Post on 27-Feb-2018
transcript
William Blair & Company 35th Annual Growth Stock Conference June 9-11, 2015 Keith Waddell, Vice Chairman, President and CFO
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Company Background
2
§ Founded in 1948 as franchised business § First and largest staffing firm specializing in accounting
and finance positions § In 1986, acquired franchisor with no company operations
and began process of acquiring all franchises
§ Opened offices worldwide and launched new professional staffing divisions
§ In 2002, entered the risk consulting and internal audit business through formation of Protiviti
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Awards and Recognition
“Most Admired Companies”
(1998‒2015)
“Best Places to Work” lists around the world
Responsible Investment Index
(2008‒2015) Barron’s 400 Index
FORTUNE® W O R L D ’ S M O S T A D M I R E D C O M P A N I E S 2 0 1 5
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Protiviti a “Best Company to Work For”
(2015)
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Global Operations
Europe Austria Belgium France Germany Italy Luxembourg Netherlands Switzerland United Kingdom
Middle East UAE
South America Brazil Chile
North America Canada United States
More than 400 offices in 20 countries worldwide
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Asia-Pacific Australia China India Japan New Zealand Singapore
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
79%
21%
Robert Half Revenue Mix* – By Geography
United States International
*Q1 2015 Staffing Revenues
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
3%4%
4%
10%21%
Robert Half Revenue Mix* – International
Percentage of Global Staffing Revenues
Continental Europe
Canada
Asia-Pacific
U.K.
International
*Q1 2015
6
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
1%#2%#3%#
4%#
Other
Robert Half Revenue Mix* – Continental Europe
Percentage of Global Staffing Revenues
Germany
Belgium
France
Continental Europe
10%
*Q1 2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Robert Half Revenue Mix* – Business Segments
78%
14%
8%
Permanent Placement
Risk Consulting and Internal Audit
Temporary and Consulting
*Q1 2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Our Brands
Specialized Staffing
Project Skills
Project Management
and Deliverables
Recruiting
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Business Strategy
§ Value proposition: Only full-time jobs require full-time staff
§ Clients value specialization in professional segments
§ Middle-market accounts are smaller, less price-sensitive; clients are demanding, quality is key
§ Internal staff must possess specialized skills
§ Protiviti provides consulting, project management, co-sourcing and outsourcing capabilities
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Accounting Staffing Demand
§ U.S. job growth for financial analysts, accountants and auditors expected to outpace national average between 2012 and 2022*
§ Bookkeeping, accounting and auditing among top 15 occupations with highest projected job growth between 2012 and 2022*
§ Low unemployment in many roles (U.S. Bureau of Labor Statistics, Q1 2015)
– Financial analysts: 1.8% – Financial managers: 2.8% – Accountants and auditors: 2.9%
*BLS Occupational Outlook Handbook, 2014-2015 Edition
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Technology Staffing Opportunity
§ IT staffing market is 3-4 times larger than accounting staffing § Low unemployment for IT positions (U.S. Bureau of Labor Statistics, Q1 2015)
– Network and computer systems administrators: 0.9% – Computer and information systems managers: 1.1% – Software developers, applications and systems software: 1.5%
§ New application development demand at middle-market companies
Growing need for customized software, websites, mobile and social media
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Unique Robert Half/Protiviti Delivery Model
§ We provide world-class consulting and specialized staffing, under one roof, at an attractive price
§ Global and regional consulting firms that compete with Protiviti lack the flexible resource capabilities of our staffing operations
§ Staffing competitors lack in-house access to Big 4 consulting methodologies like those of Protiviti
Staffing Consulting Blended
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Marketing Approach § Positioned as quality leader through advertising and PR activities
– Thought leadership: published content, salary research, other resources
§ Content marketing: email/blogs/social media § Candidate and client website experience
– Gateway to expanded digital interaction – Local landing pages – Mobile-friendly – Dynamic content – Optimized for natural search rankings
§ Search engine marketing using data analytics and performance measurement § Digital display advertising, radio (national broadcast and online streaming)
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
20-Year Revenue History
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Robert Half F&A/Accountemps Other Services
Compounded Annual Growth 20 years ended 12/31/14
12.5% $4.7B
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
20-Year Cash Flow From Operations
$340.7M
Compounded Annual Growth 20 years ended 12/31/14
13.9%
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Return on Equity (20-Year Average & Q1 2015)
*Through Dec. 31, 2014
24.9%
31.7%
20-Year Average* Q1 2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Recent Operating Performance
§ 20 consecutive quarters of double-digit net income and EPS percentage growth on year-over-year basis
§ Secular shift to temporary jobs
§ Macroeconomic improvement
