ROBERT HALF REPORTS FOURTH-QUARTER FINANCIAL RESULTS

·13 min read

MENLO PARK, Calif., Jan. 27, 2022 /CNW/ -- Robert Half International Inc. (NYSE: RHI) today reported revenues and earnings for the fourth quarter ended December 31, 2021.

Robert Half (PRNewsfoto/Robert Half)
Robert Half (PRNewsfoto/Robert Half)

For the quarter ended December 31, 2021, net income was $168 million, or $1.51 per share, on revenues of $1.770 billion. Net income for the prior year's fourth quarter was $94 million, or $.84 per share, on revenues of $1.304 billion.

For the year ended December 31, 2021, net income was $599 million, or $5.36 per share, on revenues of $6.461 billion. For the year ended December 31, 2020, net income was $306 million, or $2.70 per share, on revenues of $5.109 billion.

"2021 was an extraordinary year, and we achieved record annual results. Fourth quarter revenues grew 36% and net income grew 78%, exceeding the high end of our guidance and reflecting sustained, broad-based demand across our staffing and business consulting businesses," said M. Keith Waddell, president and chief executive officer of Robert Half. "Our permanent placement and Protiviti operations continued to show very strong results, growing year-over-year revenues by 73% and 37%, respectively. Our temporary and consultant staffing operations also performed well and had year-over-year revenue growth of 31%, with particular strength in Management Resources, which grew 56%. Compared with the pre-pandemic fourth quarter of 2019, 2021 revenues were higher by 15% and net income was higher by 49%. Return on invested capital for the company was 50% in the fourth quarter.

"We begin the new year with tremendous momentum and optimism, and remain laser focused on our time-tested corporate purpose — to connect people to meaningful and exciting work and provide clients with the talent and deep subject matter expertise they need to confidently compete and grow. We are proud that our commitment to diversity, equity and inclusion efforts has earned us recent recognition, including placement on the Bloomberg Gender Equality Index and the Human Rights Campaign's list of Best Places to Work for LGBTQ+ Equality," Waddell concluded.

Robert Half management will conduct a conference call today at 5 p.m. EST. 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 (+1-706-643-9224 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. EST on January 27 and ending at 10:59 p.m. EST on February 24. The dial-in number for the replay is 855-859-2056 (+1-404-537-3406 outside the United States). To access the replay, enter conference ID# 8757184. The conference call also will be archived in audio format on the company's website at www.roberthalf.com.

Robert Half is the world's first and largest specialized talent solutions and business consulting firm that connects opportunities at great companies with highly skilled job seekers. The Company offers contract and permanent placement solutions for finance and accounting, technology, marketing and creative, legal, and administrative and customer support roles. Named to FORTUNE's World's Most Admired Companies and 100 Best Companies to Work For lists and a Forbes Best Employer for Diversity, Robert Half is the parent company of Protiviti®, a global consulting firm that provides internal audit, risk, business and technology consulting solutions.

Robert Half has 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 contract 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; the Company's ability to maintain its margins; the possibility of the Company incurring liability for its activities, including the activities of its contract employees, or for events impacting its contract 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 broad-based consulting, regulatory compliance, technology services, public sector or other high-demand advisory 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
December 31,


Year Ended December 31,


2021


2020


2021


2020


(Unaudited)


(Unaudited)











Service revenues

$ 1,769,917


$ 1,304,086


$ 6,461,444


$ 5,109,000

Costs of services

1,025,799


789,744


3,765,416


3,096,389









Gross margin

744,118


514,342


2,696,028


2,012,611









Selling, general and administrative expenses

544,551


425,161


1,951,282


1,666,041

Income from investments held in employee deferred compensation
trusts (which is completely offset by related costs and expenses)

(23,040)


(40,542)


(61,078)


(75,188)

Amortization of intangible assets

517


217


2,241


1,219

Interest income, net

(52)


(79)


(197)


(1,343)









Income before income taxes

222,142


129,585


803,780


421,882

Provision for income taxes

54,198


35,169


205,154


115,606









Net income

$ 167,944


$ 94,416


$ 598,626


$ 306,276









Diluted net income per share

$ 1.51


$ .84


$ 5.36


$ 2.70









Shares:








Basic

109,488


112,059


110,482


112,729

Diluted

111,020


112,941


111,718


113,318

ROBERT HALF INTERNATIONAL INC.

SUPPLEMENTAL FINANCIAL INFORMATION

(in thousands)




Year Ended
December 31,



2021


2020



(Unaudited)



SELECTED CASH FLOW INFORMATION:





Depreciation


$ 52,210


$ 62,281

Capitalized cloud computing implementation costs


$ 31,240


$ 33,178

Capital expenditures


$ 36,611


$ 33,377

Open market repurchases of common stock (shares)


2,796


2,506








December 31,



2021


2020



(Unaudited)



SELECTED BALANCE SHEET INFORMATION:





Cash and cash equivalents


$ 619,001


$ 574,426

Accounts receivable, net


$ 984,691


$ 714,163

Total assets


$ 2,952,359


$ 2,557,424

Total current liabilities


$ 1,358,673


$ 1,046,626

Total stockholders' equity


$ 1,381,051


$ 1,205,289

ROBERT HALF INTERNATIONAL INC.
SUPPLEMENTAL FINANCIAL INFORMATION (UNAUDITED)
(in thousands)

Beginning in Q3 2020, the Company modified its presentation of service revenues for Accountemps, OfficeTeam, Robert Half Technology and Robert Half Management Resources to include inter-segment revenues from services provided to Protiviti in connection with the Company's managed business solutions. This is how the Company measures and manages these divisions internally. The combined amount of divisional intersegment revenues with Protiviti are aggregated and then eliminated as a single line item. The Company has prepared the below schedule to provide readers with historical comparative information to better evaluate the related trends.


