Huron Announces Second Quarter 2022 Financial Results and Updates 2022 Guidance

Rhea-AI Summary

Huron reported strong financial results for Q2 2022, with revenues up 18.8% year-over-year to $273.3 million, and net income rising 8.4% to $13.9 million. Diluted EPS increased 11.9% to $0.66. Adjusted EBITDA grew 29.6% to $33.2 million, driven by a 47% growth in digital services across healthcare, education, and commercial sectors. For the first half of 2022, revenues reached $533.4 million, a 23.1% increase, alongside a revised revenue guidance of $1.04 billion to $1.08 billion for the full year. The company also repurchased 1.0 million shares for $52.2 million.

Positive

• Q2 2022 revenues increased 18.8% to $273.3 million.
• Net income rose 8.4% to $13.9 million.
• Adjusted EBITDA up 29.6% to $33.2 million, 12.2% of revenues.
• Digital services revenue grew 47% year-over-year.
• Q1-Q2 2022 revenues increased 23.1% to $533.4 million.
• Revised full-year revenue guidance to $1.04 billion - $1.08 billion.

Negative

• Utilization rate of Consulting decreased to 73.2% from 74.6% year-over-year.

SECOND QUARTER 2022 HIGHLIGHTS

• Revenues increased $43.2 million, or 18.8%, to $273.3 million in Q2 2022 from $230.1 million in Q2 2021.

• Net income increased $1.1 million, or 8.4%, to $13.9 million in Q2 2022 from $12.8 million in Q2 2021.

• Adjusted EBITDA⁽⁷⁾, a non-GAAP measure, increased $7.6 million, or 29.6%, to $33.2 million in Q2 2022 from $25.6 million in Q2 2021.

• Diluted earnings per share increased $0.07, or 11.9%, to $0.66 in Q2 2022 from $0.59 in Q2 2021.

• Adjusted diluted earnings per share⁽⁷⁾, a non-GAAP measure, increased $0.14, or 20.3%, to $0.83 in Q2 2022 from $0.69 in Q2 2021.

• Huron repurchased 0.5 million shares of the company’s common stock for $28.3 million in Q2 2022.

YEAR-TO-DATE 2022 HIGHLIGHTS AND 2022 GUIDANCE

• Revenues increased $100.0 million, or 23.1%, to $533.4 million for the first six months of 2022 from $433.3 million for the same prior year period.

• Net income increased $22.5 million to $40.7 million for the first six months of 2022 from $18.2 million for the same prior year period. Results for the first six months of 2022 include an unrealized gain of $19.8 million, net of tax, on the company's investment in a hospital-at-home company recognized in Q1 2022.

• Adjusted EBITDA⁽⁷⁾, a non-GAAP measure, increased $13.3 million, or 31.5%, to $55.3 million for the first six months of 2022 from $42.1 million for the same prior year period.

• Diluted earnings per share increased $1.12 to $1.94 for the first six months of 2022 from $0.82 for the same prior year period.

• Adjusted diluted earnings per share⁽⁷⁾, a non-GAAP measure, increased $0.29, or 28.2%, to $1.32 for the first six months of 2022 from $1.03 for the same prior year period.

• Huron repurchased 1.0 million shares of the company’s common stock for $52.2 million in the first six months of 2022.

• Huron updates its previous earnings guidance range for full year 2022, including increasing and narrowing revenue expectations to a range of $1.04 billion to $1.08 billion.

CHICAGO--(BUSINESS WIRE)-- Global professional services firm Huron (NASDAQ: HURN) today announced financial results for the second quarter ended June 30, 2022.

“Strong demand across all three operating segments enabled us to achieve 19% revenue growth over the prior year quarter. Our Digital capability, serving the healthcare, education, and commercial industries, grew 47% over the prior year quarter, reflecting ongoing strong demand for our digital transformation offerings across each segment,” said James H. Roth, chief executive officer of Huron. “Despite uncertainties in the macro environment, we are raising our revenue and earnings guidance based on our view of the demand outlook for our core offerings for the remainder of the year.”

SECOND QUARTER 2022 RESULTS

Revenues increased $43.2 million, or 18.8%, to $273.3 million for the second quarter of 2022, compared to $230.1 million for the second quarter of 2021.

