Good morning. Thank you for standing by. And welcome to Booz Allen Hamilton’s Earnings Call covering First Quarter Results for Fiscal 2015. At this time, all lines are in a listen-only mode. Later, there will be an opportunity for questions. I’d now like to turn the call over to Mr. Curt Riggle.

Thank you, Shannon. And thank you for joining us today for Booz Allen’s first quarter fiscal 2015 earnings announcement. We’ve provided presentation slides on our website and are now on Slide 1. I’m Curt Riggle, Director of Investor Relations, and with me to talk about our business and financial results this morning are Ralph Shrader, our Chairman and Chief Executive Officer; Horacio Rozanski, our President and Chief Operating Officer; and Kevin Cook, Senior Vice President and Chief Financial Officer. We hope you’ve had an opportunity to read the press release for our first quarter earnings that we issued earlier this morning. As shown on this disclaimer on Slide 2, please keep in mind that some of the items we will discuss this morning will include statements that maybe considered forward-looking, and therefore are subject to known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecasted results. Those risks and uncertainties include, among other things, general economic conditions, the availability of government funding for our company’s services and other factors discussed in today’s earnings release and set forth under the forward-looking statements disclaimer included in our first quarter fiscal 2015 earnings release and in our SEC filings. We caution you not to place undue reliance on any forward-looking statements that we may make today, and remind you that we assume no obligation to update or revise the information discussed on this call. During today’s call, we will also discuss some non-GAAP financial measures and other metrics which we believe provide useful information for investors. We include an explanation of adjustments and other reconciliations of our non-GAAP measures to the most comparable GAAP measures in our first quarter fiscal 2015 slides. It is now my pleasure to turn the call over to our CEO, Ralph Shrader, and he will start on Slide 3.

Thank you, Curt. Good morning. And thank you all for joining us on this mid-summer day. It was just two months ago that we reported year end results for our fiscal 2014, and a lot has happened in that time. This is a summer of transitions for us at Booz Allen, and I’m proud to say they are transitions by choice with leading roles being passed to well prepared, long tenured and able successor. That severity in the business world today, and I think it speaks well to Booz Allen’s strong culture. We bid farewell to our Chief Financial and Administrative Officer Sam Strickland at the end of June. Sam served our firm and our investors superbly for many years, and we welcome Kevin Cook, who Sam mentored closely, and many of you know well as our CFO on July 1. Two weeks ago, I announced my own transition. The Board accepted my request to retire as Chief Executive Officer at the end of the calendar year, and selected Horacio Rozanski to lead the firm effective January 1, 2015. The Board asked me to continue to serve in the role of Chairman, and I will be honored to do so. Horacio is also well known to many of you. I’ve known Horacio for 20 years, and have the highest regard to his values, intellect, accomplishments, the dedication to the firm. I wholeheartedly endorse him as my successor. Horacio in my view is the complete package. He’s a strategist and visionary of values-based leader and a proven performer on both the client side and in internal leadership roles. He and I share much in the way of philosophy and world view, and will work together very closely to ensure a seamless transition at the top. I’ll turn the microphone over to…

Thank you, Ralph. Those three words indicate much more than a speaker transition. I can’t express deeply enough my thanks and our collective gratitude to Ralph for his leadership, his example and his mentorship. From my part, I’m tremendously honored by the Board’s Vote of Confidence in electing me CEO, and have been greatly touched by the messages from our staff. I want to assure our people and our clients, and you, our investors of my commitment to all of you and to Booz Allen’s success in its second century. We’re now on Slide 4. In Booz Allen’s first 100 years, we’ve had seven leaders at the top. Ralph Shrader has served in Booz Allen’s top job for 15 years, through a period of dramatic change and growth. He’s truly a legend in our industry for his strong stable leadership, for values, visualpride and love for the firm, and his commitment to the community beyond office walls. Ralph and I will continue to work closely to ensure a seamless transition, and I am delighted that he will remain Chairman of the Board, as I trust you as investors as well. You may remember that he was back in earnings call in October 2012, that Ralph and I first discussed Booz Allen’s long-term strategy that we call Vision 2020. We chose that name, because 2020 seemed a useful guidepost for evolving our firm to best serve clients, attract talented staff and deliver returns to investors over the long term. But in some ways, Vision 2020 is a misnomer, because it could be mistaken for something far off when in fact the impact of our strategy is beginning to be felt in our business already. We are now in Phase 3 of Vision 2020, which has three main trusts. First, continued focus…

