UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): October 27, 2016
CRA INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
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Massachusetts |
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000-24049 |
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04-2372210 |
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(State or other jurisdiction |
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(Commission |
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(IRS employer |
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of incorporation) |
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file number) |
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identification no.) |
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200 Clarendon Street, Boston, Massachusetts |
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02116 |
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(Address of principal executive offices) |
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(Zip code) |
Registrant’s telephone number, including area code: (617) 425-3000
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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 27, 2016, we issued a press release reporting our financial results for our fiscal third quarter ended October 1, 2016. A copy of the press release is set forth as Exhibit 99.1 and is incorporated by reference herein. On October 27, 2016, we also posted on our website supplemental financial information, including prepared CFO remarks. A copy of the supplemental financial information is set forth as Exhibit 99.2 and is incorporated by reference herein.
The information contained in Item 2.02 of this report and Exhibits 99.1 and 99.2 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such a filing.
Item 7.01. Regulation FD Disclosure.
On October 27, 2016, we announced that our board of directors has declared a quarterly cash dividend on our common stock of $0.14 per share to be paid on December 16, 2016 to all shareholders of record as of November 20, 2016. A copy of the press release announcing the dividend is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information contained in Item 7.01 of this report and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
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Number |
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Title |
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99.1 |
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October 27, 2016 press release |
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99.2 |
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Supplemental financial information |
SIGNATURES
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.
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CRA INTERNATIONAL, INC. | |
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Dated: October 27, 2016 |
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By: |
/s/ Chad M. Holmes |
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Chad M. Holmes |
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Chief Financial Officer, Executive Vice President and Treasurer |
Exhibit Index
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Number |
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Title |
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99.1 |
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October 27, 2016 press release |
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99.2 |
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Supplemental financial information |
Exhibit 99.1
FINAL FOR RELEASE
|
Chad Holmes |
Jamie Bernard |
|
Chief Financial Officer |
Senior Associate |
|
Charles River Associates |
Sharon Merrill Associates, Inc. |
|
312-377-2322 |
617-542-5300 |
CHARLES RIVER ASSOCIATES (CRA) REPORTS
RESULTS FOR THE THIRD QUARTER OF 2016
CRA Drives Revenue and Profitability While Delivering 7% Headcount Growth
Company Initiates Quarterly Cash Dividend
BOSTON, October 27, 2016 — Charles River Associates (NASDAQ: CRAI), a worldwide leader in providing economic, financial, and management consulting services, today announced financial results for the fiscal third quarter ended October 1, 2016 and the initiation of a quarterly cash dividend.
Key Financial Results
· Revenue up 6.8% year over year to $81.7 million; non-GAAP revenue up 8.2% year over year to $81.7 million.
· Net income up 11.6% year over year to $3.2 million; non-GAAP net income up 11.2% year over year to $3.2 million.
· Earnings per diluted share increased 22.6% year over year to $0.38; non-GAAP earnings per diluted share increased 21.9% year over year to $0.39.
· Non-GAAP Adjusted EBITDA grew 16.7% year over year to $13.8 million.
· On a constant currency basis relative to the third quarter of fiscal 2015, GAAP and non-GAAP revenue would have increased by approximately $2.2 million, resulting in year-over-year growth of 9.6% and 11.2%, respectively, whereas foreign currency headwinds had a de minimis impact on GAAP and non-GAAP net income, earnings per diluted share, and Adjusted EBITDA.
· On October 26, 2016, CRA’s Board of Directors declared a quarterly cash dividend of $0.14 per common share, payable on December 16, 2016 to shareholders of record as of November 20, 2016. The Company expects to continue paying quarterly dividends, the declaration, timing and amounts of which remain subject to the discretion of CRA’s Board of Directors.
Management Commentary
“Consistent with the first half of the year, CRA delivered strong financial results in the third quarter of fiscal 2016,” said Paul Maleh, CRA’s President and Chief Executive Officer. “Continued broad-based demand for our services provided CRA the opportunity to welcome more than 70 new colleagues, increasing quarter-end headcount by 7% compared with a year ago, while also achieving companywide quarterly utilization of 73%. We grew non-GAAP revenue by 8.2% to $81.7 million with double-digit revenue growth year over year in Energy; Finance, including legacy operations and our new colleagues in Forensic & Cyber Investigations; Labor & Employment; Life Sciences; and Marakon. International operations experienced more than 20% revenue growth year over year, led by our Antitrust & Competition Economics, Life Sciences, and Marakon practices, which would have been even stronger if adjusted for foreign currency headwinds.”
“Given the strength of our firm and its ability to generate strong cash flows, we can both invest in the business and return capital to shareholders,” said Maleh. “Our profitable growth and the initiation of a quarterly dividend, combined with our stock repurchase activity, demonstrate CRA’s continued commitment to deliver value to shareholders. During the third quarter, we repurchased approximately 111,000 shares of common stock for $2.9 million, bringing our year-to-date repurchases to approximately 784,000 shares for $19.1 million lowering our shares outstanding by 7.4% to 8.2 million shares.”
Outlook and Financial Guidance
“Looking ahead, we are positioned to build on the strong momentum seen year to date across our portfolio,” Maleh said. “On a constant currency basis relative to fiscal 2015, we expect to exceed our previously announced fiscal 2016 guidance for non-GAAP revenue of $312 million to $322 million and to be in the upper half of our non-GAAP Adjusted EBITDA margin range of 15.8% to 16.6%. While we are encouraged by CRA’s solid performance through the first three quarters of fiscal 2016, we remain mindful of short-term challenges arising from the integration of newly hired professionals, the potential impact of seasonality, and uncertainties around global economic conditions.”
CRA does not provide reconciliations of its non-GAAP revenue and Adjusted EBITDA margin guidance to the GAAP comparable financial measures because CRA is unable to estimate with reasonable certainty the financial results of its former NeuCo subsidiary, now known as GNU123 Liquidating Corporation (“GNU”), the timing and amount of forgivable loans issued for talent acquisition, share-based compensation expense, unusual gains or charges, foreign exchange rates, and the resulting effect of these items on CRA’s taxes without unreasonable effort. These items are uncertain, depend on various factors, and may have a material effect on CRA’s results computed in accordance with GAAP. A reconciliation between the historical GAAP and non-GAAP financial measures presented in this release is provided in the financial tables at the end of this release, and further information regarding the non-GAAP measures presented in this release is provided below under the heading “Non-GAAP Financial Measures.”
Conference Call Information and Prepared CFO Remarks
CRA will host a conference call this morning at 10:00 a.m. ET to discuss its third quarter 2016 financial results. To listen to the live call, please visit the “Investor Relations” section of CRA’s website at http://www.crai.com, or dial (877) 709-8155 or (201) 689-8881. An archived version of the webcast will be available on CRA’s website for one year.
In combination with this press release, CRA has posted prepared remarks by its CFO Chad Holmes under “Conference Call Materials” in the “Investor Relations” section on CRA’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)
Charles River Associates® is a global consulting firm specializing in economic, financial, and management consulting services. CRA advises clients on economic and financial matters pertaining to litigation and regulatory proceedings, and guides corporations through critical business strategy and performance-related issues. Since 1965, clients have engaged CRA for its unique combination of functional expertise and industry knowledge, and for its objective solutions to complex problems. Headquartered in Boston, CRA has offices throughout the world and celebrated its 50th anniversary in 2015. Detailed information about Charles River Associates, a registered trade name of CRA International, Inc., is available at www.crai.com. Follow us on LinkedIn, Twitter, and Facebook.
NON-GAAP FINANCIAL MEASURES
In addition to reporting its financial results in accordance with U.S. generally accepted accounting principles, or GAAP, CRA has also provided in this release non-GAAP financial information. CRA believes that the use of non-GAAP measures in addition to GAAP measures is a useful method of evaluating its results of operations. CRA believes that presenting its financial results excluding the results of GNU, certain non-cash and/or non-recurring charges, and the other items identified below, and including presentations of Adjusted EBITDA and comparisons on a constant currency basis, are important to investors and management because they are more indicative of CRA’s 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 results calculated in accordance with GAAP and reconciliations to those results should be carefully evaluated. The non-GAAP financial measures used by CRA may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. Specifically, for the third quarter of fiscal 2016, the third quarter of fiscal 2015, the year-to-date period ended as of the third quarter of fiscal 2016, and its full 2016 fiscal year guidance, CRA has excluded GNU’s results, and for the year-to-date period ended as of the third quarter of 2015, CRA has excluded GNU’s results and a non-cash charge relating to an increased liability for a future contingent consideration payment relating to a prior acquisition. Also, in calculating “Adjusted EBITDA” from net income (loss) attributable to CRA for these fiscal periods and for purposes of the full 2016 fiscal year guidance for Adjusted EBITDA margin, CRA has excluded net income (loss) attributable to noncontrolling interests (net of tax), interest expense, net; provision for income taxes, other income (expense), net; and the following non-cash expenses: depreciation and amortization, share-based compensation expenses, and amortization of forgivable loans.
