Robert Half Reports Second-Quarter Financial Results

MENLO PARK, Calif., July 23, 2020 /CNW/ -- 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 ([phone] 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 ([phone] 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

SOURCE Robert Half

M. Keith Waddell, President and Chief Executive Officer, [phone], http://www.roberthalf.com

Related Links

http://www.roberthalf.com