Good morning, and welcome to Charles River Associates Third Quarter Fiscal Year 2013 Conference Call. Today's call is being recorded. You may listen to the webcast on CRA's website located at www.crai.com. In addition, today's news release and prepared remarks from the company's Chief Financial Officer are posted on the Investor Relations section of the site. With us today are CRA's President and Chief Executive Officer, Paul Maleh; and Chief Financial Officer, Wayne Mackie. At this time, for opening remarks and introductions, I'd like to turn the call over to Mr. Mackie. Please go ahead, sir.

Thank you, Kevin. Statements made during this conference call concerning the future business, operating results, tax rates and financial condition of the company and statements using the terms believes, expects, should, prospects, target, remain encouraged, opportunities or similar expressions are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon management's current expectations and are subject to a number of factors and uncertainties. Information contained in these forward-looking statements is inherently uncertain, and actual performance and results may differ materially due to many important factors. Such factors that could cause actual performance and results to differ materially from any forward-looking statements made by the company are included in the company's filings with the Securities and Exchange Commission in today's news release and prepared CFO remarks. The company cannot guarantee any future results, levels of activity, performance or achievement. The company undertakes no obligation to update any of its forward-looking statements after the date of this call. Let me remind everyone that we will be referring to some non-GAAP financial items on this call, as well as adjusted EBITDA. I would encourage everyone to refer to today's earnings release for a full reconciliation of these non-GAAP items to their GAAP equivalents, as well as the calculation of adjusted EBITDA based on GAAP and non-GAAP results. Let me now turn it over to Paul Maleh for his report. Paul?

Thanks, Wayne, and good morning, everyone. In Q3 of fiscal 2013, CRA delivered top and bottom line results. And we are pleased with the broad based improvement across our portfolio. Third quarter contributions from both litigation and regulatory and management consulting resulted in a 13.8% sequential revenue growth and 12.8% year-over-year revenue growth on a non-GAAP basis. We delivered company-wide utilization of 78% during the quarter, and our profitability also was enhanced, resulting in an adjusted EBITDA margin based on non-GAAP results of 16.7%. Our growth during the third quarter was driven by broad-based demand and positive contributions from nearly all practice areas. Five` practice areas delivered more than a 20% increase in revenue on a sequential basis, including Auctions & Competitive Bidding, Finance, Intellectual Property, Marakon and Transfer Pricing. Each of these practices benefited from ongoing assignments and new project wins. I'd like to take a moment to describe some highlights from the quarter. First, our Litigation and Regulatory revenue grew in the third quarter sequentially and year-over-year by 9.1% and 21%, respectively, on a non-GAAP basis. This growth was led by our Antitrust & Competition Economics practice, which continued to deliver high levels of performance. Q3 was our third consecutive quarter of record revenue in our Antitrust & Competition Economics practice. Our Litigation and Regulatory portfolio was also involved in a variety of matters, including in the healthcare sector around hospital mergers and other transactions, pharmaceutical-related litigation and reimbursement disputes. For example, one matter brought together the talents from our Antitrust & Competition Economics and Finance practices to look at the competitive effects and financial viability of a hospital merger currently under investigation. These 2 practices also combine resources to assist key financial institutions on their regulatory and litigation matters. Competition authorities and Financial Market regulators around the…

Thanks, Paul. As a reminder, a more detailed report of my remarks on the financial results can be found on the Investor Relations section of our website. Right now, I will cover a few key metrics. In terms of key -- in terms of headcount, we ended the third fiscal quarter with 456 consulting staff, which consisted of 336 senior staff and 120 junior staff. This is a net decrease of 19 consultants from the 475 we reported at the end of Q2 of fiscal 2013, the majority of which were junior staff members. No key revenue generated departed during the quarter. As Paul mentioned, our company-wide utilization was up significantly at 78% for Q3 of fiscal 2013, compared with 67% in both Q3 of fiscal 2012 and Q2 of fiscal 2013. The momentum we experienced during the end of the second quarter continued throughout the third quarter. We continue to target utilization level in the mid-70s going forward. Our international revenue contribution for this quarter was 19%, down from the 22% recorded in Q3 of fiscal 2012 and 21% we recorded in fiscal -- in Q2 of fiscal 2013. Q3 2013 non-GAAP gross margin was 31.2%, up sequentially from 30.2% in Q2 of fiscal 2013. The increase in gross margin percentage in Q3 of our fiscal 2013, compared with Q2 of fiscal 2013, was due principally to a decrease in reimbursable expenses coupled with the increase in net revenue. For the third quarter of fiscal 2013 adjusted EBITDA, based on non-GAAP results, was $12.2 million or 16.7% of revenues compared with $9.6 million or 14.8% of revenue for Q3 of fiscal 2012. As Paul mentioned, we are pleased with this adjusted EBITDA margin during the third quarter of fiscal 2013. Turning to the balance sheet. DSO at the end…

[Operator Instructions] Our first question today is coming from Joseph Foresi from Janney Capital Markets.

