CACI INTERNATIONAL INC The following discussion and analysis of our financial condition and results of
operations is provided to enhance the understanding of, and should be read
together with, our consolidated financial statements and the Notes to those
statements that appear elsewhere in this Annual Report on Form 10-K. This
discussion contains forward-looking statements that involve risks and
uncertainties. Unless otherwise specifically noted, all years refer to our
fiscal year which ends on
Overview
We are a leading provider of Expertise and Technology to Enterprise and Mission
customers, supporting national security missions and government
modernization/transformation in the intelligence, defense, and federal civilian
sectors. The demand for our Expertise and Technology, in large measure, is
created by the increasingly complex network, systems, and information
environments in which governments and businesses operate, and by the need to
stay current with emerging technology while increasing productivity, enhancing
security, and, ultimately, improving performance.
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Some of our key initiatives include the following:
• Continue to grow organic revenue across our large, addressable market;
• Recruit and hire a world class workforce to execute on our growing backlog;
• Deliver strong profitability and robust cash flows from operations;
• Differentiate ourselves through our investment, including our strategic
mergers and acquisition program allowing us to enhance our current
capabilities and create new customer access points; and
• Continue our unwavering commitment to our customers while supporting the
communities in which we work and live.
Budget Environment
We carefully follow federal budget, legislative and contracting trends and activities and evolve our strategies to take these into consideration. OnAugust 2, 2019 , the Bipartisan Budget Act of 2019 (BBA 2019) was signed into law. BBA 2019 called for defense spending, including Overseas Contingency Operations (OCO) funds, of$738 billion in government fiscal year (GFY) 2020 and$740.5 billion in GFY 2021. Both represent increases from GFY 2019 levels of$716 billion . OnJanuary 1, 2021 , the$740 billion National Defense Authorization Act (NDAA) for GFY 2021 became law. For GFY 2022, the Biden administration has released a budget proposal that calls for an increase in aggregate defense spending of 1.6% from GFY 2021. We believe that bipartisan support remains for continued investment in the areas of defense and national security. While we view the budget environment as stable and believe there is bipartisan support for continued investment in the areas of defense and national security, it is uncertain when in any particular GFY that appropriations bills will be passed. During those periods of time when appropriations bills have not been passed and signed into law, government agencies operate under a continuing resolution (CR). Depending on their scope, duration, and other factors, CRs can negatively impact our business due to delays in new program starts, delays in contract award decisions, and other factors. When a CR expires, unless appropriations bills have been passed byCongress and signed by the President, or a new CR is passed and signed into law, the government must cease operations, or shutdown, except in certain emergency situations or when the law authorizes continued activity. We continuously review our operations in an attempt to identify programs potentially at risk from CRs so that we can consider appropriate contingency plans.
Market Environment
Across our addressable market, we provide Expertise and Technology to government Enterprise and Mission customers. Based on the analysis of an independent market consultant retained by the Company, we believe that the total addressable market for our offerings is approximately$230 billion . Our addressable market is expected to continue to grow over the next several years. Approximately 70 percent of our revenue comes from defense-related customers, including those in the Intelligence Community (IC), with additional revenue coming from non-defense IC, homeland security, and other federal civilian customers. We continue to align the Company's capabilities with well-funded budget priorities and took steps to maintain a competitive cost structure in line with our expectations of future business opportunities. In light of these actions, as well as the budgetary environment discussed above, we believe we are well positioned to continue to win new business in our large addressable market. We believe that the following trends will influence the USG's spending in our addressable market: • A stable USG budget environment, particularly in defense and intelligence-related areas; • A shift in focus from readiness toward increased capabilities, effectiveness, and responsiveness;
• Increased USG interest in faster contracting and acquisition processes;
• Increased focus on cyber, space, and the electromagnetic spectrum as key
domains for National Security;
• Continued focus on counterterrorism, counterintelligence, and counter
proliferation as key
• Balanced focus on enterprise cost reductions through efficiency, with
increased spend on IT infrastructure modernization and enhancements to
cyber security protections; and
• Increased investments in advanced technologies (e.g., Artificial
Intelligence, 5G).
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-------------------------------------------------------------------------------- We believe that our customers' use of lowest price/technically acceptable (LPTA) procurements, which contributed to pricing pressures in prior years, has moderated, though price still remains an important factor in procurements. We also continue to see protests of major contract awards and delays in USG procurement activities. In addition, many of our federal government contracts require us to employ personnel with security clearances, specific levels of education and specific past work experience. Depending on the level of clearance, security clearances can be difficult and time-consuming to obtain and competition for skilled personnel in the information technology services industry is intense. Additional factors that could affect USG spending in our addressable market include changes in set-asides for small businesses, changes in budget priorities as a result of the COVID-19 pandemic, and budgetary priorities limiting or delaying federal government spending in general.
