Huron announces second quarter 2018 financial results and updates
2018 guidance
Chicago--(business wire)--global professional services firm huron (nasdaq: hurn) today announced financial results from continuing operations for the second quarter ended june 30, 2018. "our second quarter performance was driven by organic growth across all three segments, reflecting solid demand for our services. we remain encouraged by our prospects for continued growth during the remainder of 2018," said james h. roth, chief executive officer and president of huron. "we continue to make strategic investments that we believe will drive long-term shareholder value through organic growth and increased profitability over time.” second quarter 2018 results from continuing operations revenues increased $16.1 million, or 8.9%, to $197.5 million for the second quarter of 2018, compared to $181.4 million for the second quarter of 2017. net income from continuing operations was $5.9 million for the second quarter of 2018, compared to net loss from continuing operations of $150.5 million for the same period last year. diluted earnings per share from continuing operations was $0.27 for the second quarter of 2018, compared to diluted loss per share from continuing operations of $7.00 for the second quarter of 2017. second quarter 2018 earnings before interest, taxes, depreciation and amortization ("ebitda")(6) was $23.3 million, compared to loss before interest, taxes, depreciation and amortization(6) of $186.6 million in the same period last year. 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): adjusted ebitda(6) was $24.7 million, or 12.5% of revenues, in the second quarter of 2018, compared to $24.5 million, or 13.5% of revenues, in the same quarter last year. adjusted net income from continuing operations(6) increased $2.2 million, or 20.8%, to $12.8 million, or $0.58 per diluted share, for the second quarter of 2018, compared to $10.6 million, or $0.49 per diluted share, for the same period in 2017. the average number of full-time billable consultants(2) increased 5.0% to 2,127 in the second quarter of 2018 from 2,026 in the same quarter last year. full-time billable consultant utilization rate(3) was 76.2% during the second quarter of 2018, compared to 75.1% during the same period last year. average billing rate per hour for full-time billable consultants(4) was $199 for the second quarter of 2018, compared to $194 for the second quarter of 2017. the average number of full-time equivalent professionals(5) was 278 in the second quarter of 2018 compared to 266 for the same period in 2017. year-to-date 2018 results from continuing operations revenues increased $21.0 million, or 5.7%, to $391.2 million for the first half of 2018, compared to $370.3 million for the first half of 2017. revenues for the first six months of 2018 included $6.4 million of incremental revenues due to the full period impact of huron's acquisition of innosight, which was completed in march 2017, as well as revenues from the company's acquisition of the international assets of adi strategies, which was completed in april 2017 and fully integrated into the business advisory segment. net income from continuing operations was $2.6 million for the first half of 2018, compared to net loss from continuing operations of $145.3 million for the first half of 2017. diluted earnings per share from continuing operations was $0.12 for the first half of 2018, compared to diluted loss per share from continuing operations of $6.80 for the same prior year period. ebitda(6) was $35.5 million for first half of 2018, compared to loss before interest, taxes, depreciation, and amortization(6) of $159.8 million in the comparable period last year. 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): adjusted ebitda(6) was $38.4 million, or 9.8% of revenues, in the first half of 2018, compared to $51.6 million, or 13.9% of revenues, in the comparable period last year. adjusted net income from continuing operations(6) was $17.0 million, or $0.78 per diluted share, for the first six months of 2018, compared to $22.4 million, or $1.04 per diluted share, for the comparable period in 2017. the average number of full-time billable consultants(2) increased 6.8% to 2,131 in the first half of 2018, compared to 1,995 in the same period last year. full-time billable consultant utilization rate(3) was 75.0% for the first six months of 2018, compared to 74.5% in the same period last year. average billing rate per hour for full-time billable consultants(4) was $200 for the first half of 2018, compared to $204 for the same period last year. the average number of full-time equivalent professionals(5) was 271 in the first half of 2018, compared to 270 for the comparable period in 2017. operating segments huron’s results reflect a portfolio of service offerings focused on helping clients address complex business challenges. the company’s year-to-date 2018 revenues by operating segment as a percentage of total company revenues are as follows: healthcare (46%); business advisory (29%); and education (25%). financial results by segment are included in the attached schedules and in huron's forthcoming quarterly report on form 10-q filing for the quarter ended june 30, 2018. outlook for 2018(8) based on currently available information, the company updated its outlook for full year 2018. the company now anticipates full year 2018 revenues before reimbursable expenses in a range of $755.0 million to $775.0 million. the company also anticipates net income in a range of $19.5 million to $22.5 million, ebitda in a range of $85.0 million to $91.0 million, and adjusted ebitda in a range of $87.0 million to $93.0 million. gaap diluted earnings per share is expected in a range of $0.85 to $1.05, and non-gaap adjusted diluted earnings per share is expected in a range of $2.00 to $2.20. management will provide a more detailed discussion of its outlook during the company’s earnings conference call webcast. second quarter 2018 webcast the company will host a webcast to discuss its financial results today, july 31, 2018, 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 at 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(6) 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. about huron huron is a global consultancy that helps its clients drive growth, enhance performance and sustain leadership in the markets they serve. the company partners with clients to develop strategies and implement solutions that enable the transformative change its clients need to own their future. 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 requirements and needs, 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,” 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 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, 2017, 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. common stock; $0.01 par value; 500,000,000 shares authorized; 24,987,534 and24,560,468 shares issued at june 30, 2018 and december 31, 2017, respectively treasury stock, at cost, 2,521,246 and 2,443,577 shares at june 30, 2018 anddecember 31, 2017, respectively three months endedjune 30, percentincrease(decrease) six months endedjune 30, percentincrease(decrease) total to adjusted earnings before interest, taxes, depreciation and amortization (6) income tax expense (benefit) to adjusted net income from continuing operations (6) to adjusted earnings before interest, taxes, depreciation and amortization (8) to adjusted net income (8)
