Huron announces fourth quarter and full year 2021 financial results, and provides 2022 guidance
Chicago--(business wire)--global professional services firm huron (nasdaq: hurn) today announced financial results from continuing operations for the fourth quarter ended december 31, 2021. “we continued to deliver on our commitment to sustainable revenue growth and improved profitability, demonstrated by our q4 2021 and full year results,” said james h. roth, chief executive officer, huron. “led by organic growth across all three operating segments, annual revenues grew 7% and full year adjusted ebitda margin improved 50 basis points over the prior year. we believe favorable market conditions across our core industries will provide a solid foundation for continued growth and profitability into 2022 as our clients address strategic and operational uncertainties.” “we recently established a new operating model to strengthen our go-to-market strategy and better position huron to integrate our deep industry expertise with our strong digital, strategy and financial advisory capabilities. our business alignment builds upon the historical collaboration across our teams while creating a platform to drive greater efficiencies companywide, which we believe will provide improved growth and profitability for our shareholders,” added roth. covid-19 impact the worldwide spread of the coronavirus (covid-19) has created significant volatility, uncertainty and disruption to the global economy. the company continues to closely monitor the impact of the pandemic on all aspects of its business, including how it will impact its clients, employees and business partners. in most of 2020 and the first quarter of 2021, the covid-19 pandemic negatively impacted sales and elongated the sales cycle for new opportunities for certain services, particularly within the company's healthcare and education segments as some clients reprioritized or delayed certain projects. conversely, the pandemic strengthened demand for the company's cloud-based technology and analytics solutions and certain services provided to organizations in transition within the company's business advisory segment. beginning in the second quarter of 2021 and continuing through the end of 2021, the company saw an increase in its sales pipeline and the pace of signings, particularly within its healthcare and education businesses, as well as strengthened demand across all segments. as a result, fourth quarter and full year 2021 revenues increased compared to the same prior year periods. the company expects continued revenue growth in 2022 compared to 2021. fourth quarter 2021 results from continuing operations revenues increased $49.9 million, or 25.2%, to $248.3 million for the fourth quarter of 2021 compared to $198.3 million for the fourth quarter of 2020. net income from continuing operations increased to $31.1 million for the fourth quarter of 2021, compared to a net loss from continuing operations of $6.1 million for the same quarter last year. diluted earnings per share from continuing operations was $1.45 for the fourth quarter of 2021, compared to diluted loss per share from continuing operations of $0.28 for the fourth quarter of 2020. results for the fourth quarter of 2021 include a $23.7 million gain, net of tax from the sale of the company's life sciences business in the fourth quarter of 2021. results for the fourth quarter of 2020 reflect $13.9 million of restructuring charges, net of tax related to the fourth quarter 2020 restructuring plan. fourth quarter 2021 earnings before interest, taxes, depreciation and amortization ("ebitda")(8) was $50.0 million compared to loss before interest, taxes, depreciation and amortization of $1.9 million in the same prior year period. 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): three months ended december 31, 2021 2020 amortization of intangible assets $ 2,328 $ 3,138 restructuring and other charges $ 9,235 $ 18,748 litigation and other losses $ 100 $ — (gain) loss on sale of businesses(1) $ (31,510 ) $ 1,501 transaction-related expenses $ 1,447 $ 695 unrealized gain on preferred stock investment $ — $ (1,667 ) tax effect of adjustments $ 4,530 $ (6,158 ) foreign currency transaction losses (gains), net $ 21 $ (276 ) ______________________ (1) on november 1, 2021, the company completed the divestiture of its life sciences commercial and r&d strategy, pricing and market access strategy business (the "life sciences business"), and recognized a $31.5 million pre-tax gain related to the sale. the life sciences business generated revenues of $1.9 million in october 2021. adjusted ebitda(8) increased $12.2 million, or 71.7%, to $29.3 million, or 11.8% of revenues, in