What happened
Shares of Franklin Covey (FC -0.58%) were climbing after the consulting firm posted better-than-expected results in its first-quarter earnings call.
The stock was up 10.85% at the closing bell.
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So what
Sales jumped 27% in the first quarter to $61.3 million, which trounced expectations at $55.4 million. The company benefited from sales of its subscription service, All Access Pass, which were up 27%, with revenue from its education division up 56% thanks to strength in its Leader in Me coaching subscription.
Profitability also improved, with gross margin up 240 basis points to 77.7%, and adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) rose 167% to $9.9 million. On the bottom line, the company posted a per-share profit of $0.27, up from a per-share loss of $0.06 in the quarter a year ago. That also crushed the analyst consensus at $0.03.
CEO Paul Walker said, "We are very pleased with our very strong first-quarter results," adding, "The ongoing strength of our subscription business was reflected in every income category, including sales, deferred sales (billed and unbilled), gross profit, adjusted EBITDA , and net income."
Now what
Looking ahead, investors were also happy with the company's guidance, as it forecast full-year adjusted EBITDA of $34 million to $36 million, representing 25% growth from a year ago. Given the momentum coming out of the first quarter, that guidance could prove to be conservative.
