Exponent Reports Second Quarter 2012 Results

Exponent Reports Second Quarter 2012 Results

MENLO PARK, Calif., July 18, 2012 (GLOBE NEWSWIRE) -- Exponent, Inc.
(Nasdaq:EXPO) today reported financial results for the second quarter and six
months ended June 29, 2012.

For the second quarter of 2012, total revenues increased 14% to $74,484,000,
as compared to $65,106,000 in the same period one year ago. Revenues before
reimbursements increased 13% to $68,318,000, as compared to $60,573,000 in the
second quarter of 2011.

Net income for the quarter increased 26% to $10,327,000, or $0.72 per diluted
share, as compared to $8,217,000, or $0.55 per diluted share, reported in the
same quarter a year ago. EBITDA^1 improved 22% to $18,342,000, as compared to
$14,987,000 in the second quarter last year.

For the first half of 2012, total revenues increased 6% to $146,409,000, as
compared to $138,579,000 in the same period of last year. Revenues before
reimbursements increased 8% to $134,788,000, as compared to $124,756,000, in
the same period of 2011. 

Net income for the first half of 2012 increased 14% to $18,528,000, or $1.29
per diluted share, as compared to $16,220,000, or $1.08 per diluted share,
reported in the prior year period.  EBITDA^1 in the first half of 2012
improved 13% to $33,142,000, as compared to $29,409,000, in the first half of
2011.

During the second quarter of 2012, Exponent repurchased $14.4 million of its
common stock, and closed the quarter with $109.0 million in cash, cash
equivalents and short-term investments.

"We are pleased with our second quarter performance having produced
double-digit revenue growth and increased profitability," commented Dr. Paul
Johnston, President and CEO. "We continued to benefit from strong demand
across a broad range of our services, both proactive and reactive. We
experienced high utilization as we continued to benefit from new work in key
areas as well as a few major projects. In our environmental and health segment
we had notable contributions from our environmental sciences, ecological
sciences, chemical registration and food safety, and exposure assessment
practices. In our engineering and other scientific segment we had notable
performances from our mechanics and materials, electrical, biomedical,
vehicle, and engineering management consulting practices. In addition, our
defense technology development business saw an increase in activity supporting
the U.S. Army's Rapid Equipping Force which was offset by the winding down of
our current U.S. ground penetrating radar development contract.

"For the full year 2012, we are increasing our outlook for growth in revenue
before reimbursements to be in the mid-single digits and expect full year
EBITDA^1 margin to be approximately flat over the prior year. This outlook
reflects the strong utilization during the first half of the year, our
expectation that a few major projects will step down in their level of
activity in the next several quarters, and lower defense technology
development product sales as compared to the prior year.  We are pleased with
our performance to date and are optimistic about our ability to weather a
difficult economic environment as our project work, both in the U.S. and
internationally, are in areas that we believe are less sensitive to the
economic slowdown. We look forward to further translating our unique
scientific and engineering capabilities into additional shareholder value over
time," concluded Dr. Johnston.

Today's Conference Call Information

Exponent will discuss its financial results in more detail on a conference
call today, July 18, 2012, starting at 4:30 p.m. Eastern Time/1:30 p.m.
Pacific Time. The audio on the conference call is available by dialing
877-941-2068 or 480-629-9712. A live webcast of the call will be available on
the Investor Relations section of the Company's website at
www.exponent.com/investors. For those unable to listen to the live webcast, a
replay of the call will also be available on the Exponent web site, or by
dialing 800-406-7325 or 303-590-3030, and entering reservation 4551395#.

About Exponent

Exponent is an engineering and scientific consulting firm providing solutions
to complex problems. Exponent's multidisciplinary organization of scientists,
physicians, engineers, and business consultants brings together more than 90
technical disciplines to address complicated issues facing industry and
government today. The firm has been best known for analyzing accidents and
failures to determine their causes, but in recent years it has become more
active in assisting clients with human health, environmental and engineering
issues associated with new products to help prevent problems in the future.

