Blaming volatility in the stock markets and in the price of its own shares, FTI Consulting Inc. said yesterday that it is deferring an equity offering expected to raise about $74 million until the first quarter of next year.
The Annapolis-based company, which offers bankruptcy, financial restructuring and litigation-related consulting services, had planned to complete the offering of 2.1 million shares between Thanksgiving and Christmas, a company official said yesterday.
FTI, which counts bankrupt WorldCom Inc. among its clients, planned to use funds raised from the offering to repay $73.9 million in borrowings for its $243.2 million purchase of PricewaterhouseCoopers' Business Recovery Services division in late August.
"It's very difficult to correlate [stock market] reactions with our public statements because of all the news that's been announced" in recent months, said Theodore I. Pincus, FTI's chief financial officer and executive vice president.
Over the past six months, FTI's stock has traded between a low of $29.01 on July 23 and a high of $42.88 on Nov. 1. Yesterday, FTI shares, which trade on the New York Stock Exchange, rose $1.27 to close at $38.25.
As of Sept. 30, the company's total debt stood at $138.9 million and its cash totaled $3.6 million, according to an amendment to its registration statement filed last week with the Securities and Exchange Commission.
Though adding significantly to its debt, FTI's purchase of the former Price- waterhouseCoopers division boosted its profile, adding 371 employees to its existing 600 and expanding its presence nationwide in several large cities.
FTI's acquisition also has shown immediate results on its bottom line.
Last month, FTI reported record third-quarter results, which included one month of results from the Business Recovery Services division, posting net income of $8.3 million compared with $2.3 million in the year-earlier period - a 260.8 percent increase.
FTI also is continuing with plans to sell its Applied Sciences division, a small division that investigates accidents for corporate clients, and proceeds from that sale will be used to pay down the Business Recovery Services-related debt.
FTI expects to complete that sale before July next year, according to last week's filing.