Good morning and welcome to the FTI Consulting Third Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. At this time, I would like to turn the conference over to Mollie Hawkes, Managing Director of Investor Relations. Please go ahead.

Good morning. Welcome to the FTI Consulting Conference Call to discuss the company's third quarter of 2018 earnings results reported this morning. Management will begin with formal remarks, after which, we'll take your questions. Before we begin, I would like to remind everyone that this conference call may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21 of the Securities Exchange Act of 1934 that involve risks and uncertainties. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events, future revenues, future results and performance, expectations, plans or intentions related to financial performance, acquisitions, share repurchases, business trends and other information or other matters that are not historical, including statements regarding estimates of our future financial results and other matters. For discussion of risks and other factors that may cause actual results or events to differ from those contemplated by forward-looking statements, investors should review the Safe Harbor statement in the earnings press release issued this morning, a copy of which is available on our website at www.fticonsulting.com as well as other disclosures under the heading of Risk Factors and Forward-Looking Information in our Form 10-K for the year-ended December 31, 2017, and Form 10-Q for the quarter-ended September 30, 2018 and in other filings filed with the SEC. Investors are cautioned not to place undue reliance on any forward-looking statements, which speaks only as of the date of this earnings call and will not be updated. During the call, we will discuss certain non-GAAP financial measures, such as total segment operating income, adjusted EBITDA, total adjusted segment EBITDA, adjusted earnings per diluted share, adjusted net income, adjusted EBITDA margin, and free cash flow. For discussion of these and other non-GAAP financial measures, as well as our reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures, investors should review the press release and the accompanying financial tables that we issued this morning, which include the reconciliations. Lastly, there are two items that have been posted to our Investor Relations section of our website this morning for your reference. These include a quarterly earnings presentation, and an Excel and PDF of our historical financial and operating data, which have been updated to include our third quarter of 2018 results. Of note, during today's prepared remarks, management will not speak directly to the quarterly earnings presentation posted to the Investor Relations website. To ensure disclosures are consistent, these slides provide the same details as they have historically and, as I said, are available on our Investor Relations section of our website. With these formalities out of the way, I am joined today by Steve Gunby, our President and Chief Executive Officer; and Ajay Sabherwal, our Chief Financial Officer. At this time, I will turn the call over to our President and Chief Executive Officer, Steve Gunby.

Thank you, Mollie, and good morning and thank you for joining us today. I'm sure many of you saw the press release this morning. This quarter, we once again delivered terrific results. I'm pleased to share them with you along with Ajay. It was another record quarter for revenues with revenues increasing 14% year-over-year and all of that 14% was organic growth. That terrific revenue growth translated into earnings per share of $1.14 and adjusted EPS of $1 per share. Ajay will go through those results in more detail shortly. But we thought, I would start by sharing a few perspectives on those results. As I think most folks on this call know, in this company, and in fact, I believe in this industry, quarterly results almost always reflect a combination of factors, some are the sort of fundamental persistent forces that we've been trying to drive to build this company, the fixes we've made, investments we've made, and the successes we are having on those efforts. But some of them are set of short-term factors that are much more random, factors that can cut substantially one way or the other in any given quarter. We have, over the last over years, strengthened this company enormously and this quarter's and this year's results reflect powerfully that multi-year trend. But this year, we also benefited from some short-term factors that cut in our favor. I'd like to elaborate on these points a bit. As we've talked about in the past, there are a lot of short-term factors that can influence and over the past several years have influenced quarterly results one way or the other. I'm sure you will recall us talking about the success fees or tax catch-ups or losing or winning some particularly large jobs or surges or lags…

