EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

LOGO

FTI Consulting, Inc.

777 South Flagler Drive, Suite 1500

West Palm Beach, Florida 33401

(561) 515-1900

 

FOR FURTHER INFORMATION:   

AT FTI CONSULTING:

    AT FD:
Jack Dunn, President & CEO    Investors: Gordon McCoun
(561) 515-1900    Media: Andy Maas
   (212) 850-5600

FOR IMMEDIATE RELEASE

FTI CONSULTING, INC. REPORTS 2010 FOURTH QUARTER AND FULL YEAR RESULTS

• Record Fourth Quarter Revenues of $356.2 Million; Full Year of $1.4 Billion

• Fourth Quarter Diluted EPS of $0.23 including Brand Consolidation Charge of $0.33; Adjusted EPS of $0.56

• Full Year Diluted EPS of $1.51; Adjusted EPS of $2.29

• Cash and Equivalents of $384.6 Million

West Palm Beach, FL, February 24, 2011 — FTI Consulting, Inc. (NYSE: FCN), the global business advisory firm dedicated to helping organizations protect and enhance their enterprise value, today reported its financial results for the fourth quarter and the full year ended December 31, 2010.

Revenues for the fourth quarter of 2010 were a fourth quarter record $356.2 million compared to $342.9 million in the prior year period and $346.1 million in the prior sequential quarter. Adjusted earnings per diluted share (EPS) were $0.56 compared to $0.71 in the prior year period. Adjusted EPS exclude a previously announced non-cash charge of approximately $21.8 million, or $0.33 impact on earnings per diluted share, resulting from the decision to unify substantially all operations under a consolidated brand - FTI Consulting - and the associated write off of trade names from certain acquired businesses. GAAP EPS were $0.23. Adjusted EBITDA was $69.3 million, or 19.5 percent of revenues, compared to $80.8 million, or 23.6 percent of revenues, in the prior year period. Adjusted EBITDA, Adjusted Segment EBITDA and Adjusted EPS (which appear in the accompanying tables) are non-GAAP measures and are described in further detail below.

Commenting on these results, Jack Dunn, President and Chief Executive Officer of the Company, said, “Our 2010 fourth quarter results continued the positive momentum we experienced in the third quarter and the validation of our strategy to offer clients a diversified suite of complementary services around the globe

for every cycle of the economy. While in the third quarter our four procyclical businesses offset the decline in our core restructuring activities from the prior year, in the fourth quarter, they more than made up the difference, growing at an impressive average combined rate of 12.9%, led by Technology at 23.6% and FLC at 14.2%, while the rate of decline in Corporate Finance/Restructuring continued to slow. Our business outside the U.S. grew by 13% to 21% of total revenue from 19% in the same period last year.

”Just as importantly, we saw the continuing validation of our intellectual capital and market position. In December, our Corporate Finance/Restructuring practice was again recognized by The Deal magazine as the largest global crisis management firm in both dollar volume and number of transactions at more than two and a half times the nearest competitor. Global Competition Review magazine ranked our Economic Consulting team number one amongst competition specialists for its work in such signature matters as Oracle’s acquisition of Sun Microsystems and the United Airlines/Continental merger. Our International Arbitration practice was recognized as the leader in the Expert Witness Research category by Who’s Who Legal, and our Strategic Communications practice was awarded PR Firm of the Year by Financial Times/mergermarket, leading the league tables in Europe for an unprecedented 10th straight time.

“We enter 2011 with practices that are leaders in their respective markets and a strong financial position, with nearly $385 million in cash and equivalents for acquisitions, share repurchases and investments in our franchise and brand.”

During the quarter, the Company generated $99.2 million in cash from operations, and repurchased approximately 416,000 shares of its common stock for a total purchase price of approximately $14.5 million.

Fourth Quarter Segment Results

Corporate Finance/Restructuring

Revenues in the Corporate Finance/Restructuring segment decreased 9.4 percent to $113.2 million from $124.9 million in the fourth quarter of the prior year. Adjusted Segment EBITDA was $28.9 million, or 25.5 percent of segment revenues, compared with $43.8 million, or 35.1 percent of segment revenues, in the prior year quarter. Demand for restructuring services continued to decline from near-record levels a year-ago as a result of continued improvements in the credit markets and the macroeconomic environment. In addition, the segment saw a decline in healthcare and transaction advisory services compared to the fourth quarter of last year. This was partially offset by contributions from its acquired business in Asia, as well as continued growth in Europe. Adjusted Segment EBITDA margins declined from the prior year due to lower demand and a shift in the revenue mix.

