Charles River Associates, a provider of management, economic and financial consulting services, announced financial results for its fiscal fourth quarter, the twelve weeks ended November 27, and for its full fiscal year 2010.
In a release on January 13, the Company reported that revenue for the fourth quarter of fiscal 2010 was $75.9 million, compared with $74.6 million for the fourth quarter of fiscal 2009. Non-GAAP revenue for the fourth quarter of fiscal 2010 was $74.5 million, compared with $72.8 million in the same period of fiscal 2009 and $61.8 million for the third quarter of fiscal 2010 on a normalized basis. With the third quarter consisting of 16 weeks, the Company is providing results on a "normalized" basis in order to compare it with the sequential fourth quarter, which is a 12-week period.
Net income for the fourth quarter of fiscal 2010 was $1.8 million, or $0.17 per diluted share, compared with net income of $2.0 million, or $0.18 per diluted share, in the same period a year ago. Non-GAAP net income for the fourth quarter of fiscal 2010 was $3.7 million, or $0.35 per diluted share, compared with $3.5 million, or $0.32 per diluted share, in the same period of fiscal 2009. For the third quarter of fiscal 2010, on a normalized basis, non-GAAP net income was $2.4 million, or $0.22 per diluted share.
"Following the improved performance we achieved in the third quarter, our fourth quarter results continued to put us on the right track," said Paul Maleh, CRA's President and Chief Executive Officer. "In the fourth quarter, we experienced broad-based improvements within both Litigation and Management Consulting as the majority of our practices delivered sequential revenue growth compared with a normalized third quarter. Our top-line grew by more than 20 percent sequentially on a normalized basis, highlighted by strong performance in our Competition, Finance, Global Industrial Consulting, Intellectual Property and Marakon Practices. The heightened level of activity from many of our practices drove our utilization to 73 percent, which exceeded our goal of 70 percent for the quarter and represented our highest rate in more than two years."
"During the fourth quarter, we continued to improve our operating margin and boost profitability," Maleh said. "On a non-GAAP basis, our operating margin increased on both a year-over-year and sequential normalized basis. Our results reflect the progress we have made in the past year in resetting our cost structure and concentrating our resources on the most promising areas. Our non-GAAP operating margin was 9.5 percent - exceeding the 8.0 percent we recorded in the third quarter and 8.9 percent reported in the fourth quarter of fiscal 2009."
Full-Year Fiscal 2010 Results
Revenue for fiscal 2010 was $287.4 million, compared with $301.6 million for fiscal 2009. Non-GAAP revenue for fiscal 2010 was $281.0 million, compared with $292.8 million for fiscal 2009.
Net income for fiscal 2010 was $2.6 million, or $0.24 per diluted share, compared with fiscal 2009 net income of $6.3 million, or $0.59 per diluted share. Non-GAAP net income in fiscal 2010 was $9.4 million, or $0.87 per diluted share, compared with 2009 non-GAAP net income of $11.5 million, or $1.07 per diluted share.
"Fiscal 2010 was a challenging year as we worked to recover from the slow start to the year and the uncertain business environment," said Maleh. "However, we developed and successfully executed a comprehensive plan to counter the challenges and are ending the year with positive momentum. We expanded our client-facing activities to ensure a stronger pipeline of new engagements. We broadened our collaborations across practices to foster more cross-selling opportunities. We invested in our people, particularly in the areas of business development and client service, and recruited senior level individuals who could rapidly deliver revenue. These activities have enabled us to conclude fiscal 2010 with stronger prospects for growth."
"In addition, we created a more efficient and scalable infrastructure by reducing costs and fostering improved productivity," Maleh said. "We better aligned staffing levels with our revenue, renegotiated leases and lowered our office rental expenses, and limited hiring within our administrative operations. Each action was carefully targeted, so as not to jeopardize our immediate and longer-term growth prospects, and we closed the year as a leaner and more efficient organization."
"We are encouraged by the sequential growth achieved in the fourth quarter and the improvement in our consulting staff's utilization," said Maleh. "Entering fiscal 2011, we are better positioned for sustained growth with an improving operating margin, a healthy operating cash flow and strong balance sheet, a streamlined organization, and an outstanding reputation for our services."
"Going forward, we will continue to seek opportunities to deepen our client relationships, simplify our internal processes, and generate balanced and profitable growth across the company. While we remain cautious about our clients' spending environment, we see signs of business conditions starting to improve within our markets and enter fiscal 2011 cautiously optimistic," Maleh concluded.