Gary Burnison - CEO Bob Rozek - EVP and CFO Gregg Kvochak - SVP of IR.

Tim McHugh - William Blair Tobey Sommer - SunTrust Robinson Humphrey Mark Marcon - Robert W. Baird Marc Riddick - Sidoti & Company.

Ladies and gentlemen, thank you for standing by, and welcome to the Korn/Ferry Third Quarter Fiscal Year 201 Conference Call. At this time, all participants are in a listen-only mode. Following the prepared remarks, we will conduct a question-and-answer session. As a reminder, this conference is being recorded for replay purposes.

We have also made available in the investor relations section of our website at kornferry.com, a copy of the financial presentation that we will be reviewing with you today. Before I turn the call over to your host, Mr. Gary Burnison, let me first read a cautionary statement to investors.

Certain statements made in the call today, such as those relating to future performance, plans, goals, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, investors are cautioned to not place undue reliance on such statements.

Actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties which are beyond the Company's control.

Additional information concerning such risks and uncertainties can be found in the release relating to this presentation and in the periodic reports filed by the Company with the SEC, including the Company's annual report for fiscal 2017 and the company’s soon to be filed quarterly torpor for the quarter ending January 21.

Also, some of the comments today may reference non-GAAP financial measures, such as adjusted fee revenue, constant currency amounts, EBITDA and adjusted EBITDA.

Additional information concerning these measures, including reconciliations to the most directly comparable GAAP financial measures, is contained in the financial presentation and earnings release relating to this call, both of which are posted in the investor relations section of the company’s website at www.kornferry.com.

With that, I'll turn the call over to Mr. Burnison. Please go ahead, Mr. Burnison..

Okay. Thanks, Lori. Good afternoon, everybody. Thanks for joining us. I’ve got Bob Rozek and Gregg Kvochak here in beautiful sunny Los Angeles. To say that I'm proud of our organization is a complete understatement. I'm very, very proud and pleased to report 17% year over year growth for the quarter.

Fee revenue was $448 million and profitability was also very, very solid. There's no question that today we are truly a global organizational consulting firm. And when you look around the world and you consider the speed of change today, organizations that are not working beyond their potential will fail.

And the health of any business, any client business, any company, depends on how they synchronize strategy and talent. And that's exactly what we do as an organizational consulting firm. We enable people and organizations to exceed their potential.

We help them design their organization, the structure, the roles, the responsibilities, as well as how well they compensate, develop and motivate their people. And as importantly, we help organizations select and hire the talent they need to execute their strategy. So I'm probably more proud than I've ever been of our company and our team.

As we look at the business, and Bob and Gregg will get into it in more detail, but our signature business, Search, which gives us unparalleled access, was up 18%. Futurestep was up 29%, and our advisory Hay Group was up 13% for the quarter. Going forward, we're going to continue to maintain a relentless focus on the how of our strategy.

Number one, driving an integrated, proactive data driven go-to-market strategy, which is going to include more and more of an industry and solution orientation rather than line of business focus. Secondly, we're going to continue to differentiate the client in executive experience with proprietary world class IP.

Three, we're going to make our brand more elastic. Fourth, we're going to continue to cement our firm as the place to work, the premier career destination in the industry. And finally, we’re going to continue to execute on a pragmatic M&A strategy.

And within those overall strategic pillars, we certainly have several growth initiatives for the next phase of our journey. One would be leadership development. Second would be rewards and benefits. Third would be products. Fourth would be healthcare. And finally, our focus on marquee accounts, those where we have the strongest opportunity for impact.

Each of these areas really offer the potential to substantially scale our business. I would say that the progress that we've made is tangible. Korn Ferry is now more than the world leader in Executive Search. The scale and the scope of our broader offerings account for more than half of our revenue.

And so indeed, we are enabling people and organizations to exceed their potential. With that, I'm going to turn it over to Bob, then Gregg.

Bob?.

Great. Thanks, Gary. As Gary indicated, we are very, very pleased with the progress we're making. And as usual, I'm going to start out with a few key highlights. So first, global fee revenue continues to improve and growth has now accelerated for three consecutive quarters.

Historically, the third quarter has been our seasonally low quarter, but this year was very strong and our global fee revenue reached an all-time high of almost $448 million, which was up 70% year over year, and that's about just over 13% at constant currency.

