CRA International Inc (CRAI) 2024 Q2 法說會逐字稿

Good day, everyone, and welcome to Charles River Associates second quarter 2024 conference call. Please note that today's conference is being recorded. The company's earnings release and prepared remarks from CRA's Chief Financial Officer are posted on the Investor Relations section of CRA's website at crai.com.

大家好，歡迎參加 Charles River Associates 2024 年第二季電話會議。請注意，今天的會議正在錄製中。該公司的盈利報告以及 CRA 首席財務官準備好的講話均發佈在 CRA 網站 crai.com 的投資者關係部分。

With us today are CRA's President and Chief Executive Officer, Paul Maleh; Chief Financial Officer, Dan Mahoney; and Chief Corporate Development Officer, Chad Holmes.

今天與我們在一起的有 CRA 總裁兼執行長 Paul Maleh；財務長丹·馬奧尼；和首席企業發展長查德霍姆斯。

At this time, I'd like to turn the call over to Mr. Mahoney for opening remarks. Dan, please go ahead.

現在，我想將電話轉交給馬奧尼先生致開幕詞。丹，請繼續。

Thank you, Rob, and good morning, everyone.

謝謝你，羅布，大家早安。

Please note that the statements made during this conference call, including guidance on future revenue and non-GAAP EBITDA margin and any other statements concerning the future business, operating results, or financial condition of CRA, including those statements using the terms expect, outlook, or similar terms are forward-looking statements as defined in Section 21 of the Exchange Act.

請注意，本次電話會議期間所做的聲明，包括有關未來收入和非 GAAP EBITDA 利潤率的指導，以及有關 CRA 未來業務、經營業績或財務狀況的任何其他聲明，包括使用預期、展望、或類似術語屬於《交易法》第21 條中定義的前瞻性陳述。

Information contained in these forward-looking statements is based on management's current expectations and is inherently uncertain. Actual performance and results may differ materially from those expressed or implied in these statements due to many important factors, including the level of demand for our services as a result of changes in general and industry-specific economic conditions.

這些前瞻性陳述中包含的資訊是基於管理階層目前的預期，本質上具有不確定性。由於許多重要因素，包括由於總體和特定行業經濟狀況的變化而導致對我們服務的需求水平，實際績效和結果可能與這些聲明中明示或暗示的結果存在重大差異。

Additional information regarding these factors is included in today's release and in CRA's periodic reports, including our most recently filed annual report on Form 10-K and quarterly reports on Form 10-Q filed with the SEC. CRA undertakes no obligation to update any forward-looking statements after the date of this call.

有關這些因素的更多資​​訊包含在今天的新聞稿和 CRA 的定期報告中，包括我們最近向 SEC 提交的 10-K 表年度報告和 10-Q 表季度報告。CRA 不承擔在本次電話會議之後更新任何前瞻性陳述的義務。

Additionally, we will refer to some non-GAAP financial measures and certain measures presented on a constant currency basis on this call. Everyone is encouraged to refer to today's release and related CFO remarks for reconciliations of these non-GAAP financial measures to their GAAP comparable measures and descriptions of the calculation of EBITDA and measures presented on a constant currency basis.

此外，我們將在本次電話會議上參考一些非公認會計準則財務指標和以固定匯率計算的某些指標。我們鼓勵大家參考今天的新聞稿和相關財務長的講話，以了解這些非公認會計準則財務指標與其公認會計準則可比指標的對賬，以及 EBITDA 計算和按固定匯率計算的指標的說明。

I will now turn it over to Paul for his report. Paul?

我現在將其交給保羅作報告。保羅？

Thanks, Dan, and good morning, everyone. Thank you for joining us today.

謝謝丹，大家早安。感謝您今天加入我們。

CRA continued its run of strong performance into the second quarter of fiscal 2024. Revenue increased by 5.9% year over year to $171.4 million. When combined with the first quarter, this represents the highest first half revenue in the company's history. During this period of growth, we have continued to manage the business effectively.

CRA 在 2024 財年第二季持續保持強勁業績。營收年增 5.9% 至 1.714 億美元。與第一季結合，這代表了該公司歷史上最高的上半年收入。在此增長時期，我們繼續有效地管理業務。

Consultant head count remained relatively flat compared to the second quarter of 2023, producing quarterly utilization of 74%. This solid utilization supported year-over-year growth in profitability as non-GAAP net income, earnings per diluted share, and EBITDA increased by 26.4%, 28.9%, and 18.5%, respectively.

與 2023 年第二季相比，顧問人數保持相對平穩，季度利用率為 74%。這種穩健的利用率支持了盈利能力的同比增長，非 GAAP 淨利潤、稀釋每股收益和 EBITDA 分別增長了 26.4%、28.9% 和 18.5%。

Broad-based contributions drove this strong quarterly performance with five practices growing year over year; antitrust & competition economics, financial economics, intellectual property, labor & employment, and life sciences. Both lines of business contributed to the quarter's revenue growth as legal and regulatory increased 7.2% year-over-year and management consulting expanded to 0.9% relative to the second quarter of fiscal 2023.