Net income increased $1.1 million, or 8.4%, to $13.9 million for the second quarter of 2022, compared to $12.8 million for the same quarter last year. Diluted earnings per share increased $0.07, or 11.9%, to $0.66 for the second quarter of 2022, compared to $0.59 for the second quarter of 2021.

Second quarter 2022 earnings before interest, taxes, depreciation and amortization ("EBITDA")⁽⁷⁾ increased $6.4 million, or 25.7%, to $31.2 million, compared to $24.8 million in the same prior year period.

In addition to using EBITDA to evaluate the company’s financial performance, management uses other non-GAAP financial measures, which exclude the effect of the following items (in thousands):

	Three Months Ended June 30,
	2022				2021
Amortization of intangible assets	$	2,818			$	2,289
Restructuring charges	$	2,069			$	861
Other losses	$	21			$	—
Transaction-related expenses	$	—			$	(29	)
Tax effect of adjustments	$	(1,301	)		$	(827	)
Foreign currency transaction gains, net	$	(100	)		$	(48	)

Adjusted EBITDA⁽⁷⁾ increased $7.6 million, or 29.6%, to $33.2 million, or 12.2% of revenues, in the second quarter of 2022, compared to $25.6 million, or 11.1% of revenues, in the same quarter last year. Adjusted net income⁽⁷⁾ increased $2.4 million to $17.5 million, or $0.83 per diluted share, for the second quarter of 2022, compared to $15.1 million, or $0.69 per diluted share, for the same quarter in 2021.

The number of revenue-generating professionals⁽¹⁾ increased 22.7% to 4,243 as of June 30, 2022 from 3,459 as of June 30, 2021. The utilization rate⁽⁵⁾ of the company's Consulting capability decreased to 73.2% during the second quarter 2022, compared to 74.6% during the same period last year. The utilization rate⁽⁵⁾ for the company's Digital capability increased to 74.3% during the second quarter 2022, compared to 73.2% during the same period last year.

Additionally, in the second quarter of 2022, Huron repurchased 497,547 shares of the company’s common stock for $28.3 million.

YEAR-TO-DATE 2022 RESULTS

Revenues increased $100.0 million, or 23.1%, to $533.4 million for the first six months of 2022, compared to $433.3 million for the first six months of 2021.

Net income increased $22.5 million to $40.7 million for the first six months of 2022, compared to $18.2 million for the first six months of 2021. Diluted earnings per share increased $1.12 to $1.94 for the second quarter of 2022, compared to $0.82 for the same period last year. Results for the first six months of 2022 include an unrealized gain of $19.8 million, net of tax, related to the increase in fair value of the company's investment in a hospital-at-home company.

EBITDA⁽⁷⁾ for the first six months of 2022 increased $38.6 million, or 96.4%, to $78.7 million, compared to $40.0 million in the same prior year period.

In addition to using EBITDA to evaluate the company’s financial performance, management uses other non-GAAP financial measures, which exclude the effect of the following items (in thousands):

	Six Months Ended June 30,
	2022				2021
Amortization of intangible assets	$	5,678			$	4,688
Restructuring charges	$	3,624			$	1,489
Other losses	$	33			$	42
Transaction-related expenses	$	50			$	141
Unrealized gain on preferred stock investment	$	(26,964	)		$	—
Tax effect of adjustments	$	4,658			$	(1,685	)
Foreign currency transaction losses (gains), net	$	(81	)		$	355

Adjusted EBITDA⁽⁷⁾ increased $13.3 million, or 31.5%, to $55.3 million, or 10.4% of revenues, for the first six months of 2022, compared to $42.1 million, or 9.7% of revenues, for the same period last year. Adjusted net income⁽⁷⁾ increased $4.9 million, or 21.5%, to $27.8 million, or $1.32 per diluted share, for the first six months of 2022, compared to $22.9 million, or $1.03 per diluted share, for the first six months of 2021.

The number of revenue-generating professionals⁽¹⁾ increased 22.7% to 4,243 as of June 30, 2022 from 3,459 as of June 30, 2021. The utilization rate⁽⁵⁾ of the company's Consulting capability increased to 72.4% during the first six months of 2022, compared to 70.5% during the same period last year. The utilization rate⁽⁵⁾ for the company's Digital capability increased to 73.6% during the first six months 2022, compared to 72.3% during the same period last year.

