FTI Consulting, Inc. (FCN - Free Report) reported impressive fourth-quarter 2022 results with earnings and revenues beating the Zacks Consensus Estimate.
The better-than-expected results, however, failed to impress the market as the stock didn’t move much since the earnings release on Feb 23. The stock has gained 22.8% in the past year against the 11.2% decline of the industry it belongs to.
Adjusted earnings per share of $1.52 beat the Zacks Consensus Estimate by 14.3% and increased 34.5% on a year-over-year basis. Total revenues of $774.4 million surpassed the consensus mark by 5% and rose 14.5% on a year-over-year basis.
Quarterly Numbers in Detail
Forensic and Litigation Consulting revenues increased 16.2% year over year to $160.4 million. The uptick was primarily driven by higher demand for investigations, data & analytics, and health solutions services.
Strategic Communications revenues increased 3.7% year over year to $72.4 million. The uptick can be attributed to higher demand for public affairs and financial communications services.
Technology revenues increased 18.9% year over year to $76.8 million. The uptick was primarily driven by higher demand for M&A-related "second request" and investigation services.
Economic Consulting revenues declined marginally year over year to $172 million. The decline can be attributed to lower demand for financial economics services, partially offset by higher realization for merger and acquisition-related antitrust, and international arbitration services.
Corporate Finance & Restructuring revenues increased 26.5% year over year to $292.8 million. The uptick was primarily on higher demand for business transformation and restructuring services.
Operating Results
Adjusted EBITDA was $91.9 million, up 48.4% on a year-over-year basis. The adjusted EBITDA margin contracted 270 basis points year over year to 11.9%.
Balance Sheet and Cash Flow
FTI Consulting exited the quarter with cash and cash equivalents of $491.7 million compared with the prior quarter’s $327 million. Long-term debt was $315.2 million compared with $314.8 million witnessed at the end of the previous quarter. FCN generated $60.5 million of net cash from operating activities, while CapEx was $39.8 million.
2023 Guidance
FCN expects revenues between $3.33 billion and $3.47 billion, the mid-point ($3.4 billion) of which is above the Zacks Consensus Estimate of $3.35 billion.
Adjusted EPS is expected between $6.8 and $7.7, the mid-point ($7.25 billion) of which is below the Zacks Consensus Estimate of $7.39.
FTI Consulting currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Recent Performance of Some Other Business Services Companies
Robert Half International Inc. (RHI - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
RHI’s quarterly earnings of $1.37 per share beat the Zacks Consensus Estimate by 1.5% but declined 9.3% year over year. Revenues of $1.73 billion missed the Zacks Consensus Estimate by 0.6% and decreased 2.4% year over year.
Automatic Data Processing, Inc. (ADP - Free Report) reported better-than-expected second-quarter fiscal 2023 results.
ADP’s adjusted earnings per share of $1.96 beat the Zacks Consensus Estimate by 0.5% and grew 19% from the year-ago quarter. Total revenues of $4.4 billion beat the Zacks Consensus Estimate by 0.3% and improved 9.1% from the year-ago quarter.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported impressive third-quarter fiscal 2023 results, wherein both earnings and revenues beat the Zacks Consensus Estimate. Quarterly adjusted earnings per share of $1.07 beat the Zacks Consensus Estimate by 4.9% and increased 4.9% on a year-over-year basis.
BAH’s total revenues of $2.3 billion beat the Zacks Consensus Estimate by 4% and increased 12.1% on a year-over-year basis.
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FTI Consulting, Inc. (FCN - Free Report) reported impressive fourth-quarter 2022 results with earnings and revenues beating the Zacks Consensus Estimate.
The better-than-expected results, however, failed to impress the market as the stock didn’t move much since the earnings release on Feb 23. The stock has gained 22.8% in the past year against the 11.2% decline of the industry it belongs to.
Adjusted earnings per share of $1.52 beat the Zacks Consensus Estimate by 14.3% and increased 34.5% on a year-over-year basis. Total revenues of $774.4 million surpassed the consensus mark by 5% and rose 14.5% on a year-over-year basis.
Quarterly Numbers in Detail
Forensic and Litigation Consulting revenues increased 16.2% year over year to $160.4 million. The uptick was primarily driven by higher demand for investigations, data & analytics, and health solutions services.
Strategic Communications revenues increased 3.7% year over year to $72.4 million. The uptick can be attributed to higher demand for public affairs and financial communications services.
Technology revenues increased 18.9% year over year to $76.8 million. The uptick was primarily driven by higher demand for M&A-related "second request" and investigation services.
Economic Consulting revenues declined marginally year over year to $172 million. The decline can be attributed to lower demand for financial economics services, partially offset by higher realization for merger and acquisition-related antitrust, and international arbitration services.
Corporate Finance & Restructuring revenues increased 26.5% year over year to $292.8 million. The uptick was primarily on higher demand for business transformation and restructuring services.
Operating Results
Adjusted EBITDA was $91.9 million, up 48.4% on a year-over-year basis. The adjusted EBITDA margin contracted 270 basis points year over year to 11.9%.
Balance Sheet and Cash Flow
FTI Consulting exited the quarter with cash and cash equivalents of $491.7 million compared with the prior quarter’s $327 million. Long-term debt was $315.2 million compared with $314.8 million witnessed at the end of the previous quarter. FCN generated $60.5 million of net cash from operating activities, while CapEx was $39.8 million.
2023 Guidance
FCN expects revenues between $3.33 billion and $3.47 billion, the mid-point ($3.4 billion) of which is above the Zacks Consensus Estimate of $3.35 billion.
Adjusted EPS is expected between $6.8 and $7.7, the mid-point ($7.25 billion) of which is below the Zacks Consensus Estimate of $7.39.
FTI Consulting currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Recent Performance of Some Other Business Services Companies
Robert Half International Inc. (RHI - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
RHI’s quarterly earnings of $1.37 per share beat the Zacks Consensus Estimate by 1.5% but declined 9.3% year over year. Revenues of $1.73 billion missed the Zacks Consensus Estimate by 0.6% and decreased 2.4% year over year.
Automatic Data Processing, Inc. (ADP - Free Report) reported better-than-expected second-quarter fiscal 2023 results.
ADP’s adjusted earnings per share of $1.96 beat the Zacks Consensus Estimate by 0.5% and grew 19% from the year-ago quarter. Total revenues of $4.4 billion beat the Zacks Consensus Estimate by 0.3% and improved 9.1% from the year-ago quarter.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported impressive third-quarter fiscal 2023 results, wherein both earnings and revenues beat the Zacks Consensus Estimate. Quarterly adjusted earnings per share of $1.07 beat the Zacks Consensus Estimate by 4.9% and increased 4.9% on a year-over-year basis.
BAH’s total revenues of $2.3 billion beat the Zacks Consensus Estimate by 4% and increased 12.1% on a year-over-year basis.
Free Report – The Bitcoin Profit Phenomenon
Zacks Investment Research has released a Special Report to help you pursue massive profits from the world’s first and largest decentralized form of money.
No guarantees for the future, but in the past three presidential election years, Bitcoin’s returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%.
Zacks predicts another significant surge. Click below for Bitcoin: A Tumultuous Yet Resilient History.
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