected future outcomes, third-party evaluations, and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. We revise material accounting estimates if changes occur, such as more experience is acquired, additional information is obtained, or there is new information on which an estimate was or can be based. Actual results could differ from those estimates. Revenue The Company's revenues from contracts with customers are derived from offerings that include technology-enabled business process outsourcing, program management solutions, and public health research and analytics, substantially within the U.S. government and its agencies, and to a lesser extent, subcontractors. The Company has various types of contracts of which include time-and-materials contracts, cost-reimbursable contracts, and firm-fixed-price contracts. We consider a contract with a customer to exist when there is a commitment by both parties (customer and Company), payment terms are determinable, there is commercial substance, and collectability is probably in accordance with Accounting Standards Codification ("ASC") No. 606, Revenue from Contracts with Customers ("Topic 606"). We recognize revenue over time when there is a continuous transfer of control to our customer as performance obligations are satisfied. For our U.S. government contracts, this continuous transfer of control to the customer is transferred over time and revenue is recognized based on the extent of progress toward completion of the performance obligation. We consider control to transfer when we have a right to payment. In some instances, the Company commences providing services prior to formal approval to begin work from the customer. The Company considers these factors, the risks associated with commencing work, and legal enforceability in determining whether a contract exists under Topic 606. Contract modification can occur throughout the life of the contract and can affect the transaction price, extend the period of performance, adjust funding, or create new performance obligations. We review each modification to assess the impact of these contract changes to determine if it should be treated as part of the original performance obligation or as a separate contract. Contract modifications impact performance obligations when the modification either creates new or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue and profit cumulatively. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. For service contracts, we satisfy our performance obligations as services are rendered. We use cost-based input and time-based output methods to measure progress based on the contract type. • Time and material - We bill the customer per labor hour and per material, and revenue is recognized in the amount invoiced as the amount corresponds directly to the value of our performance to date. Revenue is recognized to the extent of billable rates times hours delivered plus materials and other reimbursable costs incurred. • Cost reimbursable - We record reimbursable costs as incurred, including an estimated share of the contractual fee earned. • Firm fixed price - We recognize revenue over time using a straight-line measure of progress or percentage of completion method whereby progress toward completion is based on a comparison of actual costs incurred to total estimated costs to be incurred over the contract terms. Contract costs generally include direct costs such as labor, materials, subcontract costs, and indirect costs identifiable with or allocable to a specific contract. Costs are expensed as incurred and include an estimate of the contractual fees earned. Contract costs incurred for U.S. government contracts, including indirect costs, are subject to audit and adjustment by various government audit agencies. Historically, our adjustments have not been material. Contract assets - Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms. In part, revenue recognition occurs before we have the right to bill, resulting in contract assets. These contract assets are reported within Accounts receivable, net on our consolidated balance sheets and are invoiced in accordance with payment terms defined in each contract. Period end balances will vary from period to period due to agreed-upon contractual terms. Contract liabilities - Amounts are a result of billings in excess of costs incurred or prepayment for services to be rendered. Contract liabilities are primarily due to contract start-up funding provided under a contract awarded at the end of the fiscal year 2021, for which all performance obligations were completed by March 31, 2022. Fair Value of Financial Instruments The carrying amounts of the Company's cash and cash equivalents, accounts receivable, contract assets, accrued expenses, and accounts payable approximate fair value due to the short-term nature of these instruments. The fair values of the Company's debt instruments approximate fair value because the underlying interest rates approximate market rates that the Company could obtain for similar instruments at the balance sheet dates. Long-lived Assets Our long-lived assets include equipment and improvements, intangible assets, right-of-use assets, and goodwill. The Company continues to review its long-lived assets for possible impairment or loss of value at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. Equipment and improvements are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives (3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Intangible assets (other than goodwill) are originally recorded at fair value and are amortized on a straight-line basis over their estimated useful lives of 10 years. Maintenance and repair costs are expensed as incurred. Right-of-use assets are measured at the present value of future minimum lease payments, including all probable renewals, plus lease payments made to the lessor before or at lease commencement and indirect costs paid, less incentives received. Our right-of-use assets include long-term leases for facilities and equipment and are amortized over their respective lease terms. Our right-of-use-assets are recognized as the present value of the future minimum lease payments over the lease term less unamortized lease incentives and the balance remaining in deferred rent liability under ASC 840. Lease Liabilities We have leases for facilities and office equipment. Our lease liabilities are recognized as the present value of the future minimum lease payments over the lease term. Our lease payments consist of fixed and in-substance fixed amounts attributable to the use of the underlying asset over the lease term. Variable lease payments that do not depend on an index rate or are not in-substance fixed payments are excluded in the measurement of right-of-use assets and lease liabilities and are expensed in the period incurred. The incremental borrowing rate on our secured term loan is used in determining the present value of future minimum lease payments. Some of our lease agreements include options to extend the lease term or terminate the lease. These options are accounted for in our right-of-use assets and lease liabilities when it is reasonably certain that the Company will extend the lease term or terminate the lease. The Company does not have any finance leases. As of September 30, 2022, operating leases for facilities and equipment have remaining lease terms of 0.2 to 8.5 years. Goodwill At September 30, 2022, we performed an internal goodwill impairment evaluation on the year-end carrying value of approximately $65.6 million. We performed a qualitative assessment of factors to determine whether it was necessary to perform the goodwill impairment test. Based on the results of the work performed, the Company has concluded that no impairment loss was warranted at September 30, 2022, as no change in business conditions occurred which would have a material adverse effect on the valuation of goodwill. Our assessment incorporated effects of the COVID-19 pandemic, which is not expected to have a meaningful impact on our financial results. Notwithstanding this evaluation, factors including non-renewal of a major contract or other substantial changes in business conditions could have a material adverse effect on the valuation of goodwill in future periods and the resulting charge could be material to future periods’ results of operations. Similarly, there were no impairments during the prior year ended September 30, 2021. Provision for Income Taxes The Company accounts for income taxes in accordance with the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the consolidated balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits, it is more-likely-than-not that the position will be sustained upon examination. We had no uncertain tax positions at either September 30, 2022 and 2021. We report interest and penalties as a component of provision for income taxes. For the years ended September 30, 2022 and 2021, we recognized no interest and no penalties related to income taxes. Stock-based Equity Compensation The Company uses the fair value-based method for stock-based equity compensation. Options issued are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued common shares. All awards to employees and non-employees are recorded at fair value on the date of the grant and expensed over the period of vesting. The Company uses a Monte Carlo method to estimate the fair value of each stock option at the date of grant. Any consideration paid by the option holders to purchase shares is credited to capital stock. Compensation Expense Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance. For options that vest based on the Company’s common stock achieving and maintaining defined market prices, the Company values the awards with a Monte Carlo method that utilizes various probability factors and other criterion in establishing fair value of the grant. The related compensation expense is recognized over the service period. Cash and Cash Equivalents We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. Deposits held with financial institutions may exceed the $250,000 limit. Receivables Receivables include amounts billed and currently due from customers where the right to consideration is unconditional and amounts unbilled. Both billed and unbilled amounts are non-interest bearing, unsecured, and recognized at an estimated realizable value that include costs and fees, and are generally expected to be billed and received within a single year. We evaluate our receivables on a quarterly basis and