CHICAGO - Heidrick & Struggles (NASDAQ:HSII) International, Inc. (NASDAQ:HSII), a global leader in executive search and consulting, reported fourth-quarter earnings that surpassed analyst expectations, alongside revenue that also exceeded forecasts.
The company announced an adjusted EPS of $0.72 for the quarter, $0.03 higher than the analyst estimate of $0.69. Revenue for the quarter was reported at $253.2 million, compared to the consensus estimate of $248.17 million, marking a 7% increase from the same quarter last year.
The company provided guidance for the first quarter of 2024, projecting revenues between $245 million and $265 million, which is above the analyst consensus of $242.8 million.
This guidance reflects management's expectations based on several factors, including the average currency rates in December 2023 and the anticipated volume of new Executive Search confirmations, On-Demand Talent projects, and Heidrick Consulting assignments.
President and CEO Krishnan Rajagopalan commented on the results, stating, "We are very pleased with how we finished the year and what is reflected by our fourth quarter results, having delivered solid year-over-year growth in both revenue and adjusted EBITDA." He also highlighted the company's strategic progress, noting the 44% growth in Diversified Solutions during 2023 and the successful investments in Heidrick Digital and other key businesses.
Despite the positive earnings and revenue beat, the stock remained unchanged with a 0.0% move following the earnings release. This lack of movement suggests that the market had already anticipated the strong results, or there are other factors at play influencing investor sentiment.
For the full year of 2023, Heidrick & Struggles reported a slight decrease in net revenue of 4% compared to the previous year, totaling $1,026.9 million. However, the company saw an increase in adjusted EBITDA of 4% year over year, reaching $125.6 million, with adjusted EBITDA margins improving by 90 basis points to 12.2%.
The company's Executive Search net revenue saw a decrease in the fourth quarter, particularly in the Asia Pacific and the Americas regions, while On-Demand Talent and Heidrick Consulting experienced significant growth, thanks in part to strategic acquisitions.
Looking ahead, Heidrick & Struggles is poised to leverage improving market conditions to enhance revenue and profitability in 2024. The company plans to continue partnering with clients to provide comprehensive services aimed at finding top leaders and fostering high-performing, inclusive cultures.
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