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Heidrick & Struggles (HSII) Reports 2009 Third Quarter Financial Results

CHICAGO, Oct. 27, 2009 (GLOBE NEWSWIRE) — Heidrick & Struggles International, Inc. (Nasdaq:HSII), a premier leadership advisory firm providing executive search and leadership consulting services worldwide, today announced financial results for the third quarter ended September 30, 2009.

Consolidated net revenue of $103.5 million declined 34.6 percent from $158.3 million in the 2008 third quarter, or approximately 32 percent on a constant currency basis. Net revenue declined 37.7 percent in the Americas, 36.9 percent in Europe (approximately 31 percent on a constant currency basis), and 20.7 percent in the Asia Pacific region (approximately 19 percent on a constant currency basis). Executive Search represented 92.8 percent of net revenue and Leadership Consulting Services represented 7.2 percent in the 2009 third quarter.

Operating income was $6.7 million and operating margin (measured as a percentage of net revenue) was 6.5 percent, compared to 2008 third quarter operating income of $20.9 million and operating margin of 13.2 percent.

The number of executive search confirmations in the quarter decreased 17 percent compared to the 2008 third quarter, but increased 17 percent compared to the 2009 second quarter. The number of consultants at September 30, 2009 was 365, compared to 416 at September 30, 2008, and 380 at June 30, 2009. Productivity, as measured by annualized net revenue per consultant, was $1.1 million compared to $1.5 million in the 2008 third quarter. The average revenue per executive search was $97,300 compared to $127,200 in last year’s third quarter.

Commenting on the third quarter results, Chief Executive Officer L. Kevin Kelly said, “Although year-over-year comparisons still reflect the impact of a worldwide economic downturn, there are increasing signs that we’ve seen the bottom of this historic recession. Net revenue increased for the second quarter in a row, confirmations increased 17 percent compared to the second quarter, and backlog increased for the first time in the past six quarters. All three regions realized sequential revenue growth compared to the second quarter, and all achieved higher operating income and operating margins compared to second quarter. We can now look forward to capitalizing on the strategic actions and cost savings initiatives we’ve made over the last year.”

Consolidated salaries and employee benefits declined 37.2 percent to $68.2 million, from $108.6 million in the comparable quarter of 2008. This decrease mostly reflects a reduction in bonus expense associated with the decline in revenue, and a decline in base salaries and payroll expense resulting from the company’s workforce reductions in January and May 2009. Salaries and employee benefits were 65.9 percent of net revenue for the quarter, compared to 68.6 percent in the 2008 third quarter.

Consolidated general and administrative expenses were $28.6 million, compared to $28.8 million in the 2008 third quarter. As a percentage of net revenue, consolidated general and administrative expenses were 27.6 percent, compared to 18.2 percent in the 2008 third quarter. In addition to the year-over-year decline in net revenue, this increase reflects higher fees paid for professional services, primarily related to an operations process improvement project, offset by continued cost savings initiatives.

Net income was $4.4 million and diluted earnings per share were $0.25, based upon an effective tax rate in the quarter of 39.2 percent. These results compare to net income in the 2008 third quarter of $14.0 million and diluted earnings per share of $0.80, which reflected an effective tax rate in the quarter of 38.0 percent.

Net cash generated by operating activities was $12.1 million in the 2009 third quarter, compared to net cash generated of $61.1 million in the 2008 third quarter. Cash and cash equivalents at September 30, 2009 were $75.3 million, compared to $183.0 million at September 30, 2008 and $64.6 million at June 30, 2009.

 Regional Review

   $ in millions   3Q 09    3Q 08   Change    3Q 09    2Q 09   Change
                  -------------------------  -------------------------
 Americas
 --------
   Net revenue    $ 50.9   $ 81.8   $(30.9)  $ 50.9   $ 48.3   $  2.6

   Operating
    income        $  8.6   $ 14.0   $ (5.4)  $  8.6   $  5.1   $  3.5
   Consultants       172      211      (39)     172      178       (6)

 Europe
 ------
   Net revenue    $ 31.5   $ 49.9   $(18.4)  $ 31.5   $ 27.5   $  4.0
   Operating
    income        $  2.1   $  7.9   $ (5.8)  $  2.1   $  1.4   $  0.7
   Consultants       115      129      (14)     115      122       (7)

