FTI CONSULTING, INC - Annual Report: 2019 (Form 10-K)

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•	Corporate Finance & Restructuring;

•	Forensic and Litigation Consulting;

•	Economic Consulting;

•	Technology; and

•	Strategic Communications.

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Turnaround, Restructuring and Bankruptcy. We provide advisory services to help our clients stabilize finances and operations to reassure creditors and other stakeholders that proactive steps are being taken to preserve and enhance value. For clients confronting liquidity problems, excessive leverage, underperformance, overexpansion, or other business or financial issues, we develop liquidity forecasts, identify cash flow improvements, obtain financing, negotiate loan covenant waivers and guide complex debt restructuring.

•	Business Transformation. The services offered by our business transformation practice focus on supporting clients through transformational change, disruption and M&A to drive sustainable growth and value. Dedicated to working alongside our clients at every stage of the business lifecycle, our experts focus on:

•	Revenue Growth, including sales effectiveness, market, product and customer strategy, pricing, and profitability.

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•	Operations, including strategic sourcing and procurement, optimizing the supply chain and operating network, increasing the efficiency of manufacturing and implementing lean best practices to enhance profitability and organizational effectiveness.

•	Finance, addressing people, process and technology gaps by utilizing data analytics and best practices to establish solutions that support finance responsibilities while balancing the company’s strategic goals.

•	People, partnering with business leaders, management and human resources professionals, to help organizations fully realize transformational change by addressing human capital needs, including organizational design and workforce optimization, culture and change management, employee engagement, executive compensation, and people analytics.

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Transactions. Advising both corporate and financial clients across the deal life cycle, we support clients to strategize, structure, diligence, integrate, carve out, value and communicate around a transaction. Services include, quality of earnings and pre-deal assessment, transaction structuring, due diligence, synergy, risk, valuation and operating efficiency identification, valuation, post-deal integration and carve-out services, as well as implementation work. In addition to our core transactions offerings, we provide:

•	Investment Banking Services. We provide investment banking services in the U.S. and other countries, including Canada and Puerto Rico, through financial industry regulated entities, focusing on identifying and executing value-added transactions for public and private middle market companies. We can also provide investment advisory services through our registered advisors.

•	Valuation & Financial Advisory Services. We provide an array of forecasting, valuation and transaction support services with respect to strategic transactions, including capital markets, M&A and distressed situations. We have the expertise to provide fairness, solvency, collateral valuation, intellectual asset valuation, and going concern valuation options.

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Tax Services. We advise businesses on a variety of tax matters ranging from tax transaction support to best practice process implementation and structuring. We provide advisory services relating to corporate, partnership, real estate investment trust (“REIT”) and real estate tax compliance and reporting, international taxation, debt restructuring, foreign, state and local taxes, research and development, transfer pricing, tax valuation services and value-added taxation.

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Interim Management. Through interim management services, our professionals fill the void when our clients need skilled, experienced leadership to pursue opportunities, contend with executive turnover and transition, or drive strategic transactions or change. The experienced and credentialed professionals in our interim management practice assume executive officer level roles, providing the leadership, financial management, and operating and strategic decision-making abilities to lead transitions due to extraordinary events such as M&A, divestitures, changes in control and carve-outs of businesses from larger enterprises.

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Dispute Advisory. We provide independent litigation consulting, including bankruptcy and avoidance litigation and industry-specific civil, commercial and regulatory dispute services. Our bankruptcy and avoidance litigation services include consulting, expert witness and trial services related to preferential payments, solvency and fraudulent conveyances, substantive consolidation, claims litigation, plan feasibility, valuation disputes, and board fiduciary assessments. Our commercial and regulatory dispute services involve industry-specific expertise relating to industry standards and customary practices, economic damages, fact finding, and forensic review and analysis, primarily related to the automotive, hospitality, gaming and leisure, real estate, retail and consumer products and TMT industries.

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Executive Compensation & Corporate Governance. We provide objective advice on the design and implementation of comprehensive executive compensation programs to attract, retain, reward and motivate management and employees for the right kind of performance while closely aligning the interests of employees with those of the company’s shareholders and investors. Our corporate governance services include succession planning, stock ownership requirements, and shareholder engagement and outreach.

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Forensic Accounting & Advisory Services. We assist U.S. and multinational clients with responding to allegations involving accounting, financial reporting, fraud, regulatory scrutiny and corruption inquiries. We assist corporate clients with compliance, governance advisory and remediation services to strengthen their defenses against white collar crime. Our securities industry and accounting advisory professionals assist corporations in addressing financial restatement matters and responding to all phases of actions and litigation from the U.S. Securities and Exchange Commission ("SEC"), the Public Company Accounting Oversight Board, the UK’s Financial Reporting Council and other regulatory bodies.

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Global Risk and Investigations Practice. We bring a multidisciplinary approach to advising clients with their investigations. We apply our expertise in fraud and enforcement-related investigations, focusing on white-collar crime, bribery and corruption, money laundering, sanctions violations, embezzlement, transactional due diligence, litigation intelligence and commercial disputes. We have professionals located around the globe who have a deep understanding of the multi-jurisdictional investigative processes. Our clients rely on our services to assess risk, recover misappropriated assets, report to key stakeholders and institute reforms.

