Charles River Associates (CRA) Reports Fourth-Quarter and Full-Year 2024 Financial Results

Rhea-AI Summary

Charles River Associates (NASDAQ: CRAI) reported strong financial results for Q4 and full-year 2024. Q4 revenue grew 9.2% year-over-year to $176.4 million, with double-digit growth in Energy, Finance, and Intellectual Property practices. Q4 net income increased 30.8% to $15.0 million.

Full-year 2024 revenue grew 10.2% to $687.4 million with 75% utilization. Annual net income rose 21.2% to $46.7 million. The company returned $45.6 million to shareholders through $12.3 million in dividends and $33.3 million in share repurchases.

For fiscal 2025, CRA expects revenue between $715-735 million and non-GAAP EBITDA margin of 12.0-13.0%. The Board authorized a $45 million expansion of the share repurchase program and declared a quarterly dividend of $0.49 per share.

Positive

• Q4 revenue increased 9.2% YoY to $176.4 million
• Q4 net income grew 30.8% YoY to $15.0 million
• Full-year revenue up 10.2% to $687.4 million
• Board authorized $45 million expansion of share repurchase program
• Strong performance across multiple practice areas

Negative

• Q4 quarter-end headcount decreased 5.8% year over year
• Company noted uncertain global macroeconomic conditions as potential risk

Insights

Financial Analyst

The Q4 and full-year 2024 results from Charles River Associates showcase exceptional financial execution and operational efficiency. The company's revenue growth of 9.2% in Q4 and 10.2% for the full year demonstrates strong market positioning, particularly noteworthy given the challenging macroeconomic environment.

Several key performance indicators deserve attention. The 78% utilization rate in Q4, coupled with a 5.8% reduction in headcount, indicates improved operational efficiency and resource optimization. This has translated into substantial margin expansion, with Q4 EBITDA margin reaching 13.9%, up from 11.8% in the previous year. The ability to grow revenue while reducing headcount suggests successful pricing power and project mix optimization.

The geographic revenue distribution reveals an interesting dynamic: international operations grew 15.7% compared to 7.8% in North America, indicating successful market diversification and global expansion strategies. This geographic diversification provides a natural hedge against regional economic fluctuations.

The company's capital return strategy is particularly robust. The $45M expansion of the share repurchase program, combined with the existing $13.1M authorization and the quarterly dividend of $0.49 per share, represents a comprehensive approach to shareholder returns. In fiscal 2024, CRA returned $45.6M to shareholders through dividends and share repurchases, demonstrating strong free cash flow generation.

Looking ahead, the FY2025 guidance of $715M-$735M revenue implies growth of 4-7%, with targeted EBITDA margins of 12-13%. While this suggests some normalization in growth rates, it still represents healthy expansion in a consulting industry where scale and expertise increasingly drive competitive advantage.

Broad-based Contributions Drive Record Revenue and Profitability in Fiscal 2024

Fourth Quarter Revenue Increases 9.2% Year Over Year

Board Expands Share Repurchase Authorization by $45 Million

BOSTON--(BUSINESS WIRE)-- Charles River Associates (NASDAQ: CRAI), a worldwide leader in providing economic, financial and management consulting services, today announced financial results for the fourth quarter and fiscal year ended December 28, 2024.

“CRA achieved another record year, surpassing fiscal 2023’s revenue milestone,” said Paul Maleh, CRA’s President and Chief Executive Officer. “Strong top-line growth drove even greater increases in net income, earnings per diluted share, and EBITDA. For the fourth quarter, we continued to see strength across our portfolio of services. Revenue increased 9.2% compared with the fourth quarter of fiscal 2023 to $176.4 million. Three practices—Energy, Finance, and Intellectual Property—led the way, each generating double-digit revenue growth, while our Antitrust & Competition Economics, Labor & Employment, Risk, Investigations & Analytics and Life Sciences practices achieved year-over-year growth. Our North American and international operations both contributed to the quarter’s revenue growth, increasing 7.8% and 15.7%, respectively.”

Highlights for Fourth Quarter Fiscal 2024

• Revenue grew 9.2% year over year to $176.4 million.
• Utilization was 78% and quarter-end headcount decreased 5.8% year over year.
• Net income increased 30.8% year over year to $15.0 million, or 8.5% of revenue, compared with $11.5 million, or 7.1% of revenue, in the fourth quarter of fiscal 2023; non-GAAP net income increased 21.2% year over year to $14.0 million, or 7.9% of revenue, compared with $11.5 million, or 7.1% of revenue, in the fourth quarter of fiscal 2023.
• Earnings per diluted share increased 34.6% year over year to $2.18 from $1.62 in the fourth quarter of fiscal 2023; non-GAAP earnings per diluted share increased 24.5% year over year to $2.03 from $1.63 in the fourth quarter of fiscal 2023.
• Non-GAAP EBITDA increased 28.4% to $24.4 million, or 13.9% of revenue, compared with $19.0 million, or 11.8% of revenue, in the fourth quarter of fiscal 2023.
• On a constant currency basis relative to the fourth quarter of fiscal 2023, revenue, GAAP net income, and earnings per diluted share would have been lower by $0.6 million, $0.1 million, and $0.01 per diluted share, respectively. Non-GAAP net income and non-GAAP earnings per diluted share would have been lower by $0.1 million and $0.01 per diluted share, respectively. Non-GAAP EBITDA would have remained unchanged.
• CRA returned $3.4 million of capital to its shareholders via dividend payments.