 Asia Pacific
 ------------
   Net revenue    $ 21.1   $ 26.6   $ (5.5)  $ 21.1   $ 17.3   $  3.8
   Operating
    income        $  4.3   $  5.4   $ (1.1)  $  4.3   $  2.2   $  2.1
   Consultants        78       76        2       78       80       (2)

 Corporate        $ (8.3)  $ (6.5)  $ (1.8)  $ (8.3)  $ (8.2)  $ (0.1)
 Restructuring &
  impairment
  charges         $   --   $   --   $   --   $   --   $(12.1)  $ 12.1
                  -------------------------  -------------------------
   Operating
    income (loss) $  6.7   $ 20.9   $(14.1)  $  6.7   $(11.6)  $ 18.3
                  -------------------------  -------------------------

In the 2009 third quarter, all regions reported year-over-year declines in net revenue and operating income. All of the industry practice groups in each region experienced declines. Compared to the 2009 second quarter, the Americas region achieved an increase in net revenue driven by double digit increases in the Consumer, Financial Services, and Life Sciences practices. The sequential increase in Europe’s net revenue was driven by improvements in the Consumer, Financial Services, and Industrial practices, as well as Leadership Consulting Services. Asia Pacific saw good sequential improvement in net revenue from the Financial Services, Industrial and Technology practices, and from Leadership Consulting Services. All three regions achieved higher operating income and operating margins compared to the 2009 second quarter.

Nine Months Results

For the nine months ended September 30, 2009, consolidated net revenue of $285.8 million declined 40.6 percent from $481.0 million in the first nine months of 2008, or approximately 36 percent on a constant currency basis. The number of executive searches confirmed in the first nine months of 2009 declined 31 percent compared to the first nine months of 2008. The reported operating loss of $37.2 million compares to operating income of $50.4 million for the first nine months of 2008. The reported net loss for the first nine months of 2009 was $30.3 million and the net loss per share was $1.80, reflecting an effective tax benefit rate of 24.8 percent. Net income for the first nine months of 2008 was $33.8 million and diluted earnings per share were $1.89, which reflected an effective tax rate of 38.5 percent. Excluding restructuring and impairment charges of $25.4 million, which management believes more appropriately reflects core operations, the operating loss for the first nine months of 2009 was $11.8 million.

2009 Outlook

The company expects that fourth quarter net revenue will be between $103 million and $108 million, resulting in 2009 net revenue of between $389 million and $394 million. With the changes the company has made to improve its operating cost structure, and excluding restructuring and impairment charges, the company believes that breakeven operating income in 2009 is still achievable at the high end of its revenue guidance. Net income (loss) and earnings per share in 2009 are expected to reflect a full-year effective tax benefit rate between 23 percent and 26 percent but may be impacted by country-level results and by discrete items that require immediate recognition in a particular quarter.

Kelly added, “As difficult as 2009 has been, I am excited by the progress we have made in executing our strategy to become the world’s premier Leadership Advisory Firm, fully integrating our executive search and leadership consulting services. Many of our clients are already benefiting from Heidrick & Struggles’ leadership advisory capabilities. This progress, combined with the significant restructuring of our cost structure, make me very enthusiastic about the firm’s growth potential as the economy recovers. We have already seen the results of our initiatives in the third quarter and expect to see positive trends continue in the fourth quarter of 2009 and into 2010.”

Quarterly Conference Call

Executives of Heidrick & Struggles will host a conference call to review 2009 third quarter results today, October 27, at 9:00 am central time. Participants may access the company’s call and supporting slides through the internet at www.heidrick.com. For those unable to participate on the live call, a webcast and copy of the slides will be archived at www.heidrick.com and available for up to 30 days following the investor call.

About Heidrick & Struggles International, Inc.

Heidrick & Struggles International, Inc. is the world’s premier provider of senior-level executive search and leadership consulting services, including succession planning, executive assessment, talent retention management, executive development, transition consulting for newly appointed executives, and M&A human capital integration consulting. For more than 55 years, we have focused on quality service and built strong leadership teams through our relationships with clients and individuals worldwide. Today, Heidrick & Struggles leadership experts operate from principal business centers in North America, Latin America, Europe and Asia Pacific. For more information about Heidrick & Struggles, please visit www.heidrick.com.

Non-GAAP Financial Measures

This earnings release contains certain non-GAAP financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flow of the company. Pursuant to the requirements of Regulation G, the Corporation has provided a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measure.