Finally, CRA believes that fluctuations in foreign currency exchange rates can significantly affect its financial results. Therefore, CRA provides a constant currency presentation to supplement disclosures regarding its results of operations and performance. CRA calculates constant currency amounts by converting its applicable fiscal period local currency financial results using the prior fiscal year’s corresponding period exchange rates. CRA has presented in this press release its GAAP and non-GAAP revenue, net income, and earnings per diluted share, and its Adjusted EBITDA, for the third quarter of fiscal 2016 on a constant currency basis relative to the third quarter of fiscal 2015, and its guidance for fiscal 2016 non-GAAP revenue and Adjusted EBITDA margin on a constant currency basis relative to fiscal 2015.
SAFE HARBOR STATEMENT
Statements in this press release concerning our future business, operating results and financial condition, including guidance on future non-GAAP revenue and non-GAAP Adjusted EBITDA margin, and statements regarding undeclared dividend payments, our ability and commitment to invest in our business while returning capital to shareholders, the continuation of the current strength of our business, the demand for our services, or our ability to generate cash flows, and statements using the terms “looking ahead,” “expect,” “believe,” “can,” “positioned,” “should,” or similar expressions, are “forward-looking” statements as defined in Section 21 of the Exchange Act. These statements are based upon our current expectations and various underlying assumptions. Although we believe there is a reasonable basis for these statements and assumptions, and these statements are expressed in good faith, these statements are subject to a number of additional factors and uncertainties. Our actual non-GAAP revenue and non-GAAP Adjusted EBITDA margin in fiscal 2016 on a constant currency basis relative to fiscal 2015 could differ materially from the guidance presented herein, and our actual performance and results may differ materially from the performance and results contained or implied by the other forward-looking statements made herein, due to many important factors. These factors include, but are not limited to, the possibility that the demand for our services may decline as a result of changes in general and industry specific economic conditions, the timing of engagements for our services, the effects of competitive services and pricing, our ability to attract and retain key employee or non-employee experts; the impact of a quarterly dividend and/or the failure to declare future dividends; the inability to integrate and utilize existing consultants and personnel; global economic conditions including less stable political and economic environments; foreign exchange rate fluctuations; unanticipated expenses and liabilities; risks inherent in international operations; changes in accounting standards, rules, and regulations; our ability to collect on forgivable loans should any become due; and professional and other legal liability. Additional risks and uncertainties are discussed in our periodic filings with the Securities and Exchange Commission under the heading “Risk Factors.” The inclusion of such forward-looking information should not be regarded as our representation that the future events, plans, or expectations contemplated will be achieved. We undertake no obligation to update any forward-looking statements after the date of this press release, and we do not intend to do so.
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS INCLUDING A RECONCILIATION TO NON-GAAP RESULTS
FOR THE QUARTER ENDED OCTOBER 1, 2016 COMPARED TO THE QUARTER ENDED OCTOBER 3, 2015
(In thousands, except per share data)
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Quarter Ended October 1, 2016 |
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Quarter Ended October 3, 2015 |
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GAAP |
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Adjustments to |
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Non-GAAP |
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GAAP |
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Adjustments to |
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Non-GAAP |
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GAAP |
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% of |
|
GAAP Results |
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Non-GAAP |
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% of |
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GAAP |
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% of |
|
GAAP Results |
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Non-GAAP |
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% of |
| ||||||
|
|
|
Results |
|
Revenues |
|
(GNU) (1) |
|
Results |
|
Revenues |
|
Results |
|
Revenues |
|
(GNU) (1) |
|
Results |
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Revenues |
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| ||||||
|
Revenues |
|
$ |
81,691 |
|
100.0 |
% |
$ |
— |
|
$ |
81,691 |
|
100.0 |
% |
$ |
76,525 |
|
100.0 |
% |
$ |
1,055 |
|
$ |
75,470 |
|
100.0 |
% |
|
Costs of services |
|
57,832 |
|
70.8 |
% |
— |
|
57,832 |
|
70.8 |
% |
52,029 |
|
68.0 |
% |
334 |
|
51,695 |
|
68.5 |
% | ||||||
|
Gross profit |
|
23,859 |
|
29.2 |
% |
— |
|
23,859 |
|
29.2 |
% |
24,496 |
|
32.0 |
% |
721 |
|
23,775 |
|
31.5 |
% | ||||||
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Selling, general and administrative expenses |
|
16,671 |
|
20.4 |
% |
95 |
|
16,576 |
|
20.3 |
% |
18,355 |
|
24.0 |
% |
772 |
|
17,583 |
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23.3 |
% | ||||||
|
Depreciation and amortization |
|
1,891 |
|
2.3 |
% |
— |
|
1,891 |
|
2.3 |
% |
1,560 |
|
2.0 |
% |
— |
|
1,560 |
|
2.1 |
% | ||||||
|
Income (loss) from operations |
|
5,297 |
|
6.5 |
% |
(95 |
) |
5,392 |
|
6.6 |
% |
4,581 |
|
6.0 |
% |
(51 |
) |
4,632 |
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6.1 |
% | ||||||
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Interest and other (expense), net |
|
(237 |
) |
-0.3 |
% |
— |
|
(237 |
) |
-0.3 |
% |
(235 |
) |
-0.3 |
% |
(14 |
) |
(221 |
) |
-0.3 |
% | ||||||
|
Income (loss) before provision for income taxes and noncontrolling interest |
|
5,060 |
|
6.2 |
% |
(95 |
) |
5,155 |
|
6.3 |
% |
4,346 |
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5.7 |
% |
(65 |
) |
4,411 |
|
5.8 |
% | ||||||
|
Provision for income taxes |
|
(1,909 |
) |
-2.3 |
% |
— |
|
(1,909 |
) |
-2.3 |
% |
(1,533 |
) |
-2.0 |
% |
(42 |
) |
(1,491 |
) |
-2.0 |
% | ||||||
|
Net income (loss) |
|
3,151 |
|
3.9 |
% |
(95 |
) |
3,246 |
|
4.0 |
% |
2,813 |
|
3.7 |
% |
(107 |
) |
2,920 |
|
3.9 |
% | ||||||
|
Net (income) loss attributable to noncontrolling interests, net of tax |
|
42 |
|
0.1 |
% |
42 |
|
— |
|
0.0 |
% |
47 |
|
0.1 |
% |
47 |
|
— |
|
0.0 |
% | ||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
3,193 |
|
3.9 |
% |
$ |
(53 |
) |
$ |
3,246 |
|
4.0 |
% |
$ |
2,860 |
|
3.7 |
% |
$ |
(60 |
) |
$ |
2,920 |
|
3.9 |
% |
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Net Income per share attributable to CRA International, Inc.: |
