0001053706-24-000012.txt : 20240502 0001053706-24-000012.hdr.sgml : 20240502 20240502081028 ACCESSION NUMBER: 0001053706-24-000012 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 17 CONFORMED PERIOD OF REPORT: 20240502 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20240502 DATE AS OF CHANGE: 20240502 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CRA INTERNATIONAL, INC. CENTRAL INDEX KEY: 0001053706 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-LEGAL SERVICES [8111] ORGANIZATION NAME: 07 Trade & Services IRS NUMBER: 042372210 STATE OF INCORPORATION: MA FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-24049 FILM NUMBER: 24905440 BUSINESS ADDRESS: STREET 1: 200 CLARENDON STREET STREET 2: T-9 CITY: BOSTON STATE: MA ZIP: 02116 BUSINESS PHONE: 6174253000 MAIL ADDRESS: STREET 1: 200 CLARENDON STREET STREET 2: T-9 CITY: BOSTON STATE: MA ZIP: 02116 FORMER COMPANY: FORMER CONFORMED NAME: CHARLES RIVER ASSOCIATES INC DATE OF NAME CHANGE: 19980126 8-K 1 crai-20240502.htm 8-K crai-20240502
0001053706FALSE00010537062024-05-022024-05-02

UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549 
 
FORM 8-K
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
Date of report (Date of earliest event reported): May 2, 2024

 
CRA INTERNATIONAL, INC.
 (Exact name of registrant as specified in its charter)
Massachusetts000-2404904-2372210
(State or other jurisdiction
of incorporation)
(Commission
 file number)
(IRS employer
identification no.)
200 Clarendon Street,Boston,Massachusetts02116
(Address of principal executive offices)(Zip code)
Registrant's telephone number, including area code:(617) 425-3000

 
(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, no par valueCRAINasdaq Global Select Market
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐




Item 2.02 Results of Operations and Financial Condition
On May 2, 2024, we issued a press release reporting our financial results for our fiscal quarter ended March 30, 2024. A copy of the press release is set forth as Exhibit 99.1 and is incorporated by reference herein. On May 2, 2024, we also posted on our website supplemental financial information, including prepared CFO remarks. A copy of the supplemental financial information is set forth as Exhibit 99.2 and incorporated by reference herein.
The information contained in Item 2.02 of this report and Exhibits 99.1 and 99.2 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such a filing.
Item 7.01 Regulation FD Disclosure
On May 2, 2024, we announced that our board of directors declared a quarterly cash dividend on our common stock of $0.42 per share to be paid on June 14, 2024 to all shareholders of record as of May 28, 2024. A copy of the press release is set forth as Exhibit 99.3 and is incorporated by reference herein.
The information contained in Item 7.01 of this report and Exhibit 99.3 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Number Title
   
 
   
 
   
 
   
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
2


SIGNATURES 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CRA INTERNATIONAL, INC.
   
   
Dated: May 2, 2024
By:/s/ DANIEL K. MAHONEY
  Daniel K. Mahoney
  Chief Financial Officer, Executive Vice President and Treasurer

3
EX-99.1 2 craiq1-20248xkexx991xpress.htm EX-99.1 Document

Exhibit 99.1
Contacts:
Dan MahoneyNicholas Manganaro
Chief Financial OfficerSharon Merrill Associates, Inc.
Charles River Associates crai@investorrelations.com
617-425-3505617-542-5300

CHARLES RIVER ASSOCIATES (CRA) REPORTS
FINANCIAL RESULTS FOR THE FIRST QUARTER OF 2024
Broad-based Contributions Drive Record Quarterly Revenue and Profits

BOSTON, May 2, 2024 – Charles River Associates (NASDAQ: CRAI), a worldwide leader in providing economic, financial and management consulting services, today announced financial results for the fiscal first quarter ended March 30, 2024.
“Building on momentum observed at the end of last year, CRA delivered record financial results during the first quarter of fiscal 2024,” said Paul Maleh, CRA’s President and Chief Executive Officer. “Revenue increased by 12.4% to $171.8 million, which represents the highest quarterly revenue in the company’s history. Profits grew at even faster rates, with new quarterly records set for each of net income, earnings per diluted share and EBITDA. Moreover, eight of eleven practices grew year over year to drive our strong financial performance, with six practices posting double-digit revenue growth—Antitrust & Competition Economics, Energy, Financial Economics, Forensic Services, Labor & Employment, and Risk, Investigations & Analytics.”

Highlights for First Quarter Fiscal 2024
Revenue grew 12.4% year over year to $171.8 million.
Utilization was 73%, and quarter-end headcount increased 2.6% year over year.
Net income increased 53.5% year over year to $13.7 million, or 8.0% of revenue, compared with $8.9 million, or 5.8% of revenue, in the first quarter of fiscal 2023; non-GAAP net income increased 47.6% year over year to $13.8 million, or 8.0% of revenue, compared with $9.4 million, or 6.1% of revenue, in the first quarter of fiscal 2023.
Earnings per diluted share increased 58.5% year over year to $1.95 from $1.23 in the first quarter of fiscal 2023; non-GAAP earnings per diluted share increased 51.9% year over year to $1.96 from $1.29 in the first quarter of fiscal 2023.
Non-GAAP EBITDA increased 34.4% to $22.4 million, or 13.0% of revenue, compared with $16.7 million, or 10.9% of revenue, in the first quarter of fiscal 2023.
On a constant currency basis relative to the first quarter of fiscal 2023, revenue, GAAP net income and earnings per diluted share would have been lower by $1.0 million, $0.1 million, and $0.01 per diluted share, respectively. Non-GAAP net income, earnings per diluted share, and non-GAAP EBITDA would have been lower by $0.1 million, $0.01 per diluted share and $0.1 million, respectively.
CRA returned $12.3 million of capital to its shareholders, consisting of $3.1 million of dividend payments and $9.2 million for share repurchases of approximately 66,000 shares.