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Cybersecurity. Through a comprehensive set of cybersecurity offerings, combined with cutting-edge technologies and capabilities, we help clients understand the cyber risks they face so that critical needs are addressed. Further, we can integrate new solutions atop or alongside pre-existing policies and programs to better combat cybersecurity threats. We help our clients understand their own environments, identify threats, implement defensive strategies, respond to crises, and recover their operations and reputation after an incident.

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Export Controls & Sanctions. We help U.S. and non-U.S. companies comply with global export controls and sanctions laws, providing services such as due diligence, advanced data analytics for risk models, practical policies and procedures, and tailored training programs. We regularly support legal counsel in navigating the complexity of export controls and sanctions compliance by simplifying them into manageable, actionable and auditable internal controls. Our consultants also provide insight into the possible interpretations of new sanctions based on foreign policy and national security priorities, and how these priorities might affect the expectations of government agencies for compliance.

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Dispute Advisory Services. We provide comprehensive economics, finance, valuation and accountancy services to the global business and legal communities designed to protect and enhance value for all stakeholders. Our practice is built around authoritative, experienced, and independent functional and industry experts, accountants and economists. These experts understand the hands-on application of traditional and emerging economic, financial, valuation and accountancy, data analyses and analytical methodologies. We provide assessment and litigation support at every stage of judicial disputes (including class actions) and for a broad range of federal and state courts, arbitrations and regulatory forums, including international arbitrations. Our experts are both individually recognized for the depth of their knowledge and also for our work as a team to resolve the many interconnected issues our clients face in complex business disputes. Our work is focused on the following areas: securities, accounting and regulatory enforcement (including securities and antitrust) matters, intellectual property ("IP") disputes, valuation, solvency and acquisition disputes, international arbitrations, financial product litigation, labor and employment disputes, business interruption claims, and general commercial and contract disputes.

•	Trial Services. We help organize information into a cohesive and persuasive story and provide the tools and expertise to present that story in briefs and expert reports, in the courtroom or in presentations to regulators. Our

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Data & Analytics. We support some of the world’s largest investigations with advanced analytics solutions, uncovering insights and relationships from financial, operational and transactional data often stored in various systems and jurisdictions. We visualize suspicious relationships as data clusters and patterns and pass the results on for further analysis and verification by our forensic investigations team. The results are fed back to fine-tune machine learning algorithms for identification and prediction of fraudulent transactions and other financial crimes such as money laundering and sanction breaches. Our experts build customized applications as required by case, leverage visualization tools for information sharing, and assist with performing system and information technology audits.

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Compliance, Monitoring & Receivership. We provide full-scale assessments and process improvement and support services for compliance programs or in support of trustees, independent monitors, receivers and examiners. In matters involving the appointment of monitors, receivers or examiners by courts or regulators, our experts possess the necessary independence and skills to test and monitor compliance with, and the continuing effectiveness of, the terms of settlements or reforms across many industries and professions.

•	Anti-Corruption Investigations & Compliance. We help clients mitigate corruption risks and investigate and prevent corruption issues arising from the FCPA, the UKBA, Brazil’s Clean Company Act and other similar global anti-corruption laws.

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Financial Crimes and Anti-Money Laundering. We assist financial and non-financial institutions, broker-dealers, money transmitters, regulators, insurers, law firms, investors and corporations with investigating and addressing anti-money laundering and anti-corruption regulations. We also assist with regulatory compliance and Office of Foreign Assets Control sanctions. Our expertise combines our banking and investigative experience with our specialized technology and data services.

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Global Insurance Services. Our credentialed insurance experts and consultants support insurers, reinsurers, brokers, captives, risk retention groups, banks, regulators, investors, other insurance providers, and corporations and their counsel. We deliver the specialized expertise, experience, financial, technical and leadership skills to help those in the insurance industry and its associated ecosystem to resolve issues, measure and manage risk, improve financial performance, and optimize opportunities.

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Construction Solutions. We provide commercial management, risk-based advisory, dispute resolution and strategic communications services for complex construction projects across all industries, including but not limited to energy, infrastructure and healthcare. Our professionals are industry leaders who understand technical, business and regulatory matters related to large and complex construction projects and are seasoned in giving expert testimony in construction-related disputes.

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Asset Lifecycle Management. We streamline the construction, maintenance, operations and retirement of capital assets, helping to deliver optimal lifecycle return on investment. Our professionals, well-proven processes, and state-of-the-art tools and technology optimize performance, reduce risk and improve collaboration among stakeholders across countless industries. We advise owner/operators, equity partners, and engineering, procurement and construction firms on the diverse challenges faced throughout the process of improving the lifecycle value for critical capital assets. We regularly fulfill project and operations management roles for clients around the world. Our services and tools improve aspects of the asset management lifecycle, shortening time to value and increasing capital efficiency.

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Environmental Solutions. We help organizations deal with environmental issues or programmatic challenges by offering services that focus on the resolution of complex contamination, toxic tort, products liability and insurance disputes. We provide clients with services in the areas of alternative dispute resolution (arbitration and mediation), cleanup cost and damages allocation, financial and cost accounting, forensic historical research, private investigations and environmental claims analysis. Our team possesses specialized project expertise in areas such as petroleum, chemicals, urban waterway (sediment), landfill, mining and smelting, and government operations.

