0000785557-24-000067 | 10-K | XBRL Viewer

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Stock-based Compensation and Equity Grants - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Number of Shares
Outstanding at beginning of period (in shares)	2,278
Exercised (in shares)	(760)
Cancelled (in shares)	(282)
Outstanding at end of period (in shares)	1,236	2,278
Exercisable at end of period (in shares)	1,177
Weighted Average Exercise Price
Outstanding at beginning of period (in dollars per share)	$ 8.40
Exercised (in dollars per share)	4.12
Cancelled (in dollars per share)	14.73
Outstanding at end of period (in dollars per share)	9.28	$ 8.40
Exercisable at end of period (in dollars per share)	$ 9.37
Weighted Average Remaining Contractual Term (in years)
Weighted Average Remaining Contractual Term, Options Outstanding at beginning of period (in years)	6 years 1 month 6 days	5 years 9 months 18 days
Weighted Average Remaining Contractual Term, Options Outstanding at period end (in years)	6 years 1 month 6 days	5 years 9 months 18 days
Weighted Average Remaining Contractual Term, Options Exercisable at period end (in years)	6 years
Aggregate Intrinsic Value
Aggregate Intrinsic Value for Options Outstanding at beginning of period	$ 8,693
Aggregate Intrinsic Value for Options Outstanding at period end	1,313	$ 8,693
Aggregate Intrinsic Value Options Outstanding at period end	$ 1,313

Credit Facilities (Tables)

12 Months Ended

Sep. 30, 2024

Cash and Cash Equivalents [Abstract]

Schedule of Loan Facilities and Subordinated Debt Financing

A summary of our credit facilities as presented on our consolidated balance sheets as follows (in millions):

September 30, 2024

September 30, 2023

Arrangement

Loan Balance

Interest

Arrangement

Loan Balance

Interest

Secured term loan (a) due December 8, 2027

142.5

SOFR1 + 4.1%

Secured term loan (a) due December 8, 2027

169.8

SOFR1 + 4.1%

Secured revolving line of credit (b) due December 8, 2027

12.1

SOFR1 + 4.1%

Secured revolving line of credit (b) due December 8, 2027

9.5

SOFR1 + 4.1%

1Secured Overnight Financing Rate ("SOFR") as of September 30, 2024 and September 30, 2023 was 5.2% and 5.3%, respectively.

(a) Represents the principal amounts payable on our term loan, which is secured by liens on substantially all of the assets of the Company. The principal of the term loan is payable in quarterly installments with the remaining balance due on December 8, 2027.

On January 31, 2023, we executed a floating-to-fixed interest rate swap with First National Bank ("FNB") with FNB which has a notional amount of $80.0 million at September 30, 2024, a fixed interest rate of 4.10% and a maturity date of January 31, 2026. As a result of entering interest rate swap agreements, for the twelve months ended September 30, 2024, interest expense has been decreased by $1.3 million, respectively.

The Credit Agreement requires compliance with a number of financial covenants and contains restrictions on our ability to engage in certain transactions. Among other matters, we must comply with limitations on: granting liens; incurring other indebtedness; maintenance of assets; investments in other entities and extensions of credit; mergers and consolidations; and changes in nature of business. The loan agreement also requires us to comply with certain quarterly financial covenants including: (i) a minimum fixed charge coverage ratio of at least 1.25 to 1.00, and (ii) a total leverage ratio not exceeding the ratio of 4.50:1.00 to 2.00:1.00 through maturity. The total leverage ratio is calculated by dividing the Company's total interest-bearing debt by net income adjusted to exclude (i) interest and other expenses, (ii) provision for or benefit from income taxes, if any, (iii) depreciation and amortization, and (iv) non-cash charges, losses or expenses, including stock-based compensation, and (v) non-recurring charges, losses or expenses to include transaction and non-cash equity expense. We are in compliance with all loan covenants and restrictions as of September 30, 2024.

We are required to pay quarterly amortization payments, which commenced in December 2022. The annual amortization amounts are $14.3 million for fiscal year 2024, $19.0 million each for fiscal years 2025 and 2026, and $23.8 million for fiscal year 2027, with the remaining unpaid loan balance due at maturity in December 2027. The quarterly payments are equal installments. The Company made voluntary prepayments of $19.0 million during the twelve months ended September 30, 2024 bringing the outstanding principal balance on the secured term loan to $142.5 million. We have satisfied the mandatory principal payments through September 30, 2025.

In addition to quarterly payments of the outstanding indebtedness, the loan agreement also requires annual payments of a percentage of excess cash flow, as defined in the loan agreement. The loan agreement states that an excess cash flow recapture payment must be made equal to (a) 75% of the excess cash flow for the immediately preceding fiscal year in which indebtedness to consolidated EBITDA ratio is greater than or equal to 2.50:1.00; (b) 50% of the excess cash flow for the immediately preceding fiscal year in which the funded indebtedness to consolidated EBITDA Ratio is less than 2.50:1.00 but greater than or equal to 1.50:1.00; or (c) 0% of the excess cash flow for the immediately preceding fiscal year in which the funded indebtedness to consolidated EBITDA Ratio is less than 1.50:1.00. In addition, the Company must make additional mandatory prepayment of amounts outstanding based on proceeds received from asset sales and sales of certain equity securities or other indebtedness. Due to the voluntary prepayment of term debt, there was no excess cash flow payment required. For additional information regarding the schedule of future payment obligations, please refer to Note 1 0 Commitments and Contingencies.

(b) The secured revolving line of credit has a ceiling of up to $32.5 million; as of September 30, 2024, we had unused borrowing capacity of $18.1 million, which is net of outstanding letters of credit. Borrowing on the secured revolving line of credit is secured by liens on substantially all of the assets of the Company. The Company accessed funds from the secured revolving line of credit during the year, which had a $12.1 million outstanding balance at September 30, 2024. As part of the secured revolving line of credit, the lenders agreed to a sublimit of $10.0 million for letters of credit for the account of the Company, subject to applicable procedures.

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Numerator:
Net income	$ 7,397	$ 1,461
Denominator:
Denominator for basic net income per share - weighted-average outstanding shares (in shares)	14,169	13,704
Effect of dilutive securities:
Stock options and restricted stock (in shares)	236	727
Denominator for diluted net income per share - weighted-average outstanding shares (in shares)	14,405	14,431
Net income per share - basic (in dollars per share)	$ 0.52	$ 0.11
Net income per share - diluted (in dollars per share)	$ 0.51	$ 0.10

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

- Definition

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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+ Details

Stock-based Compensation and Equity Grants (Tables)

12 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Stock-based Compensation Expense

Total stock-based compensation expense, presented in the table below, is recorded in general and administrative expenses included in our consolidated statements of operations for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
DLH employees (a)	$	1,280	$	1,204
Non-employee directors (b)	618		718
Stock option expense	$	1,898	$	1,922

(a): Included in this amount are equity grants of restricted stock units ("RSU") to Executive Officers, which were issued in accordance with the DLH long-term incentive compensation policy in this fiscal year, and stock option grants to employees during prior fiscal years. The RSUs issued and outstanding totaled 316,863 and 211,228 at September 30, 2024 and 2023, respectively. During the fiscal year ended September 30, 2024, 169,544 RSUs were granted to Executive Officers. Of the RSUs granted, 84,773 have performance-based vesting criteria and the remaining 84,771 have service-based vesting criteria. At a 50% volatility and assumptions of a 3-year term and the performance vesting criteria results in an indicated a fair value. The RSUs granted during the fiscal year ended September 30, 2024, as follows using the Monte Carlo Method.


				Volatility
				50%
Grant Date	Performance Vesting Base	Performance Vesting Criteria	(Years)	Calculated Fair Value
December 15, 2023	Revenue	Revenue increase at the end of the performance period as compared to the year ended September 30, 2023	3	$	3.82
December 15, 2023	Stock price	Stock price is at least $25.65 per share average for the 30 days prior to the end of the performance period	3	$	5.36
January 27, 2023	Revenue	Revenue increase at the end of the performance period as compared to the year ended September 30, 2022	3	$	3.51
January 27, 2023	Stock price	Stock price is at least $33.21 per share average for the 30 days prior to the end of the performance period	3	$	2.92
Notes: Results based on 100,000 simulations

(b): Equity grants of RSUs were made in accordance with DLH compensation policy for non-employee directors and a total of 61,525 and 50,367 restricted stock units were issued and outstanding at September 30, 2024 and 2023, respectively. These grants have service-based vesting criteria and vest at the end of this fiscal year.

Unrecognized stock-based compensation expense

Unrecognized stock-based compensation expense is presented in the table below for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Unrecognized expense for DLH employees (a)	$	4,417	$	7,107

Unrecognized expense	$	4,417	$	7,107

(a): On a weighted average basis, this expense is expected to be recognized within the next 2.98 years.

Schedule of Stock Option Activity

A summary of the Company's stock option awards is as follows:


				Weighted
		Weighted		Average
		Average		Remaining	Aggregate
	Number of	Exercise		Contractual	Intrinsic
	Shares	Price		Term	Value
	(in thousands)			(in years)	(in thousands)
Outstanding, September 30, 2023	2,278	$	8.40	5.8	$	8,693

Exercised	(760)	4.12		—	—
Cancelled	(282)	14.73		—	—
Outstanding, September 30, 2024	1,236	$	9.28	6.1	$	1,313
Vested and exercisable, September 30, 2024	1,177	$	9.37	6.0	$	1,313

Schedule of Stock Option Shares Outstanding, Vested and Expected to Vest

Stock options shares outstanding, vested and unvested for the years ended September 30, 2024 and 2023 (in thousands):


	Number of Shares
	2024	2023
Vested and exercisable	1,176	1,608
Unvested (a)	60	670
Options outstanding	1,236	2,278

(a): Certain awards vest upon satisfaction of certain performance criteria.

