• FTI Consulting Reports Record Fourth Quarter and Full Year 2023 Financial Results

    Источник: Nasdaq GlobeNewswire / 22 фев 2024 07:30:39   America/New_York

    • Fourth Quarter 2023 Revenues of $924.7 Million, Up 19% Compared to $774.4 Million in Prior Year Quarter; Excluding Estimated Positive Impact of FX, Fourth Quarter 2023 Revenues Up 18% Compared to Prior Year Quarter
    • Fourth Quarter 2023 EPS of $2.28, Up 71% Compared to $1.33 in Prior Year Quarter; Fourth Quarter 2023 Adjusted EPS of $2.28, Up 50% Compared to $1.52 in Prior Year Quarter
    • Full Year 2023 Revenues of $3.489 Billion, Up 15% Compared to $3.029 Billion in Prior Year
    • Full Year 2023 EPS of $7.71, Up 17% Compared to $6.58 in Prior Year; Full Year 2023 Adjusted EPS of $7.71, Up 14% Compared to $6.77 in Prior Year
    • Introduces 2024 Guidance

    WASHINGTON, Feb. 22, 2024 (GLOBE NEWSWIRE) -- FTI Consulting, Inc. (NYSE: FCN) today released financial results for the full year and fourth quarter ended December 31, 2023.

    For the full year 2023, revenues of $3.489 billion increased $460.3 million, or 15.2%, compared to revenues of $3.029 billion in the prior year. The increase in revenues was due to higher demand across all business segments. Net income of $274.9 million compared to $235.5 million in the prior year. The increase in net income was primarily due to higher revenues, which was partially offset by higher compensation, a 17.2% increase in selling, general and administrative ("SG&A") expenses and higher income taxes compared to the prior year. Adjusted EBITDA of $424.8 million, or 12.2% of revenues, compared to $357.6 million, or 11.8% of revenues, in the prior year.

    Full year 2023 earnings per diluted share ("EPS") of $7.71 compared to $6.58 in the prior year. Full year 2022 EPS included an $8.3 million special charge related to severance and other employee-related costs, which reduced EPS by $0.19. Full year 2023 Adjusted EPS of $7.71 compared to Adjusted EPS of $6.77 in the prior year.

    Steven H. Gunby, President and Chief Executive Officer of FTI Consulting, commented, "In 2023, we continued our sustained, multi-year growth trajectory and once again delivered record revenues and earnings. These results reflect our continued ability to win in the two markets that matter most: the market for making a difference for clients and the market for great talent. That progress leaves me ever more confident about the future of our firm."

    Cash Position and Capital Allocation

    Net cash provided by operating activities of $224.5 million for the year ended December 31, 2023 compared to $188.8 million for the year ended December 31, 2022. The year-over-year increase in net cash provided by operating activities was primarily due to higher cash collections resulting from increased revenues. The increase was partially offset by higher compensation expenses, primarily related to headcount growth, an increase in other operating expenses and higher use of working capital required for growth.

    Cash and cash equivalents and short-term investments of $328.7 million at December 31, 2023 compared to $491.7 million at December 31, 2022 and $225.6 million at September 30, 2023. Total debt, net of cash and short-term investments, of ($328.7) million at December 31, 2023 compared to ($175.5) million at December 31, 2022 and $59.4 million at September 30, 2023. The sequential decrease in total debt, net of cash and short-term investments, was primarily due to an increase in cash provided by operating activities.

    There were no share repurchases during the quarter ended December 31, 2023. In full year 2023, the Company repurchased 112,139 shares of its common stock at an average price per share of $158.70 for a total cost of $17.8 million. As of December 31, 2023, approximately $460.7 million remained available for common stock repurchases under the Company’s stock repurchase program.

    Fourth Quarter 2023 Results

    Fourth quarter 2023 revenues of $924.7 million increased $150.3 million, or 19.4%, compared to revenues of $774.4 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $139.0 million, or 18.0%, compared to the prior year quarter. The increase in revenues was due to higher demand across all business segments. Net income of $81.6 million compared to $47.5 million in the prior year quarter. The increase in net income was primarily due to higher revenues, which was partially offset by higher compensation and SG&A expenses compared to the prior year quarter. Adjusted EBITDA of $127.4 million, or 13.8% of revenues, compared to $92.0 million, or 11.9% of revenues, in the prior year quarter.

