Quarterly Revenue Exceeds High End of
Outlook
All Business Segments Contribute to Top
Line Growth
Financial Highlights:
- Q4 2024 net revenue of $276.2
million increased 9% year over year and full year net
revenue of $1,098.6 million increased
7% year over year
- Adjusted EBITDA in Q4 2024 was $26.1
million with adjusted EBITDA margin of 9.5% and full year
adjusted EBITDA was $111.2 million
with adjusted EBITDA margin of 10.1%
- Q4 2024 adjusted net income was $22.9
million with adjusted diluted earnings per share of
$1.08 and full year adjusted net
income was $66.1 million with
adjusted diluted earnings per share of $3.12
- Q1 2025 revenue outlook between $263
million and $273 million
- The Board of Directors declared a $0.15 per share cash dividend
CHICAGO, March 3,
2025 /PRNewswire/ -- Heidrick & Struggles
International, Inc. (Nasdaq: HSII) ("Heidrick & Struggles",
"Heidrick" or the "Company"), a premier provider of global
leadership advisory and on-demand talent solutions, today announced
financial results for its fourth quarter and year ended
December 31, 2024.
"We finished 2024 on a strong note, highlighted by a fourth
quarter performance that exceeded our expectations," said CEO
Tom Monahan. "As we move into 2025,
our team is energized and focused on the significant opportunity
for client impact in a complex, volatile world. This
opportunity – combined with the focus and caliber of our team –
gives us great confidence that we can attain our long-term
financial targets.
As we discussed at our inaugural investor day in December, we
serve a large and growing market defined by urgent client needs.
We've assembled a world class team and unique capabilities to meet
those needs. With our iconic brand, powerful technology and
valuable intellectual property, we are focused on rapidly achieving
the long-term goals we shared and creating value for our clients
and shareholders."
|
Selected
Consolidated Results
|
|
(Dollars in millions,
except per share amounts)
|
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Twelve Months
Ended
December 31,
|
|
2024
|
2023
|
|
2024
|
2023
|
|
Revenue before
reimbursements (net revenue)
|
$
276.2
|
$
253.2
|
|
$
1,098.6
|
$
1,026.9
|
|
|
|
|
|
|
|
Adjusted results
(a):
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
26.1
|
$
35.8
|
|
$
111.2
|
$
125.6
|
|
Adjusted EBITDA
margin
|
9.5 %
|
14.1 %
|
|
10.1 %
|
12.2 %
|
|
Adjusted net
income
|
$
22.9
|
$
14.9
|
|
$
66.1
|
$
60.4
|
|
Adjusted diluted
earnings per share
|
$
1.08
|
$
0.72
|
|
$
3.12
|
$
2.91
|
|
|
|
|
|
|
|
(a) Non-GAAP financial
measures. See Non-GAAP Financial Measures, Reconciliations of Net
Income (Loss) and Adjusted Net Income, and Reconciliations of
Operating Income (Loss) to Adjusted EBITDA at the end of this press
release for more information.
|
2024 Fourth Quarter Results
Consolidated net revenue increased 9.1% to $276.2 million in the 2024 fourth quarter
compared to consolidated net revenue of $253.2 million in the 2023 fourth quarter (up
9.3%, or $23.5 million on a constant
currency basis). The revenue increase was driven by year-over-year
growth in each of the Company's lines of business — Executive
Search, On-Demand Talent, and Heidrick Consulting.
2024 fourth quarter net loss was $15.0 million and diluted loss per share was
$0.73 which included a non-cash
goodwill impairment charge of $43.3
million related to the Company's On-Demand Talent segment
and an earnout fair value reduction of $0.8
million related to the Heidrick Consulting segment.
Excluding these charges, 2024 fourth quarter adjusted net income
increased 54.2% to $22.9 million
compared to adjusted net income of $14.9
million in the 2023 fourth quarter. 2024 fourth quarter
adjusted diluted earnings per share was $1.08, with an adjusted effective tax rate of
22.8% compared to adjusted diluted earnings per share of
$0.72 with an effective tax rate of
40.5% in the 2023 fourth quarter. On a comparable basis, applying a
40.5% effective tax rate in the 2024 fourth quarter, adjusted
diluted earnings per share increased 16.7% to $0.84 from the year-ago period.
Adjusted EBITDA was $26.1 million
in the 2024 fourth quarter compared to $35.8
million in the 2023 fourth quarter, and 2024 fourth quarter
adjusted EBITDA margin was 9.5% compared to 14.1% in the 2023
fourth quarter.
Fiscal 2024 Results
Consolidated net revenue increased 7.0%, or $71.7 million to $1,098.6
million compared to $1,026.9
million in 2023 (up 6.9%, or $71.4
million on a constant currency basis).
2024 net income was $8.7 million
and diluted earnings per share was $0.41, which included a non-cash goodwill
impairment charge of $59.5 million, a
restructuring charge of $6.9 million
and earnout fair value adjustments of $0.4
million. This compares to 2023 net income of $54.4 million and diluted earnings per share of
$2.62, which included a non-cash
goodwill impairment charge of $7.2
million. Excluding the charges in both periods, adjusted net
income increased 9.4% to $66.1
million in 2024 compared to $60.4
million in 2023 and adjusted diluted earnings per share
increased 7.2% to $3.12 in 2024
compared to $2.91 in 2023.
Adjusted EBITDA was $111.2 million
compared to $125.6 million in the
prior year. Adjusted EBITDA margin was 10.1%, compared to 12.2% in
the prior year.
|
Selected Executive
Search Data
|
|
|
|
|
|
(Dollars in millions,
except Average revenue per executive search in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Twelve Months
Ended
December 31,
|
|
2024
|
2023
|
|
2024
|
2023
|
|
Revenue before
reimbursements (net revenue)
|
$
202.5
|
$
184.0
|
|
$
818.4
|
$
780.0
|
|
Ending number of
consultants
|
418
|
414
|
|
418
|
414
|
|
Consultant
productivity
|
$
2.0
|
$
1.8
|
|
$
2.0
|
$
1.9
|
|
Average revenue per
executive search
|
$
151
|
$
138
|
|
$
146
|
$
140
|
|
Confirmations (%
increase/decrease)
|
0.5 %
|
4.0 %
|
|
0.1 %
|
(10.5) %
|
|
|
|
|
|
|
|
Adjusted results
(a):
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
50.5
|
$
54.7
|
|
$
202.4
|
$
206.7
|
|
Adjusted EBITDA
margin
|
25.0 %
|
29.7 %
|
|
24.7 %
|
26.5 %
|
|
|
(a) Non-GAAP financial
measures. See Non-GAAP Financial Measures, Reconciliations of Net
Income (Loss) and Adjusted Net Income, and Reconciliations of
Operating Income (Loss) to Adjusted EBITDA at the end of this press
release for more information.
|
Executive Search net revenue was $202.5
million in the 2024 fourth quarter compared to net revenue
of $184.0 million in the 2023 fourth
quarter, an increase of $18.6
million, or 10.1%. The increase in revenue was driven by
increases of 11.1% in the Americas (up 11.7% on a constant currency
basis), 8.1% in Europe (up 7.3% on
a constant currency basis), and 7.6% in Asia Pacific (up 8.0% on a constant currency
basis) when compared to the prior year fourth quarter.