Thank you, Steve. Good morning, everybody. I will start by summarizing our results. Then, I will review quarter-over-quarter and certain sequential quarter results at the segment level and key cash flow and balance sheet items. After that, I will discuss guidance for the year. First, the highlights of the quarter. With 14.3% growth from the prior year quarter, we set a new record for quarterly revenues. Each of our segments grew year-over-year with particularly strong results in our Economic Consulting and Technology segments. We successfully monetized our Ringtail e-discovery software and related business. And with our convertible note issuance, we lowered our future cash interest expense. Moving onto the details. Third quarter revenues of $513 million, were up $64 million from $449 million in the prior year quarter. Fully diluted earnings per share, our EPS of $1.14 in 3Q 2018 compared to $0.85 in 3Q 2017. This includes the $0.16 gain related to the sale of our Ringtail e-discovery software and related business, which was slightly offset by a $0.02 reduction in EPS from the non-cash interest expense, which represents the amortization of the carrying value of the equity component of our convertible notes. Adjusted EPS, which exclude the Ringtail-related gain and convertible note non-cash interest expense, were $1, which compares to $0.83 in the prior-year quarter. Third quarter 2018 net income of $44.3 million compared to net income of $32.2 million in the prior-year quarter. The increase in net income was largely due to higher operating profits and the $6.2 million gain, net of taxes, related to the sale of Ringtail. Third quarter 2018 adjusted EBITDA of $67.4 million or 13.1% of revenues compared to $57.4 million or 12.8% of revenues in the prior-year quarter. The increase in adjusted EBITDA was primarily due to higher revenues, which were partially…

Thank you, Mr. Sabherwal. We will now begin the question-and-answer session. And your first question this morning will be from Tobey Sommer of SunTrust. Please go ahead.

Hey, guys. This is Joseph Thompson on the line for Tobey this morning. Thank you for taking my question. First of all...

Good morning, Joseph.

Good morning. I was interested in – you mentioned towards the beginning of the call that you believe you're going to win more big jobs. What – are you seeing a pick-up in prospects for big business? Any additional color on this would be nice. Thanks.

Look, let me – I think, the winning or losing of big jobs is essentially a very random event that effects our financials in a short-term way significantly, and I think that was the main point that I was just trying to underscore. I believe that one of the reasons over the last three, four years we've had sustained growth is because of the talent we've attracted, the way we've been directing that talent, the strategies we've had have allowed us to win a higher share of big jobs in various places around the business. So, I believe, but it's hard to find the data that there is a long-term trend of us winning more and more big jobs that is driving some of the long-term success. But the other point I was making is that can get trumped by any short-term factors up and down. And in the beginning of, like 18 months ago, we happened to swing and missed out a couple of big jobs and that had led us to have terrible results in that quarter. And this year, we just seemed to be hitting on everyone. And we don't believe – even though we believe our long-term batting average is getting better, we're not sure – we don't believe it was as bad as it showed up in early part of 2017 and we're not sure that we're yet guiding our sustained batting average to the current level. So, does that give you at least a qualitative sense, Joseph?

Yeah. That's helpful. Thanks. Yeah, I'll jump back in the queue.

Thanks, Joseph.

And the next question will be from Tim McHugh of William Blair. Please go ahead. Tim J. McHugh - William Blair & Co. LLC: Yes. I guess, just maybe following up, Steven on your initial theme a little bit, which was, as you said, kind of temper a little bit expectation. I guess, can you help us more, I guess quantifiably, think about what is normal for or FTI at this point when you – on one hand, I know you're winning more big jobs, but yet, the pace you're saying was higher than normal and you're hiring more. So, the best way I guess, I can think of it, is an EBITDA margin or something like that. What's normal, I guess and what should our expectations be as we think about a year or two from now for what a normal performance level is?

Let me say one thing and then Ajay is kicking under the table, because he wants us to be very precise on what we're saying about the future. Look, I think what I've said over time is, what I believed is, for a while, the company underperformed talent of its – of the terrific talent we have and the positions we have in the marketplace. And that if we just hit some of the right things with the talent we have and the ability to attract talent, we can deliver sustained double-digit growth with a lot of noise any given quarter, which can be, you can be up 100% in a quarter, you can be down 100% in a quarter. That's not the real factors. The real thing is the sustained growth through it. And I think the data I've seen through now four years or more than four years is that that's true. When we bet on the right professionals, we grow our business. Now, that still can get trumped for any two, three quarters by winning or losing of the big job. But when you bet on the right professionals, you have the hard-nosed right strategies, you grow businesses and when you kid yourself, you don't. And so, I think, we can deliver sustained, I think we've been saying that's a way, sustained double-digit EPS growth over time. And that's kind of what we have been saying now for a while. Obviously, you can see this year is a very high – is very high compared to sustained double-digit EPS this year and part of that is why I'm underscoring this. Let me see if Ajay wants to add anything?