Our growth was broad based, with each of our major operating segments achieving double digit growth. Growth continued to be strongest for the talent acquisition businesses, Executive Search and Futurestep, which grew year over year by approximately 18% and 29%.

Revenue growth for Hay Group was also very strong, reaching almost 13% in the third quarter. And that was enabled by the addition of new consultant talent, as well as our continued focus on solution sets and our go-to-market activities.

Second, in the third quarter, growth in earnings also accelerated despite the recent investments in additional consultants and support staff in each of our business segments, our adjusted EBITDA and adjusted EBITDA margin improved year over year.

Adjusted EBITDA grew to $70.3 million in the third quarter, which is a $15 million improvement or 27% year over year, while our adjusted EBITDA margin improved 120 basis points year over year to 15.7%. Third, I’ll talk a little bit about the effect of the US tax reform legislation on our effective tax rate.

If you exclude the one-time net adjustments for the revaluation of our deferred taxes of about $4.9 million, and our estimate of $16.3 million for the transition tax on our historical foreign earnings and profits, our effective tax rate was about 27.7% in the third quarter, and is estimated to be approximately 29% for the full year.

Going forward, we anticipate that the changes in US tax legislation will have a positive benefit for us. If you assume our earnings mix by country stays consistent, we expect our effective tax rate in the future to be between 25% and 26%. Finally, in the third quarter, we continued to return capital to our shareholders.

In the third quarter, we paid a quarterly cash dividend of $0.10 per share and we used about $3.3 million to repurchase stock. Over the last six quarters, we have now repurchased approximately 2.1 million shares at an average price per share of approximately $29 and using about $61 million of cash.

Now I’m going to talk a little bit about our new business trends and let's start with Executive Search. Globally, new business wins for Executive Search in the third quarter were strong, building up the positive momentum we saw in the second quarter.

In the third quarter, Executive Search new business globally was approximately $178 million, and that's up 19% year over year, driven by strength in North America, Europe and Asia Pac.

Similarly, new business growth in the third quarter for the Hay Group was strong, coming in at $210 million and that’s up about 20% year over year and up double digits for the second consecutive quarter.

And with respect to Futurestep, after back to back record quarters in Q1 and Q2, new business in the third quarter was slower at approximately $40 million. But the pipeline of new business opportunities remained strong in the fourth quarter. At the end of the third quarter, our total cash and marketable securities were $529 million.

That’s up about $62 million compared to the third quarter of fiscal ’17. Excluding amounts reserved for bonuses and deferred comp arrangements, our investable cash balance at the end of the third quarter is approximately $242 million, and it's up about $15 million year over year.

We also had outstanding debt at the end of the second quarter of about 244 million. Finally, adjusted fully diluted earnings per share were $0.70 in the third quarter. Fiscal ‘18 it's up $0.17 or 32% compared to the third quarter of fiscal ’17.

On a GAAP basis, which includes the onetime effects of the change in the US tax law, as well as the ongoing amortization of retention bonuses related to the Hay Group acquisition, our fully diluted earnings per share were $0.48. I’m going to turn it over to Gregg now who will view our operating segments in a little bit more detail..

Okay. Growth for our Executive Search segment remained strong in the third quarter as global fee revenue reached $180.4 million, a new all-time high. Compared year over year and measured at actual exchange rates, global Executive Search fee revenue grew $27.6 million or 18% in the third quarter, and over 14% measured at constant currency.

Regionally, growth in the third quarter was broad based, with North America up 21%, Europe up 19% and Asia Pacific up 17%. By Executive Search specialty practice, growth in the third quarter was also broad based. Compared to the third quarter a year ago, our technology practice grew 30%.

Our consumer goods and life sciences and healthcare practices were each up 21%, while our industrial and financial services practices grew 70% and 4% respectively. The total number of dedicated executive recruitment consultants worldwide at the end of the third quarter was 536, up 29 year over year and essentially flat sequentially.

Annualized fee revenue production per consultant in the third quarter was $1.34 million, and the number of new Search assignments opened worldwide in the third quarter was 1,564, which was up approximately 8% year over year. Adjusted EBITDA for our Executive Search in the third quarter was $37.2 million, up $4.6 million or 4% year over year.