Supporting Financial Information - Accounts Payable, Accrued Expense and Other Current Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounts payable	$ 13,421	$ 12,603
Accrued benefits	4,519	6,414
Accrued bonus and incentive compensation	3,641	4,719
Accrued workers' compensation insurance	1,528	2,369
Accrued interest	619	1,309
Other accrued expenses	1,562	2,290
Accounts payable and accrued liabilities	$ 25,290	$ 29,704

Significant Accounting Policies (Details) - USD ($)	12 Months Ended
Significant Accounting Policies (Details) - USD ($)	Sep. 30, 2024	Sep. 30, 2023
Significant Accounting policies disclosures [Line Items]
Finite-lived intangibles estimated useful lives	10 years
Goodwill impairment loss	$ 0	$ 0
Uncertain tax positions	0	0
Tax interest	0	0
Tax penalties	0	0
Allowance for doubtful accounts	$ 0	$ 0
Treasury stock (in shares)	0	0
Authorized shares of preferred stock (shares)	5,000,000
Issued preferred stock (shares)	0	0
Minimum
Significant Accounting policies disclosures [Line Items]
Estimated useful asset lives	3 years
Minimum \| Facilities and Equipment
Significant Accounting policies disclosures [Line Items]
Remaining lease term	1 year
Maximum
Significant Accounting policies disclosures [Line Items]
Estimated useful asset lives	7 years
Maximum \| Facilities and Equipment
Significant Accounting policies disclosures [Line Items]
Remaining lease term	6 years 6 months

Employee Benefit Plans	12 Months Ended
Employee Benefit Plans	Sep. 30, 2024
Retirement Benefits [Abstract]
Employee Benefits Plans	Employee Benefit Plans As of September 30, 2024, the Company maintains a 401(k) Plan (the "401(k) Plan"), a defined contribution and supplemental pension plan for the benefit of its eligible employees. The Company may provide a discretionary matching contribution of a participant's elective contributions under the 401(k) Plan. The Company recorded related expense of $3.4 million and $2.6 million for the years ending September 30, 2024 and 2023, respectively. Participants are always fully vested in their elective contributions and vest in Company matching contributions over a four-year period.

- Definition

The entire disclosure for retirement benefits.

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-URI https://asc.fasb.org/1943274/2147480506/715-20-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/715/tableOfContent

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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section S99
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147480266/715-60-50-3

+ Details

Supporting Financial Information - Intangible Assets, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 164,542	$ 164,542
Accumulated amortization	(56,221)	(39,765)
Intangible assets, net	108,321	124,777
Customer contracts and related customer relationships
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	113,622	113,622
Accumulated amortization	(41,297)	(29,929)
Backlog
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	37,249	37,249
Accumulated amortization	(10,994)	(7,273)
Trade names
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	13,034	13,034
Accumulated amortization	(3,488)	(2,185)
Covenants-not-to-compete
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	637	637
Accumulated amortization	$ (442)	$ (378)

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Leases - Company's Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Leases [Abstract]
2025	$ 3,536
2026	3,305
2027	2,706
2028	2,557
2029	2,646
Thereafter	3,788
Total future minimum lease payments	18,538
Less: imputed interest	(3,097)
Operating lease liabilities	15,441	$ 19,371
Less: current portion of operating lease liabilities	(2,652)	(3,463)
Long-term operating lease liabilities	$ 12,789	$ 15,908

New Accounting Pronouncements	12 Months Ended
New Accounting Pronouncements	Sep. 30, 2024
Accounting Changes and Error Corrections [Abstract]
New Accounting Pronouncements	New Accounting Pronouncements In November 2023, Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07 "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures" which provides guidance intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, and each reported measure of segment profit or loss. The ASU requires that a public entity that has a single reportable segment provide all the disclosures required by the amendments in this ASU and all existing segment disclosures in Topic 280. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024. We are currently evaluating the impacts of the single reportable segment disclosures. In December 2023, FASB issued ASU 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" which provides guidance on the requirements such as the requirement that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. DLH is a public company that reports income tax disclosures and therefore this ASU applies to the Company. ASU 2023-09 is effective for public business entities for fiscal years beginning after Dec. 15, 2024. We are currently evaluating the impacts of the improvements to income tax disclosure. In March 2024, FASB issued ASU No. 2024-01, "Scope Application of Profits Interest and Similar Awards". The ASU clarifies how an entity determines whether a profits interest or similar award is (1) within the scope of ASC 718 or (2) not a share-based payment arrangement and therefore within the scope of other guidance. The guidance in ASU 2024-01 applies to all entities that issue profits interest awards as compensation to employees or non-employees in exchange for goods or services. We are currently evaluating the impacts of the improvements to our disclosure. In March 2024, the Securities and Exchange Commission ("SEC") has released a final rule that requires registrants to provide comprehensive climate-related disclosures in their annual reports and registration statements, including those for IPOs, beginning with annual reports for the year ending December 31, 2027, for smaller reporting companies ("SRC"). Registrants must disclose climate-related financial metrics and impacts on their financial estimates and assumptions in a footnote to the audited financial statements. The disclosures will also need to be addressed as part of management’s internal control over financial reporting ("ICFR") and will be subject to the financial statement and ICFR audit (if applicable) of an independent registered public accounting firm. We are currently evaluating the impacts of the improvements to our disclosure.

- Definition

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
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Reference 19: http://www.xbrl.org/2003/role/disclosureRef
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Reference 20: http://www.xbrl.org/2003/role/disclosureRef
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Reference 21: http://www.xbrl.org/2003/role/disclosureRef
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Reference 22: http://www.xbrl.org/2003/role/disclosureRef
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Reference 23: http://www.xbrl.org/2003/role/disclosureRef
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Reference 24: http://www.xbrl.org/2003/role/disclosureRef
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Reference 25: http://www.xbrl.org/2003/role/disclosureRef
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Reference 26: http://www.xbrl.org/2003/role/disclosureRef
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Reference 27: http://www.xbrl.org/2003/role/disclosureRef
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Reference 28: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480175/815-40-65-1

+ Details

Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Disaggregation of Revenue [Line Items]
Revenue	$ 395,937	$ 375,872
Prime Contractor
Disaggregation of Revenue [Line Items]
Revenue	355,147	356,792
Subcontractor
Disaggregation of Revenue [Line Items]
Revenue	40,790	19,080
Time and Materials
Disaggregation of Revenue [Line Items]
Revenue	215,341	209,951
Cost Reimbursable
Disaggregation of Revenue [Line Items]
Revenue	79,481	81,797
Firm Fixed Price
Disaggregation of Revenue [Line Items]
Revenue	101,115	84,124
Department of Health and Human Services \| Revenue Concentration \| Customer Concentration
Disaggregation of Revenue [Line Items]
Revenue	184,544	161,311
Department of Veterans Affairs \| Revenue Concentration \| Customer Concentration
Disaggregation of Revenue [Line Items]
Revenue	139,945	138,862
Department of Defense \| Revenue Concentration \| Customer Concentration
Disaggregation of Revenue [Line Items]
Revenue	64,128	70,325
Other \| Revenue Concentration \| Customer Concentration
Disaggregation of Revenue [Line Items]
Revenue	$ 7,320	$ 5,374

Leases

12 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

The following table summarizes lease balances presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Operating lease right-of-use assets	$	6,681	$	9,656

Operating lease liabilities, current	$	2,652	$	3,463
Operating lease liabilities, long-term	12,789		15,908
Operating lease liabilities	$	15,441	$	19,371

For the years ended September 30, 2024 and 2023, total lease costs for our operating leases are as follows (in thousands):


	2024		2023
Operating	$	3,841	$	3,911
Short-term	290		287
Variable	92		95
Sublease income (a)	(269)		(282)
Lease costs	$	3,954	$	4,011

(a): The Company subleases a portion of one of its leased facilities. The sublease is classified as an operating lease with respect to the underlying asset. The sublease term is 5 years and includes two additional 1-year term extension options.

The Company's future minimum lease payments as of September 30, 2024 are as follows (in thousands):


Fiscal year ending:
2025	$	3,536
2026	3,305
2027	2,706
2028	2,557
2029	2,646
Thereafter	3,788
Total future minimum lease payments	18,538
Less: imputed interest	(3,097)
Present value of future minimum lease payments	15,441
Less: current portion of operating lease liabilities	(2,652)
Long-term operating lease liabilities	$	12,789

At September 30, 2024, the weighted-average remaining lease term and weighted-average discount rate are 5.8 years and 6.3%, respectively. The calculation of the weighted-average discount rate was determined based on borrowing terms from our secured term loan.

Other information related to our leases is as follows for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Cash paid for amounts included in the measurement of lease liabilities	$	4,572	$	4,468
New lease liabilities, net of new right-of-use-assets	—		120
Other lease information	$	4,572	$	4,588

Leases - Narrative (Details)	12 Months Ended
Leases - Narrative (Details)	Sep. 30, 2024 sublease sublease_option
Leases [Abstract]
Number of subleased facilities \| sublease	1
Sublease term	5 years
Number of sublease extension options \| sublease_option	2
Sublease option extension period	1 year
Weighted-average remaining lease term	5 years 9 months 18 days
Weighted-average discount rate	6.30%

Stock-based Compensation and Equity Grants - Stock-based Compensation Expense (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total compensation expense	$ 1,898	$ 1,922
December 15, 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Minimum average price (in dollars per share)	$ 25.65
January, 27 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Minimum average price (in dollars per share)	$ 33.21
Restricted Stock Units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of restricted stock units issued (in shares)	316,863	211,228
Term	3 years
Performance Based Restricted Stock Awards Revenue \| December 15, 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Term	3 years
Calculated fair value (in dollars per share)	$ 3.82
Performance Based Restricted Stock Awards Revenue \| January, 27 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Term	3 years
Calculated fair value (in dollars per share)	$ 3.51
Performance Based Restricted Stock Awards Stock Price \| December 15, 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Term	3 years
Calculated fair value (in dollars per share)	$ 5.36
Performance Based Restricted Stock Awards Stock Price \| January, 27 2023
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Term	3 years
Calculated fair value (in dollars per share)	$ 2.92
DLH Employees
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized expense for DLH employees	$ 4,417	$ 7,107
Weighted average period for recognition of compensation expense	2 years 11 months 23 days
DLH Employees \| Selling, General and Administrative Expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total compensation expense	$ 1,280	$ 1,204
Non-employee Directors \| Restricted Stock Units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of restricted stocks vested in period (in shares)	61,525	50,367
Non-employee Directors \| Selling, General and Administrative Expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total compensation expense	$ 618	$ 718
NEO \| Restricted Stock Units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of restricted stock units issued (in shares)	169,544
Volatility rate	50.00%
NEO \| Performance Shares
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of restricted stock units issued (in shares)	84,773
NEO \| Service Based Restricted Stock Units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Number of restricted stock units issued (in shares)	84,771

Leases - Lease Costs (Details) - USD ($) $ in Thousands	12 Months Ended
Leases - Lease Costs (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Leases [Abstract]
Operating Lease, Cost	$ 3,841	$ 3,911
Short-term	290	287
Variable	92	95
Sublease Income	(269)	(282)
Lease costs	$ 3,954	$ 4,011

Stock-based Compensation and Equity Grants - Narrative (Details) - Stock Options shares in Millions	12 Months Ended
	Sep. 30, 2024 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term of options	10 years
Number of shares available for grant (in shares)	1.1
2016 Omnibus Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term of options	10 years

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480483/718-10-35-1D

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
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-URI https://asc.fasb.org/1943274/2147480483/718-10-35-3

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+ Details

Revenue Recognition

12 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

The following table summarizes the contract balances recognized in accounts receivable within the Company's consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Contract assets	$	23,945	$	20,542

The change from prior period is primarily due to invoice timing and increased revenue volume.