    Fourth quarter 2023 EPS of $2.28 compared to $1.33 in the prior year quarter. Fourth quarter 2022 EPS included the aforementioned $8.3 million special charge, which decreased EPS by $0.19. Fourth quarter 2023 Adjusted EPS of $2.28 compared to Adjusted EPS of $1.52 in the prior year quarter.

    Fourth Quarter 2023 Segment Results

    Corporate Finance & Restructuring
    Revenues in the Corporate Finance & Restructuring segment increased $60.2 million, or 19.7%, to $365.6 million in the quarter compared to $305.3 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $57.2 million, or 18.7%, compared to the prior year quarter. The increase in revenues was primarily due to higher demand for business transformation & strategy and restructuring services. Adjusted Segment EBITDA of $65.4 million, or 17.9% of segment revenues, compared to $49.1 million, or 16.1% 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 compensation, which includes the impact of a 5.5% increase in billable headcount and higher contractor costs, as well as an increase in SG&A expenses compared to the prior year quarter.

    Forensic and Litigation Consulting
    Revenues in the Forensic and Litigation Consulting segment increased $17.6 million, or 11.9%, to $165.5 million in the quarter compared to $147.9 million in the prior year quarter. The increase in revenues was primarily due to higher demand for investigations and construction solutions services. Adjusted Segment EBITDA of $19.2 million, or 11.6% of segment revenues, compared to $17.1 million, or 11.6% 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 an increase in compensation and higher SG&A expenses compared to the prior year quarter.

    Economic Consulting
    Revenues in the Economic Consulting segment increased $34.1 million, or 19.8%, to $206.1 million in the quarter compared to $172.0 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $30.3 million, or 17.6%, compared to the prior year quarter. The increase in revenues was primarily due to an increase in financial economics, non-merger and acquisition (“M&A”)-related antitrust and international arbitration revenues, which was partially offset by a decline in M&A-related antitrust revenues. Adjusted Segment EBITDA of $38.3 million, or 18.6% of segment revenues, compared to $27.3 million, or 15.9% 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 an increase in compensation, which includes the impact of an 8.1% increase in billable headcount, and higher SG&A expenses compared to the prior year quarter.

    Technology
    Revenues in the Technology segment increased $24.1 million, or 31.4%, to $100.9 million in the quarter compared to $76.8 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $23.1 million, or 30.1%, compared to the prior year quarter. The increase in revenues was primarily due to higher demand for M&A-related “second request” and litigation services. Adjusted Segment EBITDA of $12.4 million, or 12.3% of segment revenues, compared to $11.8 million, or 15.3% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was primarily due to higher revenues, which was largely offset by higher as-needed consultant costs, an increase in compensation, which includes the impact of a 12.9% increase in billable headcount, and higher SG&A expenses compared to the prior year quarter.

    Strategic Communications
    Revenues in the Strategic Communications segment increased $14.2 million, or 19.6%, to $86.6 million in the quarter compared to $72.4 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $12.2 million, or 16.9%, compared to the prior year quarter. The increase in revenues was primarily due to higher demand for corporate reputation and public affairs services. Adjusted Segment EBITDA of $15.6 million, or 18.0% of segment revenues, compared to $10.5 million, or 14.5% 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 an increase in compensation and higher SG&A expenses compared to the prior year quarter.

    2024 Guidance
    The Company estimates that revenues for full year 2024 will range between $3.650 billion and $3.790 billion. The Company estimates that EPS for full year 2024 will range between $7.75 and $8.50. The Company does not currently expect Adjusted EPS to differ from EPS.

    Fourth Quarter and Full Year 2023 Conference Call
    FTI Consulting will host a conference call for analysts and investors to discuss fourth quarter and full year 2023 financial results at 9:00 a.m. Eastern Time on Thursday, February 22, 2024. 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 7,900 employees located in 31 countries and territories, FTI Consulting professionals work closely with clients to anticipate, illuminate and overcome complex business challenges and make the most of opportunities. The Company generated $3.5 billion in revenues during fiscal year 2023. More information can be found at www.fticonsulting.com.

