DLH reported $3.4 million in adjusted EBITDA and $4.2 million in free cash flow, targeting 9%-10% EBITDA margins by fiscal 2027.
DLH reported fiscal third-quarter revenue of $44.2 million, with $38 million generated from technology-powered solutions following the transition of its Veterans Affairs CMOP program. The shift to a tech-focused business model supported profitability and debt reduction efforts.
Adjusted EBITDA reached $3.4 million, while free cash flow totaled $4.2 million. Debt declined to $128.7 million, and management expects further reductions starting in fiscal 2027. The company anticipates fourth-quarter revenue to remain consistent with Q3 levels.
DLH highlighted a clearer government procurement environment and an expanding contract pipeline, including a new Navy logistics IT contract. Growth priorities include contract expansions and smaller new-business wins.