The non-GAAP financial measures used within this earnings release are: operating income (loss), net income (loss), and net income (loss) per share (i.e., EPS) to the extent presented as “excluding restructuring and impairment charges.” These measures are presented because management uses this information to monitor and evaluate financial results and trends. Management believes this information is also useful for investors.

Safe Harbor Statement

This press release contains forward-looking statements. The forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry in which we operate and management’s beliefs and assumptions. Forward-looking statements may be identified by the use of words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “projects,” “forecasts,” and similar expressions. Forward-looking statements are not guarantees of future performance and involve certain known and unknown risks, uncertainties and assumptions that are difficult to predict. Actual outcomes and results may differ materially from what is expressed, forecasted or implied in the forward-looking statements. Factors that may affect the outcome of the forward-looking statements include, among other things: our ability to attract and retain qualified executive search consultants; further declines in the global economy and our ability to execute successfully through business cycles; the timing, speed or robustness of any future economic recovery; social or political instability in markets where we operate; the impact of foreign currency exchange rate fluctuations; price competition; the ability to forecast, on a quarterly basis, variable compensation accruals that ultimately are determined based on the achievement of annual results; our ability to realize our tax loss carryforwards; the timing of the establishment or reversal of valuation allowance on deferred tax assets; the mix of profit and loss by country; an impairment of our goodwill and other intangible assets; delays in the development and/or implementation of new technology and systems; and the ability to meet and achieve the expected savings resulting from cost-reduction initiatives and restructuring activities. Our reports filed with the U.S. Securities and Exchange Commission also include information on factors that may affect the outcome of forward-looking statements. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

               Heidrick & Struggles International, Inc.
                Consolidated Statements of Operations
                 (In thousands, except per share data)
                              (Unaudited)

                               Three Months Ended
                                   September 30,
                             ---------------------
                                 2009      2008     $ Change  % Change
                             ---------- ---------- ---------- --------
 Revenue:
   Revenue before
    reimbursements
    (net revenue)            $ 103,523  $ 158,318  $ (54,795)   -34.6%
    Reimbursements               4,747      7,009     (2,262)   -32.3%
                             ---------- ---------- ----------
     Total revenue             108,270    165,327    (57,057)   -34.5%

 Operating expenses:
   Salaries and employee
    benefits                    68,184    108,611    (40,427)   -37.2%
   General and administrative
    expenses                    28,623     28,849       (226)    -0.8%
   Reimbursed expenses           4,747      7,009     (2,262)   -32.3%
                             ---------- ---------- ----------
     Total operating expenses  101,554    144,469    (42,915)   -29.7%
                             ---------- ---------- ----------
     Operating income            6,716     20,858    (14,142)   -67.8%

 Non-operating income:
   Interest income, net             64      1,181
   Other, net                      470        499
                             ---------- ----------
     Net non-operating income      534      1,680

 Income before income taxes      7,250     22,538

 Provision for income taxes      2,842      8,559
                             ----------

 Net income                  $   4,408  $  13,979
                             ========== ==========

 Basic weighted average
  common shares outstanding     17,030     16,455
 Diluted weighted average
  common shares outstanding     17,635     17,395
 Basic earnings per common
  share                      $    0.26  $    0.85
 Diluted earnings per common
  share                      $    0.25  $    0.80
 Salaries and employee
  benefits as a percentage of
  net revenue                     65.9%      68.6%
 General and administrative
  expense as a percentage of
  net revenue                     27.6%      18.2%
 Operating income as a
  percentage of net revenue        6.5%      13.2%
 Effective tax rate               39.2%      38.0%

               Heidrick & Struggles International, Inc.
                         Segment Information
                            (In thousands)

                            Three Months Ended September 30,
              --------------------------------------------------------
                                                       2009     2008
                 2009     2008    $ Change  % Change Margin * Margin *
              --------- --------- --------- -------- -------- --------
 Revenue:
  Americas    $  50,949 $  81,844 $ (30,895)  -37.7%
  Europe         31,513    49,906   (18,393)  -36.9%
  Asia Pacific   21,061    26,568    (5,507)  -20.7%
              --------- --------- ---------
   Revenue
    before
    reimburse-
    ments (net
    revenue)    103,523   158,318   (54,795)  -34.6%
  Reimburse-
   ments          4,747     7,009    (2,262)  -32.3%
              --------- --------- ---------
   Total
    revenue   $ 108,270 $ 165,327 $ (57,057)  -34.5%
              ========= ========= =========