Adjusted EBITDA for Executive Search was impacted by higher compensation expense resulting from our hiring of new consultants, higher variable bonus expense related to the sharp increase in fee revenue, as well as an increase in market - the market value of the assets backing the firm's deferred compensation plan.

As in the past, quarterly market driven gains or losses in the value of the assets backing the firm's deferred compensation plan, are recorded as increases or decreases in compensation expense, and primarily affect North America Executive Search.

The consolidated adjusted EBITDA margin for Executive Search in the third quarter of fiscal ‘18 was 20.6%, compared to 21.3% in the third quarter of fiscal ’17. Now turning to the Hay Group, where fee revenue growth improved for the third consecutive quarter.

In the third quarter, Hay Group achieved fee revenue of $198 million, which was up 12% year over year and 8% measured at constant currency. Improvement was driven primarily by double digit growth in both Europe and Asia Pacific regions.

As previously mentioned, new business awards for the Hay Group in the third quarter accelerated and improved approximately 20% measured year over year. Additionally, we saw new business awards improve sequentially each month in the quarter. Growth in fee revenue drove earnings and profitability higher for the Hay Group.

In the third quarter, adjusted EBITDA was $36.9 million, an improvement of $6.8 million or nearly 23% year over year, with an adjusted EBITDA margin of 18.6%, which was up 150 basis points year over year. Finally, turning to Futurestep, which achieved another quarter of accelerating double digit growth.

In the third quarter, Futurestep generated $69.1 million of fee revenue, which was up 29% year over year at actual rates, and up nearly 25% at constant currency. Futurestep’s earnings also improved in the third quarter, with EBITDA of $10.8 million and an EBITDA margin of 15.6%, which were both up year over year.

Now I’ll turn the call back over to Bob to discuss our outlook for the fourth quarter of fiscal ’18..

Okay. So new business activity entering calendar year 2018 has remained strong for all of our business segments. Globally, for Executive Search, new business awards in the month of January reached an all-time high. In February, new business was up approximately 6% year over year.

If monthly new business patterns remain consistent with prior years, we expect Executive Search new business awards to remain strong through the end of our fiscal year. For the Hay Group, the fourth quarter is also typically a seasonally strong quarter, and we expect improvements in both new business and revenue in the fourth quarter.

With regards to Futurestep, with business under contract and the strong pipeline of potential new business opportunities, we expect continued growth in that business in the fourth quarter as well.

Now, considering all these factors and assuming worldwide economic conditions, financial markets and foreign exchange rates remain steady, and as previously discussed, assuming our effective tax rate for FY’18 approximates 29%, we expect our consolidated fee revenue in the fourth quarter to range from $448 million to $462 million, with growth in all of our lines of business.

And we expect our consolidated adjusted diluted earnings per share to range from $0.69 to $0.73. Finally, consistent with prior quarters, our financial results in the fourth quarter will include the amortization of integration and acquisition costs of approximately $2.3 million for the retention bonuses related to the Hay Group acquisition.

Including these costs, we estimate that fiscal ‘18 fourth quarter fully diluted earnings per share measured by US GAAP, will likely be in the range of $0.66 to $0.70. Now that concludes our prepared remarks, and we would be glad to answer any questions you may have..

[Operator Instructions]. And our first question from the line of Tim McHugh with William Blair. Please go ahead. .

Yes. Thanks. Just a couple of questions. One, can you elaborate on Hay’s performance? I know it seemed like you called out Asia and Europe more so than the US. I guess just what you're seeing there.

Is that market share if you will, or do you think the demand got better in the marketplace? And then just a little bit if you can I guess comment as well on size of cases. Are there bigger things in there that kind of can be lumpier or is it kind of broad based? Thanks..

Demand certainly helps. We’ve got an incredible team. You will recall that when we did the acquisition of Hay Group a little over two years ago, 80% of the capability was outside the US.

So it would follow that a bigger driver - to the extent that we've successfully integrated that business, a bigger driver would be outside the US, and in fact that's what’s happened. So we did see a very, very strong growth in EMEA and Asia.

When you look at the Hay Group business, the advisory business, I would really think of it as four solutions there, organizational strategy, assessment and succession, leadership development, rewards and benefits. So those four are broad solution areas within the Hay Group.

