ICF International Reports Fourth Quarter and Year End 2008 Results

Fourth Quarter Core Business Revenues Increased 42.9 Percent

Year-over-Year Organic Growth Rate Was 16.0 Percent in the Fourth Quarter, 20.4
Percent for the Year

Core Business Backlog Increased 56 Percent Year over Year
FAIRFAX, Va.--(Business Wire)--
ICF International, Inc. (NASDAQ:ICFI), a leading provider of consulting services
and technology solutions to government and commercial clients, reported core
business1 revenue and earnings growth for the fourth quarter and year ended
December 31, 2008.

Fourth Quarter Results and Highlights

For the fourth quarter, core business revenue was $110.9 million, up 42.9
percent from the $77.6 million reported in last year`s fourth quarter. Total
revenue was $161.9 million and included revenue of $51.1 million from the Road
Home contract, which will be completed in June 2009. In the previous year`s
fourth quarter, total revenue was $186.4 million and included $108.8 million in
Road Home contract revenue.

"Core business revenue growth was broad-based, driven by double-digit increases
across most of our key markets, and was led by energy; climate change;
environment; and health, human services, and social programs. Organic growth for
the quarter was 16.0 percent, exclusive of the Simat, Helliesen & Eichner, Inc.
(SH&E) and Jones & Stokes acquisitions, reflecting strong demand for ICF`s
domain expertise. Advisory and implementation work for government clients
accounted for approximately 75 percent of 2008 fourth quarter core business
revenues, with the remaining 25 percent derived from commercial work," said
Sudhakar Kesavan, ICF Chairman and CEO.

Fourth quarter 2008 EBITDA2 was $15.1 million, or 9.3 percent of revenue. Net
income was $6.1 million or $0.40 per diluted share and included non-cash stock
compensation expense of $1.6 million. The weighted average number of shares
outstanding for the fourth quarter of 2008 was approximately 15.5 million
compared to approximately 15.1 million for the fourth quarter of 2007.

For the 2007 fourth quarter, the company reported net income of $9.6 million, or
$0.64 per diluted share, which included non-cash stock compensation of $1.5
million. EBITDA for the same period last year was $19.5 million, or 10.5 percent
of revenue. The company`s fourth quarter 2007 results only included 28 days of
operating results from SH&E, which ICF acquired on December 3, 2007.

"Our pace of new business wins continued to be strong in what is normally a
seasonally slower quarter, and we had significant contract wins in each of our
core markets," said Mr. Kesavan.

Backlog and New Business Awards

Backlog, excluding The Road Home contract, was $757.0 million at the end of
2008, an increase of 56 percent from fourth quarter 2007 backlog of $485.8
million and 3 percent above third quarter 2008 levels. The company`s total
backlog was $817.3 million at year-end 2008, of which 52 percent was funded.

The total value of contracts awarded in the fourth quarter of 2008 was $140.6
million.

Key contracts won in the fourth quarter included:

* Education and Youth: ICF won multiple contracts from the U.S. Department of
Health and Human Services including two new, three-year contracts with the
Administration for Children and Families (ACF) Office of Planning, Research, and
Evaluation (OPRE). These contracts have a combined value of $3.9 million. ICF
will support OPRE`s research efforts and will plan and manage its Head Start
Research Conference. ICF was also awarded a new five-year $6.6 million contract
with the ACF Children`s Bureau to develop its National Youth in Transition
Database. With the ACF`s Office of Head Start, ICF received new five-year awards
with a combined value of $40 million to provide state-based training and
technical assistance services.
* Homeland Security: ICF will support the U.S. Department of Homeland Security
(DHS) National Exercise Division in a high-priority, national terrorism
prevention exercise. The two-year task order is valued at $1.5 million. ICF was
also awarded a recompete contract valued at $9.5 million with the DHS Fraud
Detection and National Security Branch. ICF will provide project management
office services and staff to support the agency`s mission of enhancing the
integrity of the legal immigration system.
* Transportation: ICF will support the U.S. Department of Transportation,
Federal Motor Carrier Safety Administration`s mission by assisting the agency in
fulfilling its regulatory and policy development mandates to promote safe
commercial motor vehicle operation through education, regulation, enforcement,
and innovative research and technology to reduce truck and bus crashes. The
recompete, five-year contract is valued at $10 million.
* Health IT and Communications: ICF`s subsidiary, Z-Tech, was awarded a new
contract with the U.S. Department of Health and Human Services to provide
regionally based technical assistance and training for preventing the spread of
HIV/AIDS and other sexually transmitted diseases. The three-year contract is
valued at $4 million.
* Sustainable Economic Growth for Developing Countries: ICF was awarded a fourth
task order with a ceiling of $3.3 million with the Millennium Challenge
Corporation for its Tanzania program. Under the three-year contract, ICF will
provide project development, management, environmental, engineering, and
consulting services.
* Green Business: ICF won two new federal grants to promote green and efficient
buildings in China. The grants, which were awarded by the U.S. Agency for
International Development Regional Development Mission for Asia and the U.S.
Department of State, respectively, have a combined value of US$3.0 million.