廣泛基礎的貢獻推動了這一強勁的季度業績，五項業務逐年增長；反壟斷與競爭經濟學、金融經濟學、智慧財產權、勞動與就業、生命科學。與 2023 財年第二季相比，法律和監管業務年增 7.2%，管理顧問業務成長至 0.9%，這兩個業務線都為本季的營收成長做出了貢獻。

For the company as a whole, we continue to replenish our sales pipeline. Our project lead flow increased in the second quarter by 11% year over year. CRA conversion rates remain strong and consistent with historical norms as new project originations grew by 18% relative to the second quarter of 2023. Even excluding projects that transition to CRA as part of the recent expansion of our intellectual property practice, new project originations still grew by 10% year over year. This performance outpaced the broader legal market, which saw total case filings increase by 7% year over year and total core judgments increased by 3%.

對於整個公司來說，我們繼續補充我們的銷售管道。第二季度我們的專案鉛流量較去年同期成長 11%。CRA 轉換率依然強勁，且與歷史正常水準一致，新專案啟動量較 2023 年第二季成長了 18%。即使不包括作為我們近期知識產權業務擴展一部分而過渡到 CRA 的項目，新項目的發起量仍同比增長 10%。這一表現超過了更廣泛的法律市場，案件申請總數同比增長 7%，核心判決總數增長 3%。

I would now like to spend a few minutes highlighting some of the projects delivered during the second quarter. Our antitrust & competition economics practice has been actively involved in a variety of high-profile litigation and regulatory matters. These cases range across industries, including technology, health insurance, hospitals, consumer goods, and home furnishings.

我現在想花幾分鐘重點介紹第二季交付的一些項目。我們的反壟斷和競爭經濟學業務一直積極參與各種備受矚目的訴訟和監管事務。這些案例涉及多個行業，包括科技、健康保險、醫院、消費品和家居。

Our team has successfully supported clients on intricate competition matters, helping them respond to a range of antitrust and damages claims. The practice also continued to assist clients involved in merger transactions. For example, during the second quarter, CRA experts supported the acquisition of Viatris' European over-the-counter business by Cooper Consumer Health. The CRA team prepared analysis assessing the horizontal overlaps and the closeness of competition of the parties' products across hundreds of markets.

我們的團隊成功地為客戶處理複雜的競爭事務提供支持，幫助他們應對一系列反壟斷和損害賠償索賠。該業務也繼續協助參與合併交易的客戶。例如，第二季度，CRA專家支持Cooper Consumer Health收購Viatris的歐洲非處方藥業務。CRA 團隊準備了分析，評估雙方產品在數百個市場中的橫向重疊和競爭的緊密程度。

With the exception of two products, the European Commission found that the overlaps did not result in any competition concerns. In addition, vertical and conglomerate concerns were also analyzed by the CRA team, with the commission concluding these did not result in any competition concerns.

除兩種產品外，歐盟委員會發現重疊並未導致任何競爭問題。此外，CRA 團隊還分析了垂直和集團問題，委員會得出的結論是，這些問題並未導致任何競爭問題。

During the second quarter, CRA's Financial Economics practice assisted numerous banks by providing statistical analysis of underwriting and pricing with respect to consumer products, including mortgages, auto loans, and credit cards. Additionally, the practice supplied analysis of the geographic distribution of mortgage applications and originations for several lenders dating back to 2016. These analyses were in response to investigations by the Department of Justice and Federal Financial Regulators, including the CFPB. Separately, the practice continued assisting clients by analyzing the imposition of overdraft fees and related remediation efforts.

第二季度，CRA 的金融經濟業務透過提供消費產品（包括抵押貸款、汽車貸款和信用卡）承保和定價的統計分析，為眾多銀行提供了幫助。此外，該實踐還對 2016 年以來多家貸款機構的抵押貸款申請和起源的地理分佈進行了分析。這些分析是對司法部和聯邦金融監管機構（包括 CFPB）調查的回應。另外，該部門也透過分析透支費的徵收和相關補救措施繼續為客戶提供協助。

Finally, CRA experts continue supporting multiple banks and litigation matters alleging discrimination of protected classes in the context of mortgage lending and FHA false claims actions. CRA's Intellectual Property practice advised on multiple high stakes litigation, arbitration, and valuation matters, covering a broad range of industries, including automotive, consumer electronics, e-commerce, energy, industrial products, life sciences, semiconductors, and software.

最後，CRA 專家繼續支持多家銀行和訴訟事務，指控抵押貸款和 FHA 虛假索賠行動中對受保護群體的歧視。CRA 的智慧財產權業務就多項高風險訴訟、仲裁和估值事宜提供諮詢，涵蓋廣泛的行業，包括汽車、消費性電子、電子商務、能源、工業產品、生命科學、半導體和軟體。

For example, CRA is retained on behalf of the plaintiffs in a high-profile Biologics Price Competition and Innovation Act patent litigation matter involving a treatment for age-related macular degeneration. Through written and oral testimony, CRA was asked to assess whether the branded manufacturer would suffer irreparable harm should the accused biosimilar manufacturers launch before the final resolution of the patent litigation. The District Court agreed with CRA's findings that there would be irreparable harm and granted injunctions preventing biosimilars from entering the market.

