The Hackett Group Announces Fourth Quarter 2012 Results

"We reported solid fourth quarter and fiscal year results in what continues to be a volatile environment for our clients," stated Ted A Fernandez, Chairman and CEO of the Hackett Group, Inc. "As we look back at the year, we are especially proud of our ability to return a significant amount of capital to our shareholders through a $55 million share repurchase tender offer and our recently initiated annual dividend which we declared and paid prior to year end. As we look forward, we continue to believe that our unique intellectual capital and expanding brand permission coupled with our terrific talent bodes well for our future prospects."

Based on the current economic outlook, the Company estimates total revenue for the first quarter of 2013 to be in the range of $55.0 million to $57.0 million, and estimates pro forma diluted earnings per share to be in the range of $0.09 to $0.11. This guidance excludes the operating results of our Oracle ERP implementation practice which we agreed to sell on February 15, 2013.

Other Highlights

Annual Dividend Program - In December 2012, the Company announced that its Board of Directors has approved the initiation of an annual cash dividend program in the amount of $0.10 per share, which is intended to be paid annually. The first dividend was paid on December 28, 2012, to shareholders of record as of the close of business on December 20, 2012.

Enterprise Key Issues Research - A new Enterprise Key Issues study from The Hackett Group found that for 2013, the new "borderless" business environment will present the greatest opportunities to companies in IT, finance, HR and other business services areas, as companies strive to reduce costs and meet aggressive revenue projections. The research identified new opportunities for companies to roll out a flexible, virtual, data-enabled model for service delivery. Companies are also continuing to dramatically accelerate their use of Global Business Services (GBS) operations, an evolution beyond shared services which integrates and consolidates multiple business functions.

World-Class HR Profile - New Book of Numbers ^™ research from The Hackett Group found that world-class HR organizations operate at 27% lower cost per employee than typical companies and also utilize 24% fewer staff, while still achieving higher effectiveness. The Hackett Group's research detailed three important elements of HR strategy that drive operational excellence at world-class HR organizations: an emphasis on enhancing HR’s operational excellence and helping the company achieve its strategic goals; a systematic integrated approach to talent management; and an ability to create strong, strategic working relationships with the business.

Year-End Gamesmanship Research - REL, a division of The Hackett Group, issued research detailing how many large U.S. companies continue to try to "game the system" at year-end, artificially improving their balance sheets by manipulating receivables, payables, and inventory. The study found that their efforts do have a positive impact in the fourth quarter. However, these companies pay a harsh price in the first quarter, when working capital bounces back to even worse levels than before.

Cash Flow Forecasting Study Launch - REL Consulting, a division of The Hackett Group, launched a new performance study designed to help companies compare their cash forecasting practices with top performers. Forecasting cash positions and cash needs continues to be an issue for most organizations. Given the current volatility and uncertainty in the markets, it becomes all the more important for companies to forecast their cash requirements as accurately as possible. By participating in REL's newly-launched Operating Cash Flow Forecasting study, companies can find out how their performance in forecasting operating cash flow compares with other organizations.

On Tuesday, February 19, 2013, senior management will discuss fourth quarter results in a conference call at 5:00 P.M. ET.

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