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Basic |
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$ |
0.39 |
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|
|
|
|
$ |
0.39 |
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|
|
$ |
0.32 |
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|
|
|
|
$ |
0.33 |
|
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| ||
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Diluted |
|
$ |
0.38 |
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|
|
|
|
$ |
0.39 |
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|
|
$ |
0.31 |
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|
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|
$ |
0.32 |
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| ||
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Weighted average number of shares outstanding: |
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|
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Basic |
|
8,177 |
|
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|
|
|
8,177 |
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|
|
8,940 |
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|
8,940 |
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| ||||||
|
Diluted |
|
8,309 |
|
|
|
|
|
8,309 |
|
|
|
9,025 |
|
|
|
|
|
9,025 |
|
|
| ||||||
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS INCLUDING A RECONCILIATION TO NON-GAAP RESULTS
FOR THE YEAR-TO-DATE PERIOD ENDED OCTOBER 1, 2016 COMPARED TO THE YEAR-TO-DATE PERIOD ENDED OCTOBER 3, 2015
(In thousands, except per share data)
|
|
|
Year-To-Date Period Ended October 1, 2016 |
|
Year-To-Date Period Ended October 3, 2015 |
| |||||||||||||||||||||||||
|
|
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|
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GAAP |
|
Adjustments to |
|
|
|
Non-GAAP |
|
|
|
GAAP |
|
Adjustments to |
|
Adjustments to |
|
|
|
Non-GAAP |
| |||||||
|
|
|
GAAP |
|
% of |
|
GAAP Results |
|
Non-GAAP |
|
% of |
|
GAAP |
|
% of |
|
GAAP Results |
|
GAAP Results |
|
Non-GAAP |
|
% of |
| |||||||
|
|
|
Results |
|
Revenues |
|
(GNU) (1) |
|
Results |
|
Revenues |
|
Results |
|
Revenues |
|
(Contingent Liability) (2) |
|
(GNU) (1) |
|
Results |
|
Revenues |
| |||||||
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| |||||||
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Revenues |
|
$ |
245,210 |
|
100.0 |
% |
$ |
826 |
|
$ |
244,384 |
|
100.0 |
% |
$ |
231,099 |
|
100.0 |
% |
$ |
— |
|
$ |
2,859 |
|
$ |
228,240 |
|
100.0 |
% |
|
Costs of services |
|
171,297 |
|
69.9 |
% |
455 |
|
170,842 |
|
69.9 |
% |
156,523 |
|
67.7 |
% |
833 |
|
1,040 |
|
154,650 |
|
67.8 |
% | |||||||
|
Gross profit |
|
73,913 |
|
30.1 |
% |
371 |
|
73,542 |
|
30.1 |
% |
74,576 |
|
32.3 |
% |
(833 |
) |
1,819 |
|
73,590 |
|
32.2 |
% | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Selling, general and administrative expenses |
|
52,748 |
|
21.5 |
% |
1,144 |
|
51,604 |
|
21.1 |
% |
55,105 |
|
23.8 |
% |
— |
|
2,405 |
|
52,700 |
|
23.1 |
% | |||||||
|
Depreciation and amortization |
|
5,861 |
|
2.4 |
% |
— |
|
5,861 |
|
2.4 |
% |
4,766 |
|
2.1 |
% |
— |
|
— |
|
4,766 |
|
2.1 |
% | |||||||
|
Income (loss) from operations |
|
15,304 |
|
6.2 |
% |
(773 |
) |
16,077 |
|
6.6 |
% |
14,705 |
|
6.4 |
% |
(833 |
) |
(586 |
) |
16,124 |
|
7.1 |
% | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Interest and other income (expense), net |
|
3,210 |
|
1.3 |
% |
3,828 |
|
(618 |
) |
-0.3 |
% |
(337 |
) |
-0.1 |
% |
— |
|
570 |
|
(907 |
) |
-0.4 |
% | |||||||
|
Income (loss) before provision for income taxes and noncontrolling interest |
|
18,514 |
|
7.6 |
% |
3,055 |
|
15,459 |
|
6.3 |
% |
14,368 |
|
6.2 |
% |
(833 |
) |
(16 |
) |
15,217 |
|
6.7 |
% | |||||||
|
Provision for income taxes |
|
(6,357 |
) |
-2.6 |
% |
(308 |
) |
(6,049 |
) |
-2.5 |
% |
(5,454 |
) |
-2.4 |
% |
— |
|
(97 |
) |
(5,357 |
) |
-2.3 |
% | |||||||
|
Net income (loss) |
|
12,157 |
|
5.0 |
% |
2,747 |
|
9,410 |
|
3.9 |
% |
8,914 |
|
3.9 |
% |
(833 |
) |
(113 |
) |
9,860 |
|
4.3 |
% | |||||||
|
Net (income) loss attributable to noncontrolling interests, net of tax |
|
(1,327 |
) |
-0.5 |
% |
(1,327 |
) |
— |
|
0.0 |
% |
50 |
|
0.0 |
% |
— |
|
50 |
|
— |
|
0.0 |
% | |||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
10,830 |
|
4.4 |
% |
$ |
1,420 |
|
$ |
9,410 |
|
3.9 |
% |
$ |
8,964 |
|
3.9 |
% |
$ |
(833 |
) |
$ |
(63 |
) |
$ |
9,860 |
|
4.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Net Income per share attributable to CRA International, Inc.: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Basic |
|
$ |
1.25 |
|
|
|
|
|
$ |
1.09 |
|
|
|
$ |
0.98 |
|
|
|
|
|
|
|
$ |
1.08 |
|
|
| |||
|
Diluted |
|
$ |
1.24 |
|
|
|
|
|
$ |
1.08 |
|
|
|
$ |
0.97 |
|
|
|
|
|
|
|
$ |
1.06 |
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Weighted average number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Basic |
|
8,581 |
|
|
|
|
|
8,581 |
|
|
|
9,055 |
|
|
|
|
|
|
|
9,055 |
|
|
| |||||||
|
Diluted |
|
8,653 |
|
|
|
|
|
8,653 |
|
|
|
9,182 |
|
|
|
|
|
|
|
9,182 |
|
|
| |||||||
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
(2) This adjustment includes activity related to an increase in the liability for future contingent consideration payments in connection with a previous acquisition.
CRA INTERNATIONAL, INC.
UNAUDITED ADJUSTED EBITDA INCLUDING A RECONCILIATION TO NON-GAAP ADJUSTED EBITDA
FOR THE QUARTER AND YEAR-TO-DATE PERIOD ENDED OCTOBER 1, 2016 COMPARED TO THE QUARTER AND YEAR-TO-DATE PERIOD ENDED OCTOBER 3, 2015
(In thousands)
|
|
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
| |||||||
|
|
|
Quarter Ended |
|
% of |
|
GAAP Results |
|
Quarter Ended |
|
% of |
|
Quarter Ended |
|
% of |
|
GAAP Results |
|
GAAP Results |
|
Quarter Ended |
|
% of |
| |||||||
|
|
|
October 1, 2016 |
|
Revenues |
|
(GNU) (1) |
|
October 1, 2016 |
|
Revenues |
|
October 3, 2015 |
|
Revenues |
|
(Contingent Liability) (2) |
|
(GNU) (1) |
|
October 3, 2015 |
|
Revenues |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Revenues |
|
$ |
81,691 |
|
100.0 |
% |
$ |
— |
|
$ |
81,691 |
|
100.0 |
% |
$ |
76,525 |
|
100.0 |
% |
$ |
— |
|
$ |
1,055 |
|
$ |
75,470 |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
3,193 |
|
3.9 |
% |
$ |
(53 |
) |
$ |
3,246 |
|
4.0 |
% |
$ |
2,860 |
|
3.7 |
% |
$ |
— |
|
$ |
(60 |
) |
$ |
2,920 |
|
3.9 |
% |
|
Net (loss) attributable to noncontrolling interest, net of tax |
|
(42 |
) |
0.1 |
% |
(42 |
) |
— |
|
0.0 |
% |
(47 |
) |
-0.1 |
% |
— |
|
(47 |
) |
— |
|
0.0 |
% | |||||||
|
Net income (loss) |
|
3,151 |
|
3.9 |
% |
(95 |
) |
3,246 |
|
4.0 |
% |
2,813 |
|
3.7 |
% |
— |
|
(107 |
) |
2,920 |
|
3.9 |
% | |||||||
|
Interest expense,net |
|
129 |
|
0.2 |
% |
— |
|
129 |
|
0.2 |
% |
140 |
|
0.2 |
% |
— |
|
14 |
|
126 |
|
0.2 |
% | |||||||
|
Provision for income taxes |
|
1,909 |
|
2.3 |
% |
— |
|
1,909 |
|
2.3 |
% |
1,533 |
|
2.0 |
% |
— |
|
42 |
|
1,491 |
|
2.0 |
% | |||||||
|
Depreciation and amortization |
|
1,891 |
|
2.3 |
% |
— |
|
1,891 |
|
2.3 |
% |
1,560 |
|
2.0 |
% |
— |
|
— |
|
1,560 |
|
2.1 |
% | |||||||
|
EBITDA |
|
7,080 |
|
8.7 |
% |
(95 |
) |
7,175 |
|
8.8 |
% |
6,044 |
|
7.9 |
% |
— |
|
(51 |
) |
6,097 |
|
8.1 |
% | |||||||
|
Share-based compensation expenses |
|