Additionally, in the first six months of 2022, Huron repurchased 1,020,946 shares of the company’s common stock for $52.2 million, representing 4.7% of the common stock outstanding as of December 31, 2021.

OPERATING INDUSTRIES

Huron’s results reflect a portfolio of service offerings focused on helping clients address complex business challenges.

The company’s year-to-date 2022 revenues by operating segment as a percentage of total company revenues are as follows: Healthcare (47%); Education (32%); and Commercial (21%). Financial results by operating industry are included in the attached schedules and in Huron's forthcoming Quarterly Report on Form 10-Q filing for the quarter ended June 30, 2022.

OUTLOOK FOR 2022

Based on currently available information, the company increased and narrowed guidance for full year 2022 revenues before reimbursable expenses to a range of $1.04 billion to $1.08 billion. The company anticipates adjusted EBITDA as a percentage of revenues in a range of 11.5% to 12.0% and non-GAAP adjusted diluted earnings per share in a range of $3.15 to $3.45.

Management will provide a more detailed discussion of its outlook during the company's earnings conference call webcast.

SECOND QUARTER 2022 WEBCAST

The company will host a webcast to discuss its financial results today, July 28, 2022, at 5:00 p.m. Eastern Time, 4:00 p.m. Central Time. The conference call is being webcast by Notified and can be accessed from Huron's website at http://ir.huronconsultinggroup.com. A replay will be available approximately two hours after the conclusion of the webcast and for 90 days thereafter.

USE OF NON-GAAP FINANCIAL MEASURES⁽⁷⁾

In evaluating the company’s financial performance and outlook, management uses EBITDA, adjusted EBITDA, adjusted EBITDA as a percentage of revenues, adjusted net income, and adjusted diluted earnings per share, which are non-GAAP measures. Management uses these non-GAAP financial measures to gain an understanding of the company's comparative operating performance (when comparing such results with previous periods or forecasts). These non-GAAP financial measures are used by management in their financial and operating decision making because management believes they reflect the company's ongoing business in a manner that allows for meaningful period-to-period comparisons. Management also uses these non-GAAP financial measures when publicly providing their business outlook, for internal management purposes, and as a basis for evaluating potential acquisitions and dispositions. Management believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Huron’s current operating performance and future prospects in the same manner as management does, if they so choose, and in comparing in a consistent manner Huron’s current financial results with Huron’s past financial results. Investors should recognize that these non-GAAP measures might not be comparable to similarly titled measures of other companies. These measures should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flows or liquidity prepared in accordance with accounting principles generally accepted in the United States.

Management has provided its outlook regarding adjusted EBITDA and adjusted diluted earnings per share, both of which are non-GAAP financial measures and exclude certain charges. Management has not reconciled these non-GAAP financial measures to the corresponding GAAP financial measures because guidance for the various reconciling items is not provided. Management is unable to provide guidance for these reconciling items because they cannot determine their probable significance, as certain items are outside of the company's control and cannot be reasonably predicted since these items could vary significantly from period to period. Accordingly, reconciliations to the corresponding GAAP financial measures are not available without unreasonable effort.

ABOUT HURON

Huron is a global professional services firm that collaborates with clients to put possible into practice by creating sound strategies, optimizing operations, accelerating digital transformation, and empowering businesses and their people to own their future. By embracing diverse perspectives, encouraging new ideas and challenging the status quo, we create sustainable results for the organizations we serve. Learn more at www.huronconsultinggroup.com.

Statements in this press release that are not historical in nature, including those concerning the company’s current expectations about its future results, are “forward-looking” statements as defined in Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified by words such as “may,” “should,” “expects,” “provides,” “anticipates,” “assumes,” “can,” “will,” “meets,” “could,” “likely,” “intends,” “might,” “predicts,” “seeks,” “would,” “believes,” “estimates,” “plans,” “continues,” “goals,” “guidance,” or “outlook” or similar expressions. These forward-looking statements reflect the company's current expectations about future requirements and needs, results, levels of activity, performance, or achievements. Some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: the impact of the COVID-19 pandemic on the economy, our clients and client demand for our services, and our ability to sell and provide services, including the measures taken by governmental authorities and businesses in response to the pandemic, which may cause or contribute to other risks and uncertainties that we face; failure to achieve expected utilization rates, billing rates and the number of revenue-generating professionals; inability to expand or adjust our service offerings in response to market demands; our dependence on renewal of client-based services; dependence on new business and retention of current clients and qualified personnel; failure to maintain third-party provider relationships and strategic alliances; inability to license technology to and from third parties; the impairment of goodwill; various factors related to income and other taxes; difficulties in successfully integrating the businesses we acquire and achieving expected benefits from such acquisitions; risks relating to privacy, information security, and related laws and standards; and a general downturn in market conditions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors, including, among others, those described under “Item 1A. Risk Factors” in Huron's Annual Report on Form 10-K for the year ended December 31, 2021 that may cause actual results, levels of activity, performance or achievements to be materially different from any anticipated results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. The company disclaims any obligation to update or revise any forward-looking statements as a result of new information or future events, or for any other reason.

