ICF International : Investor Day Presentation

Welcome

Investor Day 2019

Cautionary Statement

Certain statements made by us in this presentation that are not historical facts or that relate to future plans, events, or performances are forward-looking statements within the meaning of the federal securities laws. Our actual results may differ materially from those expressed in any forward-looking statements made by us. All statements made by us in this presentation are qualified in all respects by the information disclosed in our filings with the Securities and Exchange Commission and specifically, the risks described therein under the heading "Risk Factors". We are under no duty to update or revise any forward-looking statements pursuant to actual results or events, and do not intend to do so.

2

Growth is in our DNA

3

4

ICF Strengths

Revenue and	Steady margin
earnings	expansion
growth across	over time
U.S. presidential
administrations

80% of business	Strong cash
with stable long-	flow translating
term backlog and	into shareholder
contracts	value creation

5

Strong performance across U.S. administrations

Revenue ($MM)

Bush Administration

Obama Administration

Trump Administration

1,600

1,400

1,200

1,000

800

600

400

200

-

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019*

			Source: 10-K Filings *Midpoint of 2019 guidance affirmed on November 6, 2019
Sustained growth	• Support for broad array of	• Professional	• Innovation
driven by:	government	agility
	missions

6

Effective use of leverage

With strong financial market support, ICF has effectively levered up for opportunities and paid down debt

Bank Leverage Ratio

3.00x

2.50x

2.00x

1.50x

1.00x

0.50x

0.00x

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Debt to Bank EBITDA

7

Strong value creation since IPO

ICF has delivered above average total shareholder return compared with major indices

as of Nov. 20, 2019

		2006 - 2019
800		CAGR
700
	ICFI
600		15.8%
500
400
v	NASDAQ
300		10.7%
200
	S&P 500
100		6.7%

-

-06	-07	-08	-09	-10	-11	-12	-13	-14	-15	-16	-17	-18	-19
Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep	Sep

8

ICF: a proven player with significant growth upside

Opportunity to	Unique portfolio	Demonstrated
grow	combining deep	agility
	domain expertise
	with IT +
	engagement
	capabilities

9

Business

Overview

Presented by:

John Wasson, President and Chief Executive Officer

Investor Day 2019

10

ICF's growth strategy

Sustaining and	Increasing scale	Building out service
growing expertise	in implementation	offerings at the
in core vertical	to win larger	intersections of
markets	contracts	markets and
		functional expertise

Increased emphasis on innovation and expanding strategic client relationships

11

Synergy in markets and capabilities

Advisory + Strategy

Program Management

Technology,

Analytics +

Engagement

Energy, Environment + Infrastructure 44%

Consumer + Financial

10%

Health + Social Programs 38%

Safety + Security 8%

• Proprietary IP/ loyalty programs
• Workforce of long-time industry experts
• Longstanding client relationships
• Long-termcontract vehicles

Revenue percentages are based on Q3 2019 TTM financial performance released on November 6, 2019

12

ICF culture: a source of competitive advantage

Purpose

To build a more prosperous and resilient world for all.

Values

Interact with Integrity Bring Your Passion Embrace Differences Challenge Assumptions Work Together

Be Greater Than

13

Performance since Investor Day 2016

Revenue: GAAP EPS:

2016-2019*2016-2019*

CAGR CAGR

7.9% 16.0%

*Midpoint of 2019 guidance affirmed on November 6, 2019

Employees:

Number of full- and part-time employees

13.6%

14

Opportunity overview

Large, growing markets	Attractive margins
Federal services			Federal services	Government	Commercial specialty
(non-DoD)			(DoD) $90 - 100B	margins typically	consulting margins
$70 - 80B			per year*	range 7 - 11%	(i.e., energy) typically
per year*							low teens
Commercial	Commercial	Commercial
energy/	marketing services	marketing services
environmental	and	margins
services	technology $50B	typically mid- to
$7 - 10B per	per year**	high teens

year**

*ICF estimates based on analysis of non-set-aside contract actions from 2018 Federal Procurement Data Systems ** ICF estimates based on third-party analyst reports

15

Keys to sustained growth

Demonstrated	Roughly 50-50 split	Similar split expected
performance in 13	between organic and	to continue
years since IPO	M&A growth

16

Catalysts for continued organic growth

Federal

• Civilian agency spending
• Public health
• Next gen IT
• Citizen engagement

Marketing Services

• Personalization/loyalty
• Digital transformation
• Data convergence

State + Local

• Disaster management: recovery and mitigation
• Infrastructure spending

Commercial Energy

• Energy efficiency outsourcing
  in California
• Distributed energy resources
• Resilience planning

