Heidrick & Struggles International Inc. reported Tuesday, April 28, that first-quarter net revenue fell 41.8 percent year-over-year to $89.1 million as the number of executive searches confirmed fell 38.4 percent. The executive search firm also announced a $13.4 million restructuring charge for the quarter, and plans more staff cuts in the second quarter.
“The negative impact of the global financial crisis and recession is no longer contained to one or two industries,” CEO L. Kevin Kelly said. “Each of our practice groups and every region experienced double-digit revenue declines in the first quarter.”
Heidrick’s largest region, the Americas, posted a 40 percent year-over-year decline in first-quarter net revenue to $46.4 million. Europe fell 46.9 percent to $28.1 million, and Asia Pacific revenue fell 36 percent to $14.7 million. Heidrick reports net revenue as revenue before reimbursements.
Heidrick reported a first-quarter net loss of $18.9 million, compared with net income of $7.1 million in the year-ago quarter. Net loss would have been $11.2 million excluding the $13.4 million restructuring charge.
The company said it plans to cut headcount by 8 to 10 percent in May, after its 11 percent reduction in January. In addition, Heidrick plans to reduce base salaries by 5 percent, where possible, through salary cuts, unpaid days off and reduced hours. It expects a second-quarter restructuring charge of $6 million to $10 million.
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