PRESS RELEASE
Published on June 6, 2007
EXHIBIT 99.1
For Immediate Release
Contacts: For investors:
Gary Burnison (310) 226-2613
For media:
Anneli Ballard (212) 984-9350
Korn/Ferry International Completes a Record Year
Highlights
| | Fourth quarter fiscal 2007 fee revenue was a record $179.7 million, an increase of $34.4 million, or 24%, from $145.3 million in the same quarter last year. |
| | Adjusted fourth quarter fiscal 2007 diluted earnings per share was $0.37, an increase of 19% over Q406 adjusted diluted earnings per share of $0.31. Q407 GAAP diluted earnings per share was $0.30 compared to $0.45 in the prior year fourth quarter. Adjusted fourth quarter results exclude the impact of certain non-GAAP measures as shown in the table on Page 2. |
Los Angeles, CA, June 6, 2007Korn/Ferry International (NYSE:KFY), a premier global provider of talent management solutions, announced fourth quarter fiscal 2007 diluted earnings per share of $0.30 compared to $0.45 in Q406. Excluding the impact of SFAS 123(R), and previously announced one-time charges in the current quarter, diluted earnings per share was $0.37, and excluding a tax benefit, Q406 diluted earnings per share was $0.31.
I am so proud of all of our lines of business for this record year of both revenues and profits, said Paul C. Reilly, Chairman and CEO, Korn/Ferry. Korn/Ferry has had an outstanding reputation over the past four decades, but I believe that it will be Fiscal 2007 which will mark the place in time where the company truly evolved from not only a great search firm but also a unique and diversified talent management provider.
Financial Results
(dollars in millions, except per share amounts)
| Fourth Quarter | Year Ended | |||||||||||||||
| Q407 | Q406 | 2007 | 2006 | |||||||||||||
| Fee Revenue |
$ | 179.7 | $ | 145.3 | $ | 653.4 | $ | 522.9 | ||||||||
| Revenue |
$ | 189.8 | $ | 152.9 | $ | 689.2 | $ | 551.8 | ||||||||
| Operating Income |
$ | 19.4 | $ | 20.6 | $ | 82.3 | $ | 76.2 | ||||||||
| Operating Margin |
10.8 | % | 14.2 | % | 12.6 | % | 14.6 | % | ||||||||
| Net Income |
$ | 13.5 | $ | 20.3 | $ | 55.5 | $ | 59.4 | ||||||||
| Diluted Earnings Per Share |
$ | 0.30 | $ | 0.45 | $ | 1.24 | $ | 1.32 | ||||||||
| Reconciliation of GAAP Net Income to Adjusted Results* |
||||||||||||||||
| Net Income, GAAP |
$ | 13.5 | $ | 20.3 | $ | 55.5 | $ | 59.4 | ||||||||
| Reconciling Income Items, Net of Taxes: |
||||||||||||||||
| SFAS 123 (R) Expense |
$ | 0.8 | | $ | 3.6 | | ||||||||||
| Employment Contract Changes |
$ | 3.3 | | $ | 3.3 | | ||||||||||
| Reversal of Lease Reserve |
($ | 0.4 | ) | | ($ | 0.4 | ) | | ||||||||
| Loss Recovery on Investment |
| | | ($ | 4.5 | ) | ||||||||||
| One-Time Tax Benefit, Net |
| ($ | 6.5 | ) | | ($ | 6.5 | ) | ||||||||
| Adjusted Results: |
||||||||||||||||
| Net Income |
$ | 17.2 | $ | 13.8 | $ | 62.0 | $ | 48.4 | ||||||||
| Operating Margin |
14.0 | % | 14.2 | % | 14.2 | % | 14.6 | % | ||||||||
| Diluted Earnings Per Share |
$ | 0.37 | $ | 0.31 | $ | 1.38 | $ | 1.09 | ||||||||
| * | Adjusted Q407 results, net of taxes, exclude the effect of SFAS 123(R), which was implemented in Q107, a $3.3 million charge for employment contract changes and a $0.4 million reversal of a previously established lease restructuring reserve. Adjusted 2006 results, net of taxes, exclude the effect of a $4.5 million loss recovery on an investment sold by the Company in Q306 and a net $6.5 million one-time tax benefit recorded in Q406. These are non-GAAP measures that the Companys management believes provide useful information regarding the ongoing results of operations because they have been prepared on a basis comparable to that used in prior periods. These measures are not intended to replace Net Income or EPS measured in accordance with U.S. Generally Accepted Accounting Principles (see attached reconciliation). |
Fee revenue of $179.7 million in Q407 increased $34.4 million, or 24% (19% on a constant currency basis), from $145.3 million in Q406. Fee revenue improved globally due to an increase in revenues from all segments of the business with an increase in the number of search engagements opened as well as an 18% increase in the average fee billed per executive search engagement compared to the prior year. Exchange rates impacted fee revenue in Q407 favorably by $6.9 million compared to Q406.
