Note: EPS may not be comparable

Charles River Associates (NASDAQ: CRAI) reported Q4 EPS of $0.70, versus $0.37 reported last year. Revenue for the quarter came in at $97 million versus the consensus estimate of $89.6 million.

Key Fourth-Quarter Fiscal 2017 Highlights

• Revenue grew 22% year over year to $97.0 million, driven by an increase in companywide utilization to 75% compared with 71% in the fourth quarter of fiscal 2016 and quarter-end headcount growth of 17%.
• GAAP net loss was $2.3 million, or 2.3% of revenue, or a loss of $0.28 per diluted share for a decrease of 210% year over year. Excluding the effects of valuation changes to contingent consideration liabilities, consideration paid in connection with the IQVIA transaction and the estimated impact of the Tax Cuts and Jobs Act (“Tax Act”), non-GAAP net income increased 183% year over year to $5.9 million, or 6.1% of non-GAAP revenue, or $0.70 per diluted share.
• Non-GAAP Adjusted EBITDA grew 23% year over year to $15.8 million, or 16.3% of non-GAAP revenue.

Outlook and Financial Guidance

“In 2018, we look to build on our trend of broad-based, profitable growth. For full-year fiscal 2018, on a constant currency basis relative to fiscal 2017, CRA expects revenue in the range of $380 million to $392 million and non-GAAP EBITDA margin in the range of 8.8% to 9.8%. Given the change to our guidance profit metric from non-GAAP Adjusted EBITDA margin to non-GAAP EBITDA margin, for reference purposes, our non-GAAP EBITDA margins in fiscal years 2015, 2016 and 2017 were 8.1%, 8.4% and 9.0%, respectively. While we are pleased with CRA’s strong performance in 2017, we remain mindful that short-term challenges arising from the integration of new colleagues and uncertainties around global economic and political conditions can affect our business,” Maleh concluded.

CRA does not provide reconciliations of its annual non-GAAP EBITDA margin guidance to net income because CRA is unable to estimate with reasonable certainty the revaluation of contingent consideration liabilities, unusual gains or charges, foreign currency exchange rates, and the resulting effect of these items on CRA’s taxes without unreasonable effort. These items are uncertain, depend on various factors, and may have a material effect on CRA’s results computed in accordance with GAAP. A reconciliation between the historical GAAP and non-GAAP financial measures presented in this release is provided in the financial tables at the end of this release.

GUIDANCE:

Charles River Associates sees FY2018 revenue of $380-392 million, versus the consensus of $380.38 million.

For earnings history and earnings-related data on Charles River Associates (CRAI) click here.