Adjusted EBITDA was $50.5 million
in the 2024 fourth quarter compared to $54.7
million in the 2023 fourth quarter, and 2024 fourth quarter
adjusted EBITDA margin was 25.0% compared to 29.7% in the 2023
fourth quarter.
|
Selected On-Demand
Talent Data
|
|
|
|
|
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Twelve Months
Ended
December 31,
|
|
2024
|
2023
|
|
2024
|
2023
|
|
Revenue before
reimbursements (net revenue)
|
$
42.3
|
$
41.1
|
|
$
168.3
|
$
152.5
|
|
|
|
|
|
|
|
Adjusted results
(a):
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
(1.2)
|
$
0.8
|
|
$
(2.0)
|
$
1.4
|
|
Adjusted EBITDA
margin
|
(2.8) %
|
1.9 %
|
|
(1.2) %
|
0.9 %
|
|
|
|
|
|
|
|
(a) Non-GAAP financial
measures. See Non-GAAP Financial Measures, Reconciliations of Net
Income (Loss) and Adjusted Net Income, and Reconciliations of
Operating Income (Loss) to Adjusted EBITDA at the end of this press
release for more information.
|
On-Demand Talent net revenue was $42.3
million in the 2024 fourth quarter compared to net revenue
of $41.1 million in the 2023 fourth
quarter, an increase of $1.2 million
or 3.0% (up $1.3 million, or 3.3% on
a constant currency basis).
Adjusted EBITDA loss was $1.2
million in the 2024 fourth quarter compared to a gain of
$0.8 million in the 2023 fourth
quarter, and Adjusted EBITDA margin was (2.8%) compared to 1.9% in
the 2023 fourth quarter.
|
Selected Heidrick
Consulting Data
|
|
|
|
|
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Twelve Months
Ended
December 31,
|
|
2024
|
2023
|
|
2024
|
2023
|
|
Revenue before
reimbursements (net revenue)
|
$
31.3
|
$
28.1
|
|
$
111.9
|
$
94.3
|
|
Ending number of
consultants
|
85
|
89
|
|
85
|
89
|
|
|
|
|
|
|
|
Adjusted results
(a):
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
(1.8)
|
$
1.0
|
|
$
(6.2)
|
$
(5.8)
|
|
Adjusted EBITDA
margin
|
(5.7) %
|
3.6 %
|
|
(5.6) %
|
(6.2) %
|
|
|
|
|
|
|
|
(a) Non-GAAP financial
measures. See Non-GAAP Financial Measures, Reconciliations of Net
Income (Loss) and Adjusted Net Income, and Reconciliations of
Operating Income (Loss) to Adjusted EBITDA at the end of this press
release for more information.
|
Heidrick Consulting net revenue was $31.3
million in the 2024 fourth quarter compared to net revenue
of $28.1 million in the 2023 fourth
quarter, an increase of $3.2 million
or 11.5% (up $3.1 million, or 11.0%
on a constant currency basis).
Adjusted EBITDA loss was $1.8
million in the 2024 fourth quarter compared to a gain of
$1.0 million in the 2023 fourth
quarter, and Adjusted EBITDA margin was (5.7%) compared to 3.6% in
the 2023 fourth quarter.
Dividend
The Board of Directors declared a 2025 first quarter cash
dividend of $0.15 per share payable
on March 27, 2025, to shareholders of
record at the close of business on March 13,
2025.
2025 First Quarter Outlook
The Company expects 2025 first quarter consolidated net revenue
of between $263 million and
$273 million, which may be impacted
by external factors, such as the foreign exchange and interest rate
environments, foreign conflicts, inflation and macroeconomic
constraints on pricing actions. In addition, this outlook is based
on the average currency rates in December
2024 and reflects, among other factors, management's
assumptions for the anticipated volume of new Executive Search
confirmations, On-Demand Talent projects, and Heidrick Consulting
assignments, consultant productivity, and consultant retention
along with the current backlog.
Quarterly Webcast and Conference Call
Heidrick & Struggles will host a conference call to review
its fourth quarter results today, March 3,
2025, at 5:00 pm Eastern Time.
Participants may access the Company's call and supporting slides
through its website at http://www.heidrick.com or by dialing (800)
715-9871 or (646) 307-1963, conference ID# 4805686. For those
unable to participate on the live call, a webcast and copy of the
slides will be archived at http://www.heidrick.com and available
for up to 30 days following the investor call.
About Heidrick & Struggles International, Inc.
Heidrick & Struggles (Nasdaq: HSII) is the world's foremost
advisor on executive leadership, driving superior client
performance through premier human capital leadership advisory
services. For more than 70 years, we've delivered value for our
clients by leveraging unrivaled expertise to help organizations
discover and enable outstanding leaders and teams. Learn more at
www.heidrick.com.
Non-GAAP Financial Measures
To supplement the financial results presented in accordance with
generally accepted accounting principles in the United States ("GAAP"), Heidrick &
Struggles presents certain non-GAAP financial measures. A "non-GAAP
financial measure" is defined as a numerical measure of a company's
financial performance that excludes or includes amounts different
than the most directly comparable measure calculated and presented
in accordance with GAAP in the statements of comprehensive income,
balance sheets or statements of cash flow of the Company.
Non-GAAP financial measures used within this earnings release
are adjusted net income, adjusted diluted earnings per share,
adjusted effective tax rate, adjusted EBITDA, adjusted EBITDA
margin, and net revenue excluding the impact of exchange rate
fluctuations (referred to as constant currency). These measures are
presented because management uses this information to monitor and
evaluate financial results and allocate resources. Management
believes this information is also useful for investors to evaluate
the comparability of financial information presented.
