附录99.1
| 资讯 | 媒体联系 | |||||||
| Allie Bovis | ||||||||
| 立即发布 | abovis@hcg.com | |||||||
| 投资者联系 | ||||||||
| 约翰·D·凯利 | ||||||||
| investor@hcg.com | ||||||||
赫龙宣布2024年第三季度财务业绩，并调高2024年收益预测。
2024年第三季要点
•收入在扣除可退还费用之前(1) 在2024年第三季，收入增加了1190万美元，占3.3％，从2023年第三季的35820万美元增至37000万美元。
•净利润在2024年第三季增加了560万美元，或26.2％，至2710万美元，较2023年第三季的2150万美元增加。
•调整后的税前利润减除折旧及摊销后的费用(9)，一项非通用会计原则衡量指标，于2024年第三季增加690万美元，或14.3%，从2013年第三季的4800万美元增至5490万美元。
•每股稀释盈利增加0.37美元，或33.6%，至2024年第3季的1.47美元，相较于2023年第3季的1.10美元。
•调整后稀释每股收益(9)非通用会计原则下的指标上升了0.29美元，或20.9%，从2023年第3季的1.39美元增至2024年第3季的1.68美元。
•在2024年第三季度，来自营运活动的净现金为8520万美元，相比之下，为6880万美元。 在2023年第三季度。
在2024年截至今日的亮点
•收入在扣除可退还费用之前(1) 2024年前九个月收入较去年同期10.2亿美元增加了7480万美元，增长了7.3％，达到了11亿美元。
•净利润在2024年首九个月增加了2300万美元，或38.5%，至8260万美元，较前一年同期的5960万美元增加。2024年首九个月的结果包括一笔1110万美元的诉讼和解获利（税后净额），该诉讼与Huron是原告有关并已完成。
•调整后的税前利润减除折旧及摊销后的费用(9)非GAAP指标增加了1840万美元，或14.6％，从2024年首个9个月的12600万美元增至1.44亿美元，而上一年同期为1.26亿美元。
•2024年前九个月的每股稀释盈利增加了1.38美元，或45.2%，至4.43美元，相较于去年同期的3.05美元。 2024年前九个月的结果包括诉讼和解收益，该诉讼与完成的法律事项有关，赫隆是原告，对该期稀释每股盈利有0.59美元的有利影响。
•调整后稀释每股收益(9)非通用会计原则指标增加了$0.93，或25.5%，从2024年前九个月的$3.64增至$4.57，与前一年同期相比。
(1) 2024年第三季，公司修订了收入项目描述，将收入更名为在可退还费用前的收入，将总收入和可退还费用更名为总收入。对于任何期间，项目描述的变更并未对项目总计产生影响。
•Huron在2024年的前九个月通过回购公司的1.1百万股普通股向股东返还了1.04亿美元，占截至2023年12月31日公司现有普通股总额的5.8%。
•Huron将预期收入范围缩窄至14.7亿至14.9亿美元，同时保持先前指引的中点；并增加调整后每股稀释盈利(9) 期望调整为6.00至6.20美元的范围。
芝加哥 - 2024年10月29日 全球专业服务公司Huron（纳斯达克代码：HURN）今天宣布了截至2024年9月30日的财务业绩。
“2024年第三季度营业收入增长3％，在去年同期三个营运部门中实现了强劲的增长。我们的医疗和教育板块自2021年第一季度以来每个季度都有所增长，在2024年第三季度，我们的商业板块实现了较2024年第二季度强劲的连续增长，”Mark Hussey说 Mark Hussey，首席执行官兼总裁 赫伦。“我们持续执行提升利润率的计划，营造出强劲的第三季度和年度利润率百分比和每股收益扩张。”
在第三季度所有板块均实现了强劲的销售转化，这使我们有望达到年度营业收入和盈利指引，同时为2025年持续稳健增长打下基础,补充道 Hussey.
