FOURTH QUARTER 2021 HIGHLIGHTS

• Revenues increased $49.9 million, or 25.2%, to $248.3 million in Q4 2021 from $198.3 million in Q4 2020.
• Net income from continuing operations increased to $31.1 million in Q4 2021 compared to a net loss from continuing operations of $6.1 million in Q4 2020. Results for Q4 2021 include a $23.7 million gain, net of tax from the sale of the company's Life Sciences business in the fourth quarter of 2021. Results for Q4 2020 include $13.9 million of restructuring charges, net of tax related to the fourth quarter 2020 restructuring plan.
• Adjusted EBITDA⁽⁸⁾, a non-GAAP measure, increased $12.2 million, or 71.7%, to $29.3 million in Q4 2021 from $17.1 million in Q4 2020.
• Diluted earnings per share from continuing operations was $1.45 in Q4 2021 compared to diluted loss per share from continuing operations of $0.28 in Q4 2020.
• Adjusted diluted earnings per share from continuing operations⁽⁸⁾, a non-GAAP measure, excludes the gain on sale of the company's Life Sciences business and increased $0.35, or 77.8%, to $0.80 in Q4 2021 from $0.45 in Q4 2020.

FULL YEAR 2021 HIGHLIGHTS AND 2022 GUIDANCE

• Revenues increased $61.5 million, or 7.3%, to $905.6 million for full year 2021 compared to $844.1 million for full year 2020.
• Net income from continuing operations was $63.0 million for full year 2021 compared to a net loss from continuing operations of $23.7 million for full year 2020. Results for full year 2021 include a $23.7 million gain, net of tax from the sale of the company's Life Sciences business in the fourth quarter of 2021. Results for full year 2020 include non-cash goodwill impairment charges, net of tax of $45.3 million incurred in Q1 2020 related to the company's Strategy and Innovation and Life Sciences reporting units within the Business Advisory segment and $13.9 million of restructuring charges, net of tax related to the fourth quarter 2020 restructuring plan.
• Adjusted EBITDA⁽⁸⁾, a non-GAAP measure, increased $10.7 million, or 12.3%, to $97.8 million for full year 2021 compared to $87.1 million for full year 2020.
• Diluted earnings per share from continuing operations was $2.89 for full year 2021 compared to diluted loss per share from continuing operations of $1.08 for full year 2020.
• Adjusted diluted earnings per share from continuing operations⁽⁸⁾, a non-GAAP measure, excludes the gain on sale of the company's Life Sciences business and increased $0.46, or 21.4%, to $2.61 for full year 2021 from $2.15 for full year 2020.
• Huron provides full year 2022 guidance, including revenue expectations in a range of $970.0 million to $1.03 billion.
• Effective January 1, 2022, Huron has modified its operating model to expand and more deeply integrate the company’s industry expertise with its digital, strategic and financial advisory capabilities to accelerate growth and margin expansion.

Global professional services firm Huron (NASDAQ: HURN) today announced financial results from continuing operations for the fourth quarter ended December 31, 2021.

“We continued to deliver on our commitment to sustainable revenue growth and improved profitability, demonstrated by our Q4 2021 and full year results,” said James H. Roth, chief executive officer, Huron. “Led by organic growth across all three operating segments, annual revenues grew 7% and full year adjusted EBITDA margin improved 50 basis points over the prior year. We believe favorable market conditions across our core industries will provide a solid foundation for continued growth and profitability into 2022 as our clients address strategic and operational uncertainties.”

“We recently established a new operating model to strengthen our go-to-market strategy and better position Huron to integrate our deep industry expertise with our strong digital, strategy and financial advisory capabilities. Our business alignment builds upon the historical collaboration across our teams while creating a platform to drive greater efficiencies companywide, which we believe will provide improved growth and profitability for our shareholders,” added Roth.

COVID-19 IMPACT

The worldwide spread of the coronavirus (COVID-19) has created significant volatility, uncertainty and disruption to the global economy. The company continues to closely monitor the impact of the pandemic on all aspects of its business, including how it will impact its clients, employees and business partners. In most of 2020 and the first quarter of 2021, the COVID-19 pandemic negatively impacted sales and elongated the sales cycle for new opportunities for certain services, particularly within the company's Healthcare and Education segments as some clients reprioritized or delayed certain projects. Conversely, the pandemic strengthened demand for the company's cloud-based technology and analytics solutions and certain services provided to organizations in transition within the company's Business Advisory segment.

