Press Release

Navigant Consulting, Inc. Announces Second Quarter 2008 Financial Results

July 31, 2008 at 4:32 PM EDT

CHICAGO, Jul 31, 2008 (BUSINESS WIRE) -- Navigant Consulting, Inc. (NYSE:NCI), a global consulting firm providing dispute, investigative, operational, risk management and financial and regulatory advisory solutions, today announced financial results for the second quarter ended June 30, 2008.

"We had a strong second quarter with record revenues and continued improved margins," commented William M. Goodyear, Chairman and Chief Executive Officer. "Company wide utilization of 79% was very gratifying, reflecting solid demand across most of our markets. The May 1st closing of our acquisition of Chicago Partners went smoothly and we are off to an excellent start in leveraging the skills and resources that this group brings to Navigant. Overall we are very pleased with our results for the first half of the year. As we look toward the second half of the year, we continue to focus on both the opportunities and the challenges posed by the ongoing and intensifying disruptions in the global financial markets."

Second Quarter 2008 Overview

The Company's second quarter 2008 results are summarized as follows:

              Second Quarter 2008 Financial Results (1)
----------------------------------------------------------------------
                          Q2 2008  Q1 2008  % Change Q2 2007  % Change
----------------------------------------------------------------------
Total Revenues ($000)     $211,408 $207,139     2.1% $189,633    11.5%
----------------------------------------------------------------------
Adjusted EBITDA ($000)     $34,462  $33,208     3.8%  $29,657    16.2%
----------------------------------------------------------------------
EBITDA ($000)              $32,507  $32,558    -0.2%  $29,657     9.6%
----------------------------------------------------------------------
EPS                          $0.21    $0.23    -8.7%    $0.21     0.0%
----------------------------------------------------------------------
Adjusted EPS                 $0.24    $0.25    -4.0%    $0.21    14.3%
----------------------------------------------------------------------
Average Billable FTEs        1,916    1,913     0.2%    1,890     1.4%
----------------------------------------------------------------------
End of Period Billable
 FTEs                        1,928    1,896     1.7%    1,907     1.1%
----------------------------------------------------------------------
Consultant Utilization
 (1,850 base)                  79%      83%    -4.8%      77%     2.6%
----------------------------------------------------------------------
Average Bill Rate
 (excluding success fees)      266      254     4.7%      236    12.7%
----------------------------------------------------------------------
DSO                             85       83     2.4%       87    -2.3%
----------------------------------------------------------------------

(1) See the attached schedules for a reconciliation of Adjusted EBITDA and Adjusted EPS to the GAAP financial results.

"The Disputes and Investigative Services segment had a solid quarter and we experienced continued growth in the International Consulting segment," stated Julie M. Howard, President and Chief Operating Officer. "The Business Consulting segment's performance was steady, reflecting strong demand for our Healthcare and Energy services, offset by lower discretionary consulting spending in the Financial Services and Insurance industries. We remain focused on leveraging uncommon combinations of our capabilities to address emerging client needs. The addition of our Economic Consulting Services segment further advances this strategy."

The Company's year-to-date 2008 financial results are summarized as follows:

               Year-to-Date 2008 Financial Results (1)
----------------------------------------------------------------------
                                       YTD 2008   YTD 2007   % Change
----------------------------------------------------------------------
Total Revenues ($000)                   $418,547   $372,923      12.2%
----------------------------------------------------------------------
Adjusted EBITDA ($000)                   $67,670    $58,858      15.0%
----------------------------------------------------------------------
EBITDA ($000)                            $65,065    $57,581      13.0%
----------------------------------------------------------------------
EPS                                        $0.44      $0.41       7.3%
----------------------------------------------------------------------
Adjusted EPS                               $0.49      $0.43      14.0%
----------------------------------------------------------------------

(1) See the attached schedules for a reconciliation of Adjusted EBITDA and Adjusted EPS to the GAAP financial results.

Second Quarter 2008 Business Segment Highlights

The Company's North American Business Consulting segment produced second quarter 2008 revenues of $92.0 million, a decrease of 2% over second quarter 2007. Heightened demand continued for the segment's Energy and Healthcare services, which positively impacted the segment's second quarter results. The firm's Energy expertise continues to be sought after as the impact of the 2007 Energy Act permeates the marketplace. Additionally, private investor interest and new energy related policies and regulations are further escalating the need for Navigant's services in the energy industry.