2024年第三季度业绩结果
在2024年第三季度，教育咨询和管理服务以及数字能力的需求增加，加上医疗数位能力的需求持续强劲，推动教育服务的未报销费用前收入增加了1190万美元，或3.3%，达到37000万美元，相较于2023年第三季度的35820万美元。这些需求增加部分受商业咨询和管理服务能力需求减少的影响所抵销。这反映了该公司在加快医疗和教育行业增长方面的关注。
净利润增加了560万美元，占2024年第三季度总收入的26.2%，达到2710万美元，较去年同期的2150万美元，占总收入的5.9%有所增加。2024年第三季度，稀释每股收益增加了0.37美元，增幅为33.6%，达到1.47美元，较2023年第三季度的1.10美元有所增加。
2024年第三季息税折旧及摊销前利润（“EBITDA”）(9) 相比前年同期的4260万美元，2024年第三季净利润增加830万美元，增幅为19.4％，达到5090万美元。
除了使用EBITDA评估公司的财务表现外，管理层还使用其他不符合总部财务措施，该措施排除以下项目的影响（单位：千）。
| 结束于三个月的期间 九月三十日， | |||||||||||
| 2024 | 2023 | ||||||||||
| 营业无形资产摊销 | $ | 1,600 | $ | 1,997 | |||||||
| 重组费用 | $ | 3,137 | $ | 5,402 | |||||||
其他收益，净
| $ | (173) | $ | (14) | |||||||
| 与交易相关的费用 | $ | 716 | $ | 302 | |||||||
| 调整的税项影响 | $ | (1,372) | $ | (2,037) | |||||||
| 外币交易损失（收益），净额 | $ | 267 | $ | (332) | |||||||
调整后的税前利润减除折旧及摊销后的费用(9) 净利润增加690万美元，或14.3%，达到5490万美元，占可退还费用前收入的14.8%。(9)在2024年第三季度，相对于可退还费用前收入中的4800万美元，或占13.4%，增加了。(9)和去年同期相比，经调整后的净利润增加390万美元，或14.3%，达到3110万美元。(9) 增加了390万美元，或14.3%，达到3110万美元。
截至2024年第三季，每股稀释盈利为1.68美元，相较于2023年同季的每股稀释盈利为2720万美元，或每股1.39美元。
产生收入的专业人员数量(2) 截至二零二四年九月三十日截至二零二零年九月三十日的 5,341 宗，上升 10.4% 至 5,896。利用率(8) 在 2024 年第三季，该公司的咨询能力为 73.6%，而去年同期的 77.3%。利用率(8) 对于该公司的数字能力在 2024 年第三季度增加到 77.2%，而去年同期的 75.4% 相比。
2024年至今业绩结果
2024年前九个月之前可退费用支出前的营收增加了7.3%，为$11亿，相较于2023年前九个月的$10.2亿。在可退费用支出前的营收增长受到持续需求强劲的推动，包括我们在医疗保健和教育中的咨询与经营服务能力和数位能力，反映公司专注于加快医疗保健和教育行业增长。这些增长部分被商业数位和咨询及经营服务能力的需求下降部分抵销。
Net income increased $23.0 million, or 38.5%, to $82.6 million, or 7.4% of total revenues, for the first nine months of 2024, compared to $59.6 million, or 5.7% of total revenues, for the same prior year period. Results for the first nine months of 2024 include an $11.1 million litigation settlement gain, net of tax, related to a completed legal matter in which Huron was the plaintiff. Diluted earnings per share increased $1.38, or 45.2%, to $4.43 for the first nine months of 2024, compared to $3.05 for the same prior year period. The litigation settlement gain recognized in the second quarter of 2024 had a favorable $0.59 impact on diluted earnings per share for the nine months ended September 30, 2024.
EBITDA(9) for the first nine months of 2024 increased $29.6 million, or 25.5%, to $146.1 million, compared to $116.5 million in the same prior year period. Results for the first nine months of 2024 include a pre-tax $15.0 million litigation settlement gain related to the completed legal matter in which Huron was the plaintiff.
In addition to using EBITDA to evaluate the company’s financial performance, management uses other non-GAAP financial measures, which exclude the effect of the following items (in thousands):
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Amortization of intangible assets | $ | 4,917 | $ | 6,202 | |||||||
| Restructuring charges | $ | 7,530 | $ | 9,385 | |||||||
2024 litigation settlement gain (10) | $ | (11,701) | $ | — | |||||||
Other losses (gains), net | $ | 478 | $ | (202) | |||||||
| Transaction-related expenses | $ | 2,316 | $ | 302 | |||||||
| Tax effect of adjustments | $ | (920) | $ | (4,157) | |||||||
| Foreign currency transaction losses (gains), net | $ | (348) | $ | 36 | |||||||
Adjusted EBITDA(9), which excludes the 2024 litigation settlement gain, increased $18.4 million, or 14.6%, to $144.4 million, or 13.2% of revenues before reimbursable expenses(9), for the first nine months of 2024, compared to $126.0 million, or 12.3% of revenues before reimbursable expenses(9), in the same prior year period. Adjusted net income(9) increased $14.1 million, or 19.8%, to $85.3 million, or $4.57 per diluted share, for the first nine months of 2024, compared to $71.2 million, or $3.64 per diluted share, for the same prior year period.
The number of revenue-generating professionals(2) increased 10.4% to 5,896 as of September 30, 2024 from 5,341 as of September 30, 2023. The utilization rate(8) of the company's Consulting capability was 72.5% for the first nine months of 2024, compared to 76.5% during the same period last year. The utilization rate(8) for the company's Digital capability increased to 75.4% for the first nine months of 2024, compared to 73.7% during the same period last year.
Additionally, Huron returned $104.0 million to shareholders in the first nine months of 2024 by repurchasing 1,067,545 shares of the company's common stock, representing 5.8% of the company's common stock outstanding as of December 31, 2023.
