Strong Financial Consulting Segment Continues to Drive Performance
ANNAPOLIS, Md., Feb. 14 /PRNewswire/ -- FTI Consulting, Inc. (Amex: FCN),
the premier national provider of turnaround, bankruptcy and litigation-related
consulting services, today reported record results for the fourth quarter and
year ended December 31, 2000. A strong performance by the Financial
Consulting segment, which includes its February 2000 acquisition of Policano &
Manzo L.L.C. (P&M), a leader in providing bankruptcy and turnaround consulting
services to large corporations, money center banks and secured lenders
throughout the U.S., continued to drive the company's performance.
Fourth-Quarter Results
Revenues increased 59.1 percent to $35.8 million in fourth quarter of this
year from $22.5 million in the fourth quarter of last year, and income from
operations grew 132.1 percent to $6.5 million from $2.8 million in the
comparable quarter last year. Net income before extraordinary item was
$2.7 million, or $0.26 per share on a diluted basis, compared with
$1.0 million, or $0.19 per share in last year's fourth quarter. The increase
in earnings per share was achieved despite the effect of the issuance of
4.03 million additional shares of common stock in an underwritten public
offering in October 2000. Earnings before interest, taxes, depreciation and
amortization (EBITDA) were $8.5 million, more than double EBITDA of
$4.0 million in the 1999 period. On a pro forma basis giving effect to the
P&M acquisition for the 1999 fourth quarter, revenues increased 29.2 percent
and income from operations was up 22.4 percent. On a pro forma basis, net
income before extraordinary item doubled, earnings per share increased 30.0
percent from last year and EBITDA increased 18.9 percent.
Regarding the company's three operating divisions, Financial Consulting's
revenues grew to $18.3 million from $5.6 million in the 1999 fourth quarter,
and EBITDA was $7.2 million compared with $1.9 million last year. On a pro
forma basis, revenues and EBITDA for Financial Consulting grew by 69.2 percent
and 43.6 percent, respectively.
Litigation Consulting revenues declined by 9.4 percent to $7.7 million
from $8.5 million in last year's comparable quarter, and EBITDA was
$1.5 million, or 46.4 percent lower than last year's $2.8 million. The
softness in Litigation Consulting earnings that began in the third quarter of
2000 due to seasonal variations in trial activity continued throughout the
fourth quarter as an unusual number of trials were deferred or cancelled due
to settlement or settlement discussions.
For the Applied Sciences segment, revenues were $9.8 million, a 16.7
percent increase from $8.4 million in the fourth quarter of last year, and
EBITDA increased to $1.7 million from $738,000 last year. Revenue and EBITDA
increases in this division for the fourth quarter were significantly greater
than in the prior year due to a weaker-than-normal fourth quarter in 1999.
Commenting on the company's record performance, Jack Dunn, FTI's chairman
and chief executive officer, stated, "I am very pleased that we continue to
see robust overall growth for the company, and especially in our Financial
Consulting division. We continue to experience tremendous market demand for
our services in that segment as the number of financially distressed companies
increases."
Results for the fourth quarter also included a non-cash, after-tax charge
of $4.5 million, reflecting the writeoff of unamortized discount and deferred
financing costs in connection with the early repayment of the company's
$30.0 million subordinated notes and the subsequent refinancing of its
$61.0 million senior credit facility. The company prepaid the subordinated
notes with the proceeds of the above-mentioned equity offering and its
internally generated financial resources. The senior refinancing consists of
a new term loan of $32.5 million and a $47.5 million revolving credit line, of
which $28.0 million was drawn at December 31, 2000. The restructuring reduced
FTI's effective interest cost on its senior credit facility by more than 100
basis points, and provides the company with greater operating flexibility.
