Large small cap virtual conference. Now, our next presenting company is Charles River Associates, the ticker CRAI. Joining us today is Paul Maleh, Chairman and CEO, and Chad Holmes, Chief Corporate Development Officer. Now, before we begin, just a quick reminder, we will have time for Q&A at the end of prepared remarks. If you would like to submit a question, just click on the Q&A button at the bottom of your screen. There is no need to wait for the end of those prepared remarks. You can submit questions at any point during our time together. With that, we can turn the call over to Charles River Associates. Good morning, gentlemen.
Hey, good morning, Mark, and good morning, everyone. Thank you for joining us today. I have a deck I'm hoping to get through in about 15-20 minutes. Hopefully, you will find it interesting, but even more so, hopefully, you'll have some questions for me. That's the part of the presentation in which I learn something too. If both those things go really poorly, we can start filling out my March bracket, which I have until about end of day today to submit. Be prepared for either one. CRA is a consulting company. We are celebrating our 60th year in 2025. The core mission of the firm that launched CRA back in 1965 still exists today, which is to bring academic quality research to the business world to help leaders make more informed decisions. Our services span across two main lines of business.
One we call legal regulatory, which makes up roughly 80% of the firm's revenue, and management consulting, which a lot of you are probably more familiar with, which make up about the remaining 20% of CRA's revenue. As with any consulting company, particularly CRA, our success starts and ends with our people. I have a really amazing group of colleagues at CRA, and their credentials, their training is really, really quite remarkable. About 40% of my senior colleagues have PhDs, the majority of them in economics on that. CRA is very selective in the hiring we let into our organization, as you can see with the middle box, middle upper box, that we accept less than 2% of our campus applicants. One of the statistics I'm even more proud of is our retention rate is really rather strong across the ranks of the organization.
When I talk about these two lines of business, legal and regulatory management consulting, probably the easiest thing for me to do is let you know what makes up the management consulting piece, and that is auctions and competitive bidding, energy, life sciences, and Marakon. Those four practices together make up roughly 20% of the management consulting revenue, life sciences being the largest of those practice areas. On the legal regulatory side, our foundation is set by the antitrust and competition practice, which makes up roughly 40-45% of the entire firm's revenue. A much larger share of the line of business revenue, but still a very prominent share of the total firm's revenue. I'll try to give some examples of the kinds of services we do a little later in the presentation.
A lot of people have never heard of CRA, but the one thing I'm pretty sure is that a lot of people have heard about our clients, both the ultimate clients who hire CRA for assistance and the intermediaries being the law firms who hire us on behalf of these clients. These are a set of logos or sampling of logos of our ultimate clients over the past two years. As you can see from the title, CRA has worked on behalf of 85 of the Fortune 100 companies, and that is just in the past two years. Even though I don't have annuity-based contracts across our services, our clients are large repeat players in the marketplace and large repeat buyers of CRA services.
The share of our market is even more impressive when you look at the law firms that hire CRA to assist in these Fortune 100 companies, where just in the past two years, again, CRA has worked for 98 of the AmLaw 100 law firms. We don't take these kinds of penetration lightly. We work hard to provide value to all our clients across all of the services that the firm provides. With these services and these kinds of clients serving as our foundation, the financial results are a byproduct. What I'm proud of here, you just see the financial results for 2024 and then the financial results over the previous five years.
If I were to show you the financial results in the previous 10 years, you're going to see the same kind of pattern, which is substantive revenue growth nearing 8-10% a year and profit growth growing at an even faster clip. We're doing that with no debt at CRA, and we're doing that with returning a substantial amount of our adjusted cash flows back to shareholders in the form of share repurchases. We're not doing the share repurchases merely because we have some excess capital, but we're doing the share repurchases because our share price is significantly less than the intrinsic valuation of the firm. What we have enjoyed at CRA is our valuation, this intrinsic valuation, that gap continues to close, whereas in the previous five years, our average share repurchase was at $88.
