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Franklin Covey Reports Strong Third Quarter Fiscal 2012 Financial Results – Now Expects To Exceed The High End Of Its Previous Adjusted EBITDA Guidance Range For Fiscal 2012 Year

Stocks in this article: FC

Franklin Covey Co. (NYSE: FC), a content and intellectual property company that creates and distributes world-class content, training, processes, and tools that organizations and individuals use to transform their results, today announced financial results for its fiscal third quarter ended May 26, 2012.

The Company reported strong financial results for the third quarter of fiscal 2012, with revenues increasing to $41.3 million compared with $40.9 million in the third quarter of fiscal 2011 and $30.5 million in the third quarter of fiscal 2010. Adjusted EBITDA for the quarter rose 10% to $5.8 million, compared with $5.2 million in the third quarter of fiscal 2011 and $2.0 million in the third quarter of fiscal 2010. For the trailing 4 quarters, Adjusted EBITDA totaled $24.1 million, up $2.6 million, or 12%, compared with the same period of fiscal 2011. With the significant flow-through of revenue to Adjusted EBITDA, the Company’s Adjusted EBITDA margin (Adjusted EBITDA as a percent of sales) increased to 13.9% in the third quarter of fiscal 2012 compared with 12.8% in the prior year. For the trailing four quarters ended May 26, 2012, the Company’s Adjusted EBITDA margin increased to 14.6% compared with 13.4% for the same period of fiscal 2011. Increased sales, improved operating margins, and a decreased effective income tax rate combined to more than double net income for the quarter to $1.6 million ($.09 per diluted share) compared with $0.7 million ($.04 per diluted share) in the third quarter of fiscal 2011. Cash flows from Operating Activities was $18.1 million for the trailing 4 quarters and the Company had cash totaling $6.5 million at May 26, 2012 with no borrowings outstanding on its line of credit facility.

Bob Whitman, Chairman and Chief Executive Officer of Franklin Covey, commented, “We are very pleased with the results achieved in our fiscal third quarter, and by the significant momentum we are seeing in our business, which drove a 23% increase in our Pipeline of Booked Days and Awarded Revenue during the quarter. We were also pleased that after achieving 34% revenue growth and 161% Adjusted EBITDA growth in last year’s third quarter, we were able to increase both revenue and Adjusted EBITDA in this year’s third quarter. We expect to achieve strong growth in both revenue and profitability during our fiscal fourth quarter, positioning us for continued strong growth in fiscal 2013.”

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