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BigSully1 · February 29, 2008, 11:11:08 AM

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FTI Consulting, Inc.
500 East Pratt Street
Suite 1400
Baltimore, MD 21202
United States - Map
Phone: 410-951-4800
Fax: 410-951-4895
Web Site: http://www.fticonsulting.com

DETAILS
Index Membership: N/A
Sector: Services
Industry: Management Services
Full Time Employees: 2,373

BUSINESS SUMMARY
FTI Consulting, Inc. provides consulting services to organizations confronting the legal, financial, and reputational issues. It provides advice and solutions to corporations, financial institutions, and law firms in the areas of forensic analysis, investigation, economic analysis, restructuring, due diligence, strategic communication, financial communication, and technology. The company's forensic and litigation consulting practice provides services to assist clients in various phases of investigation and litigation, including pre-filing, discovery, jury selection, trial preparation, expert testimony, and other trial support services. FTI Consulting's corporate finance and restructuring consulting practice provides performance improvement, lending solutions, financial and operational restructuring, restructuring advisory, mergers and acquisitions, transaction advisory, and interim management services. Its economic consulting practice delivers economic analysis and modeling of issues arising in mergers and acquisitions, as well as other antitrust and anticompetition, commercial, and securities litigation. The company's technology practice provides products, services, and consulting to law firms, corporations, and government agencies; and focuses on the collection, preservation, review, and production of electronically stored information. FTI Consulting's strategic and financial communications consulting practice provides advice and consulting services related to financial communications, brand communications, public affairs and issues management, and business consulting. It serves telecommunications, healthcare, transportation, utilities, chemicals, energy, commercial and investment banking, pharmaceuticals, tobacco, retail, and information technology industries worldwide. The company was founded in 1982 and is based in Baltimore, Maryland.

BigSully1 · February 29, 2008, 11:15:20 AM

Press Release Source: FTI Consulting

FTI Consulting, Inc. Reports Record 2007 Results
Thursday February 28, 4:08 pm ET
- 2007 Revenues Top $1 Billion
- 2007 Record EPS of $2.00
- Fourth Quarter Revenue Up 29 Percent to Record $280.5 Million
- Fourth Quarter EPS Up 43 Percent to $0.60 Per Share
- 2008 Guidance for Revenue of $1.28-$1.32 Billion and EPS of $2.40 - $2.50

BALTIMORE, Feb. 28 /PRNewswire-FirstCall/ -- FTI Consulting (NYSE: FCN - News), the global business advisory firm dedicated to helping organizations protect and enhance their enterprise value, today reported its financial results for the fourth quarter and full year ended December 31, 2007.
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"With $1 billion in revenue and record earnings per share up over 92% for the year, 2007 was an historic year for FTI," said Jack Dunn, President and CEO of FTI. "I want to thank and salute all the people who made this possible by serving the world's leading enterprises on their most important matters. We look forward with them to even more exciting accomplishments as we enter 2008 with a platform of unparalleled intellectual capital, strong momentum and the right portfolio of services for a turbulent world and stressed global economy."

Fourth Quarter Results

For the fourth quarter of 2007, revenue increased 29.4 percent to a record $280.5 million compared to revenue of $216.8 million in the prior year period. Earnings per diluted share increased 42.9 percent to $0.60, compared to earnings per diluted share of $0.42 in the prior year period, despite a 24.1 percent increase in the weighted average shares outstanding to 51.3 million shares from 41.4 million shares in the prior year period. Earnings from operations before interest, taxes, depreciation and amortization and litigation settlement losses (EBITDA) increased 26.4 percent to $64.3 million, also a record, compared to EBITDA of $50.9 million in the prior year period.

Commenting on the quarter and full year, Mr. Dunn continued, "The fourth quarter of 2007 was a great finale to a record year for FTI:

-- We experienced organic revenue growth of 24 percent and 19 percent for
the fourth quarter and full year, respectively, driven by robust global
demand for our diversified portfolio of services.