the fourth quarter of 2021, compared to $17.1 million, or 8.6% of revenues, in the same quarter last year. adjusted net income from continuing operations(8) increased $7.0 million to $17.2 million, or $0.80 per diluted share, for the fourth quarter of 2021, compared to $10.2 million, or $0.45 per diluted share, for the quarter in 2020. the average number of billable consultants(2) increased 9.7% to 2,880 in the fourth quarter of 2021 from 2,626 in the same quarter last year. billable consultant utilization rate(3) was 70.0% during the fourth quarter of 2021 compared to 68.0% during the same period last year. average billing rate per hour for our billable consultants(4) was $231 for the fourth quarter of 2021 compared to $206 for the same prior year period. the average number of full-time equivalent professionals(6) was 301 in the fourth quarter of 2021 compared to 263 for the same period in 2020. the average number of healthcare managed services employees(7) was 513 in the fourth quarter of 2021 compared to 92 for the same period in 2020. this operating data has been revised from previously reported amounts as the company began assessing its operating performance by the following three employee types in the second quarter of 2021: billable consultants, full-time equivalents, and healthcare managed services employees. full year 2021 results from continuing operations revenues increased $61.5 million, or 7.3%, to $905.6 million for full year 2021, compared to $844.1 million for full year 2020. net income from continuing operations was $63.0 million for full year 2021, compared to a net loss from continuing operations of $23.7 million for full year 2020. diluted earnings per share from continuing operations was $2.89 for full year 2021, compared to diluted loss per share from continuing operations of $1.08 for full year 2020. results for full year 2021 include a $23.7 million gain, net of tax from the sale of the company's life sciences business in the fourth quarter of 2021. results for full year 2020 reflect non-cash goodwill impairment charges, net of tax totaling $45.3 million to reduce the carrying value of goodwill in the company's strategy and innovation and life sciences reporting units within the business advisory segment and $13.9 million of restructuring charges, net of tax related to the fourth quarter 2020 restructuring plan. ebitda(8) was $114.5 million for the full year 2021, compared to $5.1 million for full year 2020. 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): twelve months ended december 31, 2021 2020 amortization of intangible assets $ 9,251 $ 12,696 restructuring and other charges $ 12,401 $ 21,374 litigation and other losses (gains), net $ 198 $ (150 ) goodwill impairment charges $ — $ 59,816 unrealized gain on preferred stock investment $ — $ (1,667 ) (gain) loss on sale of businesses(1) $ (31,510 ) $ 1,603 transaction-related expenses $ 1,782 $ 1,132 tax effect of adjustments $ 1,742 $ (23,199 ) foreign currency transaction losses, net $ 419 $ (31 ) _____________________ (1) on november 1, 2021, the company completed the divestiture of its life sciences business, and recognized a $31.5 million pre-tax gain related to the sale. the life sciences business generated revenues of $16.7 million during the ten months ended october 31, 2021. adjusted ebitda(8) increased $10.7 million, or 12.3%, to $97.8 million, or 10.8% of revenues, for full year 2021 compared to $87.1 million, or 10.3% of revenues, for full year 2020. adjusted net income from continuing operations(8) increased $9.0 million to $56.9 million, or $2.61 per diluted share, for full year 2021 compared to $47.9 million, or $2.15 per diluted share, for full year 2020. the average number of billable consultants(2) increased 4.5% to 2,716 for full year 2021 from 2,600 for the same prior year period. billable consultant utilization rate(3) was 71.1% for full year 2021, compared to 70.7% in the same period last year. average billing rate per hour for billable consultants(4) was $209 for full year 2021, compared to $202 in the same period last year. the average number of full-time equivalent professionals(6) was 258 for full year 2021 compared to 269 for the same prior year period. the average number of healthcare managed services employees(7) was 382 for full year 2021 compared to 91 for the same period in 2020. this operating data has been revised from previously reported amounts as the company began assessing its operating performance by the following three employee types in the second quarter of 2021: billable consultants, full-time equivalents, and healthcare managed services employees. operating segments huron’s results reflect a portfolio of service offerings