UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
_____________________
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
October 31,
2007
Date of
Report (Date of earliest event reported)
_____________________
Huron
Consulting Group Inc.
(Exact
name of registrant as specified in its charter)
|
Delaware |
000-50976 |
01-0666114 |
|
(State
or other jurisdiction |
(Commission |
(IRS
Employer |
|
of
incorporation or organization) |
File Number) |
Identification
Number) |
550
West Van Buren Street
Chicago,
Illinois
60607
(Address
of principal executive offices)
(Zip
Code)
(312)
583-8700
(Registrant’s
telephone number, including area code)
_____________________
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
2.02. Results
of Operations and Financial Condition.
On
October 31, 2007, Huron Consulting Group Inc. issued a press release
announcing its financial results for the three and nine months ended
September 30, 2007. A copy of the press release is furnished as Exhibit
99.1 to this Current Report on Form 8-K and is incorporated in this report as if
fully set forth herein.
Item
9.01. Financial
Statements and Exhibits.
|
(d) |
Exhibits | |
|
99.1 Press
release, dated October 31, 2007 |
- 1
- -
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
Huron
Consulting Group Inc. | |||
|
(Registrant) | |||
|
Date: |
October
31, 2007 |
/s/
Gary L. Burge | |
|
Gary
L. Burge | |||
|
Vice
President, | |||
|
Chief
Financial Officer and Treasurer |
- 2
- -
EXHIBIT
INDEX
|
Exhibit
Number |
Description | |
|
99.1
|
Press
release, dated October 31, 2007
|
EXHIBIT
99.1
[Huron
Consulting Group Logo]
News
FOR
IMMEDIATE RELEASE
October
31, 2007
Huron
Consulting Group Reports Third Quarter 2007 Financial
Results
| · |
Revenues
of $134.1 million for Q3 2007 increased 78.3% from $75.2 million in Q3
2006. |
| · |
Revenues
of $368.3 million for the nine months ended September 30, 2007 increased
79.5% from $205.2 million in the same period last year.
|
| · |
Diluted
earnings per share for Q3 2007 were $0.58 compared to $0.39 in Q3
2006. |
| · |
Average
number of full-time billable consultants totaled 1,048 for Q3 2007
compared to 719 for Q3 2006. Average number of full-time equivalent
professionals(4)
totaled 622 for Q3 2007 compared to 184 in the same period last
year. |
CHICAGO -
October 31, 2007 - Huron Consulting Group Inc. (NASDAQ: HURN), a leading
provider of financial and operational consulting services, today announced
financial results for the third quarter and nine months ended September 30,
2007.
"Huron
continued its strong growth in the quarter, and we again proved the value of our
balanced portfolio of service offerings. The strength of our Healthcare and
Education Consulting and Legal Consulting businesses were excellent this
quarter. We are also optimistic about the continued growth prospects for our
Financial Consulting business with the acquisition of Callaway Partners this
quarter and we think our Corporate Consulting business has great potential,"
said Gary E. Holdren, chairman and chief executive officer, Huron Consulting
Group.
“We are
seeing opportunities across all our businesses in what is a very large
consulting marketplace. By being able to attract and retain the right people
focused on delivering superior client service, Huron is well positioned for
long-term growth,” added Holdren.
Third
Quarter 2007 Results
Revenues
of $134.1 million for the third quarter of 2007 increased 78.3% from
$75.2 million for the third quarter of 2006. The Company's third quarter
2007 operating income increased 80.0% to $21.8 million compared to $12.1 million
in the third quarter of 2006. Net income was $10.5 million, or $0.58 per diluted
share, for the third quarter of 2007 compared to $6.8 million, or $0.39 per
diluted share, for the same quarter last year. Financial results for the third
quarter of 2007 and 2006 included $2.2 million and $0.4 million,
respectively, of rapid amortization on intangible assets.
Third
quarter 2007 earnings before interest, taxes, depreciation and amortization
(“EBITDA”)(5)
increased 82.6% to $28.3 million, or 21.1% of revenues, compared to $15.5
million, or 20.6% of revenues, in the comparable quarter last year. Adjusted
EBITDA(5), which
excludes share-based compensation expense, increased 86.0% to $33.5 million in
the third quarter of 2007, or 25.0% of revenues, compared to $18.0 million, or
24.0% of revenues, in the comparable quarter last year.
The
average number of full-time billable consultants increased 45.8% to 1,048 in the
third quarter of 2007 compared to 719 in the same quarter last year. Huron also
has a number of variable, on-demand consultants, contract reviewers and other
professionals who generate revenues based on units produced, such as pages
reviewed and data processed. The average number of full-time equivalent
professionals(4)
increased 238.0% to 622 in the third quarter of 2007 compared to 184 for the
comparable period in 2006. Full-time billable consultant utilization rate was
73.9% during the third quarter of 2007 compared with 78.9% during the same
period last year. Average billing rate per hour for full-time billable
consultants increased 10.0% to $286 for the third quarter of 2007 from $260 for
the third quarter of 2006.
