(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number) |
Title of Each Class | Trading Symbol | Name of Each Exchange On Which Registered | ||||||
☒ | Accelerated filer | ☐ | ||||||||||||||||||
Non-Accelerated filer | ¨ | Smaller reporting company | ||||||||||||||||||
Emerging growth company |
PAGE | ||||||||
PART I. | ||||||||
Item 1. | ||||||||
Item 2. | ||||||||
Item 3. | ||||||||
Item 4. | ||||||||
PART II. | ||||||||
Item 1. | ||||||||
Item 1A. | ||||||||
Item 6. | ||||||||
March 31, 2022 | December 31, 2021 | |||||||||||||
(Unaudited) | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Accounts receivable, net of allowances of $ | ||||||||||||||
Prepaid expenses | ||||||||||||||
Other current assets | ||||||||||||||
Income taxes recoverable | ||||||||||||||
Total current assets | ||||||||||||||
Non-current assets | ||||||||||||||
Property and equipment, net | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Assets designated for retirement and pension plans | ||||||||||||||
Investments | ||||||||||||||
Other non-current assets | ||||||||||||||
Goodwill | ||||||||||||||
Other intangible assets, net | ||||||||||||||
Deferred income taxes | ||||||||||||||
Total non-current assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Current liabilities | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued salaries and benefits | ||||||||||||||
Deferred revenue | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Other current liabilities | ||||||||||||||
Income taxes payable | ||||||||||||||
Total current liabilities | ||||||||||||||
Non-current liabilities | ||||||||||||||
Accrued salaries and benefits | ||||||||||||||
Retirement and pension plans | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Other non-current liabilities | ||||||||||||||
Total non-current liabilities | ||||||||||||||
Total liabilities | ||||||||||||||
Commitments and contingencies (Note 17) | ||||||||||||||
Stockholders’ equity | ||||||||||||||
Preferred stock, $ | ||||||||||||||
Common stock, $ | ||||||||||||||
Treasury stock at cost, | ( | ( | ||||||||||||
Additional paid in capital | ||||||||||||||
Retained earnings | ||||||||||||||
Accumulated other comprehensive income | ||||||||||||||
Total stockholders’ equity | ||||||||||||||
Total liabilities and stockholders’ equity | $ | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Revenue | |||||||||||
Revenue before reimbursements (net revenue) | $ | $ | |||||||||
Reimbursements | |||||||||||
Total revenue | |||||||||||
Operating expenses | |||||||||||
Salaries and benefits | |||||||||||
General and administrative expenses | |||||||||||
Cost of services | |||||||||||
Research and development | |||||||||||
Restructuring charges | |||||||||||
Reimbursed expenses | |||||||||||
Total operating expenses | |||||||||||
Operating income | |||||||||||
Non-operating income (expense) | |||||||||||
Interest, net | |||||||||||
Other, net | ( | ||||||||||
Net non-operating income | ( | ||||||||||
Income before income taxes | |||||||||||
Provision for income taxes | |||||||||||
Net income | |||||||||||
Other comprehensive loss, net of tax | |||||||||||
Foreign currency translation adjustment | ( | ( | |||||||||
Other comprehensive loss, net of tax | ( | ( | |||||||||
Comprehensive income | $ | $ | |||||||||
Weighted-average common shares outstanding | |||||||||||
Basic | |||||||||||
Diluted | 20,171 | ||||||||||
Earnings per common share | |||||||||||
Basic | $ | $ | |||||||||
Diluted | $ | $ | |||||||||
Cash dividends paid per share | $ | $ | |||||||||
Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total | ||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common and treasury stock transactions: | |||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Vesting of equity awards, net of tax withholding | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividend equivalents on restricted stock units | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total | ||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | ||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2020 | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Common and treasury stock transactions: | |||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Vesting of equity awards, net of tax withholdings | — | — | ( | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividend equivalents on restricted stock units | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2021 | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Three Months ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Cash flows - operating activities | ||||||||||||||
Net income | $ | $ | ||||||||||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Deferred income taxes | ( | ( | ||||||||||||
Stock-based compensation expense | ||||||||||||||
Accretion expense related to earnout payments | ||||||||||||||
Gain on marketable securities | ( | |||||||||||||
Loss on disposal of property and equipment | ||||||||||||||
Changes in assets and liabilities: | ||||||||||||||
Accounts receivable | ( | ( | ||||||||||||
Accounts payable | ( | |||||||||||||
Accrued expenses | ( | ( | ||||||||||||
Restructuring accrual | ( | |||||||||||||
Deferred revenue | ||||||||||||||
Income taxes recoverable and payable, net | ||||||||||||||
Retirement and pension plan assets and liabilities | ||||||||||||||
Prepaid expenses | ( | ( | ||||||||||||
Other assets and liabilities, net | ( | ( | ||||||||||||
Net cash used in operating activities | ( | ( | ||||||||||||
Cash flows - investing activities | ||||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Purchases of marketable securities and investments | ( | ( | ||||||||||||
Proceeds from sales of marketable securities and investments | ||||||||||||||
Net cash provided by (used in) investing activities | ( | |||||||||||||
Cash flows - financing activities | ||||||||||||||
Cash dividends paid | ( | ( | ||||||||||||
Payment of employee tax withholdings on equity transactions | ( | ( | ||||||||||||
Net cash used in financing activities | ( | ( | ||||||||||||