Excluding the $4.5 million unfavorable impact of exchanges rates, a $5.2 million charge for executive employment contract changes and the SFAS 123(R) impact of $1.1 million compensation and benefits were $118.0 million in Q407, an increase of $22.9 million, or 24%, compared to $95.1 million in Q406. The increase is primarily attributable to profitability based compensation and, to a lesser extent, higher headcount in all segments of the Company. Actual compensation and benefits for Q407 was $128.8 million compared to $95.1 million in Q406, an increase of 35%.
Excluding the $1.1 million unfavorable impact of exchange rates, general and administrative expenses of $24.8 million in Q407 decreased by $0.6 million, or 2%, from $25.4 million in Q406 as an increase in business volume was offset by cost control efforts. Actual general and administrative expenses were $25.9 million in Q407 compared to $25.4 in Q406, an increase of 2%.
Excluding the previously announced one-time charges and the impact of SFAS 123(R) operating income was $25.1 million in Q407 compared to $20.6 million in Q406, an increase of 22%. Actual operating income was $19.4 million in Q407, a decrease of $1.2 million or 6%, over Q406. Adjusted for the effect of the one-time charges and SFAS 123(R), operating margin for the quarter was 14.0%.
Balance Sheet and Liquidity
Cash, cash equivalents and marketable securities were $324.3 million at April 30, 2007 compared to $278.2 million at April 30, 2006. The increase was due primarily to improved operating cash flows.
Through April 30, 2007, the Company has used approximately $75 million of the $125 million of share repurchase funds, authorized by the Board of Directors in December 2005, June 2006 and March 2007, to buy back approximately 3.56 million shares.
Interest expense was $2.5 million in Q407 compared to $2.7 million in the same period last year. Interest expense in both years related primarily to borrowings under Korn/Ferrys convertible securities and COLI policies. The decrease in interest expense is primarily due to the conversion of all of the Companys convertible securities to common shares during Q407. At April 30, 2007, Korn/Ferry had no outstanding borrowings under its credit facility.
Results by Segment
Selected Executive Recruitment Data
(dollars in millions)
| Fourth Quarter | Year Ended | |||||||||||||||
| Q407 | Q406 | 2007 | 2006 | |||||||||||||
| Fee Revenue |
$ | 157.1 | $ | 126.7 | $ | 567.6 | $ | 452.7 | ||||||||
| Revenue |
$ | 164.2 | $ | 132.7 | $ | 594.9 | $ | 474.9 | ||||||||
| Operating Income |
$ | 31.3 | $ | 29.4 | $ | 111.9 | $ | 100.7 | ||||||||
| Operating Margin |
19.9 | % | 23.2 | % | 19.7 | % | 22.2 | % | ||||||||
| Average number of consultants |
488 | 438 | 465 | 419 | ||||||||||||
| Engagements (a) |
1,797 | 1,750 | 6,894 | 6,291 | ||||||||||||
| (a) | Represents new engagements opened in the respective period. |
Fee revenue was $157.1 million in Q407, an increase of $30.4 million, or 24.0%, from $126.7 million in Q406. Fee revenue improved in all regions due to an increase in the overall number of engagements and average fee per engagement.
Excluding the $1.1 million effect of SFAS 123(R), operating income was $32.4 million, an increase of $3.0 million, or 10.2%, over the prior year. Actual operating income improved $1.9 million in Q407, or 6.5%, to $31.3 million compared to $29.4 million in Q406.
The total number of consultants at April 30, 2007 was 490, an increase of 50 from April 30, 2006.
