8-K
HACKETT GROUP, INC. (HCKT)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): July 30, 2020
The Hackett Group, Inc.
(Exact name of registrant as specified in its charter)
| FLORIDA | 333-48123 | 65-0750100 |
|---|---|---|
| (State or other jurisdiction of<br><br><br>incorporation or organization) | (Commission File Number) | (I.R.S. Employer<br><br><br>Identification No.) |
| 1001 Brickell Bay Drive, Suite 3000<br><br><br>Miami, Florida | 33131 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
(305) 375-8005
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR § 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR § 240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $.001 per share | HCKT | NASDAQ Stock Market |
Item 2.02 Results of Operations and Financial Condition.
On August 4, 2020, The Hackett Group, Inc. (the “Company”) issued a press release setting forth its consolidated financial results for the second fiscal quarter ended June 26, 2020. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein.
The information contained in Item 2.02 of this current report on Form 8-K, as well as Exhibit 99.1, is being furnished to the Securities and Exchange Commission and shall not be deemed “filed” with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Revised Executive Compensation Decisions for 2020. At its meeting held on February 12, 2020, the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”) reviewed and approved the 2020 base salaries and cash and equity incentive plan targets for the Company’s named executive officers as well as the Company’s other senior leaders. Consistent with prior years, the Compensation Committee approved a program for the Company’s named executive officers that, in addition to base salaries, would pay annual cash and equity incentive awards in connection with the achievement of challenging 2020 pro forma diluted net earnings per share performance targets. The Compensation Committee established these performance targets for 2020 without the benefit of being able to consider the impact of the COVID-19 pandemic on the Company’s results of operations for 2020.
In light of the COVID-19 pandemic, the Compensation Committee reviewed the previously established performance targets to determine whether they appropriately align the Company Incentive Compensation including executive compensation opportunities with the Company’s current forecast and objectives. As a result of that review, at its meeting on July 30, 2020, the Compensation Committee established new annual targets and made other revisions to the program.
Under the revised program, the Company’s total pro forma diluted net earnings per share for the first, third and fourth quarters of 2020 must meet or exceed the total pro forma diluted earnings per share for the first, third and fourth quarters of 2019 in order for the named executive officers to earn their “Goal” cash and equity performance incentive awards. The Compensation Committee believes that this Goal opportunity would effectively require the achievement of an annual pro forma diluted earnings per share target for fiscal 2020 that is very aggressive given the significant demand volatility and uncertainties. The annual cash and equity incentive compensation earned at the revised Goal target would equal seventy-five (75%) of the Goal opportunity previously approved by the Compensation Committee on February 12, 2020. This is also the maximum that can be earned under the revised program. Under the revised program, the “Superior” cash and equity performance incentive award level has been eliminated.
The Compensation Committee believes the revised program is better aligned with the current outlook for the Company given the business disruption from the COVID-19 pandemic and also ensures that the program continues to serve as a performance driver for 2020, with challenging goals.
Item 9.01 Financial Statements and Exhibits.
| (d) | Exhibits |
|---|---|
| Exhibit<br><br><br>Number | Description |
| --- | --- |
| 99.1 | Press Release of The Hackett Group, Inc., dated August 4, 2020 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| THE HACKETT GROUP, INC. | ||
|---|---|---|
| Date: August 4, 2020 | By: | /s/ Robert A. Ramirez |
| Robert A. Ramirez | ||
| Executive Vice President, Finance and Chief Financial Officer |
hckt-ex991_6.htm
Exhibit 99.1
Contact:
Robert A. Ramirez, CFO, 305-375-8005 or rramirez@thehackettgroup.com
The Hackett Group Announces Second Quarter 2020 Results
| • | Q2 2020 net revenue of $52.6 million and pro forma EPS of $0.06 |
|---|---|
| • | Q2 2020 GAAP loss per share of $0.13, compared to EPS of $0.22 in the prior year due to a $5.0 million COVID-19 restructuring charge to reduce global workforce |
| --- | --- |
| • | Q2 2020 ending cash balance of $37.4 million and no outstanding debt |
| --- | --- |
| • | Board of Directors declared a 9.5 cent quarterly dividend |
| --- | --- |
MIAMI, FL – August 4, 2020 - The Hackett Group, Inc. (NASDAQ: HCKT), a global intellectual property-based strategic consultancy and leading enterprise benchmarking and best practices digital transformation firm, today announced its financial results for the second quarter, which ended on June 26, 2020.
Q2 2020 net revenue (gross revenue less reimbursable expenses) was $52.6 million, down 23%, as compared to the same period in the prior year.