17

M&A focus areas

Government

Next gen IT / digital transformation

Health & Human

Services (HHS)

Citizen engagement

Commercial

Energy

Advisory services

Grid, asset + customer analytics

Distributed energy resource management

Digital transformation

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Investor Day 2019

Take a deeper	Gain greater	Meet a broader
dive into	understanding	cross-section of
growth	of ICF's unique	ICF leaders
catalysts	positioning
in key markets

19

Agenda

1. Federal Market
2. Disaster Management
3. ICF Next
4. Commercial Energy
5. Financials
6. Wrap-up
7. Q&A
8. Breakout Sessions

20

The Federal Market

Presented by:

Mark Lee, Senior Vice President, Public Sector

Jen Welham, Senior Vice President, Health and Human Services

Investor Day 2019

21

Market opportunity

Strong partnerships with nearly every federal agency

% of ICF revenues by agency*

$632B

2019 federal civilian budget

$77B+

Addressable federal civilian market

Mid-single digits

Percentage of growth in 2019 budgets

+4%

2020 federal civilian topline spending agreement

HHS 16%

DOD 6%

DOS 4%

EPA 2%

HUD 1%

DOT 1%

DOJ 1%

Other Federal 7%

Other Non-federal 62%

*ICF estimates based on analysis of non-set-aside contract actions from 2018 Federal Procurement Data Systems

*Based on Q3 2019 TTM financial performance released on November 6, 2019

22

Growth drivers

IncreasedAging

budgetsworkforce

Need for IT	Rising public
modernization	health
and enhanced	challenges
cyber protection

23

•

Differentiators

Deep subject-	Full-suite of	Diverse agency
matter	capabilities	clients
expertise

Health, energy,	IT, cybersecurity,	Work with
environment,	analytics,	numerous agencies
education, social	communications,	corresponding to
programs,	engagement, workforce	different parts of
international	development, program	Federal mission
development,	implementation,
transportation	training

Innovative approach

Named an "Industry Innovator"

Received highest scores in innovation in government brand survey

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Record business development pipeline

$B

3.8

3.6

3.4

3.2

3

2.8

2.6

2.4

2.2

2

Up ~50% over the last three years

ICF federal pipeline, 2016 - YTD 2019*

2016

2017

2018

2019

*Annual average over four quarters; average over 3 quarters for 2019

25

Technology capabilities

Data	IT	Cybersecurity	Engagement	Workforce
analytics	modernization	operations,	+ design	development
		R&D

26

Health capabilities

Deep subject matter expertise

Substance abuse (vaping, opioids) Infectious disease (HIV, malaria) Chronic disease (cancer, diabetes) Mental health (suicide prevention)

Full suite of services Disease surveillance

Research + evaluation

Survey design + data collection Training + technical assistance Translation + dissemination

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OIG

Health and Human Services Office of Inspector

General

Predictive Analytics to Fight Fraud,

Waste and Abuse

$60 - $90B

Potential prevented/recovered fraudulent Medicare funds

Leveraging	Building tools	Incorporating
advanced	that enable	user experience
data analytics	self-serve data	design elements
	queries

CASE STUDY

28

BioSense

A platform for actionable public health insights

4,000

hospitals and outpatient centers reporting

2-4M

messages processed daily

60%

of emergency dept visits reported daily

CASE STUDY

29

Disaster Management

Presented by:

Andrew LaVanway, Senior Vice President, Division Lead

Brandy Bones, Senior Director, Recovery Program Expert

Investor Day 2019

31

Market opportunity

HUD CDBG-DR market

FEMA market

Fed-funded mitigation market

Total Funding

(1992 - 2019)

Active Funding

(Addressable

now)

Active

Grants

Active

Grantees

$89.7 billion*

$38.7 billion

137

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Numbers in $Millions

20000

10000

0

2015 2016 2017 2018 2019

Annual		Supplemental

$2.4B

FEMA

HMGP

$3B

FEMA BRIC

$15.9B

CDBG-MIT

3%-10% of funding is addressable market

*Total funding for the Road Home was $9.022 billion	Source: Congressional Research Service	FEMA mitigation estimates are for next 6 years and
Source: HUD OCPD - HUDExchange.info		depend on disaster costs	32

Key trends creating a more favorable market

Unprecedented need

Lower peaks + fewer valleys

Fragmented competition

Limited talent

Extreme weather events will continue

Consistent FEMA funding (>$7 billion/year)

