Third Quarter Highlights:
- Record net revenue (revenue before reimbursements) of
$263.8 million increased 83.8% from the 2020 third quarter. - Record operating income was
$33.3 million , and operating income margin expanded to 12.6% in the quarter. - Adjusted EBITDA of
$36.1 million more than doubled from$15.9 million in the 2020 third quarter, and adjusted EBITDA margin increased 265 basis points to 13.7%. - Net income and diluted earnings per share grew to
$24.5 million and$1.21 , respectively.
"Our strong third quarter and year-to-date results demonstrate the growing market demand for our powerful combination of Executive Search, On-Demand Talent, and Consulting businesses," stated
2021 Third Quarter Results
Record consolidated net revenue of
Executive Search net revenue of
The Company had 368 Executive Search consultants at
On-Demand Talent, a new business segment, generated net revenue of
Consolidated salaries and benefits were
General and administrative expenses were
The Company's cost of services expense category was
The Company recorded a restructuring credit of
Adjusted EBITDA in the 2021 third quarter was
Net income in the 2021 third quarter was
Net cash provided by operating activities was
2021 Nine Months Results
For the nine months ended
Executive Search net revenue in the first nine months of 2021 increased 49.3%, or
On-Demand Talent, acquired on
Including restructuring charges of
Adjusted EBITDA for the first nine months of 2021 was
Net income for the first nine months of 2021 was
Dividend
The Board of Directors declared a 2021 fourth quarter cash dividend of
2021 Fourth Quarter Outlook
The Company expects 2021 fourth quarter consolidated net revenue of between
Quarterly Webcast and Conference Call
About
Non-GAAP Financial Measures
To supplement the financial results presented in accordance with generally accepted accounting principles in
The non-GAAP financial measures used within this earnings release are adjusted operating income, adjusted operating income margin, adjusted net income, adjusted basic and diluted earnings per share, adjusted effective tax rate, adjusted EBITDA, adjusted EBITDA margin and impacts of foreign currency on current period results using prior period translation rates. These measures are presented because management uses this information to monitor and evaluate financial results and trends. Management believes this information is also useful for investors. Reconciliations of these non-GAAP financial measures with the most directly comparable measures calculated and presented in accordance with GAAP are provided as schedules attached to this release.
Adjusted operating income reflects the exclusion of restructuring charges and goodwill impairment.
Adjusted operating income margin refers to adjusted operating income as a percentage of net revenue in the same period.
Adjusted net income and adjusted diluted earnings per share reflect the exclusion of restructuring charges and goodwill impairment, net of tax.
Adjusted effective tax rate reflects the exclusion of restructuring charges and goodwill impairment, net of tax.
Adjusted EBITDA refers to earnings before interest, taxes, depreciation, intangible amortization, equity-settled stock compensation expense, earnout accretion, contingent compensation related to acquisitions, restructuring charges, goodwill impairment and other non-operating income (expense).
Adjusted EBITDA margin refers to adjusted EBITDA as a percentage of net revenue in the same period.
The Company evaluates its results of operations on both an as reported and a constant currency basis. The constant currency presentation is a non-GAAP financial measure, which excludes the impact of fluctuations in foreign currency exchange rates. The Company believes providing constant currency information provides valuable supplemental information regarding its results of operations, consistent with how it evaluates its performance. The Company calculates constant currency percentages by converting its financial results in a local currency for a period using the average exchange rate for the prior period to which it is comparing. This calculation may differ from similarly-titled measures used by other companies.
