Korn/Ferry Tops Q4 Views, Shares Surge

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surged more than 3 percent in after-hours trading after the company reported upbeat results for its fiscal fourth quarter. The Los Angeles, California-based company posted quarterly earnings of $25.5 million, or $0.51 per share, compared to $21.2 million, or $0.43 per share, in the year-earlier quarter. Its fee revenue climbed 8 percent year-over-year to $271.7 million, while total revenue surged to $282.2 million from $260.8 million. However, analysts were expecting earnings of $0.47 per share on revenue of $260.86 million. The average estimate among 6 Estimize users was for earnings of $0.47 per share and revenue of $263.25 million. Fee revenue at its executive-recruitment segment rose 5.7 percent year-over-year to $156.6 million, while fee revenue at its leadership and talent consulting segment gained 10 percent to $72.7 million. Fee revenue at its Futurestep segment jumped 13.7 percent to $42.4 million in the quarter. Adjusted EBITDA jumped 18 percent to $40.7 million in the latest quarter, while operating income climbed to $28.1 million from $24.5 million. Compensation and benefit expenses climbed 7.3 percent year-over-year to $183.0 million in the quarter. Its adjusted EBITDA margin widened 130 basis points to 15.0 percent in the quarter, from 13.7 percent in the year-ago quarter. At April 30, 2015, cash and marketable securities were $525.4 million, versus $468.3 million at April 30, 2014. "Korn Ferry closed out the fiscal year with a strong quarter and record fee revenue of $271.8 million – 14.2% growth year over year and 11.4% growth sequentially, at constant currency, with diluted earnings per share of $0.51. With all service lines up year over year, our quarterly results propelled our fiscal year fee revenue to a record high of $1.03 billion – a major milestone in our firm's history," said Gary D. Burnison, CEO, Korn Ferry. For the current quarter, the company expects earnings of $0.44 to $0.50 per share, versus analysts' expectations of $0.44 per share. Korn/Ferry projects revenue of $258 million to $270 million, versus analysts' estimates of $263.92 million. Korn/Ferry shares surged 3.79 percent to $34.00 in the after-hours trading session.