More emphasis on whole community recovery

Ability to find and/or build talent is critical to success

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Building on Past Success		2019			2020
	2013		2018		2019
		2018	FEMA Public	FEMA Building
2006	Manages billion-dollar	Awarded	Assistance	FEMA 406	Resilient
recoveries for N.Y.,	2 FEMA	Acquire DMS	work expanded	Mitigation	Infrastructure
Manages $9.022	N.J., and Conn.	Public	with a sizable	work	&
billion La. Road	following Superstorm	Assistance	portfolio of	New FEMA	begins in	Communities
Home Program	Sandy	contracts in	FEMA work +	wins in N.C.,	P.R.	Launches
			P.R.	personnel	La., N.Y .
Yesterday			Today			Tomorrow

2007-2011	2017-2019
Works with HUD	Delivers HUD
to "write the	CDBG-DR
book on CDBG &	Problem
CDBG-DR"	Solving Clinic
	for grantees

key FEMA CDBG-DR Mitigation

Owning a strong position in HUD

CDBG-DR disaster recovery

2018	2018	2019
Lead TA	Selected for 3	Awarded
provider to	CDBG-DR	housing
U.S.V.I.	projects in	recovery
	Tex.	program in
		P.R.

Expanding CDBG, building a strong position in FEMA disaster response and recovery

2019 2019-2020Implementing HUD N.C.'s Buyout announces

Program	rules for CDBG-
	MIT funding
	ICF Awarded
	Mo. MIT
	Planning

Using recovery as opportunity to mitigate and build resiliency

34

Supporting communities across the full disaster lifecycle and all funding sources

Mitigation Preparedness

Recovery Response

35

Putting mitigation into practice

Supporting Columbia,	Improving stormwater	Building a
South Carolina after	resilience in the	climate-ready
historic flooding	City of Miami Beach	Philadelphia

Photo credit: Cassie Bhat

36

The ICF advantage

ICF has won nearly a half-billion

dollars in contract awards across the disaster lifecycle since 2018

Our people

Working 3 of the largest disaster recovery programs in U.S. history

20+ year Federal, state and local partnerships

Training to build internal talent and capacity

Work with unwavering passion and integrity

Our approach

Operations span multiple ICF divisions

Offer capabilities across communications, energy, security, workforce development, economic analysis, data modeling and more

Breaking down barriers between recovery and resilience disciplines

Our delivery

+14,000 FEMA PA projects formulated and in progress

~$15 billion CDBG-DR funds managed and delivered to communities

Obligated $1.9B in FEMA funding in the first year, more than any other disaster in U.S. history

37

Presented by:

John Armstrong, President, ICF Next

Kris Tremaine, Managing Partner, ICF Next

40

ICF's go-to-market brand for integrated digital + engagement services

	$350M+
40%	Annual revenue across a
balanced portfolio
Government	Opportunity
60%
pipeline is +3X
Commercial
	revenue

41

Capabilities and differentiators

Loyalty

Technology

Analytics

Engagement

Strategy

Combines creativity of	Designs solutions	Built specifically to
an agency with deep	that drive real	realize the benefits
domain expertise of	participation with	of an integrated
a consultancy	customers, citizens,	model
	colleagues

42

Consumer

-

Financial

-

Government

-

Health

-

Travel

-

Hospitality

-

Energy

__

Transportation

43 43

10x Gold and	6x PR Agency of
Silver Lions	the Year
-	-
2018 Cannes	PR Week and The
Lions Festival of	Sabre Awards
Creativity (in one	(since 2014)
year)

Multi-time	Marketing	Federal
"Leader" in	Cloud	Experience
customer loyalty	Partner of	Award
solutions and in	the Year	-
digital experience	-	The Center for
-	Adobe	Digital
The Forrester WaveTM		Government

"ICF Next is probably the most prolific producer of breakthrough creative work in the industry … and it's become clear that, in most cases, the creativity drives compelling business performance for its clients."

• The Holmes Report, naming ICF Next its 2018 Specialist Agency of the Year

44

Growth drivers

Marketing technology	Customer loyalty
• Market $50B+	• Market $3.5B
• Personalization at scale	• Data convergence

Healthcare	Large federal campaigns
• Market $10B+	• Market $1.9B
• Disruption & transformation	• Citizen engagement

Sources:

1. Published NAICS codes; 2. WARC: 2019 and Beyond (US and UK MarTech Spend); 3. Maximize Market Research: 2019; 4. Private consulting report

45

Centers for Disease

Control and Prevention

Real stories of the opioid epidemic

Supporting CDC in the fight against prescription drug overdose

80%	27%
of intended	Intend to avoid using
audience	prescription opioids
saw a campaign	because of exposure to
video	the campaign

CASE STUDY

46

Fortune 100 Healthcare Client

Transforming the health of the community, one person at a time

Delivering strategy, transformation, experience, marketing and engagement initiatives

2M	2X	10/10
Enrollees from	Increase in	Continuous client
product launch	leads from paid	satisfaction rating
to becoming a	marketing	from over 150
category leader	campaign for	projects and
	open	campaigns across
	enrollment	client's business

CASE STUDY

47

Hilton Honors

"…to be the most customer centric loyalty program."