Navigant Healthcare professionals are seeing an increase in business generated by health facilities and systems seeking cost structure improvements and financial and operational enhancements. The combined Energy and Healthcare successes served to largely offset the softness in discretionary spending related to the Company's domestic Financial Services and Insurance practices. Both practices are shifting their portfolio of offerings in response to changing market conditions to respond to higher priority demand drivers such as regulatory mandates, risk management, operational efficiencies and cost reductions.

The North American Disputes and Investigative Services segment achieved second quarter 2008 revenues of $88.6 million, an increase of 10% over second quarter 2007, but down modestly from first quarter's exceptionally strong performance which benefited from a number of large, active assignments that were pressing toward trials. The Company remains well positioned to capitalize on the dispute and investigative needs created by the global regulatory and economic environment. The crisis in the global credit and housing markets continues to generate demand for the Company's accounting, financial, economic and industry expertise.

Navigant's International Consulting Operations segment reported second quarter 2008 revenues of $23.1 million, an increase of 60% over second quarter 2007. The segment's impressive growth reflects the favorable combination of acquisitions made in 2007 and demand for their extensive expertise and experience in large, international infrastructure disputes.

The Company's new Economics Consulting Services segment (reflecting the acquisition of Chicago Partners on May 1, 2008) performed as expected, reporting revenues of $7.7 million for the second quarter 2008. The practice's prominence in antitrust related engagements continued to drive revenues. Additionally, during the second quarter the segment began to see substantial traction related to the credit crisis. This trend is expected to continue during the second half of the year and to generate cross practice opportunities across the Company.

A Company metrics summary including data by segment is available on Navigant's website (www.navigantconsulting.com) under the Investor Relations section.

Web Cast of the Company's Announcement of Second Quarter 2008 Results

A web cast of management's presentation of the Company's second quarter 2008 financial results will be available on Navigant's website (www.navigantconsulting.com) under the Investor Relations section. A replay of the web cast will be available for approximately 90 days.

About Navigant Consulting

Navigant Consulting, Inc. (NYSE: NCI) is a specialized independent consulting firm providing dispute, investigative, financial, operational and business advisory, risk management and regulatory advisory, and transaction advisory solution services to government agencies, legal counsel and large companies facing the challenges of uncertainty, risk, distress and significant change. The Company focuses on industries undergoing substantial regulatory or structural change and on the issues driving these transformations. "Navigant" is a service mark of Navigant International, Inc. Navigant Consulting, Inc. (NCI) is not affiliated, associated, or in any way connected with Navigant International, Inc. and NCI's use of "Navigant" is made under license from Navigant International, Inc. More information about Navigant Consulting can be found at www.navigantconsulting.com.

Except as set forth below, statements included in this press release which are not historical in nature are forward-looking statements as defined within the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including "anticipates," "believes," "intends," "estimates," "expects" and similar expressions. These statements are based upon management's current expectations as of the date of this press release. The Company cautions readers that there may be events in the future that the Company is not able to accurately predict or control and the information contained in the forward-looking statements is inherently uncertain and subject to a number of risks that could cause actual results to differ materially from those indicated in the forward-looking statements including, without limitation: the success of the Company's organizational changes; risks inherent in international operations including foreign currency fluctuations; pace, timing and integration of acquisitions; management of professional staff, including dependence on key personnel, recruiting, attrition and the ability to successfully integrate new consultants into the Company's practices; utilization rates; dependence on the expansion of and the increase in the Company's service offerings and staff; conflicts of interest; potential loss of clients; risks inherent with litigation; significant client assignments; professional liability; potential legislative and regulatory changes; and general economic conditions. Further information on these and other potential factors that could affect the Company's financial results is included in the Company's filings with the SEC under the "Risk Factors" sections and elsewhere in those filings. The Company cannot guarantee any future results, levels of activity, performance or achievement and undertakes no obligation to update any of its forward-looking statements after the date of this press release.

              NAVIGANT CONSULTING, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF INCOME
                (In thousands, except per share data)
                             (Unaudited)


                                  For the quarter ended June 30, 2008
                                  -----------------------------------
                                    Adjusted   Adjustments  Reported
                                  -----------------------------------

Revenues before reimbursements       $189,385               $189,385
Reimbursements                         22,023                 22,023
                                  -----------------------------------
    Total revenues                    211,408        -       211,408

Cost of services before
 reimbursable expenses                113,852                113,852
Reimbursable expenses                  22,023                 22,023
                                  -----------------------------------
    Cost of services                  135,875        -       135,875
General and administrative
 expenses                              41,071                 41,071
Depreciation                            4,381                  4,381
Amortization                            4,597                  4,597
Other operating costs
    Office consolidation                    -    2,575         2,575

