Good afternoon, ladies and gentlemen, and welcome to Huron Consulting Group’s webcast to discuss Financial Results for the Second Quarter 2016. At this time, all conference call lines are on a listen-only mode. Later, we will conduct our question-and-answer session for conference call participants and instructions will follow at that time. As a reminder, this conference call is being recorded. Before we begin, I would like to point all of you to the disclosure at the end of the Company’s news release for information about any forward-looking statements that may be made or discussed on this call. The news release is posted on Huron’s Web site. Please review that information along with the filings with the SEC for a disclosure of factors that may impact subjects discussed in this afternoon’s webcast. The Company will be discussing one or more non-GAAP financial measures. Please look at the earnings release and on Huron’s Web site for all of the disclosures required by the SEC including reconciliation to the most comparable GAAP numbers. And now, I would like to turn the call over to Jim Roth, Chief Executive Officer and President of Huron Consulting Group. Mr. Roth, please go ahead.

Good afternoon, and welcome to Huron Consulting Group’s second quarter 2016 earnings call. With me today is Mark Hussey, our Chief Operating Officer and Chief Financial Officer. Our second quarter results reflected strong performance from our Education & Life Sciences and Business Advisory segments. Well our Healthcare business continued to experience some softness, consistent with trends that we have seen over recent quarters. Let me provide some color on the Q2 performance for each of our segments, and then add our perspective for the rest of the year. I will then turn it over to Mark, so he can walk you through the financials. I’ll begin with Healthcare. During the second quarter, Healthcare revenues declined approximately 10% compared to the second quarter of last year and were down 7% sequentially. The sequential decline was roughly split between our cost in clinical and revenue cycle solutions. On a year-to-date basis, organic Healthcare revenues were down approximately 3.5% over the first half of 2015. On recent earning calls we discussed changes impacting our Healthcare business, including softness in the pipeline for fully integrated projects, a shift in clients’ buying patterns to more solution-specific engagements, and the need to reposition our offerings to respond to changing demand for our services. In the second quarter, our revenue cycle solutions faced some of the same market conditions that are cost in clinical solution as recently experienced. Our clients are procuring more discreet projects as they have begun to optimize our EHR systems to manage revenue cycle workflows. We've been preparing for this shift, and our efforts position us to offer a full range of services to support our clients’ revenue cycle needs, whether through standalone revenue cycle engagements, EHR optimization projects or a hybrid approach. To respond to the changing market for both our cost…

Thank you, Jim and good afternoon everyone. Before I begin, please note that I will be discussing non-GAAP financial measures such as EBITDA, adjusted EBITDA, adjusted net income, adjusted EPS and free cash flow. Our press release, 10-Q and Investor Relations page on the Company Web site each have reconciliations of these non-GAAP measures to the most comparable GAAP measures, along with a discussion of why management uses these non-GAAP measures. Also, our acquisition of the U.S. business of ADI Strategies, which closed in May, is included in our second quarter financial results in our Business Advisory segment. In addition, our pending acquisition of HSM Consulting, which we announced today, is not included in our second quarter financial results. Upon closing, HSM will be included within the Healthcare segment. We anticipate the transaction will close during the third quarter of 2016. We also expect the acquisition of the international business of ADI Strategies will close during the third quarter of 2016, at which time it will be included in our Business Advisory segment. Now let me walk you through some of the key financial results for the quarter. Revenues from continuing operations for the second quarter of 2016 were 184.3 million compared to 184 million in the same quarter of 2015. Revenues for the second quarter of 2016 reflect our acquisitions of Rittman Mead India, Cloud62, MyRounding and the U.S. business of ADI Strategies, all of which closed after the second quarter of 2015, and in the aggregate generated 8.7 million of incremental revenues during the quarter. Revenues were relatively flat over the prior year period due to a decline in Healthcare revenues, which were offset by increased revenues in our Education & Life Sciences, and Business Advisory segments. Net income from continuing operations increased was 16.1 million or $0.76…

Thank you. [Operator Instructions] And our first question comes from the line of Tim McHugh with William Blair & Company. Please go ahead, Tim.

