FTI Consulting Reports Third Quarter 2017 Financial Results

FTI Consulting Reports Third Quarter 2017 Financial Results

  • Revenues of $449.0 Million, up 2.5% over Prior Year
  • Fully Diluted EPS of $0.85, up 63.5% over Prior Year; Adjusted EPS of $0.83, up 59.6% over Prior Year
  • $52.7 Million Returned through Share Repurchases during Third Quarter

WASHINGTON, Oct. 26, 2017 (GLOBE NEWSWIRE) -- FTI Consulting, Inc. (NYSE:FCN) today released its financial results for the quarter ended September 30, 2017.

For the quarter, revenues of $449.0 million increased $10.9 million, or 2.5%, compared to revenues of $438.0 million in the prior year quarter. The increase in revenues was primarily driven by higher revenues in the Corporate Finance & Restructuring segment. Third quarter 2017 net income of $32.2 million increased $10.5 million, or 48.5% compared to net income of $21.7 million in the prior year quarter. Adjusted EBITDA was $57.4 million, or 12.8% of revenues, compared to $47.2 million, or 10.8% of revenues, in the prior year quarter. The increase in Adjusted EBITDA was due to an increase in higher margin revenues, including success fees, improved utilization, and lower selling, general and administrative expenses. Fully diluted earnings per share (“EPS”) of $0.85 and Adjusted EPS were $0.83, compared to EPS and Adjusted EPS of $0.52 in the prior year quarter. Both EPS and Adjusted EPS were benefited by a lower effective tax rate, which included the benefits of reduced foreign net operating losses and related valuation allowances resulting from intercompany service fees and an increase in the projected mix of lower taxed foreign earnings.

Commenting on these results, Steven H. Gunby, President and Chief Executive Officer of FTI Consulting, said, “We are the leader in many of our practices across the world. This quarter’s results reflect those leadership positions coupled with prudent cost management and the significant progress we have made growing and adding talent in the areas in which we have a right to win.”

Cash Position and Capital Allocation
Net cash provided by operating activities of $106.2 million for the three months ended September 30, 2017, compared to $70.9 million for the three months ended September 30, 2016. The improvement in operating cash flow was due to higher cash collections, lower income tax payments, and the timing of certain operating expenses and payroll.  

During the quarter, the Company repurchased 1,599,400 shares of its common stock at an average price of $32.98 for a total cost of $52.7 million. As of September 30, 2017, $26.1 million remained available under the Company’s $200.0 million share repurchase authorization.

Total debt of $465.0 million at September 30, 2017, compared to $475.0 million at September 30, 2016. Cash and cash equivalents were $158.0 million at September 30, 2017, compared to $225.2 million at September 30, 2016. Total debt, net of cash, of $307.0 million at September 30, 2017, compared to $249.8 million at September 30, 2016.

Third Quarter 2017 Segment Results

Corporate Finance & Restructuring
Revenues in the Corporate Finance & Restructuring segment increased $17.5 million, or 15.8%, to $128.1 million in the quarter, compared to $110.6 million in the prior year quarter. Revenues increased primarily due to higher demand for restructuring services globally and an increase in success fees. Adjusted Segment EBITDA was $26.7 million, or 20.9% of segment revenues, compared to $17.8 million, or 16.1% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was primarily due to higher revenues with improved utilization.

Forensic and Litigation Consulting
Revenues in the Forensic and Litigation Consulting segment increased $3.6 million, or 3.1%, to $118.6 million in the quarter, compared to $115.0 million in the prior year quarter. The increase in revenues was primarily due to higher demand for forensic accounting and advisory services and construction solutions offerings, which was partially offset by lower success fees in health solutions. Adjusted Segment EBITDA was $22.5 million, or 19.0% of segment revenues, compared to $16.6 million, or 14.4% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was primarily due to higher revenues with improved utilization.