Thank you, Horacio. Before diving into the numbers, I want to thank both you and Ralph for the confidence you’ve shown in me. I’ve known you both for many years and Horacio, I look forward to working with you and to seeing Booz Allen flourish for many years to come. So, for those on the call today, good morning, and thank you for joining us. As our first quarter of fiscal year 2015 comes to a close, I’m pleased to say that we’re on track to the path we laid out for a full year performance, and like Ralph, I have a sense of cautious optimism about government contracting climate we’re experiencing this summer. We did as expected, see continued revenue declines in the first quarter, and that reflected the lingering challenges in the market as agencies began to emerge from the effects of the continuing resolution that was lifted in January of 2014. Our bottom line, however, remains stable positively impacted by a variety of factors I’ll detail in a moment. As we mentioned to you on our May call, in the early days of this quarter, we’ve begun to see an uptick in proposal activity over the prior year. I’m pleased to report that this trend has continued into the summer. In fact, the proposal pace in the first quarter is among several signs of a more encouraging federal procurement climate. Our order activity reflects the greater budget clarity that exists today. Our funded backlog increased 7.1% to $2.35 billion and our book-to-bill ratio for the first quarter is 0.88, improved over the 0.52 that we show in the first quarter of our last fiscal year. Proposal of award activity in July is also showing continued strength as the government approach its fiscal year end on September 30.…

Thank you, Kevin. Horacio and Ralph. Shannon, at this point, can you provide instructions for the question-and-answer portion of the call?

Thank you. [Operator Instructions] Our first question is from Bill Loomis of Stifel. You may begin. Bill Loomis – Stifel Nicolaus: Hi. Thank you, good morning everyone.

Good morning, Bill. Bill Loomis – Stifel Nicolaus: Looking at the awards, I think it was higher than we expected at this point. Do you – you said the pace is continuing in July. I mean, its sounds like you have good momentum going in the September, because that’s usually like the month of September before we see strong awards. What could derail that? Your partners or anybody seeing anything that could slow that momentum down?

Hey, Bill. It’s Kevin. Bill Loomis – Stifel Nicolaus: Hi.

I've been sitting through a number of project management reviews if you will with our senior partners, talking about the different accounts of the business, the Army, the Navy, the Air force, Intel et cetera et cetera. And I see a lot of optimism coming out of those meetings, there is a lot of talk of Congress departing at the end of this week, not coming back till September, and only having 10 days in September, but the agencies themselves, I think are focused on awarding contracts, and maybe even more importantly, funding those contracts. So I can’t say there’s nothing out there, but I don't think, it's probable that anything would derail the momentum at this point. Bill Loomis – Stifel Nicolaus: And then just a follow-on on your awards, can you give us a sense of how much was new awards versus re-compete or existing business extended? And then, related to that on kind of your proposal set, I did see, you have outstanding, how much of that might be new to Booz Allen versus re-ones or re-competes? Thanks.

Sure. I’d say a significant amount of the work that we've won in the first quarter is new. We have won and we continue to do a large degree of our re-competes as we’ve published in the Form 10-K every year, but for example, we were one of the few contractors on the OASIS contracts to be awarded spots in all seven areas. We’re able to bid, work out of all seven areas. We won a spot on the EAGLE-2 contract for Booz Allen Engineering Services account. We've won three Mac contracts, defense systems, homeland defense, and joined forces. We've also won a new Intel contract, I can't talk too much about, and we won two re-competes of Intel contracts, only one of which has been the funding recognized in our backlog at this point. So, we continue to win our re-competes, but we do have some good news in the new work arena as well. Bill Loomis – Stifel Nicolaus: Okay. Great, thank you.

Thank you. Our next is from Carter Copeland of Barclays. You may begin. Carter Copeland – Barclays Capital: Hey, good morning, gentlemen. And congratulations, Ralph, on your retirement, and Horacio and Kevin on your appointments.

