New York, NY—December 13, 2023—The Fedcap Group reported its operational and financial results for fiscal year 2023 ended September 30, 2023.
“We are pleased to report that fiscal 2023 was a year of impressive contract and program performance for The Fedcap Group in which we further strengthened our financial position and laid the groundwork for substantial domestic and international growth in the future. While continuing to achieve positive outcomes domestically, we expanded our global footprint in FY2023, introducing new initiatives in Canada and the United Kingdom, while integrating successful models internationally, demonstrating our dedication to scalable best practices on a global scale,” said Christine McMahon, President and CEO of The Fedcap Group. “In FY2023, we outpaced our peers in graduation rates, set a record for number of job placements in our organization’s history, secured families more than a half a billion dollars in benefits using our Single Stop screening platform, and launched new innovations, like virtual reality technology and a CDFI that will build generational wealth in historically marginalized communities. We achieved this while navigating a challenging economic environment in which our financial results demonstrated the benefits of our diversified revenue base and long-term data-driven strategic planning.”
The Fedcap Group provides a diversified array of services and interventions to spring individuals from the social safety net and put them on a path to economic well-being. The Fedcap Group’s work is organized through four practice areas—education, workforce development, health, and economic development—and driven through 23 nonprofit subsidiaries in the United States, Canada, and the United Kingdom. In FY2023, The Fedcap Group served nearly 230,000 people, including those screened for state and federal benefits through our Single Stop program.
Throughout FY2023, the Education Practice remained dedicated to strengthening and broadening its cradle-to-career initiative, commencing with early childhood programs, and extending through post-secondary education. During FY2023, The Fedcap Group successfully educated 2,330 individuals—an annual increase of 4.5%—across four states, achieving an overall completion rate of 77%.
Highlights from FY2023 included a substantial expansion within childhood development programs, notably marked by the launch of a new Easterseals Pre-K program in Austin, Texas, and the completion of a state-of-the-art facility in Port Jervis, NY, which significantly increased its capacity.
In addition, Apex Technical School, The Fedcap Group’s postsecondary trade program, opened a modern new facility in Queens, NY. In an era of declining post-secondary enrollment, Apex is bucking national trends with a 23% year-over-year enrollment increase. With an impressive completion rate of 76%–far surpassing the national average of 43% for peer institution community colleges, and its outstanding 75% placement rate into well-paying, sustainable trade jobs, Apex has reinforced its position in higher education.
The Workforce Development Practice continued its exceptional performance throughout FY2023. Notably, Fedcap achieved a milestone by placing 25,600 individuals into jobs, marking a noteworthy 7% year-over-year increase and an impressive 184% growth since 2020. FY2023 also reinforced Fedcap’s track record of robust job retention rates, with 90% of individuals placed retaining their positions for at least 30 days, 82% for 90 days, and 78% for 180 days.
In FY2023, Fedcap introduced FedcapVR—an innovative end-to-end solutions provider specializing in creating fully immersive virtual reality simulations. These simulations are seamlessly integrated into the organization’s education and workforce programs, specifically tailored for industries such as construction, welding, and green energy technologies. FedcapVR is instrumental in assisting Fedcap clients with job exploration and successful completion of their training, thereby enhancing their prospects in the job market.
The Fedcap Group’s Health Practice continues to grow on the strength of the organization’s nation-leading Single Stop case management and benefits program. During FY2023, Single Stop screened 55,870 individuals for federal and state benefits, and households on average received $17,600 in benefits—or $504.7 million total value of benefits overall. Single Stop also included new programs to screen, including the Low-Income Home Energy Assistance Program—LIHEAP— and entered new states including California and Illinois.
The Fedcap Group continues to show strong results in health and wellness during FY2023, including providing more than 42,000 individuals wellness services in health and behavioral health treatment–enabling individuals to stabilize and obtain and retain employment.
During FY2023, The Fedcap Group directly employed 1,060 individuals in its commercial businesses—the majority of whom have disabilities or other employment barriers, enjoying an average annual salary of $42,550. This figure stands notably higher, surpassing the average annual salary based on a minimum wage of $15.00 per hour by over 30%.
Moreover, there has been a remarkable increase in retirement assets for Fedcap’s direct client service workers, climbing from $8.4 million in 2010 to an impressive $124.4 million in 2023. This substantial growth demonstrates our steadfast commitment not only to providing sustainable wages, but also to fostering wealth and financial stability among our diverse workforce.
In FY2023, The Fedcap Group launched a CDFI to help barriered communities achieve economic well-being through direct financial investment and equity opportunities. Utilizing a $125K technical assistance grant from the U.S. Treasury, The Fedcap Group is currently developing the CDFI structure and set a goal of raising $6 million over the next three years to be used for home ownership, lending for low-cost equity investments, technical assistance, small business loans, and project-based investments.
Our global presence continues to expand, particularly in Canada and the United Kingdom. In FY2023, we introduced new employment services in Niagara Falls, Canada, and within the Hamilton-Niagara region, Fedcap not only surpassed job entry performance deliverables by over 100% but also consistently exceeded various other performance targets, meeting or surpassing contractual obligations.
Additionally, The Fedcap Group significantly enhanced its domestic and international program integration, enabling the organization to implement and scale best practices globally. In FY2023, our U.K.-based company successfully adopted The Fedcap Group’s established clubhouse model—a 30-year-old program based in New York City and New Hampshire. Clubhouses aid, train, and build community for individuals dealing with serious mental illness. The two newly established clubhouse models in the U.K.—Riverside Clubhouse in Staines, South Central England, and the Hive Clubhouse in Burnley, Northwest England—are already showing notable successes. This year, 68% of members experienced improvements according to the Work and Social Adjustment Scale, while 60% reported enhanced well-being through the Warwick-Edinburgh Mental Wellbeing Scale.
Similarly, our U.S.-based program in Maine has effectively adopted the U.K.’s Restart Program, designed to aid long-term unemployed individuals in transitioning back to work. The official launch of this program is scheduled for 2024.
We successfully navigated the economic challenges of FY2023, including high inflation, government budget cuts, and regulatory uncertainty that resulted in the elimination of several contracts and various project delays. Fedcap Group’s revenue for FY2023 reached $363.4 million, slightly ahead of the $361.7 million reported in FY2022, and based on current visibility, we expect to return to mid-single-digit revenue growth in fiscal 2024. The Fedcap Group ended fiscal 2023 with a robust business development pipeline of almost $400 million and an impressive win rate of over 95% on recompetes.
At fiscal 2023 year-end, The Fedcap Group had $34.9 million in cash and investments, total assets of $358.3 million, and long-term debt of $249.1 million. Notably, The Fedcap Group’s net assets increased to $52 million, indicating an impressive 38% increase from FY2019.
In addition to continued global expansion of best practices and programs to achieve economic well-being, The Fedcap Group will focus on its pledge to sustainability. Fedcap has committed to adhering to the United Nations construct on sustainable development and is implementing clear positive programs to strengthen Environmental, Social, and Governance practices for the 23 organizations under The Fedcap Group.
For nearly ninety years, The Fedcap Group has developed scalable, innovative, and potentially disruptive solutions to some of society’s most pressing needs. The Fedcap Group provides educational services to every age group, vocational training, and job attainment in high-growth industries, as well as support services such as behavioral health services—all targeted to helping people achieve long-term self-sufficiency. The Fedcap Group also invests its time and resources in broader system change—working in partnership with federal, state, and local government to improve the way services are designed, funded, and delivered.
Jim Malatras, 212-727-4200, (JMalatras@fedcap.org)