Huron Consulting Group Files Q3 2024 10-Q

TL;DR

Huron Consulting Group's Q3 2024 10-Q is in. Check financials for latest performance.

AI Summary

Huron Consulting Group Inc. filed its 10-Q for the period ending September 30, 2024. The filing covers the third quarter and the first nine months of the fiscal year. Key financial data and operational details for this period are presented, reflecting the company's performance and financial position.

Why It Matters

This filing provides investors and analysts with the latest financial performance data for Huron Consulting Group, crucial for understanding the company's trajectory and making informed investment decisions.

Risk Assessment

Risk Level: low — This is a standard quarterly financial filing with no immediate red flags or significant new risks disclosed.

Key Players & Entities

• Huron Consulting Group Inc. (company) — Filer
• 2024-09-30 (date) — Reporting Period End Date
• 2024-10-29 (date) — Filing Date
• 550 WEST VAN BUREN STREET (address) — Company Business Address
• CHICAGO (location) — Company City
• IL (location) — Company State
• 60607 (zip_code) — Company Zip Code

FAQ

Key Financial Figures

• $0.01 — ich registered Common Stock, par value $0.01 per share HURN NASDAQ Global Select Mar
• $1.12 billion — d 2023, we recognized total revenues of $1.12 billion and $1.05 billion, respectively. Of the
• $1.05 b — zed total revenues of $1.12 billion and $1.05 billion, respectively. Of the $1.12 billi
• $1.05 billion — m clients and unbilled services. Of the $1.05 billion total revenues recognized in the first

Filing Documents

• hurn-20240930.htm (10-Q) — 1646KB
• hurn2024930exhibit311.htm (EX-31.1) — 12KB
• hurn2024930exhibit312.htm (EX-31.2) — 13KB
• hurn2024930exhibit321.htm (EX-32.1) — 8KB
• hurn2024930exhibit322.htm (EX-32.2) — 8KB
• 0001289848-24-000209.txt ( ) — 7955KB
• hurn-20240930.xsd (EX-101.SCH) — 44KB
• hurn-20240930_cal.xml (EX-101.CAL) — 76KB
• hurn-20240930_def.xml (EX-101.DEF) — 254KB
• hurn-20240930_lab.xml (EX-101.LAB) — 612KB
• hurn-20240930_pre.xml (EX-101.PRE) — 450KB
• hurn-20240930_htm.xml (XML) — 1284KB

– Financial Information

Part I – Financial Information

Consolidated Financial Statements (Unaudited)

Item 1. Consolidated Financial Statements (Unaudited) Consolidated Balance Sheets 1 Consolidated Statements of Operations and Other Comprehensive Income 2 Consolidated Statements of Stockholders' Equity 3 Consolidated Statements of Cash Flows 4

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 5

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 21

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 41

Controls and Procedures

Item 4. Controls and Procedures 42

– Other Information

Part II – Other Information

Legal Proceedings

Item 1. Legal Proceedings 42

Risk Factors

Item 1A. Risk Factors 42

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 42

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 43

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 43

Other Information

Item 5. Other Information 43

Exhibits

Item 6. Exhibits 44 Signature 45 Table of Contents

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS HURON CONSULTING GROUP INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) (Unaudited) September 30, 2024 December 31, 2023 Assets Current assets: Cash and cash equivalents $ 18,497 $ 12,149 Receivables from clients, net of allowances of $ 15,707 and $ 17,284 , respectively 204,894 162,566 Unbilled services, net of allowances of $ 3,064 and $ 5,984 , respectively 177,437 190,869 Income tax receivable 9,192 6,385 Prepaid expenses and other current assets 27,789 28,491 Total current assets 437,809 400,460 Property and equipment, net 21,682 23,728 Deferred income taxes, net 2,408 2,288 Long-term investments 64,319 75,414 Operating lease right-of-use assets 21,026 24,131 Other non-current assets 111,448 92,336 Intangible assets, net 22,547 18,074 Goodwill 647,541 625,711 Total assets $ 1,328,780 $ 1,262,142 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 8,151 $ 10,074 Accrued expenses and other current liabilities 26,490 33,087 Accrued payroll and related benefits 183,182 225,921 Current maturities of long-term debt 13,750 — Current maturities of operating lease liabilities 11,990 11,032 Deferred revenues 27,703 22,461 Total current liabilities 271,266 302,575 Non-current liabilities: Deferred compensation and other liabilities 44,322 35,665 Long-term debt, net of current portion 428,204 324,000 Operating lease liabilities, net of current portion 33,442 38,850 Deferred income taxes, net 28,774 28,160 Total non-current liabilities 534,742 426,675 Commitments and contingencies Stockholders' equity Common stock; $ 0.01 par value; 500,000,000 shares authorized; 20,793,202 and 21,316,441 shares issued, respectively 207 212 Treasury stock, at cost, 3,062,689 and 2,852,296 shares, respectively ( 159,717 ) ( 142,136 ) Additional paid-in capital 174,872 236,962 Retained earnings 497,664 415,027 Accumulated other comprehensive

