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Heidrick & Struggles International Inc. Reports Operating Results (10-Q)

August 03, 2009 | About:

Heidrick & Struggles International Inc. (HSII) filed Quarterly Report for the period ended 2009-06-30.

Heidrick & Struggles International is one of the leading global executive search firms. With years of experience in fulfilling their clients\' leadership needs Heidrick & Struggles offers and conducts executive search services in every major business center in the world. They focus on identifying evaluating and recommending qualified candidates for senior level executive positions. Through their worldwide network of professionals they provide executive search services to a broad range of clients. Heidrick & Struggles International Inc. has a market cap of $351.7 million; its shares were traded at around $20.74 with a P/E ratio of 86.4 and P/S ratio of 0.5. The dividend yield of Heidrick & Struggles International Inc. stocks is 2.5%. Heidrick & Struggles International Inc. had an annual average earning growth of 73.8% over the past 5 years.

Highlight of Business Operations:

Revenue before reimbursements (net revenue). Consolidated net revenue decreased $76.4 million, or 45.1%, to $93.1 million for the three months ended June 30, 2009 from $169.5 million for the three months ended June 30, 2008. The negative impact of exchange rate fluctuations resulted in approximately 5 percentage points of the decline in the second quarter of 2009 as compared to the second quarter of 2008. Net revenue declined in all regions and industry groups. The number of confirmed executive searches decreased 37.1% compared to the second quarter of 2008. The number of consultants was 380 as of June 30, 2009 compared to 408 as of June 30, 2008. Productivity, as measured by annualized net revenue per consultant, was $0.9 million in the second quarter of 2009 compared to $1.7 million in the second quarter of 2008, and average revenue per executive search was $102,700 in the 2009 second quarter compared to $122,200 in the 2008 second quarter.

Net revenue in the Americas was $48.3 million for the three months ended June 30, 2009, a decrease of $38.7 million, or 44.4%, from $87.0 million in the second quarter of 2008. Net revenue in Europe was $27.5 million for the three months ended June 30, 2009, a decrease of $25.9 million, or 48.5%, from $53.3 million in the second quarter of 2008. The negative impact of exchange rate fluctuations resulted in approximately 10 percentage points of the net revenue decline in the second quarter of 2009. In Asia Pacific, net revenue was $17.3 million for the three months ended June 30, 2009, a decrease of $11.9 million, or 40.7%, from $29.2 million in the second quarter of 2008. The negative impact of exchange rate fluctuations resulted in approximately 5 percentage points of the revenue decline in the second quarter of 2009.

In the Americas, operating income for the three months ended June 30, 2009 decreased $7.5 million to $5.1 million from $12.6 million for the three months ended June 30, 2008. The decrease is due to lower net revenue of $38.7 million offset by a $30.2 million decrease in salaries and employee benefits expense and a $1.0 million decrease in general and administrative expenses.

In Europe, operating income for the three months ended June 30, 2009 decreased $6.3 million to $1.4 million from $7.7 million for the three months ended June 30, 2008. The decrease is due to lower net revenue of $25.9 million offset by a $15.6 million decrease in salaries and employee benefits expense and a $4.0 million decrease in general and administrative expenses.

In Asia Pacific, operating income for the three months ended June 30, 2009 decreased $4.4 million to $2.2 million from $6.6 million for the three months ended June 30, 2008. The decrease is due to lower net revenue of $11.9 million offset by a $6.4 million decrease in salaries and employee benefits expense and a $0.9 million decrease in general and administrative expenses.

Revenue before reimbursements (net revenue). Consolidated net revenue decreased $140.4 million, or 43.5%, to $182.3 million for the six months ended June 30, 2009 from $322.7 million for the six months ended June 30, 2008. The negative impact of exchange rate fluctuations resulted in approximately 5 percentage points of the decline in the first six months of 2009 as compared to the first six months of 2008. Net revenue declined in all the industry groups. The number of confirmed executive searches decreased 37.7% compared to the six months ended 2008. The number of consultants decreased to 380 as of June 30, 2009 compared to 408 as of June 30, 2008. Productivity, as measured by annualized net revenue per consultant, decreased to $0.9 million in the six months ended 2009 from $1.6 million in the six months ended 2008, and average revenue per executive search was $100,800 for the six months ended June 30, 2009 compared to $114,400 in for the six months ended June 30, 2008.

Read the The complete ReportHSII is in the portfolios of HOTCHKIS & WILEY of HOTCHKIS & WILEY Capital Management LLC.

Rating: 3.8/5 (5 votes)

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