Heidrick & Struggles International, Inc (HSII) has reported a 60.87 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $0.49 million, or $0.03 a share in the quarter, compared with $1.26 million, or $0.07 a share for the same period last year.
Revenue during the quarter grew 10.23 percent to $164.56 million from $149.30 million in the previous year period. Total expenses were 95.34 percent of quarterly revenues, down from 96.46 percent for the same period last year. This has led to an improvement of 112 basis points in operating margin to 4.66 percent.
Operating income for the quarter was $7.66 million, compared with $5.28 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $14.86 million compared with $11.36 million in the prior year period. At the same time, adjusted EBITDA margin improved 142 basis points in the quarter to 9.03 percent from 7.61 percent in the last year period.
“We finished 2016 with solid fourth quarter results that reflect a return on the strategic investments we have made in the business over the last year,” said Tracy Wolstencroft, Heidrick & Struggles president and chief executive officer. “Executive Search net revenue increased 6.3 percent in the fourth quarter, with gains in all three regions. Our Leadership Consulting business has grown increasingly more significant in our portfolio of advisory services as well as to our financial results. Five of our top 10 clients in 2016 utilized Heidrick & Struggles for both Executive Search and Leadership Consulting. Leadership Consulting revenue was $15.6 million in the fourth quarter and the operating margin was 28.3 percent.”
For the first-quarter, Heidrick & Struggles International expects revenue to be in the range of $140 million to $150 million.
Operating cash flow drops significantly
Heidrick & Struggles International, Inc has generated cash of $24.82 million from operating activities during the year, down 56.89 percent or $32.76 million, when compared with the last year.
The company has spent $27.78 million cash to meet investing activities during the year as against cash outgo of $27.51 million in the last year.
The company has spent $20.09 million cash to carry out financing activities during the year as against cash outgo of $46.34 million in the last year period.
Cash and cash equivalents stood at $165.01 million as on Dec. 31, 2016, down 13.36 percent or $25.44 million from $190.45 million on Dec. 31, 2015.
Working capital decreases marginally
Heidrick & Struggles International, Inc has witnessed a decline in the working capital over the last year. It stood at $77.84 million as at Dec. 31, 2016, down 2.13 percent or $1.70 million from $79.53 million on Dec. 31, 2015. Current ratio was at 1.35 as on Dec. 31, 2016, up from 1.35 on Dec. 31, 2015.
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