Safe Harbor Statement
This press release contains forward-looking statements. The forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry in which we operate and management's beliefs and assumptions. Forward-looking statements may be identified by the use of words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "projects," "forecasts," and similar expressions. Forward-looking statements are not guarantees of future performance and involve certain known and unknown risks, uncertainties and assumptions that are difficult to predict. Actual outcomes and results may differ materially from what is expressed, forecasted or implied in the forward-looking statements. Factors that may affect the outcome of the forward-looking statements include, among other things, the impacts, direct and indirect, of the COVID-19 pandemic (including the emergence of variant strains) on our business, our consultants and employees, and the overall economy; leadership changes, our ability to attract, integrate, develop, manage and retain qualified consultants and senior leaders; our ability to prevent our consultants from taking our clients with them to another firm; our ability to maintain our professional reputation and brand name; the fact that our net revenue may be affected by adverse economic conditions; our clients' ability to restrict us from recruiting their employees; the aggressive competition we face; our heavy reliance on information management systems; the fact that we face the risk of liability in the services we perform; the fact that data security, data privacy and data protection laws and other evolving regulations and cross-border data transfer restrictions may limit the use of our services and adversely affect our business; social, political, regulatory and legal risks in markets where we operate; any challenges to the classification of our on-demand talent as independent contractors; the impact of foreign currency exchange rate fluctuations; the fact that we may not be able to align our cost structure with net revenue; unfavorable tax law changes and tax authority rulings; our ability to realize our tax losses; the timing of the establishment or reversal of valuation allowance on deferred tax assets; any impairment of our goodwill, other intangible assets and other long-lived assets; our ability to execute and integrate future acquisitions; the fact that we have anti-takeover provisions that make an acquisition of us difficult and expensive; our ability to access additional credit; and the increased cybersecurity requirements, vulnerabilities, threats and more sophisticated and targeted cyber-related attacks that could pose a risk to our systems, networks, solutions, services and data. For more information on the factors that could affect the outcome of forward-looking statements, refer to our Annual Report on Form 10-K for the year ended
Contacts:
Investors & Analysts:
wwebb@heidrick.com
Media:
nchang@heidrick.com
Consolidated Statements of Comprehensive Income (Loss) (In thousands, except per share amounts) (Unaudited) |
||||||||||||||
Three Months Ended |
||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||
Revenue |
||||||||||||||
Revenue before reimbursements (net revenue) |
$ |
263,825 |
$ |
143,544 |
$ |
120,281 |
83.8 |
% |
||||||
Reimbursements |
1,490 |
957 |
533 |
55.7 |
% |
|||||||||
Total revenue |
265,315 |
144,501 |
120,814 |
83.6 |
% |
|||||||||
Operating expenses |
||||||||||||||
Salaries and benefits |
185,904 |
103,893 |
82,011 |
78.9 |
% |
|||||||||
General and administrative expenses |
29,155 |
28,899 |
256 |
