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View All NewsHeidrick revenue up 4% with boost from European acquisitions
Third-quarter revenue rose 3.8% at executive search firm Heidrick & Struggles International Inc. (NASD: HSII) to $148.2 million. The increase was 4.1% in constant currency.
| (US$ thousands) | Q3 2016 | Q3 2015 | % change | constant currency (US$ 000s) |
| Net revenue | $143,519 | $138,421 | 3.7% | 4.1% |
| Reimbursements | $4,720 | $4,429 | 6.6% | |
| Total revenue | $148,239 | $142,850 | 3.8% | |
| Net income | $6,940 | $7,490 | -7.3% |
Europe drove third-quarter growth with revenue up 30.7% on a constant currency basis. More than half of the growth in Europe was delivered by two London-based firms recently acquired by Heidrick — leadership advisory firm Co Company, acquired in October 2015; and JCA Group, an executive search advisory firm acquired in August 2016.
In addition to JCA Group, in the third quarter Heidrick & Struggles also acquired Philosophy IB, a leadership consultancy based in Florham Park, NJ.
Revenue by segment and geography
| Q3 2016 | Q3 2015 | % change | % growth in constant currency | |
| Executive search and leadership consulting | ||||
| Americas | $78,198 | $78,265 | -0.1% | |
| Europe | $32,895 | $25,946 | 26.8% | 30.7% |
| Asia Pacific | $23,801 | $25,031 | -4.9% | -7.6% |
| Total executive search and leadership consulting | $134,894 | $129,242 | 4.4% | |
| Culture shaping | $8,625 | $9,179 | -6.0% |
Quote
“It is important for us to achieve a strong finish to 2016, capitalizing on the investments we made over the last year,” said President and CEO Tracy Wolstencroft. “Confirmations for new searches and leadership consulting assignments were notably improved in September and we are hopeful that this momentum carries into and throughout the fourth quarter and 2017. Our larger base of higher quality consultants, combined with the additional services and intellectual property we have added in Leadership Consulting, should position Heidrick & Struggles for future revenue growth and profitability.”
Guidance
Heidrick forecasts consolidated fourth-quarter net revenue to range from a decrease of 1.7% to an increase of 5.2%.
Share price and market cap
Shares in Heidrick fell 13.27% in late morning trading today to $17.65, and the company had a market cap of $328.43 million, according to Yahoo.