Year 2000 Results
On a pro forma basis giving effect to the P&M acquisition as of January 1
for both years, revenues increased 29.3 percent to $137.2 million from
$106.1 million in 1999, and income from operations was up 29.6 percent to
$25.8 million from $19.9 million. Income before extraordinary items jumped
84.4 percent to $8.3 million, or $1.03 per share on a diluted basis, from
$4.5 million, or $0.70 per share on a diluted basis. Pro forma earnings per
share were calculated on 8.1 million shares in 2000, compared with 6.4 million
shares last year. Pro forma EBITDA was $33.5 million in 2000, up from
$27.2 million.
Actual revenues increased 59.3 percent to $134.8 million in 2000 from
$84.6 million in 1999, and income from operations increased to $24.6 million
from $9.3 million. Income before extraordinary items was $8.0 million in 2000
compared with $3.0 million, and $1.00 on a diluted basis, compared with $0.59
per share, an increase of 69.5 percent. Earnings per share were calculated on
8.0 million shares compared with 5.0 million shares last year. EBITDA was
$32.1 million in 2000, more than double the $14.0 million EBITDA for 1999.
Financial Consulting's pro forma revenues increased 60.9 percent to
$66.6 million in 2000 compared with $41.4 million last year, and pro forma
EBITDA was $27.3 million versus $18.6 million. Actual revenues and EBITDA
were ahead of last year by 223 percent and 383 percent, respectively.
Litigation Consulting's revenues grew 7.9 percent to $31.4 million from
$29.1 million, with all of the growth occurring in the first half of the year,
and EBITDA was down 17.9 percent to $6.9 million from $8.4 million, with the
entire reduction arising in the second half of the year. Applied Sciences'
revenues were $39.2 million in 2000, an increase of 9.8 percent from
$35.7 million last year, and EBITDA grew to $7.3 million from $5.4 million
last year, an increase of 35.2 percent.
Stewart Kahn, president of FTI, commented, "The results for 2000 were
spectacular in our Financial Consulting and Applied Sciences divisions. In
our Litigation Consulting division, we made heavy investments in new offices
and people roughly equal to the division's decrease in earnings for the year.
We expect those investments and our recently opened New York Litigation
Consulting office to begin to pay off during the second quarter of this year.
Our Applied Sciences Division continues to see high levels of assignment
activity. The acquisition of P&M early in 2000 has enabled us to increase
significantly the utilization of our existing financial professionals and
thereby our overall profitability. The number and size of financially
troubled companies and bankruptcies, coupled with the high dedication of our
professionals bode well for a very successful year again in 2001."
Results for the year 2000 also included the fourth-quarter, non-cash,
after-tax charge of $4.5 million described above, as well as a non-cash,
after-tax charge of $869,000 in the first quarter, reflecting the writeoff of
unamortized discount and deferred financing costs in connection with the early
retirement of $44.0 million of debt in February 2000.
Outlook for 2001
The company believes that its stated goal of generating 15 percent or
greater growth in revenues and earnings per share for the full year 2001 is
achievable, even with the effect of the significantly increased number of
shares outstanding as a result our recent public equity offering. In
addition, the levels of business activity experienced in the fourth quarter of
2000 are continuing into the first quarter of 2001.
Year-End Conference Call
FTI will hold a conference call to discuss fourth-quarter results and
management's outlook for the first quarter and the full year 2001 at 11:00
a.m. EST on Wednesday, February 14, 2001. The call can be accessed live and
will be available for replay over the Internet via http://www.vcall.com .
About FTI Consulting
FTI Consulting is a multi-disciplined consulting firm with leading
practices in the areas of bankruptcy and financial restructuring, litigation
consulting and engineering/scientific investigation. Modern corporations, as
well as those who advise and invest in them, face growing challenges on every
front. From a proliferation of "bet-the-company" litigation to increasingly
complicated relationships with lenders and investors in an ever-changing
global economy, U.S. companies are turning more and more to outside experts
and consultants to meet these complex issues. FTI is dedicated to helping
corporations, their advisors, lawyers, lenders and investors meet these
challenges by providing a broad array of the highest quality professional
practices from a single source.