例如，CRA 代表原告處理備受矚目的《生物製品價格競爭和創新法》專利訴訟案件，涉及老年黃斑部病變的治療。透過書面和口頭證詞，CRA 被要求評估如果被指控的生物相似藥製造商在專利訴訟最終解決之前推出產品，品牌製造商是否會遭受不可挽回的損害。地方法院同意 CRA 的調查結果，即這將造成不可挽回的損害，並頒發禁令，阻止生物相似藥進入市場。

In early May, as previously announced, the Intellectual Property practice welcomed the addition of a 20-person team led by Chris Bakewell and Julia Rowe. The practice now has a significant footprint in Texas, which is the most active venue for patent litigation in the US. Integration of the two legacy teams is tracking to plan with cross staffing of client projects and joint marketing efforts well underway.

正如之前所宣布的，5 月初，智慧財產權業務迎來了由 Chris Bakewell 和 Julia Rowe 領導的 20 人團隊的加入。該業務目前在德克薩斯州佔有重要地位，該州是美國專利訴訟最活躍的場所。兩個遺留團隊的整合正在追蹤計劃，客戶專案的交叉人員配置和聯合行銷工作正在順利進行。

For example, the IP practices undertaking a cross-practice initiative with our forensic and energy practices to develop and participate in a new conference focused on trade secrets and cybersecurity. The conference is planned for the fourth quarter in Houston. Also during the second quarter, CRA's labor & employment practice continue to provide expert analysis for clients facing a multitude of employment-related litigation issues, including claims of employment discrimination and underpayment due to job misclassifications and off-the-clock allegations.

例如，智慧財產權業務與我們的法證和能源業務開展跨業務舉措，以製定並參加專注於商業機密和網路安全的新會議。會議計劃於第四季度在休士頓舉行。同樣在第二季度，CRA 的勞動和就業業務繼續為面臨大量就業相關訴訟問題的客戶提供專家分析，包括就業歧視索賠和因工作分類錯誤和非工作時間指控而導致的少付工資。

The practice regularly supports clients during the early litigation stages by assisting with court-ordered data collection. Experts across the practice also have been actively assisting clients prepare data and responses to audit requests made by the Office of Federal Contract Compliance Programs. CRA's life sciences practice continues to support strategies regarding the evolution of health care by working with a leading pharmaceutical company to build business cases for investing in a series of beyond-the-pill solutions with an emerging therapy in neuroimmunology space.

該業務部門定期在早期訴訟階段為客戶提供協助，協助收集法院命令的資料。該行業的專家也積極協助客戶準備數據並回應聯邦合約合規計畫辦公室提出的審計請求。CRA 的生命科學實踐繼續支持有關醫療保健發展的策略，與一家領先的製藥公司合作，建立商業案例，投資一系列神經免疫學領域新興療法的非藥物解決方案。

Regarding the practices expert witness work, we continue to support a large pharmacy benefit manager in a tax dispute with the US government regarding the role of claims adjudication and the generation of revenues and profits. We also continue our work in both the US and Canada regarding allegations of price fixing in generic pharmaceuticals.

在實踐專家證人工作方面，我們繼續為一家大型藥房福利管理公司提供支持，處理與美國政府有關索賠裁決的作用以及收入和利潤產生的稅務糾紛。我們也繼續在美國和加拿大針對仿製藥價格操縱指控開展工作。

Overall, I'm grateful to all my colleagues for their hard work during the second quarter as we helped our clients address their most important challenges. To recap, through the first two quarters of fiscal 2024, on a constant currency basis relative to fiscal 2023, CRA generated total revenue of $342.2 million and non-GAAP EBITDA of $44.5 million, achieving a margin of 13%.

總的來說，我感謝所有同事在第二季的辛勤工作，幫助我們的客戶解決了他們最重要的挑戰。回顧一下，在 2024 財年的前兩個季度，相對於 2023 財年，以固定匯率計算，CRA 的總營收為 3.422 億美元，非 GAAP EBITDA 為 4,450 萬美元，利潤率為 13%。

While pleased with the strong performance of the business, we took proactive steps during the quarter to further optimize our service portfolio by reconfiguring the consulting team in targeted areas of the company, which affected about half a dozen practices. As we have discussed over the past year, we have seen high retention rates within our consulting staff that have led to persistent pockets of overcapacity.

儘管對業務的強勁表現感到滿意，但我們在本季度採取了積極措施，透過在公司目標領域重新配置諮詢團隊來進一步優化我們的服務組合，這影響了大約六個業務。正如我們在過去一年中討論的那樣，我們看到諮詢人員的高保留率導致了持續的產能過剩。

Normal operations and natural attrition rates helped to bring our delivery resources into better alignment with the demand for our services, but excess capacity remained in select practices. Following the conclusion of the optimization actions during the second quarter, we feel well positioned to continue the pursuit of profitable growth in the quarters ahead.

正常營運和自然損耗率有助於使我們的交付資源更好地滿足我們的服務需求，但在某些實踐中仍然存在產能過剩。在第二季優化行動結束後，我們感覺自己已經做好了在未來幾季繼續追求獲利成長的準備。

Turning to our financial guidance, reflecting the strong start of the year, we are increasing our revenue and profit guidance for full year fiscal 2024. On a constant currency basis relative to fiscal 2023, we expect revenue in the range of $670 million to $685 million and non-GAAP EBITDA margin in the range of 12.2% to 13.0%. This new guidance compares with prior revenue range of $645 million to $675 million and prior non-GAAP EBITDA margin range of 10.8% to 11.5%.

談到我們的財務指引，反映了今年的強勁開局，我們正在提高 2024 財年全年的收入和利潤指引。以相對於 2023 財年的固定匯率計算，我們預期營收將在 6.7 億至 6.85 億美元之間，非 GAAP EBITDA 利潤率將在 12.2% 至 13.0% 之間。與此新指引相比，先前的營收範圍為 6.45 億美元至 6.75 億美元，先前的非 GAAP EBITDA 利潤率範圍為 10.8% 至 11.5%。

With that, I'll turn the call over to Chad and then Dan for a few additional comments.

接下來，我將把電話轉給 Chad，然後轉給 Dan，徵求一些補充意見。

Chad?

查德?

Thanks, Paul. Hello, everyone. I want to update you on our capital deployment during the quarter. We concluded the quarter with $24.6 million of cash and $87 million of borrowings under our revolving credit facility, resulting in a net debt of $62.4 million. The borrowings were primarily to fund bonus payments during the first two quarters, which is consistent with our practice in prior years.

謝謝，保羅。大家好。我想向您介紹本季資本部署的最新情況。本季結束時，我們的循環信貸安排下擁有 2,460 萬美元現金和 8,700 萬美元借款，淨債務為 6,240 萬美元。這些借款主要用於支付前兩個季度的獎金，這與我們前幾年的做法一致。

In addition to the normal bonus cycle, the second quarter of 2024 also saw net cash outlays for talent investments of $18.6 million and capital expenditures of $2.3 million. We've also returned a total of $27.0 million to our shareholders during the second quarter, consisting of $2.9 million of dividend payments and $24.1 million for share repurchases of approximately 140,000 shares. We currently have $13.1 million available under our share repurchase program.

除了正常的獎金週期外，2024 年第二季人才投資的淨現金支出為 1,860 萬美元，資本支出為 230 萬美元。第二季我們也向股東返還了總計 2,700 萬美元的資金，其中包括 290 萬美元的股息支付和 2,410 萬美元的約 14 萬股股票回購。目前我們的股票回購計畫有 1,310 萬美元可用。

With that, I'll turn the call over to Dan for a few final comments.

至此，我會將電話轉給 Dan，徵求一些最後的意見。

Dan?

擔？

Thanks, Chad.

謝謝，查德。

As a reminder, more expansive commentary on our financial results is available on the Investor Relations section of our website under prepared CFO remarks. Before we get to questions, let me provide a few additional metrics related to our performance in the second quarter of fiscal 2024.

謹此提醒，我們網站投資者關係部分的財務長評論下方提供了有關我們財務表現的更廣泛的評論。在回答問題之前，讓我先提供一些與我們 2024 財年第二季業績相關的其他指標。

In terms of consultant headcount, we ended the quarter at 968, consisting of 157 officers, 531 other senior staff, and 280 junior staff. This represents a 0.3% decrease compared with the 971 consultant head count reported at the end of Q2 fiscal 2023.

就顧問人數而言，本季末我們有 968 名顧問，其中包括 157 名官員、531 名其他高級員工和 280 名初級員工。與 2023 財年第二季末報告的 971 名顧問人數相比，減少了 0.3%。

Non-GAAP selling, general, and administrative expenses, excluding the 2.2% attributable to commissions to nonemployee experts, was 16.4%, of revenue for the second quarter of fiscal 2024 compared with 16.1% a year ago. This quarter's ratio was primarily impacted by an increase in travel and entertainment expenses and higher labor costs. The effective tax rate for the second quarter of fiscal 2024 on a non-GAAP basis was 29.4% compared with 29.8% on a non-GAAP basis for the second quarter of fiscal 2023.

2024 財年第二季度，非 GAAP 銷售、一般及管理費用（不包括 2.2% 的非僱員專家佣金）佔營收的 16.4%，去年同期為 16.1%。本季的比率主要受到差旅和娛樂費用增加以及勞動成本上升的影響。以非公認會計原則計算，2024 財年第二季的有效稅率為 29.4%，而 2023 財年第二季以非公認會計原則計算的實際稅率為 29.8%。

Turning to the balance sheet, DSO at the end of the second quarter was 110 days compared with 115 days at the end of the second quarter of fiscal 2023. DSO in the second quarter consisted of 70 days of billed and 40 days of unbilled. We concluded the second quarter of fiscal 2024 with $24.6 million in cash and cash equivalents and a further $158.5 million of available capacity on our line of credit, for a total liquidity of $183.1 million.

轉向資產負債表，第二季末的 DSO 為 110 天，而 2023 財年第二季末為 115 天。第二季的 DSO 包括 70 天的計費天和 40 天的未計費天。截至 2024 財年第二季度，我們的現金和現金等價物為 2,460 萬美元，信貸額度還有 1.585 億美元的可用容量，流動性總額為 1.831 億美元。

That concludes our prepared remarks. We will now open the call for questions.

我們準備好的演講到此結束。我們現在開始提問。

Rob, please go ahead.

羅布，請繼續。

(Operator Instructions)

（操作員說明）

Marc Riddick, Sidoti & Company.

馬克·里迪克，西多蒂公司。

So I wanted to start with your comments around reconfiguring the team and how that dovetails into the increase of the full year guide, if we could spend some time there. With the pullback in the number -- the quarter ended head count though utilization was up -- can you talk -- maybe walk us through how you see that flowing for the remainder of the year as far as with the guidance that was provided?

