EFOR

Everforth Inc

NYSE · INDUSTRIALS · SERVICES-HELP SUPPLY SERVICES

41.82

−1.77 −4.06%

USD · close Oct 26

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MKT CAP $1.7BP/E 21.6DIV YIELD —FCF YIELD 12.89%REV TTM $4B −1.0%NET INCOME $83M −40.8%NET DEBT $1.3B52W 17.06 – 53.28SEC XBRL · TTM TO Invalid Date

How EFOR rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

Text kept

37%

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Added

210

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Dropped

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Length

+830

words, now 17,606

New in FY2025

OVERVIEW ASGN provides IT solutions across the commercial and government sectors.
The Federal Government Segment provides advanced IT solutions in data and AI, cybersecurity, and enterprise transformation to some of the world's leading agencies in the public and private sectors.
Recognition of Goodwill and Acquired Intangible Assets — Determining the fair value of goodwill and intangible assets requires management's judgment, the use of significant estimates and assumptions and, in some cases, the utilization of independent valuation experts.
The most critical assumptions utilized in this determination are the future cash flow estimates associated with the acquired businesses, as well as discount rates and royalty rates applied to those cash flow estimates.
For the 2025 impairment test of goodwill and trademarks, the Company performed a qualitative assessment and determined there were no indicators of impairment and it was more likely than not that the fair value of its two reporting units, Commercial and Federal Government, and its trademarks, exceeded their respective carrying amounts.
RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2025 COMPARED WITH THE YEAR ENDED DECEMBER 31, 2024 In this section, we discuss the results of our operations for the year ended December 31, 2025 compared with the year ended December 31, 2024.
For a discussion of the year ended December 31, 2024 compared with the year ended December 31, 2023, please refer to Part II, Item 7.
Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024.
Revenues Revenues for the year were $4.0 billion, down 2.9 percent year-over-year.
The table below shows our revenues by segment (in millions). % of Total 2025 2024 Change 2025 2024 Change Commercial: Consulting $ 1,290.1 $ 1,128.2 14.4 % 32.4 % 27.5 % 4.9 % Assignment 1,500.1 1,740.5 (13.8) % 37.7 % 42.5 % (4.8) % 2,790.2 2,868.7 (2.7) % 70.1 % 70.0 % 0.1 % Federal Government 1,190.2 1,231.0 (3.3) % 29.9 % 30.0 % (0.1) % Consolidated $ 3,980.4 $ 4,099.7 (2.9) % 100.0 % 100.0 % Commercial Segment revenues (70.1 percent of total revenues) were down 2.7 percent year-over-year and are categorized into five industries: (i) Consumer and Industrial, (ii) Financial Services, (iii) Technology, Media and Telecom ("TMT"), (iv) Healthcare, and (v) Business Services.
The Consumer and Industrials industry was up low-teens and Healthcare was up low single digits, while the remaining three industries declined.
Federal Government Segment revenues (29.9 percent of total revenues) were down 3.3 percent year-over-year.
Federal Government Segment revenues are categorized into four customer types: (i) Defense and Intelligence, (ii) National Security, (iii) Civilian, and (iv) other clients.
Federal Civilian and Defense and Intelligence both declined year-over-year, while National Security was up.
Total IT consulting services revenues were $2.5 billion (62.3 percent of total revenues), up 5.1 percent year-over-year.
Commercial Segment consulting revenues were $1.3 billion, up 14.4 percent year-over-year.
Federal Government Segment revenues, which are all consulting revenues, were $1.2 billion, down 3.3 percent year-over-ye a r mainly related to the loss of certain contracts as a result of initiatives associated with DOGE.
Assignment revenues, which totaled $1.5 billion (37.7 percent of total revenues), were down 13.8 percent year-over-year, reflecting con tinued softness in the portions of the Commercial Segment Business that are more sensitive to changes in the macroeconomic cycles.