Thank you.

Thanks, Carter. Carter Copeland – Barclays Capital: Just a couple of quick questions. First on the operating margin front, I'm just going back to Sam's comments on the call last quarter about the expectation for not kind of reaching the high watermark you saw last Q1. Is that completely related to the provision that you outlined and sized, Kevin, or was there any difference in what you were planning on from an indirect standpoint in the quarter?

Certainly, part of it was related to the provision, but the majority of it was just solid operating metrics. Our utilization of our staff has remained high. One of the good news stories is, a lot of them didn’t propose a work we’ve been done has not been done by people being pulled off of billable work. It's been people shifting off of adman time they do billable work and that’s a huge plus for us. So now the bulk of the operating margin was solid operations. We did say on the last call that the highs would be lower and lows would be higher. And I think we still believe that. We are seeing a more even flow of our investment spend this year, but we just had I think a more solid operating first quarter than we had anticipated. We will see a lot of additional market and then proposal in the second quarter, and we are hoping that drives a significant increase in backlog which will then set the back half of the year of course and actually in the fiscal year 2016 as well. Carter Copeland – Barclays Capital: Okay. So as a follow-up I guess on a related note from a mix standpoint, it looks like you’ve shifted up over the last couple of quarters to more, a slightly higher percentage of fix price in the mix and that’s kind of stuck over the last two, three quarters. Is that a more permanent shift at the expense of T&M or is this just noise in the kind of regular band of how the work shapes out.

Hey, Carter, this is Curt. The shift really was a conversion of a contract in Booz Allen Engineering Services. And what we said I think with the quarter before last when we started seeing that, the opportunity that we see through that shift is better than the cost reversible contract that used to be, but it does not as high as the rest of the portfolio in our fixed price environment. So I think it’s a stable number, but it is the uptick is not as pronounced in terms of margin as the rest of the portfolio. Carter Copeland – Barclays Capital: Okay, great. Thank you very much gentlemen.

Thank you. Our next question is from Joe Nadol of JPMorgan. You may begin. Joseph Nadol III – JPMorgan: Thanks. Good morning and also congrats to all of you. My first question is just on the bookings environment. When I look back over the last couple of years when things have gotten tougher, Q2 has almost always been a good quarter for you and that of course historically that’s just the seasonality of the business. But it seems like that the tougher periods have been the other quarters, particularly government fiscal quarters one and two or your three and four. Could you maybe tell me if you agree and if you could think that this is really different what you’re seeing now versus the normal very strong seasonality that you always get?

Joe, its Kevin. I would say especially if you go back to last year, we had a book-to-bill basically of zero in the third quarter and that was a direct result of the government shutdown and the procurement shop is really not ramping back up till after the January 1. As you know, we take a very conservative approach to backlog, we do not put anything into our backlog unless we actually have a signed task order. So from these large ID/IQs we make no estimation of work to be won, we wait we wait for the signed task orders, so I think that led to the book-to-bill and the low book-to-bill in Q3. Q4, generally we see a little bit higher book-to-bill than our Q4 versus the Q3 that I just talked about. And I think that held true this past year. So this is, I would say more like the old days where we saw more of an uptick in our Q1 than we have in the last couple of years, and we would expect significant bookings in Q2, and then a pull back a bit in Q1 not only because so much gets pushed out in the government, end of government fiscal year, but then you have a lot of holidays an vacation time, not only on the contractor side, but predominantly on the government side in the procurement offices, and what would be their first quarter. Joseph Nadol III – JPMorgan: Okay. Thank you. And then, just for the follow-up, Horacio, thanks for the update on Vision 2020, and the look in there. You had been talking a little bit more in recent calls about M&A than you had before. We saw the dividend of course this quarter after special dividend after not seeing one last quarter. Could you speak a little bit about the role of M&A in Vision 2020, I guess in the intermediate, near to intermediate term here, and what you’re seeing out there our valuations, acceptable, too high, what’s your enthusiasm for M&A?