• Mark Weinstein SVP & Global Head of Customer Engagement, Loyalty and Partnerships

Hilton Honors continuous evolution, ensures the best member experience possible

100%	75%	30%
Improvement on	Faster checkout	Increase in
annual member tier	process. Members	membership
requalification	see account activity	growth
	within hours

CASE STUDY

48

Commercial Energy

Presented by:

Sergio Ostria, Executive Vice President, Energy and Infrastructure Phil Mihlmester, Executive Vice President, Energy Division Lead Shanthi Muthiah, Senior Vice President, Power Markets Expert Anne Choate, Senior Vice President, Climate and Resiliency

Investor Day 2019

50

Market transformation drives market opportunity

From central station power	To distributed power, 2-way grid
generation

51

Capabilities and differentiators

Award-winning customer engagement

Leading edge proprietary technology & analytics

Power + fuel markets

Energy efficiency implementation

Climate

changeTraining +

resiliencedevelopment

Analytics

Distributed energy resources

Customer
engagement	Delivery of over
	160 energy
	efficiency
	programs

Deep subject matter expertise

Grid modernization

52

Growth drivers

Energy	Distributed	Utility
efficiency	energy	resilience
	resources (DER)

53

Energy efficiency

Market expected to grow from $2B to $3.3B by 2030

Numerous states	EE increasingly	EE program	California
have increased	viewed as a	updates fueled	has tripled its
EE spending	grid resource	by changes	EE outsourcing
		in climate	requirement

Sources: ACEEE, LBNL, ICF analysis

54

Spotlight on California

IOUs are required to outsource 60% of EE programs by 2022 (20% today)

12 RFAs were issued in 2019 and 18 are expected in 2020

The RFP stage expected to continue into 2020

ICF's estimated addressable market: $250M+/year

ICF has responded to most RFAs with excellent success on down-selection to RFP stage

ICF is awaiting selection decisions on numerous proposals

Procurement schedules indicate contract negotiations with winning bidders in 2020

55

Distributed Energy Resources

Estimated addressable market sizes

$1-2B
Utilities challenged to	Initial utility pilot
EV market by 2030*	manage growth of	programs
$6-8B	DERs including solar,	focusing on
storage, and electric	battery storage
vehicles (EVs)	and EVs
NWA market over 10
years for load constrained substations**

$6-12B

Storage market over 20 years***

*EEI, ICF analysis

**EIA, NAS, NYPSC, ICF analysis

***EDF, ICF analysis

Total DER market could be as large as current energy efficiency market in the next 5-10 years

56

DER technology-based pilots

Planning Roadmaps Advise/Plan

Develop roadmap, sequence, priority of future initiatives

0-4 mos.

Design

Plan execution of roadmap elements, develop business case, design pilot

4-18 mos.

Implement Pilots

Develop vendor

selection,

customer

outreach

18-36 mos.

Scale and Implement Programs

Develop and implement utility programs based on pilots including programs, procurements and pricing mechanisms

18-48 mos.

Current ICF contracts

57

Helping customers control energy usage through innovative technologies

Testing smart thermostats, residential solar, battery storage and dynamic rates

Evaluating how adoption and use of these technologies impacts the grid

Global energy storage market
expected to grow to $620B by
*
2040
*Source: EDF	• 58

BGE and PHI

Incentivizing the EV market

BGE and PHI's EVsmart Pilots

• Residential EV charger rebates
• Multifamily EV charger rebates
• Public charging stations network

ICF support includes:

• Program implementation
• Marketing and advertising
• Web and IT solutions
• Events and dealership outreach
• Customer care and rebate processing
• EV subject matter expert consultation

"EEI's member companies have invested over $1 billion on customer programs and projects to deploy charging infrastructure and to accelerate electric transportation, and we fully expect that number to rise."