When you look at this past quarter, where we saw the most lift was organizational strategy. That was up about 17%. And rewards and benefits was up about 17%. So that’s the landscape. I'm very, very - I feel good about the US segment of that business. I’m encouraged by the new business that we've seen there.

So I think it's a question - it's a combination of a great acquisition, having a great team, fueled by demand. .

Got it.

And did you - I apologize if I missed it, but at what pace did Hay grow in the US?.

In the US, the growth was marginal. I mean it was very, very small compared to Europe and Asia. But when you look at the new business and look, it doesn't always convert necessarily, but you look at the new business the past five or the last six months in North America has been very strong..

Okay. And then on the product side, the press release gives a dollar basis in terms of the growth, but I don't have - or dollar number for the growth here, but I don't have a basis for that.

Are you seeing the product side of the business turn as well?.

Yes. We’re beginning to see that. That’s going to take longer, but when you look at the advisory business and the product business, they were up about 13%, so both were up about the same percentage. I would hope that the products business is up again in the fourth quarter, maybe not as much as it was in the third quarter.

But that one will - it has a substantial market opportunity for us. But as I've talked about in the past, we are really completely redesigning the platform, the value proposition. And so that ramp up is going to take longer, but the payoff is bigger..

Okay. Thank you. .

Our next question from Tobey Sommer with SunTrust. Please go ahead. .

Thanks. Gary, starting off, I was wondering if you could tell us what your plans are to really kind of sustain a pretty good rate of growth in that product and licensing business, and how big you think it can be if you can pick your timeframe, medium term, long term. Thank you.

Yes, I think we'll double the business medium term. Let’s call that three to five years, again assuming that the economic conditions are what we're looking at today. I mean that can obviously change. But I do believe it has that kind of opportunity.

We are working very, very hard at redesigning a platform and creating a technology platform that is anchored in all of our intellectual property and a platform that clients can use to hire people, to assess people, to figure out how to pay people, and to develop people.

Remember that today that product business has almost no revenue from talent acquisition and that right there is a big opportunity for us. So we're working hard at this. It’s going to take us some time. It’s not a flip of the switch, but I am telling you that the intellectual property is there and the access that we have is there. .

I was wondering if you could discuss cross selling, how big a factor it is for growth today, where you’re having the most success and then as a third element, maybe where you see the most opportunity over time?.

Yes. I think the word cross selling is kind of fool's gold, but I do believe that in professional services, to the extent that you can differentiate yourself, to the extent that you can deliver more value off a wider platform, you will indeed drive greater penetration.

If you look this quarter and just take the Hay Group business, the advisory business, 20% of that business comes from Search. If you take the Futurestep business this last quarter, it was well north of that percentage. So it is clearly I think the ultimate hidden weapon that we have. We have unparalleled access.

We place somebody in a job every three minutes. That affords us to broaden the conversation. So the ability to penetrate clients is something that we are working on every single day and we have to get better. .

And Tobey, this is Bob. The only thing I would add to that as well is we track the number of referral opportunities that occur each quarter. And since we bought the Hay Group, that - it was right around 200 people who are participating in the referral program. Today, we've got north of 300 and we see that - the adoption rate continuing to grow. .

Okay, thanks. I’ll try to steer clear of fool's gold with this next question and ask you about returns and if you have given more thought to a target or where you can improve returns and what you could achieve maybe over the next couple of years? Thank you..

When you say returns, you're talking about ROIC?.

Yes sir..

Yes. Well, year to date it’s about 10.5%. And in this kind of economic environment that we're sitting in right now, and that could obviously change, but looking at the world today, I would like to hold out and shoot for a target that is substantially higher than that.

And so is it reasonable that ROIC could be raised by 50 bps, 100 bps, 200 bps in this kind of economic climate under a reasonable investment horizon? I think it is. .

Okay. I guess I'm a little surprised that you wouldn't say more improvement than that because I look back at the history, there have been periods of time where the ROIC I think has been higher than that.

Is there any - can you give us a little bit more color?.

Well, my dad always told me it’s better to under promise and over deliver. And so I think that actions speak louder than words. And so this is a public company. We are very cognizant that at the end of the day, we're stewards and growers for shareholders and we have to be earning a return that is beyond our cost of capital. And so we get that.