It’s a great question, and let me just go back to basics. We are building capability in a lot of areas, but three primary ones around engineering, systems delivery, and big data analytics. And in those areas, we are interested in both organic and inorganic growth as to scale up those capabilities. We have a unique opportunity at Booz Allen, because of our operating model is at, the single P&L and the collaborative environment means that if we can find, either we can build something in one market and deploy it across all of our markets, where we can find a company out there that has built a great capability and great position in one market, we can extend that into multiple markets. I would argue faster and better than anybody else. So our interest in doing that is high. It's tampered by the reality of the market, which is the deal flow has slowed down, that we've seen deals priced in a way that frankly we wouldn’t have touched them, and culture does matter to us and so we want a only on board capability and people that will fit with our culture will enhance it. And so we’re going to be selective about this but beyond that we are going to continue to do it assessing, Kevin outlined that beyond obviously having cash flow operations and recurring dividends that is our top priority for capital deployment, so, and we have built a – I think Ralph mentioned for the first time obviously my history with the firm, we built a corporate development office, so that we actually are much better plugged into the flow, whether that will yield a deal and exactly what the timeframe is I think will depend on I guess that finding the right thing for us, but we’re well poised to do it if the opportunity percentage. Joseph Nadol III – JPMorgan: Thank you,

Thank you. Our next question is from Robert Spingam of Credit Sussie, you may begin Robert Spingham – Credit Sussie: Good morning.

Good morning. Robert Spingham – Credit Sussie: Congrats everyone. I will begin if you hear me okay.

We are hearing fine. Robert Spingham – Credit Sussie: Kevin quick question on the guidance and then Horacio on the revenues I had something, but again I know you had that slight adjustment in the quarter but you are guiding to $1.55 for the year and I guess you did $0.50 or $0.47 operating in the quarter so the run rate is higher, how should we think about the back end of the year is this driven by R&D or any other factor.

I think the second half of the year Rob to a large expense is going to be driven by the type of back or the amount of backlog that we book and what’s going to book down to probably the month of September the way the government does this. I think if that happens it will bode well for the second half, but we are kind of taken a wait and see attitude to make sure that, we do get the bookings that we expect or hope for, and then we will reevaluate once we see that in October and preparation for the next quarter call.

The second build on that I think the key for us if you think about our first fiscal quarter, we are running the business extraordinarily tight, and all of our partners and all of our senior staffs are focused on managing this business in a way that is frankly even new for us. I mean we’ve always been very good at managing and controlling the business, but now the level of rigor and the position which our teams are managing things is a whole new world class. The question in the second half becomes how much of a bunch that we build the head of what we think is going to be the immediate demand from all of these backlog and that is really what’s going to drive. From an operation standpoint, how much and how tightly things are running and what drops to the bottom incidents and what creates opportunities for growth in the areas where can grow, I think we are committed to driving to a growth posture as the market permits and in the places where we can do it. And that’s what we are going to be assessing and that’s why we’ve stayed with the guidance as it is. Robert Spingham – Credit Sussie: So, Horacio, that’s a very interesting point. Next, when I said R&D, I should have used the word investment, but should we think about the fact that if you are going a little faster and have more opportunity, the margins might actually be lower because of the investment than if things are a little bit slower?

Hey, Rob, we delivered I think it was 9.7% adjusted EBIRDA margin last year and our goal has been since the IPO to grow 10 basis points year-over-year. I am sure you look at the numbers and you know we’ve knocked the ball out of the park on that every year, but we are still saying that we would expect even with the robust Q1 to deliver at least that 10 basis point improvement in the second half or for the year. Robert Spingham – Credit Sussie: Okay. The other question was a longer term one for Horacio which is – when we think about your longer term trajectory, how much of it would you say would be from a recovery from your government customer versus the Vision 2020?