Management Commentary and Financial Guidance
“We are reaffirming our financial guidance for full-year fiscal 2024 of revenue in the range of $645 million to $675 million and non-    GAAP EBITDA margin in the range of 10.8% to 11.5%, both on a constant currency basis relative to fiscal 2023,” said Maleh. “We are obviously pleased with the strong financial results to start the year, and are trending toward the top halves of our revenue and profit guidance ranges. We remain mindful that uncertain global macroeconomic, business, and political conditions can affect our business and will wait for another quarter of performance before providing any updated thoughts on our full-year guidance.”

CRA does not provide reconciliations of its annual non-GAAP EBITDA margin guidance to GAAP net income margin because the Company is unable to estimate with reasonable certainty unusual gains or charges, foreign currency exchange rates, and the resulting effect of these items, and of equity awards, 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.
1


Quarterly Dividend
On May 2, 2024, CRA announced a quarterly cash dividend of $0.42 per common share, payable on June 14, 2024 to shareholders of record as of May 28, 2024. CRA expects to continue paying quarterly dividends, the declaration, timing and amounts of which remain subject to the discretion of CRA’s Board of Directors.
Conference Call Information and Prepared CFO Remarks
CRA will host a conference call today at 10:00 a.m. ET to discuss its first-quarter 2024 financial results. 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.
In combination with this press release, CRA has posted prepared remarks by its CFO, Dan Mahoney, under “Quarterly Earnings” in the “Investor Relations” section on CRA’s website at http://www.crai.com. These remarks are offered to provide the investment community with additional background on CRA’s financial results prior to the start of the conference call.
About Charles River Associates (CRA)
Charles River Associates® is a leading global consulting firm specializing in economic, financial, and management consulting services. CRA advises clients on economic and financial matters pertaining to litigation and regulatory proceedings, and guides corporations through critical business strategy and performance-related issues. Since 1965, clients have engaged CRA for its unique combination of functional expertise and industry knowledge, and for its objective solutions to complex problems. Headquartered in Boston, CRA has offices throughout the world. Detailed information about Charles River Associates, a registered trade name of CRA International, Inc., is available at www.crai.com. Follow us on LinkedIn, Instagram, and Facebook.
NON-GAAP FINANCIAL MEASURES
In this release, CRA has supplemented the presentation of its financial results calculated in accordance with U.S. generally accepted accounting principles or “GAAP” with the following financial measures that are not calculated in accordance with GAAP: non‑GAAP net income, non‑GAAP earnings per diluted share and non‑GAAP EBITDA. CRA believes that the non-GAAP financial measures described in this press release are important to management and investors because these measures supplement the understanding of CRA’s ongoing operating results and financial condition. In addition, these non-GAAP measures are used by CRA in its budgeting process, and the non-GAAP adjustments are made to the performance measures for some of CRA’s performance-based compensation.
As used herein, CRA defines non-GAAP EBITDA as net income before interest expense (net), provision for income taxes, and depreciation and amortization further adjusted for the impact of certain items that we do not consider indicative of our core operating performance, such as non-cash amounts relating to valuation changes in contingent consideration, acquisition-related costs, foreign currency losses, net and related tax effects. Non-GAAP net income and non-GAAP earnings per diluted share also exclude non-cash amounts relating to valuation changes in contingent consideration, acquisition-related costs, foreign currency losses, net and related tax effects. This release also presents certain current fiscal period financial measures on a “constant currency” basis in order to isolate the effect that foreign currency exchange rate fluctuations can have on CRA’s financial results. These constant currency measures are determined by recalculating the current fiscal period local currency financial measure using the specified corresponding prior fiscal period’s foreign exchange rates.

All of the non-GAAP financial measures referred to above should be considered in conjunction with, and not as a substitute for, the GAAP financial information presented in this release. EBITDA and the financial measures identified in this release as “non-GAAP” are reconciled to their GAAP comparable measures in the financial tables appended to the end of this press release. In evaluating these non-GAAP financial measures, note that the non-GAAP financial measures used by CRA may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.







2


SAFE HARBOR STATEMENT
Statements in this press release concerning our future business, operating results and financial condition, including those concerning guidance on future revenue and non-GAAP EBITDA margin, the impact of exchange rate fluctuations on our financial results, our expectations regarding continued growth, our expectations regarding the payment of any future quarterly dividends and the level and extent of any purchases under our expanded share repurchase program, and statements using the terms “outlook,” “expect,” or similar expressions, are “forward-looking” statements as defined in Section 21 of the Exchange Act. These statements are based upon our current expectations and various underlying assumptions. Although we believe there is a reasonable basis for these statements and assumptions, and these statements are expressed in good faith, these statements are subject to a number of additional factors and uncertainties. Our actual revenue and non-GAAP EBITDA margin in fiscal 2024 on a constant currency basis relative to fiscal 2023 could differ materially from the guidance presented herein, and our actual performance and results may differ materially from the performance and results contained in or implied by the forward-looking statements made herein, due to many important factors. These factors include, but are not limited to, the possibility that the demand for our services may decline as a result of changes in general and industry specific economic conditions; the timing of engagements for our services; the effects of competitive services and pricing; our ability to attract and retain key employee or non-employee experts; the inability to integrate and utilize existing consultants and personnel; the decline or reduction in project work or activity; global economic conditions including less stable political and economic environments; foreign currency exchange rate fluctuations; unanticipated expenses and liabilities; risks inherent in international operations; changes in tax law or accounting standards, rules, and regulations; our ability to collect on forgivable loans should any become due; and professional and other legal liability or settlements. Additional risks and uncertainties are discussed in our periodic filings with the Securities and Exchange Commission under the heading “Risk Factors.” The inclusion of such forward-looking information should not be regarded as our representation that the future events, plans, or expectations contemplated will be achieved. Except as may be required by law, we undertake no obligation to update any forward-looking statements after the date of this press release, and we do not intend to do so.