Beginning in the second quarter of 2021 and continuing through the end of 2021, the company saw an increase in its sales pipeline and the pace of signings, particularly within its Healthcare and Education businesses, as well as strengthened demand across all segments. As a result, fourth quarter and full year 2021 revenues increased compared to the same prior year periods. The company expects continued revenue growth in 2022 compared to 2021.

FOURTH QUARTER 2021 RESULTS FROM CONTINUING OPERATIONS

Revenues increased $49.9 million, or 25.2%, to $248.3 million for the fourth quarter of 2021 compared to $198.3 million for the fourth quarter of 2020.

Net income from continuing operations increased to $31.1 million for the fourth quarter of 2021, compared to a net loss from continuing operations of $6.1 million for the same quarter last year. Diluted earnings per share from continuing operations was $1.45 for the fourth quarter of 2021, compared to diluted loss per share from continuing operations of $0.28 for the fourth quarter of 2020. Results for the fourth quarter of 2021 include a $23.7 million gain, net of tax from the sale of the company's Life Sciences business in the fourth quarter of 2021. Results for the fourth quarter of 2020 reflect $13.9 million of restructuring charges, net of tax related to the fourth quarter 2020 restructuring plan.

Fourth quarter 2021 earnings before interest, taxes, depreciation and amortization ("EBITDA")⁽⁸⁾ was $50.0 million compared to loss before interest, taxes, depreciation and amortization of $1.9 million in the same prior year period.

In addition to using EBITDA to evaluate the company’s financial performance, management uses other non-GAAP financial measures, which exclude the effect of the following items (in thousands):

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⁽¹⁾ On November 1, 2021, the company completed the divestiture of its Life Sciences commercial and R&D strategy, pricing and market access strategy business (the "Life Sciences business"), and recognized a $31.5 million pre-tax gain related to the sale. The Life Sciences business generated revenues of $1.9 million in October 2021.

Adjusted EBITDA⁽⁸⁾ increased $12.2 million, or 71.7%, to $29.3 million, or 11.8% of revenues, in the fourth quarter of 2021, compared to $17.1 million, or 8.6% of revenues, in the same quarter last year. Adjusted net income from continuing operations⁽⁸⁾ increased $7.0 million to $17.2 million, or $0.80 per diluted share, for the fourth quarter of 2021, compared to $10.2 million, or $0.45 per diluted share, for the quarter in 2020.

The average number of billable consultants⁽²⁾ increased 9.7% to 2,880 in the fourth quarter of 2021 from 2,626 in the same quarter last year. Billable consultant utilization rate⁽³⁾ was 70.0% during the fourth quarter of 2021 compared to 68.0% during the same period last year. Average billing rate per hour for our billable consultants⁽⁴⁾ was $231 for the fourth quarter of 2021 compared to $206 for the same prior year period. The average number of full-time equivalent professionals⁽⁶⁾ was 301 in the fourth quarter of 2021 compared to 263 for the same period in 2020. The average number of Healthcare Managed Services employees⁽⁷⁾ was 513 in the fourth quarter of 2021 compared to 92 for the same period in 2020. This operating data has been revised from previously reported amounts as the company began assessing its operating performance by the following three employee types in the second quarter of 2021: billable consultants, full-time equivalents, and Healthcare Managed Services employees.

FULL YEAR 2021 RESULTS FROM CONTINUING OPERATIONS

Revenues increased $61.5 million, or 7.3%, to $905.6 million for full year 2021, compared to $844.1 million for full year 2020.

Net income from continuing operations was $63.0 million for full year 2021, compared to a net loss from continuing operations of $23.7 million for full year 2020. Diluted earnings per share from continuing operations was $2.89 for full year 2021, compared to diluted loss per share from continuing operations of $1.08 for full year 2020. Results for full year 2021 include a $23.7 million gain, net of tax from the sale of the company's Life Sciences business in the fourth quarter of 2021. Results for full year 2020 reflect non-cash goodwill impairment charges, net of tax totaling $45.3 million to reduce the carrying value of goodwill in the company's Strategy and Innovation and Life Sciences reporting units within the Business Advisory segment and $13.9 million of restructuring charges, net of tax related to the fourth quarter 2020 restructuring plan.

EBITDA⁽⁸⁾ was $114.5 million for the full year 2021, compared to $5.1 million for full year 2020.