Year-to-Date
Results
Revenues
of $368.3 million for the nine months ended September 30, 2007 increased 79.5%
from $205.2 million for the same period last year. The Company's operating
income increased 82.8% to $60.5 million for the nine months ended September 30,
2007 compared to $33.1 million the same period last year. Net income was $30.4
million, or $1.69 per diluted share, for the nine months ended September 30,
2007 compared to $18.7 million, or $1.08 per diluted share, for the
comparable period last year. Financial results for the first nine months of 2007
and 2006 included $6.7 million and $2.1 million, respectively, of
rapid amortization of intangible assets.
Year-to-date
2007 EBITDA(5)
increased 93.2% to $79.8 million, or 21.7% of revenues, compared to
$41.3 million, or 20.1% of revenues, in the same period last year. Adjusted
EBITDA(5), which
excludes share-based compensation expense and costs associated with a secondary
offering of the Company's common stock in the first quarter of 2006, increased
91.5% to $94.0 million in the first nine months of 2007, or 25.5% of revenues,
compared to $49.1 million, or 23.9% of revenues, in the comparable period last
year.
Full-time
billable consultant utilization rate was 76.5% during the first nine months of
2007 compared with 77.7% during the same period last year. Average billing rate
per hour for full-time billable consultants increased 6.1% to $279 for the first
nine months of 2007 from $263 in the same period last year.
New
Operating Segments for 2007
Huron
continues to demonstrate the success of its broad portfolio of service offerings
with solid revenue growth based upon strong market demand.
In
response to Huron's continued organic growth and acquisitions of complementary
businesses, the Company has reorganized its practice areas and service lines,
effective January 1, 2007, to better meet market demand and serve clients.
Under the new organizational structure, Huron has four operating segments as
follows: Financial Consulting; Legal Consulting; Health and Education
Consulting; and Corporate Consulting.
Segment
results are included in the attached schedules and in Huron's Form 10-Q filing
for the quarter ended September 30, 2007.
Acquisitions
In
January 2007, Huron acquired Wellspring Partners LTD, a leading management
consulting firm specializing in integrated performance improvement services for
hospitals and health systems, and Glass & Associates, Inc., a leading
turnaround and restructuring firm.
In July
2007, Huron acquired Callaway Partners, LLC, an accounting and finance
professional services firm. Callaway specializes in project management and staff
augmentation for clients, focusing on general accounting/finance support,
accounting and SEC reporting advisory services, internal audit, Sarbanes-Oxley
compliance and corporate tax solutions.
Outlook
for 2007
Based on
currently available information, the Company expects Q4 2007 revenues before
reimbursable expenses in a range of $135.0 million to $138.0 million, EBITDA in
a range of $28.0 million to $29.5 million, operating income in a range of $22.5
million to $23.5 million, and between $0.61 and $0.65 in diluted earnings per
share.
The
Company anticipates full year 2007 revenues before reimbursable expenses in a
range of $503.0 million to $506.0 million, EBITDA in a range of $107.5 million
to $109.0 million, operating income in a range of $83.0 million to $84.0
million, and between $2.30 and $2.34 in diluted earnings per share.
Third
Quarter 2007 Webcast
The
Company will host a webcast to discuss its financial results today at 11:00 a.m.
Eastern Time (10:00 a.m. Central Time). The webcast may be accessed at
www.huronconsultinggroup.com . A
rebroadcast will be available approximately two hours after the end of the
webcast and for 90 days thereafter.
About
Huron Consulting Group
Huron
Consulting Group helps clients effectively address complex challenges that arise
in litigation, disputes, investigations, regulatory compliance, procurement,
financial distress, and other sources of significant conflict or change. The
Company also helps clients deliver superior customer and capital market
performance through integrated strategic, operational, and organizational
change. Huron provides services to a wide variety of both financially sound and
distressed organizations, including Fortune 500 companies, medium-sized
businesses, leading academic institutions, healthcare organizations, and the law
firms that represent these various organizations. Learn more at
www.huronconsultinggroup.com
..
Statements
in this press release that are not historical in nature and concern Huron
Consulting Group's current expectations about the Company's reported results for
2007 and future results in 2007 are "forward-looking" statements as defined in
Section 21E of the Securities Exchange Act of 1934 and the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are identified by
words such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,”
“estimates,” or “continue.” These forward-looking statements reflect our current
expectation about our future results, levels of activity, performance or
achievements, including without limitation, that our business continues to grow
at the current expectations with respect to, among other factors, utilization
and billing rates, number of revenue-generating professionals; that we are able
to expand our service offerings; that we successfully integrate the businesses
we acquire; and that existing market conditions do not change from current
expectations. These statements involve known and unknown risks, uncertainties
and other factors that may cause actual results, levels of activity, performance
or achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these
forward-looking statements. Therefore you should not place undue reliance on
these forward-looking statements. Please see “Risk Factors” in our 2006 annual
report on Form 10-K and in other documents we file with the Securities and
Exchange Commission for a complete description of the material risks we
face.
Media
Contact:
Jennifer
Frost Hennagir
312-880-3260
jfrost-hennagir@huronconsultinggroup.com
Investor
Contact:
Gary L.