focused on helping clients address complex business challenges. the company’s full year 2021 revenues by operating segment as a percentage of total company revenues are as follows: healthcare (42%); business advisory (32%); and education (26%). financial results by segment are included in the attached schedules and in huron's forthcoming annual report on form 10-k filing for the year ended december 31, 2021. outlook for 2022 based on currently available information, the company provided guidance for full year 2022 revenues before reimbursable expenses in a range of $970.0 million to $1.03 billion. the company anticipates adjusted ebitda as a percentage of revenues in a range of 11.3% to 12.3% and non-gaap adjusted diluted earnings per share in a range of $2.85 to $3.35. management will provide a more detailed discussion of its outlook during the company's earnings conference call webcast. fourth quarter 2021 webcast the company will host a webcast to discuss its financial results today, february 24, 2022, at 5:00 p.m. eastern time, 4:00 p.m. central time. the conference call is being webcast by nasdaq 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. 2022 business realignment and changes to segment reporting effective january 1, 2022, huron has modified its operating model to expand and more deeply integrate the company’s industry expertise with its digital, strategic and financial advisory capabilities. the new operating model will strengthen huron’s go-to-market strategy, drive efficiencies that support margin expansion, and position the company to accelerate growth. to align with the new operating model, effective with reporting for periods beginning january 1, 2022, the company will begin reporting under the following three industries, which will be the company's reportable segments: healthcare, education and commercial. the commercial segment will include all industries outside of healthcare and education, including, but not limited to, financial services and energy and utilities. in the new reporting structure, each segment will include all revenues and costs associated with engagements delivered in the respective industry segment. the new healthcare and education segments will include some revenues and costs historically reported in the business advisory segment and the healthcare segment will include certain revenues and costs historically reported in the education segment. the company will also provide revenue reporting across two principal capabilities: i) consulting and managed services and ii) digital. these changes will provide greater transparency for investors by improving visibility into the core drivers of the business. supplemental materials that include unaudited recast summary financial information and other operating data according to the new reporting segments can be found on the investor relations section of huron's website at http://ir.huronconsultinggroup.com. virtual investor day huron will host an investor day on tuesday, march 29, 2022. the investor day will be held virtually and begin at 9:00 a.m. eastern time (8:00 a.m. central time). interested parties are encouraged to pre-register for the event here and log in to the webcast approximately 10 minutes prior to the start of the event. chief executive officer james h. roth, chief financial officer john d. kelly, president and chief operating officer c. mark hussey and other members of huron’s leadership team will provide an update on the company’s strategy and segment reporting changes. in addition to management’s prepared remarks, there will be a question-and-answer session. after the conclusion of the event, a transcript and a replay of the video webcast, including the q&a session, will be available on the investor relations section of huron’s website at http://ir.huronconsultinggroup.com and will be available for one year. use of non-gaap financial measures(8) in evaluating the company’s financial performance and outlook, management uses ebitda, adjusted ebitda, adjusted ebitda as a percentage of revenues, adjusted net income from continuing operations, and adjusted diluted earnings per share from continuing operations, 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 consultancy that collaborates with clients to drive strategic growth, ignite innovation and navigate constant change. through a combination of strategy, expertise and creativity, we help clients accelerate operational, digital and cultural transformation, enabling the change they need 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,” “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: the impact of the covid-19 pandemic on the economy, our clients and client demand for our services, and