I don't know where we are today, but I think we're somewhere in the $170-$180 range on a stock price. Even if you look in the short term in terms of our return of capital through share repurchases, average price during 2024 was $162. I think our view of the intrinsic value has proven to be pretty accurate, and we're striving to continue to close that value gap. Share repurchases are not the only means by which we return capital to our shareholders. A little more than a half dozen years ago, we also initiated a quarterly dividend. The reason we did that is not because we didn't have alternatives to redistribute the capital, both in terms of talent and whether the stock is fully valued at CRA. It's because we want more eyes looking at the stock.
I need more shareholders examining CRA, forming their own conclusions about the intrinsic valuation and its relationship to the prevailing stock price. The dividend was meant to introduce a new class of shareholders into CRA's investment thesis. With that said, the amount of capital being returned via dividends has grown pretty substantially, somewhere in the tune of 15%-20% over that window of time since initial initiation there. Our investment thesis is really quite simple. It's to maximize CRA's long-term value per share. Each of those words captures substantial meaning to the management team at CRA. We are value-based decision makers. Everything we do is through a value lens. The way we reinvest in our services by either organic growth or either by inorganic pursuits of talent, we look at that through a value lens. When we return capital to our shareholders, it's through the same lens.
More importantly, it's over multiple periods of time. I'm not trying to maximize our return in a single quarter or a single year. I'm looking to maximize the return of our shareholders over multiple periods of time. What we've been able to enjoy, we've been able to grow substantially with no debt, all financed by cash flows from operations, while still returning a substantive portion of those cash flows back to our shareholders. Here is something that I referenced earlier, but it makes for a damn good chart, so I will just cover it again. In the last five years, compound annual growth rate of revenue is right around 9%. If you want to go back to 2013, 2014, you're going to see the rate of growth to be roughly the same.
What is impressive is we have been reporting record revenue now for the past seven years in a row. We have been doing that by not diluting the quality of our services, but by continuing to gain penetration in the markets in which we believe we have a competitive advantage. I am quite proud of those accomplishments and our success. I think you can look at it through a few different lenses. One, we have been growing at a faster rate than the market as a whole. I do believe we have been taking share or who we are taking share from. That is a lot harder to measure, but we have been growing faster than the industry as a whole. We have been able to grow profits at a faster rate than the industry as a whole.
When you put that all together and you look at our retention rates of our consulting colleagues, we're not doing that by paying below market rates. We have to pay market to be able to attract and retain top talent, and we are. We're doing that by continuing to look for ways to optimize our profitability across the portfolio. With respect to profits, a lot of our guidance is on an EBITDA margin basis, on a constant currency EBITDA margin basis. If you want to look at a measure that's even closer to cash flows, I would encourage all of you to add back our non-cash amortization of forgivable loans. Forgivable loans is a vehicle we use to attract and maintain talent at CRA. It's purchase price considerations. Okay?
Since they're not purchases of C Corps or LLCs or brick-and-mortar institutions, a lot of these loans are to recruit highly touted individuals to execute group hires from various competitors. We use the forgivable loans as talent acquisition. The accounting rules don't have those flowing through our cash flow statement, but they have the non-cash amortization flowing through our income statement. I'm not saying they're not a cash outlay, these forgivable loans, but if you do not take it into account, you are going to double count the impact of these talent proceeds. A number of years ago, we used to have a measure called adjusted EBITDA that added the forgivable loan amortization back to EBITDA margin. We thought that was best representative of the cash-generating capacity of the firm.
The SEC didn't like the measure and asked us to stop reporting an adjusted EBITDA financial metric. What we do is I could tell you what EBITDA is. I can tell you what the forgivable loan amortization is, but I can't add the two figures together. If you want to look at the true profitability of the firm through time and not get the whipsaw that sometimes you do with measures like EBITDA or net income, I would add the two together. This is the way the executive team at CRA is measured on their performance relative to budget, the way the board looks at it. It's the way our banks look at our loan coverage ratio. This is not just a hypothetical measure of profitability. I think it generally represents the underlying economics of the firm.