                                  -----------------------------------
    Operating income                   25,484   (2,575)       22,909
Interest expense, net                   5,393                  5,393
Other income                              (68)                   (68)
                                  ------------------------------------
Income before income tax expense       20,159   (2,575)       17,584
Income tax expense                      8,636   (1,038)        7,598
                                  -----------------------------------
    Net income                        $11,523  ($1,537)       $9,986
                                  ===================================

Net income per diluted share            $0.24                  $0.21
                                  ===================================

Shares used in computing net
 income per diluted share              48,257                 48,257

Percentage of revenues before
 reimbursements :
----------------------------------
Cost of services before
 reimbursable expenses                     60%                    60%
Reimbursable expenses                      12%                    12%
General and administrative
 expenses                                  22%                    22%

EBITDA (2)                                 18%                    17%
Operating income                           13%                    12%
Net income                                  6%                     5%


EBITDA (2) reconciliation:
    EBITDA (2)                        $34,462  ($1,955)(1)   $32,507
    Depreciation                        4,381                  4,381
    Accelerated Depreciation -
     Office consolidation                   -     (620)          620
    Amortization                        4,597                  4,597
                                  -----------------------------------
    Operating income                  $25,484  ($2,575)      $22,909
                                  ===================================




                                  For the quarter ended June 30, 2007
                                  ------------------------------------
                                    Adjusted   Adjustments  Reported
                                  ------------------------------------

Revenues before reimbursements       $169,650                $169,650
Reimbursements                         19,983                  19,983
                                  ------------------------------------
    Total revenues                   $189,633        -       $189,633

Cost of services before
 reimbursable expenses                105,849                 105,849
Reimbursable expenses                  19,983                  19,983
                                  ------------------------------------
    Cost of services                  125,832        -        125,832
General and administrative
 expenses                              34,144                  34,144
Depreciation                            3,995                   3,995
Amortization                            3,784                   3,784
Other operating costs
    Office consolidation                    -                       -

                                  ------------------------------------
    Operating income                   21,878        -         21,878
Interest expense, net                   2,325                   2,325
Other income                             (117)                   (117)
                                  ------------------------------------
Income before income tax expense       19,670        -         19,670
Income tax expense                      8,320        -          8,320
                                  ------------------------------------
    Net income                        $11,350        -        $11,350
                                  ====================================

Net income per diluted share            $0.21                   $0.21
                                  ====================================

Shares used in computing net
 income per diluted share              54,126                  54,126

Percentage of revenues before
 reimbursements :
----------------------------------
Cost of services before
 reimbursable expenses                     62%                     62%
Reimbursable expenses                      12%                     12%
General and administrative
 expenses                                  20%                     20%

EBITDA (2)                                 17%                     17%
Operating income                           13%                     13%
Net income                                  7%                      7%


EBITDA (2) reconciliation:
    EBITDA (2)                        $29,657        -        $29,657
    Depreciation                        3,995                   3,995
    Accelerated Depreciation -
     Office consolidation                   -                       -
    Amortization                        3,784                   3,784
                                  ------------------------------------
    Operating income                  $21,878        -        $21,878
                                  ====================================



(1) During the second quarter of 2008, the Company incurred office
     consolidation costs of $2.6 million associated with real estate
     rationalization, including lease termination costs and
     accelerated depreciation on certain leasehold improvements.

(2) EBITDA (earnings before interest, taxes, depreciation and
     amortization) is not a measure of financial performance under
     generally accepted accounting principles (GAAP). The Company
     believes EBITDA is useful supplemental information for investors
     to evaluate financial performance. This data is also used by the
     Company for assessment of its operating and financial results, in
     addition to operating income, net income and other GAAP measures.
     Management believes EBITDA is a useful indicator of the Company's
     financial and operating performance and its ability to generate
     cash flows from operations that are available for taxes and
     capital expenditures. Investors should recognize that EBITDA
     might not be comparable to similarly-titled measures of other
     companies. This measure should be considered in addition to, and
     not as a substitute for or superior to, any measure of
     performance prepared in accordance with GAAP.

