BOSTON--(BUSINESS WIRE)--Charles River Associates (NASDAQ: CRAI), a worldwide leader in providing management, economic, and financial consulting services, today announced financial results for its fiscal fourth quarter, the twelve weeks ended November 28, 2009.
Revenue for the fourth quarter of fiscal 2009 was $74.6 million, compared with $85.6 million for the thirteen weeks ended November 29, 2008. GAAP net income for the fourth quarter of fiscal 2009 was $2.5 million, or $0.23 per diluted share, compared with GAAP net income of $1.9 million, or $0.18 per diluted share, in the fourth quarter of fiscal 2008.
Non-GAAP revenue for the fourth quarter of fiscal 2009 was $72.8 million compared with $84.8 million for the thirteen weeks ended November 29, 2008. Non-GAAP net income for the fourth quarter of fiscal 2009 was $3.8 million, or $0.35 per diluted share, compared with non-GAAP net income of $6.0 million, or $0.56 per diluted share, in the fourth quarter of fiscal 2008.
A complete reconciliation of revenue, net income and net income per share on a GAAP and non-GAAP basis, for the fourth quarters and full years of fiscal 2009 and fiscal 2008 is provided at the end of this release.
Comments on the Fourth Quarter
“We concluded fiscal 2009 with a solid fourth-quarter performance,” said Paul Maleh, CRA’s President and Chief Executive Officer. “We experienced an uptick within Management Consulting as a number of practice areas rebounded from the levels we experienced in the first half of fiscal 2009. In particular, our Global Industrial Consulting practice produced a strong quarter, generating business across the Middle East, including the recognition of revenue that was previously deferred in that region earlier in the year. Consequently, our international business grew considerably, accounting for 31% of our fourth-quarter revenues – well above our historical levels.”
“Our results also were supported by a strong contribution from Marakon Associates, which we acquired in the third quarter and whose integration continues to progress smoothly,” Maleh said. “Marakon performed on plan and is proving to be a great source of collaboration among our combined personnel.”
“We continued to take steps in the fourth quarter to further improve our efficiency and streamline our cost structure,” said Maleh. “We decreased our SG&A expenses by reducing or moving several office locations in the U.S. and overseas. Due to the actions we have taken in the past two years, we lowered our annual non-GAAP SG&A costs by nearly 22% or $19 million in fiscal 2009.”
Fiscal 2009 Results
Revenue for fiscal 2009, the fifty-two weeks ended November 28, 2009, was $301.6 million, compared with $376.8 million for the fifty-three weeks ended November 29, 2008. Net income for fiscal 2009 was $7.8 million, or $0.73 per diluted share, compared with $8.0 million, or $0.74 per diluted share, in fiscal 2008.
Non-GAAP revenue for fiscal 2009 was $292.8 million compared with $376.0 million for the fifty-three weeks ended November 29, 2008. Non-GAAP net income for the full year fiscal 2009 was $12.6 million, or $1.17 per diluted share, compared with non-GAAP net income of $17.8 million, or $1.63 per diluted share, for fiscal 2008.
Comments on Fiscal 2009
“Fiscal 2009 was a challenging year, but ended with some positive momentum in certain areas of our portfolio,” Maleh said. “We took aggressive actions throughout the year, divesting some of our smaller, underperforming assets, reducing headcount, moving and reducing office space, completing a key acquisition, and beginning a new client facing strategy. CRA has created a scalable infrastructure and we have emerged from fiscal 2009 as a leaner, more efficient, and more focused competitor. With these efficiencies in our organization, we are poised to realize accelerated earnings growth as revenue growth returns.”
“With regards to Litigation, Regulatory, and Financial Consulting, we continue to see a reasonable level of activity,” said Maleh. “However, that activity has not translated into increased revenue as many of these large cases have yet to move forward. Our Management Consulting services are showing signs of recovering from the global economic downturn as client activity has increased and translated into revenue-generating engagements, particularly overseas.”
“Across our practice areas, CRA’s reputation in the marketplace remains unmatched, and we are a preferred provider for many of the services we offer,” said Maleh. “From a financial perspective, we continue to generate a healthy operating cash flow and maintain a strong balance sheet with considerable cash resources to support our growth initiatives. While overall visibility remains limited, our near-term outlook is cautiously optimistic, and we remain positive about the long-term value of our brand and enterprise.”