Disaggregation of revenue from contracts with customers

We disaggregate our revenue from contracts with customers by customer, contract type, as well as whether the Company acts as prime contractor or subcontractor. We believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. The following series of tables presents our revenue disaggregated by these categories:

Revenue by customer for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Department of Health and Human Services	$	184,544	$	161,311
Department of Veterans Affairs	139,945		138,862
Department of Defense	64,128		70,325

Other	7,320		5,374
Revenue	$	395,937	$	375,872

Revenue by contract type for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Time and Materials	$	215,341	$	209,951
Cost Reimbursable	79,481		81,797
Firm Fixed Price	101,115		84,124
Revenue	$	395,937	$	375,872

Revenue by whether the Company acts as a prime contractor or a subcontractor for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Prime Contractor	$	355,147	$	356,792
Subcontractor	40,790		19,080
Revenue	$	395,937	$	375,872

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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+ Details

Insider Trading Policies and Procedures	12 Months Ended
Insider Trading Policies and Procedures	Sep. 30, 2024
Insider Trading Policies and Procedures [Line Items]
Insider Trading Policies and Procedures Adopted	true

Supporting Financial Information - Debt Obligations (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Debt Instrument [Line Items]
Secured term loan	$ 154,558
Total long-term debt obligations	149,374	$ 172,335
Debt obligations - current, net of deferred financing costs	(12,058)	(17,188)
Debt obligations - long-term, net of deferred financing costs	137,316	155,147
Debt annual amortization amount fiscal year 2025	12,058
Secured revolving line of credit
Debt Instrument [Line Items]
Secured term loan	12,058	9,546
Secured Debt
Debt Instrument [Line Items]
Secured term loan	142,500	169,813
Less: unamortized deferred financing costs	(5,184)	(7,024)
Secured Debt \| Secured revolving line of credit
Debt Instrument [Line Items]
Secured term loan	$ 12,100	$ 9,500

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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+ Details

- Definition

Amount, after deduction of unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Current assets:
Cash	$ 342	$ 215
Accounts receivable	49,849	59,119
Other current assets	2,766	3,067
Total current assets	52,957	62,401
Goodwill	138,161	138,161
Intangible assets, net	108,321	124,777
Operating lease right-of-use assets	6,681	9,656
Deferred taxes, net	6,245	3,070
Equipment and improvements, net	1,830	1,590
Other long-term assets	186	186
Total assets	314,381	339,841
Current liabilities:
Accounts payable and accrued liabilities	25,290	29,704
Accrued payroll	12,848	13,794
Debt obligations - current, net of deferred financing costs	12,058	17,188
Operating lease liabilities - current	2,652	3,463
Other current liabilities	394	638
Total current liabilities	53,242	64,787
Long-term liabilities:
Debt obligations - long-term, net of deferred financing costs	137,316	155,147
Operating lease liabilities - long-term	12,789	15,908
Other long-term liabilities	902	1,560
Total long-term liabilities	151,007	172,615
Total liabilities	204,249	237,402
Shareholders' equity:
Common stock, $0.001 par value; authorized 40,000 shares; issued and outstanding 14,391 and 13,950 at September 30, 2024 and 2023, respectively	14	14
Additional paid-in capital	100,270	99,974
Retained earnings	9,848	2,451
Total shareholders’ equity	110,132	102,439
Total liabilities and shareholders' equity	$ 314,381	$ 339,841

Significant Accounting Policies	12 Months Ended
Significant Accounting Policies	Sep. 30, 2024
Accounting Policies [Abstract]
Significant Accounting Policies	Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. The most significant of these estimates and assumptions relate to costs including valuing and determining the amortization periods for long-lived intangible assets, interest rate swaps, stock-based compensation, right-of-use assets and leases liabilities, and loss development on workers' compensation claims. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current and expected future outcomes, third-party evaluations, and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. We revise material accounting estimates if changes occur, such as more experience is acquired, additional information is obtained, or there is new information on which an estimate was or can be based. Actual results could differ from those estimates. Revenue The Company's revenues from contracts with customers are derived from offerings that include technology-enabled business process outsourcing, program management solutions, and public health research and analytics, substantially within the U.S. government and its agencies. The Company has various types of contracts including time-and-materials contracts, cost-reimbursable contracts, and firm-fixed-price contracts. We consider a contract with a customer to exist when there is a commitment by both parties (customer and Company), payment terms are determinable, there is commercial substance, and collectability is probably in accordance with Accounting Standards Codification ("ASC") No. 606, "Revenue from Contracts with Customers" ("Topic 606"). We recognize revenue over time when there is a continuous transfer of control to our customer as performance obligations are satisfied. For our U.S. government contracts, this continuous transfer of control to the customer is transferred over time and revenue is recognized based on the extent of progress toward completion of the performance obligation. We consider control to transfer when we have a right to payment. In some instances, the Company commences providing services prior to formal approval to begin work from the customer. The Company considers these factors, the risks associated with commencing work, and legal enforceability in determining whether a contract exists under Topic 606. Contract modification can occur throughout the life of the contract and can affect the transaction price, extend the period of performance, adjust funding, or create new performance obligations. We review each modification to assess the impact of these contract changes to determine if it should be treated as part of the original performance obligation or as a separate contract. Contract modifications impact performance obligations when the modification either creates new or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue and profit cumulatively. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. For service contracts, we satisfy our performance obligations as services are rendered. We use cost-based input and time-based output methods to measure progress based on the contract type. •Time and material - We bill the customer per labor hour and per material, and revenue is recognized in the amount invoiced as the amount corresponds directly to the value of our performance to date. Revenue is recognized to the extent of billable rates times hours delivered plus materials and other reimbursable costs incurred. •Cost reimbursable - We record reimbursable costs as incurred, including an estimated share of the contractual fee earned. •Firm fixed price - We recognize revenue over time using a straight-line measure of progress. Contract costs generally include direct costs such as labor, materials, subcontract costs, and indirect costs identifiable with or allocable to a specific contract. Costs are expensed as incurred and include an estimate of the contractual fees earned. Contract assets - Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms. In part, revenue recognition occurs before we have the right to bill, resulting in contract assets. These contract assets are reported within Accounts receivable, net on our consolidated balance sheets and are invoiced in accordance with payment terms defined in each contract. Period end balances will vary from period to period due to agreed-upon contractual terms. Contract liabilities - Amounts are a result of billings in excess of costs incurred or prepayment for services to be rendered. Fair Value of Financial Instruments The carrying amounts of the Company's cash and cash equivalents, accounts receivable, contract assets, contract liabilities, accrued expenses, and accounts payable approximate fair value due to the short-term nature of these instruments. The fair values of the Company's debt instruments approximate fair value because the underlying interest rates approximate market rates that the Company could obtain for similar instruments at the balance sheet dates. Long-lived Assets Our long-lived assets include equipment and improvements, intangible assets, right-of-use assets, and goodwill. The Company reviews its long-lived assets for possible impairment or loss of value at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. Equipment and improvements are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives (3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Maintenance and repair costs are expensed as incurred. Intangible assets (other than goodwill) are originally recorded at fair value and are amortized on a straight-line basis over their estimated useful lives of 10 years. Right-of-use assets are measured at the present value of future minimum lease payments, including all probable renewals, plus lease payments made to the lessor before or at lease commencement and indirect costs paid, less incentives received. Our right-of-use assets include long-term leases for facilities and equipment and are amortized over their respective lease terms. Lease Liabilities The Company has leases for facilities and office equipment. Our lease liabilities are recognized as the present value of the future minimum lease payments over the lease term. Our lease payments consist of fixed and in-substance fixed amounts attributable to the use of the underlying asset over the lease term. Variable lease payments that do not depend on an index rate or are not in-substance fixed payments are excluded in the measurement of right-of-use assets and lease liabilities and are expensed in the period incurred. The incremental borrowing rate on our secured term loan is used in determining the present value of future minimum lease payments. Some of our lease agreements include options to extend the lease term or terminate the lease. These options are accounted for in our right-of-use assets and lease liabilities when it is reasonably certain that the Company will extend the lease term or terminate the lease. The Company does not have any finance leases. As of September 30, 2024, operating leases for facilities and equipment have remaining lease terms of less than 1 year to 6.5 years. Goodwill The Company performs impairment evaluation at least annually and between annual tests whenever there is an indication of impairment. We performed a qualitative assessment of factors to determine whether it was necessary to perform the goodwill impairment test. Based on the results of the work performed, the Company has concluded that no impairment loss was warranted at September 30, 2024, as no change in business conditions occurred which would have a material adverse effect on the valuation of goodwill. Notwithstanding this evaluation, factors including non-renewal of a major contract or other substantial changes in business conditions could have a material adverse effect on the valuation of goodwill in future periods and the resulting charge could be material to future periods’ results of operations. Similarly, there were no impairments during the prior year ended September 30, 2023. Income Taxes The Company accounts for income taxes in accordance with the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the consolidated balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax assets will not be realized. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits, it is more-likely-than-not that the position will be sustained upon examination. We had no uncertain tax positions at either September 30, 2024 and 2023. We report interest and penalties as a component of provision for income taxes. For the years ended September 30, 2024 and 2023, we recognized no interest and no penalties related to income taxes. Stock-based Compensation The Company uses the fair value-based method for stock-based equity compensation. Options issued are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Option awards may depend on the achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued common shares. All awards to employees and non-employees are recorded at fair value on the date of the grant and expensed over the period of vesting. The Company uses the Monte Carlo method to estimate the fair value of each stock option at the date of grant. Any consideration paid by the option holders to purchase shares is credited to capital stock. Stock-based Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The stock-based compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance. For options that vest based on the Company’s common stock achieving and maintaining defined market prices, the Company values the awards with a Monte Carlo method that utilizes various probability factors and other criterion in establishing fair value of the grant. The related stock-based compensation expense is recognized over the service period. Stock based compensation is reliant on continued employment with the Company. These arrangements are forfeited upon employee separation and accounted for as they occur. Cash We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation up to $250,000. Deposits held with financial institutions may exceed the $250,000 limit. Accounts Receivable Receivables include amounts billed and currently due from customers where the right to consideration is unconditional and amounts unbilled. Both billed and unbilled amounts are non-interest bearing, unsecured, and recognized at an estimated realizable value that includes costs and fees, and are generally expected to be billed and received within a single year. We evaluate our receivables for expected credit losses on a quarterly basis and determine whether an allowance for expected credit losses is appropriate based on specific collection issues. No allowance for doubtful accounts was deemed necessary at either September 30, 2024 or September 30, 2023. Earnings Per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common stock outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method. Treasury Stock The Company periodically purchases its own common stock that is traded on public markets as part of announced stock repurchase programs. The repurchased common stock is classified as treasury stock on the consolidated balance sheets and held at cost. As of September 30, 2024 and 2023, the Company did not hold any treasury stock. Preferred Stock Our certificate of incorporation authorizes the issuance of "blank check" preferred stock with such designations, rights and preferences as may be determined from time to time by our board of directors up to an aggregate of 5,000,000 shares of preferred stock. As of September 30, 2024 and 2023, the Company has not issued any preferred stock. Interest Rate Swap The Company uses derivative financial instruments to manage interest rate risk associated with its variable debt. The Company's objective in using these interest rate derivatives is to manage its exposure to interest rate movements and reduce volatility of interest expense. The gains and losses due to changes in the fair value of the interest rate swap agreements completely offset changes in the fair value of the hedged portion of the underlying debt. Offsetting changes in fair value of both the interest rate swaps and the hedged portion of the underlying debt are recognized in interest expense in the consolidated statements of operations. The Company does not hold or issue any derivative instruments for trading or speculative purposes. Risks and Uncertainties Management evaluates the impact of global markets and economic factors on our industry and the potential for adverse effects on the Company's consolidated financial position and its operations. As of September 30, 2024, there was no indication of any global or economic impacts to our industry.

