WASHINGTON, Feb. 25, 2021 (GLOBE NEWSWIRE) -- FTI Consulting, Inc. (NYSE: FCN) today released financial results for the fourth quarter and full year ended December 31, 2020.

For the full year 2020, revenues of $2.461 billion increased $108.6 million, or 4.6%, compared to revenues of $2.353 billion in the prior year. Acquisition-related revenues contributed $40.7 million in full year 2020. Excluding acquisition-related revenues, the increase in revenues was primarily driven by higher demand in the Corporate Finance & Restructuring segment, which was partially offset by lower demand in the Forensic and Litigation Consulting segment, as well as a $38.5 million decline in pass-through revenues compared to the prior year. Net income of $210.7 million compared to $216.7 million in the prior year. The decrease in net income was due to higher compensation, primarily related to a 14.5% increase in billable headcount, which was partially offset by higher revenues, a lower effective tax rate, and a decline in selling, general and administrative ("SG&A") expenses compared to the prior year. Full year 2020 net income included a third quarter 2020 special charge of $7.1 million. Adjusted EBITDA of $332.3 million, or 13.5% of revenues, which excludes the special charge, compared to $343.9 million, or 14.6% of revenues, in the prior year.

Full year 2020 fully diluted earnings per share ("EPS") of $5.67 compared to $5.69 in the prior year. Full year 2020 EPS included the $7.1 million special charge, which reduced EPS by $0.14, and $9.1 million of non-cash interest expense related to the Company's 2.0% convertible senior notes due 2023 ("2023 Convertible Notes"), which decreased EPS by $0.18. Full year 2019 EPS included $8.6 million of non-cash interest expense related to the Company's 2023 Convertible Notes, which decreased EPS by $0.17, and a $2.1 million tax gain related to the sale of the Company's Ringtail e-discovery software and related business, which increased EPS by $0.06. Full year 2020 Adjusted EPS of $5.99, which excludes the special charge and non-cash interest expense, compared to Adjusted EPS of $5.80 in the prior year.

Steven H. Gunby, President and Chief Executive Officer of FTI Consulting, commented,"2020 was an incredibly difficult year for so many around the world. The success of FTI Consulting in the face of the economic and human stresses of COVID-19 speaks to the strength and dedication of our people, who supported each other and our clients in unprecedented ways while working remotely. Our resilience in such a difficult year underscores the power of this Company and the positive trajectory we are on.”

Cash Position and Capital Allocation
Net cash provided by operating activities of $327.1 million for the year ended December 31, 2020 compared to $217.9 million for the year ended December 31, 2019. The year-over-year increase in net cash provided by operating activities was largely due to higher cash collections, combined with lower non-compensation-related operating costs, which were partially offset by an increase in compensation, primarily related to headcount growth.

Cash and cash equivalents of $295.0 million at December 31, 2020 compared to $304.7 million at September 30, 2020 and $369.4 million at December 31, 2019. The sequential decrease in cash and cash equivalents was primarily driven by share repurchases in the fourth quarter. Total debt, net of cash, of $21.3 million at December 31, 2020 compared to $36.6 million at September 30, 2020 and ($53.1) million at December 31, 2019. The sequential decrease in total debt, net of cash, was primarily due to net cash provided by operating activities, which exceeded cash used for share repurchases and acquisitions.

During the quarter, the Company repurchased 1,598,540 shares of its common stock at an average price per share of $105.84 for a total cost of $169.2 million. In full year 2020, the Company repurchased 3,268,906 shares of its common stock at an average price per share of $108.11 for a total cost of $353.4 million. As of December 31, 2020, approximately $213.2 million remained available for common stock repurchases under the Company’s stock repurchase authorization.

Fourth Quarter 2020 Results

Fourth quarter 2020 revenues of $626.6 million increased $24.4 million, or 4.0%, compared to revenues of $602.2 million in the prior year quarter. Excluding the estimated positive impact from foreign currency translation ("FX"), revenues increased $17.6 million, or 2.9%, compared to the prior year quarter. The increase in revenues was driven by higher demand in the Corporate Finance & Restructuring, Economic Consulting and Technology segments, which was partially offset by lower demand in the Forensic and Litigation Consulting and Strategic Communications segments, as well as a $19.0 million decline in pass-through revenues compared to the prior year quarter. Net income of $55.6 million compared to $29.1 million in the prior year quarter. The increase in net income was primarily due to higher operating profits, particularly in the Economic Consulting and Corporate Finance & Restructuring segments and a lower effective tax rate. The lower effective tax rate was primarily related to a combined $11.2 million benefit from the use of foreign tax credits and a deferred tax benefit arising from an intracompany intellectual property license agreement. Adjusted EBITDA of $82.3 million, or 13.1% of revenues, compared to $58.3 million, or 9.7% of revenues, in the prior year quarter.

