CTPartners Executive Search Inc. Announces First Quarter 2011 Financial Results

NEW YORK, May 11, 2011 /PRNewswire/ -- CTPartners Executive Search Inc. (AMEX: CTP), a leading global retained executive search firm, today announced results for the quarter ended March 31, 2011.  

First Quarter 2011 Results

For the quarter ended March 31, 2011, net revenue of $30.5 million increased 18.3% from $25.8 million in the corresponding period in 2010.  The net revenue growth was the result of an increase in the number of search assignments and the number of executive search consultants employed.

Revenue breakdown by region:

Revenue breakdown by industry vertical:

There were 300 confirmed searches in the first quarter of 2011, a 17.2% increase compared to the first quarter of 2010.  Productivity, defined as average annualized net revenue per executive search consultant, was in line with the prior year.  The average fee per search was $89,540 in the first quarter of 2011 compared to $104,020 in the corresponding period in 2010.

Performance metrics:

Compensation and employee benefits expense increased $5.7 million, or 32.5%, to $23.3 million for the first quarter ended March 31, 2011 from $17.6 million for the quarter ended March 31, 2010. As a percentage of net revenue, first quarter 2011 compensation and benefits increased to 76.6% compared to 68.4% for the same period in 2010.  The increase in compensation and benefits expense was primarily the result of a $2.2 million increase in salaries related to the hiring of 18 new consultants and 62 new support staff since the first quarter of last year, a $1.3 million increase in incentive compensation for executive search consultants which was the direct result of higher consolidated net revenue and a $0.6 million increase in sign-on incentives related to the hiring of new consultants.  

General and administrative expenses increased approximately $1.0 million, or 18.2%, to $6.1 million for the quarter ended March 31, 2011 from $5.1 million for the same period in 2010. The increase was partially due to a $350,000 increase in business development expense which is a direct result of an increase in the number of consultants, a $250,000 increase in professional fees which included accounting, audit and tax preparation services and an $180,000 increase in travel expenses related to growth opportunities and aggressive recruiting efforts.  General and administrative expenses as a percentage of net revenue remained at 19.9% for the quarters ended March 31, 2011 and March 31, 2010, respectively.  

Operating income decreased $2.0 million to $1.0 million for the quarter ended March 31, 2011, compared to operating income of $3.0 million for the same period in 2010. The decrease primarily reflects an increase in net revenues of $4.7 million offset by a $5.7 million increase in compensation and benefits expense, and a $1.0 million increase in general and administrative expenses.

For the three-month period ended March 31, 2011, income before taxes was $0.9 million and the recorded income tax expense was $0.3 million, as compared to income before taxes of $3.0 million and income tax expense of $0.1 million for the three-month period ended March 31, 2010. The increase in income tax expense was primarily due to a $0.6 million increase in the current tax provision offset by a $0.4 million deferred tax benefit.

Net income for the quarter ended March 31, 2011 was $0.6 million.

Conference Call and Webcast

The company will host a conference call today at 9:00 AM (Eastern) / 6:00 AM (Pacific) to discuss these financial results.  A live dial-in is available domestically at 866.783.2141 and internationally at 857.350.1600, passcode 12557998.  A replay will be available, until midnight (Eastern) June 1, 2011 domestically at 888.286.8010 and internationally at 617.801.6888 passcode 92383463.  A web broadcast of the event will be available live and for replay purposes on the CTPartners Investor Relations website at http://investor.ctnet.com.  

CTPartners' 10-Q report is available online at  http://investor.ctnet.com and www.sec.gov.

About CTPartners

CTPartners is a leading performance-driven executive search firm serving clients across the globe. Committed to a philosophy of partnering with its clients, CTPartners offers a proven record in C-Suite, top executive, and board searches, as well as expertise serving private equity and venture capital firms.

With origins dating back to 1980, CTPartners serves clients with a global organization of more than 350 professionals and employees, offering expertise in board advisory services and executive recruiting services in the financial services, life sciences, industrial, professional services, retail and consumer, and technology, media and telecom industries.

CTPartners' focus is straightforward: Place the right executive in the chair. Evidence of CTPartners' ability to get the job done is its 83% placement success rate and average days to placement of 123 days in 2010.  For the eighteen month period ending on June 30, 2010 (the most recent period for which our placement results have been examined by our outside accounting firm) we had a stick rate of 90%.

Methodologies used include our proprietary technology, ClientNet®, a technology tool that permits our clients to access password-protected information over the internet from any place, at any time, to check the status of their search engagements and the 40-day Audit processes.

Headquartered in New York, CTPartners has offices in Bogotá, Boston, Caracas, Chicago, Cleveland, Columbia MD, Dallas, Dubai, Geneva, Hong Kong, Lima, London, Mexico City, Miami, Paris, Redwood Shores, Santiago, São Paulo, Shanghai, Singapore, Toronto, and Washington, D.C.

Safe Harbor Statement

The following is a Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:

This press release includes forward-looking statements.  As a general matter, forward-looking statements reflect our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business.  These statements may be identified by the use of forward looking terminology such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of those words or other comparable words, but the absence of these words does not necessarily mean that a statement is not forward-looking.  The Private Securities Litigation Reform Act of 1995 provides a safe harbor for the disclosure of forward-looking statements.

The forward-looking statements contained in this press release are based upon our historical performance, current plans, estimates, expectations and other factors we believe are appropriate under the circumstances. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates or expectations contemplated by us will be achieved since these forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from those indicated in these statements. Some of the key uncertainties and factors that could affect our future performance and cause actual results to differ materially from those expressed or implied by forward-looking statements are: our expectations regarding our revenues, expenses and operations and our ability to sustain profitability; our ability to recruit and retain qualified executive search consultants to staff our operations appropriately; our ability to expand our customer base and relationships, especially given the off-limit arrangements we are required to enter into with certain of our clients; further declines in the global economy and our ability to execute successfully through business cycles; our anticipated cash needs; our anticipated growth strategies and sources of new revenues; unanticipated trends and challenges in our business and the markets in which we operate; 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; and the mix of profit and loss by country in which we operate.

SOURCE CTPartners Executive Search Inc.