Korn/Ferry International Posts Major Revenue Decline

June 16, 2009 – Korn/Ferry International/(NYSE:KFY) has posted revenues of $107 million for the fourth quarter fiscal 2009, a decrease of 43.5 percent from revenues of $208.2 million a year ago. The firm reported diluted loss per share of $0.45 compared to diluted earnings per share of $0.36 in the fourth quarter last year. Excluding a $25.1 million restructuring charge recorded in the period, diluted loss per share would have been $0.11. North America revenues were $56.8 million, a decrease of 58 percent compared to revenues of $97.9 million a year ago. In EMEA revenues dropped from $50 million to $20.7 million and in Asia Pacific revenues fell from $23.2 million in 2008 to $10.1 million. During the quarter, Korn/Ferry experienced a 36.5 percent decline in the number of executive search engagements opened compared to a year ago and the average fee billed per engagement decreased by 25.2 percent compared to the prior year. The firm previously announced it would incur expenses to further rationalize its costs structure due to the deteriorating labor markets. Therefore in the fourth quarter, the company recorded a $25.1 million restructuring charge with $13.4 million of severance costs related to a reduction in work force, of which approximately $4.9 million was paid in cash during the quarter, and $11.7 million relating to the consolidation of premises. “Although our industry, the global capital markets and most businesses have been under siege since the fall of 2008, Korn/Ferry is successfully navigating this historic global recession. For fiscal 2009, we ended the year with a fortified balance sheet that includes $326 million of cash and marketable securities and we maintained our position as the largest firm in the industry,” said Gary Burnison, CEO of Korn/Ferry. “We have used this tumultuous time to make strides in enhancing our value proposition to clients and to further diversify Korn/Ferry as a true talent management provider.”