DLH Holdings' Q1 revenue falls 24.1% due to program transitions

Overview

• Digital transformation provider's fiscal Q1 revenue fell 24.1% yr/yr due to program transitions

• Adjusted EBITDA for fiscal Q1 was $6.5 mln, benefiting from cost reduction initiatives

• Company's debt rose modestly due to short-term working capital needs

Outlook

• DLH plans to use operating cash flow to reduce debt levels in fiscal 2026

• Company aims to align expenses with revenue volumes and restore margins

Result Drivers

• PROGRAM TRANSITIONS - Revenue decline attributed to transition of programs to small-business set-aside contractors

• COST REDUCTION - Adjusted EBITDA benefited from initiatives to reduce costs and streamline operations

• DEBT MANAGEMENT - Debt rose due to short-term working capital needs

Key Details

Analyst Coverage

• The one available analyst rating on the shares is "buy"

• The average consensus recommendation for the it services & consulting peer group is "buy"

• Wall Street's median 12-month price target for DLH Holdings Corp is $10.00, about 70.4% above its February 6 closing price of $5.87

Press Release: ID:nGNX1GzlYs

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