determine whether an allowance is appropriate based on specific collection issues. No allowance for doubtful accounts was deemed necessary at either September 30, 2022 or September 30, 2021. Earnings per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common stock outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method. Treasury Stock The Company periodically purchases its own common stock that is traded on public markets as part of announced stock repurchase programs. The repurchased common stock is classified as treasury stock on the consolidated balance sheets and held at cost. As of September 30, 2022 and 2021, the Company did not hold any treasury stock. Preferred Stock Our certificate of incorporation authorizes the issuance of "blank check" preferred stock with such designations, rights and preferences as may be determined from time to time by our board of directors up to an aggregate of 5,000,000 shares of preferred stock. As of September 30, 2022 and 2021, the Company has not issued any preferred stock. Interest Rate Swap The Company uses derivative financial instruments to manage interest rate risk associated with its variable debt. The Company's objective in using these interest rate derivatives is to manage its exposure to interest rate movements and reduce volatility of interest expense. The gains and losses due to changes in the fair value of the interest rate swap agreements completely offset changes in the fair value of the hedged portion of the underlying debt. Offsetting changes in fair value of both the interest rate swaps and the hedged portion of the underlying debt are recognized in interest expense in the consolidated statements of operations. The Company does not hold or issue any derivative instrument for trading or speculative purposes. Risks & Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s consolidated financial position and the results of its operations, the specific impact is not readily determinable as of the date of these consolidated financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The following table summarizes the contract balances recognized within the Company's consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Contract assets $ 7,682 $ 7,307 Contract liabilities $ — $ 22,473 Disaggregation of revenue from contracts with customers We disaggregate our revenue from contracts with customers by customer, contract type, as well as whether the Company acts as prime contractor or subcontractor. We believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. The following series of tables presents our revenue disaggregated by these categories: Revenue by customer for the years ended September 30, 2022 and 2021 (in thousands): 2022 2021 Department of Homeland Security $ 126,576 $ 2,485 Department of Veterans Affairs 126,106 110,078 Department of Health and Human Services 102,201 91,543 Department of Defense 33,612 30,930 Other 6,678 11,058 Total Revenue $ 395,173 $ 246,094 Revenue by contract type for the years ended September 30, 2022 and 2021 (in thousands): 2022 2021 Time and Materials $ 308,944 $ 185,656 Cost Reimbursable 46,231 48,101 Firm Fixed Price 39,998 12,337 Total Revenue $ 395,173 $ 246,094 Revenue by whether the Company acts as a prime contractor or a subcontractor for the years ended September 30, 2022 and 2021(in thousands): 2022 2021 Prime Contractor $ 366,571 $ 215,241 Subcontractor 28,602 30,853 Total Revenue $ 395,173 $ 246,094 |
Leases
Leases | 12 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Leases | Leases The following table summarizes lease balances presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Operating lease right-of-use assets $ 16,851 $ 19,919 Operating lease liabilities, current $ 2,235 $ 2,261 Operating lease liabilities, long-term 16,461 19,374 Total operating lease liabilities $ 18,696 $ 21,635 For the years ended September 30, 2022 and 2021, total lease costs for our operating leases are as follows (in thousands): 2022 2021 Operating $ 3,548 $ 3,653 Short-term 114 103 Variable 120 81 Sublease income (a) (258) (302) Total lease costs $ 3,524 $ 3,535 (a): The Company subleases a portion of one of its leased facilities. The sublease is classified as an operating lease with respect to the underlying asset. The sublease term is 5 years and includes two additional 1 year term extension options. The Company's future minimum lease payments as of September 30, 2022 are as follows: For the Fiscal Year Ending September 30, (in thousands) 2023 $ 3,299 2024 3,156 2025 2,995 2026 3,092 2027 2,487 Thereafter 8,513 Total future minimum lease payments 23,542 Less: imputed interest (4,846) Present value of future minimum lease payments 18,696 Less: current portion of operating lease liabilities (2,235) Long-term operating lease liabilities $ 16,461 At September 30, 2022, the weighted-average remaining lease term and weighted-average discount rate are 7.5 years and 6.0%, respectively. The calculation of the weighted-average discount rate was determined based on borrowing terms from our secured term loan. Other information related to our leases is as follows for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Cash paid for amounts included in the measurement of lease liabilities $ 3,411 $ 3,306 |
Supporting Financial Informatio
Supporting Financial Information | 12 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supporting Financial Information | Supporting Financial Information Accounts receivable The following table summarizes Accounts receivable presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Billed receivables $ 32,814 $ 26,140 Contract assets 7,682 7,307 Allowance for doubtful accounts — — Accounts receivable $ 40,496 $ 33,447 Other current assets The following table summarizes Other current assets presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Prepaid insurance and benefits $ 737 $ 655 Other receivables 945 995 Prepaid expenses 1,196 2,615 Other current assets $ 2,878 $ 4,265 Equipment and improvements, net The following table summarizes Equipment and improvements, net presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Furniture and equipment $ 893 $ 958 Computer equipment 2,316 1,262 Computer software 4,407 4,353 Leasehold improvements 1,614 1,595 Total equipment and improvements 9,230 8,168 Less: accumulated depreciation and amortization (7,526) (6,256) Equipment and improvements, net $ 1,704 $ 1,912 Depreciation and amortization was $1.1 million and $1.5 million for the years ended September 30, 2022 and 2021, respectively. Intangible assets, net The following table summarizes Intangible assets, net presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Intangible assets Customer contracts and related customer relationships $ 62,281 $ 62,281 Covenants-not-to-compete 522 522 Trade names 3,051 3,051 Total intangible assets 65,854 65,854 Less accumulated amortization Customer contracts and related customer relationships (23,606) (17,378) Covenants-not-to-compete (316) (264) Trade names (1,048) (743) Total accumulated amortization (24,970) (18,385) Intangible assets, net $ 40,884 $ 47,469 Total amount of amortization expense for each of the years ended September 30, 2022 and 2021 was $6.6 million. As of September 30, 2022, the estimated annual amortization expense is as follows: For the Fiscal Year Ending September 30, (in thousands) 2023 $ 6,585 2024 6,585 2025 6,585 2026 5,851 2027 4,823 Thereafter 10,455 Total amortization expense $ 40,884 Accounts payable and accrued liabilities The following table summarizes Accounts payable and accrued liabilities presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Accounts payable $ 11,886 $ 16,684 Accrued benefits 3,857 2,916 Accrued bonus and incentive compensation 3,625 2,381 Accrued workers' compensation insurance 4,880 7,014 Other accrued expenses 2,614 3,722 Accounts payable and accrued liabilities $ 26,862 $ 32,717 Debt obligations The following table summarizes Debt obligations presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Secured term loan $ 22,000 $ 46,750 Less: unamortized deferred financing costs (1,584) (2,114) Long-term portion of debt obligations, net of deferred financing costs $ 20,416 $ 44,636 As of September 30, 2022 and 2021, we had no outstanding balance on our secured revolving line of credit and have satisfied mandatory principal payments on our secured term loan for the next twelve months. Interest expense The following table summarizes Interest expense presented on our consolidated statements of operations for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Interest expense (a) $ 1,551 $ 2,992 Amortization of deferred financing costs (b) 664 792 Interest expense $ 2,215 $ 3,784 (a): Interest expense on borrowing |
Credit Facilities
Credit Facilities | 12 Months Ended |
Sep. 30, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Credit Facilities | Credit Facilities A summary of our credit facilities as of September 30, 2022 and 2021 is as follows (in millions): 2022 2021 Arrangement Loan Balance Interest Loan Balance Interest Secured term loan (a) due September 30, 2025 $ 22.0 LIBOR* + 2.5% $ 46.8 LIBOR* + 3.5% Secured revolving line of credit (b) due September 30, 2025 $ — LIBOR* + 2.5% $ — LIBOR* + 3.5% *LIBOR rate as of September 30, 2022 and 2021 was 2.52% and 0.08%, respectively. As of September 30, 2022 and 2021, our LIBOR rate is subject to a minimum floor of 0.5%. (a) Represents the principal amounts payable on our secured term loan, which is secured by liens on substantially all of the assets of the Company. The principal of the secured term loan is payable in quarterly installments with the remaining balance due on September 30, 2025. The Credit Agreement requires compliance with a number of financial covenants and contains restrictions on our ability to engage in certain transactions. Among other matters, we must comply with limitations on: granting liens; incurring other indebtedness; maintenance of assets; investments in other entities and extensions of credit; mergers and consolidations; and changes in nature of business. The loan agreement also requires us to comply with certain quarterly financial covenants including: (i) a minimum fixed charge coverage ratio of at least 1.25 to 1.00, and (ii) a Funded Indebtedness to Adjusted EBITDA ratio not exceeding the ratio of 3.75:1.0 to 2.75:1.0 through maturity. Adjusted EBITDA ratio is calculated by dividing the Company's total interest-bearing debt by net income adjusted to exclude (i) interest and other expenses, (ii) provision for or benefit