Cover - USD ($)	12 Months Ended
Cover - USD ($)	Sep. 30, 2024	Dec. 02, 2024	Mar. 31, 2024
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Sep. 30, 2024
Current Fiscal Year End Date	--09-30
Document Transition Report	false
Entity File Number	0-18492
Entity Registrant Name	DLH HOLDINGS CORP.
Entity Incorporation, State or Country Code	NJ
Entity Tax Identification Number	22-1899798
Entity Address, Address Line One	3565 Piedmont Road,
Entity Address, Address Line Two	Building 3,
Entity Address, Address Line Three	Suite 700
Entity Address, City or Town	Atlanta,
Entity Address, State or Province	GA
Entity Address, Postal Zip Code	30305
City Area Code	770
Local Phone Number	554-3545
Title of 12(b) Security	Common Stock
Trading Symbol	DLHC
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Document Financial Statement Error Correction [Flag]	false
Entity Shell Company	false
Entity Public Float			$ 113,389,085
Entity Common Stock, Shares Outstanding		14,386,468
Documents Incorporated by Reference	Part III of this report incorporates information by reference from the Company's definitive proxy statement, which proxy statement is due to be filed with the Securities and Exchange Commission not later than 120 days after September 30, 2024.
Entity Central Index Key	0000785557
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	FY

Commitments and Contingencies

12 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Contractual Obligations as of September 30, 2024 (in thousands):


			Payments Due Per Fiscal Year
	Total		2025		2026		2027		2028		2029		Thereafter
Debt obligations	$	154,558	$	12,058	$	19,000	$	23,750	$	99,750	$	—	$	—
Facility operating leases	18,538		3,536		3,305		2,706		2,557		2,646		3,788

Contractual obligations	$	173,096	$	15,594	$	22,305	$	26,456	$	102,307	$	2,646	$	3,788

Legal Proceedings

As a commercial enterprise and employer, the Company is subject to various claims and legal actions in the ordinary course of business. These matters can include professional liability, employment-relations issues, workers’ compensation, tax, payroll and employee-related matters, other commercial disputes arising in the course of its business, and inquiries and investigations by governmental agencies regarding our employment practices or other matters. The Company is not aware of any pending or threatened litigation that it believes is reasonably likely to have a material adverse effect on its results of operations, financial position or cash flows.

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Operating activities
Net income	$ 7,397	$ 1,461
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	17,052	15,562
Amortization of deferred financing costs charged to interest expense	1,839	2,182
Stock-based compensation expense	1,898	1,922
Deferred taxes, net	(3,175)	(4,604)
Impairment loss of long-lived asset	0	7,673
Changes in operating assets and liabilities
Accounts receivable	9,270	6,845
Other assets	3,276	1,757
Accrued payroll	(946)	(3,477)
Accounts payable and accrued liabilities	(4,414)	(75)
Other liabilities	(4,831)	1,787
Net cash provided by operating activities	27,366	31,033
Investing activities
Business acquisition, net of cash acquired	0	(180,572)
Purchase of equipment and improvements	(836)	(625)
Net cash used in investing activities	(836)	(181,197)
Financing activities
Proceeds from revolving line of credit	361,720	205,268
Repayment of revolving line of credit	(359,208)	(195,721)
Proceeds from debt obligations	0	168,000
Repayments of debt obligations	(27,313)	(20,188)
Payments of deferred financing costs	0	(7,666)
Proceeds from issuance of common stock upon exercise of options and warrants	261	1,108
Payment of tax obligations resulting from net exercise of stock options	(1,863)	(650)
Net cash (used in) provided by financing activities	(26,403)	150,151
Net change in cash	127	(13)
Cash - beginning of year	215	228
Cash - end of year	342	215
Supplemental disclosures of cash flow information
Cash paid during the year for interest	16,043	14,153
Cash paid during the year for income taxes	3,264	5,604
Supplemental disclosures of non-cash activity
Common stock surrendered for the exercise of stock options	$ 2,822	$ 238

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Earnings Per Share (Tables)

12 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Schedule of Diluted Earnings Per Share

Earnings Per Share information is presented in the table below for the years ending September 30, 2024 and 2023 (in thousands except for per share amounts):


	2024		2023
Numerator:
Net income	$	7,397	$	1,461
Denominator:
Denominator for basic net income per share - weighted-average outstanding shares	14,169		13,704
Effect of dilutive securities:
Stock options and restricted stock	236		727
Denominator for diluted net income per share - weighted-average outstanding shares	$	14,405	$	14,431
Net income per share - basic	$	0.52	$	0.11
Net income per share - diluted	$	0.51	$	0.10

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Retained Earnings
Beginning Balance (in shares) at Sep. 30, 2022		13,047
Beginning Balance at Sep. 30, 2022	$ 92,060	$ 13	$ 91,057	$ 990
Issuance and fair value adjustment of common stock in business combination (in shares)		527
Issuance and fair value adjustment of common stock in business combination	6,539	$ 1	6,538
Expense related to director restricted stock units	718		718
Expense related to director restricted stock unit (shares)		0
Expense related to employee stock-based compensation	1,204		1,204
Stock issued for director restricted stock units (in shares)		50
Stock issued for director restricted stock units	0
Exercise of stock options (shares)		393
Exercise of stock options	1,107		1,107
Common stock surrendered for the exercise of stock options (in shares)		(67)
Common stock surrendered for the exercise of stock options	(650)		(650)
Net income	$ 1,461			1,461
Ending Balance (in shares) at Sep. 30, 2023	13,950	13,950
Ending Balance at Sep. 30, 2023	$ 102,439	$ 14	99,974	2,451
Expense related to director restricted stock units	618		618
Expense related to employee stock-based compensation	1,280		1,280
Stock issued for director restricted stock units (in shares)		62
Stock issued for director restricted stock units	$ 0
Exercise of stock options (shares)	760	760
Exercise of stock options	$ 261		261
Common stock surrendered for the exercise of stock options (in shares)		(381)
Common stock surrendered for the exercise of stock options	(1,863)		(1,863)
Net income	$ 7,397			7,397
Ending Balance (in shares) at Sep. 30, 2024	14,391	14,391
Ending Balance at Sep. 30, 2024	$ 110,132	$ 14	$ 100,270	$ 9,848

Subsequent Events	12 Months Ended
Subsequent Events	Sep. 30, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events On November 6, 2024, the Company completed an amendment to its credit facility. The amendment modified certain financial covenants thresholds for future measurement periods. The modification did not change the financial covenants thresholds for September 30, 2024. The amendment was approved by the Company's Board of Directors and Executive Management and the credit facility lenders.

Stock-based Compensation and Equity Grants

12 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-based Compensation and Equity Grants

Stock-based compensation expense

Options issued under equity incentive plans were designated as either an incentive stock or a non-statutory stock option. No option was granted with a term of more than 10 years from the date of grant. Exercisability of option awards may depend on achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued shares. As of September 30, 2024, there were 1.1 million shares available for grant.