OPERATING INDUSTRIES
The company’s year-to-date 2024 revenues before reimbursable expenses by operating segment as a percentage of total company revenues before reimbursable expenses are as follows: Healthcare (50%); Education (32%); and Commercial (18%). Financial results by operating industry are included in the attached schedules and in Huron's forthcoming Quarterly Report on Form 10-Q filing for the quarter ended September 30, 2024.
OUTLOOK FOR 2024
Based on currently available information, the company is narrowing guidance for full year 2024 revenues before reimbursable expenses to a range of $1.47 billion to $1.49 billion while maintaining its previous midpoint of guidance. The company also anticipates adjusted EBITDA as a percentage of revenues before reimbursable expenses(9) in a range of 13.0% to 13.5%, and is increasing adjusted diluted earnings per share(9) guidance to a range of $6.00 to $6.20.
THIRD QUARTER 2024 WEBCAST
The company will host a webcast to discuss its financial results today, October 29, 2024, at 5:00 p.m. Eastern Time, 4:00 p.m. Central Time. The conference call is being webcast by Notified and can be accessed from Huron's website at http://ir.huronconsultinggroup.com. A replay will be available approximately two hours after the conclusion of the webcast and for 90 days thereafter.
USE OF NON-GAAP FINANCIAL MEASURES(9)
In evaluating the company’s financial performance and outlook, management uses EBITDA, adjusted EBITDA, adjusted EBITDA as a percentage of revenues before reimbursable expenses, adjusted net income, and adjusted diluted earnings per share, which are non-GAAP measures. Management uses these non-GAAP financial measures to gain an understanding of the company's comparative operating performance (when comparing such results with previous periods or forecasts). These non-GAAP financial measures are used by management in their financial and operating decision making because management believes they reflect the company's ongoing business in a manner that allows for meaningful period-to-period comparisons. Management also uses these non-GAAP financial measures when publicly providing their business outlook, for internal management purposes, and as a basis for evaluating potential acquisitions and dispositions. Management believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Huron’s current operating performance and future prospects in the same manner as management does, if they so choose, and in comparing in a consistent manner Huron’s current financial results with Huron’s past financial results. Investors should recognize that these non-GAAP measures might not be comparable to similarly titled measures of other companies. These measures should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flows or liquidity prepared in accordance with accounting principles generally accepted in the United States.
Management has provided its outlook regarding adjusted EBITDA and adjusted diluted earnings per share, both of which are non-GAAP financial measures and exclude certain charges. Management has not reconciled these non-GAAP financial measures to the corresponding GAAP financial measures because guidance for the various reconciling items is not provided. Management is unable to provide guidance for these reconciling items because they cannot determine their probable significance, as certain items are outside of the company's control and cannot be reasonably predicted since these items could vary significantly from period to period. Accordingly, reconciliations to the corresponding GAAP financial measures are not available without unreasonable effort.
ABOUT HURON
Huron is a global professional services firm that collaborates with clients to put possible into practice by creating sound strategies, optimizing operations, accelerating digital transformation, and empowering businesses and their people to own their future. By embracing diverse perspectives, encouraging new ideas and challenging the status quo, we create sustainable results for the organizations we serve. Learn more at www.huronconsultinggroup.com.
Statements in this press release that are not historical in nature, including those concerning the company’s current expectations about its future results, are “forward-looking” statements as defined in Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified by words such as “may,” “should,” “expects,” “provides,” “anticipates,” “assumes,” “can,” “will,” “meets,” “could,” “likely,” “intends,” “might,” “predicts,” “seeks,” “would,” “believes,” “estimates,” “plans,” “continues,” “goals,” “guidance,” or “outlook” or similar expressions. These forward-looking statements reflect the company's current expectations about future requirements and needs, results, levels of activity, performance, or achievements. Some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: failure to achieve expected utilization rates, billing rates, and the necessary number of revenue-generating professionals; inability to expand or adjust our service offerings in response to market demands; our dependence on renewal of client-based services; dependence on new business and retention of current clients and qualified personnel; failure to maintain third-party provider relationships and strategic alliances; inability to license technology to and from third parties; the impairment of goodwill; various factors related to income and other taxes; difficulties in successfully integrating the businesses we acquire and achieving expected benefits from such acquisitions; risks relating to privacy, information security, and related laws and standards; and a general downturn in market conditions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors, including, among others, those described under “Item 1A. Risk Factors” in Huron's Annual Report on Form 10-K for the year ended December 31, 2023 that may cause actual results, levels of activity, performance or achievements to be materially different from any anticipated results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. The company disclaims any obligation to update or revise any forward-looking statements as a result of new information or future events, or for any other reason.