Exponent may be reached at (888) 656-EXPO, info@exponent.com, or
www.exponent.com.

This news release contains, and incorporates by reference, certain
"forward-looking" statements (as such term is defined in the Private
Securities Litigation Reform Act of 1995, and the rules promulgated pursuant
to the Securities Act of 1933, as amended, and the Securities Exchange Act of
1934, as amended thereto under) that are based on the beliefs of the Company's
management, as well as assumptions made by and information currently available
to the Company's management. Such forward-looking statements are subject to
the safe harbor created by the Private Securities Litigation Reform Act of
1995. When used in this document and in the documents incorporated herein by
reference, the words "anticipate," "believe," "estimate," "expect" and similar
expressions, as they relate to the Company or its management, identify such
forward-looking statements. Such statements reflect the current views of the
Company or its management with respect to future events and are subject to
certain risks, uncertainties and assumptions. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, the Company's actual results, performance, or achievements could
differ materially from those expressed in, or implied by, any such
forward-looking statements. Factors that could cause or contribute to such
material differences include the possibility that the demand for our services
may decline as a result of changes in general and industry specific economic
conditions, the timing of engagements for our services, the effects of
competitive services and pricing, the absence of backlog related to our
business, our ability to attract and retain key employees, the effect of tort
reform and government regulation on our business, and liabilities resulting
from claims made against us. Additional risks and uncertainties are discussed
in our Annual Report on Form 10-K under the heading "Risk Factors" and
elsewhere in the report. The inclusion of such forward-looking information
should not be regarded as a representation by the Company or any other person
that the future events, plans, or expectations contemplated by the Company
will be achieved. The Company undertakes no obligation to release publicly any
updates or revisions to any such forward-looking statements.

^1 EBITDA is a non-GAAP financial measure defined by the Company as net income
before income taxes, interest income, depreciation and amortization. EBITDAS
is a non-GAAP financial measure defined by the Company as EBITDA before
stock-based compensation. The Company regards EBITDA and EBITDAS as useful
measures of operating performance and cash flow to complement operating
income, net income and other GAAP financial performance measures.
Additionally, management believes that EBITDA and EBITDAS provide meaningful
comparisons of past, present and future operating results. Generally, a
non-GAAP financial measure is a numerical measure of a company's performance,
financial position or cash flow that either excludes or includes amounts that
are not normally excluded or included in the most directly comparable measure
calculated and presented in accordance with GAAP. These measures, however,
should be considered in addition to, and not as a substitute or superior to,
operating income, cash flows, or other measures of financial performance
prepared in accordance with GAAP. A reconciliation of the measures to GAAP is
set forth below.

EXPONENT, INC. 
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the Quarters Ended June 29, 2012 and July 1, 2011
(unaudited)
(in thousands, except per share data)
                                                                     
                                      Quarter Ended       Six Months Ended 
                                      June 29, July 1,   June 29,   July 1, 
                                     2012      2011      2012       2011 
                                                                     
Revenues                                                             
Revenues before reimbursements        $ 68,318  $ 60,573  $ 134,788  $ 124,756
Reimbursements                        6,166     4,533     11,621     13,823
                                                                     
Revenues                              74,484    65,106    146,409    138,579
                                                                     
Operating expenses                                                   
Compensation and related expenses     41,857    38,508    88,032     81,208
Other operating expenses              5,952     5,704     11,514     11,486
Reimbursable expenses                 6,166     4,533     11,621     13,823
General and administrative expenses   3,148     2,984     6,065      6,319
                                                                     
                                      57,123    51,729    117,232    112,836
                                                                     
Operating income                      17,361    13,377    29,177     25,743
                                                                     
Other income                                                         
Interest income, net                  88        41        165        62
Miscellaneous income (expense), net   (201)     542       1,639      1,534
                                      (113)     583       1,804      1,596
                                                                     