Forensic and Litigation Consulting

Revenues in the Forensic and Litigation Consulting segment increased 14.2 percent to $81.0 million from $70.9 million in the fourth quarter of the prior year. Adjusted Segment EBITDA increased to $18.9 million, or 23.4 percent of segment revenues, compared to $16.6 million, or 23.3 percent of segment revenues, in the prior year quarter. Demand improved in litigation and regulated industries, particularly healthcare, as well as trial services and in Asia.

Economic Consulting

Revenues in the Economic Consulting segment increased 1.9 percent to $64.4 million from $63.2 million in the fourth quarter of the prior year. Adjusted Segment EBITDA was $12.9 million, or 20.0 percent of segment revenues, compared to $13.2 million, or 20.9 percent of segment revenues, for the prior year quarter. The segment continued to see growth in its Financial Economics and International Arbitration practices. M&A activity also strengthened.

Technology

Revenues in the Technology segment increased 23.6 percent to $47.7 million from $38.6 million in the fourth quarter of the prior year. Adjusted Segment EBITDA was $17.9 million, or 37.4 percent of segment revenues, compared to $13.6 million, or 35.1 percent of segment revenues, in the prior year quarter. Demand improved in litigation and investigation matters. During the quarter the segment also benefitted from increased direct license revenues and the continued growth of its Acuity™ offering. Adjusted Segment EBITDA margins improved from the prior year quarter due to the higher revenues.

Strategic Communications

Revenues in the Strategic Communications segment increased 10.2 percent to $49.9 million from $45.3 million in the fourth quarter of the prior year. Adjusted Segment EBITDA was $7.4 million, or 14.9 percent of segment revenues, compared to $6.7 million, or 14.8 percent of segment revenues, in the prior year quarter. Primary regional contributors to the segment’s growth during the quarter were the Americas and Asia-Pacific, which offset a small decline in the UK.

2011 Guidance

Based on current market conditions, the Company estimates that revenues for the year will be between $1.43 billion and $1.49 billion and diluted EPS will be between $2.00 and $2.20. Organic revenue growth is expected to be modest as the trends of the last several quarters are expected to continue. Margins are expected to be lower due to the previously announced costs associated with brand conversion, investments in strengthening infrastructure to support future growth in international markets, higher compensation expense, and increased interest costs associated with the cash raised in October through a bond offering. This guidance assumes no acquisitions and no share repurchases.

Fourth Quarter Conference Call

FTI will hold a conference call for analysts and investors to discuss fourth quarter financial results at 9:00 AM Eastern Time on February 24, 2011. The call can be accessed live and will be available for replay over the Internet for 90 days by logging onto the Company’s website, www.fticonsulting.com.

About FTI Consulting

FTI Consulting, Inc. is a global business advisory firm dedicated to helping organizations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment. With more than 3,600 employees located in most major business centers in the world, we work closely with clients every day to anticipate, illuminate, and overcome complex business challenges in areas such as investigations, litigation, mergers and acquisitions, regulatory issues, reputation management and restructuring. More information can be found at www.fticonsulting.com.

Use of Non-GAAP Measure

Note: We define Adjusted EBITDA as consolidated operating income before depreciation, amortization of intangible assets and special charges plus non-operating litigation settlements. We define Adjusted Segment EBITDA as the segment’s share of consolidated operating income before depreciation, amortization of intangible assets and special charges plus non-operating litigation settlements. We define Adjusted earnings per diluted share (Adjusted EPS) as earnings per diluted share excluding the per share impact of the special charges and debt extinguishment costs that were incurred in that year. Although Adjusted EBITDA, Adjusted Segment EBITDA and Adjusted EPS are not measures of financial condition or performance determined in accordance with generally accepted accounting principles (“GAAP”), we believe that these measures can be a useful operating performance measure for evaluating our results of operations as compared from period to period and as compared to our competitors. EBITDA is a common alternative measure of operating performance used by investors, financial analysts and rating agencies to value and compare the financial performance of companies in our industry. We use Adjusted EBITDA and Adjusted Segment EBITDA to evaluate and compare the operating performance of our segments.