from income taxes, if any, (iii) depreciation and amortization, and (iv) non-recurring charges, losses or expenses to include transaction and non-cash equity expense. The secured term loan has an interest rate spread range from 2.5% to 4.5% depending on the funded indebtedness to adjusted EBITDA ratio. We are in compliance with all loan covenants and restrictions. We are required to pay quarterly amortization payments commencing in December 2020 through September 2025. The annual amortization amounts are $7.0 million each for fiscal years 2021 and 2022 and $8.75 million each for fiscal years 2023 through 2025, with the remaining unpaid loan balance due at maturity in September 2025. The quarterly payments are in equal installments. As of September 30, 2022, the Company made voluntary prepayments of $34.0 million, bringing the total amount paid on the secured term loan to $48.0 million. As of September 30, 2022, we have satisfied mandatory principal amortization until September 30, 2025. In addition to quarterly payments of the outstanding indebtedness, the loan agreement also requires annual payments of a percentage of excess cash flow, as defined in the loan agreement. The loan agreement states that an excess cash flow recapture payment must be made equal to (a) 75% of the excess cash flow for the immediately preceding fiscal year in which indebtedness to consolidated EBITDA ratio is greater than or equal to 2.50:1.0; (b) 50% of the excess cash flow for the immediately preceding fiscal year in which the funded indebtedness to consolidated EBITDA Ratio is less than 2.50:1.0 but greater than or equal to 1.5:1.0; or (c) 0% of the excess cash flow for the immediately preceding fiscal year in which the funded indebtedness to consolidated EBITDA Ratio is less than 1.5:1.0. In addition, the Company must make additional mandatory prepayment of amounts outstanding based on proceeds received from asset sales and sales of certain equity securities or other indebtedness. Due to the voluntary prepayment of term debt, there was no excess cash flow payment required. For additional information regarding the schedule of future payment obligations, please refer to Note 10 Commitments and Contingencies . On September 30, 2019, we executed a floating-to-fixed interest rate swap with First National Bank ("FNB") as counter party. The notional amount in the floating-to-fixed interest rate swap on September 30, 2022 is $16.2 million and matures in 2024. The remaining outstanding balance of our secured term loan is subject to interest rate fluctuations and the minimum LIBOR floor. On the notional amount, the Company pays a base fixed rate of 1.61%, plus applicable credit spread. As a result, for the year ended September 30, 2022, interest expense increased by approximately $0.2 million. (b) The secured revolving line of credit has a ceiling of up to $25.0 million; as of September 30, 2022, we had unused borrowing capacity of $23.0 million, which is net of outstanding letters of credit. Borrowing on the secured revolving line of credit is secured by liens on substantially all of the assets of the Company. The Company accessed funds from the secured revolving line of credit during the year, but has no outstanding balance at September 30, 2022. The Company's total borrowing availability, based on eligible accounts receivables at September 30, 2022, was $25.0 million. As part of the secured revolving line of credit, the lenders agreed to a sublimit of $5 million for letters of credit for the account of the Company, subject to applicable procedures. |
Stock-based Compensation and Eq
Stock-based Compensation and Equity Grants | 12 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation and Equity Grants | Stock-based Compensation and Equity Grants Stock-based compensation expense Options issued under equity incentive plans were designated as either an incentive stock or a non-statutory stock option. No option was granted with a term of more than 10 years from the date of grant. Exercisability of option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued shares. As of September 30, 2022, there were 1.4 million shares available for grant. Stock-based compensation expense, presented in the table below, is recorded in general and administrative expenses included in our consolidated statements of operations for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 DLH employees (a) $ 1,960 $ 1,193 Non-employee directors (b) 648 467 Total stock option expense $ 2,608 $ 1,660 (a): Included in this amount are equity grants of restricted stock units to Named Executive Officers ("NEO"), which were issued in accordance with the DLH long-term incentive compensation policy, and stock option grants to NEO and non-NEO company employees. The restricted stock units totaled 140,404 restricted stock units issued and outstanding at September 30, 2022. (b): In the first quarter of fiscal year 2022, we issued 53,510 restricted stock units to the Company's non-employee directors, all of which vested as of September 30, 2022. The shares of common stock underlying such restricted stock units were issued on September 30, 2022. Unrecognized stock-based compensation expense Unrecognized stock-based compensation expense is presented in the table below for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Unrecognized expense for DLH employees (a) $ 5,214 $ 4,468 (a): On a weighted average basis, this expense is expected to be recognized within the next 4.20 years. Stock option activity for the year ended September 30, 2022: The aggregate intrinsic value in the table below represents the total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their in the money options on those dates. This amount will change based on the fair market value of the Company’s stock. (in years) Weighted Weighted Average (in thousands) (in thousands) Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Term Value Options outstanding, September 30, 2021 2,374 $ 5.60 5.6 $ 15,899 Granted (a) 275 16.17 — — Exercised (257) 3.47 — — Options outstanding, September 30, 2022 2,392 $ 7.05 5.4 $ 13,566 (a): Utilizing a volatility of 50% along with assumptions of a 10-year term and the aforementioned 10-day stock price threshold results in an indicated range of value of the options granted during the year ended September 30, 2022, as follows using the Monte Carlo method: Vesting Expected Strike Stock Threshold Term Calculated Grant Date Price Price Price (Years) Fair Value November 8, 2021 $ 16.01 $ 16.01 Service 10 $ 9.68 November 8, 2021 $ 16.01 $ 16.01 $ 24.00 10 $ 9.68 November 8, 2021 $ 16.01 $ 16.01 $ 28.00 10 $ 9.64 November 8, 2021 $ 16.01 $ 16.01 $ 32.00 10 $ 9.58 August 1, 2022 $ 17.77 $ 17.77 $ 23.00 10 $ 9.68 Notes: Results based on 100,000 simulations Stock options shares outstanding, vested and unvested for the years ended September 30, 2022 and 2021 (in thousands): Number of Shares 2022 2021 Vested and exercisable (a) 2,117 1,662 Unvested (b) 275 712 Options outstanding 2,392 2,374 (a): Weighted average exercise price of vested and exercisable shares was $5.86 and $3.91 at September 30, 2022 and 2021, respectively. Aggregate intrinsic value was approximately $13.6 million and $13.9 million at September 30, 2022 and 2021, respectively. Weighted average contractual term remaining was 4.9 years and 4.0 years at September 30, 2022 and 2021, respectively. (b): Certain awards vest upon satisfaction of certain performance criteria. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common shares outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method. Earnings Per Share information is presented in the table below for the years ending September 30, 2022 and 2021 (in thousands except for per share amounts): 2022 2021 Numerator: Net income $ 23,288 $ 10,145 Denominator: Denominator for basic net income per share - weighted-average outstanding shares 12,830 12,549 Effect of dilutive securities: Stock options and restricted stock 1,349 1,048 Denominator for diluted net income per share - weighted-average outstanding shares 14,179 13,597 Net income per share - basic $ 1.82 $ 0.81 Net income per share - diluted $ 1.64 $ 0.75 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Contractual Obligations as of September 30, 2022 (in thousands): Payments Due Per Fiscal Year Total 2023 2024 2025 2026 2027 Thereafter Debt obligations $ 22,000 $ — $ — $ 22,000 $ — $ — $ — Facility operating leases 23,407 3,216 3,104 2,995 3,092 2,487 8,513 Equipment operating leases 135 83 52 — — — — Total contractual obligations $ 45,542 $ 3,299 $ 3,156 $ 24,995 $ 3,092 $ 2,487 $ 8,513 Workers' Compensation We accrue workers' compensation expense based on claims submitted, applying actuarial loss development factors to estimate the costs incurred but not yet recorded. Our accrued liability for claims development as of September 30, 2022 and September 30, 2021 was approximately $4.9 million and $7.0 million, respectively. Legal Proceedings As a commercial enterprise and employer, the Company is subject to various claims and legal actions in the ordinary course of business. These matters can include professional liability, employment-relations issues, workers’ compensation, tax, payroll and employee-related matters, other commercial disputes arising in the course of its business, and inquiries and investigations by governmental agencies regarding our employment practices or other matters. The Company is not aware of any pending or threatened litigation that it believes is reasonably likely to have a material adverse effect on its results of operations, financial position or cash flows. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsThe Company has determined that for the years ended September 30, 2022 and 2021 and through the filing date of this report, there were no significant related party transactions that have occurred which require disclosure through the date that these consolidated financial statements were issued. |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The significant components of provision for income taxes from continuing operations are summarized as follows for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Current expense $ 7,351 $ 2,081 Deferred expense 424 1,213 Total expense $ 7,775 $ 3,294 The following table presents the significant differences between our income taxes at the federal statutory rate and the Company's effective tax rate for continuing operations for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Income taxes at the federal statutory rate $ 6,523 $ 2,822 State taxes, net 1,158 376 Other permanent items 94 96 Total $ 7,775 $ 3,294 An analysis of the Company's deferred tax assets and liabilities at September 30, 2022 and 2021 is as follows (in thousands): 2022 2021 Deferred tax assets: Net operating loss carry forwards, net $ 296 $ 318 Stock based compensation 668 508 Accrued compensation 2,108 2,614 Total deferred tax assets 3,072 3,440 Less: valuation allowance (262) (288) Total deferred tax assets, net 2,810 3,152 Deferred tax liabilities: Equipment and intangible assets (3,833) (3,507) Accrued expenses (407) (671) Right of use liability (104) (150) Total deferred tax liabilities (4,344) (4,328) Net deferred tax liability $ (1,534) $ (1,176) |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Sep. 30, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | Quarterly Financial Data (Unaudited) A summary of quarterly information is as follows (in thousands, except per share data) 2022 Quarters First a Second a Third a Fourth Revenue $ 152,801 $ 108,699 $ 66,440 $ 67,233 Income from operations 11,219 10,254 7,114 4,691 Interest expense (672) (554) (512) (477) Income before provision for income taxes 10,547 9,700 6,602 4,214 Provision for income taxes 2,743 2,522 1,738 772 Net income $ 7,804 $ 7,178 $ 4,864 $ 3,442 Earnings per share: Basic $ 0.61 $ 0.56 $ 0.38 $ 0.27 Diluted $ 0.55 $ 0.50 $ 0.34 $ 0.24 2021 Quarters First Second Third Fourth Revenue $ 57,852 $ 61,506 $ 61,555 $ 65,182 Income from operations 3,635 4,620 4,939 4,030 Interest expense (1,080) (1,004) (893) (808) Income before provision for income taxes 2,555 3,616 4,046 3,222 Provision for income taxes 741 1,049 1,166 339 Net income $ 1,814 $ 2,567 $ 2,880 $ 2,883 Earnings per share: Basic $ 0.15 $ 0.20 $ 0.23 $ 0.23 Diluted $ 0.13 $ 0.19 $ 0.21 $ 0.21 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Sep. 30, 2022 | |
Retirement Benefits [Abstract] | |
Employee Benefits Plans | Employee Benefit PlansAs of September 30, 2022, the Company maintains a 401(k) Plan (the "401(k) Plan"), a defined contribution and supplemental pension plan for the benefit of its eligible employees. The Company may provide a discretionary matching contribution of a participant's elective contributions under the 401(k) Plan. The Company recorded related expense of $2.2 million and $1.5 million for the years ending September 30, 2022 and 2021. Participants are always fully vested in their elective contributions and vests in Company matching contributions over a four-year period. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsManagement has evaluated subsequent events through the date that the Company's consolidated financial statements were issued. Based on this evaluation, the Company has determined that no further subsequent events have occurred which require disclosure through the date that these consolidated financial statements were issued. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation and Principles of ConsolidationThe accompanying consolidated financial statements include the accounts of DLH Holdings Corp. and its subsidiaries (together with its subsidiaries, "DLH" or the "Company" and also referred to as "we," "us," and "our"), all of which are wholly-owned. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and with the instructions to Form 10-K, Regulation S-X, and Regulation S-K. Certain amounts reported in our prior year consolidated financial statements have been reclassified to conform to current year presentation. |
New Accounting Pronouncements | New Accounting Pronouncements In March 2020 and January 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” and ASU No. 2021-01, “Reference Rate Reform (Topic 848): Scope,” respectively (collectively, “Topic 848”). Topic 848 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. The optional expedients and exceptions provided by Topic 848 can be applied for all entities as of March 12, 2020 through December 31, 2022. The Company is currently assessing the impact of electing this standard on its consolidated financial statements and related disclosures and does not expect the impact to be material. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. The most significant of these estimates and assumptions relate to estimating revenues and costs including overhead and its allocation, estimating progress toward the completion of performance obligations, assessing fair value of acquired assets and liabilities accounted for through business acquisitions, valuing and determining the amortization periods for long-lived intangible assets, interest rate swaps, stock-based compensation, right-of-use assets and leases liabilities, and loss development on workers' compensation claims. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current and expected future outcomes, third-party evaluations, and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. We revise material accounting estimates if changes occur, such as more experience is acquired, additional information is obtained, or there is new information on which an estimate was or can be based. Actual results could differ from those estimates. Revenue The Company's revenues from contracts with customers are derived from offerings that include technology-enabled business process outsourcing, program management solutions, and public health research and analytics, substantially within the U.S. government and its agencies, and to a lesser extent, subcontractors. The Company has various types of contracts of which include time-and-materials contracts, cost-reimbursable contracts, and firm-fixed-price contracts. We consider a contract with a customer to exist when there is a commitment by both parties (customer and Company), payment terms are determinable, there is commercial substance, and collectability is probably in accordance with Accounting Standards Codification ("ASC") No. 606, Revenue from Contracts with Customers ("Topic 606"). We recognize revenue over time when there is a continuous transfer of control to our customer as performance obligations are satisfied. For our U.S. government contracts, this continuous transfer of control to the customer is transferred over time and revenue is recognized based on the extent of progress toward completion of the performance obligation. We consider control to transfer when we have a right to payment. In some instances, the Company commences providing services prior to formal approval to begin work from the customer. The Company considers these factors, the risks associated with commencing work, and legal enforceability in determining whether a contract exists under Topic 606. Contract modification can occur throughout the life of the contract and can affect the transaction price, extend the period of performance, adjust funding, or create new performance obligations. We review each modification to assess the impact of these contract changes to determine if it should be treated as part of the original performance obligation or as a separate contract. Contract modifications impact performance obligations when the modification either creates new or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue and profit cumulatively. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. For service contracts, we satisfy our performance obligations as services are rendered. We use cost-based input and time-based output methods to measure progress based on the contract type. • Time and material - We bill the customer per labor hour and per material, and revenue is recognized in the amount invoiced as the amount corresponds directly to the value of our performance to date. Revenue is recognized to the extent of billable rates times hours delivered plus materials and other reimbursable costs incurred. • Cost reimbursable - We record reimbursable costs as incurred, including an estimated share of the contractual fee earned. • Firm fixed price - We recognize revenue over time using a straight-line measure of progress or percentage of completion method whereby progress toward completion is based on a comparison of actual costs incurred to total estimated costs to be incurred over the contract terms. Contract costs generally include direct costs such as labor, materials, subcontract costs, and indirect costs identifiable with or allocable to a specific contract. Costs are expensed as incurred and include an estimate of the contractual fees earned. Contract costs incurred for U.S. government contracts, including indirect costs, are subject to audit and adjustment by various government audit agencies. Historically, our adjustments have not been material. Contract assets - Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms. In part, revenue recognition occurs before we have the right to bill, resulting in contract assets. These contract assets are reported within Accounts receivable, net on our consolidated balance sheets and are invoiced in accordance with payment terms defined in each contract. Period end balances will vary from period to period due to agreed-upon contractual terms. Contract liabilities - Amounts are a result of billings in excess of costs incurred or prepayment for services to be rendered. Contract liabilities are primarily due to contract start-up funding provided under a contract awarded at the end of the fiscal year 2021, for which all performance obligations were completed by March 31, 2022. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of the Company's cash and cash equivalents, accounts receivable, contract assets, accrued expenses, and accounts payable approximate fair value due to the short-term nature of these instruments. The fair values of the Company's debt instruments approximate fair value because the underlying interest rates approximate market rates that the Company could obtain for similar instruments at the balance sheet dates. |
Long Lived Assets | Long-lived Assets Our long-lived assets include equipment and improvements, intangible assets, right-of-use assets, and goodwill. The Company continues to review its long-lived assets for possible impairment or loss of value at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. Equipment and improvements are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives (3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Intangible assets (other than goodwill) are originally recorded at fair value and are amortized on a straight-line basis over their estimated useful lives of 10 years. Maintenance and repair costs are expensed as incurred. |