I was wondering if you could talk a little bit more in detail about the uptick that we saw in business. How much of that is macro related? And how much of that is just CRA performance?

Probably a little bit of both. I think we saw a slight thawing in the M&A marketplace which, I believe, contributed to the improvement in performance. The other thing -- the other main factor is what I referenced during my section, is that a lot of these leads that we had during the first half of 2013 and the conversion into projects started to pay dividends. By that, I mean started generating revenue in June and continued through the third quarter. So that was a final realization of a lot of effort for us to increase our market-facing activity. The other part is the improvement was across practically every single one of our practices. So that, I'm going to point to being a more CRA as opposed to driven only by one economic factor like increased M&A activity.

Okay. Maybe you could provide us a little bit more color around the numbers. Have you seen an increase in the number of engagements in totality? Is there any lumpy engagements in there that might end or begin? And then if you could give us any color around how you ended the quarter from a momentum perspective?

Sure. We did not see a substantive increase in large engagements that I've said. This uptick, clearly, we have some large engagements serving as a foundation within the firm. But there are a number of -- there's a number of those engagements, and they're across several practice areas. So I wouldn't attribute the uptick to one large engagement that improved in productivity. The outlook, as we mentioned, we're all focused on lead flow and opportunities and the conversion of those lead flow. That has been relatively healthy. And activity, since the end of the quarter, has been pretty consistent with what we've seen during Q3.

Great. Okay, last question for me. On the margin front, you rightsized the business from a cost perspective, I think, over the last couple of quarters, and SG&A has stayed pretty static from that perspective. In order to continue to address these new opportunities, do you feel like you're going to have to add any cost? Or is this a case of you having those resources available for you and now utilize them?

There's a little bit -- there will always be a slight increase in cost associated with our marketing-related expenses. And I would bear those costs every day. We've made investments over the past couple years by both restructuring our real estate portfolio, improving the infrastructure underlying our financial administration systems. And those investments don't need to be repeated in the years ahead and are actually capable of being scaled as revenue grows. So the large ticket items, I think, should remain relatively constant.

Our next question today is coming from David Gold from Sidoti & Company. David Gold - Sidoti & Company, LLC: A couple of points of color, if you will. First, was curious if you can give a sense – from here, I know you commented utilization outlook, 70s, obviously a nice jump sequentially at 78%. But as we sort of look, are you still holding a 70% target? Or is it more a function of fourth quarter seasonality that'll get you down some?

Sure. When we provide our target, that is a target for our expectations for the next quarter. It is not meant to be an indication of what we think the weighted average for the entire year will be based on Q3 and Q4. So our target going into Q4 is to try to achieve utilization in the low to mid-70s. Year-to-date, we're probably about at 70% or 71% in cumulative utilization for the firm. David Gold - Sidoti & Company, LLC: Got you, okay. And then not sure how to ask this. But I guess, when we go back to the last call, one of the things that was a big topic was the forgivable loans and sort of thinking about that versus if you acquired the practice or if you hired them and gave them forgivable loans. And I guess, would be curious on if you can, is when we look at the growth that you saw in the third quarter, if we thought about that group hire as an acquisition, basically, how much of the growth was coming from that? In other words, how much would you deem then organic versus acquired?

Sure. The largest component of the new consultants who joined us has to do with the addition of our Chicago partner's colleagues, which touches upon our Competition and Antitrust Economics practice and our Finance group. That group had basically been screening or running pretty close to expectations since joining us. So the quarter-over-quarter contribution has been constant, and thus, the growth that we achieved from Q2 or Q3 is really attributable to other parts of the portfolio. That, in no way, is saying that they did not perform handsomely, they did. But the fact is they performed handsomely in Q3, they performed handsomely in Q2 and even going back to Q1. So it's the contributions from other parts of the firm that are really creating these attractive results. David Gold - Sidoti & Company, LLC: Got you, okay. And then one other. When we think about the lead flow that you've had sort of through 2013 and something we talked about earlier in the year, now starting to convert as you've seen it in the third quarter, what do you attribute that to? I mean, has anything changed? Is it just seasoning and the time it takes to bring the work in-house? Or is there anything else out there? Do you see a climate change where more work is coming through and that's -- and obviously we're beneficiary?

