Internal Growth, P&M Acquisition Boost Revenues and Earnings
ANNAPOLIS, Md., July 26 /PRNewswire/ -- FTI Consulting, Inc. (AMEX: FCN),
the premier national provider of strategic and litigation-related consulting
services, today reported record financial results for the second quarter and
six months ended June 30, 2000. Organic growth combined with contributions
from the successful integration of the February 2000 acquisition of
Policano & Manzo L.L.C. (P&M) drove the Company's performance.
Second-Quarter Results
Actual revenues increased 62.4 percent to $34.6 million from $21.3 million
in the second quarter of 1999, and income from operations grew to $6.6 million
from $2.5 million in the comparable quarter last year. Net income was
$1.9 million, or $0.26 per share on a diluted basis, compared with $771,000,
or $0.15 per share on a diluted basis. Earnings per share was calculated on
7.5 million shares compared with 5.0 million shares last year. Earnings
before interest, taxes, depreciation and amortization (EBITDA) in the second
quarter was $8.5 million, more than double EBITDA of $3.7 million in the
1999 period.
On a pro forma basis giving effect to the P&M acquisition for the
1999 second quarter, revenues increased 29.3 percent, operating income was up
26.6 percent, and net income grew 53.4 percent. EBITDA increased
20.2 percent.
Six-Month Results
Actual revenues increased 58.8 percent to $65.6 million from $41.3 million
in the 1999 period, and income from operations grew to $12.3 million from
$4.3 million. Income before extraordinary item was $3.8 million, or
$0.55 per share on a diluted basis, compared with $1.3 million, or
$0.27 per share on a diluted basis. EBITDA was $15.9 million compared with
$6.6 million in the 1999 period.
On a pro forma basis giving effect to the P&M acquisition as of January 1
for both years, revenues increased 30.0 percent to $68.0 million from
$52.3 million in the 1999 period, and income from operations grew 36.4 percent
to $13.5 million from $9.9 million. Income before extraordinary item
increased 90.9 percent to $4.2 million, or $0.57 per share on a diluted basis,
from $2.2 million, or $0.35 per share on a diluted basis. EBITDA was up
27.4 percent to $17.2 million compared with $13.5 million for the first six
months of 1999.
Commenting on the results, Stewart Kahn, FTI's president, stated, "I am
very pleased that we saw contributions from our existing businesses as well as
from our acquisition of P&M, and that we recognized benefits of the
acquisition integration faster than expected."
Kahn had previously noted that the Company's staff utilization rate in the
first quarter was extraordinary and, as expected, it returned to more normal,
sustainable levels during the second quarter. Further, the company hired
additional staff and added senior management primarily to its Financial and
Litigation Consulting businesses.
Continued Strong Performance
Jack Dunn, FTI's chairman and chief executive officer, stated, "I am very
pleased that we have produced our fifth consecutive quarter of double-digit,
quarter-to-comparable-quarter growth. We will continue to follow our game
plan of pursuing selective acquisitions, adding the professional staff
necessary and exploring technology to maintain FTI as the industry's best
single source for high-end consulting services."
With respect to technology, according to Dunn, the Company remains very
excited about the two initiatives introduced during the second quarter. In
April, the Company launched an Internet business-to-business solution to
network multiple war rooms for clients who are involved in multi-district,
multi-site cases. FTI, its clients and their outside law firms will be able
to easily, reliably and securely access and exchange highly confidential
litigation information over the Internet. In June, the Company introduced its
FTI Automated Warroom service that enables the user to pull together different
types of information media on a laptop computer and arrange it into a trial
presentation in real time without leaving the war room.
"While we hope eventually to develop these products into significant
revenue sources in their own right," Dunn commented, "right now they are
innovative, efficient and cost-effective tools that, in the hands of our
skilled professionals, provide our clients with a competitive edge with their
cases and us a competitive edge with our clients."
About FTI Consulting
FTI Consulting is a multi-disciplined consulting firm with leading
practices in the areas of 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. 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. AND SUBSIDIARIES
CONDENSED AND CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED JUNE 30, 2000 AND 1999
AND PRO FORMA THREE MONTHS ENDED JUNE 30, 1999
(in thousands of dollars, except share and per-share data)
Pro Forma (A)
Three Months
Three Months Ended Ended
6/30/2000 6/30/1999 6/30/1999
(unaudited) (unaudited)
Revenues $34,585 $21,273 $26,757
Direct cost of revenues 17,435 10,920 12,681
Selling, general and
administrative expenses 9,297 7,256 7,616
Amortization of goodwill 1,233 570 1,229
Total costs and expenses 27,965 18,746 21,526
Income from operations 6,620 2,527 5,231
Interest expense, net 3,142 1,025 2,995
Income before income taxes 3,478 1,502 2,236
Income taxes 1,530 731 966
Net income $1,948 $771 $1,270
Net income per common share,
basic $0.30 $0.16 $0.21
Weighted average shares
for basic 6,413 4,829 6,134