Selected Futurestep Data
(dollars in millions)
| Fourth Quarter | Year Ended | |||||||||||||||
| Q407 | Q406 | 2007 | 2006 | |||||||||||||
| Fee Revenue |
$ | 22.6 | $ | 18.6 | $ | 85.8 | $ | 70.2 | ||||||||
| Revenue |
$ | 25.5 | $ | 20.3 | $ | 94.3 | $ | 76.8 | ||||||||
| Operating Income (Loss) |
$ | 2.7 | ($ | 1.4 | ) | $ | 7.9 | $ | 3.4 | |||||||
| Operating Margin |
11.9 | % | (7.8 | %) | 9.2 | % | 4.8 | % | ||||||||
Fee revenue was $22.6 million in Q407, an increase of $4.0 million, or 21.5%, from $18.6 million in Q406. Improvements in fee revenue were driven by an increase in the average fee for engagements.
Excluding a $0.9 million reversal of a previously recorded lease reserve, operating income was $1.8 million in Q407 resulting in an operating margin of 8.1%. Actual operating income was $2.7 million in Q407, an increase of $4.1 million from an operating loss of $1.4 million in Q406. Operating margin for the quarter increased to 11.9% from an operating loss in the same quarter a year ago.
Outlook
Assuming constant foreign exchange rates, Korn/Ferry estimates that first quarter fiscal 2008 fee revenue is likely to be in the range of $176 million to $185 million and diluted earnings per share is likely to be in the range of $0.34 to $0.36.
Earnings Conference Call Webcast
The earnings conference call will be held today at 9:00 AM (EDT) and hosted by Paul C. Reilly, Chairman and CEO, and Gary Burnison, Chief Operating Officer. 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 more than 70 offices in 40 countries, is a premier global provider of talent management solutions. Based in Los Angeles, the firm delivers an array of solutions that help clients to identify, deploy, develop, retain and reward their talent. For more information on the Korn/Ferry International family of companies, visit www.kornferry.com.
Statements in this press release and our conference call that relate to future results and events (forward-looking statements) are based on Korn/Ferrys 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 which 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, risks related to the growth and results of Futurestep, restrictions imposed by off-limits agreements, reliance on information systems and employment liability risk. For a detailed description of risks and uncertainties that could cause differences, please refer to Korn/Ferrys 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.
[Tables attached]
KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
| Three Months Ended April 30, |
Year Ended April 30, |
||||||||||||
| 2007 | 2006 | 2007 | 2006 | ||||||||||
| Fee revenue |
$ | 179,702 | $ | 145,266 | $ | 653,422 | $ | 522,882 | |||||
| Reimbursed out-of-pocket engagement expenses |
10,058 | 7,658 | 35,779 | 28,887 | |||||||||
| Total revenue |
189,760 | 152,924 | 689,201 | 551,769 | |||||||||
| Compensation and benefits |
128,840 | 95,096 | 447,692 | 341,196 | |||||||||
| General and administrative expense |
25,881 | 25,428 | 105,312 | 93,462 | |||||||||
| Out-of-pocket engagement expenses |
13,622 | 9,358 | 44,662 | 31,927 | |||||||||
| Depreciation and amortization |
2,066 | 2,405 | 9,280 | 9,002 | |||||||||
| Total operating expense |
170,409 | 132,287 | 606,946 | 475,587 | |||||||||
| Operating income |
19,351 | 20,637 | 82,255 | 76,182 | |||||||||
| Interest and other income (expense), net |
533 | (434 | ) | 244 | 842 | ||||||||
| Income before provision for income taxes and equity in earnings of unconsolidated subsidiaries |
19,884 | 20,203 | 82,499 | 77,024 | |||||||||
| Provision for income taxes |
6,980 | 430 | 30,164 | 19,594 | |||||||||
