Item 7.01.
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Regulation FD Disclosure.
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FTI Consulting, Inc. (FTI Consulting) uses a
presentation from time to time in its discussions with investors (the Presentation). The Presentation includes FTI Consultings past and present financial results, operating data and other information. A copy of the Presentation is
furnished as Exhibit 99.1 and has been posted to the FTI Consulting website at www.fticonsulting.com.
The Presentation includes
information regarding Segment Operating Income, Total Segment Operating Income, Adjusted EBITDA, Adjusted Segment EBITDA, Total Adjusted Segment EBITDA, Adjusted EBITDA Margin, Adjusted Segment EBITDA Margin, Adjusted Net Income and adjusted
earnings per diluted share (Adjusted EPS).
FTI Consulting has included the definitions of Segment Operating Income
(Loss) and Adjusted Segment EBITDA, which are financial measures presented in accordance with U.S. generally accepted accounting principles (GAAP), in order to more fully define the components of certain financial
measures not presented in accordance with GAAP
(Non-GAAP).
FTI Consulting evaluates the performance of its operating segments based on Adjusted Segment EBITDA, and Segment Operating Income (Loss)
is a component of the definition of Adjusted Segment EBITDA.
FTI Consulting defines Segment Operating Income (Loss) as a
segments share of consolidated operating income (loss). FTI Consulting defines Total Segment Operating Income (Loss), which is a
Non-GAAP
financial measure, as the total of Segment Operating
Income (Loss) for all segments, which excludes unallocated corporate expenses. FTI Consulting uses Segment Operating Income (Loss) for the purpose of calculating Adjusted Segment EBITDA. FTI Consulting defines Adjusted Segment EBITDA as
a segments share of consolidated operating income (loss) before depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges. FTI Consulting
uses Adjusted Segment EBITDA as a basis to internally evaluate the financial performance of its segments because FTI Consulting believes it reflects current core operating performance and provides an indicator of the segments ability to
generate cash. FTI Consulting defines Adjusted Segment EBITDA Margin as Adjusted Segment EBITDA as a percentage of a segments revenues.
FTI Consulting defines Total Adjusted Segment EBITDA, which is a
Non-GAAP
financial
measure, as the total of Adjusted Segment EBITDA for all segments, which excludes unallocated corporate expenses. FTI Consulting defines Adjusted EBITDA, which is a
Non-GAAP
financial measure, as
consolidated net income before income tax provision, other
non-operating
income (expense), depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration,
special charges, goodwill impairment charges and losses on early extinguishment of debt. FTI Consulting believes that the
Non-GAAP
financial measures, which exclude the effects of remeasurement of
acquisition-related contingent consideration, special charges and goodwill impairment charges, when considered together with its GAAP financial results and GAAP financial measures, provide management and investors with a more complete understanding
of FTI Consultings operating results, including underlying trends. In addition, EBITDA is a common alternative measure of operating performance used by many of FTI Consultings competitors. It is used by investors, financial analysts,
rating agencies
2
and others to value and compare the financial performance of companies in FTI Consultings industry. Therefore, FTI Consulting also believes that these measures, considered along with
corresponding GAAP measures, provide management and investors with additional information for comparison of its operating results with the operating results of other companies.
FTI Consulting defines Adjusted Net Income and Adjusted Earnings per Diluted Share (Adjusted EPS), which
are
Non-GAAP
financial measures, as net income and earnings per diluted share, respectively, excluding the impact of remeasurement of acquisition-related contingent consideration, special charges, goodwill
impairment charges and losses on early extinguishment of debt. FTI Consulting uses Adjusted Net Income for the purpose of calculating Adjusted EPS. Management of FTI Consulting uses Adjusted EPS to assess total company operating performance on a
consistent basis. FTI Consulting believes that this
Non-GAAP
financial measure, which excludes the effects of the remeasurement of acquisition-related contingent consideration, special charges, goodwill
impairment charges and losses on early extinguishment of debt, when considered together with its GAAP financial results, provides management and investors with an additional understanding of its business operating results, including underlying
trends.
Non-GAAP
financial measures are not defined in the same manner by all companies and may
not be comparable with other similarly titled measures of other companies.
Non-GAAP
financial measures should be considered in addition to, but not as a substitute for or superior to, the information contained
in FTI Consultings Condensed Consolidated Statements of Comprehensive Income. Reconciliations of GAAP to
Non-GAAP
financial measures to the most directly comparable GAAP financial measures are included
in the accompanying tables to the Press Release.
The information included herein, including Exhibit 99.1 furnished herewith, shall not be
deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into
any filing pursuant to the Securities Act of 1933, as amended, or the Exchange Act, regardless of any incorporation by reference language in any such filing, except as expressly set forth by specific reference in such filing.