-- We maintained strong margins consistent with our guidance for the year.

-- Our operations are now truly global with revenue outside the U.S.
representing 19 percent of our total revenue for the fourth quarter.
This growth is driven both by strong local market needs and
accelerating demand from multi-national organizations engaging FTI to
help manage their risks around the world.

-- We completed the key goals for our 2009 five year plan
-- Annual revenue of $1 billion;
-- Global expansion;
-- Continued practice diversification;
-- All while maintaining industry leading profitability;
And these goals were accomplished fully two years ahead of plan.

-- In October we raised $232 million from a public equity offering that
provides the capital necessary to continue aggressively growing and
serving the robust demand the Company is experiencing around the world.

-- We continued to invest in our brand, as evidenced by our outstanding
organic growth for the quarter and the year, and in our infrastructure
to support our future growth."

Mr. Dunn added, "As we enter 2008, we are continuing to maintain our industry-leading pace and expect another very good year. In the first two months we have been actively engaged in attracting and recruiting the best talent, adding 22 senior managing directors through hiring, acquisition and promotion, and have acquired four businesses in three different countries that deepen our presence and expand our capabilities."

Mr. Dunn concluded, "On a final note, from a business driver perspective, the global credit crisis cannot be ignored. What began as a virus in the U.S. sub-prime mortgage sector has erupted into a financial and economic plague - destabilizing world-wide economies, roiling credit markets and whipsawing stock markets. This plague is attacking transparency, liquidity and, most importantly, confidence in the world's financial markets and the institutions and enterprises that rely on them. Transparency, liquidity and confidence - the very issues our skills are designed to enhance - are vital to enterprise value, which our mission statement calls out for us to protect. We are seeing broadly-based demand in every one of our segments from credit related engagements - and that demand appears to be accelerating."

At December 31, 2007, cash and cash equivalents were $360.5 million with total debt outstanding of $573 million and no borrowings were outstanding under the Company's senior bank revolving credit facility.

Fully diluted weighted average common shares outstanding increased 24.1 percent to 51.3 million in the fourth quarter compared to 41.4 million in the prior year period due to the Company's offering of 4,830,000 shares during the fourth quarter of 2007 and the effects of a higher average share price on the calculation of fully diluted shares outstanding associated with the Company's convertible notes and stock options.

On February 25, 2008, the Board of Directors authorized a stock purchase program for up to $50 million of the Company's common stock. This stock purchase program will expire on February 25, 2009. The Company did not purchase any shares of common stock under its stock purchase program during the fourth quarter. For the full year 2007, FTI repurchased 500,000 shares for a total cost of $18.1 million.

Total headcount as of December 31, 2007, was 2,549, of which 1,954 represented revenue-generating professionals, compared to 2,079 and 1,596, respectively, in the prior year period. Total headcount is approximately 2,800 as of February 28, 2008, over 2,200 of whom were client facing. Turnover for 2007 was 15.8%.

Fourth Quarter Business Segment Results

Segment earnings from operations before interest, taxes, depreciation, amortization and litigation settlement losses are defined as segment EBITDA.

Corporate Finance/Restructuring

Revenue in the Corporate Finance/Restructuring segment accelerated its strong growth, increasing 27.2 percent to $73.6 million compared to $57.9 million in the prior year period. Segment EBITDA increased 48.1 percent to $22.4 million from segment EBITDA of $15.1 million in the prior year period. Segment EBITDA margins expanded to 30.4 percent of revenue from 26.1 percent in the prior year period. The segment continued to perform well ahead of plan, led by improving market demand for restructuring resulting from recent economic and financial turmoil. Industries of importance included automotive, real estate, financial services and retailing. Transaction advisory services practice results were also strong, driven by post acquisition integration engagements and work with large private equity funds who are seeking to enhance returns in their portfolio companies. Services to the health care industry, particularly profit and operations improvement engagements for major hospitals, also continued to expand in the quarter. In addition, the recently-created U.K. practice continued to gain traction, with several significant engagements and the addition of 12 professionals in the second half of 2007.