1,687 |
|
2.1 |
% |
— |
|
1,687 |
|
2.1 |
% |
1,405 |
|
1.8 |
% |
— |
|
— |
|
1,405 |
|
1.9 |
% | |||||||
|
Amortization of forgivable loans |
|
4,784 |
|
5.9 |
% |
— |
|
4,784 |
|
5.9 |
% |
4,190 |
|
5.5 |
% |
— |
|
— |
|
4,190 |
|
5.6 |
% | |||||||
|
Other expense, net |
|
108 |
|
0.1 |
% |
— |
|
108 |
|
0.1 |
% |
95 |
|
0.1 |
% |
— |
|
— |
|
95 |
|
0.1 |
% | |||||||
|
Adjusted EBITDA |
|
$ |
13,659 |
|
16.7 |
% |
$ |
(95 |
) |
$ |
13,754 |
|
16.8 |
% |
$ |
11,736 |
|
15.3 |
% |
$ |
— |
|
$ |
(51 |
) |
$ |
11,787 |
|
15.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
|
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
| |||||||
|
|
|
Year-to-Date Period Ended |
|
% of |
|
GAAP Results |
|
Year-to-Date Period Ended |
|
% of |
|
Year-to-Date Period Ended |
|
% of |
|
GAAP Results |
|
GAAP Results |
|
Year-to-Date Period Ended |
|
% of |
| |||||||
|
|
|
October 1, 2016 |
|
Revenues |
|
(GNU) (1) |
|
October 1, 2016 |
|
Revenues |
|
October 3, 2015 |
|
Revenues |
|
(Contingent Liability) (2) |
|
(GNU) (1) |
|
October 3, 2015 |
|
Revenues |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Revenues |
|
$ |
245,210 |
|
100.0 |
% |
$ |
826 |
|
$ |
244,384 |
|
100.0 |
% |
$ |
231,099 |
|
100.0 |
% |
$ |
— |
|
$ |
2,859 |
|
$ |
228,240 |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
10,830 |
|
4.4 |
% |
$ |
1,420 |
|
$ |
9,410 |
|
3.9 |
% |
$ |
8,964 |
|
3.9 |
% |
$ |
(833 |
) |
$ |
(63 |
) |
$ |
9,860 |
|
4.3 |
% |
|
Net income (loss) attributable to noncontrolling interest, net of tax |
|
1,327 |
|
0.5 |
% |
1,327 |
|
— |
|
0.0 |
% |
(50 |
) |
0.0 |
% |
— |
|
(50 |
) |
— |
|
0.0 |
% | |||||||
|
Net income (loss) |
|
12,157 |
|
5.0 |
% |
2,747 |
|
9,410 |
|
3.9 |
% |
8,914 |
|
3.9 |
% |
(833 |
) |
(113 |
) |
9,860 |
|
4.3 |
% | |||||||
|
Interest expense,net |
|
356 |
|
0.1 |
% |
7 |
|
349 |
|
0.1 |
% |
403 |
|
0.2 |
% |
— |
|
35 |
|
368 |
|
0.2 |
% | |||||||
|
Provision for income taxes |
|
6,357 |
|
2.6 |
% |
308 |
|
6,049 |
|
2.5 |
% |
5,454 |
|
2.4 |
% |
— |
|
97 |
|
5,357 |
|
2.3 |
% | |||||||
|
Depreciation and amortization |
|
5,861 |
|
2.4 |
% |
— |
|
5,861 |
|
2.4 |
% |
4,766 |
|
2.1 |
% |
— |
|
— |
|
4,766 |
|
2.1 |
% | |||||||
|
EBITDA |
|
24,731 |
|
10.1 |
% |
3,062 |
|
21,669 |
|
8.9 |
% |
19,537 |
|
8.5 |
% |
(833 |
) |
19 |
|
20,351 |
|
8.9 |
% | |||||||
|
Share-based compensation expenses |
|
4,786 |
|
2.0 |
% |
— |
|
4,786 |
|
2.0 |
% |
4,403 |
|
1.9 |
% |
— |
|
— |
|
4,403 |
|
1.9 |
% | |||||||
|
Amortization of forgivable loans |
|
14,024 |
|
5.7 |
% |
— |
|
14,024 |
|
5.7 |
% |
11,690 |
|
5.1 |
% |
— |
|
— |
|
11,690 |
|
5.1 |
% | |||||||
|
Other income (expense),net |
|
(3,566 |
) |
-1.5 |
% |
(3,836 |
) |
270 |
|
0.1 |
% |
(66 |
) |
0.0 |
% |
— |
|
(605 |
) |
539 |
|
0.2 |
% | |||||||
|
Adjusted EBITDA |
|
$ |
39,975 |
|
16.3 |
% |
$ |
(774 |
) |
$ |
40,749 |
|
16.7 |
% |
$ |
35,564 |
|
15.4 |
% |
$ |
(833 |
) |
$ |
(586 |
) |
$ |
36,983 |
|
16.2 |
% |
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
(2) This adjustment includes activity related to an increase in the liability for future contingent consideration payments in connection with a previous acquisition.
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
|
|
|
October 1, |
|
January 2, |
| ||
|
|
|
2016 |
|
2016 |
| ||
|
|
|
|
|
|
| ||
|
Assets |
|
|
|
|
| ||
|
Cash and cash equivalents |
|
$ |
25,184 |
|
$ |
38,139 |
|
|
Accounts receivable and unbilled, net |
|
99,995 |
|
86,377 |
| ||
|
Other current assets |
|
17,895 |
|
16,278 |
| ||
|
Total current assets |
|
143,074 |
|
140,794 |
| ||
|
|
|
|
|
|
| ||
|
Property and equipment, net |
|
38,801 |
|
31,338 |
| ||
|
Goodwill and intangible assets, net |
|
78,373 |
|
80,561 |
| ||
|
Other assets |
|
49,325 |
|
61,024 |
| ||
|
Total assets |
|
$ |
309,573 |
|
$ |
313,717 |
|
|
|
|
|
|
|
| ||
|
Liabilities and shareholders’ equity |
|
|
|
|
| ||
|
Current liabilities |
|
$ |
80,244 |
|
$ |
86,458 |
|
|
Long-term liabilities |
|
22,107 |
|
16,191 |
| ||
|
Total liabilities |
|
102,351 |
|
102,649 |
| ||
|
|
|
|
|
|
| ||
|
Total shareholders’ equity |
|
207,222 |
|
211,068 |
| ||
|
Total liabilities and shareholders’ equity |
|
$ |
309,573 |
|
$ |
313,717 |
|
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
|
|
|
Fiscal Year-to-Date |
|
Fiscal Year-to-Date |
| ||
|
|
|
October 1, |
|
October 3, |
| ||
|
|
|
2016 |
|
2015 |
| ||
|
Operating activities: |
|
|
|
|
| ||
|
Net income |
|
$ |
12,157 |
|
$ |
8,914 |
|
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities, net of effect of acquired businesses: |
|
|
|
|
| ||
|
GNU gain on sale of business (1) |
|
(3,836 |
) |
— |
| ||
|
Non-cash items, net |
|
14,476 |
|
13,707 |
| ||
|
Accounts receivable and unbilled services |
|
(15,501 |
) |
(11,765 |
) | ||
|
Working capital items, net |
|
8,917 |
|
(15,720 |
) | ||
|
Net cash provided by (used in) operating activities |
|
16,213 |
|
(4,864 |
) | ||
|
|
|
|
|
|
| ||
|
Investing activities: |
|
|
|
|
| ||
|
Purchase of property and equipment |
|
(11,808 |
) |
(12,696 |
) | ||
|
GNU cash proceeds from sale of business assets |
|
1,100 |
|
— |
| ||
|
Collections on notes receivable |
|
— |
|
1,554 |
| ||
|
Payments on notes receivable |
|
— |
|
(77 |
) | ||
|
Net cash used in investing activities |
|
(10,708 |
) |
(11,219 |
) | ||
|
|
|
|
|
|
| ||
|
Financing activities: |
|
|
|
|
| ||
|
Issuance of common stock, principally stock option exercises |
|
1,448 |
|
602 |
| ||
|
Payments on notes payable |
|
(75 |
) |
(300 |
) | ||
|
Borrowings under line of credit |
|
7,500 |
|
4,000 |
| ||
|
Repayments under line of credit |
|
(7,500 |
) |
(4,000 |
) | ||
|
Tax withholding payments reimbursed by restricted shares |
|
(490 |
) |
(127 |
) | ||
|
Excess tax benefits from share-based compensation |
|
55 |
|
87 |
| ||
|
Repurchase of common stock |
|
(19,318 |
) |
(10,810 |
) | ||
|
Net cash used in financing activities |
|
(18,380 |
) |
(10,548 |
) | ||
|
|
|
|
|
|
| ||
|
Effect of foreign exchange rates on cash and cash equivalents |
|
(80 |
) |
(565 |
) | ||
|
|
|
|
|
|
| ||
|
Net decrease in cash and cash equivalents |
|
(12,955 |
) |
(27,196 |
) | ||
|
Cash and cash equivalents at beginning of period |
|
38,139 |
|
48,199 |
| ||
|
|
|
|
|
|
| ||
|
Cash and cash equivalents at end of period |
|
$ |
25,184 |
|
$ |
21,003 |
|
|
|
|
|
|
|
| ||
|
Supplemental cash flow information: |
|
|
|
|
| ||
|
Cash paid for income taxes |
|
$ |
3,959 |
|
$ |
8,227 |
|
|
Cash paid for interest |
|
$ |
327 |
|
$ |
240 |
|
|
Issuance of common stock for acquired business |
|
$ |
44 |
|
$ |
42 |
|
|
Purchases of property and equipment not yet paid for |
|
$ |
1,234 |
|
$ |
3,858 |
|
|
Asset retirement obligations |
|
$ |
1,479 |
|
$ |
— |
|
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
Exhibit 99.2
FINAL FOR RELEASE
CHARLES RIVER ASSOCIATES (CRA)
THIRD QUARTER FISCAL YEAR 2016
EARNINGS ANNOUNCEMENT
PREPARED CFO REMARKS
CRA is providing these prepared remarks by CFO Chad Holmes in combination with its press release. These remarks are offered to provide the investment community with additional information on CRA’s financial results prior to the start of the conference call. As previously announced, the conference call will be held October 27, 2016 at 10:00 a.m. ET. These prepared remarks will not be read on the call.