HURON CONSULTING GROUP INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Revenues before reimbursable expenses | $ | 370,049 | $ | 358,178 | $ | 1,097,664 | $ | 1,022,832 | |||||||||||||||
| Reimbursable expenses | 8,040 | 9,288 | 24,827 | 25,918 | |||||||||||||||||||
| Total revenues | 378,089 | 367,466 | 1,122,491 | 1,048,750 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Direct costs (exclusive of depreciation and amortization included below) | 247,849 | 244,774 | 749,757 | 708,355 | |||||||||||||||||||
| Reimbursable expenses | 8,135 | 9,497 | 25,146 | 26,242 | |||||||||||||||||||
| Selling, general and administrative expenses | 70,375 | 64,361 | 214,485 | 190,857 | |||||||||||||||||||
| Other gains, net | (173) | (14) | (14,522) | (202) | |||||||||||||||||||
| Restructuring charges | 3,137 | 5,402 | 7,530 | 9,385 | |||||||||||||||||||
| Depreciation and amortization | 6,321 | 6,104 | 18,326 | 18,621 | |||||||||||||||||||
| Total operating expenses | 335,644 | 330,124 | 1,000,722 | 953,258 | |||||||||||||||||||
| Operating income | 42,445 | 37,342 | 121,769 | 95,492 | |||||||||||||||||||
| Other income (expense), net: | |||||||||||||||||||||||
| Interest expense, net of interest income | (6,800) | (5,047) | (19,894) | (15,146) | |||||||||||||||||||
| Other income (expense), net | 1,936 | (1,000) | 5,361 | 1,781 | |||||||||||||||||||
| Total other expense, net | (4,864) | (6,047) | (14,533) | (13,365) | |||||||||||||||||||
| Income before taxes | 37,581 | 31,295 | 107,236 | 82,127 | |||||||||||||||||||
| Income tax expense | 10,432 | 9,779 | 24,599 | 22,480 | |||||||||||||||||||
| Net income | $ | 27,149 | $ | 21,516 | $ | 82,637 | $ | 59,647 | |||||||||||||||
| Earnings per share: | |||||||||||||||||||||||
| Net income per basic share | $ | 1.53 | $ | 1.15 | $ | 4.61 | $ | 3.15 | |||||||||||||||
| Net income per diluted share | $ | 1.47 | $ | 1.10 | $ | 4.43 | $ | 3.05 | |||||||||||||||
| Weighted average shares used in calculating earnings per share: | |||||||||||||||||||||||
| Basic | 17,754 | 18,770 | 17,945 | 18,941 | |||||||||||||||||||
| Diluted | 18,471 | 19,475 | 18,672 | 19,578 | |||||||||||||||||||
| Comprehensive income (loss): | |||||||||||||||||||||||
| Net income | $ | 27,149 | $ | 21,516 | $ | 82,637 | $ | 59,647 | |||||||||||||||
| Foreign currency translation adjustments, net of tax | 900 | (662) | (103) | (283) | |||||||||||||||||||
| Unrealized gain (loss) on investment, net of tax | (443) | (1,350) | (8,208) | 3,076 | |||||||||||||||||||
| Unrealized loss on cash flow hedging instruments, net of tax | (4,716) | (368) | (4,770) | (234) | |||||||||||||||||||
| Other comprehensive income (loss) | (4,259) | (2,380) | (13,081) | 2,559 | |||||||||||||||||||
| Comprehensive income | $ | 22,890 | $ | 19,136 | $ | 69,556 | $ | 62,206 | |||||||||||||||
HURON CONSULTING GROUP INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
(Unaudited)
| September 30, 2024 | December 31, 2023 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 18,497 | $ | 12,149 | |||||||
| Receivables from clients, net | 204,894 | 162,566 | |||||||||
| Unbilled services, net | 177,437 | 190,869 | |||||||||
| Income tax receivable | 9,192 | 6,385 | |||||||||
| Prepaid expenses and other current assets | 27,789 | 28,491 | |||||||||
| Total current assets | 437,809 | 400,460 | |||||||||
| Property and equipment, net | 21,682 | 23,728 | |||||||||
| Deferred income taxes, net | 2,408 | 2,288 | |||||||||
| Long-term investments | 64,319 | 75,414 | |||||||||
| Operating lease right-of-use assets | 21,026 | 24,131 | |||||||||
| Other non-current assets | 111,448 | 92,336 | |||||||||
| Intangible assets, net | 22,547 | 18,074 | |||||||||
| Goodwill | 647,541 | 625,711 | |||||||||
| Total assets | $ | 1,328,780 | $ | 1,262,142 | |||||||
| Liabilities and stockholders’ equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 8,151 | $ | 10,074 | |||||||
| Accrued expenses and other current liabilities | 26,490 | 33,087 | |||||||||
| Accrued payroll and related benefits | 183,182 | 225,921 | |||||||||
| Current maturities of long-term debt | 13,750 | — | |||||||||
| Current maturities of operating lease liabilities | 11,990 | 11,032 | |||||||||