Burge, Chief Financial Officer
312-583-8722
garyburge@huronconsultinggroup.com
###
HURON
CONSULTING GROUP INC.
CONSOLIDATED
STATEMENTS OF INCOME
(In
thousands, except per share amounts)
(Unaudited)
|
Three
months ended
September 30, |
Nine
months ended
September 30, |
||||||||||||
|
2007 |
2006 |
2007 |
2006 |
||||||||||
Revenues
and reimbursable expenses: |
|||||||||||||
Revenues |
$ |
134,051 |
$ |
75,194 |
$ |
368,326 |
$ |
205,150 |
|||||
|
Reimbursable
expenses |
11,286 |
7,921 |
32,231 |
20,051 |
|||||||||
Total
revenues and reimbursable expenses |
145,337 |
83,115 |
400,557 |
225,201 |
|||||||||
Direct
costs and reimbursable expenses (exclusive
of depreciation
and amortization
shown in operating expenses): |
|||||||||||||
Direct
costs |
80,237 |
42,973 |
213,648 |
116,399 |
|||||||||
Intangible
assets amortization |
2,208 |
467 |
6,752 |
2,183 |
|||||||||
|
Reimbursable
expenses |
11,108 |
7,907 |
32,039 |
20,240 |
|||||||||
|
Total
direct costs and reimbursable expenses |
93,553 |
51,347 |
252,439 |
138,822 |
|||||||||
Operating
expenses: |
|||||||||||||
Selling,
general and administrative |
25,675 |
16,724 |
75,108 |
47,278 |
|||||||||
|
Depreciation
and amortization |
4,283 |
2,921 |
12,502 |
5,998 |
|||||||||
|
Total
operating expenses |
29,958 |
19,645 |
87,610 |
53,276 |
|||||||||
Operating
income |
21,826 |
12,123 |
60,508 |
33,103 |
|||||||||
Other
income (expense): |
|||||||||||||
Interest
income (expense), net |
(2,621 |
) |
(404 |
) |
(5,871 |
) |
(365 |
) | |||||
|
Other
income |
11 |
¾ |
136 |
¾ |
|||||||||
|
Total
other expense |
(2,610 |
) |
(404 |
) |
(5,735 |
) |
(365 |
) | |||||
Income
before provision for income taxes |
19,216 |
11,719 |
54,773 |
32,738 |
|||||||||
|
Provision
for income taxes |
8,729 |
4,934 |
24,374 |
14,077 |
|||||||||
|
Net
income |
$ |
10,487 |
$ |
6,785 |
$ |
30,399 |
$ |
18,661 |
|||||
Earnings
per share: |
|||||||||||||
Basic |
$ |
0.61 |
$ |
0.41 |
$ |
1.80 |
$ |
1.15 |
|||||
Diluted |
$ |
0.58 |
$ |
0.39 |
$ |
1.69 |
$ |
1.08 |
|||||
Weighted
average shares used in calculating earnings per share: |
|||||||||||||
Basic |
17,033 |
16,424 |
16,868 |
16,272 |
|||||||||
Diluted |
18,137 |
17,415 |
17,967 |
17,220 |
|||||||||
HURON
CONSULTING GROUP INC.
CONSOLIDATED
BALANCE SHEETS
(In
thousands, except share and per share amounts)
(Unaudited)
|
September
30,
2007 |
December
31,
2006 |
||||||
Assets |
|||||||
Current
assets: |
|||||||
Cash
and cash equivalents |
$ |
3,742 |
$ |
16,572 |
|||
Receivables
from clients, net |
86,157 |
41,848 |
|||||
Unbilled
services, net |
41,116 |
22,627 |
|||||
Income
tax receivable |
4,097 |
3,637 |
|||||
Deferred
income taxes |
24,674 |
15,290 |
|||||
|
Other
current assets |
9,025 |
6,435 |
|||||
Total
current assets |
168,811 |
106,409 |
|||||
Property
and equipment,
net |
33,764 |
27,742 |
|||||
Deferred
income taxes |
3,786 |
5,433 |
|||||
Deposits
and other assets |
7,503 |
2,294 |
|||||
Intangible
assets, net |
16,117 |
4,238 |
|||||
|
Goodwill |
190,780 |
53,328 |
|||||
|
Total
assets |
$ |
420,761 |
$ |
199,444 |
|||
Liabilities
and stockholders’ equity |
|||||||
Current
liabilities: |
|||||||
Accounts
payable |
$ |
3,937 |
$ |
2,684 |
|||
Accrued
expenses |
26,011 |
12,712 |
|||||
Accrued
payroll and related benefits |
52,661 |
41,649 |
|||||
Income
tax payable |
140 |
¾ |
|||||
Deferred
revenues |
4,466 |
4,035 |
|||||
Bank
borrowings |
¾ |
8,000 |
|||||
|
Current
portion of notes payable and capital lease obligations |
1,143 |
1,282 |
|||||
Total
current liabilities |
88,358 |
70,362 |
|||||
Non-current
liabilities: |
|||||||
Deferred
compensation and other liabilities |
3,145 |
1,169 |
|||||
Notes
payable and capital lease obligations, net of current portion |
¾ |
1,000 |
|||||
Bank
borrowings |
154,500 |
¾ |
|||||
|
Deferred
lease incentives |
9,934 |
10,333 |
|||||
Total
non-current liabilities |
167,579 |
12,502 |
|||||
Commitments
and contingencies |
|||||||
Stockholders’
equity |
|||||||
Common
stock; $0.01 par value; 500,000,000 shares authorized; 19,216,491
and
18,470,623 shares issued at September 30, 2007 and
December 31, 2006,
respectively |
182 |
178 |
|||||
Treasury
stock, at cost, 522,688 and 398,783 shares at September 30, 2007
and
December 31, 2006, respectively |
(16,094 |
) |
(9,396 |
) | |||
Additional
paid-in capital |
104,112 |
79,598 |
|||||
Retained
earnings |
76,599 |
46,200 |
|||||
|
Accumulated
other comprehensive income |
25 |
¾ |
|||||
|
Total
stockholders’ equity |
164,824 |
116,580 |
|||||
|
Total
liabilities and stockholders’ equity |
$ |
420,761 |
$ |
199,444 |
|||
HURON
CONSULTING GROUP INC.
