Korn Ferry · NYSE:KFY

Korn Ferry — Q2 FY2021 Earnings Presentation

21 slides from Korn Ferry's earnings presentation, Nov 23, 2020

  1. Slide 1: FY'21 Q2 Earnings Call Presentation

    KORN FERRY FY’21 Q2 Earnings Call Presentation November 23, 2020

  2. Slide 2: Safe Harbor Statement

    SAFE HARBOR STATEMENT FORWARD-LOOKING STATEMENTS NON-GAAP FINANCIAL MEASURES Statements in this presentation that relate to This presentation includes financial information future results and events are based on Korn calculated other than in accordance with U.S. Ferry’s current expectations. You are

  3. Slide 3: FY'21 Q2 Financial Results Significantly Improved Sequentially

    FY’21 Q2 FINANCIAL RESULTS SIGNIFICANTLY IMPROVED SEQUENTIALLY Adj. EBITDA(2) Adj. EBITDA Margin % (2) Adj. Diluted EPS ($) (4) Fee Revenue (NON-GAAP) (NON-GAAP) (NON-GAAP) $435M $66M 15.2% $0.54 +$91M +$56M +$0.73 +27% See detailed explanation of footnotes on page 13 © 2020 Korn Ferry. All rights r

  4. Slide 4: Business Continues to Be Highly Diversified Across Segment, Geography and Industry

    BUSINESS CONTINUES TO BE HIGHLY DIVERSIFIED ACROSS SEGMENT, GEOGRAPHY AND INDUSTRY FEE REVENUE BY SEGMENT FEE REVENUE BY GEOGRAPHY FEE REVENUE BY INDUSTRY Edu, / LATM Non- RPO & 3% Consumer Profit Prof. 14% APAC Tech. 6% Search 20% 18% 15% Executive Search 34% Fin. Svcs NAM 19% Digital 50% Life Sci.

  5. Slide 5: Diversified Mix of Revenue & Operating Efficiencies Driving Improved Earnings

    DIVERSIFIED MIX OF REVENUE & OPERATING EFFICIENCIES ARE DRIVING SIGNIFICANTLY IMPROVED & BALANCED EARNINGS ($M) (7) FY’20 QTR. 2 FY’21 QTR. 1 FY’21 QTR. 2 (5) (5) (5) $492 $97 $344 $29 $435 $85 100% 100% 100% $66 90% $56 $75 90% $22 90% $8 $23 80% 80% 80% $95 $69 $86 70% 70% 70% $16 $14 60% $6 60% 6

  6. Slide 6: Quarterly New Business Growth YoY (Excluding RPO)

    QUARTERLY NEW BUSINESS* GROWTH YOY (EXCLUDING RPO) FY’20 QTR. 4 to FY’21 QTR. 2 (7%) 61% (19%) (20%) 35% 68% 32% Qtr. 4 Qtr. 1 Qtr. 2 FY'20 FY'21 FY'21 *Confirmations Plus Upticks and Additional Placements © 2020 Korn Ferry. All rights reserved 6

  7. Slide 7: Quarterly New Business Growth YoY by Segment (Excluding RPO)

    QUATERLY NEW BUSINESS* GROWTH YOY BY SEGMENT (EXCLUDING RPO) FY’20 QTR. 4 to FYY’21 QTR. 2 KF Total * Executive Search* (7%) (16%) (21%) (19%) (20%) (34%) Qtr. 4 Qtr. 1 Qtr. 2 Qtr. 4 Qtr. 1 Qtr. 2 FY'20 FY'21 FY'21 FY'20 FY'21 FY'21 Digital & Consulting Professional Search* 17% Digital 10% 35% (21%)

  8. Slide 8: Consulting

    CONSULTING 29% OF FEE REVENUE AND 24% OF EARNINGS IN FY’21 QTR. 2 NEW BUSINESS UP 17% SEQUENTIALLY IN QTR. 2 (2) FEE REVENUE ($M) ADJ. EBITDA ($M) & ADJ. EBITDA CONSULTANT + EXECUTION MARGIN (%) (NON-GAAP) STAFF PRODUCTIVITY Hours Worked 15.9% 463K 399K $144 Avg. Bill Rate 367K $318 10.1% $311 $127

  9. Slide 9: Digital

    DIGITAL 17% OF FEE REVENUE AND 27% OF EARNINGS IN FY’21 QTR. 2 NEW BUSINESS UP 31% SEQUENTIALLY IN QTR. 2 (1) ADJ. EBITDA ($M) & ADJ. EBITDA SUBSCRIPTION & LICENSE FEE FEE REVENUE ($M) MARGIN (%) (NON-GAAP) REVENUE(6) - ($M) 34.1% 30.8% $75 $23 $21 $66 $22.4 $23.1 $56 14.2% $16 $7.9 FY'20 Q2 FY'21 Q

  10. Slide 10: Executive Search

    EXECUTIVE SEARCH 34% OF FEE REVENUE AND 33% OF EARNINGS IN FY’21 QTR. 2 NEW BUSINESS UP 25% SEQUENTIALLY IN QTR. 2 (2) FEE REVENUE ($M) ADJ. EBITDA ($M) & ADJ. EBITDA CONSULTANT PRODUCTIVITY MARGIN (%) (NON-GAAP) 23.4% $1.30 $1.16 $188 $8 19.1% $44.0 $0.90 $26 585 $148 $4 510 512 $40 $120 $21 $3 $28