    Non-GAAP Financial 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 in the United States ("GAAP"). Certain of these financial measures are considered not in conformity with GAAP ("non-GAAP financial measures") under the United States Securities and Exchange Commission ("SEC") rules. Specifically, we have referred to the following non-GAAP financial measures:

    • Total Segment Operating Income
    • Adjusted EBITDA
    • Total Adjusted Segment EBITDA
    • Adjusted EBITDA Margin
    • Adjusted Net Income
    • Adjusted Earnings per Diluted Share

    We have included the definitions of Segment Operating Income and Adjusted Segment EBITDA, which are GAAP financial measures, below in order to more fully define the components of certain non-GAAP financial measures presented in this press 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 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, gain or loss on sale of a business and losses on early extinguishment of debt. We believe that these non-GAAP financial measures, when considered together with our GAAP financial results and GAAP financial 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 non-GAAP financial measures, considered along with corresponding GAAP financial measures, provide management and investors with additional information for comparison of our operating results with the operating results of other companies. We define Adjusted EBITDA Margin, which is a non-GAAP financial measure, as Adjusted EBITDA as a percentage of total revenues.

    We define Adjusted Net Income and Adjusted Earnings per Diluted Share ("Adjusted EPS"), which are non-GAAP financial measures, as net income and EPS, respectively, excluding the impact of remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges, losses on early extinguishment of debt, non-cash interest expense on convertible notes and the gain or loss on sale of a business. 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 these non-GAAP financial measures, when considered together with our GAAP financial results and GAAP financial measures, provide management and investors with an additional understanding of our business operating results, including underlying trends.

    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 and Condensed Consolidated Statements of Cash Flows. Reconciliations of these 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, initiatives, projections, prospects, policies, processes and practices, objectives, goals, commitments, strategies, future events, future revenues, future results and performance, expectations, plans or intentions relating to acquisitions, share repurchases and other matters, business trends, new or changes to laws and regulations, including U.S. and foreign tax laws, environmental, social and governance ("ESG")-related issues, climate change-related matters, scientific and technological developments, including relating to new and emerging technologies, such as Artificial Intelligence and machine learning, 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," "commits," "aspires," "forecasts," "future," "goal," "seeks" 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 plans, expectations, intentions, aspirations, beliefs, goals, estimates, forecasts and projections will result or be achieved. Our actual financial results, performance or achievements and outcomes could differ materially from those expressed in, or implied by, any forward-looking statements. Further, unaudited quarterly 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; the impact of public health crises and related events that are beyond our control, which could affect our segments, practices and the geographic regions in which we conduct business differently and adversely; and other future events, which could impact each of our segments, practices and the geographic regions in which we conduct business 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; 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, 2023 filed with the SEC on February 22, 2024 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.
    555 12th Street NW
    Washington, DC 20004
    +1.202.312.9100

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

    FTI CONSULTING, INC.
    CONSOLIDATED BALANCE SHEETS
    (in thousands, except per share amounts)
     
     December 31, December 31,
      2023   2022 
    Assets   
    Current assets   
    Cash and cash equivalents$303,222  $491,688 
    Accounts receivable, net 1,102,142   896,153 
    Current portion of notes receivable 30,997   27,292 
    Prepaid expenses and other current assets 119,092   95,469 
    Total current assets 1,555,453   1,510,602 
    Property and equipment, net 159,662   153,466 
    Operating lease assets 208,910   203,764 
    Goodwill 1,234,569   1,227,593 
    Intangible assets, net 18,285   25,514 
    Notes receivable, net 75,431   55,978 
    Other assets 73,568   64,490 
         Total assets$3,325,878  $3,241,407 
    Liabilities and Stockholders’ Equity   
    Current liabilities   
    Accounts payable, accrued expenses and other$223,758  $173,953 
    Accrued compensation 601,074   541,892 
    Billings in excess of services provided 67,937   53,646 
         Total current liabilities 892,769   769,491 
    Long-term debt, net    315,172 
    Noncurrent operating lease liabilities 223,774   221,604 
    Deferred income taxes 140,976   162,374 
    Other liabilities 86,939   91,045 
         Total liabilities 1,344,458   1,559,686 
    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 — 35,521 (2023) and 34,026 (2022)
     355   340 
    Additional paid-in capital 16,760    
    Retained earnings 2,114,765   1,858,103 
    Accumulated other comprehensive loss (150,460)  (176,722)
         Total stockholders’ equity 1,981,420   1,681,721 
              Total liabilities and stockholders’ equity$3,325,878  $3,241,407 
     


