The Hackett Group, Inc.

Welcome to the Hackett Group first quarter earnings conference call. Your lines have been placed on a listen-only mode until the question and answer session. Please be advised the conference is being recorded. Hosting tonight's call are Mr. Ted Fernandez, Chairman and CEO, and Mr. Bob Ramirez, Chief Financial Officer. Mr. Ramirez, you may begin.

Good afternoon, everyone, and thank you for joining us to discuss the Hackett Group's first quarter results. Speaking on the call today and here to answer your questions are Ted Fernandez, Chairman and CEO of the Hackett Group, and myself, Rob Ramirez, CFO. A press announcement was released over the wires at 4.05 p.m. Eastern Time. For a copy of the release, please visit our website at www.thehackettgroup.com. We will also place any additional financial or statistical data discussed on this call that is not contained in the release on the investor relations page of our website. Before we begin, I would like to remind you that in the following comments and in the question and answer session, we will be making statements about expected future results, which may be forward-looking statements for the purposes of the federal securities laws. These statements relate to our current expectations, estimates, and projections and are not a guarantee of future performance. They involve risks, uncertainties, and assumptions that are difficult to predict and which may not be accurate, especially in light of COVID-19. Actual results may vary. These forward-looking statements should be considered only in conjunction with the detailed information, particularly the risk factors contained in our SEC filings. At this point, I would like to turn it over to Ted.

Thank you, Rob, and welcome everyone to our first quarter earnings call. As we normally do, I'll open the call with some overview comments on the quarter, turn it back over to Rob to comment on detailed operating results, cash flow, and also comment on outlook. We will then review our market strategy-related comments and then move on to Q&A. Please allow me to start the call by acknowledging the incredible bravery and commitment of our healthcare providers, first responders, and those dedicated individuals who have continued to work nonstop and under very dangerous circumstances to support all of us during this tragic pandemic. We eagerly wait for the conditions to exist where all of us around the globe are able to return to our normal lives, however that is ultimately defined. I would also like to acknowledge our associates and clients that quickly and successfully adapted to the remote delivery requirements around the globe. In spite of the limited notice and varying circumstances, I commend their dedication and commitment to their respective client initiatives in allowing substantially all of our engagements to continue. Now on to operating results. This afternoon, we reported net revenues of $65.2 million in pro forma earnings and David Dungan. Not only did our Oracle cloud growth clearly outstrip their year-on-year revenue decline from our legacy Oracle on-premise business, but we also saw very strong growth from our SAP and OneStream groups. Overall, Q1 U.S. revenues were up 11%, with EEA up 20%. More impressive is that the Oracle ERP revenues are expected to be up sequentially from Q1 to Q2 in spite of the current environment. Our strategy and business transformation activity continued to be solid around digital transformation initiatives. However, this group was the group which most quickly felt the impact of the pandemic in March, as some expected sales decisions were deferred. On the international front, Europe continued to be challenging. It is a shame that as the UK January election results started to provide the clarity needed to allow business demand to return, We see some of the same decision delays emerge but now due to the pandemic. On the investment side, we strongly believe that the strategic investments we have made to fully digitize all of our IP The development of our two next-generation platforms, Quantum Leap, our state-of-the-art global leading benchmark platform, and our proprietary Hackett Digital Transformation Platform, or DTP, are highly differentiating our offerings and will be important drivers of our growth for many years to come. Additionally, our investments with rapidly growing e-procurement, EPM, and RPA software providers also continue to be key to our strategy and digital transformation momentum and are also important future drivers of our growth. On the balance sheet side, our ability to be highly profitable and generate strong cash flow for operation has allowed us to increase our dividend buyback stock fund acquisitions while continuing to invest in our business. I cannot tell you how important it was to start the year and finish the first quarter with a solid cash position and no outstanding debt which provides us the ability to manage our future during this volatile economic period. Before I turn it over to Rob to provide our detailed operating results and more perspective on the second quarter, I would like to share some of the operating guidelines that we are using to manage our second quarter. We started the year by aggressively adding associates and strategic hires consistent with our 2020 growth prospects. As we started to feel the effects of the pandemic in early to mid-March and knowing we were entering the period with a strong cash position, we quickly decided to make the safety and well-being of our associates our top priority That meant not only making sure that they were taking all necessary safety precautions to ensure their safety, but to avoid any layoffs directly resulting from the pandemic, at least through the end of our second quarter. We believe this would provide our associates with very important peace of mind to weather the storm while we gain critical market information from which to make any further decisions. on our first weekly coronavirus global update call on March 20th. We shared our commitment with our associates and we communicated that we were prepared to forego profitability in the second quarter as long as we did not weaken our solid cash position and without needing to use our credit facility. We also informed our associates that we would update our employee-related decisions as we better understood the impact of the disruption on our client decision-making and on existing and proposed initiatives and address any required changes prior to the beginning of the third quarter. With that said, let me ask Rob to provide details on our operating results, cash flow, and also comment on outlook. I will make additional comments on strategy and market conditions following Rob's comments.