| Equity in earnings of unconsolidated subsidiaries, net |
635 | 527 | 3,163 | 2,000 | |||||||||
| Net income |
$ | 13,539 | $ | 20,300 | $ | 55,498 | $ | 59,430 | |||||
| Interest expense on convertible securities, net of taxes |
509 | 759 | 2,863 | 3,113 | |||||||||
| Net income adjusted for computation of diluted EPS |
$ | 14,048 | $ | 21,059 | $ | 58,361 | $ | 62,543 | |||||
| Basic earnings per common share |
$ | 0.33 | $ | 0.51 | $ | 1.40 | $ | 1.49 | |||||
| Basic weighted average common shares outstanding |
41,408 | 39,874 | 39,774 | 39,889 | |||||||||
| Diluted earnings per common share |
$ | 0.30 | $ | 0.45 | $ | 1.24 | $ | 1.32 | |||||
| Diluted weighted average common shares outstanding |
47,252 | 47,209 | 46,938 | 47,270 | |||||||||
KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
FINANCIAL SUMMARY BY SEGMENT
(in thousands)
| Three Months Ended April 30, |
Year Ended April 30, |
|||||||||||||||||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||||||||||||||||
| Fee Revenue: |
||||||||||||||||||||||||||||
| Executive recruitment: |
||||||||||||||||||||||||||||
| North America |
$ | 91,398 | $ | 70,237 | $ | 329,065 | $ | 259,089 | ||||||||||||||||||||
| Europe |
41,277 | 36,258 | 146,155 | 120,059 | ||||||||||||||||||||||||
| Asia/Pacific |
19,818 | 15,981 | 74,987 | 57,922 | ||||||||||||||||||||||||
| South America |
4,649 | 4,210 | 17,426 | 15,660 | ||||||||||||||||||||||||
| Total executive recruitment |
157,142 | 126,686 | 567,633 | 452,730 | ||||||||||||||||||||||||
| Futurestep |
22,560 | 18,580 | 85,789 | 70,152 | ||||||||||||||||||||||||
| Total fee revenue |
179,702 | 145,266 | 653,422 | 522,882 | ||||||||||||||||||||||||
| Reimbursed out-of-pocket engagement expenses |
10,058 | 7,658 | 35,779 | 28,887 | ||||||||||||||||||||||||
| Total revenue |
$ | 189,760 | $ | 152,924 | $ | 689,201 | $ | 551,769 | ||||||||||||||||||||
| Operating Income (Loss): | Margin | Margin | Margin | Margin | ||||||||||||||||||||||||
| Executive recruitment: |
||||||||||||||||||||||||||||
| North America |
$ | 18,529 | 20 | % | $ | 17,458 | 25 | % | $ | 69,815 | 21 | % | $ | 62,124 | 24 | % | ||||||||||||
| Europe |
6,775 | 16 | % | 6,296 | 17 | % | 24,166 | 17 | % | 22,361 | 19 | % | ||||||||||||||||
| Asia/Pacific |
5,401 | 27 | % | 4,742 | 30 | % | 16,010 | 21 | % | 13,374 | 23 | % | ||||||||||||||||
| South America |
565 | 12 | % | 951 | 23 | % | 1,894 | 11 | % | 2,839 | 18 | % | ||||||||||||||||
| Total executive recruitment |
31,270 | 20 | % | 29,447 | 23 | % | 111,885 | 20 | % | 100,698 | 22 | % | ||||||||||||||||
| Futurestep |
2,713 | 12 | % | (1,442 | ) | (8 | %) | 7,854 | 9 | % | 3,351 | 5 | % | |||||||||||||||
| Corporate |
(14,632 | ) | (7,368 | ) | (37,484 | ) | (27,867 | ) | ||||||||||||||||||||
| Total operating income |
$ | 19,351 | 11 | % | $ | 20,637 | 14 | % | $ | 82,255 | 13 | % | $ | 76,182 | 15 | % | ||||||||||||
KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
| As of April 30, | ||||||||
| 2007 | 2006 | |||||||
| ASSETS |
||||||||
| Cash and cash equivalents |
$ | 289,106 | $ | 257,543 | ||||
| Marketable securities |
35,161 | 20,654 | ||||||
| Receivables due from clients, net of allowance for doubtful accounts of $9,822 and $11,880, respectively |
107,751 | 87,287 | ||||||
| Income taxes and other receivables |
6,357 | 5,328 | ||||||
| Deferred income taxes |
9,524 | 9,669 | ||||||
| Prepaid expenses |
16,861 | 14,019 | ||||||
| Total current assets |
464,760 | 394,500 | ||||||
| Property and equipment, net |
25,999 | 20,533 | ||||||
| Cash surrender value of company owned life insurance policies, net of loans |