Strategic Communications

In the Strategic Communications segment, revenue increased 47.4 percent to $60.0 million from $40.7 million in the prior year period. Segment EBITDA increased to $16.2 million, or 26.9 percent of revenue, from $14.2 million, or 34.8 percent of revenue, in the prior year period. The lower margin percent reflects the introduction of a bonus plan in 2007. The segment ended its first full year as part of FTI with strong performances in the U.K., France, Germany and the U.S., growth in retained clients, particularly in the U.K., and solid contributions from businesses acquired during the year. The developing regions of Russia, Asia and the Middle East continued to build momentum with growing profitability. Strategic acquisitions of financial communications firms in Dublin and Chicago in the fourth quarter complement those made earlier in the year in London, Latin America, Australia and China to extend the segment's global footprint and provide further geographical and service diversification. This segment also benefited from several significant engagements referred by other FTI segments as clients became aware of the opportunity to protect and enhance their reputations through strategic communications.

Forensic and Litigation Consulting

Revenue in the Forensic and Litigation Consulting segment increased 6.9 percent to $54.8 million compared to $51.2 million in the prior year period. Segment EBITDA was $15.4 million, compared to EBITDA of $15.6 million in the prior year period. As a percentage of revenue, the segment's fourth quarter EBITDA margin was 28.1 percent, reflecting continuing improvement during the year, but was less than the 30.5 percent in the prior year period. Fourth quarter results in 2006 were exceptionally strong due to a large number of stock option backdating cases that needed to be resolved by year end for financial reporting purposes. This segment's global business intelligence and investigations practice, formed last year, continued its solid growth driven by accelerated Foreign Corrupt Practices Act (FCPA) activity and a growing number of cross border assignments from domestic clients expanding into Asia and Latin America. This segment has significant opportunities in early 2008 as litigation surrounding the global credit crisis and turmoil in the financial markets has started to provide multiple engagements, as yet only in their early stages. Issues involved include valuation of complex financial instruments, financial statement reporting and investigations into business practices.

Technology

Revenue growth in the Technology segment continued to accelerate, increasing 52.4 percent to $47.5 million compared to $31.2 million in the prior year period. Segment EBITDA increased 54.0 percent to $19.6 million from $12.7 million in the prior year period. Segment EBITDA margin expanded to 41.1 percent of revenue from 40.1 percent in the prior year period. Growth of the segment continued to be driven by global product liability matters, board initiated investigations, including FCPA matters, large class actions, and antitrust "second requests". The Company also believes that the market is increasingly placing a premium on vertical industry knowledge and expertise, where the segment is particularly benefiting from its deep experience in the global pharmaceutical, financial services and banking, hedge fund and private equity industries. In addition, this segment is experiencing increasing demand for its on-demand software and related professional services from Europe and Asia due to greater market awareness of FTI's global presence, the full scale opening in the second quarter of a network operating center in Europe equipped to handle complex and large scale on-demand electronic discovery needs and its reputation for managing large and complex multinational cases.

Margins benefited from a continuing shift in the revenue mix from consulting fee focused services to the more profitable and recurring subscription based and on-demand software licensing and processing fees. The Company's Ringtail® suite of products is benefiting from new capability enhancements and heightened demand for tailored solutions that can scale for high volume/high profile matters and support a global base of opportunities based on Ringtail's® strong multi-lingual capabilities. To leverage its indirect and channel focused sales efforts, in the fourth quarter the segment formalized its channel sales program and began to sell its Ringtail® technology through value-added resellers in domestic and international markets. As a result of these new partnerships, and by offering resellers both engineering and sales support to a broader prospect base, the segment is seeing accelerating demand from its partners.

