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Korn Ferry Q4 fee revenue $490.8 million

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Christian Fernsby |
Korn Ferry
Korn Ferry   Net income attributable to Korn Ferry was $50.3 million

Korn Ferry announced fourth quarter and annual fee revenue of $490.8 million and $1,926.0 million, respectively.

In addition, fourth quarter diluted earnings per share was $0.89 and Adjusted diluted earnings per share was $0.88.

Korn Ferry reported fee revenue in Q4 FY'19 of $490.8 million, an increase of 3% (8% increase on a constant currency basis) compared to Q4 FY'18.

The increase in fee revenue was mainly due to organic growth in RPO and Professional Search of 20%.

Net income attributable to Korn Ferry was $50.3 million in Q4 FY'19 as compared to $41.2 million in Q4 FY'18.

The increase in net income attributable to Korn Ferry resulted from an increase in fee revenue partially offset by an increase in compensation and benefits primarily due to an increase in average headcount and an increase in general and administrative expenses.

Operating income was $62.3 million in Q4 FY'19 with an operating margin of 12.7% as compared to $64.2 million and 13.5%, respectively, in the year-ago quarter.

The decrease in operating income resulted from an increase in compensation and benefits and general and administrative expenses, partially offset by higher fee revenue.

The increase in compensation and benefits was primarily driven by an increase in amounts owed under certain deferred compensation and retirement plans due to increases in the fair value of participants' accounts in Q4 FY'19 compared to decreases in the year-ago quarter and to a lesser extent an increase in average headcount.

Adjusted EBITDA was $82.2 million in Q4 FY'19 with an Adjusted EBITDA margin of 16.7%, as compared to $75.6 million and 15.9%, respectively, in Q4 FY'18.

The increase in Adjusted EBITDA was impacted by higher fee revenue, partially offset by increases in compensation and benefits expense and general and administrative expenses.

The Company reported record fee revenue in FY'19 of $1,926.0 million, an increase of $158.8 million or 9% (12% increase on a constant currency basis) compared to FY'18.

Net income attributable to Korn Ferry was $102.7 million in FY'19 as compared to $133.8 million in FY'18.

The decrease in net income attributable to Korn Ferry was primarily due to the tradename write-off and an increase in compensation and benefits expense, partially offset by an increase in fee revenue and a lower income tax provision.

Operating income was $140.8 million in FY'19 with an operating margin of 7.3% compared to $208.4 million and 11.8% in FY'18.

The decrease in operating income was primarily due to the $106.6 million tradename write-off and an increase of $112.1 million in compensation and benefits expense, partially offset by an increase of $158.8 million in fee revenue.

Adjusted EBITDA was $311.0 million in FY'19 with Adjusted EBITDA margin of 16.1%, compared to $278.0 million and 15.7%, respectively, in the year-ago period.


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