| Deferred revenues | 27,703 | 22,461 | |||||||||
| Total current liabilities | 271,266 | 302,575 | |||||||||
| Non-current liabilities: | |||||||||||
| Deferred compensation and other liabilities | 44,322 | 35,665 | |||||||||
| Long-term debt, net of current portion | 428,204 | 324,000 | |||||||||
| Operating lease liabilities, net of current portion | 33,442 | 38,850 | |||||||||
| Deferred income taxes, net | 28,774 | 28,160 | |||||||||
| Total non-current liabilities | 534,742 | 426,675 | |||||||||
| Commitments and contingencies | |||||||||||
| Stockholders’ equity | |||||||||||
Common stock; $0.01 par value; 500,000,000 shares authorized; 20,793,202 and 21,316,441 shares issued, respectively | 207 | 212 | |||||||||
Treasury stock, at cost, 3,062,689 and 2,852,296 shares, respectively | (159,717) | (142,136) | |||||||||
| Additional paid-in capital | 174,872 | 236,962 | |||||||||
| Retained earnings | 497,664 | 415,027 | |||||||||
| Accumulated other comprehensive income | 9,746 | 22,827 | |||||||||
| Total stockholders’ equity | 522,772 | 532,892 | |||||||||
| Total liabilities and stockholders’ equity | $ | 1,328,780 | $ | 1,262,142 | |||||||
HURON CONSULTING GROUP INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 82,637 | $ | 59,647 | |||||||
| Adjustments to reconcile net income to cash flows from operating activities: | |||||||||||
| Depreciation and amortization | 18,326 | 18,653 | |||||||||
| Non-cash lease expense | 4,486 | 4,840 | |||||||||
| Lease-related impairment charges | 3,513 | 5,584 | |||||||||
| Share-based compensation | 33,963 | 35,398 | |||||||||
| Amortization of debt discount and issuance costs | 793 | 577 | |||||||||
| Allowances for doubtful accounts | 3,062 | 53 | |||||||||
| Deferred income taxes | 5,037 | 890 | |||||||||
| Gain on sale of property and equipment | (101) | (61) | |||||||||
| Change in fair value of contingent consideration liabilities | (589) | (251) | |||||||||
| Changes in operating assets and liabilities, net of acquisitions and divestiture: | |||||||||||
| (Increase) decrease in receivables from clients, net | (44,739) | (18,508) | |||||||||
| (Increase) decrease in unbilled services, net | 13,770 | (51,092) | |||||||||
| (Increase) decrease in current income tax receivable / payable, net | (3,114) | (4,365) | |||||||||
| (Increase) decrease in other assets | (8,412) | (6,243) | |||||||||
| Increase (decrease) in accounts payable and other liabilities | (6,994) | (5,361) | |||||||||
| Increase (decrease) in accrued payroll and related benefits | (41,385) | 10,805 | |||||||||
| Increase (decrease) in deferred revenues | 1,451 | 4,328 | |||||||||
| Net cash provided by operating activities | 61,704 | 54,894 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of property and equipment | (6,028) | (5,147) | |||||||||
| Investments in life insurance policies | (2,166) | (2,601) | |||||||||
| Distributions from life insurance policies | — | 2,956 | |||||||||
| Purchases of businesses | (20,769) | (1,613) | |||||||||
| Capitalization of internally developed software costs | (19,341) | (19,610) | |||||||||
| Proceeds from note receivable | 154 | 154 | |||||||||
| Proceeds from sale of property and equipment | 102 | 62 | |||||||||
| Net cash used in investing activities | (48,048) | (25,799) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from exercises of stock options | 1,634 | 987 | |||||||||
| Shares redeemed for employee tax withholdings | (21,458) | (10,050) | |||||||||
| Share repurchases | (104,553) | (88,897) | |||||||||
| Proceeds from bank borrowings | 682,500 | 292,000 | |||||||||
| Repayments of bank borrowings | (563,375) | (224,000) | |||||||||
| Payments for debt issuance costs | (1,446) | (58) | |||||||||
| Deferred payments on business acquisition | (617) | (1,500) | |||||||||
| Net cash used in financing activities | (7,315) | (31,518) | |||||||||
| Effect of exchange rate changes on cash | 7 | (13) | |||||||||
| Net increase (decrease) in cash and cash equivalents | 6,348 | (2,436) | |||||||||
| Cash and cash equivalents at beginning of the period | 12,149 | 11,834 | |||||||||
| Cash and cash equivalents at end of the period | $ | 18,497 | $ | 9,398 | |||||||
HURON CONSULTING GROUP INC.
