When someone has been cooking the books, FTI Consulting has a recipe for recovery. The company is one of the leading providers of consulting services related to corporate finance and restructuring (through FD International and other units). It also offers forensic accounting, litigation support, and investigative services to companies confronted with problems fraud in order to assist them in their legal defense or pursuit of recoveries. Other consulting service areas include economics, strategic and financial communications, and technology. FTI's main clients are large business enterprises and major law firms. The business was established in 1982.
Outside the US, where the company has offices in about 35 cities, FTI and its subsidiaries maintain facilities in 24 countries spanning Africa, the Asia/Pacific region, Europe, Latin America, and the Middle East. US-based clients account for the vast majority (around 75%) of sales, however.
FTI divides its operations into five segments: Corporate Finance/Restructuring, Forensic and Litigation Consulting, Economic Consulting, Technology, and Strategic Communications. The firm generates a wide diversity of its revenue across these segments; no one segment accounts for a vast majority of total sales.
Despite several years of steady increases in revenue and profits, FTI Consulting saw its net income plunge roughly 50% from $143 million to $72 million during 2009 to 2010. It attributes the drop to more than $52 million in expenses it paid as it realigned its operational infrastructure to adjust to expected demand for its services. Throughout 2010 it reduced its workforce, acquired additional trade names, and consolidated four office locations.
From 2010 to 2011, however, FTI saw positive results from these actions as net revenue increased by 12% and its net income surged by 57%. The overall increases in 2011 were the result of its previous restructuring efforts and organic growth from all its segments except Technology and Corporate Finance/Restructuring Consulting.
In order to grow, FTI has diversified its service offerings and expanded its geographic reach through a number of acquisitions of niche-market firms. In 2012 it acquired the assets of KordaMentha, a corporate finance advisory and restructuring firm based in Brisbane, Australia, and the Gold Coast. It made the purchase to establish a Corporate Finance/Restructuring practice in Australia.
The previous year FTI obtained the International Arbitration and Airline Competition practices belonging to LECG Corporation. Bolstering its international business, it also purchased LECG's European competition policy, financial advisory services, and tax consultancy practices located in Brussels, London, Madrid, and Paris.
Focusing on increasing its presence in the Asian market, in 2010 the company bought Baker Tilly Hong Kong Business Recovery Ltd., a firm providing forensic accounting, litigation support, and restructuring services based in Hong Kong. FTI also acquired FS Asia Advisory Limited, which provided financial services consulting expertise and owned offices in Hong Kong, Shanghai, Singapore, and Manila. Specifically, the purchase enhanced FTI's corporate finance, transaction advisory, restructuring, and strategic communications practices within the region. Also in 2010 FTI obtained The Schonbraun McCann Group, a real estate and finance consultancy, for $125 million. Along with previous acquisitions, the deal opened new channels for growth in Europe and Asia. – less
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