I don’t think we can split it that way because a lot of our Vision 2020 is about enhancing the way it would serve our clients and getting really finding growth. I mean I think one of the things that we talked a lot about internally and it sometime gets is difficult to convey is, we’re talking about aggregate growth rates or decline rates, but inside of that there is pockets of the business that are growing very rapidly, strong double digit growth. And so whatever we are trying to do is to make sure that those continue to get fuel for investment and for growth, and ultimately that is what’s going to return us to an overall growth posture is when the parts that are growing outpace the parts that are declining. And part of that, we follow the Federal budget, you can’t escape the reality that if an agency’s budget is being cut by a third. It is going to be – we can gain share and I believe we gain share in every one of our markets but you can gain share and still decline which is the case that we’re experiencing now. So I think this is all a combination I think commercial and international may be sort of a more pure incremental growth opportunity there and just given the overall size of our Federal footprint, what you are going to see there I think is more enhancement of margin and bottom line than sheer growth in the numbers because the operating margins in that business have the potential for being two and three times higher than the ones in our government business. But again, with a $5 billion or $6 billion government business footprint, it’s not going to – it is easier for commercial and international business to move the bottom than it would be to move the top by itself. Robert Spingham – Credit Sussie: Okay. That color is very helpful. And then, Kevin, just a clarification, with the guidance for revenue guidance for down mid single digit for the year, would you expect – what bookings are embedded there. Would it be like a 0.95 and make sure you have a positive quarter at some point this year at the end?

Rob, I think one of the reasons why I’m still comfortable with the down mid single digits is, our third quarter is not going to have a government shutdown like. At least we are not anticipating a government shutdown like we had last years. I think the growth rate will be improved over what we saw here in the first quarter, just to give you one example. So we are still comfortable with both the top and the bottom line guidance we provided. Robert Spingham – Credit Sussie: Thank you guys.

Thank you. Our next question is from Cai von Rumohr of Cowen. You may begin. Cai von Rumohr – Cowen and Company: Yes. Thank you very much. So you guys were present in predicting that after the government shutdown that we would get kind of a snapback in bookings which we’re getting. But because its O&M money, where they either have to kind of award it or lose it, do you have any sense as you look forward whether the next fiscal year we can have top line revenue growth or we just – we are in a catch up phase now and we’re kind of go back to normal which is really going to be still down somewhat.

Hi, it’s Kevin, I’ll take a shot at that. I think what you’re asking us to do is predict what is going to happen in Washington D.C. on capital, one would not want to walk down on that limb. The one scenario would be that, they are learning their lesson and we’re going to may be start to focus on entitlement reform, which is really what we need to do to get the budget back in order in spite of focusing solely on discretionary budgets. You could ask three people and probably get five opinions about whether that will happen or not. So I think it is conjunction at this point which I’m not sure I really want to walk out of that what you said.

I would agree with Kevin that we not make predictions about what Congress is or isn’t going to do. I think for our part, we are completely focused on returning to growth. We’re investing heavily to do so. We’re leaning forward in every place where we prudently think the opportunities exist. It is too soon to speculate exactly which quarter or which year we can or will get there, but that’s where we’re going, that’s our goal, that’s our commitment internally, because growth is what generate success and ultimately in a professional services firm, it allows you to retain the best people and create opportunities. So that’s our direction of travel. As I said, I can’t prove these to you mathematically, but at least my read of the numbers, and hopefully you’d agree, so even in a down market, we continue to gain share. So if the market begins to stabilize and we continue to gain share, we have to return to growth faster than anybody else is the way I think about it. Cai von Rumohr – Cowen and Company: With that said, Horacio, could you may be update us on your commercial and international, how big is it, how fast it’s growing and may be some of the other areas you mentioned that are growing faster than the total?

We’ve made it a policy to not get into relatively smaller pieces of the business, and put numbers out there, because first of all we could spend more time calculating the numbers than collaborating to generate them. And in the way we run our business, the growth manifests in lots of different places, but in general our – all the areas that we talked about, commercial and international are the fastest growing portion of our portfolio, very strong into the double digits. Our health business, C4ISR, our analytics business, they are all growing quickly. We have a huge pipeline in the systems delivery area. So all of the areas which we say that are our focus are the places where if you look into our pipeline of proposals, is where we’re seeing the heaviest activity. And so, that’s why we’re optimistic that our strategy is not, strategy for the future is the strategy for the present that fuels the future. Cai von Rumohr – Cowen and Company: Thank you very much.

Thank you. Our next question is from Jason Gursky of Citi. You may begin.

