Q3 2024 Heidrick & Struggles International Inc Earnings Call Transcript
Key Points
- Heidrick & Struggles International Inc (HSII) delivered a solid performance in the third quarter, with revenue growth of 6% and organic revenue growth of 5% year-to-date.
- The company's core executive search business showed excellent results, particularly in the Americas and Asia Pacific regions.
- The on-demand talent business achieved solid growth despite a slowdown in the broader temporary staffing space, highlighting HSII's unique market position.
- HSII's consulting segment saw a 20% increase in organic revenue year-over-year, driven by leadership assessment and development engagements.
- The company maintains a strong cash position of $409 million with no debt, providing financial flexibility to execute strategic plans and return capital to shareholders.
- The executive search business in Europe experienced a revenue decline of 3.3% or 5% on a constant currency basis.
- Adjusted EBITDA margin slightly decreased to 10.9% from 11.2% in the previous year, indicating room for improvement.
- The consulting segment, while showing revenue growth, still reported an adjusted EBITDA loss, highlighting ongoing challenges in achieving profitability.
- Salaries and benefits expenses increased by 9.5% from the prior year, impacting overall profitability.
- The company's effective tax rate is expected to be temporarily high at around 38% due to non-deductibility of acquisition earn-out costs.
Ladies and gentlemen, good afternoon and thank you for standing by. My name is Abby and I will be your conference operator today. At this time, I would like to welcome everyone to the Heidrick & Struggles International Third Quarter 2024 Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. (Operator Instructions)
Thank you. I would now like to turn the conference over to Suzanne Rosenberg, Investor Relations. You may begin.
Thank you and welcome to our 2024 3rd quarter conference call. Joining me today are our CEO Tom Monahan and Vice President and Controller Steve Bondi.
We posted our accompanying slides on the IR homepage of our website at hydrid dotcom and we encourage you to view these slides for additional context. Please note that in the materials presented today, we may refer to non-GAAP financial measures that we believe provide
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