GAAP diluted loss per share were $0.13 for the second quarter of 2020, as compared to GAAP diluted earnings per share of $0.22 in the same period in the prior year. GAAP results for the second quarter of 2020 included a $5.0 million, or $0.13 per diluted share, restructuring charge related to the reduction of the Company’s global workforce due to the economic disruption from the coronavirus pandemic.
Q2 2020 pro forma diluted earnings per share were $0.06, as compared to $0.28 in the same period in the prior year, due to the economic disruption resulting from the coronavirus pandemic and the Company’s decision to forgo a significant level of profitability to maintain staffing levels throughout the second quarter. Pro forma information is provided to enhance the understanding of the Company’s financial performance and is reconciled to the Company’s GAAP information in the accompanying tables.
At its most recent meeting, the Company’s Board of Directors declared a quarterly dividend of 9.5 cents per share for its shareholders of record on September 25, 2020, to be paid on October 9, 2020.
At the end of the second quarter of 2020, the Company’s cash balances were $37.4 million. During the quarter, the Company did not draw down on its credit facility. As of the end of the second quarter of 2020, the Company’s remaining share repurchase program authorization was $5.6 million.
“Our operating results reflect the expected revenue declines from the coronavirus economic disruption and our decision to forgo profitability during the quarter in order to protect our associates until we had a much better assessment of the impact of the pandemic,” stated Ted A. Fernandez, Chairman & CEO of the Hackett Group, Inc. “I am very proud of our associates’ ability to quickly take the necessary safety precautions while also successfully adapting to our clients’ virtual service delivery requirements. We are also pleased to finish the quarter with such a
strong cash position without any debt which allowed us to take the necessary actions while continuing our dividend and remain strongly poised for the expected economic recovery.”
Although economic uncertainty from the COVID-19 pandemic continues to be high, the Company’s current estimates suggest that net revenue for the third quarter of 2020 will be in the range of $52.0 million to $54.0 million. The Company estimates pro forma diluted earnings per share for the third quarter of 2020 to be in the range of $0.13 and $0.15.
Other Highlights
Digital Awards Winners - The Hackett Group announced the winners of its 2020 Digital Awards, which spotlighted companies that are on the cutting edge of digital business practice. This year’s winners are IBM (artificial intelligence), Deutsche Telekom Services Europe (DTSE) (automation), DBS Bank (digital transformation), and Genpact, in collaboration with the Envision Virgin Racing Formula E Team (analytics). In addition, three companies were named as finalists in the competition: Nationwide Insurance, ABB, and Infosys BPM.
Working Capital Survey - The 1000 largest non-financial companies in the U.S. slowed payments to suppliers slightly in 2019 as they collected cash from customers more slowly and held slightly more inventory, causing overall working capital performance to decline after several years of improvement, according to the annual survey of The Hackett Group. At the same time, cash on hand and debt grew dramatically, reaching record levels. But according to The Hackett Group’s research team, the global pandemic has sparked a dramatic increase in focus on working capital and overall liquidity in 2020, driving many companies to launch comprehensive transformation efforts for the first time as they try to determine what their business will look like as the world economy emerges from the crisis.
Coronavirus Response Center - The Hackett Group continued to expand its Coronavirus Response Center, which was launched in March as part of its Web site. The center currently features nearly 30 pieces of research that offers guidance and insights for leaders in corporate finance, procurement and supply chain, human resources, information technology, and more. In addition, The Hackett Group’s Blog now includes nearly 20 posts that address pandemic response issues.
UVARS Award - Answerthink, a division of The Hackett Group and member of United VARs, announced that United VARs has received a 2020 SAP® Pinnacle Award as the Global Platinum Reseller of the Year, recognizing its outstanding contributions as an SAP partner. SAP presents these awards annually to the top partners that have excelled in developing and growing their partnership with SAP and helping customers run better. Winners and finalists in 34 categories were chosen based on recommendations from the SAP field, customer feedback, and performance indicators.
On Tuesday August 4, 2020, senior management will discuss second quarter results in a conference call at 5:00 P.M. ET. (800) 593-0486, [Passcode: Second Quarter]. For International callers, please dial (517) 308-9371. Please dial in at least 5-10 minutes prior to start time. If you are unable to participate on the conference call, a rebroadcast will be available beginning at 8:00 P.M. ET on Tuesday, August 4, 2020 and will run through 5:00 P.M. ET on Tuesday, August 18, 2020. To access the rebroadcast, please dial (800) 856-2259. For International callers, please dial (402) 280-9962. In addition, The Hackett Group will also be webcasting this conference call live through the StreetEvents.com service. To participate, simply visit http://www.thehackettgroup.com approximately 10 minutes prior to the start of the call and click on the conference call link provided. An online replay of the call will be available after 8:00 P.M. ET on Tuesday, August 4, 2020 and will run through 5:00 P.M. ET on Tuesday, August 18, 2020. To access the replay, visit www.thehackettgroup.com or http://www.streetevents.com.