Fourth quarter 2020 EPS of $1.57 compared to $0.76 in the prior year quarter. The aforementioned $11.2 million tax benefit increased fourth quarter 2020 EPS and Adjusted EPS by $0.32. Fourth quarter 2020 EPS included $2.3 million of non-cash interest expense related to the Company's 2023 Convertible Notes, which reduced EPS by $0.04. Fourth quarter 2019 EPS included $2.2 million of non-cash interest expense related to the Company's 2023 Convertible Notes, which reduced EPS by $0.04. Fourth quarter 2020 Adjusted EPS of $1.61, which excludes the non-cash interest expense, compared to Adjusted EPS of $0.80 in the prior year quarter.

Fourth Quarter 2020 Segment Results

Corporate Finance & Restructuring
Revenues in the Corporate Finance & Restructuring segment increased $38.8 million, or 21.4%, to $219.8 million in the quarter, compared to $181.1 million in the prior year quarter. Acquisition-related revenues contributed $19.0 million in the quarter. Excluding acquisition-related revenues, revenues increased $19.8 million, or 10.9%, primarily due to higher demand for restructuring services, largely in North America and Europe, the Middle East and Africa, and an increase in success fees, which was partially offset by a $7.6 million decline in pass-through revenues compared to the prior year quarter. Adjusted Segment EBITDA of $35.4 million, or 16.1% of segment revenues, compared to $24.8 million, or 13.7% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was due to higher revenues, which was partially offset by higher compensation, primarily related to a 38.6% increase in billable headcount and higher variable compensation compared to the prior year quarter.

Forensic and Litigation Consulting
Revenues in the Forensic and Litigation Consulting segment decreased $23.1 million, or 15.4%, to $127.2 million in the quarter, compared to $150.3 million in the prior year quarter. The decrease in revenues was primarily due to lower demand for disputes and investigations services. Adjusted Segment EBITDA of $7.6 million, or 6.0% of segment revenues, compared to $17.4 million, or 11.6% of segment revenues, in the prior year quarter. The decrease in Adjusted Segment EBITDA was primarily due to lower revenues with lower utilization, which was partially offset by a decline in SG&A expenses compared to the prior year quarter.

Economic Consulting
Revenues in the Economic Consulting segment increased $7.4 million, or 4.9%, to $160.5 million in the quarter, compared to $153.1 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $5.1 million, or 3.4%, compared to the prior year quarter. The increase in revenues was primarily due to higher demand and realized bill rates for merger and acquisition ("M&A")-related and non-M&A-related antitrust services, which was partially offset by lower demand for financial economics services. Adjusted Segment EBITDA of $31.3 million, or 19.5% of segment revenues, compared to $17.3 million, or 11.3% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was due to higher revenues and a decline in SG&A expenses.

Technology
Revenues in the Technology segment increased $7.1 million, or 13.8%, to $58.6 million in the quarter, compared to $51.5 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues increased $6.5 million, or 12.6%, compared to the prior year quarter. The increase in revenues was primarily due to higher demand for M&A-related "second request" and litigation services. Adjusted Segment EBITDA of $10.2 million, or 17.3% of segment revenues, compared to $7.8 million, or 15.1% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was due to higher revenues, which was partially offset by an increase in compensation.

Strategic Communications
Revenues in the Strategic Communications segment decreased $5.8 million, or 8.8%, to $60.5 million in the quarter, compared to $66.3 million in the prior year quarter. Excluding the estimated positive impact from FX, revenues decreased $7.2 million, or 10.8%, compared to the prior year quarter. The decrease in revenues was primarily due to a $4.8 million decline in pass-through revenues. Adjusted Segment EBITDA of $11.7 million, or 19.4% of segment revenues, compared to $9.9 million, or 14.9% of segment revenues, in the prior year quarter. The increase in Adjusted Segment EBITDA was primarily due to lower SG&A expenses compared to the prior year quarter.

2021 Guidance
The Company estimates that revenues for full year 2021 will range between $2.575 billion and $2.700 billion. The Company estimates that full year 2021 EPS will range between $5.60 and $6.30 and that full year 2021 Adjusted EPS will range between $5.80 and $6.50. The variance between EPS and Adjusted EPS guidance for full year 2021 includes the estimated non-cash interest expense of $0.20 per share related to the Company's 2023 Convertible Notes.

About FTI Consulting
FTI Consulting, Inc. is a global business advisory firm dedicated to helping organizations manage change, mitigate risk and resolve disputes: financial, legal, operational, political & regulatory, reputational and transactional. With more than 6,300 employees located in 28 countries, FTI Consulting professionals work closely with clients to anticipate, illuminate and overcome complex business challenges and make the most of opportunities. The Company generated $2.46 billion in revenues during fiscal year 2020. More information can be found at www.fticonsulting.com.