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Robert Half revenue up 9%

July 24, 2015

Professional staffing firm Robert Half International Inc. (NYSE: RHI) reported net services revenue rose 9.2% in the second quarter to $1.27 billion, led by Protiviti and Robert Half Technology.

The Menlo Park, Calif.-based staffing provider’s revenue growth rates were strongest in the US, where the company said skilled professional talent is at a premium — particularly in the technology staffing area — as a result of the tightening labor market.

(US$ thousands) Q2 2015 Q2 2014 % growth
Net service revenues $1,272,058 $1,164,914 9.2%
Gross margin $530,502 $478,444 10.9%
Gross margin percentage 41.7% 41.1%  
Net income $89,706 $75,140 19.4%

The Menlo Park, Calif.-based staffing provider’s US temporary and consulting staffing revenue rose 12.4% year over year, and US permanent placement revenue increased 18.7%.

Robert Half’s international temporary and consulting staffing operations revenue fell 9.3%; however, it rose 7.7% on a same billing days and constant currency basis. International permanent placement revenue fell 11.9% but rose 3.1% on a same billing days and constant currency basis.

Quote

“We reached the half-year mark with all-time high quarterly results, led by Protiviti and Robert Half Technology," said Chairman and CEO Harold Messmer Jr. “Continued strong demand for our staffing and consulting services contributed to a record quarter. Overall, revenues grew by 9% over the prior year on a reported basis, or 13% adjusted for currency. Protiviti again reported excellent results, with currency-adjusted revenues up 23% from the previous year. Our staffing divisions also performed well, with revenues up 12% year over year adjusted for currency. As with the first quarter, growth rates were best in our US operations, but we also saw nice growth internationally.

“This was Robert Half’s 21st straight quarter of double-digit net income and earnings per share percentage growth on a year-over-year basis,” Messmer added. “Unlevered return on equity was 36 percent."

Revenue by segment

(US$ thousands) Q2 2015 Q2 2014 % growth
Accountemps $429,533 $402,996 6.6%
OfficeTeam $242,102 $226,505 6.9%
Robert Half Technology $165,618 $141,988 16.6%
Robert Half Management Resources $142,349 $139,549 2.0%
Robert Half Finance & Accounting $110,583 $102,827 7.5%
Protiviti $181,873 $151,049 20.4%

Revenue growth by geography and temp/perm

  Year-over-year revenue growth rates
2014 2015
Q1 Q2 Q3 Q4 Q1 Q2
Global            
Accountemps 1.7% 6.5% 10.1% 9.6% 8.0% 6.6%
OfficeTeam 4.7% 9.1% 14.1% 12.6% 9.5% 6.9%
Robert Half Technology 9.3% 7.8% 11.0% 11.4% 16.2% 16.6%
Robert Half Management Resources 5.6% 12.4% 18.9% 14.1% 10.4% 2.0%
             
Temporary and consulting staffing 4.1% 8.2% 12.5% 11.3% 10.0% 7.5%
Permanent placement staffing 11.1% 13.8% 16.0% 12.8% 6.2% 7.5%
             
United States            
Temporary and consulting staffing 5.9% 9.3% 13.2% 13.8% 14.8% 12.4%
Permanent placement staffing 12.6% 15.8% 21.8% 20.8% 15.6% 18.7%
             
International            
Temporary and consulting staffing -1.2% 4.6% 10.4% 3.1% -6.0% -9.3%
Permanent placement staffing 8.6% 10.6% 6.3% -0.6% -9.8% -11.9%

Guidance

Robert Half estimated third-quarter revenue of between $1.295 billion to $1.345 billion. The midpoint of guidance implies year-over-year revenue growth of 8% on a reported basis, or 12% adjusted for currency.

Share price and market cap

Shares in Robert Half fell 5.83% in early afternoon trading today to $52.84. The company had a market cap of $7.14 billion, according to Yahoo!