Critical Accounting Policies and Estimates
The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in theU.S. requires us to make estimates and judgments that affect the amounts reported in those financial statements and accompanying notes. We consider the accounting policies and estimates addressed below to be the most important to our financial position and results of operations, either because of the significance of the financial statement item or because they require the exercise of significant judgment and/or use of significant estimates. Although we believe that the estimates are reasonable based on reasonably available facts, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods may differ.
We believe the following accounting policies require significant judgment due to the complex nature of the underlying transactions:
Revenue Recognition
The Company generates almost all of our revenue from three different types of contractual arrangements with theU.S. government: cost-plus-fee, fixed-price, and time-and-materials (T&M) contracts. Our contracts with theU.S. government are generally subject to the Federal Acquisition Regulation (FAR) and are competitively priced based on estimated costs of providing the contractual goods or services. We account for a contract when the parties have approved the contract and are committed to perform on it, the rights of each party and the payment terms are identified, the contract has commercial substance, and it is probable that we will collect substantially all of the consideration. At contract inception, the Company determines whether the goods or services to be provided are to be accounted for as a single performance obligation or as multiple performance obligations. This evaluation requires professional judgment as it may impact the timing and pattern of revenue recognition. If multiple performance obligations are identified, we generally use the cost plus a margin approach to determine the relative standalone selling price of each performance obligation. When determining the total transaction price, the Company identifies both fixed and variable consideration elements within the contract. Variable consideration includes any amount within the transaction price that is not fixed, such as: award or incentive fees; performance penalties; unfunded contract value; or other similar items. For our contracts with award or incentive fees, the Company estimates the total amount of award or incentive fee expected to be recognized into revenue. Throughout the performance period, we recognize as revenue a constrained amount of variable consideration only to the extent that it is probable that a significant reversal of the cumulative amount recognized to date will not be required in a subsequent period. Our estimate of variable consideration is periodically adjusted based on significant changes in relevant facts and circumstances. In the period in which we can calculate the final amount of award or incentive fee earned - based on the receipt of the customer's final performance score or determining that more objective, contractually-defined criteria have been fully satisfied - the Company will adjust our cumulative revenue recognized to date on the contract. This adjustment to revenue will be disclosed as the amount of revenue recognized in the current period for a previously satisfied performance obligation. We generally recognize revenue over time throughout the performance period as the customer simultaneously receives and consumes the benefits provided on our services-type revenue arrangements. This continuous transfer of control for ourU.S. government contracts is supported by the unilateral right of our customer to terminate the contract for a variety of reasons without having to provide justification for its decision. For our services-type revenue arrangements in which there are a repetitive amount of services that are substantially the same from one month to the next, the Company applies the series guidance. We use a variety of input and output methods that approximate the progress towards complete satisfaction of the performance obligation, including: costs incurred, labor hours expended, and time-elapsed measures for our fixed-price stand ready obligations. For certain contracts, primarily our cost-plus and T&M services-type revenue arrangements, we apply the right-to-invoice practical expedient in which revenue is recognized in direct proportion to our present right to consideration for progress towards the complete satisfaction of the performance obligation. 26
-------------------------------------------------------------------------------- When a performance obligation has a significant degree of interrelation or interdependence between one month's deliverables and the next, when there is an award or incentive fee, or when there is a significant degree of customization or modification, the Company generally records revenue using a percentage of completion method. For these revenue arrangements, substantially all revenue is recognized over time using a cost-to-cost input method based on the ratio of costs incurred to date to total estimated costs at completion. When estimates of total costs to be incurred on a contract exceed total revenue, a provision for the entire loss on the contract is recorded in the period in which the loss is determined. Contract modifications are reviewed to determine whether they should be accounted for as part of the original performance obligation or as a separate contract. When a contract modification changes the scope or price and the additional performance obligations are at their standalone selling price, the original contract is terminated and the Company accounts for the change prospectively when the new goods or services to be transferred are distinct from those already provided. When the contract modification includes goods or services that are not distinct from those already provided, the Company records a cumulative adjustment to revenue based on a remeasurement of progress towards the complete satisfaction of the not yet fully delivered performance obligation. Based on the critical nature of our contractual performance obligations, the Company may proceed with work based on customer direction prior to the completion and signing of formal contract documents. The Company has a formal review process for approving any such work that considers previous experiences with the customer, communications with the customer regarding funding status, and our knowledge of available funding for the contract or program.