I wish I -- you sort of see it. You sort of know it when you see it, but I can't necessarily predict exactly what's driving it. I know there's been a lot of hard work by my colleagues to get in front of clients, present new IP to our clients and try to enhance the clients' products that we're putting out there. Clearly, the addition of the quality of these senior professionals over the past 12 months have helped our market-facing activity. But it's hard work by a lot of individuals getting out to the marketplace and seeing, realizing these opportunities. David Gold - Sidoti & Company, LLC: Okay. Got you, okay. And then just the last one I'll just bother you with. I'm not sure – I know you said it was down year-to-year, but did you give a harder number on the Management Consulting portion of the business?

David, in terms of the percentage of revenue this quarter, we don't give specific segment information. But historically, it has been in the 25-plus percent range of total revenues. This quarter, it's about in that range, it's perhaps a little bit below, but a very substantial improvement from the first half of the year. So we're actually very happy with our Management Consulting contribution this quarter and, hopefully, moving on.

[Operator Instructions] Our next question today is coming from Tim McHugh from William Blair & Company. Timothy McHugh - William Blair & Company L.L.C., Research Division: Just a few follow-ups. One, I guess, as we're talking about Management Consulting, if we think about the full year, recognizing on the lumpiness, how do you feel about the ability to have positive growth there this year? And I guess, I'm trying to make sense of the lumpiness we've seen and just smooth it out in terms of the full year performance you're expecting now.

Sure. We're expecting growth in Management Consulting, second half relative to the first half of 2013. I think with the slow start to 2013, we do not expect to see year-over-year improvement in that segment. But clearly, the prospects that have been brought in, in the past number of months indicate a much stronger second half of 2013. David Gold - Sidoti & Company, LLC: Okay. And Wayne, I apologize, I missed the headcount numbers, can you give those again?

The headcount numbers? Timothy McHugh - William Blair & Company L.L.C., Research Division: Yes, yes, the consultants.

Sure. The numbers at the end of Q3 are 456 consultants in total, of which 336 are senior consultants and 120 junior consultants. Would you like the Q2 numbers of the year -- this year? Timothy McHugh - William Blair & Company L.L.C., Research Division: No, no, no, I have those. I guess one other things from a numbers perspective. So the cost of the forgivable loans, especially as we think towards 2014, how do we -- how do those costs trend? Is this a pretty consistent level of expense we have to model in here for another year or 2? Or does that level of expense gradually trend down?

I think right now, if we keep our portfolio constant and we do not hire or not recruit any other senior revenue-generating professionals, I think for the next couple of years, I would expect that number to stay relatively constant. Because a lot of these new additions in, for which we use the forgivable loans is acquisition capital, are relatively recent and their terms of their agreements are longer than the near-term horizon. Timothy McHugh - William Blair & Company L.L.C., Research Division: Okay. And then lastly, I guess, just high level, in terms of the just the kind of the ups and downs you've seen in the last few years, obviously, this feels better this quarter. As you look at it, is there anything that you look at in terms of the nature of the projects or the nature of the pipeline that gives you any additional, I guess, clarity or confidence that this may be the start of kind of smoother upward trend? Or is it just too hard to tell?

I think it all has to do with the Red Sox. We worked hard in the past few years. We had to make some really difficult decisions. But the portfolio of practices and the portfolio of professionals that we have today is of a higher quality than it has been relative to past years. And what made the first half of 2013 so frustrating is that when we'd look at our portfolio, we knew it was a better asset, but we weren't delivering the performance that was commensurate with the quality of that asset. So what gives us confidence going forward is we're much closer to the core values of our brand. And thus, I think that should prevail in the marketplace. So we just have to try to get some repeat performance here in the quarters ahead. But it's the quality of the portfolio that has changed.

At this time, we've reached the end of our question-and-answer session. I will now turn the conference over back to Mr. Maleh for any closing or additional remarks.

Again, thank you to everyone for joining us today. As always, we appreciate your time and interest in CRA and look forward to updating you on our progress next quarter. With that, this concludes today's call. Thank you, everyone.

Thank you. That does conclude today's teleconference. You may disconnect your lines at this time, and have a wonderful day. We thank you for your participation today.