Robert Half : Reports Fourth-Quarter And Year-End Financial Results

MENLO PARK, Calif., Jan. 30, 2020 /PRNewswire/ -- Robert Half International Inc. (NYSE: RHI) today reported revenues and earnings for the fourth quarter and year ended December 31, 2019.

For the quarter ended December 31, 2019, net income was $113 million, or $.98 per share, on revenues of $1.537 billion. Net income for the prior year's fourth quarter was $114 million, or $.95 per share, on revenues of $1.482 billion.

For the year ended December 31, 2019, net income was $454 million, or $3.90 per share, on revenues of $6.074 billion. For the year ended December 31, 2018, net income was $434 million, or $3.57 per share, on revenues of $5.800 billion.

"We ended 2019 with continued strength in the U.S. job market and solid demand for our professional staffing and consulting services," said M. Keith Waddell, Chief Executive Officer of Robert Half. "We are particularly pleased with how Protiviti performed during the quarter. Our Robert Half Technology and Robert Half Management Resources divisions also turned in solid results, largely due to ongoing talent shortages in the professional disciplines they serve."

Waddell added, "Return on invested capital for the company was 40 percent in the fourth quarter."

Robert Half management will conduct a conference call today at 5 p.m. EST. The prepared remarks for this call are available now in the Investor Center of the Robert Half website (www.roberthalf.com/investor-center). Simply click on the Quarterly Conference Calls link. The dial-in number to listen to today's conference call is 877-814-0475 ([phone] outside the United States). The password is "Robert Half."

A taped recording of this call will be available for replay beginning at approximately 8 p.m. EST today and ending at 11:59 p.m. EST on March 1. The dial-in number for the replay is 855-859-2056 ([phone] outside the United States). To access the replay, enter conference ID# 5398663. The conference call also will be archived in audio format on the company's website at www.roberthalf.com/investor-center.

Founded in 1948, Robert Half is the world's first and largest specialized staffing firm and a recognized leader in professional consulting and staffing services. The company's specialized staffing divisions include Accountemps^®, Robert Half^® Finance & Accounting and Robert Half^® Management Resources, for temporary, full-time and senior-level project professionals, respectively, in the fields of accounting and finance; OfficeTeam^®, for highly skilled administrative support professionals; Robert Half^® Technology, for project and full-time technology professionals; Robert Half^® Legal, for project and full-time staffing of lawyers, paralegals and legal support personnel; and The Creative Group^®, for creative, digital, marketing, advertising and public relations professionals. Robert Half also is the parent company of Protiviti^®, a global consulting firm that provides clients with consulting solutions in finance, technology, operations, data, analytics, governance, risk and internal audit.

Robert Half has staffing and consulting operations in more than 400 locations worldwide.

Certain information contained in this press release and its attachments may be deemed forward-looking statements regarding events and financial trends that may affect the company's future operating results or financial positions. These statements may be identified by words such as "estimate", "forecast", "project", "plan", "intend", "believe", "expect", "anticipate", or variations or negatives thereof, or by similar or comparable words or phrases. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the statements.

These risks and uncertainties include, but are not limited to, the following: changes to or new interpretations of U.S. or international tax regulations; the global financial and economic situation; changes in levels of unemployment and other economic conditions in the United States or foreign countries where the company does business, or in particular regions or industries; reduction in the supply of candidates for temporary employment or the company's ability to attract candidates; the entry of new competitors into the marketplace or expansion by existing competitors; the ability of the company to maintain existing client relationships and attract new clients in the context of changing economic or competitive conditions; the impact of competitive pressures, including any change in the demand for the company's services, on the company's ability to maintain its margins; the possibility of the company incurring liability for its activities, including the activities of its temporary employees, or for events impacting its temporary employees on clients' premises; the possibility that adverse publicity could impact the company's ability to attract and retain clients and candidates; the success of the company in attracting, training, and retaining qualified management personnel and other staff employees; the company's ability to comply with governmental regulations affecting personnel services businesses in particular or employer/employee relationships in general; whether there will be ongoing demand for Sarbanes-Oxley or other regulatory compliance services; the company's reliance on short-term contracts for a significant percentage of its business; litigation relating to prior or current transactions or activities, including litigation that may be disclosed from time to time in the company's SEC filings; the ability of the company to manage its international operations and comply with foreign laws and regulations; the impact of fluctuations in foreign currency exchange rates; the possibility that the additional costs the company will incur as a result of healthcare reform legislation may adversely affect the company's profit margins or the demand for the company's services; the possibility that the company's computer and communications hardware and software systems could be damaged or their service interrupted; and the possibility that the company may fail to maintain adequate financial and management controls and as a result suffer errors in its financial reporting.

