Charles River Associates Reports Financial Results for the Third Quarter Of 2020

10/29/20

BOSTON--(BUSINESS WIRE)--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 September 26, 2020.

Key Third-Quarter Fiscal 2020 Highlights

  • Revenue grew 5.3% year over year to $121.8 million.
  • Utilization was 69%, while quarter-end headcount increased 11.5% year over year.
  • Net income was $5.4 million, or 4.4% of revenue, compared with $5.7 million, or 5.0% of revenue, in the third quarter of fiscal 2019; non-GAAP net income was $6.1 million, or 5.0% of revenue, compared with $7.9 million, or 6.9% of revenue, in the third quarter of fiscal 2019.
  • Earnings per diluted share were $0.68, compared with $0.71 in the third quarter of fiscal 2019; non-GAAP earnings per diluted share were $0.76, compared with $0.98 in the third quarter of fiscal 2019.
  • Non-GAAP EBITDA was $12.0 million, or 9.8% of revenue, compared with $12.6 million, or 10.9% of revenue, in the third quarter of fiscal 2019.
  • On a constant currency basis relative to the third quarter of fiscal 2019, revenue would have been lower by $0.9 million, GAAP net income and earnings per diluted share would have been lower by $0.2 million and $0.02, respectively. Non-GAAP net income, earnings per diluted share and EBITDA would have been lower by $0.2 million, $0.02 per diluted share, $0.2 million, respectively.
  • CRA returned $6.8 million of capital to its shareholders, consisting of $1.8 million of dividend payments and $5.0 million for share repurchases of approximately 110,000 shares.

Management Commentary and Financial Guidance

“Against a challenging economic backdrop, CRA again demonstrated its ability to generate strong cash flows, providing funds to support the growth of the business and return capital to shareholders,” said Paul Maleh, CRA’s President and Chief Executive Officer. “Highlighting the resiliency of our company, CRA delivered year-over-year revenue growth for the 19th consecutive quarter. CRA continued to invest in our practices by increasing headcount by 11.5% year over year, while at the same time reducing its borrowings by $21.0 million and increasing its cash balance by 28% compared to the second quarter of fiscal 2020. CRA also repurchased 110,000 shares of its common stock during the third quarter and today announced a 13% increase in its quarterly cash dividend.”

“Building on a record fiscal 2019 and first half of fiscal 2020, CRA produced growth across both the legal & regulatory and management consulting lines of business. Many of our practices generated revenue growth year over year, led by double-digit growth in each of our Energy, Finance, Forensic Services, and Risk, Investigations & Analytics practices. Geographically, we experienced balanced growth across our North American and international operations.”

“Through the first three quarters of fiscal 2020, on a constant currency basis relative to fiscal 2019, we have increased revenue by 11.8% to $371.1 million and non-GAAP EBITDA by 12.2% to $36.8 million, achieving a margin of 9.9%. Given the strength of our year-to-date performance and the growing momentum across our service portfolio, we are reinstating financial guidance for full-year fiscal 2020. On a constant currency basis relative to fiscal 2019, we expect revenue in the range of $498 million to $504 million and non-GAAP EBITDA margin in the range of 9.7% to 10.2%,” Maleh concluded.

CRA does not provide reconciliations of its annual non-GAAP EBITDA margin guidance to GAAP net income margin because CRA is unable to estimate with reasonable certainty the revaluation of contingent consideration liabilities, unusual gains or charges, foreign currency exchange rates, and the resulting effect of these items, and of equity awards, 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.

Quarterly Dividend

On October 29, 2020, CRA announced that it increased its quarterly cash dividend by 13% from $0.23 to $0.26 per common share. The dividend will be payable on December 11, 2020 to shareholders of record as of November 24, 2020. CRA expects to continue paying quarterly dividends, the declaration, timing and amounts of which remain subject to the discretion of CRA’s Board of Directors.

About Charles River Associates (CRA)

Charles River Associates® is a leading 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. 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.