Business Segments |
7. Business Segments
The Company currently operates in three global businesses:
Executive Recruitment, LTC and Futurestep. The Executive
Recruitment segment focuses on recruiting Board of Director and
C-level positions, in addition to research-based interviewing and
onboarding solutions, for clients predominantly in the consumer,
financial services, industrial, life sciences/healthcare and
technology industries. LTC assists clients with ongoing assessment
and development of their senior executives and management teams,
and addresses three fundamental needs: Talent Strategy, Succession
Management, and Leadership Development, all underpinned by a
comprehensive array of world-leading IP, products and tools.
Futurestep is a global industry leader in high-impact talent
acquisition solutions. Its portfolio of services includes global
and regional RPO, project recruitment, individual professional
search and consulting. The Executive Recruitment business segment
is managed by geographic regional leaders and LTC and Futurestep
worldwide operations are managed by their respective Chief
Executive Officers. The Executive Recruitment geographic regional
leaders and the Chief Executive Officers of LTC and Futurestep
report directly to the Chief Executive Officer of the Company. The
Company also operates a Corporate segment to record global expenses
of the Company.
The Company evaluates performance and allocates resources based on
the Company’s chief operating decision maker’s
(“CODM”) review of (1) fee revenue and
(2) adjusted earnings before interest, taxes, depreciation and
amortization (“Adjusted EBITDA”). To the extent that
such charges occur, Adjusted EBITDA excludes restructuring charges,
integration and acquisition costs, certain separation costs and
certain non-cash charges (goodwill, intangible asset and other than
temporary impairment). The accounting policies for the reportable
segments are the same as those described in the summary of
significant accounting policies, except the items described above
are excluded from EBITDA to arrive at Adjusted EBITDA.
Financial highlights by business segment are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended October 31,
2015 |
|
|
|
Executive Recruitment |
|
|
LTC |
|
|
Futurestep |
|
|
Corporate |
|
|
Consolidated |
|
|
|
North
America |
|
|
EMEA |
|
|
Asia
Pacific |
|
|
South
America |
|
|
Subtotal |
|
|
|
|
|
|
|
(in
thousands) |
|
Fee revenue
|
|
$ |
92,788 |
|
|
$ |
36,570 |
|
|
$ |
20,998 |
|
|
$ |
6,116 |
|
|
$ |
156,472 |
|
|
$ |
73,602 |
|
|
$ |
50,526 |
|
|
$ |
— |
|
|
$ |
280,600 |
|
Total revenue
|
|
$ |
96,198 |
|
|
$ |
37,509 |
|
|
$ |
21,617 |
|
|
$ |
6,118 |
|
|
$ |
161,442 |
|
|
$ |
75,991 |
|
|
$ |
53,906 |
|
|
$ |
— |
|
|
$ |
291,339 |
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
17,971 |
|
Other loss, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,646 |
|
Interest expense, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
544 |
|
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(540 |
) |
Income tax provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,392 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$ |
27,422 |
|
|
$ |
6,929 |
|
|
$ |
3,907 |
|
|
$ |
970 |
|
|
$ |
39,228 |
|
|
$ |
7,778 |
|
|
$ |
6,896 |
|
|
$ |
(24,889 |
) |
|
$ |
29,013 |
|
Depreciation and amortization
|
|
|
832 |
|
|
|
232 |
|
|
|
223 |
|
|
|
73 |
|
|
|
1,360 |
|
|
|
3,588 |
|
|
|
578 |
|
|
|
1,654 |
|
|
|
7,180 |
|
Other (loss) income, net
|
|
|
(127 |
) |
|
|
7 |
|
|
|
(6 |
