• Second Quarter 2018 Revenues of $512.1 Million, Up 15.2% Compared to Prior Year Quarter
  • Second Quarter Fully Diluted Earnings (Loss) per Share of $1.14 Compared to $(0.13) in Prior Year Quarter; Second Quarter Adjusted EPS of $1.14 Compared to $0.40 in Prior Year Quarter
  • Full Year 2018 Guidance Increased

WASHINGTON, July 26, 2018 (GLOBE NEWSWIRE) -- FTI Consulting, Inc. (NYSE:FCN) today released record financial results for the quarter ended June 30, 2018.

Second quarter 2018 revenues of $512.1 million increased $67.4 million, or 15.2%, compared to revenues of $444.7 million in the prior year quarter. Excluding the estimated positive impact from foreign currency translation (“FX”), revenues increased by $61.6 million, or 13.8%, compared to the prior year quarter. The increase in revenues was primarily driven by higher demand within the Corporate Finance & Restructuring, Forensic and Litigation Consulting, Strategic Communications and Economic Consulting segments. Net income of $43.6 million compared to a net loss of $5.2 million in the prior year quarter, which included a pretax special charge of $30.1 million related to headcount and real estate actions. The increase in net income was largely due to higher operating profits and a lower effective income tax rate compared to the prior year quarter. Adjusted EBITDA of $72.4 million, or 14.1% of revenues, compared to $40.8 million, or 9.2% of revenues, in the prior year quarter. The increase in Adjusted EBITDA was primarily due to higher revenues and improved utilization.

Second quarter 2018 fully diluted earnings per share (“EPS”) of $1.14 compared to fully diluted loss per share of $(0.13) in the prior year quarter. EPS (Loss) in the prior year quarter included the aforementioned special charge, which reduced EPS by $0.52. Adjusted EPS of $1.14 compared to $0.40 in the prior year quarter.

Commenting on these results, Steven H. Gunby, President and Chief Executive Officer of FTI Consulting, said, “We are very pleased with our record first half of 2018. Critically, that success supports our commitment to invest in our people by promoting internally and attracting superb professionals to our firm, which, in turn, allows us to further enhance our ability to help our clients navigate many of the largest and most complex issues in the world.”

Cash Position and Capital Allocation

Net cash provided by operating activities of $34.6 million for the quarter ended June 30, 2018 compared to $10.9 million for the quarter ended June 30, 2017. The increase was primarily due to higher cash collections resulting from increased revenues, which was partially offset by higher income tax payments. Total debt of $375.0 million at June 30, 2018 compared to $445.0 million at March 31, 2018 and $485.0 million at June 30, 2017. Cash and cash equivalents of $116.6 million at June 30, 2018 declined $35.5 million from March 31, 2018.

Second Quarter 2018 Segment Results

Corporate Finance & Restructuring
Revenues in the Corporate Finance & Restructuring segment increased $23.9 million, or 20.3%, to $141.4 million in the quarter compared to $117.5 million in the prior year quarter. The increase in revenues was due to higher demand for restructuring services coupled with higher realization for restructuring and business transformation services in the North America and Europe, Middle East and Africa regions. Adjusted Segment EBITDA was $35.8 million, or 25.3% of segment revenues, compared to $20.0 million, or 17.1% 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 $22.1 million, or 19.9%, to $133.5 million in the quarter compared to $111.4 million in the prior year quarter. The increase in revenues was primarily driven by higher demand and realization for investigations and construction solutions services. Adjusted Segment EBITDA was $27.6 million, or 20.7% of segment revenues, compared to $13.0 million, or 11.7% 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 increased $9.3 million, or 7.5%, to $133.3 million in the quarter, compared to $124.0 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $7.3 million, or 5.9% compared to the prior year quarter. The increase in revenues was primarily due to higher demand for financial economics and international arbitration services, which was partially offset by lower realization for antitrust services. Adjusted Segment EBITDA was $15.5 million, or 11.6% of segment revenues, compared to $15.5 million, or 12.5% of segment revenues, in the prior year quarter. Adjusted Segment EBITDA was consistent with the prior year quarter, as the increase in revenues was offset by higher variable compensation costs and an increase in billable headcount.