Reconciliations of these non-GAAP financial measures to the most
directly comparable measures calculated and presented in accordance
with GAAP are provided as schedules attached to this release.
Adjusted net income and adjusted diluted earnings per share are
net income and diluted earnings per share excluding goodwill
impairment, restructuring charges and earnout fair value
adjustments, net of tax.
Adjusted effective tax rate is effective tax rate excluding
goodwill impairment, restructuring charges and earnout fair value
adjustments, net of tax.
Adjusted EBITDA refers to net income before interest, taxes,
depreciation and amortization, as adjusted, to the extent they
occur, for earnout accretion, earnout fair value adjustments,
contingent compensation, deferred compensation plan income or
expense, certain reorganization costs, impairment charges and
restructuring charges
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 within
the meaning of the federal securities laws, including statements
regarding guidance for the first quarter of 2025. 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," "outlook," "projects," "forecasts," "aim" and
similar expressions. Forward-looking statements are not guarantees
of future performance, rely on a number of assumptions, and involve
certain known and unknown risks and uncertainties that are
difficult to predict, many of which are beyond our control. Factors
that may cause actual outcomes and results to differ materially
from what is expressed, forecasted or implied in the
forward-looking statements include, among other things, our ability
to attract, integrate, develop, manage, retain and motivate
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;
our clients' ability to restrict us from recruiting their
employees; our heavy reliance on information management systems;
risks arising from our implementation of new technology and
intellectual property to deliver new products and services to our
clients; our dependence on third parties for the execution of
certain critical functions; 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; any
challenges to the classification of our on-demand talent as
independent contractors; the fact that increased cybersecurity
requirements, vulnerabilities, threats and more sophisticated and
targeted cyber-related attacks could pose a risk to our systems,
networks, solutions, services and data; the fact that our net
revenue may be affected by adverse macroeconomic or labor market
conditions, including impacts of inflation and effects of
geopolitical instability; the aggressive competition we face; the
impact of foreign currency exchange rate fluctuations; our ability
to access additional credit; social, political, regulatory, legal
and economic risks in markets where we operate, including the
impact of the ongoing war in Ukraine and the conflict in Israel and the Gaza strip, the risks of an expansion or
escalation of those conflicts and our ability to quickly and
completely recover from any disruption to our business; the impact
from actions by the new U.S. presidential administration and
Congress; unfavorable tax law changes and tax authority rulings;
our ability to realize the benefit of our net deferred tax assets;
the fact that we may not be able to align our cost structure with
net revenue; any impairment of our goodwill, other intangible
assets and other long-lived assets; our ability to maintain an
effective system of disclosure controls and internal control over
our financial reporting and produce accurate and timely financial
statements; our ability to execute and integrate future
acquisitions; and the fact that we have anti-takeover provisions
that make an acquisition of us difficult and expensive. We caution
the reader that the list of factors may not be exhaustive. For more
information on these risks, uncertainties and other factors, refer
to our Annual Report on Form 10-K for the year ended
December 31, 2024, under the heading "Risk Factors" in Item
1A. The forward-looking statements contained in this press release
speak only as of the date of this press release. We undertake no
obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or
otherwise.
Contacts:
Investors & Analysts:
Suzanne Rosenberg, Vice President, Investor
Relations
srosenberg@heidrick.com
Media:
Bianca Wilson,
Global Director, Public Relations
bwilson@heidrick.com
|
Heidrick &
Struggles International, Inc.
|
|
Consolidated
Statements of Comprehensive Income (Loss)
|
|
(In thousands, except
per share amounts)
|
|
(Unaudited)
|
|
|
Three Months
Ended
December
31,
|
|
|
|
2024
|
|
2023
|
|
$
Change
|
|
%
Change
|
|
Revenue
|
|
|
|
|
|
|
|
|
Revenue before
reimbursements (net revenue)
|
$
276,191
|
|
$
253,162
|
|
$
23,029
|
|
9.1 %
|
|
Reimbursements
|
4,695
|
|
4,228
|
|
467
|
|
11.0 %
|
|
Total
revenue
|
280,886
|
|
257,390
|
|
23,496
|
|
9.1 %
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
Salaries and
benefits
|
180,298
|
|
151,036
|
|
29,262
|
|
19.4 %
|
|
General and
administrative expenses
|
39,439
|
|
44,089
|
|
(4,650)
|
|
(10.5) %
|
|
Cost of
services
|
30,792
|
|
30,221
|
|
571
|
|
1.9 %
|
|
Research and
development
|
6,053
|
|
5,952
|
|
101
|
|
1.7 %
|
|
Impairment
charges
|
43,254
|
|
—
|
|
43,254
|
|
NM
|
|
Reimbursed
expenses
|
4,695
|
|
4,228
|
|
467
|
|
11.0 %
|
|
Total operating
expenses
|
304,531
|
|
235,526
|
|
69,005
|
|
29.3 %
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
(23,645)
|
|
21,864
|
|
(45,509)
|
|
NM
|
|
|
|
|
|
|
|
|
|
Non-operating income
(loss)
|
|
|
|
|
|
|
|
|
Interest,
net
|
5,154
|
|
3,950
|
|
|
|
|
|
Other, net
|
5,689
|
|
(840)
|
|
|
|
|
|
Net
non-operating income
|
10,843
|
|
3,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
(12,802)
|
|
24,974
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
2,174
|
|
10,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(14,976)
|
|
14,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income, net of tax
|
(14,985)
|
|
7,951
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss)
|
$
(29,961)
|
|
$ 22,806
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding
|
|
|
|
|
|
|
|
|
Basic
|
20,409
|
|
20,122
|
|
|
|
|
|
Diluted
|
21,125
|
|
20,670
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
common share
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.73)
|
|
$
0.74
|
|
|
|
|
|
Diluted
|
$
(0.73)
|
|
$
0.72
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
as a % of net revenue
|
65.3 %
|
|
59.7 %
|
|
|
|
|
|
General and
administrative expenses as a % of net revenue
|
14.3 %
|
|
17.4 %
|
|
|
|
|
|
Cost of services as a %
of net revenue
|
11.1 %
|
|
11.9 %
|
|
|
|
|
|
Research and
development as a % of net revenue
|
2.2 %
|
|
2.4 %
|
|
|
|
|
|
Operating
margin
|
(8.6) %
|
|
8.6 %
|
|
|
|
|
|
Heidrick &
Struggles International, Inc.