    FTI CONSULTING, INC.
    CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
    (in thousands, except per share data)
     
     Three Months Ended
    December 31,
      2023   2022 
     (Unaudited)
    Revenues$924,684  $774,431 
    Operating expenses   
    Direct cost of revenues 613,809   526,139 
    Selling, general and administrative expenses 194,634   164,973 
    Special charges    8,340 
    Amortization of intangible assets 1,220   2,323 
      809,663   701,775 
    Operating income 115,021   72,656 
    Other income (expense)   
    Interest income and other (8,088)  (6,500)
    Interest expense (3,896)  (2,579)
      (11,984)  (9,079)
    Income before income tax provision 103,037   63,577 
    Income tax provision 21,404   16,079 
    Net income$81,633  $47,498 
    Earnings per common share ― basic$2.34  $1.42 
    Weighted average common shares outstanding ― basic 34,889   33,552 
    Earnings per common share ― diluted$2.28  $1.33 
    Weighted average common shares outstanding ― diluted 35,778   35,658 
    Other comprehensive income, net of tax   
    Foreign currency translation adjustments, net of tax expense of $— and $—$28,244  $47,463 
    Total other comprehensive income, net of tax 28,244   47,463 
    Comprehensive income$109,877  $94,961 
     


    FTI CONSULTING, INC.
    CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
    (in thousands, except per share data)
     
     Year Ended December 31,
      2023   2022 
    Revenues$3,489,242  $3,028,908 
    Operating expenses   
    Direct cost of revenues 2,354,216   2,065,977 
    Selling, general and administrative expenses 751,306   641,070 
    Special charges    8,340 
    Amortization of intangible assets 6,159   9,643 
      3,111,681   2,725,030 
    Operating income 377,561   303,878 
    Other income (expense)   
    Interest income and other (4,867)  3,918 
    Interest expense (14,331)  (10,047)
      (19,198)  (6,129)
    Income before income tax provision 358,363   297,749 
    Income tax provision 83,471   62,235 
    Net income$274,892  $235,514 
    Earnings per common share ― basic$8.10  $6.99 
    Weighted average common shares outstanding ― basic 33,924   33,693 
    Earnings per common share ― diluted$7.71  $6.58 
    Weighted average common shares outstanding ― diluted 35,646   35,783 
    Other comprehensive income (loss), net of tax   
    Foreign currency translation adjustments, net of tax expense of $— and $—$26,262  $(47,882)
    Total other comprehensive income (loss), net of tax 26,262   (47,882)
    Comprehensive income$301,154  $187,632 
     


    FTI CONSULTING, INC.
    RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
    (in thousands, except per share data)
     
     Three Months Ended
    December 31,
     Year Ended
    December 31,
      
      2023  2022   2023  2022 
     (Unaudited)  
    Net income$81,633 $47,498  $274,892 $235,514 
    Add back:       
    Special charges   8,340     8,340 
    Tax impact of special charges   (1,584)    (1,584)
    Adjusted Net Income$81,633 $54,254  $274,892 $242,270 
    Earnings per common share — diluted$2.28 $1.33  $7.71 $6.58 
    Add back:       
    Special charges   0.23     0.23 
    Tax impact of special charges   (0.04)    (0.04)
    Adjusted earnings per common share — diluted$2.28 $1.52  $7.71 $6.77 
    Weighted average number of common shares
    outstanding ― diluted
     35,778  35,658   35,646  35,783 
     


    FTI CONSULTING, INC.
    RECONCILIATION OF NET INCOME AND OPERATING INCOME TO ADJUSTED EBITDA
    (in thousands)
     
    Three Months Ended December 31, 2023
    (Unaudited)
     Corporate Finance & Restructuring Forensic and Litigation Consulting Economic Consulting Technology  Strategic Communications Unallocated Corporate Total
    Net income             $81,633 
    Interest income and other              8,088 
    Interest expense              3,896 
    Income tax provision              21,404 
    Operating income  $61,779 $17,415 $36,801 $8,393 $14,703 $(24,070) $115,021 
    Depreciation and amortization  2,597  1,680  1,534  3,992  875  475   11,153 
    Amortization of intangible assets  1,010  152      58     1,220 
    Adjusted EBITDA $65,386 $19,247 $38,335 $12,385 $15,636 $(23,595) $127,394 
                   