	2024		2023
DLH employees (a)	$	1,280	$	1,204
Non-employee directors (b)	618		718
Stock option expense	$	1,898	$	1,922


				Volatility
				50%
Grant Date	Performance Vesting Base	Performance Vesting Criteria	(Years)	Calculated Fair Value
December 15, 2023	Revenue	Revenue increase at the end of the performance period as compared to the year ended September 30, 2023	3	$	3.82
December 15, 2023	Stock price	Stock price is at least $25.65 per share average for the 30 days prior to the end of the performance period	3	$	5.36
January 27, 2023	Revenue	Revenue increase at the end of the performance period as compared to the year ended September 30, 2022	3	$	3.51
January 27, 2023	Stock price	Stock price is at least $33.21 per share average for the 30 days prior to the end of the performance period	3	$	2.92
Notes: Results based on 100,000 simulations

Unrecognized stock-based compensation expense

Unrecognized stock-based compensation expense is presented in the table below for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Unrecognized expense for DLH employees (a)	$	4,417	$	7,107

Unrecognized expense	$	4,417	$	7,107

(a): On a weighted average basis, this expense is expected to be recognized within the next 2.98 years.

Stock option activity for the year ended September 30, 2024:

The aggregate intrinsic value in the table below represents the total pretax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, times the number of shares) that would have been received by the option holders had all option holders exercised their in the money options on those dates. This amount will change based on the fair market value of the Company’s stock. A summary of the Company's stock option awards is as follows:


				Weighted
		Weighted		Average
		Average		Remaining	Aggregate
	Number of	Exercise		Contractual	Intrinsic
	Shares	Price		Term	Value
	(in thousands)			(in years)	(in thousands)
Outstanding, September 30, 2023	2,278	$	8.40	5.8	$	8,693

Exercised	(760)	4.12		—	—
Cancelled	(282)	14.73		—	—
Outstanding, September 30, 2024	1,236	$	9.28	6.1	$	1,313
Vested and exercisable, September 30, 2024	1,177	$	9.37	6.0	$	1,313

Stock options shares outstanding, vested and unvested for the years ended September 30, 2024 and 2023 (in thousands):


	Number of Shares
	2024	2023
Vested and exercisable	1,176	1,608
Unvested (a)	60	670
Options outstanding	1,236	2,278

(a): Certain awards vest upon satisfaction of certain performance criteria.

Commitments and Contingencies (Tables)

12 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Schedule of Contractual Obligations

Contractual Obligations as of September 30, 2024 (in thousands):


			Payments Due Per Fiscal Year
	Total		2025		2026		2027		2028		2029		Thereafter
Debt obligations	$	154,558	$	12,058	$	19,000	$	23,750	$	99,750	$	—	$	—
Facility operating leases	18,538		3,536		3,305		2,706		2,557		2,646		3,788

Contractual obligations	$	173,096	$	15,594	$	22,305	$	26,456	$	102,307	$	2,646	$	3,788

Supporting Financial Information - Accrued Payroll (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accrued leave	$ 8,569	$ 9,621
Accrued payroll	3,070	2,487
Accrued payroll taxes	981	1,173
Accrued severance	228	513
Accrued payroll	$ 12,848	$ 13,794

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Income Statement [Abstract]
Revenue	$ 395,937	$ 375,872
Cost of Operations
Contract costs	317,026	296,016
General and administrative costs	36,959	37,795
Impairment loss of long-lived asset	0	7,673
Corporate development costs	0	1,735
Depreciation and amortization	17,052	15,562
Total operating costs	371,037	358,781
Income from operations	24,900	17,091
Interest expense	(17,153)	(16,271)
Income before provision for income taxes	7,747	820
Provision for income tax expense (benefit)	350	(641)
Net income	$ 7,397	$ 1,461
Earnings Per Share [Abstract]
Net income per share - basic (in dollars per share)	$ 0.52	$ 0.11
Net income per share - diluted (in dollars per share)	$ 0.51	$ 0.10
Weighted average common shares outstanding
Basic (in shares)	14,169	13,704
Diluted (in shares)	14,405	14,431

Audit Information	12 Months Ended
Audit Information	Sep. 30, 2024
Auditor Information [Abstract]
Auditor Name	WithumSmith+Brown, PC
Auditor Location	East Brunswick, New Jersey
Auditor Firm ID	100

Related Party Transactions	12 Months Ended
Related Party Transactions	Sep. 30, 2024
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions The Company has determined that for the years ended September 30, 2024 and 2023 and through the filing date of this report, there were no related party transactions that have occurred which require disclosure through the date that these consolidated financial statements were issued.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/1943274/2147480990/946-20-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
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-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-6

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (SX 210.6-07(2)(g)(3))
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-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (SX 210.6-07(2)(c))
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-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(e))
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-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

+ Details

Credit Facilities - Summary of Loan Facilities and Subordinated Debt Financing (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Debt Instrument [Line Items]
Loan Balance	$ 154,558
Debt instrument, interest rate, effective percentage	5.20%	5.30%
Secured revolving line of credit
Debt Instrument [Line Items]
Loan Balance	$ 12,058	$ 9,546
Secured Debt
Debt Instrument [Line Items]
Loan Balance	142,500	169,813
Secured Debt \| Term loan
Debt Instrument [Line Items]
Loan Balance	$ 142,500	$ 169,800
Debt instrument, basis spread on variable rate	4.10%	4.10%
Secured Debt \| Secured revolving line of credit
Debt Instrument [Line Items]
Loan Balance	$ 12,100	$ 9,500
Debt instrument, basis spread on variable rate	4.10%	4.10%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Supporting Financial Information (Tables)

12 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Accounts Receivable

The following table summarizes accounts receivable presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Billed receivables	$	25,904	$	38,577
Contract assets	23,945		20,542

Accounts receivable	$	49,849	$	59,119

Schedule of Other Current Assets

The following table summarizes other current assets presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Prepaid licenses and other expenses	$	1,315	$	1,330
Prepaid insurance and benefits	545		743
Other receivables	906		994
Other current assets	$	2,766	$	3,067

Schedule of Intangible Assets, Net

The following table summarizes intangible assets, net presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Intangible assets
Customer contracts and related customer relationships	$	113,622	$	113,622
Backlog	37,249		37,249
Trade names	13,034		13,034
Covenants-not-to-compete	637		637
Total intangible assets	$	164,542	$	164,542
Less accumulated amortization:
Customer contracts and related customer relationships	(41,297)		(29,929)
Backlog	(10,994)		(7,273)
Trade names	(3,488)		(2,185)
Covenants-not-to-compete	(442)		(378)
Total accumulated amortization	$	(56,221)	$	(39,765)
Intangible assets, net	$	108,321	$	124,777

Schedule of Estimated Future Amortization Expense of Finite-lived Intangibles

As of September 30, 2024, the estimated annual amortization expense is as follows (in thousands):


For the Fiscal Year Ending September 30,
2025	$	16,456
2026	15,722
2027	14,694
2028	14,694
2029	13,734
Thereafter	33,021
Total amortization expense	$	108,321

Schedule of Equipment and Improvements, Net

The following table summarizes equipment and improvements, net presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Furniture and equipment	$	1,832	$	1,790
Computer equipment and software	7,273		6,479
Leasehold improvements	1,614		1,614
Total equipment and improvements	10,719		9,883
Less: accumulated depreciation and amortization	(8,889)		(8,293)
Equipment and improvements, net	$	1,830	$	1,590

Schedule of Accounts Payable, Accrued Expenses, and Other Current Liabilities

The following table summarizes accounts payable and accrued liabilities presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Accounts payable	$	13,421	$	12,603
Accrued benefits	4,519		6,414
Accrued bonus and incentive compensation	3,641		4,719
Accrued workers' compensation insurance	1,528		2,369
Accrued interest	619		1,309
Other accrued expenses	1,562		2,290
Accounts payable and accrued liabilities	$	25,290	$	29,704

Schedule of Accrued Payroll

The following table summarizes accrued payroll presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Accrued leave	$	8,569	$	9,621
Accrued payroll	3,070		2,487
Accrued payroll taxes	981		1,173
Accrued severance	228		513
Accrued payroll	$	12,848	$	13,794

Schedule of Debt Obligations

Debt obligations

The following table summarizes debt obligations presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Secured term loan	$	142,500	$	169,813
Secured revolving line of credit	12,058		9,546
Less: unamortized deferred financing costs	(5,184)		(7,024)
Net bank debt obligations	149,374		172,335
Less: current portion of debt obligations, net of deferred financing costs (a)	(12,058)		(17,188)
Long-term portion of debt obligations, net of deferred financing costs	$	137,316	$	155,147

As of September 30, 2024, we have satisfied mandatory principal payments on our secured term loan.

(a) As of September 30, 2024, the current portion comprises the $12.1 million outstanding balance on the secured revolving line of credit. All fiscal 2025 mandatory loan amortization payments have been satisfied by voluntary prepayments.

Schedule of Interest Expense

Interest expense

The following table summarizes interest expense presented on our consolidated statements of operations for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Interest expense (a)	$	15,352	$	14,153
Interest income (b)	(38)		(64)
Amortization of deferred financing costs (c)	1,839		2,182
Interest expense	$	17,153	$	16,271

(a): Interest expense on borrowing

(b): Interest earned from customer payments received after the due date.

(c): Amortization of expenses related to secured term loan and secured revolving line of credit.