|
|
Segment
Information
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
Three Months Ended
December 31,
|
|
2024
|
|
2023
|
|
$
Change
|
|
%
Change
|
|
2024
Margin1
|
|
2023
Margin1
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
Search
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
$ 138,642
|
|
$ 124,778
|
|
$ 13,864
|
|
11.1 %
|
|
|
|
|
|
Europe
|
40,312
|
|
37,275
|
|
3,037
|
|
8.1 %
|
|
|
|
|
|
Asia
Pacific
|
23,567
|
|
21,912
|
|
1,655
|
|
7.6 %
|
|
|
|
|
|
Total Executive
Search
|
202,521
|
|
183,965
|
|
18,556
|
|
10.1 %
|
|
|
|
|
|
On-Demand
Talent
|
42,342
|
|
41,096
|
|
1,246
|
|
3.0 %
|
|
|
|
|
|
Heidrick
Consulting
|
31,328
|
|
28,101
|
|
3,227
|
|
11.5 %
|
|
|
|
|
|
Revenue before
reimbursements (net revenue)
|
276,191
|
|
253,162
|
|
23,029
|
|
9.1 %
|
|
|
|
|
|
Reimbursements
|
4,695
|
|
4,228
|
|
467
|
|
11.0 %
|
|
|
|
|
|
Total
revenue
|
$ 280,886
|
|
$ 257,390
|
|
$ 23,496
|
|
9.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
Search
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
$
43,812
|
|
$
45,801
|
|
$
(1,989)
|
|
(4.3) %
|
|
31.6 %
|
|
36.7 %
|
|
Europe
|
3,578
|
|
5,759
|
|
(2,181)
|
|
(37.9) %
|
|
8.9 %
|
|
15.5 %
|
|
Asia
Pacific
|
3,145
|
|
3,169
|
|
(24)
|
|
(0.8) %
|
|
13.3 %
|
|
14.5 %
|
|
Total Executive
Search
|
50,535
|
|
54,729
|
|
(4,194)
|
|
(7.7) %
|
|
25.0 %
|
|
29.7 %
|
|
On-Demand
Talent
|
(1,197)
|
|
774
|
|
(1,971)
|
|
NM
|
|
(2.8) %
|
|
1.9 %
|
|
Heidrick
Consulting
|
(1,790)
|
|
1,025
|
|
(2,815)
|
|
NM
|
|
(5.7) %
|
|
3.6 %
|
|
Total
segments
|
47,548
|
|
56,528
|
|
(8,980)
|
|
(15.9) %
|
|
17.2 %
|
|
22.3 %
|
|
Research and
Development
|
(4,704)
|
|
(5,139)
|
|
435
|
|
8.5 %
|
|
(1.7) %
|
|
(2.0) %
|
|
Global
Operations Support
|
(16,700)
|
|
(15,632)
|
|
(1,068)
|
|
(6.8) %
|
|
(6.0) %
|
|
(6.2) %
|
|
Total Adjusted
EBITDA
|
$
26,144
|
|
$
35,757
|
|
$
(9,613)
|
|
(26.9) %
|
|
9.5 %
|
|
14.1 %
|
|
|
|
1
|
Margin based on revenue
before reimbursements (net revenue).
|
|
Heidrick &
Struggles International, Inc.
|
|
Consolidated
Statements of Comprehensive Income (Loss)
|
|
(In thousands, except
per share amounts)
|
|
(Unaudited)
|
|
|
Twelve Months
Ended
December
31,
|
|
|
|
2024
|
|
2023
|
|
$
Change
|
|
%
Change
|
|
Revenue
|
|
|
|
|
|
|
|
|
Revenue before
reimbursements (net revenue)
|
$ 1,098,573
|
|
$ 1,026,864
|
|
$
71,709
|
|
7.0 %
|
|
Reimbursements
|
17,103
|
|
14,318
|
|
2,785
|
|
19.5 %
|
|
Total
revenue
|
1,115,676
|
|
1,041,182
|
|
74,494
|
|
7.2 %
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
Salaries and
benefits
|
715,628
|
|
656,030
|
|
59,598
|
|
9.1 %
|
|
General and
administrative expenses
|
166,995
|
|
156,494
|
|
10,501
|
|
6.7 %
|
|
Cost of
services
|
118,950
|
|
109,039
|
|
9,911
|
|
9.1 %
|
|
Research and
development
|
23,055
|
|
22,698
|
|
357
|
|
1.6 %
|
|
Impairment
charges
|
59,478
|
|
7,246
|
|
52,232
|
|
NM
|
|
Restructuring
charges
|
6,939
|
|
—
|
|
6,939
|
|
100.0 %
|
|
Reimbursed
expenses
|
17,103
|
|
14,318
|
|
2,785
|
|
19.5 %
|
|
Total operating
expenses
|
1,108,148
|
|
965,825
|
|
142,323
|
|
14.7 %
|
|
|
|
|
|
|
|
|
|
Operating
income
|
7,528
|
|
75,357
|
|
(67,829)
|
|
(90.0) %
|
|
|
|
|
|
|
|
|
|
Non-operating
income
|
|
|
|
|
|
|
|
|
Interest,
net
|
14,422
|
|
11,617
|
|
|
|
|
|
Other, net
|
8,702
|
|
1,697
|
|
|
|
|
|
Net
non-operating income
|
23,124
|
|
13,314
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
30,652
|
|
88,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
21,924
|
|
34,261
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
8,728
|
|
54,410
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss), net of tax
|
(14,174)
|
|
4,318
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss)
|
$
(5,446)
|
|
$
58,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding
|
|
|
|
|
|
|
|
|
Basic
|
20,293
|
|
20,029
|
|
|
|
|
|
Diluted
|
21,188
|
|
20,766
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share
|
|
|
|
|
|
|
|
|
Basic
|
$
0.43
|
|
$
2.72
|
|
|
|
|
|
Diluted
|
$
0.41
|
|
$
2.62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
as a % of net revenue
|
65.1 %
|
|
63.9 %
|
|
|
|
|
|
General and
administrative expenses as a % of net revenue
|
15.2 %
|
|
15.2 %
|
|
|
|
|
|
Cost of services as a %
of net revenue
|
10.8 %
|
|
10.6 %
|
|
|
|
|
|
Research and
development as a % of net revenue
|
2.1 %
|
|
2.2 %
|
|
|
|
|
|
Operating
margin
|
0.7 %
|
|
7.3 %
|
|
|
|
|
|
Heidrick &
Struggles International, Inc.