Q3 2016 Summary (Quarter ended October 1, 2016)
· Revenue and non-GAAP revenue: $81.7 million
· Net income: $3.2 million, or 3.9% of revenue; Non-GAAP net income: $3.2 million, or 4.0% of non-GAAP revenue
· Earnings per diluted share: $0.38; Non-GAAP earnings per diluted share: $0.39
· Operating margin: 6.5%; Non-GAAP operating margin: 6.6%
· Effective tax rate: 37.7%; Non-GAAP effective tax rate: 37.0%
· Utilization: 73%
· Cash and cash equivalents: $25.2 million at October 1, 2016
· Non-GAAP Adjusted EBITDA: $13.8 million, or 16.8% of non-GAAP revenue
· Consultant headcount at the end of Q3 of 2016: 541, which consisted of 115 officers, 270 other senior staff, and 156 junior staff
Revenue
Revenue was $81.7 million for Q3 of fiscal 2016, compared with revenue of $76.5 million for Q3 of fiscal 2015. Revenue for Q3 of fiscal 2016 included zero contribution from GNU (formerly known as “NeuCo”; see more details in the “Non-GAAP Financial Measures” section). Revenue for Q3 of fiscal 2015 included $1.1 million from GNU. Non-GAAP revenue was $81.7 million for Q3 of fiscal 2016, compared with non-GAAP revenue of $75.5 million for Q3 of fiscal 2015.
Headcount
The following table outlines our consultant headcount at the end of the stated quarters:
|
|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
|
Officers |
|
115 |
|
117 |
|
118 |
|
122 |
|
121 |
|
|
Other Senior Staff |
|
270 |
|
254 |
|
261 |
|
267 |
|
265 |
|
|
Junior Staff |
|
156 |
|
122 |
|
120 |
|
122 |
|
121 |
|
|
Total |
|
541 |
|
493 |
|
499 |
|
511 |
|
507 |
|
Utilization
Utilization on a firm-wide basis in Q3 of fiscal 2016 was 73%. This compares with 73% in Q3 of fiscal 2015 and 76% in Q2 of fiscal 2016.
Gross Margin
Gross margin in Q3 of fiscal 2016 was 29.2%, compared with 32.0% in Q3 of fiscal 2015. Non-GAAP gross margin for Q3 of fiscal 2016 was 29.2%, compared with 31.5% in Q3 of fiscal 2015. Client reimbursable expenses, on a GAAP and non-GAAP basis, were 11.0% of revenue in Q3 of fiscal 2016, compared with 11.0% of revenue on a GAAP basis and 11.1% on a non-GAAP basis in Q3 of fiscal 2015.
SG&A Expenses
For Q3 of fiscal 2016, SG&A expenses were $16.7 million, or 20.4% of revenue, compared with SG&A expenses of $18.4 million, or 24.0% of revenue, in Q3 of fiscal 2015. Non-GAAP SG&A expenses were $16.6 million, or 20.3% of non-GAAP revenue, in Q3 of fiscal 2016, compared with $17.6 million, or 23.3% of non-GAAP revenue, in Q3 of fiscal 2015.
Commissions to non-employee experts are included in SG&A. On a GAAP and non-GAAP basis, those commissions represented approximately 2.4% of revenue in Q3 of fiscal 2016, compared with approximately 4.1% of revenue in Q3 of fiscal 2015. Excluding these commissions, SG&A expenses were 17.9% of GAAP revenue in Q3 of fiscal 2016 and 19.9% of revenue in Q3 of fiscal 2015, and non-GAAP SG&A expenses were 17.9% of non-GAAP revenue in Q3 of fiscal 2016 and 19.2% of non-GAAP revenue in Q3 of fiscal 2015.
Depreciation & Amortization
On a GAAP and non-GAAP basis, depreciation and amortization expense was $1.9 million for Q3 of fiscal 2016, compared with $1.6 million for Q3 of fiscal 2015.
Share-Based Compensation Expense
On a GAAP and non-GAAP basis, share-based compensation expense was approximately $1.7 million for Q3 of fiscal 2016, compared with $1.4 million for Q3 of fiscal 2015.
Operating Income
Operating income was $5.3 million, or 6.5% of revenue, in Q3 of fiscal 2016, compared with operating income of $4.6 million, or 6.0% of revenue, in Q3 of fiscal 2015. Non-GAAP operating income was $5.4 million, or 6.6% of non-GAAP revenue, for Q3 of fiscal 2016, compared with $4.6 million, or 6.1% of non-GAAP revenue, for Q3 of fiscal 2015.
Income Taxes
The following table outlines our income tax provision recorded and the resulting effective tax rates (in $000):
|
|
|
GAAP |
|
NON-GAAP |
| ||||||||
|
|
|
Q3 |
|
Q3 |
| ||||||||
|
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
| ||||
|
Tax Provision |
|
$ |
1,909 |
|
$ |
1,533 |
|
$ |
1,909 |
|
$ |
1,491 |
|
|
Effective Tax Rate |
|
37.7 |
% |
35.3 |
% |
37.0 |
% |
33.8 |
% | ||||
Net Income
Net income for Q3 of fiscal 2016 was $3.2 million, or 3.9% of revenue, or $0.38 per diluted share, compared with net income of $2.9 million, or 3.7% of revenue, or $0.31 per diluted share, for Q3 of fiscal 2015. Non-GAAP net income for Q3 of fiscal 2016 was $3.2 million, or 4.0% of non-GAAP revenue, or $0.39 per diluted share, compared with $2.9 million, or 3.9% of non-GAAP revenue, or $0.32 per diluted share, for Q3 of fiscal 2015.
Non-GAAP Adjusted EBITDA
Non-GAAP Adjusted EBITDA for Q3 of fiscal 2016 was $13.8 million, or 16.8% of non-GAAP revenue, compared with $11.8 million, or 15.6% of non-GAAP revenue, for Q3 of fiscal 2015. See the exhibit to CRA’s press release and the information provided below under the heading “Non-GAAP Financial Measures” for more details regarding the calculation of non-GAAP Adjusted EBITDA.
Constant Currency Basis
On a constant currency basis relative to Q3 of fiscal 2015, Q3 of fiscal 2016 revenue would have increased by approximately $2.2 million to $83.9 million, and net income would have increased by roughly $0.1 million to $3.3 million, or to 3.9% of revenue, or by approximately $0.01 per diluted share to $0.39 per diluted share.
On a constant currency basis relative to Q3 of fiscal 2015, Q3 of fiscal 2016 non-GAAP revenue would have increased by approximately $2.2 million to approximately $83.9 million; Q3 of fiscal 2016 non-GAAP net income would have increased by approximately $0.1 million to $3.3 million; non-GAAP earnings per diluted share for Q3 of fiscal 2016 would have remained unchanged at $0.39 per diluted share; and Q3 of fiscal 2016 non-GAAP Adjusted EBITDA would have increased by approximately $0.2 million to $14.0 million, or to 16.7% of non-GAAP
revenue adjusted on a constant currency basis. A description of the process for calculating the measures presented on a constant currency basis is contained under the heading “Non-GAAP Financial Measures” below.
Key Balance Sheet Metrics
Billed and unbilled receivables at October 1, 2016 were $100.0 million, compared with $93.5 million at October 3, 2015. Current liabilities at October 1, 2016 were $80.2 million, compared with $75.9 million at October 3, 2015.
Total DSO in Q3 of fiscal 2016 were 108 days, consisting of 67 days of billed and 41 days of unbilled. This compares with 109 days we reported in Q3 of fiscal 2015, consisting of 69 days of billed and 40 days of unbilled; and 101 days in Q2 of fiscal 2016, consisting of 68 days of billed and 33 days of unbilled.
Cash and Cash Flow
Cash and cash equivalents were $25.2 million at October 1, 2016, compared with $21.0 million at October 3, 2015.
Capital expenditures totaled approximately $5.1 million in Q3 of fiscal 2016, compared with $4.2 million in Q3 of fiscal 2015.
During Q3 of fiscal 2016, approximately 111,000 shares of common stock were repurchased for approximately $2.9 million. During Q3 of fiscal 2015, approximately 125,000 shares of common stock were repurchased for approximately $2.8 million.
