Huron Consulting Group Announces Third Quarter 2016 Financial Results

Huron Consulting Group Inc. (NASDAQ: HURN), a leading provider of business consulting services, today announced financial results from continuing operations for the third quarter ended September 30, 2016.

"Our Education and Life Sciences and Business Advisory segments continued to perform well in the third quarter, while our Healthcare segment remained challenged, reflecting the cautious approach that many healthcare providers are taking as they contemplate their approach to change amidst ongoing transformation in the industry," said James H. Roth, chief executive officer and president, Huron Consulting Group. "Looking ahead, we continue to focus on expanding the array of services that we offer to our industry-focused and commercial clients in order to position Huron for growth in an environment of uncertainty within our core markets."

Third Quarter 2016 Results from Continuing Operations

Revenues for the third quarter of 2016 increased 4.5% to $183.4 million from $175.5 million for the third quarter of 2015. Third quarter 2016 revenues included $17.1 million from the acquisitions of Cloud62, Inc., My Rounding Solutions, LLC, ADI Strategies, Inc., and Healthcare Services Management, Inc., all of which were completed subsequent to the third quarter of 2015. Net income from continuing operations was $12.3 million, or $0.57 per diluted share, for the third quarter of 2016 compared to $14.3 million, or $0.63 per diluted share, for the same period last year.

Third quarter 2016 earnings before interest, taxes, depreciation and amortization ("EBITDA") (6) was $35.4 million, or 19.3% of revenues, compared to $41.3 million, or 23.6% of revenues, in the comparable quarter last year.

In addition to using EBITDA to evaluate the Company's financial performance, management uses other non-GAAP financial measures, which exclude the effect of the following items (in thousands):
       
Three Months Ended September 30,
2016   2015
Amortization of intangible assets $ 8,771 $ 7,913
Restructuring charges $ 1,049 $ 320
Other losses $ 494 $
Non-cash interest on convertible notes $ 1,883 $ 1,795
Tax effect $ (4,794 ) $ (3,951 )
 

Adjusted EBITDA (6) was $36.9 million, or 20.1% of revenues, in the third quarter of 2016, compared to $41.7 million, or 23.7% of revenues, in the comparable quarter last year. Adjusted net income from continuing operations (6) was $19.7 million, or $0.92 per diluted share, for the third quarter of 2016, compared to $20.4 million, or $0.90 per diluted share, for the comparable period in 2015.

The average number of full-time billable consultants (1) increased 10.0% to 1,961 in the third quarter of 2016 compared to 1,783 in the same quarter last year. Full-time billable consultant utilization rate (2) was 73.9% during the third quarter of 2016 compared to 79.4% during the same period last year. Average billing rate per hour for full-time billable consultants (3) was $207 for the third quarter of 2016 compared to $209 for the third quarter of 2015. The average number of full-time equivalent professionals (5) was 269 in the third quarter of 2016 compared to 255 for the comparable period in 2015.

Year-to-Date 2016 Results from Continuing Operations

Revenues for the first nine months of 2016 increased 6.7% to $548.1 million from $513.9 million for the first nine months of 2015. Revenues for the first nine months of 2016 included $28.1 million of revenues from the acquisitions of Cloud62, Inc., My Rounding Solutions, LLC, ADI Strategies, Inc., and Healthcare Services Management, Inc., all of which were completed subsequent to the third quarter of 2015, and $11.2 million of incremental revenues due to the full period impact of the acquisitions of Studer Holdings, Inc., which was completed mid-first quarter 2015, and Rittman Mead Consulting Private Limited, which was completed at the start of the third quarter of 2015. Net income from continuing operations increased 20.1% to $35.3 million, or $1.65 per diluted share, for the first nine months of 2016 compared to $29.4 million, or $1.30 per diluted share, for the same period last year.

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