We take capital allocation very, very seriously and we have to continue to work towards a balance that is investing in the company for the long term, because ultimately this is a multibillion dollar company with 20,000, 30,000 employees impacting the world.

So we have to balance investing for that long game, and also making sure that we're delivering to today's shareholders. And we continually look at that balance. And I do think that the economic background and context is very important for answering that question. .

Thank you. Last question for me. You got Hay growing at a good clip now and it looks like the business indicating that there's some momentum there.

Do you look at further acquisitions now in earnest or how are you thinking about use of cash?.

We’ve never changed the playbook. We’re always looking at ways that we can put ourselves out of business. And so we are always looking at new businesses and investment opportunities which would include talent, not only developing talent but talent from the outside as well as M&A. so we'll continue to have a pragmatic approach.

I think we've done 10 acquisitions since I've been CEO. I think we've delivered on all 10 of those, and we do what we say. .

Thank you very much. .

And next question is from Mark Marcon with Baird. Your line is open. .

Good afternoon and Gary, Bob, Gregg, congrats. It was a really nice quarter.

With regards to - on the Executive Search side, can you give us a feel for what you're seeing just in terms of comp levels and how that's impacting the fee structure right now?.

We - our own work that we do and we - with our comp business, we deal with 20,000 companies, 24 million executives. So we have some pretty robust data points. We look at that and say we're forecasting about 2.5%, 3% wage growth in this calendar year. That’s what our scientists would say. And we're seeing that for sure in the marketplace. .

It's not even a little bit stronger than that in terms of like C-Suite and key talent areas?.

It obviously is. That's a broad swathe across the entire labor force..

Yes. I was thinking more about the people that you're placing and those structures and what you're seeing in terms of upticks, things of that nature..

Yes. The upticks have been kind of a steady part of this business. Our average - if you take the Search business for example, our average revenue per partner right now is a 1,340,000. It’s - we think there's upside to that number.

Now, how much of that number will be delivering on the broader platform? How much will it be through wage growth, working at the top? It’s kind of hard to say. But clearly the labor market is very tight..

Yes.

And then given the tightness of the labor market and Gary, you've always been really thoughtful about this, how are you thinking about where you are from a capacity perspective across the globe? And then how are you thinking about adding capacity relative to where we are from a cyclical perspective? Obviously US has been in an expansion for quite some time now..

Let me answer that question with data. 60% of our revenue is derived from clients where we do it least two lines of business or two solution areas. There are many, many, many other clients that I would consider to be white space.

So at 38,000 feet, if you want to address it on a macro basis, I do think there is substantial capacity to deepen the relationships. Now, how much incremental cost we will need to add to that is another story. But I look at this and I say well, the Search business definitely there's capacity there. Is that 15%? Could be.

And the - I think the other solutions that we have, it's really - I think it's a question of continuing to develop talent, upgrade our talent within the organization, bring talent from outside.

But then to really kind of get at this question of interdependence and this question of oneness and can we indeed drive deeper, more meaningful, more impactful relationships with clients. And so I think we've made good progress in that 60% of the revenue is from clients that have used at least two major solution areas.

But I think there's more we can do. .

Great.

With regards to that, can you talk about the deepness of the relationships with regards to some examples of clients that have used you for organizational structure and types of projects and coming back for more with the sustainability of the second and third and fourth sale?.

We certainly have. As you know, the Search business and to some extent, there is a part of the Futurestep business that is very, very episodic. But we’ve absolutely seen situations, look, 60% of the revenue is from those kind of situations where it's where we're - we may have done Search work and it leads to assessment and succession.

Or we do organizational strategy or culture change, setting up the leadership characteristics for a company and it actually leads to Search. So we've seen that. We’ve just got to see more of it..

Yes. And Mark, this is Bob. The other area I would focus your attention on is our marquee accounts. And if you go back probably to the Hay Group transaction, we were probably 23 - 24% of our total revenue came from marquee accounts.

And then with the Hay Group transaction and the level of products revenue that they had, last year that dropped down to 17.6%. This year I expect that number to be closer back to 20% again. So we do continue to see those lasting relationships with our clients and we're growing that..

Great. And then with regards to the Hay Group in terms of North America, you mentioned that the new sales have been building up, but so far the fee revenue, at least in terms of the past quarters, hasn't really changed.