Leases | Right-of-use assets are measured at the present value of future minimum lease payments, including all probable renewals, plus lease payments made to the lessor before or at lease commencement and indirect costs paid, less incentives received. Our right-of-use assets include long-term leases for facilities and equipment and are amortized over their respective lease terms. Our right-of-use-assets are recognized as the present value of the future minimum lease payments over the lease term less unamortized lease incentives and the balance remaining in deferred rent liability under ASC 840.Lease Liabilities We have leases for facilities and office equipment. Our lease liabilities are recognized as the present value of the future minimum lease payments |
Goodwill | GoodwillAt September 30, 2022, we performed an internal goodwill impairment evaluation on the year-end carrying value of approximately $65.6 million. We performed a qualitative assessment of factors to determine whether it was necessary to perform the goodwill impairment test. Based on the results of the work performed, the Company has concluded that no impairment loss was warranted at September 30, 2022, as no change in business conditions occurred which would have a material adverse effect on the valuation of goodwill. Our assessment incorporated effects of the COVID-19 pandemic, which is not expected to have a meaningful impact on our financial results. Notwithstanding this evaluation, factors including non-renewal of a major contract or other substantial changes in business conditions could have a material adverse effect on the valuation of goodwill in future periods and the resulting charge could be material to future periods’ results of operations. |
Income Taxes | Income TaxesThe Company accounts for income taxes in accordance with the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the consolidated balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax asset will not be realized. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits, it is more-likely-than-not that the position will be sustained upon examination. |
Share-based Equity Compensation | Stock-based Equity Compensation The Company uses the fair value-based method for stock-based equity compensation. Options issued are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued common shares. All awards to employees and non-employees are recorded at fair value on the date of the grant and expensed over the period of vesting. The Company uses a Monte Carlo method to estimate the fair value of each stock option at the date of grant. Any consideration paid by the option holders to purchase shares is credited to capital stock. Compensation Expense Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance. For options that vest based on the Company’s common stock achieving and maintaining defined market prices, the Company values the awards with a Monte Carlo method that utilizes various probability factors and other criterion in establishing fair value of the grant. The related compensation expense is recognized over the service period. |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. Deposits held with financial institutions may exceed the $250,000 limit. Receivables Receivables include amounts billed and currently due from customers where the right to consideration is unconditional and amounts unbilled. Both billed and unbilled amounts are non-interest bearing, unsecured, and recognized at an estimated realizable value that include costs and fees, and are generally expected to be billed and received within a single year. We evaluate our receivables on a quarterly basis and determine whether an allowance is appropriate based on specific collection issues. No allowance for doubtful accounts was deemed necessary at either September 30, 2022 or September 30, 2021. |
Earnings per Share | Earnings per ShareBasic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common stock outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method. |
Treasury Stock and Preferred Stock | Treasury Stock The Company periodically purchases its own common stock that is traded on public markets as part of announced stock repurchase programs. The repurchased common stock is classified as treasury stock on the consolidated balance sheets and held at cost. As of September 30, 2022 and 2021, the Company did not hold any treasury stock. Preferred Stock Our certificate of incorporation authorizes the issuance of "blank check" preferred stock with such designations, rights and preferences as may be determined from time to time by our board of directors up to an aggregate of 5,000,000 shares of preferred stock. As of September 30, 2022 and 2021, the Company has not issued any preferred stock. |
Interest Rate Swap | Interest Rate Swap The Company uses derivative financial instruments to manage interest rate risk associated with its variable debt. The Company's objective in using these interest rate derivatives is to manage its exposure to interest rate movements and reduce volatility of interest expense. The gains and losses due to changes in the fair value of the interest rate swap agreements completely offset changes in the fair value of the hedged portion of the underlying debt. Offsetting changes in fair value of both the interest rate swaps and the hedged portion of the underlying debt are recognized in interest expense in the consolidated statements of operations. The Company does not hold or issue any derivative instrument for trading or speculative purposes. |
Revenue Recognition | Revenue Recognition Disaggregation of revenue from contracts with customers |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract Balances Recognized on the Company's Consolidated Balance Sheets | The following table summarizes the contract balances recognized within the Company's consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Contract assets $ 7,682 $ 7,307 Contract liabilities $ — $ 22,473 |
Schedule of Disaggregation of Revenue From Contracts with Customers | The following series of tables presents our revenue disaggregated by these categories: Revenue by customer for the years ended September 30, 2022 and 2021 (in thousands): 2022 2021 Department of Homeland Security $ 126,576 $ 2,485 Department of Veterans Affairs 126,106 110,078 Department of Health and Human Services 102,201 91,543 Department of Defense 33,612 30,930 Other 6,678 11,058 Total Revenue $ 395,173 $ 246,094 Revenue by contract type for the years ended September 30, 2022 and 2021 (in thousands): 2022 2021 Time and Materials $ 308,944 $ 185,656 Cost Reimbursable 46,231 48,101 Firm Fixed Price 39,998 12,337 Total Revenue $ 395,173 $ 246,094 Revenue by whether the Company acts as a prime contractor or a subcontractor for the years ended September 30, 2022 and 2021(in thousands): 2022 2021 Prime Contractor $ 366,571 $ 215,241 Subcontractor 28,602 30,853 Total Revenue $ 395,173 $ 246,094 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Schedule of Summarized Lease Balances in Consolidated Balance Sheet | The following table summarizes lease balances presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Operating lease right-of-use assets $ 16,851 $ 19,919 Operating lease liabilities, current $ 2,235 $ 2,261 Operating lease liabilities, long-term 16,461 19,374 Total operating lease liabilities $ 18,696 $ 21,635 |
Schedule of Lease Costs and Other Information Related to Leases | For the years ended September 30, 2022 and 2021, total lease costs for our operating leases are as follows (in thousands): 2022 2021 Operating $ 3,548 $ 3,653 Short-term 114 103 Variable 120 81 Sublease income (a) (258) (302) Total lease costs $ 3,524 $ 3,535 (a): The Company subleases a portion of one of its leased facilities. The sublease is classified as an operating lease with respect to the underlying asset. The sublease term is 5 years and includes two additional 1 year term extension options. Other information related to our leases is as follows for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Cash paid for amounts included in the measurement of lease liabilities $ 3,411 $ 3,306 |
Schedule of Company's Future Lease Payments | The Company's future minimum lease payments as of September 30, 2022 are as follows: For the Fiscal Year Ending September 30, (in thousands) 2023 $ 3,299 2024 3,156 2025 2,995 2026 3,092 2027 2,487 Thereafter 8,513 Total future minimum lease payments 23,542 Less: imputed interest (4,846) Present value of future minimum lease payments 18,696 Less: current portion of operating lease liabilities (2,235) Long-term operating lease liabilities $ 16,461 |
Supporting Financial Informat_2
Supporting Financial Information (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable The following table summarizes Accounts receivable presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Billed receivables $ 32,814 $ 26,140 Contract assets 7,682 7,307 Allowance for doubtful accounts — — Accounts receivable $ 40,496 $ 33,447 |
Schedule of Other Current Assets | Other current assets The following table summarizes Other current assets presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Prepaid insurance and benefits $ 737 $ 655 Other receivables 945 995 Prepaid expenses 1,196 2,615 Other current assets $ 2,878 $ 4,265 |
Schedule of Equipment and Improvements, Net | Equipment and improvements, net The following table summarizes Equipment and improvements, net presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Furniture and equipment $ 893 $ 958 Computer equipment 2,316 1,262 Computer software 4,407 4,353 Leasehold improvements 1,614 1,595 Total equipment and improvements 9,230 8,168 Less: accumulated depreciation and amortization (7,526) (6,256) Equipment and improvements, net $ 1,704 $ 1,912 |
Schedule of Intangible Assets, Net | Intangible assets, net The following table summarizes Intangible assets, net presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Intangible assets Customer contracts and related customer relationships $ 62,281 $ 62,281 Covenants-not-to-compete 522 522 Trade names 3,051 3,051 Total intangible assets 65,854 65,854 Less accumulated amortization Customer contracts and related customer relationships (23,606) (17,378) Covenants-not-to-compete (316) (264) Trade names (1,048) (743) Total accumulated amortization (24,970) (18,385) Intangible assets, net $ 40,884 $ 47,469 Total amount of amortization expense for each of the years ended September 30, 2022 and 2021 was $6.6 million. As of September 30, 2022, the estimated annual amortization expense is as follows: |