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Tabular amounts in thousands, except per share amounts) (Unaudited) 1. Description of Business Huron is a global professional services firm that collaborates with clients to put possible into practice by creating sound strategies, optimizing operations, accelerating digital transformation, and empowering businesses and their people 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. We provide our services and products and manage our business under three operating segments: Healthcare, Education, and Commercial, which align our business by industry. The Commercial segment includes all industries outside of healthcare and education, including, but not limited to, financial services and energy and utilities. We also provide revenue reporting across two principal capabilities: i) Consulting and Managed Services and ii) Digital, which are methods by which we deliver our services and products. See Note 14 "Segment Information" for more information on each of our segments and their solutions. 2. 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 and nine months ended September 30, 2024 and 2023. 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 ou

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Tabular amounts in thousands, except per share amounts) (Unaudited) On March 6, 2024, the SEC adopted the final rule under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors , which will require registrants to disclose certain climate-related information in registration statements and annual reports. The disclosure requirements will be effective for our annual reporting periods beginning with the fiscal year ending December 31, 2025, subject to any delay which may result from the current administrative stay issued by the SEC. We expect the adoption will have no impact on our financial position or our results of operations, but we are currently evaluating the impact this guidance will have on our disclosures within our consolidated financial statements. 4. Goodwill and Intangible Assets Goodwill The table below sets forth the changes in the carrying value of goodwill by reportable segment for the nine months ended September 30, 2024. Healthcare Education Commercial Total Balance as of December 31, 2023: Goodwill $ 644,983 $ 123,652 $ 312,968 $ 1,081,603 Accumulated impairment losses ( 190,024 ) ( 1,417 ) ( 264,451 ) ( 455,892 ) Goodwill, net as of December 31, 2023 $ 454,959 $ 122,235 $ 48,517 $ 625,711 Goodwill recorded in connection with business acquisitions — 21,677 76 21,753 Foreign currency translation — 77 — 77 Goodwill, net as of September 30, 2024 $ 454,959 $ 143,989 $ 48,593 $ 647,541 2024 Acquisitions On January 1, 2024, we completed the acquisition of the data analytics services team of Vlamis Software Solutions, Inc. ("Vlamis"). The results of operations of Vlamis are included within our consolidated financial statements as of the acquisition date and allocated among our Education and Commercial segments based on the engagements delivered by the business. On March 1, 2024, we completed the acquisition of Grenzebach Glier and Associate

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Tabular amounts in thousands, except per share amounts) (Unaudited) Intangible Assets Intangible assets as of September 30, 2024 and December 31, 2023 consisted of the following: As of September 30, 2024 As of December 31, 2023 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Customer relationships 5 to 10 $ 26,661 $ 9,022 $ 60,636 $ 48,928 Technology and software 2 to 5 16,230 12,127 16,230 10,195 Trade names 6 6,000 6,000 6,000 6,000 Non-competition agreements 3 to 5 950 545 720 389 Customer contracts 1 to 4 702 302 — — Total $ 50,543 $ 27,996 $ 83,586 $ 65,512 Identifiable intangible assets with finite lives are amortized over their estimated useful lives using either an accelerated or straight-line basis to correspond to the cash flows expected to be derived from the assets. Intangible asset amortization expense was $ 1.6 million and $ 2.0 million for the three months ended September 30, 2024 and 2023, respectively; and $ 4.9 million and $ 6.2 million for the nine months ended September 30, 2024 and 2023, respectively. The table below sets forth the estimated annual amortization expense for the intangible assets recorded as of September 30, 2024. Year Ending December 31, Estimated Amortization Expense 2024 $ 6,518 2025 $ 6,719 2026 $ 4,974 2027 $ 3,582 2028 $ 2,626 Actual future amortization expense could differ from these estimated amounts as a result of future acquisitions, dispositions, and other factors. 5. Revenues For the three months ended September 30, 2024 and 2023, we recognized total revenues of $ 378.1 million and $ 367.5 million, respectively. Of the $ 378.1 million total revenues recognized in the third quarter of 2024, we recognized $ 10.9 million from obligations satisfied, or partially satisfied, in prior periods, of which $ 9.1 million was due to changes in the estimates of our variable consideration

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Tabular amounts in thousands, except per share amounts) (Unaudited) 2025, and the remaining $ 84.9 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, net balance as of September 30, 2024 and December 31, 2023 was $ 55.4 million and $ 70.1 million, respectively. The $ 14.7 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 accounting policy. Our deferred revenues balance as of September 30, 2024 and December 31, 2023 was $ 27.7 million and $ 22.5 million, respectively. The $ 5.2 million increase reflects timing differences between client payments in accordance with their contract terms and the completion of our performance obligations. For the three and nine months ended September 30, 2024, $ 1.7 million and $ 21.3 million of revenues

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