因此，我想從您對重新配置團隊的評論開始，以及如何與全年指南的增加相吻合（如果我們可以在那裡花一些時間的話）。隨著數字的回落——儘管利用率有所上升，但季度末的員工人數——你能談談嗎——也許可以告訴我們，根據所提供的指導，你如何看待今年剩餘時間的情況？

Can you talk about maybe how that plays into where you see head count going and what your thoughts are around utilization for the remainder of the year? And then I have a follow-up after that.

您能否談談這對您認為員工人數的變化有何影響，以及您對今年剩餘時間的利用率有何看法？之後我會跟進。

Sure. Let me start with, I don't take the actions that we had to do during the second quarter lightly. It's been 12 years since I had to oversee such actions, and I really hope that I would never see that during my tenure. We set out about a year ago, and I was talking to all of our shareholders and said, I see some excess capacity. I thought normal paths of attrition would self-correct it as we move through the year. And what we saw is we had some correction to it, but we still had these pockets of excess capacity that existed across a number of practices. And we wanted to try to rightsize that.

當然。首先，我不會輕視我們在第二季必須採取的行動。自從我必須監督此類行動以來，已經過去了 12 年，我真的希望在我的任期內永遠不會看到這種情況。我們大約一年前出發，我與所有股東交談時說，我看到了一些產能過剩。我認為隨著這一年的推移，正常的消耗路徑會自我修正。我們看到的是，我們對其進行了一些修正，但我們在許多實踐中仍然存在一些過剩產能。我們想嘗試調整規模。

As we've repeated over and over, our goal is to operate in the mid-70s utilization. Clearly, there's some calendar cyclicality with the holidays. As we bring on new people, that utilization will move. But the long-term target is to be operating in the mid-70s utilization. The guidance that we have provided incorporates the actions and the associated savings that we have with those actions.

正如我們一再重複的，我們的目標是在 70 年代中期運作。顯然，假期有一定的日曆週期性。當我們引進新員工時，利用率將會改變。但長期目標是在 70 年代中期營運利用率。我們提供的指導包含了我們採取的行動以及透過這些行動所節省的相關費用。

The one thing to say is that, there's a lot of moving parts that go into coming up with the guidance. We are not staying put. We are still hiring people. We're still growing revenue. We are still looking for ways to expand or increase the depth of our services. So it is not as simple as looking at the labor savings associated with the action and just playing it forward over the next couple of quarters.

需要說的一件事是，制定指南需要考慮很多變化因素。我們不會原地踏步。我們仍在招募人員。我們的收入仍在成長。我們仍在尋找擴大或增加我們服務深度的方法。因此，這並不像查看與該行動相關的勞動力節省並在接下來的幾個季度繼續實施那麼簡單。

So we feel good about where we stand. The guidance is coming off of record profitability over those six months. And the good news is that combined with the strength of the portfolio and the actions, I think we're going to be able to continue that momentum ahead.

所以我們對自己的立場感覺良好。該指引是在這六個月內創紀錄的獲利能力的基礎上實現的。好消息是，結合投資組合和行動的實力，我認為我們將能夠繼續保持這種勢頭。

I appreciate the commentary. And then you did mention as far as new project originations being a very strong -- quite strongly, lead flow looks very good. Can you talk a little bit about what you're seeing conversion-wise through the quarter and maybe how you see that playing out in the near term?

我很欣賞你的評論。然後你確實提到，新專案的發起非常強勁——相當強勁，潛在客戶流看起來非常好。您能否談談您在整個季度中看到的轉換情況，以及您如何看待近期的情況？

Sure. I know we're supposed to be talking about the second quarter of fiscal 2024, but I'm going to take us back through 2023. 2023 was a good year except for the conversion of those leads that we were bringing into CRA into revenue-generating projects. We saw a lot of volatility on that conversion rate.

當然。我知道我們應該討論 2024 財年第二季度，但我要回顧 2023 年。我們看到轉換率有很大的波動。

We are very pleased with the level of leads during 2023. What we've been enjoying in Q4 of 2023, Q1 of fiscal '24 and Q2 of fiscal '24 are conversion rates that look like what we've enjoyed historically at CRA. So we are in that low-60s% conversion rate and that is nothing new for this portfolio of services. So we're pretty pleased. I see no indication of a shift or that volatility that we experienced during Q3 reemerging. So a lot of credit goes to my colleagues across the practices.

我們對 2023 年的銷售線索水準非常滿意。我們在 2023 年第四季、24 財年第一季和 24 財年第二季所享受到的轉換率與我們在 CRA 歷史上所享受的轉換率相似。因此，我們的轉換率只有 60%，這對該服務組合來說並不是什麼新鮮事。所以我們很高興。我沒有看到任何跡象表明我們在第三季經歷過的轉變或波動再次出現。因此，很多功勞都歸功於我的同事們的實踐。

Okay. Great. And then just maybe one more.

好的。偉大的。然後也許還有一個。

You've talked in the past about what you're seeing as far as the regulatory landscape and increased scrutiny of transactions and the like. So maybe if you can maybe just provide an update because it certainly seems to be continuing to play out? Maybe you can give us maybe an update on your views on that?