Supporting Financial Information - Accounts Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Billed receivables	$ 25,904	$ 38,577
Contract assets	23,945	20,542
Accounts receivable	$ 49,849	$ 59,119

Revenue Recognition (Tables)

12 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Schedule of Contract Balances Recognized on the Company's Consolidated Balance Sheets

The following table summarizes the contract balances recognized in accounts receivable within the Company's consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Contract assets	$	23,945	$	20,542

Schedule of Disaggregation of Revenue From Contracts with Customers

The following series of tables presents our revenue disaggregated by these categories:

Revenue by customer for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Department of Health and Human Services	$	184,544	$	161,311
Department of Veterans Affairs	139,945		138,862
Department of Defense	64,128		70,325

Other	7,320		5,374
Revenue	$	395,937	$	375,872

Revenue by contract type for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Time and Materials	$	215,341	$	209,951
Cost Reimbursable	79,481		81,797
Firm Fixed Price	101,115		84,124
Revenue	$	395,937	$	375,872

Revenue by whether the Company acts as a prime contractor or a subcontractor for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Prime Contractor	$	355,147	$	356,792
Subcontractor	40,790		19,080
Revenue	$	395,937	$	375,872

Credit Facilities - Narrative (Details) $ in Thousands	12 Months Ended
Credit Facilities - Narrative (Details) $ in Thousands	Sep. 30, 2024 USD ($)	Sep. 30, 2023 USD ($)
Line of Credit Facility [Line Items]
Debt annual amortization amount fiscal year 2024	$ 27,313	$ 20,188
Debt annual amortization amount fiscal year 2025	12,058
Debt annual amortization amount fiscal year 2026	19,000
Debt annual amortization amount fiscal year 2027	23,750
Secured term loan	154,558
Interest Rate Swap
Line of Credit Facility [Line Items]
Decrease in interest expense	1,300
Interest Rate Swap Due 2026
Line of Credit Facility [Line Items]
Notional amount of floating-to-fix interest rate swap	$ 80,000
Fixed interest rate applicable to swaps	4.10%
Secured revolving line of credit
Line of Credit Facility [Line Items]
Secured term loan	$ 12,058	9,546
Secured Debt
Line of Credit Facility [Line Items]
Secured term loan	$ 142,500	169,813
Secured Debt \| Term loan
Line of Credit Facility [Line Items]
Fixed charge coverage ratio	1.25
Debt annual amortization amount fiscal year 2024	$ 14,300
Debt annual amortization amount fiscal year 2025	19,000
Debt annual amortization amount fiscal year 2026	19,000
Debt annual amortization amount fiscal year 2027	23,800
Voluntary repayments of debt	19,000
Secured term loan	$ 142,500	169,800
Secured Debt \| Term loan \| Maximum
Line of Credit Facility [Line Items]
Ratio of funded indebtedness to EBITDA through maturity	4.50
Secured Debt \| Term loan \| Minimum
Line of Credit Facility [Line Items]
Ratio of funded indebtedness to EBITDA through maturity	2.00
Secured Debt \| Term loan \| Excess Cash Flow Greater Than or Equal to 2.50
Line of Credit Facility [Line Items]
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA	75.00%
Ratio of funded indebtedness to adjusted EBIDTA	2.50
Secured Debt \| Term loan \| Excess Cash Flow Less Than 2.50 But Greater Than or Equal to 1.50
Line of Credit Facility [Line Items]
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA	50.00%
Secured Debt \| Term loan \| Excess Cash Flows Less Than 2.50
Line of Credit Facility [Line Items]
Ratio of funded indebtedness to adjusted EBIDTA	2.50
Secured Debt \| Term loan \| Excess Cash Flow Equal to 1.50
Line of Credit Facility [Line Items]
Ratio of funded indebtedness to adjusted EBIDTA	1.50
Secured Debt \| Term loan \| Excess Cash Flow Less Than 1.50
Line of Credit Facility [Line Items]
Percentage of excess cash flow for each year of funded indebtedness to adjusted EBITDA	0.00%
Ratio of funded indebtedness to adjusted EBIDTA	1.50
Secured Debt \| Secured revolving line of credit
Line of Credit Facility [Line Items]
Secured term loan	$ 12,100	$ 9,500
Line of credit ceiling	32,500
Unused borrowing capacity	18,100
Secured Debt \| Letters of credit
Line of Credit Facility [Line Items]
Remaining borrowing availability	$ 10,000

Stock-based Compensation and Equity Grants - Stock Options Outstanding, Vested and Unvested (Details) - shares shares in Thousands	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Vested and exercisable (in shares)	1,176	1,608
Unvested (in shares)	60	670
Options outstanding (in shares)	1,236	2,278

Provision for Income Taxes

12 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The significant components of provision for income taxes from continuing operations are summarized as follows for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Current expense	$	3,525	$	3,823
Deferred expense	(3,175)		(4,464)
Income tax expense (benefit)	$	350	$	(641)

The following table presents the significant differences between our income taxes at the federal statutory rate and the Company's effective tax rate for continuing operations for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Income taxes at the federal statutory rate	$	1,654	$	187
State taxes, net	(200)		(536)
Other permanent items	(1,104)		(292)
Income tax expense (benefit)	$	350	$	(641)

An analysis of the Company's deferred tax assets and liabilities at September 30, 2024 and 2023 is as follows (in thousands):


	2024		2023
Deferred tax assets:
Net operating loss carry forwards, net	$	1,903	$	855
Stock based compensation	732		708
Accrued compensation	2,204		2,094
Capitalized transaction costs	532		973
Right-of-use	1,682		1,669
Interest limitation	6,313		2,601
Total deferred tax assets	$	13,366	$	8,900
Less: valuation allowance	(1,894)		(847)
Total deferred tax assets, net	$	11,472	$	8,053
Deferred tax liabilities:
Depreciation on fixed assets	(402)		(418)
Amortization on identified intangibles and goodwill	(4,364)		(4,050)
Accrued expenses	(461)		(515)

Total deferred tax liabilities	$	(5,227)	$	(4,983)
Net deferred tax assets	$	6,245	$	3,070

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 231
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12C
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12B
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477891/740-270-50-1

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-13

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
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-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/740/tableOfContent

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-14

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-21

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-17

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482603/740-30-50-2

+ Details

Supporting Financial Information - Estimated Amortization Expense of Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
2025	$ 16,456
2026	15,722
2027	14,694
2028	14,694
2029	13,734
Thereafter	33,021
Intangible assets, net	$ 108,321	$ 124,777

Commitments and Contingencies - Contractual Obligations (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Maturity of Debt Obligations
Total long-term debt obligations	$ 154,558
2025	12,058
2026	19,000
2027	23,750
2028	99,750
2029	0
Thereafter	0
Maturity Operating Leases
Total future minimum lease payments	18,538
2025	3,536
2026	3,305
2027	2,706
2028	2,557
2029	2,646
Thereafter	3,788
Maturity Total Contractual Obligations
Contractual obligations	173,096
2025	15,594
2026	22,305
2027	26,456
2028	102,307
2029	2,646
Thereafter	$ 3,788

Leases (Tables)

12 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of Summarized Lease Balances in Consolidated Balance Sheet

The following table summarizes lease balances presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Operating lease right-of-use assets	$	6,681	$	9,656

Operating lease liabilities, current	$	2,652	$	3,463
Operating lease liabilities, long-term	12,789		15,908
Operating lease liabilities	$	15,441	$	19,371

Schedule of Lease Costs and Other Information Related to Leases

For the years ended September 30, 2024 and 2023, total lease costs for our operating leases are as follows (in thousands):


	2024		2023
Operating	$	3,841	$	3,911
Short-term	290		287
Variable	92		95
Sublease income (a)	(269)		(282)
Lease costs	$	3,954	$	4,011

Other information related to our leases is as follows for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Cash paid for amounts included in the measurement of lease liabilities	$	4,572	$	4,468
New lease liabilities, net of new right-of-use-assets	—		120
Other lease information	$	4,572	$	4,588

Schedule of Company's Future Lease Payments

The Company's future minimum lease payments as of September 30, 2024 are as follows (in thousands):


Fiscal year ending:
2025	$	3,536
2026	3,305
2027	2,706
2028	2,557
2029	2,646
Thereafter	3,788
Total future minimum lease payments	18,538
Less: imputed interest	(3,097)
Present value of future minimum lease payments	15,441
Less: current portion of operating lease liabilities	(2,652)
Long-term operating lease liabilities	$	12,789

Provision for Income Taxes - Effective Tax Rate Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Income taxes at the federal statutory rate	$ 1,654	$ 187
State taxes, net	(200)	(536)
Other permanent items	(1,104)	(292)
Income tax expense (benefit)	$ 350	$ (641)

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 270
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482964/270-10-50-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (ee)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 4: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 231
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-9

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 6.I.7)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-8

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-10

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 944
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(9))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477250/944-220-S99-1

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Section 45
-Paragraph 2
-Subparagraph (a)
-SubTopic 20
-Topic 740
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482659/740-20-45-2

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h))
-SubTopic 10
-Topic 235
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

+ Details

Provision for Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Deferred tax assets:
Net operating loss carry forwards, net	$ 1,903	$ 855
Stock based compensation	732	708
Accrued compensation	2,204	2,094
Capitalized transaction costs	532	973
Right-of-use	1,682	1,669
Interest limitation	6,313	2,601
Total deferred tax assets	13,366	8,900
Less: valuation allowance	(1,894)	(847)
Total deferred tax assets, net	11,472	8,053
Deferred tax liabilities:
Depreciation on fixed assets	(402)	(418)
Amortization on identified intangibles and goodwill	(4,364)	(4,050)
Accrued expenses	(461)	(515)
Total deferred tax liabilities	(5,227)	(4,983)
Net deferred tax assets	$ 6,245	$ 3,070

Supporting Financial Information - Equipment and Improvements, net (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Furniture and equipment	$ 1,832	$ 1,790
Computer equipment and software	7,273	6,479
Leasehold improvements	1,614	1,614
Total equipment and improvements	10,719	9,883
Less: accumulated depreciation and amortization	(8,889)	(8,293)
Equipment and improvements, net	1,830	1,590
Depreciation	$ 600	$ 800

Income Taxes (Tables)

12 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Schedule of Significant Components of the Expense From Continuing Operations

The significant components of provision for income taxes from continuing operations are summarized as follows for the years ending September 30, 2024 and 2023 (in thousands):


	2024		2023
Current expense	$	3,525	$	3,823
Deferred expense	(3,175)		(4,464)
Income tax expense (benefit)	$	350	$	(641)

Schedule of Significant Differences Between the Income Taxes at Federal Statutory Rate and Effective Tax Rate


	2024		2023
Income taxes at the federal statutory rate	$	1,654	$	187
State taxes, net	(200)		(536)
Other permanent items	(1,104)		(292)
Income tax expense (benefit)	$	350	$	(641)

Schedule of Deferred Tax Assets and Liabilities

An analysis of the Company's deferred tax assets and liabilities at September 30, 2024 and 2023 is as follows (in thousands):


	2024		2023
Deferred tax assets:
Net operating loss carry forwards, net	$	1,903	$	855
Stock based compensation	732		708
Accrued compensation	2,204		2,094
Capitalized transaction costs	532		973
Right-of-use	1,682		1,669
Interest limitation	6,313		2,601
Total deferred tax assets	$	13,366	$	8,900
Less: valuation allowance	(1,894)		(847)
Total deferred tax assets, net	$	11,472	$	8,053
Deferred tax liabilities:
Depreciation on fixed assets	(402)		(418)
Amortization on identified intangibles and goodwill	(4,364)		(4,050)
Accrued expenses	(461)		(515)

