Korn/Ferry 2Q profit falls, but beats Street view
LOS ANGELES (AP) — Staffing company Korn/Ferry International said Thursday that its fiscal second-quarter net income slid, pulled down by restructuring charges. But its adjusted earnings and its forecast for third-quarter earnings topped Wall Street's expectations.
The company also announced that it is buying Minneapolis-based staffing firm PDI Ninth House as it looks to grow its business. Korn/Ferry will pay $80 million in cash, with the possibility of up to an additional $15 million in cash paid if certain targets are met.
Korn/Ferry International earned $1.2 million, or 3 cents per share, for the three months ended Oct. 31 compared with $15.1 million, or 32 cents per share, a year earlier.
Removing restructuring charges of $15.5 million, earnings were 25 cents per share.
Analysts forecast earnings of 19 cents per share, according to a FactSet survey.
Revenue fell 3 percent to $204.8 million from $210 million as revenue from the executive recruitment segment dropped. Analysts expected $190 million.
For the third quarter, Korn/Ferry anticipates adjusted earnings between 26 cents and 34 cents per share. Wall Street predicts 21 cents per share.
Korn/Ferry said that the acquisition of PDI Ninth House will be financed with available cash and is expected to add to its earnings in the first year of ownership.
The buyout is expected to close by year's end.
Korn Ferry shares rose 4 cents to $14.52 in morning trading Thursday. They have traded in a 52-week range of $12.10 to $18.75.
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