2022 Q3 REPORT PTS NEWSLETTER

Ten months into 2022 and it’s been a year of historical events, each of which had a lasting impact on the Government Contracting industry. Ukraine went on the offensive last month pushing Russia to the breaking point. NATO and the Baltic states continue supplying weapons and training for Ukrainian forces. Only time will tell the level of involvement for contractors post-conflict. Afghanistan and the Middle East continue to face repercussions from America’s sudden withdrawal. The Taliban reneged on all their promises regarding women’s rights and heavily curtailed their involvement with society. Iran is in an uproar following a woman’s death over not wearing a hijab. Escalating protests have raged in the country for almost two weeks. China and Taiwan remain a focal point of American politicians as the Speaker of the House of Representatives recently visited the island nation and President Biden announced America would defend Taiwan if China invaded. Covid-19 fades deeper in the background, with President Biden stating the Pandemic is over. Job seekers hold all the cards in a post-pandemic work environment as companies seek to find the balance between in-person, hybrid, and remote work. These evolving events and trends bring new challenges and opportunities to Government Contractors. INDUSTRY TRENDS UKRAINE - continues to defy the odds and the experts. They’ve gone from a defensive posture incrementally ceding ground to an offensive push with unparallel success. In the middle of September, Ukraine made immense gains around Kharkiv and Northern Donetsk Oblasts. They pushed Russia out of Izyum after six months of occupation. The city served as a base of operations for regional deployments. On liberating these regions, Ukraine reported mass graves and torture sites. United Nations investigators responded to these atrocities and confirmed the Ukrainian governments earlier pronouncements of war crimes. Russia recently announced partial mobilization seeking to bolster its forces in Ukraine and on the border. Ukrainian President Zelensky has stated the war will not end until all Ukrainian territory is free from Russian occupation including Crimea. Ukraine’s recent success brings optimism and concern as Putin is now being pushed into a corner with limited options. The United States, NATO, and other European nations continue to provide lethal and non-lethal aid. Contracting opportunities abound in Eastern Europe and Poland for those seeking to support Ukraine. Talks are ongoing regarding the contracting landscape for reconstruction once the conflict pauses or ends. According to a panel of EUCOM leadership, Europe will lead the reconstruction efforts with the US in a supporting role.

Industry Trends

AFGHANISTAN - remains a critical area of need with little opportunity to directly support the country. With the Taliban in control, determining how to deliver aid without it going straight into the regime’s hands has become extremely problematic. The United States is looking at options to circumvent the Taliban by providing direct in-kind donations to support immediate humanitarian needs. In the meantime, Afghan funds held by the United States and world banks remain frozen. The United States recently orchestrated a drone strike on the highest-ranking member of Al Qaeda after the intel community found him living inside Kabul. His presence there undermines the credibility of the Taliban’s anti-terrorism stance. While countries struggle to find the political will and means to support Afghans, countless veteran and volunteer groups are working behind the scenes. The Global Friends of Afghanistan held their inaugural summit at Georgetown University in July. Save Our Allies, Special Operations Association of America, and the Independence Fund were among several organizations that sponsored the event. It remains to be seen when contractors will have opportunities to support humanitarian efforts in country.

IRAQ - maintains a large presence of contractors to support the United States operations against the Islamic State of Iraq and Syria (ISIS) and further national security objectives. According to GovWin IQ OCONUS Prime Spending report, U.S. support is designed to build capacity of the Iraqi Security Forces, conduct Central Command activities, and replenish and replace munitions and equipment. These stabilization efforts seek to combat terrorism, political instability, and Iranian backed rebels. July of 2022 marked the largest period in Iraq without a government since an election. In June 2022, the largest Shia political bloc in the Iraqi parliament, led by cleric Al-Sadr, resigned from the parliament. In late August, Al- Sadr announced his withdrawal from political life. Violent clashes between his supporters, Iran-aligned militias, and security forces followed his action. The risk of further confrontation remains high. Any new Government also faces the challenge of addressing Iraq’s economic crisis, the risk of terrorism, and negotiating tensions with regional powers.