In addition to using EBITDA to evaluate the company’s financial performance, management uses other non-GAAP financial measures, which exclude the effect of the following items (in thousands):

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⁽¹⁾ On November 1, 2021, the company completed the divestiture of its Life Sciences business, and recognized a $31.5 million pre-tax gain related to the sale. The Life Sciences business generated revenues of $16.7 million during the ten months ended October 31, 2021.

Adjusted EBITDA⁽⁸⁾ increased $10.7 million, or 12.3%, to $97.8 million, or 10.8% of revenues, for full year 2021 compared to $87.1 million, or 10.3% of revenues, for full year 2020. Adjusted net income from continuing operations⁽⁸⁾ increased $9.0 million to $56.9 million, or $2.61 per diluted share, for full year 2021 compared to $47.9 million, or $2.15 per diluted share, for full year 2020.

The average number of billable consultants⁽²⁾ increased 4.5% to 2,716 for full year 2021 from 2,600 for the same prior year period. Billable consultant utilization rate⁽³⁾ was 71.1% for full year 2021, compared to 70.7% in the same period last year. Average billing rate per hour for billable consultants⁽⁴⁾ was $209 for full year 2021, compared to $202 in the same period last year. The average number of full-time equivalent professionals⁽⁶⁾ was 258 for full year 2021 compared to 269 for the same prior year period. The average number of Healthcare Managed Services employees⁽⁷⁾ was 382 for full year 2021 compared to 91 for the same period in 2020. This operating data has been revised from previously reported amounts as the company began assessing its operating performance by the following three employee types in the second quarter of 2021: billable consultants, full-time equivalents, and Healthcare Managed Services employees.

OPERATING SEGMENTS

Huron’s results reflect a portfolio of service offerings focused on helping clients address complex business challenges.

The company’s full year 2021 revenues by operating segment as a percentage of total company revenues are as follows: Healthcare (42%); Business Advisory (32%); and Education (26%). Financial results by segment are included in the attached schedules and in Huron's forthcoming Annual Report on Form 10-K filing for the year ended December 31, 2021.

OUTLOOK FOR 2022

Based on currently available information, the company provided guidance for full year 2022 revenues before reimbursable expenses in a range of $970.0 million to $1.03 billion. The company anticipates adjusted EBITDA as a percentage of revenues in a range of 11.3% to 12.3% and non-GAAP adjusted diluted earnings per share in a range of $2.85 to $3.35.

Management will provide a more detailed discussion of its outlook during the company's earnings conference call webcast.

FOURTH QUARTER 2021 WEBCAST

The company will host a webcast to discuss its financial results today, February 24, 2022, at 5:00 p.m. Eastern Time, 4:00 p.m. Central Time. The conference call is being webcast by NASDAQ and can be accessed from Huron's website at http://ir.huronconsultinggroup.com. A replay will be available approximately two hours after the conclusion of the webcast and for 90 days thereafter.

2022 BUSINESS REALIGNMENT AND CHANGES TO SEGMENT REPORTING

Effective January 1, 2022, Huron has modified its operating model to expand and more deeply integrate the company’s industry expertise with its digital, strategic and financial advisory capabilities. The new operating model will strengthen Huron’s go-to-market strategy, drive efficiencies that support margin expansion, and position the company to accelerate growth.

To align with the new operating model, effective with reporting for periods beginning January 1, 2022, the company will begin reporting under the following three industries, which will be the company's reportable segments: Healthcare, Education and Commercial. The Commercial segment will include all industries outside of healthcare and education, including, but not limited to, financial services and energy and utilities. In the new reporting structure, each segment will include all revenues and costs associated with engagements delivered in the respective industry segment. The new Healthcare and Education segments will include some revenues and costs historically reported in the Business Advisory segment and the Healthcare segment will include certain revenues and costs historically reported in the Education segment. The company will also provide revenue reporting across two principal capabilities: i) Consulting and Managed Services and ii) Digital. These changes will provide greater transparency for investors by improving visibility into the core drivers of the business.

Supplemental materials that include unaudited recast summary financial information and other operating data according to the new reporting segments can be found on the investor relations section of Huron's website at http://ir.huronconsultinggroup.com.

VIRTUAL INVESTOR DAY

Huron will host an Investor Day on Tuesday, March 29, 2022. The Investor Day will be held virtually and begin at 9:00 a.m. Eastern Time (8:00 a.m. Central Time). Interested parties are encouraged to pre-register for the event here and log in to the webcast approximately 10 minutes prior to the start of the event.