First I guess, just a numbers question. So can you help us quantify I guess the annual revenue that you’ll get from the international part of ADI and from HSM I am not sure if you have it but I didn’t get it?

We didn’t Tom so in total between ADI Strategies on the U.S. piece and the acquisition of HSM, which we expect to close pretty quickly here in Q3. We expect a combined total of a roughly $35 million and that breaks out about 10 million from HSM and roughly about $25 million from ADI Strategies.

And that's an annual number or is that for this year?

That's for the balance of this year.

Okay, okay.

That's what we expect to be included in the reported numbers for 2016.

Okay. And did you give your expectations of Studer as well how did that performed in the quarter?

Yes so Studer what we said was it was in line with our expectations for the full year, and we continue to expect mid to upper single-digit growth. Sequentially, it was relatively flat but that's timing of some of the, all the activity that we recognized on a current basis.

Okay. And the comment on I guess Mark just bring you back to the market, I guess expecting flat Healthcare in the second half given it was down a fair amount sequentially on an organic basis what, I guess what's the risk for further weakness and I guess how do you gauge that relative to I guess the pipeline and everything you look at in terms of the revenue cycle piece I guess. How do you know it's not going to continue to get worse I guess from there?

Tim this is Jim. We -- it's possible we're kind of looking at probably slightly negative organic growth at the midpoint for Healthcare. So I just, that's kind of what we're thinking may be the case. I think what happens is we are looking at the pipeline as it exists right now and whether there are, our gains for the rest of the year reflects kind of what we're seeing right now and how we're seeing as Mark indicated the Studer Group continues to do well, there has been this choppiness that we're still kind of trying to manage through on the cost in clinical and revenue side piece and I think part of it just reflects the portfolio of services we have right now. When we look at the pipeline on a go forward we're trying to be cautious about predicting where things are going so that we don't end up having to worry about issues of timing and the size of projects and how quickly they are going to ramp-up so we're taking an approach that we think is reasonable given what we see right now.

So Tim just to reiterate, I think if you look at, when we think about the guidance range for the balance of the year and what's implied in the second half for organic Healthcare it's essentially a continuation of what the year-to-date trend was for the first half of the year, so a kind of low negative single-digit percentage.

Okay. And I guess just to ask the question because one of your competitors reported and had good kind of results in the Healthcare segment sale. Can you talk about competitively how do you feel about the business and is this shift forward to strategy kind of more IT in the strategy approach that you are pursuing here is it one that just others are out ahead of you or do you feel just as comfortable with I guess how you are competing for engagements that come up versus the kind of a I guess the number of opportunities that you have?

So Tim this is Jim. I guess I will make a couple of comments, first of all, I don't know we certainly have made our recent acquisitions in Healthcare it’s certainly been towards the technology end I think it’s less about our technology strategy and more about our continued efforts to use technology to help our clients better run their business. And so we still believe that there is going to be a very strong need for our traditional services, both on the cost in clinical side and the revenue cycle side. There is no question that the need believe to continue to use technology to enhance and bring those the value of those businesses to life for our clients is going to be important and that's why we've made those investments, so I just want to characterize it I don’t know that we’re totally getting to be totally IT-based it is just an it's an integral part of the way we are delivering service to our clients. And getting back to your competitive question we've -- just a couple of comments there, number one is as we've indicated recently I think certainly as we've seen the average size of our projects decline, we certainly have been in the position where that's going to open up a little bit more opportunity for some of our competitors to come in and we witnessed that we've always had good competition and if we have smaller projects we’re going to continue to get good competition, so we've expected that. I think there is a part that we've always been a little bit out of think with our competitors in terms of whether we’re up and they are down or vice versa I think that's reflective of the fact that a number of things…

Okay, thank you.

Our next question is from the line of Tobey Sommer with SunTrust. Please go ahead, Tobey.

For my first question I would like to ask in terms of the FTEs within Healthcare. Do you think those will be roughly stable in the back half of the year will that be an expectation for the revenue outlook that you laid out?