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Temporary and Consulting Revenue ($ in Billions) (2001‒Q1 2015)
$2.3
$1.8 $1.7
$2.2
$2.6
$3.1
$3.6 $3.6
$2.5 $2.6
$3.1$3.3 $3.4
$3.7
$0.86 $0.94
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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Q1 2015 14.5% growth y/y
(same-day, constant- currency basis)
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Temporary and Consulting Gross Margin % (2001‒Q1 2015)
36.6%
35.6%34.9%
36.0%36.5%
37.0%37.2%36.7%
34.1%34.1%
35.2%36.0%36.2%
36.6%36.1%
37.0%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Temporary and Consulting SG&A % (2001‒Q1 2015)
28.9%
32.9%32.7%
29.0%
27.0%26.9%27.0%27.1%
29.8%29.9%
28.3%27.7%27.3%
26.8% 27.0%27.1%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Temporary and Consulting Operating Income % (2001‒Q1 2015)
7.6%
2.7%2.2%
6.9%
9.5%10.0%10.2%
9.6%
4.2% 4.2%
6.9%
8.3%8.9%
9.8%9.0%
9.8%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Permanent Placement Revenue ($ in Millions) (2001‒Q1 2015)
$189
$100 $95
$136
$219
$336
$444$427
$182
$221
$302
$334$348
$395
$93 $98
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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Q1 2015 11.9% growth y/y
(same-day, constant- currency basis)
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Permanent Placement SG&A % (2001‒Q1 2015)
89.2%
106.8%
97.3%
87.5%
79.7%77.8%
80.6%
85.8%
103.7%
92.0%88.2%
83.3%84.3%80.1% 81.3%80.5%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Permanent Placement Operating Income %(2001‒Q1 2015)
10.8%
-6.8%
2.7%
12.5%
20.3%22.2%
19.4%
14.1%
-3.8%
7.9%
11.7%
16.7%15.6%
19.9%18.7%19.3%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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2002
2009
2009
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Protiviti Revenue ($ in Millions) (2004‒Q1 2015)
$352
$479
$543 $552 $547
$384 $386$424
$453
$528
$624
$134$164
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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Q1 2015 26.6% growth y/y
(same-day, constant- currency basis)
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Protiviti Gross Margin % (2004‒Q1 2015)
37.8% 39.8%36.6%
31.6%28.3%
20.8%25.2% 26.8% 25.9%
29.3% 29.4% 27.4% 28.8%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Protiviti SG&A % (2004‒Q1 2015)
19.9%21.6%
25.5%27.8% 26.9%
28.9% 28.1%25.6%
23.5%21.2% 19.7%
21.9%18.8%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Protiviti Operating Income %(2004‒Q1 2015)
17.9% 18.1%11.2%
3.8% 1.3%
-8.0% -2.8%
1.2%2.4%
8.1% 9.7%5.5%
9.9%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3 mos.2014
3 mos.2015
2009
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Strong Financial Position
Cash $261 million Total assets $1.6 billion Virtually no debt
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As of 03/31/15
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
*Through Dec. 31, 2014 **Cash flow from operations net of cash used for investing activities
Cash Returned to Shareholders ($ in Millions)
1 Year* 5 Years*
Free Cash Flow $ 252** $ 1,009**
Dividends
$ 98 38%
$ 428 40%
Share Repurchases
$ 162 62%
$ 650 60%
Total $ 260 100% $1,078 100%
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Robert Half Quarterly Dividend History Since Inception
$0.06 $0.07
$0.08
$0.10
$0.11 $0.12
$0.13 $0.14
$0.15
$0.16
$0.18
$0.20
$0.05
$0.06
$0.07
$0.08
$0.09
$0.10
$0.11
$0.12
$0.13
$0.14
$0.15
$0.16
$0.17
$0.18
$0.19
$0.20
25-‐M
ay-‐2004
25-‐Aug-‐2004
24-‐Nov-‐2004
25-‐Feb-‐2005
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25-‐Nov-‐2005
27-‐Feb-‐2006
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22-‐Nov-‐2006
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26-‐Nov-‐2007
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ay-‐2008
25-‐Aug-‐2008
25-‐Nov-‐2008
25-‐Feb-‐2009
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25-‐Aug-‐2009
25-‐Nov-‐2009
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ay-‐2010
25-‐Aug-‐2010
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ay-‐2011
25-‐Aug-‐2011
23-‐Nov-‐2011
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ay-‐2012
24-‐Aug-‐2012
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ay-‐2013
26-‐Aug-‐2013
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ay-‐2014
25-‐Aug-‐2014
25-‐Nov-‐2014
25-‐Feb-‐2015
22-‐M
ay-‐2015
11.6% CAGR
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Share Count Reduction (Millions)
Shares Outstanding
2009 148.6
2010 146.2
2011 142.1
2012 139.4
2013 137.5
2014 135.1
5-Year Reduction 13.5
% Reduction 9%
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© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Market Opportunity — Staffing Services
§ Annual global revenues for staffing industry approximately $400B USD
§ Highest number of U.S. job openings in professional/business services (BLS JOLTS report, May 2015)
§ Employment services among the 10 U.S. industries expected to add the most jobs through 2022 (BLS)
§ Long-term demographics — war for talent, retiring baby boomers
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§ Secular demand for flexible staffing; temp penetration rate at all-time high and growing
§ We work with less than 10 percent of target prospects
© 2015 Robert Half International Inc. An Equal Opportunity Employer M/F/Disability/Vet.
Market Opportunity — Protiviti
§ Solid base of recurring internal audit and financial controls demand
§ PCAOB audit inspections
§ Growing suite of consulting services – Financial services — regulatory
risk and compliance – Technology privacy, security and
controls
§ Protiviti/staffing blended solutions
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Thank You