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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarter Ended March 31, 2005

Commission File Number 0-8401

CACI International Inc

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of

incorporation or organization)

54-1345888

(I.R.S. Employer Identification No.)

1100 North Glebe Road, Arlington, VA 22201

(Address of principal executive offices)

(703) 841-7800

(Registrant’s telephone number,

including area code)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

CACI International Inc Common Stock, $0.10 par value

(Title of each class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x    No  ¨.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of May 9, 2005: CACI International Inc Common Stock, $0.10 par value, 29,940,690 shares.

CACI INTERNATIONAL INC AND SUBSIDIARIES

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PART 1

FINANCIAL INFORMATION

CACI INTERNATIONAL INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(amounts in thousands, except per share data)

See notes to condensed consolidated financial statements (unaudited).

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CACI INTERNATIONAL INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(amounts in thousands, except per share data)

See notes to condensed consolidated financial statements (unaudited).

4

CACI INTERNATIONAL INC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(amounts in thousands, except per share data)

See notes to condensed consolidated financial statements (unaudited).

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CACI INTERNATIONAL INC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(amounts in thousands)

See notes to condensed consolidated financial statements (unaudited).

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CACI INTERNATIONAL INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(amounts in thousands)

See notes to condensed consolidated financial statements (unaudited).

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CACI INTERNATIONAL INC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in the annual financial statements, prepared in accordance with generally accepted accounting principles, have been condensed or omitted pursuant to those rules and regulations; although the Company believes that the disclosures made are adequate to make the information presented not misleading.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all necessary adjustments and reclassifications (all of which are of a normal, recurring nature), that are necessary for fair presentation for the periods presented. It is suggested that these unaudited condensed consolidated financial statements be read in conjunction with the audited condensed consolidated financial statements and the notes thereto included in the Company’s latest annual report to the Securities and Exchange Commission on Form 10-K for the year ended June 30, 2004. The results of operations for the three and nine months ended March 31, 2005, are not necessarily indicative of the results to be expected for any subsequent period, or for the full fiscal year.

Certain reclassifications have been made to the prior period’s financial statements to conform to the current presentation.

The Company considers all investments with an original maturity of three months or less to be cash equivalents. The Company classifies investments with a maturity of more than three months but less than twelve months as short-term marketable securities. To date, marketable securities have been classified as available-for-sale and have been carried at fair value with any unrealized gains and losses reported as a separate component of comprehensive income. The fair value of marketable securities was determined based on quoted market prices for those instruments at the reporting date. The cost of securities sold is based on specific identification. Premiums and discounts are amortized over the period from acquisition to maturity and are included in investment income, along with interest and dividends.

During the year ended June 30, 2004 and the nine-month period ended March 31, 2005, there were no realized or unrealized gains or losses. The Company’s cash and equivalents and short-term marketable securities at March 31, 2005 and June 30, 2004, consisted of the following (cost approximated fair value):

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Accounts receivable are reported net of allowances for doubtful accounts of approximately $4.9 million at both March 31, 2005 and June 30, 2004. Accounts receivable consist of the following:

The gross carrying amounts and accumulated amortization of the Company’s intangible assets as of March 31, 2005 and June 30, 2004, were as follows:

Intangible assets are being amortized over periods ranging from 12 to 120 months based on their estimated useful lives. The intangible assets acquired with the May 2004 purchase of the Defense and Intelligence Group (D&IG), of American Management Systems, Inc. (AMS) (note L), as well as those acquired with other recent acquisitions, are being amortized using an accelerated method based upon the estimated cash flows expected to be derived from customer relationships. Amortization expense was $4.9 million and $14.6 million for the three and nine months ended March 31, 2005, respectively, and $8.2 million for the year ended June 30, 2004. Expected amortization expense through June 30, 2009, is as follows:

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Accrued compensation and benefits consist of the following:

Other accrued expenses consist of the following:

In order to fund the acquisition of D&IG, the Company executed a $550 million credit facility, which included a revolving credit facility of $200 million and an institutional term loan of $350 million. Total initial borrowings under the credit facility were $422.6 million, of which $346.5 million was outstanding at March 31, 2005. The five-year secured revolving credit facility permits continuously renewable borrowings of up to $200 million with annual limits on amounts that may be borrowed for acquisitions. The Company had no outstanding balance on the revolving credit facility as of March 31, 2005.

