Korn Ferry Announces Fourth Quarter and Fiscal 2020 Results of Operations
Korn Ferry reported FY'20 fee revenue of $1,932.7 million, roughly unchanged from FY'19, with a net income of $104.9 million. In Q4 FY'20, fee revenue fell to $440.5 million, a 10% decline compared to Q4 FY'19, resulting in a net loss of $0.8 million. Operating margin decreased to 5.0% while Adjusted EBITDA stood at $69.6 million with a margin of 15.8%. The company maintained a solid liquidity position with $863 million in cash and equivalents. A quarterly dividend of $0.10 per share was declared for stockholders.
- Net income of $104.9 million for FY'20, slightly up from $102.7 million FY'19.
- Liquidity position remains strong with $863 million in cash and equivalents.
- Q4 FY'20 fee revenue decreased by 10% year-over-year.
- Net loss of $0.8 million in Q4 FY'20 compared to a profit of $50.3 million in Q4 FY'19.
- Operating margin declined from 12.7% in Q4 FY'19 to 5.0% in Q4 FY'20.
LOS ANGELES, July 2, 2020 /PRNewswire/ --
Highlights
- Korn Ferry reports annual fee revenue of
$1,932.7 million , essentially flat year-over-year (2.2% increase on a constant currency). - Net income attributable to Korn Ferry was
$104.9 million in FY'20 with an operating margin of9.1% and Adjusted EBITDA of$301.0 million and Adjusted EBITDA margin of15.6% . - Fee revenue was
$440.5 million in Q4 FY'20, a decrease of10% (7.9% on a constant currency) as compared to Q4 FY'19. - Net loss attributable to Korn Ferry was
$0.8 million in Q4 FY'20, with an operating margin of5.0% . Adjusted EBITDA was$69.6 million in Q4 FY'20 with an Adjusted EBITDA margin of15.8% . - Q4 FY'20 diluted loss per share was
$0.02 compared to diluted earnings per share of$0.89 in Q4 FY'19. Adjusted diluted earnings per share was$0.60 in Q4 FY'20 compared to$0.88 in Q4 FY'19. - The Company ended the year with a strong liquidity position with total cash and cash equivalents and marketable securities of
$863 million , and after setting aside amounts for bonus payments and deferred compensation arrangements, investable cash was$532 million . - The Company repurchased 0.8 million shares, using
$24.4 million of cash during the quarter. Further, the Company declared a quarterly dividend of$0.10 per share on July 1, 2020 payable on July 15, 2020 to stockholders of record on July 31, 2020.
Korn Ferry (NYSE: KFY), a global organizational consulting firm, today announced fourth quarter and annual fee revenue of
"During the fiscal fourth quarter we generated
"As we manage our way through COVID-19, our Korn Ferry colleagues are showing their resilience by quickly pivoting to a different way of working – whether it's from home or the rapid transition to the virtual delivery of our services and solutions to clients. I'm confident that our offerings are more relevant now than ever before," Burnison added. "I truly feel that over the next 2 years there will be more change than in the last 10 years. Different work needs to get done, and work needs to get done differently. That's an opportunity for our company. As an organizational consulting firm, Korn Ferry is committed to promoting conscious inclusion – enabling all people and their organizations to exceed their potential – and to exceed potential, people need an abundance of opportunity, development, and sponsorship. Korn Ferry is the right firm at the right time to help organizations drive performance through change, and I have never been more proud of our company."