Net income per common share,
diluted $0.26 $0.15 $0.20
Weighted average shares for
diluted 7,513 5,010 6,315
EBITDA $8,500 $3,703 $7,074
(A) Pro forma gives effect to the acquisition of P&M as of January 1, 1999
FTI CONSULTING, INC. AND SUBSIDIARIES
CONDENSED AND CONSOLIDATED STATEMENTS OF INCOME
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
AND PRO FORMA SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(in thousands of dollars, except share and per-share data)
Pro Forma (A)
Six Months Ended Six Months Ended
6/30/2000 6/30/1999 6/30/2000 6/30/1999
(unaudited) (unaudited)
Revenues $65,599 $41,273 $68,037 $52,276
Direct cost of
revenues 32,754 21,350 33,761 24,770
Selling, general
and administrative
expenses 18,269 14,444 18,317 15,182
Amortization of
goodwill 2,249 1,139 2,466 2,457
Total costs and
expenses 53,272 36,933 54,544 42,409
Income from
operations 12,327 4,340 13,493 9,867
Interest expense, net 5,493 1,821 6,074 5,999
Income before income
tax and extraordinary
items 6,834 2,519 7,419 3,868
Income taxes 3,007 1,189 3,264 1,671
Income before
extraordinary item 3,827 1,330 4,155 2,197
Extraordinary item:
Loss on early
extinguishment of debt,
net of taxes 869 - 869 -
Net income $2,958 $1,330 $3,286 $2,197
Income before
extraordinary item,
per common share,
basic $0.62 $0.28 $0.65 $0.35
Net income per common
share, basic $0.48 $0.28 $0.51 $0.35
Weighted average
shares for basic 6,139 4,829 6,404 6,249
Income before
extraordinary item,
per common share,
diluted $0.55 $0.27 $0.57 $0.35
Net income per common
share, diluted $0.43 $0.27 $0.45 $0.35
Weighted average shares
for diluted 6,955 4,895 7,287 6,315
EBITDA $15,857 $6,637 $17,242 $13,501
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years
FTI CONSULTING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 30, 2000, DECEMBER 31, 1999
AND PRO FORMA DECEMBER 31, 1999
(in thousands of dollars)
Pro Forma (A)
December 31, December 31, June 30,
1999 1999 2000
(audited) (unaudited) (unaudited)
Assets
Current assets
Cash and cash equivalents $5,046 $1,881 $2,992
Accounts receivable,
less allowances 14,458 19,278 25,070
Unbilled receivable,
less allowances 9,222 9,592 15,118
Other current assets 2,166 2,191 2,962
Total current assets 30,892 32,942 46,142
Property and equipment, net 8,379 8,533 8,890
Goodwill 43,658 95,731 93,702
Other assets 1,363 4,721 3,921
Total Assets $84,292 $141,927 $152,655
Liabilities and Stockholders'
Equity
Current liabilities
Accounts payable and accrued
expenses $9,035 $9,934 $11,350
Income taxes payable 471 471 471
Current portion of
long-term debt 1,718 4,250 4,750
Advances from clients 435 2,572 6,902
Total current liabilities 11,659 17,227 23,473
Long-term debt, less current
portion, net of discounts 41,009 83,036 82,277
Deferred income taxes and other
liabilities 1,372 1,372 1,333
Stockholders' equity
Preferred stock, $.01 par value;
4,000,000 shares authorized,
none outstanding - - -
Common stock, $.01 par value;
16,000,000 shares
authorized, 4,931,905,
6,333,409, and 6,465,968 shares
issued and outstanding in 1999
and pro forma 1999, and
June 30, 2000, respectively 49 63 65
Additional paid-in capital 18,197 29,804 30,543
Retained earnings 12,006 10,425 14,964
Total stockholders' equity 30,252 40,292 45,572
Total Liabilities and
Stockholders' Equity $84,292 $141,927 $152,655
(A) Pro forma gives effect to the acquisition of P&M as of
December 31, 1999
FTI CONSULTING, INC. AND SUBSIDIARIES
REVENUES AND EBITDA BY DIVISION
THREE MONTHS ENDED JUNE 30, 2000 AND 1999
AND PRO FORMA THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(in thousands of dollars)
Pro Forma (A)
Three Months
Three Months Ended Ended
6/30/2000 6/30/1999 6/30/1999
(unaudited) (unaudited)
Revenues:
Financial Consulting $16,332 $4,827 $10,311
Litigation Consulting 8,570 6,985 6,985
Applied Sciences 9,683 9,461 9,461
Total Revenues $34,585 $21,273 $26,757
EBITDA, before corporate
charges:
Financial Consulting $6,645 $1,185 $4,556
Litigation Consulting 2,219 1,999 1,999
Applied Sciences 1,647 1,769 1,769
Total EBITDA, before corporate
charges $10,511 $4,953 $8,324
(A) Pro forma gives effect to the acquisition of P&M as of January 1, 1999
FTI CONSULTING, INC. AND SUBSIDIARIES
REVENUES AND EBITDA BY DIVISION
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
AND PRO FORMA SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(in thousands of dollars)
Pro Forma (A)
Six Months Ended Six Months Ended
6/30/2000 6/30/1999 6/30/2000 6/30/1999
(unaudited) (unaudited)
Revenues:
Financial Consulting $28,851 $9,903 $31,289 $20,906
Litigation Consulting 17,080 13,601 17,080 13,601
Applied Sciences 19,668 17,769 19,668 17,769
Total Revenues $65,599 $41,273 $68,037 $52,276
EBITDA, before corporate charges:
Financial Consulting $11,985 $2,642 $13,370 $9,506
Litigation Consulting 4,374 3,904 4,374 3,904
Applied Sciences 3,605 2,878 3,605 2,878
Total EBITDA, before
corporate charges $19,964 $9,424 $21,349 $16,288
(A) Pro forma gives effect to the acquisition of P&M as of January 1 of
the respective years
SOURCE FTI Consulting, Inc.
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Related links:
http://www.fticonsulting.com
CONTACT:
Jack Dunn, Chairman and CEO of FTI
Consulting, Inc., 410-224-1483; or General Inquiries, Marilyn
Windsor, 312-640-6692, Analysts, Doug Broderick, 312-274-2266, or
Media, Tim Grace, 312-274-2240, all of The Financial Relations
Board for FTI Consulting
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