our ability to sell and provide services, including the measures taken by governmental authorities and businesses in response to the pandemic, which may cause or contribute to other risks and uncertainties that we face; failure to achieve expected utilization rates, billing rates and the 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, 2021 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 december 31, twelve months ended december 31, 2021 2020 2021 2020 revenues and reimbursable expenses: revenues $ 248,294 $ 198,347 $ 905,640 $ 844,127 reimbursable expenses 12,442 1,754 21,318 26,887 total revenues and reimbursable expenses 260,736 200,101 926,958 871,014 direct costs and reimbursable expenses (exclusive of depreciation and amortization shown in operating expenses): direct costs 173,233 141,207 636,776 592,428 amortization of intangible assets and software development costs 1,058 1,361 3,803 5,366 reimbursable expenses 12,136 1,823 21,369 26,918 total direct costs and reimbursable expenses 186,427 144,391 661,948 624,712 operating expenses and other losses (gains), net: selling, general and administrative expenses 49,410 43,822 177,886 170,686 restructuring charges 9,235 18,748 12,401 20,525 litigation and other losses (gains) 100 — 198 (150 ) depreciation and amortization 5,400 5,794 21,686 24,277 goodwill impairment charges — — — 59,816 total operating expenses and other losses (gains), net 64,145 68,364 212,171 275,154 operating income (loss) 10,164 (12,654 ) 52,839 (28,852 ) other income (expense), net: interest expense, net of interest income (2,185 ) (1,776 ) (8,150 ) (9,292 ) other income, net 33,170 3,584 35,347 4,271 total other income (expense), net 30,985 1,808 27,197 (5,021 ) income (loss) from continuing operations before taxes 41,149 (10,846 ) 80,036 (33,873 ) income tax expense (benefit) 10,091 (4,742 ) 17,049 (10,155 ) net income (loss) from continuing operations 31,058 (6,104 ) 62,987 (23,718 ) loss from discontinued operations, net of tax — (33 ) — (122 ) net income (loss) $ 31,058 $ (6,137 ) $ 62,987 $ (23,840 ) net earnings (loss) per basic share: net income (loss) from continuing operations $ 1.48 $ (0.28 ) $ 2.94 $ (1.08 ) loss from discontinued operations, net of tax — — — (0.01 ) net income (loss) $ 1.48 $ (0.28 ) $ 2.94 $ (1.09 ) net earnings (loss) per diluted share: net income (loss) from continuing operations $ 1.45 $ (0.28 ) $ 2.89 $ (1.08 ) loss from discontinued operations, net of tax — — — (0.01 ) net income (loss) $ 1.45 $ (0.28 ) $ 2.89 $ (1.09 ) weighted average shares used in calculating earnings (loss) per share: basic 21,039 21,903 21,439 21,882 diluted 21,466 21,903 21,809 21,882 comprehensive income (loss): net income (loss) $ 31,058 $ (6,137 ) $ 62,987 $ (23,840 ) foreign currency translation adjustments, net of tax (1,161 ) 642 (925 ) 348 unrealized gain on investment, net of tax 3,237 2,374 1,169 1,323 unrealized gain (loss) on cash flow hedging instruments, net of tax 1,579 87 3,535 (3,546 ) other comprehensive income (loss) 3,655 3,103 3,779 (1,875 ) comprehensive income (loss) $ 34,713 $ (3,034 ) $ 66,766 $ (25,715 ) huron consulting group inc. consolidated balance sheets (in thousands, except share and per share amounts) (unaudited) december 31, 2021 december 31, 2020 assets current assets: cash and cash equivalents $ 20,781 $ 67,177 receivables from clients, net 122,316 87,687 unbilled services, net 91,285 53,959 income tax receivable 8,071 5,121 prepaid expenses and other current assets 15,229 16,569 total current assets 257,682 230,513 property and equipment, net 31,004 29,093 deferred income taxes, net 1,804 4,191 long-term investments 72,584 71,030 operating lease right-of-use assets 35,311 39,360 other non-current assets 68,191 62,068 intangible assets, net 31,894 20,483 goodwill 620,879 594,237 total assets $ 1,119,349 $ 1,050,975 liabilities and stockholders’ equity current liabilities: accounts payable $ 13,621 $ 648 accrued expenses and other current liabilities 22,519 14,874 accrued payroll and related benefits 139,131 133,830 current maturities of long-term debt 559 499 current maturities of operating lease liabilities 10,142 8,771 deferred revenues 19,212 28,247 total current liabilities 205,184 186,869 non-current liabilities: deferred compensation and other liabilities 43,458 47,131 long-term debt, net of current portion 232,221 202,780 operating lease liabilities, net of current portion 54,313 61,825 deferred income taxes, net 12,273 428 total non-current liabilities 342,265 312,164 commitments and contingencies stockholders’ equity common stock; $0.01 par value; 500,000,000 shares authorized; 24,364,814 and 25,346,916 shares issued, respectively 239 246 treasury stock, at cost, 