Highlights for Full-Year Fiscal 2024

• Revenue grew 10.2% year over year to $687.4 million with company-wide utilization of 75%.
• GAAP net income increased 21.2% year over year to $46.7 million, or 6.8% of revenue, or $6.74 per diluted share, compared with $38.5 million, or 6.2% of revenue, or $5.39 per diluted share for the full year fiscal 2023. Non-GAAP net income increased 35.0% year over year to $52.6 million, or 7.7% of revenue, or $7.60 per diluted share, compared with $39.0 million, or 6.2% of revenue, or $5.46 per diluted share for the full year fiscal 2023.
• Non-GAAP EBITDA grew 32.4% to $90.4 million, or 13.2% of revenue, compared with $68.3 million, or 10.9% of revenue, in fiscal 2023.
• On a constant currency basis relative to fiscal 2023, revenue, GAAP net income, and earnings per diluted share would have been lower by $2.2 million, $0.4 million, and $0.05 per diluted share, respectively. Non-GAAP net income, non-GAAP earnings per diluted share, and non-GAAP EBITDA would have been lower by $0.3 million, $0.05 per diluted share, and $0.4 million, respectively.
• For fiscal 2024, CRA returned $45.6 million of capital to its shareholders, consisting of $12.3 million in dividend payments and $33.3 million in share repurchases of approximately 206,000 shares.

Management Commentary and Financial Guidance

“CRA reported revenue for fiscal 2024 of $687.4 million, or $685.2 million on a constant currency basis relative to fiscal 2023,” said Maleh. “Full-year, non-GAAP EBITDA was $90.4 million, or $90.0 million on a constant currency basis relative to fiscal 2023. Non-GAAP EBITDA margin was 13.1% on a constant currency basis. This performance exceeds the top end of our previously stated financial guidance for fiscal 2024.”

“Our fiscal 2024 financial performance demonstrates our continued strength in the marketplace. For full-year fiscal 2025, on a constant currency basis relative to fiscal 2024, we expect revenue in the range of $715 million to $735 million, and non-GAAP EBITDA margin in the range of 12.0% to 13.0%. While we are pleased with CRA’s strong performance in 2024, we remain mindful that uncertain global macroeconomic, business, and political conditions can affect our business.”

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.

Share Repurchase Expansion and Quarterly Dividend

On February 20, 2025, CRA’s Board of Directors authorized a $45.0 million expansion of the Company’s existing share repurchase program, in addition to the $13.1 million currently remaining under the program. CRA may repurchase shares of its common stock in the open market or in privately negotiated transactions in accordance with applicable insider trading and other securities laws and regulations. The timing, amount and extent to which CRA repurchases shares will depend upon market conditions and other factors it may consider in its sole discretion.

The Board of Directors also authorized a quarterly cash dividend of $0.49 per common share, payable on March 14, 2025 to shareholders of record as of March 4, 2025. 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 fourth-quarter and fiscal-year 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 (gains) losses, net, restructuring costs 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 (gains) losses, net, restructuring costs 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.

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 2025 on a constant currency basis relative to fiscal 2024 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.