Economic Consulting
Revenues in the Economic Consulting segment decreased $10.7 million, or 8.8%, to $111.8 million in the quarter, compared to $122.5 million in the prior year quarter. The decrease in revenues was primarily due to lower demand for antitrust and financial economics services in North America. Adjusted Segment EBITDA was $12.1 million, or 10.8% of segment revenues, compared to $18.4 million, or 15.0% of segment revenues, in the prior year quarter. The decrease in Adjusted Segment EBITDA was primarily due to lower revenues with lower utilization, which was partially offset by lower compensation costs.

Technology
Revenues in the Technology segment decreased $1.8 million, or 4.1%, to $42.3 million in the quarter, compared to $44.1 million in the prior year quarter. The decrease in revenues was primarily driven by lower demand for managed review and lower pricing for hosting services, which was partially offset by higher demand for consulting services. This shift was largely related to the wind down of large cross-border investigations, which was partially offset by increased M&A-related “second request” activity. Adjusted Segment EBITDA was $6.0 million, or 14.1% of segment revenues, compared to $7.4 million, or 16.8% of segment revenues, in the prior year quarter. The decrease in Adjusted Segment EBITDA was due to a decline in higher margin hosting-related revenues.

Strategic Communications
Revenues in the Strategic Communications segment increased $2.3 million, or 5.1%, to $48.2 million in the quarter, compared to $45.8 million in the prior year quarter. The increase in revenues was primarily driven by an increase in retainer-based revenues, which was partially offset by lower pass-through revenues. Adjusted Segment EBITDA was $8.1 million, or 16.8% of segment revenues, compared to $7.5 million, or 16.4% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was due to the increase in revenues.

2017 Guidance
The Company revised its full year 2017 guidance for revenues to be between $1.775 billion and $1.800 billion. This compares to the previous range of between $1.775 billion and $1.875 billion. The Company reaffirmed full year 2017 guidance for EPS and Adjusted EPS to be between $1.37 and $1.67 and $1.90 and $2.20, respectively. The variance between EPS and Adjusted EPS guidance is related to the second quarter of 2017 special charge of $30.1 million, or $0.52 per share, resulting from headcount reductions, the Company’s Washington, D.C., office relocation and other costs related to the disposal or closure of several small international offices.

Third Quarter 2017 Conference Call
FTI Consulting will host a conference call for analysts and investors to discuss third quarter 2017 financial results at 9:00 a.m. Eastern Time on October 26, 2017. The call can be accessed live and will be available for replay over the Internet for 90 days by logging on to the Company's investor relations website here.

Investor Day
FTI Consulting will host an investor day on Monday, November, 13, 2017, from 10:00 a.m. to 2:30 p.m. Eastern Time. Presentations will be presented by members of FTI Consulting’s executive committee. The event will take place at 10 on the Park at the Time Warner Center, located at 60 Columbus Circle, New York, NY 10019, and is open to institutional investors and analysts. Visit the Company’s Investor Day website here to RSVP for this event.

About FTI Consulting
FTI Consulting, Inc. is a global business advisory firm dedicated to helping organizations manage change, mitigate risk and resolve disputes: financial, legal, operational, political & regulatory, reputational and transactional. With more than 4,600 employees located in 28 countries, FTI Consulting professionals work closely with clients to anticipate, illuminate and overcome complex business challenges and make the most of opportunities. The Company generated $1.81 billion in revenues during fiscal year 2016. More information can be found at www.fticonsulting.com.

Use of Non-GAAP Measures

In the accompanying analysis of financial information, we sometimes use information derived from consolidated and segment financial information that may not be presented in our financial statements or prepared in accordance with GAAP. Certain of these measures are considered “non-GAAP financial measures” under the SEC rules. Specifically, we have referred to the following non-GAAP measures:

  • Total Segment Operating Income
  • Adjusted EBITDA
  • Total Adjusted Segment EBITDA
  • Adjusted EBITDA Margin/Adjusted Segment EBITDA Margin
  • Adjusted Net Income
  • Adjusted Earnings per Diluted Share
  • Free Cash Flow