Schedule of Estimated Future Amortization Expense of Finite-lived Intangibles | For the Fiscal Year Ending September 30, (in thousands) 2023 $ 6,585 2024 6,585 2025 6,585 2026 5,851 2027 4,823 Thereafter 10,455 Total amortization expense $ 40,884 |
Schedule of Accounts Payable, Accrued Expenses, and Other Current Liabilities | Accounts payable and accrued liabilities The following table summarizes Accounts payable and accrued liabilities presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Accounts payable $ 11,886 $ 16,684 Accrued benefits 3,857 2,916 Accrued bonus and incentive compensation 3,625 2,381 Accrued workers' compensation insurance 4,880 7,014 Other accrued expenses 2,614 3,722 Accounts payable and accrued liabilities $ 26,862 $ 32,717 |
Schedule of Debt Obligations | Debt obligations The following table summarizes Debt obligations presented on our consolidated balance sheets at September 30, 2022 and 2021 (in thousands): 2022 2021 Secured term loan $ 22,000 $ 46,750 Less: unamortized deferred financing costs (1,584) (2,114) Long-term portion of debt obligations, net of deferred financing costs $ 20,416 $ 44,636 As of September 30, 2022 and 2021, we had no outstanding balance on our secured revolving line of credit and have satisfied mandatory principal payments on our secured term loan for the next twelve months. |
Schedule of Interest Expense | Interest expense The following table summarizes Interest expense presented on our consolidated statements of operations for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Interest expense (a) $ 1,551 $ 2,992 Amortization of deferred financing costs (b) 664 792 Interest expense $ 2,215 $ 3,784 (a): Interest expense on borrowing |
Credit Facilities (Tables)
Credit Facilities (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Loan Facilities and Subordinated Debt Financing | A summary of our credit facilities as of September 30, 2022 and 2021 is as follows (in millions): 2022 2021 Arrangement Loan Balance Interest Loan Balance Interest Secured term loan (a) due September 30, 2025 $ 22.0 LIBOR* + 2.5% $ 46.8 LIBOR* + 3.5% Secured revolving line of credit (b) due September 30, 2025 $ — LIBOR* + 2.5% $ — LIBOR* + 3.5% |
Stock-based Compensation and _2
Stock-based Compensation and Equity Grants (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-based Compensation Expense | Stock-based compensation expense, presented in the table below, is recorded in general and administrative expenses included in our consolidated statements of operations for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 DLH employees (a) $ 1,960 $ 1,193 Non-employee directors (b) 648 467 Total stock option expense $ 2,608 $ 1,660 (a): Included in this amount are equity grants of restricted stock units to Named Executive Officers ("NEO"), which were issued in accordance with the DLH long-term incentive compensation policy, and stock option grants to NEO and non-NEO company employees. The restricted stock units totaled 140,404 restricted stock units issued and outstanding at September 30, 2022. (b): In the first quarter of fiscal year 2022, we issued 53,510 restricted stock units to the Company's non-employee directors, all of which vested as of September 30, 2022. The shares of common stock underlying such restricted stock units were issued on September 30, 2022. Unrecognized stock-based compensation expense Unrecognized stock-based compensation expense is presented in the table below for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Unrecognized expense for DLH employees (a) $ 5,214 $ 4,468 |
Schedule of Stock Option Activity | The aggregate intrinsic value in the table below represents the total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their in the money options on those dates. This amount will change based on the fair market value of the Company’s stock. (in years) Weighted Weighted Average (in thousands) (in thousands) Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Term Value Options outstanding, September 30, 2021 2,374 $ 5.60 5.6 $ 15,899 Granted (a) 275 16.17 — — Exercised (257) 3.47 — — Options outstanding, September 30, 2022 2,392 $ 7.05 5.4 $ 13,566 (a): Utilizing a volatility of 50% along with assumptions of a 10-year term and the aforementioned 10-day stock price threshold results in an indicated range of value of the options granted during the year ended September 30, 2022, as follows using the Monte Carlo method: |
Schedule of Stock Options, Valuation Assumptions | Vesting Expected Strike Stock Threshold Term Calculated Grant Date Price Price Price (Years) Fair Value November 8, 2021 $ 16.01 $ 16.01 Service 10 $ 9.68 November 8, 2021 $ 16.01 $ 16.01 $ 24.00 10 $ 9.68 November 8, 2021 $ 16.01 $ 16.01 $ 28.00 10 $ 9.64 November 8, 2021 $ 16.01 $ 16.01 $ 32.00 10 $ 9.58 August 1, 2022 $ 17.77 $ 17.77 $ 23.00 10 $ 9.68 Notes: Results based on 100,000 simulations |
Schedule of Stock Option Shares Outstanding, Vested and Expected to Vest | Stock options shares outstanding, vested and unvested for the years ended September 30, 2022 and 2021 (in thousands): Number of Shares 2022 2021 Vested and exercisable (a) 2,117 1,662 Unvested (b) 275 712 Options outstanding 2,392 2,374 (a): Weighted average exercise price of vested and exercisable shares was $5.86 and $3.91 at September 30, 2022 and 2021, respectively. Aggregate intrinsic value was approximately $13.6 million and $13.9 million at September 30, 2022 and 2021, respectively. Weighted average contractual term remaining was 4.9 years and 4.0 years at September 30, 2022 and 2021, respectively. (b): Certain awards vest upon satisfaction of certain performance criteria. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Diluted Earnings Per Share | Diluted earnings per share is calculated using the treasury stock method. Earnings Per Share information is presented in the table below for the years ending September 30, 2022 and 2021 (in thousands except for per share amounts): 2022 2021 Numerator: Net income $ 23,288 $ 10,145 Denominator: Denominator for basic net income per share - weighted-average outstanding shares 12,830 12,549 Effect of dilutive securities: Stock options and restricted stock 1,349 1,048 Denominator for diluted net income per share - weighted-average outstanding shares 14,179 13,597 Net income per share - basic $ 1.82 $ 0.81 Net income per share - diluted $ 1.64 $ 0.75 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Contractual Obligations | Contractual Obligations as of September 30, 2022 (in thousands): Payments Due Per Fiscal Year Total 2023 2024 2025 2026 2027 Thereafter Debt obligations $ 22,000 $ — $ — $ 22,000 $ — $ — $ — Facility operating leases 23,407 3,216 3,104 2,995 3,092 2,487 8,513 Equipment operating leases 135 83 52 — — — — Total contractual obligations $ 45,542 $ 3,299 $ 3,156 $ 24,995 $ 3,092 $ 2,487 $ 8,513 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Significant Components of the Expense From Continuing Operations | The significant components of provision for income taxes from continuing operations are summarized as follows for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Current expense $ 7,351 $ 2,081 Deferred expense 424 1,213 Total expense $ 7,775 $ 3,294 |
Schedule of Significant Differences Between the Income Taxes at Federal Statutory Rate and Effective Tax Rate | The following table presents the significant differences between our income taxes at the federal statutory rate and the Company's effective tax rate for continuing operations for the years ending September 30, 2022 and 2021 (in thousands): 2022 2021 Income taxes at the federal statutory rate $ 6,523 $ 2,822 State taxes, net 1,158 376 Other permanent items 94 96 Total $ 7,775 $ 3,294 |
Schedule of Deferred Tax Assets and Liabilities | An analysis of the Company's deferred tax assets and liabilities at September 30, 2022 and 2021 is as follows (in thousands): 2022 2021 Deferred tax assets: Net operating loss carry forwards, net $ 296 $ 318 Stock based compensation 668 508 Accrued compensation 2,108 2,614 Total deferred tax assets 3,072 3,440 Less: valuation allowance (262) (288) Total deferred tax assets, net 2,810 3,152 Deferred tax liabilities: Equipment and intangible assets (3,833) (3,507) Accrued expenses (407) (671) Right of use liability (104) (150) Total deferred tax liabilities (4,344) (4,328) Net deferred tax liability $ (1,534) $ (1,176) |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | A summary of quarterly information is as follows (in thousands, except per share data) 2022 Quarters First a Second a Third a Fourth Revenue $ 152,801 $ 108,699 $ 66,440 $ 67,233 Income from operations 11,219 10,254 7,114 4,691 Interest expense (672) (554) (512) (477) Income before provision for income taxes 10,547 9,700 6,602 4,214 Provision for income taxes 2,743 2,522 1,738 772 Net income $ 7,804 $ 7,178 $ 4,864 $ 3,442 Earnings per share: Basic $ 0.61 $ 0.56 $ 0.38 $ 0.27 Diluted $ 0.55 $ 0.50 $ 0.34 $ 0.24 2021 Quarters First Second Third Fourth Revenue $ 57,852 $ 61,506 $ 61,555 $ 65,182 Income from operations 3,635 4,620 4,939 4,030 Interest expense (1,080) (1,004) (893) (808) Income before provision for income taxes 2,555 3,616 4,046 3,222 Provision for income taxes 741 1,049 1,166 339 Net income $ 1,814 $ 2,567 $ 2,880 $ 2,883 Earnings per share: Basic $ 0.15 $ 0.20 $ 0.23 $ 0.23 Diluted $ 0.13 $ 0.19 $ 0.21 $ 0.21 |
Significant Accounting Polici_3
Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Finite-lived intangibles estimated useful lives | 10 years | |
Goodwill | $ 65,643,000 | $ 65,643,000 |
Goodwill impairment loss | 0 | 0 |
Uncertain tax positions | 0 | 0 |
Tax interest | 0 | 0 |
Tax penalties | 0 | $ 0 |
FDIC insurance limit amount | $ 250,000 | |
Treasury stock (shares) | 0 | |
Authorized shares of preferred stock (shares) | 5,000,000 | |
Issued preferred stock (shares) | 0 | |
Stock Options | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Number of options authorized for issuance (in shares) | 0 | |
Expiration term of options | 10 years | |
Minimum | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Estimated useful lives of property and equipment | 3 years | |
Minimum | Facilities and Equipment | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Remaining lease term | 2 months 12 days | |
Maximum | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Estimated useful lives of property and equipment | 7 years | |
Maximum | Facilities and Equipment | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Remaining lease term | 8 years 6 months |
Revenue Recognition - Contract