No, no. I think you've captured it. No. Tim, we'll – we'll give guidance for 2019 in the late February-March timeframe when we announce our fourth quarter results. I'm not going to get ahead of that. We've given fourth quarter guidance, which assumes, as I said, some moderation and so on and so forth. And we've been doing that literally every quarter. And every quarter, we've been pleasantly surprised at the upside. I mean, this quarter, we're absolutely delighted that we did see some moderation sequentially in FLC and CF, but more than made up in Economics and Technology. So, this is fantastic. We're delighted by it, may it long continue, but our guidance has been on double-digit – sustained double-digit earnings growth overtime through a combination of use of cash and EBITDA growth. This year, it's almost exclusively from EBITDA growth and it's well more than small double-digit, it's very high. So, we're shaping those expectations, without in any way, taking away from the fantastic performance.

Or without taking away from a perception that we believe the – this company is going to continue to grow and develop in a powerful way over the next years. Yeah. Tim, does that... Tim J. McHugh - William Blair & Co. LLC: Okay.

...does our – detailed quantification, does that help a little bit? Tim J. McHugh - William Blair & Co. LLC: Yeah, a little bit. I get you, you want to be cautious about what you're saying about 2019, I guess. But maybe, one other way of asking it is, when you say your response is kind of focused on double-digit growth over a sustained long period of time. Is 2018 a level at which you can grow from? I mean, is that still fair? I mean, if we're using your response or do we have to discount that?

So, again, no. This is a key point and obviously you're hitting on the absolute point that I would expect you to hit on. We're not going to give 2019 guidance yet. We -I'm not going to tell you that one thing and then change it four months from now. We'd like to grow every year, we'd like to grow handsomely everywhere. 2018 is way above our expectations. Virtually, every quarter has been way above our expectations. And we work hard at giving the guidance and we've exceeded that guidance. We don't want to take away from our practitioners from that success, but surely, these are ahead of our expectations.

And, Tim, let me just say one other thing. We had a few bad quarters in a row, maybe the end of 2016, beginning of 2017. And I didn't believe that those actually reflected what was going on in the company. I thought there were a series of short-term factors that were obscuring it and we tried our best to telegraph that in a strong way. And I guess, I was too new as CEO or whatever. I'm not sure the market believed it. And so, the stock was pummeled by that. And no, we went out and bought a bunch of shares, which was good for us, but I was frustrated by the lack of credibility that we had that said the company is going places and yet, people don't believe. And so, I think, one of the things I wanted to do this year was make sure that where those cut the other way, be transparent about that. So, we're trying to be as transparent as we can be always and where we think some short-term factors have helped our results, we're going to say that. And hopefully, if we have short-term factors go the other way at some point in the future, then people will believe us, when we say, that's not something you pay attention to. So, that's part of the reason we emphasize this year. Does that make sense? Tim J. McHugh - William Blair & Co. LLC: Yeah. That's fair enough. Can I just ask, on the Ringtail divestiture, how we think about the financial impact of that on kind of an ongoing basis?

Yeah. I'll give you more color on that. Completely understand. So, the licensing revenue, Tim, is shy of 10% of our total Ringtail – of total Technology segment revenues. It's between 5% and 10% of the total revenue. And on an EBITDA basis, it was a negative contributor. So, that – what that means is, the R&D expenditure and the other direct cost or other SG&A cost, like in sales, marketing, et cetera, exceeded the revenue. So, through the divestiture, it's EBITDA accretive, it's even more – somewhat even more cash accretive, because there's also capitalized R&D and that capitalized R&D will go away, because we don't do R&D, it'll be replaced by a license fee that's capitalized and amortized in a year. But that license fee is less than what we were spending in R&D. So, positive on EBITDA just from the divestiture and positive on cash as well, marginally accretive to EBITDA. Tim J. McHugh - William Blair & Co. LLC: Okay. Thank you.

Thanks, Tim.

And the next question will be from Marc Riddick of Sidoti. Please go ahead. Marc Riddick - Sidoti & Co. LLC: Hi. Good morning.

Good morning, Marc. Marc Riddick - Sidoti & Co. LLC: I wanted to go back to some of the big picture kind of questions around the beginning of your commentary and I wanted to see if you could put a little more background into it? When you're talking about larger jobs, I wanted to get a sense of when you're talking about, let's say, a comparable large job today versus maybe five years ago, can you sort of give us maybe what you're seeing as to, is it a function of complexity as far as what's leading to these jobs lasting longer and then I know it's kind of a general concept and a bit squishy, but I'm trying to get a sense of what's making a similar job last longer and potentially maybe have a different impact than maybe it might have five years ago?