Conference Call Information and Prepared CFO Remarks
CRA will host a conference call this morning at 9:00 a.m. ET to discuss its fourth-quarter and fiscal 2009 financial results. To listen to a live webcast of the call, please visit the Company’s website at http://www.crai.com prior to the event’s broadcast. To listen to the call via telephone, dial (201) 689-8881 or (877) 709-8155. Interested parties unable to participate in the live call may access an archived version of the webcast on CRA’s website.
In combination with this press release, CRA is providing prepared remarks by its CFO Wayne Mackie under “Conference Call Materials” in the investor relations section on the Company’s website at http://www.crai.com. These remarks are offered to provide the investment community with additional background on CRA’s financial results prior to the start of the conference call.
About Charles River Associates (CRA)
Founded in 1965, Charles River Associates® is a leading global consulting firm that offers economic, financial, and business management expertise to major law firms, businesses, accounting firms, and governments. The Company’s consultants combine uncommon analytical rigor with practical experience and in-depth understanding of industries and markets. CRA is adept at handling critical, tough assignments with high-stakes outcomes. The Company’s analytical strength enables it to reach objective, factual conclusions that help clients make important business and policy decisions and resolve critical disputes. Headquartered in Boston, CRA has offices throughout North America, Europe, the Middle East, and Asia. Detailed information about Charles River Associates, a registered trade name of CRA International, Inc., is available at http://www.crai.com.
NON-GAAP FINANCIAL MEASURES
In addition to reporting its financial results in accordance with U.S. generally accepted accounting principles, or GAAP, the Company has also provided in this release non-GAAP revenue, non-GAAP net income, non-GAAP net income per share, and non-GAAP SG&A. The Company believes the use of non-GAAP measures in addition to GAAP measures is an additional useful method of evaluating its results of operations. The Company believes that presenting its financial results excluding these restructuring costs, foreign currency exchange gain/loss attributable to the liquidation of the Company’s Australia and New Zealand-based operations, gain from convertible bond repurchases, and NeuCo’s results is important to investors and management because it is more indicative of its ongoing operating results and financial condition. These non-GAAP financial measures should be considered in conjunction with, but not as a substitute for, the financial information presented in accordance with GAAP, and the expected results calculated in accordance with GAAP and reconciliations to those expected results should be carefully evaluated. The non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. Specifically, for fiscal 2009, the Company has excluded certain restructuring costs, the foreign exchange effect attributable to the liquidation of the Company’s Australian-based operations, gain from convertible bond repurchases, and NeuCo’s results. For fiscal 2008, the Company excluded certain restructuring costs, the foreign exchange effects attributable to the substantial liquidation of the Company’s New Zealand-based operations, gain from convertible bond repurchases, as well as NeuCo’s results.
Statements in this press release concerning the future business, operating results, estimated cost savings, and financial condition of the Company and statements using the terms “anticipates,” “believes,” “expects,” “should,” or similar expressions, are “forward-looking” statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon management's current expectations and are subject to a number of factors and uncertainties. Information contained in these forward-looking statements is inherently uncertain and actual performance and results may differ materially due to many important factors. Such factors that could cause actual results to differ materially from any forward-looking statements made by the Company include, among others, the Company’s restructuring costs and attributable annual cost savings, changes in the Company’s effective tax rate, share dilution from the Company’s convertible debt offering and stock-based compensation, dependence on key personnel, attracting and retaining qualified consultants, dependence on outside experts, utilization rates, factors related to its acquisitions, including integration of personnel, clients, offices, and unanticipated expenses and liabilities, the risk of impairment write downs to the Company’s intangible assets, including goodwill, if the Company’s enterprise value declines below certain levels, risks associated with acquisitions it may make in the future, risks inherent in international operations, the performance of NeuCo, changes in accounting standards, rules and regulations, changes in the law that affect its practice areas, management of new offices, the potential loss of clients, the ability of customers to terminate the Company’s engagements on short notice, dependence on the growth of the Company’s business consulting practice, the unpredictable nature of litigation-related projects, the ability of the Company to integrate successfully new consultants into its practice, general economic conditions, intense competition, risks inherent in litigation, and professional liability. Further information on these and other potential factors that could affect the Company’s financial results is included in the Company’s filings with the Securities and Exchange Commission. The Company cannot guarantee any future results, levels of activity, performance or achievement. The Company undertakes no obligation to update any of its forward-looking statements after the date of this press release.
Contacts
Charles River Associates
Wayne D. Mackie, 617-425-3740
Executive Vice President, CFO
or
Sharon Merrill Associates, Inc.
Jim Buckley, 617-542-5300
Executive Vice President