WEST PALM BEACH, FL: FTI Consulting's strategic communications unit reported a 2.2% year-over-year revenue increase to $50.3 million in the fourth quarter of 2012.
In Q4, the company's overall revenue grew 2.2% year-over-year to $399.3 million. However, it also saw a net loss of $85.9 million in Q4 and an operating loss of $55.3 million in the period. In the prior year's Q4, the company reported net income of $39.9 million and operating income of $68.2 million.
The company attributed the drop in net income and operating income to the impact of a goodwill impairment charge of $110.4 million, due to the writing down of the value of its strategic communications unit.
Roger Carlile, FTI's CFO, said on the earnings call that the non-cash charge of $110.4 million was taken after an annual audit to “reduce the book value of goodwill associated with our strategic communications practice.”
Corporate finance and restructuring revenue increased 13.7% to $123.2 million compared with the fourth quarter of 2011. Its technology sector saw an 11.3% year-over-year drop in revenue to $47.6 million.
For the full year, the company reported revenue of $1.58 billion, up less than 1% compared with the prior year. Net income plunged in 2012, with the company taking a net loss of $37 million for the full year, compared with $104 million in income in 2011. It reported $59 million in operating income in 2012, down from $205.4 million in 2011.
“Amid a challenging macroeconomic backdrop, we have done a lot of hard work and successfully innovated our business,” said Matthew Clark, FTI's senior director and general manager for strategic communications in Washington DC. “The result is that we have a stronger offering today, with more relevant and integrated capabilities to address the needs of our clients, more aligned with the skill sets of our colleagues in other FTI practices, and better prepared for the future, no matter what phase of the economic cycle we're operating in.”