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Business Segments
 3 Months Ended
Jul. 31, 2013
Business Segments

8. Business Segments

The Company currently operates in three global businesses: Executive Recruitment, LTC and Futurestep. The Executive Recruitment segment focuses on recruiting Board of Director and C-level positions, in addition to research-based interviewing and onboarding solutions, for clients predominantly in the consumer, financial services, industrial, life sciences/healthcare and technology industries. LTC provides a comprehensive blend of leadership and talent management solutions including both consulting services and product offerings. Service and product offerings in this segment include: Leadership Strategy, Board, CEO and Top Team Effectiveness, Succession Planning, Assessment, Leadership and Employee Development, Diversity and Inclusion as well as a rich library of online learning modules. Futurestep is a global industry leader in high impact enterprise-wide consulting and recruitment solutions. Its portfolio of services includes recruitment process outsourcing, talent acquisition and management consulting services, project-based recruitment, non-executive recruitment and other professionals. The Executive Recruitment business segment is managed by geographic regional leaders LTC’s and Futurestep’s worldwide operations are managed by their respective Chief Executive Officers. The Executive Recruitment geographic regional leaders and the Chief Executive Officers of LTC and Futurestep report directly to the Chief Executive Officer of the Company. The Company also operates a Corporate segment to record global expenses of the Company.

The Company evaluates performance and allocates resources based on the Company’s chief operating decision maker’s (“CODM”) review of (1) fee revenue and (2) earnings before interest, taxes, depreciation and amortization (“EBITDA”), which is further adjusted to exclude restructuring charges (net of recoveries) and/or transaction, integration and certain separation costs (“Adjusted EBITDA”). The accounting policies for the reportable segments are the same as those described in the summary of significant accounting policies, except that unusual or infrequent items are excluded from Adjusted EBITDA.

 

Financial highlights by business segment are as follows:

 

    Three Months Ended July 31, 2013  
    Executive Recruitment                          
    North
America		     EMEA     Asia
Pacific		     South
America		     Subtotal     LTC     Futurestep     Corporate     Consolidated  
    (in thousands)  

Fee revenue

   $ 74,147      $ 34,377      $ 21,128      $ 7,003      $ 136,655      $ 60,062      $ 31,720      $ —        $ 228,437   

Total revenue

   $ 78,111      $ 35,457      $ 21,927      $ 7,036      $ 142,531      $ 62,082      $ 32,974      $ —        $ 237,587   

Net income

                   $ 11,417   

Other income, net

                     (2,267 ) 

Interest expense, net

                     591   

Income tax provision

                     7,385   

Equity in earnings of unconsolidated subsidiaries, net

                     (465 ) 
                 

 

 

  

Operating income (loss)

   $ 16,324      $ 5,960      $ 4,500      $ 1,496      $ 28,280      $ 4,335      $ 2,545      $ (18,499 )      16,661   

Depreciation and amortization

     963        435        306        74        1,778        2,897        408        861        5,944   

Other income, net

     127        234        17        3        381        8        565        1,313        2,267   

Equity in earnings of unconsolidated subsidiaries, net

     102        —          —          —          102        —          —          363        465   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA

     17,516        6,629        4,823        1,573        30,541        7,240        3,518        (15,962 )      25,337   

Restructuring charges, net

     816        460        60        —          1,336        1,149        1,134        63        3,682   

Separation costs

     —          —          —          —          —          —          —          2,500        2,500   

Integration costs

     —          —          —          —          —          —          —          394        394   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted EBITDA

   $ 18,332      $ 7,089      $ 4,883      $ 1,573      $ 31,877      $ 8,389      $ 4,652      $ (13,005 )    $ 31,913   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
    Three Months Ended July 31, 2012  
    Executive Recruitment                          
    North
America		     EMEA     Asia
Pacific		     South
America		     Subtotal     LTC     Futurestep     Corporate     Consolidated  
    (in thousands)  

Fee revenue

   $ 72,106      $ 29,823      $ 17,383      $ 8,134      $ 127,446      $ 28,392      $ 30,856      $ —        $ 186,694   

Total revenue

   $ 76,227      $ 30,870      $ 17,873      $ 8,251      $ 133,221      $ 29,844      $ 32,958      $ —        $ 196,023   

Net income

                   $ 10,418   

Other loss, net

                     1,017   

Interest expense, net

                     599   

Income tax provision

                     5,605   

Equity in earnings of unconsolidated subsidiaries, net

                     (630 ) 
                 

 

 

  

Operating income (loss)

   $ 18,074      $ 1,788      $ 498      $ 2,089      $ 22,449      $ 4,262      $ 3,182      $ (12,884 )      17,009   

Depreciation and amortization

     1,206        556        363        81        2,206        617        296        623        3,742   

Other income (loss), net

     (4 )      26        36        —          58        15        9        (1,099 )      (1,017 ) 

Equity in earnings of unconsolidated subsidiaries, net

     227        —          —          —          227        —          —          403        630   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA

     19,503        2,370        897        2,170        24,940        4,894        3,487        (12,957 )      20,364   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted EBITDA

   $ 19,503      $ 2,370      $ 897      $ 2,170      $ 24,940      $ 4,894      $ 3,487      $ (12,957 )    $ 20,364