About The Hackett Group
The Hackett Group (NASDAQ: HCKT) is an intellectual property-based strategic consultancy and leading enterprise benchmarking and best practices digital transformation firm to global companies, with offerings that include robotic process automation and enterprise cloud application implementation. Services include business transformation, enterprise analytics and global business services. The Hackett Group also provides dedicated expertise in business strategy, operations, finance, human capital management, strategic sourcing, procurement and information technology, including its award-winning Oracle and SAP practices.
The Hackett Group has completed nearly 18,000 benchmarking studies with major corporations and government agencies, including 93% of the Dow Jones Industrials, 90% of the Fortune 100, 83% of the DAX 30 and 57% of the FTSE 100. These studies drive Hackett’s Digital Transformation Platform which includes the firm's benchmarking metrics, best practices repository and best practice configuration guides and process flows, which enable The Hackett Group’s clients and partners to achieve world-class performance.
More information on The Hackett Group is available at: www.thehackettgroup.com, info@thehackettgroup.com, or by calling (770) 225-3600.
#
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks, uncertainties and other factors that may cause The Hackett Group's actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. Factors that impact such forward-looking statements include, among others, the impact of the coronavirus pandemic, including the duration and severity of the pandemic, the economic impact of the pandemic and the timing of an economic recovery, our ability to manage our business and capital resources through the pandemic, the ability of our products, services, or offerings mentioned in this release to deliver the desired effect, our ability to retain existing business, our ability to attract additional business, our ability to effectively market and sell our product offerings and other services, including those referenced above, the timing of projects and the potential for contract cancellations by our customers, especially given that our clients are also impacted by the coronavirus pandemic, changes in expectations regarding the business consulting and information technology industries, our ability to attract and retain skilled employees, possible changes in collections of accounts receivable due to the bankruptcy or financial difficulties of our customers, risks of competition, price and margin trends, foreign currency fluctuations, the impact of Brexit on our business, changes in general economic conditions and interest rates, our ability to mitigate the impact of the recent decline in our European operations, our ability to obtain debt financing through additional borrowings under our existing credit facility as well as other risks detailed in our Annual Report on Form 10-K for the most recent fiscal year and our Quarterly Report on Form 10-Q for the first fiscal quarter of fiscal 2020, each as filed with the Securities and Exchange Commission. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Page 4 of 7 - The Hackett Group, Inc. Announces Second Quarter Results
The Hackett Group, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
| Quarter Ended | Six Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 26, | June 28, | June 26, | June 28, | |||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||
| REVENUE: | ||||||||||||
| Revenue before reimbursements ("net revenue") | $ | 52,632 | $ | 67,976 | $ | 117,818 | $ | 130,346 | ||||
| Reimbursements | 119 | 5,545 | 4,466 | 10,330 | ||||||||
| TOTAL REVENUE FROM CONTINUING OPERATIONS | 52,751 | 73,521 | 122,284 | 140,676 | ||||||||
| COSTS AND EXPENSES: | ||||||||||||
| Cost of service: | ||||||||||||
| Personnel costs before reimbursable expenses | 38,654 | 40,820 | 79,767 | 79,754 | ||||||||
| Non-cash stock compensation expense | 1,600 | 1,022 | 2,941 | 1,942 | ||||||||
| Acquisition-related compensation expense (benefit) | 29 | (159 | ) | 29 | (288 | ) | ||||||
| Acquisition-related non-cash stock compensation expense | 259 | 289 | 512 | 368 | ||||||||
| Reimbursable expenses | 119 | 5,545 | 4,466 | 10,330 | ||||||||
| TOTAL COST OF SERVICE | 40,661 | 47,517 | 87,715 | 92,106 | ||||||||
| Selling, general and administrative costs | 11,413 | 15,159 | 25,310 | 29,201 | ||||||||
| Non-cash stock compensation expense | 483 | 787 | 1,119 | 1,492 | ||||||||
| Amortization of intangible assets | 238 | 254 | 476 | 553 | ||||||||