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash | ( | ( | ||||||||||||
Net decrease in cash, cash equivalents and restricted cash | ( | ( | ||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | ||||||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | $ | ||||||||||||
March 31, | December 31, | ||||||||||||||||||||||
2022 | 2021 | 2021 | 2020 | ||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
Restricted cash included within other non-current assets | |||||||||||||||||||||||
Total cash, cash equivalents and restricted cash | $ | $ | $ | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Net income | $ | $ | |||||||||
Weighted average shares outstanding: | |||||||||||
Basic | |||||||||||
Effect of dilutive securities: | |||||||||||
Restricted stock units | |||||||||||
Performance stock units | |||||||||||
Diluted | |||||||||||
Basic earnings per share | $ | $ | |||||||||
Diluted earnings per share | $ | $ |
March 31, 2022 | December 31, 2021 | Change | |||||||||||||||
Contract assets | |||||||||||||||||
Unbilled receivables, net | $ | $ | $ | ||||||||||||||
Contract assets | |||||||||||||||||
Total contract assets | |||||||||||||||||
Contract liabilities | |||||||||||||||||
Deferred revenue | $ | $ | $ |
Balance at December 31, 2021 | $ | ||||
Provision for credit losses | |||||
Write-offs | ( | ||||
Foreign currency translation | ( | ||||
Balance at March 31, 2022 | $ |
Less Than 12 Months | Balance Sheet Classification | ||||||||||||||||||||||
Balance at March 31, 2022 | Fair Value | Unrealized Loss | Cash and Cash Equivalents | Marketable Securities | |||||||||||||||||||
U.S. Treasury securities | $ | $ | $ | $ |
March 31, 2022 | December 31, 2021 | ||||||||||
Leasehold improvements | $ | $ | |||||||||
Office furniture, fixtures and equipment | |||||||||||
Computer equipment and software | |||||||||||
Property and equipment, gross | |||||||||||
Accumulated depreciation | ( | ( | |||||||||
Property and equipment, net | $ | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Operating lease cost | $ | $ | |||||||||
Variable lease cost | |||||||||||
Total lease cost | $ | $ |
2022 | 2021 | ||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
Operating cash flows from operating leases | $ | $ | |||||||||
Right-of-use assets obtained in exchange for lease obligations: | |||||||||||
Operating leases | $ | $ |
2022 | 2021 | ||||||||||
Weighted Average Remaining Lease Term | |||||||||||
Operating leases | |||||||||||
Weighted Average Discount Rate | |||||||||||
Operating leases | % | % |
Operating Lease Maturity | |||||
2022 | $ | ||||
2023 | |||||
2024 | |||||
2025 | |||||
2026 | |||||
Thereafter | |||||
Total lease payments | |||||
Less: Interest | ( | ||||
Present value of lease liabilities | $ |
Cash and Cash Equivalents | ||||||||
Balance at March 31, 2022 | ||||||||
Cash | $ | |||||||
Level 1(1): | ||||||||
Money market funds | ||||||||
U.S. Treasury securities | ||||||||
Total Level 1 | ||||||||
Total | $ |
Cash and Cash Equivalents | ||||||||
Balance at December 31, 2021 | ||||||||
Cash | $ | |||||||
Level 1(1): | ||||||||
Money market funds | ||||||||
U.S. Treasury securities | ||||||||
Total Level 1 | ||||||||
Total | $ |
Balance Sheet Classification | ||||||||||||||||||||||||||||||||||||||
Fair Value | Other Current Assets | Assets Designated for Retirement and Pension Plans | Investments | Other Current Liabilities | Retirement and Pension Plans | |||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | ||||||||||||||||||||||||||||||||||||||
Measured on a recurring basis: | ||||||||||||||||||||||||||||||||||||||
Level 1(1): | ||||||||||||||||||||||||||||||||||||||
U.S. non-qualified deferred compensation plan | $ | $ | — | $ | — | $ | $ | — | $ | — | ||||||||||||||||||||||||||||
Level 2(2): | ||||||||||||||||||||||||||||||||||||||
Retirement and pension plan assets | — | — | — | |||||||||||||||||||||||||||||||||||
Pension benefit obligation | ( | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Total Level 2 | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ( | $ | ( |
Balance Sheet Classification | ||||||||||||||||||||||||||||||||||||||
Fair Value | Other Current Assets | Assets Designated for Retirement and Pension Plans | Investments | Other Current Liabilities | Retirement and Pension Plans | |||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | ||||||||||||||||||||||||||||||||||||||
Measured on a recurring basis: | ||||||||||||||||||||||||||||||||||||||
Level 1(1): | ||||||||||||||||||||||||||||||||||||||
U.S. non-qualified deferred compensation plan | $ | $ | — | $ | — | $ | $ | — | $ | — | ||||||||||||||||||||||||||||
Level 2(2): | ||||||||||||||||||||||||||||||||||||||
Retirement and pension plan assets | — | — | — | |||||||||||||||||||||||||||||||||||
Pension benefit obligation | ( | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Total Level 2 | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ( | $ | ( |
Earnout | Contingent Compensation | ||||||||||
Balance at December 31, 2021 | $ | ( | $ | ( | |||||||
Earnout accretion | ( | — | |||||||||
Compensation expense | — | ( | |||||||||
Foreign currency translation | — | ( | |||||||||
Balance at March 31, 2022 | $ | ( | $ | ( |
March 31, 2022 | December 31, 2021 | ||||||||||
Executive Search | |||||||||||
Americas | $ | $ | |||||||||
Europe | |||||||||||
Total Executive Search | |||||||||||
On-Demand Talent | |||||||||||
Total goodwill | $ | $ |
Executive Search | On-Demand Talent | ||||||||||||||||||||||||||||
Americas | Europe | Asia Pacific | Total | ||||||||||||||||||||||||||
Goodwill | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Accumulated impairment losses | ( | ( | — | ( | |||||||||||||||||||||||||
Balance at December 31, 2021 | |||||||||||||||||||||||||||||
Foreign currency translation | ( | — | |||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||
Accumulated impairment losses | ( | ( | — | ( | |||||||||||||||||||||||||
Balance at March 31, 2022 | $ | $ | $ | $ | $ |
March 31, 2022 | December 31, 2021 | ||||||||||