Technology
Revenues in the Technology segment increased $0.9 million, or 1.9%, to $46.4 million in the quarter compared to $45.6 million in the prior year quarter. The increase in revenues was primarily due to higher demand for consulting and hosting services. This was partially offset by lower demand for managed review services related to a decline in merger- and acquisition-related “second requests” and global investigations. Adjusted Segment EBITDA was $7.5 million, or 16.2% of segment revenues, compared to $5.4 million, or 11.9% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was primarily due to higher revenues and lower variable compensation costs for managed review services.

Strategic Communications
Revenues in the Strategic Communications segment increased $11.2 million, or 24.3%, to $57.5 million in the quarter compared to $46.2 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $9.6 million, or 20.8%, compared to the prior year quarter. The increase in revenues was primarily due to an increase in both project- and retainer-based revenues related to the financial communications and public affairs practices. Adjusted Segment EBITDA was $11.0 million, or 19.1% of segment revenues, compared to $4.9 million, or 10.5% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was primarily due to higher revenues, which was partially offset by higher variable compensation costs.

2018 Guidance

The Company is revising its full year 2018 guidance. The Company now estimates that 2018 revenues will range between $1.910 billion and $1.960 billion. This compares to the previous revenue range of between $1.825 billion and $1.875 billion. The Company now estimates that 2018 EPS will range between $2.90 and $3.30. This compares to the previous EPS range of between $2.35 and $2.65. The Company does not expect Adjusted EPS to differ from EPS.

Second Quarter 2018 Conference Call

FTI Consulting will host a conference call for analysts and investors to discuss second quarter 2018 financial results at 9:00 a.m. Eastern Time on July 26, 2018. The call can be accessed live and will be available for replay over the internet for 90 days by logging onto the Company’s investor relations website here.

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 2017. 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 generally accepted accounting principles (GAAP). Certain of these measures are considered non-GAAP financial measuresunder the Securities and Exchange Commission (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 Net Income
  • Adjusted Earnings per Diluted Share
  • Free Cash Flow

We have included the definitions of Segment Operating Income (Loss) 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 (Loss) 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 (Loss) for all segments, which excludes unallocated corporate expenses. We use Segment Operating Income (Loss) 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 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 (loss) and earnings (loss) per diluted share (EPS), respectively, excluding the impact of remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges, losses on early extinguishment of debt and the adjustment related to the adoption of the 2017 U.S. Tax Cuts and Jobs Act (2017 Tax Act). 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, losses on early extinguishment of debt and the adjustment related to the adoption of the 2017 Tax Act, 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 (used in) 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 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 statementswithin 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, fluctuations in the price per share of our common stock, adverse financial, real estate or 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, new laws and regulations, or changes thereto, including the 2017 Tax Act, and other risks described under the heading “Item 1A, Risk Factors” in the Company’s annual report on Form 10-K for the year ended December 31, 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, except per share amounts)
 
  June 30, December 31,
  2018 2017
  (unaudited)  
Assets    
Current assets    
Cash and cash equivalents $116,556  $189,961 
Accounts receivable:    
     Billed receivables 455,707  390,996 
     Unbilled receivables 368,360  312,569 
     Allowances for doubtful accounts and unbilled services (216,612) (180,687)
          Accounts receivable, net 607,455  522,878 
Current portion of notes receivable 28,619  25,691 
Prepaid expenses and other current assets 54,806  55,649 
     Total current assets 807,436  794,179 
Property and equipment, net 75,046  75,075 
Goodwill 1,198,732  1,204,803 
Other intangible assets, net 39,379  44,150 
Notes receivable, net 90,904  98,105 
Other assets 45,915  40,929 
                    Total assets $2,257,412  $2,257,241 
Liabilities and Stockholders' Equity    
Current liabilities    
Accounts payable, accrued expenses and other $93,988  $94,873 
Accrued compensation 224,663  268,513 
Billings in excess of services provided 33,653  46,942 
     Total current liabilities 352,304  410,328 
Long-term debt, net 371,662  396,284 
Deferred income taxes 134,081  124,471 
Other liabilities 123,564  134,187 
       Total liabilities 981,611  1,065,270 
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 — 38,179 (2018) and 37,729 (2017)
 382  377 
Additional paid-in capital 280,201  266,035 
Retained earnings 1,128,670  1,045,774 
Accumulated other comprehensive loss (133,452) (120,215)
     Total stockholders' equity 1,275,801  1,191,971 
          Total liabilities and stockholders' equity $2,257,412  $2,257,241 