Additionally, with respect to Protiviti, other risks and uncertainties include the fact that future success will depend on its ability to retain employees and attract clients; there can be no assurance that there will be ongoing demand for Sarbanes-Oxley or other regulatory compliance services; failure to produce projected revenues could adversely affect financial results; and there is the possibility of involvement in litigation relating to prior or current transactions or activities.

Because long-term contracts are not a significant part of the company's business, future results cannot be reliably predicted by considering past trends or extrapolating past results. The company undertakes no obligation to update information contained in this release.

A copy of this release is available at www.roberthalf.com/investor-center.

ATTACHED:						Summary of Operations
						Supplemental Financial Information
						Non-GAAP Financial Measures

 

ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
SUMMARY OF OPERATIONS
(in thousands, except per share amounts)
		Quarter Ended December 31,								Year Ended December 31,
		2019				2018				2019				2018
		(Unaudited)								(Unaudited)
Service revenues		$	1,537,385			$	1,481,658			$	6,074,432			$	5,800,271
Costs of services		898,441				861,596				3,543,913				3,390,257
Gross margin		638,944				620,062				2,530,519				2,410,014
Selling, general and administrative expenses		485,716				466,153				1,908,768				1,821,089
Amortization of intangible assets		339				371				1,361				1,705
Interest income, net		(1,357)				(1,445)				(5,125)				(4,382)
Income before income taxes		154,246				154,983				625,515				591,602
Provision for income taxes		41,404				41,419				171,082				157,314
Net income		$	112,842			$	113,564			$	454,433			$	434,288
Diluted net income per share		$	.98			$	.95			$	3.90			$	3.57
Shares:
Basic		114,034				118,736				115,656				120,513
Diluted		114,862				119,851				116,411				121,602

 

	ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
	SUPPLEMENTAL FINANCIAL INFORMATION
	(in thousands)
			Quarter Ended December 31,														Year Ended December 31,
			2019							2018							2019							2018
			(Unaudited)														(Unaudited)
SERVICE REVENUES:
	Accountemps		$	486,249			31.6	%		$	483,487			32.6	%		$	1,946,404			32.0	%		$	1,915,054			33.1	%
	OfficeTeam		258,331				16.8	%		268,489				18.1	%		1,037,341				17.1	%		1,063,238				18.3	%
	Robert Half Technology		185,964				12.2	%		174,829				11.8	%		722,535				11.9	%		682,889				11.8	%
	Robert Half Management Resources		175,781				11.4	%		165,733				11.2	%		705,845				11.6	%		669,385				11.5	%
	Robert Half Finance & Accounting		126,394				8.2	%		125,884				8.5	%		533,432				8.8	%		511,989				8.8	%
	Protiviti		304,666				19.8	%		263,236				17.8	%		1,128,875				18.6	%		957,716				16.5	%
	Total		$	1,537,385			100.0	%		$	1,481,658			100.0	%		$	6,074,432			100.0	%		$	5,800,271			100.0	%
GROSS MARGIN:
	Temporary and consultant staffing		$	420,248			38.0	%		$	414,920			38.0	%		$	1,677,489			38.0	%		$	1,629,645			37.6	%
	Permanent placement staffing		126,135				99.8	%		125,637				99.8	%		532,435				99.8	%		511,046				99.8	%
	Risk consulting and internal audit services		92,561				30.4	%		79,505				30.2	%		320,595				28.4	%		269,323				28.1	%
	Total		$	638,944			41.6	%		$	620,062			41.8	%		$	2,530,519			41.7	%		$	2,410,014			41.6	%
OPERATING INCOME:
	Temporary and consultant staffing		$	97,469			8.8	%		$	101,800			9.3	%		$	410,153			9.3	%		$	404,800			9.3	%
	Permanent placement staffing		15,167				12.0	%		18,091				14.4	%		83,885				15.7	%		90,801				17.7	%
	Risk consulting and internal audit services		40,592				13.3	%		34,018				12.9	%		127,713				11.3	%		93,324				9.7	%
	Total		$	153,228			10.0	%		$	153,909			10.4	%		$	621,751			10.2	%		$	588,925			10.2	%
SELECTED CASH FLOW INFORMATION:
	Depreciation		$	15,779						$	15,900						$	64,264						$	64,244
	Capital expenditures		$	14,326						$	15,298						$	59,464						$	42,484
	Open market repurchases of common stock (shares)		988							2,359							4,253							5,614