Revenue Recognition - Contract Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 7,682 | $ 7,307 |
Contract liabilities | $ 0 | $ 22,473 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | $ 67,233 | $ 66,440 | $ 108,699 | $ 152,801 | $ 65,182 | $ 61,555 | $ 61,506 | $ 57,852 | $ 395,173 | $ 246,094 |
Prime Contractor | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 366,571 | 215,241 | ||||||||
Subcontractor | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 28,602 | 30,853 | ||||||||
Time and Materials | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 308,944 | 185,656 | ||||||||
Cost Reimbursable | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 46,231 | 48,101 | ||||||||
Firm Fixed Price | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 39,998 | 12,337 | ||||||||
Department of Homeland Security | Revenue Concentration | Customer Concentration | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 126,576 | 2,485 | ||||||||
Department of Veterans Affairs | Revenue Concentration | Customer Concentration | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 126,106 | 110,078 | ||||||||
Department of Health and Human Services | Revenue Concentration | Customer Concentration | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 102,201 | 91,543 | ||||||||
Department of Defense | Revenue Concentration | Customer Concentration | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | 33,612 | 30,930 | ||||||||
Other | Revenue Concentration | Customer Concentration | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Total Revenue | $ 6,678 | $ 11,058 |
Leases - Narrative (Details)
Leases - Narrative (Details) | 12 Months Ended |
Sep. 30, 2022 sublease_option sublease | |
Leases [Abstract] | |
Number of subleased facilities | sublease | 1 |
Sublease term | 5 years |
Number of sublease extension options | sublease_option | 2 |
Sublease option extension period | 1 year |
Weighted-average remaining lease term | 7 years 6 months |
Weighted-average discount rate | 6% |
Leases - Summary of Lease Balan
Leases - Summary of Lease Balances in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 16,851 | $ 19,919 |
Operating lease liabilities, current | 2,235 | 2,261 |
Operating lease liabilities - long-term | 16,461 | 19,374 |
Total operating lease liabilities | $ 18,696 | $ 21,635 |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Leases [Abstract] | ||
Operating | $ 3,548 | $ 3,653 |
Short-term | 114 | 103 |
Variable | 120 | 81 |
Sublease income (a) | (258) | (302) |
Total lease costs | $ 3,524 | $ 3,535 |
Leases - Company's Future Minim
Leases - Company's Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Leases [Abstract] | ||
2023 | $ 3,299 | |
2024 | 3,156 | |
2025 | 2,995 | |
2026 | 3,092 | |
2027 | 2,487 | |
Thereafter | 8,513 | |
Total future minimum lease payments | 23,542 | |
Less: imputed interest | (4,846) | |
Present value of future minimum lease payments | 18,696 | $ 21,635 |
Less: current portion of operating lease liabilities | (2,235) | (2,261) |
Long-term operating lease liabilities | $ 16,461 | $ 19,374 |
Leases - Other Information Rela
Leases - Other Information Related to Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 3,411 | $ 3,306 |
Supporting Financial Informat_3
Supporting Financial Information - Accounts Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Billed receivables | $ 32,814 | $ 26,140 |
Contract assets | 7,682 | 7,307 |
Allowance for doubtful accounts | 0 | 0 |
Accounts receivable | $ 40,496 | $ 33,447 |
Supporting Financial Informat_4
Supporting Financial Information - Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Prepaid insurance and benefits | $ 737 | $ 655 |
Other receivables | 945 | 995 |
Prepaid expenses | 1,196 | 2,615 |
Other current assets | $ 2,878 | $ 4,265 |
Supporting Financial Informat_5
Supporting Financial Information - Equipment and Improvements, net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Furniture and equipment | $ 893 | $ 958 |
Computer equipment | 2,316 | 1,262 |
Computer software | 4,407 | 4,353 |
Leasehold improvements | 1,614 | 1,595 |
Total equipment and improvements | 9,230 | 8,168 |
Less: accumulated depreciation and amortization | (7,526) | (6,256) |
Equipment and improvements, net | 1,704 | 1,912 |
Depreciation | $ 1,100 | $ 1,500 |
Supporting Financial Informat_6
Supporting Financial Information - Intangible Assets, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 65,854 | $ 65,854 |
Less accumulated amortization | (24,970) | (18,385) |
Intangible assets, net | 40,884 | 47,469 |
Amortization expense of intangibles | 6,600 | |
Customer contracts and related customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 62,281 | 62,281 |
Less accumulated amortization | (23,606) | (17,378) |
Covenants-not-to-compete | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 522 | 522 |
Less accumulated amortization | (316) | (264) |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 3,051 | 3,051 |
Less accumulated amortization | $ (1,048) | $ (743) |
Supporting Financial Informat_7
Supporting Financial Information - Estimated Amortization Expense of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
2023 | $ 6,585 | |
2024 | 6,585 | |
2025 | 6,585 | |
2026 | 5,851 | |
2027 | 4,823 | |
Thereafter | 10,455 | |
Intangible assets, net | $ 40,884 | $ 47,469 |
Supporting Financial Informat_8
Supporting Financial Information - Accounts Payable, Accrued Expense and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts payable | $ 11,886 | $ 16,684 |
Accrued benefits | 3,857 | 2,916 |
Accrued bonus and incentive compensation | 3,625 | 2,381 |
Accrued workers' compensation insurance | 4,880 | 7,014 |
Other accrued expenses | 2,614 | 3,722 |
Accounts payable and accrued liabilities | $ 26,862 | $ 32,717 |
Supporting Financial Informat_9
Supporting Financial Information - Debt Obligations (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Debt Instrument [Line Items] | ||
Long-term portion of debt obligations, net of deferred financing costs | $ 20,416 | $ 44,636 |
Secured Debt | ||
Debt Instrument [Line Items] | ||
Secured term loan | 22,000 | 46,750 |
Less: unamortized deferred financing costs | (1,584) | (2,114) |
Long-term portion of debt obligations, net of deferred financing costs | 20,416 | 44,636 |
Secured Debt | Term loan | ||
Debt Instrument [Line Items] | ||
Secured term loan | $ 22,000 | $ 46,800 |
Supporting Financial Informa_10
Supporting Financial Information - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||
Interest expense (a) | $ 1,551 | $ 2,992 | ||||||||
Amortization of deferred financing costs (b) | 664 | 792 | ||||||||
Interest expense | $ 477 | $ 512 | $ 554 | $ 672 | $ 808 | $ 893 | $ 1,004 | $ 1,080 | $ 2,215 | $ 3,784 |
Credit Facilities - Summary of
Credit Facilities - Summary of Loan Facilities and Subordinated Debt Financing (Details) - Secured Debt - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Debt Instrument [Line Items] | ||
Loan Balance | $ 22,000,000 | $ 46,750,000 |
Secured term loan | ||
Debt Instrument [Line Items] | ||
Loan Balance | $ 22,000,000 | $ 46,800,000 |
Secured term loan | LIBOR | ||
Debt Instrument [Line Items] | ||
Debt instrument, basis spread on variable rate | 0.025% | 3.50% |
Debt instrument, floor percentage | 0.50% | |
Secured revolving line of credit | ||
Debt Instrument [Line Items] | ||
Loan Balance | $ 0 | $ 0 |
Secured revolving line of credit | LIBOR | ||
Debt Instrument [Line Items] | ||
Debt instrument, basis spread on variable rate | 0.025% | 3.50% |
Debt instrument, interest rate, effective percentage | 2.52% | 0.08% |
Debt instrument, floor percentage | 0.50% |
Credit Facilities - Narrative (
Credit Facilities - Narrative (Details) | 12 Months Ended | |
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | |
Line of Credit Facility [Line Items] | ||
Debt annual amortization amount fiscal year 2021 | $ 0 | |
Debt annual amortization amount fiscal year 2022 | 0 | |
Debt annual amortization amount fiscal year 2023 | 22,000,000 | |
Debt annual amortization fiscal year 2024 | 0 | |
Debt annual amortization fiscal year 2025 | 0 | |
Total repayments of debt | 41,750,000 | $ 54,200,000 |
Excess cash flow payment required | 0 | |
Notional amount of floating-to-fix interest rate swap | $ 16,200,000 | |
Interest Rate Swap | ||
Line of Credit Facility [Line Items] | ||
Fixed interest rate applicable to swaps | 1.61% | |
Increase in interest expense | $ 200,000 | |
Secured Debt | ||
Line of Credit Facility [Line Items] | ||
Secured term loan | $ 22,000,000 | 46,750,000 |
Secured Debt | Term loan | ||
Line of Credit Facility [Line Items] | ||
Fixed charge coverage ratio | 1.25 | |
Ratio of debt to EBITDA | 2.75 | |
Debt annual amortization amount fiscal year 2021 | $ 7,000,000 | |
Debt annual amortization amount fiscal year 2022 | 7,000,000 | |
Debt annual amortization amount fiscal year 2023 | 8,750,000 | |
Debt annual amortization fiscal year 2024 | 8,750,000 | |
Debt annual amortization fiscal year 2025 | 8,750,000 | |
Voluntary repayments of debt | 34,000,000 | |
Total repayments of debt | 48,000,000 | |
Secured term loan | $ 22,000,000 | 46,800,000 |
Secured Debt | Term loan | Maximum | ||
Line of Credit Facility [Line Items] | ||
Ratio of debt to EBITDA | 3.75 | |
Debt instrument, interest rate, effective percentage | 4.50% | |
Secured Debt | Term loan | Minimum | ||
Line of Credit Facility [Line Items] | ||
Debt instrument, interest rate, effective percentage | 2.50% | |
Secured Debt | Term loan | Excess Cash Flow Greater Than or Equal to 2.50 | ||
Line of Credit Facility [Line Items] | ||
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA | 75% | |
Ratio of funded indebtedness to adjusted EBIDTA | 2.50 | |
Secured Debt | Term loan | Excess Cash Flow Less Than 2.50 But Greater Than or Equal to 1.50 | ||
Line of Credit Facility [Line Items] | ||
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA | 50% | |
Secured Debt | Term loan | Excess Cash Flow Less Than 2.50 But Greater Than or Equal to 1.50 | Maximum | ||
Line of Credit Facility [Line Items] | ||
Ratio of funded indebtedness to adjusted EBIDTA | 2.50 | |
Secured Debt | Term loan | Excess Cash Flow Equal to 1.50 | ||
Line of Credit Facility [Line Items] | ||
Ratio of funded indebtedness to adjusted EBIDTA | 1.5 | |
Secured Debt | Term loan | Excess Cash Flow Less Than 1.50 | ||
Line of Credit Facility [Line Items] | ||
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA | 0% | |
Ratio of funded indebtedness to adjusted EBIDTA | 1.5 | |
Secured Debt | Secured revolving line of credit | ||