|
|
Segment
Information
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
Twelve Months Ended
December 31,
|
|
2024
|
|
2023
|
|
$
Change
|
|
%
Change
|
|
2024
Margin1
|
|
2023
Margin1
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
Search
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
$
556,944
|
|
$
522,988
|
|
$
33,956
|
|
6.5 %
|
|
|
|
|
|
Europe
|
165,018
|
|
166,379
|
|
(1,361)
|
|
(0.8) %
|
|
|
|
|
|
Asia
Pacific
|
96,396
|
|
90,678
|
|
5,718
|
|
6.3 %
|
|
|
|
|
|
Total Executive
Search
|
818,358
|
|
780,045
|
|
38,313
|
|
4.9 %
|
|
|
|
|
|
On-Demand
Talent
|
168,325
|
|
152,506
|
|
15,819
|
|
10.4 %
|
|
|
|
|
|
Heidrick
Consulting
|
111,890
|
|
94,313
|
|
17,577
|
|
18.6 %
|
|
|
|
|
|
Revenue before
reimbursements (net revenue)
|
1,098,573
|
|
1,026,864
|
|
71,709
|
|
7.0 %
|
|
|
|
|
|
Reimbursements
|
17,103
|
|
14,318
|
|
2,785
|
|
19.5 %
|
|
|
|
|
|
Total
revenue
|
$
1,115,676
|
|
$
1,041,182
|
|
$
74,494
|
|
7.2 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
Search
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
$
174,260
|
|
$
173,358
|
|
$
902
|
|
0.5 %
|
|
31.3 %
|
|
33.1 %
|
|
Europe
|
14,793
|
|
22,246
|
|
(7,453)
|
|
(33.5) %
|
|
9.0 %
|
|
13.4 %
|
|
Asia
Pacific
|
13,327
|
|
11,070
|
|
2,257
|
|
20.4 %
|
|
13.8 %
|
|
12.2 %
|
|
Total Executive
Search
|
202,380
|
|
206,674
|
|
(4,294)
|
|
(2.1) %
|
|
24.7 %
|
|
26.5 %
|
|
On-Demand
Talent
|
(1,984)
|
|
1,434
|
|
(3,418)
|
|
NM
|
|
(1.2) %
|
|
0.9 %
|
|
Heidrick
Consulting
|
(6,237)
|
|
(5,823)
|
|
(414)
|
|
(7.1) %
|
|
(5.6) %
|
|
(6.2) %
|
|
Total
segments
|
194,159
|
|
202,285
|
|
(8,126)
|
|
(4.0) %
|
|
17.7 %
|
|
19.7 %
|
|
Research and
Development
|
(19,016)
|
|
(20,535)
|
|
1,519
|
|
7.4 %
|
|
(1.7) %
|
|
(2.0) %
|
|
Global
Operations Support
|
(63,905)
|
|
(56,133)
|
|
(7,772)
|
|
(13.8) %
|
|
(5.8) %
|
|
(5.5) %
|
|
Total Adjusted
EBITDA
|
$
111,238
|
|
$
125,617
|
|
$
(14,379)
|
|
(11.4) %
|
|
10.1 %
|
|
12.2 %
|
|
|
|
1
|
Margin based on revenue
before reimbursements (net revenue).
|
|
Heidrick &
Struggles International, Inc.
|
|
Reconciliation of
Net Income (Loss) and Adjusted Net Income (Non-GAAP)
|
|
(In thousands, except
per share amounts)
|
|
(Unaudited)
|
|
|
Three Months
Ended
December
31,
|
|
Twelve Months
Ended
December
31,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net income
(loss)
|
$
(14,976)
|
|
$
14,855
|
|
$
8,728
|
|
$
54,410
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
Impairment charges, net
of tax(1)
|
37,621
|
|
—
|
|
51,811
|
|
6,038
|
|
Earnout fair value
adjustment, net of tax(2)
|
(349)
|
|
—
|
|
439
|
|
—
|
|
Restructuring charges,
net of tax(3)
|
615
|
|
—
|
|
5,131
|
|
—
|
|
Total
adjustments
|
37,887
|
|
—
|
|
57,381
|
|
6,038
|
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
$
22,911
|
|
$
14,855
|
|
$
66,109
|
|
$
60,448
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding
|
|
|
|
|
|
|
|
|
Basic
|
20,409
|
|
20,122
|
|
20,293
|
|
20,029
|
|
Diluted
|
21,125
|
|
20,670
|
|
21,188
|
|
20,766
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
common share
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.73)
|
|
$
0.74
|
|
$
0.43
|
|
$
2.72
|
|
Diluted
|
$
(0.73)
|
|
$
0.72
|
|
$
0.41
|
|
$
2.62
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
per common share
|
|
|
|
|
|
|
|
|
Basic
|
$
1.12
|
|
$
0.74
|
|
$
3.26
|
|
$
3.02
|
|
Diluted
|
$
1.08
|
|
$
0.72
|
|
$
3.12
|
|
$
2.91
|
|
|
|
1
|
The Company recorded
goodwill impairment charges of $43.3 million in the On-Demand
Talent segment for the three months ended December 31, 2024. The
Company recorded goodwill impairment charges of $58.0 million in
the On-Demand Talent segment and $1.5 million in the Europe segment
for the twelve months ended December 31, 2024. The Company recorded
a goodwill impairment charge of $7.2 million in the Heidrick
Consulting segment for the twelve months ended December 31,
2023.
|
|
2
|
The Company recorded a
fair value adjustment to decrease the Heidrick Consulting earnout
by $0.8 million for the three months ended December 31, 2024. The
Company recorded a fair value adjustment to increase the On-Demand
Talent earnout by $1.1 million and decrease the Heidrick Consulting
earnout by $0.7 million for the twelve months ended December 31,
2024.
|
|
3
|
The Company recorded
restructuring charges of $6.9 million for the twelve months ended
December 31, 2024.
|
|
Heidrick &
Struggles International, Inc.