2,495,172 and 2,584,119 shares, respectively (135,969 ) (129,886 ) additional paid-in capital 413,794 454,512 retained earnings 276,996 214,009 accumulated other comprehensive income 16,840 13,061 total stockholders’ equity 571,900 551,942 total liabilities and stockholders’ equity $ 1,119,349 $ 1,050,975 huron consulting group inc. consolidated statements of cash flows (in thousands) (unaudited) twelve months ended december 31, 2021 2020 cash flows from operating activities: net income (loss) $ 62,987 $ (23,840 ) adjustments to reconcile net income (loss) to cash flows from operating activities: depreciation and amortization 25,978 30,222 non-cash lease expense 6,967 7,763 lease impairment charges — 13,217 share-based compensation 25,857 24,081 amortization of debt discount and issuance costs 794 793 goodwill impairment charges — 59,816 allowances for doubtful accounts 13 1,050 deferred income taxes 12,480 (9,859 ) (gain) loss on sales of businesses, excluding transaction costs (32,824 ) 1,603 change in fair value of contingent consideration liabilities 173 — change in fair value of preferred stock investment — (1,667 ) other, net (421 ) (25 ) changes in operating assets and liabilities, net of acquisition and divestiture: (increase) decrease in receivables from clients, net (39,845 ) 33,051 (increase) decrease in unbilled services, net (38,820 ) 18,876 (increase) decrease in current income tax receivable / payable, net (2,723 ) (3,662 ) (increase) decrease in other assets (2,670 ) (11,972 ) increase (decrease) in accounts payable and other liabilities 10,394 (7,786 ) increase (decrease) in accrued payroll and related benefits (2,636 ) (1,169 ) increase (decrease) in deferred revenues (7,717 ) 6,246 net cash provided by operating activities 17,987 136,738 cash flows from investing activities: purchases of property and equipment (10,871 ) (8,125 ) investment in life insurance policies (1,245 ) (2,462 ) purchases of businesses, net of cash acquired (44,819 ) (8,701 ) purchase of investment securities — (13,000 ) capitalization of internally developed software costs (4,889 ) (8,272 ) proceeds from sale of property and equipment 408 25 divestiture of businesses, net of cash sold 41,273 (1,499 ) net cash used in investing activities (20,143 ) (42,034 ) cash flows from financing activities: proceeds from exercise of stock options 804 1,003 shares redeemed for employee tax withholdings (10,103 ) (7,903 ) share repurchases (64,612 ) (27,141 ) proceeds from bank borrowings 235,000 283,000 repayments of bank borrowings (205,499 ) (288,574 ) net cash used in financing activities (44,410 ) (39,615 ) effect of exchange rate changes on cash 170 484 net increase (decrease) in cash and cash equivalents (46,396 ) 55,573 cash and cash equivalents at beginning of the period 67,177 11,604 cash and cash equivalents at end of the period $ 20,781 $ 67,177 huron consulting group inc. segment operating results and other operating data (unaudited) in conjunction with the company's continuous evaluation of the appropriate level of disaggregation of revenues as the company's business evolves and in consideration of a group hire of approximately 300 employees in the company's healthcare managed services solution within its healthcare segment in the second quarter of 2021, the company began assessing its operating performance by the following three employee types: billable consultants, full-time equivalents, and healthcare managed services employees. the other operating data previously reported for the three and twelve months ended december 31, 2020 was revised below to reflect this change. this change has no impact on the company's consolidated total revenues or total revenues by segment. three months ended december 31, percent increase (decrease) segment and consolidated operating results (in thousands): 2021 2020 healthcare: revenues $ 103,653 $ 85,097 21.8 % operating income $ 25,647 $ 24,094 6.4 % segment operating income as a percentage of segment revenues 24.7 % 28.3 % business advisory: revenues $ 77,922 $ 65,938 18.2 % operating income $ 10,952 $ 10,740 2.0 % segment operating income as a percentage of segment revenues 14.1 % 16.3 % education: revenues $ 66,719 $ 47,312 41.0 % operating income $ 15,561 $ 5,711 172.5 % segment operating income as a percentage of segment revenues 23.3 % 12.1 % total company: revenues $ 248,294 $ 198,347 25.2 % reimbursable expenses 12,442 1,754 n/m total revenues and reimbursable expenses $ 260,736 $ 200,101 30.3 % statements of operations reconciliation: segment operating income $ 52,160 $ 40,545 28.6 % items not allocated at the segment level: other operating expenses 36,836 47,429 (22.3 ) % litigation and other losses 75 — n/m depreciation