Executive Search | |||||||||||
Americas | $ | $ | |||||||||
Europe | |||||||||||
Asia Pacific | |||||||||||
Total Executive Search | |||||||||||
On-Demand Talent | |||||||||||
Total other intangible assets, net | $ | $ |
Weighted Average Life (Years) | March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||||||||||||||||||
Client relationships | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||
Trade name | ( | ( | |||||||||||||||||||||||||||||||||||||||
Software | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total intangible assets | $ | $ | ( | $ | $ | $ | ( | $ |
2022 | $ | ||||
2023 | |||||
2024 | |||||
2025 | |||||
2026 | |||||
Thereafter | |||||
Total | $ |
March 31, 2022 | December 31, 2021 | ||||||||||
Contract assets | $ | $ | |||||||||
Other | |||||||||||
Total other current assets | $ | $ |
March 31, 2022 | December 31, 2021 | ||||||||||
Earnout liability | $ | $ | |||||||||
Other | |||||||||||
Total other current liabilities | $ | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Salaries and benefits (1) | $ | $ | |||||||||
Income tax benefit related to stock-based compensation included in net income |
Number of Restricted Stock Units | Weighted- Average Grant-Date Fair Value | ||||||||||
Outstanding on December 31, 2021 | $ | ||||||||||
Granted | |||||||||||
Vested and converted to common stock | ( | ||||||||||
Forfeited | ( | ||||||||||
Outstanding on March 31, 2022 | $ |
Number of Performance Stock Units | Weighted- Average Grant-Date Fair Value | ||||||||||
Outstanding on December 31, 2021 | $ | ||||||||||
Granted | |||||||||||
Vested and converted to common stock | ( | ||||||||||
Forfeited | |||||||||||
Outstanding on March 31, 2022 | $ |
Number of Phantom Stock Units | |||||
Outstanding on December 31, 2021 | |||||
Granted | |||||
Vested | |||||
Forfeited | |||||
Outstanding on March 31, 2022 |
Executive Search | |||||||||||||||||||||||||||||||||||
Americas | Europe | Asia Pacific | Heidrick Consulting | Global Operations Support | Total | ||||||||||||||||||||||||||||||
Employee related | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||
Office related | |||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | ( | $ | $ | $ |
Executive Search | |||||||||||||||||||||||||||||||||||
Americas | Europe | Asia Pacific | Heidrick Consulting | Global Operations Support | Total | ||||||||||||||||||||||||||||||
Employee related | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Office related | |||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
Employee Related | Office Related | Other | Total | |||||||||||||||||||||||
Accrual balance at December 31, 2021 | ||||||||||||||||||||||||||
Cash payments | ( | ( | ||||||||||||||||||||||||
Non-cash write-offs | ( | ( | ||||||||||||||||||||||||
Exchange rate fluctuations | ( | ( | ||||||||||||||||||||||||
Accrual balance at March 31, 2022 | $ | $ | $ | $ |
Foreign Currency Translation | Pension | AOCI | ||||||||||||||||||
Balance at December 31, 2021 | $ | $ | ( | $ | ||||||||||||||||
Other comprehensive loss before classification, net of tax | ( | — | ( | |||||||||||||||||
Balance at March 31, 2022 | $ | $ | ( | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Revenue | |||||||||||
Executive Search | |||||||||||
Americas | $ | $ | |||||||||
Europe | |||||||||||
Asia Pacific | |||||||||||
Total Executive Search | |||||||||||
On-Demand Talent | — | ||||||||||
Heidrick Consulting | |||||||||||
Revenue before reimbursements (net revenue) | |||||||||||
Reimbursements | |||||||||||
Total revenue | $ | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Operating income | |||||||||||
Executive Search | |||||||||||
Americas (1) | $ | $ | |||||||||
Europe (2) | |||||||||||
Asia Pacific (3) | |||||||||||
Total Executive Search | |||||||||||
On-Demand Talent | ( | — | |||||||||
Heidrick Consulting (4) | ( | ( | |||||||||
Total segment operating income | |||||||||||
Research and Development | ( | ||||||||||
Global Operations Support (5) | ( | ( | |||||||||
Total operating income | $ | $ |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Revenue | |||||||||||
Revenue before reimbursements (net revenue) | 100.0 | % | 100.0 | % | |||||||
Reimbursements | 0.6 | 0.6 | |||||||||
Total revenue | 100.6 | 100.6 | |||||||||
Operating expenses | |||||||||||
Salaries and benefits | 71.0 | 73.0 | |||||||||
General and administrative expenses | 10.5 | 14.1 | |||||||||
Cost of services | 6.3 | 0.8 | |||||||||
Research and development | 1.6 | — | |||||||||
Restructuring charges | — | 2.0 | |||||||||
Reimbursed expenses | 0.6 | 0.6 | |||||||||
Total operating expenses | 89.9 | 90.4 | |||||||||
Operating income | 10.7 | 10.1 | |||||||||
Non-operating income (expense) | |||||||||||
Interest, net | — | — | |||||||||
Other, net | (0.9) | 1.6 | |||||||||
Net non-operating income | (0.8) | 1.6 | |||||||||
Income before income taxes | 9.8 | 11.8 | |||||||||
Provision for income taxes | 3.3 | 4.1 | |||||||||
Net income | 6.5 | % | 7.7 | % |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Revenue | |||||||||||
Executive Search | |||||||||||
Americas | $ | 162,553 | $ | 116,506 | |||||||
Europe | 49,745 | 37,643 | |||||||||
Asia Pacific | 30,251 | 25,469 | |||||||||
Total Executive Search | 242,549 | 179,618 | |||||||||
On-Demand Talent | 23,381 | — | |||||||||
Heidrick Consulting | 17,931 | 14,038 | |||||||||
Revenue before reimbursements (net revenue) | 283,861 | 193,656 | |||||||||
Reimbursements | 1,676 | 1,075 | |||||||||
Total revenue | $ | 285,537 | $ | 194,731 |
Three Months Ended March 31, | |||||||||||
2022 | 2021 | ||||||||||
Operating income | |||||||||||
Executive Search | |||||||||||
Americas (1) | $ | 39,851 | $ | 26,256 | |||||||
Europe (2) | 5,403 | 4,540 | |||||||||
Asia Pacific (3) | 5,054 | 4,144 | |||||||||
Total Executive Search | 50,308 | 34,940 | |||||||||
On-Demand Talent | (582) | — | |||||||||
Heidrick Consulting (4) | (2,084) | (4,710) | |||||||||
Total segment operating income | 47,642 | 30,230 | |||||||||
Research and Development | ( | ||||||||||