0.9 |
% |
|||||||||
Cost of services |
18,686 |
870 |
17,816 |
NM |
||||||||||
Restructuring charges |
(3,262) |
48,115 |
(51,377) |
(106.8) |
% |
|||||||||
Reimbursed expenses |
1,490 |
957 |
533 |
55.7 |
% |
|||||||||
Total operating expenses |
231,973 |
182,734 |
49,239 |
26.9 |
% |
|||||||||
Operating income (loss) |
33,342 |
(38,233) |
71,575 |
(187.2) |
% |
|||||||||
Non-operating income (expense) |
||||||||||||||
Interest, net |
90 |
(180) |
||||||||||||
Other, net |
145 |
1,819 |
||||||||||||
Net non-operating income |
235 |
1,639 |
||||||||||||
Income (loss) before income taxes |
33,577 |
(36,594) |
||||||||||||
Provision for (benefit from) income taxes |
9,079 |
(10,416) |
||||||||||||
Net income (loss) |
24,498 |
(26,178) |
||||||||||||
Other comprehensive income (loss), net of tax |
(661) |
850 |
||||||||||||
Comprehensive income (loss) |
$ |
23,837 |
$ |
(25,328) |
||||||||||
Weighted-average common shares outstanding |
||||||||||||||
Basic |
19,569 |
19,351 |
||||||||||||
Diluted |
20,240 |
19,351 |
||||||||||||
Earnings (loss) per common share |
||||||||||||||
Basic |
$ |
1.25 |
$ |
(1.35) |
||||||||||
Diluted |
$ |
1.21 |
$ |
(1.35) |
||||||||||
Salaries and benefits as a % of net revenue |
70.5 |
% |
72.4 |
% |
||||||||||
General and administrative expenses as a % of net revenue |
11.1 |
% |
20.1 |
% |
||||||||||
Cost of services as a % of net revenue |
7.1 |
% |
0.6 |
% |
||||||||||
Operating margin |
12.6 |
% |
(26.6) |
% |
Segment Information (In thousands) (Unaudited) |
||||||||||||||||||||
Three Months Ended |
||||||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
2021 |
2020 |
|||||||||||||||
Revenue |
||||||||||||||||||||
Executive Search |
||||||||||||||||||||
|
$ |
148,844 |
$ |
79,947 |
$ |
68,897 |
86.2 |
% |
||||||||||||
|
42,676 |
28,902 |
13,774 |
47.7 |
% |
|||||||||||||||
|
30,126 |
20,394 |
9,732 |
47.7 |
% |
|||||||||||||||
Total Executive Search |
221,646 |
129,243 |
92,403 |
71.5 |
% |
|||||||||||||||
On-Demand Talent |
24,287 |
— |
24,287 |
NM |
||||||||||||||||
|
17,892 |
14,301 |
3,591 |
25.1 |
% |
|||||||||||||||
Revenue before reimbursements (net revenue) |
263,825 |
143,544 |
120,281 |
83.8 |
% |
|||||||||||||||
Reimbursements |
1,490 |
957 |
533 |
55.7 |
% |
|||||||||||||||
Total revenue |
$ |
265,315 |
$ |
144,501 |
$ |
120,814 |
83.6 |
% |
||||||||||||
Operating income (loss) |
||||||||||||||||||||
Executive Search |
||||||||||||||||||||
|
$ |
38,972 |
$ |
(7,934) |
$ |
46,906 |
(591.2) |
% |
26.2 |
% |
(9.9) |
% |
||||||||
|
4,795 |
(6,856) |
11,651 |
169.9 |
% |
11.2 |
% |
(23.7) |
% |
|||||||||||
|
4,712 |
(1,726) |
6,438 |
373.0 |
% |
15.6 |
% |
(8.5) |
% |
|||||||||||
Total Executive Search |
48,479 |
(16,516) |
64,995 |
(393.5) |
% |
21.9 |
% |
(12.8) |
% |
|||||||||||
On-Demand Talent |
881 |
— |
881 |
NM |
3.6 |
% |
— |
% |
||||||||||||
|
(2,556) |
(9,286) |
6,730 |
72.5 |
% |
(14.3) |
% |
(64.9) |
% |
|||||||||||
Total segments |
46,804 |
(25,802) |
72,606 |
281.4 |
% |
17.7 |
% |
(18.0) |
% |
|||||||||||
Global Operations Support6 |
(13,462) |
(12,431) |
(1,031) |
(8.3) |
% |
(5.1) |
% |
(8.7) |
% |
|||||||||||
Total operating income (loss) |
$ |
33,342 |
$ |
(38,233) |
$ |
71,575 |
187.2 |
% |
12.6 |
% |
(26.6) |
% |
1 Margin based on revenue before reimbursements (net revenue). |
2 Includes a restructuring reversal of |
3 Includes restructuring charges of less than |
4 Includes restructuring charges of |
5 Includes a restructuring reversal of |
6 Includes a restructuring reversal of |
Consolidated Statements of Comprehensive Income (Loss) (In thousands, except per share amounts) (Unaudited) |