3


CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE FISCAL QUARTERS ENDED
MARCH 30, 2024 COMPARED TO APRIL 1, 2023
(IN THOUSANDS, EXCEPT PER SHARE DATA)

Fiscal Quarter Ended
March 30,
2024
 As a % of
Revenue
April 1,
2023
 As a % of
Revenue
Revenues$171,789 100.0 %$152,845 100.0 %
Costs of services (exclusive of depreciation and amortization)118,880 69.2 %107,837 70.6 %
Selling, general and administrative expenses30,499 17.8 %28,372 18.6 %
Depreciation and amortization2,792 1.6 %2,943 1.9 %
Income from operations19,618 11.4 %13,693 9.0 %
Interest expense, net(464)-0.3 %(571)-0.4 %
Foreign currency losses, net(142)-0.1 %(528)-0.3 %
Income before provision for income taxes19,012 11.1 %12,594 8.2 %
Provision for income taxes5,321 3.1 %3,676 2.4 %
Net income$13,691 8.0 %$8,918 5.8 %
Net income per share:
  Basic$1.97 $1.25 
  Diluted$1.95 $1.23 
Weighted average number of shares outstanding:
  Basic6,926 7,119 
  Diluted7,011 7,252 

4


CRA INTERNATIONAL, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
FOR THE FISCAL QUARTERS ENDED
MARCH 30, 2024 COMPARED TO APRIL 1, 2023
(IN THOUSANDS, EXCEPT PER SHARE DATA)

Fiscal Quarter Ended
March 30,
2024
As a % of
Revenue
April 1,
2023
As a % of
Revenue
Revenues$171,789 100.0 %$152,845 100.0 %
Net income$13,691 8.0 %$8,918 5.8 %
Adjustments needed to reconcile GAAP net income to non-GAAP net income:
Non-cash valuation change in contingent consideration — — %21 — %
Acquisition-related costs— — %22 — %
Foreign currency losses, net142 0.1 %528 0.3 %
Tax effect on adjustments(35)— %(139)-0.1 %
Non-GAAP net income$13,798 8.0 %$9,350 6.1 %
Non-GAAP net income per share:
Basic$1.99 $1.31 
Diluted$1.96 $1.29 
Weighted average number of shares outstanding:
Basic6,926 7,119 
Diluted7,011 7,252 
5


CRA INTERNATIONAL, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
FOR THE FISCAL QUARTERS ENDED
MARCH 30, 2024 COMPARED TO APRIL 1, 2023
(IN THOUSANDS)

Fiscal Quarter Ended
March 30,
2024
As a % of
 Revenue
April 1,
2023
As a % of
 Revenue
Revenues$171,789 100.0 %$152,845 100.0 %
Net income$13,691 8.0 %$8,918 5.8 %
Adjustments needed to reconcile GAAP net income to non-GAAP net income:
Non-cash valuation change in contingent consideration— — %21 — %
Acquisition-related costs— — %22 — %
Foreign currency losses, net142 0.1 %528 0.3 %
Tax effect on adjustments(35)— %(139)-0.1 %
Non-GAAP net income$13,798 8.0 %$9,350 6.1 %
Adjustments needed to reconcile non-GAAP net income to non-GAAP EBITDA:
Interest expense, net464 0.3 %571 0.4 %
Provision for income taxes5,356 3.1 %3,815 2.5 %
Depreciation and amortization2,792 1.6 %2,943 1.9 %
Non-GAAP EBITDA$22,410 13.0 %$16,679 10.9 %
6


CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

March 30,
2024
December 30,
2023
Assets
Cash and cash equivalents$37,122 $45,586 
Accounts receivable and unbilled services, net209,313 199,556 
Other current assets29,004 20,334 
Total current assets275,439 265,476 
Property and equipment, net36,833 38,176 
Goodwill and intangible assets, net100,704 101,185 
Right-of-use assets84,706 86,887 
Other assets54,860 61,487 
Total assets$552,542 $553,211 
Liabilities and Shareholders’ Equity
Accounts payable$33,350 $28,701 
Accrued expenses106,008 171,040 
Current portion of lease liabilities16,743 16,475 
Revolving line of credit70,000 — 
Other current liabilities10,670 19,871 
Total current liabilities236,771 236,087 
Non-current portion of lease liabilities88,961 92,280 
Other non-current liabilities15,020 12,743 
Total liabilities340,752 341,110 
Total shareholders’ equity211,790 212,101 
Total liabilities and shareholders’ equity$552,542 $553,211 

7


CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)


