Investor Relations

Press Release

Korn/Ferry International Announces Second Quarter Fiscal 2010 Results of Operations

December 8, 2009
Highlights
- Second quarter fiscal 2010 fee revenue was $140.1 million, an increase of 20% from Q1 FY'10 and a 26% decline from Q2 FY'09.
- Excluding a $2.8 million net restructuring charge recorded in the period, Q2 FY'10 diluted earnings per share was $0.09. Second quarter fiscal 2010 diluted earnings per share was $0.06 compared to diluted earnings per share of $0.30 in Q2 FY'09.
- Cash and marketable securities were $261.2 million at October 31, 2009.

LOS ANGELES, Dec. 8 /PRNewswire-FirstCall/ -- Korn/Ferry International (NYSE: KFY), a premier global provider of talent management solutions, announced second quarter fiscal 2010 diluted earnings per share of $0.09 (excluding a $2.8 million restructuring charge, net of recoveries) compared to diluted earnings per share of $0.30 in Q2 FY'09. Diluted earnings per share was $0.06 including the restructuring charge in Q2 FY'10.

"We are pleased with the sequential increase in fee revenue of 20%, which is double the industry growth rate, during the quarter," said Gary Burnison, Chief Executive Officer. "Although companies continue to maintain lean workforces and the ramp-up for organizational expansion appears long and gradual, the strength of our brand, our systematic approach to client development and service and the caliber of consultants continues to enable us to take market share. Furthermore, we have derived significant benefit from our differentiated model as well as cost reduction initiatives, resulting in an extremely well fortified balance sheet including $261 million in cash and marketable securities."


Financial Results
(dollars in millions, except per share amounts)
                             Second Quarter     Year to Date
                             ---------------   ----------------
                             FY'10    FY'09    FY'10     FY'09
                             ------   ------   ------    ------
Fee revenue                  $140.1   $189.3   $256.9    $395.0
Total revenue                $146.5   $199.7   $269.8    $417.2
Operating income (loss)        $2.3    $21.5   $(22.7)    $45.2
Operating margin                1.6%    11.4%    (8.8)%    11.5%
Net income (loss)              $2.8    $13.6   $(11.5)    $29.5
Basic earnings (loss) per
 share                        $0.06    $0.31   $(0.26)    $0.68
Diluted earnings (loss) per
 share                        $0.06    $0.30   $(0.26)    $0.66

                             Second            Year to
                             Quarter            Date
Adjusted Results (a):         FY'10             FY'10
                             -------           -------
Operating income (loss)        $5.0             $(1.8)
Operating margin                3.6%             (0.7)%
Net income                     $4.3              $2.0
Basic earnings per share      $0.10             $0.05
Diluted earnings per share    $0.09             $0.04
--------------------------
(a)  Adjusted results are non-GAAP financial measures that exclude
     restructuring charges (net of recoveries) of $2.8 million and
     $21.0 million during the three and six months ended October 31,
     2009, respectively (see attached reconciliations).  No
     restructuring costs were incurred during the three and six
     months ended October 31, 2008.

Fee revenue was $140.1 million in Q2 FY'10 compared to $189.3 million in Q2 FY'09, a decrease of 24.6% on a constant currency basis (a decrease of 26.0% including the impact of exchange rates), which reflects the continuing impact of the global economic crisis. During the same period, the number of engagements opened declined 13.9% and the average fee billed per engagement decreased by 1.2% (an increase of 0.9% excluding the impact of exchange rates). Although Q2 FY'10 fee revenue declined in comparison to Q2 FY'09, the global economy continued to show modest signs of improvement during the current quarter and the Company experienced a 20.0% increase in fee revenue compared to Q1 FY'10, primarily due to a 16.1% increase in the number of engagements opened compared to Q1 FY'10.

Compensation and benefits were $102.1 million in Q2 FY'10, a decrease of $27.6 million, or 21.3%, compared to $129.7 million in Q2 FY'09. This decrease is attributable mainly to a reduction in worldwide headcount and a reduction in the variable component of compensation, which is largely due to lower fee revenue and operating results. Changes in exchange rates impacted compensation and benefits in Q2 FY'10 favorably by $1.9 million from Q2 FY'09.

General and administrative expenses were $27.2 million in Q2 FY'10, a decrease of $5.1 million, or 15.8% from $32.3 million in Q2 FY'09. This decrease is attributable to the Company's cost control initiatives. Changes in exchange rates impacted general and administrative expenses in Q2 FY'10 favorably by $0.4 million from Q2 FY'09.