CASE STUDY

59

Resilience to Climate/Weather Risks

More extreme	Since 2003, the
weather events in last	average annual # of
decade than prior 2	weather-related power
decades combined	outages has doubled

$21B

Resilience spending by electric and gas utilities in 2030*

80 cities have	Regulatory activity is
named Chief	driving spending
Resilience Officers	(e.g., CA, NY)

$100M

Addressable market for ICF advisory + implementation resilience services* to energy asset owners in 2030

*Source: EIA, EEI, Brattle, ICF analysis

60

ICF-led landmark

climate vulnerability study

Regulator-driven study provides risk analysis & recommendations for assets and operations

Regulators requiring implementation

• $5.6B (~$90M/yr) required to address rising temperatures alone

CASE STUDY

61

Financial Strength

Presented by:

James Morgan, Chief Financial Officer

Investor Day 2019

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Revenue and profit growth

Revenue ($ Millions)

Non-GAAP EPS

							$1,475B - $1.500B	$5.00
$1,600							$4.50						$4.10 - $4.25
								$4.00					$3.73
$1,400							$1,338
	$1,185			$1,229		$3.50				$3.02
$1,200	$1,132						$2.87
							$3.00	$2.64
$1,000
								$2.50
$800
					CAGR			$2.00					-GAAP
											Non
					.							-
				yr
$600			5
	.2%						$2.50			yr.CAGR
	6
										5
											.4%
$400									$1.00		10
$200									$0.50
$0	2015	2016				2017	2018	2019	$0.00	2015	2016	2017**	2018	2019
								Guidance*							Guidance*

*Based on 2019 management guidance as of November 6, 2019

**2017 Non-GAAP EPS excludes the one-time benefit of a Deferred Tax Liability (DTL) revaluation for 2017, as a result of the 2017 Tax Reform Act

64

Solid margin expansion

Adjusted EBITDA to Service Revenue (SR)

14.00%

13.50%

13.00%

12.50%

12.00%

13.0%

12.7%

13.2%

13.6%

13.3% 13.4%

201420152016

• Growth over last 5 years largely organic
• Catalysts in our markets will drive continued growth

201720182019*

*Mid-point of Q319 Guidance with estimate of SR

Catalysts for continued profitability improvement

• Improved revenue mix (more higher margin work)
• Real estate / facilities consolidation
• Process improvement

•	Larger contracts; driving efficiencies	65
•	Economies of scale lowers ratio of overhead costs

Balance sheet / cash flow metrics

• Strong balance sheet
• History of strong cash flow

Balance sheet ratios (as of 9/30/19)

Current ratio	1.51x
Debt to total capital	0.26x
Leverage ratio (Debt to EBITDA)	1.86x
Bank leverage ratio* (Debt to Bank EBITDA)	1.72x

• Bank EBITDA: EBITDA plus non-cash compensation

Cash flow metrics

FCF as % of net income (1/1/15 - 9/30/19)	98%
DSO (9/30/19)	93.9
DSO excl. Puerto Rico (9/30/19)	76.0
2019 operating cash flow guidance	$80M 66

Capital allocation priorities (2019)*

Forecasted 2019 Capital Allocation of Expected Op Cash Flow (estimate as of 9/30/19)

Cash use priorities

CAPEX $27.4M

Dividends $10.5M

Support continued growth of ICF's business through M&A and capital

1	expenditures
2	Rebuild firepower (debt paydown)

	Debt
Share	repayment
repurchase	$18.7M
$23.4M

3	Maintain dividend
4	Maintain stable share count

*Expected allocation for 2019 based on achieving operating cash flow guidance

67

M&A focus areas

Government

Next gen IT / digital transformation

Health & Human

Services (HHS)

Citizen engagement

Commercial

Energy

Advisory services

Grid, asset + customer analytics

Distributed energy resource management

Digital transformation

68

Demonstrated track record

Bank Leverage Ratio

3.00x

2.50x

2.00x

1.50x

1.00x

0.50x

0.00x

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Debt to Bank EBITDA

Total Shareholder Return - TSR

800

700

600

500

400

300

200

100

-

ICF I

S&P 500

NASDAQ

2006-2019

CAGR

ICFI 15.8%

NASDAQ 10.7%

S&P 500 6.7%

69

Summary

ICF has a history	Our investor-friendly
of solid financial	financial policy supports
performance	ongoing value creation

Strong balance	Significant attention on
sheet, reliable cash	identifying appropriate
flow, and attractive	acquisition targets to
financing enables	support our focus areas
future growth	of growth

70

Investor Day 2019

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Key takeaways

Significant runway for organic growth across client set

Financial resources to support organic and acquisitive growth

Continue complementary and accretive acquisitions

Unique culture that drives excellent innovation, execution and collaboration

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