) |
|
|
33 |
|
|
|
(93 |
) |
|
|
(17 |
) |
|
|
8 |
|
|
|
(2,544 |
) |
|
|
(2,646 |
) |
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
140 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
140 |
|
|
|
— |
|
|
|
— |
|
|
|
400 |
|
|
|
540 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
28,267 |
|
|
|
7,168 |
|
|
|
4,124 |
|
|
|
1,076 |
|
|
|
40,635 |
|
|
|
11,349 |
|
|
|
7,482 |
|
|
|
(25,379 |
) |
|
|
34,087 |
|
Integration/acquisition costs
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,310 |
|
|
|
— |
|
|
|
8,684 |
|
|
|
11,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$ |
28,267 |
|
|
$ |
7,168 |
|
|
$ |
4,124 |
|
|
$ |
1,076 |
|
|
$ |
40,635 |
|
|
$ |
14,659 |
|
|
$ |
7,482 |
|
|
$ |
(16,695 |
) |
|
$ |
46,081 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended October 31,
2014 |
|
|
|
Executive Recruitment |
|
|
LTC |
|
|
Futurestep |
|
|
Corporate |
|
|
Consolidated |
|
|
|
North
America |
|
|
EMEA |
|
|
Asia
Pacific |
|
|
South
America |
|
|
Subtotal |
|
|
|
|
|
|
|
(in
thousands) |
|
Fee revenue
|
|
$ |
82,729 |
|
|
$ |
36,675 |
|
|
$ |
21,157 |
|
|
$ |
8,369 |
|
|
$ |
148,930 |
|
|
$ |
66,408 |
|
|
$ |
40,364 |
|
|
$ |
— |
|
|
$ |
255,702 |
|
Total revenue
|
|
$ |
86,252 |
|
|
$ |
38,054 |
|
|
$ |
21,716 |
|
|
$ |
8,383 |
|
|
$ |
154,405 |
|
|
$ |
68,477 |
|
|
$ |
41,835 |
|
|
$ |
— |
|
|
$ |
264,717 |
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
25,403 |
|
Other income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,362 |
) |
Interest expense, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
920 |
|
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(452 |
) |
Income tax provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,907 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$ |
19,117 |
|
|
$ |
5,621 |
|
|
$ |
3,424 |
|
|
$ |
1,699 |
|
|
$ |
29,861 |
|
|
$ |
7,762 |
|
|
$ |
5,150 |
|
|
$ |
(8,357 |
) |
|
$ |
34,416 |
|
Depreciation and amortization
|
|
|
891 |
|
|
|
446 |
|
|
|
261 |
|
|
|
85 |
|
|
|
1,683 |
|
|
|
3,279 |
|
|
|
459 |
|
|
|
1,358 |
|
|
|
6,779 |
|
Other income (loss), net
|
|
|
194 |
|
|
|
(1 |
) |
|
|
149 |
|
|
|
13 |
|
|
|
355 |
|
|
|
(172 |
) |
|
|
25 |
|
|
|
2,154 |
|
|
|
2,362 |
|
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
110 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
110 |
|
|
|
— |
|
|
|
— |
|
|
|
342 |
|
|
|
452 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
20,312 |
|
|
|
6,066 |
|
|
|
3,834 |
|
|
|
1,797 |
|
|
|
32,009 |
|
|
|
10,869 |
|
|
|
5,634 |
|
|
|
(4,503 |
) |
|
|
44,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$ |
20,312 |
|
|
$ |
6,066 |
|
|
$ |
3,834 |
|
|
$ |
1,797 |
|
|
$ |
32,009 |
|
|
$ |
10,869 |
|
|
$ |
5,634 |
|
|
$ |
(4,503 |
) |
|
$ |
44,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended October 31,
2015 |
|
|
|
Executive Recruitment |
|
|
LTC |
|
|
Futurestep |
|
|
Corporate |
|
|
Consolidated |
|
|
|
North
America |
|
|
EMEA |
|
|
Asia
Pacific |
|
|
South
America |
|
|
Subtotal |
|
|
|
|
|
|
|
(in
thousands) |
|
Fee revenue
|
|
$ |
183,147 |
|
|
$ |
72,660 |
|
|
$ |
40,213 |
|
|
$ |
12,542 |
|
|
$ |
308,562 |
|
|
$ |
142,842 |
|
|
$ |
96,590 |
|
|
$ |
— |
|
|
$ |
547,994 |
|
Total revenue
|
|
$ |
190,597 |
|
|
$ |
74,680 |
|
|
$ |
41,607 |
|
|
$ |
12,550 |
|
|
$ |
319,434 |
|
|
$ |
147,432 |
|
|
$ |
103,808 |
|
|
$ |
— |
|
|
$ |
570,674 |
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
41,053 |
|
Other loss, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,720 |
|
