Robert Half Reports Second-Quarter Financial Results

MENLO PARK, Calif., July 23, 2020 /PRNewswire/ — Robert Half International Inc. (NYSE: RHI) today reported revenues and earnings for…

MENLO PARK, Calif., July 23, 2020 /PRNewswire/ — Robert Half International Inc. (NYSE: RHI) today reported revenues and earnings for the second quarter ended June 30, 2020.

For the quarter ended June 30, 2020, net income was $46 million, or $.41 per share, on revenues of $1.108 billion. Net income for the prior year’s second quarter was $115 million, or $.98 per share, on revenues of $1.516 billion.

For the six months ended June 30, 2020, net income was $136 million, or $1.20 per share, on revenues of $2.615 billion. For the six months ended June 30, 2019, net income was $224 million, or $1.91 per share, on revenues of $2.985 billion.

“Robert Half’s second-quarter results were clearly affected by the economic crisis resulting from the COVID-19 pandemic, most acutely in our staffing business,” said M. Keith Waddell, president and CEO of Robert Half. “Protiviti had an outstanding quarter and continues to benefit from strong solutions offerings and pipeline. We are encouraged by recent signs of week-on-week sequential growth in our staffing operations, and, although significant uncertainty continues, we approach the third quarter with optimism.”

Robert Half management will conduct a conference call today at 5 p.m. EDT. 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 (+1-706-643-9224 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. EDT today and ending at 11:59 p.m. EDT on August 6. The dial-in number for the replay is 855-859-2056 (+1-404-537-3406 outside the United States). To access the replay, enter conference ID# 9295939. 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; the duration and impact of the COVID-19 pandemic and efforts to mitigate its spread; 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.

SUMMARY OF OPERATIONS

(in thousands, except per share amounts)



Quarter

Ended June 30,


Six Months

Ended June 30,


2020


2019


2020


2019


(Unaudited)


(Unaudited)









Service revenues

$

1,108,326



$

1,516,385



$

2,615,017



$

2,984,915


Costs of services

685,249



878,844



1,581,223



1,739,786










Gross margin

423,077



637,541



1,033,794



1,245,129










Selling, general and administrative expenses

364,828



478,139



844,401



939,498


Amortization of intangible assets

330



341



668



683


Interest income, net

(105)



(1,042)



(1,062)



(2,538)










Income before income taxes

58,024



160,103



189,787



307,486


Provision for income taxes

11,828



45,491



53,676



83,076










Net income

$

46,196



$

114,612



$

136,111



$

224,410










Diluted net income per share

$

.41



$

.98



$

1.20



$

1.91










Shares:








Basic

112,865



116,381



113,026



116,722


Diluted

113,121



116,988



113,489



117,475


 

ROBERT HALF INTERNATIONAL INC.

SUPPLEMENTAL FINANCIAL INFORMATION

(in thousands)




Quarter

Ended June 30,


Six Months

Ended June 30,



2020


2019


2020


2019



(Unaudited)


(Unaudited)

SERVICE REVENUES:

















Accountemps


$

322,596



29.1

%


$

486,992



32.1

%


$

803,037



30.7

%


$

970,465



32.5

%

OfficeTeam


132,730



12.0

%


261,034



17.2

%


371,766



14.2

%


513,069



17.2

%

Robert Half Technology


151,542



13.7

%


179,375



11.8

%


334,965



12.8

%


351,303



11.8

%

Roberth Half Management Resources


146,518



13.2

%


175,311



11.6

%


335,738



12.9

%


352,502



11.8

%

Robert Half Finance & Accounting


71,030



6.4

%


140,894



9.3

%


191,519



7.3

%


272,456



9.1

%

Protiviti


283,910



25.6

%


272,779



18.0

%


577,992



22.1

%


525,120



17.6

%

Total


$

1,108,326



100.0

%


$

1,516,385



100.0

%


$

2,615,017



100.0

%


$

2,984,915



100.0

%


















GROSS MARGIN:

















Temporary and consultant staffing


$

279,302



37.1

%


$

420,837



38.2

%


$

692,298



37.5

%


$

833,302



38.1

%

Permanent placement staffing


70,906



99.8

%


140,638



99.8

%


191,186



99.8

%


271,946



99.8

%

Risk consulting and internal audit services


72,869



25.7

%


76,066



27.9

%


150,310



26.0

%


139,881



26.6

%

Total


$

423,077



38.2

%


$

637,541



42.0

%


$

1,033,794



39.5

%


$

1,245,129



41.7

%


















OPERATING INCOME:

















