Cra International, Inc. (CRAI) Trims FY15 Outlook

Charles River Associates (Nasdaq: CRAI) announced updated financial guidance for its fiscal year ended January 2, 2016.

Based on preliminary unaudited financial data and subject to the final closing of the Company’s books, for the full 2015 fiscal year, CRA expects non-GAAP revenue in the range of $305 million to $307 million and non-GAAP Adjusted EBITDA margin between 15.6% and 16.0%, each as determined on a constant currency basis relative to fiscal 2014. This non-GAAP revenue and Adjusted EBITDA margin, if determined without the constant currency assumption, would be lower by approximately $6.3 million and 15 basis points, respectively. This updated guidance compares with CRA’s previous full-year fiscal 2015 guidance of non-GAAP revenue in the range of $312 million to $320 million and non-GAAP Adjusted EBITDA margin between 16.3% to 16.7%, each as determined on a constant currency basis relative to fiscal 2014.

*** The Street sees FY15 revenue of $306.7 million and EPS of $1.40.

“The integration of nearly 100 new consultants who arrived during the second half of the year – against a year-end headcount of 511 – was the primary contributor to lower than expected companywide utilization of 68% for the fourth quarter of fiscal 2015,” said Paul Maleh, CRA’s President and Chief Executive Officer. “Our integration efforts continue, and we are seeing improved productivity from our new colleagues. For example, individuals who joined CRA since July have improved their utilization from approximately 40% in the month of August to 65% in the month of December. We look for this trend to continue as we seek to return to target levels of companywide utilization in the low-to-mid 70s.”

“Assisting the productivity improvements of our new colleagues is the continued growth in project lead flow and new project originations,” Maleh continued. “For fiscal 2015, average weekly project lead flow and new project originations each increased compared with fiscal 2014 by approximately 4%. More recent metrics indicate greater strength, with project lead flow and new project originations for the second half of 2015 growing approximately 6% and 7%, respectively, compared with the second half of fiscal 2014. While the timing and size of these new projects cannot be determined in advance, CRA’s business fundamentals and strategy position the firm for growth.”

Fourth-Quarter and Fiscal 2015 Results Conference Call to be Webcast on February 18, 2016

CRA’s preliminary and unaudited financial data reported in this news release are estimates and remain subject to the final closing of the Company’s books. The Company expects to report its full financial results for the fourth quarter and fiscal year ended January 2, 2016 on February 18, 2016.

In conjunction with releasing its financial results, CRA plans to webcast a conference call at 10:00 a.m. ET that day. To listen to the live call, please visit the “Investor Relations” section of CRA’s website at http://www.crai.com, or dial (877) 709-8155 or (201) 689-8881. An archived version of the webcast will be available on CRA’s website for one year.

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