Net revenue rose at Heidrick & Struggles International Inc. (NASD: HSII) in the third quarter ended 30 September 2018 by 17.4%, or 18.5% in constant currency. 

The US-based company said revenue growth was driven by strong results in Executive Search. The group’s consulting segment reported a decrease in net revenue.

 Net Revenue by segment and geography was as follows.

Within Executive Search, all three regions contributed to growth with net revenue increasing 20.7% in the Americas, 10.2% in Europe and 28.5% in Asia Pacific. Every industry practice also contributed to year-over-year growth, with the largest increases in billings in Financial Services, up 23%, and Industrial, up 31%.

The decline in Heidrick Consulting largely reflects the impact of the new revenue recognition accounting on enterprise license agreements, which increased deferred revenue thereby reducing net revenue in the quarter by approximately $0.9 million. There were 30 Heidrick Consulting Partners at 30 September 2018 compared to 27 at 30 September 2017 and 31 at 30 June 2018.

“We are very pleased to report another quarter of record net revenue, coupled with additional savings in general and administrative expenses, which led to a continued improvement in operating margin, net income and earnings per share,” Krishnan Rajagopalan, Heidrick & Struggles’ President and Chief Executive Officer, said.

“The third quarter and year-to-date results reflect the hard work of our employees globally and the continued execution of our key 2018 initiatives -- to grow our scale and impact with clients, collaborate across business lines to drive revenue, invest in the business to deliver a premium service experience to our clients, and improve profitability,” Rajagopalan said.

Looking ahead, the company is forecasting 2018 fourth quarter consolidated net revenue of between $170 million and $180 million. This forecast is based on the average currency rates in September 2018 and reflects, among other factors, management’s assumptions for the anticipated volume of new Executive Search confirmations, Heidrick Consulting assignments, the current backlog, consultant productivity, consultant retention, and the seasonality of its business.

Rajagopalan added, “Our outlook for the market demand for executive search and leadership advisory services continues to be positive. There will always be quarter-to-quarter variability that is difficult to predict given the nature of our business and global footprint, but we are on track to deliver a record year in net revenue and are well positioned to create shareholder value by executing on our 2018 initiatives.”

In trading yesterday, Heidrick & Struggles shares closed at $29.36, up 1.28% on the day and 40.14% above the 52 week low of $20.95 set on 27 February 2018. Based on its current share price the company has a market value of $556.63 million.