and amortization 5,085 5,770 (11.9 ) % total operating income (loss) 10,164 (12,654 ) n/m other income 30,985 1,808 n/m income (loss) from continuing operations before taxes $ 41,149 $ (10,846 ) n/m other operating data: number of billable consultants (at period end) (2): healthcare 869 820 6.0 % business advisory 1,116 1,051 6.2 % education 901 737 22.3 % total 2,886 2,608 10.7 % average number of billable consultants (for the period) (2): healthcare 866 834 business advisory 1,148 1,028 education 866 764 total 2,880 2,626 huron consulting group inc. segment operating results and other operating data (continued) (unaudited) three months ended december 31, other operating data (continued): 2021 2020 billable consultant utilization rate (3): healthcare 70.1 % 65.1 % business advisory 68.3 % 71.6 % education 72.1 % 66.1 % total 70.0 % 68.0 % billable consultant average billing rate per hour (4): healthcare $ 276 $ 261 business advisory (5) $ 219 $ 189 education $ 201 $ 179 total (5) $ 231 $ 206 revenue per billable consultant (in thousands): healthcare $ 84 $ 69 business advisory $ 64 $ 60 education $ 63 $ 53 total $ 69 $ 61 average number of full-time equivalents (for the period) (6): healthcare 153 183 business advisory 61 40 education 87 40 total 301 263 revenue per full-time equivalent (in thousands): healthcare $ 124 $ 110 business advisory $ 75 $ 94 education $ 144 $ 170 total $ 120 $ 117 healthcare managed services(7): total revenues (in thousands) $ 12,309 $ 7,171 average number of healthcare managed services employees (for the period) 513 92 huron consulting group inc. segment operating results and other operating data (continued) (unaudited) twelve months ended december 31, percent increase (decrease) segment and consolidated operating results (in thousands): 2021 2020 healthcare: revenues $ 377,577 $ 353,437 6.8 % operating income $ 104,010 $ 94,925 9.6 % segment operating income as a percentage of segment revenues 27.5 % 26.9 % business advisory: revenues $ 291,663 $ 267,361 9.1 % operating income $ 48,236 $ 48,046 0.4 % segment operating income as a percentage of segment revenues 16.5 % 18.0 % education: revenues $ 236,400 $ 223,329 5.9 % operating income $ 52,772 $ 47,503 11.1 % segment operating income as a percentage of segment revenues 22.3 % 21.3 % total company: revenues $ 905,640 $ 844,127 7.3 % reimbursable expenses 21,318 26,887 (20.7 ) % total revenues and reimbursable expenses $ 926,958 $ 871,014 6.4 % statements of operations reconciliation: segment operating income $ 205,018 $ 190,474 7.6 % items not allocated at the segment level: other operating expenses 131,372 135,255 (2.9 ) % litigation and other losses (gains) 173 (150 ) n/m depreciation and amortization 20,634 24,405 (15.5 ) % goodwill impairment charges (1) — 59,816 n/m total operating income (loss) 52,839 (28,852 ) n/m other income (expense), net 27,197 (5,021 ) n/m income (loss) from continuing operations before taxes $ 80,036 $ (33,873 ) n/m other operating data: number of billable consultants (at period end) (2): healthcare 869 820 6.0 % business advisory 1,116 1,051 6.2 % education 901 737 22.3 % total 2,886 2,608 10.7 % average number of billable consultants (for the period) (2): healthcare 822 863 business advisory 1,115 962 education 779 775 total 2,716 2,600 huron consulting group inc. segment operating results and other operating data (continued) (unaudited) twelve months ended december 31, other operating data (continued): 2021 2020 billable consultant utilization rate (3): healthcare 72.0 % 69.0 % business advisory 69.1 % 72.4 % education 73.0 % 70.3 % total 71.1 % 70.7 % billable consultant average billing rate per hour (4): healthcare $ 243 $ 227 business advisory (5) $ 198 $ 195 education $ 190 $ 187 total (5) $ 209 $ 202 revenue per billable consultant (in thousands): healthcare $ 305 $ 272 business advisory $ 246 $ 264 education $ 253 $ 247 total $ 266 $ 262 average number of full-time equivalents (for the period) (6): healthcare 153 187 business advisory 52 30 education 53 52 total 258 269 revenue per full-time equivalent (in thousands): healthcare $ 518 $ 481 business advisory $ 343 $ 455 education $ 743 $ 618 total $ 528 $ 504 healthcare managed services(7): total revenues (in thousands) $ 47,718 $ 28,663 average number of healthcare managed services employees (for the period) 382 91 ______________________ (1) the non-cash goodwill impairment charges are not allocated at the segment level because the underlying goodwill asset is reflective of our corporate investment in the segments. we do not include the impact of goodwill impairment charges in our evaluation of segment performance. (2) consists of our consulting professionals who provide consulting