FTI sulting(FCN)2025-04-24 20:01Financial Data and Key Metrics Changes - First quarter 2025 revenues were 30.3 million or 3.3% compared to the first quarter of the previous year [49] - GAAP earnings per share (EPS) were 2.23 in the prior year quarter, while adjusted EPS was 2.23 in the prior year quarter [50] - Net income decreased to 80 million in the prior year quarter, primarily due to lower revenues and a special charge [51] - Adjusted EBITDA for the first quarter 2025 was 111.1 million, or 12% of revenues in the prior year quarter [53] Business Line Data and Key Metrics Changes - Corporate Finance and Restructuring: Revenues decreased by 6.1% to 55.9 million or 16.3% of segment revenues [56] - Forensic and Litigation Consulting (FLC): Achieved record revenues of 37.5 million or 19.7% of segment revenues [59] - Economic Consulting: Revenues decreased by 12.1% to 14.4 million or 8% of segment revenues [62] - Technology: Revenues decreased by 3.5% to 11.6 million or 11.9% of segment revenues [64] - Strategic Communications: Revenues increased by 7.2% to 12.9 million or 14.8% of segment revenues [67] Market Data and Key Metrics Changes - The restructuring market is currently not particularly strong, impacting the Corporate Finance and Restructuring segment [21] - The M&A market has seen a decline, with U.S. deal volume falling 13% year over year [75] - The federal premerger notification program recorded the lowest monthly filing total in nearly five years, with only 89 transactions in March 2025 [66] Company Strategy and Development Direction - The company is focused on enhancing its visibility and expertise in various sectors, particularly in forensic and litigation consulting, which has shown strong performance [12][18] - There is a commitment to investing in talent acquisition, particularly in areas like antitrust, financial economics, and digital assets, despite the near-term financial impact [78] - The company is cautious about the potential impacts of regulatory changes on its business, particularly in areas like anti-consumer fraud and anti-money laundering [90] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the medium to long-term trajectory of the business despite current uncertainties in the market [42][43] - The company anticipates potential headwinds in 2025, particularly in the Economic Consulting segment due to recent departures and market conditions [30][34] - Management highlighted the importance of adapting to macroeconomic factors and maintaining a focus on client needs amidst regulatory changes [25][41] Other Important Information - The company funded 400 million for share repurchases, with approximately $568.3 million remaining available under the program [71] Q&A Session Summary Question: Impact of tariffs on business - Management noted that tariffs could have both positive and negative impacts across various segments, particularly in restructuring and supply chain consulting [83][86] Question: Effect of regulatory changes on forensic and litigation consulting - Management indicated that while there has not been a significant effect yet, potential regulatory rollbacks could impact the business in the future [89][90] Question: Guidance for the year - Management confirmed that the guidance provided at the fourth quarter 2024 earnings call remains applicable and will be updated at the second quarter earnings call [93][94] Question: Revenue headwinds from departures in Economic Consulting - Management acknowledged that the financial impact from departures is expected to be significant, with a potential increase in the estimated revenue headwind [102] Question: Trends in healthcare business within FLC - Management reported positive performance in healthcare practices, with good business activity compared to the previous year [112][113] Question: Distribution of headcount actions - Management provided details on headcount actions, indicating a balanced distribution across segments and geographies, with a slight emphasis on senior roles [119]