|
|
Consolidated Balance
Sheets
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
December 31,
2024
|
|
December 31,
2023
|
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
$
515,627
|
|
$
412,618
|
|
Marketable
securities
|
47,896
|
|
65,538
|
|
Accounts receivable,
net
|
134,331
|
|
133,128
|
|
Prepaid
expenses
|
28,718
|
|
23,597
|
|
Other current
assets
|
39,935
|
|
47,923
|
|
Income taxes
recoverable
|
6,470
|
|
10,410
|
|
Total current
assets
|
772,977
|
|
693,214
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Property and equipment,
net
|
51,685
|
|
35,752
|
|
Operating lease
right-of-use assets
|
83,518
|
|
86,063
|
|
Assets designated for
retirement and pension plans
|
9,976
|
|
11,105
|
|
Investments
|
58,290
|
|
47,287
|
|
Other non-current
assets
|
25,500
|
|
17,071
|
|
Goodwill
|
137,861
|
|
202,252
|
|
Other intangible
assets, net
|
12,483
|
|
20,842
|
|
Deferred income
taxes
|
41,898
|
|
28,005
|
|
Total
non-current assets
|
421,211
|
|
448,377
|
|
|
|
|
|
Total
assets
|
$ 1,194,188
|
|
$ 1,141,591
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts
payable
|
$
25,088
|
|
$
20,837
|
|
Accrued salaries and
benefits
|
353,531
|
|
322,744
|
|
Deferred
revenue
|
51,085
|
|
45,732
|
|
Operating lease
liabilities
|
17,653
|
|
21,498
|
|
Other current
liabilities
|
21,369
|
|
21,823
|
|
Income taxes
payable
|
14,287
|
|
6,057
|
|
Total current
liabilities
|
483,013
|
|
438,691
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
Accrued salaries and
benefits
|
58,547
|
|
52,108
|
|
Retirement and pension
plans
|
72,138
|
|
62,100
|
|
Operating lease
liabilities
|
83,152
|
|
78,204
|
|
Other non-current
liabilities
|
42,905
|
|
41,808
|
|
Deferred income
taxes
|
1,616
|
|
6,402
|
|
Total
non-current liabilities
|
258,358
|
|
240,622
|
|
|
|
|
|
Total
liabilities
|
741,371
|
|
679,313
|
|
|
|
|
|
Stockholders'
equity
|
452,817
|
|
462,278
|
|
|
|
|
|
Total liabilities
and stockholders' equity
|
$ 1,194,188
|
|
$ 1,141,591
|
|
Heidrick &
Struggles International, Inc.
|
|
Consolidated
Statements of Cash Flows
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
|
Three Months
Ended
December
31,
|
|
|
2024
|
|
2023
|
|
Cash flows -
operating activities
|
|
|
|
|
|
Net income
(loss)
|
|
$ (14,976)
|
|
$
14,855
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation
and amortization
|
|
5,207
|
|
5,076
|
|
Deferred income
taxes
|
|
(17,361)
|
|
12,448
|
|
Stock-based
compensation expense
|
|
2,824
|
|
3,499
|
|
Accretion
expense related to earnout payments
|
|
513
|
|
457
|
|
Gain on
marketable securities
|
|
(340)
|
|
(878)
|
|
Loss on
disposal of property and equipment
|
|
190
|
|
17
|
|
Impairment
charges
|
|
43,254
|
|
—
|
|
Changes in
assets and liabilities, net of effects of acquisition:
|
|
|
|
|
|
Accounts
receivable
|
|
47,187
|
|
59,118
|
|
Accounts
payable
|
|
17,917
|
|
1,526
|
|
Accrued
expenses
|
|
88,403
|
|
54,668
|
|
Restructuring
accrual
|
|
(484)
|
|
—
|
|
Deferred
revenue
|
|
5,109
|
|
3,657
|
|
Income taxes
recoverable and payable, net
|
|
11,979
|
|
(13,309)
|
|
Retirement and
pension plan assets and liabilities
|
|
(364)
|
|
796
|
|
Prepaid
expenses
|
|
(1,479)
|
|
5,004
|
|
Other assets
and liabilities, net
|
|
2,609
|
|
8,979
|
|
Net cash
provided by operating activities
|
|
190,188
|
|
155,913
|
|
|
|
|
|
|
Cash flows -
investing activities
|
|
|
|
|
|
Acquisition of
businesses, net of cash acquired
|
|
—
|
|
(11,905)
|
|
Capital
expenditures
|
|
(16,668)
|
|
(3,814)
|
|
Purchases of marketable
securities and investments
|
|
(48,003)
|
|
(65,518)
|
|
Proceeds from sales of
marketable securities and investments
|
|
46,237
|
|
48,183
|
|
Net cash used
in investing activities
|
|
(18,434)
|
|
(33,054)
|
|
|
|
|
|
|
Cash flows -
financing activities
|
|
|
|
|
|
Cash dividends
paid
|
|
(3,314)
|
|
(3,154)
|
|
Payment of employee tax
withholdings on equity transactions
|
|
(17)
|
|
—
|
|
Net cash used
in financing activities
|
|
(3,331)
|
|
(3,154)
|
|
|
|
|
|
|
Effect of exchange rate
fluctuations on cash, cash equivalents and restricted
cash
|
|
(16,032)
|
|
6,442
|
|
|
|
|
|
|
Net increase in cash,
cash equivalents and restricted cash
|
|
152,391
|
|
126,147
|
|
Cash, cash equivalents
and restricted cash at beginning of period
|
|
363,422
|
|
286,471
|
|
Cash, cash equivalents
and restricted cash at end of period
|
|
$ 515,813
|
|
$ 412,618
|
|
Heidrick &
Struggles International, Inc.