HURON CONSULTING GROUP INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS) (In thousands, except per share amounts) (Unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2022				2021				2022				2021
Revenues and reimbursable expenses:
Revenues	$	273,325			$	230,126			$	533,374			$	433,339
Reimbursable expenses		7,492				3,252				12,218				5,186
Total revenues and reimbursable expenses		280,817				233,378				545,592				438,525
Operating expenses:
Direct costs (exclusive of depreciation and amortization included below)		189,233				161,526				376,480				309,641
Reimbursable expenses		7,576				3,316				12,332				5,319
Selling, general and administrative expenses		46,033				45,190				94,428				84,998
Restructuring charges		2,069				861				3,624				1,489
Depreciation and amortization		6,902				6,356				13,766				12,709
Total operating expenses		251,813				217,249				500,630				414,156
Operating income		29,004				16,129				44,962				24,369
Other income (expense), net:
Interest expense, net of interest income		(2,446	)			(2,029	)			(4,642	)			(3,748	)
Other income (expense), net		(4,881	)			2,151				19,484				2,571
Total other income (expense), net		(7,327	)			122				14,842				(1,177	)
Income before taxes		21,677				16,251				59,804				23,192
Income tax expense		7,802				3,454				19,077				4,990
Net income	$	13,875			$	12,797			$	40,727			$	18,202
Earnings per share:
Net income per basic share	$	0.67			$	0.59			$	1.97			$	0.84
Net income per diluted share	$	0.66			$	0.59			$	1.94			$	0.82
Weighted average shares used in calculating earnings per share:
Basic		20,582				21,555				20,715				21,743
Diluted		20,967				21,871				21,047				22,105
Comprehensive income (loss):
Net income	$	13,875			$	12,797			$	40,727			$	18,202
Foreign currency translation adjustments, net of tax		(656	)			82				(699	)			482
Unrealized gain (loss) on investment, net of tax		773				1,422				(1,888	)			(3,226	)
Unrealized gain on cash flow hedging instruments, net of tax		971				218				5,296				1,647
Other comprehensive income (loss)		1,088				1,722				2,709				(1,097	)
Comprehensive income	$	14,963			$	14,519			$	43,436			$	17,105

HURON CONSULTING GROUP INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) (Unaudited)
	June 30, 2022				December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	11,958			$	20,781
Receivables from clients, net		150,973				122,316
Unbilled services, net		118,825				91,285
Income tax receivable		677				8,071
Prepaid expenses and other current assets		21,279				15,229
Total current assets		303,712				257,682
Property and equipment, net		27,214				31,004
Deferred income taxes, net		1,775				1,804
Long-term investments		96,982				72,584
Operating lease right-of-use assets		32,018				35,311
Other non-current assets		64,096				68,191
Intangible assets, net		28,271				31,894
Goodwill		623,841				620,879
Total assets	$	1,177,909			$	1,119,349
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	10,983			$	13,621
Accrued expenses and other current liabilities		25,549				22,519
Accrued payroll and related benefits		92,738				139,131
Current maturities of long-term debt		—				559
Current maturities of operating lease liabilities		10,241				10,142
Deferred revenues		18,969				19,212
Total current liabilities		158,480				205,184
Non-current liabilities:
Deferred compensation and other liabilities		32,370				43,458
Long-term debt, net of current portion		342,000				232,221
Operating lease liabilities, net of current portion		49,093				54,313
Deferred income taxes, net		20,607				12,273
Total non-current liabilities		444,070				342,265
Commitments and contingencies
Stockholders’ equity
Common stock; $0.01 par value; 500,000,000 shares authorized; 23,492,632 and 24,364,814 shares issued, respectively		232				239
Treasury stock, at cost, 2,681,730 and 2,495,172 shares, respectively		(136,425	)			(135,969	)
Additional paid-in capital		374,280				413,794
Retained earnings		317,723				276,996
Accumulated other comprehensive income		19,549				16,840
Total stockholders’ equity		575,359				571,900
Total liabilities and stockholders’ equity	$	1,177,909			$	1,119,349