Global Operations Support (5) | (13,008) | (10,622) | |||||||||
Total operating income | $ | 30,232 | $ | 19,608 |
Incorporated by Reference | ||||||||||||||||||||||||||
Exhibit No. | Exhibit Description | Form | Exhibit | Filing Date/Period End Date | ||||||||||||||||||||||
*10.1 | ||||||||||||||||||||||||||
10.2 | 8-K | 10.1 | April 15, 2022 | |||||||||||||||||||||||
*31.1 | ||||||||||||||||||||||||||
*31.2 | ||||||||||||||||||||||||||
*32.1 | ||||||||||||||||||||||||||
*32.2 | ||||||||||||||||||||||||||
*101.INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data Files because its XBRL tags are embedded within the Inline XBRL document | |||||||||||||||||||||||||
*101.SCH | Inline XBRL Taxonomy Extension Schema Document | |||||||||||||||||||||||||
*101.CAL | Inline XBRL Taxonomy Calculation Linkbase Document | |||||||||||||||||||||||||
*101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||||||||||||||||||||
*101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||||||||||||||||||||
*101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||||||||||||||||||||
*104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* | Filed herewith. | ||||
** | Denotes a management contract or compensatory plan or arrangement. |
Heidrick & Struggles International, Inc. | |||||
(Registrant) | |||||
/s/ Stephen A. Bondi | |||||
Stephen A. Bondi | |||||
Vice President, Controller (On behalf of the registrant and in his capacity as Chief Accounting Officer) |
Dated: | April 25, 2022 | /s/ Krishnan Rajagopalan | |||||||||
Krishnan Rajagopalan | |||||||||||
President and Chief Executive Officer |
Dated: | April 25, 2022 | /s/ Mark R. Harris | |||||||||
Mark R. Harris | |||||||||||
Executive Vice President and Chief Financial Officer |
Dated: | April 25, 2022 | /s/ Krishnan Rajagopalan | |||||||||
Krishnan Rajagopalan | |||||||||||
President and Chief Executive Officer |
Dated: | April 25, 2022 | /s/ Mark R. Harris | |||||||||
Mark R. Harris | |||||||||||
Executive Vice President and Chief Financial Officer |
Statement of Financial Position, Classified (Details) - USD ($) |
Mar. 31, 2022 |
Dec. 31, 2021 |
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Statement of Financial Position [Abstract] | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Common Stock, Shares Authorized | 100,000,000 | |
Common Stock, Par or Stated Value Per Share | $ 0.01 | |
Common Stock, Shares, Outstanding | 19,717,804 | 19,591,527 |
Treasury Stock, Shares | 5,080 | |
Accounts Receivable, Allowance for Credit Loss, Current | $ 6,278,000 | $ 5,666,000 |
Common Stock, Shares, Issued | 19,722,884 | 19,596,607 |
Organization, Consolidation and Presentation of Financial Statements |
3 Months Ended |
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Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure | The accompanying unaudited Condensed Consolidated Financial Statements of Heidrick & Struggles International, Inc. and subsidiaries (the "Company") have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Significant items subject to estimates and assumptions include revenue recognition, income taxes, interim effective tax rate and the assessment of goodwill, other intangible assets and long-lived assets for impairment. Estimates are subject to a degree of uncertainty and actual results could differ from these estimates. In the opinion of management, all adjustments necessary to fairly present the financial position of the Company at March 31, 2022 and December 31, 2021, the results of operations for the three months ended March 31, 2022 and 2021 and its cash flows for the three months ended March 31, 2022 and 2021 have been included and are of a normal, recurring nature except as otherwise disclosed. These financial statements and notes are to be read in conjunction with the Company’s Consolidated Financial Statements and Notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on February 28, 2022. |
Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation and Significant Accounting Policies | A complete listing of the Company’s significant accounting policies is discussed in Note 2, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Revenue Recognition See Note 3, Revenue. Cost of Services Cost of services consists of third-party contractor costs related to the delivery of various services in the Company's On-Demand Talent and Heidrick Consulting operating segments. Research and development Research and development consists of payroll, employee benefits, stock-based compensation, other employee expenses and third-party professional fees associated with new product development. Marketable Securities The Company’s marketable securities consist of available-for-sale debt securities with original maturities exceeding three months. Restricted Cash The following table provides a reconciliation of the cash and cash equivalents between the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Cash Flows as of March 31, 2022 and 2021, and December 31, 2021 and 2020:
Earnings per Common Share Basic earnings per common share is computed by dividing net income by weighted average common shares outstanding for the period. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted. Common equivalent shares are excluded from the determination of diluted earnings per share in periods in which they have an anti-dilutive effect. The following table sets forth the computation of basic and diluted earnings per share:
Reclassifications Certain prior year amounts have been recast as a result of the Company's presentation of Cost of services in the Condensed Consolidated Statements of Comprehensive Income. The reclassifications had no impact on net income, net cash flows or stockholders' equity. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in Operating Lease Right-of-Use Assets, Operating Lease Liabilities - Current and Operating Lease Liabilities - Non-Current in our Condensed Consolidated Balance Sheets. The Company does not have any leases that meet the finance lease criteria. Right-of-use assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized on the commencement date based on the present value of lease payments over the lease term. As most of the Company's leases do not provide an implicit rate, an incremental borrowing rate based on the information available at the commencement date is used in determining the present value of lease payments. The operating lease right-of-use asset also includes any lease payments made in advance and any accrued rent expense balances. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. For office leases, the Company accounts for the lease and non-lease components as a single lease component. For equipment leases, such as vehicles and office equipment, the Company accounts for the lease and non-lease components separately. Recently Issued Financial Accounting Standards In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The guidance is intended to provide temporary optional expedients and exceptions to the guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. This guidance is effective March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating the impact of this accounting guidance. The effect is not known or reasonably estimable at this time.
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Reclassifications | Reclassifications Certain prior year amounts have been recast as a result of the Company's presentation of Cost of services in the Condensed Consolidated Statements of Comprehensive Income. The reclassifications had no impact on net income, net cash flows or stockholders' equity.
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Revenue from Contract with Customer |
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Revenue from Contract with Customer | Executive Search Revenue is recognized as performance obligations are satisfied by transferring a good or service to a client. Generally, each executive search contract contains one performance obligation which is the process of identifying potentially qualified candidates for a specific client position. In most contracts, the transaction price includes both fixed and variable consideration. Fixed compensation is comprised of a retainer, equal to approximately one-third of the estimated first year compensation for the position to be filled, and indirect expenses, equal to a specified percentage of the retainer, as defined in the contract. The Company generally bills clients for the retainer and indirect expenses in one-third increments over a three-month period commencing in the month of a client’s acceptance of the contract. If actual compensation of a placed candidate exceeds the original compensation estimate, the Company is often authorized to bill the client for one-third of the excess compensation. The Company refers to this additional billing as uptick revenue. In most contracts, variable consideration is comprised of uptick revenue and direct expenses. The Company bills its clients for uptick revenue upon completion of the executive search, and direct expenses are billed as incurred. The Company estimates uptick revenue at contract inception, based on a portfolio approach, utilizing the expected value method based on a historical analysis of uptick revenue realized in the Company’s geographic regions and industry practices, and initially records a contract’s uptick revenue in an amount that is probable not to result in a significant reversal of cumulative revenue recognized when the actual amount of uptick revenue for the contract is known. Differences between the estimated and actual amounts of variable consideration are recorded when known. The Company does not estimate revenue for direct expenses as it is not materially different than recognizing revenue as direct expenses are incurred. Revenue from executive search engagement performance obligations is recognized over time as clients simultaneously receive and consume the benefits provided by the Company's performance. Revenue from executive search engagements is recognized over the expected average period of performance, in proportion to the estimated personnel time incurred to fulfill the obligations under the executive search contract. Revenue is generally recognized over a period of approximately six months. The Company's executive search contracts contain a replacement guarantee which provides for an additional search to be completed, free of charge except for expense reimbursements, should the candidate presented by the Company be hired by the client and subsequently terminated by the client for performance reasons within a specified period of time. The replacement guarantee is an assurance warranty, which is not a performance obligation under the terms of the executive search contract, as the Company does not provide any services under the terms of the guarantee that transfer benefits to the client in excess of assuring that the identified candidate complies with the agreed-upon specifications. The Company accounts for the replacement guarantee under the relevant warranty guidance in Accounting Standards Codification 460 - Guarantees. On-Demand Talent The Company enters into contracts with clients that outline the general terms and conditions of the assignment to provide on-demand consultants for various types of consulting projects, which consultants may be independent contractors or temporary employees. The consideration the Company expects to receive under each contract is dependent on the time-based fees specified in the contract. Revenue from on-demand engagement performance obligations is recognized over time as clients simultaneously receive and consume the benefits provided by the Company's performance. The Company has applied the practical expedient to recognize revenue for these services in the amount to which the Company has a right to invoice the client, as this amount corresponds directly with the value provided to the client for the performance completed to date. For transactions where a third-party contractor is involved in providing the services