We have included the definitions of Segment Operating Income and Adjusted Segment EBITDA below in order to more fully define the components of certain non-GAAP financial measures presented in this earnings release. We define Segment Operating Income as a segment’s share of Consolidated Operating Income. We define Total Segment Operating Income, which is a non-GAAP financial measure, as the total of Segment Operating Income for all segments, which excludes unallocated corporate expenses. We use Segment Operating Income for the purpose of calculating Adjusted Segment EBITDA. We define Adjusted Segment EBITDA as a segment’s share of Consolidated Operating Income before depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges. We use Adjusted Segment EBITDA as a basis to internally evaluate the financial performance of our segments because we believe it reflects current core operating performance and provides an indicator of the segment’s ability to generate cash. We define Adjusted Segment EBITDA Margin as Adjusted Segment EBITDA as a percentage of a segment’s revenues.

We define Total Adjusted Segment EBITDA, which is a non-GAAP financial measure, as the total of Adjusted Segment EBITDA for all segments, which excludes unallocated corporate expenses. We define Adjusted EBITDA, which is a non-GAAP financial measure, as consolidated net income before income tax provision, other non-operating income (expense), depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges and losses on early extinguishment of debt. We define Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of total revenues. We believe that the non-GAAP financial measures, which exclude the effects of remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges, when considered together with our GAAP financial results and GAAP measures, provide management and investors with a more complete understanding of our operating results, including underlying trends. In addition, EBITDA is a common alternative measure of operating performance used by many of our competitors. It is used by investors, financial analysts, rating agencies and others to value and compare the financial performance of companies in our industry. Therefore, we also believe that these measures, considered along with corresponding GAAP measures, provide management and investors with additional information for comparison of our operating results with the operating results of other companies.

We define Adjusted Net Income and Adjusted Earnings per Diluted Share (“Adjusted EPS”), which are non-GAAP financial measures, as net income and earnings per diluted share, respectively, excluding the impact of remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges and losses on early extinguishment of debt. We use Adjusted Net Income for the purpose of calculating Adjusted EPS. Management uses Adjusted EPS to assess total Company operating performance on a consistent basis. We believe that this non-GAAP financial measure, which excludes the effects of the remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges and losses on early extinguishment of debt, when considered together with our GAAP financial results, provides management and investors with an additional understanding of our business operating results, including underlying trends.

We define Free Cash Flow as net cash provided by operating activities less cash payments for purchases of property and equipment. We believe this non-GAAP financial measure, when considered together with our GAAP financial results, provides management and investors with an additional understanding of the Company’s ability to generate cash for ongoing business operations and other capital deployment.

Non-GAAP financial measures are not defined in the same manner by all companies and may not be comparable with other similarly titled measures of other companies. Non-GAAP financial measures should be considered in addition to, but not as a substitute for or superior to, the information contained in our Condensed Consolidated Statements of Comprehensive Income. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the financial tables accompanying this press release.

Safe Harbor Statement
This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which involve uncertainties and risks. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenues, future results and performance, expectations, plans or intentions relating to acquisitions, share repurchases and other matters, business trends and other information that is not historical, including statements regarding estimates of our future financial results. When used in this press release, words such as "estimates," "expects," "anticipates," "projects," "plans," "intends," "believes," "forecasts" and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, estimates of our future financial results, are based upon our expectations at the time we make them and various assumptions. Our expectations, beliefs and projections are expressed in good faith, and we believe there is a reasonable basis for them. However, there can be no assurance that management's expectations, beliefs and estimates will be achieved, and the Company's actual results may differ materially from our expectations, beliefs and estimates. Further, preliminary results are subject to normal year-end adjustments. The Company has experienced fluctuating revenues, operating income and cash flows in prior periods and expects that this will occur from time to time in the future. Other factors that could cause such differences include declines in demand for, or changes in, the mix of services and products that we offer, the mix of the geographic locations where our clients are located or where services are performed, adverse financial, real estate, fluctuations in the price per share of our common stock, other market and general economic conditions and other future events, which could impact each of our segments differently and could be outside of our control, the pace and timing of the consummation and integration of future acquisitions, the Company's ability to realize cost savings and efficiencies, competitive and general economic conditions, retention of staff and clients, and other risks described under the heading "Item 1A Risk Factors" in the Company's quarterly report on the Form 10-Q for the quarter ended June 30, 2017 filed with the SEC, including the risks set forth under "Risks Related to Our Reportable Segments" and "Risks Related to Our Operations," and in the Company's other filings with the SEC. We are under no duty to update any of the forward-looking statements to conform such statements to actual results or events and do not intend to do so. 