During the quarter, the Company reorganized its go-to-market and operating structure in Europe, Middle East and Africa ("EMEA") region, and as a result incurred restructuring charges in Q2 FY'10 of $7.6 million to reduce the combined work force. This restructuring expense was partially offset by $4.8 million of recoveries from previous restructuring charges resulting in net restructuring costs of $2.8 million in Q2 FY'10.

Excluding the previously mentioned restructuring costs of $2.8 million (net of recoveries), operating income was $5.0 million in Q2 FY'10. Including the restructuring charge, the Company recorded operating income of $2.3 million in Q2 FY'10 compared to operating income of $21.5 million in Q2 FY'09, a decrease of $19.2 million.

Balance Sheet and Liquidity

Cash and marketable securities were $261.2 million at October 31, 2009 compared to $265.9 million at July 31, 2009 and $330.3 million at April 30, 2009. Cash and marketable securities, include $66.4 million, $65.3 million and $60.8 million, held in trust for deferred compensation plans, at October 31, 2009, July 31, 2009 and April 30, 2009, respectively. Cash and marketable securities decreased by $69.1 million in Q2 FY'10 from Q4 FY'09, mainly due to the payment of annual bonuses in Q1 FY'10.

Results by Segment


Selected Executive Recruitment Data
(dollars in millions)

                               Second Quarter      Year to Date
                               ---------------   ----------------
                               FY'10    FY'09    FY'10     FY'09
                               ------   ------   ------    ------
Fee revenue                    $123.3   $160.2   $224.6    $334.8
Total revenue                  $128.3   $167.8   $234.9    $350.7
Operating income (loss)          $9.7    $26.6    $(3.4)    $58.3
Operating margin                  7.8%    16.6%    (1.5)%    17.4%
Ending number of consultants      497      535      497       535
Average number of consultants     499      536      486       529
New engagements (a)             1,578    1,669    2,896     3,589

                               Second            Year to
                               Quarter            Date
Adjusted Results (b):           FY'10            FY'10
                               -------           -------
Operating income                $14.9             $20.0
Operating margin                 12.1%              8.9%
----------------
(a) Represents new engagements opened in the respective period.

(b) Adjusted results are non-GAAP financial measures that exclude
    restructuring charges (net of recoveries) of $5.3 million and
    $23.4 million during the three and six months ended October 31, 2009,
    respectively (see attached reconciliations).  No restructuring costs
    were incurred during the three and six months ended October 31, 2008.

Fee revenue was $123.3 million in Q2 FY'10, a decrease of $36.9 million, or 21.5% on a constant currency basis from $160.2 million in Q2 FY'09 (a decrease of 23.0% including the impact of exchange rates). Fee revenue decreased in all regions due to a 20.7% decrease in the overall number of engagements billed and a decrease of 2.8% in the average fee per engagement billed (a decrease of 0.9% excluding the impact of exchange rates).

Operating income in Q2 FY'10 was $14.9 million, excluding restructuring costs of $5.3 million. Executive recruitment recorded operating income of $9.7 million in Q2 FY'10 including restructuring costs compared to operating income of $26.6 in Q2 FY'09, or a decrease of $16.9 million from the prior year.

The total number of consultants at October 31, 2009 was 497, a decrease of 38 from October 31, 2008.


Selected Futurestep Data
(dollars in millions)

                              Second Quarter     Year to Date
                              --------------    --------------
                              FY'10    FY'09    FY'10    FY'09
                              -----    -----    -----    -----
Fee revenue                   $16.8    $29.1    $32.3    $60.3
Total revenue                 $18.2    $31.9    $34.9    $66.5
Operating income               $2.6     $1.2     $1.8     $4.1
Operating margin               15.5%     4.2%     5.6%     6.8%

                             Second            Year to
                             Quarter            Date
Adjusted Results (a):         FY'10             FY'10
                             -------           -------
Operating income (loss)        $0.1             $(0.7)
Operating margin                0.8%             (2.1)%
-----------------------
(a)  Adjusted results are non-GAAP financial measures that exclude
     recoveries of restructuring charges of $2.5 million during each of
     the three and six months ended October 31, 2009 (see attached
     reconciliations).  No restructuring costs were incurred during the
     three and six month ended October 31, 2008.

