Business Overview
Huron Consulting Group Inc. is a global professional services firm that partners with clients to develop growth strategies, optimize operations, and accelerate digital transformation. By leveraging its deep industry expertise and broad range of capabilities, Huron empowers organizations across the healthcare, education, and commercial sectors to navigate complex challenges and achieve lasting success.Huron's operations are organized into three reportable segments: Healthcare, Education, and Commercial. The Healthcare segment serves acute and non-acute care providers, payors, and long-term care facilities, offering a comprehensive suite of services and solutions to address financial, operational, and strategic needs. The Education segment caters to public and private colleges, universities, research institutes, and other education-related organizations, providing digital offerings, research-focused consulting, and strategy and operations services. The Commercial segment focuses on serving industries and organizations facing significant disruption, helping them adapt to rapidly changing environments and accelerate business transformation.
Across these segments, Huron delivers its services and products through two principal capabilities: Consulting and Managed Services, and Digital. The Consulting and Managed Services capability encompasses the firm's management consulting, managed services, and outsourcing offerings, while the Digital capability represents its technology and analytics services, including technology-related managed services, and software products.
Financials
In the fiscal year ended December 31, 2023, Huron reported annual revenues of $1,398,755,000 and net income of $62,479,000. The company's annual operating cash flow was $135,262,000, and its annual free cash flow was $100,076,000.For the second quarter of 2024, Huron reported revenues of $371,654,000, up 7.2% from the same period in the prior year. Net income for the quarter was $37,482,000, an increase of 51.7% compared to the second quarter of 2023. The company's operating cash flow for the quarter was $107,200,000, and its free cash flow was $103,535,000.
Segment Performance
Huron's Healthcare segment generated 51% of total company revenues during the first quarter of 2024, posting revenues of $180,700,000, up 21.3% from the same period in the prior year. The increase in revenues was driven by strong demand for the segment's performance improvement, digital, strategy and innovation, and financial advisory offerings.The Education segment contributed 31% of total company revenues in the first quarter of 2024, posting revenues of $111,600,000, up 7.1% from the same period in the prior year. The increase in revenues was primarily driven by strong demand for the segment's technology and analytics services and software products within its Digital capability.
The Commercial segment generated 18% of total company revenues in the first quarter of 2024, posting revenues of $63,600,000, largely flat compared to the same period in the prior year. The segment experienced increases in demand for its financial advisory offerings, offset by declines in its strategy and innovation and digital offerings.
Guidance and Outlook
For the full year 2024, Huron affirmed its revenue guidance, with revenues before reimbursable expenses expected to be in the range of $1.46 billion to $1.54 billion. The company also affirmed its adjusted EBITDA margin guidance, which is expected to be in the range of 12.8% to 13.3% of revenues. Additionally, Huron raised its adjusted non-GAAP earnings per share guidance to a range of $5.60 to $6.10, reflecting a lower anticipated full year effective tax rate and a lower weighted average diluted share base due to the accelerated pace of share repurchases during the first quarter.Liquidity
As of June 30, 2024, Huron had $17,646,000 in cash and cash equivalents and $511,600,000 in total debt, resulting in net debt of $493,954,000. The company's leverage ratio, as defined in its senior bank agreement, was 2.24x adjusted EBITDA as of June 30, 2024.Huron's capital allocation strategy focuses on a balanced approach, including share repurchases, debt repayment, and tuck-in acquisitions. During the first six months of 2024, the company repurchased 1,001,191 shares of its common stock for $96,685,000, representing 5.4% of its outstanding shares as of December 31, 2023. As of June 30, 2024, $89,948,000 remained available for share repurchases under the company's current authorization.