Full Year 2008 Results

For the year, core business revenue was $432.6 million, up 61.6 percent from the
$267.7 million for 2007. Total revenue was $697.4 million and included $264.8
million in revenue from the Road Home contract. In 2007, total revenue was
$727.1 million and included $459.4 million in Road Home contract revenue. Full
year 2008 organic growth, exclusive of acquisitions, was 20.4 percent compared
to 10.5 percent for the full year 2007.

EBITDA was $67.1 million, or 9.6 percent of revenue. Net income was $28.7
million, or $1.88 per diluted share, compared to $40.6 million, or $2.72 per
diluted share for 2007. The weighted average number of shares outstanding in
2008 was approximately 15.3 million compared to approximately 14.9 million in
2007.

Summary and Outlook

"ICF completed 2008 with record core business revenue growth of 61.6 percent and
an average new contract win rate of 48 percent," Mr. Kesavan said. "Core
business backlog of $757.0 million provides us with important visibility
supported by the fact that no core business contract accounts for more than 2
percent of the total."

For the first quarter of fiscal 2009, the Company expects total revenues to
range from $155 million to $160 million, of which core business revenues should
account for approximately 70 percent. EBITDA margin is anticipated to be between
9 and 9.5 percent, reflecting a higher mix of government business compared to
commercial business. Earnings per diluted share are expected to range from $0.34
to $0.38, based on approximately 15.5 million weighted average shares
outstanding and a tax rate of 43.0 percent

Based on current trends and its existing portfolio of business, the Company
reaffirms its guidance for 2009, which calls for total revenues of $530 million
to $560 million, of which core business revenues are expected to be at least
$500 million, representing an organic growth rate of over 15 percent compared to
2008 levels. EBITDA margin is expected to remain in the 9 to 10 percent range
for full year 2009.

"ICF`s recognized leadership in our key markets, including energy and climate
change; environment and infrastructure; health, human services, and social
programs; and homeland security and defense, provides growth opportunities
related to the new administration`s priorities and the economic stimulus
program. We will continue to pursue those opportunities as the timing and
program details become clearer," Mr. Kesavan noted.

About ICF International

ICF International (NASDAQ: ICFI) partners with government and commercial clients
to deliver consulting services and technology solutions in the energy, climate
change, environment, transportation, social programs, health, defense, and
emergency management markets. The firm combines passion for its work with
industry expertise and innovative analytics to produce compelling results
throughout the entire program life cycle, from analysis and design through
implementation and improvement. Since 1969, ICF has been serving government at
all levels, major corporations, and multilateral institutions. Approximately
3,000 employees serve these clients worldwide. ICF`s Web site is www.icfi.com.