Income before income taxes            17,248    13,960    30,981     27,339
                                                                     
Income taxes                          6,921     5,743     12,453     11,119
                                                                     
Net income                            $ 10,327  $ 8,217   $ 18,528   $ 16,220
                                                                     
Net income per share:                                                
Basic                                 $ 0.75    $ 0.57    $ 1.34     $ 1.12
Diluted                               $ 0.72    $ 0.55    $ 1.29     $ 1.08
                                                                     
Shares used in per share                                             
computations:
Basic                                 13,835    14,402    13,847     14,467
Diluted                               14,316    14,971    14,373     15,062

 
EXPONENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
June 29, 2012 and December 30, 2011
(unaudited)
(in thousands)
                                                                
                                                    June 29,    December 30, 
                                                    2012       2011 
Assets                                                          
Current assets:                                                 
Cash and cash equivalents                            $ 84,441   $ 84,439
Short-term investments                               24,587     25,260
Accounts receivable, net                             78,862     73,065
Prepaid expenses and other assets                    6,068      8,521
Deferred income taxes                                8,211      7,293
Total current assets                                 202,169    198,578
Property, equipment and leasehold improvements, net  26,831     27,215
Goodwill                                             8,607      8,607
Other assets                                         39,009     34,388
                                                     $ 276,616  $ 268,788
                                                                
Liabilities and Stockholders' Equity                            
Current liabilities:                                            
Accounts payable and accrued liabilities             $ 9,046    $ 6,738
Accrued payroll and employee benefits                40,875     48,089
Deferred revenues                                    4,820      5,948
Total current liabilities                            54,741     60,775
Other liabilities                                    23,540     19,456
Deferred rent                                        1,634      1,842
Total liabilities                                    79,915     82,073
                                                                
Stockholders' equity:                                           
Common stock                                         16         16
Additional paid-in capital                           120,031    108,071
Accumulated other comprehensive loss                 (538)      (471)
Retained earnings                                    188,831    179,432
Treasury stock, at cost                              (111,639)  (100,333)
Total stockholders' equity                           196,701    186,715
                                                     $ 276,616  $ 268,788

 
EXPONENT, INC. 
EBITDA and EBITDAS (1) 
For the Quarters Ended June 29, 2012 and July 1, 2011
(unaudited)
(in thousands)
                                                                  
                      Quarter Ended                Six Months Ended 
                     June 29,       July 1,       June 29,       July 1, 
                     2012           2011          2012           2011 
                                                                  
Net Income            $ 10,327       $ 8,217       $ 18,528       $ 16,220
                                                                  
Add back (subtract):                                              
                                                                  
Income taxes          6,921          5,743         12,453         11,119
Interest income, net  (88)           (41)          (165)          (62)
Depreciation and      1,182          1,068         2,326          2,132
amortization
                                                                  
EBITDA (1)            18,342         14,987        33,142         29,409
                                                                  
Stock-based           2,727          2,119         7,184          5,934
compensation
                                                                  
EBITDAS (1)           $ 21,069       $ 17,106      $ 40,326       $ 35,343
                                                                  
                                                                  
(1) EBITDA is a non-GAAP financial measure defined by the Company as net
income before income taxes, interest income, depreciation and
amortization. EBITDAS is a non-GAAP financial measure defined by the Company
as EBITDA before stock-based compensation. The Company regards EBITDA and
EBITDAS as useful measures of operating performance and cash flow to
compliment operating income, net income and other GAAP financial performance
measures. Additionally, management believes that EBITDA and EBITDAS provide
meaningful comparisons of past, present and future operating
results. Generally, a non-GAAP financial measure is a numerical measure of a
company's performance, financial position or cash flow that either excludes or
includes amounts that are not normally excluded or included in the most
directly comparable measure calculated and presented in accordance with
GAAP. These measures, however, should be considered in addition to, and not as
a substitute or superior to, operating income, cash flows, or other measures
of financial performance prepared in accordance with GAAP.

CONTACT: Exponent, Inc.
         (888) 656-EXPO
         info@exponent.com
         www.exponent.com