Daily Archives: September 6, 2018

Korn Ferry International Inc. (NYSE: KFY) yesterday reported total fee revenue rose 15.7% in constant currency in its fiscal first quarter ended July 31. The increase on a reported basis was 16.0%. The Los Angeles-based provider of executive search and consulting reported the organic growth was driven by all three lines of business.

During the first quarter the company announced a rebranding campaign under which it is sunsetting all sub-brands and moving to one unified brand – Korn Ferry. In connection with this, the company incurred a charge of $106.6 million related to tradenames from prior acquisitions that the company will no longer be using, resulting in an operating loss of $55.1 million.

Quote

“As disclosed last quarter, we are sunsetting our legacy logos and migrating to one unified brand — Korn Ferry,” CEO Gary Burnison said. “Over the next 15 months, we will continue to move our organization towards an industry, solution and geographic orientation to capture the substantial opportunity we have as an organizational consulting firm.”

• Executive search fee revenue rose 19.3% on a constant currency basis to $192.9 million. The increase was attributable to higher fee revenue in all regions.
• Advisory (formerly Hay Group) fee revenue rose 8.6% in constant currency to $195.4 million, driven by increases in each of our Advisory solution areas — primarily from consulting.
• Fee revenue in RPO and professional search data (formerly Futurestep) rose 27.2% in constant currency to $77.3 million. The higher fee revenue was primarily driven by year-over-year increases in recruitment process outsourcing and professional search of $9.3 million and $7.4 million, respectively.

Fee revenue by segment

Executive search fee revenue by geography

Guidance

Korn Ferry expects second-quarter fee revenue to range between $470 million and $490 million.

Share price and market cap

Shares in Korn Ferry fell 21.99% to $49.90 as of 1:19 p.m. Eastern time today. The company had a market cap of $2.866 billion.

Multiple generations of workers coexisting in today’s labor force have different views on the use of technology and carry stereotypes about their older or younger colleagues, according to a new CompTIA report. However, they are in general agreement when it comes to career aspirations.

The nonprofit technology association’s report, “Managing the Multigenerational Workforce,” examines how generational issues are changing workforce dynamics.

CompTIA surveyed approximately 1,000 business professionals across a wide range of ages — in some cases, 40 years or more. The generations agreed on career aspirations: 65% of all respondents want to achieve financial security, 51% want to do work that they feel passionate about, and 49% would like to achieve a work/life balance.   

However, the report also identifies other areas of conflict and differing opinions among the generations that can have management implications for employers.

Millennials embrace technology: A company’s technology capabilities play an important role in attracting the best talent, especially for younger employees. Among millennials, 71% said that the degree to which an organization embraces technology and innovation is a factor in influencing where they work. That compares to 66% among Gen Xers and 53% for baby boomers.

Cloud-based applications continue to make gains: When it comes to the use of software applications for work-related purposes, 51% of millennials report using online/cloud-based tools for word processing and spreadsheets, compared to 33% of baby boomers. Use of collaboration tools such as Slack and Dropbox is higher among younger workers. Millennials are also looking for the faster implementation of new technologies. Older employees want more of a focus on making existing technologies more user-friendly.

Workplace stereotypes persist: The generations clearly do not view the workplace in the same way. Stereotypes about different generations’ work habits persist. For example, nearly two-thirds of baby boomers believe younger workers are not as loyal; and nearly six in 10 said younger workers feel more entitled. Just over half of millennials think older workers are too rigid and set in their ways. Nearly half of Gen Xers surveyed said older workers are not as skilled when it comes to using technology.

Volt Information Sciences Inc. (NYSE MKT: VISI) reported net revenue fell 11.1% in its fiscal third quarter ended July 29. On a same-store and constant currency basis, net revenue fell 6.6% year over year, excluding net revenue contributed from businesses sold or exited during the past year.

Gross margin narrowed to 14.1% from 15.8%, and net loss increased.

The New York-based firm also reported $3.1 million in restructuring and severance costs during the quarter.

Volt last month added two executives to Volt Workforce Solutions: Lori Schultz as COO and Lauren Griffin as senior VP, specialty solutions group. Both women come to the firm from Adecco and will join Volt’s senior leadership team.

In July, Volt formed a strategic solutions group and a global solutions group; in June, the company announced it was evaluating potential strategic alternatives and President and CEO Michael Dean left the company; Linda Perneau took over as interim CEO.