 Operating
  income:
  Americas    $   8,578 $  13,989 $  (5,411)  -38.7%    16.8%    17.1%
  Europe          2,093     7,931    (5,838)  -73.6%     6.6%    15.9%
  Asia Pacific    4,303     5,443    (1,140)  -20.9%    20.4%    20.5%
              --------- --------- ---------
   Total
    regions      14,974    27,363   (12,389)  -45.3%    14.5%    17.3%
  Corporate      (8,258)   (6,505)   (1,753)  -26.9%
              --------- --------- ---------
   Operating
    income    $   6,716 $  20,858 $ (14,142)  -67.8%     6.5%    13.2%
              ========= ========= =========

   * Margin based on revenue before reimbursements (net revenue).

               Heidrick & Struggles International, Inc.
                 Consolidated Statements of Operations
                 (In thousands, except per share data)
                              (Unaudited)

                                Nine Months Ended
                                  September 30,
                             ---------------------
                                2009       2008     $ Change  % Change
                             ---------- ---------- ---------- --------
 Revenue:
   Revenue before
    reimbursements (net
    revenue)                 $ 285,779  $ 480,975  $(195,196)   -40.6%
   Reimbursements               13,812     22,108     (8,296)   -37.5%
                             ---------- ---------- ----------
     Total revenue             299,591    503,083   (203,492)   -40.4%

 Operating expenses:
   Salaries and employee
    benefits                   212,110    336,535   (124,425)   -37.0%
   General and administrative
    expenses                    85,447     94,039     (8,592)    -9.1%
   Reimbursed expenses          13,812     22,108     (8,296)   -37.5%
   Restructuring and
    impairment charges          25,439         --     25,439
                             ---------- ---------- ----------
     Total operating expenses  336,808    452,682   (115,874)   -25.6%
                             ---------- ---------- ----------
     Operating income (loss)   (37,217)    50,401    (87,618)  -173.8%

 Non-operating income
  (expense):
  Interest income, net             912      4,127
  Other, net                    (3,974)       394
                             ---------- ----------
     Net non-operating income
      (expense)                 (3,062)     4,521

 Income (loss) before income
  taxes                        (40,279)    54,922

 Provision for (benefit from)
  income taxes                  (9,993)    21,131
                             ---------- ----------

 Net income (loss)           $ (30,286) $  33,791
                             ========== ==========

 Basic weighted average
  common shares outstanding     16,845     16,877
 Diluted weighted average
  common shares outstanding     16,845     17,841
 Basic earnings (loss) per
  common share               $   (1.80) $    2.00
 Diluted earnings (loss) per
  common share               $   (1.80) $    1.89
 Salaries and employee
  benefits as a percentage of
  net revenue                     74.2%      70.0%
 General and administrative
  expense as a percentage of
  net revenue                     29.9%      19.6%
 Operating income (loss) as a
  percentage of net revenue         n/a      10.5%
 Effective tax rate               24.8%      38.5%

               Heidrick & Struggles International, Inc.
                         Segment Information
                            (In thousands)

                              Nine Months Ended September 30,
              --------------------------------------------------------
                                                       2009      2008
                 2009     2008    $ Change  % Change Margin * Margin *
              --------- --------- --------- -------- -------- --------
 Revenue:
  Americas    $ 145,669 $ 246,183 $(100,514)  -40.8%
  Europe         87,075   156,116   (69,041)  -44.2%
  Asia Pacific   53,035    78,676   (25,641)  -32.6%
              --------- --------- ---------
   Revenue
    before
    reimburse-
    ments (net
    revenue)    285,779   480,975  (195,196)  -40.6%
  Reimburse-
   ments         13,812    22,108    (8,296)  -37.5%
              --------- --------- ---------
   Total
    revenue   $ 299,591 $ 503,083 $(203,492)  -40.4%
              ========= ========= =========

 Operating
  income
  (loss):
  Americas    $   6,211 $  38,271 $ (32,060)  -83.8%     4.3%    15.5%
  Europe            885    20,872   (19,987)  -95.8%     1.0%    13.4%
  Asia Pacific    5,453    14,784    (9,331)  -63.1%    10.3%    18.8%
              --------- --------- ---------
   Total
    regions      12,549    73,927   (61,378)  -83.0%     4.4%    15.4%
  Corporate     (24,327)  (23,526)     (801)   -3.4%
              --------- --------- ---------
   Operating
    income
    (loss)
    before
    restructu-
    ring and
    impairment
    charges     (11,778)   50,401   (62,179) -123.4%             10.5%
 Restructuring
  and
  impairment
  charges       (25,439)       --   (25,439)
              --------- --------- ---------
   Operating
    income
    (loss)    $ (37,217)$  50,401 $ (87,618) -173.8%             10.5%
              ========= ========= =========

   * Margin based on revenue before reimbursements (net revenue).