The revolving credit facility permits one, two three and six month interest rate options. The Company pays a fee on the unused portion of the facility. The institutional term loan is a seven-year secured facility in the amount of $350 million. The Company had $346.5 million outstanding on the term loan as of March 31, 2005. One percent of the principal is required to be prepaid in each of years one through six of the term with the remainder due on the maturity date. The revolving credit facility and institutional term loan are secured by substantially all of the Company’s assets.

Interest rates on both the revolver and the term loan are based on LIBOR or the higher of the prime rate or Federal funds rate, plus applicable margins. As of March 31, 2005, the weighted average interest rate on the loans outstanding under the credit facilities was approximately 5.0%. Interest expense for the three and nine months ended March 31, 2005, was $3.8 million and $11.0 million, respectively. Margin and unused fee rates are determined quarterly based on the leverage ratio.

The total costs associated with securing the new credit facility were approximately $8.2 million, which are being amortized as additional interest expense over the life of the revolving credit facility and institutional term loan. The unamortized balance of approximately $7.0 million as of March 31, 2005, is included with other assets in the accompanying consolidated balance sheet.

The Company is required to operate within certain limits on leverage, net worth and fixed-charge coverage ratios and as of March 31, 2005, was in compliance with these covenants. Effective May 3, 2005, however, the Company was non-compliant with a separate covenant that required it to have entered an interest rate hedge agreement covering a portion of its outstanding term loan balance by this date. Under the terms of the credit facility, the Company has 30 days to comply with this covenant. The Company is in the process of securing a hedge agreement for the required portion of its term loan, and expects the agreement to be finalized by May 31, 2005.

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The components of notes payable are as follows:

The Company is involved in various lawsuits, claims, and administrative proceedings arising in the normal course of business. Management is of the opinion that any liability or loss associated with such matters, either individually or in the aggregate, will not have a material adverse effect on the Company’s operations and liquidity.

The Company has entered into a subcontract agreement with a vendor to purchase a number of directional finding units to be ordered in connection with the performance of one of the Company’s contracts over a four year period ending in fiscal year 2006. The subject subcontract provides for unit price decreases as the number of units purchased under the subcontract increases. Based on the present status of contract performance, management believes that the Company will purchase a sufficient number of units over the subcontract term to allow it to realize the lowest unit cost available. Based upon that expectation, unit costs incurred to date have been recognized in other direct costs in the accompanying consolidated income statements, at such lowest unit cost. Based on the number of units ordered to date and assuming that no other units are ordered under the subcontract, the Company’s maximum unit price exposure (the difference between the unit price that would be applicable to the number of units actually purchased as compared to the discount price at which the Company has recognized the purchases to date), is estimated to be approximately $1.7 million, which has not been recorded in the Company’s financial statements as of March 31, 2005.

The Company is currently under examination by the tax authorities of the State of Indiana. The examination is for the period beginning June 30, 1991 and ending June 30, 2000 and focuses on whether the Company established a taxable presence in Indiana during the examination period. Management of the Company believes that it did not establish a taxable presence and is contesting the State’s conclusion vigorously. Management has accrued its best estimate of the exposure for this matter. The Company does not believe the outcome will have a material adverse effect on its financial statements.

On April 26, 2004, the Company received information indicating that one of its employees was identified in a report authored by U.S. Army Major General Antonio M. Taguba as being connected to allegations of abuse of Iraqi detainees at the Abu Ghraib prison facility. To date, despite the Taguba Report and the subsequently-issued Fay Report addressing alleged inappropriate conduct at Abu Ghraib, no present or former employee of the Company has been officially charged with any offense in connection with the Abu Ghraib allegations. The Company does not believe the outcome of this matter will have a material adverse effect on its financial statements.