FINANCIAL TABLES FOLLOW


FTI CONSULTING, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
             
    September 30,   December 31, 
      2017       2016  
    (Unaudited)    
Assets        
Current assets        
Cash and cash equivalents   $ 157,961     $ 216,158  
Accounts receivable:        
Billed receivables     415,090       365,385  
Unbilled receivables     328,526       288,331  
Allowance for doubtful accounts and unbilled services     (196,484 )     (178,819 )
Accounts receivable, net     547,132       474,897  
Current portion of notes receivable     23,924       31,864  
Prepaid expenses and other current assets     59,196       60,252  
Total current assets     788,213       783,171  
Property and equipment, net of accumulated depreciation     70,982       61,856  
Goodwill     1,204,164       1,180,001  
Other intangible assets, net of amortization     46,788       52,120  
Notes receivable, net of current portion     106,462       104,524  
Other assets     43,984       43,696  
Total assets   $ 2,260,593     $ 2,225,368  
         
Liabilities and Stockholders' Equity        
Current liabilities        
Accounts payable, accrued expenses and other   $ 108,054     $ 87,320  
Accrued compensation     232,291       261,500  
Billings in excess of services provided     26,521       29,635  
Total current liabilities     366,866       378,455  
Long-term debt, net     461,095       365,528  
Deferred income taxes     181,293       173,799  
Other liabilities     120,410       100,228  
Total liabilities     1,129,664       1,018,010  
         
Stockholders' equity        
Preferred stock, $0.01 par value; shares authorized ― 5,000; none outstanding    
Common stock, $0.01 par value; shares authorized ― 75,000; shares issued and
  outstanding ― 37,941 (2017) and 42,037 (2016)
    379       420  
Additional paid-in capital     273,765       416,816  
Retained earnings     978,886       941,001  
Accumulated other comprehensive loss     (122,101 )     (150,879 )
Total stockholders' equity     1,130,929       1,207,358  
Total liabilities and stockholders' equity   $ 2,260,593     $ 2,225,368  
         

 

FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands, except per share data)
(Unaudited)
                                         
      Three Months Ended
      September 30, 
              2017       2016  
           
Revenues      $ 448,962      $ 438,042  
           
Operating expenses          
Direct cost of revenues         294,851         293,702  
Selling, general and administrative expenses       103,909       106,220  
Acquisition-related contingent consideration       252       201  
Amortization of other intangible assets       2,882       2,845  
        401,894       402,968  
           
Operating income       47,068       35,074  
           
Other income (expense)          
Interest income and other       1,103       3,213  
Interest expense       (6,760 )     (6,304 )
        (5,657 )     (3,091 )
           
Income before income tax provision       41,411       31,983  
           
Income tax provision       9,197       10,292  
           
Net income     $ 32,214     $ 21,691  
           
Earnings per common share ― basic     $ 0.86     $ 0.53  
Weighted average common shares outstanding ― basic       37,431       41,239  
           
Earnings per common share ― diluted     $ 0.85     $ 0.52  
Weighted average common shares outstanding ― diluted       37,746       42,065  
           
           
Other comprehensive income (loss), net of tax          
Foreign currency translation adjustments, net of tax expense of $0     $ 11,234     $ (4,478 )
Total other comprehensive income (loss), net of tax       11,234       (4,478 )
Comprehensive income     $ 43,448     $ 17,213  
           

 

FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands, except per share data)
(Unaudited)
           
    Nine Months Ended
                                  September 30, 
      2017       2016  
         
