But certainly, the significant deal that everybody is aware of as it sits on our portfolio is the Vanguard, the Department of State Vanguard deal that is being transitioned to evolve. And so that is something that everybody is aware of. It’s a significant part of our portfolio. And we’re going through that process. It will probably become clearer sometime into next year as to how all that plays out. As a reminder, they are taking different pockets of work inside of NASA and putting it into multiple award streams. And so we’re looking at — that’s certainly what makes the most sense for us. But — and we expect to win our fair share of that work. In the meantime, I just want to take a shout out to the team that’s delivering, because it’s always a distraction when there’s a lot of procurement activity.
But this team is laser-focused on delivering to the mission delivering to the Department of State and ensuring that we don’t miss a beat and continue to innovate and accelerate our position supporting this customer. Prabu, do you want to add some color?
Prabu Natarajan: Thank you, Nazzic. That was perfect. David, here’s what I would add. We’re growing this business at the midpoint of our updated guide about 4.5%. And as we noted in the prepared remarks, that is the highest growth rate we’ve posted organically since the separation. So in spite of the headwind from the recompete loss, Oms notably, which we’re assuming we’ll cycle out of the portfolio beginning in Q4, we are delivering approximately, let’s call it, mid-single-digit growth rate. Since the last quarter, we’ve also won some new work, which will start to backfill the loss that we have, but the timing of the Oms project program exiting the portfolio and the timing of the new work sliding into the portfolio is what impacts the cadence of the revenue growth but recognize that we are laser committed to delivering consistent growth rate consistent with the 2% to 4% that we outlined at Investor Day, but recognize that Oms is probably the biggest one worth calling out for the year.
And if you really think about the performance of this business, you would expect about a 1% to 2% growth rate impact on an annual basis from recompete losses, that’s just the nature of the business, I think, and we are looking at something a little bit higher than that this year, but recognize 4.5%, 5% growth is just really solid growth and right in line with where the peer set is, and we’ve got our work cut out for us for next year, and that’s what the team is committed to doing.
David Strauss: That was great color. Thanks. And then on cash, I wanted to get an update on working capital and what you see there, Prabu, I think year-to-date, it’s been a slight drag, kind of what’s embedded for the second-half of the year and just an update kind of on the working capital tailwind that you have embedded your fiscal ’26? Thanks.
Prabu Natarajan: Appreciate the question. First-half of the year was actually really good performance and relative to the first-half of last year. And the momentum that we began to see in the business at Q4 of last year. And as a reminder, we collected more than $2 billion of cash in a single quarter or Q4 of last year. So that momentum has actually continued into the first half of the year. Historically, if you think maybe three to five years back, the cadence of collections tends to be about, let’s call it, 45% in H1 and 55% in H2. Last year was actually flipped. We actually had more to collect — a lot more to collect in H2 than H1. And this year is actually more normalized relative to the historical pattern here. So we actually have good visibility into getting to the midpoint of our guide range as we sit there now, but recognize that our guidance range is $20 million, which happens to be about a day’s worth of DSO, really big picture.
So we’re dialing the forecast down to within a day of what our full-year cash performance is going to be. But I’m really just pleased with where we are for the first-half of the year. It is ahead of where we expected to be from an internal plan perspective, but recognize we’ve got six more months of collections and disbursements we have to worry about. Really big picture on FY ’25 and ’26. The performance we’ve had in the first-half of the year gives us continued comfort that we can get to the targets that we laid out at Investor Day, approximately $10 of free cash flow per share in FY ’25 and $11 in FY ’26, recognizing that we are addressing the headwinds from the Section 174 that’s slowly starting to burn off in the system here. But obviously, from a working capital perspective, really big picture, I continue to see good level of opportunity, we’ve dialed the process down where we could see working capital accretion and dilution, if you will, at the individual program level and we have program managers taking responsibility for working capital.
That’s the level of traction we wanted to see two years ago, and that’s exactly what we’re seeing right now. So I continue to see that and capital deployment as a multiyear opportunity as we sit here in the second half of FY ’24.
David Strauss: Perfect. Thanks very much.
Prabu Natarajan: Sure.
Nazzic Keene: Thanks.
Operator: Your next question will come from the line of Matt Akers with Wells Fargo. Please go ahead.
Matt Akers: Hey, good morning. Thanks for the question, and Nazzic good luck [Indiscernible].
Nazzic Keene: Thanks, Matt.
Matt Akers: I just wanted to follow-up on the commentary on sort of the bookings delays and you mentioned like year-to-date, it’s sort of been a little bit slower than you thought, and it sounds like some of in the back half, maybe to shift into 2025. And what do you think is driving that, I guess? Are customers kind of more cautious given the budget environment? Is it just kind of a few large award that lift? Is it protests — just kind of curious what you think is kind of driving that dynamic?
Nazzic Keene: Yes, I Matt couple of comments, and then I’ll let Prabu provide some detail. On the book-to-bill, as Prabu mentioned in the prepared remarks, it certainly was below where we had planned for it to be. And I think if it was where we planned, we would be having a very different call here today and things would look different. But I wanted to give you my little bit of context on that. So book-to-bill, as we all know, is an indicator, but not the indicator for growth. And there are so many components that go into it. Prabu touched on one of them, which is how anybody books their IDIQ, single award or multi-award going into book-to-bill period of performance, that can have an impact as well, how much of the bookings is new business versus recompete business.
