September 8, 2021 – Korn Ferry (NYSE:KFY) has posted 2021 fiscal reported first quarter revenue of $585.4 million, an increase of 70 percent. This compares to year-ago revenues of $344.1 million. Fee revenue increased in all regions with the largest increase in North America where demand for the company’s products and services exceeded pre-pandemic levels in conjunction with the worldwide economic recovery.
The higher fee revenue was driven by an increase in recruitment process outsourcing (RPO) fee revenue of $43.1 million or 97 percent (87 percent at constant currency) and an increase in professional search fee revenue of $27.6 million or 114 percent (105 percent at constant currency) due to the wider adoption of RPO services in the market and the Korn Ferry’s recovery from the economic impact of COVID-19, which negatively impacted the firm on a worldwide basis in Q1 FY’21.
The Los Angeles-headquartered executive recruiter and leadership consultant – the largest globally and in the Americas as ranked by Hunt Scanlon Media – recorded first quarter diluted earnings per share of $1.37, an all-time high. “I am extremely pleased with our results during the fiscal first quarter, as Korn Ferry once again achieved all-time financial performance highs,” said Gary D. Burnison, CEO of Korn Ferry. “We generated a record $585 million in fee revenue, up 70 percent year over year. Our profitability was also strong with diluted earnings per share at $1.37 and adjusted EBITDA margin at 20.7 percent.”
“The purposeful decisions and moves we’ve made with great intention throughout the years have now come together in a critical mass of opportunity,” Mr. Burnison says. “As a result, today’s Korn Ferry is the right firm for the right time, offering scaled capabilities that include organizational strategy, leadership and professional development, assessment and succession, rewards, talent acquisition and more. From the depth of pandemic lockdowns and economic contractions, we are truly helping clients in this digitally enabled, new world of work. I am grateful for the grit and grace demonstrated by our colleagues who have propelled our firm to new heights.”
During the quarter, Korn Ferry declared a quarterly dividend of $0.12 per share on September 7, 2021, which is payable on October 15, 2021 to stockholders of record on September 23, 2021.
Korn Ferry has experienced a wave of growth in recently months. In July, it named Lauren Shin as vice chairman of its board and CEO services and global consumer practices. She is based in the human capital consultancy’s New York office. “Lauren brings to Korn Ferry an exceptional track record of success, impeccable consumer industry knowledge and relationships at the highest levels,” said Doug Charles, president of Korn Ferry’s global consumer market. “Her understanding of the talent and leadership issues facing today’s senior executives and organizations, and the dramatic shifts impacting today’s workplace will be a great fit for Korn Ferry and our clients.”
In May, Korn Ferry named Alexander Strahl as a senior client partner and co-leader of its EMEA global technology practice. He is based in the firm’s Brussels office. “We are excited to have Alexander´s experience and leadership on board,” said Sonamara Jeffreys, co-president, EMEA, Korn Ferry. “He brings to Korn Ferry and our clients a wealth of international experience and has been a well-trusted advisor to leading private, large public and private equity-backed companies.” Mr. Strahl joins Korn Ferry from Spencer Stuart where he was the technology, media, and telecommunications practice leader in EMEA. Prior to this, he was working for Russell Reynolds Associates and Heidrick & Struggles as a core member of their technology practices.
Korn Ferry also recently appointed Charles Falcone as a senior client partner and global leader of its academic sector recruiting practice, including academic medicine and higher education. Based in Chicago, he also becomes director of the Korn Ferry Physician Leadership Institute. “Charlie has an exceptional reputation in the market and brings extensive advisory and search experience working on the successful recruitment of CEOs, chancellors, deans, presidents, chairs, chief medical officers and board-level assignments for academic institutions, health systems, and health-related associations and societies,” said Gregory Button, president of the firm’s global healthcare services practice. “He will be a great asset to our team.”
Korn Ferry appointed Michael Morcos as vice chairman of the firm’s CEO and board practice in EMEA. He is based between the Dubai and London offices. With more than 20 years of experience in international management consulting, recruiting and executive search, Mr. Morcos brings his expertise to clients on key issues such as board alignment, leadership development, post-merger integration and leadership assessment, and executive search. Mr. Morcos’ clients include global MNCs, ruling families, governments, SWFs, industrial conglomerates, and financial institutions.
Assuming no new major pandemic lockdowns, and that worldwide economic conditions, financial markets and foreign exchange rates remain steady, Korn Ferry foresees on a consolidated basis: Q2 FY’22 fee revenue is expected to be in the range of $585 million and $615 million; and Q2 FY’22 diluted earnings per share is expected to range between $1.30 to $1.44.
Korn Ferry shares have added about 67.8 percent since the beginning of the year versus the S&P 500’s gain of 20.3 percent.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media