Fiscal Quarter Ended
March 30,
2024
April 1,
2023
Operating activities:
Net income$13,691 $8,918 
Adjustments to reconcile net income to net cash used in operating activities:
Non-cash items, net7,694 7,197 
Accounts receivable and unbilled services(11,094)(1,353)
Working capital items, net(73,371)(84,813)
Net cash used in operating activities(63,080)(70,051)
Investing activities:
Purchases of property and equipment, net(730)(562)
Consideration paid for acquisition, net— (570)
Net cash used in investing activities(730)(1,132)
Financing activities:
Borrowings under revolving line of credit70,000 105,000 
Repayments under revolving line of credit— (5,000)
Tax withholding payments reimbursed by shares(1,631)(1,873)
Cash dividends paid(3,075)(2,702)
Repurchase of common stock(9,242)(20,577)
Net cash provided by financing activities56,052 74,848 
Effect of foreign exchange rates on cash and cash equivalents(706)407 
Net increase (decrease) in cash and cash equivalents(8,464)4,072 
Cash and cash equivalents at beginning of period45,586 31,447 
Cash and cash equivalents at end of period$37,122 $35,519 
Noncash investing and financing activities:
Increase in accounts payable and accrued expenses for property and equipment$454 $23 
Excise tax on share repurchases$(65)$(173)
Right-of-use assets obtained in exchange for lease obligations$1,955 $— 
Supplemental cash flow information:
Cash paid for taxes$1,534 $1,081 
Cash paid for interest$91 $124 
Cash paid for amounts included in operating lease liabilities$5,569 $5,474 
8
EX-99.2 3 craiq1-20248xkexx992xcfore.htm EX-99.2 Document

Exhibit 99.2
cralogoa.jpg

CHARLES RIVER ASSOCIATES (CRA)
FIRST QUARTER FISCAL YEAR 2024
EARNINGS ANNOUNCEMENT
PREPARED CFO REMARKS
CRA is providing these prepared remarks by CFO Dan Mahoney in combination with its press release. These remarks are offered to provide the investment community with additional information on CRA’s financial results prior to the start of the conference call.
As previously announced, the conference call will be held May 2, 2024 at 10:00 a.m. ET. These prepared remarks will not be read on the call.
Q1 Fiscal 2024 Summary (Quarter ended March 30, 2024)
Revenue: $171.8 million
Net income: $13.7 million, or 8.0% of revenue; non-GAAP net income: $13.8 million, or 8.0% of revenue
Net income per diluted share: $1.95; non-GAAP net income per diluted share: $1.96
Operating margin and non-GAAP operating margin: 11.4%
Non-GAAP EBITDA: $22.4 million, or 13.0% of revenue
Effective tax rate and non-GAAP effective tax rate: 28.0%
Utilization: 73%
Consultant headcount at the end of Q1 of fiscal 2024: 997, which consists of 158 officers, 544 other senior staff and 295 junior staff
Cash and cash equivalents: $37.1 million at March 30, 2024
Revolving credit facility borrowing capacity: $175.5 million at March 30, 2024

Revenue
For Q1 of fiscal 2024, revenue was $171.8 million, compared with revenue of $152.8 million for Q1 of fiscal 2023.
Headcount
The following table outlines CRA’s consultant headcount at the end of the stated quarters:
Q1
2024
Q4
2023
Q3
2023
Q2
2023
Q1
2023
Officers158156155156158
Other Senior Staff544527529522535
Junior Staff295321330293279
Total9971,0041,014971972
Utilization
For Q1 of fiscal 2024, companywide utilization was 73%, compared with 70% for Q1 of fiscal 2023.
Client Reimbursables
For Q1 of fiscal 2024, client reimbursables were $17.1 million, or 9.9% of revenue, compared with $14.0 million, or 9.1% of revenue, for Q1 of fiscal 2023.
1




Selling, General and Administrative (SG&A) Expenses
For Q1 of fiscal 2024, SG&A expenses were $30.5 million, or 17.8% of revenue, compared with $28.4 million, or 18.6% of revenue, for Q1 of fiscal 2023. Commissions to non-employee experts are included in SG&A expenses. These commissions represented approximately 2.1% of revenue for Q1 of fiscal 2024, compared with 2.3% in Q1 of fiscal 2023. Excluding these commissions, SG&A expenses were 15.6% of revenue for Q1 of fiscal 2024, compared with 16.2% in Q1 of fiscal 2023.
Fiscal Quarter Ended
$ in 000’sMarch 30,
2024
As a % of RevenueApril 1,
2023
As a % of Revenue
SG&A expenses$30,499 17.8 %$28,372 18.6 %
Less: commissions to non-employee experts3,671 2.1 %3,542 2.3 %
SG&A expenses excluding commissions$26,828 15.6 %$24,830 16.2 %
Depreciation & Amortization
For Q1 of fiscal 2024, depreciation and amortization expenses amounted to $2.8 million, or 1.6% of revenue, compared with $2.9 million, or 1.9% of revenue, for Q1 of fiscal 2023.
Forgivable Loan Amortization
For Q1 of fiscal 2024, forgivable loan amortization was $8.7 million, or 5.1% of revenue, compared with $9.5 million, or 6.2% of revenue, for Q1 of fiscal 2023.
Share-Based Compensation Expense
For Q1 of fiscal 2024, share-based compensation expense was approximately $1.0 million, or 0.6% of revenue, compared with $0.9 million, or 0.6% of revenue, for Q1 of fiscal 2023.
Operating Income
For Q1 of fiscal 2024, operating income was $19.6 million, or 11.4% of revenue, compared with operating income of $13.7 million, or 9.0% of revenue, for Q1 of fiscal 2023. Non-GAAP operating income was $19.6 million, or 11.4% of revenue, for Q1 of fiscal 2024, compared with $13.7 million, or 9.0% of revenue, for Q1 of fiscal 2023.
Fiscal Quarter Ended
$ in 000’sMarch 30,
2024
As a % of RevenueApril 1,
2023
As a % of Revenue
Income from operations$19,618 11.4 %$13,693 9.0 %
Adjustments needed to reconcile GAAP income from operations to non-GAAP income from operations:
Non-cash valuation change in contingent consideration— — %21 — %
Acquisition-related costs— — %22 — %
Non-GAAP income from operations$19,618 11.4 %$13,736 9.0 %
Interest Income (Expense), net
For Q1 of fiscal 2024, net interest expense was $0.5 million, or 0.3% of revenue, compared with net interest expense of $0.6 million, or 0.4% of revenue, for Q1 of fiscal 2023.
Foreign Currency Losses, net
For Q1 of fiscal 2024, net foreign currency losses were $0.1 million, or 0.1% of revenue, compared with net foreign currency losses of $0.5 million, or 0.3% of revenue, for Q1 of fiscal 2023.
Foreign currency losses, net, is comprised of net gains and losses on foreign denominated transactions and the revaluation of working capital balances.
Income Taxes
The following table outlines CRA’s income tax provision recorded and the resulting effective tax rates:
GAAPNon-GAAP
Fiscal Quarter EndedFiscal Quarter Ended
$ in 000’sMarch 30,
2024
April 1,
2023
March 30,
2024
April 1,
2023
Tax Provision$5,321 $3,676 $5,356 $3,815 
Effective Tax Rate28.0 %29.2 %28.0 %29.0 %
2



