UPDATE 1-CACI profit rises on intelligence, military work

(Adds outlook, analysts' estimates)

NEW YORK, April 30 (Reuters) - CACI International Inc CAI.N said on Wednesday quarterly profit rose a greater-than-expected 21 percent, helped by higher sales of its technology services to the U.S. military and intelligence agencies.

Companies like CACI, which runs information technology (IT) projects for many branches of the U.S. armed forces and federal government, have thrived in the past few years as the United States outsourced more technology and security work to private contractors.

CACI, based in Arlington, Virginia, reported fiscal third-quarter profit of $22.3 million, or 73 cents per share, compared with $18.4 million, or 59 cents per share, in the year-ago quarter.

That beat Wall Street's average forecast of 69 cents per share, according to Reuters Estimates.

Sales rose 34 percent to $634 million, helped by a strong increase in work for intelligence agencies, well ahead of analysts' average forecast of $585 million.

"We believe there will continue to be priority funding in national defense, intelligence, and government transformation," CACI's chief executive Paul Cofoni said in a statement.

CACI warned last year that the government's spending priorities on frontline operations in Iraq and Afghanistan were making funding of some non-priority technology projects uncertain.

But Cofoni said on Wednesday that planners in federal agencies were adapting to the administration's use of supplemental defense budgets, and were making funding available more readily for the sort of projects CACI is involved with.

"They've picked up the rhythm of the supplemental," said Cofoni in a telephone interview. "They are less nervous about allocating the funding. That is the major change we have seen."

This year, President George W. Bush's administration has already asked Congress for $70 billion in supplemental defense spending to cover Iraq and Afghanistan, and is expected to ask for $100 billion more. That is on top of the record $515 billion it has proposed for the standard defense budget for 2009.

With more clarity on funding for projects, CACI narrowed its full-year earnings forecast to a range of $2.65 to $2.75 per share, from its last forecast of $2.60 to $2.80 per share made in January. Wall Street is expecting $2.70 per share, on average.

CACI forecast full-year revenue of $2.375 billion to $2.425 billion. Analysts are expecting $2.34 billion, on average. (Reporting by Bill Rigby, Editing by Toni Reinhold)