It’s actually [John Ervin] (ph) on for Jason this morning. Congrats to all the new positions. Just following up on Cai’s question on the C&I, I wonder if you could talk about how those two to three times higher margins trend as that business trends itself, is two to three times higher margin a long-term goal or is that the kind of profitability you can expect right out of the gate?

Again, the way we run business internally, we don’t break the overall P&L into little P&Ls. But in general, right now, we’re investing very heavily through the growth phase. And so, but we believe, based on both, call it the job profit margin, and our prior experience and our competitors’ experience in that space, that these two to three times margin is sort of the, call it the long-term average. At this point, we're leaning forward and trying to grow and investing heavily in those businesses, and in these kind of business we invest through the P&L, so I couldn't begin to tell you exactly what the precise profitability of the business is right now, and frankly that’s not, it’s not the way we run the business, we are reinvesting heavily to grow and to achieve what kind of results we’ll be talking about.

That's fair. Understood. And then just a quick follow-up on free cash flow conversion. You pointed out how there are couple of moving pieces this quarter, but I just want to check in on what you think the right free cash flow conversion target should be? So we still think about 120%, and I guess related to that CapEx growth late in the first quarter, how does that trend over the rest of year, of course knowing that you cannot ramp as the year goes on. Thanks.

The 120% is a good target number, some years could be a little more, some years could be a little less, but that’s probably what it's going to average. Relative to CapEx, it is down. I would expect to see it ramp up above the first quarter amount as we begin to build out a couple new facilities or expanded facilities I should say in D.C. metro area, but nothing to get back to the level that we were several years ago, which was about 1% of sales, will be probably three quarters of a percentage sales or below.

Great. Thanks very much.

Thank you. Our next question is from Edward Caso of Wells Fargo Securities. You may begin. Edward Caso – Wells Fargo Securities: Hi, good morning. Congrats to all and congrats on the quarter. I was curious about the satellite that you talked about, did you put your cash to work to do that or was that funded by the client, and if you put your cash to work, is that a change in approach for the company to be, maybe a little bit more capital intensive?

Hey, it’s Kevin. We have talk for years now about the internal investments we make into different areas, whether it’s products, whether it’s data analytics, whether it’s into commercial international, and this is something that came out of strategic innovation group that was formed as part of that Vision 2020. And there is a huge market developing for CubeSats, and we have the engineering and technical capability in-house, and we intend to participate in that market. So I think it’s just one of the examples of the things that Roz has been talking about for the last I guess year and a half through his Vision 2020 discussions.

I would build on that by saying that the magic of this CubeSat is, we are not trying to compete with a major satellite people, that’s not the business that we are in or that we intend to be. And the magic of what the team have achieved is that both the design timeline and the implementation timeline and the overall cost is minuscule as compared to what’s out there which then allows our clients to think about this whole thing in a different way and solve problems that before they may not be willing or able to try and solve because some of these technologies you need to test them out there, but they are too expensive as currently configured to actually test them because he just can’t afford the failure. We are building things for our clients and this is one [differentiation] that changes the dynamic completely and so you can afford to try new things and see if they work and have they work. And CubeSat is, we talk a lot about it because it captures the imagination and is easier to describe, but it is one of many ways in which we are solving problems by applying our consulting expertise together with our domain knowledge, together with engineering and system delivery, and being – doing integration. I see that frankly is again years faster than traditional delivery. Edward Caso – Wells Fargo Securities: Just to clarify, do you own the satellite or it is the client?

We own the satellite. Edward Caso – Wells Fargo Securities: You own it, okay. And could there be more of that in the future where you are sort of taking some level of call it principle risk?

Well, we’ll see how this one goes. I mean I think we would continue down this path everything being equal. I don’t anticipate any additional risk. I mean as Horacio said, we are not building a rocket that takes this thing up there, we are not competing with little science, this is more of a niche because of the efficiency of the cost that it takes to put something up there.

I would answer for this question, yes, we will do more of it and no, it does not alter the capital intensity of our business. Edward Caso – Wells Fargo Securities: Terrific. The other question is on pricing of re-competes on a sort of as best you can on an apples-to-apples basis. What are you seeing as far as relative pricing to the prior contract?