Fiscal Quarter Ended
$ in 000’sMarch 30,
2024
As a % of RevenueApril 1,
2023
As a % of Revenue
Income before provision for income taxes$19,012 11.1 %$12,594 8.2 %
Adjustments needed to reconcile GAAP income before provision for income taxes to non-GAAP income before provision for income taxes
Non-cash valuation change in contingent consideration— — %21 — %
Acquisition-related costs— — %22 — %
Foreign currency losses, net142 0.1 %528 0.3 %
Non-GAAP income before provision for income taxes$19,154 11.1 %$13,165 8.6 %
GAAP provision for income taxes$5,321 $3,676 
Tax effect on non-GAAP adjustments35 139 
Non-GAAP provision for income taxes$5,356 $3,815 
Net Income
For Q1 of fiscal 2024, net income was $13.7 million, or 8.0% of revenue, or $1.95 per diluted share, compared with net income of $8.9 million, or 5.8% of revenue, or $1.23 per diluted share, for Q1 of fiscal 2023. Non-GAAP net income for Q1 of fiscal 2024 was $13.8 million, or 8.0% of revenue, or $1.96 per diluted share, compared with $9.4 million, or 6.1% of revenue, or $1.29 per diluted share, for Q1 of fiscal 2023.
Non-GAAP EBITDA
For Q1 of fiscal 2024, non-GAAP EBITDA was $22.4 million, or 13.0% of revenue, compared with $16.7 million, or 10.9% of revenue, for Q1 of fiscal 2023.
Constant Currency Basis
For Q1 of fiscal 2024, revenue was $171.8 million, and net income was $13.7 million, or 8.0% of revenue, or $1.95 per diluted share. On a constant currency basis relative to Q1 of fiscal 2023, Q1 of fiscal 2024 revenue would have been lower by $1.0 million to $170.8 million, GAAP net income would have been lower by $0.1 million to $13.6 million, or 8.0% of revenue, and earnings per diluted share would have decreased by $0.01 to $1.94 per diluted share.
For Q1 of fiscal 2024, revenue was $171.8 million, and non-GAAP net income was $13.8 million, or 8.0% of revenue, or $1.96 per diluted share. On a constant currency basis relative to Q1 of fiscal 2023, Q1 of fiscal 2024 revenue would have been lower by $1.0 million to $170.8 million, non-GAAP net income would have been lower by $0.1 million to $13.7 million, or 8.0% of revenue, non-GAAP earnings per diluted share would have decreased by $0.01 to $1.95 per diluted share, and non-GAAP EBITDA would have been lower by $0.1 million to $22.3 million, or 13.1% of revenue.
A description of the process for calculating the measures presented on a constant currency basis is contained under the heading “Non-GAAP Financial Measures” below.
Key Balance Sheet Metrics
Billed and unbilled receivables at March 30, 2024 were $209.3 million, compared with $197.2 million at April 1, 2023. Current liabilities at March 30, 2024 were $236.8 million, compared with $253.8 million at April 1, 2023.
Total Days Sales Outstanding, or DSO, for Q1 of fiscal 2024 was 106 days, consisting of 69 days of billed and 37 days of unbilled. This compares with 112 days reported for Q1 of fiscal 2023, consisting of 70 days of billed and 42 days of unbilled.
Cash and Cash Flow
Cash and cash equivalents was $37.1 million at March 30, 2024, compared with $35.5 million at April 1, 2023.
Net cash used in operating activities for Q1 of fiscal 2024 was $63.1 million, compared with net cash used in operating activities of $70.1 million for Q1 of fiscal 2023.
As of March 30, 2024, outstanding borrowings under CRA’s revolving credit facility amounted to $70.0 million. At April 1, 2023, outstanding borrowings under CRA’s revolving credit facility amounted to $100.0 million.
Capital expenditures totaled $0.7 million for Q1 of fiscal 2024, compared with $0.6 million for Q1 of fiscal 2023.
CRA repurchased approximately 66,000 shares of common stock during Q1 of fiscal 2024 for $9.2 million, compared with Q1 of fiscal 2023, when approximately 181,000 shares of common stock were repurchased for $20.6 million.
3