This press release includes "forward-looking" statements that involve
uncertainties and risks. There can be no assurance that actual results will
not differ from the company's expectations. The company has experienced
fluctuating revenues, operating income and cash flow in some prior periods and
expects this may occur from time to time in the future. As a result of these
possible fluctuations, the company's actual results may differ from our
projections. Other factors that could cause such differences include pace and
timing of additional acquisitions, the company's ability to realize cost
savings and efficiencies, competitive and general economic conditions, and
other risks described in the company's filings with the Securities and
Exchange Commission.
For further information regarding FTI Consulting, Inc. free of charge via
fax, dial 1-800-PRO-INFO and enter "FCN".
FTI is on the Internet at http://www.fticonsulting.com and at
http://www.ftiwarroom.net .
FTI CONSULTING, INC.
CONDENSED STATEMENTS OF INCOME
AND PRO FORMA CONDENSED STATEMENT OF INCOME
FOR THE FOURTH QUARTERS ENDED DECEMBER 31, 2000 AND 1999
(in thousands of dollars, except per-share data)
Quarter Ended
Actual Pro Forma Actual
12/31/2000 12/31/1999 12/31/1999
(unaudited)
Revenues $35,771 $27,680 $22,479
Direct cost of revenues 18,725 13,507 11,787
Selling, general and administrative
expenses 10,497 7,592 7,269
Amortization of goodwill 1,229 605
Total costs and expenses 29,222 22,328 19,661
Income from operations 6,549 5,352 2,818
Interest expense, net 2,134 3,185 1,205
Income before extraordinary items and
taxes 4,415 2,167 1,613
Income taxes 1,756 838 607
Income before extraordinary items 2,659 1,329 1,006
Extraordinary item:
Loss on early extinguishment of
debt, net of taxes 4,524 - -
Net income (loss) $(1,865) $1,329 $1,006
Income before extraordinary item,
per common share, basic $0.28 $0.21 $0.20
Net income (loss) per common share,
basic $(0.20) $0.21 $0.20
Weighted average shares for basic 9,492 6,291 4,914
Income before extraordinary item,
per common share, diluted $0.26 $0.20 $0.19
Net income (loss) per common share,
diluted $(0.18) $0.20 $0.19
Weighted average shares for diluted 10,274 6,549 5,172
EBITDA $8,547 $7,191 $4,011
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years.
FTI CONSULTING, INC.
CONDENSED STATEMENTS OF INCOME
AND CONDENSED PRO FORMA STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
(in thousands of dollars, except per-share data)
Pro Forma (A)
Year Ended Year Ended
12/31/2000 12/31/1999 12/31/2000 12/31/1999
(unaudited) (unaudited)
Revenues $134,764 $84,607 $137,203 $106,119
Direct cost of revenues 68,667 44,149 69,617 50,921
Selling, general and
administrative expenses 36,732 28,829 36,839 30,381
Amortization of goodwill 4,723 2,313 4,940 4,915
Total costs and expenses 110,122 75,291 111,396 86,217
Income from operations 24,642 9,316 25,807 19,902
Interest expense, net 10,771 4,014 11,352 12,144
Income before extraordinary items
and taxes 13,871 5,302 14,455 7,758
Income taxes 5,917 2,311 6,175 3,258
Income before extraordinary items7,954 2,991 8,280 4,500
Extraordinary item:
Loss on early extinguishment of
debt, net of taxes 5,393 - 5,393 -
Net income $2,561 $2,991 $2,887 $4,500
Income before extraordinary item,
per common share, basic $1.12 $0.61 $1.15 $0.71
Net income per common share,
basic $0.36 $0.61 $0.40 $0.71
Weighted average shares for basic7,075 4,872 7,216 6,291
Income before extraordinary item,
per common share, diluted $1.00 $0.59 $1.03 $0.70
Net income per common share,
diluted $0.32 $0.59 $0.36 $0.70
Weighted average shares for
diluted 7,992 5,028 8,073 6,448
EBITDA $32,134 $14,012 $33,519 $27,209
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years.
FTI CONSULTING, INC.