It continues to be a very competitive market, there is no doubt about it. But we’ve been in this type of market before and we know how to succeed and we are winning there the same percentage of our re-competes at price points we can deliver at and so we are comfortable in the market. We’d rather see it, be back in the three or four years ago, but we’re dealing with the current environment, and wining at least our fair share, if not taking a share, based on what Horacio said earlier.

Yeah, yeah. I’ll elaborate on that, I think there’s still some multiple erosion in some parts of the market, but the good news is that, this sort of everything LPTA trend tends to be, is beginning to be tampered by the reality of when you get what you pay for. And so a number of our clients, especially the ones that went kind of all LPTA all the early on are beginning to realize that some of those moves save the money and some of those moves cost them a lot of money and are beginning to discriminate more between things that are mission critical that need to be done at best value and things that are really commodity that ought to be bought as such. And so we expect that trend to slowly sort of get the market back to pricing equilibrium and like Kevin said, we are in the mean time managing very aggressively to stay competitive, and to have our cost buildup match our price requirement.

Thanks and congratulations.

Thank you.

Thank you. Our next question is from Tim McHugh of William Blair. You may begin.

Good morning. This Matt in for Tim McHugh, a couple of questions related to the improved spending environment, I’m wondering if you could give any sort of breakdown within Intel, civil defense if there’s any differences you are seeing there. And then, you’d briefly mentioned the stocking about, how tightly you run the business is, if the spending environment kind of plays out like you’re hoping it does is the – we come to the federal year end, would we start to see some potential for headcount increases to support that?

Couple of questions there, I’d say the spending or the awards are broad-based across all our markets, I talked earlier and more about the defense and the intelligence markets for example, we won the spot on the $7 billion Renata contract in the health market. So it is certainly broad-based, I’m trying to remember the other part of your question. In a typical year, typical meaning three, four years ago, we would begin to ramp up our head count, now in anticipation of contract awards and the result of bookings that were coming in October. We’ve moved away from that in the last couple of years, as Ralph was managing the business very tightly, and it’s more of a just in time recruiting situation. That said, if in fact we continue to see the award activity being robust in nature and continue to believe we are going to be see a plus up in backlog then we will obviously ramp up on the recruiting side to be able to prosecute that work after the end of the September.

Okay, great. And then one other one on the private new partners you added in the Middle East, can you give any sense of where the background of these guys on, how significant are these additions based on salary operations you had there?

They are the five partners are all from the region, all have a track record of building business in their firms that we compete with their background is really on the strategy and call a technology strategy side which is a great complement to the very strong technical capabilities for building in the region, an over time we could as a result of these visions we would hope to may be double or triple even quadruple capacity. These our clients in the area but again much like in the rest of our business. We are going to generate demand first, and then generate supply either a concurrent or shortly after but we are not going to get too far in front of that. Now having said that in that part of the world, it does make sense to begin to higher more quickly and ramp up more quickly because unlike in the federal market proposal activity can happen much faster. So this is a reason we talk about is this is a very significant addition to our talent base there and a sort of indication that we are looking to over a next couple of years grow, kind of by factor those businesses is their presence.

Great. Thank you.

Thank you. There are no further questions in the queue. I’d like to turn the conference back over to Ralph Shrader for closing remarks.

Thank you, Shannon. And in summary I hope we’ve conveyed our pride and excitement about Booz Allen’s continued performance despite a challenging market and about how our growth strategies unfolding. We’re carefully managing the current business with our vision and investment focused on the future. Our revenue and earnings are on track with our full year fiscal 2015 guidance, which we have reaffirmed here this morning. We are seeing positive trends in adjusted EBITDA margin, free cash flow, funded backlog and book-to-bill. We continue to return value to our shareholders to the regular and special dividends or broadly we are seeing increased proposal activity and general improvement in procurement climate. We are implementing a smooth leadership transition to long tenured and well prepared successors in the CEO and CFO positions. All these developments we believe are cause for optimism. With that, I wish you a good rest of the summer, and thank you all for joining us here this morning.

Ladies and gentlemen, this concludes today’s conference. Thank you for your participation and have a wonderful day.