A quarterly cash dividend of $0.42 per common share, for total dividends and dividend equivalents of $3.1 million, was paid in Q1 of fiscal 2024, compared with a quarterly cash dividend of $0.36 per common share, for total dividends and dividend equivalents of $2.7 million paid in Q1 of fiscal 2023.
GAAP Condensed Consolidated Statement of Cash Flows
CRA has derived the condensed consolidated statement of cash flow data for the years ended December 30, 2023 and December 31, 2022 from its audited financial statements appearing on Form 10-K for the fiscal year ended December 30, 2023, filed with the Securities and Exchange Commission on February 29, 2024. The condensed consolidated statement of cash flow data for the second and third quarters of fiscal year 2022 and the first, second, and third quarters of fiscal year 2023 have been derived from CRA’s unaudited financial statements appearing on Form 10-Q for each of the respective fiscal quarters as well as the consolidated statements of cash flows appearing on Form 10-K for the fiscal years ended December 30, 2023 and December 31, 2022 and have been prepared on the same basis as CRA’s audited financial statements.

GAAP Condensed Consolidated Statement of Cash FlowsLTMQ1Q4Q3Q2
($ in 000’s)Q1 20242024202320232023
Net cash provided by (used in) operating activities$67,043 $(63,080)$60,099 $64,952 $5,072 
Net cash used in investing activities(2,541)(730)(358)(733)(720)
Net cash provided by (used in) financing activities(63,278)56,052 (43,092)(50,574)(25,664)
Effect of foreign exchange rates on cash and cash equivalents379 (706)1,333 (312)64 
Net increase (decrease) in cash and cash equivalents$1,603 $(8,464)$17,982 $13,333 $(21,248)
Cash and cash equivalents at beginning of period35,519 45,586 27,604 14,271 35,519 
Cash and cash equivalents at end of period$37,122 $37,122 $45,586 $27,604 $14,271 
GAAP Condensed Consolidated Statement of Cash FlowsLTMQ1Q4Q3Q2
($ in 000’s)Q1 20232023202220222022
Net cash provided by (used in) operating activities$16,908 $(70,051)$60,136 $43,797 $(16,974)
Net cash used in investing activities(7,312)(1,132)(4,981)(932)(267)
Net cash provided by (used in) financing activities(16,215)74,848 (48,212)(32,840)(10,011)
Effect of foreign exchange rates on cash and cash equivalents(1,564)407 411 (1,553)(829)
Net increase (decrease) in cash and cash equivalents$(8,183)$4,072 $7,354 $8,472 $(28,081)
Cash and cash equivalents at beginning of period43,702 31,447 24,093 15,621 43,702 
Cash and cash equivalents at end of period$35,519 $35,519 $31,447 $24,093 $15,621 

Adjusted Net Cash Flows from Operations
Below are the quarterly and last twelve-month reconciliations of GAAP net cash provided by (used in) operating activities for each of the periods presented to non-GAAP adjusted net cash flows from operations. The reconciling items are forgivable loan advances and repayments for each period, which are reported as a component of GAAP net cash provided by (used in) operating activities, along with other non-recurring cash items.
Adjusted Net Cash Flows from OperationsLTMQ1Q4Q3Q2
($ in 000’s)Q1 20242024202320232023
GAAP net cash provided by (used in) operating activities$67,043 $(63,080)$60,099 $64,952 $5,072 
Forgivable loan advances11,750 5,250 2,000 3,750 750 
Forgivable loan repayments(1,200)— (1,200)— — 
Adjusted net cash flows from operations$77,593 $(57,830)$60,899 $68,702 $5,822 
Net revenue$642,920 $171,789 $161,613 $147,553 $161,965 
GAAP net cash provided by (used in) operating activities as a percentage of net revenue10.4 %(36.7)%37.2 %44.0 %3.1 %
Adjusted net cash flows from operations as a percentage of net revenue12.1 %(33.7)%37.7 %46.6 %3.6 %
4


Adjusted Net Cash Flows from OperationsLTMQ1Q4Q3Q2
($ in 000’s)Q1 20232023202220222022
GAAP net cash provided by (used in) operating activities$16,908 $(70,051)$60,136 $43,797 $(16,974)
Forgivable loan advances43,026 16,842 9,517 3,313 13,354 
Forgivable loan repayments(641)(616)— — (25)
Other non-recurring cash items (1)213 22 69 30 92 
Adjusted net cash flows from operations$59,506 $(53,803)$69,722 $47,140 $(3,553)
Net revenue$595,364 $152,845 $144,976 $148,441 $149,102 
GAAP net cash provided by (used in) operating activities as a percentage of net revenue2.8 %(45.8)%41.5 %29.5 %(11.4)%
Adjusted net cash flows from operations as a percentage of net revenue10.0 %(35.2)%48.1 %31.8 %(2.4)%
(1) Other non-recurring cash items includes acquisition-related costs.
NON-GAAP FINANCIAL MEASURES
In these remarks, CRA has supplemented the presentation of its financial results calculated in accordance with U.S. generally accepted accounting principles or “GAAP” with the following financial measures that were not calculated in accordance with GAAP: non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP EBITDA, non-GAAP income from operations (and non-GAAP operating margin), non-GAAP provision for income taxes (and non-GAAP effective tax rate), SG&A expenses excluding commissions and adjusted net cash flows from operations. CRA believes that these non-GAAP financial measures are important to management and investors because these measures supplement the understanding of CRA’s ongoing operating results, financial condition and cash flows. Non-GAAP adjusted net cash flows from operations is used by management to assess CRA’s ability to fund items such as the acquisition of talent, office expansions, debt repayment and distributions to shareholders. In addition, non-GAAP net income and non-GAAP EBITDA are used by CRA in its budgeting process, and the non-GAAP adjustments described below are made to the performance measures for some of CRA’s performance-based compensation.
As used herein, CRA defines non-GAAP EBITDA as net income before interest expense (net), provision for income taxes, and depreciation and amortization further adjusted for the impact of certain items that we do not consider indicative of its core operating performance, such as non-cash amounts relating to valuation changes in contingent consideration, acquisition-related costs, foreign currency losses, net and related tax effects. Non-GAAP net income, non-GAAP income from operations and non-GAAP provision for income taxes also exclude non-cash amounts relating to valuation changes in contingent consideration, acquisition-related costs, foreign currency losses, net and related tax effects. The adjustments made to non-GAAP adjusted net cash flows from operations add back forgivable loan issuances, net of repayments, along with other non-recurring cash items. These remarks also present certain current fiscal period financial measures on a “constant currency” basis in order to isolate the effect that foreign currency exchange rate fluctuations can have on CRA’s financial results. These constant currency measures are determined by recalculating the current fiscal period local currency financial measure using the specified corresponding prior fiscal period’s foreign exchange rates.