2019


2020


2021


Q1


Q2


Q3


Q4


Q1


Q2


Q3


Q4


Q1


Q2


Q3


Q4

SERVICE REVENUES:
























Accountemps

$ 490,084


$ 494,582


$ 501,905


$ 498,650


$ 489,884


$ 331,542


$ 351,598


$ 385,000


$ 417,116


$ 453,342


$ 492,558


$ 507,555

OfficeTeam

252,633


261,952


267,023


259,147


239,979


136,299


173,685


214,985


220,467


263,192


279,370


295,872

Robert Half Technology

182,426


189,461


195,630


198,314


196,652


162,028


161,007


175,730


172,239


194,233


215,500


213,414

Robert Half Management Resources

196,003


195,236


200,421


201,097


211,878


165,031


154,917


167,116


183,271


210,550


239,807


260,649

Elimination of intersegment revenues

(36,519)


(38,519)


(46,518)


(50,883)


(46,273)


(41,514)


(59,816)


(92,393)


(103,818)


(143,036)


(172,534)


(161,004)

Temporary and consultant staffing

1,084,627


1,102,712


1,118,461


1,106,325


1,092,120


753,386


781,391


850,438


889,275


978,281


1,054,701


1,116,486

Permanent placement staffing

131,562


140,894


134,582


126,394


120,489


71,030


87,203


91,387


111,703


143,640


156,444


158,133

Protiviti

252,341


272,779


299,089


304,666


294,082


283,910


321,303


362,261


397,402


458,660


501,421


495,298

Total

$ 1,468,530


$ 1,516,385


$ 1,552,132


$ 1,537,385


$ 1,506,691


$ 1,108,326


$ 1,189,897


$ 1,304,086


$ 1,398,380


$ 1,580,581


$ 1,712,566


$ 1,769,917

























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 the following non-GAAP measures: adjusted gross margin; adjusted selling, general and administrative expense; segment income; combined segment income; and as adjusted revenue growth rates.

The following measures: adjusted gross margin; adjusted selling, general and administrative expense; and segment income include gains and losses on investments held to fund the Company's obligations under employee deferred compensation plans. The Company provides these measures because they are used by management to review its operational results.

Combined segment income is income before income taxes, adjusted for interest income, net and amortization of intangible assets. The Company provides combined segment income because it is how management evaluates segment performance.

Variations in the Company's financial results include the impact of changes in foreign currency exchange rates and billing days. 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 and constant currency exchange rates.

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 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

ADJUSTED SUMMARY OF OPERATIONS RECONCILIATION (UNAUDITED)

(in thousands)



Quarter Ended December 31,


Relationships


2021


2020


2021


2020


2021


2020


Reported


Adjustments


Adjusted (1)


Reported


Adjustments


Adjusted (1)


Reported


Adjusted

SERVICE REVENUES:




















Accountemps

$ 507,555


$ —


$ 507,555


$ 385,000


$ —


$ 385,000


28.7%


29.5%


28.7%


29.5%

OfficeTeam

295,872



295,872


214,985



214,985


16.7%


16.5%


16.7%


16.5%

Robert Half Technology

213,414



213,414


175,730



175,730


12.1%


13.5%


12.1%


13.5%

Robert Half Management Resources

260,649



260,649


167,116



167,116


14.7%


12.8%


14.7%


12.8%

Elimination of intersegment revenues

(161,004)



(161,004)


(92,393)



(92,393)


(9.1%)


(7.1%)


(9.1%)


(7.1%)

Temporary and consultant staffing

1,116,486



1,116,486


850,438



850,438


63.1%


65.2%


63.1%


65.2%

Permanent placement staffing

158,133



158,133


91,387



91,387


8.9%


7.0%


8.9%


7.0%

Protiviti

495,298



495,298


362,261



362,261


28.0%


27.8%


28.0%


27.8%

Total

$ 1,769,917


$ —


$ 1,769,917


$ 1,304,086


$ —


$ 1,304,086


100.0%


100.0%


100.0%


100.0%





















GROSS MARGIN:




















Temporary and consultant staffing

$ 444,295


$ —


$ 444,295


$ 327,181


$ —


$ 327,181


39.8%


38.5%


39.8%


38.5%

Permanent placement staffing

157,862



157,862


91,172



91,172


99.8%


99.8%


99.8%


99.8%

Protiviti

141,961


3,283


145,244


95,989


5,419


101,408


28.7%


26.5%


29.3%


28.0%

Total

$ 744,118


$ 3,283


$ 747,401


$ 514,342


$ 5,419


$ 519,761


42.0%


39.4%


42.2%


39.9%





















SELLING GENERAL AND ADMINISTRATIVE EXPENSE:




















Temporary and consultant staffing

$ 347,826


$ (17,705)


$ 330,121


$ 287,550


$ (31,715)


$ 255,835


31.2%


33.8%


29.6%


30.1%

Permanent placement staffing

132,712


(2,052)


130,660


86,572


(3,408)


83,164


83.9%


94.7%


82.6%


91.0%

Protiviti

64,013


...

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting