Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 23, 2020 | |
Document And Entity Information [Abstract] | ||
Entity Incorporation, State or Country Code | DE | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Document Transition Report | false | |
Document Quarterly Report | true | |
Entity Registrant Name | HURON CONSULTING GROUP INC. | |
Entity Address, Address Line One | 550 West Van Buren Street | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60607 | |
Trading Symbol | HURN | |
Entity Central Index Key | 0001289848 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 22,849,043 | |
Entity File Number | 000-50976 | |
City Area Code | (312) | |
Local Phone Number | 583-8700 | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Tax Identification Number | 01-0666114 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 151,009 | $ 11,604 |
Receivables from clients, net of allowances of $9,187 and $8,907, respectively | 105,379 | 116,571 |
Unbilled Receivables, Current | 88,960 | 79,937 |
Income tax receivable | 748 | 2,376 |
Prepaid Expense and Other Assets, Current | 13,309 | 14,248 |
Total current assets | 359,405 | 224,736 |
Property and equipment, net | 38,326 | 38,413 |
Deferred Income Tax Assets, Net | 8,334 | 1,145 |
Long-term investment | 67,194 | 54,541 |
Operating Lease, Right-of-Use Asset | 52,849 | 54,954 |
Other non-current assets | 49,578 | 52,177 |
Intangible assets, net | 28,127 | 31,625 |
Goodwill | 586,235 | 646,680 |
Total assets | 1,190,048 | 1,104,271 |
Current liabilities: | ||
Accounts payable | 5,799 | 7,944 |
Accrued expenses and other current liabilities | 21,580 | 18,554 |
Accrued payroll and related benefits | 53,380 | 141,605 |
Long-term Debt, Current Maturities | 533 | 529 |
Operating Lease, Liability, Current | 8,206 | 7,469 |
Deferred revenues | 30,010 | 28,443 |
Total current liabilities | 119,508 | 204,544 |
Non-current liabilities: | ||
Deferred compensation and other liabilities | 26,854 | 28,635 |
Long-term debt, net of current portion | 451,189 | 208,324 |
Operating Lease, Liability, Noncurrent | 67,317 | 69,233 |
Deferred Income Tax Liabilities, Net | 571 | 8,070 |
Total non-current liabilities | 545,931 | 314,262 |
Commitments and contingencies | ||
Stockholders’ equity | ||
Common stock | 246 | 247 |
Treasury stock | (128,366) | (128,348) |
Additional paid-in capital | 444,974 | 460,781 |
Retained earnings | 195,541 | 237,849 |
Accumulated other comprehensive income | 12,214 | 14,936 |
Total stockholders’ equity | 524,609 | 585,465 |
Total liabilities and stockholders’ equity | $ 1,190,048 | $ 1,104,271 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (shares) | 25,391,801 | 25,144,764 |
Treasury stock, shares (shares) | 2,546,566 | 2,425,430 |
Accounts Receivable, Allowance for Credit Loss, Current | $ 9,187 | $ 8,907 |
Unbilled Services, Allowance for Credit Losses | $ 3,356 | $ 2,994 |
Consolidated Statements of Earn
Consolidated Statements of Earnings and Other Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues and reimbursable expenses: | ||
Revenue from Contract with Customer, Including Assessed Tax | $ 222,619 | $ 204,445 |
Reimbursable Revenues | 19,303 | 18,617 |
Total revenues and reimbursable expenses | 241,922 | 223,062 |
Direct costs and reimbursable expenses (exclusive of depreciation and amortization shown in operating expenses): | ||
Cost of Goods and Service, Excluding Depreciation, Depletion, and Amortization | 156,248 | 137,780 |
Cost, Depreciation and Amortization | 1,301 | 1,117 |
Reimbursable Expense | 19,389 | 18,669 |
Total direct costs and reimbursable expenses | 176,938 | 157,566 |
Operating expenses and other losses (gains), net | ||
Selling, general and administrative expenses | 43,446 | 50,749 |
Selling, general and administrative expenses | 1,609 | 1,275 |
Gain (Loss) Related To Litigation Settlement And Other Operating Gains | 150 | 456 |
Depreciation and amortization | 6,114 | 7,172 |
Goodwill, Impairment Loss | 59,816 | 0 |
Total operating expenses and other losses (gains), net | 110,835 | 58,740 |
Operating income (loss) | (45,851) | 6,756 |
Other income (expense), net: | ||
Interest expense, net of interest income | (2,341) | (4,258) |
Other income (expense), net | (5,296) | 2,217 |
Total other expense, net | (7,637) | (2,041) |
Income (loss) from continuing operations before taxes | (53,488) | 4,715 |
Income tax expense (benefit) | (11,215) | 1,365 |
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | (42,273) | 3,350 |
Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent | (35) | (46) |
Net income (loss) | $ (42,308) | $ 3,304 |
Net income (loss) from continuing operations | ||
Income (Loss) from Continuing Operations, Per Basic Share | $ (1.94) | $ 0.15 |
Discontinued Operation, Income (Loss) from Discontinued Operation, Net of Tax, Per Basic Share | 0 | 0 |
Basic (USD per share) | (1.94) | 0.15 |
Net earnings per diluted share: | ||
Income (Loss) from Continuing Operations, Per Diluted Share | (1.94) | 0.15 |
Discontinued Operation, Income (Loss) from Discontinued Operation, Net of Tax, Per Diluted Share | 0 | 0 |
Earnings Per Share, Diluted | $ (1.94) | $ 0.15 |
Weighted average shares used in calculating earnings (loss) per share: | ||
Weighted average common shares outstanding – basic | 21,827 | 21,868 |
Weighted average common shares outstanding – diluted | 21,827 | 22,311 |
Net income (loss) | ||
Net income (loss) | $ (42,308) | $ 3,304 |
Foreign currency translation adjustments, net of tax | (779) | 316 |
Unrealized gain (loss) on investment, net of tax | (258) | 2,657 |
Unrealized loss on cash flow hedging instruments, net of tax | (1,685) | (237) |
Other comprehensive income (loss) | (2,722) | 2,736 |
Comprehensive income (loss) | $ (45,030) | $ 6,040 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning Balance, shares at Dec. 31, 2018 | (24,418,252) | (2,671,962) | ||||
Beginning Balance at Dec. 31, 2018 | $ 540,624 | $ 244 | $ (124,794) | $ 452,573 | $ 196,106 | $ 16,495 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Comprehensive income (loss) | 6,040 | 3,304 | 2,736 | |||
Issuance of common stock in connection with: | ||||||
Restricted stock awards, net of cancellations, shares | 254,550 | 27,612 | ||||
Restricted stock awards, net of cancellations | 0 | $ 3 | $ 2,196 | (2,199) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 10,000 | |||||
Stock Issued During Period, Value, Stock Options Exercised | 234 | $ 0 | 234 | |||
Share-based compensation | 7,140 | 7,140 | ||||
Shares redeemed for employee tax withholdings, shares | (94,500) | |||||
Shares redeemed for employee tax withholdings | (4,385) | $ 4,385 | ||||
Ending Balance, shares at Mar. 31, 2019 | (24,682,802) | (2,738,850) | ||||
Ending Balance at Mar. 31, 2019 | 549,653 | $ 247 | $ (126,983) | 457,748 | 199,410 | 19,231 |
Beginning Balance, shares at Dec. 31, 2019 | (24,603,308) | (2,763,302) | ||||
Beginning Balance at Dec. 31, 2019 | 585,465 | $ 247 | $ (128,348) | 460,781 | 237,849 | 14,936 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Comprehensive income (loss) | (45,030) | (42,308) | (2,722) | |||
Issuance of common stock in connection with: | ||||||
Restricted stock awards, net of cancellations, shares | 250,544 | 102,467 | ||||
Restricted stock awards, net of cancellations | 0 | $ 2 | $ 7,115 | (7,117) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 20,000 | |||||
Stock Issued During Period, Value, Stock Options Exercised | 468 | $ 0 | 468 | |||
Share-based compensation | 11,720 | 11,720 | ||||
Shares redeemed for employee tax withholdings, shares | (120,000) | |||||
Shares redeemed for employee tax withholdings | $ (7,133) | $ 7,133 | ||||
Stock Repurchased and Retired During Period, Shares | (313,998) | (313,998) | ||||
Stock Repurchased and Retired During Period, Value | $ (20,881) | $ (3) | (20,878) | |||
Ending Balance, shares at Mar. 31, 2020 | (24,559,854) | (2,780,835) | ||||
Ending Balance at Mar. 31, 2020 | $ 524,609 | $ 246 | $ (128,366) | $ 444,974 | $ 195,541 | $ 12,214 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income | $ (42,308) | $ 3,304 |
Adjustments to reconcile net income (loss) to cash flows from operating activities: | ||
Depreciation and amortization | 7,415 | 8,538 |
Noncash Operating Lease Expense | 1,938 | 2,172 |
Operating Lease, Impairment Loss | 0 | 740 |
Share-based compensation | 8,504 | 5,366 |
Amortization of debt discount and issuance costs | 198 | 2,618 |
Goodwill, Impairment Loss | 59,816 | 0 |
Allowances For Doubtful Accounts And Unbilled Services | 21 | 59 |
Deferred Income Taxes and Tax Credits | (14,016) | 0 |
Gain (Loss) on Disposition of Business | (102) | 0 |
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | 0 | (391) |
Changes in operating assets and liabilities, net of divestiture: | ||
(Increase) decrease in receivables from clients, net | 11,698 | 5,129 |
Increase (Decrease) in Other Receivables | 9,138 | 16,850 |
(Increase) decrease in current income tax receivable / payable, net | 2,332 | 3,490 |
(Increase) decrease in other assets | 4,304 | (2,554) |
Increase (decrease) in accounts payable and other liabilities | (3,708) | 2,396 |
Increase (decrease) in accrued payroll and related benefits | (84,910) | (54,151) |
Increase (decrease) in deferred revenues | 1,606 | 1,845 |
Net cash used in operating activities | (56,146) | (38,289) |
Cash flows from investing activities: | ||
Purchases of property and equipment, net | (1,001) | (2,349) |
Payments to Acquire Investments | 13,000 | 0 |
Investment in life insurance policies | (1,472) | (3,645) |
Capitalization of internally developed software costs | (2,922) | (2,093) |
Net cash used in investing activities | (18,395) | (8,087) |
Cash flows from financing activities: | ||
Proceeds from exercises of stock options | 468 | 234 |
Shares redeemed for employee tax withholdings | (7,133) | (4,385) |
Payments for Repurchase of Common Stock | (22,115) | 0 |
Proceeds from bank borrowings | 281,000 | 40,500 |
Repayments of bank borrowings | (38,131) | (14,627) |
Net Cash Provided by (Used in) Financing Activities | 214,089 | 21,722 |
Effect of exchange rate changes on cash | (143) | 73 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | 139,405 | (24,581) |
Cash and cash equivalents at beginning of the period | 11,604 | 33,107 |
Cash and cash equivalents at end of the period | 151,009 | 8,526 |
Non-cash investing and financing activities: | ||
Property and equipment expenditures and capitalized software included in accounts payable and accrued expenses | $ 3,716 | $ 1,913 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Huron is a global consultancy that collaborates with clients to drive strategic growth, ignite innovation and navigate constant change. Through a combination of strategy, expertise and creativity, we help clients accelerate operational, digital and cultural transformation, enabling the change they need 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. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation and Significant Accounting Policies The accompanying unaudited consolidated financial statements reflect the financial position, results of operations, and cash flows as of and for the three months ended March 31, 2020 and 2019 . These financial statements have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") for Quarterly Reports on Form 10-Q. Accordingly, these financial statements do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America ("GAAP") for annual financial statements. In the opinion of management, these financial statements reflect all adjustments of a normal, recurring nature necessary for the fair statement of our financial position, results of operations, and cash flows for the interim periods presented in conformity with GAAP. These financial statements should be read in conjunction with our consolidated financial statements and notes thereto for the year ended December 31, 2019 |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments which provides a new current expected credit loss model to account for credit losses on certain financial assets, including trade receivables. That model requires an entity to estimate lifetime credit losses based on relevant historical information, adjusted for current conditions and reasonable and supportable forecasts that could affect the collectability of the reported amount. The ASU also makes targeted amendments to the current impairment model for available-for-sale debt securities, which includes requiring the recognition of an allowance rather than a direct write-down of the investment, which may be reversed in the event that the credit of an issuer improves. We adopted ASU 2016-13 effective January 1, 2020, which did not have a material impact on our consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which modifies certain disclosure requirements related to fair value measurements. We adopted ASU 2018-13 effective January 1, 2020, which had no impact on the amounts reported on our consolidated financial statements. We updated our disclosures within the notes to our consolidated financial statements as required by ASU 2018-13. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in ASC 740, Income Taxes , related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies other aspects of the accounting for franchise taxes and enacted changes in tax laws or tax rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. On January 1, 2020, we elected to early adopt ASU 2019-12 on a modified retrospective basis for those amendments that are not applied on a prospective basis. The adoption of ASU 2019-12 did not have a material impact on our consolidated financial statements. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The table below sets forth the changes in the carrying amount of goodwill by reportable segment for the three months ended March 31, 2020 . Healthcare Business Advisory Education Total Balance as of December 31, 2019: Goodwill $ 636,810 $ 302,057 $ 103,889 $ 1,042,756 Accumulated impairment losses (208,081 ) (187,995 ) — (396,076 ) Goodwill, net as of December 31, 2019 428,729 114,062 103,889 646,680 Goodwill impairment charges — (59,816 ) — (59,816 ) Foreign currency translation — (629 ) — (629 ) Goodwill, net as of March 31, 2020 $ 428,729 $ 53,617 $ 103,889 $ 586,235 First Quarter 2020 Goodwill Impairment Charges The worldwide spread of coronavirus (COVID-19) in the first quarter of 2020 has created significant volatility, uncertainty and disruption to the global economy. We are closely monitoring the impact of the COVID-19 pandemic on all aspects of our business, including how it will impact our clients, employees and business partners. While the COVID-19 pandemic did not have a significant impact on our consolidated revenues in the first quarter of 2020, we expect it to have an unfavorable impact on sales and business development activities and full year 2020 results. Additionally, we expect a decrease in the demand for the services we provide that may be considered by our clients to be more discretionary in nature. The services provided by our Strategy and Innovation and Life Sciences reporting units within our Business Advisory segment focus on strategic solutions for healthy, well-capitalized companies to identify new growth opportunities and may be considered by our clients to be more discretionary in nature; therefore, we are cautious about near-term results for these two reporting units. Based on our internal projections and the preparation of our financial statements for the quarter ended March 31, 2020, and considering the expected decrease in demand due to the COVID-19 pandemic, we believed that the fair value of these two reporting units may no longer exceed their carrying values and performed an interim impairment test on both reporting units. Our goodwill impairment test was performed by comparing the fair value of each of the Strategy and Innovation and Life Sciences reporting units with their respective carrying values and recognizing an impairment charge for the amount by which the carrying value exceeded the fair value. To estimate the fair value of each reporting unit, we relied on a combination of the income approach and the market approach, utilizing the guideline company method, with a fifty-fifty weighting. Based on the estimated fair values of the Strategy and Innovation and Life Sciences reporting units described below, we recorded non-cash pretax goodwill impairment charges of $49.9 million and $9.9 million , respectively, in the first quarter of 2020. The $49.9 million non-cash pretax charge related to the Strategy and Innovation reporting unit reduced the goodwill balance of the reporting unit to $37.5 million . The $9.9 million non-cash pretax charge related to the Life Sciences reporting unit reduced the goodwill balance of the reporting unit to zero. Concurrently with the goodwill impairment tests performed over the Strategy and Innovation and Life Sciences reporting units, we evaluated whether any indicators exist that would lead us to believe that the fair values of our Healthcare, Education, and Business Advisory reporting units may not exceed their carrying values. Based on our internal projections, consideration of the impact of the COVID-19 pandemic on these reporting units, and review of the amounts by which the fair values of these reporting units exceeded their carrying values in the most recent quantitative goodwill impairment analysis performed, we did not identify any indicators that would lead us to believe that the fair values of these reporting units may not exceed their carrying values as of March 31, 2020. In connection with the goodwill impairment tests performed on the Strategy and Innovation and Life Sciences reporting units, we performed impairment tests on the long-lived assets allocated to the asset groups of the Strategy and Innovation and Life Sciences reporting units. Based on the impairment tests performed, we concluded that the long-lived assets allocated to the asset groups were not impaired as of March 31, 2020. We did not identify any indicators that would lead us to believe that the carrying values of the long-lived assets allocated to our other asset groups may not be recoverable as of March 31, 2020. Intangible Assets Intangible assets as of March 31, 2020 and December 31, 2019 consisted of the following: As of March 31, 2020 As of December 31, 2019 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Customer relationships 3 to 13 $ 87,379 $ 64,265 $ 87,577 $ 61,882 Trade names 5 to 6 28,930 26,192 28,930 25,894 Technology and software 5 5,440 4,456 5,694 4,321 Non-competition agreements 5 2,220 1,559 2,220 1,447 Customer contracts 2 800 170 800 52 Total $ 124,769 $ 96,642 $ 125,221 $ 93,596 Identifiable intangible assets with finite lives are amortized over their estimated useful lives. Customer relationships and customer contracts, as well as certain trade names and technology and software, are amortized on an accelerated basis to correspond to the cash flows expected to be derived from the assets. All other intangible assets with finite lives are amortized on a straight-line basis. Intangible asset amortization expense was $3.2 million and $4.5 million for the three months ended March 31, 2020 and 2019 , respectively. The table below sets forth the estimated annual amortization expense for the intangible assets recorded as of March 31, 2020 . Year Ending December 31, Estimated Amortization Expense 2020 $ 12,561 2021 $ 8,358 2022 $ 6,111 2023 $ 3,512 2024 $ 741 Actual future amortization expense could differ from these estimated amounts as a result of future acquisitions, dispositions, and other factors. |
Revenues Revenue
Revenues Revenue | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Revenues For the three months ended March 31, 2020 and 2019, we recognized revenues of $222.6 million and $204.4 million , respectively. Of the $222.6 million recognized in the first quarter of 2020 , we recognized revenues of $7.9 million from obligations satisfied, or partially satisfied, in prior periods, of which $4.8 million was due to changes in the estimates of our variable consideration under performance-based billing arrangements and $3.1 million was primarily due to the release of allowances on unbilled services as a result of securing contract amendments. Of the $204.4 million recognized in the first quarter of 2019, we recognized revenues of $3.9 million from obligations satisfied, or partially satisfied, in prior periods, due to the release of allowances on unbilled services due to securing contract amendments. During the first quarter of 2019, we recognized a $1.2 million decrease to revenues due to changes in the estimates of our variable consideration under performance-based billing arrangements. As of March 31, 2020 , we had $92.5 million of remaining performance obligations under engagements with original expected durations greater than one year. These remaining performance obligations exclude obligations under contracts with an original expected duration of one year or less, variable consideration which has been excluded from the total transaction price due to the constraint, and performance obligations under time-and-expense engagements which are recognized in the amount invoiced. Of the $92.5 million of performance obligations, we expect to recognize approximately $49.6 million as revenue in 2020 , $28.2 million in 2021 , and the remaining $14.7 million thereafter. Actual revenue recognition could differ from these amounts as a result of changes in the estimated timing of work to be performed, adjustments to estimated variable consideration in performance-based arrangements, or other factors. Contract Assets and Liabilities The payment terms and conditions in our customer contracts vary. Differences between the timing of billings and the recognition of revenue are recognized as either unbilled services or deferred revenues in the consolidated balance sheets. Unbilled services include revenues recognized for services performed but not yet billed to clients. Services performed that we are not yet entitled to bill because certain events, such as the completion of the measurement period or client approval in performance-based engagements, must occur are recorded as contract assets and included within unbilled services, net. The contract asset balance as of March 31, 2020 and December 31, 2019 was $12.4 million and $12.6 million , respectively. The $0.2 million decrease primarily reflects timing differences between the completion of our performance obligations and the amounts billed or billable to clients in accordance with their contractual billing terms. Client prepayments and retainers are classified as deferred revenues and recognized over future periods in accordance with the applicable engagement agreement and our revenue recognition policy. Our deferred revenues balance as of March 31, 2020 and December 31, 2019 , was $30.0 million and $28.4 million , respectively. The $1.6 million increase primarily reflects timing differences between client payments in accordance with their contract terms and the completion of our performance obligations. For the three months ended March 31, 2020 , $14.4 million of revenues recognized were included in the deferred revenue balance as of December 31, 2019 . |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding for the period, excluding unvested restricted common stock. Diluted earnings per share reflects the potential reduction in earnings per share that could occur if securities or other contracts to issue common stock were exercised or converted into common stock under the treasury stock method. Such securities or other contracts include unvested restricted stock awards, outstanding common stock options, convertible senior notes, and outstanding warrants, to the extent dilutive. In periods for which we report a net loss from continuing operations, diluted weighted average common shares outstanding excludes all potential common stock equivalents as their impact on diluted net loss from continuing operations per share would be anti-dilutive. Earnings (loss) per share under the basic and diluted computations are as follows: Three Months Ended 2020 2019 Net income (loss) from continuing operations $ (42,273 ) $ 3,350 Income (loss) from discontinued operations, net of tax (35 ) (46 ) Net income (loss) $ (42,308 ) $ 3,304 Weighted average common shares outstanding – basic 21,827 21,868 Weighted average common stock equivalents — 443 Weighted average common shares outstanding – diluted 21,827 22,311 Net earnings (loss) per basic share: Net income (loss) from continuing operations $ (1.94 ) $ 0.15 Income (loss) from discontinued operations, net of tax — — Net income (loss) $ (1.94 ) $ 0.15 Net earnings (loss) per diluted share: Net income (loss) from continuing operations $ (1.94 ) $ 0.15 Income (loss) from discontinued operations, net of tax — — Net income (loss) $ (1.94 ) $ 0.15 The number of anti-dilutive securities excluded from the computation of the weighted average common stock equivalents presented above were as follows: As of March 31, 2020 2019 Unvested restricted stock awards 992 12 Outstanding common stock options 86 — Convertible senior notes — 3,129 Warrants related to the issuance of convertible senior notes 3,129 3,129 Total anti-dilutive securities 4,207 6,270 See Note 7 “Financing Arrangements” for further information on the convertible senior notes and warrants related to the issuance of convertible notes. We currently have a share repurchase program permitting us to repurchase up to $125 million of our common stock through October 31, 2020 (the “Share Repurchase Program”). The amount and timing of the repurchases will be determined by management and will depend on a variety of factors, including the trading price of our common stock, capacity under our credit facility, general market and business conditions, and applicable legal requirements. In the first quarter of 2020, we repurchased and retired 313,998 shares for $20.9 million . The 313,998 shares repurchased and retired in the first quarter of 2020 were included as a reduction to our basic weighted average shares outstanding for the quarter ended March 31, 2020 based on the trade date of the share repurchase. Additionally, in the first quarter of 2020, we settled the repurchase of 18,000 shares for $1.2 million that were accrued as of December 31, 2019. These shares were reflected as a reduction to our basic weighted average shares outstanding in the fourth quarter of 2019 based on the trade date of the share repurchase. No shares were repurchased during the first three months of 2019. As of March 31, 2020 , less than $0.1 million |
Financing Arrangements
Financing Arrangements | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Financing Arrangements | Financing Arrangements A summary of the carrying amounts of our debt follows: March 31, 2020 December 31, 2019 Senior secured credit facility $ 448,000 $ 205,000 Promissory note due 2024 3,722 3,853 Total long-term debt $ 451,722 $ 208,853 Current maturities of long-term debt (533 ) (529 ) Long-term debt, net of current portion $ 451,189 $ 208,324 Below is a summary of the scheduled remaining principal payments of our debt as of March 31, 2020 . Principal Payments of Long-Term Debt 2020 $ 398 2021 $ 544 2022 $ 559 2023 $ 575 2024 $ 449,646 Convertible Notes In September 2014, the Company issued $250 million principal amount of 1.25% convertible senior notes due 2019 (the “Convertible Notes”) in a private offering. The Convertible Notes were governed by the terms of an indenture between the Company and U.S. Bank National Association, as Trustee (the “Indenture”). The Convertible Notes were senior unsecured obligations of the Company and paid interest semi-annually on April 1 and October 1 of each year at an annual rate of 1.25% . Prior to maturity, upon conversion, the Convertible Notes would have been settled, at our election, in cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s common stock. Our intent and policy was to settle conversions with a combination of cash and shares of common stock with the principal amount of the Convertible Notes paid in cash, in accordance with the settlement provisions of the Indenture. Upon issuance, we separated the Convertible Notes into liability and equity components. The carrying value of the equity component representing the conversion option, which was recognized as a debt discount, was determined by deducting the fair value of the liability component from the proceeds of the Convertible Notes. The debt discount was amortized to interest expense using an effective interest rate of 4.751% over the term of the Convertible Notes. The equity component was not remeasured as it continued to meet the conditions for equity classification. The transaction costs related to the issuance of the Convertible Notes were separated into liability and equity components based on their relative values. Transaction costs attributable to the liability component were recorded as a deduction to the carrying amount of the liability and amortized to interest expense over the term of the Convertible Notes; and transaction costs attributable to the equity component were netted with the equity component of the Convertible Notes in stockholders’ equity. The following table presents the amount of interest expense recognized related to the Convertible Notes for the period presented. Three Months Ended Contractual interest coupon $ 781 Amortization of debt discount 2,120 Amortization of debt issuance costs 315 Total interest expense $ 3,216 In connection with the issuance of the Convertible Notes, we entered into convertible note hedge transactions and warrant transactions. The convertible note hedge transactions were intended to reduce the potential future economic dilution associated with the conversion of the Convertible Notes and, combined with the warrants, effectively raised the price at which economic dilution would occur from the initial conversion price of approximately $79.89 to approximately $97.12 per share. The convertible note hedge transactions expired in the third quarter of 2019. The holders of the warrants have the option to purchase an initial total of approximately 3.1 million shares of the Company’s common stock at a strike price of approximately $97.12 . The warrants are expiring incrementally on 100 different dates from January 6, 2020 to May 28, 2020 and are exercisable at each such expiry date. If the average market value per share of our common stock for the reporting period exceeds the strike price of the warrants, the warrants will have a dilutive effect on our earnings per share. The warrants are separate transactions and are not part of the terms of the Convertible Notes or the convertible note hedge transactions. Senior Secured Credit Facility The Company has a $600 million senior secured revolving credit facility, subject to the terms of a Second Amended and Restated Credit Agreement dated as of March 31, 2015, as amended to date (as amended and modified the "Amended Credit Agreement"), that becomes due and payable in full upon maturity on September 27, 2024 . The Amended Credit Agreement provides the option to increase the revolving credit facility or establish term loan facilities in an aggregate amount of up to $150 million , subject to customary conditions and the approval of any lender whose commitment would be increased, resulting in a maximum available principal amount under the Amended Credit Agreement of $750 million . The initial borrowings under the Amended Credit Agreement were used to refinance borrowings outstanding under a prior credit agreement, and future borrowings under the Amended Credit Agreement may be used for working capital, capital expenditures, acquisitions of businesses, share repurchases, and general corporate purposes. Fees and interest on borrowings vary based on our Consolidated Leverage Ratio (as defined in the Amended Credit Agreement). At our option, borrowings under the Amended Credit Agreement will bear interest at one, two, three or six-month LIBOR or an alternate base rate, in each case plus the applicable margin. The applicable margin will fluctuate between 1.125% per annum and 1.875% per annum, in the case of LIBOR borrowings, or between 0.125% per annum and 0.875% per annum, in the case of base rate loans, based upon our Consolidated Leverage Ratio at such time. Amounts borrowed under the Amended Credit Agreement may be prepaid at any time without premium or penalty. We are required to prepay the amounts outstanding under the Amended Credit Agreement in certain circumstances, including upon an Event of Default (as defined in the Amended Credit Agreement). In addition, we have the right to permanently reduce or terminate the unused portion of the commitments provided under the Amended Credit Agreement at any time. The loans and obligations under the Amended Credit Agreement are secured pursuant to a Second Amended and Restated Security Agreement and a Second Amended and Restated Pledge Agreement (as amended, the “Pledge Agreement”) with Bank of America, N.A. as collateral agent, pursuant to which the Company and the subsidiary guarantors grant Bank of America, N.A., for the ratable benefit of the lenders under the Amended Credit Agreement, a first-priority lien, subject to permitted liens, on substantially all of the personal property assets of the Company and the subsidiary guarantors, and a pledge of 100% of the stock or other equity interests in all domestic subsidiaries and 65% of the stock or other equity interests in each “material first-tier foreign subsidiary” (as defined in the Pledge Agreement). The Amended Credit Agreement contains usual and customary representations and warranties; affirmative and negative covenants, which include limitations on liens, investments, additional indebtedness, and restricted payments; and two quarterly financial covenants as follows: (i) a maximum Consolidated Leverage Ratio (defined as the ratio of debt to consolidated EBITDA) of 3.75 to 1.00; however the maximum permitted Consolidated Leverage Ratio will increase to 4.00 to 1.00 upon the occurrence of certain transactions, and (ii) a minimum Consolidated Interest Coverage Ratio (defined as the ratio of consolidated EBITDA to interest) of 3.50 to 1.00. Consolidated EBITDA for purposes of the financial covenants is calculated on a continuing operations basis and includes adjustments to add back non-cash goodwill impairment charges, share-based compensation costs, certain non-cash restructuring charges, pro forma historical EBITDA for businesses acquired, and other specified items in accordance with the Amended Credit Agreement. At March 31, 2020 , we were in compliance with these financial covenants with a Consolidated Leverage Ratio of 3.48 to 1.00 and a Consolidated Interest Coverage Ratio of 15.13 to 1.00. Borrowings outstanding under the Amended Credit Agreement at March 31, 2020 totaled $448.0 million . These borrowings carried a weighted average interest rate of 2.3% , including the effect of the interest rate swaps described in Note 9 “Derivative Instruments and Hedging Activity." Borrowings outstanding under the Amended Credit Agreement at December 31, 2019 were $205.0 million and carried a weighted average interest rate of 3.0% , including the effect of the interest rate swap outstanding at the time and described in Note 9 “Derivative Instruments and Hedging Activity." The borrowing capacity under the revolving credit facility is reduced by any outstanding borrowings under the revolving credit facility and outstanding letters of credit. At March 31, 2020 , we had outstanding letters of credit totaling $1.6 million , which are primarily used as security deposits for our office facilities. As of March 31, 2020 , the unused borrowing capacity under the revolving credit facility was $150.4 million . Promissory Note due 2024 On June 30, 2017, in conjunction with our purchase of an aircraft related to the acquisition of Innosight, we assumed, from the sellers of the aircraft, a promissory note with an outstanding principal balance of $5.1 million . The principal balance of the promissory note is subject to scheduled monthly principal payments until the maturity date of March 1, 2024 , at which time a final payment of $1.5 million , plus any accrued and unpaid interest, will be due. Under the terms of the promissory note, we will pay interest on the outstanding principal amount at a rate of one month LIBOR plus 1.97% per annum. The obligations under the promissory note are secured pursuant to a Loan and Aircraft Security Agreement with Banc of America Leasing & Capital, LLC, which grants the lender a first priority security interest in the aircraft. At March 31, 2020 , the outstanding principal amount of the promissory note was $3.7 million , and the aircraft had a carrying amount of $4.9 million . At December 31, 2019 , the outstanding principal amount of the promissory note was $3.9 million , and the aircraft had a carrying amount of $5.1 million |
Restructuring Charges
Restructuring Charges | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges Restructuring charges for the first three months of 2020 totaled $1.6 million , compared to $1.3 million for the first three months of 2019 . The $1.6 million restructuring charge incurred in the first quarter of 2020 related to a $1.2 million accrual for the termination of a third-party advisor agreement, $0.3 million related to workforce reductions to better align resources with market demand, and $0.1 million related to workforce reductions in our corporate operations. During the first quarter of 2019, we exited a portion of our Lake Oswego, Oregon corporate office resulting in a $0.7 million lease impairment charge on the related operating lease right-of-use asset and leasehold improvements and $0.2 million of accelerated depreciation on furniture and fixtures in that office. Additionally, we recognized a $0.2 million restructuring charge related to workforce reductions in our corporate operations. The table below sets forth the changes in the carrying amount of our restructuring charge liability by restructuring type for the three months ended March 31, 2020 . Employee Costs Office Space Reductions Other Total Balance as of December 31, 2019 $ 68 $ 91 $ — $ 159 Additions 411 — 1,188 1,599 Payments (473 ) — (67 ) (540 ) Adjustments 8 — — 8 Balance as of March 31, 2020 $ 14 $ 91 $ 1,121 $ 1,226 The $0.1 million restructuring charge liability related to office space reductions at March 31, 2020 is included as a component of accrued expenses and other current liabilities and deferred compensation and other liabilities. The restructuring charge liability related to employee costs at March 31, 2020 is expected to be paid in the next 12 months and is included as a component of accrued payroll and related benefits. The $1.1 million restructuring charge liability related to the termination of a third-party advisor agreement at March 31, 2020 is expected to be paid over the next 34 months and is included as a component of accrued expenses and other current liabilities and deferred compensation and other liabilities. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activity | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activity | Derivative Instruments and Hedging Activity On June 22, 2017, we entered into a forward interest rate swap agreement effective August 31, 2017 and ending August 31, 2022 , with a notional amount of $50.0 million . We entered into this derivative instrument to hedge against the interest rate risks of our variable-rate borrowings. Under the terms of the interest rate swap agreement, we receive from the counterparty interest on the notional amount based on one month LIBOR and we pay to the counterparty a fixed rate of 1.900% . On January 30, 2020, we entered into a forward interest rate swap agreement effective December 31, 2019 and ending December 31, 2024 , with a notional amount of $50.0 million . We entered into this derivative instrument to further hedge against the interest rate risks of our variable-rate borrowings. Under the terms of the interest rate swap agreement, we receive from the counterparty interest on the notional amount based on one month LIBOR and we pay to the counterparty a fixed rate of 1.500% . On March 16, 2020, we entered into a forward interest rate swap agreement effective February 28, 2020 and ending February 28, 2025 , with a notional amount of $100.0 million . We entered into this derivative instrument to further hedge against the interest rate risks of our variable-rate borrowings. Under the terms of the interest rate swap agreement, we receive from the counterparty interest on the notional amount based on one month LIBOR and we pay to the counterparty a fixed rate of 0.885% . We recognize all derivative instruments as either assets or liabilities at fair value on the balance sheet. We have designated these derivative instruments as cash flow hedges. Therefore, changes in the fair value of the derivative instruments are recorded to other comprehensive income (“OCI”) to the extent effective and reclassified into interest expense upon settlement. As of March 31, 2020 , it was anticipated that $1.4 million of the losses, net of tax, currently recorded in accumulated other comprehensive income will be reclassified into earnings within the next 12 months. The table below sets forth additional information relating to the interest rate swaps designated as a cash flow hedging instrument as of March 31, 2020 and December 31, 2019 . Fair Value (Derivative Asset and Liability) Balance Sheet Location March 31, December 31, Accrued expenses and other current liabilities $ 1,156 $ 159 Deferred compensation and other liabilities $ 1,666 $ 387 All of our derivative instruments are transacted under the International Swaps and Derivatives Association (ISDA) master agreements. These agreements permit the net settlement of amounts owed in the event of default and certain other termination events. Although netting is permitted, it is our policy to record all derivative assets and liabilities on a gross basis on our consolidated balance sheet. We do not use derivative instruments for trading or other speculative purposes. Refer to Note 11 “Other Comprehensive Income (Loss)” for additional information on our derivative instruments. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Certain of our assets and liabilities are measured at fair value. Fair value is defined as the price that would be received to sell an asset or the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP establishes a fair value hierarchy for inputs used in measuring fair value and requires companies to maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy consists of three levels based on the objectivity of the inputs as follows: Level 1 Inputs Quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 Inputs Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 Inputs Unobservable inputs for the asset or liability, and include situations in which there is little, if any, market activity for the asset or liability. The table below sets forth our fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 . Level 1 Level 2 Level 3 Total March 31, 2020 Assets: Convertible debt investment $ — $ — $ 62,194 $ 62,194 Deferred compensation assets — 24,220 — 24,220 Total assets $ — $ 24,220 $ 62,194 $ 86,414 Liabilities: Interest rate swaps $ — $ 2,822 $ — $ 2,822 Total liabilities $ — $ 2,822 $ — $ 2,822 December 31, 2019 Assets: Convertible debt investment — — 49,542 49,542 Deferred compensation assets — 27,445 — 27,445 Total assets $ — $ 27,445 $ 49,542 $ 76,987 Liabilities: Interest rate swap $ — $ 546 $ — $ 546 Total liabilities $ — $ 546 $ — $ 546 Interest rate swaps: The fair values of our interest rate swaps were derived using estimates to settle the interest rate swap agreements, which are based on the net present value of expected future cash flows on each leg of the swaps utilizing market-based inputs and a discount rate reflecting the risks involved. Convertible debt investment: In 2014 and 2015, we invested $27.9 million , in the form of zero coupon convertible debt (the "initial convertible notes"), in Shorelight Holdings, LLC (“Shorelight”), the parent company of Shorelight, a U.S.-based company that partners with leading nonprofit universities to increase access to and retention of international students, boost institutional growth, and enhance an institution’s global footprint. In the first quarter of 2020, we invested an additional $13.0 million , in the form of 1.69% convertible debt with a senior liquidation preference to the initial convertible notes (the "additional convertible note"); and amended our initial convertible notes to include a coupon rate of 1.69% and extend the maturity date to January 17, 2024 , which coincides with the maturity date of the additional convertible note. To determine the appropriate accounting treatment for our investment, we performed a variable interest entity (“VIE”) analysis and concluded that Shorelight does not meet the definition of a VIE. We also reviewed the characteristics of our investment to confirm that the convertible notes are not in-substance common stock that would warrant equity method accounting. After we reviewed all of the terms of the investment, we concluded the appropriate accounting treatment to be that of an available-for-sale debt security. The investment is carried at fair value with unrealized holding gains and losses excluded from earnings and reported in other comprehensive income. We estimate the fair value of our investment using a scenario-based approach in the form of a hybrid analysis that consists of a Monte Carlo simulation model and an expected return analysis. The conclusion of value for our investment is based on the probability weighted assessment of both scenarios. The hybrid analysis utilizes certain assumptions including the assumed holding period through the maturity date of January 17, 2024 , the applicable waterfall distribution at the end of the expected holding period based on the rights and privileges of the various instruments, cash flow projections discounted at the risk-adjusted rate of 26% , and the concluded equity volatility of 42.5% , all of which are Level 3 inputs. The valuation of our investment as of December 31, 2019 takes into consideration the equity value indication as well as the dilutive impact of the convertible debt issued by Shorelight in the first quarter of 2020, the terms of which were known or knowable as of December 31, 2019. The use of alternative estimates and assumptions could increase or decrease the estimated fair value of the investment, which would result in different impacts to our consolidated balance sheet and comprehensive income. Actual results may differ from our estimates. The fair value of the convertible debt investment is recorded in long-term investments on our consolidated balance sheets. The table below sets forth the changes in the balance of the convertible debt investment for the three months ended March 31, 2020 . Convertible Debt Investment Balance as of December 31, 2019 $ 49,542 Purchases 13,000 Change in fair value of convertible debt investment (348 ) Balance as of March 31, 2020 $ 62,194 Deferred compensation assets: We have a non-qualified deferred compensation plan (the "Plan") for the members of our board of directors and a select group of our employees. The deferred compensation liability is funded by the Plan assets, which consist of life insurance policies maintained within a trust. The cash surrender value of the life insurance policies approximates fair value and is based on third-party broker statements which provide the fair value of the life insurance policies' underlying investments, which are Level 2 inputs. The cash surrender value of the life insurance policies is invested primarily in mutual funds. The Plan assets are included in other non-current assets on our consolidated balance sheets. Realized and unrealized gains (losses) from the deferred compensation assets are recorded to other income (expense), net in our consolidated statements of operations. Financial assets and liabilities not recorded at fair value are as follows: Preferred Stock Investment In the fourth quarter of 2019, we invested $5.0 million , in the form of preferred stock, in Medically Home Group, Inc. ("Medically Home"), a healthcare technology-enabled services company. To determine the appropriate accounting treatment for our investment, we performed a VIE analysis and concluded that Medically Home does not meet the definition of a VIE. We also reviewed the characteristics of our investment to confirm that the preferred stock is not in-substance common stock that would warrant equity method accounting. After we reviewed all of the terms of the investment, we concluded the appropriate accounting treatment for our investment in Medically Home to be that of an equity security with no readily determinable fair value. We elected to apply the measurement alternative at the time of the purchase and will continue to do so until the investment does not qualify to be so measured. Under the measurement alternative, the investment is carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment in Medically Home. On a quarterly basis, we review the information available to determine whether an orderly and observable transaction for the same or similar equity instrument occurred, and remeasure the fair value of the preferred stock using such identified transactions, with changes in the fair value recorded in consolidated statement of operations. Following our purchase, there has been no impairment, nor any observable price changes to our investment. Senior Secured Credit Facility The carrying value of our borrowings outstanding under our senior secured credit facility is stated at cost. Our carrying value approximates fair value, using Level 2 inputs, as the senior secured credit facility bears interest at variable rates based on current market rates as set forth in the Amended Credit Agreement. Refer to Note 7 “Financing Arrangements” for additional information on our senior secured credit facility. Promissory Note due 2024 The carrying value of our promissory note due 2024 is stated at cost. Our carrying value approximates fair value, using Level 2 inputs, as the promissory note bears interest at rates based on current market rates as set forth in the terms of the promissory note. Refer to Note 7 “Financing Arrangements” for additional information on our promissory note due 2024. Cash and Cash Equivalents and Other Financial Instruments Cash and cash equivalents are stated at cost, which approximates fair market value. The carrying values of all other financial instruments not described above reasonably approximate fair market value due to the nature of the financial instruments and the short-term maturity of these items. |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) The table below sets forth the components of other comprehensive income (loss), net of tax, for the three months ended March 31, 2020 and 2019 . Three Months Ended Three Months Ended Before Tax Net of Before Tax Net of Other comprehensive income (loss): Foreign currency translation adjustments $ (779 ) $ — $ (779 ) $ 316 $ — $ 316 Unrealized gain (loss) on investment $ (348 ) $ 90 $ (258 ) $ 3,609 $ (952 ) $ 2,657 Unrealized gain (loss) on cash flow hedges: Change in fair value $ (2,272 ) $ 590 $ (1,682 ) $ (247 ) $ 65 $ (182 ) Reclassification adjustments into earnings (4 ) 1 (3 ) (74 ) 19 (55 ) Net unrealized gain (loss) $ (2,276 ) $ 591 $ (1,685 ) $ (321 ) $ 84 $ (237 ) Other comprehensive income (loss) $ (3,403 ) $ 681 $ (2,722 ) $ 3,604 $ (868 ) $ 2,736 The before tax amounts reclassified from accumulated other comprehensive income related to our cash flow hedges are recorded to interest expense, net of interest income. Accumulated other comprehensive income, net of tax, includes the following components: Foreign Currency Translation Available-for-Sale Investment Cash Flow Hedges Total Balance, December 31, 2019 $ (566 ) $ 15,882 $ (380 ) $ 14,936 Current period change (779 ) (258 ) (1,685 ) (2,722 ) Balance, March 31, 2020 $ (1,345 ) $ 15,624 $ (2,065 ) $ 12,214 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On March 27, 2020, the President of the United States signed into law the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The CARES Act is an approximately $2 trillion emergency economic stimulus package in response to the COVID-19 outbreak, which among other items, includes income tax provisions relating to net operating loss carryback periods and technical corrections to tax depreciation methods for qualified improvement property. As a result of the enactment of this legislation during the first quarter of 2020, we recorded a tax benefit of $0.8 million related to the remeasurement of a portion of our income tax receivable due to the ability to apply the federal net operating loss incurred in 2018 to prior year income for a refund at a higher tax rate in the carryback period. For the three months ended March 31, 2020 , our effective tax rate was 21.0% as we recognized an income tax benefit from continuing operations of $11.2 million on a loss from continuing operations of $53.5 million . The effective tax rate of 21.0% was less favorable than the statutory rate, inclusive of state income taxes, of 26.0% primarily due to certain nondeductible expense items, non-deductible losses on our investments used to fund our deferred compensation liability, and the nondeductible portion of the goodwill impairment charges recorded during the first quarter of 2020. These unfavorable items were partially offset by a discrete tax benefit for share-based compensation awards that vested during the quarter and the discrete tax benefit for the remeasurement of a portion of our income tax receivable as a result of the enactment of the CARES Act in the first quarter of 2020. For the three months ended March 31, 2019 , our effective tax rate was 29.0% as we recognized income tax expense from continuing operations of $1.4 million on income from continuing operations of $4.7 million . The effective tax rate of 29.0% was less favorable than the statutory rate, inclusive of state income taxes, of 26.4% primarily due to foreign losses with no tax benefit and disallowed executive compensation deductions. These unfavorable items were partially offset by a discrete tax benefit for share-based compensation awards that vested during the first quarter of 2019. |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | Commitments, Contingencies and Guarantees Litigation From time to time, we are involved in legal proceedings and litigation arising in the ordinary course of business. As of the date of this Quarterly Report on Form 10-Q, we are not a party to any litigation or legal proceeding that, in the current opinion of management, could have a material adverse effect on our financial position or results of operations. However, due to the risks and uncertainties inherent in legal proceedings, actual results could differ from current expected results. Guarantees Guarantees in the form of letters of credit totaling $1.6 million and $1.7 million were outstanding at March 31, 2020 and December 31, 2019 , respectively, primarily to support certain office lease obligations. In connection with certain business acquisitions, we may be required to pay post-closing consideration to the sellers if specific financial performance targets are met over a number of years as specified in the related purchase agreements. As of March 31, 2020 and December 31, 2019 , the total estimated fair value of our contingent consideration liability was zero. To the extent permitted by law, our bylaws and articles of incorporation require that we indemnify our officers and directors against judgments, fines and amounts paid in settlement, including attorneys’ fees, incurred in connection with civil or criminal action or proceedings, as it relates to their services to us if such person acted in good faith. Although there is no limit on the amount of indemnification, we may have recourse against our insurance carrier for certain payments made. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Segments are defined as components of a company that engage in business activities from which they may earn revenues and incur expenses, and for which separate financial information is available and is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision maker, who is our chief executive officer, manages the business under three operating segments, which are our reportable segments: Healthcare, Business Advisory, and Education. • Healthcare Our Healthcare segment has a depth of expertise in financial and operational improvement, care transformation, culture and organizational excellence, strategy, and technology and analytics. We serve national and regional hospitals, integrated health systems, academic medical centers, community hospitals, and medical groups. Our solutions help clients evolve and adapt to the rapidly changing healthcare environment and achieve growth, optimize performance, enhance profitability, improve quality and clinical outcomes, align leaders, improve organizational culture, and drive physician, patient, and employee engagement across the enterprise to deliver better consumer outcomes. We help organizations transform and innovate their delivery model to focus on patient wellness by improving quality outcomes, minimizing care variation and fundamentally improving patient and population health. Our consultants partner with clients to help build and sustain today’s business to invest in the future by reducing complexity, improving operational efficiency and growing market share. We enable the healthcare of the future by identifying, integrating and optimizing technology investments to collect data that transforms care delivery and improves patient outcomes. We also develop future leaders capable of driving meaningful cultural and organizational change and who transform the consumer experience. • Business Advisory Our Business Advisory segment provides services to large and middle market organizations, lending institutions, law firms, investment banks, private equity firms, and not-for-profit organizations, including higher education and healthcare institutions. We assist clients in a broad range of industries and across the spectrum from healthy, well-capitalized companies to organizations in transition, as well as creditors, equity owners, and other key constituents. Our Enterprise Solutions and Analytics experts advise, deliver, and optimize technology and analytic solutions that enable organizations to manage and optimize their financial performance, operational efficiency, and client or stakeholder experience. Our Business Advisory experts resolve complex business issues and enhance client enterprise value through a suite of services including capital advisory, transaction advisory, operational improvement, restructuring and turnaround, valuation, and dispute advisory. Our Strategy and Innovation professionals collaborate with clients across a range of industries to identify new growth opportunities, build new ventures and capabilities, and accelerate organizational change. Our Life Sciences professionals provide strategic solutions to help pharmaceutical, medical device, and biotechnology companies deliver more value to patients, payers, and providers, and comply with regulations. • Education Our Education segment provides consulting and technology solutions to higher education institutions and academic medical centers. We collaborate with clients to address challenges relating to business and technology strategy, financial and operational excellence, student success, research administration, and regulatory compliance. Our research enterprise solutions assist clients in identifying and implementing institutional research strategy, optimizing clinical research operations, improving financial management and cost reimbursement, improving service to faculty, and mitigating risk compliance. Our technology strategy, enterprise applications, and analytic solutions transform and optimize operations, deliver time and cost savings, and enhance the student experience. Our institutional strategy, budgeting and financial management, and business operations align missions with business priorities, improve quality, and reduce costs institution-wide. Our student solutions improve attraction, retention and graduation rates, increase student satisfaction and help generate quality outcomes. Segment operating income consists of the revenues generated by a segment, less the direct costs of revenue and selling, general and administrative expenses that are incurred directly by the segment. Unallocated corporate costs include costs related to administrative functions that are performed in a centralized manner that are not attributable to a particular segment. These administrative function costs include costs for corporate office support, certain office facility costs, costs relating to accounting and finance, human resources, legal, marketing, information technology, and company-wide business development functions, as well as costs related to overall corporate management. The table below sets forth information about our operating segments for the three months ended March 31, 2020 and 2019 , along with the items necessary to reconcile the segment information to the totals reported in the accompanying consolidated financial statements. Three Months Ended 2020 2019 Healthcare: Revenues $ 95,578 $ 93,682 Operating income $ 24,050 $ 27,851 Segment operating income as a percentage of segment revenues 25.2 % 29.7 % Business Advisory: Revenues $ 64,905 $ 58,806 Operating income $ 9,842 $ 9,581 Segment operating income as a percentage of segment revenues 15.2 % 16.3 % Education: Revenues $ 62,136 $ 51,957 Operating income $ 13,116 $ 12,618 Segment operating income as a percentage of segment revenues 21.1 % 24.3 % Total Company: Revenues $ 222,619 $ 204,445 Reimbursable expenses 19,303 18,617 Total revenues and reimbursable expenses $ 241,922 $ 223,062 Segment operating income $ 47,008 $ 50,050 Items not allocated at the segment level: Other operating expenses 27,146 36,578 Litigation and other gains (150 ) (456 ) Depreciation and amortization 6,047 7,172 Goodwill impairment charges 1 59,816 — Other expense, net 7,637 2,041 Income (loss) from continuing operations before taxes $ (53,488 ) $ 4,715 (1) The goodwill impairment charges are not allocated at the segment level because the underlying goodwill asset is reflective of our corporate investment in the segments. We do not include the impact of goodwill impairment charges in our evaluation of segment performance. The following table illustrates the disaggregation of revenues by billing arrangements, employee types, and timing of revenue recognition, including a reconciliation of the disaggregated revenues to revenues from our three operating segments for the three months ended March 31, 2020 and 2019. Three Months Ended March 31, 2020 Healthcare Business Advisory Education Total Billing Arrangements Fixed-fee $ 55,785 $ 25,393 $ 13,175 $ 94,353 Time and expense 14,733 37,589 43,711 96,033 Performance-based 18,921 646 — 19,567 Software support, maintenance and subscriptions 6,139 1,277 5,250 12,666 Total $ 95,578 $ 64,905 $ 62,136 $ 222,619 Employee Type (1) Revenue generated by full-time billable consultants $ 65,445 $ 61,957 $ 53,436 $ 180,838 Revenue generated by full-time equivalents 30,133 2,948 8,700 41,781 Total $ 95,578 $ 64,905 $ 62,136 $ 222,619 Timing of Revenue Recognition Revenue recognized over time $ 94,459 $ 64,905 $ 62,022 $ 221,386 Revenue recognized at a point in time 1,119 — 114 1,233 Total $ 95,578 $ 64,905 $ 62,136 $ 222,619 Three Months Ended March 31, 2019 Healthcare Business Advisory Education Total Billing Arrangements Fixed-fee $ 63,584 $ 21,672 $ 12,383 $ 97,639 Time and expense 12,763 35,309 35,358 83,430 Performance-based 11,810 664 — 12,474 Software support, maintenance and subscriptions 5,525 1,161 4,216 10,902 Total $ 93,682 $ 58,806 $ 51,957 $ 204,445 Employee Type (1) Revenue generated by full-time billable consultants $ 64,818 $ 57,094 $ 46,007 $ 167,919 Revenue generated by full-time equivalents 28,864 1,712 5,950 36,526 Total $ 93,682 $ 58,806 $ 51,957 $ 204,445 Timing of Revenue Recognition Revenue recognized over time $ 91,642 $ 58,806 $ 51,711 $ 202,159 Revenue recognized at a point in time 2,040 — 246 2,286 Total $ 93,682 $ 58,806 $ 51,957 $ 204,445 (1) Full-time billable consultants consist of our full-time professionals who provide consulting services to our clients and are billable to our clients based on the number of hours worked. Full-time equivalent professionals consist of leadership coaches and their support staff within our Healthcare Leadership solution, consultants who work variable schedules as needed by our clients, and full-time employees who provide software support and maintenance services to our clients. At March 31, 2020 and December 31, 2019, no single client accounted for greater than 10% of our combined balance of receivables from clients, net and unbilled services, net. During the three months ended March 31, 2020 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated financial statements reflect the financial position, results of operations, and cash flows as of and for the three months ended March 31, 2020 and 2019 . These financial statements have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") for Quarterly Reports on Form 10-Q. Accordingly, these financial statements do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America ("GAAP") for annual financial statements. In the opinion of management, these financial statements reflect all adjustments of a normal, recurring nature necessary for the fair statement of our financial position, results of operations, and cash flows for the interim periods presented in conformity with GAAP. These financial statements should be read in conjunction with our consolidated financial statements and notes thereto for the year ended December 31, 2019 included in our Annual Report on Form 10-K. Our results for any interim period are not necessarily indicative of results for a full year or any other interim period. |
Earnings Per Share, Policy | Basic earnings per share excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding for the period, excluding unvested restricted common stock. Diluted earnings per share reflects the potential reduction in earnings per share that could occur if securities or other contracts to issue common stock were exercised or converted into common stock under the treasury stock method. Such securities or other contracts include unvested restricted stock awards, outstanding common stock options, convertible senior notes, and outstanding warrants, to the extent dilutive. In periods for which we report a net loss from continuing operations, diluted weighted average common shares outstanding excludes all potential common stock equivalents as their impact on diluted net loss from continuing operations per share would be anti-dilutive. |