Chief executive officer James H. Roth, chief financial officer John D. Kelly, president and chief operating officer C. Mark Hussey and other members of Huron’s leadership team will provide an update on the company’s strategy and segment reporting changes. In addition to management’s prepared remarks, there will be a question-and-answer session.

After the conclusion of the event, a transcript and a replay of the video webcast, including the Q&A session, will be available on the investor relations section of Huron’s website at http://ir.huronconsultinggroup.com and will be available for one year.

USE OF NON-GAAP FINANCIAL MEASURES⁽⁸⁾

In evaluating the company’s financial performance and outlook, management uses EBITDA, adjusted EBITDA, adjusted EBITDA as a percentage of revenues, adjusted net income from continuing operations, and adjusted diluted earnings per share from continuing operations, which are non-GAAP measures. Management uses these non-GAAP financial measures to gain an understanding of the company's comparative operating performance (when comparing such results with previous periods or forecasts). These non-GAAP financial measures are used by management in their financial and operating decision making because management believes they reflect the company's ongoing business in a manner that allows for meaningful period-to-period comparisons. Management also uses these non-GAAP financial measures when publicly providing their business outlook, for internal management purposes, and as a basis for evaluating potential acquisitions and dispositions. Management believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Huron’s current operating performance and future prospects in the same manner as management does, if they so choose, and in comparing in a consistent manner Huron’s current financial results with Huron’s past financial results. Investors should recognize that these non-GAAP measures might not be comparable to similarly titled measures of other companies. These measures should be considered in addition to, and not as a substitute for or superior to, any measure of performance, cash flows or liquidity prepared in accordance with accounting principles generally accepted in the United States.

Management has provided its outlook regarding adjusted EBITDA and adjusted diluted earnings per share, both of which are non-GAAP financial measures and exclude certain charges. Management has not reconciled these non-GAAP financial measures to the corresponding GAAP financial measures because guidance for the various reconciling items is not provided. Management is unable to provide guidance for these reconciling items because they cannot determine their probable significance, as certain items are outside of the company's control and cannot be reasonably predicted since these items could vary significantly from period to period. Accordingly, reconciliations to the corresponding GAAP financial measures are not available without unreasonable effort.

ABOUT HURON

Huron is a global consultancy that collaborates with clients to drive strategic growth, ignite innovation and navigate constant change. Through a combination of strategy, expertise and creativity, we help clients accelerate operational, digital and cultural transformation, enabling the change they need to own their future. By embracing diverse perspectives, encouraging new ideas and challenging the status quo, we create sustainable results for the organizations we serve. Learn more at www.huronconsultinggroup.com.

Statements in this press release that are not historical in nature, including those concerning the company’s current expectations about its future results, are “forward-looking” statements as defined in Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified by words such as “may,” “should,” “expects,” “provides,” “anticipates,” “assumes,” “can,” “will,” “meets,” “could,” “likely,” “intends,” “might,” “predicts,” “seeks,” “would,” “believes,” “estimates,” “plans,” “continues,” “guidance,” or “outlook” or similar expressions. These forward-looking statements reflect the company's current expectations about future requirements and needs, results, levels of activity, performance, or achievements. Some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: the impact of the COVID-19 pandemic on the economy, our clients and client demand for our services, and our ability to sell and provide services, including the measures taken by governmental authorities and businesses in response to the pandemic, which may cause or contribute to other risks and uncertainties that we face; failure to achieve expected utilization rates, billing rates and the number of revenue-generating professionals; inability to expand or adjust our service offerings in response to market demands; our dependence on renewal of client-based services; dependence on new business and retention of current clients and qualified personnel; failure to maintain third-party provider relationships and strategic alliances; inability to license technology to and from third parties; the impairment of goodwill; various factors related to income and other taxes; difficulties in successfully integrating the businesses we acquire and achieving expected benefits from such acquisitions; risks relating to privacy, information security, and related laws and standards; and a general downturn in market conditions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors, including, among others, those described under “Item 1A. Risk Factors” in Huron's Annual Report on Form 10-K for the year ended December 31, 2021 that may cause actual results, levels of activity, performance or achievements to be materially different from any anticipated results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. The company disclaims any obligation to update or revise any forward-looking statements as a result of new information or future events, or for any other reason.

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