Revenues    $   1,340,021      $   1,368,474  
         
Operating expenses        
Direct cost of revenues     907,994       902,532  
Selling, general and administrative expenses     318,546       318,074  
Special charges     30,074       6,811  
Acquisition-related contingent consideration     1,424       1,541  
Amortization of other intangible assets     7,797       8,041  
      1,265,835       1,236,999  
         
Operating income     74,186       131,475  
         
Other income (expense)        
Interest income and other     3,300       9,895  
Interest expense     (18,811 )     (18,836 )
      (15,511 )     (8,941 )
         
Income before income tax provision     58,675       122,534  
         
Income tax provision     17,601       44,115  
         
Net income   $ 41,074     $ 78,419  
         
Earnings per common share ― basic   $ 1.05     $ 1.92  
Weighted average common shares outstanding ― basic     39,301       40,856  
         
Earnings per common share ― diluted   $ 1.03     $ 1.88  
Weighted average common shares outstanding ― diluted     39,715       41,605  
         
         
Other comprehensive income (loss), net of tax        
Foreign currency translation adjustments, net of tax expense of $0   $ 28,778     $ (23,645 )
Total other comprehensive income (loss), net of tax     28,778       (23,645 )
Comprehensive income   $ 69,852     $ 54,774  
         

 

FTI CONSULTING, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(in thousands, except per share data)
                 
    Three Months Ended September 30,   Nine Months Ended September 30,
      2017       2016     2017       2016  
    (Unaudited)   (Unaudited)
             
Net income   $ 32,214     $ 21,691   $ 41,074     $ 78,419  
Add back:                
Special charges         30,074       6,811  
Tax impact of special charges     (832 )       (9,935 )     (2,483 )
Remeasurement of acquisition-related contingent consideration         702       980  
Tax impact of remeasurement of acquisition-related contingent consideration         (269 )     (380 )
Adjusted Net Income   $ 31,382     $ 21,691   $ 61,646     $ 83,347  
                 
Earnings per common share ― diluted   $ 0.85     $ 0.52   $ 1.03     $ 1.88  
Add back:                
Special charges         0.76       0.16  
Tax impact of special charges     (0.02 )       (0.25 )     (0.06 )
Remeasurement of acquisition-related contingent consideration         0.02       0.02  
Tax impact of remeasurement of acquisition-related contingent consideration         (0.01 )     -  
Adjusted earnings per common share ― diluted   $ 0.83     $ 0.52   $ 1.55     $ 2.00  
                 
Weighted average number of common shares outstanding ― diluted     37,746       42,065     39,715       41,605  
                 

 

FTI CONSULTING, INC.
RECONCILIATION OF NET INCOME AND OPERATING INCOME TO ADJUSTED EBITDA
(in thousands)
                           
    Corporate Finance      Forensic and   Economic       Strategic        
Three Months Ended September 30, 2017 (Unaudited)   & Restructuring   Litigation Consulting   Consulting   Technology    Communications   Corp HQ   Total
                           
Net income                         $ 32,214  
Interest income and other                         (1,103 )
Interest expense                         6,760  
Income tax provision                         9,197  
Operating income   $ 24,706   $ 21,127   $ 10,524   $ 3,002   $ 6,536   $ (18,827 )   $ 47,068  
Depreciation and amortization 811   1,012   1,383   2,813   584   867     7,470  
Amortization of other intangible assets     1,217   400   154   158   953     2,882  
Adjusted EBITDA    $ 26,734   $ 22,539   $ 12,061   $ 5,973   $ 8,073   $ (17,960 )   $ 57,420  
                           
                           
    Corporate Finance    Forensic and   Economic       Strategic        
Nine Months Ended September 30, 2017 (Unaudited)   & Restructuring   Litigation Consulting   Consulting   Technology    Communications   Corp HQ   Total
                           