Economic Consulting

Revenue in the Economic Consulting segment increased 24.4 percent to $44.6 million compared to $35.8 million in the prior year period. Segment EBITDA increased 7.1 percent to $11.8 million from segment EBITDA of $11.0 million in the prior year period. Segment EBITDA margin were 26.4 percent of revenue compared to 30.7 percent in the prior year period. Segment EBITDA, while still very strong, was affected by (a) the need to use outside consultants to augment capacity driven by the large increase in demand for the segment's services and (b) non-cash compensation expense resulting from variable accounting treatment for certain options driven by the strong performance of FTI's common stock. The segment has benefited from the turmoil in the credit markets, which is driving an increased frequency of disputes and associated financial consulting engagements. Since December 2007, the segment has received 19 new engagements in the financial arena, including sub-prime. Demand for the segment's M&A services also continued to be strong with 14 new cases since December. Decreased liquidity in the credit markets is causing a shift in M&A activity from private equity toward strategic buyers, who are more likely to contend with anti-trust and competitive issues. The increased corporate M&A activity extends across a number of business sectors, notably financial services, hospitals, airlines and industrial corporations. In addition, this segment is seeing an increasing volume of rail commercial and regulatory work as a result of revised regulatory standards and continued strong demand resulting from antitrust enforcement. This segment has received eight new engagements since December involving anti-trust, price fixing and rate setting, as global competition becomes even more intense.

Full Year 2007 Results

For the full year 2007 period, company-wide revenue increased 41.4 percent to $1.0 billion from $707.9 million in the prior year. Earnings per diluted share for 2007 were $2.00, compared to earnings per diluted share of $1.04 in the prior year or adjusted earnings per diluted share of $1.36(1) in the prior year - an increase of 47.1 percent. EBITDA, as previously defined, for 2007 was $216.0 million, an increase of 40.9 percent over adjusted EBITDA(2) of $153.3 million. in the prior year.

(1) Adjusted earnings per diluted shares are defined as earnings per
diluted share adjusted for special charges of $23.0 million ($13.0
million net of tax) in 2006.
(2) Adjusted EBITDA is defined as earnings from operations before
interest, taxes, depreciation, amortization, litigation settlement
losses and special charges of $23.0 million in 2006.

Corporate Finance/Restructuring

Corporate Finance/Restructuring revenue increased 23.0 percent to $261.6 million from $212.6 million in the prior year period. Segment EBITDA was $71.6 million, or 27.4 percent of revenue, an increase of 39.0 percent over adjusted segment EBITDA of $51.5 million, or 24.2 percent of revenue, in the prior year period. (Adjusted segment EBITDA is defined as segment EBITDA excluding special charges of $7.7 million for 2006.)

Strategic Communications

Strategic Communications revenue was $185.3 million for the year. Segment EBITDA was $48.8 million, or 26.3 percent of revenue. The prior year results include one quarter's contribution as this segment was acquired in October of 2006.

Forensic and Litigation Consulting

Forensic and Litigation Consulting revenue increased 12.3 percent to $217.0 million compared to $193.3 million in the prior year period. Segment EBITDA was $57.3 million, or 26.4 percent of revenue, an increase of 3.6 percent over adjusted segment EBITDA of $55.3 million, or 28.6 percent of revenue, in the prior year period. (Adjusted segment EBITDA is defined as Segment EBITDA excluding special charges of $9.9 million for 2006.)

Technology

Technology revenue increased 38.9 percent to $162.8 million from $117.2 million in the prior year period. Segment EBITDA was $62.9 million, or 38.6 percent of revenue, an increase of 34.0 percent over segment EBITDA of $47.0 million, or 40.1 percent of revenue, in the prior year period.

Economic Consulting

Economic Consulting revenue increased 21.1 percent to $174.5 million from $144.1 million in the prior year period. Segment EBITDA increased 30.4 percent to $48.1 million, or 27.6 percent of revenue, from adjusted segment EBITDA of $36.9 million, or 25.6 percent of revenue, in the prior year period. (Adjusted segment EBITDA is defined as Segment EBITDA excluding special charges of $4.1 million for 2006.)