Are we going to see an inflection based on the new sales as it relates to Hay North America?.

Well, I would hope so. I mean I - look, I think that this last acquisition we did was heavily anchored outside the United States. So I think on the one hand, you look at the growth that's being delivered in Europe and Asia and you’d say okay well, it must be working.

The reality was that the capability that we picked up in the United States was just not a great capability. Don't get me wrong, but 80% of the business was outside the US. So clearly there's been - we've used it as a platform for IP globally. But we've also used it as a platform to drive deeper penetration in the US.

So again, actions speak louder than words. I would hope that this is an inflection point. We’ve got a great, great team. .

Great. And then just one last one and then I'll jump back in the queue.

On capital allocation, with all the pieces that you've put together, do you feel like we're at a point where we could probably continue to grow and achieve those goals that you mentioned for three to five years with what we have in place, or do we need to allocate more capital in order to achieve the vision? How do we think about return - you've done a great job in terms of returning cash to shareholders, but how do we think about that balance going forward?.

I think we have to continue to think of it as a balance. I would certainly not say that we have all the pieces and we're not going to deploy capital. I think that would short change long term shareholders for sure. But at the same time, we very much have to be mindful of the cost of capital.

And the 10.5% that we've delivered so far this year and we’ve got to strike - we’ve absolutely got to strike that balance as an organization. Our leverage is not significant for sure. When you look at the EBITDA that we're producing now, it's obviously less than one. So there's different ways to get at that capital question..

Great. Thanks a lot..

And next question is from Marc Riddick with Sidoti. Please go ahead. .

Good afternoon. I wanted to touch on the sequential changes and a couple of the industry practices and wondered if you could spend some time putting some color around that, the strength that we saw sequentially and the education and nonprofit area, as well as the sequential decline in financial services. .

We don't - it's very, very difficult to look at the sequential because you've got an October quarter and then you've got a January quarter that includes a lot of holidays. In financial services, if you're trying to look at it sequentially, you're going to find that the - there's just not a lot of movement.

Historically there hasn't been a lot of movement in terms of people and the like. Of course now the business is much broader. So I would probably - I wouldn't read too much in to a sequential change. It’s something I look at, but I’ve I never been overly obsessed with.

I found it much more meaningful to look at trailing six months, nine months to gauge trends. But the non-for-profit is an interesting opportunity for us. It's an area that we quite frankly we can leverage that in a much more profound way because now we've got real capability.

you've got an advisory business that’s $800 million and that business, the education non-for-profit, we engage, it’s largely - it has been up to this point largely Search in nature.

But when you look at the people that engages, you're going to find kind of the outliers of achievement and they're generally committees, charitable organizations, educational institution that have very, very prominent people. And I think it's an opportunity for us that we haven't fully gone after the way we should..

Okay. That’s interesting. Thank you. I appreciate that. One of the other things I wanted to circle back on to the balancing that you have between the year over year consultants count and maybe your thoughts around where that is. It’s relatively flat over the last couple of quarters or so.

So we're at the point now where that revenue per consultant growth nearly doubled that of the year over year change in consultants.

I wonder to see if you could - maybe the strength of the last quarter and the guidance that you're providing for the fiscal fourth quarter certainly would indicate that maybe that strength is clearly there and what you're seeing right now.

So I was wondering if there's been any slight changes in the thought as to going out to next year and beyond and maybe what that year over year consultant count might look like. Thank you..

Well, we certainly don't guide out that far, but you're certainly, you're seeing something play out that we put in place almost two years ago when we made this latest investment. And we said a couple of things, that we want to be an organizational consulting firm. We want to help people and organizations exceed their potential.

We have to do a better job internally providing career paths and developing capability so that we can clearly represent the entire firm in front of our clients.

The other thing we did very purposefully is we went out into the marketplace and if you've seen press releases over the last 15 months, we've gone out very, very purposefully over a sustained period of time and invested in talent that we thought could deliver the entire platform. So hopefully that that investment and the economy stays good.

Hopefully that investment continues to pay off. And so we're always in the market trying to develop talent and we're always, always in the market looking for talent. .

Okay, great. I appreciate. Thank you very much. .

The next question is from Tobey Sommer with SunTrust. Please go ahead. .