|
|
Consolidated
Statements of Cash Flows
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
|
Twelve Months
Ended
December
31,
|
|
|
2024
|
|
2023
|
|
Cash flows -
operating activities
|
|
|
|
|
|
Net income
|
|
$
8,728
|
|
$
54,410
|
|
Adjustments to
reconcile net income to net cash provided by (used in)
operating
activities:
|
|
|
|
|
|
Depreciation
and amortization
|
|
18,857
|
|
18,508
|
|
Deferred income
taxes
|
|
(19,421)
|
|
11,900
|
|
Stock-based
compensation expense
|
|
12,725
|
|
10,830
|
|
Accretion
expense related to earnout payments
|
|
1,926
|
|
1,554
|
|
Gain on
marketable securities
|
|
(2,663)
|
|
(2,918)
|
|
Loss on
disposal of property and equipment
|
|
454
|
|
209
|
|
Impairment
charges
|
|
59,478
|
|
7,246
|
|
Changes in
assets and liabilities:
|
|
|
|
|
|
Accounts
receivable
|
|
(4,520)
|
|
6,913
|
|
Accounts
payable
|
|
4,625
|
|
(131)
|
|
Accrued
expenses
|
|
47,031
|
|
(145,118)
|
|
Restructuring
accrual
|
|
2,506
|
|
—
|
|
Deferred
revenue
|
|
6,272
|
|
2,035
|
|
Income taxes
recoverable and payable, net
|
|
12,326
|
|
(6,692)
|
|
Retirement and
pension plan assets and liabilities
|
|
6,021
|
|
7,493
|
|
Prepaid
expenses
|
|
(5,536)
|
|
1,233
|
|
Other assets
and liabilities, net
|
|
1,622
|
|
5,736
|
|
Net cash
provided by (used in) operating activities
|
|
150,431
|
|
(26,792)
|
|
|
|
|
|
|
Cash flows -
investing activities
|
|
|
|
|
|
Acquisition of
business, net of cash acquired
|
|
—
|
|
(49,858)
|
|
Capital
expenditures
|
|
(26,315)
|
|
(13,433)
|
|
Purchases of marketable
securities and investments
|
|
(163,611)
|
|
(140,982)
|
|
Proceeds from sales of
marketable securities and investments
|
|
175,307
|
|
337,872
|
|
Net cash
provided by (used in) investing activities
|
|
(14,619)
|
|
133,599
|
|
|
|
|
|
|
Cash flows -
financing activities
|
|
|
|
|
|
Repurchases of common
stock
|
|
—
|
|
(904)
|
|
Cash dividends
paid
|
|
(12,923)
|
|
(12,537)
|
|
Payment of employee tax
withholdings on equity transactions
|
|
(3,817)
|
|
(4,141)
|
|
Acquisition earnout
payments
|
|
—
|
|
(35,946)
|
|
Net cash used
in financing activities
|
|
(16,740)
|
|
(53,528)
|
|
|
|
|
|
|
Effect of exchange rate
fluctuations on cash, cash equivalents and restricted
cash
|
|
(15,877)
|
|
3,850
|
|
|
|
|
|
|
Net increase in cash,
cash equivalents and restricted cash
|
|
103,195
|
|
57,129
|
|
Cash, cash equivalents
and restricted cash at beginning of period
|
|
412,618
|
|
355,489
|
|
Cash, cash equivalents
and restricted cash at end of period
|
|
$
515,813
|
|
$
412,618
|
|
Heidrick &
Struggles International, Inc.
|
|
Reconciliation of
Net Income (Loss) to Adjusted EBITDA (Non-GAAP)
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
Three Months
Ended
December
31,
|
|
Twelve Months
Ended
December
31,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Revenue before
reimbursements (net revenue)
|
$
276,191
|
|
$
253,162
|
|
$
1,098,573
|
|
$
1,026,864
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(14,976)
|
|
14,855
|
|
8,728
|
|
54,410
|
|
Interest,
net
|
(5,154)
|
|
(3,950)
|
|
(14,422)
|
|
(11,617)
|
|
Other, net
|
(5,689)
|
|
840
|
|
(8,702)
|
|
(1,697)
|
|
Provision for income
taxes
|
2,174
|
|
10,119
|
|
21,924
|
|
34,261
|
|
Operating income
(loss)
|
(23,645)
|
|
21,864
|
|
7,528
|
|
75,357
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
Depreciation
|
3,302
|
|
2,550
|
|
10,782
|
|
9,113
|
|
Intangible
amortization
|
1,905
|
|
2,526
|
|
8,075
|
|
9,395
|
|
Earnout
accretion
|
513
|
|
457
|
|
1,926
|
|
1,554
|
|
Earnout fair value
adjustments
|
(773)
|
|
—
|
|
438
|
|
—
|
|
Acquisition contingent
consideration
|
2,595
|
|
3,223
|
|
10,815
|
|
11,934
|
|
Deferred compensation
plan
|
(1,007)
|
|
3,823
|
|
5,257
|
|
6,132
|
|
Reorganization
costs
|
—
|
|
1,314
|
|
—
|
|
4,886
|
|
Impairment
charges
|
43,254
|
|
—
|
|
59,478
|
|
7,246
|
|
Restructuring
charges
|
—
|
|
—
|
|
6,939
|
|
—
|
|
Total
adjustments
|
49,789
|
|
13,893
|
|
103,710
|
|
50,260
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 26,144
|
|
$ 35,757
|
|
$
111,238
|
|
$
125,617
|
|
Adjusted EBITDA
margin
|
9.5 %
|
|
14.1 %
|
|
10.1 %
|
|
12.2 %
|
|
Heidrick &
Struggles International, Inc.
|
|
Reconciliation of
Operating Income (Loss) to Adjusted EBITDA by Line of Business
(Non-GAAP)
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
Three Months Ended
December 31, 2024
|
|
Executive
Search
|
|
On-Demand
Talent
|
|
Heidrick
Consulting
|
|
Research &
Development
|
|
Global
Operations
Support
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue before
reimbursements (net
revenue)
|
$
202,521
|
|
$ 42,342
|
|
$ 31,328
|
|
$
—
|
|
$
—
|
|
$
276,191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)1
|
49,015
|
|
(48,153)
|
|
(1,578)
|
|
(6,053)
|
|
(16,876)
|
|
(23,645)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
1,352
|
|
177
|
|
229
|
|
1,365
|
|
179
|
|
3,302
|
|
Intangible
amortization
|
15
|
|
1,519
|
|
371
|
|
—
|
|
—
|
|
1,905
|
|
Earnout
accretion
|
—
|
|
428
|
|
85
|
|
—
|
|
—
|
|
513
|
|
Earnout fair value
adjustments
|
—
|
|
—
|
|
(773)
|
|
—
|
|
—
|
|
(773)
|
|
Acquisition contingent
compensation
|
1,122
|
|
1,578
|
|
(105)
|
|
—
|
|
—
|
|
2,595
|
|
Deferred compensation
plan
|
(969)
|
|
—
|
|
(19)
|
|
(16)
|
|
(3)
|
|
(1,007)
|
|
Impairment
charges
|
—
|
|
43,254
|
|
—
|
|
—
|
|
—
|
|
43,254
|
|
Total
adjustments
|
1,520
|
|
46,956
|
|
(212)
|
|
1,349
|
|
176
|
|
49,789
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 50,535
|
|
$
(1,197)
|
|
$
(1,790)
|
|
$
(4,704)
|
|
$ (16,700)
|
|
$ 26,144
|
|
Adjusted EBITDA
margin
|
25.0 %
|
|
(2.8) %
|
|
(5.7) %
|
|
(1.7) %
|
|
(6.0) %
|
|
9.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31, 2023
|
|
Executive
Search
|
|
On-Demand
Talent
|
|
Heidrick
Consulting
|
|
Research &
Development
|
|
Global
Operations
Support
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue before
reimbursements (net
revenue)
|
$
183,965
|
|
$ 41,096
|
|
$ 28,101
|
|
$
—
|
|
$
—
|
|
$
253,162
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)1
|
49,086
|
|
(4,616)
|
|
(852)
|
|
(5,952)
|
|
(15,802)
|
|
21,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
1,310
|
|
74
|
|
247
|
|
754
|
|
165
|
|
2,550
|
|
Intangible
amortization
|
28
|
|
2,060
|
|
438
|
|
—
|
|
—
|
|
2,526
|
|
Earnout
accretion
|
—
|
|
399
|
|
58
|
|
—
|
|
—
|
|
457
|
|
Acquisition contingent
compensation
|
640
|
|
1,543
|
|
1,040
|
|
—
|
|
—
|
|
3,223
|
|
Deferred compensation
plan
|
3,665
|
|
—
|
|
94
|
|
59
|
|
5
|
|
3,823
|
|
Reorganization
costs
|
—
|
|
1,314
|
|
—
|
|
—
|
|
—
|
|
1,314
|
|
Total
adjustments
|
5,643
|
|
5,390
|
|
1,877
|
|
813
|
|
170
|
|
13,893
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 54,729
|
|
$
774
|
|
$
1,025
|
|
$
(5,139)
|
|
$ (15,632)
|
|
$ 35,757
|
|
Adjusted EBITDA
margin
|
29.7 %
|
|
1.9 %
|
|
3.6 %
|
|
(2.0) %
|
|
(6.2) %
|
|
14.1 %
|
|
|
|
1
|
The Company does not
allocate interest income or expense, other income or expense, and
the provision for income taxes to the Company's reportable
operating segments. As such, the Company has concluded that
operating income (loss) represents the most directly comparable
measure of financial performance presented in accordance with U.S.