services and generate revenues based on the number of hours worked. (3) utilization rate for billable consultants is calculated by dividing the number of hours billable consultants worked on client assignments during a period by the total available working hours for these consultants during the same period, assuming a forty-hour work week, less paid holidays and vacation days. (4) average billing rate per hour for our billable consultants is calculated by dividing revenues for a period by the number of hours worked on client assignments during the same period. (5) the business advisory segment includes operations of huron eurasia india. absent the impact of huron eurasia india, the average billing rate per hour for the business advisory segment would have been $243 and $203 for the three months ended december 31, 2021 and 2020, respectively; and $216 and $213 for the twelve months ended december 31, 2021 and 2020, respectively. absent the impact of huron eurasia india, huron's consolidated average billing rate per hour would have been $240 and $213 for the three months ended december 31, 2021 and 2020, respectively; and $216 and 209 for the twelve months ended december 31, 2021 and 2020. (6) 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. (7) consists of employees who manage and provide revenue cycle billing, collections, insurance verification and change integrity services to our healthcare clients. huron consulting group inc. reconciliation of net income (loss) from continuing operations to adjusted earnings before interest, taxes, depreciation and amortization (8) (in thousands) (unaudited) three months ended december 31, twelve months ended december 31, 2021 2020 2021 2020 revenues $ 248,294 $ 198,347 $ 905,640 $ 844,127 net income (loss) from continuing operations $ 31,058 $ (6,104 ) $ 62,987 $ (23,718 ) add back: income tax expense (benefit) 10,091 (4,742 ) 17,049 (10,155 ) interest expense, net of interest income 2,185 1,776 8,150 9,292 depreciation and amortization 6,707 7,156 26,347 29,644 earnings (loss) before interest, taxes, depreciation and amortization (ebitda) (8) 50,041 (1,914 ) 114,533 5,063 add back: restructuring and other charges 9,235 18,748 12,401 21,374 litigation and other losses (gains) 100 — 198 (150 ) unrealized gain on preferred stock investment — (1,667 ) — (1,667 ) goodwill impairment charges — — — 59,816 (gain) loss on sale of businesses (31,510 ) 1,501 (31,510 ) 1,603 transaction-related expenses 1,447 695 1,782 1,132 foreign currency transaction losses (gains), net 21 (276 ) 419 (31 ) adjusted ebitda (8) $ 29,334 $ 17,087 $ 97,823 $ 87,140 adjusted ebitda as a percentage of revenues (8) 11.8 % 8.6 % 10.8 % 10.3 % huron consulting group inc. reconciliation of net income (loss) from continuing operations to adjusted net income from continuing operations (8) (in thousands, except per share amounts) (unaudited) three months ended december 31, twelve months ended december 31, 2021 2020 2021 2020 net income (loss) from continuing operations $ 31,058 $ (6,104 ) $ 62,987 $ (23,718 ) weighted average shares - diluted 21,466 21,903 21,809 21,882 diluted earnings (loss) per share from continuing operations $ 1.45 $ (0.28 ) $ 2.89 $ (1.08 ) add back: amortization of intangible assets 2,328 3,138 9,251 12,696 restructuring and other charges 9,235 18,748 12,401 21,374 litigation and other losses (gains) 100 — 198 (150 ) goodwill impairment charges — — — 59,816 unrealized gain on preferred stock investment — (1,667 ) — (1,667 ) (gain) loss on sale of businesses (31,510 ) 1,501 (31,510 ) 1,603 transaction-related expenses 1,447 695 1,782 1,132 tax effect of adjustments 4,530 (6,158 ) 1,742 (23,199 ) total adjustments, net of tax (13,870 ) 16,257 (6,136 ) 71,605 adjusted net income from continuing operations (8) $ 17,188 $ 10,153 $ 56,851 $ 47,887 adjusted weighted average shares - diluted (9) 21,466 22,323 21,809 22,299 adjusted diluted earnings per share from continuing operations (8) $ 0.80 $ 0.45 $ 2.61 $ 2.15 (8) 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, adjusted net income from continuing operations, and adjusted diluted earnings per share from continuing operations, 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. (9) as the company reported a net loss for the three and twelve months ended december 31, 2020, gaap diluted weighted average shares outstanding equals the basic weighted average shares outstanding for that period. the non-gaap adjustments resulted in adjusted net income from continuing operations for the three and twelve months ended december 31, 2020. therefore, dilutive common stock equivalents have been included in the calculation of adjusted diluted weighted average shares outstanding.