||||||||||||||
Nine Months Ended |
||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||
Revenue |
||||||||||||||
Revenue before reimbursements (net revenue) |
$ |
717,462 |
$ |
460,628 |
$ |
256,834 |
55.8 |
% |
||||||
Reimbursements |
3,819 |
6,555 |
(2,736) |
(41.7) |
% |
|||||||||
Total revenue |
721,281 |
467,183 |
254,098 |
54.4 |
% |
|||||||||
Operating expenses |
||||||||||||||
Salaries and benefits |
513,321 |
329,640 |
183,681 |
55.7 |
% |
|||||||||
General and administrative expenses |
83,876 |
91,122 |
(7,246) |
(8.0) |
% |
|||||||||
Cost of services |
34,817 |
2,848 |
31,969 |
NM |
||||||||||
Impairment charges |
— |
32,970 |
(32,970) |
(100.0) |
% |
|||||||||
Restructuring charges |
3,792 |
48,115 |
(44,323) |
(92.1) |
% |
|||||||||
Reimbursed expenses |
3,819 |
6,555 |
(2,736) |
(41.7) |
% |
|||||||||
Total operating expenses |
639,625 |
511,250 |
128,375 |
25.1 |
% |
|||||||||
Operating income (loss) |
81,656 |
(44,067) |
125,723 |
NM |
||||||||||
Non-operating income |
||||||||||||||
Interest, net |
207 |
160 |
||||||||||||
Other, net |
6,260 |
460 |
||||||||||||
Net non-operating income |
6,467 |
620 |
||||||||||||
Income (loss) before income taxes |
88,123 |
(43,447) |
||||||||||||
Provision for (benefit from) income taxes |
28,028 |
(202) |
||||||||||||
Net income (loss) |
60,095 |
(43,245) |
||||||||||||
Other comprehensive loss, net of tax |
(1,349) |
(1,395) |
||||||||||||
Comprehensive income (loss) |
$ |
58,746 |
$ |
(44,640) |
||||||||||
Weighted-average common shares outstanding |
||||||||||||||
Basic |
19,489 |
19,281 |
||||||||||||
Diluted |
20,259 |
19,281 |
||||||||||||
Earnings (loss) per common share |
||||||||||||||
Basic |
$ |
3.08 |
$ |
(2.24) |
||||||||||
Diluted |
$ |
2.97 |
$ |
(2.24) |
||||||||||
Salaries and benefits as a % of net revenue |
71.5 |
% |
71.6 |
% |
||||||||||
General and administrative expenses as a % of net revenue |
11.7 |
% |
19.8 |
% |
||||||||||
Cost of services as a % of net revenue |
4.9 |
% |
0.6 |
% |
||||||||||
Operating margin |
11.4 |
% |
(9.6) |
% |
Segment Information (In thousands) (Unaudited) |
||||||||||||||||||||
Nine Months Ended |
||||||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
2021 |
2020 |
|||||||||||||||
Revenue |
||||||||||||||||||||
Executive Search |
||||||||||||||||||||
|
$ |
412,740 |
$ |
265,088 |
$ |
147,652 |
55.7 |
% |
||||||||||||
|
125,228 |
92,108 |
33,120 |
36.0 |
% |
|||||||||||||||
|
87,429 |
61,654 |
25,775 |
41.8 |
% |
|||||||||||||||
Total Executive Search |
625,397 |
418,850 |
206,547 |
49.3 |
% |
|||||||||||||||
On-Demand Talent |
43,006 |
— |
43,006 |
NM |
||||||||||||||||
|
49,059 |
41,778 |
7,281 |
17.4 |
% |
|||||||||||||||
Revenue before reimbursements (net revenue) |
717,462 |
460,628 |
256,834 |
55.8 |
% |
|||||||||||||||
Reimbursements |
3,819 |
6,555 |
(2,736) |
(41.7) |
% |
|||||||||||||||
Total revenue |
$ |
721,281 |
$ |
467,183 |
$ |
254,098 |
54.4 |
% |
||||||||||||
Operating income (loss) |
||||||||||||||||||||
Executive Search |
||||||||||||||||||||
|
$ |
99,822 |
$ |
40,900 |
$ |
58,922 |
144.1 |
% |
24.2 |
% |
15.4 |
% |
||||||||
|
13,314 |
(26,874) |
40,188 |
149.5 |
% |
10.6 |
% |
(29.2) |
% |
|||||||||||
|
13,241 |
(6,553) |
19,794 |
302.1 |
% |
15.1 |
% |
(10.6) |
% |
|||||||||||
Total Executive Search |
126,377 |
7,473 |
118,904 |
1591.1 |
% |
20.2 |
% |
1.8 |
% |
|||||||||||
On-Demand Talent |
1,034 |
— |
1,034 |
NM |
2.4 |
% |
— |
% |
||||||||||||
|
(10,897) |
(21,699) |
10,802 |
49.8 |
% |
(22.2) |
% |
(51.9) |
% |
|||||||||||
Total segments |
116,514 |
(14,226) |
130,740 |
(919.0) |
