Management services provider
CRA International Inc.
) reported adjusted net income of $3.5 million or 35 cents per
share versus $3.1 million or 31 cents per share in the
year-earlier quarter, comfortably beating the Zacks Consensus
Estimate of 28 cents. The increase in net income was driven by
broad-based contributions from both Litigation/Regulatory and
Management Consulting segments.
For the reported quarter, GAAP net income stood at $3.4 million
or 34 cents per share versus $3.0 million or 29 cents per share
in the year-ago quarter.
Revenues for first-quarter 2014 increased to $76.2 million from
$63.1 million in the prior-year quarter. Quarterly revenues beat
the Zacks Consensus Estimate of $68 million as well.
Healthy year-over-year revenue growth and profitability were
attributable to solid performances in both North America and
Europe. Its business areas such as Antitrust and Competition
Economics, Financial Economics, Life Sciences, Marakon and
Transfer Pricing recorded revenue growth of over 20% each.
Company-wide utilization improved to 78% in first-quarter 2014
from 67% in the year-ago period.
Adjusted gross profit improved to $23.6 million from $20.4
million in the year-ago quarter. After excluding the effects of
its subsidiary NeuCo's operations, adjusted selling, general and
administrative expenses decreased to 21.6% of revenues from 24.0%
in first-quarter 2013 due to sustained cost control initiatives.
Adjusted earnings before interest, taxes, depreciation and
amortization (EBITDA) on a non-GAAP basis were $12.1 million in
the reported quarter compared with $8.7 million in the year-ago
quarter, driven by top line growth as well as a more streamlined
At quarter end, cash and cash equivalents were $32.5 million
compared with $51.3 million on Dec 28, 2013. The decrease in cash
reserves was primarily due to $30 million bonus paid to
employees. Long-term liabilities stood at $7.8 million at the end
of the quarter.
The company recorded capital expenditures of around $0.4 million
in the reported quarter, compared with $1.2 million in the
CRA International has a share repurchase program in place of up
to $15.0 million, which it will finance with available cash and
purchase of shares either in the open market or in privately
negotiated transactions. During the quarter, the company
repurchased around 96,000 shares of common stock worth
approximately $2.1 million.
CRA International is encouraged by the strong momentum in its
operations. Going forward, the company expects an improved cost
structure and broad-based profitable growth and attractive
margins. However, macroeconomic pressures remain a cause of
concern if they translate to a negative trend in client spending
patterns. Through most of 2014, the company anticipates healthy
lead flow activity and strong project conversions.
CRA International currently has a Zacks Rank #3 (Hold). Stocks
that look promising and are worth a look in the industry include
Bureau Veritas SA
Corporate Executive Board Co.
), each carrying a Zacks Rank #2 (Buy).
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