您過去曾談到您所看到的監管環境和加強交易審查等方面的情況。那麼，也許您可以提供更新，因為它肯定會繼續發揮作用？也許您可以向我們提供您對此的最新看法？

Yeah. We see no shift right now, both here in the States and in Europe. We see regulatory oversight to still be relatively strong. And we're all trying to read the tea leaves of what a continued administration or a new administration may mean here. But right now, no indication of a slowdown in terms of the regulatory pressures companies are facing.

是的。目前，無論是在美國還是在歐洲，我們都沒有看到任何變化。我們認為監管監督仍然相對較強。我們都在努力了解繼續執政或新政府在這裡可能意味著什麼。但目前，沒有跡象顯示公司面臨的監管壓力有所放緩。

Andrew Nicholas, William Blair.

安德魯尼古拉斯、威廉布萊爾。

I wanted to touch first on the margin guide, which I think at the midpoint would represent, if it's not the strongest margin here ever, I mean, it certainly is in the numbers that I have. So I understand there's some portfolio optimization actions and restructuring that you enacted. But could you maybe unpack what's making this year such a profitable one? Utilization is certainly strong, but I wouldn't say outside of your normal range of expectation. And then relatedly, is this a decent jumping off point for future years? Or is there anything going on in '24 that is onetime in nature?

我想先談談利潤率指南，我認為中點代表著，如果它不是有史以來最強的利潤率，我的意思是，它肯定是在我擁有的數字中。據我了解，您採取了一些投資組合優化行動和重組措施。但您能解釋一下是什麼讓今年如此有利可圖嗎？利用率確實很高，但我不會說超出您的正常預期範圍。與此相關的是，這是未來幾年的一個不錯的起點嗎？還是24世紀發生了一些本質上是一次性的事情？

Sure. We're quite proud of our revenue growth and our ability to grow revenue at such a profitable rate. That has been our history now for more than a decade. We're able to grow the top line, we're able to grow it profitably and have also enjoyed substantive margin expansion since 2019.

當然。我們對我們的收入成長以及以如此高的利潤率成長收入的能力感到非常自豪。這就是我們十多年來的歷史。自 2019 年以來，我們能夠實現營收成長、獲利成長，且利潤率也實現了大幅成長。

If you compare, whether you want to look at EBITDA or EBITDA plus the forgivable loan amortization, we've improved margins by 250 basis points over these last four years. And we are always looking for the right opportunities to reinvest in the business, but there is nothing in 2024 that I would consider onetime in nature in terms of giving us a boost to profitability. This is really a continuation of the strong performance by this portfolio for many years and we're going to do our best to just grow wisely, right? I think that is one of the key ingredients of creating value for my colleagues here at CRA and our shareholders.

如果您進行比較，無論您想查看 EBITDA 還是 EBITDA 加上可寬恕的貸款攤銷，我們在過去四年中將利潤率提高了 250 個基點。我們一直在尋找合適的機會對業務進行再投資，但我認為 2024 年沒有任何事情可以一次提高我們的盈利能力。這確實是該投資組合多年來強勁表現的延續，我們將盡最大努力實現明智增長，對吧？我認為這是為 CRA 的同事和股東創造價值的關鍵因素之一。

Very helpful. Thank you.

非常有幫助。謝謝。

And then I wanted to ask on -- I know you've talked about this publicly in the past. But just with what's gone on politically over the past month, a lot of movement in terms of election expectations. Could you speak to your latest thoughts on what potential administration changes might mean for the business and maybe what you're baking in for the back half of the year in terms of any related pauses or delays in decision-making surrounding that event?

然後我想問——我知道你過去曾公開談論過這個問題。但就過去一個月的政治局勢而言，選舉預期已經發生了很大變化。您能否談談您對潛在的管理變化可能對業務意味著什麼的最新想法，以及您在今年下半年圍繞該事件的決策的任何相關暫停或延遲方面的準備？

Thank you.

謝謝。

Sure. It's definitely been must watch TV. There's always preconceived notions about a administration led by the Republican party or administration led by the Democratic Party based on past administrations. But the last time the Republican administration was in office didn't necessarily follow what I would call historical norms with it. So to say that, -- if there's a change in administration, would that be a dramatic change in regulation, and the question is -- the answer is, I don't know. I don't know whether they're going to follow closer to the actions taken during the last Republican administration or are we going to see a continuation if the Democrats maintain office and control.

當然。這絕對是必須看的電視。基於過去的政府，人們總是對共和黨領導的政府或民主黨領導的政府抱持先入為主的觀念。但共和黨政府上一次執政不一定遵循我所說的歷史規範。所以說，如果管理方面發生變化，監管方面是否會發生巨大變化，問題是，答案是，我不知道。我不知道他們是否會更接近上屆共和黨政府採取的行動，或者如果民主黨繼續執政和控制，我們是否會看到這種情況繼續下去。

The other thing to keep in mind is that we also don't see any real signs of easing of regulatory pressures in Europe. And we do operate in a global marketplace. So I'm personally curious to see if there is a relaxation of regulatory scrutiny here in the States, how much deviation are we going to see from what we have observed in Europe. So I haven't noticed that. Also to keep in mind is that if there is a change, it doesn't happen overnight. There's a lot of things that need to play through the system and a lot of changes that need to happen. So I, like you, am just watching closely.