% |
16.2 |
% |
(3.1) |
% |
|||||||||||
Global Operations Support6 |
(34,858) |
(29,841) |
(5,017) |
(16.8) |
% |
(4.9) |
% |
(6.5) |
% |
|||||||||||
Total operating income (loss) |
$ |
81,656 |
$ |
(44,067) |
$ |
125,723 |
285.3 |
% |
11.4 |
% |
(9.6) |
% |
1 Margin based on revenue before reimbursements (net revenue). |
2 Includes restructuring charges of |
3 Includes a restructuring reversal of |
4 Includes a restructuring reversal of |
5 Includes restructuring charges of |
6 Includes a restructuring reversal of |
Reconciliation of Operating Income (Loss) and Adjusted Operating Income (Non-GAAP) (In thousands) (Unaudited) |
|||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
2021 |
2020 |
2021 |
2020 |
||||||||||||
Revenue before reimbursements (net revenue) |
$ |
263,825 |
$ |
143,544 |
$ |
717,462 |
$ |
460,628 |
|||||||
Operating income (loss) |
33,342 |
(38,233) |
81,656 |
(44,067) |
|||||||||||
Adjustments |
|||||||||||||||
Impairment charges1 |
— |
— |
— |
32,970 |
|||||||||||
Restructuring charges2 |
(3,262) |
48,115 |
3,792 |
48,115 |
|||||||||||
Total adjustments |
(3,262) |
48,115 |
3,792 |
81,085 |
|||||||||||
Adjusted operating income |
$ |
30,080 |
$ |
9,882 |
$ |
85,448 |
$ |
37,018 |
|||||||
Operating margin |
12.6 |
% |
(26.6) |
% |
11.4 |
% |
(9.6) |
% |
|||||||
Adjusted operating margin |
11.4 |
% |
6.9 |
% |
11.9 |
% |
8.0 |
% |
1 The Company incurred goodwill impairment charges of approximately |
2 The Company incurred restructuring reversals of |
Reconciliation of Net Income (Loss) and Adjusted Net Income (Non-GAAP) (In thousands) (Unaudited) |
|||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
2021 |
2020 |
2021 |
2021 |
||||||||||||
Net income (loss) |
$ |
24,498 |
$ |
(26,178) |
$ |
60,095 |
$ |
(43,245) |
|||||||
Adjustments |
|||||||||||||||
Impairment charges, net of tax1 |
— |
— |
— |
32,970 |
|||||||||||
Restructuring charges, net of tax2 |
(2,075) |
33,863 |
2,642 |
33,863 |
|||||||||||
Total adjustments |
(2,075) |
33,863 |
2,642 |
66,833 |
|||||||||||
Adjusted net income |
$ |
22,423 |
$ |
7,685 |
$ |
62,737 |
$ |
23,588 |
|||||||
Weighted-average common shares outstanding |
|||||||||||||||
Basic |
19,569 |
19,351 |
19,489 |
19,281 |
|||||||||||
Diluted |
20,240 |
19,730 |
20,259 |
19,833 |
|||||||||||
Earnings (loss) per common share |
|||||||||||||||
Basic |
$ |
1.25 |
$ |
(1.35) |
$ |
3.08 |
$ |
(2.24) |
|||||||
Diluted |
$ |
1.21 |
$ |
(1.35) |
$ |
2.97 |
$ |
(2.24) |
|||||||
Adjusted earnings per common share |
|||||||||||||||
Basic |
$ |
1.15 |
$ |
0.40 |
$ |
3.22 |
$ |
1.22 |
|||||||
Diluted |
$ |
1.11 |
$ |
0.39 |
$ |
3.10 |
$ |
1.19 |
1 The Company incurred goodwill impairment charges of approximately |
2 The Company incurred restructuring reversals of |
Consolidated Balance Sheets (In thousands) (Unaudited) |
|||||||
|
|
||||||
Current assets |
|||||||
Cash and cash equivalents |
$ |
348,292 |
$ |
316,473 |
|||
Marketable securities |
— |
19,999 |
|||||
Accounts receivable, net |
181,167 |
88,123 |
|||||
Prepaid expenses |
26,624 |
18,956 |
|||||
Other current assets |
34,447 |
23,279 |
|||||
Income taxes recoverable |
4,386 |
5,856 |
|||||
Total current assets |
594,916 |
472,686 |
|||||
Non-current assets |
|||||||
Property and equipment, net |
20,939 |
23,492 |
|||||
Operating lease right-of-use assets |
74,744 |
92,671 |
|||||
Assets designated for retirement and pension plans |
13,672 |
14,425 |
|||||
Investments |
34,738 |
31,369 |
|||||
Other non-current assets |
25,852 |
24,439 |
|||||
|
137,047 |
91,643 |
|||||
Other intangible assets, net |
10,223 |
1,129 |
|||||