SEGMENT
OPERATING RESULTS AND OTHER OPERATING DATA
(Unaudited)
|
Three
Months Ended
September 30, |
Percent
Increase (Decrease) |
|||||||||
|
Segment
and Consolidated Operating Results (in
thousands): |
2007 |
2006 |
||||||||
Revenues
and reimbursable expenses: |
||||||||||
Financial
Consulting |
$ |
39,983 |
$ |
28,618 |
39.7 |
% | ||||
Legal
Consulting |
23,346 |
12,971 |
80.0 |
% | ||||||
Health
and Education Consulting |
49,767 |
21,088 |
136.0 |
% | ||||||
|
Corporate
Consulting |
20,955 |
12,517 |
67.4 |
% | ||||||
Total
revenues |
134,051 |
75,194 |
78.3 |
% | ||||||
|
Total
reimbursable expenses |
11,286 |
7,921 |
42.5 |
% | ||||||
|
Total
revenues and reimbursable expenses |
$ |
145,337 |
$ |
83,115 |
74.9 |
% | ||||
Operating
income: |
||||||||||
Financial
Consulting |
$ |
11,656 |
$ |
13,033 |
(10.6 |
%) | ||||
Legal
Consulting |
7,243 |
3,650 |
98.4 |
% | ||||||
Health
and Education Consulting |
18,783 |
6,592 |
184.9 |
% | ||||||
|
Corporate
Consulting |
7,036 |
4,955 |
42.0 |
% | ||||||
Total
segment operating income |
44,718 |
28,230 |
58.4 |
% | ||||||
|
Operating
expenses not allocated to segments |
22,892 |
16,107 |
42.1 |
% | ||||||
|
Total
operating income |
$ |
21,826 |
$ |
12,123 |
80.0 |
% | ||||
|
Other
Operating Data: |
||||||||||
Number
of full-time billable consultants (at period end)
(1): |
||||||||||
Financial
Consulting |
358 |
258 |
38.8 |
% | ||||||
Legal
Consulting |
165 |
118 |
39.8 |
% | ||||||
Health
and Education Consulting |
417 |
257 |
62.3 |
% | ||||||
|
Corporate
Consulting |
218 |
131 |
66.4 |
% | ||||||
Total |
1,158 |
764 |
51.6 |
% | ||||||
Average
number of full-time billable consultants (for the period)
(1): |
||||||||||
Financial
Consulting |
321 |
244 |
||||||||
Legal
Consulting |
143 |
115 |
||||||||
Health
and Education Consulting |
390 |
237 |
||||||||
|
Corporate
Consulting |
194 |
123 |
||||||||
Total |
1,048 |
719 |
||||||||
Full-time
billable consultant utilization rate (2): |
||||||||||
Financial
Consulting |
68.7 |
% |
82.9 |
% |
||||||
Legal
Consulting |
74.6 |
% |
71.8 |
% |
||||||
Health
and Education Consulting |
80.2 |
% |
82.3 |
% |
||||||
Corporate
Consulting |
69.6 |
% |
71.8 |
% |
||||||
Total |
73.9 |
% |
78.9 |
% |
||||||
Full-time
billable consultant average billing rate per hour (3): |
||||||||||
Financial
Consulting |
$ |
276 |
$ |
280 |
||||||
Legal
Consulting |
$ |
243 |
$ |
227 |
||||||
Health
and Education Consulting |
$ |
292 |
$ |
228 |
||||||
Corporate
Consulting |
$ |
315 |
$ |
309 |
||||||
Total |
$ |
286 |
$ |
260 |
||||||
Revenue
per full-time billable consultant (in thousands): |
||||||||||
Financial
Consulting |
$ |
86 |
$ |
113 |
||||||
Legal
Consulting |
$ |
79 |
$ |
74 |
||||||
Health
and Education Consulting |
$ |
110 |
$ |
85 |
||||||
Corporate
Consulting |
$ |
106 |
$ |
101 |
||||||
Total |
$ |
98 |
$ |
95 |
||||||
HURON
CONSULTING GROUP INC.