Accounting for Business Combinations,
The purchase price of an acquired business is allocated to the tangible assets and separately identifiable intangible assets acquired less liabilities assumed based upon their respective fair values, with the excess recorded as goodwill. The fair values of the assets acquired and liabilities assumed were preliminarily determined using income, market and cost valuation methods. The income approach was primarily used to value the customer relationships intangible assets. The income approach indicates value for an asset or liability based on the present value of cash flow projected to be generated over the remaining economic life of the asset or liability being measured. Both the amount and the duration of the cash flows are considered from a market participant perspective. Our estimates of market participant net cash flows considered historical and projected pricing, operational performance including company specific synergies, material and labor pricing, and other relevant customer, contractual and market factors. Where appropriate, the net cash flows are adjusted to reflect the uncertainties associated with the underlying assumptions, as well as the risk profile of the net cash flows utilized in the valuation. The adjusted future cash flows are then discounted to present value using an appropriate discount rate. Projected cash flow is discounted at a required rate of return that reflects the relative risk of achieving the cash flow and the time value of money. The fair values of the tangible assets and acquired liabilities assumed, were determined using a combination of market and cost valuation methods. The market approach is a valuation technique that uses prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities, or a group of assets and liabilities. Valuation techniques consistent with the market approach often use market multiples derived from a set of comparables. The cost approach, which estimates value by determining the current cost of replacing an asset with another of equivalent economic utility. We evaluate goodwill at least annually for impairment, or whenever events or circumstances indicate that the carrying value may not be recoverable. The evaluation includes comparing the fair value of the relevant reporting unit to the carrying value, including goodwill, of such unit. The level at which we test goodwill for impairment requires us to determine whether the operations below our operating segments constitute a self-sustaining business for which discrete financial information is available and segment management regularly reviews the operating results. If the fair value exceeds the carrying value, no impairment loss is recognized. However, if the carrying value of the reporting unit exceeds its fair value, the goodwill of the reporting unit may be impaired. Impairment is measured by comparing the derived fair value of the goodwill to its carrying value. Separately identifiable intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment if impairment indicators are present. We estimate the fair value of our reporting units using both an income approach and a market approach. The valuation process considers our estimates of the future operating performance of each reporting unit. Companies in similar industries are researched and analyzed and we consider the domestic and international economic and financial market conditions, both in general and specific to the industry in which we operate, prevailing as of the valuation date. The income approach utilizes discounted cash flows. We evaluate goodwill as of the first day of the fiscal fourth quarter. In addition, we will perform interim impairment testing should circumstances requiring it arise. We completed our annual goodwill assessment as ofApril 1, 2021 and no impairment charge was necessary as a result of this assessment. We have concluded that none of our reporting units are at risk of a goodwill impairment in the near term as their fair values are considerably greater than their carrying values. 27
-------------------------------------------------------------------------------- Determining the fair values of the reporting units inherently involves management judgments regarding assumptions such as future sales, profits and cash flows, determination of the discount rate, weighting of the income and market approaches, and the effect of the market conditions on those assumptions. Due to the variables inherent in the estimation of a reporting unit's fair value and the relative size of our goodwill, differences in assumptions could have a material effect on one or more of our reporting units and could result in a goodwill impairment charge in a future period.
Recent Accounting Pronouncements
See Note 3, Recently Issued Accounting Pronouncements, in the Notes to Consolidated Financial Statements contained in this Annual Report on Form 10-K for additional information.
Results of Operations
The following table sets forth the relative percentage that certain items of
expense and earnings bear to revenue for the three most recent fiscal years
ended.