 
FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands, except per share data)
 
 Three Months Ended
June 30,
 
 2018 2017
 (unaudited)
Revenues$512,098  $444,715 
Operating expenses   
Direct cost of revenues330,318  304,071 
Selling, general and administrative expenses117,897  108,119 
Special charges  30,074 
Amortization of other intangible assets2,052  2,422 
 450,267  444,686 
Operating income61,831  29 
Other income (expense)   
Interest income and other2,474  1,592 
Interest expense(6,583) (6,250)
 (4,109) (4,658)
Income (loss) before income tax provision57,722  (4,629)
Income tax provision14,113  527 
Net income (loss)$43,609  $(5,156)
Earnings (loss) per common share ― basic$1.18  $(0.13)
Weighted average common shares outstanding ― basic37,001  39,555 
Earnings (loss) per common share ― diluted$1.14  $(0.13)
Weighted average common shares outstanding ― diluted38,271  39,555 
Other comprehensive income (loss), net of tax   
Foreign currency translation adjustments, net of tax expense of $0$(23,683) $10,174 
Total other comprehensive income (loss), net of tax(23,683) 10,174 
Comprehensive income$19,926  $5,018 


 
FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands, except per share data)
 
 Six Months Ended
June 30,
 
 2018 2017
 (unaudited)
Revenues$1,009,872  $891,059 
Operating expenses   
Direct cost of revenues651,435  613,143 
Selling, general and administrative expenses230,025  215,809 
Special charges  30,074 
Amortization of other intangible assets4,322  4,915 
 885,782  863,941 
Operating income124,090  27,118 
Other income (expense)   
Interest income and other674  2,197 
Interest expense(12,827) (12,051)
 (12,153) (9,854)
Income before income tax provision111,937  17,264 
Income tax provision29,383  8,404 
Net income$82,554  $8,860 
Earnings per common share ― basic$2.24  $0.22 
Weighted average common shares outstanding ― basic36,851  40,039 
Earnings per common share ― diluted$2.18  $0.22 
Weighted average common shares outstanding ― diluted37,942  40,502 
Other comprehensive income (loss), net of tax   
Foreign currency translation adjustments, net of tax expense of $0$(13,237) $17,544 
Total other comprehensive income (loss), net of tax(13,237) 17,544 
Comprehensive income$69,317  $26,404 


 
FTI CONSULTING, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(in thousands, except per share data)
 
  Three Months Ended
June 30,
 Six Months Ended
June 30,
  2018 2017 2018 2017
  (Unaudited) (Unaudited)
Net income (loss) $43,609  $(5,156) $82,554  $8,860 
Add back:        
Special charges   30,074    30,074 
Tax impact of special charges   (9,103)   (9,103)
Remeasurement of acquisition-related contingent
  consideration
   536    702 
Tax impact of remeasurement of acquisition-
  related contingent consideration
   (204)   (269)
Adjusted net income $43,609  $16,147  $82,554  $30,264 
Earnings (loss) per common share — diluted $1.14  $(0.13) $2.18  $0.22 
Add back:        
Special charges   0.75    0.74 
Tax impact of special charges   (0.23)   (0.22)
Remeasurement of acquisition-related contingent
  consideration
   0.01    0.02 
Tax impact of remeasurement of acquisition-
  related contingent consideration
       (0.01)
Adjusted earnings per common share — diluted $1.14  $0.40  $2.18  $0.75 
Weighted average number of common shares
  outstanding ― diluted (1)
 38,271  39,932  37,942  40,502 


 

(1) For the three months ended June 30, 2017, the Company reported a net loss. For the period, the basic weighted average common shares outstanding equals the diluted weighted average common shares outstanding for purposes of calculating U.S. GAAP earnings per share because potentially dilutive securities would be antidilutive. For non-GAAP purposes, Adjusted EPS and diluted weighted average number of common shares outstanding presented herein reflect the impact of inclusion of share-based awards that are considered dilutive based on the impact of the add-backs included in Adjusted Net Income above.