76,478 | 70,592 | ||||||
| Deferred income taxes |
42,013 | 32,267 | ||||||
| Goodwill and intangible assets, net |
142,308 | 109,484 | ||||||
| Deferred financing costs, investments and other |
9,933 | 8,115 | ||||||
| Total assets |
$ | 761,491 | $ | 635,491 | ||||
| LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
| Accounts payable |
$ | 10,383 | $ | 9,731 | ||||
| Income taxes payable |
22,432 | 17,138 | ||||||
| Compensation and benefits payable |
158,145 | 121,885 | ||||||
| Other accrued liabilities |
38,529 | 27,537 | ||||||
| Total current liabilities |
229,489 | 176,291 | ||||||
| Deferred compensation and other retirement plans |
91,360 | 71,790 | ||||||
| Long-term debt |
| 45,147 | ||||||
| Other liabilities |
7,687 | 7,523 | ||||||
| 7.5% Convertible mandatorily redeemable preferred stock, net of unamortized discount and issuance costs, redemption value of $0 and $11,387, respectively |
| 10,989 | ||||||
| Total liabilities |
328,536 | 311,740 | ||||||
| Shareholders equity |
||||||||
| Common stock: $0.01 par value, 150,000 shares authorized, 52,323 and 43,628 shares issued and 47,174 and 41,201 shares outstanding, respectively |
400,126 | 344,285 | ||||||
| Retained earnings (deficit) |
32,344 | (23,154 | ) | |||||
| Unearned restricted stock compensation |
(19,567 | ) | (7,731 | ) | ||||
| Accumulated other comprehensive income |
20,605 | 10,910 | ||||||
| Shareholders equity |
433,508 | 324,310 | ||||||
| Less: Notes receivable from shareholders |
(553 | ) | (559 | ) | ||||
| Total shareholders equity |
432,955 | 323,751 | ||||||
| Total liabilities and shareholders equity |
$ | 761,491 | $ | 635,491 | ||||
KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
EXCLUDING NON-GAAP ADJUSTMENTS
(in thousands, except per share amounts)
(unaudited)
| Three Months Ended April 30, |
|||||||||||||||||||
| 2007 - As Reported |
Adjustments | 2007 - As Adjusted |
2006 - As Reported |
Adjustments | 2006 - As Adjusted |
||||||||||||||
| Fee revenue |
$ | 179,702 | $ | 179,702 | $ | 145,266 | $ | 145,266 | |||||||||||
| Reimbursed out-of-pocket engagement expenses |
10,058 | 10,058 | 7,658 | 7,658 | |||||||||||||||
| Total revenue |
189,760 | 189,760 | 152,924 | 152,924 | |||||||||||||||
| Compensation and benefits (1), (2) |
128,840 | (1,152 | ) | 122,501 | 95,096 | 95,096 | |||||||||||||
| (5,187 | ) | ||||||||||||||||||
| General and administrative expense (3) |
25,881 | 606 | 26,487 | 25,428 | 25,428 | ||||||||||||||
| Out-of-pocket engagement expenses |
13,622 | 13,622 | 9,358 | 9,358 | |||||||||||||||
| Depreciation and amortization |
2,066 | 2,066 | 2,405 | 2,405 | |||||||||||||||
| Total operating expense |
170,409 | (5,733 | ) | 164,676 | 132,287 | 132,287 | |||||||||||||
| Operating income |
19,351 | 25,084 | 20,637 | 20,637 | |||||||||||||||
| Interest and other income (expense), net |
533 | 533 | (434 | ) | (434 | ) | |||||||||||||
| Income before provision for income taxes and equity in earnings of unconsolidated subsidiaries |
19,884 | 25,617 | 20,203 | 20,203 | |||||||||||||||
| Provision for income taxes (4), (5) |
6,980 | 2,093 | 9,073 | 430 | 6,500 | 6,930 | |||||||||||||
| Equity in earnings of unconsolidated subsidiaries, net |
635 | 635 | 527 | 527 | |||||||||||||||
| Net income |
$ | 13,539 | $ | 17,179 | $ | 20,300 | $ | 13,800 | |||||||||||
| Interest expense on convertible securities, net of taxes |
509 | 509 | 759 | 759 | |||||||||||||||
| Net income adjusted for computation of diluted EPS |
$ | 14,048 | $ | 17,688 | $ | 21,059 | $ | 14,559 | |||||||||||
| Basic earnings per common share |
$ | 0.33 | $ | 0.41 | $ | 0.51 | $ | 0.35 | |||||||||||