Consolidated Statements of Operations
Years ended June 30,
Year to Year Change
2021 2020 2019 2020 to 2021 2019 to 2020
Dollars Dollars Percent Dollars Percent
(dollar amounts in thousands)
Revenue $ 6,044,135 $ 5,720,042 $ 4,986,341 $
324,093 5.7 %
3,930,707 3,719,056 3,304,053 211,651 5.7 415,003 12.6
Indirect costs and
selling
expenses 1,448,614 1,432,602 1,218,544 16,012 1.1 214,058 17.6
Depreciation and
amortization 125,363 110,688 85,877 14,675 13.3 24,811 28.9
Total costs of revenue 5,504,684 5,262,346 4,608,474 242,338 4.6 653,872 14.2
Income from operations 539,451 457,696 377,867 81,755 17.9 79,829 21.1
Interest expense and
other, net 39,836 56,059 49,958 (16,223 ) (28.9 ) 6,101 12.2
Income before income
taxes 499,615 401,637 327,909 97,978 24.4 73,728 22.5
Income taxes 42,172 80,157 62,305 (37,985 ) (47.4 ) 17,852 28.7
Net income $ 457,443 $ 321,480 $ 265,604 $ 135,963 42.3 $ 55,876 21.0
Revenue. For the twelve months ended June 30, 2021 , total revenue was $6.0
billion , 5.7 percent greater than last year with 5.0 percent from organic
revenue growth. The remaining growth in revenue was attributable to acquired
revenues. Out of our primary customer groups, Department of Defense and Federal
Civilian revenue increased by $186.0 million and $117.9 million , respectively,
compared with the same period a year ago.
The following table summarizes revenue by customer type with related percentages of revenue for the three most recent fiscal years:
Years Ended June 30,
2021 2020 2019
(dollars in thousands)
Department of Defense $ 4,185,292 69.3 % $ 3,999,261 69.9 % $ 3,489,854 70.0 %
Federal Civilian Agencies 1,585,672 26.2 1,467,801 25.7 1,263,681 25.3
Commercial and other 273,171 4.5 252,980 4.4 232,806 4.7
Total $ 6,044,135 100.0 % $ 5,720,042 100.0 % $ 4,986,341 100.0 %
•
single largest customer, where our services focus on supporting readiness,
tactical military intelligence, and communications systems.
also includes contracts with the
• Federal civilian agencies' revenue primarily includes services and products
provided to non-
government, including intelligence agencies and Departments of Justice,
Agriculture, Health and Human Services , and State.
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• Commercial and other revenue primarily includes services and products
provided to U.S. state and local governments, commercial customers, and
certain foreign governments and agencies through our International
reportable segment.
Direct Costs. For the twelve months ended June 30, 2021 , direct costs increased
by $211.7 million or 5.7 percent, compared with the same period a year ago. The
increase is primarily related to direct and subcontractor labor costs from
organic growth on existing programs and higher other direct costs against our
revenue arrangements, partially offset by a reduction in travel related
expenses. As a percentage of revenue, total direct costs were 65.0 percent and
65.0 percent, respectively, for FY2021 and FY2020.
Indirect Costs and Selling Expenses. For the twelve months ended June 30, 2021 ,
indirect costs and selling expenses increased by $16.0 million or 1.1 percent,
compared with the same period a year ago. The increase is primarily related
to increased labor-related expenses, including fringe benefits, and purchases of
other professional services, partially offset by reduced indirect travel,
incentive compensation and bid and proposal (B&P) costs.
Depreciation and Amortization. For the twelve months ended
Interest Expense and Other, Net. For the twelve months ended
Income Taxes. The effective income tax rate in FY2021, FY2020, and FY2019, was 8.4 percent, 20.0 percent, and 19.0 percent, respectively. The effective income tax rate decreased in FY2021 primarily as a result of the$56.2 million benefit related to the carryback of the federal tax net operating loss (NOL) pursuant to provisions under the CARES Act (see Note 20), as well as an increase in research and development credits for past and current year tax filings.
Contract Backlog
The Company's backlog represents total value on our existing contracts that has the potential to be recognized into revenue as work is performed. The Company includes unexercised option years in its backlog amount and excludes task orders that may be issued underneath a multiple award IDIQ vehicle until such task orders are awarded.
The Company's backlog as of period end is either funded or unfunded:
• Funded backlog represents contract value appropriated by a customer that is
expected to be recognized into revenue.
• Unfunded backlog represents the sum of unappropriated contract value on
executed contracts and unexercised option years that is expected to be
recognized into revenue.
As of June 30, 2021 , the Company had total backlog of $24.2 billion , compared
with $21.6 billion a year ago, an increase of 12.0 percent. Contract awards in
FY2021 were $9.2 billion , a decrease of 20.7 percent compared with the same
period a year ago. Funded backlog as of June 30, 2021 was $3.3 billion . The
total backlog consists of remaining performance obligations (see Note 11,
Revenue Recognition, in the Notes to Consolidated Financial Statements contained
in this Annual Report on Form 10-K) plus unexercised options.
There is no assurance that all funded or potential contract value will result in
revenue being recognized. The Company continues to monitor our backlog as it is
subject to change from execution of new contracts, contract modifications or
extensions, government deobligations, or early terminations. Based on this
analysis, an adjustment to the period end balance may be required.