              NAVIGANT CONSULTING, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF INCOME
                 (In thousands, except per share data)
                              (Unaudited)


                                       For the six months ended
                                             June 30, 2008
                                   ----------------------------------
                                    Adjusted   Adjustments  Reported
                                   ----------------------------------

Revenues before reimbursements       $373,679               $373,679
Reimbursements                         44,868                 44,868
                                   ----------------------------------
    Total revenues                   $418,547               $418,547

Cost of services before
 reimbursable expenses                226,925                226,925
Reimbursable expenses                  44,868                 44,868
                                   ----------------------------------
    Cost of services                  271,793                271,793
General and administrative expenses    79,084                 79,084
Depreciation                            8,546                  8,546
Amortization                            8,824                  8,824
Other operating costs
    Separation and Severance costs          -                      -
    Office consolidation                    -    4,093         4,093

                                   ----------------------------------
    Operating income                   50,300   (4,093)       46,207
Interest expense, net                   9,723                  9,723
Other income                              (63)                   (63)
                                   ----------------------------------
Income before income tax expense       40,640   (4,093)       36,547
Income tax expense                     17,306   (1,651)       15,655
                                   ----------------------------------
    Net income                        $23,334  ($2,442)      $20,892
                                   ==================================

Net income per diluted share            $0.49                  $0.44
                                   ==================================

Shares used in computing net income
 per diluted share                     47,548                 47,548

Percentage of revenues before
 reimbursements :
-----------------------------------
Cost of services before
 reimbursable expenses                     61%                    61%
Reimbursable expenses                      12%                    12%
General and administrative expenses        21%                    21%

EBITDA (3)                                 18%                    17%
Operating income                           13%                    12%
Net income                                  6%                     6%


EBITDA (3) reconciliation:
    EBITDA (3)                        $67,670  ($2,605)(1)   $65,065
    Depreciation                        8,546                  8,546
    Accelerated Depreciation -
     Office consolidation                   -   (1,488)        1,488
    Amortization                        8,824                  8,824
                                   ----------------------------------
    Operating income                  $50,300  ($4,093)      $46,207
                                   ==================================



                                        For the six months ended
                                              June 30, 2007
                                   -----------------------------------
                                    Adjusted   Adjustments  Reported
                                   -----------------------------------

Revenues before reimbursements       $334,488                $334,488
Reimbursements                         38,435                  38,435
                                   -----------------------------------
    Total revenues                   $372,923                $372,923

Cost of services before
 reimbursable expenses                207,083                 207,083
Reimbursable expenses                  38,435                  38,435
                                   -----------------------------------
    Cost of services                  245,518                 245,518
General and administrative expenses    68,547                  68,547
Depreciation                            7,716                   7,716
Amortization                            7,420                   7,420
Other operating costs
    Separation and Severance costs          -    1,277          1,277
    Office consolidation                    -        -              -

                                   -----------------------------------
    Operating income                   43,722   (1,277)        42,445
Interest expense, net                   3,167                   3,167
Other income                             (108)                   (108)
                                   -----------------------------------
Income before income tax expense       40,663   (1,277)        39,386
Income tax expense                     17,214     (515)        16,699
                                   -----------------------------------
    Net income                        $23,449    ($762)       $22,687
                                   ===================================

Net income per diluted share            $0.43                   $0.41
                                   ===================================

Shares used in computing net income
 per diluted share                     55,017                  55,017

Percentage of revenues before
 reimbursements :
-----------------------------------
Cost of services before
 reimbursable expenses                     62%                     62%
Reimbursable expenses                      11%                     11%
General and administrative expenses        20%                     20%

EBITDA (3)                                 18%                     17%
Operating income                           13%                     13%
Net income                                  7%                      7%


EBITDA (3) reconciliation:
    EBITDA (3)                        $58,858  ($1,277)(2)    $57,581
    Depreciation                        7,716                   7,716
    Accelerated Depreciation -
     Office consolidation                   -                       -
    Amortization                        7,420                   7,420
                                   -----------------------------------
    Operating income                  $43,722  ($1,277)       $42,445
                                   ===================================



(1) During the first six months of 2008, the Company incurred office
     consolidation costs of $4.1 million associated with real estate
     rationalization, including lease termination costs and
     accelerated depreciation on certain leasehold improvements.

(2) During the first quarter of 2007, the Company incurred realignment
     costs of $1.3 million associated with a management reorganization
     including severance.

(3) EBITDA (earnings before interest, taxes, depreciation and
     amortization) is not a measure of financial performance under
     generally accepted accounting principles (GAAP). The Company
     believes EBITDA is useful supplemental information for investors
     to evaluate financial performance. This data is also used by the
     Company for assessment of its operating and financial results, in
     addition to operating income, net income and other GAAP measures.
     Management believes EBITDA is a useful indicator of the Company's
     financial and operating performance and its ability to generate
     cash flows from operations that are available for taxes and
     capital expenditures. Investors should recognize that EBITDA
     might not be comparable to similarly-titled measures of other
     companies. This measure should be considered in addition to, and
     not as a substitute for or superior to, any measure of
     performance prepared in accordance with GAAP.