SEGMENT OPERATING RESULTS AND OTHER OPERATING DATA
(Unaudited)
| Three Months Ended September 30, | Percent Increase (Decrease) | Nine Months Ended September 30, | Percent Increase (Decrease) | |||||||||||||||||||||||||||||||||||
| Segment and Consolidated Operating Results (in thousands): | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||
| Healthcare: | ||||||||||||||||||||||||||||||||||||||
| Revenues before reimbursable expenses | $ | 183,136 | $ | 179,177 | 2.2% | $ | 553,976 | $ | 501,994 | 10.4% | ||||||||||||||||||||||||||||
| Operating income | $ | 49,651 | $ | 46,888 | 5.9% | $ | 147,591 | $ | 128,294 | 15.0% | ||||||||||||||||||||||||||||
| Segment operating margin | 27.1 | % | 26.2 | % | 26.6 | % | 25.6 | % | ||||||||||||||||||||||||||||||
| Education: | ||||||||||||||||||||||||||||||||||||||
| Revenues before reimbursable expenses | $ | 121,048 | $ | 111,043 | 9.0% | $ | 355,384 | $ | 325,884 | 9.1% | ||||||||||||||||||||||||||||
| Operating income | $ | 29,158 | $ | 26,550 | 9.8% | $ | 81,906 | $ | 77,112 | 6.2% | ||||||||||||||||||||||||||||
| Segment operating margin | 24.1 | % | 23.9 | % | 23.0 | % | 23.7 | % | ||||||||||||||||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||||||||||||||
| Revenues before reimbursable expenses | $ | 65,865 | $ | 67,958 | (3.1)% | $ | 188,304 | $ | 194,954 | (3.4)% | ||||||||||||||||||||||||||||
| Operating income | $ | 16,144 | $ | 15,432 | 4.6% | $ | 39,198 | $ | 39,971 | (1.9)% | ||||||||||||||||||||||||||||
| Segment operating margin | 24.5 | % | 22.7 | % | 20.8 | % | 20.5 | % | ||||||||||||||||||||||||||||||
| Total Huron: | ||||||||||||||||||||||||||||||||||||||
| Revenues before reimbursable expenses | $ | 370,049 | $ | 358,178 | 3.3% | $ | 1,097,664 | $ | 1,022,832 | 7.3% | ||||||||||||||||||||||||||||
| Reimbursable expenses | 8,040 | 9,288 | (13.4)% | 24,827 | 25,918 | (4.2)% | ||||||||||||||||||||||||||||||||
| Total revenues | $ | 378,089 | $ | 367,466 | 2.9% | $ | 1,122,491 | $ | 1,048,750 | 7.0% | ||||||||||||||||||||||||||||
| Items not allocated at the segment level: | ||||||||||||||||||||||||||||||||||||||
| Unallocated corporate expenses | 46,821 | 43,100 | 8.6% | 143,386 | 129,765 | 10.5% | ||||||||||||||||||||||||||||||||
| Other gains, net | (173) | (14) | N/M | (14,522) | (202) | N/M | ||||||||||||||||||||||||||||||||
Restructuring charges | 1,921 | 4,095 | (53.1)% | 6,201 | 6,881 | (9.9)% | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 3,939 | 4,347 | (9.4)% | 11,861 | 13,441 | (11.8)% | ||||||||||||||||||||||||||||||||
| Operating income | 42,445 | 37,342 | 13.7% | 121,769 | 95,492 | 27.5% | ||||||||||||||||||||||||||||||||
| Other expense, net | (4,864) | (6,047) | (19.6)% | (14,533) | (13,365) | 8.7% | ||||||||||||||||||||||||||||||||
| Income before taxes | $ | 37,581 | $ | 31,295 | 20.1% | $ | 107,236 | $ | 82,127 | 30.6% | ||||||||||||||||||||||||||||
| Other Operating Data: | ||||||||||||||||||||||||||||||||||||||
Number of revenue-generating professionals by segment (at period end) (2)(3): | ||||||||||||||||||||||||||||||||||||||
| Healthcare | 2,442 | 1,878 | 30.0% | 2,442 | 1,878 | 30.0% | ||||||||||||||||||||||||||||||||
| Education | 1,250 | 1,203 | 3.9% | 1,250 | 1,203 | 3.9% | ||||||||||||||||||||||||||||||||
Commercial (4) | 2,204 | 2,260 | (2.5)% | 2,204 | 2,260 | (2.5)% | ||||||||||||||||||||||||||||||||
| Total | 5,896 | 5,341 | 10.4% | 5,896 | 5,341 | 10.4% | ||||||||||||||||||||||||||||||||
| Revenues before reimbursable expenses by capability: | ||||||||||||||||||||||||||||||||||||||
Consulting and Managed Services (5)(6) | $ | 214,517 | $ | 214,688 | (0.1)% | $ | 634,415 | $ | 589,137 | 7.7% | ||||||||||||||||||||||||||||
| Digital | 155,532 | 143,490 | 8.4% | 463,249 | 433,695 | 6.8% | ||||||||||||||||||||||||||||||||
| Total | $ | 370,049 | $ | 358,178 | 3.3% | $ | 1,097,664 | $ | 1,022,832 | 7.3% | ||||||||||||||||||||||||||||
Number of revenue-generating professionals by capability (at period end)(2): | ||||||||||||||||||||||||||||||||||||||
Consulting and Managed Services (5)(7) | 3,052 | 2,483 | 22.9% | 3,052 | 2,483 | 22.9% | ||||||||||||||||||||||||||||||||
| Digital | 2,844 | 2,858 | (0.5)% | 2,844 | 2,858 | (0.5)% | ||||||||||||||||||||||||||||||||
| Total | 5,896 | 5,341 | 10.4% | 5,896 | 5,341 | 10.4% | ||||||||||||||||||||||||||||||||
Utilization rate by capability (8): | ||||||||||||||||||||||||||||||||||||||
| Consulting | 73.6 | % | 77.3 | % | 72.5 | % | 76.5 | % | ||||||||||||||||||||||||||||||
| Digital | 77.2 | % | 75.4 | % | 75.4 | % | 73.7 | % | ||||||||||||||||||||||||||||||
(2) Consists of our full-time consultants who generate revenues based on the number of hours worked; full-time equivalents, which consists of coaches and their support staff within the culture and organizational excellence solution, consultants who work variable schedules as needed by clients, and full-time employees who provide software support and maintenance services to clients; and our Healthcare managed services employees who provide revenue cycle billing, collections, insurance verification and change integrity services to clients.