Fee revenue was $16.8 million in Q2 FY'10, a decrease of $12.3 million, or 41.5% on a constant currency basis (a decrease of 42.3% including the impact of exchange rates), from $29.1 million in Q2 FY'09. Reductions in fee revenue were driven by a 34.3% decrease in the number of engagements billed and to a lesser extent by an 11.5% decrease in the average fee per engagement billed.

The Q2 FY'10 operating income includes recovery of restructuring costs of $2.5 million, which primarily relates to lower facility lease costs than originally recorded; without which operating income would have been $0.1 million. Operating income was $2.6 million in Q2 FY'10 compared to operating income of $1.2 million in Q2 FY'09.

Outlook

Given the uncertain economic environment and labor markets, making a meaningful prediction about fee revenue and earnings remains challenging; however, assuming constant foreign exchange rates we expect Q3 FY'10 fee revenues will be $130 million to $145 million and diluted earnings per share to be in the range of $0.05 to $0.15.

Earnings Conference Call Webcast

The earnings conference call will be held today at 2:00 PM (EST) and hosted by Gary Burnison, Chief Executive Officer, Mike DiGregorio, Chief Financial Officer and Gregg Kvochak, Vice President of Finance. The conference call will be webcast and available online at www.kornferry.com, accessible through the Investor Relations section.

Korn/Ferry International (NYSE: KFY), with a presence throughout the Americas, Asia Pacific, Europe, the Middle East and Africa, is a premier global provider of talent management solutions. Based in Los Angeles, the firm delivers an array of solutions that help clients to attract, develop, retain and sustain their talent. Visit www.kornferry.com for more information on the Korn/Ferry International family of companies, and www.kornferryinstitute.com for thought leadership, intellectual property and research.

Forward-Looking Statements

Statements in this press release and our conference call that relate to future results and events ("forward-looking statements") are based on Korn/Ferry's current expectations. Readers are cautioned not to place undue reliance on such statements. Actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties that are beyond the control of Korn/Ferry. The potential risks and uncertainties relate to competition, the dependence on attracting and retaining qualified and experienced consultants, the portability of client relationships, local political or economic developments in or affecting countries where we have operations, including fluctuations in exchange rates, risks related to the growth and results of Futurestep, global economic developments, restrictions imposed by off-limits agreements, reliance on information systems, the successful integration of acquired businesses and employment liability risk. For a detailed description of risks and uncertainties that could cause differences, please refer to Korn/Ferry's periodic filings with the Securities and Exchange Commission. Korn/Ferry disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Use of Non-GAAP Financial Measures

This press release contains financial information calculated other than in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). These non-GAAP financial measures include adjusted operating income (loss), operating margin, net income (loss), basic earnings (loss) per share and diluted earnings (loss) per share, adjusted to exclude restructuring charges, net of recoveries.

This non-GAAP disclosure has limitations as an analytical tool, should not be viewed as a substitute for financial information determined in accordance with GAAP, and should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Management believes the presentation of non-GAAP financial measures in this press release provides meaningful supplemental information regarding Korn/Ferry's performance by excluding certain charges that may not be indicative of Korn/Ferry's ongoing operating results. The use of these non-GAAP financial measures facilitate comparisons to Korn/Ferry's historical performance. Korn/Ferry includes these non-GAAP financial measures because management believes it is useful to investors in allowing for greater transparency with respect to supplemental information used by management in its evaluation of Korn/Ferry's ongoing operations and financial and operational decision-making.

[Tables attached]


          KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
            CONSOLIDATED STATEMENTS OF OPERATIONS
           (in thousands, except per share amounts)

                               Three Months Ended    Six Months Ended
                                   October 31,         October 31,
                               ------------------  -------------------
                                 2009      2008      2009       2008
                               --------  --------  --------   --------
                                            (unaudited)
Fee revenue                    $140,145  $189,300  $256,948   $395,033
Reimbursed out-of-pocket
 engagement expenses              6,411    10,437    12,896     22,176
                               --------  --------  --------   --------
    Total revenue               146,556   199,737   269,844    417,209
                               --------  --------  --------   --------

Compensation and benefits       102,076   129,748   192,461    271,871
General and administrative
 expenses                        27,164    32,323    55,218     66,353
Out-of-pocket engagement
 expenses                         9,464    13,297    18,253     28,030
Depreciation and amortization     2,860     2,881     5,689      5,713
Restructuring charges             2,774         -    20,957          -
                               --------  --------  --------   --------
    Total operating expenses    144,338   178,249   292,578    371,967
                               --------  --------  --------   --------

