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View All NewsKorn Ferry fee revenue up on Hay Group acquisition, Futurestep growth
Executive search and advisory firm Korn Ferry International (NYSE: KFY) reported fee revenue rose 40.5% in its fiscal first quarter ended July 31. Executive search revenue fell 4%, Futurestep revenue rose 19% and Hay Group was essentially flat year over year on a same-store sales basis, according to the company.
Korn Ferry closed on its acquisition of the Hay Group on Dec. 1, and its integration was substantially completed in the fiscal first quarter. Korn Ferry converted 75% of legacy Hay Group revenue to Korn Ferry’s systems and processes, physically relocated approximately 3,150 colleagues and combined 85 offices in the quarter.
First-quarter results include $24.5 million net restructuring charges, of which $11.5 million relates to severance and $13.0 million relates to the consolidation of office space.
| (US$ thousands) | Q1 2016 | Q1 2015 | % growth |
| Fee revenue | $375,621 | $267,394 | 40.5% |
| Net income | $4,068 | $23,082 | -82.4% |
Fee revenue by segment and geography
| (US$ thousands) | Q1 2016 | Q1 2015 | % growth |
| Executive search | |||
| North America | $81,802 | $90,359 | -9.5% |
| Europe, the Middle East, Africa | $35,370 | $36,090 | -2.0% |
| Asia Pacific | $19,626 | $19,215 | 2.1% |
| Latin America | $9,563 | $6,426 | 48.8% |
| Total executive search | $146,361 | $152,090 | -3.8% |
| Hay Group | $174,582 | $69,240 | 152.1% |
| Futurestep* | $54,678 | $46,064 | 18.7% |
| *Futurestep includes recruitment process outsourcing, project-based recruitment and other services. | |||
Guidance
Korn Ferry expects second-quarter fee revenue to be between $380 million and $400 million.
Share price and market cap
Shares in Korn Ferry fell 4.61% to $22.98 in late morning trading today and the company had a market cap of $1.32 billion, according to Yahoo!