| Acquisition-related contingent consideration liability | - | 45 | - | (1,025 | ) | |||||||
| Restructuring costs | 5,034 | - | 5,034 | - | ||||||||
| TOTAL SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 17,168 | 16,245 | 31,939 | 30,221 | ||||||||
| TOTAL COSTS AND OPERATING EXPENSES | 57,829 | 63,762 | 119,654 | 122,327 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | (5,078 | ) | 9,759 | 2,630 | 18,349 | |||||||
| Other expense: | ||||||||||||
| Interest expense | (41 | ) | (105 | ) | (78 | ) | (206 | ) | ||||
| INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (5,119 | ) | 9,654 | 2,552 | 18,143 | |||||||
| Income tax (benefit) expense | (1,186 | ) | 2,614 | 950 | 4,054 | |||||||
| INCOME (LOSS) FROM CONTINUING OPERATIONS | (3,933 | ) | 7,040 | 1,602 | 14,089 | |||||||
| Loss from discontinued operations (2) | - | (51 | ) | (8 | ) | (6 | ) | |||||
| NET INCOME (LOSS) | $ | (3,933 | ) | $ | 6,989 | $ | 1,594 | $ | 14,083 | |||
| Basic net income (loss) per common share: | ||||||||||||
| Income (loss) per common share from continuing operations | $ | (0.13 | ) | $ | 0.23 | $ | 0.05 | $ | 0.47 | |||
| Weighted average common shares outstanding | 30,015 | 29,823 | 29,952 | 29,753 | ||||||||
| Diluted net income (loss) per common share: | ||||||||||||
| Income (loss) per common share from continuing operations | $ | (0.13 | ) | $ | 0.22 | $ | 0.05 | $ | 0.44 | |||
| Weighted average common and common equivalent share<br><br><br>outstanding (3) | 30,015 | 32,374 | 32,301 | 32,334 |
Page 5 of 7 - The Hackett Group, Inc. Announces Second Quarter Results
| PRO FORMA DATA (1): | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Income (loss) from continuing operations before income taxes | $ | (5,119 | ) | $ | 9,654 | $ | 2,552 | $ | 18,143 | ||
| Non-cash stock compensation expense | 2,083 | 1,809 | 4,060 | 3,434 | |||||||
| Acquisition-related compensation expense (benefit) | 29 | (159 | ) | 29 | (288 | ) | |||||
| Acquisition-related non-cash stock compensation expense | 259 | 289 | 512 | 368 | |||||||
| Acquisition-related contingent consideration liability | - | 45 | - | (1,025 | ) | ||||||
| Restructuring costs | 5,034 | - | 5,034 | - | |||||||
| Amortization of intangible assets | 238 | 254 | 476 | 553 | |||||||
| PRO FORMA INCOME BEFORE INCOME TAXES | 2,524 | 11,892 | 12,663 | 21,185 | |||||||
| Pro forma income tax expense | 631 | 2,973 | 3,166 | 5,296 | |||||||
| PRO FORMA NET INCOME | $ | 1,893 | $ | 8,919 | $ | 9,497 | $ | 15,889 | |||
| Pro forma basic net income per common share | $ | 0.06 | $ | 0.30 | $ | 0.32 | $ | 0.53 | |||
| Weighted average common shares outstanding | 30,015 | 29,823 | 29,952 | 29,753 | |||||||
| Pro forma diluted net income per common share | $ | 0.06 | $ | 0.28 | $ | 0.29 | $ | 0.49 | |||
| Weighted average common and common equivalent shares<br><br><br>outstanding (3) | 30,015 | 32,374 | 32,301 | 32,334 |
(1)The Company provides pro forma earnings results (which exclude the amortization of intangible assets, non-cash stock compensation expense, acquisition-related one-time expense (benefit), and include a normalized tax rate, which is our long-term projected cash tax rate) as a complement to results provided in accordance with Generally Accepted Accounting Principles (GAAP). These non-GAAP results are provided to enhance the overall users' understanding of the Company's current financial performance and its prospects for the future. The Company believes the non-GAAP results provide useful information to both management and investors and by excluding certain expenses that it believes are not indicative of its core operating results. The non-GAAP measures are included to provide investors and management with an alternative method for assessing operating results in a manner that is focused on the performance of ongoing operations and to provide a more consistent basis for comparison between quarters. Further, these non-GAAP results are one of the primary indicators management uses for planning and forecasting in future periods. In addition, since the Company has historically reported non-GAAP results to the investment community, it believes the continued inclusion of non-GAAP results provides consistency in its financial reporting. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP.
(2) Discontinued operations relate to the discontinuance of the Company’s European Working Capital group.
(3) For the period in which the Company has reported a net loss, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders, because dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.