 
FTI CONSULTING, INC.
RECONCILIATION OF NET INCOME AND OPERATING INCOME TO ADJUSTED EBITDA
(in thousands)
 
Three Months Ended June 30, 2018 (unaudited) Corporate
Finance &
Restructuring
 Forensic and
Litigation
Consulting
 Economic
Consulting
 Technology Strategic
Communications
 Unallocated
Corporate
 Total
Net income             $43,609 
Interest income and other             (2,474)
Interest expense             6,583 
Income tax provision             14,113 
Operating income $34,041  $26,173  $14,024  $3,967  $9,508  $(25,882) $61,831 
Depreciation and amortization 953  1,131  1,377  3,527  586  914  8,488 
Amortization of other intangible assets 783  311  71  14  873    2,052 
Adjusted EBITDA $35,777  $27,615  $15,472  $7,508  $10,967  $(24,968) $72,371 
               
Six Months Ended June 30, 2018
(unaudited)
 Corporate
Finance &
Restructuring
 Forensic and
Litigation
Consulting
 Economic
Consulting
 Technology Strategic
Communications
 Unallocated
Corporate
 Total
Net income             $82,554 
Interest income and other             (674)
Interest expense             12,827 
Income tax provision             29,383 
Operating income $67,252  $50,503  $31,672  $6,560  $17,873  $(49,770) $124,090 
Depreciation and amortization 1,755  2,159  2,741  6,604  1,179  1,815  16,253 
Amortization of other intangible assets 1,574  710  195  76  1,767    4,322 
Adjusted EBITDA $70,581  $53,372  $34,608  $13,240  $20,819  $(47,955) $144,665 
               
Three Months Ended June 30, 2017 (unaudited) Corporate
Finance &
Restructuring
 Forensic and
Litigation
Consulting
 Economic
Consulting
 Technology Strategic
Communications
 Unallocated
Corporate
 Total
Net income (loss)             $(5,156)
Interest income and other             (1,592)
Interest expense             6,250 
Income tax provision             527 
Operating income (loss) $15,447  $1,183  $8,008  $(1,568) $(755) $(22,286) $29 
Depreciation and amortization 768  1,032  1,436  3,001  546  944  7,727 
Amortization of other intangible assets 784  372  155  161  950    2,422 
Special charges 3,049  10,445  5,910  3,827  3,599  3,244  30,074 
Remeasurement of acquisition-related
  contingent consideration
         536    536 
Adjusted EBITDA $20,048  $13,032  $15,509  $5,421  $4,876  $(18,098) $40,788 
               
Six Months Ended June 30, 2017
(unaudited)
 Corporate
Finance &
Restructuring
 Forensic and
Litigation
Consulting
 Economic
Consulting
 Technology Strategic
Communications
 Unallocated
Corporate
 Total
Net income             $8,860 
Interest income and other             (2,197)
Interest expense             12,051 
Income tax provision             8,404 
Operating income $24,196  $13,107  $26,510  $2,872  $1,772  $(41,339) $27,118 
Depreciation and amortization 1,549  2,205  2,890  6,207  1,148  2,299  16,298 
Amortization of other intangible assets 1,579  796  309  319  1,912    4,915 
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 $30,373  $26,553  $35,619  $13,225  $9,133  $(35,796) $79,107 


 
FTI CONSULTING, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
 
  

Segment
Revenues
 Adjusted
EBITDA
 Adjusted
EBITDA

Margin
 Utilization  Average
Billable
Rate
 Revenue-
Generating
Headcount
  (in thousands)       (at period end)
Three Months Ended June 30, 2018 (unaudited)           
Corporate Finance & Restructuring$141,355  $35,777  25.3% 67% $458  871 
Forensic and Litigation Consulting133,527  27,615  20.7% 67% $340  1,065 
Economic Consulting133,308  15,472  11.6% 69% $534  695 
Technology (1)46,429  7,508  16.2% N/M   N/M  293 
Strategic Communications (1)57,479  10,967  19.1% N/M   N/M  628 
 $512,098  $97,339  19.0%     3,552 
Unallocated Corporate  (24,968)        
Adjusted EBITDA  $72,371  14.1%      
            
