February 24, 2014
MIAMI, FL - February 24, 2014 - The Hackett Group, Inc. (NASDAQ: HCKT), a global strategic advisory and business transformation and technology consulting firm, today announced its financial results for the fourth quarter and fiscal year 2013, which ended December 27, 2013.
Fourth quarter 2013 revenue was $52.6 million, down 4% from prior year. Pro forma diluted earnings per share were $0.08, down 27% when compared to $0.11 for the same period in 2012. Fiscal year 2013 revenue was $223.8 million, slightly up from fiscal year 2012 revenue of $222.7 million. Fiscal year pro forma diluted earnings per share were $0.41, as compared to $0.40 in fiscal year 2012. Pro forma information is provided to enhance the understanding of the Company's financial performance and is reconciled to the Company's GAAP information in the accompanying tables.
GAAP diluted earnings per share was $0.04 for the fourth quarter of 2013, as compared to $0.21 in the same period in 2012, which included a $0.13 benefit from tax valuation allowances. GAAP diluted earnings per share in fiscal 2013 was $0.27, as compared to $0.50 in the previous fiscal year, which included a $0.20 benefit from tax valuation allowances. No deferred tax valuation allowance was released in 2013.
At the end of the fourth quarter of 2013, the Company's cash balances were $18.6 million. During the fourth quarter, the Company paid its annual $0.10 per share dividend. In addition, during the fourth quarter, the Company borrowed a net of $4.0 million on its credit facility to finance its Dutch tender offer and other share repurchases, leaving a $19.0 million balance at quarter end.
Including shares repurchased in the tender offer during the fourth quarter of 2013, the Company repurchased approximately 1.9 million shares of its common stock at an average of $6.53 per share, for a total cost of $12.3 million. As of fiscal year end 2013, the Company's remaining stock repurchase program authorization was $4.6 million. Subsequent to year end, the Company's Board of Directors approved to increase the stock repurchase program authorization by an additional $5.0 million.
"The significant decrease in our European revenues in the quarter, offset the solid growth in our US business and negatively impacted our fourth quarter and year end results," stated Ted A. Fernandez, Chairman & CEO of The Hackett Group, Inc. "Although we have taken actions to strengthen our European operations, we will continue to make the necessary changes, in order to recapture our momentum and contribution in the region."
Based on the current economic outlook, the Company estimates total revenue for the first quarter of 2014 to be in the range of $51.0 million to $53.0 million, and estimates pro forma diluted earnings per share to be in the range of $0.06 to $0.07.
World-Class IT Research - The Hackett Group's research details how top-performing IT organizations focus on automation and complexity reduction as essential IT strategy elements. This research from The Hackett Group found that world-class IT organizations achieve higher levels of effectiveness, meeting ROI expectations nearly twice as often, and support up to 80% higher levels of business process automation, all at 15% less cost than typical companies. The research also spotlights four fundamental practices that differentiate world-class IT organizations from typical companies.
Finance - Ambition vs Reality Research - In early February, The Hackett Group issued research showing that while most corporate finance organizations say they are highly committed to moving to global standards, more than half are failing to see success in this area. Over the past two years, minimal improvements have occurred at typical companies, and most dramatically underestimate the commitment required to execute on this key finance strategy and achieve true transformation, The Hackett Group's research found. The new findings are drawn from The Hackett Group's 2013 Global Finance Organization Model Study. In order to affect change, The Hackett Group's research recommends that companies more effectively prioritize transformation projects, create teams dedicated to change, and focus on developing the skills required to support a globalized operating model.
On Monday, February 24, 2014, senior management will discuss fourth quarter results in a conference call at 5:00 P.M. ET.
The number for the conference call is (800) 779-3138, [Passcode: Fourth Quarter, Leader: Ted A. Fernandez]. For International callers, please dial (517) 308-9381.
Please dial in at least 5-10 minutes prior to start time. If you are unable to participate on the conference call, a rebroadcast will be available beginning at 8:00 P.M. ET on Monday, February 24, 2014 and will run through 5:00 P.M. ET on Monday, March 10, 2014. To access the rebroadcast, please dial(866) 505-9257. For International callers, please dial (203) 369-1881.
In addition, The Hackett Group will also be webcasting this conference call live through the StreetEvents.com service. To participate, simply visit http://www.thehackettgroup.com approximately 10 minutes prior to the start of the call and click on the conference call link provided. An online replay of the call will be available after 8:00 P.M. ET on Monday, February 24, 2014 and will run through 5:00 P.M. ET on Monday, March 10, 2014. To access the replay, visit http://www.thehackettgroup.com or http://www.streetevents.com.
The Hackett Group (NASDAQ: HCKT) is an intellectual property-based strategic consultancy and leading enterprise benchmarking and best practices implementation firm to global companies, offering digital transformation and enterprise application approaches including a robotic process automation and cloud computing. Services include business transformation, enterprise performance management, working capital management and global business services. The Hackett Group also provides dedicated expertise in business strategy, operations, finance, human capital management, strategic sourcing, procurement and information technology, including its award-winning Oracle EPM and SAP practices.
The Hackett Group has completed more than 13,000 benchmarking studies with major corporations and government agencies, including 93% of the Dow Jones Industrials, 87% of the Fortune 100, 87% of the DAX 30 and 58% of the FTSE 100. These studies drive its Best Practice Intelligence Center™ which includes the firm's benchmarking metrics, best practices repository and best practice configuration guides and process flows, which enable The Hackett Group's clients and partners to achieve world-class performance.
This press release contains "forward-looking statements" and involves known and unknown risks, uncertainties and other factors that may cause The Hackett Group's actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. Factors that impact such forward-looking statements include, among others, the ability of our products, services, or practices mentioned in this release to deliver the desired effect, our ability to effectively integrate acquisitions into our operations, our ability to retain existing business, our ability to attract additional business, our ability to effectively market and sell our product offerings and other services, the timing of projects and the potential for contract cancellations by our customers, changes in expectations regarding the business consulting and information technology industries, our ability to attract and retain skilled employees, possible changes in collections of accounts receivable due to the bankruptcy or financial difficulties of our customers, risks of competition, price and margin trends, foreign currency fluctuations, changes in general economic conditions and interest rates and our ability to obtain debt financing through additional borrowings under an amendment to our existing credit facility, as well as other risks detailed in our reports filed with the SEC. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
More information on The Hackett Group is available: by phone at +1 770 225 7300; by e-mail at email@example.com.