另一件需要記住的事情是，我們也沒有看到歐洲監管壓力有任何放鬆的真正跡象。我們確實在全球市場中運作。因此，我個人很好奇美國是否放寬了監管審查，我們會看到與歐洲觀察到的情況有多大偏差。所以我還沒有註意到這一點。另外要記住的是，如果發生變化，也不會在一夜之間發生。有很多事情需要透過系統進行，並且需要發生很多變化。所以我和你一樣，只是密切注意。

Great. That's helpful.

偉大的。這很有幫助。

And then maybe if I could ask one last question on the antitrust business. You highlighted some wins in your prepared remarks, and I apologize if I missed it. But could you speak maybe more specifically to the performance between M&A and non-M&A-related antitrust in the quarter? Is there any major divergence in terms of the growth rates there or even sentiment as you look ahead over the next couple of quarters and into next year?

也許我可以問最後一個關於反壟斷業務的問題。您在準備好的發言中強調了一些勝利，如果我錯過了，我深表歉意。但您能否更具體地談談本季併購和非併購相關反壟斷之間的表現？當您展望未來幾季和明年時，成長率甚至情緒方面是否存在重大差異？

Well, M&A activity in the market as a whole has shown signs of life during the first half of 2024. We're clearly seeing some of that, these new mergers coming into CRA. But if you start breaking down the first half of 2024, you go from a relatively strong quarter in Q1 to a weakening in Q2. What the next couple of quarters holds, we'll wait and see. I'm sure everyone is waiting to see what happens with rates, whether we're going to get a cut or two in the coming months there. So the practice is enjoying some of the merger work. It's probably still more heavily weighted on the antitrust litigation side of the house, but we definitely have seen signs of activity with mergers.

2024 年上半年，整個市場的併購活動呈現出活躍的跡象。我們清楚地看到其中一些，這些新的合併進入了 CRA。但如果你開始細分 2024 年上半年，你就會從第一季相對強勁的季度轉為第二季的疲軟。接下來的幾個季度會發生什麼，我們拭目以待。我確信每個人都在等著看利率會發生什麼，我們是否會在未來幾個月內降息一兩次。所以做法是享受一些合併工作。它可能仍然在反壟斷訴訟方面佔據更大的比重，但我們肯定已經看到了合併活動的跡象。

Kevin Steinke, Barrington Research.

凱文‧史坦克，巴靈頓研究中心。

So just in relation to the increase in revenue guidance, can you talk through perhaps any particular practices that have trended better than expected thus far in the year that's enabling that guidance increase? You talked about continued growth in antitrust & competition economics and life sciences through this quarter. But again, is it just a broad-based contribution that's driving that guidance increase?

那麼，就收入指引的增加而言，您能否談談今年迄今為止，哪些特定做法的趨勢好於預期，從而使指導增加？您談到了本季反壟斷和競爭經濟學以及生命科學的持續成長。但同樣，推動指導增加的只是基礎廣泛的貢獻嗎？

I think to answer your question, I have to begin and maybe you could do the round of applause for antitrust & competition economics practice. Their performance has been exemplary. They're going from record quarter to a record quarter on that. They're able to grow organically. They're able to recruit. And once those recruits are inside their practice, they enjoy the benefits of the best brand and offering in the world.

我認為要回答你的問題，我必須開始，也許你可以為反壟斷和競爭經濟學實踐鼓掌。他們的表現堪稱典範。他們正在從一個創紀錄的季度走向另一個創紀錄的季度。他們能夠有機地成長。他們有能力招募。一旦這些新員工進入他們的診所，他們就會享受世界上最好的品牌和產品的好處。

So I am amazed, but I'm never going to discount what the future may hold. They have a great business model. And I don't know, if you do antitrust work, why you would want to work anywhere other than CRA? So hats off to that practice for just the extraordinary performance on it.

所以我很驚訝，但我永遠不會低估未來的情況。他們有一個很棒的商業模式。我不知道，如果你從事反壟斷工作，為什麼你會想在 CRA 以外的地方工作？因此，向這次實踐致敬，感謝其非凡的表現。

The other part I'm going to point to is we had both lines of business growing, yes, at different rates, but both are growing year over year. We had five practices, a number of those practices growing double digits for it. And so the portfolio is working. It's not always the same set of practices. We saw life sciences had a really nice quarter. We saw forensic services, which normally drives a good part of our growth, have a relatively flat quarter with it.

我要指出的另一部分是，我們的兩條業務線都在以不同的速度成長，但兩者都在逐年成長。我們有五個實踐，其中一些實踐的成長達到了兩位數。所以這個投資組合正在發揮作用。它並不總是相同的一組實踐。我們看到生命科學產業的季度表現非常好。我們發現法證服務通常是我們成長的主要動力，但其季度表現相對穩定。

So that doesn't give me pause, doesn't give me any apprehension because we've seen, time and time again, the different parts of the portfolio come through, and at the end of the year, all contribute to the expansion of CRA's book of business on it.

因此，這不會讓我猶豫，不會讓我有任何憂慮，因為我們一次又一次地看到，投資組合的不同部分都實現了，並且在年底，所有這些都有助於擴大CRA 的業務手冊對此進行了介紹。

So we're pretty pleased with what's happening across the lines, what's happening across geographies. And the assumption for us in the second half is more of the same. I'm not looking for a particular shift and who is going to help drive the performance over the next six months.