Caution Concerning Forward-looking Statements

This document may contain "forward-looking statements" as that term is defined
in the Private Securities Litigation Reform Act of 1995-that is, statements
related to future-not past-events, plans, and prospects. These statements
involve known and unknown risks, uncertainties, and other factors that may cause
our actual results, levels of activity, performance, or achievements to be
materially different from any future results, levels of activity, performance,
or achievements expressed or implied by such forward-looking statements. In some
cases, you can identify these statements by forward-looking words such as
"guidance," "anticipate," "believe," "could," "estimate," "expect," "intend,"
"may," "plan," "potential," "seek," "should," "will," "would," or similar words.
You should read statements that contain these words carefully because they
discuss our future expectations, contain projections of our future results of
operations or of our financial position, or state other forward-looking
information, and are subject to factors that could cause actual results to
differ materially from those anticipated. For ICF, particular uncertainties that
could adversely or positively affect the Company`s future results include but
are not limited to: risks related to the government contracting industry,
including the timely approval of government budgets, changes in client spending
priorities, and the results of government audits and investigations; risks
related to our business, including our dependence on contracts with U.S. Federal
Government agencies and departments and the State of Louisiana; continued good
relations with these and other customers; success in competitive bidding on
recompete and new contracts; performance by ICF and its subcontractors under our
contract with the State of Louisiana, Office of Community Development, including
but not limited to the risks of failure to achieve certain levels of program
activities, termination, or material modification of the contract, and political
uncertainties relating to The Road Home program; uncertainties as to whether
revenues corresponding to the Company`s contract backlog will actually be
received; the future of the energy and air transportation sectors of the global
economy; our ability to attract and retain management and staff; strategic
actions, including attempts to expand our service offerings and client base, the
ability to make acquisitions, and the performance and future integration of
acquired businesses; risks associated with operations outside the United States,
including but not limited to international, regional, and national economic
conditions, including the effects of terrorist activities, war, and currency
fluctuations; and other risks and uncertainties disclosed in the Company`s
filings with the Securities and Exchange Commission. These uncertainties may
cause ICF`s actual future results to be materially different than those
expressed in the Company`s forward-looking statements. ICF does not undertake to
update its forward-looking statements.

1 Core business represents all ICF International, Inc. revenue excluding revenue
from The Road Home Program.

2 EBITDA is a non-GAAP measurement, which adds depreciation and amortization to
operating income to derive EBITDA.

ICF International, Inc.
Consolidated Statements of Earnings
(in thousands, except per share amounts)

Three months ended CYE
Dec. 31 Dec. 31 Dec. 31 Dec. 31
2008 2007 2008 2007
Unaudited Unaudited Unaudited

Gross Revenue $ 161,934 $ 186,423 $ 697,426 $ 727,120

Direct Costs 104,864 133,893 460,002 532,153
Indirect and selling expenses 42,016 33,021 170,360 118,128
Depreciation and amortization 1,516 705 5,407 2,432
Amortization of intangible assets 2,241 1,391 8,683 3,884

Earnings from Operations 11,297 17,413 52,974 70,523

Other (Expense) Income
Interest expense (1,051 ) (552 ) (4,082 ) (1,944 )
Other income 566 29 581 519
Total Other Expense (485 ) (523 ) (3,501 ) (1,425 )

Income before income taxes 10,812 16,890 49,473 69,098

Income Tax Expense 4,670 7,270 20,750 28,542

Net Income 6,142 9,620 28,723 40,556

Earnings per Share-Basic $ 0.41 $ 0.67 $ 1.96 $ 2.87
Earnings per Share-Diluted $ 0.40 $ 0.64 $ 1.88 $ 2.72

Weighted-avg Shares O/S-Basic 14,891 14,423 14,641 14,152
Weighted-avg Shares O/S-Diluted 15,452 15,139 15,270 14,896

ICF International, Inc.
Consolidated Statements of Earnings
As a percentage of Revenues, except the tax provision

Three months ended CYE
Dec. 31 Dec. 31 Dec. 31 Dec. 31
2008 2007 2008 2007
Unaudited Unaudited Unaudited

Gross Revenue 100.0 % 100.0 % 100.0 % 100.0 %

Direct Costs 64.8 % 71.8 % 66.0 % 73.2 %
Indirect and selling expenses 25.9 % 17.7 % 24.4 % 16.2 %
Depreciation and amortization 0.9 % 0.4 % 0.8 % 0.3 %
Amortization of intangible assets 1.4 % 0.7 % 1.2 % 0.5 %

Earnings from Operations 7.0 % 9.4 % 7.6 % 9.8 %

Other (Expense) Income
Interest expense -0.6 % -0.3 % -0.6 % -0.3 %
Other 0.3 % 0.0 % 0.1 % 0.1 %
Total Other Expense -0.3 % -0.3 % -0.5 % -0.2 %

Income before income taxes 6.7 % 9.1 % 7.1 % 9.6 %

Income Tax Expense 43.2 % 43.0 % 41.9 % 41.3 %

Net Income 3.8 % 5.2 % 4.1 % 5.7 %

ICF International, Inc., and Subsidiaries
Consolidated Balance Sheets

December 31, 2008 2007
(in thousands of dollars) (Unaudited)