Operating income (loss)           2,218    21,488   (22,734)    45,242

Interest and other income
 (loss), net                      1,180    (1,184)    4,471       (804)
                               --------  --------  --------   --------
     Income (loss) before
      provision (benefit)
      for income taxes
      and equity in earnings
      of unconsolidated
      subsidiaries                3,398    20,304   (18,263)    44,438
Provision (benefit) for
 income taxes                       879     7,583    (6,486)    16,876
Equity in earnings of
 unconsolidated
 subsidiaries, net                  226       839       249      1,902
                               --------  --------  --------   --------
     Net income (loss)           $2,745   $13,560  $(11,528)   $29,464
                               ========  ========  ========   ========

Earnings (loss) per common
 share:
   Basic                          $0.06     $0.31    $(0.26)     $0.68
                               ========  ========  ========   ========
   Diluted                        $0.06     $0.30    $(0.26)     $0.66
                               ========  ========  ========   ========

Weighted-average common
 shares outstanding:
   Basic                         44,470    43,776    44,123     43,604
                               ========  ========  ========   ========
   Diluted                       45,291    44,676    44,123     44,590
                               ========  ========  ========   ========


            KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS
                  EXCLUDING NON-GAAP ADJUSTMENTS
           (in thousands, except per share amounts)
                            (unaudited)

                                             Three Months Ended
                                              October 31, 2009
                                 ----------------------------------------
                                 As Reported    Adjustments   As Adjusted
                                 -----------    -----------   -----------

Fee revenue                         $140,145                     $140,145
Reimbursed out-of-pocket
 engagement expenses                   6,411                        6,411
                                    --------                     --------
    Total revenue                    146,556                      146,556
                                    --------                     --------

Compensation and benefits            102,076                      102,076
General and administrative
 expenses                             27,164                       27,164
Out-of-pocket engagement
 expenses                              9,464                        9,464
Depreciation and amortization          2,860                        2,860
Restructuring charges                  2,774         (2,774)            -
                                    --------         ------      --------
    Total operating expenses         144,338         (2,774)      141,564
                                    --------         ------      --------

Operating income (loss)                2,218          2,774         4,992

Interest and other income,
 net                                   1,180                        1,180
                                    --------                     --------
    Income (loss) before
     provision (benefit) for
     income taxes
     and equity in earnings of
     unconsolidated subsidiaries       3,398          2,774         6,172
Provision (benefit) for
 income taxes (1)                        879          1,260         2,139
Equity in earnings of
 unconsolidated subsidiaries,
 net                                     226                          226
                                    --------                     --------
    Net income (loss)                 $2,745         $1,514        $4,259
                                    ========         ======      ========

Earnings (loss) per common
 share:
  Basic                                $0.06                        $0.10
                                    ========                     ========
  Diluted                              $0.06                        $0.09
                                    ========                     ========

Weighted-average common
 shares outstanding:
  Basic                               44,470                       44,470
                                    ========                     ========
  Diluted                             45,291                       45,291
                                    ========                     ========



                                            Six Months Ended
                                            October 31, 2009
                                 ----------------------------------------
                                 As Reported    Adjustments   As Adjusted
                                 -----------    -----------   -----------

Fee revenue                         $256,948                     $256,948
Reimbursed out-of-pocket
 engagement expenses                  12,896                       12,896
                                    --------                     --------
    Total revenue                    269,844                      269,844
                                    --------                     --------

Compensation and benefits            192,461                      192,461
General and administrative
 expenses                             55,218                       55,218
Out-of-pocket engagement
 expenses                             18,253                       18,253
Depreciation and amortization          5,689                        5,689
Restructuring charges                 20,957        (20,957)            -
                                    --------        -------      --------
    Total operating expenses         292,578        (20,957)      271,621
                                    --------        -------      --------

Operating income (loss)              (22,734)        20,957        (1,777)

Interest and other income,
 net                                   4,471                        4,471
                                    --------                     --------
    Income (loss) before
     provision (benefit) for
     income taxes and equity
     in earnings of
     unconsolidated
     subsidiaries                    (18,263)        20,957         2,694
Provision (benefit) for
 income taxes (1)                     (6,486)         7,442           956
Equity in earnings of
 unconsolidated
 subsidiaries, net                       249                          249
                                    --------                     --------
    Net income (loss)               $(11,528)       $13,515        $1,987
                                    ========        =======      ========

