Korn Ferry Q3 Revenues Fall Eight Percent
February 22, 2021 – Korn Ferry (NYSE:KFY) has posted fiscal third quarter revenues of $475.4 million, an eight percent decrease from the same period a year ago. While RPO and professional search saw a year-over-year increase of almost four percent, digital and executive search declined year-over-year as those businesses continued on a path to recovery from the impact of COVID-19 on economies around the world. The Los Angeles-headquartered executive recruiter and leadership consultant – the largest globally and in the Americas as ranked by Hunt Scanlon Media – recorded net income was $51.3 million, compared to net income of $20 million in the third quarter of last year.
“Our performance for the fiscal third quarter demonstrates the resilience of our business and continued extension of our brand, with strong sequential fee revenue growth of nine and our earnings and profitability reaching record highs,” said Gary D. Burnison, CEO. “I am incredibly proud of the tireless commitment that all our Korn Ferry colleagues have shown in helping our clients re-imagine their organizational structures, recruit and retain talent and develop their people in the face of extraordinary challenges.”
“In a post-pandemic world, there will continue to be heightened demand for transformational consulting skills and expertise,” Mr. Burnison said. “The steps we have taken to evolve our business into a more efficient, profitable, growth-oriented organization have positioned Korn Ferry to provide our clients with unparalleled expertise, data, and innovation support. With people at the center of our strategy, we are achieving our growth objectives, delivering long-term value creation to shareholders and establishing Korn Ferry as the preeminent global organizational consultancy.”
During the quarter, Korn Ferry repurchased $7.6 million of stock. The search firm also declared a quarterly dividend of $0.10 per share on February 21, 2021 payable on April 15, 2021 to stockholders of record on March 10, 2021.
In January, Korn Ferry 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 the 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.”
During the quarter, Korn Ferry appointed Michael Morcos as vice chairman of the firm’s CEO and board practice in EMEA. He is based between the firm’s 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.
Korn Ferry Launches Virtual Recruiting Technology Solution
Korn Ferry has launched Korn Ferry Recruit, a fully integrated, virtual technology solution for high-volume hiring. Nimble uses best-in-class AI, along with the proven recruitment intellectual property of Korn Ferry. The firm said that the new solution “is designed to leverage a client’s brand, shifting to a candidate-driven experience by sourcing, attracting, assessing and selecting the right people for the job at an affordable cost-per-hire.” It is part of the firm’s line of Nimble solutions.
“Michael is a widely respected leader with vast executive search and consulting experience spanning multiple industries,” said Pascal Gibert, co-president, EMEA, Korn Ferry. “He brings strong passion and fresh perspectives to our firm that will benefit our clients across the EMEA region and our colleagues. Michael will be a key addition to the Korn Ferry team, and we’re thrilled to have him.”
Korn Ferry also recently appointed Henrik Maartensson as a senior leader in the firm’s global private equity and industrial practices. Mr. Maartensson joins Korn Ferry from Spencer Stuart, where he co-led the firm’s EMEA region, bringing his leadership advisory experience to a range of board and C-level engagements for international companies. Previously, he led the firm’s global transformation program and prior to that he served as global practice leader for the firm’s industrial and supply chain practices. “Henrik brings rich experience leading complex engagements while working with a broad scope of private equity and industrial organizations,” said Mr. Gibert. “He is a natural leader and trusted partner whose regional and industry experience will be an invaluable asset to our clients.”
The uncertainty caused by the coronavirus, primarily due to the largescale efforts being taken to contain its continued spread and the number of conflicting and rapidly changing datapoints regarding the impact of the virus on society, has clouded the near-term predictability of Korn Ferry’s business. Revenue and earnings guidance are being reinstated by Korn Ferry starting next fiscal quarter.
A number of equities analysts have issued reports on Korn Ferry. According to MarketBeat, Zacks Investment Research recently cut the firm from a buy rating to a hold rating in a report. Truist raised their price target on Korn Ferry from $34 to $48 in a research report. Robert W. Baird raised Korn Ferry from a neutral rating to an outperform rating and set a $49 price target on the stock in a research report. TheStreet also raised Korn Ferry from a c rating to a b- rating in a research report. Two research analysts have rated the stock with a hold rating and three have assigned a buy rating to the company’s stock..
Shares of Korn Ferry stock opened at $56.59 on Monday. The firm has a market cap of $3.05 billion, a PE ratio of 209.59 and a beta of 1.61. The business’s 50-day simple moving average is $49.14 and its 200-day simple moving average is $37.95. The firm has a debt-to-equity ratio of 0.32, a quick ratio of 2.09 and a current ratio of 2.09. Korn Ferry has a 52-week low of $21.45 and a 52-week high of $57.02.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media