In April 2005, the Federal District Court for the Eastern District of Virginia entered a final judgment based on the October 2004 decision in an arbitration proceeding to which the Company was party. That judgment awards the Company approximately $11.3 million in damages, costs and fees, as well as a two year injunction against the defendant’s competing with the Company, and a one year injunction against his soliciting Company employees. The Company is now engaged in efforts to collect that judgment and will recognize the judgment only as payments are received.

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The Company currently accounts for employee stock-based compensation transactions using the intrinsic value method in accordance with Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees (APB No. 25), as amended by Financial Accounting Standards Board (FASB) Interpretation No. 44, Accounting for Certain Transactions Involving Stock Compensation. For the three and nine months ended March 31, 2005, the Company recognized, under APB No. 25, net after-tax compensation expense of approximately $273,000 and $1,173,000 relating to incentive grants of restricted stock units. No such compensation cost was recognized in connection with these transactions in the three and nine months ended March 31, 2004, as no incentive restricted stock grants had been granted. If the Company’s employee stock-based compensation transactions had been accounted for based on their fair value, as determined under Statement of Financial Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation, the pro forma earnings would have been as follows:

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The weighted average fair value of options granted during the nine months ended March 31, 2005 and 2004 was $16.12 and $11.89, respectively. The fair value of each option granted is estimated on the grant date using the Black-Scholes option pricing model. These pro forma results may not be indicative of future results for the full fiscal year due to the potential grants vesting and other factors. The following significant assumptions were made in estimating fair value:

The Company adopted the 2002 Employee Stock Purchase Plan (ESPP), Management Stock Purchase Plan (MSPP), and Director Stock Purchase Plan (DSPP) at its annual shareholder meeting on November 21, 2002 and implemented these plans beginning July 1, 2003. There are 500,000, 300,000, and 75,000 shares authorized for grants under the ESPP, MSPP and DSPP, respectively. The aforementioned plans provide employees, management, and directors with an opportunity to acquire or increase ownership interest in the Company through the purchase of shares of the Company’s common stock, subject to certain terms and conditions. The provisions of the American Jobs Creation Act of 2004 may require that one or more of these plans be amended before the end of calendar year 2005.

The ESPP allows eligible full-time employees to purchase shares of common stock at 85% of the lower of the fair market value of a share of common stock on the first or last day of the quarter. Eligible employees are provided the opportunity to acquire Company common stock once each quarter. The maximum number of shares that an eligible employee may purchase during any quarter is equal to two times an amount determined as follows: 20% of such employee’s compensation over the quarter, divided by 85% of the fair market value of a share of common stock, on the first day of the offering period.

The ESPP is a qualified plan under Section 423 of the Internal Revenue Code, and the Company follows APB Opinion No. 25 for financial reporting purposes, and the provisions of SFAS No. 123 for disclosure purposes. Accordingly, no compensation expense has been recorded for shares acquired under the ESPP.

As of March 31, 2005, participants have purchased approximately 182,000 shares under the ESPP, at a weighted average price per share of $36.69. Of these shares, approximately 36,000 were purchased at $46.29 per share during the three months ended March 31, 2005, and approximately 113,000 were purchased at a weighted average price per share of $38.02 during the nine months ended March 31, 2005.

The MSPP provides those senior executives with stock holding requirements a mechanism to receive Restricted Stock Units (“RSUs”) in lieu of up to 30% of their annual bonus. The RSUs are awarded under the MSPP at 85% of the market price of the Company’s common stock on the date of the award and vest at the earlier of 1) three years from the grant date, 2) upon a change of control of the Company, 3) upon a participant’s retirement at or after age 65, or 4) upon a participant’s death or permanent disability. Vested RSUs will be settled in shares of common stock or cash payment, as elected by the participant.