SEGMENT
OPERATING RESULTS AND OTHER OPERATING DATA (CONTINUED)
(Unaudited)
|
Three
Months Ended
September 30, |
Percent
Increase (Decrease) |
|||||||||
|
Other
Operating Data: |
2007 |
2006 |
||||||||
Average
number of full-time equivalents (for the period) (4): |
||||||||||
Financial
Consulting |
210 |
10 |
N/M |
|||||||
Legal
Consulting |
342 |
162 |
111.1 |
% | ||||||
Health
and Education Consulting |
65 |
10 |
N/M |
|||||||
|
Corporate
Consulting |
5 |
2 |
150.0 |
% | ||||||
Total |
622 |
184 |
238.0 |
% | ||||||
Revenue
per full-time equivalents (in thousands): |
||||||||||
Financial
Consulting |
$ |
59 |
$ |
110 |
||||||
Legal
Consulting |
$ |
35 |
$ |
27 |
||||||
Health
and Education Consulting |
$ |
104 |
$ |
89 |
||||||
Corporate
Consulting |
$ |
76 |
$ |
59 |
||||||
Total |
$ |
51 |
$ |
36 |
||||||
HURON
CONSULTING GROUP INC.
SEGMENT
OPERATING RESULTS AND OTHER OPERATING DATA (CONTINUED)
(Unaudited)
|
Nine
Months Ended
September 30, |
Percent
Increase |
|||||||||
|
Segment
and Consolidated Operating Results (in
thousands): |
2007 |
2006 |
||||||||
Revenues
and reimbursable expenses: |
||||||||||
Financial
Consulting |
$ |
109,264 |
$ |
78,648 |
38.9 |
% | ||||
Legal
Consulting |
69,412 |
29,740 |
133.4 |
% | ||||||
Health
and Education Consulting |
131,429 |
60,228 |
118.2 |
% | ||||||
|
Corporate
Consulting |
58,221 |
36,534 |
59.4 |
% | ||||||
Total
revenues |
368,326 |
205,150 |
79.5 |
% | ||||||
|
Total
reimbursable expenses |
32,231 |
20,051 |
60.7 |
% | ||||||
|
Total
revenues and reimbursable expenses |
$ |
400,557 |
$ |
225,201 |
77.9 |
% | ||||
Operating
income: |
||||||||||
Financial
Consulting |
$ |
43,112 |
$ |
35,922 |
20.0 |
% | ||||
Legal
Consulting |
22,417 |
8,437 |
165.7 |
% | ||||||
Health
and Education Consulting |
45,004 |
18,315 |
145.7 |
% | ||||||
|
Corporate
Consulting |
17,152 |
13,176 |
30.2 |
% | ||||||
Total
segment operating income |
127,685 |
75,850 |
68.3 |
% | ||||||
|
Operating
expenses not allocated to segments |
67,177 |
42,747 |
57.2 |
% | ||||||
|
Total
operating income |
$ |
60,508 |
$ |
33,103 |
82.8 |
% | ||||
|
Other
Operating Data: |
||||||||||
Number
of full-time billable consultants (at period end)
(1): |
||||||||||
Financial
Consulting |
358 |
258 |
38.8 |
% | ||||||
Legal
Consulting |
165 |
118 |
39.8 |
% | ||||||
Health
and Education Consulting |
417 |
257 |
62.3 |
% | ||||||
|
Corporate
Consulting |
218 |
131 |
66.4 |
% | ||||||
Total |
1,158 |
764 |
51.6 |
% | ||||||
Average
number of full-time billable consultants (for the period)
(1): |
||||||||||
Financial
Consulting |
298 |
231 |
||||||||
Legal
Consulting |
129 |
111 |
||||||||
Health
and Education Consulting |
367 |
219 |
||||||||
|
Corporate
Consulting |
182 |
113 |
||||||||
Total |
976 |
674 |
||||||||
Full-time
billable consultant utilization rate (2): |
||||||||||
Financial
Consulting |
75.8 |
% |
80.2 |
% |
||||||
Legal
Consulting |
76.3 |
% |
71.5 |
% |
||||||
Health
and Education Consulting |
79.7 |
% |
80.2 |
% |
||||||
Corporate
Consulting |
71.6 |
% |
73.9 |
% |
||||||
Total |
76.5 |
% |
77.7 |
% |
||||||
Full-time
billable consultant average billing rate per hour (3): |
||||||||||
Financial
Consulting |
$ |
295 |
$ |
287 |
||||||
Legal
Consulting |
$ |
243 |
$ |
230 |
||||||
Health
and Education Consulting |
$ |
266 |
$ |
228 |
||||||
Corporate
Consulting |
$ |
307 |
$ |
317 |
||||||
Total |
$ |
279 |
$ |
263 |
||||||
Revenue
per full-time billable consultant (in thousands): |
||||||||||
Financial
Consulting |
$ |
318 |
$ |
332 |
||||||
Legal
Consulting |
$ |
242 |
$ |
226 |
||||||
Health
and Education Consulting |
$ |
301 |
$ |
260 |
||||||
Corporate
Consulting |
$ |
312 |
$ |
322 |
||||||
Total |
$ |
301 |
$ |
289 |
||||||
HURON
CONSULTING GROUP INC.