Page 6 of 7 - The Hackett Group, Inc. Announces Second Quarter Results
The Hackett Group, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
| June 26, | December 27, | |||
|---|---|---|---|---|
| 2020 | 2019 | |||
| ASSETS | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 37,370 | $ | 25,954 |
| Accounts receivable and unbilled revenue, net | 36,962 | 49,778 | ||
| Prepaid expenses and other current assets | 3,719 | 2,895 | ||
| Total current assets | 78,051 | 78,627 | ||
| Property and equipment, net | 19,724 | 19,916 | ||
| Other assets | 2,052 | 2,652 | ||
| Goodwill | 83,880 | 84,578 | ||
| Operating lease right-of-use assets | 8,753 | 7,962 | ||
| Total assets | $ | 192,460 | $ | 193,735 |
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 4,739 | $ | 8,494 |
| Accrued expenses and other liabilities | 34,810 | 32,482 | ||
| Operating lease liabilities | 2,701 | 2,707 | ||
| Total current liabilities | 42,250 | 43,683 | ||
| Long-term deferred tax liability, net | 7,577 | 7,183 | ||
| Operating lease liabilities | 6,052 | 5,255 | ||
| Total liabilities | 55,879 | 56,121 | ||
| Shareholders' equity | 136,581 | 137,614 | ||
| Total liabilities and shareholders' equity | $ | 192,460 | $ | 193,735 |
Page 7 of 7 - The Hackett Group, Inc. Announces Second Quarter Results
The Hackett Group, Inc.
SUPPLEMENTAL FINANCIAL DATA
(unaudited)
| Quarter Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| June 26, | June 28, | March 27, | |||||||
| 2020 | 2019 | 2020 | |||||||
| Revenue Breakdown by Group: | |||||||||
| (in thousands) | |||||||||
| S&BT (4) | $ | 16,798 | $ | 26,261 | $ | 24,462 | |||
| EEA (5) | 31,399 | 31,005 | 33,223 | ||||||
| International (6) | 4,435 | 10,710 | 7,500 | ||||||
| Net revenue from continuing operations (7) | $ | 52,632 | $ | 67,976 | $ | 65,186 | |||
| Revenue Concentration: | |||||||||
| (% of total revenue) | |||||||||
| Top customer | 6 | % | 4 | % | 4 | % | |||
| Top 5 customers | 17 | % | 16 | % | 15 | % | |||
| Top 10 customers | 27 | % | 25 | % | 25 | % | |||
| Key Metrics and Other Financial Data: | |||||||||
| Total Company: | |||||||||
| Consultant headcount | 908 | 999 | 1,026 | ||||||
| Total headcount | 1,110 | 1,240 | 1,243 | ||||||
| Days sales outstanding (DSO) | 64 | 68 | 70 | ||||||
| Cash provided by operating activities (in thousands) | $ | 14,547 | $ | 11,273 | $ | 6,521 | |||
| Pro forma return on equity (8) | 20 | % | 26 | % | 24 | % | |||
| Depreciation (in thousands) | $ | 883 | $ | 830 | $ | 800 | |||
| Amortization (in thousands) | $ | 238 | $ | 254 | $ | 238 | |||
| Remaining Plan authorization: | |||||||||
| Shares purchased (in thousands) | - | 92 | 73 | ||||||
| Cost of shares repurchased (in thousands) | $ | — | $ | 1,440 | $ | 1,006 | |||
| Average price per share of shares purchased | $ | — | $ | 15.59 | $ | 13.79 | |||
| Remaining Plan authorization (in thousands) | $ | 5,645 | $ | 3,878 | $ | 5,645 | |||
| Shares Purchased to Satisfy Employee Net Vesting Obligations: | |||||||||
| Shares purchased (in thousands) | 2 | 1 | 125 | ||||||
| Cost of shares purchased (in thousands) | $ | 25 | $ | 14 | $ | 1,962 | |||
| Average price per share of shares purchased | $ | 13.29 | $ | 16.39 | $ | 15.70 |
(4) Strategy and Business Transformation Group (S&BT) includes the results of our IP as-a-service offerings, which includes our North America Executive Advisory Programs, our Benchmarking Services and our Business Transformation Practices.
(5) ERP, EPM and Analytics Solutions (EEA) includes the results of our Oracle EEA and SAP Solutions Practices.
(6) International Groups include the results of our S&BT and EEA Practices, primarily in Europe.
(7) Net revenue excludes reimbursable expenses which are primarily travel-related expenses passed through to a client with no associated margin.
(8) Twelve months of pro forma net income divided by average shareholder's equity.
(9) Certain reclassifications have been made to conform with current reporting requirements.