Question-and-Answer Session
Operator
(Operator Instructions) We’ll take our first question from Michael S. Lewis – BB&T Capital Markets.
Michael S. Lewis – BB&T Capital Markets
Free cash flow was excellent in the first quarter. In fact I think it’s the highest Q1 free cash flow you’ve posted since being a publicly traded company. Now with that said, how would you project the free cash flow moving through the remainder of the year and do you think that we will see a conversion as percent of net income in excess of 1.25 or 1.3 times?
Judith L. Bjornaas
On an ongoing basis?
Michael S. Lewis – BB&T Capital Markets
I’m talking about the end of the year.
Judith L. Bjornaas
At the end of the year, yes, it should be above one.
Michael S. Lewis – BB&T Capital Markets
Above one or, I was talking 1.25 to 1.3.
Judith L. Bjornaas
Yes, I think that’s probably about right because I think for the rest of the year it’ll be between 80% to 100% of net income.
Michael S. Lewis – BB&T Capital Markets
Just another question with regard to contracting, Terry you had talked about the staffing growth already but I was wondering if we could a more detailed update on the NETCOM and TEAS contracts?
Terry W. Glasgow
Michael, the NETCOM is pretty well staffed up and at it’s full run rate right now. There’s obviously opportunity for growth there but then, it’s pretty much where we thought it would be.
As I mentioned on the last conference call the TEAS IA BRAC in particular is one where we had some early staffing as we constituted some fly away teams to go out and address some of the initial requirements but I also said that we expected most of the staffing to come later this year, the third and probably fourth quarter, the urgency of BRAC becomes more apparent and as more and more dollars flow that way.
It’s moving ahead very nicely. It’s on track but that was one of the things we said, that we had to wait and see how the funding actually flowed out.
Michael S. Lewis – BB&T Capital Markets
Just a final question, with regard to your Army exposure, have you experienced any changes in procurement trends? Has there been any slow downs that you’ve seen specifically from the Army over the past two to three months?
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