Temporary and consultant staffing


$

28,390



3.8

%


$

105,238



9.5

%


$

122,154



6.6

%


$

211,256



9.7

%

Permanent placement staffing


(248)



(0.3)

%


25,344



18.0

%


10,663



5.6

%


46,901



17.2

%

Risk consulting and internal audit services


30,107



10.6

%


28,820



10.6

%


56,576



9.8

%


47,474



9.0

%

Total


$

58,249



5.3

%


$

159,402



10.5

%


$

189,393



7.2

%


$

305,631



10.2

%


















SELECTED CASH FLOW INFORMATION:

















Depreciation


$

15,596





$

16,088





$

31,509





$

31,740




Capital expenditures


$

7,988





$

15,955





$

22,264





$

28,625




Open market repurchases of common stock (shares)






1,031





983





1,812




 

ROBERT HALF INTERNATIONAL INC.

SUPPLEMENTAL FINANCIAL INFORMATION

(in thousands)




June 30,



2020


2019



(Unaudited)

SELECTED BALANCE SHEET INFORMATION:





Cash and cash equivalents


$

501,485



$

269,440


Accounts receivable, less allowances


$

665,409



$

842,294


Total assets


$

2,402,377



$

2,239,419


Total current liabilities


$

977,167



$

909,510


Notes payable, less current portion


$

122



$

350


Total stockholders’ equity


$

1,156,706



$

1,109,227


 

ROBERT HALF INTERNATIONAL INC.

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.

NON-GAAP FINANCIAL MEASURES


REVENUE GROWTH RATES (%) (UNAUDITED): 




Year-Over-Year Growth Rates

(As Reported)


Non-GAAP Year-Over-Year Growth Rates

(As Adjusted)



