Korn Ferry Reports Record Fee Revenue in Third Quarter Fiscal Report 2016

Korn Ferry International has announced their third quarter fee revenue of $344.2 million and adjusted diluted earnings per share of $0.52, excluding $58.3 million of items described above. On a GAAP basis, diluted loss per share was $0.30 in the three months ended January 31, 2016.

Korn Ferry completed the acquisition of Hay Group on December 1, 2015 which generated approximately $77.8 million of adjusted fee revenue, or $71.9 million, excluding the deferred revenue adjustment of $5.9 million related to the acquisition.

Highlights

• Korn Ferry reports record fee revenue. Fee revenue was $344.2 million on a U.S. GAAP basis and $350.1 million on an adjusted basis (includes $5.9 million in deferred revenue adjustment related to the Hay Group acquisition).
• Excluding legacy Hay Group, fee revenue was $272.3 million, an increase of 14.0% on a constant currency basis (9.1% at actual exchange rates) from Q3 FY'15. The increase was driven by continued strong performance in the North America region of Executive Recruitment (20.9% on a constant currency basis) and the Futurestep segment (23.7% on a constant currency basis).
• Legacy Hay Group produced an Adjusted EBITDA margin of 11.0% on a standalone basis. Combined with the legacy Leadership & Talent Consulting segment, the new combined Hay Group segment produced an Adjusted EBITDA margin of 15.6% in Q3 FY'16. Korn Ferry consolidated Adjusted EBITDA margin was 13.6% in Q3 FY'16.
• Q3 FY'16 diluted loss per share was $0.30. Adjusted diluted earnings per share was $0.52 in Q3 FY'16, excluding $58.3 million of restructuring charges, integration/acquisition and separation costs, and a deferred revenue adjustment related to the Hay Group acquisition, compared to diluted earnings per share of $0.46 in Q3 FY'15.
• The Company declared a quarterly dividend of $0.10 per share on March 8, 2016, payable on April 15, 2016 to stockholders of record on March 25, 2016.