  11. Slide 11: RPO & Professional Search

    RPO & PROFESSIONAL SEARCH 20% OF FEE REVENUE AND 16% OF EARNINGS IN FY’21 QTR. 2 (2) FEE REVENUE ($M) ADJ. EBITDA ($M) & ADJ. EBITDA NEW BUSINESS ($M) MARGIN (%) (NON-GAAP) 17.0% $155 16.1% $150 $95 $37 $30 $86 $16.1 $13.8 $37 $69 $29 $83 8.8% $24 $27 $118 $120 $6.0 $58 $57 $45 $56 FY'20 Q2 FY'21 Q1

  12. Slide 12: Cash & Marketable Securities: Strong Liquidity with $458M of Investable Cash

    CASH & MARKETABLE SECURITIES (8) STRONG LIQUIDITY WITH $458M OF INVESTABLE CASH Cash & Marketable Securities ($M) $733 $747 $609 $222 $289 $263 $511 $458 $346 FY'20 Q2 FY'21 Q1 FY'21 Q2 Bonuses & Deferred Compensation (8) Investable Cash (8) § Investable Cash – up $112M or 32% YoY ‒ FY’20 Q2 Investa

  13. Slide 13: Footnotes

    FOOTNOTES (1) Earnings Before Interest, Taxes, Depreciation & Amortization Adjusted to Exclude Acquisition/Integration Costs and Restructuring Charges. (2) Earnings Before Interest, Taxes, Depreciation & Amortization Adjusted to Exclude Restructuring Charges. (3) Earnings Before Interest, Taxes, Dep

  14. Slide 14: Appendix: Reconciliations of Non-GAAP Financial Measures to U.S. GAAP

    APPENDIX: Reconciliations of Non-GAAP Financial Measures to U.S. GAAP Financial Measures Earnings Conference Call November 23, 2020

  15. Slide 15: Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)

    KORN FERRY Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP) ($M) FY’20 Q2; FY’21 Q1; FY’21 Q2 YoY Sequential FY'20 FY'21 FY'21 Incr. / (Decr.) Incr. / (Decr.) Qtr. 2 Qtr. 1 Qtr. 2 $/% % $/% % Net (Loss) Income Attributable to Korn / Ferry $42.8 ($30.8) $27.8 ($15.0) (35.1% ) $58.6 1

  16. Slide 16: Reconciliation of Net Income & EPS to Adjusted Net Income & Adjusted EPS

    KORN FERRY Reconciliation of Net Income & EPS (GAAP) to Adjusted Net Income & Adjusted EPS (Non-GAAP) ($M) FY’20 Q2; FY’21 Q1; FY’21 Q2 YoY Sequential FY'20 FY'21 FY'21 Incr. / (Decr.) Incr. / (Decr.) Qtr. 2 Qtr. 1 Qtr. 2 $ % $ % Net (Loss) Income Attributable to Korn / Ferry $42.8 ($30.8) $27.8 ($1

  17. Slide 17: Reconciliation to EBITDA & Adjusted EBITDA FY'20 Q2; FY'21 Q1

    KORN FERRY Reconciliation of Net Income & Operating Income (GAAP) to EBITDA & Adjusted EBITDA (Non-GAAP) ($M) FY’20 Q2; FY’21 Q1 FY'20 Q2 FY'21 Q1 Exec. RPO & Exec. RPO & Consulting Digital Search Prof. Search Corp. KF Consulting Digital Search Prof. Search Corp. KF Fee Revenue $144.0 $65.7 $187.9 $

  18. Slide 18: Reconciliation to EBITDA & Adjusted EBITDA FY'21 Q2

    KORN FERRY Reconciliation of Net Income & Operating Income (GAAP) to EBITDA & Adjusted EBITDA (Non-GAAP) ($M) FY’21 Q2 FY'21 Q2 Exec. RPO & Consulting Digital Search Prof. Search Corp. KF Fee Revenue $126.7 $75.0 $148.1 $85.7 - $435.4 Total Revenue 127.1 75.0 148.6 87.1 437.8 Net Income Attributable

  19. Slide 19: Reconciliation of Cash & Marketable Securities to Investable Cash

    KORN FERRY Reconciliation of Cash & Marketable Securities to Investable Cash ($M) FY’20 Q2; FY’21 Q1; FY’21 Q2 FY'20 FY'21 FY'21 Qtr. 1 Qtr. 1 Qtr. 2 Cash $424.6 $542.8 $553.1 Marketable Securities 142.7 190.2 194.3 Cash & Marketable Securities $567.3 $733.0 $747.5 ECAP & Bonus Liability (204.7) (22

  20. Slide 20: Fee Revenue Growth by Segment and Region – Reported vs. Constant Currency

    KORN FERRY Fee Revenue Growth by Segment and Region – Actual Reported vs. Constant Currency FY'21 Q2 vs. FY'20 Q2 Reported Const. Curr. $M % Grth. % Grth. Executive Search North America $91.2 (19.9%) (18.2%) Europe 31.6 (20.6%) (31.7%) Asia / Pacific 20.8 (19.8%) (22.1%) Latin America 4.5 (46.1%) (2

  21. Slide 21: Thank you

    Thank you «4 KORN FERRY’

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