February 5, 2019 – Robert Half International Inc./(NYSE:RHI) posted full-year revenues of $5.80 billion, up from $5.27 billion the prior year. The Menlo Park, CA-based recruiting company posted fourth quarter revenues of $1.48 billion, a 10.1 percent increase from the same period last year. The results topped Wall Street forecasts. Four analysts surveyed by Zacks expected $1.46 billion.
For the year, net income was $434.3 million, or $3.57 per share, compared to earnings of $291 million, or $2.33 per share. In the fourth quarter, Robert Half posted earnings of $113.6 million, or 95 cents per share. The results exceeded Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 91 cents per share.
Based on the nature of services, Robert Half has three reportable operating segments, namely Temporary and Consultant Staffing, Permanent Placement Staffing, and Risk Consulting and Internal Audit Services. While revenues from Temporary and Consultant Staffing and Permanent Placement Staffing come under the global staffing division, those from Risk Consulting and Internal Audit Services are reported under the Protiviti division.
Global Staffing Division: Staffing revenues of $1.21 billion increased 7.6 percent year over year on a reported basis and 8.5 percent on an adjusted basis. U.S. staffing revenues of $934 million increased 8.1 percent on a reported basis and 7.1 percent on an adjusted basis. Non-U.S. staffing revenues increased six percent on a reported basis and 13.6 percent on an adjusted basis to $285 million. Robert Half operates 324 staffing locations worldwide, with 85 locations in 17 countries outside the U.S.
Protiviti: Protiviti revenues were $263 million, which increased 22.8 percent year over year on a reported basis and 19.2 percent on an adjusted basis, with strength across both the U.S. and non-U.S. regions. Protiviti revenues from the U.S. grew 17.6 percent on a reported basis and 16.4 percent on an adjusted basis to $204 million. The same from international regions surged 45.1 percent on a reported basis and 29.5 percent on an adjusted basis to $59 million. Protiviti along with its independently-owned member firms has a network of 83 locations in 26 countries.
“We ended the year strongly, with double-digit year-over-year growth in revenues and operating income on both a quarterly and annual basis,” said Harold M. Messmer Jr., chairman and CEO of Robert Half. “Full-year 2018 revenues and operating income reached all-time-high levels for the company, with broad-based strength in our staffing and Protiviti operations.”
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“The U.S. labor market remains very robust, with significant demand due to talent shortages across our professional disciplines,” he said. “”During the fourth quarter, return on invested capital for the company was 42 percent.”
During the fourth quarter, Robert Half bought back 2.4 million shares for $137 million. The company has 6.7 million shares available for repurchase under its repurchase plan as approved by the board of directors. The company also paid a cash dividend of 28 cents per share in December, totaling $34 million.
Robert Half expects first-quarter 2019 revenues in the range of $1.460 to $1.525 billion. The Zacks Consensus Estimate of $1.49 billion falls within the guided range. Earnings are anticipated in the band of 92 to 98 cents per share. The Zacks Consensus Estimate of 94 cents is within the guided range.
Robert Half shares have risen six percent since the beginning of the year, while the Standard & Poor’s 500 index has increased slightly more than five percent. In the final minutes upon the release of its numbers, shares hit $60.72, an increase of slightly more than five percent in the last 12 months.
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