Six Months Ended June 30, 2018
(unaudited)
           
Corporate Finance & Restructuring$284,277  $70,581  24.8% 69% $450  871 
Forensic and Litigation Consulting261,566  53,372  20.4% 67% $334  1,065 
Economic Consulting266,417  34,608  13.0% 70% $538  695 
Technology (1)87,343  13,240  15.2% N/M   N/M  293 
Strategic Communications (1)110,269  20,819  18.9% N/M   N/M  628 
 $1,009,872  $192,620  19.1%     3,552 
Unallocated Corporate  (47,955)        
Adjusted EBITDA  $144,665  14.3%      
            
Three Months Ended June 30, 2017 (unaudited)           
Corporate Finance & Restructuring$117,487  $20,048  17.1% 60% $403  881 
Forensic and Litigation Consulting111,410  13,032  11.7% 60% $310  1,070 
Economic Consulting124,004  15,509  12.5% 68% $542  652 
Technology (1)45,566  5,421  11.9% N/M   N/M  301 
Strategic Communications (1)46,248  4,876  10.5% N/M   N/M  659 
 $444,715  $58,886  13.2%     3,563 
Unallocated Corporate  (18,098)        
Adjusted EBITDA  $40,788  9.2%      
            
Six Months Ended June 30, 2017
(unaudited)
           
Corporate Finance & Restructuring$223,388  $30,373  13.6% 60% $390  881 
Forensic and Litigation Consulting222,816  26,553  11.9% 60% $320  1,070 
Economic Consulting263,225  35,619  13.5% 70% $548  652 
Technology (1)91,653  13,225  14.4% N/M   N/M  301 
Strategic Communications (1)89,977  9,133  10.2% N/M   N/M  659 
 $891,059  $114,903  12.9%     3.563 
Unallocated Corporate  (35,796)        
Adjusted EBITDA  $79,107  8.9%      
            
            
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)
 
 Six Months Ended
June 30,
 
 2018 2017
 (unaudited)
Operating activities   
Net income$82,554  $8,860 
Adjustments to reconcile net income to net cash used in operating activities:   
Depreciation and amortization16,253  16,298 
Amortization and impairment of other intangible assets4,322  4,915 
Acquisition-related contingent consideration232  1,172 
Provision for doubtful accounts8,710  5,971 
Non-cash share-based compensation8,563  9,959 
Non-cash interest expense and other993  992 
Other798  242 
Changes in operating assets and liabilities, net of effects from acquisitions:   
     Accounts receivable, billed and unbilled(99,299) (78,100)
     Notes receivable4,214  2,241 
     Prepaid expenses and other assets(4,151) 947 
     Accounts payable, accrued expenses and other352  (1,887)
     Income taxes13,143  3,087 
     Accrued compensation(58,547) (64,531)
     Billings in excess of services provided(12,722) 7,634 
                      Net cash used in operating activities(34,585) (82,200)
Investing activities   
Purchases of property and equipment(16,220) (13,127)
Other689  72 
                      Net cash used in investing activities(15,531) (13,055)
Financing activities   
Borrowings (repayments) under revolving line of credit, net(25,000) 115,000 
Deposits2,602  3,262 
Purchase and retirement of common stock(14,220) (102,513)
Net issuance of common stock under equity compensation plans18,740  (500)
Payments for acquisition-related contingent consideration(3,029) (79)
                      Net cash provided by (used in) financing activities(20,907) 15,170 
Effect of exchange rate changes on cash and cash equivalents(2,382) 2,438 
Net decrease in cash and cash equivalents(73,405) (77,647)
Cash and cash equivalents, beginning of period189,961  216,158 
Cash and cash equivalents, end of period$116,556  $138,511 
 

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