Deferred income taxes |
36,501 |
35,958 |
|||||
Total non-current assets |
353,716 |
315,126 |
|||||
Total assets |
$ |
948,632 |
$ |
787,812 |
|||
Current liabilities |
|||||||
Accounts payable |
$ |
18,119 |
$ |
8,799 |
|||
Accrued salaries and benefits |
305,186 |
217,908 |
|||||
Deferred revenue |
45,284 |
38,050 |
|||||
Operating lease liabilities |
18,992 |
28,984 |
|||||
Other current liabilities |
22,723 |
23,311 |
|||||
Income taxes payable |
14,742 |
1,186 |
|||||
Total current liabilities |
425,046 |
318,238 |
|||||
Non-current liabilities |
|||||||
Accrued salaries and benefits |
52,623 |
56,925 |
|||||
Retirement and pension plans |
55,804 |
53,496 |
|||||
Operating lease liabilities |
63,336 |
86,816 |
|||||
Other non-current liabilities |
28,567 |
4,735 |
|||||
Total non-current liabilities |
200,330 |
201,972 |
|||||
Total liabilities |
625,376 |
520,210 |
|||||
Stockholders' equity |
323,256 |
267,602 |
|||||
Total liabilities and stockholders' equity |
$ |
948,632 |
$ |
787,812 |
Consolidated Statements of Cash Flows (In thousands) (Unaudited) |
||||||||
Three Months Ended |
||||||||
2021 |
2020 |
|||||||
Cash flows - operating activities |
||||||||
Net income (loss) |
$ |
24,498 |
$ |
(26,178) |
||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
4,534 |
16,171 |
||||||
Deferred income taxes |
(347) |
320 |
||||||
Stock-based compensation expense |
2,820 |
3,212 |
||||||
Accretion expense related to earnout payments |
182 |
— |
||||||
Gain on marketable securities |
— |
(22) |
||||||
Loss on disposal of property and equipment |
12 |
14 |
||||||
Changes in assets and liabilities, net of effects of acquisition: |
||||||||
Accounts receivable |
(13,897) |
7,397 |
||||||
Accounts payable |
434 |
664 |
||||||
Accrued expenses |
113,697 |
52,066 |
||||||
Restructuring accrual |
(361) |
7,769 |
||||||
Deferred revenue |
3,575 |
(1,219) |
||||||
Income taxes recoverable and payable, net |
2,422 |
(18,215) |
||||||
Retirement and pension plan assets and liabilities |
7 |
29 |
||||||
Prepaid expenses |
(1,742) |
3,312 |
||||||
Other assets and liabilities, net |
(18,715) |
6,540 |
||||||
Net cash provided by operating activities |
117,119 |
51,860 |
||||||
Cash flows - investing activities |
||||||||
Capital expenditures |
(1,196) |
(2,565) |
||||||
Purchases of marketable securities and investments |
(326) |
(47,249) |
||||||
Proceeds from sales of marketable securities and investments |
338 |
49,166 |
||||||
Net cash used in investing activities |
(1,184) |
(648) |
||||||
Cash flows - financing activities |
||||||||
Payments on line of credit |
— |
(100,000) |
||||||
Cash dividends paid |
(2,862) |
(3,022) |
||||||
Net cash used in financing activities |
(2,862) |
(103,022) |
||||||
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash |
(2,595) |
3,627 |
||||||
Net increase (decrease) in cash, cash equivalents and restricted cash |
110,478 |
(48,183) |
||||||
Cash, cash equivalents and restricted cash at beginning of period |
237,848 |
218,760 |
||||||
Cash, cash equivalents and restricted cash at end of period |
$ |
348,326 |
$ |
170,577 |
Consolidated Statements of Cash Flows (In thousands) (Unaudited) |
||||||||
Nine Months Ended |
||||||||
2021 |
2020 |
|||||||
Cash flows - operating activities |
||||||||
Net income (loss) |
$ |
60,095 |
$ |
(43,245) |
||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
||||||||
Depreciation and amortization |
16,576 |
20,638 |
||||||
Deferred income taxes |
(1,486) |
700 |
||||||
Stock-based compensation expense |
8,672 |
7,146 |
||||||
Accretion expense related to earnout payments |