Derivatives and Hedging, Policy | We recognize all derivative instruments as either assets or liabilities at fair value on the balance sheet. We have designated these derivative instruments as cash flow hedges. Therefore, changes in the fair value of the derivative instruments are recorded to other comprehensive income (“OCI”) to the extent effective and reclassified into interest expense upon settlement. |
Fair Value of Financial Instruments, Policy | Fair value is defined as the price that would be received to sell an asset or the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP establishes a fair value hierarchy for inputs used in measuring fair value and requires companies to maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy consists of three levels based on the objectivity of the inputs as follows: Level 1 Inputs Quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 Inputs Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 Inputs Unobservable inputs for the asset or liability, and include situations in which there is little, if any, market activity for the asset or liability. |
Segment Reporting, Policy | Segments are defined as components of a company that engage in business activities from which they may earn revenues and incur expenses, and for which separate financial information is available and is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision maker, who is our chief executive officer, manages the business under three operating segments, which are our reportable segments: Healthcare, Business Advisory, and Education. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill | The table below sets forth the changes in the carrying amount of goodwill by reportable segment for the three months ended March 31, 2020 . Healthcare Business Advisory Education Total Balance as of December 31, 2019: Goodwill $ 636,810 $ 302,057 $ 103,889 $ 1,042,756 Accumulated impairment losses (208,081 ) (187,995 ) — (396,076 ) Goodwill, net as of December 31, 2019 428,729 114,062 103,889 646,680 Goodwill impairment charges — (59,816 ) — (59,816 ) Foreign currency translation — (629 ) — (629 ) Goodwill, net as of March 31, 2020 $ 428,729 $ 53,617 $ 103,889 $ 586,235 |
Intangible Assets | Intangible assets as of March 31, 2020 and December 31, 2019 consisted of the following: As of March 31, 2020 As of December 31, 2019 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Customer relationships 3 to 13 $ 87,379 $ 64,265 $ 87,577 $ 61,882 Trade names 5 to 6 28,930 26,192 28,930 25,894 Technology and software 5 5,440 4,456 5,694 4,321 Non-competition agreements 5 2,220 1,559 2,220 1,447 Customer contracts 2 800 170 800 52 Total $ 124,769 $ 96,642 $ 125,221 $ 93,596 |
Schedule of Future Amortization Expense | The table below sets forth the estimated annual amortization expense for the intangible assets recorded as of March 31, 2020 . Year Ending December 31, Estimated Amortization Expense 2020 $ 12,561 2021 $ 8,358 2022 $ 6,111 2023 $ 3,512 2024 $ 741 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Reconciliation of Basic and Diluted Earnings Per Share | Earnings (loss) per share under the basic and diluted computations are as follows: Three Months Ended 2020 2019 Net income (loss) from continuing operations $ (42,273 ) $ 3,350 Income (loss) from discontinued operations, net of tax (35 ) (46 ) Net income (loss) $ (42,308 ) $ 3,304 Weighted average common shares outstanding – basic 21,827 21,868 Weighted average common stock equivalents — 443 Weighted average common shares outstanding – diluted 21,827 22,311 Net earnings (loss) per basic share: Net income (loss) from continuing operations $ (1.94 ) $ 0.15 Income (loss) from discontinued operations, net of tax — — Net income (loss) $ (1.94 ) $ 0.15 Net earnings (loss) per diluted share: Net income (loss) from continuing operations $ (1.94 ) $ 0.15 Income (loss) from discontinued operations, net of tax — — Net income (loss) $ (1.94 ) $ 0.15 |
Summary of Anti-dilutive Securities Excluded from Computation of Weighted Average Common Stock Equivalents | The number of anti-dilutive securities excluded from the computation of the weighted average common stock equivalents presented above were as follows: As of March 31, 2020 2019 Unvested restricted stock awards 992 12 Outstanding common stock options 86 — Convertible senior notes — 3,129 Warrants related to the issuance of convertible senior notes 3,129 3,129 Total anti-dilutive securities 4,207 6,270 |
Financing Arrangements (Tables)
Financing Arrangements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Carrying Amounts of Debt | A summary of the carrying amounts of our debt follows: March 31, 2020 December 31, 2019 Senior secured credit facility $ 448,000 $ 205,000 Promissory note due 2024 3,722 3,853 Total long-term debt $ 451,722 $ 208,853 Current maturities of long-term debt (533 ) (529 ) Long-term debt, net of current portion $ 451,189 $ 208,324 |
Schedule of Maturities of Long-term Debt | Below is a summary of the scheduled remaining principal payments of our debt as of March 31, 2020 . Principal Payments of Long-Term Debt 2020 $ 398 2021 $ 544 2022 $ 559 2023 $ 575 2024 $ 449,646 |
Summary of Interest Expense Recognized | The following table presents the amount of interest expense recognized related to the Convertible Notes for the period presented. Three Months Ended Contractual interest coupon $ 781 Amortization of debt discount 2,120 Amortization of debt issuance costs 315 Total interest expense $ 3,216 |
Restructuring Charges Restructu
Restructuring Charges Restructuring Liability Rollforward (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The table below sets forth the changes in the carrying amount of our restructuring charge liability by restructuring type for the three months ended March 31, 2020 . Employee Costs Office Space Reductions Other Total Balance as of December 31, 2019 $ 68 $ 91 $ — $ 159 Additions 411 — 1,188 1,599 Payments (473 ) — (67 ) (540 ) Adjustments 8 — — 8 Balance as of March 31, 2020 $ 14 $ 91 $ 1,121 $ 1,226 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value Interest Rate Swaps Designated as Cash Flow Hedging Instruments | The table below sets forth additional information relating to the interest rate swaps designated as a cash flow hedging instrument as of March 31, 2020 and December 31, 2019 . Fair Value (Derivative Asset and Liability) Balance Sheet Location March 31, December 31, Accrued expenses and other current liabilities $ 1,156 $ 159 Deferred compensation and other liabilities $ 1,666 $ 387 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The table below sets forth our fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 . Level 1 Level 2 Level 3 Total March 31, 2020 Assets: Convertible debt investment $ — $ — $ 62,194 $ 62,194 Deferred compensation assets — 24,220 — 24,220 Total assets $ — $ 24,220 $ 62,194 $ 86,414 Liabilities: Interest rate swaps $ — $ 2,822 $ — $ 2,822 Total liabilities $ — $ 2,822 $ — $ 2,822 December 31, 2019 Assets: Convertible debt investment — — 49,542 49,542 Deferred compensation assets — 27,445 — 27,445 Total assets $ — $ 27,445 $ 49,542 $ 76,987 Liabilities: Interest rate swap $ — $ 546 $ — $ 546 Total liabilities $ — $ 546 $ — $ 546 |
Convertible senior notes | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The table below sets forth the changes in the balance of the convertible debt investment for the three months ended March 31, 2020 . Convertible Debt Investment Balance as of December 31, 2019 $ 49,542 Purchases 13,000 Change in fair value of convertible debt investment (348 ) Balance as of March 31, 2020 $ 62,194 |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Components of Other Comprehensive Income (Loss), Net of Tax | The table below sets forth the components of other comprehensive income (loss), net of tax, for the three months ended March 31, 2020 and 2019 . Three Months Ended Three Months Ended Before Tax Net of Before Tax Net of Other comprehensive income (loss): Foreign currency translation adjustments $ (779 ) $ — $ (779 ) $ 316 $ — $ 316 Unrealized gain (loss) on investment $ (348 ) $ 90 $ (258 ) $ 3,609 $ (952 ) $ 2,657 Unrealized gain (loss) on cash flow hedges: Change in fair value $ (2,272 ) $ 590 $ (1,682 ) $ (247 ) $ 65 $ (182 ) Reclassification adjustments into earnings (4 ) 1 (3 ) (74 ) 19 (55 ) Net unrealized gain (loss) $ (2,276 ) $ 591 $ (1,685 ) $ (321 ) $ 84 $ (237 ) Other comprehensive income (loss) $ (3,403 ) $ 681 $ (2,722 ) $ 3,604 $ (868 ) $ 2,736 |
Components of Accumulated Other Comprehensive Income (Loss), Net of Tax | Accumulated other comprehensive income, net of tax, includes the following components: Foreign Currency Translation Available-for-Sale Investment Cash Flow Hedges Total Balance, December 31, 2019 $ (566 ) $ 15,882 $ (380 ) $ 14,936 Current period change (779 ) (258 ) (1,685 ) (2,722 ) Balance, March 31, 2020 $ (1,345 ) $ 15,624 $ (2,065 ) $ 12,214 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Components of Segment Information | The table below sets forth information about our operating segments for the three months ended March 31, 2020 and 2019 , along with the items necessary to reconcile the segment information to the totals reported in the accompanying consolidated financial statements. Three Months Ended 2020 2019 Healthcare: Revenues $ 95,578 $ 93,682 Operating income $ 24,050 $ 27,851 Segment operating income as a percentage of segment revenues 25.2 % 29.7 % Business Advisory: Revenues $ 64,905 $ 58,806 Operating income $ 9,842 $ 9,581 Segment operating income as a percentage of segment revenues 15.2 % 16.3 % Education: Revenues $ 62,136 $ 51,957 Operating income $ 13,116 $ 12,618 Segment operating income as a percentage of segment revenues 21.1 % 24.3 % Total Company: Revenues $ 222,619 $ 204,445 Reimbursable expenses 19,303 18,617 Total revenues and reimbursable expenses $ 241,922 $ 223,062 Segment operating income $ 47,008 $ 50,050 Items not allocated at the segment level: Other operating expenses 27,146 36,578 Litigation and other gains (150 ) (456 ) Depreciation and amortization 6,047 7,172 Goodwill impairment charges 1 59,816 — Other expense, net 7,637 2,041 Income (loss) from continuing operations before taxes $ (53,488 ) $ 4,715 (1) The goodwill impairment charges are not allocated at the segment level because the underlying goodwill asset is reflective of our corporate investment in the segments. We do not include the impact of goodwill impairment charges in our evaluation of segment performance. |
Disaggregation of Revenue | The following table illustrates the disaggregation of revenues by billing arrangements, employee types, and timing of revenue recognition, including a reconciliation of the disaggregated revenues to revenues from our three operating segments for the three months ended March 31, 2020 and 2019. Three Months Ended March 31, 2020 Healthcare Business Advisory Education Total Billing Arrangements Fixed-fee $ 55,785 $ 25,393 $ 13,175 $ 94,353 Time and expense 14,733 37,589 43,711 96,033 Performance-based 18,921 646 — 19,567 Software support, maintenance and subscriptions 6,139 1,277 5,250 12,666 Total $ 95,578 $ 64,905 $ 62,136 $ 222,619 Employee Type (1) Revenue generated by full-time billable consultants $ 65,445 $ 61,957 $ 53,436 $ 180,838 Revenue generated by full-time equivalents 30,133 2,948 8,700 41,781 Total $ 95,578 $ 64,905 $ 62,136 $ 222,619 Timing of Revenue Recognition Revenue recognized over time $ 94,459 $ 64,905 $ 62,022 $ 221,386 Revenue recognized at a point in time 1,119 — 114 1,233 Total $ 95,578 $ 64,905 $ 62,136 $ 222,619 Three Months Ended March 31, 2019 Healthcare Business Advisory Education Total Billing Arrangements Fixed-fee $ 63,584 $ 21,672 $ 12,383 $ 97,639 Time and expense 12,763 35,309 35,358 83,430 Performance-based 11,810 664 — 12,474 Software support, maintenance and subscriptions 5,525 1,161 4,216 10,902 Total $ 93,682 $ 58,806 $ 51,957 $ 204,445 Employee Type (1) Revenue generated by full-time billable consultants $ 64,818 $ 57,094 $ 46,007 $ 167,919 Revenue generated by full-time equivalents 28,864 1,712 5,950 36,526 Total $ 93,682 $ 58,806 $ 51,957 $ 204,445 Timing of Revenue Recognition Revenue recognized over time $ 91,642 $ 58,806 $ 51,711 $ 202,159 Revenue recognized at a point in time 2,040 — 246 2,286 Total $ 93,682 $ 58,806 $ 51,957 $ 204,445 (1) Full-time billable consultants consist of our full-time professionals who provide consulting services to our clients and are billable to our clients based on the number of hours worked. Full-time equivalent professionals consist of leadership coaches and their support staff within our Healthcare Leadership solution, consultants who work variable schedules as needed by our clients, and full-time employees who provide software support and maintenance services to our clients. |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Goodwill [Line Items] | |||
Goodwill | $ 1,042,756 | ||
Accumulated impairment losses | (396,076) | ||
Goodwill, Impairment Loss | $ (59,816) | $ 0 | |
Goodwill, Foreign Currency Translation Gain (Loss) | (629) | ||
Goodwill, net ending balance | 586,235 | 646,680 | |
Healthcare | |||
Goodwill [Line Items] | |||
Goodwill | 636,810 | ||
Accumulated impairment losses | (208,081) | ||
Goodwill, Impairment Loss | 0 | ||
Goodwill, Foreign Currency Translation Gain (Loss) | 0 | ||
Goodwill, net ending balance | 428,729 | 428,729 | |
Education [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 103,889 | ||
Accumulated impairment losses | 0 | ||
Goodwill, Impairment Loss | 0 | ||
Goodwill, Foreign Currency Translation Gain (Loss) | 0 | ||
Goodwill, net ending balance | 103,889 | 103,889 | |
Business Advisory | |||