Total deferred tax liabilities	$	(5,227)	$	(4,983)
Net deferred tax assets	$	6,245	$	3,070

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2024	Sep. 30, 2023
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares (in shares)	40,000	40,000
Common stock, issued shares (in shares)	14,391	13,950
Common stock, shares outstanding (in shares)	14,391	13,950

Supporting Financial Information - Other Current Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Prepaid licenses and other expenses	$ 1,315	$ 1,330
Prepaid insurance and benefits	545	743
Other receivables	906	994
Other current assets	$ 2,766	$ 3,067

Provision for Income Taxes - Components of Income Tax Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Current expense	$ 3,525	$ 3,823
Deferred expense	(3,175)	(4,464)
Income tax expense (benefit)	$ 350	$ (641)

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References

+ Details

Leases - Other Information Related to Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Leases [Abstract]
Cash paid for amounts included in the measurement of lease liabilities	$ 4,572	$ 4,468
New lease liabilities, net of new right-of-use-assets	0	120
Other lease information	$ 4,572	$ 4,588

Revenue Recognition - Contract Balances (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Contract assets	$ 23,945	$ 20,542

Supporting Financial Information - Amortization and Weighted Average Amortization period of Intangible Assets (Details) - USD ($) $ in Millions	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Finite-Lived Intangible Assets [Line Items]
Amortization expense of intangibles	$ 16.5	$ 14.8
Finite-Lived Intangible Assets, Remaining Amortization Period	7 years 4 months 24 days
Customer contracts and related customer relationships
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Remaining Amortization Period	7 years 3 months 18 days
Backlog
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Remaining Amortization Period	7 years 7 months 6 days
Trade names
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Remaining Amortization Period	7 years 8 months 12 days
Covenants-not-to-compete
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Remaining Amortization Period	5 years 6 months

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Supporting Financial Information - Interest Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Interest expense	$ 15,352	$ 14,153
Interest income	(38)	(64)
Amortization of deferred financing costs	1,839	2,182
Interest expense	$ 17,153	$ 16,271

Supporting Financial Information

12 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supporting Financial Information

Accounts receivable

The following table summarizes accounts receivable presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Billed receivables	$	25,904	$	38,577
Contract assets	23,945		20,542

Accounts receivable	$	49,849	$	59,119

Other current assets

The following table summarizes other current assets presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Prepaid licenses and other expenses	$	1,315	$	1,330
Prepaid insurance and benefits	545		743
Other receivables	906		994
Other current assets	$	2,766	$	3,067

Goodwill

The balance of goodwill was $138,161 as of September 30, 2024 and September 30, 2023.

Intangible assets, net

The following table summarizes intangible assets, net presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Intangible assets
Customer contracts and related customer relationships	$	113,622	$	113,622
Backlog	37,249		37,249
Trade names	13,034		13,034
Covenants-not-to-compete	637		637
Total intangible assets	$	164,542	$	164,542
Less accumulated amortization:
Customer contracts and related customer relationships	(41,297)		(29,929)
Backlog	(10,994)		(7,273)
Trade names	(3,488)		(2,185)
Covenants-not-to-compete	(442)		(378)
Total accumulated amortization	$	(56,221)	$	(39,765)
Intangible assets, net	$	108,321	$	124,777

Amortization expense for the years ended September 30, 2024 and 2023 was $16.5 million and $14.8 million, respectively.

As of September 30, 2024, the estimated annual amortization expense is as follows (in thousands):


For the Fiscal Year Ending September 30,
2025	$	16,456
2026	15,722
2027	14,694
2028	14,694
2029	13,734
Thereafter	33,021
Total amortization expense	$	108,321

At September 30, 2024, the weighted-average remaining amortization period in total was 7.4 years years At September 30, 2024, the weighted-average amortization period for customer contracts and related customer relationships, backlog, trade names and covenants-not-to-compete was 7.3 years, 7.6 years, 7.7 years, 5.5 years respectively.

Equipment and improvements, net

The following table summarizes equipment and improvements, net presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Furniture and equipment	$	1,832	$	1,790
Computer equipment and software	7,273		6,479
Leasehold improvements	1,614		1,614
Total equipment and improvements	10,719		9,883
Less: accumulated depreciation and amortization	(8,889)		(8,293)
Equipment and improvements, net	$	1,830	$	1,590

Depreciation expense was $0.6 million and $0.8 million for the years ended September 30, 2024 and 2023, respectively.

Accounts payable and accrued liabilities

The following table summarizes accounts payable and accrued liabilities presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Accounts payable	$	13,421	$	12,603
Accrued benefits	4,519		6,414
Accrued bonus and incentive compensation	3,641		4,719
Accrued workers' compensation insurance	1,528		2,369
Accrued interest	619		1,309
Other accrued expenses	1,562		2,290
Accounts payable and accrued liabilities	$	25,290	$	29,704

Accrued payroll

The following table summarizes accrued payroll presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Accrued leave	$	8,569	$	9,621
Accrued payroll	3,070		2,487
Accrued payroll taxes	981		1,173
Accrued severance	228		513
Accrued payroll	$	12,848	$	13,794

Debt obligations

The following table summarizes debt obligations presented on our consolidated balance sheets at September 30, 2024 and 2023 (in thousands):


	2024		2023
Secured term loan	$	142,500	$	169,813
Secured revolving line of credit	12,058		9,546
Less: unamortized deferred financing costs	(5,184)		(7,024)
Net bank debt obligations	149,374		172,335
Less: current portion of debt obligations, net of deferred financing costs (a)	(12,058)		(17,188)
Long-term portion of debt obligations, net of deferred financing costs	$	137,316	$	155,147

As of September 30, 2024, we have satisfied mandatory principal payments on our secured term loan.

Interest expense

The following table summarizes interest expense presented on our consolidated statements of operations for the years ended September 30, 2024 and 2023 (in thousands):


	2024		2023
Interest expense (a)	$	15,352	$	14,153
Interest income (b)	(38)		(64)
Amortization of deferred financing costs (c)	1,839		2,182
Interest expense	$	17,153	$	16,271

(a): Interest expense on borrowing

(b): Interest earned from customer payments received after the due date.

(c): Amortization of expenses related to secured term loan and secured revolving line of credit.

Earnings Per Share

12 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Earnings Per Share

Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common shares outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method.

Earnings Per Share information is presented in the table below for the years ending September 30, 2024 and 2023 (in thousands except for per share amounts):


	2024		2023
Numerator:
Net income	$	7,397	$	1,461
Denominator:
Denominator for basic net income per share - weighted-average outstanding shares	14,169		13,704
Effect of dilutive securities:
Stock options and restricted stock	236		727
Denominator for diluted net income per share - weighted-average outstanding shares	$	14,405	$	14,431
Net income per share - basic	$	0.52	$	0.11
Net income per share - diluted	$	0.51	$	0.10

Credit Facilities

12 Months Ended

Sep. 30, 2024

Cash and Cash Equivalents [Abstract]

Credit Facilities

A summary of our credit facilities as presented on our consolidated balance sheets as follows (in millions):

September 30, 2024

September 30, 2023

Arrangement

Loan Balance

Interest

Arrangement

Loan Balance

Interest

Secured term loan (a) due December 8, 2027

142.5

SOFR1 + 4.1%

Secured term loan (a) due December 8, 2027

169.8

SOFR1 + 4.1%

Secured revolving line of credit (b) due December 8, 2027

12.1

SOFR1 + 4.1%

Secured revolving line of credit (b) due December 8, 2027

9.5

SOFR1 + 4.1%

1Secured Overnight Financing Rate ("SOFR") as of September 30, 2024 and September 30, 2023 was 5.2% and 5.3%, respectively.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

Leases - Summary of Lease Balances in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Leases [Abstract]
Operating lease right-of-use assets	$ 6,681	$ 9,656
Operating lease liabilities, current	2,652	3,463
Operating lease liabilities - long-term	12,789	15,908
Operating lease liabilities	$ 15,441	$ 19,371

Supporting Financial Information - Goodwill (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Goodwill	$ 138,161	$ 138,161

- Definition

Amount, after accumulated impairment loss, of asset representing future economic benefit arising from other asset acquired in business combination or from joint venture formation or both, that is not individually identified and separately recognized.