This concludes the prepared CFO remarks.
NON-GAAP FINANCIAL MEASURES
In addition to reporting its financial results in accordance with U.S. generally accepted accounting principles, or GAAP, CRA has also provided in these remarks and accompanying financial tables non-GAAP financial information. CRA believes that the use of non-GAAP measures in addition to GAAP measures is a useful method of evaluating its results of operations. CRA believes that presenting its financial results excluding the results of GNU123 Liquidating Corporation (“GNU”) formerly known as “NeuCo,” certain non-cash and/or non-recurring charges, and the other items identified below, and including presentations of Adjusted EBITDA and comparisons on a constant currency basis, is important to investors and management because they are more indicative of CRA’s 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 results calculated in accordance with GAAP and reconciliations to those results should be carefully evaluated. The non-GAAP financial measures used by CRA may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. Specifically, for the third quarter of fiscal 2016, the third quarter of fiscal 2015, and the year-to-date period ended as of the third quarter of fiscal 2016, CRA has excluded GNU results, and for the year-to-date period ended as of the third quarter of 2015, CRA has excluded
GNU’s results and a non-cash charge relating to an increased liability for a future contingent consideration payment relating to a prior acquisition.
Also, in calculating “Adjusted EBITDA” from net income (loss) attributable to CRA for these fiscal periods, CRA has excluded net income (loss) attributable to noncontrolling interests (net of tax), interest expense, net; provision for income taxes, other income (expense), net; and the following non-cash expenses: depreciation and amortization, share-based compensation expenses, and amortization of forgivable loans.
Finally, CRA also believes that fluctuations in foreign currency exchange rates can significantly affect its financial results. Therefore, CRA provides a constant currency presentation to supplement disclosures regarding its results of operations and performance. CRA calculates constant currency amounts by converting its applicable fiscal period local currency financial results using the prior fiscal year’s corresponding period exchange rates. CRA has presented in these remarks its GAAP and non-GAAP revenue, net income, net income margin, and earnings per diluted share and its Adjusted EBITDA and Adjusted EBITDA margin for the third quarter of fiscal 2016 on a constant currency basis relative to the third quarter of fiscal 2015.
A reconciliation between the historical GAAP and non-GAAP financial measures presented in these remarks is provided in the financial tables below.
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS INCLUDING A RECONCILIATION TO NON-GAAP RESULTS
FOR THE QUARTER ENDED OCTOBER 1, 2016 COMPARED TO THE QUARTER ENDED OCTOBER 3, 2015
(In thousands, except per share data)
|
|
|
Quarter Ended October 1, 2016 |
|
Quarter Ended October 3, 2015 |
| ||||||||||||||||||||||
|
|
|
|
|
GAAP |
|
Adjustments to |
|
|
|
Non-GAAP |
|
|
|
GAAP |
|
Adjustments to |
|
|
|
Non-GAAP |
| ||||||
|
|
|
GAAP |
|
% of |
|
GAAP Results |
|
Non-GAAP |
|
% of |
|
GAAP |
|
% of |
|
GAAP Results |
|
Non-GAAP |
|
% of |
| ||||||
|
|
|
Results |
|
Revenues |
|
(GNU) (1) |
|
Results |
|
Revenues |
|
Results |
|
Revenues |
|
(GNU) (1) |
|
Results |
|
Revenues |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Revenues |
|
$ |
81,691 |
|
100.0 |
% |
$ |
— |
|
$ |
81,691 |
|
100.0 |
% |
$ |
76,525 |
|
100.0 |
% |
$ |
1,055 |
|
$ |
75,470 |
|
100.0 |
% |
|
Costs of services |
|
57,832 |
|
70.8 |
% |
— |
|
57,832 |
|
70.8 |
% |
52,029 |
|
68.0 |
% |
334 |
|
51,695 |
|
68.5 |
% | ||||||
|
Gross profit |
|
23,859 |
|
29.2 |
% |
— |
|
23,859 |
|
29.2 |
% |
24,496 |
|
32.0 |
% |
721 |
|
23,775 |
|
31.5 |
% | ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Selling, general and administrative expenses |
|
16,671 |
|
20.4 |
% |
95 |
|
16,576 |
|
20.3 |
% |
18,355 |
|
24.0 |
% |
772 |
|
17,583 |
|
23.3 |
% | ||||||
|
Depreciation and amortization |
|
1,891 |
|
2.3 |
% |
— |
|
1,891 |
|
2.3 |
% |
1,560 |
|
2.0 |
% |
— |
|
1,560 |
|
2.1 |
% | ||||||
|
Income (loss) from operations |
|
5,297 |
|
6.5 |
% |
(95 |
) |
5,392 |
|
6.6 |
% |
4,581 |
|
6.0 |
% |
(51 |
) |
4,632 |
|
6.1 |
% | ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Interest and other (expense), net |
|
(237 |
) |
-0.3 |
% |
— |
|
(237 |
) |
-0.3 |
% |
(235 |
) |
-0.3 |
% |
(14 |
) |
(221 |
) |
-0.3 |
% | ||||||
|
Income (loss) before provision for income taxes and noncontrolling interest |
|
5,060 |
|
6.2 |
% |
(95 |
) |
5,155 |
|
6.3 |
% |
4,346 |
|
5.7 |
% |
(65 |
) |
4,411 |
|
5.8 |
% | ||||||
|
Provision for income taxes |
|
(1,909 |
) |
-2.3 |
% |
— |
|
(1,909 |
) |
-2.3 |
% |
(1,533 |
) |
-2.0 |
% |
(42 |
) |
(1,491 |
) |
-2.0 |
% | ||||||
|
Net income (loss) |
|
3,151 |
|
3.9 |
% |
(95 |
) |
3,246 |
|
4.0 |
% |
2,813 |
|
3.7 |
% |
(107 |
) |
2,920 |
|
3.9 |
% | ||||||
|
Net (income) loss attributable to noncontrolling interests, net of tax |
|
42 |
|
0.1 |
% |
42 |
|
— |
|
0.0 |
% |
47 |
|
0.1 |
% |
47 |
|
— |
|
0.0 |
% | ||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
3,193 |
|
3.9 |
% |
$ |
(53 |
) |
$ |
3,246 |
|
4.0 |
% |
$ |
2,860 |
|
3.7 |
% |
$ |
(60 |
) |
$ |
2,920 |
|
3.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Net Income per share attributable to CRA International, Inc.: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Basic |
|
$ |
0.39 |
|
|
|
|
|
$ |
0.39 |
|
|
|
$ |
0.32 |
|
|
|
|
|
$ |
0.33 |
|
|
| ||
|
Diluted |
|
$ |
0.38 |
|
|
|
|
|
$ |
0.39 |
|
|
|
$ |
0.31 |
|
|
|
|
|
$ |
0.32 |
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Weighted average number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Basic |
|
8,177 |
|
|
|
|
|
8,177 |
|
|
|
8,940 |
|
|
|
|
|
8,940 |
|
|
| ||||||
|
Diluted |
|
8,309 |
|
|
|
|
|
8,309 |
|
|
|
9,025 |
|
|
|
|
|
9,025 |
|
|
| ||||||
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS INCLUDING A RECONCILIATION TO NON-GAAP RESULTS
FOR THE YEAR-TO-DATE PERIOD ENDED OCTOBER 1, 2016 COMPARED TO THE YEAR-TO-DATE PERIOD ENDED OCTOBER 3, 2015