Earnings (loss) per
 common share:
  Basic                               $(0.26)                       $0.05
                                    ========                     ========
  Diluted                             $(0.26)                       $0.04
                                    ========                     ========

Weighted-average common
 shares outstanding:
  Basic                               44,123                       44,123
                                    ========                     ========
  Diluted                             44,123                       44,824
                                    ========                     ========

Explanation of Non-GAAP Adjustments
-----------------------------------
For the three and six months ended October 31, 2009:
(1) Tax effect related to net operating expense adjustments


         KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
                FINANCIAL SUMMARY BY SEGMENT
                     (in thousands)
                       (unaudited)

                                        Three Months Ended
                                            October 31,
                                    ---------------------------
                                      2009               2008
                                    --------           --------
Fee Revenue:
Executive recruitment:
  North America                      $68,230            $91,697
  EMEA                                35,376             40,486
  Asia Pacific                        13,563             21,187
  South America                        6,122              6,828
                                    --------           --------
Total executive recruitment          123,291            160,198
Futurestep                            16,854             29,102
                                    --------           --------
  Total fee revenue                  140,145            189,300
Reimbursed out-of-pocket engagement
 expenses                              6,411             10,437
                                    --------           --------
  Total revenue                     $146,556           $199,737
                                    ========           ========


Adjusted Operating Income (Loss):
 (Excluding Restructuring Charges)             Margin             Margin
                                               ------             ------
Executive recruitment:
  North America                      $11,250     16.5%  $16,197     17.7%
  EMEA                                 2,411      6.8%    5,910     14.6%
  Asia Pacific                            61      0.4%    3,267     15.4%
  South America                        1,202     19.6%    1,214     17.8%
                                    --------           --------
Total executive recruitment           14,924     12.1%   26,588     16.6%
Futurestep                               141      0.8%    1,221      4.2%
Corporate (1)                        (10,073)            (6,321)
                                    --------           --------
  Total adjusted operating income
   (loss)                             $4,992      3.6%  $21,488     11.4%
                                    ========           ========


Restructuring Charges:
Executive recruitment:
  North America                      $(1,279)    (1.9%)      $-      0.0%
  EMEA                                 6,615     18.7%        -      0.0%
  Asia Pacific                            87      0.6%        -      0.0%
  South America                         (173)    (2.9%)       -      0.0%
                                    --------           --------
Total executive recruitment            5,250      4.3%        -      0.0%
Futurestep                            (2,476)   (14.7%)       -      0.0%
Corporate                                  -                  -
                                    --------           --------
  Total restructuring charges         $2,774      2.0%       $-      0.0%
                                    ========           ========


Operating Income (Loss):                       Margin             Margin
                                               ------             ------
Executive recruitment:
  North America                      $12,529     18.4%  $16,197     17.7%
  EMEA                                (4,204)   (11.9%)   5,910     14.6%
  Asia Pacific                           (26)    (0.2%)   3,267     15.4%
  South America                        1,375     22.5%    1,214     17.8%
                                    --------           --------
Total executive recruitment            9,674      7.8%   26,588     16.6%
Futurestep                             2,617     15.5%    1,221      4.2%
Corporate (1)                        (10,073)            (6,321)
                                    --------           --------
  Total operating income (loss)       $2,218      1.6%  $21,488     11.4%
                                    ========           ========



                                           Six Months Ended
                                              October 31,
                                    ---------------------------
                                      2009               2008
                                    --------           --------

Fee Revenue:
Executive recruitment:
  North America                     $123,522           $185,671
  EMEA                                64,597             92,076
  Asia Pacific                        25,934             42,590
  South America                       10,567             14,413
                                    --------           --------
Total executive recruitment          224,620            334,750
Futurestep                            32,328             60,283
                                    --------           --------
  Total fee revenue                  256,948            395,033
Reimbursed out-of-pocket engagement
 expenses                             12,896             22,176
                                    --------           --------
  Total revenue                     $269,844           $417,209
                                    ========           ========


