Franklin Covey Company (FC) F1Q2011 Results (Qtr End November 27, 2010) Earnings Call January 5, 2011 5:00 p.m. ET Executives Derek Hatch - Corporate Controller Bob Whitman - Chairman, President and CEO Steve Young - CFO, EVP, Finance, CAO, Corporate Secretary Shawn Moon - EVP, Global Sales and Delivery Jennifer Colosimo - COO, Operations Worldwide, EVP Analysts Joe Jansen - Barrington Research Julian Allen - Spitfire Capital Kevin Hanrahan - KMH Capital Advisors Presentation Operator
Many of these conditions are beyond our control or influence, any one of which may cause future results to differ materially from the company’s current expectations. And there can be no assurance that the company’s actual future performance will meet management’s expectations. These forward-looking statements are based on management’s current expectations and we undertake no obligation to update or revise these forward-looking statements to reflect events or circumstances after the date of today’s presentation.With that out of the way, I would like to turn the time over to our Chairman and Chief Executive Bob Whitman. Thank you. Bob Whitman Thanks, Derek. I'm glad to have the chance to talk with all of you today and appreciate you joining us. Hopefully each of you had the chance to read the press release that was issued about an hour ago. Now I'd like to address some detail behind that. I'd like to organize my comments today around kind of four headlines or themes. First, that we're very pleased with the company's strong performance and results in the first quarter. Second, we are encouraged by the strong booking trends momentum we're continuing to see in the business. Third, based on these trends, we expect to achieve significant continued improvement in both revenues and profitability during 2011 and beyond. And fourth, we believe we have the opportunity to significantly accelerate our growth in the future perhaps beyond what we've talked about in the past, and I'll hit some headlines there. So I'd just like to now maybe provide some detail behind each of these themes, the first one, being pleased with the company's performance in the first quarter. As you saw from a revenue perspective, revenue for the first quarter totaled $39.4 million, just an increase of $7.5 million or 23.5% from the $31.9 million we achieved during the first quarter of fiscal 2010. As expected, our strong bookings during the third and fourth quarters and our pipeline that we talked about at our last call translated into significant revenue growth during the first quarter.
As you see in Slide 4 which is the sales detail by region and type, we were pleased to have achieved growth in almost all of our major channels, and I'll just address this quickly. Revenue in our government services group grew by $5.7 million in the first quarter, reflecting the previously announced government service contract that was awarded at the beginning of last year fourth quarter and other contracts won by that group. Significant in this contract was and is we also achieved significant growth during the quarter in other key channels. In fact six of our eight direct offices, both domestic and international, grew revenues during the first quarter as did every field support practice, our international licensee partners and two of three of the national account practices.Revenues in our geographic direct offices in the U.S., there are four of them, excluding the government services region, grew $900,000 or 7% during the quarter, reflecting the delivery of the training related to the strong bookings achieved during the third and fourth quarters, and four of the five domestic offices grew revenues during the quarter. Revenues in our international direct offices also grew and actually grew 16% for the quarter, with the big news being that Japan has continued to gain momentum and generated actually 30% revenue growth during the first quarter. We also achieved growth in Australia. Our revenues in our U.K. office, however, declined 200,000 during the quarter; but based on bookings, we expect U.K. revenues to be back and be at least flat to LY, to the last year, during the second quarter. Read the rest of this transcript for free on seekingalpha.com