Gross Profit Gross Margin 2025 2024 Change 2025 2024 Change Commercial $ 914.4 $ 932.9 (2.0) % 32.8 % 32.5 % 0.3 % Federal Government 234.7 250.8 (6.4) % 19.7 % 20.4 % (0.7) % Consolidated $ 1,149.1 $ 1,183.7 (2.9) % 28.9 % 28.9 % — % Gross profit is comprised of revenues, less costs of services, which consist primarily of compensation for our billable professionals, other direct costs, and reimbursable out-of-pocket expenses.
Consolidated gross profit declined 2.9 percent consistent with the decline in revenues, resulting in a consistent gross margin of 28.9 percent in each year.
Gross margin for the Commercial Segment was up 30 basis points, reflecting a higher mix of consulting revenues.
Gross margin for the Federal Government Segment was down 70 basis points, primarily due to a higher volume of revenues from low-margin software licenses, the loss of certain higher margin contracts as a result of initiatives associated with DOGE, and higher rates of fringe benefits.
SG&A expenses were $854.0 million (21.5 percent of revenues), compared with $821.2 million (20.0 percent of revenues) in 2024.
SG&A expenses for the year ended December 31, 2025 included $26.5 million in acquisition, integration, and strategic planning expenses, inclusive of $5.2 million in charges related to strategic workforce optimization initiatives.
Additionally, in 2025, there was a $4.4 million write-off charge related to previously capitalized costs for software enhancements that will no longer be placed into service.
Amortization of Intangible Assets Amortization of intangible assets was $64.8 million, up from $58.1 million in 2024.
The increase relates to amortization of intangible assets associated with the acquisition of TopBloc (see Note 6.
Financial Statements and Supplementary Data ), partially offset by lower amortization from older intangible assets that are reaching, or have reached, the end of their useful lives.
Interest Expense, Net Interest expense, net, which consists primarily of cash-based interest expense, amortization and adjustments to deferred loan costs, and interest income, was $67.7 million, up from $64.3 million in 2024.
The increase was due to higher outstanding borrowings.
The weighted-average outstanding borrowings for 2025 and 2024 were $1.21 billion and 5.6 percent, and $1.05 billion and 6.0 percent, respectively.
Provision for Income Taxes The provision for income taxes was $49.1 million, down from $64.9 million in 2024 due to lower income before income taxes.
The effective tax rate of 30.2 percent was higher than the effective tax rate of 27.0 percent in 2024.
The increase in the effective income tax rate was primarily due to higher non-deductible executive compensation related to the termination of the Company’s deferred compensation plan (see Note 12.
Financial Statements and Supplementary Data ), and tax shortfalls related to stock-based compensation arrangements.
Net Income Net income was $113.5 million, down from $175.2 million in 2024.
Year Ended December 31, (Dollars in millions) 2025 2024 2023 Bookings $ 1,522.8 $ 1,281.3 $ 1,351.9 Book-to-Bill Ratio 1.2 to 1 1.1 to 1 1.2 to 1 Federal Government Segment Metrics Contract backlog for our Federal Government Segment represents the estimated amount of future revenues to be recognized under awarded contracts, including task orders and options, at a point in time ("Contract Backlog").
Year Ended December 31, (Dollars in millions) 2025 2024 2023 New Contract Awards $ 1,020.3 $ 1,340.5 $ 1,022.2 Book-to-Bill Ratio 0.9 to 1 1.1 to 1 0.8 to 1 December 31, (Dollars in millions) 2025 2024 2023 Funded Contract Backlog $ 492.9 $ 529.0 $ 543.5 Negotiated Unfunded Contract Backlog 2,455.6 2,589.6 2,466.0 Contract Backlog $ 2,948.5 $ 3,118.6 $ 3,009.5 Contract Backlog Coverage Ratio 2.5 to 1 2.5 to 1 2.4 to 1 Liquidity and Capital Resources Our working capital, which is current assets less current liabilities, at December 31, 2025 was $491.9 million, and our cash and cash equivalents were $161.2 million.
At December 31, 2025, we had approximately $455.0 million available under the $500.0 million revolving credit facility.
We believe that our cash and cash equivalents on hand, expected operating cash flows, and availability under our revolving credit facility will be sufficient to fulfill our obligations, working capital requirements, capital expenditures, and anticipated acquisitions (see Note 17.

