ICF Reports Third Quarter 2025 Results

¹ Non-GAAP EPS, EBITDA, and Adjusted EBITDA are Non-GAAP measurements. A reconciliation of all Non-GAAP measurements to the most applicable GAAP number is set forth below. Special charges are items that were included within our consolidated statements of comprehensive income but are not indicative of ongoing performance and have been presented net of applicable U.S. GAAP taxes. The presentation of Non-GAAP measurements may not be comparable to other similarly titled measures used by other companies.

ICF International, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(Unaudited)

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

(in thousands, except per share amounts)  

2025

2024

2025

2024

Revenue

$                    465,405

$                  516,998

$              1,429,178

$               1,523,463

Direct costs

290,545

325,047

891,512

964,911

Operating costs and expenses:

Indirect and selling expenses

122,261

132,816

377,169

389,001

Depreciation and amortization

14,168

13,111

43,665

40,176

Total operating costs and expenses

136,429

145,927

420,834

429,177

Operating income

38,431

46,024

116,832

129,375

Interest, net

(7,861)

(7,195)

(23,620)

(23,136)

Other income (expense)

176

(899)

(2,515)

767

Income before income taxes

30,746

37,930

90,697

107,006

Provision for income taxes

6,980

5,251

16,419

21,399

Net income

$                      23,766

$                   32,679

$                  74,278

$                    85,607

Earnings per Share:

Basic

$                         1.29

$                       1.74

$                      4.03

$                       4.57

Diluted

$                         1.28

$                       1.73

$                      4.01

$                       4.53

Weighted-average Shares:

Basic

18,432

18,760

18,447

18,752

Diluted

18,526

18,910

18,542

18,915

Cash dividends declared per common share

$                         0.14

$                       0.14

$                      0.42

$                       0.42

Other comprehensive (loss) income, net of tax

(1,733)

(951)

1,712

(610)

Comprehensive income, net of tax

$                      22,033

$                   31,728

$                  75,990

$                    84,997

ICF International, Inc. and Subsidiaries

Reconciliation of Non-GAAP financial measures ⁽²⁾ 

(Unaudited)

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

(in thousands, except per share amounts)

2025

2024

2025

2024

Reconciliation of  EBITDA and Adjusted EBITDA ⁽³⁾

Net income

$                  23,766

$                  32,679

$                74,278

$                85,607

Interest, net

7,861

7,195

23,620

23,136

Provision for income taxes

6,980

5,251

16,419

21,399

Depreciation and amortization 

14,168

13,111

43,665

40,176

EBITDA 

52,775

58,236

157,982

170,318

Acquisition and divestiture-related expenses ⁽⁴⁾

25

139

479

205

Severance and other costs related to staff realignment ⁽⁵⁾

359

449

2,909

1,184

Charges and adjustments related to facility consolidations and office closures ⁽⁶⁾

—

—

(138)

—

Pre-tax gain from divestiture of a business ⁽⁷⁾

—

(298)

—

(2,013)

Total Adjustments

384

290

3,250

(624)

Adjusted EBITDA

$                  53,159

$                  58,526

$              161,232

$              169,694

Net Income Margin Percent on Revenue ⁽⁸⁾

5.1 %

6.3 %

5.2 %

5.6 %

EBITDA Margin Percent on Revenue ⁽⁹⁾

11.3 %

11.3 %

11.1 %

11.2 %

Adjusted EBITDA Margin Percent on Revenue ⁽⁹⁾

11.4 %

11.3 %

11.3 %

11.1 %

Reconciliation of Non-GAAP Diluted EPS ⁽³⁾

U.S. GAAP Diluted EPS

$                      1.28

$                      1.73

$                    4.01

$                    4.53

Acquisition and divestiture-related expenses

—

0.01

0.02

0.01

Severance and other costs related to staff realignment

0.02

0.02

0.16

0.06

Charges and adjustments related to facility consolidations and office closures ⁽¹⁰⁾

—

—

(0.01)

0.04

Pre-tax gain from divestiture of a business

—

(0.02)

—

(0.11)

Amortization of intangible assets acquired in business combinations ⁽¹¹⁾

0.49

0.44

1.50

1.31

Income tax effects of the adjustments ⁽¹²⁾

(0.12)

(0.05)

(0.38)

(0.26)

Non-GAAP Diluted EPS

$                      1.67

$                      2.13

$                    5.30

$                    5.58

⁽²⁾ These tables provide reconciliations of Non-GAAP financial measures to the most applicable U.S. GAAP numbers. While we believe that these Non-GAAP financial measures may be useful in evaluating our financial information, they should be considered supplemental in nature and not as a substitute for financial information prepared in accordance with U.S. GAAP. Other companies may define similarly titled Non-GAAP measures differently and, accordingly, care should be exercised in understanding how we define these measures. 