 

	ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
	SUPPLEMENTAL FINANCIAL INFORMATION
	(in thousands)
			December 31,
			2019				2018
			(Unaudited)
SELECTED BALANCE SHEET INFORMATION:
	Cash and cash equivalents		$	270,478			$	276,579
	Accounts receivable, less allowances		$	832,797			$	794,446
	Total assets		$	2,311,408			$	1,903,097
	Total current liabilities		$	940,692			$	819,536
	Notes payable, less current portion		$	239			$	457
	Total stockholders' equity		$	1,143,683			$	1,063,198

ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES

The financial results of Robert Half International Inc. (the "Company") are prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") and the rules of the U.S. Securities and Exchange Commission ("SEC"). To help readers understand the Company's financial performance, the Company supplements its GAAP financial results with revenue growth rates derived from non-GAAP revenue amounts.

Variations in the Company's financial results include the impact of changes in foreign currency exchange rates, billing days, and certain intercompany adjustments. The Company provides "as adjusted" revenue growth calculations to remove the impact of these items. These calculations show the year-over-year revenue growth rates for the Company's lines of business on both a reported basis and also on an as adjusted basis for global, U.S., and international operations. This information is presented for each of the six most recent quarters. The Company has provided this data because it focuses on the Company's revenue growth rates attributable to operating activities and aids in evaluating revenue trends over time. The Company expresses year-over-year revenue changes as calculated percentages using the same number of billing days, constant currency exchange rates, and certain intercompany adjustments.

The non-GAAP financial measures provided herein may not provide information that is directly comparable to that provided by other companies in the Company's industry, as other companies may calculate such financial results differently. The Company's non-GAAP financial measures are not measurements of financial performance under GAAP and should not be considered as alternatives to actual revenue growth derived from revenue amounts presented in accordance with GAAP. The Company does not consider these non-GAAP financial measures to be a substitute for, or superior to, the information provided by GAAP financial results. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures is provided on the following pages.

ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
REVENUE GROWTH RATES (%) (UNAUDITED):
			Year-Over-Year Growth Rates (As Reported)												Non-GAAP Year-Over-Year Growth Rates (As Adjusted)
			2018				2019								2018				2019
			Q3		Q4		Q1		Q2		Q3		Q4		Q3		Q4		Q1		Q2		Q3		Q4
Global
	Accountemps		8.1		8.4		2.5		1.3		2.1		0.6		8.6		8.7		5.6		2.8		1.6		1.1
	OfficeTeam		7.7		4.0		-3.5		-2.7		0.3		-3.8		7.8		4.1		-0.4		-1.2		-0.1		-3.2
	RH Technology		12.4		11.4		7.4		4.6		4.9		6.4		12.6		11.4		10.7		6.4		4.8		7.2
	RH Management Resources		2.8		4.1		2.1		4.6		9.2		6.1		8.1		9.1		14.3		12.0		12.9		9.4
	Temporary and consultant staffing		7.9		7.1		1.7		1.4		3.2		1.3		8.9		8.0		6.2		3.7		3.4		2.2
	Permanent placement staffing		16.5		12.8		8.4		4.3		3.8		0.4		17.4		13.5		12.3		6.2		3.4		0.9
	Total staffing		8.7		7.6		2.4		1.7		3.3		1.2		9.8		8.5		6.9		4.0		3.4		2.1
	Protiviti		21.2		22.8		21.5		16.6		18.3		15.7		17.5		19.2		17.3		13.8		14.6		14.1
	Total		10.7		10.1		5.2		4.1		5.9		3.8		11.1		10.3		8.5		5.6		5.4		4.3
United States
	Temporary and consultant staffing		6.8		7.4		3.4		3.5		5.7		3.0		6.5		6.3		5.1		3.8		4.5		3.2
	Permanent placement staffing		17.0		16.4		10.0		6.6		6.5		3.0		16.7		15.3		11.8		6.9		5.3		3.2
	Total staffing		7.7		8.1		4.0		3.8		5.8		3.0		7.4		7.1		5.7		4.1		4.5		3.2
	Protiviti		17.3		17.6		14.9		14.7		17.5		17.3		17.1		16.4		16.8		15.1		16.2		17.5
	Total		9.3		9.7		5.7		5.6		7.9		5.6		9.0		8.7		7.4		6.0		6.6		5.7
International
	Temporary and consultant staffing		11.6		6.1		-3.7		-5.9		-5.0		-4.8		17.8		14.1		10.2		3.1		-0.2		-1.0
	Permanent placement staffing		15.4		5.6		4.9		-0.6		-2.1		-5.3		18.8		10.4		12.8		4.4		-0.6		-4.1
	Total staffing		12.1		6.0		-2.5		-5.1		-4.6		-4.8		17.9		13.6		10.5		3.3		-0.3		-1.5
	Protiviti		38.3		45.1		48.8		23.2		21.2		10.4		19.5		29.5		18.9		9.4		9.3		3.3
	Total		15.5		11.2		3.7		-1.0		-0.7		-2.2		18.2		16.0		11.9		4.4		1.4		-0.6

The non-GAAP financial measures included in the table above adjust for the following items:

Foreign Currency Translation. The "As Reported" revenue growth rates are based upon reported revenues, which include the impact of changes in foreign currency exchange rates. In order to calculate "Constant Currency" revenue growth rates, as-reported amounts are retranslated using foreign exchange rates from the prior year's comparable period.

Billing Days. The "As Reported" revenue growth rates are based upon reported revenues. Management calculates a global, weighted-average number of billing days for each reporting period based upon inputs from all countries and all lines of business. In order to remove the fluctuations caused by comparable periods having different billing days, the company calculates "same billing day" revenue growth rates by dividing each comparative period's reported revenues by the calculated number of billing days for that period to arrive at a "per billing day" amount. The "same billing day" growth rates are then calculated based upon the "per billing day" amounts.

Intercompany Adjustments. The "As Reported" revenue growth rates are based upon reported revenues. In order to remove the fluctuations caused by the impact of certain intercompany adjustments, applicable comparative period revenues are reclassified to conform with the current period presentation.

The term "As Adjusted" means that the impact of different billing days, constant currency fluctuations, and certain intercompany adjustments are removed from the revenue growth rate calculation. A reconciliation of the non-GAAP year-over-year revenue growth rates to the "As Reported" year-over-year revenue growth rates is included herein on Pages 8-10.

	ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
	NON-GAAP FINANCIAL MEASURES
	REVENUE GROWTH RATE (%) RECONCILIATION (UNAUDITED):
	Year-Over-Year Revenue Growth – GLOBAL
			Q3 2018			Q4 2018			Q1 2019			Q2 2019			Q3 2019			Q4 2019
Accountemps
	As Reported		8.1			8.4			2.5			1.3			2.1			0.6
	Billing Days Impact		-0.3			-0.7			1.4			0.3			-1.3			0.0
	Currency Impact		0.8			1.0			1.7			1.2			0.8			0.5
	As Adjusted		8.6			8.7			5.6			2.8			1.6			1.1
OfficeTeam
	As Reported		7.7			4.0			-3.5			-2.7			0.3			-3.8
	Billing Days Impact		-0.4			-0.7			1.3			0.2			-1.4			0.0
	Currency Impact		0.5			0.8			1.8			1.3			1.0			0.6
	As Adjusted		7.8			4.1			-0.4			-1.2			-0.1			-3.2
Robert Half Technology
	As Reported		12.4			11.4			7.4			4.6			4.9			6.4
	Billing Days Impact		-0.3			-0.9			1.4			0.3			-1.4			0.1
	Currency Impact		0.5			0.7			1.2			0.9			0.6			0.3
	Intercompany Adjustments		—			0.2			0.7			0.6			0.7			0.4
	As Adjusted		12.6			11.4			10.7			6.4			4.8			7.2
Robert Half Management Resources
	As Reported		2.8			4.1			2.1			4.6			9.2			6.1
	Billing Days Impact		-0.4			-0.8			1.5			0.2			-1.5			0.0
	Currency Impact		1.0			1.4			2.8			2.0			1.3			0.8
	Intercompany Adjustments		4.7			4.4			7.9			5.2			3.9			2.5
	As Adjusted		8.1			9.1			14.3			12.0			12.9			9.4
Temporary and consultant staffing
	As Reported		7.9			7.1			1.7			1.4			3.2			1.3
	Billing Days Impact		-0.4			-0.8			1.4			0.2			-1.3			0.0
	Currency Impact		0.7			1.0			1.8			1.3			0.9			0.5
	Intercompany Adjustments		0.7			0.7			1.3			0.8			0.6			0.4
	As Adjusted		8.9			8.0			6.2			3.7			3.4			2.2
Permanent placement staffing
	As Reported		16.5			12.8			8.4			4.3			3.8			0.4
	Billing Days Impact		-0.4			-0.7			1.4			0.2			-1.4			0.0
	Currency Impact		1.3			1.4			2.5			1.7			1.0			0.5
	As Adjusted		17.4			13.5			12.3			6.2			3.4			0.9
Total staffing
	As Reported		8.7			7.6			2.4			1.7			3.3			1.2
	Billing Days Impact		-0.4			-0.7			1.4			0.3			-1.4			0.0
	Currency Impact		0.8			1.0			1.9			1.3			0.9			0.5
	Intercompany Adjustments		0.7			0.6			1.2			0.7			0.6			0.4
	As Adjusted		9.8			8.5			6.9			4.0			3.4			2.1
Protiviti
	As Reported		21.2			22.8			21.5			16.6			18.3			15.7
	Billing Days Impact		-0.4			-0.8			1.5			0.3			-1.4			0.1
	Currency Impact		0.6			0.9			1.7			1.2			0.8			0.3
	Intercompany Adjustments		-3.9			-3.7			-7.4			-4.3			-3.1			-2.0
	As Adjusted		17.5			19.2			17.3			13.8			14.6			14.1
Total
	As Reported		10.7			10.1			5.2			4.1			5.9			3.8
	Billing Days Impact		-0.3			-0.8			1.4			0.2			-1.4			0.0
	Currency Impact		0.7			1.0			1.9			1.3			0.9			0.5
	As Adjusted		11.1			10.3			8.5			5.6			5.4			4.3

 

	ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
	NON-GAAP FINANCIAL MEASURES
	REVENUE GROWTH RATE (%) RECONCILIATION (UNAUDITED):
	Year-Over-Year Revenue Growth – UNITED STATES
			Q3 2018			Q4 2018			Q1 2019			Q2 2019			Q3 2019			Q4 2019
Temporary and consultant staffing
	As Reported		6.8			7.4			3.4			3.5			5.7			3.0
	Billing Days Impact		-0.3			-1.1			1.7			0.3			-1.2			0.2
	Currency Impact		—			—			—			—			—			—
	As Adjusted		6.5			6.3			5.1			3.8			4.5			3.2
Permanent placement staffing
	As Reported		17.0			16.4			10.0			6.6			6.5			3.0
	Billing Days Impact		-0.3			-1.1			1.8			0.3			-1.2			0.2
	Currency Impact		—			—			—			—			—			—
	As Adjusted		16.7			15.3			11.8			6.9			5.3			3.2
Total staffing
	As Reported		7.7			8.1			4.0			3.8			5.8			3.0
	Billing Days Impact		-0.3			-1.0			1.7			0.3			-1.3			0.2
	Currency Impact		—			—			—			—			—			—
	As Adjusted		7.4			7.1			5.7			4.1			4.5			3.2
Protiviti
	As Reported		17.3			17.6			14.9			14.7			17.5			17.3
	Billing Days Impact		-0.2			-1.2			1.9			0.4			-1.3			0.2
	Currency Impact		—			—			—			—			—			—
	As Adjusted		17.1			16.4			16.8			15.1			16.2			17.5
Total
	As Reported		9.3			9.7			5.7			5.6			7.9			5.6
	Billing Days Impact		-0.3			-1.0			1.7			0.4			-1.3			0.1
	Currency Impact		—			—			—			—			—			—
	As Adjusted		9.0			8.7			7.4			6.0			6.6			5.7

 

	ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
	NON-GAAP FINANCIAL MEASURES
	REVENUE GROWTH RATE (%) RECONCILIATION (UNAUDITED):
	Year-Over-Year Revenue Growth – INTERNATIONAL
			Q3 2018		Q4 2018		Q1 2019		Q2 2019		Q3 2019		Q4 2019
Temporary and consultant staffing
	As Reported		11.6		6.1		-3.7		-5.9		-5.0		-4.8
	Billing Days Impact		-0.5		0.4		0.4		-0.2		-1.6		-0.4
	Currency Impact		3.2		4.4		8.1		5.7		3.8		2.4
	Intercompany Adjustments		3.5		3.2		5.4		3.5		2.6		1.8
	As Adjusted		17.8		14.1		10.2		3.1		-0.2		-1.0
Permanent placement staffing
	As Reported		15.4		5.6		4.9		-0.6		-2.1		-5.3
	Billing Days Impact		-0.6		0.5		0.3		-0.2		-1.5		-0.4
	Currency Impact		4.0		4.3		7.6		5.2		3.0		1.6
	As Adjusted		18.8		10.4		12.8		4.4		-0.6		-4.1
Total staffing
	As Reported		12.1		6.0		-2.5		-5.1		-4.6		-4.8
	Billing Days Impact		-0.5		0.5		0.3		-0.2		-1.6		-0.6
	Currency Impact		3.3		4.4		8.0		5.6		3.7		2.3
	Intercompany Adjustments		3.0		2.7		4.7		3.0		2.2		1.6
	As Adjusted		17.9		13.6		10.5		3.3		-0.3		-1.5
Protiviti
	As Reported		38.3		45.1		48.8		23.2		21.2		10.4
	Billing Days Impact		-0.5		0.6		0.3		-0.1		-1.8		-0.6
	Currency Impact		2.7		4.2		7.1		5.0		3.5		1.4
	Intercompany Adjustments		-21.0		-20.4		-37.3		-18.7		-13.6		-7.9
	As Adjusted		19.5		29.5		18.9		9.4		9.3		3.3
Total
	As Reported		15.5		11.2		3.7		-1.0		-0.7		-2.2
	Billing Days Impact		-0.6		0.4		0.4		-0.1		-1.6		-0.5
	Currency Impact		3.3		4.4		7.8		5.5		3.7		2.1
	As Adjusted		18.2		16.0		11.9		4.4		1.4		-0.6

 

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SOURCE Robert Half