Heidrick Posts Revenue Gains; Europe Stays Weak

November 3, 2010 – Chicago-based executive search firm Heidrick & Struggles International/(NASDAQ:HSII) has posted net revenue of $126.1 million for the third quarter ended September 30, 2010, an increase of 21.6 percent from $103.5 million a year ago. Net revenue increased 30.7 percent in the Americas, declined 11.6 percent in Europe (approximately five percent on a constant currency basis), and increased 50.3 percent in the Asia Pacific region (approximately 45 percent on a constant currency basis). Net income was $1.2 million and diluted earnings per share were $0.07, compared to earnings of $4.4 million, or 25 cents a share, during the same period last year. The number of consultants (executive search and leadership consulting) as of September 30, 2010 was 343, compared to 365 at September 30, 2009. Productivity, as measured by annualized net revenue per consultant, increased to $1.5 million from $1.1 million in the 2009 third quarter. The number of executive search confirmations in the quarter increased 3.5 percent compared to the 2009 third quarter, but decreased 5.9 percent compared to the 2010 second quarter. The average revenue per executive search jumped to $114,200 from $97,300 in the 2009 third quarter. Year-over-year revenue growth was driven by recruiting activity in the financial services, industrial, and global technology & services practices as well as by activity in the firm’s leadership consulting business. Performance in Europe continued to plague the firm, however; “we are fighting a slow economic recovery coupled with a disproportionate number of consultant departures” in the region, said CEO L. Kevin Kelly. “Improving our business in Europe will be a primary focus of the management team in the coming months."

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