    Year Ended December 31, 2023 Corporate Finance & Restructuring Forensic and Litigation Consulting Economic Consulting Technology Strategic Communications Unallocated Corporate Total
    Net income             $274,892 
    Interest income and other              4,867 
    Interest expense              14,331 
    Income tax provision              83,471 
    Operating income $216,504 $81,296 $109,818 $48,196 $47,167 $(125,420) $377,561 
    Depreciation and amortization  9,254  6,030  5,989  14,515  3,445  1,846   41,079 
    Amortization of intangible assets  5,079  783      297     6,159 
    Adjusted EBITDA $230,837 $88,109 $115,807 $62,711 $50,909 $(123,574) $424,799 
     


    FTI CONSULTING, INC.
    RECONCILIATION OF NET INCOME AND OPERATING INCOME TO ADJUSTED EBITDA
    (in thousands)
     
    Three Months Ended December 31, 2022
    (Unaudited)
     Corporate Finance & Restructuring (1) Forensic and Litigation Consulting (1) Economic Consulting Technology Strategic Communications Unallocated Corporate Total
    Net income             $        47,498         
    Interest income and other                      6,500         
    Interest expense                      2,579         
    Income tax provision                      16,079         
    Operating income $        43,008         $        11,047         $        26,122         $        8,425         $        9,360         $        (25,306) $        72,656         
    Depreciation and amortization          1,734                  1,206                  1,183                  3,226                  618                  688                   8,655         
    Amortization of intangible assets          1,940                  242                  —                  —                  141                  —                   2,323         
    Special charges          2,444                  4,614                  31                  106                  369                  776                   8,340         
    Adjusted EBITDA $        49,126         $        17,109         $        27,336         $        11,757         $        10,488         $        (23,842) $        91,974         
                   
     
    Year Ended December 31, 2022 Corporate Finance & Restructuring (1) Forensic and Litigation Consulting (1) Economic Consulting Technology Strategic Communications Unallocated Corporate Total
    Net income             $        235,514         
    Interest income and other                      (3,918)
    Interest expense                      10,047         
    Income tax provision                      62,235         
    Operating income $        197,424         $        52,693         $        98,178         $        33,431         $        46,982         $        (124,830) $        303,878         
    Depreciation and amortization          6,965                  5,289                  4,881                  13,161                  2,580                  2,821                   35,697         
    Amortization of intangible assets          7,976                  977                  —                  —                  689                  1                   9,643         
    Special charges          2,444                  4,614                  31                  106                  369                  776                   8,340         
    Adjusted EBITDA $        214,809         $        63,573         $        103,090         $        46,698         $        50,620         $        (121,232) $        357,558         
                            
    (1)  Effective July 1, 2023, prior period segment information for the Corporate Finance & Restructuring and Forensic and Litigation Consulting segments has been recast in this press release to include the reclassification of the portion of the Company’s health solutions practice in the Forensic and Litigation Consulting segment to the Company’s business transformation practice within the Corporate Finance & Restructuring segment.
     


    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 December 31, 2023 (Unaudited)            
    Corporate Finance & Restructuring$365,554 $65,386  17.9% 61% $503 2,215 
    Forensic and Litigation Consulting 165,469  19,247  11.6% 56% $391 1,447 
    Economic Consulting 206,091  38,335  18.6% 65% $586 1,089 
    Technology (1) 100,933  12,385  12.3% N/M N/M 628 
    Strategic Communications (1) 86,637  15,636  18.0% N/M N/M 971 
     $924,684 $150,989  16.3%     6,350 
    Unallocated Corporate   (23,595)         
    Adjusted EBITDA  $127,394  13.8%       
                 