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Gone since FY2024

OVERVIEW ASGN provides information technology ("IT") services and solutions across the commercial and government sectors.
The Federal Government Segment provides advanced IT solutions to the Department of Defense, the intelligence community, and key federal civilian agencies, namely the Department of Homeland Security.
For the 2024 impairment test of goodwill and trademarks, the Company performed a qualitative assessment and determined there were no indicators of impairment and it was more likely than not that the fair value of each of the reporting units, and the trademarks, exceeded their respective carrying amounts.
For the 2024 goodwill impairment test, the Company had three reporting units: Apex, Creative Circle and Federal Government.
Following the impairment test, the Company aggregated the Apex and Creative Circle reporting units into a single reporting unit, now known as the Commercial reporting unit.
Before and after this change it is more likely than not the fair value of the Company's reporting units exceeded their carrying value.
RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2024 COMPARED WITH THE YEAR ENDED DECEMBER 31, 2023 In this section, we discuss the results of our operations for the year ended December 31, 2024 compared with the year ended December 31, 2023.
For a discussion of the year ended December 31, 2023 compared with the year ended December 31, 2022, please refer to Part II, Item 7.
Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.
Revenues Revenues for the year were $4.1 billion, down 7.9 percent year-over-year.
The table below shows our revenues by segment (in millions). % of Total 2024 2023 Change 2024 2023 Change Commercial: Assignment $ 1,740.5 $ 2,078.9 (16.3) % 42.5 % 46.7 % (4.2) % Consulting 1,128.2 1,095.5 3.0 % 27.5 % 24.6 % 2.9 % 2,868.7 3,174.4 (9.6) % 70.0 % 71.3 % (1.3) % Federal Government 1,231.0 1,276.2 (3.5) % 30.0 % 28.7 % 1.3 % Consolidated $ 4,099.7 $ 4,450.6 (7.9) % 100.0 % 100.0 % From an industry perspective, the Company operates in six broad industry verticals.
Commercial Segment revenues (70.0 percent of total revenues) were down 9.6 percent year-over-year and are categorized into five broad industry verticals: (i) Financial Services, (ii) Consumer and Industrials, (iii) Healthcare, (iv) Technology, Media and Telecom ("TMT"), and (v) Business and Government Services.
The TMT industry vertical had low single-digit growth, while the remaining four industry verticals declined year-over-year.
Federal Government Segment revenues (30.0 percent of total revenues), the sixth industry vertical, were down 3.5 percent year-over-year, reflecting lower third-party software licenses revenues compared with the prior year.
Total IT consulting services revenues were $2.4 billion (57.5 percent of total revenues), down 0.5 percent year-over-year.
Federal Government Segment revenues, which are all consulting revenues, were $1.2 billion, down 3.5 percent year-over-year as stated above.
Commercial Segment consulting revenues were $1.1 billion, up 3.0 percent year-over-year.
Assignment revenues, which totaled $1.7 billion (42.5 percent of total revenues), were down 16.3 percent year-over-year, reflecting continued softness in the portions of the Commercial Segment Business that are more sensitive to changes in the macroeconomic cycles (i.e., more cyclical).
Gross Profit Gross Margin 2024 2023 Change 2024 2023 Change Commercial $ 932.9 $ 1,017.6 (8.3) % 32.5 % 32.1 % 0.4 % Federal Government 250.8 262.4 (4.4) % 20.4 % 20.6 % (0.2) % Consolidated $ 1,183.7 $ 1,280.0 (7.5) % 28.9 % 28.8 % 0.1 % Gross profit is comprised of revenues less costs of services, which consist primarily of compensation for our contract professionals, other direct costs, and reimbursable out-of-pocket expenses.
Consolidated gross profit declined 7.5 percent on a revenue decline of 7.9 percent.