               Heidrick & Struggles International, Inc.
                 Condensed Consolidated Balance Sheets
                            (In thousands)

                                           September 30,  December 31,
                                               2009          2008
                                           ------------- -------------
                                            (Unaudited)
 Current assets:
   Cash and cash equivalents               $     75,294  $    234,531
   Restricted cash                                6,043            --
   Accounts receivable, net                      76,736        68,233
   Other receivables                              7,409         8,586
   Prepaid expenses                              21,838        19,520
   Other current assets                           1,981         1,788
   Income taxes recoverable, net                 16,360         7,719
   Deferred income taxes, net                    13,474        13,893
                                           ------------- -------------
       Total current assets                     219,135       354,270
                                           ------------- -------------

 Non-current assets:
   Property and equipment, net                   25,917        28,172
   Restricted cash                                4,171         9,655
   Assets designated for retirement and
    pension plans                                26,150        24,973
   Investmentsng income (loss)                   10,275        12,594
   Other non-current assets                       5,621         7,203
   Goodwill                                     109,182       101,234
   Other intangible assets, net                   9,251        13,543
   Deferred income taxes, net                    36,073        35,313
                                           ------------- -------------
       Total non-current assets                 226,640       232,687
                                           ------------- -------------

 Total assets                              $    445,775  $    586,957
                                           ------------- -------------

 Current liabilities:
   Accounts payable                        $      6,410  $     11,977
   Accrued salaries and employee benefits        62,355       163,695
   Other current liabilities                     35,986        49,443
   Current portion of accrued restructuring
    charges                                       3,491         2,280
                                           ------------- -------------
       Total current liabilities                108,242       227,395
                                           ------------- -------------

 Non-current liabilities:
   Retirement and pension plans                  30,113        27,503
   Other non-current liabilities                 26,352        25,755
                                           ------------- -------------
       Total non-current liabilities             56,465        53,258
                                           ------------- -------------

 Stockholders' equity                           281,068       306,304
                                           ------------- -------------

 Total liabilities and stockholders'
  equity                                   $    445,775  $    586,957
                                           ------------- -------------

               Heidrick & Struggles International, Inc.
                Consolidated Statements of Cash Flows
                            (In thousands)

                                                Three Months Ended
                                                  September 30,
                                           ---------------------------
                                               2009           2008
                                           ------------- -------------
                                            (Unaudited)

 Cash flows from operating activities:
   Net income                              $      4,408  $     13,979
   Adjustments to reconcile net income to
    net cash provided by operating
    activities:
     Depreciation and amortization                2,777         2,708
     Write-off of software development
      project                                     1,329            --
     Deferred income taxes                       (2,495)          491
     Net realized and unrealized (gains)
      losses on investments                         939          (525)
     Stock-based compensation expense, net        4,357         6,198
     Cash paid for restructuring charges         (6,462)         (716)
     Changes in assets and liabilities, net
      of effects of acquisitions:
       Trade and other receivables              (11,929)        4,649
       Accounts payable                             690          (674)
       Accrued expenses                          10,263        33,826
       Income taxes payable, net                  5,111         3,039
       Prepayments                                  396          (122)
       Other assets and liabilities, net          2,756        (1,712)
                                           ------------- -------------
         Net cash provided by operating
          activities                             12,140        61,141
                                           ------------- -------------

 Cash flows from investing activities:
   Restricted cash                                 (642)           --
   Acquisition of businesses, net of cash
    acquired                                         --        (3,610)
   Capital expenditures                            (590)       (2,760)
   Proceeds from sales of equity securities          --           353
   Payments to consultants related to sales
    of equity securities                             (3)          (60)
   Other, net                                         5            --
                                           ------------- -------------
         Net cash used in investing
          activities                             (1,230)       (6,077)
                                           ------------- -------------

 Cash flows from financing activities:
   Proceeds from stock options exercised             --           251
   Purchases of treasury stock                       --        (5,051)
   Cash dividends paid                           (2,231)       (2,142)
   Payment of employee tax withholdings on
    equity transactions                             (52)         (233)
                                           ------------- -------------
         Net cash used in financing
          activities                             (2,283)       (7,175)
                                           ------------- -------------