              NAVIGANT CONSULTING, INC. AND SUBSIDIARIES
       CONDENSED CONSOLIDATED BALANCE SHEETS AND SELECTED DATA
                   (In thousands, except DSO data)
                             (Unaudited)


                                 June      March   December    June
                                30, 2008  31, 2008  31, 2007  30, 2007
Assets
------------------------------ ---------------------------------------
Cash and cash equivalents        $10,320    $7,632   $11,656   $19,691
Trade accounts receivable, net   219,868   206,567   189,616   195,970
Prepaid and other assets          36,097    27,196    27,287    30,524
                               ---------------------------------------
 Total current assets            266,285   241,395   228,559   246,185

Property and equipment, net       49,473    52,129    54,687    58,872
Goodwill and intangible
 assets, net                     536,246   475,557   488,523   452,175
Other non-current assets, net     19,867     8,373     6,928     8,832
                               ---------------------------------------
 Total Assets                   $871,871  $777,454  $778,697  $766,064
                               =======================================

Liabilities and Stockholders'
 Equity
------------------------------

Bank debt                         $2,250    $2,250    $2,250    $2,250
Other current liabilities        130,393   105,382   124,269    99,292
Long term debt                   306,787   265,517   254,366   301,247
Other liabilities                 65,904    55,454    55,059    41,653
Stockholders' equity             366,537   348,851   342,753   321,622

                               ---------------------------------------
 Total Liabilities and
  stockholders' equity          $871,871  $777,454  $778,697  $766,064
                               =======================================



Selected Data

Days sales outstanding, net
 (DSO) (1)                            85        83        77        87
                               =======================================

1) Net of deferred revenue. June 30, 2008 DSO is calculated on a
 proforma basis as if Chicago Partners acquisition occurred April 1,
 2008.

                      NAVIGANT CONSULTING, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS
                           Dollars in 000s

                               For the three months For the six months
                                       ended               ended
                                     June 30,            June 30,
                               -------------------- ------------------
                                  2008      2007      2008     2007
                               ---------- --------- -------- ---------

Cash flows from operating
 activities:
Net income                        $9,986   $11,350  $20,892   $22,687
Adjustments to reconcile net
 income to net cash
provided by (used in)
 operating activities:
 Depreciation expense              5,001     3,995   10,034     7,716
 Amortization expense              4,597     3,784    8,824     7,420
 Stock-based compensation
  expense                          3,044     5,447    6,577     8,710
 Deferred income taxes            (5,101)      924   (4,579)    2,523
 Other, net                        7,538     2,385    9,799     5,370
 Changes in assets and
  liabilities                    (11,602)   (9,471) (52,115)  (43,505)

                               -------------------- ------------------
Net cash (used in) provided by
 operating activities             13,463    18,414     (568)   10,921
                               -------------------- ------------------

Cash flows from investing
 activities:
 Purchases of property and
  equipment                       (1,433)  (11,190)  (3,964)  (14,430)
 Acquisitions of businesses      (50,000)  (24,191) (50,000)  (37,925)
 Payments of acquisition
  liabilities                     (2,000)   (1,365)  (3,653)   (2,165)
 Other, net                         (352)   (2,042)    (352)   (1,269)

                               -------------------- ------------------
Net cash used in investing
 activities                      (53,785)  (38,788) (57,969)  (55,789)
                               -------------------- ------------------

Cash flows from financing
 activities:
 Issuances of common stock         1,515     2,142    4,078     5,569
 Repurchase of common
  stock/treasury stock                 -  (218,429)       -  (218,429)
 Proceeds from (Payments of)
  term loan                         (563)  225,000   (1,125)  225,000
 Borrowings from bank, net        41,847    11,140   53,599    40,903
 Other, net                          211      (961)     649      (229)

                               -------------------- ------------------
Net cash provided by financing
 activities                       43,010    18,892   57,201    52,814
                               -------------------- ------------------

Net increase (decrease) in
 cash and cash equivalents         2,688    (1,482)  (1,336)    7,946
Cash and cash equivalents at
 beginning of the period           7,632    21,173   11,656    11,745
                               -------------------- ------------------
Cash and cash equivalents at
 end of the period               $10,320   $19,691  $10,320   $19,691
                               ==================== ==================

SOURCE: Navigant Consulting, Inc.

Navigant Consulting, Inc. Jennifer Moreno Executive Director, Investor Relations 312.573.5634 jmoreno@navigantconsulting.com

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