Thanks, I just wanted to follow up on the new business in Futurestep which I know can be a little bit episodic because some of the contacts are quite large What might it look like on a year to date basis or a trailing 12 month basis? Kind of the last couple of quarters were record quarters for me.

Just thought looking at it over a slightly longer period of time might be informative..

Yes, Tobey. I don't think we have that information at our fingertips, but it would definitely be up quite large, very double digits. Remember the last two quarters were record quarters of new business for Futurestep..

Okay. No worries. I can take it offline, but ….

Yes, we can follow up with you on that. .

Perfect. Thank you so much..

The next question is from Mark Marcon with Baird. Please go ahead. .

One question is just on the lumpiness and the bigger projects.

Are there any big projects that might be unwinding that we should be mindful of as we look out over the next six to 12 months where you’d say here's a couple that were pretty big and unusual?.

I can - I’m looking at Bob here and Gregg. I can't - I mean six to 12 months is a long ways out, but if I think about just the next three or four months, is there something that’s coming off? I don't think so, Mark. .

No, I’m thinking six months ahead in terms of like when we're sitting here nine months from now and we're doing year over year comparisons, is there anything that ….

We do have a - look, not in - yes. So when you asked the question I was thinking more around the RPO business. We do in Europe have a pretty sizable engagement with the government, and I can't disclose who it is, to develop their civil servants. And we won that business a lot time ago. And we've been at it a while.

I can't tell you if that winds - that actually winds down in nine months or 12 months, but that would certainly be one that would come to mind..

Is that bigger than a bread box?.

I don't even know what a bread box is, man. Do people even use bread boxes anymore? Like in Kansas we had a ….

Yes.

So that would be about a $20 million to $10 million?.

No, we actually had a bread box in Kansas. Nobody ever used it, but we had it.

It's - I would say that inception to date, and I would say we probably started to recognize the revenue maybe three quarters ago, Gregg, something like that?.

Yes, sure..

And I would say inception today maybe it’s - was it $15 million, something like that?.

A - Yes. That’s right..

Okay. And so that's been going on for three quarters. There’s no ….

Or so. I mean I’m going right off the top of my head here. .

Well, it’s a big world so it's hard to keep track of all the contracts.

With regards to Europe, in terms of Executive Search, on a constant currency basis, what was that growth rate again?.

Let’s see. Europe Executive Search constant currency was 9.4% year over year, 19.5% or 20% basically at actual rates..

Okay.

And Asia Pac on a constant currency?.

Would be 11.3%. .

Great.

And then with regards to in Europe, what are you seeing in London?.

We're saying very, very solid growth. That business has been up. When I speak of London, I talk about our integrated business. So it's across everything. You’ve seen kind of 13%, 14% growth for the last two or three quarters. So it has been healthy. .

So no worries about Brexit?.

Oh, lots of words. And so we've got a number of things that we've put - that we've started to put in place going back again three or four quarters ago to try to position us. And a lot of worry about that for sure..

But not to fine. Nobody is freezing up..

No, nobody is - well, nobody is freezing up, but the level of investment into the UK is certainly people are - they're questioning, there's no doubt about that. .

So Gary, how are you thinking about managing that? Like if things do go south, you've always had contingency plans in place.

How should we think about that?.

We do. Yes, we do have contingency plans that I won't get into. But we've now spent a long time, have tried to do some things that would put us in a better shape for that event. But if that event happens, that is a dark day. Not - that is a dark day for the economy. .

Let’s hope it doesn't happen. Thanks. .

Thank you. And it appears there are no further questions, Mr. Burnison..

Okay. Well listen, I just want to thank our shareholders, thank our board, but certainly our colleagues that we have. We’re very, very encouraged and optimistic about the future, and we look forward to speaking to you soon. Thank you..

Thank you. And ladies and gentlemen, this conference will be available for replay for one week, starting today at 6.30 p.m. Eastern Standard Time, running through the day March 13th, ending at midnight. You may access the AT&T Executive Playback service by dialing 1-800-475 -6701 and entering the access code, 445543.

International participants may dial 320-365-3844. Again, the access code is 445543. Additionally, the replay will be available for playback at the company’s website, www.kornferry.com in the Investor Relations section. And that will conclude our conference and you may now disconnect. Thank you..