Gross margin was 28.9 percent, an expansion of 10 basis points year-over-year, reflecting a higher mix of Commercial consulting revenues (which carry a higher gross margin than assignment revenues and Federal Government Segment revenues), as well as margin expansion in these revenues.
SG&A expenses were $821.2 million (20.0 percent of revenues), compared with $844.2 million (19.0 percent of revenues) in 2023.
The decrease in SG&A expenses was primarily due to lower compensation-related expense.
Amortization of Intangible Assets Amortization of intangible assets was $58.1 million, down from $71.7 million in 2023.
This decrease was due to (i) the accelerated amortization method whereby most of our acquired intangibles have higher amortization rates at the beginning of their useful lives, and (ii) older intangibles reaching the end of their useful lives.
Interest Expense, Net Interest expense, net, which consists primarily of cash-based interest expense, amortization and adjustments to deferred loan costs, and interest income, was $64.3 million, down from $66.4 million in 2023.
The decrease was primarily the result of higher interest income and lower debt amendment fees (related to refinancing the senior secured credit facility in both periods), partially offset by higher interest expense on the senior secured credit facility.
The weighted-average outstanding borrowings for 2024 and 2023 were $1.05 billion and the cash-based interest expense rate was 6.0 percent and 5.9 percent (excluding interest income and costs related to debt amendments), respectively.
Provision for Income Taxes The provision for income taxes was $64.9 million, down from $78.4 million in 2023 due to lower income before income taxes.
The effective tax rate of 27.0 percent was slightly higher than the effective tax rate of 26.3 percent in 2023.
Net Income Net income was $175.2 million, down from $219.3 million in 2023.
The average duration of commercial consulting projects is approximately one year.
Year Ended December 31, (Dollars in millions) 2024 2023 2022 Bookings $ 1,281.3 $ 1,351.9 $ 1,192.2 Book-to-Bill Ratio 1.1 to 1 1.2 to 1 1.2 to 1 Federal Government Segment Metrics Contract backlog for our Federal Government Segment represents the estimated amount of future revenues to be recognized under awarded contracts, including task orders and options, at a point in time ("Contract Backlog").
Year Ended December 31, (Dollars in millions) 2024 2023 2022 New Contract Awards $ 1,340.5 $ 1,022.2 $ 1,073.3 Book-to-Bill Ratio 1.1 to 1 0.8 to 1 0.9 to 1 December 31, (Dollars in millions) 2024 2023 2022 Funded Contract Backlog $ 529.0 $ 543.5 $ 582.3 Negotiated Unfunded Contract Backlog 2,589.6 2,466.0 2,681.2 Contract Backlog $ 3,118.6 $ 3,009.5 $ 3,263.5 Contract Backlog Coverage Ratio 2.5 to 1 2.4 to 1 2.9 to 1 Liquidity and Capital Resources Our working capital, which is current assets less current liabilities, at December 31, 2024 was $550.6 million, and our cash and cash equivalents were $205.2 million.
At December 31, 2024, we had full availability under the $500.0 million revolving credit facility.
We believe that our cash and cash equivalents on hand, expected operating cash flows, and availability under our revolving credit facility will be sufficient to fulfill our obligations, working capital requirements, and capital expenditures for the next 12 months.
Net cash provided by operating activities was $400.0 million in 2024, compared with $456.9 million in 2023.
Net cash provided by operating activities before changes in operating assets and liabilities was $353.9 million, compared with $400.8 million in 2023.
Net cash provided by changes in operating assets and liabilities was $46.1 million, compared with $56.1 million in 2023.
Net cash used in investing activities was $35.3 million and $40.5 million for 2024 and 2023 , respectively , and primarily related to capital expenditures.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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