To demonstrate that it is not smoke and mirrors here, the next three, four slides, what we try to do here is we try to say, "Let me give you a summary of the uses of our capital at CRA." We look at these three buckets. We look at, and the uses of the capital take into account this forgivable loan amortization. They are in three buckets. They are talent, which is acquisition and talent maintenance. It is the money we give back to shareholders and CapEx. We do not have any kind of substantive CapEx outlays. The majority of the CapEx is for computing systems and any kind of expansion of our lease obligations to provide offices to our colleagues. The reason this is so important, again, we have no debt.
Our cash flows, the outflow of our cash flows has to foot with the inflow of the cash flows, which adjust for this forgivable loan amortization on that. Over the past five years, talent acquisitions, we've outlaid roughly $230 million here of these cash flows or $185 million to the left on the pie chart here. Again, the majority of it is to acquire talent and sometimes capital needed to maintain the talent portfolio at CRA. If I have enough opportunities to invest 100% of our capital in talent acquisition and maintenance, I would. I would. We maintain the selectivity in terms of the services we want to target and the people we let into our family. With respect to the return of capital, as I mentioned earlier, or I'm sorry, someone switching the slides on me here. This is on the CapEx.
As I said earlier, there's minimal CapEx. What we've experienced in the past five years is probably even a little higher than what we may experience in the next five years. We still have capacity in many of our large offices, so I do not anticipate any kind of substantive capital expenditures related to office needs. You could see something roughly consistent with what we've been experiencing from 2020 through 2024. The return of capital to shareholders in the last five years, it is the combination of, it's roughly $200 million in total, but about $150 million in share repurchases and a little south of $50 million of dividend payments. With that, this is not just to offset any kind of share issuances that we're doing. We are substantively reducing our share count. Over the last 10 years, roughly about 25% reduction in the share count.
Over the last five years, you see roughly about a 13% reduction in the share count. With respect to the dividend, since we launched the dividend back in Q4 of 2016, we came out with a dividend of $0.14 a share. With the reporting of our Q3 earnings in 2024, the new dividend level is $0.49 a share. Almost a tripling of that amount or a little more than a tripling of that amount over that same window of time. The shareholder yield over that five-year window is roughly 6% relative to CRA's average market capitalization. We are growing, we are growing profitably, and we are returning substantive capital back to our shareholders, irrespective of how you want to measure it. This is just another depiction of the share count reduction.
We ended 2024 with share count, actually, I believe, slightly less than 6.8 million shares. Let me see how we're doing. Mark, I think I'm going to stop as opposed to jumping into some of the service examples here. I'm at 10:20 and want to give an opportunity to hear any questions that the participants may have.
Excellent. As a reminder, folks, if you'd like to submit a question, just click on the Q&A button at the bottom of the screen. We do have a few already locked and loaded, ready to go. The first and sort of the question of the day, if you will, is how do you see the market for your services, particularly legal and regulatory, with the changing of the new administration? What steps, if any, are you taking to address those changes?
Yeah, I was going to ask the participants the same question. Trying to read the tea leaves of right now with respect to our macroeconomy, the geopolitical forces here. Quite frankly, it's really difficult on that. What I can say, since the election back in November, I haven't seen a substantive shift, a little volatility month to month maybe, but I haven't seen a substantive shift in the demand and the inflow of opportunities coming into CRA. There's been a lot of publicity in the month of January. M&A activity was at sort of a 10-year trough with that. People are expecting it to rebound. When exactly, that still remains to be seen. One of the reasons our strategic goal has always been to add depth to the current services that we provide.
We think adding depth to those services as opposed to breadth enables us to weather this volatility in the short to medium term. As we have during the past decade, I think we're positioned well, irrespective of the outcomes of the macro forces or the geopolitical forces. Great. One of the questions talks about the balance sheet in the sense of asking if you have always operated debt-free. In what scenario might it make sense to take on debt, whether that's driven by M&A or any other opportunities? Sure. We had some convertible notes when I assumed the CEO role that we retired within a couple of years of assuming that role. We haven't had debt for close to 15 years, 13-15 years on that. I'm not opposed to having debt. Our cash flows are clearly strong enough to bring on debt.