Interest expense, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
843 |
|
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,265 |
) |
Income tax provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,566 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$ |
51,567 |
|
|
$ |
13,205 |
|
|
$ |
6,893 |
|
|
$ |
2,478 |
|
|
$ |
74,143 |
|
|
$ |
15,273 |
|
|
$ |
13,085 |
|
|
$ |
(40,584 |
) |
|
$ |
61,917 |
|
Depreciation and amortization
|
|
|
1,659 |
|
|
|
597 |
|
|
|
469 |
|
|
|
151 |
|
|
|
2,876 |
|
|
|
7,336 |
|
|
|
1,163 |
|
|
|
3,228 |
|
|
|
14,603 |
|
Other (loss) income, net
|
|
|
(95 |
) |
|
|
150 |
|
|
|
12 |
|
|
|
272 |
|
|
|
339 |
|
|
|
(880 |
) |
|
|
8 |
|
|
|
(2,187 |
) |
|
|
(2,720 |
) |
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
226 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
226 |
|
|
|
— |
|
|
|
— |
|
|
|
1,039 |
|
|
|
1,265 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
53,357 |
|
|
|
13,952 |
|
|
|
7,374 |
|
|
|
2,901 |
|
|
|
77,584 |
|
|
|
21,729 |
|
|
|
14,256 |
|
|
|
(38,504 |
) |
|
|
75,065 |
|
Integration/acquisition costs
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,639 |
|
|
|
— |
|
|
|
9,029 |
|
|
|
12,668 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$ |
53,357 |
|
|
$ |
13,952 |
|
|
$ |
7,374 |
|
|
$ |
2,901 |
|
|
$ |
77,584 |
|
|
$ |
25,368 |
|
|
$ |
14,256 |
|
|
$ |
(29,475 |
) |
|
$ |
87,733 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended October 31,
2014 |
|
|
|
Executive Recruitment |
|
|
LTC |
|
|
Futurestep |
|
|
Corporate |
|
|
Consolidated |
|
|
|
North
America |
|
|
EMEA |
|
|
Asia
Pacific |
|
|
South
America |
|
|
Subtotal |
|
|
|
|
|
|
|
(in
thousands) |
|
Fee revenue
|
|
$ |
165,029 |
|
|
$ |
76,972 |
|
|
$ |
40,691 |
|
|
$ |
14,653 |
|
|
$ |
297,345 |
|
|
$ |
129,956 |
|
|
$ |
79,589 |
|
|
$ |
— |
|
|
$ |
506,890 |
|
Total revenue
|
|
$ |
172,334 |
|
|
$ |
79,483 |
|
|
$ |
42,085 |
|
|
$ |
14,692 |
|
|
$ |
308,594 |
|
|
$ |
133,897 |
|
|
$ |
82,551 |
|
|
$ |
— |
|
|
$ |
525,042 |
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
39,936 |
|
Other income, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,539 |
) |
Interest expense, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,714 |
|
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(918 |
) |
Income tax provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$ |
38,115 |
|
|
$ |
8,264 |
|
|
$ |
5,946 |
|
|
$ |
1,772 |
|
|
$ |
54,097 |
|
|
$ |
11,222 |
|
|
$ |
8,607 |
|
|
$ |
(20,917 |
) |
|
$ |
53,009 |
|
Depreciation and amortization
|
|
|
1,795 |
|
|
|
935 |
|
|
|
555 |
|
|
|
170 |
|
|
|
3,455 |
|
|
|
6,531 |
|
|
|
905 |
|
|
|
2,658 |
|
|
|
13,549 |
|
Other income, net
|
|
|
323 |
|
|
|
45 |
|
|
|
258 |
|
|
|
46 |
|
|
|
672 |
|
|
|
45 |
|
|
|
23 |
|
|
|
3,799 |
|
|
|
4,539 |
|
Equity in earnings of unconsolidated subsidiaries, net
|
|
|
178 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
178 |
|
|
|
— |
|
|
|
— |
|
|
|
740 |
|
|
|
918 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
40,411 |
|
|
|
9,244 |
|
|
|
6,759 |
|
|
|
1,988 |
|
|
|
58,402 |
|
|
|
17,798 |
|
|
|
9,535 |
|
|
|
(13,720 |
) |
|
|
72,015 |
|
Restructuring charges, net
|
|
|
1,151 |
|
|
|
3,987 |
|
|
|
17 |
|
|
|
377 |
|
|
|
5,532 |
|
|
|
2,758 |
|
|
|
1,424 |
|
|
|
172 |
|
|
|
9,886 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$ |
41,562 |
|
|
$ |
13,231 |
|
|
$ |
6,776 |
|
|
$ |
2,365 |
|
|
$ |
63,934 |
|
|
$ |
20,556 |
|
|
$ |
10,959 |
|
|
$ |
(13,548 |
) |
|
$ |
81,901 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|