On June 26, 2024, Franklin Covey Co (FC, Financial) released its 8-K filing reporting robust financial results for the third quarter of fiscal 2024. The company, a global leader in organizational performance improvement, focuses on providing time management and effectiveness training for individuals and corporations through various delivery methods.
Third Quarter Performance
Franklin Covey Co (FC, Financial) reported consolidated revenue of $73.4 million for the quarter ended May 31, 2024, a 3% increase from $71.4 million in the same period last year. This figure surpassed the analyst estimate of $72.12 million. Net income for the quarter rose by 25% to $5.7 million, or $0.43 per diluted share, compared to $4.6 million, or $0.32 per diluted share, in the prior year. This also exceeded the estimated earnings per share of $0.39.
Financial Achievements and Metrics
The company's Adjusted EBITDA increased by 17% to $13.9 million, compared to $11.9 million in the third quarter of fiscal 2023. Cash flows from operating activities surged to $38.4 million, up from $25.9 million in the first three quarters of fiscal 2023, while free cash flow doubled to $30.6 million from $15.6 million in the same period last year. Liquidity remained strong at nearly $100 million, with $36.6 million in cash and no drawdowns on the company’s $62.5 million credit facility.
Income Statement Highlights
| Metric | Q3 FY2024 | Q3 FY2023 |
|---|---|---|
| Revenue | $73.4 million | $71.4 million |
| Net Income | $5.7 million | $4.6 million |
| Adjusted EBITDA | $13.9 million | $11.9 million |
Balance Sheet and Cash Flow
Franklin Covey Co (FC, Financial) reported total assets of $220.97 million as of May 31, 2024, compared to $245.92 million as of August 31, 2023. The company’s total liabilities stood at $148.81 million, down from $167.27 million at the end of the previous fiscal year. Shareholders' equity was $72.16 million, compared to $78.65 million as of August 31, 2023.
CEO Commentary
"We are pleased with our results in the third quarter, where revenue, Adjusted EBITDA, and cash flows were all stronger than expected. We were further encouraged by the strengthening of several key indicators during the quarter and believe that these trends will lead to improved results in future periods," said Paul Walker, President and Chief Executive Officer.
Fiscal 2024 Guidance
Despite challenges faced in the first half of fiscal 2024, Franklin Covey Co (FC, Financial) reaffirmed its guidance for the fiscal year. The company expects Adjusted EBITDA to be at the low end of its previously announced range of $54.5 million to $58.0 million, representing a 13% growth over fiscal 2023. The company remains confident in the strength of its subscription offerings, which have driven growth in recent years.
New Share Purchase Program
On April 18, 2024, the company’s Board of Directors approved a new plan to purchase up to $50.0 million of its outstanding common stock. The new plan does not have an expiration date and will be executed at the company’s discretion based on market conditions and other factors.
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Explore the complete 8-K earnings release (here) from Franklin Covey Co for further details.