Adjusted Operating Income (Loss):
 (Excluding Restructuring Charges)             Margin             Margin
                                               ------             ------
Executive recruitment:
  North America                      $15,457     12.5%  $34,834     18.8%
  EMEA                                 2,974      4.6%   14,396     15.6%
  Asia Pacific                         1,036      4.0%    6,743     15.8%
  South America                          516      4.9%    2,294     15.9%
                                    --------           --------
Total executive recruitment           19,983      8.9%   58,267     17.4%
Futurestep                              (674)    (2.1%)   4,076      6.8%
Corporate (1)                        (21,086)           (17,101)
                                    --------           --------
  Total adjusted operating income
   (loss)                            $(1,777)    (0.7%) $45,242     11.5%
                                    ========           ========


Restructuring Charges:
Executive recruitment:
  North America                      $(1,279)    (1.0%)      $-      0.0%
  EMEA                                24,798     38.4%        -      0.0%
  Asia Pacific                            87      0.3%        -      0.0%
  South America                         (173)    (1.6%)       -      0.0%
                                    --------           --------
Total executive recruitment           23,433     10.4%        -      0.0%
Futurestep                            (2,476)    (7.7%)       -      0.0%
Corporate                                  -                  -
                                    --------           --------
  Total restructuring charges        $20,957      8.1%       $-      0.0%
                                    ========           ========


Operating Income (Loss):                       Margin             Margin
                                               ------             ------
Executive recruitment:
  North America                      $16,736     13.5%  $34,834     18.8%
  EMEA                               (21,824)   (33.8%)  14,396     15.6%
  Asia Pacific                           949      3.7%    6,743     15.8%
  South America                          689      6.5%    2,294     15.9%
                                    --------           --------
Total executive recruitment           (3,450)    (1.5%)  58,267     17.4%
Futurestep                             1,802      5.6%    4,076      6.8%
Corporate (1)                        (21,086)           (17,101)
                                    --------           --------
  Total operating income (loss)     $(22,734)    (8.8%) $45,242     11.5%
                                    ========           ========

(1) Increase primarily due to $3.1 million and $2.7 million in expenses
    related to the change in amounts due under deferred compensation
    plans determined by an increase (or decrease) in market values,
    during the three and six months ended October 31, 2009, respectively.


              KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
                    CONSOLIDATED BALANCE SHEETS
              (in thousands, except per share amounts)

                                                   October 31,  April 30,
                                                       2009       2009
                                                   -----------  --------
ASSETS                                             (unaudited)
------
Cash and cash equivalents                             $182,938  $255,000
Marketable securities                                    3,783     4,263
Receivables due from clients, net of allowance for
 doubtful accounts of $7,520 and $11,197,
 respectively                                          101,311    67,308
Income taxes and other receivables                       8,066     9,001
Deferred income taxes                                   19,942    14,583
Prepaid expenses and other assets                       29,306    21,442
                                                      --------  --------
    Total current assets                               345,346   371,597
                                                      --------  --------

Marketable securities, non-current                      74,518    70,992
Property and equipment, net                             26,578    27,970
Cash surrender value of company owned life insurance
 policies, net of loans                                 65,528    63,108
Deferred income taxes                                   46,894    45,141
Goodwill                                               164,936   133,331
Intangible assets, net                                  21,792    16,928
Investments and other assets                            15,777    11,812
                                                      --------  --------
    Total assets                                      $761,369  $740,879
                                                      ========  ========

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Accounts payable                                        $8,904   $10,282
Income taxes payable                                    10,677     2,059
Compensation and benefits payable                       88,065   116,705
Other accrued liabilities                               50,418    44,301
                                                      --------  --------
    Total current liabilities                          158,064   173,347
                                                      --------  --------

Deferred compensation and other retirement plans       115,833    99,238
Other liabilities                                       13,104     9,195
                                                      --------  --------
    Total liabilities                                  287,001   281,780

Stockholders' equity
  Common stock: $0.01 par value, 150,000 shares
   authorized, 57,404 and 56,185 shares issued
   and 45,760 and 44,729 shares outstanding,
   respectively                                        376,964   368,430
  Retained earnings                                     73,394    84,922
  Accumulated other comprehensive income, net           24,544     6,285
                                                      --------  --------
    Stockholders' equity                               474,902   459,637
  Less:  notes receivable from stockholders               (534)     (538)
                                                      --------  --------
    Total stockholders' equity                         474,368   459,099
                                                      --------  --------
    Total liabilities and stockholders' equity        $761,369  $740,879
                                                      ========  ========

SOURCE Korn/Ferry International

Investor Relations, Gregg Kvochak, +1-310-556-8550, or Media, Mike Distefano, +1-310-843-4199, both of Korn/Ferry International

Take a Closer Look