REVENUES AND EBITDA BY DIVISION
FOR THE THREE MONTHS ENDED DECEMBER 31, 2000
AND 1999 AND PRO FORMA THREE MONTHS
ENDED DECEMBER 31, 1999
(in thousands of dollars)
Quarter Ended
Actual Pro Forma Actual
12/31/2000 12/31/1999 12/31/1999
(unaudited)
Revenues
Financial Consulting $18,263 $10,794 $5,593
Litigation Consulting 7,730 8,509 8,509
Applied Sciences 9,778 8,377 8,377
Total Revenues $35,771 $27,680 $22,479
EBITDA, before corporate charges
Financial Consulting $7,225 $5,033 $1,853
Litigation Consulting 1,466 2,802 2,802
Applied Sciences 1,716 738 738
Total EBITDA, before corporate
charges $10,407 $8,573 $5,393
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years.
FTI CONSULTING, INC.
REVENUES AND EBITDA BY DIVISION
FOR YEARS ENDED DECEMBER 31, 2000 AND 1999
AND PRO FORMA YEARS ENDED DECEMBER 31, 2000
AND DECEMBER 31, 1999
(in thousands of dollars)
Actual Year Ended Pro Forma Year Ended
12/31/2000 12/31/1999 12/31/2000 2/31/1999
(unaudited) (unaudited)
Revenues
Financial Consulting $64,175 $19,851 $66,614 $41,363
Litigation Consulting 31,357 29,063 31,357 29,063
Applied Sciences 39,232 35,693 39,232 35,693
Total Revenues $134,764 $84,607 $137,203 $106,119
EBITDA, before corporate charges
Financial Consulting $25,889 $5,362 $27,274 $18,559
Litigation Consulting 6,868 8,484 6,868 8,484
Applied Sciences 7,269 5,417 7,269 5,417
Total EBITDA, before corporate
charges $40,026 $19,263 $41,411 $32,460
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years.
FTI CONSULTING, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2000 AND 1999
AND PRO FORMA DECEMBER 31, 1999
(in thousands of dollars, except share data)
Actual Pro Forma(A) Actual
12/31/2000 12/31/1999 12/31/1999
(unaudited) audited
Assets
Current assets
Cash and cash equivalents $3,235 $1,881 $5,046
Accounts receivable, less
allowances and retainers 20,380 16,706 14,023
Unbilled receivable, less
allowances 11,952 9,592 9,222
Other current assets 4,542 2,191 2,166
Total current assets 40,109 30,370 30,457
Property and equipment, net 13,155 8,533 8,379
Goodwill 91,971 95,731 43,658
Other assets 1,168 4,721 1,363
Total Assets $146,403 $139,355 $83,857
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued
expenses $14,841 $9,934 $9,035
Income taxes payable 500 471 471
Current portion of long-term debt 4,333 4,250 1,718
Total current liabilities 19,674 14,655 11,224
Long-term debt, less current portion,
net of discounts 56,167 83,036 41,009
Deferred income taxes and other
liabilities 1,938 1,372 1,372
Stockholders' equity
Preferred stock, $.01 par value;
4,000,000 shares
authorized, none outstanding - - -
Common stock, $.01 par value;
16,000,000 shares
authorized, 10,567,477, 6,333,409
and 4,913,905 shares
issued and outstanding in 2000,
pro forma 1999 and
1999, respectively 106 63 49
Additional paid-in capital 53,952 30,081 18,197
Retained earnings 14,566 10,148 12,006
Total stockholders' equity 68,624 40,292 30,252
Total Liabilities and Stockholders'
Equity $146,403 $139,355 $83,857
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years.
SOURCE FTI Consulting, Inc.
 back to top
Related links:
http://www.fticonsulting.com
CONTACT:
Jack Dunn, Chairman & CEO of FTI Consulting,
Inc., 410-224-1483, or General, Marilyn Windsor, 312-640-6692, or
Analysts, Doug Broderick, 312-274-2266, or Media, Tim Grace,
312-274-2240, all of The Financial Relations Board
|