SEGMENT
OPERATING RESULTS AND OTHER OPERATING DATA (CONTINUED)
(Unaudited)
|
Nine
Months Ended
September 30, |
Percent
Increase |
|||||||||
|
Other
Operating Data: |
2007 |
2006 |
||||||||
Average
number of full-time equivalents (for the period) (4): |
||||||||||
Financial
Consulting |
75 |
6 |
N/M |
|||||||
Legal
Consulting |
358 |
56 |
N/M |
|||||||
Health
and Education Consulting |
62 |
12 |
416.7 |
% | ||||||
|
Corporate
Consulting |
5 |
1 |
400.0 |
% | ||||||
Total |
500 |
75 |
N/M |
|||||||
Revenue
per full-time equivalents (in thousands): |
||||||||||
Financial
Consulting |
$ |
193 |
$ |
332 |
||||||
Legal
Consulting |
$ |
107 |
$ |
84 |
||||||
Health
and Education Consulting |
$ |
335 |
$ |
268 |
||||||
Corporate
Consulting |
$ |
299 |
$ |
171 |
||||||
Total |
$ |
150 |
$ |
134 |
||||||
HURON
CONSULTING GROUP INC.
SEGMENT
OPERATING RESULTS AND OTHER OPERATING DATA (CONTINUED)
(Unaudited)
|
Three
Months Ended |
|||||||||||||||||||
|
Segment
and Consolidated Operating
Results
(in thousands): |
Mar. 31,
2006 |
Jun. 30,
2006 |
Sep. 30,
2006 |
Dec. 31,
2006 |
Mar. 31,
2007 |
Jun. 30,
2007 |
|||||||||||||
Revenues
and reimbursable expenses: |
|||||||||||||||||||
Financial
Consulting |
$ |
26,049 |
$ |
23,981 |
$ |
28,618 |
$ |
30,572 |
$ |
36,612 |
$ |
32,669 |
|||||||
Legal
Consulting |
7,550 |
9,219 |
12,971 |
18,034 |
23,271 |
22,795 |
|||||||||||||
Health
and Education Consulting |
18,424 |
20,716 |
21,088 |
23,880 |
38,852 |
42,810 |
|||||||||||||
|
Corporate
Consulting |
10,164 |
13,853 |
12,517 |
10,952 |
17,274 |
19,992 |
|||||||||||||
Total
revenues |
62,187 |
67,769 |
75,194 |
83,438 |
116,009 |
118,266 |
|||||||||||||
|
Total
reimbursable expenses |
5,439 |
6,691 |
7,921 |
13,279 |
10,035 |
10,910 |
|||||||||||||
|
Total
revenues and reimbursable expenses |
$ |
67,626 |
$ |
74,460 |
$ |
83,115 |
$ |
96,717 |
$ |
126,044 |
$ |
129,176 |
|||||||
Operating
income: |
|||||||||||||||||||
Financial
Consulting |
$ |
11,703 |
$ |
11,186 |
$ |
13,033 |
$ |
14,382 |
$ |
16,175 |
$ |
15,281 |
|||||||
Legal
Consulting |
2,157 |
2,630 |
3,650 |
5,447 |
7,902 |
7,272 |
|||||||||||||
Health
and Education Consulting |
5,288 |
6,435 |
6,592 |
7,060 |
12,200 |
14,021 |
|||||||||||||
|
Corporate
Consulting |
3,607 |
4,614 |
4,955 |
4,640 |
4,196 |
5,920 |
|||||||||||||
Total
segment operating income |
22,755 |
24,865 |
28,230 |
31,529 |
40,473 |
42,494 |
|||||||||||||
|
Operating
expenses not allocated to segments |
13,082 |
13,558 |
16,107 |
17,123 |
21,558 |
22,727 |
|||||||||||||
|
Total
operating income |
$ |
9,673 |
$ |
11,307 |
$ |
12,123 |
$ |
14,406 |
$ |
18,915 |
$ |
19,767 |
|||||||
|
Other
Operating Data: |
|||||||||||||||||||
Number
of full-time billable consultants
(at
period end)
(1): |
|||||||||||||||||||
Financial
Consulting |
224 |
225 |
258 |
268 |
281 |
291 |
|||||||||||||
Legal
Consulting |
109 |
112 |
118 |
121 |
121 |
126 |
|||||||||||||
Health
and Education Consulting |
207 |
220 |
257 |
274 |
352 |
355 |
|||||||||||||
|
Corporate
Consulting |
96 |
113 |
131 |
131 |
170 |
168 |
|||||||||||||
Total |
636 |
670 |
764 |
794 |
924 |
940 |
|||||||||||||
Average
number of full-time billable
consultants
(for the period) (1): |
|||||||||||||||||||
Financial
Consulting |
223 |
223 |
244 |
260 |
280 |
288 |
|||||||||||||
Legal
Consulting |
103 |
110 |
115 |
120 |
121 |
122 |
|||||||||||||
Health
and Education Consulting |
212 |
211 |
237 |
265 |
345 |
356 |
|||||||||||||
|
Corporate
Consulting |
101 |
111 |
123 |
132 |
173 |
170 |
|||||||||||||
Total |
639 |
655 |
719 |
777 |
919 |
936 |
|||||||||||||
Full-time
billable consultant
utilization
rate (2): |
|||||||||||||||||||
Financial