HURON CONSULTING GROUP INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited)
	Six Months Ended June 30,
	2022				2021
Cash flows from operating activities:
Net income	$	40,727			$	18,202
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation and amortization		13,766				12,923
Non-cash lease expense		3,174				3,301
Share-based compensation		15,166				11,566
Amortization of debt discount and issuance costs		397				397
Allowances for doubtful accounts		47				—
Deferred income taxes		7,089				(48	)
Gain on sale of property and equipment, excluding transaction costs		(1,117	)			(158	)
Change in fair value of contingent consideration liabilities		33				42
Change in fair value of preferred stock investment		(26,964	)			—
Other, net		—				(78	)
Changes in operating assets and liabilities, net of acquisitions and divestiture:
(Increase) decrease in receivables from clients, net		(28,825	)			(27,749	)
(Increase) decrease in unbilled services, net		(28,329	)			(36,088	)
(Increase) decrease in current income tax receivable / payable, net		9,394				3,366
(Increase) decrease in other assets		3,984				(1,117	)
Increase (decrease) in accounts payable and other liabilities		(13,524	)			5,038
Increase (decrease) in accrued payroll and related benefits		(43,420	)			(42,487	)
Increase (decrease) in deferred revenues		(1,834	)			(9,080	)
Net cash used in operating activities		(50,236	)			(61,970	)
Cash flows from investing activities:
Purchases of property and equipment		(6,800	)			(5,439	)
Investment in life insurance policies		—				(77	)
Purchases of businesses, net of cash acquired		(1,948	)			(5,886	)
Capitalization of internally developed software costs		(3,974	)			(2,508	)
Proceeds from note receivable		157				—
Proceeds from sale of property and equipment		4,750				158
Divestiture of business		207				—
Net cash used in investing activities		(7,608	)			(13,752	)
Cash flows from financing activities:
Proceeds from exercise of stock options		1,185				422
Shares redeemed for employee tax withholdings		(7,011	)			(8,651	)
Share repurchases		(52,443	)			(35,243	)
Proceeds from bank borrowings		224,000				139,000
Repayments of bank borrowings		(114,780	)			(74,270	)
Deferred payment on business acquisition		(1,875	)			—
Net cash used in financing activities		49,076				21,258
Effect of exchange rate changes on cash		(55	)			269
Net decrease in cash and cash equivalents		(8,823	)			(54,195	)
Cash and cash equivalents at beginning of the period		20,781				67,177
Cash and cash equivalents at end of the period	$	11,958			$	12,982