	CRA INTERNATIONAL, INC.
	CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
	FOR THE FISCAL QUARTERS AND FISCAL YEAR-TO-DATE PERIODS ENDED
	DECEMBER 28, 2024 COMPARED TO DECEMBER 30, 2023
	(IN THOUSANDS, EXCEPT PER SHARE DATA)
	Fiscal Quarter Ended														Fiscal Year-to-Date Period Ended
	December 28, 2024				As a % of Revenue			December 30, 2023				As a % of Revenue			December 28, 2024				As a % of Revenue			December 30, 2023				As a % of Revenue
Revenues	$	176,435			100.0	%		$	161,613			100.0	%		$	687,414			100.0	%		$	623,976			100.0	%
Cost of services (exclusive of depreciation and amortization)		120,541			68.3	%			112,688			69.7	%			479,936			69.8	%			439,751			70.5	%
Selling, general and administrative expenses		31,266			17.7	%			28,979			17.9	%			125,050			18.2	%			115,116			18.4	%
Depreciation and amortization		3,174			1.8	%			2,801			1.7	%			11,677			1.7	%			11,564			1.9	%
Income from operations		21,454			12.2	%			17,145			10.6	%			70,751			10.3	%			57,545			9.2	%
Interest expense, net		(1,013	)		-0.6	%			(600	)		-0.4	%			(4,417	)		-0.6	%			(3,812	)		-0.6	%
Foreign currency gains (losses), net		1,145			0.6	%			(987	)		-0.6	%			(92	)		-	%			(1,445	)		-0.2	%
Income before provision for income taxes		21,586			12.2	%			15,558			9.6	%			66,242			9.6	%			52,288			8.4	%
Provision for income taxes		6,599			3.7	%			4,099			2.5	%			19,589			2.8	%			13,807			2.2	%
Net income	$	14,987			8.5	%		$	11,459			7.1	%		$	46,653			6.8	%		$	38,481			6.2	%
Net income per share:
Basic	$	2.21						$	1.65						$	6.82						$	5.48
Diluted	$	2.18						$	1.62						$	6.74						$	5.39
Weighted average number of shares outstanding:
Basic		6,763							6,954							6,821							7,008
Diluted		6,866							7,057							6,908							7,118

	CRA INTERNATIONAL, INC.
	RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
	FOR THE FISCAL QUARTERS AND FISCAL YEAR-TO-DATE PERIODS ENDED
	DECEMBER 28, 2024 COMPARED TO DECEMBER 30, 2023
	(IN THOUSANDS, EXCEPT PER SHARE DATA)
	Fiscal Quarter Ended														Fiscal Year-to-Date Period Ended
	December 28, 2024				As a % of Revenue			December 30, 2023				As a % of Revenue			December 28, 2024				As a % of Revenue			December 30, 2023				As a % of Revenue
Revenues	$	176,435			100.0	%		$	161,613			100.0	%		$	687,414			100.0	%		$	623,976			100.0	%
Net income	$	14,987			8.5	%		$	11,459			7.1	%		$	46,653			6.8	%		$	38,481			6.2	%
Adjustments needed to reconcile GAAP net income to non-GAAP net income:
Non-cash valuation change in contingent consideration		(190	)		-0.1	%			(918	)		-0.6	%			(190	)		-	%			(866	)		-0.1	%
Restructuring (1)		-			-	%			-			-	%			8,176			1.2	%			-			-	%
Acquisition-related costs		-			-	%			-			-	%			-			-	%			22			-	%
Foreign currency (gains) losses, net		(1,145	)		-0.6	%			987			0.6	%			92			-	%			1,445			0.2	%
Tax effect on adjustments		340			0.2	%			13			-	%			(2,126	)		-0.3	%			(125	)		-	%
Non-GAAP net income	$	13,992			7.9	%		$	11,541			7.1	%		$	52,605			7.7	%		$	38,957			6.2	%
Non-GAAP net income per share:
Basic	$	2.06						$	1.66						$	7.69						$	5.54
Diluted	$	2.03						$	1.63						$	7.60						$	5.46
Weighted average number of shares outstanding:
Basic		6,763							6,954							6,821							7,008
Diluted		6,866							7,057							6,908							7,118
(1) Includes cash severance of $2.5M and non-cash charges of $5.7M associated with portfolio optimization actions.

	CRA INTERNATIONAL, INC.
	RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
	FOR THE FISCAL QUARTERS AND FISCAL YEAR-TO-DATE PERIODS ENDED
	DECEMBER 28, 2024 COMPARED TO DECEMBER 30, 2023
	(IN THOUSANDS)
	Fiscal Quarter Ended														Fiscal Year-to-Date Period Ended
	December 28, 2024				As a % of Revenue			December 30, 2023				As a % of Revenue			December 28, 2024				As a % of Revenue			December 30, 2023				As a % of Revenue
Revenues	$	176,435			100.0	%		$	161,613			100.0	%		$	687,414			100.0	%		$	623,976			100.0	%
Net income	$	14,987			8.5	%		$	11,459			7.1	%		$	46,653			6.8	%		$	38,481			6.2	%
Adjustments needed to reconcile GAAP net income to non-GAAP net income:
Non-cash valuation change in contingent consideration		(190	)		-0.1	%			(918	)		-0.6	%			(190	)		-	%			(866	)		-0.1	%
Restructuring (1)		-			-	%			-			-	%			8,176			1.2	%			-			-	%
Acquisition-related costs		-			-	%			-			-	%			-			-	%			22			-	%
Foreign currency (gains) losses, net		(1,145	)		-0.6	%			987			0.6	%			92			-	%			1,445			0.2	%
Tax effect on adjustments		340			0.2	%			13			-	%			(2,126	)		-0.3	%			(125	)		-	%
Non-GAAP net income	$	13,992			7.9	%		$	11,541			7.1	%		$	52,605			7.7	%		$	38,957			6.2	%
Adjustments needed to reconcile non-GAAP net income to non-GAAP EBITDA:
Interest expense, net		1,013			0.6	%			600			0.4	%			4,417			0.6	%			3,812			0.6	%
Provision for income taxes		6,259			3.5	%			4,086			2.5	%			21,715			3.2	%			13,932			2.2	%
Depreciation and amortization		3,174			1.8	%			2,801			1.7	%			11,677			1.7	%			11,564			1.9	%
Non-GAAP EBITDA	$	24,438			13.9	%		$	19,028			11.8	%		$	90,414			13.2	%		$	68,265			10.9	%
(1) Includes cash severance of $2.5M and non-cash charges of $5.7M associated with portfolio optimization actions.

CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
	December 28, 2024			December 30, 2023
Assets
Cash and cash equivalents	$	26,711		$	45,586
Accounts receivable and unbilled services, net		219,548			199,556
Other current assets		23,104			20,334
Total current assets		269,363			265,476
Property and equipment, net		45,205			38,176
Goodwill and intangible assets, net		100,953			101,185
Right-of-use assets		81,157			86,887
Other assets		74,761			61,487
Total assets	$	571,439		$	553,211
Liabilities and Shareholders’ Equity
Accounts payable	$	28,155		$	28,701
Accrued expenses		181,413			171,040
Current portion of lease liabilities		18,696			16,475
Other current liabilities		23,045			19,871
Total current liabilities		251,309			236,087
Non-current portion of lease liabilities		84,541			92,280
Other non-current liabilities		23,516			12,743
Total liabilities		359,366			341,110
Total shareholders’ equity		212,073			212,101
Total liabilities and shareholders’ equity	$	571,439		$	553,211

CRA INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
	Year Ended
	December 28, 2024				December 30, 2023
Operating activities:
Net income	$	46,653			$	38,481
Adjustments to reconcile net income to net cash provided by operating activities, net of effect of acquired businesses:
Non-cash items, net		29,316				26,197
Accounts receivable and unbilled services		(22,197	)			(2,860	)
Working capital items, net		(4,037	)			(1,746	)
Net cash provided by operating activities		49,735				60,072
Investing activities:
Purchases of property and equipment		(16,623	)			(2,366	)
Consideration paid for acquisitions, net		(1,500	)			(577	)
Net cash used in investing activities		(18,123	)			(2,943	)
Financing activities:
Issuance of common stock, principally stock options exercises		-				805
Borrowings under revolving line of credit		102,000				105,000
Repayments under revolving line of credit		(102,000	)			(105,000	)
Tax withholding payments reimbursed by shares		(3,209	)			(3,063	)
Cash dividends paid		(12,300	)			(10,807	)
Repurchase of common stock		(33,348	)			(31,417	)
Net cash used in financing activities		(48,857	)			(44,482	)
Effect of foreign exchange rates on cash and cash equivalents		(1,630	)			1,492
Net increase (decrease) in cash and cash equivalents		(18,875	)			14,139
Cash and cash equivalents at beginning of period		45,586				31,447
Cash and cash equivalents at end of period	$	26,711			$	45,586
Noncash investing and financing activities:
Increase (decrease) in accounts payable and accrued expenses for property and equipment	$	598			$	(91	)
Excise tax on share repurchases	$	(270	)		$	(247	)
Asset retirement obligations	$	191			$	-
Right-of-use assets obtained in exchange for lease obligations	$	10,084			$	3,198
Supplemental cash flow information:
Cash paid for taxes	$	21,444			$	14,011
Cash paid for interest	$	4,145			$	3,539
Cash paid for amounts included in operating lease liabilities	$	20,963			$	22,272

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250220132389/en/

Dan Mahoney

Chief Financial Officer

Charles River Associates

617-425-3505

Nicholas Manganaro

Sharon Merrill Advisors

crai@investorrelations.com

617-542-5300

Source: Charles River Associates

FAQ

What was CRAI's revenue growth in Q4 2024?

CRAI's revenue grew 9.2% year-over-year to $176.4 million in Q4 2024.

How much did CRAI return to shareholders in fiscal 2024?

CRAI returned $45.6 million to shareholders in fiscal 2024, comprising $12.3 million in dividends and $33.3 million in share repurchases.

What is CRAI's revenue guidance for fiscal 2025?

CRAI expects revenue between $715 million and $735 million for fiscal 2025 on a constant currency basis.

How much did CRAI expand its share repurchase program by?

CRAI's Board authorized a $45 million expansion of the existing share repurchase program on February 20, 2025.

What is CRAI's quarterly dividend payment for Q1 2025?

CRAI declared a quarterly dividend of $0.49 per share, payable on March 14, 2025.