Consulting |
83.9 |
% |
73.4 |
% |
82.9 |
% |
85.6 |
% |
85.0 |
% |
74.6 |
% | |||||||
Legal
Consulting |
67.7 |
% |
74.6 |
% |
71.8 |
% |
72.5 |
% |
75.5 |
% |
79.0 |
% | |||||||
Health
and Education Consulting |
78.1 |
% |
80.2 |
% |
82.3 |
% |
77.0 |
% |
78.3 |
% |
80.5 |
% | |||||||
Corporate
Consulting |
71.6 |
% |
78.5 |
% |
71.8 |
% |
69.4 |
% |
68.4 |
% |
77.1 |
% | |||||||
Total |
77.5 |
% |
76.7 |
% |
78.9 |
% |
77.9 |
% |
78.1 |
% |
77.9 |
% | |||||||
Full-time
billable consultant average
billing
rate per hour (3): |
|||||||||||||||||||
Financial
Consulting |
$ |
283 |
$ |
299 |
$ |
280 |
$ |
282 |
$ |
298 |
311 |
||||||||
Legal
Consulting |
$ |
225 |
$ |
236 |
$ |
227 |
$ |
238 |
$ |
238 |
247 |
||||||||
Health
and Education Consulting |
$ |
221 |
$ |
236 |
$ |
228 |
$ |
239 |
$ |
248 |
255 |
||||||||
Corporate
Consulting |
$ |
296 |
$ |
341 |
$ |
309 |
$ |
280 |
$ |
293 |
311 |
||||||||
Total |
$ |
256 |
$ |
274 |
$ |
260 |
$ |
261 |
$ |
271 |
281 |
||||||||
HURON
CONSULTING GROUP INC.
SEGMENT
OPERATING RESULTS AND OTHER OPERATING DATA (CONTINUED)
(Unaudited)
|
Three
Months Ended |
|||||||||||||||||||
|
Other
Operating Data: |
Mar. 31,
2006 |
Jun. 30,
2006 |
Sep. 30,
2006 |
Dec. 31,
2006 |
Mar. 31,
2007 |
Jun. 30,
2007 |
|||||||||||||
Revenue
per full-time billable consultant
(in
thousands): |
|||||||||||||||||||
Financial
Consulting |
$ |
116 |
$ |
105 |
$ |
113 |
$ |
112 |
$ |
126 |
$ |
111 |
|||||||
Legal
Consulting |
$ |
72 |
$ |
83 |
$ |
74 |
$ |
69 |
$ |
78 |
$ |
85 |
|||||||
Health
and Education Consulting |
$ |
82 |
$ |
92 |
$ |
85 |
$ |
85 |
$ |
94 |
$ |
99 |
|||||||
Corporate
Consulting |
$ |
101 |
$ |
124 |
$ |
101 |
$ |
82 |
$ |
97 |
$ |
114 |
|||||||
Total |
$ |
95 |
$ |
100 |
$ |
95 |
$ |
91 |
$ |
102 |
$ |
104 |
|||||||
Average
number of full-time equivalents (for the period) (4): |
|||||||||||||||||||
Financial
Consulting |
2 |
5 |
10 |
9 |
10 |
6 |
|||||||||||||
Legal
Consulting |
2 |
1 |
162 |
320 |
395 |
341 |
|||||||||||||
Health
and Education Consulting |
10 |
21 |
10 |
12 |
63 |
60 |
|||||||||||||
|
Corporate
Consulting |
¾ |
¾ |
2 |
2 |
5 |
6 |
|||||||||||||
Total |
14 |
27 |
184 |
343 |
473 |
413 |
|||||||||||||
Revenue
per full-time equivalents
(in
thousands): |
|||||||||||||||||||
Financial
Consulting |
$ |
113 |
$ |
134 |
$ |
110 |
$ |
147 |
$ |
147 |
$ |
97 |
|||||||
Legal
Consulting |
$ |
76 |
$ |
105 |
$ |
27 |
$ |
31 |
$ |
35 |
$ |
36 |
|||||||
Health
and Education Consulting |
$ |
98 |
$ |
64 |
$ |
89 |
$ |
104 |
$ |
103 |
$ |
125 |
|||||||
Corporate
Consulting |
$ |
¾ |
$ |
¾ |
$ |
59 |
$ |
56 |
$ |
114 |
$ |
91 |
|||||||
Total |
$ |
98 |
$ |
80 |
$ |
36 |
$ |
36 |
$ |
47 |
$ |
51 |
|||||||
| (1) |
Consists
of our full-time professionals who provide consulting services and
generate revenues based on the number of hours
worked. |
| (2) |
Utilization
rate for our full-time billable consultants is calculated by dividing the
number of hours all our full-time billable consultants worked on client
assignments during a period by the total available working hours for all
of these consultants during the same period, assuming a forty-hour work
week, less paid holidays and vacation days. |
| (3) |
Average
billing rate per hour for our full-time billable consultants is calculated
by dividing revenues for a period by the number of hours worked on client
assignments during the same period. |
| (4) |
Consists
of our variable, on-demand consultants, contract reviewers and other
professionals who generate revenues based on units produced, such as pages
reviewed and data processed. |
| N/M |
Not
meaningful, change greater than 500%. |
HURON
CONSULTING GROUP INC.