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Health Solutions. We work with a variety of healthcare and life sciences clients to discern innovative solutions that optimize performance in the short term and prepare for future strategic, operational, financial and legal challenges. Our diverse team of experts address challenges across the spectrum of healthcare disciplines. These professionals offer specialized capabilities and have a track record of success across multiple disciplines, including

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Non-M&A-related Antitrust. We provide financial, economic and econometric consulting services to assist clients in public policy debates, regulatory proceedings and litigation. Our professionals are experts at analyzing and explaining the antitrust and competition impact of diverse proceedings relating to price fixing, monopolization and abuse of a dominant position, exclusionary conduct, bundling and tying, and predatory pricing. We also provide expert testimony regarding class certifications and quantification of damages analyses for corporations, governments and public-sector entities in the U.S. and around the world.

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M&A-related Antitrust. We have unsurpassed expertise in analyzing and articulating the competitive effects and consumer benefits of mergers and other transactions in complex and dynamic markets such as healthcare, transportation and TMT. Our experts have analyzed and presented evidence before regulatory authorities on both horizontal and vertical M&A, and we have served as advisors and experts to regulatory agencies on M&A policy matters. Our expertise includes evaluation of competitive effects, efficiencies and benefits of consolidation, comprehensive assessments of market definition and empirical analyses, and assessments of market conditions affecting entry and expansion. We employ the same empirical models used by regulatory authorities for assessing the competitive effects of transactions. In addition, we utilize predictive analytics to test the likelihood of successful divestitures when required and advise on the competition aspects of transactions from conception to completion.

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Valuation. We help clients identify and understand the value of their businesses in both contentious and uncontentious situations. We provide business valuation, expert valuation and expert testimony services relating to traditional commercial disputes and other matters, including transaction pricing and structuring, securities fraud, valuations for financial reporting, tax, regulatory and stakeholder investment compliance, solvency issues, fraudulent transfers, investment decisions, post-acquisition M&A disputes, and transactions and disputes between shareholders. We also provide our clients with specialized valuation opinions and expert testimony involving international disputes before international courts of jurisdiction and arbitration tribunals.

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Securities Litigation & Risk Management. We apply economic theory, econometrics and the modern theory of finance to assess, quantify and manage risks inherent in global financial markets. We advise clients and testify on a variety of issues, including securities fraud, insider trading, initial public offering (“IPO”) allocations, market efficiency, market manipulation and forms of securities litigation. We also evaluate financial products such as derivatives, securitized products, collateralized obligations, special purpose entities and structured financial instruments and transactions.

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Economic Impact Analysis. We apply both market and macroeconomic models across a range of industries to analyze how markets and the broader economy react to changes in regulation, public policy and corporate strategies. Our clients use our analyses to formulate their strategic plans to educate key stakeholders, including policymakers, regulators, the media and the public on the benefits and costs of their plans when determining the best course of action.

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Market Modeling. We develop and deploy proprietary and third-party market modeling tools to explore complex business problems for clients facing technology, regulatory and economic uncertainties. We have served a diverse set of private and public sector clients across the world in industries such as EPP, mining, healthcare and life sciences, transportation, agriculture and commodities. Our market models include system optimization, Monte Carlo, stochastic, revenue requirement, cost of service, net present value and auction modeling. We have applied these models to advise clients on business strategy, resource economics, planning and budgeting, capital market transactions, contract negotiation, arbitration, litigation and public policy matters.

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Applied Statistical Data Sciences. Utilizing the latest statistical and data sciences methods, we provide clients with quantitative solutions and intuitive insights. Our team of testifying experts, economists, data scientists and statisticians combine technical modeling and industry expertise to construct empirical and analytical models that support business and litigation strategies. We help our clients tackle complex issues, such as determining how best to minimize risks, quantifying liability and damage exposure, negotiating contracts, and supporting investment and pricing strategies. Our models have been used extensively in litigation to assess causation and damages, detect potentially illegal behavior, fine-tune litigation strategies and negotiate settlements.

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E-discovery and Data Compliance Management. We plan, design and manage discovery workflows and engagements, applying advanced analytics approaches, to maximize responsiveness, minimize costs and risks, and provide greater cost predictability. We offer several deployment options, from a do-it-yourself on-premises model to full-service including data processing, production, hosting and consulting on discovery case management and data analysis. Our e-discovery services are offered on multiple leading review platforms and include client access to emerging new technologies. For data compliance management, we also offer our clients the option to establish master repositories where historical data can be accessed and used across multiple matters, enabling the reuse and retention of valuable attorney work product and other information.

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Managed Document Review. We offer Acuity®, a managed multilingual, global review offering that allows corporations and law firms to improve the cost-effectiveness of the document review processes while more effectively identifying the most critical information and documents in large data sets. With Acuity®, we drive review efficiency by leveraging the power of analytics and artificial intelligence while ensuring rigorous project and budget oversight. Acuity® workflows enable collaboration among the corporation, law firm and our managed review teams.

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Digital Forensics. We help organizations meet requirements for collecting, analyzing and producing large amounts of data from multiple jurisdictions through a variety of sources, including email, chat, voicemail, backup tapes, social media, the cloud, mobile devices, shared server files and databases. We provide both proactive and reactive support using expert services, methodologies and tools that help organizations and their legal advisors understand technology-dependent issues, including the reconstruction of data that has been deleted, misplaced or damaged.

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Information Governance, Privacy & Security. We help clients design, implement and maintain strategies for information governance, privacy and security to reduce corporate risk, achieve compliance with emerging privacy regulations, decrease storage costs, secure data, improve the e-discovery process and enable better insight into the organization’s data. Our services include: data privacy program design and implementation, data migration (including cloud), remediation and segregation services (including social media, text messaging, audio, video, workstation, backup and forensic image), defensible decommissioning and disposition of business applications, and litigation hold process optimization.