(3) During the first quarter of 2024, we reclassified certain revenue-generating professionals within our Digital capability from our Healthcare and Education segments to our Commercial segment as these professionals are able to provide services across all of our industries. This reclassification did not impact the total Digital capability headcount for any period. The prior period headcount has been revised for consistent presentation.
(4) The majority of our revenue-generating professionals within our Commercial segment can provide services across all of our industries, including healthcare and education, and the related costs of these professionals are allocated to each of the segments.
(5) During the first quarter of 2024, we reclassified one of the offerings within Education's Consulting capability to Education's Managed Services capability. Revenues before reimbursable expenses generated by this offering during the quarters ended March 31, 2023, June 30, 2023, September 30, 2023, and December 31, 2023 were $2.8 million, $2.2 million, $2.4 million, and $2.7 million, respectively, and during the years ended December 31, 2022 and 2023 were $15.0 million and $10.1 million, respectively. The number of revenue-generating professionals within this offering as of December 31, 2022, March 31, 2023, June 30, 2023, September 30, 2023 and December 31, 2023 were 54, 24, 24, 24 and 23, respectively.
This reclassification did not impact the aggregate revenues before reimbursable expenses or headcount reported for the Education Consulting and Managed Services capability for any period, and the prior period Education Managed Services capability revenues before reimbursable expenses and headcount in the following footnotes have been revised for consistent presentation.
(6) Managed Services capability revenues before reimbursable expenses within our Healthcare segment was $19.3 million and $16.7 million for the three months ended September 30, 2024 and 2023, respectively; and $53.5 million and $53.8 million for the nine months ended September 30, 2024 and 2023, respectively.
Managed Services capability revenues before reimbursable expenses within our Education segment was $6.6 million and $7.4 million for the three months ended September 30, 2024 and 2023, respectively; and $20.8 million and $22.0 million for the nine months ended September 30, 2024 and 2023, respectively.
(7) The number of Managed Services revenue-generating professionals within our Healthcare segment was 1,223 and 757 as of September 30, 2024 and 2023, respectively.
The number of Managed Services revenue-generating professionals within our Education segment was 122 and 129 as of September 30, 2024 and 2023, respectively.
(8) Utilization rate is calculated by dividing the number of hours our billable consultants worked on client assignments during a period by the total available working hours for these billable consultants during the same period. Available working hours are determined by the standard hours worked by each billable consultant, adjusted for part-time hours, and U.S. standard work weeks. Available working hours exclude local country holidays and vacation days. Utilization rates are presented for our revenue-generating professionals who primarily bill on an hourly basis. We have not presented utilization rates for our Managed Services professionals as most of the revenues generated by these employees are not billed on an hourly basis.
HURON CONSULTING GROUP INC.