to the client, the Company reports the revenue and the related direct costs on a gross basis as it has determined that it is the principal in the transaction. The Company is primarily responsible for fulfilling the promise to provide consulting services to its clients and the Company has discretion in establishing the prices charged to clients for the consulting services and is able to contractually obligate the independent service provider to deliver services and deliverables that the Company has agreed to provide to its clients. Heidrick Consulting Revenue is recognized as performance obligations are satisfied by transferring a good or service to a client. Heidrick Consulting enters into contracts with clients that outline the general terms and conditions of the assignment to provide succession planning, executive assessment, top team and board effectiveness and culture shaping programs. The consideration the Company expects to receive under each contract is generally fixed. Most of the Company's consulting contracts contain one performance obligation, which is the overall process of providing the consulting service requested by the client. The majority of our consulting revenue is recognized over time utilizing both input and output methods. Contracts that contain coaching sessions, training sessions or the completion of assessments are recognized using the output method as each session or assessment is delivered to the client. Contracts that contain general consulting work are recognized using the input method utilizing a measure of progress that is based on time incurred on the project. The Company enters into enterprise agreements with clients to provide a license for online access, via the Company's Culture Connect platform, to training and other proprietary material related to the Company's culture shaping programs. The consideration the Company expects to receive under the terms of an enterprise agreement is comprised of a single fixed fee. The enterprise agreements contain multiple performance obligations, the delivery of materials via Culture Connect and material rights related to options to renew enterprise agreements at a significant discount. The Company allocates the transaction price to the performance obligations in the contract on a stand-alone selling price basis. The stand-alone selling price for the initial term of the enterprise agreement is outlined in the contract and is equal to the price paid by the client for the agreement over the initial term of the contract. The stand-alone selling price for the options to renew, or material right, are not directly observable and must be estimated. This estimate is required to reflect the discount the client would obtain when exercising the option to renew, adjusted for the likelihood that the option will be exercised. The Company estimates the likelihood of renewal using a historical analysis of client renewals. Access to Culture Connect represents a right to access the Company’s intellectual property that the client simultaneously receives and consumes as the Company performs under the agreement, and therefore the Company recognizes revenue over time. Given the continuous nature of this commitment, the Company utilizes straight-line ratable revenue recognition over the estimated subscription period as the Company's clients will receive and consume the benefits from Culture Connect equally throughout the contract period. Revenue related to client renewals of enterprise agreements is recognized over the term of the renewal, which is generally twelve months. Enterprise agreements do not comprise a significant portion of the Company's revenue. Contract Balances Contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. Contract assets and liabilities are classified as current due to the nature of the Company's contracts, which are completed within one year. Contract assets are included within Other Current Assets on the Condensed Consolidated Balance Sheets. Unbilled receivables: Unbilled revenue represents contract assets from revenue recognized over time in excess of the amount billed to the client and the amount billed to the client is solely dependent upon the passage of time. This amount includes revenue recognized in excess of billed executive search retainers, Heidrick Consulting fees, and On-Demand Talent fees. Contract assets: Contract assets represent revenue recognized over time in excess of the amount billed to the client and the amount billed to the client is not solely subject to the passage of time. This amount primarily includes revenue recognized for upticks and contingent placement fees in executive search contracts. Deferred revenue: Contract liabilities consist of deferred revenue, which is equal to billings in excess of revenue recognized. The following table outlines the changes in the contract asset and liability balances from December 31, 2021 to March 31, 2022:
During the three months ended March 31, 2022, the Company recognized revenue of $51.1 million that was included in the contract liabilities balance at the beginning of the period. The amount of revenue recognized during the three months ended March 31, 2022, from performance obligations partially satisfied in previous periods as a result of changes in the estimates of variable consideration was $8.3 million. Each of the Company's contracts has an expected duration of one year or less. Accordingly, the Company has elected to utilize the available practical expedient related to the disclosure of the transaction price allocated to the remaining performance obligations under its contracts. The Company has also elected the available practical expedients related to adjusting for the effects of a significant financing component and the capitalization of contract acquisition costs. The Company charges and collects from its clients sales tax and value added taxes as required by certain jurisdictions. The Company has made an accounting policy election to exclude these items from the transaction price in its contracts.