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+ Details

Significant Accounting Policies (Policies)	12 Months Ended
Significant Accounting Policies (Policies)	Sep. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of DLH Holdings Corp. and its wholly-owned subsidiaries (together with its subsidiaries, "DLH" or the "Company" and also referred to as "we," "us" and "our"). All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, these statements do not include all of the information and footnotes required by GAAP for complete financial statements.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. The most significant of these estimates and assumptions relate to costs including valuing and determining the amortization periods for long-lived intangible assets, interest rate swaps, stock-based compensation, right-of-use assets and leases liabilities, and loss development on workers' compensation claims. We evaluate these estimates and judgments on an ongoing basis and base our estimates on historical experience, current and expected future outcomes, third-party evaluations, and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. We revise material accounting estimates if changes occur, such as more experience is acquired, additional information is obtained, or there is new information on which an estimate was or can be based. Actual results could differ from those estimates.
Revenue	Revenue The Company's revenues from contracts with customers are derived from offerings that include technology-enabled business process outsourcing, program management solutions, and public health research and analytics, substantially within the U.S. government and its agencies. The Company has various types of contracts including time-and-materials contracts, cost-reimbursable contracts, and firm-fixed-price contracts. We consider a contract with a customer to exist when there is a commitment by both parties (customer and Company), payment terms are determinable, there is commercial substance, and collectability is probably in accordance with Accounting Standards Codification ("ASC") No. 606, "Revenue from Contracts with Customers" ("Topic 606"). We recognize revenue over time when there is a continuous transfer of control to our customer as performance obligations are satisfied. For our U.S. government contracts, this continuous transfer of control to the customer is transferred over time and revenue is recognized based on the extent of progress toward completion of the performance obligation. We consider control to transfer when we have a right to payment. In some instances, the Company commences providing services prior to formal approval to begin work from the customer. The Company considers these factors, the risks associated with commencing work, and legal enforceability in determining whether a contract exists under Topic 606. Contract modification can occur throughout the life of the contract and can affect the transaction price, extend the period of performance, adjust funding, or create new performance obligations. We review each modification to assess the impact of these contract changes to determine if it should be treated as part of the original performance obligation or as a separate contract. Contract modifications impact performance obligations when the modification either creates new or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue and profit cumulatively. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. For service contracts, we satisfy our performance obligations as services are rendered. We use cost-based input and time-based output methods to measure progress based on the contract type. •Time and material - We bill the customer per labor hour and per material, and revenue is recognized in the amount invoiced as the amount corresponds directly to the value of our performance to date. Revenue is recognized to the extent of billable rates times hours delivered plus materials and other reimbursable costs incurred. •Cost reimbursable - We record reimbursable costs as incurred, including an estimated share of the contractual fee earned. •Firm fixed price - We recognize revenue over time using a straight-line measure of progress. Contract costs generally include direct costs such as labor, materials, subcontract costs, and indirect costs identifiable with or allocable to a specific contract. Costs are expensed as incurred and include an estimate of the contractual fees earned. Contract assets - Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms. In part, revenue recognition occurs before we have the right to bill, resulting in contract assets. These contract assets are reported within Accounts receivable, net on our consolidated balance sheets and are invoiced in accordance with payment terms defined in each contract. Period end balances will vary from period to period due to agreed-upon contractual terms. Contract liabilities - Amounts are a result of billings in excess of costs incurred or prepayment for services to be rendered. Disaggregation of revenue from contracts with customers We disaggregate our revenue from contracts with customers by customer, contract type, as well as whether the Company acts as prime contractor or subcontractor. We believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of the Company's cash and cash equivalents, accounts receivable, contract assets, contract liabilities, accrued expenses, and accounts payable approximate fair value due to the short-term nature of these instruments. The fair values of the Company's debt instruments approximate fair value because the underlying interest rates approximate market rates that the Company could obtain for similar instruments at the balance sheet dates.
Long Lived Assets	Long-lived Assets Our long-lived assets include equipment and improvements, intangible assets, right-of-use assets, and goodwill. The Company reviews its long-lived assets for possible impairment or loss of value at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. Equipment and improvements are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the estimated useful asset lives (3 to 7 years) and the shorter of the initial lease term or estimated useful life for leasehold improvements. Maintenance and repair costs are expensed as incurred. Intangible assets (other than goodwill) are originally recorded at fair value and are amortized on a straight-line basis over their estimated useful lives of 10 years. Right-of-use assets are measured at the present value of future minimum lease payments, including all probable renewals, plus lease payments made to the lessor before or at lease commencement and indirect costs paid, less incentives received. Our right-of-use assets include long-term leases for facilities and equipment and are amortized over their respective lease terms.
Leases Liabilities	Lease Liabilities The Company has leases for facilities and office equipment. Our lease liabilities are recognized as the present value of the future minimum lease payments over the lease term. Our lease payments consist of fixed and in-substance fixed amounts attributable to the use of the underlying asset over the lease term. Variable lease payments that do not depend on an index rate or are not in-substance fixed payments are excluded in the measurement of right-of-use assets and lease liabilities and are expensed in the period incurred. The incremental borrowing rate on our secured term loan is used in determining the present value of future minimum lease payments. Some of our lease agreements include options to extend the lease term or terminate the lease. These options are accounted for in our right-of-use assets and lease liabilities when it is reasonably certain that the Company will extend the lease term or terminate the lease. The Company does not have any finance leases.
Goodwill	Goodwill The Company performs impairment evaluation at least annually and between annual tests whenever there is an indication of impairment. We performed a qualitative assessment of factors to determine whether it was necessary to perform the goodwill impairment test. Based on the results of the work performed, the Company has concluded that no impairment loss was warranted at September 30, 2024, as no change in business conditions occurred which would have a material adverse effect on the valuation of goodwill. Notwithstanding this evaluation, factors including non-renewal of a major contract or other substantial changes in business conditions could have a material adverse effect on the valuation of goodwill in future periods and the resulting charge could be material to future periods’ results of operations.
Income Taxes	Income Taxes The Company accounts for income taxes in accordance with the asset and liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the consolidated balance sheet when it is determined that it is more likely than not that the asset will be realized. This guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax assets will not be realized. We account for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon the technical merits, it is more-likely-than-not that the position will be sustained upon examination.
Share-based Compensation	Stock-based Compensation The Company uses the fair value-based method for stock-based equity compensation. Options issued are designated as either an incentive stock or a non-statutory stock option. No option may be granted with a term of more than 10 years from the date of grant. Option awards may depend on the achievement of certain performance measures determined by the Compensation Committee of our Board. Shares issued upon option exercise are newly issued common shares. All awards to employees and non-employees are recorded at fair value on the date of the grant and expensed over the period of vesting. The Company uses the Monte Carlo method to estimate the fair value of each stock option at the date of grant. Any consideration paid by the option holders to purchase shares is credited to capital stock. Stock-based Compensation expense for the portion of equity awards for which the requisite service has not been rendered is recognized as the requisite service is rendered. The stock-based compensation expense for that portion of awards has been based on the grant-date fair value of those awards as calculated for recognition purposes under applicable guidance. For options that vest based on the Company’s common stock achieving and maintaining defined market prices, the Company values the awards with a Monte Carlo method that utilizes various probability factors and other criterion in establishing fair value of the grant. The related stock-based compensation expense is recognized over the service period. Stock based compensation is reliant on continued employment with the Company. These arrangements are forfeited upon employee separation and accounted for as they occur.
Cash	Cash We consider all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation up to $250,000. Deposits held with financial institutions may exceed the $250,000 limit.
Accounts Receivable	Accounts Receivable Receivables include amounts billed and currently due from customers where the right to consideration is unconditional and amounts unbilled. Both billed and unbilled amounts are non-interest bearing, unsecured, and recognized at an estimated realizable value that includes costs and fees, and are generally expected to be billed and received within a single year. We evaluate our receivables for expected credit losses on a quarterly basis and determine whether an allowance for expected credit losses is appropriate based on specific collection issues.
Earnings per Share	Earnings Per Share Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of common stock outstanding and restricted stock grants that vested or are likely to vest during the period. Diluted earnings per share is calculated by dividing income available to common shareholders by the weighted average number of basic common shares outstanding, adjusted to reflect potentially dilutive securities. Diluted earnings per share is calculated using the treasury stock method.
Treasury Stock and Preferred Stock	Treasury Stock The Company periodically purchases its own common stock that is traded on public markets as part of announced stock repurchase programs. The repurchased common stock is classified as treasury stock on the consolidated balance sheets and held at cost. As of September 30, 2024 and 2023, the Company did not hold any treasury stock. Preferred Stock Our certificate of incorporation authorizes the issuance of "blank check" preferred stock with such designations, rights and preferences as may be determined from time to time by our board of directors up to an aggregate of 5,000,000 shares of preferred stock. As of September 30, 2024 and 2023, the Company has not issued any preferred stock.
Interest Rate Swap	Interest Rate Swap The Company uses derivative financial instruments to manage interest rate risk associated with its variable debt. The Company's objective in using these interest rate derivatives is to manage its exposure to interest rate movements and reduce volatility of interest expense. The gains and losses due to changes in the fair value of the interest rate swap agreements completely offset changes in the fair value of the hedged portion of the underlying debt. Offsetting changes in fair value of both the interest rate swaps and the hedged portion of the underlying debt are recognized in interest expense in the consolidated statements of operations. The Company does not hold or issue any derivative instruments for trading or speculative purposes.
Risks & Uncertainties	Risks and Uncertainties Management evaluates the impact of global markets and economic factors on our industry and the potential for adverse effects on the Company's consolidated financial position and its operations. As of September 30, 2024, there was no indication of any global or economic impacts to our industry.
New Accounting Pronouncements	New Accounting Pronouncements In November 2023, Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07 "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures" which provides guidance intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, and each reported measure of segment profit or loss. The ASU requires that a public entity that has a single reportable segment provide all the disclosures required by the amendments in this ASU and all existing segment disclosures in Topic 280. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024. We are currently evaluating the impacts of the single reportable segment disclosures. In December 2023, FASB issued ASU 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" which provides guidance on the requirements such as the requirement that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. DLH is a public company that reports income tax disclosures and therefore this ASU applies to the Company. ASU 2023-09 is effective for public business entities for fiscal years beginning after Dec. 15, 2024. We are currently evaluating the impacts of the improvements to income tax disclosure. In March 2024, FASB issued ASU No. 2024-01, "Scope Application of Profits Interest and Similar Awards". The ASU clarifies how an entity determines whether a profits interest or similar award is (1) within the scope of ASC 718 or (2) not a share-based payment arrangement and therefore within the scope of other guidance. The guidance in ASU 2024-01 applies to all entities that issue profits interest awards as compensation to employees or non-employees in exchange for goods or services. We are currently evaluating the impacts of the improvements to our disclosure. In March 2024, the Securities and Exchange Commission ("SEC") has released a final rule that requires registrants to provide comprehensive climate-related disclosures in their annual reports and registration statements, including those for IPOs, beginning with annual reports for the year ending December 31, 2027, for smaller reporting companies ("SRC"). Registrants must disclose climate-related financial metrics and impacts on their financial estimates and assumptions in a footnote to the audited financial statements. The disclosures will also need to be addressed as part of management’s internal control over financial reporting ("ICFR") and will be subject to the financial statement and ICFR audit (if applicable) of an independent registered public accounting firm. We are currently evaluating the impacts of the improvements to our disclosure.

Employee Benefit Plans (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plans (Details) - USD ($) $ in Millions	Sep. 30, 2024	Sep. 30, 2023
Retirement Benefits [Abstract]
Defined contribution plan, recorded expense	$ 3.4	$ 2.6
Defined contribution plan, matching contributions period	4 years

Basis of Presentation and Principles of Consolidation	12 Months Ended
Basis of Presentation and Principles of Consolidation	Sep. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of DLH Holdings Corp. and its wholly-owned subsidiaries (together with its subsidiaries, "DLH" or the "Company" and also referred to as "we," "us" and "our"). All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, these statements do not include all of the information and footnotes required by GAAP for complete financial statements.