Goodwill [Line Items] | |||
Goodwill | 302,057 | ||
Accumulated impairment losses | (187,995) | ||
Goodwill, Impairment Loss | 59,816 | ||
Goodwill, Foreign Currency Translation Gain (Loss) | (629) | ||
Goodwill, net ending balance | $ 53,617 | $ 114,062 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Intangible assets | ||
Gross Carrying Amount | $ 124,769 | $ 125,221 |
Accumulated Amortization | 96,642 | 93,596 |
Customer Relationships [Member] | ||
Intangible assets | ||
Gross Carrying Amount | 87,379 | 87,577 |
Accumulated Amortization | $ 64,265 | 61,882 |
Customer Relationships [Member] | Minimum | ||
Intangible assets | ||
Useful Life (in years) | 3 years | |
Customer Relationships [Member] | Maximum | ||
Intangible assets | ||
Useful Life (in years) | 13 years | |
Trade Names [Member] | ||
Intangible assets | ||
Gross Carrying Amount | $ 28,930 | 28,930 |
Accumulated Amortization | $ 26,192 | 25,894 |
Trade Names [Member] | Minimum | ||
Intangible assets | ||
Useful Life (in years) | 5 years | |
Trade Names [Member] | Maximum | ||
Intangible assets | ||
Useful Life (in years) | 6 years | |
Technology And Software [Member] | ||
Intangible assets | ||
Useful Life (in years) | 5 years | |
Gross Carrying Amount | $ 5,440 | 5,694 |
Accumulated Amortization | $ 4,456 | 4,321 |
Noncompete Agreements [Member] | ||
Intangible assets | ||
Useful Life (in years) | 5 years | |
Gross Carrying Amount | $ 2,220 | 2,220 |
Accumulated Amortization | $ 1,559 | 1,447 |
Customer Contracts [Member] | ||
Intangible assets | ||
Useful Life (in years) | 2 years | |
Gross Carrying Amount | $ 800 | 800 |
Accumulated Amortization | $ 170 | $ 52 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Amortization Expense (Detail) $ in Thousands | Mar. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | $ 12,561 |
Estimated annual intangible assets amortization expense, Year Two | 8,358 |
Estimated annual intangible assets amortization expense, Year Three | 6,111 |
Estimated annual intangible assets amortization expense, Year Four | 3,512 |
Estimated annual intangible assets amortization expense, Year Five | $ 741 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Goodwill [Line Items] | |||
Goodwill, Impairment Loss | $ 59,816 | $ 0 | |
Goodwill | 586,235 | $ 646,680 | |
Amortization of Intangible Assets | 3,200 | $ 4,500 | |
Strategy and Innovation [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Impairment Loss | 49,900 | ||
Goodwill | 37,500 | ||
Life Sciences [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Impairment Loss | $ 9,900 |
Revenues Revenue - Additional I
Revenues Revenue - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 222,619 | $ 204,445 | |
Contract with Customer, Performance Obligation Satisfied in Previous Period | 7,900 | ||
Revenue, Remaining Performance Obligation, Amount | 92,500 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Contract with Customer, Asset, after Allowance for Credit Loss | 12,400 | $ 12,600 | |
Contract Asset, Period Increase (Decrease) | 200 | ||
Deferred revenues | 30,010 | $ 28,443 | |
Increase (decrease) in deferred revenues | 1,600 | ||
Deferred Revenue, Revenue Recognized | 14,400 | ||
Change in Estimated Variable Consideration [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Contract with Customer, Performance Obligation Satisfied in Previous Period | 4,800 | 1,200 | |
Release of Allowance [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Contract with Customer, Performance Obligation Satisfied in Previous Period | $ 3,100 | $ 3,900 |
Revenues Performance Obligation
Revenues Performance Obligations Information (Details) $ in Millions | Mar. 31, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 92.5 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 49.6 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 28.2 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 14.7 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 5 years |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Income (Loss) from Continuing Operations, Net of Tax, Attributable to Parent | $ (42,273) | $ 3,350 |
Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent | (35) | (46) |
Net income | $ (42,308) | $ 3,304 |
Weighted average common shares outstanding – basic | 21,827 | 21,868 |
Weighted average common stock equivalents | 0 | 443 |
Weighted average common shares outstanding – diluted | 21,827 | 22,311 |
Net earnings (loss) per basic share: | ||
Income (Loss) from Continuing Operations, Per Basic Share | $ (1.94) | $ 0.15 |
Discontinued Operation, Income (Loss) from Discontinued Operation, Net of Tax, Per Basic Share | 0 | 0 |
Basic (USD per share) | (1.94) | 0.15 |
Net earnings per diluted share: | ||
Income (Loss) from Continuing Operations, Per Diluted Share | (1.94) | 0.15 |
Discontinued Operation, Income (Loss) from Discontinued Operation, Net of Tax, Per Diluted Share | 0 | 0 |
Diluted (USD per share) | $ (1.94) | $ 0.15 |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Anti-dilutive Securities Excluded from Computation of Weighted Average Common Stock Equivalents (Detail) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total anti-dilutive securities | 4,207 | 6,270 |
Unvested restricted stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total anti-dilutive securities | 992 | 12 |
Share-based Payment Arrangement, Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total anti-dilutive securities | 86 | 0 |
Convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total anti-dilutive securities | 0 | 3,129 |
Warrants related to the issuance of convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total anti-dilutive securities | 3,129 | 3,129 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Accelerated Share Repurchases [Line Items] | ||
Stock Repurchased and Retired During Period, Shares | 313,998 | |
Stock Repurchased and Retired During Period, Value | $ 20,881,000 | |
Stock Purchase Initiated but not yet Settled, Shares | 18,000 | |
Share Repurchases Initiated but not yet Settled | $ 1,200,000 | |
Share Repurchase Program [Member] | ||
Accelerated Share Repurchases [Line Items] | ||
Share repurchase authorized amount | 125,000,000 | |
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 100,000 |
Financing Arrangements - Summar
Financing Arrangements - Summary of Carrying Amounts of Debt (Detail) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2017 |
Debt Instrument [Line Items] | |||
Net carrying amount | $ 451,722 | $ 208,853 | |
Long-term Debt, Current Maturities | (533) | (529) | |
Long-term debt, net of current portion | 451,189 | 208,324 | |
Senior secured credit facility | |||
Debt Instrument [Line Items] | |||
Net carrying amount | 448,000 | 205,000 | |
Promissory Note due 2024 [Member] | |||
Debt Instrument [Line Items] | |||
Net carrying amount | $ 3,722 | $ 3,853 | $ 5,100 |
Financing Arrangements Schedule
Financing Arrangements Schedule of Maturities of Long-Term Debt (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months | $ 398 |
Long-term Debt, Maturities, Repayments of Principal in Year Two | 544 |
Long-term Debt, Maturities, Repayments of Principal in Year Three | 559 |
Long-term Debt, Maturities, Repayments of Principal in Year Four | 575 |
Long-term Debt, Maturities, Repayments of Principal in Year Five | $ 449,646 |
Financing Arrangements - Summ_2
Financing Arrangements - Summary of Interest Expense Recognized (Detail) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Interest Expense Recognized [Line Items] | |
Interest Expense, Debt, Excluding Amortization | $ 781 |
Amortization of Debt Discount (Premium) | 2,120 |
Amortization of Debt Issuance Costs | 315 |
1.25% convertible senior notes due 2019 | |
Interest Expense Recognized [Line Items] | |
Interest Expense, Debt | $ 3,216 |
Financing Arrangements - Additi
Financing Arrangements - Additional Information (Detail) $ / shares in Units, shares in Millions | Mar. 16, 2020 | Jan. 30, 2020 | Jun. 30, 2017USD ($) | Jun. 22, 2017 | Mar. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2014USD ($)$ / sharesshares |
Debt Instrument [Line Items] | |||||||||
Effective interest rate of debt | 4.751% | ||||||||
Net carrying amount | $ 451,722,000 | $ 208,853,000 | |||||||
Duration of LIBOR | 1 month | 1 month | 1 month | ||||||
Property and equipment, net | $ 38,326,000 | 38,413,000 | |||||||
Warrants related to the issuance of convertible senior notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Common stock purchased | shares | 3.1 | ||||||||
Common stock price per share | $ / shares | $ 97.12 | ||||||||
1.25% convertible senior notes due 2019 | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | $ 250,000,000 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.25% | ||||||||
1.25% convertible senior notes due 2019 | Minimum | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion price of convertible notes | $ / shares | $ 79.89 | ||||||||
1.25% convertible senior notes due 2019 | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Conversion price of convertible notes | $ / shares | $ 97.12 | ||||||||
Senior secured credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Revolving Credit facility | $ 600,000,000 | $ 600,000,000 | |||||||
Credit agreement expiration date | Sep. 27, 2024 | ||||||||
Option to increase revolving credit facility | $ 150,000,000 | ||||||||
Maximum principle amount | $ 750,000,000 | $ 750,000,000 | |||||||
Percentage of other equity interests in domestic subsidiaries | 100.00% | ||||||||
Percentage of other equity interests in foreign subsidiaries | 65.00% | ||||||||
Maximum consolidated leverage ratio | 3.75 | ||||||||
Debt Instrument, Covenant, Consolidated Leverage Ratio, Additional Increase | 4 | ||||||||
Minimum consolidated interest coverage ratio | 3.50 | 3.50 | |||||||
Actual consolidated leverage ratio | 3.48 | ||||||||
Actual interest coverage ratio | 15.13 | ||||||||
Net carrying amount | $ 448,000,000 | $ 205,000,000 | |||||||
Percentage of weighted average interest rate of borrowings | 2.30% | 3.00% | |||||||
Outstanding letters of credit | $ 1,600,000 | $ 1,700,000 | |||||||
Unused borrowing capacity under Credit Agreement | 150,400,000 | ||||||||
Senior secured credit facility | Minimum | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate on borrowings | 1.125% | ||||||||
Senior secured credit facility | Minimum | Base Rate [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate on borrowings | 0.125% | ||||||||
Senior secured credit facility | Maximum | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate on borrowings | 1.875% | ||||||||
Senior secured credit facility | Maximum | Base Rate [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate on borrowings | 0.875% | ||||||||
Promissory Note due 2024 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate on borrowings | 1.97% | ||||||||
Net carrying amount | $ 5,100,000 | 3,722,000 | 3,853,000 | ||||||
Debt Instrument, Maturity Date | Mar. 1, 2024 | ||||||||
Repayment of Principal at Maturity Date | $ 1,500,000 | ||||||||
Duration of LIBOR | 1 month | ||||||||
Aircraft [Domain] | |||||||||
Debt Instrument [Line Items] | |||||||||
Property and equipment, net | $ 4,900,000 | $ 5,100,000 |
Restructuring Charges - Additio
Restructuring Charges - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Restructuring Charges [Abstract] | |||
Selling, general and administrative expenses | $ 1,609 | $ 1,275 | |
Operating Lease, Impairment Loss | 0 | 740 | |
Restructuring reserve | 1,226 | $ 159 | |
Other Restructuring [Member] | |||
Restructuring Charges [Abstract] | |||
Selling, general and administrative expenses | 1,200 | ||
Restructuring reserve | 1,121 | 0 | |
Employee Severance [Member] | |||
Restructuring Charges [Abstract] | |||
Selling, general and administrative expenses | 300 | ||
Restructuring reserve | 14 | 68 | |
Office Space Reductions [Member] | |||
Restructuring Charges [Abstract] | |||
Restructuring reserve | 91 | $ 91 | |
Corporate, Non-Segment [Member] | Employee Severance [Member] | |||
Restructuring Charges [Abstract] | |||
Selling, general and administrative expenses | $ 100 | 200 | |
LakeOswegoOregon [Member] | |||
Restructuring Charges [Abstract] | |||
Operating Lease, Impairment Loss | 700 | ||
Restructuring and Related Cost, Accelerated Depreciation | $ 200 |
Restructuring Charges Restruc_2
Restructuring Charges Restructuring Liability Rollforward (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | $ 1,226 | $ 159 |
Restructuring and Related Cost, Incurred Cost | 1,599 | |
Payments for Restructuring | (540) | |
Restructuring Reserve, Accrual Adjustment | 8 | |
Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | 14 | 68 |
Restructuring and Related Cost, Incurred Cost | 411 | |
Payments for Restructuring | (473) | |
Restructuring Reserve, Accrual Adjustment | 8 | |
Office Space Reductions [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | 91 | 91 |
Restructuring and Related Cost, Incurred Cost | 0 | |
Payments for Restructuring | 0 | |
Restructuring Reserve, Accrual Adjustment | 0 | |
Other Restructuring [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | 1,121 | $ 0 |
Restructuring and Related Cost, Incurred Cost | 1,188 | |
Payments for Restructuring | (67) | |
Restructuring Reserve, Accrual Adjustment | $ 0 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activity - Additional Information (Detail) - USD ($) $ in Millions | Mar. 16, 2020 | Jan. 30, 2020 | Jun. 22, 2017 | Mar. 31, 2020 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Interest Rate Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months, Net | $ 1.4 | |||