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Credit Losses |
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Loans, Notes, Trade and Other Receivables Disclosure | The Company is exposed to credit losses primarily through the provision of its executive search, consulting, and on-demand talent services. The Company’s expected credit loss allowance methodology for accounts receivable is developed using historical collection experience, current and future economic and market conditions and a review of the current status of clients' trade accounts receivables. Due to the short-term nature of such receivables, the estimate of amount of accounts receivable that may not be collected is primarily based on historical loss-rate experience. When required, the Company adjusts the loss-rate methodology to account for current conditions and reasonable and supportable expectations of future economic and market conditions. The Company generally assesses future economic conditions for a period of sixty to ninety days, which corresponds with the contractual life of its accounts receivables. Additionally, specific allowance amounts are established to record the appropriate provision for clients that have a higher probability of default. The Company’s monitoring activities include timely account reconciliation, dispute resolution, payment confirmation, consideration of clients' financial condition and macroeconomic conditions. Balances are written off when determined to be uncollectible. The Company considered the current and expected future economic and market conditions surrounding the COVID-19 pandemic and determined that the estimate of credit losses was not significantly impacted. The activity in the allowance for credit losses on the Company's trade receivables is as follows:
The fair value and unrealized losses on available for sale debt securities, aggregated by investment category and the length of time the security has been in an unrealized loss position, are as follows:
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Property, Plant, and Equipment |
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Property, Plant and Equipment Disclosure | The components of the Company’s property and equipment are as follows:
Depreciation expense for each of the three months ended March 31, 2022 and 2021 was $1.8 million.
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Leases, Codification Topic 842 |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lessee, Operating Leases | The Company's lease portfolio is comprised of operating leases for office space and equipment. The majority of the Company's leases include both lease and non-lease components, which the Company accounts for differently depending on the underlying class of asset. Certain of the Company's leases include one or more options to renew or terminate the lease at the Company's discretion. Generally, the renewal and termination options are not included in the right-of-use assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal and termination options and when they are reasonably certain of exercise, includes the renewal or termination option in the lease term. As most of the Company's leases do not provide an implicit interest rate, the Company utilizes an incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company has a centrally managed treasury function and therefore, a portfolio approach is applied in determining the incremental borrowing rate. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a fully collateralized basis over a similar term in an amount equal to the total lease payments in a similar economic environment. Office leases have remaining lease terms that range from less than one year to 11.3 years, some of which also include options to extend or terminate the lease. Most office leases contain both fixed and variable lease payments. Variable lease costs consist primarily of rent escalations based on an established index or rate and taxes, insurance, and common area or other maintenance costs, which are paid based on actual costs incurred by the lessor. The Company has elected to utilize the available practical expedient to not separate lease and non-lease components for office leases. As part of the Company's restructuring plan, a lease component related to one of the Company's offices was abandoned and the useful life of the associated right-of-use asset was shortened to correspond with the cease-use date. As a result of the change in the useful life, approximately $4.0 million of right-of-use asset amortization was accelerated and recorded in Restructuring charges in the Condensed Consolidated Statements of Comprehensive Income and Depreciation and amortization in the Condensed Consolidated Statements of Cash Flows during the three months ended March 31, 2021. Equipment leases, which are comprised of vehicle and office equipment leases, have remaining terms that range from less than one year to 4.7 years, some of which also include options to extend or terminate the lease. The Company's equipment leases do not contain variable lease payments. The Company separates the lease and non-lease components for its equipment leases. Equipment leases do not comprise a significant portion of the Company's lease portfolio. Lease cost components included within General and Administrative Expenses in our Condensed Consolidated Statements of Comprehensive Income were as follows:
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Fair Value Measures and Disclosures |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment | Cash, Cash Equivalents and Marketable Securities The Company's investments in marketable debt securities, which consist of U.S. Treasury bills, are classified and accounted for as available-for-sale. The Company classifies its marketable debt securities as either short-term or long-term based on each instrument's underlying contractual maturity date. Unrealized gains and losses on marketable debt securities classified as available-for-sale are recognized in Accumulated other comprehensive income in the Condensed Consolidated Balance Sheets until realized. The Company's cash, cash equivalents, and marketable securities by significant investment category are as follows:
(1)Level 1 – Quoted prices in active markets for identical assets and liabilities. Investments, Assets Designated for Retirement and Pension Plans and Associated Liabilities The Company has a U.S. non-qualified deferred compensation plan that consists primarily of U.S. marketable securities and mutual funds. The aggregate cost basis for these investments was $27.5 million and $22.9 million as of March 31, 2022 and December 31, 2021, respectively. The Company also maintains a pension plan for certain current and former employees in Germany. The pensions are individually fixed Euro amounts that vary depending on the function and the eligible years of service of the employee. The Company’s investment strategy is to support its pension obligations through reinsurance contracts. The BaFin—German Federal Financial Supervisory Authority—supervises the insurance companies and the reinsurance contracts. The BaFin requires each reinsurance contract to guarantee a fixed minimum return. The Company’s pension benefits are fully reinsured by group insurance contracts with ERGO Lebensversicherung AG, and the group insurance contracts are measured in accordance with BaFin guidelines (including mortality tables and discount rates) which are considered Level 2 inputs. The following tables provide a summary of the fair value measurements for each major category of investments, assets designated for retirement and pension plans and associated liabilities measured at fair value:
(1)Level 1 – Quoted prices in active markets for identical assets and liabilities. (2)Level 2 – Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Contingent Consideration and Compensation The former owners of the Company's acquired businesses are eligible to receive additional cash compensation based on the attainment of certain operating metrics in the periods subsequent to acquisition. Contingent consideration and compensation are valued using significant inputs that are not observable in the market, which are defined as Level 3 inputs pursuant to fair value measurement accounting. The Company determines the fair value of contingent consideration and compensation using discounted cash flow models. The following table provides a reconciliation of the beginning and ending balance of Level 3 liabilities for the three months ended March 31, 2022:
Earnout accruals of $26.9 million and zero were recorded within Other current liabilities as of March 31, 2022 and December 31, 2021, respectively, and earnout accruals of $9.0 million and $35.7 million were recorded within Other non-current liabilities as of March 31, 2022 and December 31, 2021, respectively. The contingent compensation accruals are recorded within non-current Accrued salaries and benefits at both March 31, 2022 and December 31, 2021.