GAAP for the reconciliation of Adjusted EBITDA in this
presentation.
|
|
Heidrick &
Struggles International, Inc.
|
|
Reconciliation of
Operating Income (Loss) to Adjusted EBITDA
(Non-GAAP)
|
|
(In
thousands)
|
|
(Unaudited)
|
|
|
Twelve Months Ended
December 31, 2024
|
|
Executive
Search
|
|
On-Demand
Talent
|
|
Heidrick
Consulting
|
|
Research &
Development
|
|
Global
Operations
Support
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue before
reimbursements (net
revenue)
|
$
818,358
|
|
$
168,325
|
|
$
111,890
|
|
$
—
|
|
$
—
|
|
$ 1,098,573
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)1
|
187,638
|
|
(76,733)
|
|
(14,785)
|
|
(23,055)
|
|
(65,537)
|
|
7,528
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
4,845
|
|
600
|
|
735
|
|
3,957
|
|
645
|
|
10,782
|
|
Intangible
amortization
|
69
|
|
6,447
|
|
1,559
|
|
—
|
|
—
|
|
8,075
|
|
Earnout
accretion
|
—
|
|
1,679
|
|
247
|
|
—
|
|
—
|
|
1,926
|
|
Earnout fair value
adjustments
|
—
|
|
1,125
|
|
(687)
|
|
—
|
|
—
|
|
438
|
|
Acquisition contingent
compensation
|
996
|
|
6,597
|
|
3,222
|
|
—
|
|
—
|
|
10,815
|
|
Deferred compensation
plan
|
5,059
|
|
—
|
|
105
|
|
82
|
|
11
|
|
5,257
|
|
Impairment
charges
|
1,463
|
|
58,015
|
|
—
|
|
—
|
|
—
|
|
59,478
|
|
Restructuring
charges
|
2,310
|
|
286
|
|
3,367
|
|
—
|
|
976
|
|
6,939
|
|
Total
adjustments
|
14,742
|
|
74,749
|
|
8,548
|
|
4,039
|
|
1,632
|
|
103,710
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
202,380
|
|
$
(1,984)
|
|
$
(6,237)
|
|
$ (19,016)
|
|
$ (63,905)
|
|
$
111,238
|
|
Adjusted EBITDA
margin
|
24.7 %
|
|
(1.2 %)
|
|
(5.6 %)
|
|
(1.7 %)
|
|
(5.8) %
|
|
10.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended
December 31, 2023
|
|
Executive
Search
|
|
On-Demand
Talent
|
|
Heidrick
Consulting
|
|
Research &
Development
|
|
Global
Operations
Support
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue before
reimbursements (net
revenue)
|
$
780,045
|
|
$
152,506
|
|
$ 94,313
|
|
$
—
|
|
$
—
|
|
$ 1,026,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)1
|
190,009
|
|
(16,437)
|
|
(18,729)
|
|
(22,698)
|
|
(56,788)
|
|
75,357
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
5,238
|
|
400
|
|
754
|
|
2,073
|
|
648
|
|
9,113
|
|
Intangible
amortization
|
173
|
|
7,797
|
|
1,425
|
|
—
|
|
—
|
|
9,395
|
|
Earnout
accretion
|
—
|
|
1,381
|
|
173
|
|
—
|
|
—
|
|
1,554
|
|
Acquisition contingent
compensation
|
3,089
|
|
5,687
|
|
3,158
|
|
—
|
|
—
|
|
11,934
|
|
Deferred compensation
plan
|
5,885
|
|
—
|
|
150
|
|
90
|
|
7
|
|
6,132
|
|
Reorganization
costs
|
2,280
|
|
2,606
|
|
—
|
|
—
|
|
—
|
|
4,886
|
|
Impairment
charges
|
—
|
|
—
|
|
7,246
|
|
—
|
|
—
|
|
7,246
|
|
Total
adjustments
|
16,665
|
|
17,871
|
|
12,906
|
|
2,163
|
|
655
|
|
50,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
206,674
|
|
$
1,434
|
|
$
(5,823)
|
|
$ (20,535)
|
|
$ (56,133)
|
|
$
125,617
|
|
Adjusted EBITDA
margin
|
26.5 %
|
|
0.9 %
|
|
(6.2 %)
|
|
(2.0 %)
|
|
(5.5 %)
|
|
12.2 %
|
|
|
|
1
|
The Company does not
allocate interest income or expense, other income or expense, and
the provision for income taxes to the Company's reportable
operating segments. As such, the Company has concluded that
operating income (loss) represents the most directly comparable
measure of financial performance presented in accordance with U.S.
GAAP for the reconciliation of Adjusted EBITDA in this
presentation.
|
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SOURCE Heidrick & Struggles