因此，我們對跨界、跨地域發生的事情感到非常滿意。我們下半年的假設也大致相同。我並不是在尋找特定的轉變以及誰將幫助推動未來六個月的績效。

Okay. Great. That's helpful.

好的。偉大的。這很有幫助。

And could you just speak to the -- I guess, call it a group hire in the intellectual property practice that happened I think shortly after your first quarter conference call that was announced. Maybe just how that came about and the opportunity you saw there to build out that practice? And then maybe just tie that into the outlook for adding additional senior talent, what the pipeline looks like there going forward?

您能否談談——我想，稱之為知識產權實踐中的集體招聘，我認為這是在您宣布的第一季電話會議後不久發生的。也許這是如何發生的以及您在那裡看到的建立這種實踐的機會？然後也許只是將其與增加更多高級人才的前景聯繫起來，未來的管道是什麼樣的？

Sure, we were thrilled to make that group hire and expand our IP practice. For me, it has a lot of similarities to what we enjoyed a couple of years ago when we helped significantly expand our labor & employment practice.

當然，我們很高興能夠僱用該團隊並擴大我們的知識產權業務。對我來說，這與我們幾年前所享受的有許多相似之處，當時我們幫助顯著擴大了我們的勞動和就業實踐。

So Chris Bakewell and Julia Rowe are CRA alum. They both worked at CRA more than a decade ago and have done wonderful things when away from CRA. And we began talking several months ago. They liked what they heard about the CRA portfolio. They knew a lot of the senior people within the intellectual property practice. So the discussions really were quite easy on that. They knew us, we knew them. We loved how it expand our services and our geographic footprint and we were able to come to an agreement relatively fast.

Chris Bakewell 和 Julia Rowe 是 CRA 校友。他們十多年前都在 CRA 工作，離開 CRA 後也做出了很多出色的事情。我們幾個月前就開始交談。他們喜歡所聽到的有關 CRA 投資組合的資訊。他們認識很多知識產權領域的資深人士。所以關於這個問題的討論確實很容易。他們了解我們，我們也了解他們。我們喜歡它如何擴展我們的服務和我們的地理足跡，並且我們能夠相對快速地達成協議。

So as I've said numerous times, I really like our portfolio of services. I think there's a lot of green space across all of the services we have, across both geographies. So there is no apprehension to invest our dollars, our time to any of the practices that exist.

正如我多次說過的，我真的很喜歡我們的服務組合。我認為我們在這兩個地區提供的所有服務中都有大量的綠色空間。因此，無需擔心將我們的金錢和時間投入到任何現有的實踐中。

Okay. Great.

好的。偉大的。

And then just in terms of the -- as you look at the campus hiring, can you talk about plans there? It sounds like, like you said, you're continuing to look for people even post this reconfiguration of the consulting team. Are you seeing more demand for that, more that junior level higher across the market? Or is that still relatively soft when you think about consultants and tech, what have you, hiring going on there?

然後，就校園招募而言，您能談談那裡的計劃嗎？正如您所說，聽起來您甚至在諮詢團隊重新配置後仍在繼續尋找人員。您是否看到市場上對此的需求比初級水平更高？或者當你想到顧問和技術時，這仍然相對較弱，那裡正在進行招募？

Yes. I think a successful talent strategy involves both lateral pursuits as in addition to university level hires. So I'm just going to address the university level hires with your question. I still think this is largely an employer market. I see overall demand for the top talent to be maybe a little softer than what we have seen in years past.

是的。我認為成功的人才策略除了大學層級的招募之外還涉及橫向追求。所以我只想回答大學級別的員工的問題。我仍然認為這主要是一個雇主市場。我認為頂尖人才的整體需求可能比過去幾年更軟。

But even with that said, we're working really hard to try to convey how attractive CRA is to new recruits. We hold a number of recruiting seminars during the summer months. We are already planning an active fall recruiting and expect to see a nice expansion of that university level recruiting as we head into '25.

但即便如此，我們仍在努力向新進員工傳達 CRA 的吸引力。我們在夏季舉辦了許多招募研討會。我們已經在計劃積極的秋季招聘，並期望在進入 25 年後看到大學級別招聘的良好擴展。

So even though it may be a little softer market from the employee side of the house, you still have to work hard to be able to attract top talent into your organization.

因此，即使從員工方面來看，市場可能會稍微疲軟，但您仍然必須努力吸引頂尖人才進入您的組織。

Okay. Great. Congratulations on the strong results and outlook.

好的。偉大的。祝賀您取得的強勁成果和前景。

I'll turn it back over.

我會把它翻回來。

Thank you, Kevin.

謝謝你，凱文。

Again, thanks to everyone for joining us today. We appreciate your time and interest in CRA. We'll be participating in meetings with investors in the coming months and we look forward to updating you on our progress on our third quarter call. That concludes today's call. Thank you.

再次感謝大家今天加入我們。感謝您花時間關注 CRA。我們將在未來幾個月內參加與投資者的會議，並期待在第三季電話會議上向您通報我們的最新進展。今天的電話會議到此結束。謝謝。

This concludes today's conference. You may disconnect your lines at this time. And we thank you for your participation.

今天的會議到此結束。此時您可以斷開線路。我們感謝您的參與。