HURON CONSULTING GROUP INC. SEGMENT OPERATING RESULTS AND OTHER OPERATING DATA (Unaudited)
		Three Months Ended June 30,								Percent Increase (Decrease)			Six Months Ended June 30,								Percent Increase (Decrease)
Segment and Consolidated Operating Results (in thousands):		2022				2021							2022				2021
Healthcare:
Revenues		$	128,474			$	114,750			12.0	%		$	250,350			$	210,725			18.8	%
Operating income		$	30,364			$	30,527			(0.5	)%		$	58,396			$	54,354			7.4	%
Segment operating margin			23.6	%			26.6	%						23.3	%			25.8	%
Education:
Revenues		$	88,225			$	60,475			45.9	%		$	168,887			$	111,817			51.0	%
Operating income		$	21,691			$	14,142			53.4	%		$	35,997			$	22,679			58.7	%
Segment operating margin			24.6	%			23.4	%						21.3	%			20.3	%
Commercial:
Revenues		$	56,626			$	54,901			3.1	%		$	114,137			$	110,797			3.0	%
Operating income		$	11,915			$	11,040			7.9	%		$	24,129			$	20,890			15.5	%
Segment operating margin			21.0	%			20.1	%						21.1	%			18.9	%
Total Huron:
Revenues		$	273,325			$	230,126			18.8	%		$	533,374			$	433,339			23.1	%
Reimbursable expenses			7,492				3,252			130.4	%			12,218				5,186			135.6	%
Total revenues and reimbursable expenses		$	280,817			$	233,378			20.3	%		$	545,592			$	438,525			24.4	%
Segment operating income		$	63,970			$	55,709			14.8	%		$	118,522			$	97,923			21.0	%
Items not allocated at the segment level:
Other operating expenses			29,912				34,325			(12.9	)%			63,460				63,134			0.5	%
Depreciation and amortization			5,054				5,255			(3.8	)%			10,100				10,420			(3.1	)%
Total operating income			29,004				16,129			79.8	%			44,962				24,369			84.5	%
Other income (expense), net			(7,327	)			122			N/M				14,842				(1,177	)		N/M
Income before taxes		$	21,677			$	16,251			33.4	%		$	59,804			$	23,192			157.9	%
Other Operating Data:
Number of revenue-generating professionals by segment (at period end)(1)(6):
Healthcare			1,619				1,443			12.2	%			1,619				1,443			12.2	%
Education			1,407				885			59.0	%			1,407				885			59.0	%
Commercial (2)			1,217				1,131			7.6	%			1,217				1,131			7.6	%
Total			4,243				3,459			22.7	%			4,243				3,459			22.7	%
Revenue by capability:
Consulting and Managed Services (3)		$	147,871			$	145,004			2.0	%		$	298,455			$	267,555			11.5	%
Digital			125,454				85,122			47.4	%			234,919				165,784			41.7	%
Total		$	273,325			$	230,126			18.8	%		$	533,374			$	433,339			23.1	%
Number of revenue-generating professionals by capability (at period end)(1):
Consulting and Managed Services (4)			2,018				1,736			16.2	%			2,018				1,736			16.2	%
Digital			2,225				1,723			29.1	%			2,225				1,723			29.1	%
Total			4,243				3,459			22.7	%			4,243				3,459			22.7	%
Utilization rate by capability(5):
Consulting			73.2	%			74.6	%						72.4	%			70.5	%
Digital			74.3	%			73.2	%						73.6	%			72.3	%

(1)		Consists of our full-time consultants who generate revenues based on the number of hours worked; full-time equivalents, which consists of coaches and their support staff within the Culture and Organizational excellence solution, consultants who work variable schedules as needed by clients, and full-time employees who provide software support and maintenance services to clients; and our Healthcare Managed Services employees who provide revenue cycle billing, collections insurance verification and change integrity services to clients.
(2)		The majority of our revenue-generating professionals within our Commercial segment can provide services across all of our industries, including healthcare and education.
(3)		Managed Services capability revenue within our Healthcare segment was $16.1 million and $14.0 million for the three months ended June 30, 2022 and 2021, respectively; and $29.9 million and $21.6 million for the six months ended June 30, 2022 and 2021, respectively.
		Managed Services capability revenue within our Education segment was $3.9 million and $2.3 million for the three months ended June 30, 2022 and 2021, respectively; and $7.3 million and $4.5 million for the six months ended June 30, 2022 and 2021, respectively.
(4)		The number of Managed Services revenue-generating professionals within our Healthcare segment as of June 30, 2022 and June 30, 2021 was 504 and 448, respectively.
		The number of Managed Services revenue-generating professionals within our Education segment as of June 30, 2022 and June 30, 2021 was 96 and 51, respectively.
(5)		Utilization rate is calculated by dividing the number of hours our billable consultants worked on client assignments during a period by the total available working hours for these billable consultants during the same period. Available hours are determined by the standard hours worked by each billable consultant, adjusted for part-time hours, and U.S. standard work weeks. Available working hours exclude local country holidays and vacation days. Utilization rates are presented for our revenue-generating professionals who primarily bill on an hourly basis. We have not presented utilization rates for our Managed Services professionals as most of the revenues generated by these employees are not billed on an hourly basis.
(6)		During the first quarter of 2022, we reclassified certain Digital revenue-generating professionals within our Healthcare and Education segments to our Commercial segment as these professionals can provide services across all of our industries. This reclassification did not impact the total headcount within our Digital capability for any period. The prior period headcount has been revised for consistent presentation.
N/M - Not Meaningful