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--------------------------------------------------------------------------------Revenue by Contract Type
The Company generates revenue under three basic contract types:
• Cost-plus-fee contracts: This contract type provides for reimbursement of
allowable direct expenses and allocable indirect expenses plus an
additional negotiated fee. The fee component of the contract may include
fixed fees, award fees and incentive fees. Fixed fees are fees that are
negotiated and fixed at the inception of the contract. In general, award
fees are more subjective in performance criteria and are earned based on
overall cost, schedule, and technical performance as measured against
contractual requirements. Incentive fees have more objective cost or
performance criteria and generally contain a formula based on the
relationship of actual costs incurred to target costs.
• Firm fixed-price contracts: This contract type provides for a fixed price
for specified products, systems, and services and is often used when there
is more certainty regarding the estimated costs to complete the contractual
statement of work. Since the contractor bears the risk of cost overruns,
there is higher risk and potential profit associated with this contract
type.
• Time and materials contracts: This contract type provides for a fixed
hourly rate for defined contractual labor categories, with reimbursement of
billable material and other direct costs. For this contract type, the
contractor bears the risk that its labor costs and allocable indirect
expenses are greater than the fixed hourly rate defined within the
contract.
As discussed further within Item 1A, Risk Factors in this Annual Report on Form
10-K, our earnings and margins may vary based on the mix of our contract
types. We generated the following revenue on our cost-plus-fee, fixed-price, and
time-and-materials contracts during each of the last three fiscal years:
Years Ended June 30,
2021 2020 2019
(dollars in thousands)
Cost-plus-fee $ 3,504,838 58.0 % $ 3,274,707 57.2 % $ 2,764,291 55.4 %
Firm fixed-price 1,769,841 29.3 1,629,475 28.5 1,465,559 29.4
Time and materials 769,456 12.7 815,860 14.3 756,491 15.2
Total $ 6,044,135 100.0 % $ 5,720,042 100.0 % $ 4,986,341 100.0 %
Effects of Inflation
During FY2021, 58.0 percent of our revenue was generated under cost-reimbursable
contracts which automatically adjust revenue to cover costs that are affected by
inflation. 12.7 percent of our revenue was generated under T&M contracts, where
labor rates for many of the services provided are often fixed for several years.
Under certain T&M contracts containing IDIQ procurement arrangements, we adjust
labor rates annually as permitted. The remaining portion of our business is
fixed-price and may span multiple years. We generally have been able to price
our T&M and fixed-price contracts in a manner that accommodates the rates of
inflation experienced in recent years.
Liquidity and Capital Resources
To date, COVID-19 has not had a significant impact on our liquidity, cash flows or capital resources. However, the continued spread of COVID-19 has led to disruption and volatility in the global capital markets, which, depending on future developments, could impact our capital resources and liquidity in the future. Existing cash and cash equivalents and cash generated by operations are our primary sources of liquidity, as well as sales of receivables under our MARPA (as defined and discussed in Note 14) and available borrowings under our Credit Facility (as defined in Note 15) described below. The Company has a$2,438.4 million Credit Facility, which consists of an$1,500.0 million Revolving Facility and a$938.4 million Term Loan. The Revolving Facility is a secured facility that permits continuously renewable borrowings and has subfacilities of$100.0 million for same-day swing line borrowings and$25.0 million for stand-by letters of credit. As ofJune 30, 2021 ,$797.6 million was outstanding under the Term Loan,$945.0 million was outstanding under the Revolving Facility and no borrowings on the swing line. The Term Loan is a five-year secured facility under which principal payments are due in quarterly installments of$11.7 million until the balance is due in full onJune 30, 2024 . 30
-------------------------------------------------------------------------------- The interest rates applicable to loans under the Credit Facility are floating interest rates that, at our option, equal a base rate or a Eurodollar rate plus, in each case, an applicable margin based upon our consolidated total leverage ratio. The Credit Facility requires us to comply with certain financial covenants, including a maximum total leverage ratio and a minimum interest coverage ratio. The Credit Facility also includes customary negative covenants restricting or limiting our ability to guarantee or incur additional indebtedness, grant liens or other security interests to third parties, make loans or investments, transfer assets, declare dividends or redeem or repurchase capital stock or make other distributions, prepay subordinated indebtedness and engage in mergers, acquisitions or other business combinations, in each case except as expressly permitted under the Credit Facility. Since the inception of the Credit Facility, we have been in compliance with all of the financial covenants. A majority of our assets serve as collateral under the Credit Facility.