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Contract Intelligence. We provide organizations and law firms a centralized method to review and analyze their global contract universe through a cost-effective solution that incorporates key components of contract life cycle management. Our services help our clients better find, understand and act upon contracts to meet regulatory requirements, reduce risk and recognize greater business value in various business contexts, including pre-merger contract diligence, alignment of contracts with new regulations and analyses of leasing agreements for compliance with new accounting standards, among others.

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Corporate Reputation. We promote businesses and protect corporate reputations by creating solutions for our clients’ mission-critical communications needs. Our services include reputational risk advisory, stakeholder identification, mapping and engagement, messaging and organization positioning, thought leadership consultancy, corporate responsibility, environmental, social and governance advisory, strategic media relations, and media and presentation coaching. In addition to supporting external messaging, we help our clients plan, design and implement internal communications programs to enhance employee engagement. Our services also assist business leaders in communicating and navigating through transformative events, including new strategy and vision introductions, and executive positioning.

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Public Affairs & Government Relations. We advise organizations around the world on how to effectively engage with governments and policymakers. Our integrated team has a presence in leading political centers globally, including Berlin, Brussels, London, Beijing, Melbourne and Washington, D.C. We offer a full range of engagement programs, ranging from crisis management of imminent legislation to longer-term shaping of the policy environment. We also employ a range of qualitative and quantitative tools to establish our clients’ case in connection with government investigations, political and legislative engagement, public policy debates and business strategies, whether in terms of message refinement, policy mapping, reputation benchmarking, opinion polling or speechwriting.

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Capital Markets Communications. We assist clients in developing and delivering a consistent and credible narrative to investors and the investment community. We help companies present their entry into the equity markets, from articulating the strategic rationale and investment thesis to preparing the registration statement with securities regulators and executing the IPO roadshow. We also provide core services that support best-in-class investor relations programs following an IPO, including perception audits, investor targeting, financial calendar communications, executive positioning, market intelligence, investor collateral and investor events, among others.

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Crisis Communications. We advise clients on their communications challenges related to a wide range of crisis events including cybersecurity threats, corporate investigations, workplace misconduct, fraud, litigation, product liability and recalls, as well as operational incidents, among others. In addition to on-the-ground support, we help clients assess the potential severity, duration and stakeholder impact of a situation in order to determine the most effective response strategy. We support our clients throughout the crisis lifecycle by developing customized training sessions that prepare them for crisis events, from assessment and scenario planning to mobilization, and traditional media training where we test a client’s ability to respond and execute in a given situation.

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Transaction Communications. We specialize in advising clients on their communications issues related to M&A, turnaround, restructurings, bankruptcies, activist situations and other transaction- and market-related concerns. We employ a disciplined discovery process to identify preparedness gaps, assess the situation, plan for various possibilities, prepare and disseminate communications, as well as manage legal and political considerations. We provide services relating to a wide range of M&A scenarios, including transformative and bolt-on acquisitions, friendly and hostile takeovers and activism defense. We also advise clients in situations that present threats to their valuation and reputation with investors such as proxy contests, financial restatements, shareholder activism, unplanned management changes and related crises. Finally, we provide turnaround and restructuring communications that are often integrated with the firm’s Corporate Finance & Restructuring services and designed to help management teams stabilize their businesses and address the concerns of internal and external stakeholders.

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Digital, Analytics & Insights. We collaborate with clients to develop data-driven communications campaigns that advance their business objectives among key stakeholders. Our approach includes leveraging customized advanced analytics to understand corporate perception through the views of multiple stakeholders. Our services include designing messages and the corporate brand’s digital and visual identity, developing the digital program and platforms to support these messages, quantifying the return on investment and the impact on reputation and enterprise values, and optimizing the campaign based on data and insights.

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M&A Activity. M&A activity is an important driver for all our segments. We offer services for all phases of the M&A process. Our services during the pre-transaction phase include government competition advice and pre-transaction analysis. Our services during the negotiation phase include due diligence, negotiation and other transaction advisory services, government competition and antitrust regulation services, expert advice, asset valuations and financial communications advice. We also offer post-M&A integration and transformation services.

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Financial Markets. Financial market factors, including credit and financing availability, terms and conditions, the willingness of financial institutions to provide debt modifications or relief, corporate debt levels, default rates and capital markets transactions, are significant drivers of demand for our business offerings, particularly our Corporate Finance & Restructuring and Strategic Communications segments.

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Regulatory Complexity, Public Scrutiny and Investigations. Increasingly complex global regulations and legislation, greater scrutiny of corporate governance, instances of corporate malfeasance, and more stringent and complex reporting requirements drive demand for our business offerings. The need to understand and address the impact of regulation and legislation, as well as the increasing costs of doing business, has prompted companies to focus on better assessing and managing risks and opportunities. In addition, boards of directors, audit committees and independent board committees have been increasingly tasked with conducting internal investigations of financial wrongdoing, regulatory non-compliance and other issues. These factors and laws, such as the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act, have contributed to the demand for independent consultants and experts to investigate and provide analyses and to support the work of outside legal counsel, accountants and other advisors. These types of investigations also increasingly demand the use of multiple disciplinary service offerings like ours, which combine skills and capabilities across practices with industry expertise. These factors drive demand for various practices and services of all our segments.