HURON CONSULTING GROUP INC. RECONCILIATION OF NET INCOME TO ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (7) (In thousands) (Unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2022				2021				2022				2021
Revenues	$	273,325			$	230,126			$	533,374			$	433,339
Net income	$	13,875			$	12,797			$	40,727			$	18,202
Add back:
Income tax expense		7,802				3,454				19,077				4,990
Interest expense, net of interest income		2,446				2,029				4,642				3,748
Depreciation and amortization		7,097				6,555				14,219				13,106
Earnings before interest, taxes, depreciation and amortization (EBITDA) (7)		31,220				24,835				78,665				40,046
Add back:
Restructuring charges		2,069				861				3,624				1,489
Other losses		21				—				33				42
Transaction-related expenses		—				(29	)			50				141
Unrealized gain on preferred stock investment		—				—				(26,964	)			—
Foreign currency transaction losses (gains), net		(100	)			(48	)			(81	)			355
Adjusted EBITDA (7)	$	33,210			$	25,619			$	55,327			$	42,073
Adjusted EBITDA as a percentage of revenues (7)		12.2	%			11.1	%			10.4	%			9.7	%

HURON CONSULTING GROUP INC. RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME (7) (In thousands, except per share amounts) (Unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2022				2021				2022				2021
Net income	$	13,875			$	12,797			$	40,727			$	18,202
Weighted average shares - diluted		20,967				21,871				21,047				22,105
Diluted earnings per share	$	0.66			$	0.59			$	1.94			$	0.82
Add back:
Amortization of intangible assets		2,818				2,289				5,678				4,688
Restructuring charges		2,069				861				3,624				1,489
Other losses		21				—				33				42
Transaction-related expenses		—				(29	)			50				141
Unrealized gain on preferred stock investment		—				—				(26,964	)			—
Tax effect of adjustments		(1,301	)			(827	)			4,658				(1,685	)
Total adjustments, net of tax		3,607				2,294				(12,921	)			4,675
Adjusted net income (7)	$	17,482			$	15,091			$	27,806			$	22,877
Adjusted weighted average shares - diluted		20,967				21,871				21,047				22,105
Adjusted diluted earnings per share (7)	$	0.83			$	0.69			$	1.32			$	1.03

(7)

In evaluating the company’s financial performance and outlook, management uses earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA, adjusted EBITDA as a percentage of revenues, adjusted net income, and adjusted diluted earnings per share, which are non-GAAP measures. Management uses these non-GAAP financial measures to gain an understanding of the company's comparative operating performance (when comparing such results with previous periods or forecasts). These non-GAAP financial measures are used by management in their financial and operating decision making because management believes they reflect the company's ongoing business in a manner that allows for meaningful period-to-period comparisons. Management also uses these non-GAAP financial measures when publicly providing the company's business outlook, for internal management purposes, and as a basis for evaluating potential acquisitions and dispositions. Management believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Huron’s current operating performance and future prospects in the same manner as management does, if they so choose, and in comparing in a consistent manner Huron’s current financial results with Huron’s past financial results. Investors should recognize that these non-GAAP measures might not be comparable to similarly titled measures of other companies. These measures should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flows or liquidity prepared in accordance with accounting principles generally accepted in the United States.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220728005192/en/

MEDIA CONTACT

Allie Bovis

abovis@hcg.com

INVESTOR CONTACT

John D. Kelly

investor@hcg.com

Source: Huron

FAQ

What were Huron's Q2 2022 earnings results?

Huron reported Q2 2022 revenues of $273.3 million, net income of $13.9 million, and diluted EPS of $0.66.

How did Huron's revenues perform in the first half of 2022?

For the first six months of 2022, Huron's revenues increased by 23.1% to $533.4 million compared to the same period last year.

What is Huron's adjusted EBITDA for Q2 2022?

Huron's adjusted EBITDA for Q2 2022 was $33.2 million, reflecting a 29.6% increase year-over-year.

What is Huron's guidance for full-year 2022 revenues?

Huron revised its full-year revenue guidance to a range of $1.04 billion to $1.08 billion.

How many shares did Huron repurchase in Q2 2022?

Huron repurchased 0.5 million shares of common stock for $28.3 million in Q2 2022.