2019


2020


2019


2020



Q1


Q2


Q3


Q4


Q1


Q2


Q1


Q2


Q3


Q4


Q1


Q2

Global

























Accountemps


2.5


1.3


2.1


0.6


-0.6


-33.8


5.6


2.8


1.6


1.1


-1.3


-33.1

OfficeTeam


-3.5


-2.7


0.3


-3.8


-5.2


-49.2


-0.4


-1.2


-0.1


-3.2


-5.9


-48.9

RH Technology


7.4


4.6


4.9


6.4


6.7


-15.5


10.7


6.4


4.8


7.2


5.7


-15.2

RH Management Resources


2.1


4.6


9.2


6.1


6.8


-16.4


14.3


12.0


12.9


9.4


6.3


-15.7

Temporary and consultant staffing


1.7


1.4


3.2


1.3


0.7


-31.7


6.2


3.7


3.4


2.2


0.0


-31.2

Permanent placement staffing


8.4


4.3


3.8


0.4


-8.4


-49.6


12.3


6.2


3.4


0.9


-9.0


-49.1

Total staffing


2.4


1.7


3.3


1.2


-0.3


-33.7


6.9


4.0


3.4


2.1


-1.0


-33.2

Protiviti


21.5


16.6


18.3


15.7


16.5


4.1


17.3


13.8


14.6


14.1


15.5


4.5

Total


5.2


4.1


5.9


3.8


2.6


-26.9


8.5


5.6


5.4


4.3


1.9


-26.4


























United States























Temporary and consultant staffing


3.4


3.5


5.7


3.0


2.0


-31.7


5.1


3.8


4.5


3.2


0.5


-31.7

Permanent placement staffing


10.0


6.6


6.5


3.0


-4.9


-51.6


11.8


6.9


5.3


3.2


-6.3


-51.6

Total staffing


4.0


3.8


5.8


3.0


1.3


-33.7


5.7


4.1


4.5


3.2


-0.2


-33.7

Protiviti


14.9


14.7


17.5


17.3


21.3


6.4


16.8


15.1


16.2


17.5


19.5


6.3

Total


5.7


5.6


7.9


5.6


4.7


-26.5


7.4


6.0


6.6


5.7


3.2


-26.5


























International























Temporary and consultant staffing


-3.7


-5.9


-5.0


-4.8


-3.8


-31.8


10.2


3.1


-0.2


-1.0


-1.9


-28.9

Permanent placement staffing


4.9


-0.6


-2.1


-5.3


-15.9


-45.0


12.8


4.4


-0.6


-4.1


-14.6


-43.2

Total staffing


-2.5


-5.1


-4.6


-4.8


-5.6


-33.8


10.5


3.3


-0.3


-1.5


-3.7


-31.1

Protiviti


48.8


23.2


21.2


10.4


1.3


-3.9


18.9


9.4


9.3


3.3


2.4


-1.5

Total


3.7


-1.0


-0.7


-2.2


-4.4


-28.4


11.9


4.4


1.4


-0.6


-2.7


-25.7

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.

NON-GAAP FINANCIAL MEASURES


REVENUE GROWTH RATE (%) RECONCILIATION (UNAUDITED)


Year-Over-Year Revenue Growth – GLOBAL



Q1 2019


Q2 2019


Q3 2019


Q4 2019


Q1 2020


Q2 2020

Accountemps

















As Reported


2.5



1.3



2.1



0.6



-0.6



-33.8


Billing Days Impact


1.4



0.3



-1.3



0.0



-1.5



-0.1


Currency Impact


1.7



1.2



0.8



0.5



0.8



0.8


As Adjusted


5.6



2.8



1.6



1.1



-1.3



-33.1


OfficeTeam













As Reported


-3.5



-2.7



0.3



-3.8



-5.2



-49.2


Billing Days Impact


1.3



0.2



-1.4



0.0



-1.3



0.0


Currency Impact


1.8



1.3



1.0



0.6



0.6



0.3


As Adjusted


-0.4



-1.2



-0.1



-3.2



-5.9



-48.9


Robert Half Technology













As Reported


7.4



4.6



4.9



6.4



6.7



-15.5


Billing Days Impact


1.4



0.3



-1.4



0.1



-1.5



-0.2


Currency Impact


1.2



0.9



0.6



0.3



0.5



0.5


Intercompany Adjustments


0.7



0.6



0.7



0.4






As Adjusted


10.7



6.4



4.8



7.2



5.7



-15.2


Robert Half Management Resources













As Reported


2.1



4.6



9.2



6.1



6.8



-16.4


Billing Days Impact


1.5



0.2



-1.5



0.0



-1.5



-0.2


Currency Impact


2.8



2.0



1.3



0.8



1.0



0.9


Intercompany Adjustments


7.9



5.2



3.9



2.5






As Adjusted


14.3



12.0



12.9



9.4



6.3



-15.7


Temporary and consultant staffing













As Reported


1.7



1.4



3.2



1.3



0.7



-31.7


Billing Days Impact


1.4



0.2



-1.3



0.0



-1.4



-0.1


Currency Impact


1.8



1.3



0.9



0.5



0.7



0.6


Intercompany Adjustments


1.3



0.8



0.6



0.4






As Adjusted


6.2



3.7



3.4



2.2



0.0



-31.2


Permanent placement staffing













As Reported


8.4



4.3



3.8



0.4



-8.4



-49.6


Billing Days Impact


1.4



0.2



-1.4



0.0



-1.4



-0.1


Currency Impact


2.5



1.7



1.0



0.5



0.8



0.6


As Adjusted


12.3



6.2



3.4



0.9



-9.0



-49.1


Total staffing













As Reported


2.4



1.7



3.3



1.2



-0.3



-33.7


Billing Days Impact


1.4



0.3



-1.4



0.0



-1.4



-0.1


Currency Impact


1.9



1.3



0.9



0.5



0.7



0.6


Intercompany Adjustments


1.2



0.7



0.6



0.4






As Adjusted


6.9



4.0



3.4



2.1



-1.0



-33.2


Protiviti













As Reported


21.5



16.6



18.3



15.7



16.5



4.1


Billing Days Impact


1.5



0.3



-1.4



0.1



-1.6



-0.1


Currency Impact


1.7



1.2



0.8



0.3



0.6



0.5


Intercompany Adjustments


-7.4



-4.3



-3.1



-2.0






As Adjusted


17.3



13.8



14.6



14.1



15.5



4.5


Total













As Reported


5.2



4.1



5.9



3.8



2.6



-26.9


Billing Days Impact


1.4



0.2



-1.4



0.0



-1.4



-0.1


Currency Impact


1.9



1.3



0.9



0.5



0.7



0.6


As Adjusted


8.5



5.6



5.4



4.3



1.9



-26.4


 

ROBERT HALF INTERNATIONAL INC.