(In thousands, except per share data)
|
|
|
Year-To-Date Period Ended October 1, 2016 |
|
Year-To-Date Period Ended October 3, 2015 |
| |||||||||||||||||||||||||
|
|
|
|
|
GAAP |
|
Adjustments to |
|
|
|
Non-GAAP |
|
|
|
GAAP |
|
Adjustments to |
|
Adjustments to |
|
|
|
Non-GAAP |
| |||||||
|
|
|
GAAP |
|
% of |
|
GAAP Results |
|
Non-GAAP |
|
% of |
|
GAAP |
|
% of |
|
GAAP Results |
|
GAAP Results |
|
Non-GAAP |
|
% of |
| |||||||
|
|
|
Results |
|
Revenues |
|
(GNU) (1) |
|
Results |
|
Revenues |
|
Results |
|
Revenues |
|
(Contingent Liability) (2) |
|
(GNU) (1) |
|
Results |
|
Revenues |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Revenues |
|
$ |
245,210 |
|
100.0 |
% |
$ |
826 |
|
$ |
244,384 |
|
100.0 |
% |
$ |
231,099 |
|
100.0 |
% |
$ |
— |
|
$ |
2,859 |
|
$ |
228,240 |
|
100.0 |
% |
|
Costs of services |
|
171,297 |
|
69.9 |
% |
455 |
|
170,842 |
|
69.9 |
% |
156,523 |
|
67.7 |
% |
833 |
|
1,040 |
|
154,650 |
|
67.8 |
% | |||||||
|
Gross profit |
|
73,913 |
|
30.1 |
% |
371 |
|
73,542 |
|
30.1 |
% |
74,576 |
|
32.3 |
% |
(833 |
) |
1,819 |
|
73,590 |
|
32.2 |
% | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Selling, general and administrative expenses |
|
52,748 |
|
21.5 |
% |
1,144 |
|
51,604 |
|
21.1 |
% |
55,105 |
|
23.8 |
% |
— |
|
2,405 |
|
52,700 |
|
23.1 |
% | |||||||
|
Depreciation and amortization |
|
5,861 |
|
2.4 |
% |
— |
|
5,861 |
|
2.4 |
% |
4,766 |
|
2.1 |
% |
— |
|
— |
|
4,766 |
|
2.1 |
% | |||||||
|
Income (loss) from operations |
|
15,304 |
|
6.2 |
% |
(773 |
) |
16,077 |
|
6.6 |
% |
14,705 |
|
6.4 |
% |
(833 |
) |
(586 |
) |
16,124 |
|
7.1 |
% | |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Interest and other income (expense), net |
|
3,210 |
|
1.3 |
% |
3,828 |
|
(618 |
) |
-0.3 |
% |
(337 |
) |
-0.1 |
% |
— |
|
570 |
|
(907 |
) |
-0.4 |
% | |||||||
|
Income (loss) before provision for income taxes and noncontrolling interest |
|
18,514 |
|
7.6 |
% |
3,055 |
|
15,459 |
|
6.3 |
% |
14,368 |
|
6.2 |
% |
(833 |
) |
(16 |
) |
15,217 |
|
6.7 |
% | |||||||
|
Provision for income taxes |
|
(6,357 |
) |
-2.6 |
% |
(308 |
) |
(6,049 |
) |
-2.5 |
% |
(5,454 |
) |
-2.4 |
% |
— |
|
(97 |
) |
(5,357 |
) |
-2.3 |
% | |||||||
|
Net income (loss) |
|
12,157 |
|
5.0 |
% |
2,747 |
|
9,410 |
|
3.9 |
% |
8,914 |
|
3.9 |
% |
(833 |
) |
(113 |
) |
9,860 |
|
4.3 |
% | |||||||
|
Net (income) loss attributable to noncontrolling interests, net of tax |
|
(1,327 |
) |
-0.5 |
% |
(1,327 |
) |
— |
|
0.0 |
% |
50 |
|
0.0 |
% |
— |
|
50 |
|
— |
|
0.0 |
% | |||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
10,830 |
|
4.4 |
% |
$ |
1,420 |
|
$ |
9,410 |
|
3.9 |
% |
$ |
8,964 |
|
3.9 |
% |
$ |
(833 |
) |
$ |
(63 |
) |
$ |
9,860 |
|
4.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Net Income per share attributable to CRA International, Inc.: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Basic |
|
$ |
1.25 |
|
|
|
|
|
$ |
1.09 |
|
|
|
$ |
0.98 |
|
|
|
|
|
|
|
$ |
1.08 |
|
|
| |||
|
Diluted |
|
$ |
1.24 |
|
|
|
|
|
$ |
1.08 |
|
|
|
$ |
0.97 |
|
|
|
|
|
|
|
$ |
1.06 |
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Weighted average number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Basic |
|
8,581 |
|
|
|
|
|
8,581 |
|
|
|
9,055 |
|
|
|
|
|
|
|
9,055 |
|
|
| |||||||
|
Diluted |
|
8,653 |
|
|
|
|
|
8,653 |
|
|
|
9,182 |
|
|
|
|
|
|
|
9,182 |
|
|
| |||||||
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
(2) This adjustment includes activity related to an increase in the liability for future contingent consideration payments in connection with a previous acquisition.
CRA INTERNATIONAL, INC.
UNAUDITED ADJUSTED EBITDA INCLUDING A RECONCILIATION TO NON-GAAP ADJUSTED EBITDA
FOR THE QUARTER AND YEAR-TO-DATE PERIOD ENDED OCTOBER 1, 2016 COMPARED TO THE QUARTER AND YEAR-TO-DATE PERIOD ENDED OCTOBER 3, 2015
(In thousands)
|
|
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
| |||||||
|
|
|
Quarter Ended |
|
% of |
|
GAAP Results |
|
Quarter Ended |
|
% of |
|
Quarter Ended |
|
% of |
|
GAAP Results |
|
GAAP Results |
|
Quarter Ended |
|
% of |
| |||||||
|
|
|
October 1, 2016 |
|
Revenues |
|
(GNU) (1) |
|
October 1, 2016 |
|
Revenues |
|
October 3, 2015 |
|
Revenues |
|
(Contingent Liability) (2) |
|
(GNU) (1) |
|
October 3, 2015 |
|
Revenues |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Revenues |
|
$ |
81,691 |
|
100.0 |
% |
$ |
— |
|
$ |
81,691 |
|
100.0 |
% |
$ |
76,525 |
|
100.0 |
% |
$ |
— |
|
$ |
1,055 |
|
$ |
75,470 |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
3,193 |
|
3.9 |
% |
$ |
(53 |
) |
$ |
3,246 |
|
4.0 |
% |
$ |
2,860 |
|
3.7 |
% |
$ |
— |
|
$ |
(60 |
) |
$ |
2,920 |
|
3.9 |
% |
|
Net (loss) attributable to noncontrolling interest, net of tax |
|
(42 |
) |
0.1 |
% |
(42 |
) |
— |
|
0.0 |
% |
(47 |
) |
-0.1 |
% |
— |
|
(47 |
) |
— |
|
0.0 |
% | |||||||
|
Net income (loss) |
|
3,151 |
|
3.9 |
% |
(95 |
) |
3,246 |
|
4.0 |
% |
2,813 |
|
3.7 |
% |
— |
|
(107 |
) |
2,920 |
|
3.9 |
% | |||||||
|
Interest expense,net |
|
129 |
|
0.2 |
% |
— |
|
129 |
|
0.2 |
% |
140 |
|
0.2 |
% |
— |
|
14 |
|
126 |
|
0.2 |
% | |||||||
|
Provision for income taxes |
|
1,909 |
|
2.3 |
% |
— |
|
1,909 |
|
2.3 |
% |
1,533 |
|
2.0 |
% |
— |
|
42 |
|
1,491 |
|
2.0 |
% | |||||||
|
Depreciation and amortization |
|
1,891 |
|
2.3 |
% |
— |
|
1,891 |
|
2.3 |
% |
1,560 |
|
2.0 |
% |
— |
|
— |
|
1,560 |
|
2.1 |
% | |||||||
|
EBITDA |
|
7,080 |
|
8.7 |
% |
(95 |
) |
7,175 |
|
8.8 |
% |
6,044 |
|
7.9 |
% |
— |
|
(51 |
) |
6,097 |
|
8.1 |
% | |||||||
|
Share-based compensation expenses |
|
1,687 |
|
2.1 |
% |
— |
|
1,687 |
|
2.1 |
% |
1,405 |
|
1.8 |
% |
— |
|
— |
|
1,405 |
|
1.9 |
% | |||||||
|
Amortization of forgivable loans |
|
4,784 |
|
5.9 |
% |
— |
|
4,784 |
|
5.9 |
% |
4,190 |
|
5.5 |
% |
— |
|
— |
|
4,190 |
|
5.6 |
% | |||||||
|
Other expense, net |
|
108 |
|
0.1 |
% |
— |
|
108 |
|
0.1 |
% |
95 |
|
0.1 |
% |
— |
|
— |
|
95 |
|
0.1 |
% | |||||||
|
Adjusted EBITDA |
|
$ |
13,659 |
|
16.7 |
% |
$ |
(95 |
) |
$ |
13,754 |
|
16.8 |
% |
$ |
11,736 |
|
15.3 |
% |
$ |
— |
|
$ |
(51 |
) |
$ |
11,787 |
|
15.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
|
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
|
GAAP |
|
GAAP |
|
Adjustments to |
|
Adjustments to |
|
Non-GAAP |
|
Non-GAAP |
| |||||||
|
|
|
Year-to-Date Period Ended |
|
% of |
|
GAAP Results |