 Effect of exchange rate fluctuations on
  cash  and cash equivalents                      2,039       (10,940)
                                           ------------- -------------

 Net increase in cash and cash equivalents       10,666        36,949
 Cash and cash equivalents at beginning of
  period                                         64,628       146,074
                                           ------------- -------------
 Cash and cash equivalents at end of
  period                                   $     75,294  $    183,023
                                           ============= =============

 Supplemental schedule of noncash financing
  activities:
   Beginning of period - Accrued treasury
    stock purchases                        $         --  $        706
   Treasury stock purchases                          --         5,378
   Cash paid for treasury stock purchases            --        (5,051)
                                           ------------- -------------
       Accrued treasury stock purchases    $         --  $      1,033
                                           ============= =============

               Heidrick & Struggles International, Inc.
                 Consolidated Statements of Cash Flows
                            (In thousands)

                                                Nine Months Ended
                                                   September 30,
                                           ---------------------------
                                                2009         2008
                                           ------------- -------------
                                            (Unaudited)

 Cash flows from operating activities:
   Net income (loss)                       $    (30,286) $     33,791
    Adjustments to reconcile net income
     (loss) to net cash used in operating
     activities:
      Depreciation and amortization               8,360         8,068
      Write-off of investment                     2,977            --
      Write-off of software development
       project                                    1,329            --
      Deferred income taxes                      (6,214)        5,466
      Net realized and unrealized (gains)
       losses on investments                      1,831          (910)
      Stock-based compensation expense, net      15,027        18,767
      Impairment charge                           3,849            --
      Restructuring charges                      21,590            --
      Cash paid for restructuring charges       (23,439)       (2,121)
      Changes in assets and liabilities,
       net of effects of acquisitions:
        Trade and other receivables              (4,350)      (29,134)
        Accounts payable                           (152)         (313)
        Accrued expenses                       (101,975)      (34,508)
        Income taxes recoverable, net            (8,568)       (4,054)
        Prepayments                              (1,556)       (6,094)
        Other assets and liabilities, net         1,538        (3,224)
                                           ------------- -------------
          Net cash used in operating
           activities                          (120,039)      (14,266)
                                           ------------- -------------

 Cash flows from investing activities:
   Restricted cash                                 (483)          138
   Acquisition of businesses, net of cash
    acquired                                    (15,453)      (14,655)
   Capital expenditures                         (10,053)       (7,928)
   Purchases of equity method investments        (1,300)           --
   Proceeds from sales of equity securities           6           779
   Payments to consultants related to sales
    of equity securities                             (3)         (229)
   Proceeds from sales of short-term
    investments                                      --        22,275
   Proceeds from sale of a business                  --         1,559
   Other, net                                        15             8
                                           ------------- -------------
          Net cash provided by (used in)
           investing activities                 (27,271)        1,947
                                           ------------- -------------

 Cash flows from financing activities:
   Proceeds from stock options exercised          1,238           831
   Purchases of treasury stock                       --       (47,038)
   Cash dividends paid                           (7,063)       (6,623)
   Payment of employee tax withholdings on
    equity transactions                          (3,117)       (8,356)
                                           ------------- -------------
          Net cash used in financing
           activities                            (8,942)      (61,186)
                                           ------------- -------------

 Effect of exchange rate fluctuations on
  cash  and cash equivalents                     (2,985)       (4,052)
                                           ------------- -------------

 Net decrease in cash and cash equivalents     (159,237)      (77,557)
 Cash and cash equivalents at beginning of
  period                                        234,531       260,580
                                           ------------- -------------
 Cash and cash equivalents at end of
  period                                   $     75,294  $    183,023
                                           ============= =============

 Supplemental schedule of noncash financing
  activities:
   Beginning of period - Accrued treasury
    stock purchases                        $         --  $      1,605
   Treasury stock purchases                          --        46,466
   Cash paid for treasury stock purchases            --       (47,038)
                                           ------------- -------------
          Accrued treasury stock purchases $         --  $      1,033
                                           ============= =============
CONTACT:  Heidrick & Struggles International, Inc.
          Investors & Analysts:
          Julie Creed, VP, Investor Relations
          +1 312 496 1774
          jcreed@heidrick.com
Tuesday, October 27th, 2009 Uncategorized
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