⁽³⁾ Reconciliations of EBITDA, Adjusted EBITDA, and Non-GAAP Diluted EPS were calculated using numbers as reported in U.S. GAAP.

⁽⁴⁾ These are primarily third-party costs related to acquisitions and integration of acquisitions.

⁽⁵⁾ These costs are due to involuntary employee termination benefits for (i) our officers and (ii) group of employees who have been notified that they will be terminated as part of a business reorganization or exit.

⁽⁶⁾ These charges and adjustments are related to a previously exited leased facility which we will continue to pay until the contractual obligations are satisfied but with no economic benefit to us, and the closure of certain international offices.

⁽⁷⁾ Pre-tax gain related to the 2023 divestiture of our U.S. commercial marketing business which includes contingent gains realized in the first quarter of 2024.

⁽⁸⁾ Net Income Margin Percent on Revenue was calculated by dividing net income by revenue.

⁽⁹⁾ EBITDA Margin Percent and Adjusted EBITDA Margin Percent on Revenue were calculated by dividing the Non-GAAP measure by the corresponding revenue.

⁽¹⁰⁾ These are office closure charges and adjustments previously included in Adjusted EBITDA and accelerated depreciation related to fixed assets for planned office closures.

⁽¹¹⁾ The amortization of intangible assets acquired from business combinations totaled $9.2 million and $8.3 million for the three months ended September 30, 2025 and 2024, respectively, and $27.9 million and $24.9 million for the nine months ended September 30, 2025 and 2024, respectively. 

⁽¹²⁾ Income tax effects were calculated using the effective tax rate, adjusted for certain discrete items, if any, of 22.7% and 13.8% for the three months ended September 30, 2025 and 2024, respectively, and 23.0% and 20.0% for the nine months ended September 30, 2025 and 2024, respectively.

ICF International, Inc. and Subsidiaries

Consolidated Balance Sheets

(in thousands, except share amounts)

September 30, 2025

December 31, 2024

(Unaudited)

ASSETS

Current Assets:

Cash and cash equivalents

$                       3,988

$                      4,960

Restricted cash

46,965

13,857

Contract receivables, net

233,014

256,923

Contract assets

225,946

188,941

Prepaid expenses and other assets

22,115

21,133

Income tax receivable

36,952

6,260

Total Current Assets

568,980

492,074

Property and Equipment, net

58,807

66,503

Other Assets:

Goodwill

1,252,136

1,248,855

Other intangible assets, net

88,824

111,701

Operating lease - right-of-use assets

108,602

115,531

Deferred tax assets

—

1,603

Other assets

36,221

30,086

Total Assets

$                 2,113,570

$               2,066,353

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:

Accounts payable

$                    139,235

$                  159,522

Contract liabilities

34,680

24,580

Operating lease liabilities 

18,544

20,721

Finance lease liabilities

2,681

2,612

Accrued salaries and benefits

84,262

105,773

Accrued subcontractors and other direct costs

50,791

49,271

Accrued expenses and other current liabilities

73,182

86,701

Total Current Liabilities

403,375

449,180

Long-term Liabilities:

Long-term debt

449,404

411,743

Operating lease liabilities - non-current

144,077

155,935

Finance lease liabilities - non-current

9,242

11,261

Deferred income taxes

22,795

—

Other long-term liabilities

60,556

55,775

Total Liabilities

1,089,449

1,083,894

Commitments and Contingencies

Stockholders' Equity:

Preferred stock, par value $.001; 5,000,000 shares authorized; none issued

—

—

Common stock, par value $.001; 70,000,000 shares authorized; 24,345,942 and 24,186,962 shares

issued at September 30, 2025 and December 31, 2024, respectively; 18,435,932 and 18,666,290 shares

outstanding at September 30, 2025 and December 31, 2024, respectively

24

24

Additional paid-in capital

458,902

443,463

Retained earnings

941,319

874,772

Treasury stock, 5,910,010 and 5,520,672 shares at September 30, 2025 and December 31, 2024, respectively