Net income                          $ 41,074  
Interest income and other                         (3,300 )
Interest expense                         18,811  
Income tax provision                         17,601  
Operating income   $ 48,902   $ 34,234   $ 37,034   $ 5,874   $ 8,308   $ (60,166 )   $ 74,186  
Depreciation and amortization 2,360   3,217   4,273   9,020   1,732   3,166     23,768  
Amortization of other intangible assets 2,796   1,196   463   477   2,865     7,797  
Special charges 3,049   10,445   5,910   3,827   3,599   3,244     30,074  
Remeasurement of acquisition-related contingent consideration             702     702  
Adjusted EBITDA    $ 57,107   $ 49,092   $ 47,680   $ 19,198   $ 17,206   $ (53,756 )   $ 136,527  
                           
                           
    Corporate Finance    Forensic and   Economic       Strategic        
Three Months Ended September 30, 2016 (Unaudited)   & Restructuring   Litigation Consulting   Consulting   Technology    Communications   Corp HQ   Total
                           
Net income                          $ 21,691  
Interest income and other                         (3,213 )
Interest expense                         6,304  
Income tax provision                         10,292  
Operating income   $ 16,182   $ 14,867   $ 16,888   $ 2,869   $ 6,006   $ (21,738 )   $ 35,074  
Depreciation and amortization 698   1,203   1,312   4,121   586   1,390     9,310  
Amortization of other intangible assets     882   484   154   408   917   -     2,845  
Adjusted EBITDA    $ 17,762   $ 16,554   $ 18,354   $ 7,398   $ 7,509   $ (20,348 )   $ 47,229  
                           
                           
    Corporate Finance   Forensic and   Economic       Strategic        
Nine Months Ended September 30, 2016 (Unaudited)   & Restructuring   Litigation Consulting   Consulting   Technology    Communications   Corp HQ   Total
                           
Net income                          $ 78,419  
Interest income and other                         (9,895 )
Interest expense                         18,836  
Income tax provision                         44,115  
Operating income   $ 76,740   $ 45,005   $ 51,390   $ 2,569   $ 16,661   $ (60,890 )   $ 131,475  
Depreciation and amortization 2,175   3,278   3,172   11,901   1,602   3,231     25,359  
Amortization of other intangible assets 2,491   1,519   492   725   2,814     8,041  
Special Charges   1,750     5,061       6,811  
Remeasurement of acquisition-related contingent consideration             980     980  
Adjusted EBITDA    $ 81,406   $ 51,552   $ 55,054   $ 20,256   $ 22,057   $ (57,659 )   $ 172,666  
                           
                           

 

FTI CONSULTING, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
                              Average      Revenue-
    Segment    Adjusted   Adjusted EBITDA        Billable    Generating
    Revenues   EBITDA   Margin   Utilization    Rate    Headcount
      (in thousands)                (at period end)
Three Months Ended September 30, 2017 (Unaudited)                    
Corporate Finance & Restructuring   $ 128,121   $ 26,734     20.9 %   64 %   $ 390   934
Forensic and Litigation Consulting     118,639     22,539     19.0 %   63 %   $ 326   1,080
Economic Consulting     111,753     12,061     10.8 %   62 %   $ 520   688
Technology(1)     42,282     5,973     14.1 %   N/M   N/M   291
Strategic Communications(1)     48,167     8,073     16.8 %   N/M   N/M   626
    $ 448,962   $ 75,380     16.8 %           3,619
Unallocated Corporate         (17,960 )                
Adjusted EBITDA        $ 57,420     12.8 %            
                         
Nine Months Ended September 30, 2017 (Unaudited)                    
Corporate Finance & Restructuring   $ 351,509   $ 57,107     16.2 %   61 %   $ 383   934
Forensic and Litigation Consulting     341,455     49,092     14.4 %   61 %   $ 318   1,080
Economic Consulting     374,978     47,680     12.7 %   68 %   $ 519   688
Technology(1)     133,935     19,198     14.3 %   N/M   N/M   291
Strategic Communications(1)     138,144     17,206     12.5 %   N/M   N/M   626
    $ 1,340,021   $ 190,283     14.2 %           3,619
Unallocated Corporate         (53,756 )                
Adjusted EBITDA        $ 136,527     10.2 %            
                         