Adjusted EBITDA, Adjusted Segment EBITDA and Adjusted EPS are not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same. These non-GAAP measures should be considered in addition to, but not as a substitute for or superior to, the information contained in our statements of income. Reconciliations of operating profit to Adjusted EBITDA, segment operating profit to Adjusted Segment EBITDA and EPS to Adjusted EPS are included in the accompanying tables to today’s press release.

Safe Harbor Statement

This press release includes "forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, that involve uncertainties and risks. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenues, future results and performance, expectations, plans or intentions relating to acquisitions and other matters, business trends and other information that is not historical, including statements regarding estimates of our future financial results. When used in this press release, words such as “estimates,” “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts” and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, estimates of our future financial results, are based upon our expectations at the time we make them and various assumptions. Our expectations, beliefs and projections are expressed in good faith, and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs and projections will result or be achieved or that actual results will not differ from expectations. The Company has experienced fluctuating revenues, operating income and cash flow in some prior periods and expects this will occur from time to time in the future. The Company’s actual results may differ from our expectations. Further, preliminary results are subject to normal year-end adjustments. Other factors that could cause such differences include adverse financial and real estate market and general economic conditions, the pace and timing of the consummation and integration of past and future acquisitions, the Company's ability to realize cost savings and efficiencies,

competitive and general economic conditions, retention of staff and clients and other risks described under the heading “Item 1A. Risk Factors” in the Company’s most recent Form 10-K and in the Company’s other filings with the Securities and Exchange Commission. We are under no duty to update any of the forward-looking statements to conform such statements to actual results or events and do not intend to do so.

FINANCIAL TABLES FOLLOW

FTI CONSULTING, INC.

CONSOLIDATED STATEMENTS OF INCOME

FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009

(in thousands, except per share data)

 

     Year Ended December 31,  
     2010     2009  

Revenues

    $ 1,401,461      $ 1,399,946   
                

Operating expenses

     

Direct cost of revenues

      815,776        767,387   

Selling, general and administrative expense

      341,314        344,318   

Special charges

      52,020        —     

Amortization of other intangible assets

      23,910        24,701   
                
     1,233,020        1,136,406   
                

Operating income

      168,441        263,540   
                

Other income (expense)

     

Interest income and other

      4,423        8,408   

Interest expense

      (50,263 )      (44,923 ) 

Loss on early extinguishment of debt

      (5,161 )      —     
                
     (51,001 )      (36,515 ) 
                

Income before income tax provision

      117,440        227,025   

Income tax provision

      45,550        83,999   
                

Net income

    $ 71,890      $ 143,026   
                

Earnings per common share - basic

    $ 1.58      $ 2.86   
                

Weighted average common shares outstanding - basic

      45,557        49,963   
                

Earnings per common share - diluted

    $ 1.51      $ 2.70   
                

Weighted average common shares outstanding - diluted

      47,471        53,044   
                

FTI CONSULTING, INC.

CONSOLIDATED STATEMENTS OF INCOME

FOR THE THREE MONTHS ENDED DECEMBER 31, 2010 AND 2009

(in thousands, except per share data)

(unaudited)

 

     Three Months Ended
December 31,		  
     2010     2009  

Revenues

    $ 356,248      $ 342,938   
                

Operating expenses

     

Direct cost of revenues

      205,190        187,590   

Selling, general and administrative expense

      88,915        81,747   

Special charges

      21,775        —     

Amortization of other intangible assets

      5,681        6,331   
                
     321,561        275,668   
                

Operating income

      34,687        67,270   
                

Other income (expense)

     

Interest income and other

      (317 )      2,073   

Interest expense

      (15,663 )      (11,446 ) 
                
     (15,980 )      (9,373 ) 
                

Income before income tax provision

      18,707        57,897   

Income tax provision

      8,031        21,324   
                

Net income

    $ 10,676      $ 36,573   
                

Earnings per common share - basic

    $ 0.24      $ 0.75   
                

Weighted average common shares outstanding - basic

      45,110        48,612   
                

Earnings per common share - diluted

    $ 0.23      $ 0.71   
                

Weighted average common shares outstanding - diluted

      46,693        51,433   
                

FTI CONSULTING, INC.

