Charles River Associates Announces Second-Quarter Fiscal 2002 Financial Results.

Business/Technology Editors

BOSTON--(BUSINESS WIRE)--June 4, 2002

Charles River Associates Incorporated (CRA) (Nasdaq: CRAI), a leading provider of economic, financial, and business strategy consulting, today reported financial results for its fiscal 2002 second quarter ended May 10, 2002.

Revenues for the second quarter of fiscal 2002 increased 14.0 percent to $28.0 million, compared with revenues of $24.6 million for the second quarter of fiscal 2001. Net income for the second quarter of fiscal 2002 was $2.0 million, or $0.22 per share on a diluted basis, compared with net income of $1.7 million, or $0.19 per share on a diluted basis, for the second quarter of fiscal 2001. Second-quarter revenue and net income figures for fiscal 2002 include the results of the North American operations of Arthur D. Little's Chemical & Energy practice from the effective date of the acquisition on April 29, 2002.

Revenues for the first two quarters of fiscal 2002 increased 14.2 percent to $52.2 million from $45.7 million in the same period in the previous year. Net income for the first two quarters of fiscal 2002 was $3.6 million, or $0.38 per share on a diluted basis, compared with net income of $3.1 million, or $0.34 per share on a diluted basis, for the first two quarters of fiscal 2001.

Comments on the Second Quarter

"CRA's performance in the second quarter reflects strong contributions from a number of our business consulting practice areas, particularly Finance, as well as Aerospace & Defense, Transportation, and from several international offices," said James C. Burrows, CRA's president and CEO. "Utilization improved from the sequential first quarter, and we continued to control our operating costs. As a result, we achieved solid top- and bottom-line results."

"A highlight of CRA's second quarter was the acquisition of the North American and U.K. operations of Arthur D. Little's Chemical & Energy practice, which was finalized on May 10, 2002," said Burrows. "Adding the ADL practice has expanded our staff of chemicals and petroleum industry consultants and our client base in this key practice area. In addition, the acquisition doubles the size of our London office and provides us with exposure to additional European markets, where currently the ADL practice has several projects underway. As a result of the acquisition, CRA now offers one of the most comprehensive consulting services available to the global chemical and petroleum industries."

"As we enter the third quarter, we feel positive about the overall business prospects in that we will recognize the full benefit of the ADL Chemical & Energy practice in the quarter," said Burrows. "We expect that this, along with the proactive steps we are taking to improve utilization and margins, should enable CRA to continue to perform well in the third quarter."

To listen to a live audio Webcast of CRA's second-quarter fiscal 2002 financial results conference call, visit the Company's Web page at www.crai.com. The conference call begins at 10:00 a.m. ET today.

About CRA

Founded in 1965, CRA, an economics, finance, and business consulting firm, works with businesses, law firms, accounting firms, and governments in providing a wide range of services. CRA combines economic and financial analysis with expertise in litigation and regulatory support, business strategy and planning, market and demand forecasting, policy analysis, and engineering and technology management. In thousands of engagements, CRA has distinguished itself by its corporate philosophy of providing responsive, high-quality consulting; an interdisciplinary team approach; advanced economic, financial, and other analytic skills; and pragmatic business insights. In addition to its corporate headquarters in Boston and international offices in London, Melbourne, Mexico City, Toronto, and Wellington, CRA also has U.S. offices in Berkeley/Oakland, College Station and Houston Texas, Los Angeles, Palo Alto, Philadelphia, Salt Lake City, and Washington, D.C. More information about CRA can be found on its Web site at www.crai.com.

Statements in this press release concerning the future business, operating results, and financial condition of CRA and statements using the terms "anticipates," "believes," "expects," "should," or similar expressions, are "forward-looking" statements as defined in the Private Securities Litigation Reform Act of 1995. Such statements are based upon management's current expectations and are subject to a number of factors and uncertainties. Information contained in these forward-looking statements is inherently uncertain and actual performance and results may differ materially due to many important factors. Such factors that could cause actual results to differ materially from any forward-looking statements made by CRA include, among others, dependence on key personnel, attracting and retaining qualified consultants, dependence on outside experts, utilization rates, risks inherent in international operations, NeuCo's performance, management of new offices, dependence on growth of CRA's business consulting practice, the ability of CRA to successfully integrate new consultants into its practice, intense competition, and professional liability. Further information on these and other potential factors that could affect CRA's financial results is included in CRA's filings with the Securities and Exchange Commission. CRA cannot guarantee any future results, levels of activity, performance or achievement. CRA undertakes no obligation to update any of its forward-looking statements after the date of this press release.

                 CHARLES RIVER ASSOCIATES INCORPORATED
                   CONSOLIDATED STATEMENTS OF INCOME
                            (In thousands)

                           Twelve Weeks Ended  Twenty-four Weeks Ended
                           May 11,     May 10,     May 11,     May 10,
                            2001        2002        2001        2002


Revenues                  $24,567     $28,016     $45,711     $52,218
Costs of services          14,660      17,266      27,191      31,943
Gross profit                9,907      10,750      18,520      20,275

Selling, general and
 administrative             7,318       8,148      13,898      15,060
Income from operations      2,589       2,602       4,622       5,215

Interest income, net          276         109         615         217
Income before provision
 for income taxes
  and minority interest     2,865       2,711       5,237       5,432
Provision for income taxes (1,128)     (1,052)     (2,210)     (2,181)
Income before minority
 interest                   1,737       1,659       3,027       3,251
Minority interest             (33)        344          90         316
Net income                 $1,704      $2,003      $3,117      $3,567
Net income per share:
  Basic                     $0.19       $0.22       $0.34       $0.39
  Diluted                   $0.19       $0.22       $0.34       $0.38

Weighted average number of
 shares outstanding:
  Basic                     9,108       9,043       9,106       9,046
  Diluted                   9,118       9,249       9,111       9,301


                CHARLES RIVER ASSOCIATES INCORPORATED
                      CONSOLIDATED BALANCE SHEETS
                            (In thousands)


                                                  November 24, May 10,
                                                      2001      2002

Assets
Cash, cash equivalents and short-term investments   $23,628   $12,917
Accounts receivable and unbilled, net                37,265    38,590
Other current assets                                  2,286     2,718
    Total current assets                             63,179    54,225

Property and equipment, net                           7,569     8,396
Goodwill and intangible assets, net                  18,966    27,566
Long-term investments                                 3,433     4,438
Other assets                                          3,743     3,775
Total assets                                        $96,890   $98,400

Liabilities and stockholders' equity
Current liabilities                                 $22,070   $20,774
Long-term liabilities                                 4,818     4,084
    Total liabilities                                26,888    24,858

Total stockholders' equity                           70,002    73,542
Total liabilities and stockholders' equity          $96,890   $98,400