|
Year-to-Date Period Ended |
|
% of |
|
Year-to-Date Period Ended |
|
% of |
|
GAAP Results |
|
GAAP Results |
|
Year-to-Date Period Ended |
|
% of |
| |||||||
|
|
|
October 1, 2016 |
|
Revenues |
|
(GNU) (1) |
|
October 1, 2016 |
|
Revenues |
|
October 3, 2015 |
|
Revenues |
|
(Contingent Liability) (2) |
|
(GNU) (1) |
|
October 3, 2015 |
|
Revenues |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Revenues |
|
$ |
245,210 |
|
100.0 |
% |
$ |
826 |
|
$ |
244,384 |
|
100.0 |
% |
$ |
231,099 |
|
100.0 |
% |
$ |
— |
|
$ |
2,859 |
|
$ |
228,240 |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
|
Net income (loss) attributable to CRA International, Inc. |
|
$ |
10,830 |
|
4.4 |
% |
$ |
1,420 |
|
$ |
9,410 |
|
3.9 |
% |
$ |
8,964 |
|
3.9 |
% |
$ |
(833 |
) |
$ |
(63 |
) |
$ |
9,860 |
|
4.3 |
% |
|
Net income (loss) attributable to noncontrolling interest, net of tax |
|
1,327 |
|
0.5 |
% |
1,327 |
|
— |
|
0.0 |
% |
(50 |
) |
0.0 |
% |
— |
|
(50 |
) |
— |
|
0.0 |
% | |||||||
|
Net income (loss) |
|
12,157 |
|
5.0 |
% |
2,747 |
|
9,410 |
|
3.9 |
% |
8,914 |
|
3.9 |
% |
(833 |
) |
(113 |
) |
9,860 |
|
4.3 |
% | |||||||
|
Interest expense,net |
|
356 |
|
0.1 |
% |
7 |
|
349 |
|
0.1 |
% |
403 |
|
0.2 |
% |
— |
|
35 |
|
368 |
|
0.2 |
% | |||||||
|
Provision for income taxes |
|
6,357 |
|
2.6 |
% |
308 |
|
6,049 |
|
2.5 |
% |
5,454 |
|
2.4 |
% |
— |
|
97 |
|
5,357 |
|
2.3 |
% | |||||||
|
Depreciation and amortization |
|
5,861 |
|
2.4 |
% |
— |
|
5,861 |
|
2.4 |
% |
4,766 |
|
2.1 |
% |
— |
|
— |
|
4,766 |
|
2.1 |
% | |||||||
|
EBITDA |
|
24,731 |
|
10.1 |
% |
3,062 |
|
21,669 |
|
8.9 |
% |
19,537 |
|
8.5 |
% |
(833 |
) |
19 |
|
20,351 |
|
8.9 |
% | |||||||
|
Share-based compensation expenses |
|
4,786 |
|
2.0 |
% |
— |
|
4,786 |
|
2.0 |
% |
4,403 |
|
1.9 |
% |
— |
|
— |
|
4,403 |
|
1.9 |
% | |||||||
|
Amortization of forgivable loans |
|
14,024 |
|
5.7 |
% |
— |
|
14,024 |
|
5.7 |
% |
11,690 |
|
5.1 |
% |
— |
|
— |
|
11,690 |
|
5.1 |
% | |||||||
|
Other income (expense),net |
|
(3,566 |
) |
-1.5 |
% |
(3,836 |
) |
270 |
|
0.1 |
% |
(66 |
) |
0.0 |
% |
— |
|
(605 |
) |
539 |
|
0.2 |
% | |||||||
|
Adjusted EBITDA |
|
$ |
39,975 |
|
16.3 |
% |
$ |
(774 |
) |
$ |
40,749 |
|
16.7 |
% |
$ |
35,564 |
|
15.4 |
% |
$ |
(833 |
) |
$ |
(586 |
) |
$ |
36,983 |
|
16.2 |
% |
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.
(2) This adjustment includes activity related to an increase in the liability for future contingent consideration payments in connection with a previous acquisition.
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
|
|
|
October 1, |
|
January 2, |
| ||
|
|
|
2016 |
|
2016 |
| ||
|
|
|
|
|
|
| ||
|
Assets |
|
|
|
|
| ||
|
Cash and cash equivalents |
|
$ |
25,184 |
|
$ |
38,139 |
|
|
Accounts receivable and unbilled, net |
|
99,995 |
|
86,377 |
| ||
|
Other current assets |
|
17,895 |
|
16,278 |
| ||
|
Total current assets |
|
143,074 |
|
140,794 |
| ||
|
|
|
|
|
|
| ||
|
Property and equipment, net |
|
38,801 |
|
31,338 |
| ||
|
Goodwill and intangible assets, net |
|
78,373 |
|
80,561 |
| ||
|
Other assets |
|
49,325 |
|
61,024 |
| ||
|
Total assets |
|
$ |
309,573 |
|
$ |
313,717 |
|
|
|
|
|
|
|
| ||
|
Liabilities and shareholders’ equity |
|
|
|
|
| ||
|
Current liabilities |
|
$ |
80,244 |
|
$ |
86,458 |
|
|
Long-term liabilities |
|
22,107 |
|
16,191 |
| ||
|
Total liabilities |
|
102,351 |
|
102,649 |
| ||
|
|
|
|
|
|
| ||
|
Total shareholders’ equity |
|
207,222 |
|
211,068 |
| ||
|
Total liabilities and shareholders’ equity |
|
$ |
309,573 |
|
$ |
313,717 |
|
CRA INTERNATIONAL, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
|
|
|
Fiscal Year-to-Date |
|
Fiscal Year-to-Date |
| ||
|
|
|
October 1, |
|
October 3, |
| ||
|
|
|
2016 |
|
2015 |
| ||
|
Operating activities: |
|
|
|
|
| ||
|
Net income |
|
$ |
12,157 |
|
$ |
8,914 |
|
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities, net of effect of acquired businesses: |
|
|
|
|
| ||
|
GNU gain on sale of business (1) |
|
(3,836 |
) |
— |
| ||
|
Non-cash items, net |
|
14,476 |
|
13,707 |
| ||
|
Accounts receivable and unbilled services |
|
(15,501 |
) |
(11,765 |
) | ||
|
Working capital items, net |
|
8,917 |
|
(15,720 |
) | ||
|
Net cash provided by (used in) operating activities |
|
16,213 |
|
(4,864 |
) | ||
|
|
|
|
|
|
| ||
|
Investing activities: |
|
|
|
|
| ||
|
Purchase of property and equipment |
|
(11,808 |
) |
(12,696 |
) | ||
|
GNU cash proceeds from sale of business assets |
|
1,100 |
|
— |
| ||
|
Collections on notes receivable |
|
— |
|
1,554 |
| ||
|
Payments on notes receivable |
|
— |
|
(77 |
) | ||
|
Net cash used in investing activities |
|
(10,708 |
) |
(11,219 |
) | ||
|
|
|
|
|
|
| ||
|
Financing activities: |
|
|
|
|
| ||
|
Issuance of common stock, principally stock option exercises |
|
1,448 |
|
602 |
| ||
|
Payments on notes payable |
|
(75 |
) |
(300 |
) | ||
|
Borrowings under line of credit |
|
7,500 |
|
4,000 |
| ||
|
Repayments under line of credit |
|
(7,500 |
) |
(4,000 |
) | ||
|
Tax withholding payments reimbursed by restricted shares |
|
(490 |
) |
(127 |
) | ||
|
Excess tax benefits from share-based compensation |
|
55 |
|
87 |
| ||
|
Repurchase of common stock |
|
(19,318 |
) |
(10,810 |
) | ||
|
Net cash used in financing activities |
|
(18,380 |
) |
(10,548 |
) | ||
|
|
|
|
|
|
| ||
|
Effect of foreign exchange rates on cash and cash equivalents |
|
(80 |
) |
(565 |
) | ||
|
|
|
|
|
|
| ||
|
Net decrease in cash and cash equivalents |
|
(12,955 |
) |
(27,196 |
) | ||
|
Cash and cash equivalents at beginning of period |
|
38,139 |
|
48,199 |
| ||
|
|
|
|
|
|
| ||
|
Cash and cash equivalents at end of period |
|
$ |
25,184 |
|
$ |
21,003 |
|
|
|
|
|
|
|
| ||
|
Supplemental cash flow information: |
|
|
|
|
| ||
|
Cash paid for income taxes |
|
$ |
3,959 |
|
$ |
8,227 |
|
|
Cash paid for interest |
|
$ |
327 |
|
$ |
240 |
|
|
Issuance of common stock for acquired business |
|
$ |
44 |
|
$ |
42 |
|
|
Purchases of property and equipment not yet paid for |
|
$ |
1,234 |
|
$ |
3,858 |
|
|
Asset retirement obligations |
|
$ |
1,479 |
|
$ |
— |
|
(1) These adjustments include activity related to GNU123 Liquidating Corporation (“GNU”), CRA’s majority owned subsidiary formerly known as “NeuCo”, in the Company’s GAAP results. In April 2016, substantially all of GNU’s assets were sold.