CTPartners Executive Search Inc. Announces Third Quarter 2013 Financial Results
CTPartners Executive Search Inc, a global retained executive search firm, has announced its financial results for the third quarter and nine months ended September 30, 2013.
“We are pleased that our third quarter performance met our expectations. While revenue was at the lower end of guidance, adjusted EPS came in at the midpoint reflecting the positive impact of the cost reduction initiatives we implemented earlier in the year,” commented Brian Sullivan, Chief Executive Officer.
He added: “Importantly, we have made several new partner announcements since the beginning of September. This has been a transformational period for CTPartners as we have significantly strengthened our consultant rank. We added six of the top consultants in the search industry in their respective areas of specialization; industrial/energy, consumer/retail, professional services and financial services. We expect to see some benefits of their contribution from a revenue perspective beginning in this year’s fourth quarter; however their leadership will show a positive impact immediately and for years to come. These additions enable us to elevate the CTPartners brand, providing momentum for improved results in 2014.”
Third Quarter Results
Net revenue for the third quarter was $32.6 million, a record high for the company’s third quarter, representing a 1.7% increase compared with $32.0 million in the prior year’s third quarter. EMEA was up 22.6% at $8.6 million; North American revenue decreased 2.2% to $18.7 million and Latin America revenue was $3.6 million compared to $3.9 million. Asia Pacific revenue was $1.6 million compared to $2.0 million in the prior year quarter. On a practice basis, year-over-year, Professional Services increased 56.6% to $6.5 million, Industrial grew 29.1% to $3.7 million and Consumer/Retail improved 15.2% to $4.5 million. Due to industry softness, Financial Services and Life Sciences declined 7.6% and 5.7%, respectively, with the softness more pronounced in Technology Media and Telecom, which decreased 43.7% to $2.7 million.
Compensation expense, excluding non-operating expenses, was $24.5 million, or 75.1% of revenue, compared to $24.7 million, or 77.0% in the third quarter of 2012. General and administrative expenses, excluding non-operating expenses, were $6.9 million, or 21.2% of revenue.
GAAP net income attributable to the company for the third quarter was $0.7 million, or $0.09 per share, compared to a net loss of $1.2 million, or $0.17 per share loss for last year’s third quarter. Excluding after-tax non-operating items of $0.1 million, adjusted net income was $0.6 million, or $0.08 per share compared to adjusted net income of $0.4 million, or $0.06 per share in the prior year’s third quarter.
The company was engaged in 341 new search assignments, a 7% increase compared to 318 in the year-ago quarter.
The number of placements was 253 compared with 257 in last year’s comparable quarter. The placement rate for this year’s third quarter was 82%, a significant increase compared to the 72% placement rate in the 2012 third quarter.
CTPartners had 120 consultants compared with 102 consultants in the year-ago quarter, primarily reflecting the Augmentum Consulting Ltd acquisition.
Net revenue per consultant was $1.1 million.
Average revenue per search was relatively flat at $92,100.
The company’s voluntary turnover was one consultant, maintaining one of the lowest turnovers in the executive search industry.
The number of clients representing repeat business was 79% in the quarter compared with 74% in last year’s third quarter and 72% in 2013 second quarter.
For the fourth quarter ending December 31, 2013, the company expects to report net revenue in the range of $31.0 million to $33.0 million and adjusted earnings per share between $0.07 to $0.10, excluding non-operating items.
search-consult is published by Dillistone Systems, supplier of FileFinder Executive Search software. Dillistone Systems is part of Dillistone Group Plc, as are Voyager Recruitment Software and FCP Internet, supplier of the Evolve Recruitment Software SaaS system.