The Company accounts for MSPP transactions in accordance with APB No. 25. As of March 31, 2005, there are approximately 54,300 RSUs outstanding under the MSPP at a weighted average price per share of $31.46. During the fiscal year ended June 30, 2004, the Company issued approximately 36,200 RSUs at a weighted average price per share of $28.99 per share, of which approximately 8,600 have been forfeited due to employee terminations and resignations. During the nine months ended March 31, 2005, the Company issued approximately 34,500 RSUs at a weighted average price per share of $34.00 per share, of which approximately 7,800 have been forfeited due to employee terminations and resignations.

The DSPP allows directors to elect to receive RSUs at the market price of the Company’s common stock on the date of the award in lieu of up to 50% of their annual retainer fees. Vested RSUs will be settled in shares of common stock. As of June 30 2004, approximately 2,000 RSUs had been issued under the DSPP at a weighted average price per share of $42.87, and approximately 600 RSUs were issued under the DSPP at a weighted average price per share of $52.08 during the nine months ended March 31, 2005.

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Basic and diluted earnings per share for the three and nine-month periods ended March 31, 2005 and 2004, respectively, were as follows:

Basic earnings per share is computed by dividing income by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Diluted earnings per share includes the incremental effect of stock options and RSUs calculated using the treasury stock method.

On May 1, 2004, the Company completed the purchase of the D&IG and related assets of AMS. The D&IG provides the U.S. Government defense, intelligence and homeland security agencies with business management solutions, including information technology and software design, in support of acquisition, financial management, logistics, warfighting and intelligence missions. The transaction was entered into with CGI Group Inc., which concurrently purchased all of the outstanding shares of AMS.

The D&IG acquisition has been accounted for under the purchase method of accounting pursuant to Statement of Financial Accounting Standards (SFAS) No. 141, Business Combinations. Accordingly, the identifiable intangible assets acquired and liabilities assumed were recognized at their fair value as of the date of the acquisition. During the nine months ended March 31, 2005, the Company made certain adjustments to the allocation of the D&IG purchase price, and may make further adjustments to the purchase price allocation as additional information becomes available, including an adjustment to recognize the payment of up to $10 million the Company may be required to make based on the final determination of the accounting treatment for certain contract costs. CGI Group Inc. and the Company plan to submit this matter to an arbitrator for resolution. The Company does not expect a final decision prior to its fiscal year end of June 30, 2005. Any additional amounts paid will be recorded as goodwill.

In August 2004, the Company acquired all of the outstanding capital stock in IMAJ Consulting, Ltd (IMAJ), a company in the United Kingdom, for approximately $3.7 million. IMAJ has broad expertise in classical statistics and advanced intelligent systems methods enabling appropriate techniques, or combination of techniques, to be selected for analytical projects.

Adjustments made to the purchase price allocations of the D&IG acquisition and other fiscal year 2004 acquisitions, the acquisition of IMAJ, and a $4.0 million earn-out payment related to the Company’s May 2003 acquisition of Premier Technology Group, Inc., resulted in a net increase to goodwill of approximately $6.1 million during the nine-months ended March 31, 2005.

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The Company reports operating results and financial data for two reporting segments: domestic operations and international operations. Domestic operations provide information technology and communications solutions through all four of the Company’s major service offerings: systems integration, managed network services, knowledge management and engineering services. Its customers are primarily U.S. federal agencies. Other customers include foreign government agencies, commercial businesses and state and local government agencies. International operations offer services to both commercial and government customers primarily through the Company’s systems integration line of business. The Company evaluates the performance of its operating segments based on income before income taxes. Summarized financial information for the Company’s reportable segments is shown in the following table.

In December 2004, the FASB issued SFAS No. 123-R, Shared-Based Payments, (FAS 123-R), which will require that companies recognize all forms of stock-based compensation as an expense in the statement of operations. Compensation cost to be recognized will be based on the estimated fair values of the equity instruments that are issued, and will be measured upon the date of grant. Compensation cost will be recognized over the vesting period during which an employee provides services in exchange for the grant award.