I'm still pretty much a fundamentalist, and I'm going to let the asset side of the balance sheet dictate what our liabilities look like. What I mean by that is if there is a substantive talent opportunity in the marketplace or a growth opportunity in the marketplace, I am willing to take on debt to fund the asset growth of the firm. I'm not really one of this active financial engineering of trying to just play with the right side of that balance sheet. If the right asset opportunity comes around, yeah, we are open to expanding the liabilities of CRA.
Okay. One of the questions actually is kind of consistent with the slide that's actually on the screen now. Can you talk a little bit about the revenue model and the key drivers there?
As well as mentioning, maybe you could talk a little bit about the pricing dynamic and what you're seeing there.
Sure. The majority of the legal regulatory services are on a time and material basis, meaning we bill our hours and we get paid for our hours. On the management consulting side, it is more of a fixed price kind of revenue model there. We collect a very high percentage, somewhere in the 97%-98% on the dollar that we bill to our clients. We do not operate in a world in which we are providing large discounts off the stated rates. I think that shows a lot of discipline by my colleagues, and it also shows their commitment to constantly try to increase the value provided to our clients with respect to our services on it.
In an average year, we probably have rate increases in a 2-4% range, right? Our bill rate increases. That is about the same range that we put into action in 2025. So far, I haven't seen any substantive rejection of those rates by our clients. They're being accepted. We're able to roll them into the new projects coming into the firm for that. I think that should come to fruition as we continue through fiscal 2025. We talked about during the earnings call, I should say, you made some mention of some of the areas that were performing nicely, as well as some of the things that you're seeing as far as the M&A environment for the beginning of the year. Maybe wondered if you could spend a little time updating folks who may not be familiar with that. Sure.
As any proud parent, I really like all of our services that we have at CRA, like love and all your children. I may not love them all equally, but the fact is what you've seen, if you listen into our earnings calls through the number of years, you see certain practices have different periods of surge of expansion of their business. Growth, except if you're an antitrust and competition practice, is not usually steady and linear. There's volatility around it. As long as that we have an upward sloping line on that volatility, I'm fine with that. That's exactly what we've been seeing across our portfolio. The antitrust and competition practice continues to demonstrate its strength in the marketplace and its desire by clients to use our consultants on their most pressing merger and antitrust-related matters. The other practices we have, there's some volatility around it.
There's some periods of reloading your growth opportunities. For a good half dozen years, our forensic practice went through really substantive growth on that. For the last couple of years, they've been reloading on the growth opportunities. I think there's a platform that we're looking for big things from them in the years ahead. Our energy practice, which I've always been quick to tout, I think the market, the industry is undergoing substantive changes and really can use the kind of consulting services that CRA provides. I see a lot of big things for that practice ahead. In the last few years, you saw us taking advantage of talent opportunities to double the size of a couple of our practices. The first, about three, four years ago, was our labor and employment practice, which the acquisition of Welch Consulting.
In 2024, we had a really wonderful opportunity with a group hire that almost doubled the size of our intellectual property practice on that. That is what I mean. It is not just focusing on one or two of our services. It is looking at the entire portfolio and taking advantage of the opportunities that are resonant in the market.
I know we only have a minute or so left here, but I did want to sneak in one of the quick questions here. Are there any new geographies that you are thinking of expanding into or maybe any international opportunities that might be present?
Sure. I would love to continue to add depth to many of our operations across the Atlantic, both in the U.K. and in Europe. We are in regular discussions about where in Asia should we open up an offering.
I think that would assist both our antitrust and competition practice and our life sciences practice, which operate in more of a global platform in terms of the recommendations they're providing to our clients. Would I be surprised in the next three or so years to have an operation in Asia? No. We want to make sure we choose wisely with respect to our geographic expansion.
Excellent. That's an outstanding place to leave it here as we are out of time. I do want to thank all of our participants. I want to thank Charles River Associates for joining us today. Everyone have a wonderful and productive remainder of the day. Thank you so much.