LONDON, UK / ACCESSWIRE / September 13, 2016 / Active Wall St. announces its post-earnings coverage on Korn/Ferry International (NYSE: KFY). The company reported its first quarter fiscal 2017 (Q1 FY17) results on September 08th, 2016. The Los Angeles, California-based company reported that net income grew around 40% y-o-y; however its top- and bottom-line missed market expectations.

Register with us now for your free membership at: http://www.activewallst.com/register/.

Today, AWS is promoting its earnings coverage on KFY; touching on stocks like Engility Holdings, Inc., (NYSE: EGL) and Kelly Services, Inc. (NASDAQ: KELYA). Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=KFY

http://www.activewallst.com/registration-3/?symbol=EGL

Earnings Reviewed

In Q1 FY17, Korn/Ferry reported total revenue of $375.62 million, which came in above the $267.39 million in the year-ago period. The company attributed this y-o-y growth in total revenue to the acquisition of Hay Group in the third quarter of fiscal 2016. However, the company's total revenue fell short of analysts' estimate of $387.1 million.

For the three months ended on July 31, 2016, Korn/Ferry reported net income of $3.21 million, or $0.06 per diluted share, versus $23.08 million, or $0.46 per diluted share, in the year-ago quarter.

On an adjusted basis, the staffing company posted net income of $29.53 million, or $0.52 per diluted share, in Q1 FY17, which was higher than the $23.54 million, or $0.47 per diluted share, reported in Q1 FY16. The company's EPS also missed analysts' adjusted net income estimate of $0.53 per diluted share.

"Operationally, our combination with Hay Group and investments in our business have provided us with a more compelling platform to not only accelerate our clients' success, but accelerate Korn/Ferry's growth ? and generate stronger earnings power," said Gary D. Burnison, CEO of Korn/Ferry International.

Segment Results

During Q1 FY17, Korn/Ferry's fee revenues at its Executive Search segment fell to $146.36 million from $152.09 million in Q1 FY16. The lower fee revenue for the segment was due to a decline in fee revenues in North America, partially offset by an increase in Latin America.

Fee revenue at Hay Group segment was $174.58 million in Q1 FY17 compared to $69.24 million in Q1 FY17. The company attributed this year-over-year growth in fee revenue for the segment to Hay Group acquisition, which resulted in consulting fee revenue growth of $70.5 million.

The Executive search and advisory firm's Futurestep reported fee of $54.67 million, an increase of 18.7% y-o-y and 21.7% y-o-y on a constant currency basis. The higher fee revenue at the segment was due to $5.4 million increase in recruitment process outsourcing revenue and 14.2% y-o-y increase in engagements bills.

Operational Metrics

For Q1 FY17, Korn/Ferry's operating margin declined to 1.2% in Q1 FY17 from 12.3% in Q1 FY16. The company's EBITDA margin also fell to 5.4% in the reported period from 15.3% in the year ago period. The decrease in margins was primarily related to one-time restructuring charges of $24.5 million and integration-cum-acquisition costs of $7.3 million.

Liquidity

As of July 31, 2016, Korn/Ferry had cash and equivalents of $244.07 million compared to $273.25 million as of April 30, 2016. The company's term loan decreased to $19.75 million as of July, 31, 2016, from $30.00 million as at the close of books in the previous quarter.

Dividend Announcement

The company in its press release on September 07, 2016, announced a quarterly dividend of $0.10 per share, which will be payable on October 14, 2016, to stockholders of record on September 26, 2016.

Outlook

For Q2 FY17, Korn/Ferry is forecasting fee revenue in the range of $380 million and $400 million. The company is likely to post diluted earnings per share between $0.45 and $0.55 for the current quarter. Furthermore, adjusted diluted earnings per share for Q2 FY17 are expected to be in the range of $0.54 to $0.62.

Peer Performance

Engility Holdings, Inc., in its earnings release on August 01, 2016, had reported total revenue of $535.43 million for Q2 FY16 compared to $575.50 million in Q2 FY15. The company's GAAP net income in Q4 FY16 was $2.49 million, or $0.07 per diluted share, lower than GAAP net income of $13.10 million, or $0.35 per diluted share, recorded in the year-ago quarter.

On August 10, 2016, Kelly Services' total revenue fell 0.7% y-o-y in Q2 FY16 to $1.38 billion. The company reported net earnings of $8.9 million, or $0.23 per diluted share in its reported quarter compared to net earnings of $6.8 million, or $0.18 per share, during Q2 FY15.

Stock Performance

Korn/Ferry International's stock closed Monday's session at $22.76, flat for the day. Trading volume was 839.75 thousand shares, which was above the 3-month average volume of 715.5 thousand shares. The company's shares have a PE ratio of 39.31 and a dividend yield of 1.76%.

Active Wall Street:

Active Wall Street (AWS) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and micro-cap stocks. AWS has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.

AWS has not been compensated; directly or indirectly; for producing or publishing this document.

PRESS RELEASE PROCEDURES:

The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third party research service company (the "Reviewer") represented by a credentialed financial analyst, for further information on analyst credentials, please email info@activewallst.com. Rohit Tuli, a CFA® charterholder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by AWS. AWS is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.

NO WARRANTY

AWS, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. AWS, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, AWS, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.

NOT AN OFFERING

This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither AWS nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://www.activewallst.com/disclaimer/.

CONTACT

For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:

Email: info@activewallst.com

Phone number: 1-858-257-3144

Office Address: 3rd floor, 207 Regent Street, London, W1B 3HH, United Kingdom

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

SOURCE: Active Wall Street