| Basic weighted average common shares outstanding |
41,408 | 41,408 | 39,874 | 39,874 | |||||||||||||||
| Diluted earnings per common share |
$ | 0.30 | $ | 0.37 | $ | 0.45 | $ | 0.31 | |||||||||||
| Diluted weighted average common shares outstanding |
47,252 | 47,252 | 47,209 | 47,209 | |||||||||||||||
Explanation of Non-GAAP Adjustments
For the Three Months Ended April 30, 2007:
| (1) | $1,152 SFAS 123(R) expense |
| (2) | $5,187 executive compensation contract termination charge |
| (3) | Credit adjustment to previously recorded lease restructuring reserve |
| (4) | Tax effect related to net operating expense adjustments of $5,733 |
For the Three Months Ended April 30, 2006:
| (5) | $6,500 one-time tax benefit |
KORN/FERRY INTERNATIONAL AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
EXCLUDING NON-GAAP ADJUSTMENTS
(in thousands, except per share amounts)
(unaudited)
| Year Ended April 30, |
|||||||||||||||||||
| 2007 - As Reported |
Adjustments | 2007 - As Adjusted |
2006 - As Reported |
Adjustments | 2006 - As Adjusted |
||||||||||||||
| Fee revenue |
$ | 653,422 | $ | 653,422 | $ | 522,882 | $ | 522,882 | |||||||||||
| Reimbursed out-of-pocket engagement expenses |
35,779 | 35,779 | 28,887 | 28,887 | |||||||||||||||
| Total revenue |
689,201 | 689,201 | 551,769 | 551,769 | |||||||||||||||
| Compensation and benefits (1), (2) |
447,692 | (5,695 | ) | 436,810 | 341,196 | 341,196 | |||||||||||||
| (5,187 | ) | ||||||||||||||||||
| General and administrative expense (3) |
105,312 | 606 | 105,918 | 93,462 | 93,462 | ||||||||||||||
| Out-of-pocket engagement expenses |
44,662 | 44,662 | 31,927 | 31,927 | |||||||||||||||
| Depreciation and amortization |
9,280 | 9,280 | 9,002 | 9,002 | |||||||||||||||
| Total operating expense |
606,946 | (10,276 | ) | 596,670 | 475,587 | 475,587 | |||||||||||||
| Operating income |
82,255 | 92,531 | 76,182 | 76,182 | |||||||||||||||
| Interest and other income (expense), net (5) |
244 | 244 | 842 | (4,535 | ) | (3,693 | ) | ||||||||||||
| Income before provision for income taxes and equity in earnings of unconsolidated subsidiaries |
82,499 | 92,775 | 77,024 | 72,489 | |||||||||||||||
| Provision for income taxes (4), (6) |
30,164 | 3,751 | 33,915 | 19,594 | 6,500 | 26,094 | |||||||||||||
| Equity in earnings of unconsolidated subsidiaries, net |
3,163 | 3,163 | 2,000 | 2,000 | |||||||||||||||
| Net income |
$ | 55,498 | $ | 62,023 | $ | 59,430 | $ | 48,395 | |||||||||||
| Interest expense on convertible securities, net of taxes |
2,863 | 2,863 | 3,113 | 3,113 | |||||||||||||||
| Net income adjusted for computation of diluted EPS |
$ | 58,361 | $ | 64,886 | $ | 62,543 | $ | 51,508 | |||||||||||
| Basic earnings per common share |
$ | 1.40 | $ | 1.56 | $ | 1.49 | $ | 1.21 | |||||||||||
| Basic weighted average common shares outstanding |
39,774 | 39,774 | 39,889 | 39,889 | |||||||||||||||
| Diluted earnings per common share |
$ | 1.24 | $ | 1.38 | $ | 1.32 | $ | 1.09 | |||||||||||
| Diluted weighted average common shares outstanding |
46,938 | 46,938 | 47,270 | 47,270 | |||||||||||||||
Explanation of Non-GAAP Adjustments
For the Year Ended April 30, 2007:
| (1) | $5,695 SFAS 123(R) expense |
| (2) | $5,187 executive compensation contract termination charge recorded in Q407 |
| (3) | Credit adjustment to previously recorded lease restructuring reserve recorded in Q407 |
| (4) | Tax effect related to net operating expense adjustments of $10,276 |
For the Year Ended April 30, 2007:
| (5) | $4,535 loss recovery on an investment sold by the Company in Q306 |
| (6) | $6,500 one-time tax benefit recorded in Q406 |