COVID-19

COVID-19 continues to inch further into the background. As President Biden declared an end to the pandemic, his Covid team was quick to add several caveats. Covid will likely remain a part of personal decisions regarding travel, employment, and social life. The U.S. Government still requires its employees to receive a vaccination. This requirement will continue to complicate hiring practices in the GovCon space.

GREAT TALENT MIGRATION

ebbs and flows as the pandemic hands it’s press credentials over to inflation and an energy crisis. Job seekers still hold the leverage when it comes to negotiations. They’ve sat still for the pandemic hoping to maintain stability. Now that we’re transitioning into an endemic phase, many folks are looking to make a change. Candidates favor a hybrid or entirely remote workplace over working in person. Companies must temper their expectations of how many people they’ll be able to pull into an office. The Central Intelligence Agency and other government departments are making workforce generation a top priority. If the public or private sector wish to retain the best talent, they’ll need to work around the in-person requirements. These workarounds could move to a hybrid model or increasing compensation to a level that offsets the in-person demands.

MERGERS & ACQUISITIONS

Booz Allen Hamilton recently announced the launch of Booz Allen Ventures with an initial fund of $100 million. The venture capital initiative will support artificial intelligence, machine learning, cyber security, defense tech, and many other tech-related startups. Vice President Brian MacCarthy will lead up the new venture. DEEP ISOLATION and Amentum recently signed an agreement to partner on commercial nuclear waste disposal. The partnership will initially focus on Europe and the Pacific to handle geologic disposal of spent fuel and high-level waste worth more than $30 billion. Canada-based engineering services provider WSP Global has wrapped up its acquisition of John Wood Group’s environment and infrastructure business for approximately $1.81 billion as part of a push to expand its environmental service offerings to clients. ManTech International recently announced the company’s sale to global investment firm Carlyle has been completed. The all-cash acquisition represents a total enterprise value of roughly $4.2 billion. Robert W. Baird & Co. acted as the financial advisor for Carlyle in the transaction. V2X reported $498 million in sales for the second quarter, up 6 percent from the prior-year period. The updated quarterly earnings reflect contributions of Vectrus prior to the completion of its merger with The Vertex Company.

MAJOR PROGRAM UPDATES

LOGCAP V - PTS continues to monitor opportunities for LOGCAP V. Our team members have extensive experience supporting LOGCAP operations. As the contract matures, the government is showing a willingness to compete out new work within the COCOM among the four primes on LCV. Fluor won the first competitive task order to take over support for Manda Bay, Kenya which is now rolled into Fluor’s AFRICOM support. On September 1st, LOGCAP Executive Officer John Dengler attended a worksite visit and briefing at the Army Prepositioned Stocks-2 in Mannheim, Germany. This fall, the Army Field Support Battalion based in Mannheim will re-designate to Poland to take charge of the new APS-2 worksite. It includes 650,000 square feet of humidity-controlled warehouse space, a vehicle maintenance facility, several support facilities, and 58,000 square feet of earth-covered munitions storage. The new APS-2 site represents the most significant NATO investment in the last 30 years. It will allow the rapid deployment of an entire armored brigade combat team. During a LOGCAP executive-level summit held at Rock Island, Illinois, earlier this year, Gen. Ed Daly emphasized that LOGCAP remains the Army and multiple joint partners’ contracted capability of choice for emergent and contingency operations.

DiPSS - We are still waiting for the release of the Baghdad Embassy Compound Operation and Maintenance Support award. The incumbent contract held by PAE holds ceiling value of $2 Billion, including all options. We assess the continuing contract will maintain a similar value. PTS has supported DoS/OBO talent requirements for years and has cleared leadership and technical talent for all Embassy programs.