Introduction of 2008 Guidance

Based on current market conditions, the Company is introducing the following 2008 guidance:

(Dollars and shares in millions except per share amounts)

2007 2008 Guidance
Low High
Amount Increase Amount Increase

Revenues $1,001 $1,275 27% $1,315 31%
EBITDA 216 300 39% 310 44%
Net Income 92 129 40% 135 47%
Fully Diluted EPS $2.00 $ 2.40 20% $ 2.50 25%
-----------------
EBITDA Margin 21.6% 23.5% 23.6%

The low end of the Company's guidance assumes organic revenue growth of 17.5% and the anticipated contribution from first quarter of 2008 acquisitions. The high end assumes organic revenue growth of 19.5% driven by greater activity generated by the global credit crisis and resulting operational leverage, as well as certain synergies from the acquisitions. The Company's current assumption on fully diluted common shares outstanding for both the high and low end of guidance is approximately 54 million shares compared to 46 million in 2007.

Fourth Quarter Conference Call

FTI will hold a conference call for analysts and investors to discuss fourth quarter and full year 2007 financial results at 5:30 p.m. Eastern time on Thursday, February 28, 2008. The call can be accessed live and will be available for replay over the Internet for 90 days by logging onto the Company's website, www.fticonsulting.com.

About FTI Consulting

FTI Consulting is a global business advisory firm dedicated to helping organizations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment. With more than 2,800 professionals located in most major business centers in the world, we work closely with clients every day to anticipate, illuminate, and overcome complex business challenges in areas such as investigations, litigation, mergers and acquisitions, regulatory issues, reputation management and restructuring. More information can be found at www.fticonsulting.com.

Note: Although EBITDA and Segment EBITDA are not measures of financial condition or performance determined in accordance with GAAP, FTI believes that they are useful operating performance measures for evaluating its results of operations from period to period and as compared to its competitors. EBITDA is a common alternative measure of operating performance used by investors, financial analysts and rating agencies to value and compare the financial performance of companies in FTI's industry. FTI uses EBITDA to evaluate and compare the operating performance of its segments and it is one of the primary measures used to determine employee bonuses. FTI also uses EBITDA to value businesses it acquires or anticipates acquiring. FTI provides Adjusted EBITDA and Adjusted earnings per diluted share information for 2006 to illustrate the effect of special charges that were incurred that year and reduced 2006 EBITDA and earnings per diluted share. Adjusted segment EBITDA is provided for 2006 for the three business segments that incurred those special charges. No special charges were incurred in 2007, so no Adjusted EBITDA or adjusted segment EBITDA information is provided for 2007. The adjusted EBITDA information is provided to assist investors in assessing period-to-period comparability. Adjusted EBITDA and Adjusted diluted earnings per share are not financial measures determined in accordance with GAAP. A reconciliation of EBITDA, Segment EBITDA and adjusted EBITDA to Net Income, and a reconciliation of adjusted diluted earnings per share to diluted earnings per share are included in the accompanying tables to this press release. EBITDA and adjusted EBITDA are not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same. In addition, EBITDA is one of the financial measures included in the maintenance covenants contained in FTI's bank credit facility and, thus, as a supplemental financial measure is also indicative of the Company's capacity to service debt and thereby provides additional useful information to investors regarding the company's financial condition and results of operations. EBITDA for purposes of those covenants is not calculated in the same manner as it is calculated in the accompanying table. With respect to FTI's guidance for 2008, a reconciliation of EBITDA to net income as projected for the year ending December 31, 2008 is not provided because FTI cannot reasonably determine the components of net income to provide a reconciliation to EBITDA for its 2008 fiscal year with certainty at this time.