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Litigation and Disputes. Litigation and business disputes, the complexity of the issues presented, and the amount of potential damages and penalties drive demand for the services offered by many of our segments, particularly our Forensic and Litigation Consulting, Economic Consulting and Technology segments. Law firms and their clients, as well as government regulators and other interested third parties, rely on independent outside resources to evaluate claims, facilitate discovery, assess damages, provide expert reports and testimony, manage the pre-trial and in-trial process, and effectively present evidence.

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Operational Challenges and Opportunities. Businesses facing challenges require the evaluation and re-evaluation of strategy, risks and opportunities as a result of crisis-driven situations, competition, regulation, innovation and other events that arise in the course of business. These challenges include enterprise risk management, global expansion, competition from established companies, emerging businesses and technologies doing business in emerging markets, and new and changing regulatory requirements and legislation. Management, companies and their boards need outside help to recognize, understand and evaluate such events and effect change, which drives demand for independent expertise that can combine general business acumen with the specialized technical expertise of our practice offerings and industry expertise. These factors drive demand for various practices and services of all our segments.

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Developing Markets. The growth of multinational firms and global consolidation can precipitate antitrust and competition scrutiny and the spread internationally of issues and practices that historically have been more common in the U.S., such as increased and complex litigation, corporate restructuring and bankruptcy activities, and antitrust and competition scrutiny. Companies in the developing world and multinational companies can benefit from our expert advice to access capital and business markets, comply with the regulatory and other requirements of multiple countries, structure M&A transactions and conduct due diligence, which drives demand for the services of all of our segments.

•	Pre-eminent Businesses and Professionals. We believe that our segments include some of the pre-eminent practices and professionals in our industry today. During 2019, the awards and recognitions received by the Company include the following:

•	FTI Consulting named to Forbes magazine's list of America’s Best Management Consulting Firms for the fourth consecutive year, recognized in 16 sectors and functional areas.

•	FTI Consulting named to Consulting magazine’s Best Firms to Work For list for the second consecutive year.

•	FTI Consulting recognized as Consulting Firm of the Year by Who’s Who Legal for the third consecutive year.

•	Compass Lexecon ranked #1 on Global Arbitration Review’s GAR 100 Expert Witness Firms’ Power Index for the second consecutive year.

•	FTI Consulting recognized as Arbitration Expert Firm of the Year by Who’s Who Legal for the fifth consecutive year.

•	Compass Lexecon recognized as Competition Economics Firm of the Year by Who’s Who Legal for the fifth consecutive year.

•	FTI Consulting and Compass Lexecon led the Who’s Who Legal Consulting Experts Guide for the fourth consecutive year with 149 experts recognized.

•	FTI Consulting ranked #1 U.S. Restructuring Advisor by The Deal for the 12th consecutive year.

•	FTI Consulting named Public Relations Agency of the Year at the PR World Awards.

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Diversified Service Offerings. Our five reportable segments offer a diversified portfolio of practices providing services within our four geographic regions. Our broad range of practices and services, the diversity of our revenue streams, our specialized industry expertise and our global locations distinguish us from our competitors. This diversity helps to mitigate the impact of crises, events and changes in a particular practice, industry or country.

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Diversified Portfolio of Elite Clients. We provide services to a diverse group of clients, including global Fortune 500 companies, FTSE 100 companies, global financial institutions, banks, and local, state and national governments and agencies in the U.S. and other countries. Additionally, 96 of the 100 law firms as ranked by American Lawyer Global 100: Most Revenue List refer or engage us on behalf of numerous clients on multiple matters.

•	Strong Cash Flow. Our business model has several characteristics that produce consistent cash flows. Our strong cash flow supports business operations, capital expenditures and our ability to service our indebtedness and pursue our growth and other strategies.

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•	Demand for Integrated Solutions and a Consultative Approach. Our breadth and depth of practice and service offerings and industry expertise across the globe drive demand by businesses that seek our integrated services and consultative approach covering different aspects of event-driven occurrences, reputational issues and transactions across different jurisdictions.

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Leverage Our Practitioners, Businesses, Extensive Geographic Diversification and Relationships. We work hard to maintain and strengthen our core practices and competencies. We believe that our recognized expertise, client relationships and the quality of our reputation, coupled with our successful track record, size and geographic diversity, are the most critical elements in a decision to retain us. Many of our professionals are recognized experts in their respective fields.

•	Grow Organically. Our strategy is to grow organically by increasing headcount and market share to provide clients with an attractive and evolving suite of services across our segments, as well as the industries and geographic regions in which we operate.

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Attract and Retain Highly Qualified Professionals. Our professionals are crucial to delivering our services to clients and generating new business. As of December 31, 2019, we employed 4,424 revenue-generating professionals, many of whom have an established and widely recognized name in their respective service and industry specialization. Through our substantial staff of highly qualified professionals, we can handle a large number of complex assignments simultaneously. To attract and retain highly qualified professionals, we offer significant compensation opportunities, including sign-on bonuses, forgivable loans, retention bonuses, cash incentive bonuses and equity compensation, along with a competitive benefits package and the opportunity to work on challenging global engagements with highly skilled peers.

•	Enhance Profitability. We endeavor to manage costs, headcount, utilization, bill rates and pricing for both time and materials, and alternative fee arrangements to operate profitably.

