CRA International's Q4 2024: Unpacking Contradictions in Utilization Rates, Antitrust Growth, and Legal Services
Earnings DecryptThursday, Feb 20, 2025 7:50 pm ET
4min read
These are the key contradictions discussed in CRA International's latest 2024 Q4 earnings call, specifically including: Utilization Rate Trends, Antitrust & Competition Economics Growth, and Legal & Regulatory Services Growth:
Record Revenue and Profitability:
- Charles River Associates (CRA) reported record revenue of $687.4 million for fiscal 2024, marking the seventh consecutive year of record annual revenue, with a 10.2% increase year-over-year.
- The growth was driven by Legal and Regulatory Services, which saw a 12% increase, and the strong performance of six practices that grew their top lines with double-digit revenue growth.
Legal and Regulatory Services Expansion:
- Revenue from Legal and Regulatory Services increased by approximately 7% in Q4, surpassing market growth rates.
- The increase was led by Finance and Intellectual Property practices, which delivered more than 20% year-over-year growth.
- CRA's Antitrust & Competition Economics practice contributed significantly, working on high-profile transactions like Novo Holdings' acquisition of Catalent.
Strong Utilization and Headcount Management:
- CRA ended the year with a consulting headcount of 946, a 5.8% decrease from the previous year, and a firm-wide utilization rate of 78%, up from 73% the prior year.
- This was due to strategic adjustments aimed at optimizing capacity and addressing market disruptions.
Strong Cash Flow and Capital Allocation:
- CRA's adjusted net cash flows from operations increased by 13% year-over-year to $92.5 million in fiscal 2024.
- The company converted 102% of its non-GAAP EBITDA into adjusted net cash flows, with significant capital returns to shareholders through dividends and share repurchases, totaling $45.6 million for the year.
Record Revenue and Profitability:
- Charles River Associates (CRA) reported record revenue of $687.4 million for fiscal 2024, marking the seventh consecutive year of record annual revenue, with a 10.2% increase year-over-year.
- The growth was driven by Legal and Regulatory Services, which saw a 12% increase, and the strong performance of six practices that grew their top lines with double-digit revenue growth.
Legal and Regulatory Services Expansion:
- Revenue from Legal and Regulatory Services increased by approximately 7% in Q4, surpassing market growth rates.
- The increase was led by Finance and Intellectual Property practices, which delivered more than 20% year-over-year growth.
- CRA's Antitrust & Competition Economics practice contributed significantly, working on high-profile transactions like Novo Holdings' acquisition of Catalent.
Strong Utilization and Headcount Management:
- CRA ended the year with a consulting headcount of 946, a 5.8% decrease from the previous year, and a firm-wide utilization rate of 78%, up from 73% the prior year.
- This was due to strategic adjustments aimed at optimizing capacity and addressing market disruptions.
Strong Cash Flow and Capital Allocation:
- CRA's adjusted net cash flows from operations increased by 13% year-over-year to $92.5 million in fiscal 2024.
- The company converted 102% of its non-GAAP EBITDA into adjusted net cash flows, with significant capital returns to shareholders through dividends and share repurchases, totaling $45.6 million for the year.
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