Safe Harbor Statement

This press release includes "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 that involve uncertainties and risks including statements related our future financial results. There can be no assurance that actual results will not differ from the company's expectations. The Company has experienced fluctuating revenue, operating income and cash flow in some prior periods and expects this will occur from time to time in the future. As a result of these possible fluctuations, the Company's actual results may differ from our projections. Further, preliminary results are subject to normal year-end adjustments. Other factors that could cause such differences include the pace and timing of the consummation and integration of past and future acquisitions, the Company's ability to realize cost savings and efficiencies, competitive and general economic conditions, retention of staff and clients and other risks described under the heading "Item 1A. Risk Factors" in the Company's most recent Form 10-K and in the Company's other filings with the Securities and Exchange Commission. We are under no duty to update any of the forward-looking statements to conform such statements to actual results or events and do not intend to do so.

FINANCIAL TABLES FOLLOW

FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006
(in thousands, except per share data)

Year Ended December 31,
2007 2006
(unaudited)

Revenues $1,001,270 $707,933

Operating Expenses
Direct cost of revenues 548,407 389,032
Selling, general and administrative
expense 255,238 178,572
Special charges - 22,972
Amortization of other intangible assets 10,615 11,175
814,260 601,751

Operating income 187,010 106,182

Other income (expense)
Interest income 8,173 2,575
Interest expense and other (44,391) (29,405)
Litigation settlement losses, net (1,002) (187)
(37,220) (27,017)

Income before income tax provision 149,790 79,165

Income tax provision 57,669 37,141

Net income $92,121 $42,024

Earnings per common share - basic $2.14 $1.06
Weighted average common shares
outstanding - basic 43,028 39,741

Earnings per common share - diluted 2.00 $1.04
Weighted average common shares
outstanding - diluted 45,974 40,526

FTI CONSULTING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED DECEMBER 31, 2007 AND 2006
(in thousands, except per share data)

Three Months Ended
December 31,
2007 2006
(unaudited)

Revenues $280,519 $216,841

Operating expenses
Direct cost of revenues 151,746 112,136
Selling, general and administrative
expense 69,963 57,025
Special charges - -
Amortization of other intangible assets 2,837 2,865
224,546 172,026

Operating income 55,973 44,815

Other income (expense)
Interest income 4,182 688
Interest expense and other (10,393) (11,413)
Litigation settlement losses, net (130) (606)
(6,341) (11,331)

Income before income tax provision 49,632 33,484

Income tax provision 18,838 16,128

Net income (loss) $30,794 $17,356

Earnings (loss) per common share - basic $0.66 $0.43
Weighted average common shares
outstanding - basic 46,996 40,574

Earnings (loss) per common share - diluted $0.60 $0.42
Weighted average common shares
outstanding - diluted 51,347 41,392

FTI CONSULTING, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
(Unaudited)

Revenue
Average -
Bill Gener
Utiliz able ating
ation Rate Head
Revenues EBITDA(1) Margin (2) (2) count
(in thousands)
Three Months Ended
December 31, 2007
Forensic and Litigation
Consulting $54,770 $15,380 28.1% 71% $331 430
Corporate Finance 73,644 22,370 30.4% 82% $402 406
Economic Consulting 44,580 11,776 26.4% 81% $400 236
Technology 47,535 19,557 41.1% - - 344
Strategic Communications 59,990 16,147 26.9% - - 538
$280,519 85,230 30.4% 1,954
Corporate (20,943)
EBITDA (1) $64,287 22.9%

Year Ended
December 31, 2007
Forensic and Litigation
Consulting $217,028 $57,292 26.4% 75% $321 430
Corporate Finance 261,625 71,629 27.4% 80% $409 406
Economic Consulting 174,447 48,085 27.6% 85% $412 236
Technology 162,837 62,921 38.6% - - 344
Strategic Communications 185,333 48,826 26.3% - - 538
$1,001,270 288,753 28.8% 1,954
Corporate (72,779)
EBITDA (1) $215,974 21.6%