Assets

Current Assets
Cash and cash equivalents $ 1,536 $ 2,733
Contract receivables, net 150,778 190,159
Prepaid expenses and other 4,507 3,955
Income tax receivable 3,530 1,933
Restricted Cash 2,180 -
Deferred income taxes 4,186 3,902
Total Current Assets 166,717 202,682
Total property and equipment, net 13,373 7,541
Goodwill 198,724 159,491
Other intangible assets, net 16,844 17,710
Restricted cash 2,078 3,668
Other assets 3,281 1,933
Total Assets $ 401,017 $ 393,025

Liabilities and Stockholders` Equity

Current Liabilities
Accounts payable $ 27,740 $ 74,260
Accrued salaries and benefits 27,405 27,801
Accrued expenses 35,295 47,084
Deferred revenue 12,352 16,067
Total Current Liabilities 102,792 165,212
Long-term debt 80,000 47,079
Deferred rent 2,361 1,773
Deferred income taxes 10,849 9,109
Other 2,098 5,061
Total Liabilities 198,100 228,234
Commitments and Contingencies - -
Stockholders` Equity
Preferred stock, par value $.001 per share; 5,000,000 shares authorized; none issued - -
Common stock, $.001 par value; 70,000,000 shares authorized,
15,188,320 and 14,593,723 shares issued; and
15,106,522 and 14,531,521 shares outstanding 15 15
Additional paid-in capital 120,550 109,795
Retained earnings 84,110 55,387
Treasury stock (1,474 ) (746 )
Stockholder notes receivable (12 ) (21 )
Accumulated other comprehensive income (272 ) 361
Total Stockholders` Equity 202,917 164,791
Total Liabilities and Stockholders` Equity $ 401,017 $ 393,025

ICF International, Inc., and Subsidiaries
Consolidated Statements of Cash Flows

Year ended December 31, 2008 2007
(in thousands of dollars) (Unaudited)

Cash Flows from Operating Activities
Net income $ 28,723 $ 40,556
Adjustments to reconcile net income to net cash
provided by operating activities:
Accrued interest on stockholder notes - (21 )
Bad debt expense 422 2,376
Deferred income taxes (2,931 ) (1,815 )
Loss on disposal of fixed assets 127 68
Abandonment of leased space - -
Non-cash equity compensation 6,473 3,680
Depreciation and amortization 14,090 6,316
Changes in operating assets and liabilities:
Contract receivables, net 57,022 (62,695 )
Prepaid expenses and other 598 (860 )
Accounts payable (50,654 ) 53,255
Accrued salaries and benefits (4,219 ) 2,771
Accrued expenses (12,608 ) 9,850
Deferred revenue (3,834 ) (2,512 )
Income tax receivable/payable (2,354 ) (4,348 )
Deferred rent 567 (7 )
Other liabilities (3,373 ) (1,151 )

Net Cash Provided by Operating Activities 28,049 45,463

Cash Flows from Investing Activities
Capital expenditures (9,929 ) (3,662 )
Payments for business acquisitions, net of cash received (51,422 ) (96,392 )
Payments for trademark applications - (14 )
Capitalized software development costs (341 ) (130 )

Net Cash Used in Investing Activities (61,692 ) (100,198 )

Cash Flows from Financing Activities
Advances from working capital facilities 270,949 334,608
Payments on working capital facilities (238,028 ) (287,529 )
Restricted cash related to Caliber acquisition 1,325 2,147
Restricted cash (3,415 ) (2,112 )
Debt issue costs (1,315 ) (142 )
Proceeds from initial public offering - 12
Exercise of options 2,127 3,925
Tax benefits of stock option exercises 3,271 3,034
Issuances of stock 485 246
Purchases of stock for treasury (2,329 ) (414 )
Payments received on stockholder notes 9 562

Net Cash Provided by (Used In) Financing Activities 33,079 54,337
Effect of Exchange Rate on Cash (633 ) 134
Decrease in Cash (1,197 ) (264 )
Cash, beginning of year 2,733 2,997
Cash, end of year $ 1,536 $ 2,733
Supplemental disclosures of cash flow information:
Cash paid during the period:
Interest $ 4,505 $ 1,476
Income taxes $ 24,445 $ 31,839

ICF International, Inc.
Douglas Beck, 1-703-934-3820
or
MBS Value Partners
Lynn Morgen/Betsy Brod, 1-212-750-5800

Copyright Business Wire 2009