Line of Credit Facility [Line Items] | ||
Line of credit ceiling | $ 25,000,000 | |
Secured term loan | 0 | $ 0 |
Remaining borrowing availability | 25,000,000 | |
Unused borrowing capacity | 23,000,000 | |
Secured Debt | Letters of credit | ||
Line of Credit Facility [Line Items] | ||
Remaining borrowing availability | $ 5,000,000 |
Stock-based Compensation and _3
Stock-based Compensation and Equity Grants - Narrative (Details) - Stock Options | 12 Months Ended |
Sep. 30, 2022 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of options that may be granted with a term of more than 10 years from date of grant (in shares) | 0 |
Expiration term of options | 10 years |
Number of shares available for grant (in shares) | 1,400,000 |
2016 Omnibus Equity Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of options that may be granted with a term of more than 10 years from date of grant (in shares) | 0 |
Expiration term of options | 10 years |
Stock-based Compensation and _4
Stock-based Compensation and Equity Grants - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Selling, General and Administrative Expenses | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Total compensation expense | $ 2,608 | $ 1,660 | |
DLH Employees | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Unrecognized expense for DLH employees (a) | $ 5,214 | 4,468 | |
Weighted average period for recognition of compensation expense | 4 years 2 months 12 days | ||
DLH Employees | Selling, General and Administrative Expenses | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Total compensation expense | $ 1,960 | 1,193 | |
Non-employee Directors | Restricted Stock Units | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Number of restricted stock units issued (in shares) | 53,510 | ||
Number of restricted stocks vested in period (in shares) | 53,510 | ||
Non-employee Directors | Selling, General and Administrative Expenses | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Total compensation expense | $ 648 | $ 467 | |
NEO | Restricted Stock Units | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Number of restricted stock units issued (in shares) | 140,404 | ||
Number of restricted stock outstanding (in shares) | 140,404 |
Stock-based Compensation and _5
Stock-based Compensation and Equity Grants - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Number of Shares | ||
Outstanding at September 30, 2020 (in shares) | 2,374 | |
Granted (in shares) | 275 | |
Exercised (in shares) | (257) | |
Outstanding at September 30, 2021 (in shares) | 2,392 | 2,374 |
Weighted Average Exercise Price | ||
Outstanding at September 30, 2020 (in dollars per share) | $ 5.60 | |
Granted (in dollars per share) | 16.17 | |
Exercised (in dollars per share) | 3.47 | |
Outstanding at September 30, 2021 (in dollars per share) | $ 7.05 | $ 5.60 |
Weighted Average Remaining Contractual Term (in years) | ||
Outstanding at September 30, 2020 | 5 years 4 months 24 days | 5 years 7 months 6 days |
Outstanding at September 30, 2021 | 5 years 4 months 24 days | 5 years 7 months 6 days |
Aggregate Intrinsic Value | ||
Outstanding at the September 30, 2020 | $ 15,899 | |
Options outstanding at September 30, 2021 | $ 13,566 | $ 15,899 |
Stock Options | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Volatility rate | 50% | |
Term | 10 years | |
Stock price threshold term | 10 days |
Stock-based Compensation and _6
Stock-based Compensation and Equity Grants - Stock Options Fair Value Assumptions (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Aug. 01, 2022 | Nov. 08, 2021 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Volatility | 50% | ||
Expected term (Years) | 10 years | ||
Fair Value Assumption One | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Strike price (in dollars per share) | $ 0.1601 | ||
Stock price (in dollars per share) | $ 0.1601 | ||
Expected term (Years) | 10 years | ||
Calculated fair value (in dollars per share) | $ 0.0968 | ||
Fair Value Assumption Two | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Strike price (in dollars per share) | 0.1601 | ||
Stock price (in dollars per share) | 0.1601 | ||
Vesting threshold price (in dollars per share) | $ 0.2400 | ||
Expected term (Years) | 10 years | ||
Calculated fair value (in dollars per share) | $ 0.0968 | ||
Fair Value Assumption Three | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Strike price (in dollars per share) | 0.1601 | ||
Stock price (in dollars per share) | 0.1601 | ||
Vesting threshold price (in dollars per share) | $ 0.2800 | ||
Expected term (Years) | 10 years | ||
Calculated fair value (in dollars per share) | $ 0.0964 | ||
Fair Value Assumption Four | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Strike price (in dollars per share) | 0.1601 | ||
Stock price (in dollars per share) | 0.1601 | ||
Vesting threshold price (in dollars per share) | $ 0.3200 | ||
Expected term (Years) | 10 years | ||
Calculated fair value (in dollars per share) | $ 0.0958 | ||
Fair Value Assumption Five | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Strike price (in dollars per share) | $ 17.77 | ||
Stock price (in dollars per share) | 17.77 | ||
Vesting threshold price (in dollars per share) | $ 23 | ||
Expected term (Years) | 10 years | ||
Calculated fair value (in dollars per share) | $ 9.68 |
Stock-based Compensation and _7
Stock-based Compensation and Equity Grants - Stock Options Outstanding, Vested and Unvested (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Payment Arrangement [Abstract] | ||
Vested and exercisable (in shares) | 2,117 | 1,662 |
Unvested (in shares) | 275 | 712 |
Options outstanding (in shares) | 2,392 | 2,374 |
Weighted average exercise price of vested and exercisable shares (in dollars per share) | $ 5.86 | $ 3.91 |
Aggregate intrinsic value of vested and exercisable shares | $ 13.6 | $ 13.9 |
Weighted average contractual term remaining of vested and exercisable shares | 4 years 10 months 24 days | 4 years |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator: | ||||||||||
Net income | $ 3,442 | $ 4,864 | $ 7,178 | $ 7,804 | $ 2,883 | $ 2,880 | $ 2,567 | $ 1,814 | $ 23,288 | $ 10,145 |
Denominator: | ||||||||||
Denominator for basic net income per share - weighted-average outstanding shares (in shares) | 12,830 | 12,549 | ||||||||
Effect of dilutive securities: | ||||||||||
Stock options and restricted stock (in shares) | 1,349 | 1,048 | ||||||||
Denominator for diluted net income per share - weighted-average outstanding shares (in shares) | 14,179 | 13,597 | ||||||||
Net income per share - basic (in dollars per share) | $ 0.27 | $ 0.38 | $ 0.56 | $ 0.61 | $ 0.23 | $ 0.23 | $ 0.20 | $ 0.15 | $ 1.82 | $ 0.81 |
Net income per share - diluted (in dollars per share) | $ 0.24 | $ 0.34 | $ 0.50 | $ 0.55 | $ 0.21 | $ 0.21 | $ 0.19 | $ 0.13 | $ 1.64 | $ 0.75 |
Commitments and Contingencies -
Commitments and Contingencies - Contractual Obligations (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Maturity of Debt Obligations | |
Net bank debt obligations | $ 22,000 |
2023 | 0 |
2024 | 0 |
2025 | 22,000 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Maturity Operating Leases | |
Total future minimum lease payments | 23,542 |
2023 | 3,299 |
2024 | 3,156 |
2025 | 2,995 |
2026 | 3,092 |
2027 | 2,487 |
Thereafter | 8,513 |
Maturity Total Contractual Obligations | |
Total contractual obligations | 45,542 |
2023 | 3,299 |
2024 | 3,156 |
2025 | 24,995 |
2026 | 3,092 |
2027 | 2,487 |
Thereafter | 8,513 |
Facility operating leases | |
Maturity Operating Leases | |
Total future minimum lease payments | 23,407 |
2023 | 3,216 |
2024 | 3,104 |
2025 | 2,995 |
2026 | 3,092 |
2027 | 2,487 |
Thereafter | 8,513 |
Equipment operating leases | |
Maturity Operating Leases | |
Total future minimum lease payments | 135 |
2023 | 83 |
2024 | 52 |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Thereafter | $ 0 |
Commitments and Contingencies_2
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Sep. 30, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Workers' compensation liability | $ 4.9 | $ 7 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||||||||
Current expense | $ 7,351 | $ 2,081 | ||||||||
Deferred expense | 424 | 1,213 | ||||||||
Total expense | $ 772 | $ 1,738 | $ 2,522 | $ 2,743 | $ 339 | $ 1,166 | $ 1,049 | $ 741 | $ 7,775 | $ 3,294 |
Income Taxes - Effective Tax Ra
Income Taxes - Effective Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||||||||
Income taxes at the federal statutory rate | $ 6,523 | $ 2,822 | ||||||||
State taxes, net | 1,158 | 376 | ||||||||
Other permanent items | 94 | 96 | ||||||||
Total expense | $ 772 | $ 1,738 | $ 2,522 | $ 2,743 | $ 339 | $ 1,166 | $ 1,049 | $ 741 | $ 7,775 | $ 3,294 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 |
Deferred tax assets: | ||
Net operating loss carry forwards, net | $ 296 | $ 318 |
Stock based compensation | 668 | 508 |
Accrued compensation | 2,108 | 2,614 |
Total deferred tax assets | 3,072 | 3,440 |
Less: valuation allowance | (262) | (288) |
Total deferred tax assets, net | 2,810 | 3,152 |
Deferred tax liabilities: | ||
Equipment and intangible assets | (3,833) | (3,507) |
Accrued expenses | (407) | (671) |
Right of use liability | (104) | (150) |
Total deferred tax liabilities | (4,344) | (4,328) |
Net deferred tax (liability) | $ (1,534) | $ (1,176) |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||
Revenue | $ 67,233 | $ 66,440 | $ 108,699 | $ 152,801 | $ 65,182 | $ 61,555 | $ 61,506 | $ 57,852 | $ 395,173 | $ 246,094 |
Income from operations | 4,691 | 7,114 | 10,254 | 11,219 | 4,030 | 4,939 | 4,620 | 3,635 | 33,278 | 17,223 |
Interest expense | (477) | (512) | (554) | (672) | (808) | (893) | (1,004) | (1,080) | (2,215) | (3,784) |
Income before provision for income taxes | 4,214 | 6,602 | 9,700 | 10,547 | 3,222 | 4,046 | 3,616 | 2,555 | 31,063 | 13,439 |
Provision for income taxes | 772 | 1,738 | 2,522 | 2,743 | 339 | 1,166 | 1,049 | 741 | 7,775 | 3,294 |
Net income | $ 3,442 | $ 4,864 | $ 7,178 | $ 7,804 | $ 2,883 | $ 2,880 | $ 2,567 | $ 1,814 | $ 23,288 | $ 10,145 |
Basic (in dollars per share) | $ 0.27 | $ 0.38 | $ 0.56 | $ 0.61 | $ 0.23 | $ 0.23 | $ 0.20 | $ 0.15 | $ 1.82 | $ 0.81 |
Diluted (in dollars per share) | $ 0.24 | $ 0.34 | $ 0.50 | $ 0.55 | $ 0.21 | $ 0.21 | $ 0.19 | $ 0.13 | $ 1.64 | $ 0.75 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Retirement Benefits [Abstract] | ||
Defined contribution plan, recorded expense | $ 2,200 | $ 1,500 |
Defined contribution plan, matching contributions period | 4 years |