Three Months Ended
December 31, 2006
Forensic and Litigation
Consulting $51,229 $15,604 30.5% 76% $312 388
Corporate Finance 57,888 15,102 26.1% 82% $398 322
Economic Consulting 35,834 10,996 30.7% 81% $389 206
Technology 31,182 12,695 40.7% - - 256
Strategic Communications 40,708 14,173 34.8% - - 424
$216,841 68,570 31.6% 1,596
Corporate (17,693)
EBITDA (1) $50,877 23.5%

Year Ended
December 31, 2006
Forensic and Litigation
Consulting $193,287 $55,306 28.6% 78% $305 388
Corporate Finance 212,617 51,514 24.2% 77% $400 322
Economic Consulting 144,091 36,873 25.6% 80% $386 206
Technology 117,230 46,965 40.1% - - 256
Strategic Communications 40,708 14,173 34.8% - - 424
$707,933 204,831 28.9% 1,596
Corporate (51,492)
ADJUSTED EBITDA (1) $153,339 21.7%

(1) We use earnings before interest, taxes, depreciation, amortization
("EBITDA") and EBITDA excluding special charges ("adjusted EBITDA") in
evaluating the company's financial performance. EBITDA is not a
measurement under accounting principles generally accepted in the
United States ("GAAP"). We define EBITDA as operating income before
depreciation and amortization and amortization of intangible assets
plus litigation settlements. This measure may not be similar to non-
GAAP measures of other companies. We believe that the use of such
measures, as a supplement to operating income, net income and other
GAAP measures, is a useful indicator of a company's financial
performance and its ability to generate cash flow from operations that
are available to fund capital expenditures and service debt. Further,
these measures exclude certain items to provide better comparability
from period to period. While depreciation and amortization are
considered operating costs under GAAP, these expenses primarily
represent the non-cash current period allocation of costs associated
with long-lived assets acquired or constructed in prior periods.
EBITDA is a common alternative performance measure used by investors,
analysts and credit rating agencies to evaluate and compare the
operating performance and value of companies within our industry.
This non-GAAP measure should be considered in addition to, but not as
a substitute for or superior to, the information contained in our
statements of income. See also our reconciliation of Non-GAAP
financial measures.

(2) The majority of the Technology and Strategic Communications segments'
revenues are not generated on an hourly basis. Accordingly,
utilization and average billable rate metrics are not presented as
they are not meaningful. Utilization where presented is based on a
2,032 hour year.

FTI CONSULTING, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(in thousands, except per share data)
(unaudited)

Three Months Ended Year Ended
December 31, December 31,
2007 2006 2007 2006

Net income (loss) $30,794 $17,356 $92,121 $42,024

Earnings per common share-diluted $0.60 $0.42 $2.00 $1.04

Add back: Special charges $- $- $- $22,972
Less: tax effect - 10,039
Adjusted net income before special
charges (1) $30,794 $17,356 $92,121 $54,957

Adjusted earnings per common share-
diluted before special charges (1) $0.60 $0.42 $2.00 $1.36

(1) We use earnings before interest, taxes, depreciation, amortization
("EBITDA") and EBITDA excluding special charges ("adjusted EBITDA") in
evaluating the company's financial performance. EBITDA is not a
measurement under accounting principles generally accepted in the
United States ("GAAP"). We define EBITDA as operating income before
depreciation and amortization and amortization of intangible assets
plus litigation settlements. This measure may not be similar to non-
GAAP measures of other companies. We believe that the use of such
measures, as a supplement to operating income, net income and other
GAAP measures, is a useful indicator of a company's financial
performance and its ability to generate cash flow from operations that
are available to fund capital expenditures and service debt. Further,
these measures exclude certain items to provide better comparability
from period to period. While depreciation and amortization are
considered operating costs under GAAP, these expenses primarily
represent the non-cash current period allocation of costs associated
with long-lived assets acquired or constructed in prior periods.
EBITDA is a common alternative performance measure used by investors,
analysts and credit rating agencies to evaluate and compare the
operating performance and value of companies within our industry.
This non-GAAP measure should be considered in addition to, but not as
a substitute for or superior to, the information contained in our
statements of income. See also our reconciliation of Non-GAAP
financial measures.