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Enhance Value through Capital Allocation. The strength of our balance sheet gives us the flexibility to allocate capital and create shareholder value in numerous ways, including investments in hiring new employees, acquisitions and share repurchases. We consider strategic and opportunistic acquisition opportunities on a selective basis. We seek to integrate completed acquisitions and manage investments in a way that fosters organic growth, expands our geographic presence or complements our segments, practices, services and industry focuses. We typically structure our acquisitions to retain the services of key individuals from the acquired companies.

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•	fluctuations in U.S. and/or global economies, including economic downturns or recessions and the strength and rate of any general economic recoveries;

•	the U.S. or global financial markets and the availability, costs, and terms of credit and credit modifications;

•	level of leverage incurred by countries or businesses;

•	M&A activity;

•	frequency and complexity of significant commercial litigation;

•	overexpansion by businesses causing financial difficulties;

•	business and management crises, including the occurrence of alleged fraudulent or illegal activities and practices;

•	new and complex laws and regulations, repeals of existing laws and regulations or changes of enforcement of laws, rules and regulations, including antitrust/competition reviews of proposed M&A transactions;

•	other economic, geographic or political factors; and

•	general business conditions.

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•	cultural and language differences;

•	limited “brand” recognition;

•	different employment laws and rules, employment or service contracts, compensation methods, and social and cultural factors that could result in employee turnover, lower utilization rates, higher costs and cyclical fluctuations in utilization that could adversely affect financial and operating results;

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•	foreign currency disruptions and currency fluctuations between the U.S. dollar and foreign currencies that could adversely affect financial and operating results;

•	different legal and regulatory requirements and other barriers to conducting business;

•	greater difficulties in resolving the collection of receivables when legal proceedings are necessary;

•	greater difficulties in managing our non-U.S. operations, including client relationships, in certain locations;

•	disparate systems, policies, procedures and processes;

•	failure to comply with the FCPA and anti-bribery laws of other jurisdictions;

•	higher operating costs;

•	longer sales and/or collections cycles;

•	potential restrictions or adverse tax consequences for the repatriation of foreign earnings, such as trapped foreign losses and importation or withholding taxes;

•	different or less stable political and/or economic environments;

•	potential increased regulatory and legal complexities surrounding uncertainties related to the UK’s exit from the European Union, commonly referred to as Brexit;

•	conflicts between and among the U.S. and countries in which we conduct business, including those arising from trade disputes or disruptions, the termination or suspension of treaties, or boycotts;

•	civil disturbances or other catastrophic events that reduce business activity; and

•	political interference with our ability to conduct business in the applicable jurisdiction.

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•	difficulties in integrating diverse corporate cultures and management styles;

•	disparate policies and practices;

•	client relationship issues;

•	decreased utilization during the integration process;

•	loss of key existing or acquired personnel;

•	increased costs to improve or coordinate managerial, operational, financial and administrative systems;

•	dilutive issuances of equity securities, including convertible debt securities, to finance acquisitions;

•	the assumption of legal liabilities;

•	future earn-out payments or other price adjustments;

•	potential future write-offs relating to the impairment of goodwill or other acquired intangible assets or the revaluation of assets;

•	difficulty or inability to collect receivables; and

•	undisclosed liabilities.

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•	create, incur or assume certain liens;

•	make certain restricted payments, investments and loans;

•	create, incur or assume additional indebtedness or guarantees;

•	create restrictions on the payment of dividends or other distributions to us from our restricted subsidiaries;

•	engage in M&A transactions, consolidations, sale-leasebacks, joint ventures, and asset and security sales and dispositions;

•	pay dividends or redeem or repurchase our capital stock;

•	alter the business that we and our subsidiaries conduct;

•	engage in certain transactions with affiliates;

•	modify the terms of certain indebtedness;

•	prepay, redeem or purchase certain indebtedness; and

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•	make material changes to accounting and reporting practices.

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(1)

Includes up to (i) 35,708 shares of common stock issuable upon vesting and exercise of outstanding stock options granted under our 2006 Global Long-Term Incentive Plan (as Amended and Restated Effective as of May 14, 2008) and (ii) 589,223 shares of common stock issuable upon vesting and exercise of outstanding stock options granted under our 2009 Omnibus Incentive Compensation Plan (as Amended and Restated Effective as of June 3, 2015).

(2)	Includes up to 53,552 shares of common stock issuable upon exercise of fully vested stock options granted as employment inducement on July 30, 2014 to an executive officer hire pursuant to Rule 303.08 of the NYSE.

(3)	Includes 1,396,183 shares of common stock available for issuance under our 2017 Omnibus Incentive Compensation Plan, all of which are available for stock-based awards.

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(1)

On June 2, 2016, our Board of Directors authorized a stock repurchase program of up to $100.0 million (the “Repurchase Program”). On each of May 18, 2017, December 1, 2017 and February 21, 2019, our Board of Directors authorized an additional $100.0 million, respectively, increasing the Repurchase Program to an aggregate authorization of $400.0 million. No time limit has been established for the completion of the Repurchase Program and the Repurchase Program may be suspended, discontinued, or replaced by the Board of Directors at any time without prior notice. During the year ended December 31, 2019, we repurchased an aggregate of 1,258,420 shares of our outstanding common stock under the Repurchase Program at an average repurchase price of $84.16 per share for a total cost of approximately $105.9 million.

(2)	Includes 4,328 shares of common stock withheld to cover payroll tax withholdings related to the lapse of restrictions on restricted stock.