Yes, Tobey I think at this point as we have talked about before, I think our inclination is to be cautious on hiring and staffing just because of the lower level of visibility that we have within the practice. And so I would expect it to be probably at best flat maybe a little bit down from where we are right now, but again it's one of those thing that we manage kind of on a more current basis, so it’s roughly managed according to utilization and then we make the headcount where we need it to be in order to protect the margin and profitability.

And Jim you had mentioned in your prepared remarks seeing the costs associated with delivering services among your Healthcare customers being higher than the revenue and reimbursement. Is that something that you would expect to become more visible in the public hospital company results as we work our way through the year?

So, my comment was mostly about the non-public, non-core profits. We don’t serve that many for profit companies if that is what you are question is about Tobey within our performance improvement segment. So I don’t, I suspect sitting them much the same way their managed differently than a lot of our non-profit clients. I do know, I think it’s becoming increasingly prominent in our non-for profit clients that they’re seeing cost pressures on the labor side that are exceeding the reimbursement or certainly the reimbursement trends and that we know has become an increased focus of a lot of our clients, particularly in the non-for profit sector. Is that answering your question?

Sure. Yes thank you. And Mark, I need to ask you to repeat it. But you mentioned what the contribution was, you take guidance of the acquisitions, but I wasn’t able to jot it down?

Yes. No problem Tobey, it is 35 million in total the assumption is 10 million from HSM through the balance of the year. We expect to close pretty quickly on the transaction and 25 million from ADI Strategies, which is from the date that we acquire then back effective May 1st.

Okay. Thank you. And then just a short question on the Business Advisory, are you moving, I guess I don’t know upscale, but just getting some new larger projects in the bankruptcy field there?

Yes, I think we are. We’ve always kind of disturbed the middle market I think over the years, as we’ve established our reputation, I think it is eased the extent to which we can be considered for larger bankruptcies and troubled companies. And so I do think that overtime, it’s possible that we will be increasing that. I think we’re still primarily consider ourselves to be mostly middle market, but we have certainly attained the ability to service larger more complex clients Tobey.

Thank you. I’ll get back in the queue.

And our next question is from the line of Randy Reece with Avondale Partners. Please go ahead, Randy.

Good afternoon. I wanted to talk again about the labor consulting business. That does seem to be an area of increasing concern. Have you seen it actually materialize into, in your pipeline yet?

Randy, this is Jim. We have, we have there is clients with we’re working now, there is other clients that are talking with us about it. So we are, we know that it is a sizeable issue. I think part that concerns our clients the most is the trends and that is the trend seem to really be towards much tighter labor among physicians and clinicians and nurses and the reimbursement hasn’t really match those trends. I think that’s the fundamental reason that they are concerned right now.

Okay. And then when I look at your consulting headcount in Healthcare. You had a pretty considerable decline in this quarter. Could you just go over your philosophy about managing headcount versus activity levels in Healthcare? How readily you respond to changes and whether the cuts were concentrated in any particular sub-segment of Huron Healthcare?

Yes Randy, this is Mark. So really I would say, our philosophy in general on managing headcount is the same across the business, which is really in the context of trying to achieve financial projections, taking care of the clients that you have and that you expect to have with the right mix of talent within the organization. And so and if you go back a little over the years I mean I think literally every single one of our practices goes through this from time-to-time. So it's something that is just part of being in a consulting business. Within our particular business I would say no they were not concentrated in any particular area.

Okay very good, thank you.

[Operator Instructions] And your next question is from the line of Kevin Steinke with Barrington Research. Please go ahead.

Good afternoon. You mentioned a little bit of a slowdown in the revenue cycle within Healthcare, I believe you said for reasons similar to cost in clinical, but I don't know if there is any more color you could add to that or any more commentary just on the slowdown in revenue cycle?