OPERATING RESULTS BY BUSINESS SEGMENT

(unaudited)

 

     Revenues      Adjusted
EBITDA  (1)		     Margin     Utilization     Average
Billable
Rate		      Revenue-
Generating
Headcount		  
     (in thousands)                           

Three Months Ended December 31, 2010

               

Corporate Finance/Restructuring

    $ 113,220       $ 28,913        25.5 %      69 %    $ 425         725   

Forensic and Litigation Consulting (4)

      81,023         18,925        23.4 %      69 %    $ 322         806   

Economic Consulting

      64,384         12,878        20.0 %      80 %    $ 472         297   

Technology (2)

      47,722         17,870        37.4 %      N/M        N/M         257   

Strategic Communications (2)

      49,899         7,421        14.9 %      N/M        N/M         583   
                                
   $ 356,248         86,007        24.1 %      N/M        N/M         2,668   
                          

Corporate

         (16,668 )          
                    

Adjusted EBITDA (1)

      $ 69,339        19.5 %        
                    

Year Ended December 31, 2010

               

Corporate Finance/Restructuring

    $ 451,518       $ 116,317        25.8 %      70 %    $ 435         725   

Forensic and Litigation Consulting (4)

      324,478         78,244        24.1 %      72 %    $ 324         806   

Economic Consulting

      255,660         49,783        19.5 %      79 %    $ 472         297   

Technology (2)

      176,607         64,896        36.7 %      N/M        N/M         257   

Strategic Communications (2)

      193,198         29,021        15.0 %      N/M        N/M         583   
                                
   $ 1,401,461         338,261        24.1 %      N/M        N/M         2,668   
                          

Corporate

         (62,556 )          
                    

Adjusted EBITDA (1)

      $ 275,705        19.7 %        
                    

Three Months Ended December 31, 2009

               

Corporate Finance/Restructuring

    $ 124,940       $ 43,801        35.1 %      64 %    $ 453         758   

Forensic and Litigation Consulting (3) (4)

      70,935         16,559        23.3 %      69 %    $ 316         754   

Economic Consulting

      63,176         13,224        20.9 %      78 %    $ 453         302   

Technology (2) (3)

      38,622         13,559        35.1 %      N/M        N/M         251   

Strategic Communications (2)

      45,265         6,709        14.8 %      N/M        N/M         573   
                                
   $ 342,938         93,852        27.4 %      N/M        N/M         2,638   
                          

Corporate

         (13,010 )          
                    

Adjusted EBITDA (1)

      $ 80,842        23.6 %        
                    

Year Ended December 31, 2009

               

Corporate Finance/Restructuring

    $ 514,260       $ 175,551        34.1 %      73 %    $ 439         758   

Forensic and Litigation Consulting (3) (4)

      300,710         77,906        25.9 %      76 %    $ 320         754   

Economic Consulting

      234,723         47,845        20.4 %      76 %    $ 456         302   

Technology (2) (3)

      170,174         57,390        33.7 %      N/M        N/M         251   

Strategic Communications (2)

      180,079         24,941        13.9 %      N/M        N/M         573   
                                
   $ 1,399,946         383,633        27.4 %      N/M        N/M         2,638   
                          

Corporate

         (66,378 )          
                    

Adjusted EBITDA (1)

      $ 317,255        22.7 %        
                    

 

(1) We define Adjusted EBITDA as consolidated operating income before depreciation, amortization of intangible assets and special charges plus non-operating litigation settlements. Amounts presented in the Adjusted EBITDA column for each segment reflect the segments' respective Adjusted Segment EBITDA. We define Adjusted Segment EBITDA as a segment's share of consolidated operating income before depreciation, amortization of intangible assets and special charges plus non-operating litigation settlements. Although Adjusted EBITDA, and Adjusted Segment EBITDA are not measures of financial condition or performance determined in accordance with generally accepted accounting principles ("GAAP"), we believe that these measures can be a useful operating performance measure for evaluating our results of operations as compared from period to period and as compared to our competitors. EBITDA is a common alternative measure of operating performance used by investors, financial analysts and rating agencies to value and compare the financial performance of companies in our industry. We use Adjusted EBITDA and Adjusted Segment EBITDA to evaluate and compare the operating performance of our segments.