The Company will adopt the provisions of FAS 123-R for fiscal year 2006, beginning July 1, 2005 and the effect of adopting this new standard will be to reduce Company earnings by a pro-rated amount of the fair values assigned to equity instruments granted to employees. The Company is currently preparing its analysis of FAS 123-R and the impact of its provisions. The pro-forma effect of recognizing stock-based compensation expense on historical earnings is provided in Note I.

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Results of Operations For the Three Months Ended March 31, 2005 and 2004.

Revenue. The table below sets forth revenue by customer operating segment with related percentages of total revenue for the three months ended March 31, 2005 and 2004, during fiscal year 2005 (FY 2005) and 2004 (FY 2004) respectively:

For the three months ended March 31, 2005, total revenue increased by 43.9%, or $126.5 million, over the same period a year ago. The majority of the increase in revenue in the quarter resulted primarily from revenues of acquired businesses and in particular, from revenue of the Defense and Intelligence Group (D&IG) of American Management Systems, Inc. (AMS), acquired in May 2004. Revenue generated from the date that a business is acquired through the first anniversary of the acquisition date is considered acquired revenue. Recent acquisitions accounted for approximately $84.2 million of the revenue growth during the quarter as follows:

The increase also results from organic revenue growth in the quarter of 14.7%. This growth is the result of the Company’s strategic focus and concentration on national security and intelligence, the global war against terrorism, and the reshaping of the way government agencies communicate, use and disseminate information, and deliver services to the citizens. These areas continue to be of high national priority and are expected to receive strong funding support going forward.

Department of Defense (DoD) revenue increased 54.3%, or $106.1 million, for the three months ended March 31, 2005 as compared to the same period a year ago. DoD revenue increased primarily as a result of the May 1, 2004 acquisition of D&IG and the continuing demand from customers such as the military intelligence community, the U.S. Army’s Communications-Electronics Command, the Defense Information Systems and the U.S. Navy. D&IG accounted for $58.3 million of the acquired DOD revenue, and the aforementioned acquisitions together contributed $64.4 million of the increased DoD revenue in the quarter.

Revenue from Federal Civilian Agencies increased 21.9%, or $16.2 million, for the quarter ended March 31, 2005. The increase was comprised of $17.7 million of revenues contributed by the aforementioned acquisitions, offset by a $1.5 million decrease in revenues earned from contracts the Company was servicing throughout fiscal year 2004. This decrease results primarily from reduced Department of Justice (DoJ) revenues. Approximately 26.3% of the Federal Civilian Agency revenue was derived from the DoJ, for whom the Company provides litigation support services and maintains an automated debt collection system. Revenue for DoJ was $23.8 million for the third quarter of FY2005 as compared to $26.0 million for the same period a year ago. This decrease in revenue is the result of a decrease in fixed unit price work and reduced work on an FBI-related contract.

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Commercial revenue is derived from both international and domestic operations. International operations accounted for $14.3 million, or 84.5%, of the total Commercial revenue, while the domestic operations accounted for $2.6 million, or 15.5%. Total commercial revenue increased by 14.8%, or $2.2 million, during the third quarter of FY2005, as compared to the same period a year ago. The majority of this growth came from the Company’s international operations, where sales of software and data products were higher than a year earlier and where it’s commercial IT services business showed a marked improvement. Overall, the Company’s international operations grew by over 12.0% from the year earlier quarter. The balance of the growth in Commercial revenue resulted largely from D&IG customers.

Revenue from state and local governments increased by 48.4%, or $2.0 million for the quarter ended March 31, 2005. This increase is attributable to recent acquisitions and new contracts awarded during the year.

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Income from Operations. The following table sets forth the relative percentage that certain items of expense and earnings bore to revenue for the quarters ended March 31, 2005 and 2004, respectively.