Yeah. So, I don't know that it has a different impact than it did five years ago. I think what we're really seeing are some more random factors. What makes it last longer is much more – sometimes, you're able to help a client get to a position where they can end the case quickly or settle the case quickly. That's very helpful from the client's point of view, but then your billings – and that's what our job is, but then the billings go away and sometimes the issues persist. So, the end or not has much more to do with the context of a specific litigation for example, or a specific assignment than it does to anything with respect to macro factors or changes we've made. So, whether a thing ends fast or not is somewhat random, I believe. And the size of the large jobs can vary across the board. They can (00:45:50) vary. But I don't know that the big jobs are bigger now than they were five years ago, maybe they are.

Well, there are more of them.

There are more of them, that's the issue (00:45:57).

So, we would have historically and I've now only been here two plus years. But historically, to have the one big job in one segment and I have big job in multiple segments. Like here, this quarter, we had a huge job for its size in – for technology (00:46:13) in Technology, similarly in Economics. And we had some roll-off of similar jobs in CF and FLC. This is what's truly exceptional that every segment is doing well.

And I would say, actually picking up on that, there is some predictability in the sense that if you have a second request, like one of the tech job here was a second request, that tends to be pretty defined timeframe and it comes and goes pretty quickly and it always has. Investigations are tend to be more complicated. Some of them can be fast, some of them can be short, some of them can be long and so forth. Does that give you a feel, Marc? Marc Riddick - Sidoti & Co. LLC: Yeah, that's helpful. And I guess, maybe to piggyback on that then, are you getting a sense, because you've always kind of worked with large clients and law firms, what have you – I was wondering if you're getting any sense of, is there any change in client behavior when it comes to their willingness to work with you on multiple things, as far as, not necessarily just from a cross-selling kind of perspective, but also maybe their – how clients are looking at potential, I don't want to call them conflicts, but potential factors in similar industries, if you will? I mean, are they more willing to be more active, even if you're working in a similar area with other competitors or is there any change in that client attitude or behavior as far as how much they're willing to engage with you?

So I'm not sure that there's a fundamental change in the client mental map. I think what has happened are two things. We have, over the last several years through a lot of work by a lot of people, strengthened the individual businesses. And so, we just have more practitioners with – who are at the top end of the game than we did three, four, five years ago. And that means, we have more people who will get reached out to for the largest jobs in the marketplace. I just think, I mean, that is the fundamental – our – look, we will do lots of small jobs and we'll do everything and we'll do, focus on it. But our brand gets built off of these very large jobs the ones you know about. And we have more and more people in more and more parts of our business that are capable of winning those jobs. So, that's the first point. That's the one where we've made the most progress. The second place where we've made some progress is more systematically introducing ourselves to our ultimate clients. Historically, we did most of our work through law firms. We still get hired by the law firms. And the law firms are usually interested in a very narrow definition of they want the e-discovery team or they want the damages team. As we've gotten to know general counsels of major companies, they actually like the fact that they can deal with fewer people on a very sensitive issue, somebody who can help them, not only on their damages, but their investigation, perhaps their external and internal communications. So, we are moving to deal with a latent client demand for much more integrated services that we historically haven't – haven't done. But I think, that's more future looking, that's been a part of our success over the last few years. But I think, it's more opportunity going forward. I think, the bigger driver of the success over the last few years has been the strengthening of the individual businesses by our leadership teams by the practitioners in there. And then, on top of that Marc, there's always some luck in any given quarter. Does that help? Marc Riddick - Sidoti & Co. LLC: There's nothing wrong with that. So, I appreciate it. Thank you for the color.

No, great.

Thank you. Ladies and gentlemen, this will conclude our question-and-answer session. I would like to hand the conference back to Steven Gunby for his closing remarks.

Well, thank you all again for your time today and more generally – look, let me just close by reiterating the theme, particularly of this Q&A. There are short-term factors that can affect our results – that affected our results negatively for a few quarters that we talked about that we felt like we need to comment on it. I believe, that have benefited our results this year. And so, we believe in transparency of doing that. But, please don't misunderstand that. I think, Ajay and I are incredibly proud of what the team has done here and confident that the team is going to continue to go and build our business over any medium-term going forward. And that's the second message that we hoped you took away from the call. So, thank you very much for your support.

Thank you, sir. Ladies and gentlemen, the conference has concluded. Thank you for attending today's presentation. At this time, you may disconnect your lines.