ITEM 7.01. Regulation FD Disclosure
FTI Consulting has included the definitions of Segment Operating Income (Loss), Adjusted Segment EBITDA and
Adjusted Segment EBITDA Margin, measures of financial condition or performance determined in accordance with U.S. generally accepted accounting principles (GAAP), below in order to more fully define the components of the
certain measures of financial condition or performance not determined in accordance with GAAP (Non-GAAP) presented in the Press Release. FTI Consulting defines Segment Operating Income (Loss) as a segments share of
Consolidated Operating Income (Loss) and Total Segment Operating Income (Loss) as the total of Segment Operating Income (Loss) for all segments, which excludes unallocated corporate expenses. FTI Consulting uses Segment Operating
Income (Loss) for the purpose of calculating Adjusted Segment EBITDA. FTI Consulting defines Adjusted Segment EBITDA as a segments share of Consolidated Operating Income (Loss) before depreciation, amortization of intangible
assets, remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges. FTI Consulting defines Adjusted Segment EBITDA Margin as Adjusted Segment EBITDA as a percentage of a segments
revenues. FTI Consulting uses Adjusted Segment EBITDA to internally evaluate the financial performance of its segments because FTI Consulting believes it is a useful measure which reflects current core operating performance and provides an indicator
of the segments ability to generate cash.
FTI Consulting defines Non-GAAP financial measures, (i) Total Adjusted Segment
EBITDA as the total of Adjusted Segment EBITDA for all segments, which excludes unallocated corporate expenses, and (ii) Adjusted EBITDA as Consolidated Net Income (Loss) before income tax provision, other non-operating income
(expense), depreciation, amortization of intangible assets, remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges and losses on early extinguishment of debt. FTI Consulting believes that its
Non-GAAP financial measures, when considered together with its GAAP financial results and GAAP financial measures, provide management and investors with a more complete understanding of FTI Consultings operating results, including underlying
trends, by excluding the effects of remeasurement of acquisition-related contingent consideration, special charges and goodwill impairment charges. In addition, EBITDA and Adjusted EBITDA are common alternative measures of operating performance used
by many of FTI Consultings competitors. They are used by investors, financial analysts, rating agencies and others to value and compare the financial performance of companies in FTI Consultings industry. Therefore, FTI Consulting also
believes that these Non-GAAP financial measures, considered along with corresponding GAAP financial measures, provide management and investors with additional supplemental information for comparison of FTI Consultings operating results to the
operating results of other companies.
2
FTI Consulting defines Adjusted Net Income and Adjusted Earnings per Diluted
Share (Adjusted EPS) as Net Income (Loss) and earnings per diluted share (GAAP EPS), respectively, excluding the impact of remeasurement of acquisition-related contingent consideration, special charges, goodwill
impairment charges and losses on early extinguishment of debt. FTI Consulting uses Adjusted Net Income for the purpose of calculating Adjusted EPS. FTI Consulting uses Adjusted EPS to assess total company operating performance on a consistent basis.
FTI Consulting believes that this Non-GAAP financial measure, when considered together with its GAAP financial results and GAAP financial measures, provides management and investors with a more complete understanding of its business operating
results, including underlying trends, by excluding the effects of remeasurement of acquisition-related contingent consideration, special charges, goodwill impairment charges and losses on early extinguishment of debt.
Non-GAAP financial measures are not defined in the same manner by all companies and may not be comparable to other similarly titled measures
of other companies. Non-GAAP financial measures should be considered in addition to, but not as a substitute for or superior to, the information contained in FTI Consultings Consolidated Statements of Comprehensive Income. Reconciliations of
Non-GAAP financial measures to GAAP are included in the financial tables accompanying the Press Release.
The financial tables
accompanying the Press Release do not include a reconciliation of FTI Consultings 2016 Adjusted EPS guidance to an estimate of GAAP EPS. It is difficult to predict and estimate future remeasurement of acquisition-related contingent
consideration, special charges, goodwill impairment charges and/or losses on early extinguishment of debt, as these items are dependent on future events that are uncertain. Accordingly, a reconciliation of FTI Consultings Non-GAAP financial
measure guidance to the corresponding GAAP financial measure is not available without unreasonable effort.
The information included
herein, including Exhibit 99.1 furnished herewith, shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities
of that section, nor shall it be incorporated by reference into any filing pursuant to the Securities Act of 1933, as amended, or the Exchange Act, regardless of any incorporation by reference language in any such filing, except as expressly set
forth by specific reference in such filing.