(3)	Includes 4,518 shares of common stock withheld to cover payroll tax withholdings related to the lapse of restrictions on restricted stock.

(4)	Includes 1,311 shares of common stock withheld to cover payroll tax withholdings related to the lapse of restrictions on restricted stock.

(5)	During the month ended October 31, 2019, we repurchased and retired 40,000 shares of common stock, at an average per share price of $107.99, for an aggregate cost of $4.3 million.

(6)	During the month ended November 30, 2019, we repurchased and retired 197,868 shares of common stock, at an average per share price of $107.58, for an aggregate cost of $21.3 million.

(7)	During the month ended December 31, 2019, we repurchased and retired 21,955 shares of common stock, at an average per share price of $108.40, for an aggregate cost of $2.4 million.

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(1)	Working capital is defined as current assets less current liabilities.

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•	the number, size and type of engagements we secure;

•	the rate per hour or fixed charges we charge our clients for services;

•	the utilization rates of the revenue-generating professionals we employ;

•	the timing of revenue recognition related to revenues subject to certain performance-based contingencies;

•	the number of revenue-generating professionals;

•	licensing of our software products and other technology services;

•	the types of assignments we are working on at different times;

•	the length of the billing and collection cycles; and

•	the geographic locations of our clients or locations in which services are rendered.

•	Total Segment Operating Income

•	Adjusted EBITDA

•	Total Adjusted Segment EBITDA

•	Adjusted EBITDA Margin

•	Adjusted Net Income

•	Adjusted Earnings per Diluted Share

•	Free Cash Flow

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(1)	In 2019, represents a discrete tax adjustment resulting from a change in estimate related to the accounting for the Ringtail divestiture.

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(1)	The number of revenue-generating professionals for the Technology segment excludes as-needed professionals, who we employ based on demand for the segment’s services. We employed an average of 285 and 253 as-needed employees during the years ended December 31, 2019 and 2018 respectively.

(2)

We calculate the utilization rate for our billable professionals by dividing the number of hours that all of our billable professionals worked on client assignments during a period by the total available working hours for all of our billable professionals during the same period. Available hours are determined by the standard hours worked by each employee, adjusted for part-time hours, U.S. standard work weeks and local country holidays. Available working hours include vacation and professional training days but exclude holidays. Utilization rates are presented for our segments that primarily bill clients on an hourly basis. We have not presented utilization rates for our Technology and Strategic Communications segments as most of the revenues of these segments are not generated on an hourly basis.

(3)

For engagements where revenues are based on number of hours worked by our billable professionals, average billable rate per hour is calculated by dividing revenues (excluding revenues from success fees, pass through revenues and outside consultants) for a period by the number of hours worked on client assignments during the same period. We have not presented average billable rates per hour for our Technology and Strategic Communications segments as most of the revenues of these segments are not based on billable hours.

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(1)	Revenues less direct cost of revenues.

(2)	Gross profit as a percent of revenues.

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(1)	Revenues less direct cost of revenues.

(2)	Gross profit as a percent of revenues.

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(1)	Revenues less direct cost of revenues.

(2)	Gross profit as a percent of revenues.

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(1)	Revenues less direct cost of revenues.

(2)	Gross profit as a percent of revenues.

(3)	Includes personnel involved in direct client assistance and revenue-generating consultants and excludes professionals employed on an as-needed basis.

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(1)	Revenues less direct cost of revenues.

(2)	Gross profit as a percent of revenues.

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•	operating and general corporate expenses relating to the operation of our businesses;

•	capital expenditures, primarily for information technology equipment, office furniture and leasehold improvements;

•	debt service requirements, including interest payments on our long-term debt;

•	compensation for designated executive management and senior managing directors under our various long-term incentive compensation programs;

•	discretionary funding of our Repurchase Program;

•	contingent obligations related to our acquisitions;

•	potential acquisitions of businesses; and

•	other known future contractual obligations.

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•	our future profitability;

•	the quality of our accounts receivable;

•	our relative levels of debt and equity;

•	the volatility and overall condition of the capital markets; and

•	the market price of our securities.

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(1)	Includes principal and interest payments. Projected interest payments may differ in the future based on the balance outstanding on our Credit Facility, as well as changes in market interest rates.

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Time and expense arrangements require the client to pay us based on the number of hours worked at contractually agreed-upon rates. We recognize revenues for these arrangements based on hours incurred and contracted rates utilizing a right-to-invoice practical expedient because we have a right to consideration for services completed to date. When a time and expense arrangement has a not-to-exceed or "cap" amount and we expect to perform work in excess of the cap, we recognize revenues up to the cap amount specified by the client, based on the efforts or hours incurred as a percentage of total efforts or hours expected to be incurred (i.e., proportional performance method). Certain time and materials arrangements may be subject to third-party approval, e.g., a court or other regulatory institution, with interim billing and payments made and received based upon preliminarily agreed-upon rates. In such cases, we record revenues for the portion of our services based on our assessment of the expected probability of amounts ultimately to be agreed upon by the court or regulator. These assessments are made on a case-by-case basis depending on the nature of the engagement, client economics, historical experience and other appropriate factors.

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•	Fixed-fee arrangements require the client to pay a pre-established fee in exchange for a predetermined set of professional services. We recognize revenues for these arrangements based on the proportional performance related to individual performance obligations within each arrangement, however, these arrangements generally have one performance obligation.