RECONCILIATION OF OPERATING INCOME AND NET INCOME TO ADJUSTED EARNINGS
BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION AND SPECIAL CHARGES
(unaudited)

Three Months Ended Forensic and
December 31, 2007 Litigation Corporate Economic
Consulting Finance Consulting

Net income (loss)
Interest income
Interest expense and other
Litigation settlement losses
Income tax provision
Operating income $14,761 $21,876 $11,283
Depreciation 619 484 493
Amortization of other
intangible assets - - -
Litigation settlement losses - 10 -
EBITDA (1) 15,380 22,370 11,776
Special charges - - -
Adjusted EBITDA (1) $15,380 $22,370 $11,776

Year Ended December 31, 2007

Net income (loss)
Interest income
Interest expense and other
Litigation settlement losses
Income tax provision
Operating income $55,237 $70,574 $46,313
Depreciation 2,230 1,581 1,772
Amortization of other
intangible assets - - -
Litigation settlement losses (175) (526) -
EBITDA (1) 57,292 71,629 48,085
Special charges - - -
Adjusted EBITDA (1) $57,292 $71,629 $48,085

Three Months Ended
December 31, 2006

Net income (loss)
Interest income
Interest expense and other
Litigation settlement losses
Income tax provision
Operating income $15,163 $15,292 $10,631
Depreciation 441 310 365
Amortization of other
intangible assets - - -
Litigation settlement losses - (500) -
EBITDA (1) 15,604 15,102 10,996
Special charges - - -
Adjusted EBITDA (1) $15,604 $15,102 $10,996

Year Ended
December 31, 2006

Net income (loss)
Interest income
Interest expense and other
Litigation settlement losses
Income tax provision
Operating income $43,566 $43,181 $31,381
Depreciation 1,855 1,323 1,344
Amortization of other
intangible assets - - -
Litigation settlement losses (5) (730) -
EBITDA (1) 45,416 43,774 32,725
Special charges 9,890 7,740 4,148
Adjusted EBITDA (1) $55,306 $51,514 $36,873

Three Months Ended Strategic
December 31, 2007 Communi-
Technology cations Corp HQ Total

Net income (loss) $30,794
Interest income (4,182)
Interest expense and other 10,393
Litigation settlement losses 130
Income tax provision 18,838
Operating income $17,590 $15,583 $(25,120) 55,973
Depreciation 1,967 654 1,390 5,607
Amortization of other
intangible assets - - 2,837 2,837
Litigation settlement losses - (90) (50) (130)
EBITDA (1) 19,557 16,147 (20,943) 64,287
Special charges - - - -
Adjusted EBITDA (1) $19,557 $16,147 $(20,943) 64,287

Year Ended
December 31, 2007

Net income (loss) $92,121
Interest income (8,173)
Interest expense and other 44,391
Litigation settlement losses 1,002
Income tax provision 57,669
Operating income $56,298 $46,547 $(87,959) 187,010
Depreciation 6,623 2,376 4,769 19,351
Amortization of other
intangible assets - - 10,615 10,615
Litigation settlement losses - (97) (204) (1,002)
EBITDA (1) 62,921 48,826 (72,779) 215,974
Special charges - - - -
Adjusted EBITDA (1) $62,921 $48,826 $(72,779) $215,974

Three Months Ended
December 31, 2006

Net income (loss) $17,356
Interest income (688)
Interest expense and other 11,413
Litigation settlement losses 606
Income tax provision 16,128
Operating income $11,491 $13,726 $(21,488) 44,815
Depreciation &nb

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