NON-GAAP FINANCIAL MEASURES


REVENUE GROWTH RATE (%) RECONCILIATION (UNAUDITED):


Year-Over-Year Revenue Growth – UNITED STATES



Q1 2019


Q2 2019


Q3 2019


Q4 2019


Q1 2020


 Q2 2020

Temporary and consultant staffing


















As Reported


3.4



3.5



5.7



3.0



2.0



-31.7


Billing Days Impact


1.7



0.3



-1.2



0.2



-1.5



0.0


Currency Impact













As Adjusted


5.1



3.8



4.5



3.2



0.5



-31.7















Permanent placement staffing













As Reported


10.0



6.6



6.5



3.0



-4.9



-51.6


Billing Days Impact


1.8



0.3



-1.2



0.2



-1.4



0.0


Currency Impact













As Adjusted


11.8



6.9



5.3



3.2



-6.3



-51.6















Total staffing













As Reported


4.0



3.8



5.8



3.0



1.3



-33.7


Billing Days Impact


1.7



0.3



-1.3



0.2



-1.5



0.0


Currency Impact













As Adjusted


5.7



4.1



4.5



3.2



-0.2



-33.7















Protiviti













As Reported


14.9



14.7



17.5



17.3



21.3



6.4


Billing Days Impact


1.9



0.4



-1.3



0.2



-1.8



-0.1


Currency Impact













As Adjusted


16.8



15.1



16.2



17.5



19.5



6.3















Total













As Reported


5.7



5.6



7.9



5.6



4.7



-26.5


Billing Days Impact


1.7



0.4



-1.3



0.1



-1.5



0.0


Currency Impact













As Adjusted


7.4



6.0



6.6



5.7



3.2



-26.5


 

ROBERT HALF INTERNATIONAL INC.

NON-GAAP FINANCIAL MEASURES


REVENUE GROWTH RATE (%) RECONCILIATION (UNAUDITED):


Year-Over-Year Revenue Growth – INTERNATIONAL



Q1 2019


Q2 2019


Q3 2019


Q4 2019


Q1 2020


 Q2 2020

Temporary and consultant staffing


















As Reported


-3.7



-5.9



-5.0



-4.8



-3.8



-31.8


Billing Days Impact


0.4



-0.2



-1.6



-0.4



-1.4



0.0


Currency Impact


8.1



5.7



3.8



2.4



3.3



2.9


Intercompany Adjustments


5.4



3.5



2.6



1.8






As Adjusted


10.2



3.1



-0.2



-1.0



-1.9



-28.9















Permanent placement staffing













As Reported


4.9



-0.6



-2.1



-5.3



-15.9



-45.0


Billing Days Impact


0.3



-0.2



-1.5



-0.4



-1.1



-0.1


Currency Impact


7.6



5.2



3.0



1.6



2.4



1.9


As Adjusted


12.8



4.4



-0.6



-4.1



-14.6



-43.2















Total staffing













As Reported


-2.5



-5.1



-4.6



-4.8



-5.6



-33.8


Billing Days Impact


0.3



-0.2



-1.6



-0.6



-1.3



-0.1


Currency Impact


8.0



5.6



3.7



2.3



3.2



2.8


Intercompany Adjustments


4.7



3.0



2.2



1.6






As Adjusted


10.5



3.3



-0.3



-1.5



-3.7



-31.1















Protiviti













As Reported


48.8



23.2



21.2



10.4



1.3



-3.9


Billing Days Impact


0.3



-0.1



-1.8



-0.6



-1.4



0.0


Currency Impact


7.1



5.0



3.5



1.4



2.5



2.4


Intercompany Adjustments


-37.3



-18.7



-13.6



-7.9






As Adjusted


18.9



9.4



9.3



3.3



2.4



-1.5















Total













As Reported


3.7



-1.0



-0.7



-2.2



-4.4



-28.4


Billing Days Impact


0.4



-0.1



-1.6



-0.5



-1.3



0.0


Currency Impact


7.8



5.5



3.7



2.1



3.0



2.7


As Adjusted


11.9



4.4



1.4



-0.6



-2.7



-25.7


 

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SOURCE Robert Half