Selected Financial Results
(dollars in millions, except per share amounts) (a)
Fourth Quarter | Year to Date | |||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
Fee revenue | $ | 440.5 | $ | 490.8 | $ | 1,932.7 | $ | 1,926.0 | ||||||||
Total revenue | $ | 449.0 | $ | 502.5 | $ | 1,977.3 | $ | 1,973.9 | ||||||||
Operating income | $ | 22.2 | $ | 62.3 | $ | 176.0 | $ | 140.8 | ||||||||
Operating margin | ||||||||||||||||
Net (loss) income attributable to Korn Ferry | $ | (0.8) | $ | 50.3 | $ | 104.9 | $ | 102.7 | ||||||||
Basic (loss) earnings per share | $ | (0.02) | $ | 0.90 | $ | 1.91 | $ | 1.84 | ||||||||
Diluted (loss) earnings per share | $ | (0.02) | $ | 0.89 | $ | 1.90 | $ | 1.81 | ||||||||
EBITDA Results (b): | Fourth Quarter | Year to Date | ||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
EBITDA | $ | 26.3 | $ | 82.2 | $ | 228.5 | $ | 197.7 | ||||||||
EBITDA margin | ||||||||||||||||
Adjusted Results (c): | Fourth Quarter | Year to Date | ||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
Adjusted EBITDA (b) | $ | 69.6 | $ | 82.2 | $ | 301.0 | $ | 311.0 | ||||||||
Adjusted EBITDA margin (b) | ||||||||||||||||
Adjusted net income attributable to Korn Ferry | $ | 32.7 | $ | 49.7 | $ | 161.3 | $ | 187.9 | ||||||||
Adjusted basic earnings per share | $ | 0.60 | $ | 0.89 | $ | 2.94 | $ | 3.36 | ||||||||
Adjusted diluted earnings per share | $ | 0.60 | $ | 0.88 | $ | 2.91 | $ | 3.31 | ||||||||
____________________ | ||||||||||||||||
(a) | Numbers may not total due to rounding. | |||||||||||||||
(b) | EBITDA refers to earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA further adjusts EBITDA to exclude integration/acquisition costs, restructuring charges, net, separation costs and tradename write-offs. EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures (see attached reconciliations). | |||||||||||||||
(c) | Adjusted results are non-GAAP financial measures that adjust for the following, as applicable (see attached reconciliations): | |||||||||||||||
Fourth Quarter | Year to Date | |||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
Integration/acquisition costs | $ | 2.8 | $ | — | $ | 12.2 | $ | 6.7 | ||||||||
Restructuring charges, net | $ | 40.5 | $ | — | $ | 58.6 | $ | — | ||||||||
Separation costs | $ | — | $ | — | $ | 1.8 | $ | — | ||||||||
Tradename write-offs | $ | — | $ | — | $ | — | $ | 106.6 | ||||||||
Debt refinancing costs | $ | — | $ | — | $ | 0.8 | $ | — |
Fiscal 2020 Fourth Quarter Results
The Company reported fee revenue in Q4 FY'20 of
Net loss attributable to Korn Ferry was
Operating margin was
Adjusted EBITDA margin was
Fiscal 2020 Results
The Company reported fee revenue in FY'20 of
Net income attributable to Korn Ferry was
Operating income was
Adjusted EBITDA was
Results by Segment
Selected Consulting Data(a)
(dollars in millions) (b)
Fourth Quarter | Year to Date | |||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
Fee revenue | $ | 121.0 | $ | 144.4 | $ | 543.1 | $ | 568.3 | ||||||||
Total revenue | $ | 123.4 | $ | 148.7 | $ | 557.3 | $ | 585.9 | ||||||||
Operating (loss) income | $ | (6.6) | $ | 13.3 | $ | 17.7 | $ | (34.1) | ||||||||
Operating margin | ( | ( | ||||||||||||||
Ending number of consultants and execution staff (c) | 1,671 | 1,881 | 1,671 | 1,881 | ||||||||||||
Hours worked in thousands (d) | 415 | 439 | 1,758 | 1,703 | ||||||||||||
Average billed rate (e) | $ | 292 | $ | 329 | $ | 309 | $ | 334 | ||||||||
EBITDA Results (f): | Fourth Quarter | Year to Date | ||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
EBITDA | $ | (2.3) | $ | 18.4 | $ | 36.6 | $ | (15.7) | ||||||||
EBITDA margin | ( | ( | ||||||||||||||
Adjusted Results (g): | Fourth Quarter | Year to Date | ||||||||||||||
FY'20 | FY'19 | FY'20 | FY'19 | |||||||||||||
Adjusted EBITDA (f) | $ | 11.1 | $ | 18.4 | $ | 61.1 | $ | 66.5 | ||||||||
Adjusted EBITDA margin (f) | ||||||||||||||||
____________________ | ||||||||||||||||
(a) | In fiscal 2020, the Company changed the composition of its global segments. Consulting segment represents the consulting business that was previously included in the Advisory segment. Segment data for Q4 FY'19 and YTD FY' |
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