363 |
— |
||||||
Gain on marketable securities |
(1) |
(144) |
||||||
Loss on disposal of property and equipment |
127 |
289 |
||||||
Impairment charges |
— |
32,970 |
||||||
Changes in assets and liabilities, net of effects of acquisition: |
||||||||
Accounts receivable |
(84,877) |
(9,616) |
||||||
Accounts payable |
2,931 |
2,809 |
||||||
Accrued expenses |
89,405 |
(77,776) |
||||||
Restructuring accrual |
(5,024) |
6,289 |
||||||
Deferred revenue |
6,453 |
(3,892) |
||||||
Income taxes recoverable and payable, net |
14,937 |
(11,460) |
||||||
Retirement and pension plan assets and liabilities |
1,443 |
1,304 |
||||||
Prepaid expenses |
(7,724) |
(1,229) |
||||||
Other assets and liabilities, net |
(37,114) |
2,312 |
||||||
Net cash provided by (used in) operating activities |
64,776 |
(72,905) |
||||||
Cash flows - investing activities |
||||||||
Acquisition of business, net of cash acquired |
(31,969) |
— |
||||||
Capital expenditures |
(3,902) |
(7,121) |
||||||
Purchases of marketable securities and investments |
(1,997) |
(118,668) |
||||||
Proceeds from sales of marketable securities and investments |
20,653 |
111,633 |
||||||
Net cash used in investing activities |
(17,215) |
(14,156) |
||||||
Cash flows - financing activities |
||||||||
Proceeds from line of credit |
— |
100,000 |
||||||
Payments on line of credit |
— |
(100,000) |
||||||
Cash dividends paid |
(8,927) |
(9,019) |
||||||
Payment of employee tax withholdings on equity transactions |
(3,090) |
(1,550) |
||||||
Acquisition earnout payments |
— |
(2,789) |
||||||
Net cash used in financing activities |
(12,017) |
(13,358) |
||||||
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash |
(3,707) |
(723) |
||||||
Net increase (decrease) in cash, cash equivalents and restricted cash |
31,837 |
(101,142) |
||||||
Cash, cash equivalents and restricted cash at beginning of period |
316,489 |
271,719 |
||||||
Cash, cash equivalents and restricted cash at end of period |
$ |
348,326 |
$ |
170,577 |
Reconciliation of Net Income (Loss) and Operating Income (Loss) to Adjusted EBITDA (Non-GAAP) (In thousands) (Unaudited) |
|||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
2021 |
2020 |
2021 |
2020 |
||||||||||||
Revenue before reimbursements (net revenue) |
$ |
263,825 |
$ |
143,544 |
$ |
717,462 |
$ |
460,628 |
|||||||
Net income (loss) |
24,498 |
(26,178) |
60,095 |
(43,245) |
|||||||||||
Interest, net |
(90) |
180 |
(207) |
(160) |
|||||||||||
Other, net |
(145) |
(1,819) |
(6,260) |
(460) |
|||||||||||
Provision for (benefit from) income taxes |
9,079 |
(10,416) |
28,028 |
(202) |
|||||||||||
Operating income (loss) |
33,342 |
(38,233) |
81,656 |
(44,067) |
|||||||||||
Adjustments |
|||||||||||||||
Stock-based compensation expense |
2,846 |
3,195 |
8,311 |
6,641 |
|||||||||||
Depreciation |
1,774 |
2,129 |
5,311 |
6,194 |
|||||||||||
Intangible amortization |
751 |
183 |
1,752 |
585 |
|||||||||||
Earnout accretion |
182 |
— |
363 |
— |
|||||||||||
Acquisition contingent consideration |
475 |
462 |
1,398 |
1,482 |
|||||||||||
Restructuring charges |
(3,262) |
48,115 |
3,792 |
48,115 |
|||||||||||
Impairment charges |
— |
— |
— |
32,970 |
|||||||||||
Total adjustments |
2,766 |
54,084 |
20,927 |
95,987 |
|||||||||||
Adjusted EBITDA |
$ |
36,108 |
$ |
15,851 |
$ |
102,583 |
$ |
51,920 |
|||||||
Adjusted EBITDA margin |
13.7 |
% |
11.0 |
% |
14.3 |
% |
11.3 |
% |
View original content:https://www.prnewswire.com/news-releases/heidrick--struggles-delivers-third-consecutive-quarter-of-record-results-301407833.html
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