Interest rate swap agreement, effective date | Feb. 28, 2020 | Dec. 31, 2019 | Aug. 31, 2017 | |
Interest rate swap agreement, end date | Feb. 28, 2025 | Dec. 31, 2024 | Aug. 31, 2022 | |
Interest rate swap agreement for a notional amount | $ 100 | $ 50 | $ 50 | |
Duration of LIBOR | 1 month | 1 month | 1 month | |
Percentage of fixed rate | 0.885% | 1.50% | 1.90% | |
Gain (loss) reclassification from accumulated OCI to income, estimate of time to transfer | 12 months |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activity - Fair Value Interest Rate Swaps Designated as Cash Flow Hedging Instruments (Detail) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Accrued Liabilities [Member] | ||
Fair Value interest rate swaps designated as cash flow hedging instruments | ||
Fair Value (Derivative Asset and Liability) | $ 1,156 | $ 159 |
Other Noncurrent Liabilities [Member] | ||
Fair Value interest rate swaps designated as cash flow hedging instruments | ||
Fair Value (Derivative Asset and Liability) | $ 1,666 | $ 387 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Asset/Liability | ||
Assets, fair value | $ 86,414 | $ 76,987 |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 2,822 | 546 |
Interest Rate Swap [Member] | ||
Fair Value, Asset/Liability | ||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 2,822 | 546 |
Convertible debt investment | ||
Fair Value, Asset/Liability | ||
Assets, fair value | 62,194 | 49,542 |
Level 2 | ||
Fair Value, Asset/Liability | ||
Assets, fair value | 24,220 | 27,445 |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 2,822 | 546 |
Level 2 | Interest Rate Swap [Member] | ||
Fair Value, Asset/Liability | ||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 2,822 | 546 |
Level 3 | ||
Fair Value, Asset/Liability | ||
Assets, fair value | 62,194 | 49,542 |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 0 | 0 |
Level 3 | Interest Rate Swap [Member] | ||
Fair Value, Asset/Liability | ||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 0 | |
Level 3 | Convertible debt investment | ||
Fair Value, Asset/Liability | ||
Assets, fair value | 62,194 | 49,542 |
Deferred Compensation Plan Assets [Member] | ||
Fair Value, Asset/Liability | ||
Assets, fair value | 24,220 | 27,445 |
Deferred Compensation Plan Assets [Member] | Level 2 | ||
Fair Value, Asset/Liability | ||
Assets, fair value | $ 24,220 | $ 27,445 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments Fair Value of Financial Instruments - Convertible Debt Investment Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Payments to Acquire Investments | $ 13,000 | $ 0 | |
Fair Value, Recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 86,414 | $ 76,987 | |
Convertible senior notes | Fair Value, Recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 62,194 | $ 49,542 | |
Shorelight Holdings Llc [Member] | Convertible senior notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss) | $ (348) |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investments in notes | $ 67,194 | $ 54,541 | |
Equity Securities without Readily Determinable Fair Value, Amount | $ 5,000 | ||
Convertible debt investment | Shorelight Holdings LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investments in notes | $ 13,000 | $ 27,900 | |
Debt Instrument, Interest Rate, Stated Percentage | 1.69% | ||
Debt Instrument, Maturity Date | Jan. 17, 2024 | ||
Measurement Input, Discount Rate [Member] | Convertible debt investment | Shorelight Holdings LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt Instrument, Measurement Input | 0.26 | ||
Measurement Input, Price Volatility [Member] | Convertible debt investment | Shorelight Holdings LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt Instrument, Measurement Input | 0.425 |
Other Comprehensive Income (L_3
Other Comprehensive Income (Loss )- Components of Other Comprehensive Loss, Net of Tax (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity [Abstract] | ||
Foreign currency translation adjustment, before taxes | $ (779) | $ 316 |
Foreign currency translation adjustment, taxes | 0 | 0 |
Foreign currency translation adjustment, net of taxes | (779) | 316 |
Unrealized gain on investment, before taxes | (348) | 3,609 |
Unrealized gain on investment, tax (expense) benefit | 90 | (952) |
Unrealized gain on investment, net of taxes | (258) | 2,657 |
Change in fair value, before taxes | (2,272) | (247) |
Change in fair value, tax (expense) benefit | 590 | 65 |
Change in fair value, net of taxes | (1,682) | (182) |
Reclassification adjustments into earnings, before taxes | (4) | (74) |
Reclassification adjustments into earnings, tax (expense) benefit | 1 | 19 |
Reclassification adjustments into earnings, net of taxes | (3) | (55) |
Net unrealized gain (loss), before taxes | (2,276) | (321) |
Net unrealized gain (loss), tax (expense) benefit | 591 | 84 |
Net unrealized gain (loss), net of taxes | (1,685) | (237) |
Other comprehensive income (loss), before taxes | (3,403) | 3,604 |
Other comprehensive income (loss), tax (expense) benefit | 681 | (868) |
Accumulated Other Comprehensive (Income) Loss, Current period change | $ (2,722) | $ 2,736 |
Other Comprehensive Income (L_4
Other Comprehensive Income (Loss )- Components of Accumulated Other Comprehensive Loss, Net of Tax (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity [Abstract] | ||
Foreign Currency Translation Adjustments, Beginning balance | $ (566) | |
Foreign currency translation adjustments, net of tax | (779) | $ 316 |
Foreign Currency Translation Adjustments, Ending balance | (1,345) | |
Net Unrealized Gain (Loss) on Investment, Beginning balance | 15,882 | |
Unrealized gain (loss) on investment, net of tax | (258) | 2,657 |
Net Unrealized Gain (Loss) on Investment, Ending balance | 15,624 | |
Net Unrealized Losses on Derivatives, Beginning balance | (380) | |
Unrealized loss on cash flow hedging instruments, net of tax | (1,685) | (237) |
Net Unrealized Losses on Derivatives, Ending balance | (2,065) | |
Accumulated Other Comprehensive Income (Loss), Beginning balance | 14,936 | |
Accumulated Other Comprehensive (Income) Loss, Current period change | (2,722) | $ 2,736 |
Accumulated Other Comprehensive Income (Loss), Ending balance | $ 12,214 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective Income Tax Rate Reconciliation, Prior Year Income Taxes, Amount | $ 800 | |
Effective Income Tax Rate Reconciliation, Percent | 21.00% | 29.00% |
Income tax expense (benefit) | $ (11,215) | $ 1,365 |
Income (loss) from continuing operations before taxes | $ (53,488) | $ 4,715 |
Effective Income Tax Rate Reconciliation, at Statutory Rate, Inclusive of State Income Tax, Percent | 26.00% | 26.40% |
Commitments, Contingencies an_2
Commitments, Contingencies and Guarantees - Additional Information (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Senior secured credit facility | ||
Commitments And Contingencies [Line Items] | ||
Guarantees in the form of letters of credit | $ 1.6 | $ 1.7 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2020Segment | |
Segment Reporting [Abstract] | |
Number of Operating Segments | 3 |
Segment Information - Component
Segment Information - Components of Segment Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Components of Segment Information | ||
Operating income (loss) | $ (45,851) | $ 6,756 |
Revenue from Contract with Customer, Including Assessed Tax | 222,619 | 204,445 |
Reimbursable Revenues | 19,303 | 18,617 |
Total revenues and reimbursable expenses | 241,922 | 223,062 |
Gain (Loss) Related To Litigation Settlement And Other Operating Gains | 150 | 456 |
Depreciation and amortization | 6,114 | 7,172 |
Goodwill, Impairment Loss | 59,816 | 0 |
Other expense, net | (7,637) | (2,041) |
Income from continuing operations before income tax expense | (53,488) | 4,715 |
Healthcare | ||
Components of Segment Information | ||
Revenue from Contract with Customer, Including Assessed Tax | 95,578 | 93,682 |
Goodwill, Impairment Loss | 0 | |
Business Advisory | ||
Components of Segment Information | ||
Revenue from Contract with Customer, Including Assessed Tax | 64,905 | 58,806 |
Goodwill, Impairment Loss | (59,816) | |
Education [Member] | ||
Components of Segment Information | ||
Revenue from Contract with Customer, Including Assessed Tax | 62,136 | 51,957 |
Goodwill, Impairment Loss | 0 | |
Operating Segments | ||
Components of Segment Information | ||
Operating income (loss) | 47,008 | 50,050 |
Revenue from Contract with Customer, Including Assessed Tax | 222,619 | 204,445 |
Reimbursable Revenues | 19,303 | 18,617 |
Total revenues and reimbursable expenses | 241,922 | 223,062 |
Operating Segments | Healthcare | ||
Components of Segment Information | ||
Operating income (loss) | $ 24,050 | $ 27,851 |
Segment operating income as a percentage of segment revenues | 25.20% | 29.70% |
Revenue from Contract with Customer, Including Assessed Tax | $ 95,578 | $ 93,682 |
Operating Segments | Business Advisory | ||
Components of Segment Information | ||
Operating income (loss) | $ 9,842 | $ 9,581 |
Segment operating income as a percentage of segment revenues | 15.20% | 16.30% |
Revenue from Contract with Customer, Including Assessed Tax | $ 64,905 | $ 58,806 |
Operating Segments | Education [Member] | ||
Components of Segment Information | ||
Operating income (loss) | $ 13,116 | $ 12,618 |
Segment operating income as a percentage of segment revenues | 21.10% | 24.30% |
Revenue from Contract with Customer, Including Assessed Tax | $ 62,136 | $ 51,957 |
Segment Reconciling Items | ||
Components of Segment Information | ||
Other operating expenses | 27,146 | 36,578 |
Gain (Loss) Related To Litigation Settlement And Other Operating Gains | (150) | (456) |
Depreciation and amortization | 6,047 | 7,172 |
Other expense, net | $ 7,637 | $ 2,041 |
Segment Information Segment Inf
Segment Information Segment Information - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | $ 222,619 | $ 204,445 |
Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 95,578 | 93,682 |
Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 64,905 | 58,806 |
Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 62,136 | 51,957 |
Transferred over Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 221,386 | 202,159 |
Transferred over Time [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 94,459 | 91,642 |
Transferred over Time [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 64,905 | 58,806 |
Transferred over Time [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 62,022 | 51,711 |
Transferred at Point in Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 1,233 | 2,286 |
Transferred at Point in Time [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 1,119 | 2,040 |
Transferred at Point in Time [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 0 | 0 |
Transferred at Point in Time [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 114 | 246 |
Full-time Billable Consultants [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 180,838 | 167,919 |
Full-time Billable Consultants [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 65,445 | 64,818 |
Full-time Billable Consultants [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 61,957 | 57,094 |
Full-time Billable Consultants [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 53,436 | 46,007 |
Full-time Equivalents [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 41,781 | 36,526 |
Full-time Equivalents [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 30,133 | 28,864 |
Full-time Equivalents [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 2,948 | 1,712 |
Full-time Equivalents [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 8,700 | 5,950 |
Fixed-price Contract [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 94,353 | 97,639 |
Fixed-price Contract [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 55,785 | 63,584 |
Fixed-price Contract [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 25,393 | 21,672 |
Fixed-price Contract [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 13,175 | 12,383 |
Time-and-materials Contract [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 96,033 | 83,430 |
Time-and-materials Contract [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 14,733 | 12,763 |
Time-and-materials Contract [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 37,589 | 35,309 |
Time-and-materials Contract [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 43,711 | 35,358 |
Performance-based [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 19,567 | 12,474 |
Performance-based [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 18,921 | 11,810 |
Performance-based [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 646 | 664 |
Performance-based [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 0 | 0 |
Software Service, Support and Maintenance Arrangement [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 12,666 | 10,902 |
Software Service, Support and Maintenance Arrangement [Member] | Healthcare | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 6,139 | 5,525 |
Software Service, Support and Maintenance Arrangement [Member] | Business Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 1,277 | 1,161 |
Software Service, Support and Maintenance Arrangement [Member] | Education [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | $ 5,250 | $ 4,216 |