Franklin Covey Co. (NYSE:FC) Q4 2019 Earnings Conference Call - Final Transcript

Nov 07, 2019 • 05:00 pm ET

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Franklin Covey Co. (NYSE:FC) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Welcome to the Q4 2019 Franklin Covey Earnings Conference Call. My name is Adrian and I will be your operator for today's call. [Operator Instructions] Please note this conference is being recorded. I'll now turn the call over to Corporate Controller, Derek Hatch. Derek Hatch, you may begin.

Executive
Derek Hatch

Thank you, Adrian. Good afternoon, everyone. On behalf of Franklin Covey I would like to welcome you to our investor call for the fourth quarter and fiscal year ended August 31 2019.

Before we begin, I'd like to remind everyone that this presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements are based upon management's current expectations and they are subject to various risks and uncertainties, including but not limited to the ability of the company to stabilize and grow revenues; the acceptance of and renewal rates for the All Access Pass; the ability of the company to hire productive sales professionals; general economic conditions; competition in the Company's targeted marketplace; market acceptance of new products or services and marketing strategies; changes in the Company's market share; changes in the size of the overall market for the Company's products. Changes in the training and spending policies of the Company's clients; and other factors identified and discussed in the Company's most recent annual report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission. Many of these conditions are beyond our control or influence, any one of which may cause future results to differ materially from the Company's current expectations. And there can be no assurance the Company's actual future performance will meet management's expectations.

These forward-looking statements are based on management's current expectations and we undertake no obligation to update or revise these forward-looking statements to reflect events or circumstances after the date of today's presentation except as required by law.

With that out of the way, I'd like to turn the time over to Mr. Bob Whitman, our Chairman and Chief Executive Officer. Bob?

Executive
Robert A. Whitman

Thanks so much, Derek. Good afternoon, everyone. We really appreciate you joining today. We're really pleased to report that our Q4 and full fiscal year 2019 results were strong -- really, very strong and even better than expected. We have strong momentum in our business, and we fully expect to build on that momentum going forward. The results for the fourth quarter and for the year are really what we expected when we made the business model change several years ago, high-single-digit revenue growth in constant currency; high gross margins; high revenue retention; SG&A that would reduce for high flow-through; and really accelerated growth in adjusted EBITDA and cash flow.

As you know, our goal and expectation is to consistently achieve these very high rates of growth in adjusted EBITDA and cash flow and to do it for years to come. Consistent with this objective, we had very high expectations for growth and adjusted EBITDA and cash flow in fiscal '19, specifically as you can