MAXIMUS Q3 Profit Rises; Lifts 2017 EPS View

(RTTNews) - MAXIMUS (MMS), a provider of government services worldwide, reported that its net income attributable to the company for the third quarter of fiscal 2017 totaled $56.9 million or $0.86 per share up from $52.2 million or $0.79 per share last year.

Better-than-expected earnings per share were primarily due to benefits for research and development tax credits in the United States and Canada. During the third quarter, the Company recorded tax credits of $3.7 million (or $0.06 of earnings per share) related to tax returns for years prior to fiscal year 2017. In addition, the Company had favorable results of approximately $0.01 of earnings per share principally due to other income and the gain on sale of the K-12 education business. The remainder of the over-delivery was attributable to performance.

For the third quarter of fiscal 2017, revenue decreased 3% to $600.4 million compared to $617.1 million reported for the same period last year. The decline was principally due to foreign currency impacts and the expected wind down of a subcontract in the U.S. Federal Services Segment. On a constant currency basis, revenue would have declined 1%.

Analysts polled by Thomson Reuters expected the company to report earnings of $0.76 per share and revenues of $613.12 million. Analysts' estimates typically exclude special items.

MAXIMUS reiterated its revenue guidance and continues to expect revenue to range between $2.425 billion and $2.475 billion for fiscal 2017 with a bias toward the bottom end of the range.

Primarily due to the benefit from the research and development tax credits recorded in the third quarter, MAXIMUS raised its fiscal 2017 earnings guidance and now expects GAAP earnings per share to range between $3.05 and $3.15 for fiscal 2017. This compares to the Company's prior guidance of $3.00 to $3.10.

Wall Street currently is looking for fiscal year 2017 earnings of $3.05 per share on annual revenues of $2.46 billion.