AFCAP - PTS has a roster of cleared AFCAP talent with engineers, logistics, and BOSS. With the recompete phase involving over fifty Task Orders under the new generation of the contract finished most of the incumbents retained their program. There have been a few notable changes with PAE-Pereni PAE winning Qatar engineering task order and IAP/RMS winning DFAC at Al Udied. USAID - PTS closely monitors USAID funding, contracts, and implementation, to serve our customers. We leverage our experienced team with innovative technology and best practices to provide our clients with the actionable intelligence needed to succeed. PTS is currently monitoring USAID’s response to the conflict in Ukraine, Covid-19, and the Next Generation Global Health Supply Chain. On August 8th, USAID announced an additional $4.5 billion direct budgetary support to Ukraine. The total amount of financial aid will now amount to $8.5 billion. These funds support lifesaving humanitarian assistance, critical infrastructure development, aid to small businesses and agriculture, documentation of human rights violations, and the continued functioning of local, regional, and national government levels. USAID continues to administer Covid-19 testing and vaccines to middle and low-income countries. The U.S. Ambassador to the United Nations recently announced the “test-to-treat programming” for Bangladesh, Botswana, Côte d’Ivoire, El Salvador, Ghana, Lesotho, Malawi, Mozambique, Rwanda, and Senegal. Test- to-treat programming prepares health systems to make rapid COVID-19 testing broadly accessible for people upon developing COVID-19 symptoms. On September 1st, the GHSC Program, led by Chemonics International Inc. released a Request for Quotation (RFQ) to solicit quotations from eligible vendors for ad hoc purchases of Section 508 compliance services.

DLA - Before founding PTS, Jake Frazer served as the Chief Operating Officer for one of the multi- commodity TLS contractors with DLA. He brought over a decade of DLA experience to the PTS talent base. The acquisition cycle times for the OCONUS Prime Vendor programs continue to be delayed due to extended source selection and subsequent protests. Last May, DLA awarded new MRO contracts in the Pacific region for Japan (Noble) and Korea (PAE). SPV Korea is re-awarded to USFI; SPV Hawaii is in live RFP stage; and SPV Japan, Singapore, Philippines, Diego Garcia, and Australia are in live RFP stage since June 2021. On the CONUS MRO solicitations, DLA region contracts are expected to be awarded in Q4 of 2022 and Q1 of 2023.

GLOBALCAP - The Department of State’s Bureau of African Affairs, Office of Regional Peace, and Security (AF/RPS), Bureau of Political-Military Affairs, and Office of Global Programs and Initiatives (PM/GPI) have yet to release the GLOBAL CAP award. Acquisition Management anticipates entering a multiple awards Indefinite Delivery Indefinite Quantity contract with an estimated maximum of $500 Million per year for up to 10 years for professional support services, construction, and equipment. DoS anticipates an award in the last quarter of FY2023. PTS has a strong record supporting multiple primes on AFRICAP, GPOI, and GDRP, providing access to a large pool of relevant talent for future bidding.

DoS Medical - The Global Medical Support System remains in the pre-RFP status. It holds an anticipated solicitation date of October 2022 and an award date of February 2023. The industry is still waiting to determine if SOS International (SOSi) will retain its February Medical Support Services Iraq award. SOSi has yet to receive an update on its stop work order from March. PTS recently deepened its work in the medical field, acquiring Chief Medical Officers, Senior Vice Presidents for Global Health Supply Chain, and Program Manager for Covid Testing.

PTS UPDATE

We are continuing to expand and diversify our capabilities and customers.

NATO/NSPA Consulting - PTS offers customers consulting services for North Atlantic Treaty Organization/NATO Support and Procurement Agency opportunities. Jim Shields handles consulting services, including support assessment, penetration, and bid development. Shields holds extensive experience working with the United States Navy and NATO. After thirty years with the USN, Shields spent five years in Luxembourg as a Program Manager and Deputy Director, focusing on Logistics. The PTS team tracks intelligence and analysis relevant to NATO, seeking to serve our customers best. Our team, spread across twelve countries, attends events, meetings, and networking sessions.

BCK Partnership - Precision Talent Solutions has partnered with BCK Consulting and is currently using predictive analytics reporting for our current clients’ candidates. Our clients appreciate an alternative way of making decisions on talent.