    Year Ended December 31, 2023            
    Corporate Finance & Restructuring$1,346,678 $230,837  17.1% 60% $494 2,215 
    Forensic and Litigation Consulting 654,105  88,109  13.5% 57% $386 1,447 
    Economic Consulting 771,374  115,807  15.0% 67% $547 1,089 
    Technology (1) 387,855  62,711  16.2% N/M N/M 628 
    Strategic Communications (1) 329,230  50,909  15.5% N/M N/M 971 
     $3,489,242 $548,373  15.7%     6,350 
    Unallocated Corporate   (123,574)         
    Adjusted EBITDA  $424,799  12.2%       
                 
    Three Months Ended December 31, 2022 (Unaudited)            
    Corporate Finance & Restructuring (2)$305,314 $49,126  16.1% 56% $478 2,100 
    Forensic and Litigation Consulting (2) 147,879  17,109  11.6% 53% $370 1,430 
    Economic Consulting 172,007  27,336  15.9% 63% $522 1,007 
    Technology (1) 76,802  11,757  15.3% N/M N/M 556 
    Strategic Communications (1) 72,429  10,488  14.5% N/M N/M 970 
     $774,431 $115,816  15.0%     6,063 
    Unallocated Corporate   (23,842)         
    Adjusted EBITDA  $91,974  11.9%       
                 
    Year Ended December 31, 2022            
    Corporate Finance & Restructuring (2)$1,147,118 $214,809  18.7% 60% $456 2,100 
    Forensic and Litigation Consulting (2) 579,933  63,573  11.0% 54% $359 1,430 
    Economic Consulting 695,208  103,090  14.8% 68% $508 1,007 
    Technology (1) 319,983  46,698  14.6% N/M N/M 556 
    Strategic Communications (1) 286,666  50,620  17.7% N/M N/M 970 
     $3,028,908 $478,790  15.8%     6,063 
    Unallocated Corporate   (121,232)         
    Adjusted EBITDA  $357,558  11.8%       
                 
    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.
    (2)  Effective July 1, 2023, prior period segment information for the Corporate Finance & Restructuring and Forensic and Litigation Consulting segments has been recast in this press release to include the reclassification of the portion of the Company’s health solutions practice in the Forensic and Litigation Consulting segment to the Company’s business transformation practice within the Corporate Finance & Restructuring segment.
     


    FTI CONSULTING, INC.
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in thousands)
     
       Year Ended December 31,
       2023   2022 
    Operating activities    
    Net income $274,892  $235,514 
    Adjustments to reconcile net income to net cash provided by operating activities:    
    Depreciation and amortization  41,079   35,898 
    Amortization of intangible assets  6,159   9,643 
    Acquisition-related contingent consideration  3,818   2,172 
    Provision for expected credit losses  35,149   19,684 
    Share-based compensation  29,534   25,414 
    Amortization of debt issuance costs and other  1,925   2,224 
    Deferred income taxes  (25,453)  (10,456)
    Changes in operating assets and liabilities, net of effects from acquisitions:    
    Accounts receivable, billed and unbilled  (229,296)  (182,667)
    Notes receivable  (22,919)  (403)
    Prepaid expenses and other assets  7,606   459 
    Accounts payable, accrued expenses and other  8,687   8,430 
    Income taxes  29,335   (4,322)
    Accrued compensation  50,186   37,931 
    Billings in excess of services provided  13,759   9,273 
     Net cash provided by operating activities 224,461   188,794 
    Investing activities    
    Payments for acquisition of businesses, net of cash received     (6,742)
    Purchases of property and equipment and other  (49,479)  (53,319)
    Purchase of short-term investment  (24,356)   
     Net cash used in investing activities (73,835)  (60,061)
    Financing activities    
    Borrowings under revolving line of credit  835,000   165,000 
    Repayments under revolving line of credit  (835,000)  (165,000)
    Payments of debt issuance costs     (3,993)
    Repayment of convertible notes  (315,763)   
    Purchase and retirement of common stock  (20,982)  (85,424)
    Share-based compensation tax withholdings and other  (15,078)  (15,330)
    Payments for business acquisition liabilities  (3,651)  (4,848)
    Deposits and other  811   3,583 
     Net cash used in financing activities (354,663)  (106,012)
    Effect of exchange rate changes on cash and cash equivalents  15,571   (25,518)
    Net decrease in cash and cash equivalents  (188,466)  (2,797)
    Cash and cash equivalents, beginning of period  491,688   494,485 
    Cash and cash equivalents, end of period $303,222  $491,688 
     

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