RECONCILIATION OF NET INCOME
TO ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (9)
(In thousands)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Revenues before reimbursable expenses | $ | 370,049 | $ | 358,178 | $ | 1,097,664 | $ | 1,022,832 | |||||||||||||||
| Reimbursable expenses | 8,040 | 9,288 | 24,827 | 25,918 | |||||||||||||||||||
| Total revenues | $ | 378,089 | $ | 367,466 | $ | 1,122,491 | $ | 1,048,750 | |||||||||||||||
| Net income | $ | 27,149 | $ | 21,516 | $ | 82,637 | $ | 59,647 | |||||||||||||||
| Net income as a percentage of total revenues | 7.2 | % | 5.9 | % | 7.4 | % | 5.7 | % | |||||||||||||||
| Add back: | |||||||||||||||||||||||
Income tax expense | 10,432 | 9,779 | 24,599 | 22,480 | |||||||||||||||||||
| Interest expense, net of interest income | 6,800 | 5,047 | 19,894 | 15,146 | |||||||||||||||||||
| Depreciation and amortization | 6,542 | 6,300 | 18,967 | 19,183 | |||||||||||||||||||
Earnings before interest, taxes, depreciation and amortization (EBITDA) (9) | 50,923 | 42,642 | 146,097 | 116,456 | |||||||||||||||||||
| Add back: | |||||||||||||||||||||||
| Restructuring charges | 3,137 | 5,402 | 7,530 | 9,385 | |||||||||||||||||||
2024 litigation settlement gain (10) | — | — | (11,701) | — | |||||||||||||||||||
Other losses (gains), net | (173) | (14) | 478 | (202) | |||||||||||||||||||
| Transaction-related expenses | 716 | 302 | 2,316 | 302 | |||||||||||||||||||
| Foreign currency transaction losses (gains), net | 267 | (332) | (348) | 36 | |||||||||||||||||||
Adjusted EBITDA (9) | $ | 54,870 | $ | 48,000 | $ | 144,372 | $ | 125,977 | |||||||||||||||
Adjusted EBITDA as a percentage of revenues before reimbursable expenses (9) | 14.8 | % | 13.4 | % | 13.2 | % | 12.3 | % | |||||||||||||||
HURON CONSULTING GROUP INC.
RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME (9)
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Net income | $ | 27,149 | $ | 21,516 | $ | 82,637 | $ | 59,647 | |||||||||||||||
| Weighted average shares - diluted | 18,471 | 19,475 | 18,672 | 19,578 | |||||||||||||||||||
| Diluted earnings per share | $ | 1.47 | $ | 1.10 | $ | 4.43 | $ | 3.05 | |||||||||||||||
| Add back: | |||||||||||||||||||||||
| Amortization of intangible assets | 1,600 | 1,997 | 4,917 | 6,202 | |||||||||||||||||||
| Restructuring charges | 3,137 | 5,402 | 7,530 | 9,385 | |||||||||||||||||||
2024 litigation settlement gain (10) | — | — | (11,701) | — | |||||||||||||||||||
Other losses (gains), net | (173) | (14) | 478 | (202) | |||||||||||||||||||
| Transaction-related expenses | 716 | 302 | 2,316 | 302 | |||||||||||||||||||
| Tax effect of adjustments | (1,372) | (2,037) | (920) | (4,157) | |||||||||||||||||||
| Total adjustments, net of tax | 3,908 | 5,650 | 2,620 | 11,530 | |||||||||||||||||||
Adjusted net income (9) | $ | 31,057 | $ | 27,166 | $ | 85,257 | $ | 71,177 | |||||||||||||||
| Adjusted weighted average shares - diluted | 18,471 | 19,475 | 18,672 | 19,578 | |||||||||||||||||||
Adjusted diluted earnings per share (9) | $ | 1.68 | $ | 1.39 | $ | 4.57 | $ | 3.64 | |||||||||||||||
(9) In evaluating the company’s financial performance and outlook, management uses earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA, adjusted EBITDA as a percentage of revenues before reimbursable expenses, adjusted net income, and adjusted diluted earnings per share, which are non-GAAP measures. Management uses these non-GAAP financial measures to gain an understanding of the company's comparative operating performance (when comparing such results with previous periods or forecasts). These non-GAAP financial measures are
used by management in their financial and operating decision making because management believes they reflect the company's ongoing business in a manner that allows for meaningful period-to-period comparisons. Management also uses these non-GAAP financial measures when publicly providing the company's business outlook, for internal management purposes, and as a basis for evaluating potential acquisitions and dispositions. Management believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Huron’s current operating performance and future prospects in the same manner as management does, if they so choose, and in comparing in a consistent manner Huron’s current financial results with Huron’s past financial results. Investors should recognize that these non-GAAP measures might not be comparable to similarly titled measures of other companies. These measures should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flows or liquidity prepared in accordance with accounting principles generally accepted in the United States.
(10) The non-GAAP financial measures for the nine months ended September 30, 2024 include an adjustment for the 2024 litigation settlement gain. In the second quarter of 2024, the company settled a litigation matter in which Huron was the plaintiff for $15.0 million, on a pre-tax basis. This $15.0 million settlement gain was recorded as a component of other gains, net on the consolidated statement of operations. The company has excluded from the non-GAAP measures $11.7 million, which is the value of the settlement gain that exceeds the third-party legal costs incurred during 2024 specific to this litigation matter, as this net gain is not indicative of the ongoing performance of Huron's business. Of the $3.3 million third-party legal costs incurred for this matter in 2024, $2.7 million was incurred in the first quarter and $0.6 million was incurred in the second quarter. Third-party legal expenses are recorded as a component of selling, general and administrative expenses on the statement of operations. Third-party legal costs incurred for this litigation matter during the three and nine months ended September 30, 2023 were $1.2 million and $2.2 million, respectively.