July 13, 2018 – Toronto-based executive search firm Caldwell has posted third quarter revenues of $18 million (Canadian), a 24.2 percent increase from a year ago when the firm recorded revenues of $14.4 million.
During the quarter, U.S. professional fees rose 22.8 percent to $13.5 million (Canadian); however, they increased 28.9 percent excluding the effect of exchange rates. Canadian professional fees rose 10 percent in the third quarter to $3.8 million (Canadian); a higher average fee per assignment and a higher number of assignments per partner were partially offset by a lower average number of partners. Professional fees in Europe rose to $923,000 (Canadian) in the third quarter from $250,000 (Canadian) last year.
“This was an outstanding quarter, bringing the firm to a new high-water mark for revenue,” said John Wallace, CEO. “Our search teams throughout our geographic regions drove strong growth in both search volume and the value of assignments, despite pressure from foreign currency rates. We are especially pleased with the quarterly profit of our U.K. operations.”
Big Growth in Store as Executive Recruiters Slowly Adapt to Automated Technologies
The executive search industry’s leading 50 players in the Americas once again surpassed $3 billion in revenues last year, according to industry newsletter ESR, in a market intelligence briefing just released by Hunt Scanlon Media.
“With the largest level of new bookings and revenue in a single quarter in our history, we are positioned well for the fourth quarter,” he said. “The significant increase in volume and our sustained focus on strategic additions to our partner team is creating search execution support needs, for which we will continue to hire in the fourth quarter.”
During the quarter, the board of directors also declared the payment of a quarterly dividend of two cents per common share payable to holders of common shares of record on July 19 and to be paid on Sept. 13.
In June, Caldwell announced the launch of an offering that pairs clients with agile executive talent on an as-needed basis. The firm describes its new Value Creation Advisory Solutions offering as a unique, flexible and cost-effective approach to creating value and solving core business challenges that require external expertise. It is part of the firm’s broader Agile Talent Solutions platform.
“There is a lot of positive momentum inside our firm right now – our updated brand has been very well received since its debut, and we are excited about the recent expansion of our Agile Talent offering with the launch of our Value Creation Advisory Solution,” Mr. Wallace said. “We have an exceptional team of talented professionals at every level, all working towards a common goal – to provide value to our clients and shareholders – and it shows.”
In an effort to unlock new value creation opportunities, Caldwell pairs clients with external talent on an as-needed basis. In most cases, said the firm, an advisory solution is a more nimble and cost-effective approach than an outside consulting firm or traditional operating partner at a private equity firm. Value Creation Advisory Services assignments can range from pop-up help, requiring one or two “expert advice calls,” or a longer-term engagement involving weekly calls or meetings over an extended period, said the firm. The offering can involve assistance with detailed strategy development, efficient execution or ensuring institutional learning and best practice building, among other areas.
Shares in Caldwell rose 7.27 percent to $1.18 (Canadian) upon release of its results. The company had a market cap of $24.08 million (Canadian).
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Andrew W. Mitchell, Managing Editor – Hunt Scanlon Media