RECONCILIATION
OF OPERATING INCOME TO ADJUSTED EARNINGS BEFORE INTEREST,
TAXES,
DEPRECIATION AND AMORTIZATION (5)
(in
thousands)
|
Three
months ended
September 30, |
Nine
months ended
September 30, |
||||||||||||
|
2007 |
2006 |
2007 |
2006 |
||||||||||
|
Revenues |
$ |
134,051 |
$ |
75,194 |
$ |
368,326 |
$ |
205,150 |
|||||
Operating
income |
$ |
21,826 |
$ |
12,123 |
$ |
60,508 |
$ |
33,103 |
|||||
Add
back: |
|||||||||||||
|
Depreciation
and amortization |
6,491 |
3,388 |
19,254 |
8,181 |
|||||||||
Earnings
before interest, taxes, depreciation and
amortization
(EBITDA) (5) |
28,317 |
15,511 |
79,762 |
41,284 |
|||||||||
Add
back: |
|||||||||||||
Share-based
compensation |
5,187 |
2,501 |
14,238 |
7,223 |
|||||||||
|
Secondary
offering costs |
¾ |
¾ |
¾ |
567 |
|||||||||
|
Total
adjusted items |
5,187 |
2,501 |
14,238 |
7,790 |
|||||||||
|
Adjusted
EBITDA (5) |
$ |
33,504 |
$ |
18,012 |
$ |
94,000 |
$ |
49,074 |
|||||
|
Adjusted
EBITDA as a percentage of revenues |
25.0 |
% |
24.0 |
% |
25.5 |
% |
23.9 |
% | |||||
RECONCILIATION
OF NET INCOME TO NET INCOME BEFORE SECONDARY OFFERING
COSTS
AND
ADJUSTED NET INCOME (5)
(in
thousands)
|
Three
months ended
September 30, |
Nine
months ended
September 30, |
||||||||||||
|
2007 |
2006 |
2007 |
2006 |
||||||||||
|
Net
income |
$ |
10,487 |
$ |
6,785 |
$ |
30,399 |
$ |
18,661 |
|||||
|
Diluted
earnings per share |
$ |
0.58 |
$ |
0.39 |
$ |
1.69 |
$ |
1.08 |
|||||
|
Add
back: Secondary offering costs, net of tax |
¾ |
¾ |
¾ |
567 |
|||||||||
|
Net
income before secondary offering costs (5) |
$ |
10,487 |
$ |
6,785 |
$ |
30,399 |
$ |
19,228 |
|||||
|
Diluted
earnings per share before secondary
offering
costs (5) |
$ |
0.58 |
$ |
0.39 |
$ |
1.69 |
$ |
1.12 |
|||||
Add
back other adjustments: |
|||||||||||||
Amortization
of intangible assets |
3,791 |
1,457 |
11,447 |
3,516 |
|||||||||
Share-based
compensation |
5,187 |
2,501 |
14,238 |
7,223 |
|||||||||
|
Tax
effect |
(3,672 |
) |
(1,613 |
) |
(10,505 |
) |
(4,392 |
) | |||||
|
Total
adjustments, net of tax |
5,306 |
2,345 |
15,180 |
6,347 |
|||||||||
|
Adjusted
net income (5) |
$ |
15,793 |
$ |
9,130 |
$ |
45,579 |
$ |
25,575 |
|||||
|
Adjusted
diluted earnings per share (5) |
$ |
0.87 |
$ |
0.52 |
$ |
2.54 |
$ |
1.49 |
|||||
| (5) |
In
evaluating the Company’s financial performance, management uses earnings
before interest, taxes, depreciation and amortization (“EBITDA”), adjusted
EBITDA, net income before secondary offering costs, and adjusted net
income, which are non-GAAP measures. Management believes that the use of
such measures, as supplements to operating income, net income and other
GAAP measures, are useful indicators of the Company’s financial
performance and its ability to generate cash flows from operations that
are available for taxes and capital expenditures. Additionally, these
measures exclude certain items to provide better comparability from period
to period. Investors should recognize that these non-GAAP measures might
not be comparable to similarly titled measures of other companies. These
measures should be considered in addition to, and not as a substitute for
or superior to, any measure of performance, cash flows or liquidity
prepared in accordance with accounting principles generally accepted in
the United States. |