Three Months Ended September 30, 2016 (Unaudited)                    
Corporate Finance & Restructuring   $ 110,617   $ 17,762     16.1 %   61 %   $ 379   904
Forensic and Litigation Consulting     115,045     16,554     14.4 %   57 %   $ 330   1,145
Economic Consulting     122,480     18,354     15.0 %   69 %   $ 534   647
Technology(1)     44,072     7,398     16.8 %   N/M   N/M   298
Strategic Communications(1)     45,828     7,509     16.4 %   N/M   N/M   624
    $ 438,042   $ 67,577     15.4 %           3,618
Unallocated Corporate         (20,348 )                
Adjusted EBITDA        $ 47,229     10.8 %            
                         
Nine Months Ended September 30, 2016 (Unaudited)                    
Corporate Finance & Restructuring    $ 369,915   $ 81,406     22.0 %   68 %   $ 388   904
Forensic and Litigation Consulting       352,242     51,552     14.6 %   60 %   $ 329   1,145
Economic Consulting     371,217     55,054     14.8 %   74 %   $ 516   647
Technology(1)     134,235     20,256     15.1 %   N/M   N/M   298
Strategic Communications(1)     140,865     22,057     15.7 %   N/M   N/M   624
    $ 1,368,474   $ 230,325     16.8 %           3,618
Unallocated Corporate         (57,659 )                
Adjusted EBITDA        $ 172,666     12.6 %            
                         
                         
N/M - Not meaningful
(1) The majority of the Technology and Strategic Communications segments' revenues are not generated based on billable hours. Accordingly, utilization and average billable rate metrics are not presented as they are not meaningful as a segment-wide metric.
                         

 

FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
           
    Nine months ended
                September 30,
      2017           2016  
Operating activities        
Net income   $ 41,074     $ 78,419  
         
Adjustments to reconcile net income to net cash provided by operating activities:        
Depreciation and amortization     23,768       25,359  
Amortization and impairment of other intangible assets     7,797       8,041  
Acquisition-related contingent consideration     1,547       1,541  
Provision for doubtful accounts     10,510       5,903  
Non-cash share-based compensation     12,888       13,381  
Non-cash interest expense     1,489       1,489  
Other     297       (1,159 )
Changes in operating assets and liabilities, net of effects from acquisitions:        
Accounts receivable, billed and unbilled         (72,640 )        (67,318 )
Notes receivable     8,449       (3,674 )
Prepaid expenses and other assets     935       (3,575 )
Accounts payable, accrued expenses and other     16,823       10,900  
Income taxes     8,876       28,204  
Accrued compensation     (34,123 )     4,486  
Billings in excess of services provided     (3,657 )     9,578  
  Net cash provided by operating activities     24,033       111,575  
         
Investing activities        
Payments for acquisition of businesses, net of cash received     (8,929 )     (56 )
Purchases of property and equipment     (20,021 )     (22,855 )
Other     74       74  
  Net cash used in investing activities     (28,876 )     (22,837 )
         
Financing activities        
Borrowings under revolving line of credit, net     95,000       (25,000 )
Deposits     3,585       2,806  
Purchase and retirement of common stock     (155,285 )     (2,903 )
Net issuance of common stock under equity compensation plans     (2,354 )     18,394  
Other     (79 )     357  
  Net cash used in financing activities     (59,133 )     (6,346 )
         
Effect of exchange rate changes on cash and cash equivalents     5,779       (6,968 )
         
Net increase (decrease) in cash and cash equivalents     (58,197 )     75,424  
Cash and cash equivalents, beginning of period     216,158       149,760  
Cash and cash equivalents, end of period   $ 157,961     $ 225,184  
         

FTI Consulting, Inc.
555 12th Street NW
Washington, DC 20004
+1.202.312.9100

Investor & Media Contact:
Mollie Hawkes
+1.617.747.1791
mollie.hawkes@fticonsulting.com

Primary Logo

FTI Consulting, Inc.

More Info

Share this page