Adjusted EBITDA and Adjusted Segment EBITDA are not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same. These non-GAAP measures should be considered in addition to, but not as a substitute for or superior to, the information contained in our Statements of Income. See also our reconciliation of non-GAAP financial measures.

 

(2) The majority of the Technology and Strategic Communications segments' revenues are not generated based on billable hours. Accordingly, utilization and average billable rate metrics are not presented as they are not meaningful as a segment-wide metric.
(3) Effective January 1, 2010, we implemented a change in our organizational structure that resulted in the movement of our Financial and Enterprise Data Analytics subpractice from our Technology segment to our Forensic and Litigation Consulting segment. This change has been reflected in our segment reporting for all periods presented.
(4) 2010 utilization and average billable rate calculations for our Forensic and Litigation Consulting segment include information related to non-domestic operations that was not available in 2009.

FTI CONSULTING, INC.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(in thousands, except per share data)

(unaudited)

 

     Three Months Ended
December 31,		      Year Ended
December 31,		  
     2010      2009      2010      2009  

Net income

    $ 10,676       $ 36,573       $ 71,890       $ 143,026   

Add back: Special charges, net of tax

      15,553         —           33,622         —     

Add back: Loss on early extinguishment of debt, net of tax

      —           —           3,019         —     
                                   

Adjusted net income (1)

    $ 26,229       $ 36,573       $ 108,531       $ 143,026   
                                   

Earnings per common share - diluted

    $ 0.23       $ 0.71       $ 1.51       $ 2.70   
                                   

Adjusted earnings per common share - diluted (1)

    $ 0.56       $ 0.71       $ 2.29       $ 2.70   
                                   

Weighted average number of common shares outstanding - diluted

      46,693         51,433         47,471         53,044   
                                   

 

(1) We define Adjusted net income and Adjusted earnings per diluted share as net income and earnings per diluted share, respectively, excluding the impact of the special charges and loss on early extinguishment of debt that were incurred in that period, and their related income tax effects.

RECONCILIATION OF OPERATING INCOME AND NET INCOME TO ADJUSTED EBITDA

(in thousands)

(unaudited)

 

Three Months Ended December 31, 2010   Corporate
Finance /
Restructuring		     Forensic and
Litigation
Consulting (2)		     Economic
Consulting		     Technology  (2)     Strategic
Communi-
cations		     Corp HQ     Total  

Net income

               $ 10,676   

Interest income and other

                 317   

Interest expense

                 15,663   

Loss on early extinguishment of debt

                 —     

Income tax provision

                 8,031   
                   

Operating income

   $ 22,503      $ 17,883      $ 12,180      $ 2,180      $ (2,374 )    $ (17,685 )    $ 34,687   

Depreciation and amortization

     940        853        549        2,872        774        1,208        7,196   

Amortization of other intangible assets

     1,593        723        296        1,832        1,237        —          5,681   

Special charges

     3,877        (534 )      (147 )      10,986        7,784        (191 )      21,775   
                                                       

Adjusted EBITDA (1)

   $ 28,913      $ 18,925      $ 12,878      $ 17,870      $ 7,421      $ (16,668 )    $ 69,339   
                                                       

Year Ended December 31, 2010

              

Net income

               $ 71,890   

Interest income and other

                 (4,423 ) 

Interest expense

                 50,263   

Loss on early extinguishment of debt

                 5,161   

Income tax provision

                 45,550   
                   

Operating income

   $ 95,652      $ 66,240      $ 39,482      $ 28,107      $ 11,652      $ (72,692 )    $ 168,441   

Depreciation and amortization

     3,736        3,325        2,418        13,397        3,226        5,232        31,334   

Amortization of other intangible assets

     6,463        3,653        1,216        7,479        5,099        —          23,910   

Special charges

     10,466        5,026        6,667        15,913        9,044        4,904        52,020   
                                                       