Hi Kevin this is Jim. I don't think there is much more I mean this is really the first time we've had kind of a slightly more recognizable slowdown and we're reluctant to be too presumptive about the trends one way or the other with really one quarter that seems to be different from the way it's been before. So, it was a little bit clear when we've talked over the last three-four quarters about some of the changes that we had and what you used to call performance improvement and is now a cost in clinical where it has been a little bit more pronounced that we understand and we've been kind of accommodating that and talking about it. I think here, we just it was really a first time that I think -- it was that it was as noticeable as it was. We don't think that this is necessarily indicative of any trend going on, but it was certainly a component of the drop-off in revenue for this current quarter. I don't know that there is enough, we try to leave the tea leaves just like everybody else does about the opportunities from revenue cycle. There is certainly there seem to be plenty of demand in the marketplace. So, we're just kind of calling it as we see it right now and being cautious about the remainder of the year until we get a little bit more clarity in terms of where things are going.

Okay, okay. Fair enough. And I believe you were making some investments this year in both Healthcare and Education & Life Sciences. So, how are those tracking relative to your expectations in terms of costs and also may be any initial results from those investments?

Kevin thanks for that question. I think let me start on the Healthcare side, so we have invested in a strategy solution and I think we're starting to see the kinds of results that we're hoping to see I mean again I think the investment has been in line with what our expectations are. So I think it hasn’t been a part of the story line here in terms of any of our financial results. And really I would say in general everybody is here but I think on the cloud we've been very pleased with the results that we've seen I would say that if you look collectively at where we are on a year-to-date basis we're spending marginally a little bit less than we expected. We had talked about in guidance at the beginning of the year roughly 250 basis points I think we're probably close to roughly 200 basis points but our intention is to continue to invest aggressively because we see lots of good top-line opportunities with all of our cloud vendor partners. Jim anything you would like to add to that.

Yes, just a couple of points on both of them on that just in terms going back to Healthcare for a second. On the strategy component of it, we have made business and impart we do know that our clients are kind of looking for the strategy work to increasingly to be aligned with capabilities around cost and revenue and so that's another part that we are or the reason we're expanding our strategy thing as it's a great standalone part of our business but it also is increasingly requested by our clients to be attached to either cost and/or revenue solutions as well and so we feel really good about the kind of the way that that product is being collaborative as we go-to-market. And I think as Mark indicated on the higher education side and the cloud investment in particular, it really is going better than we thought both on the revenue side and the cost side, which is nice but I think probably more importantly, I think we are we're really getting because of our competencies and knowledge in that higher education space, we are really seeing a lot of opportunities that are opening up that we think we are going to be very competitive in simply because of our deep knowledge not only increasing knowledge of the cloud based solutions, but also our deep and long knowledge of the environment in the higher education space. So you out those together where a lot of clients want to use the opportunity to move to the cloud to change the way they do business, and we’re really well prepared to do that. So we have high hopes and expectations for this project and for this part of the practice as it continues to grow.

Okay, that's good to hear. In terms of the targeted savings from this reduction and some overhead cost related to the legal business, are you still on-track with what you were planning for this year?

Kevin. Our expectations haven’t really changed from the beginning of the year and we started in some of those service has started to roll off at the end of the first quarter and into the second quarter. We've certainly seen savings and at the same time we have had some investments that are really again built into our expectations things like we talked about the brand, as well as some of the deal related costs from both the ADI and the HSM transactions that are been happening, so collectively I think we're comfortable with where we are from a cost perspective with respect to those expectations.

All right, good. One last question just in terms of the 2016 EBITDA guidance as I calculated or actually adjusted EBITDA guidance as I calculated it implies an adjusted EBITDA margin 20 basis points lower at the midpoint than your prior annual revenue and adjusted EBITDA guidance, so it's pretty small change but I don’t know if there is anything particular behind what's baked in terms of the adjusted EBITDA margin?

It is again, I'm glad you brought that up because it really is primarily reflective of the two acquisitions that we've done which are more implementation businesses with lower EBITDA margins and so when you blend those down on that revenue, including it’s really more of a mix issue so if you strip those out we would be essentially in line with what our original guidance range was.

Okay, perfect. That makes sense. Thanks for taking my questions.

And Mr. Roth I'm not showing any further questions. I would like to turn the conference back over to you.

Thank you all for spending time with us this afternoon. We look forward to speaking with you again when we announce our third quarter results. Have a nice evening.