Quote

“I see significant opportunities to enhance Volt’s competitive position within the staffing industry and improve performance to levels of which we can be proud,” Perneau said. “Key to achieving this will be returning our largest business, Volt Workforce Solutions, to a trajectory of profitable growth.”

Perneau continued, “To address the challenges, our leadership team is currently focused on four strategic priorities of organization design, business optimization, delivery excellence, and growth and expansion.”

Segment revenue

• North America staffing services revenue fell 6.0% from the year-ago quarter, driven by lower demand from customers in the professional and administrative and office job categories, partially offset by growth in the light industrial and engineering job categories.
• International staffing services revenue — which includes the company’s contingent staffing, direct placement and managed programs business in Europe and Asia — edged down 1.5%. Third-quarter revenue fell 1.8% on a constant currency basis (and when excluding an $800,000 decrease related to an exited business) primarily due to lower demand in the United Kingdom, offset by strong growth in Belgium.
• “Corporate and other revenue,” which primarily consists of the company’s North American managed service business and its call center business, fell 56.8%, primarily due to the impact of the $66 million sale of its quality assurance testing business, which occurred at the end of the fourth quarter of fiscal 2017. On a same-store basis, excluding businesses sold or exited, the decline was 25.2% year over year, as a result of winding down of certain customer programs in the company’s managed service business as well as normal fluctuations in call center activity.

Share price and market cap

Shares in Volt fell 8.20% to $2.80 as of 1:16 p.m. Eastern time today. The company had a market cap of $58.9 million.

Following two months of increases, the number of jobs in Canada fell by 51,600 in August when compared to July for a total of 18.6 million jobs, according to seasonally adjusted numbers released today by Statistics Canada. The unemployment rate rose to 6.0% from 5.8% in July.

The job losses came in part-time employment, where the number of jobs fell by 92,000. That was partially offset a gain of 40,400 full-time jobs in August. A majority of the job losses also happened in the public sector, which lost 38,000 jobs. The number of private sector employees and self-employed workers was little changed.

In August, employment decreased in professional, scientific and technical services; wholesale and retail trade; and construction. At the same time, employment was up in business, building and other support services.

The goods-producing sector lost 30,400 in August compared to July, and the services-producing sector lot 21,200 jobs.

Employment declined in Ontario and increased in Alberta and Manitoba. Employment was little changed in the other provinces. Ontario lost 80,700 part-time jobs in August with employment at full-time jobs little changed.

The unemployment rate in Ontario rate rose to 5.7% August from 5.4% in July.

Interim HealthCare Inc. — a home care, hospice and health staffing franchise firm —  appointed Tracy Clark to COO. Clark joined the company in 2017 as senior VP of operations and sales. He previously held positions as president and principal at Triple Threat Management; as CEO at Family Private Care and Ambassador Health Services; and as executive VP at OMNI Home Care.

Source2, an Orlando, Fla.-based recruitment process outsourcing company, named Jeff Kitchens of Atlanta as executive VP of business development, RPO services. Kitchens has more than 20 years of RPO and management experience.

Newburyport, Mass.-based Koya Leadership Partners, a retained executive search firm serving the nonprofit sector, hired Naree Viner as a managing director. Based in the New York City area, Vine will work with museum clients and others in Koya’s art and culture portfolio. Viner has nearly 15 years of executive recruiting experience.

ZRG Partners announced Alex Bennett joined the executive search firm as a managing director and chief growth officer. He will work in the firm’s London office. Prior to joining ZRG, Bennett was CEO of RSA Group, a London-based life science search boutique.

DRG Search, a New York-based executive search firm for nonprofit organizations nationwide, appointed Amichaim Abramson to the newly created position of chief strategy officer, effective last Wednesday

Vitamin T, a talent agency for digital creatives, hired two new regional leaders. Matt Pozos, Northwest regional VP, most recently was director at Cielo Talent. Jack Fellers, Northeast regional VP, most recently was managing director – technical solutions at DISYS.

Executive search firm Russell Reynolds Associates selected three new consultants to join the firm’s executive committee: Justin Cerilli, Nada Usina and Ulrike Wieduwilt. The firm’s executive committee consists of nine consultants elected by their peers to help supervise the policies of the firm. Three new members are elected annually to serve a three-year term.