Management Recruiters International, Inc. (MRI) reported Q2 revenues of $13.0 million, a drop of 14.9 compared to last year. The company reported net loss of $0.2 million, or $0.01 per diluted share, versus net income of $4.4 million, or $0.22 per diluted share, during the same period a year ago. “We continue to make progress on the key elements of our transformation. The impact of our initiatives is not yet evident in our financial results, nor do these results reflect the potential of CDI,” said Scott J. Freidheim, chief executive officer and president.
“Our performance improvement program continues, with new talent additions, enhancements to our operating processes and systems, and advances in client service relationships. In addition, we continue to focus our corporate development to access new and complementary sources of profitable growth, and we today announce two transactions.”
CDI anticipates revenue for the third quarter 2015 in the range of $240 million to $250 million. This guidance reflects expected continued weakness in its North American recruiting business.
In separate news, CDI has entered into a definitive agreement to acquire ScaleneWorks People Solutions LLP, a privately held leader in talent acquisition solutions in India. Financial terms of the transaction were not disclosed. Founded in 2010, ScaleneWorks provides enterprise and task recruitment and recruitment process outsourcing (RPO) solutions, as well as other talent analytics and advisory solutions, to multiple leading companies in India. “The acquisition provides CDI with the capability to capitalize on the large and high-growth Indian market, deliver support for the offshore needs of existing CDI clients, and develop a cost-effective offshore delivery capability to serve those clients in CDI’s home markets,” said Scott A. Scanlon, founding chairmen and CEO of Greenwich, Conn-based Hunt Scanlon Media.
“The acquisition of ScaleneWorks represents an important step in our plan to expand selectively our footprint to high growth markets and offer new and existing clients additional value-added services,” said David Arkless, president of CDI International. “ScaleneWorks already has demonstrated its RPO and analytic-based recruitment capabilities with a number of leading global companies. We are excited to welcome the ScaleneWorks team and clients to CDI.”
In other news, CDI and two corporate partners have signed a memorandum of understanding to join forces and deliver sourcing capabilities to Congruent Talent, a newly formed minority-owned company. Congruent Talent, with the support of its corporate partners, will provide U.S. companies with skilled technical and professional IT and engineering talent. Partnering with Congruent Talent will be Acro Service Corp. (Acro), Mastech Inc. and CDI.
CDI will own a 49 percent interest in Congruent Talent — the company is expected to offer a scalable and efficient mechanism for large clients to deliver on skilled talent requirements while meeting their supplier diversity program goals. “Together, we are creating a minority-owned company that will, on day one, offer industry-leading staffing capabilities,” said Mr. Freidheim.
Contributed by Dale M. Zupsansky, Managing Editor, Hunt Scanlon Media