(362,090)

(320,054)

Accumulated other comprehensive loss

(14,034)

(15,746)

Total Stockholders' Equity

1,024,121

982,459

Total Liabilities and Stockholders' Equity

$                 2,113,570

$               2,066,353

ICF International, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

Nine Months Ended

September 30,

(in thousands)

2025

2024

Cash Flows from Operating Activities

Net income

$                         74,278

$                         85,607

Adjustments to reconcile net income to net cash provided by operating activities:

Provision for credit losses

(305)

3,176

Deferred income taxes and unrecognized income tax benefits

20,186

(16,957)

Non-cash equity compensation

12,915

12,494

Depreciation and amortization

43,665

40,176

Gain on divestiture of a business

—

(2,009)

Other operating adjustments, net

3,837

2,206

Changes in operating assets and liabilities, net of the effects of acquisitions:

Net contract assets and liabilities

(22,676)

(40,155)

Contract receivables

26,829

(9,634)

Prepaid expenses and other assets

(2,470)

(434)

Operating lease assets and liabilities, net

(6,774)

(3,065)

Accounts payable

(21,099)

(13,402)

Accrued salaries and benefits

(22,143)

2,889

Accrued subcontractors and other direct costs

(25)

9,660

Accrued expenses and other current liabilities

(9,804)

16,979

Income tax receivable and payable

(30,566)

(9,574)

Other liabilities

396

(1,773)

Net Cash Provided by Operating Activities

66,244

76,184

Cash Flows from Investing Activities

Payments for purchase of property and equipment and capitalized software

(14,745)

(15,559)

Proceeds from divestiture of a business

—

1,985

Other investing, net

403

—

Net Cash Used in Investing Activities

(14,342)

(13,574)

Cash Flows from Financing Activities

Advances from working capital facilities

1,048,671

917,953

Payments on working capital facilities

(1,011,838)

(930,043)

Proceeds from other short-term borrowings

10,798

43,735

Repayments of other short-term borrowings

(16,620)

(53,280)

Receipt of restricted contract funds

—

1,275

Payment of restricted contract funds

—

(3,586)

Dividends paid

(7,775)

(7,880)

Net payments for stock issuances and share repurchases

(39,512)

(30,995)

Other financing, net

(1,950)

(1,777)

Net Cash Used in Financing Activities

(18,226)

(64,598)

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash

1,433

174

Net Change in Cash, Cash Equivalents, and Restricted Cash

35,109

(1,814)

Cash, Cash Equivalents, and Restricted Cash, Beginning of Period

18,817

9,449

Cash, Cash Equivalents, and Restricted Cash, End of Period

$                         53,926

$                           7,635

Supplemental Disclosure of Cash Flow Information

Cash paid during the period for:

Interest

$                         20,045

$                         24,388

Income taxes

$                         27,431

$                         50,382

ICF International, Inc. and Subsidiaries

Supplemental Schedule ⁽¹³⁾

Revenue by client market

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2025

2024

2025

2024

Energy, environment, infrastructure, and disaster recovery

53 %

46 %

51 %

46 %

Health and social programs

33 %

38 %

34 %

38 %

Security and other civilian & commercial

14 %

16 %

15 %

16 %

Total

100 %

100 %

100 %

100 %

Revenue by client type

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2025

2024

2025

2024

U.S. federal government

43 %

55 %

45 %

55 %

U.S. state and local government

17 %

15 %

17 %

16 %

International government

6 %

5 %

6 %

5 %

Total Government

66 %

75 %

68 %

76 %

Commercial

34 %

25 %

32 %

24 %

Total

100 %

100 %

100 %

100 %

Revenue by contract mix

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2025

2024

2025

2024

Time-and-materials

44 %

43 %

43 %

42 %

Fixed-price

49 %

46 %

49 %

46 %

Cost-based

7 %

11 %

8 %

12 %

Total

100 %

100 %

100 %

100 %

⁽¹³⁾ As is shown in the supplemental schedule, we track revenue by key metrics that provide useful information about the nature of our operations. Client markets provide insight into the breadth of our expertise.  Client type is an indicator of the diversity of our client base.  Revenue by contract mix provides insight in terms of the degree of performance risk that we have assumed.