A summary of the change in cash and cash equivalents is presented below:
Years Ended June 30,
2021 2020 2019
(dollar amounts in thousands)
Net cash provided by operating activities
$ 555,297 Net cash used in investing activities (426,646 ) (178,529 ) (1,127,982 ) Net cash provided by (used in) financing activities (190,596 ) (303,394 )
579,556
Effect of exchange rate changes on cash 5,822 (1,574 ) (1,037 ) Net change in cash and cash equivalents (19,205 ) 35,208
5,834
Cash and cash equivalents were
Our operating cash flow was$592.2 million and$518.7 million for FY2021 and FY2020, respectively. This represents an increase of$73.5 million or 14.2 percent. The year-over-year increase primarily relates to increases of$136.0 million in FY2021 net income and$52.5 million related to deferrals of employer related social security taxes under the CARES Act, partially offset by$89.6 million of other net unfavorable working capital changes and a$25.4 million decrease in net cash received from the Company's MARPA. Cash used in investing activities was$426.6 million and$178.5 million during FY2021 and FY2020, respectively. During FY2021 we paid$356.3 million for business acquisitions, as compared to$106.2 million during FY2020. Capital expenditures of$73.1 million and$72.3 million during FY2021 and FY2020, respectively, accounted for a majority of the remaining funds used in investing activities. Cash used in financing activities was$190.6 million and$303.4 million during FY2021 and FY2020, respectively. During FY2021, we had net borrowings of$329.1 million under our Credit Facility compared to net repayments of$262.9 million in FY2020. During FY2021, our net borrowings were primarily used to finance the$500.0 million repurchase of our common stock (as discussed in Note 26). During FY2021 and FY2020 we also paid taxes on the settlement of employee equity transactions of$19.7 million and$31.4 million , respectively. We believe that the combination of internally generated funds, available bank borrowings, and cash and cash equivalents on hand will provide the required liquidity and capital resources necessary to fund on-going operations, customary capital expenditures, debt service obligations, and other working capital requirements over the next twelve months. We may in the future seek to borrow additional amounts under a long-term debt security. Over the longer term, our ability to generate sufficient cash flows from operations necessary to fulfill the obligations under the Credit Facility and any other indebtedness we may incur will depend on our future financial performance which will be affected by many factors outside of our control, including current worldwide economic conditions and financial market conditions. 31
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Off-Balance Sheet Arrangements and Contractual Obligations
We have no material off-balance sheet financing arrangements. We had contractual commitments to repay debt, make payments under operating leases, and settle tax and other liabilities. The following table summarizes our contractual obligations as ofJune 30, 2021 that require us to make future cash payments: Payments Due by Period Less than 1 to 3 3 to 5 More than Total 1 year years years 5 years (amounts in thousands) Contractual obligations (1): Bank credit facility-term loan (2)$ 797,635 $ 46,920 $ 750,715 $ - $ - Bank credit facility-revolver loan (2) 945,000 - 945,000 - - Interest payments (3) 58,316 22,624 35,692 - - Operating leases (4) 466,826 72,160 150,286 116,572 127,808 Deferred consideration (5) 830 830 - - - Other long-term liabilities Deferred compensation (6) 124,020 19,530 9,399 5,509 89,582 Transition tax (7) 5,071 575 2,623 1,873 - Deferred payroll taxes (8) 93,120 46,560 46,560 - - Total$ 2,490,818 $ 209,199 $ 1,940,275 $ 123,954 $ 217,390
(1) The liability related to unrecognized tax benefits has been excluded from the
contractual obligations table because a reasonable estimate of the timing and
amount of cash out flows from future tax settlements cannot be
determined. See Note 20 for additional information regarding taxes and
related matters.
(2) See Note 15 to our consolidated financial statements for additional
information regarding debt and related matters.
(3) Interest payments are estimated through the maturity date of the Term
Loan. Variable rate interest obligations are estimated based on rates as of
excluded because a reasonable estimate of the timing and amount of cash out
flows cannot be determined.
(4) See Note 16 to our consolidated financial statements for additional
information regarding operating lease commitments.
(5) Represents deferred payment obligations related to acquisitions.
(6) This liability is substantially offset by COLI assets held by the Company to
fund the payment of the liability to the plan participant. See Note 21.
(7) Represents transition tax related to the Tax Cuts and Jobs Act (TCJA).
(8) Represents deferred payments of the employer portion of social security taxes
as permitted under the CARES Act.
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