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CTPartners Executive Search Inc. Announces First Quarter 2013 Financial Results

CTPartners Executive Search Inc. Announces First Quarter 2013 Financial Results

Revenue of $29.2 million in line with guidance

Reported net loss per share of $0.29 Adjusted net loss per share of $0.05, consistent with guidance

Second quarter 2013 revenue guidance between $31.5 to $33.5 million

Adjusted earnings per share in the range of $0.01 to $0.06

CTPartners Executive Search Inc. the global retained executive search firm, has announced its financial results for the first quarter ended, March 31, 2013.

“While our first quarter results were consistent with our guidance, we continue to operate in a challenging economic environment for executive recruitment services. We successfully delivered quality results to our growing list of clients and improved our client coverage and enhanced our expertise. We took a significant step in that direction with the recent acquisition of Augmentum, a premier global executive recruitment firm based in London, with an outstanding reputation for producing excellent client results. Augmentum will increase our UK presence and significantly improve our global competitive position while making a positive contribution to our financial results immediately,” said Brian Sullivan, Chief Executive Officer.

FIRST QUARTER RESULTS

Revenue for the first quarter was $29.2 million compared with revenue of $32.4 million in the prior year's first quarter. North American revenue decreased 13.4% to $17.4 million EMEA was essentially flat at $6.7 million and Asia Pacific revenue was $1.7 million compared to $2.6 million in the first quarter of 2012. Latin America partially offset these decreases as revenue increased 13.4% to $3.3 million. On a practice basis, Life Sciences grew 8.6% to $5.7 million and Industrial increased 28% to $3.6 million while Financial Services, Consumer/Retail, Technology Media & Telecom and Professional Services declined 29.8%, 20.1%, 6% and 3.2%, respectively, due to softer market conditions.

Excluding post-combination compensation expense mainly related to the Latin America acquisition in 2012, the Company decreased its compensation expense by $2.8 million to $22.2 million. Excluding non-operating expenses, this decrease in compensation expense was offset by a $0.7 million increase in general and administrative expenses to $7.4 million, primarily as a result of a global branding initiative and business development costs.

The net loss for the first quarter was $2.0 million, or $0.29 per share, compared to a net loss of $0.6 million, or $0.08 per share for last year's first quarter. Excluding non-operating charges of $1.7 million net of tax for the three months ended March 31, 2013, and $1.0 million for the three months ended March 31, 2012, the adjusted net loss was $0.4 million, or $0.05 per share compared to adjusted net income of $0.4 million, or $0.06 per share in last year's first quarter, as defined in the reconciliation of non-GAAP measures included in the press release.

The cash balance at March 31, 2013 was $6.5 million compared to $7.2 million for the quarter ended March 31, 2012 and $15.9 million at year end 2012.

PERFORMANCE METRICS    

•              The Company was engaged in 348 new search assignments compared to 385 in the year-ago quarter, and up sequentially from 299 in the 2012 fourth quarter.      

•              The number of placements was 231, a 78% placement rate compared to 234, or a 75% placement rate in last year's comparable quarter and 270 placements, or an 82% placement rate in the 2012 fourth quarter.           

•              CTPartners had 107 consultants compared with 113 consultants in the year-ago quarter and up sequentially from 103 consultants, reflecting the Company's goal of continually replacing non-performers with high-caliber consultants.             

•              Net revenue per consultant was $1.1 million, flat with last year's first quarter and down slightly from $1.2 million in the 2012 fourth quarter.     

•              Average revenue per search increased to $90,300 compared to $89,100 in last year's first quarter and was slightly down from $91,400 in the 2012 fourth quarter.               

•              The number of clients representing repeat business was 72% in the quarter compared with 76% in both last year's first quarter and 2012 fourth quarter.

Guidance

CTPartners growth strategy is to continue to deliver more searches to existing clients, add new clients, and diligently add new consultants through strategic acquisitions. The company also is focused on reducing costs as appropriate to meet its objective of expanding its operating margin in 2013. For the second quarter ending June 30, 2013, the Company expects to report revenue in the range of $31.5 to $33.5 million and adjusted earnings per share between $0.01 to $0.06, excluding the non-operating charges.

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