•	Performance-based or contingent arrangements represent forms of variable consideration. In these arrangements, our fees are based on the attainment of contractually defined objectives with our client, such as completing a business transaction or assisting the client in achieving a specific business objective. We recognize revenues earned to date by applying the proportional performance method.

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•	significant underperformance relative to expected historical or projected future operating results;

•	a significant change in the manner of our use of the acquired asset or the strategy for our overall business;

•	a significant market decline related to negative industry or economic trends; and/or

•	our market capitalization relative to net carrying value.

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•

Time and expense arrangements require the client to pay us based on the number of hours worked at contractually agreed-upon rates. We recognize revenues for these arrangements based on hours incurred and contracted rates utilizing a right-to-invoice practical expedient because we have a right to consideration for services completed to date. When a time and expense arrangement has a not-to-exceed or "cap" amount and we expect to perform work in excess of the cap, we recognize revenues up to the cap amount specified by the client, based on the efforts or hours incurred as a percentage of total efforts or hours expected to be incurred (i.e., proportional performance method). Certain time and materials arrangements may be subject to third-party approval, e.g., a court or other regulatory institution, with interim billing and payments made and received based upon preliminarily agreed-upon rates. In such cases, we record revenues for the portion of our services based on our assessment of the expected probability of amounts ultimately to be agreed upon by the court or regulator. These assessments are made on a case-by-case basis depending on the nature of the engagement, client economics, historical experience and other appropriate factors.

•	Fixed-fee arrangements require the client to pay a pre-established fee in exchange for a predetermined set of professional services. We recognize revenues for these arrangements based on the proportional performance related to individual performance obligations within each arrangement; however, these arrangements generally have one performance obligation.

•	Performance-based or contingent arrangements represent forms of variable consideration. In these arrangements, our fees are based on the attainment of contractually defined objectives with our client, such as completing a business transaction or assisting the client in achieving a specific business objective. We recognize revenues earned to date by applying the proportional performance method.

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•	significant underperformance relative to expected historical or projected future operating results;

•	a significant change in the manner of our use of the acquired asset or the strategy for our overall business;

•	a significant market decline related to negative industry or economic trends; and/or

•	our market capitalization relative to net carrying value.

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•	Time and expense arrangements require the client to pay us based on the number of hours worked at contractually agreed-upon rates. We recognize revenues for these arrangements based on hours incurred and contracted rates utilizing a right-to-invoice practical expedient because we have a right to consideration for services completed to date.

•	Fixed-fee arrangements require the client to pay a pre-established fee in exchange for a predetermined set of professional services. We recognize revenues for these arrangements based on the proportional performance related to individual performance obligations within each arrangement; however, these arrangements generally have one performance obligation.

•	Performance-based or contingent arrangements represent forms of variable consideration. In these arrangements, our fees are based on the attainment of contractually defined objectives with our client, such as completing a business transaction or assisting the client in achieving a specific business objective. We recognize revenues earned to date by applying the proportional performance method.

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•	$23.5 million of employee severance and other employee-related costs;

•	$14.4 million of exit costs associated with the curtailment of our lease on our executive office in Washington, D.C.; and

•	$3.0 million of other expenses, including costs related to disposing or closing several small international offices.

(1)	Includes options and cash-settled stock appreciation rights.

(2)	Includes restricted share awards, restricted stock units, performance stock units and cash-settled restricted stock units.

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(1)	Performance stock units granted are presented at the maximum potential payout percentage of 150% of target shares granted.

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(1)	During the year ended December 31, 2018, we sold a business within our Technology segment for proceeds of $50.3 million. We wrote off $20.9 million in goodwill as a result of the sale.

(2)	During the year ended December 31, 2019, we acquired a restructuring business that was assigned to the Corporate Finance segment. We recorded $27.4 million in goodwill based on a preliminary purchase price allocation as a result of the acquisition. We have included the results of the acquired business’s operations in the Corporate Finance segment since its acquisition date.

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(1)	During the year ended December 31, 2019, we acquired a restructuring business and its related intangible assets that were assigned to the Corporate Finance segment.

(1)	Actual amortization expense to be reported in future periods could differ from these estimates as a result of new intangible asset acquisitions, changes in useful lives, or other relevant factors or changes.

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(1)	The short-term portion is included in “Accounts payable, accrued expenses and other,” and the long-term portion is included in “Other liabilities” on the Consolidated Balance Sheets.

(2)	During the year ended December 31, 2019, we acquired a restructuring business that was assigned to the Corporate Finance segment.

(3)	The carrying values include unamortized deferred debt issue costs and debt discount.

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(1)	We acquired restructuring businesses that were assigned to the Corporate Finance segment during the years ended December 31, 2017 and 2019.

(2)	Accretion for the time value of money is included in "Selling, general and administrative expenses" on the Consolidated Statements of Comprehensive Income.

(3)	Remeasurement gain or loss resulting from a change in the fair value of an acquisition's contingent consideration liability is recorded in “Selling, general and administrative expenses” on the Consolidated Statements of Comprehensive Income.

(4)	Foreign currency translation adjustments are included in "Other comprehensive income (loss), net of tax" on the Consolidated Statements of Comprehensive Income.

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(1)	There were no current portions of long-term debt as of December 31, 2019 and 2018.

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(1)	The sum of the quarterly earnings per share amounts may not equal the annual amounts due to changes in the weighted average number of common shares outstanding during each quarterly period.

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