Adjusted EBITDA (1)

   $ 116,317      $ 78,244      $ 49,783      $ 64,896      $ 29,021      $ (62,556 )    $ 275,705   
                                                       

Three Months Ended December 31, 2009

              

Net income

               $ 36,573   

Interest income and other

                 (2,073 ) 

Interest expense

                 11,446   

Income tax provision

                 21,324   
                   

Operating income

   $ 41,282      $ 14,987      $ 12,263      $ 8,614      $ 4,570      $ (14,446 )    $ 67,270   

Depreciation and amortization

     949        692        490        2,888        786        1,436        7,241   

Amortization of other intangible assets

     1,570        880        471        2,057        1,353        —          6,331   
                                                       

Adjusted EBITDA (1)

   $ 43,801      $ 16,559      $ 13,224      $ 13,559      $ 6,709      $ (13,010 )    $ 80,842   
                                                       

Year Ended December 31, 2009

              

Net income

               $ 143,026   

Interest income and other

                 (8,408 ) 

Interest expense

                 44,923   

Income tax provision

                 83,999   
                   

Operating income

   $ 165,757      $ 72,386      $ 43,928      $ 37,669      $ 16,455      $ (72,655 )    $ 263,540   

Depreciation and amortization

     3,462        2,714        1,798        11,478        3,285        6,027        28,764   

Amortization of other intangible assets

     6,332        2,806        2,119        8,243        5,201        —          24,701   

Non-operating litigation settlements

     —          —          —          —          —          250        250   
                                                       

Adjusted EBITDA (1)

   $ 175,551      $ 77,906      $ 47,845      $ 57,390      $ 24,941      $ (66,378 )    $ 317,255   
                                                       

 

(1) We define Adjusted EBITDA as consolidated operating income before depreciation, amortization of intangible assets and special charges plus non-operating litigation settlements. Amounts presented in the Adjusted EBITDA column for each segment reflect the segments’ respective Adjusted Segment EBITDA. We define Adjusted Segment EBITDA as a segment’s share of consolidated operating income before depreciation, amortization of intangible assets and special charges plus non-operating litigation settlements. Although Adjusted EBITDA, and Adjusted Segment EBITDA are not measures of financial condition or performance determined in accordance with generally accepted accounting principles (“GAAP”), we believe that these measures can be a useful operating performance measure for evaluating our results of operations as compared from period to period and as compared to our competitors. EBITDA is a common alternative measure of operating performance used by investors, financial analysts and rating agencies to value and compare the financial performance of companies in our industry. We use Adjusted EBITDA and Adjusted Segment EBITDA to evaluate and compare the operating performance of our segments.

Adjusted EBITDA and Adjusted Segment EBITDA are not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same. These non-GAAP measures should be considered in addition to, but not as a substitute for or superior to, the information contained in our Statements of Income. See also our reconciliation of non-GAAP financial measures.

 

(2) Effective January 1, 2010, we implemented a change in our organizational structure that resulted in the movement of our Financial and Enterprise Data Analytics subpractice from our Technology segment to our Forensic and Litigation Consulting segment. This change has been reflected in our segment reporting for all periods.

FTI CONSULTING, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED December 31, 2010 and 2009

(in thousands)

 

     Year Ended December 31,  
     2010     2009  

Operating activities

     

Net income

    $ 71,890      $ 143,026   

Adjustments to reconcile net income to net cash provided by operating activities:

     

Depreciation and amortization

      31,334        28,765   

Amortization and impairment of other intangible assets

      47,666        24,702   

Provision for doubtful accounts

      10,720        19,866   

Non-cash share-based compensation

      27,121        25,631   

Excess tax benefits from share-based compensation

      (204 )      (5,193 ) 

Non-cash interest expense

      12,670        7,214   

Other

      1,667        (1,604 ) 

Changes in operating assets and liabilities, net of effects from acquisitions:

     

Accounts receivable, billed and unbilled

      (18,881 )      (13,314 ) 

Notes receivable

      (24,500 )      (18,364 ) 

Prepaid expenses and other assets

      1,136        1,334   

Accounts payable, accrued expenses and other

      19,033        (14,179 ) 