Industry related events - PTS is a proud member of the International Stability Operations Association with Jake Frazer, PTS CoFounder and President, serving on the board. Our team recently attended ISOA’s Warsaw Conference focusing on Ukraine. We spent the week meeting with clients and candidates while receiving industry updates from relevant stakeholders in government and the private sector. PTS hosted over fifty clients and friends for VIP dinner at the Red Hog in Warsaw. Jake sought to bring industry leaders together for an informal gathering following the Stuttgart conference, and we had over 30 folks in attendance. Wills Hay recently represented PTS in Tallinn, Estonia, where he heard from an excellent run of speakers, including Ukrainian medic-turned-MP Oleksii Goncharenko. At night, Wills helped organize a dinner with Krista Mulenok, the Secretary General of the Estonian Atlantic Treaty Association, and her colleagues. Our team attended the Association of the United States Army – AUSA Annual Meeting. Wills Hay and Michael Stambaugh met with customers, candidates, and old industry friends.

PTS Team - We continue to build out our team as we focus on industry trends moving towards Aid & Development, Cybersecurity, Cloud, Intelligence, and Business Development. PTS recently brought on Michael Stambaugh, to serve as our Chief Growth Officer. Michael is a former Chief Human Resources Officer with over 22 years of experience building talent acquisition teams across governmental and non-governmental industries. As a former Army veteran - and classically trained chef - turned HR executive, Michael has experienced every aspect of the talent and people business. His time supporting civilian organizations in direct support of the armed forces gives him the ideal skill set to serve at PTS. PTS has also appointed Julie Kmet as the Chief Operating Officer. Julie brings 15+ years of government contracting talent acquisition and operational experience, demonstrating all the qualities to assume leadership of our daily operations. She has spent the past 5 years with PTS building and growing our capabilities. Previously, Julie worked with large government contractors across our industry both OCONUS and CONUS.

Lulora Aliu - Contracts, HR, LOGCAP

Joshua Belcher - Logistics, BOSS, AFCAP

Victor Ames - Exec BD roles, DTRA, Program/Project Managers

Andy MacWilliams - Exec BD roles, Security, Special Operations, Intel Community Shawn Doble - Security, Operations

Marguerite Benson - Intel Community, Cyber Security, Fed IT

Martyn Brooks - Security, Operations and HR

Nevenka Popovic - Program Managers, Operations Wills Hay - Project Managers, IT Cloud and BD

Domestic US and Executive Recruiting - PTS continues to serve as the GovCon leader in talent acquisition for international government contracting programs. C-Suite, Vice President, and Director level placements account for more than 70% of our workload. These top executives serve a wide range of organizations in the GovCon industry, from healthcare, facilities management, security operations, business advisory, and more. In conjunction with our traditional DoD, State, and USAID placements, we continue to support a range of domestic agencies, including HHS, DHS, DoJ, IC, Treasury, and DHA.

PTS Diversity and Veterans Support - PTS continues to support veterans transitioning from military to the civilian workforce. Last quarter we highlighted Colonel Mark Vertuli, a transitioning strategic leader with extensive experience directing information, cyberspace, space, and strategic operations around the globe. He retired in August 2022, you may reach him through PTS or directly at mark.vertuli@gmail.com. We are also supporting Colonel Ken Letcher, PhD, who will be retiring at the end of this month. You may reach him at kwletcher@gmail.com or through PTS directly. Reach out today if you’re retiring from military service and seek advice on next steps. As a Veteran Owned Small Business, we want to support our service members and help them make an effective transition to civilian life.

Advanced Technology - Technology makes recruiting practices more efficient and extends their reach. PTS prides itself on being at the forefront of digital transformation within the field of GovCon talent acquisition. Recent investments in our ATS and CRM modernized our industry-leading platform. These upgrades help deliver increased capacity. We will continue our proven model providing video interviews, personality assessments, technical scorecards, and references to give our customers talent acquisition solutions.