All of the non-GAAP financial measures referred to above should be considered in conjunction with, and not as a substitute for, the GAAP financial information presented in these remarks. EBITDA and the financial measures identified in these remarks as “non-GAAP” are reconciled to their GAAP comparable measures either in these remarks or in the attached financial tables. In evaluating these non-GAAP financial measures, note that the non-GAAP financial measures used by CRA may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.
5


CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE FISCAL QUARTERS ENDED
MARCH 30, 2024 COMPARED TO APRIL 1, 2023
(IN THOUSANDS, EXCEPT PER SHARE DATA)

Fiscal Quarter Ended
March 30,
2024
 As a % of
Revenue
April 1,
2023
 As a % of
Revenue
Revenues$171,789 100.0 %$152,845 100.0 %
Costs of services (exclusive of depreciation and amortization)118,880 69.2 %107,837 70.6 %
Selling, general and administrative expenses30,499 17.8 %28,372 18.6 %
Depreciation and amortization2,792 1.6 %2,943 1.9 %
Income from operations19,618 11.4 %13,693 9.0 %
Interest expense, net(464)-0.3 %(571)-0.4 %
Foreign currency losses, net(142)-0.1 %(528)-0.3 %
Income before provision for income taxes19,012 11.1 %12,594 8.2 %
Provision for income taxes5,321 3.1 %3,676 2.4 %
Net income$13,691 8.0 %$8,918 5.8 %
Net income per share:
  Basic$1.97 $1.25 
  Diluted$1.95 $1.23 
Weighted average number of shares outstanding:
  Basic6,926 7,119 
  Diluted7,011 7,252 
6


CRA INTERNATIONAL, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
FOR THE FISCAL QUARTERS ENDED
MARCH 30, 2024 COMPARED TO APRIL 1, 2023
(IN THOUSANDS, EXCEPT PER SHARE DATA)

Fiscal Quarter Ended
March 30,
2024
As a % of
Revenue
April 1,
2023
As a % of
Revenue
Revenues$171,789 100.0 %$152,845 100.0 %
Net income$13,691 8.0 %$8,918 5.8 %
Adjustments needed to reconcile GAAP net income to non-GAAP net income:
Non-cash valuation change in contingent consideration — — %21 — %
Acquisition-related costs— — %22 — %
Foreign currency losses, net142 0.1 %528 0.3 %
Tax effect on adjustments(35)— %(139)-0.1 %
Non-GAAP net income$13,798 8.0 %$9,350 6.1 %
Non-GAAP net income per share:
Basic$1.99 $1.31 
Diluted$1.96 $1.29 
Weighted average number of shares outstanding:
Basic6,926 7,119 
Diluted7,011 7,252 


7


CRA INTERNATIONAL, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
FOR THE FISCAL QUARTERS ENDED
MARCH 30, 2024 COMPARED TO APRIL 1, 2023
(IN THOUSANDS)

Fiscal Quarter Ended
March 30,
2024
As a % of
 Revenue
April 1,
2023
As a % of
 Revenue
Revenues$171,789 100.0 %$152,845 100.0 %
Net income$13,691 8.0 %$8,918 5.8 %
Adjustments needed to reconcile GAAP net income to non-GAAP net income:
Non-cash valuation change in contingent consideration— — %21 — %
Acquisition-related costs— — %22 — %
Foreign currency losses, net142 0.1 %528 0.3 %
Tax effect on adjustments(35)— %(139)-0.1 %
Non-GAAP net income$13,798 8.0 %$9,350 6.1 %
Adjustments needed to reconcile non-GAAP net income to non-GAAP EBITDA:
Interest expense, net464 0.3 %571 0.4 %
Provision for income taxes5,356 3.1 %3,815 2.5 %
Depreciation and amortization2,792 1.6 %2,943 1.9 %
Non-GAAP EBITDA$22,410 13.0 %$16,679 10.9 %
8


CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

March 30,
2024
December 30,
2023
Assets
Cash and cash equivalents$37,122 $45,586 
Accounts receivable and unbilled services, net209,313 199,556 
Other current assets29,004 20,334 
Total current assets275,439 265,476 
Property and equipment, net36,833 38,176 
Goodwill and intangible assets, net100,704 101,185 
Right-of-use assets84,706 86,887 
Other assets54,860 61,487 
Total assets$552,542 $553,211 
Liabilities and Shareholders’ Equity
Accounts payable$33,350 $28,701 
Accrued expenses106,008 171,040 
Current portion of lease liabilities16,743 16,475 
Revolving line of credit70,000 — 
Other current liabilities10,670 19,871 
Total current liabilities236,771 236,087 
Non-current portion of lease liabilities88,961 92,280 
Other non-current liabilities15,020 12,743 
Total liabilities340,752 341,110 
Total shareholders’ equity211,790 212,101 
Total liabilities and shareholders’ equity$552,542 $553,211 
9


CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

Fiscal Quarter Ended
March 30,
2024
April 1,
2023
Operating activities:
Net income$13,691 $8,918 
Adjustments to reconcile net income to net cash used in operating activities:
Non-cash items, net7,694 7,197 
Accounts receivable and unbilled services(11,094)(1,353)
Working capital items, net(73,371)(84,813)
Net cash used in operating activities(63,080)(70,051)
Investing activities:
Purchases of property and equipment, net(730)(562)
Consideration paid for acquisition, net— (570)
Net cash used in investing activities(730)(1,132)
Financing activities:
Borrowings under revolving line of credit70,000 105,000 
Repayments under revolving line of credit— (5,000)
Tax withholding payments reimbursed by shares(1,631)(1,873)
Cash dividends paid(3,075)(2,702)
Repurchase of common stock(9,242)(20,577)
Net cash provided by financing activities56,052 74,848 
Effect of foreign exchange rates on cash and cash equivalents(706)407 
Net increase (decrease) in cash and cash equivalents(8,464)4,072 
Cash and cash equivalents at beginning of period45,586 31,447 
Cash and cash equivalents at end of period$37,122 $35,519 
Noncash investing and financing activities:
Increase in accounts payable and accrued expenses for property and equipment$454 $23 
Excise tax on share repurchases$(65)$(173)
Right-of-use assets obtained in exchange for lease obligations$1,955 $— 
Supplemental cash flow information:
Cash paid for taxes$1,534 $1,081 
Cash paid for interest$91 $124 
Cash paid for amounts included in operating lease liabilities$5,569 $5,474 
10
EX-99.3 4 craiq1-20248xkexx993xdivid.htm EX-99.3 Document

Exhibit 99.3
Contacts:
Dan MahoneyNicholas Manganaro
Chief Financial OfficerSharon Merrill Associates, Inc.
Charles River Associatescrai@investorrelations.com
617-425-3505617-542-5300

CHARLES RIVER ASSOCIATES (CRA) DECLARES QUARTERLY CASH DIVIDEND OF $0.42 PER COMMON SHARE

BOSTON, May 2, 2024 – Charles River Associates (NASDAQ: CRAI), a worldwide leader in providing economic, financial and management consulting services, today announced that its Board of Directors has declared a quarterly cash dividend of $0.42 per common share to be paid on June 14, 2024 to shareholders of record of CRA’s common stock as of the close of business on May 28, 2024. The Company expects to continue paying quarterly dividends, the declaration, timing and amounts of which remain subject to the discretion of CRA’s Board of Directors.

About Charles River Associates (CRA)
Charles River Associates® is a leading global consulting firm specializing in economic, financial and management consulting services. CRA advises clients on economic and financial matters pertaining to litigation and regulatory proceedings, and guides corporations through critical business strategy and performance-related issues. Since 1965, clients have engaged CRA for its unique combination of functional expertise and industry knowledge, and for its objective solutions to complex problems. Headquartered in Boston, CRA has offices throughout the world. Detailed information about Charles River Associates, a registered trade name of CRA International, Inc., is available at www.crai.com. Follow us on LinkedIn, Instagram, and Facebook.

SAFE HARBOR STATEMENT
Statements in this press release concerning our expectations regarding the payment of future quarterly dividends are “forward-looking” statements as defined in Section 21 of the Exchange Act. These statements are based upon our current expectations and various underlying assumptions. Although we believe there is a reasonable basis for these statements and assumptions, and these statements are expressed in good faith, these statements are subject to a number of additional factors and uncertainties. These factors include, but are not limited to, the possibility that the demand for our services may decline as a result of changes in general and industry specific economic conditions; the timing of engagements for our services; the effects of competitive services and pricing; our ability to attract and retain key employee or non-employee experts; the inability to integrate and utilize existing consultants and personnel; the decline or reduction in project work or activity; global economic conditions including less stable political and economic environments; foreign currency exchange rate fluctuations; unanticipated expenses and liabilities; risks inherent in international operations; changes in tax law or accounting standards, rules, and regulations; our ability to collect on forgivable loans should any become due; and professional and other legal liability or settlements. Additional risks and uncertainties are discussed in our periodic filings with the Securities and Exchange Commission under the heading “Risk Factors.” The inclusion of such forward-looking information should not be regarded as our representation that the future events, plans, or expectations contemplated will be achieved. Except as may be required by law, we undertake no obligation to update any forward-looking statements after the date of this press release, and we do not intend to do so.


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Cover
May 02, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date May 02, 2024
Entity Registrant Name CRA INTERNATIONAL, INC.
Entity Incorporation, State or Country Code MA
Entity File Number 000-24049
Entity Tax Identification Number 04-2372210
Entity Address, Address Line One 200 Clarendon Street,
Entity Address, City or Town Boston,
Entity Address, State or Province MA
Entity Address, Postal Zip Code 02116
City Area Code (617)
Local Phone Number 425-3000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, no par value
Trading Symbol CRAI
Security Exchange Name NASDAQ
Entity Central Index Key 0001053706
Amendment Flag false
Entity Emerging Growth Company false
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