Income taxes

      12,176        29,877   

Accrued compensation

      9,357        20,090   

Billings in excess of services provided

      (6,131 )      2,918   
                

Net cash provided by operating activities

      195,054        250,769   
                

Investing activities

     

Payments for acquisition of businesses, including contingent payments, net of cash received

      (63,086 )      (46,710 ) 

Purchases of property and equipment

      (22,600 )      (28,557 ) 

Purchases of short-term investments

      —          (35,717 ) 

Proceeds from sale or maturity of short-term investments

      15,000        20,576   

Other

      (400 )      520   
                

Net cash used in investing activities

      (71,086)        (89,888)   
                

Financing activities

     

Borrowings under revolving line of credit

      20,000        —     

Payments of revolving line of credit

      (20,000 )      —     

Payments of long-term debt and capital lease obligations

      (209,747 )      (13,761 ) 

Issuance of debt securities

      390,445        —     

Payments of debt financing fees

      (3,054 )      —     

Cash received for settlement of interest rate swaps

      —          2,288   

Purchase and retirement of common stock

      (40,634 )      (250,000 ) 

Net issuance of common stock under equity compensation plans

      6,196        15,699   

Excess of tax benefits from share-based compensation

      204        5,193   

Other

      442        303   
                

Net cash provided by (used in) financing activities

      143,852        (240,278)   
                

Effect of exchange rate changes on cash and cash equivalents

      (2,122 )      6,427   
                

Net increase (decrease) in cash and cash equivalents

      265,698        (72,970 ) 

Cash and cash equivalents, beginning of period

      118,872        191,842   
                

Cash and cash equivalents, end of period

    $ 384,570      $ 118,872   
                

FTI CONSULTING, INC.

CONSOLIDATED BALANCE SHEETS

AS OF DECEMBER 31, 2010 AND DECEMBER 31, 2009

(in thousands, except per share amounts)

 

     December 31,
2010		     December 31,
2009		  
Assets     

Current assets

     

Cash and cash equivalents

    $ 384,570      $ 118,872   

Restricted cash

      10,518        —     

Accounts receivable:

     

Billed receivables

      268,386        241,911   

Unbilled receivables

      120,896        104,959   

Allowance for doubtful accounts and unbilled services

      (63,205 )      (59,328 ) 
                

Accounts receivable, net

      326,077        287,542   

Current portion of notes receivable

      26,130        20,853   

Prepaid expenses and other current assets

      28,174        45,157   

Income taxes receivable

      13,246        7,015   

Deferred income taxes

      —          20,476   
                

Total current assets

      788,715        499,915   

Property and equipment, net of accumulated depreciation

      73,238        80,678   

Goodwill

      1,269,447        1,195,949   

Other intangible assets, net of amortization

      134,970        175,962   

Notes receivable, net of current portion

      87,677        69,213   

Other assets

      60,312        55,621   
                

Total assets

    $ 2,414,359      $ 2,077,338   
                
Liabilities and Stockholders’ Equity     

Current liabilities

     

Accounts payable, accrued expenses and other

    $ 105,864      $ 81,193   

Accrued compensation

      143,971        152,807   

Current portion of long-term debt and capital lease obligations

      7,559        138,101   

Billings in excess of services provided

      27,836        34,101   

Deferred income taxes

      4,052        —     
                

Total current liabilities

      289,282        406,202   

Long-term debt and capital lease obligations, net of current portion

      785,563        417,397   

Deferred income taxes

      92,134        95,704   

Other liabilities

      80,061        53,821   
                

Total liabilities

      1,247,040        973,124   
                

Stockholders’ equity

     

Preferred stock, $0.01 par value; shares authorized — 5,000; none outstanding

      —          —     

Common stock, $0.01 par value; shares authorized — 75,000; shares issued and outstanding — 46,144 (2010) and 46,985 (2009)

      461        470   

Additional paid-in capital

      532,929        535,754   

Retained earnings

      687,419        615,529   

Accumulated other comprehensive loss

      (53,490 )      (47,539 ) 
                

Total stockholders’ equity

      1,167,319        1,104,214   
                

Total liabilities and stockholders’ equity

    $ 2,414,359      $ 2,077,338