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Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure | Goodwill The Company's goodwill by segment is as follows:
Changes in the carrying amount of goodwill by segment for the three months ended March 31, 2022, are as follows:
Other Intangible Assets, net The Company’s other intangible assets, net by segment, are as follows:
The carrying amount of amortizable intangible assets and the related accumulated amortization are as follows:
Intangible asset amortization expense for the three months ended March 31, 2022 and 2021 was $0.8 million and $0.2 million, respectively. The Company's estimated future amortization expense related to intangible assets as of March 31, 2022, for the years ended December 31 is as follows:
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Deferred Costs, Capitalized, Prepaid, and Other Assets |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Additional Financial Information Disclosure | The components of other current assets are as follows:
The components of other current liabilities are as follows:
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Debt |
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Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt Disclosure | On July 13, 2021, the Company entered into a First Amendment to the 2018 Credit Agreement (the "Amendment"). The Amendment provides the Company with a committed unsecured revolving credit facility in an aggregate amount of $200 million, increased from $175 million as set forth in the 2018 Credit Agreement, which includes a sublimit of $25 million for letters of credit and a sublimit of $10 million for swingline loans, with a $75 million expansion feature. The Amendment matures on July 13, 2026, extended from October 26, 2023 as set forth in the 2018 Credit Agreement. Borrowings under the Amendment may be used for working capital, capital expenditures, permitted acquisitions, restricted payments and for other general corporate purposes of the Company and its subsidiaries. The obligations under the Amendment are guaranteed by certain of the Company’s subsidiaries. As of March 31, 2022 and December 31, 2021, the Company had no outstanding borrowings. The Company was in compliance with the financial and other covenants under the Amendment and no event of default existed.
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Compensation Related Costs, Share Based Payments |
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Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement | The Company's Third Amended and Restated 2012 Heidrick & Struggles GlobalShare Program (the "Third A&R Program") provides for grants of stock options, stock appreciation rights, and other stock-based compensation awards that are valued based upon the grant date fair value of shares. These awards may be granted to directors, selected employees and independent contractors. As of March 31, 2022, 3,650,461 awards have been issued under the Third A&R Program, including 748,407 forfeited awards, and 447,946 shares remain available for future awards. The Third A&R Program provides that no awards can be granted after May 28, 2028. The Company measures its stock-based compensation costs based on the grant date fair value of the awards and recognizes these costs over the requisite service period. A summary of information with respect to stock-based compensation is as follows:
(1) Includes $0.8 million of income and $2.5 million of expense related to cash settled restricted stock units for the three months ended March 31, 2022 and 2021, respectively. Restricted Stock Units Restricted stock units are subject to ratable vesting over a -year or -year period dependent upon the terms of the individual grant. Compensation expense related to service-based restricted stock units is recognized on a straight-line basis over the vesting period. Restricted stock unit activity for the three months ended March 31, 2022 is as follows:
As of March 31, 2022, there was $12.3 million of pre-tax unrecognized compensation expense related to unvested restricted stock units, which is expected to be recognized over a weighted average of 2.6 years. Performance Stock Units The Company grants performance stock units to certain of its senior executives. The performance stock units are generally subject to a cliff vesting at the end of a -year period. The vesting will vary between 0% and 200% based on the attainment of certain performance and market conditions over the -year vesting period. Half of the award is based on the achievement of operating margin thresholds and half of the award is based on the Company's total shareholder return, relative to a peer group. The fair value of the awards subject to total shareholder return metrics is determined using the Monte-Carlo simulation model. A Monte Carlo simulation model uses stock price volatility and other variables to estimate the probability of satisfying the performance conditions and the resulting fair value of the award. The performance stock units are expensed on a straight-line basis over the -year vesting period. Performance stock unit activity for the three months ended March 31, 2022 is as follows:
As of March 31, 2022, there was $7.5 million of pre-tax unrecognized compensation expense related to unvested performance stock units, which is expected to be recognized over a weighted average of 2.1 years. Phantom Stock Units Phantom stock units are grants of phantom stock with respect to shares of the Company's common stock that are settled in cash and are subject to various restrictions, including restrictions on transferability, vesting and forfeiture provisions. Shares of phantom stock that do not vest for any reason will be forfeited by the recipient and will revert to the Company. Phantom stock units are subject to vesting over a period of years and certain other conditions, including continued service to the Company. As a result of the cash-settlement feature of the awards, the Company classifies the awards as liability awards, which are measured at fair value at each reporting date and the vested portion of the award is recognized as a liability to the extent that the service condition is deemed probable. The fair value of the phantom stock awards on the balance sheet date is determined using the closing share price of the Company's common stock on that date. The Company recorded phantom stock-based compensation income of $0.8 million and expense of $2.5 million during the three months ended March 31, 2022 and 2021, respectively. Phantom stock unit activity for the three months ended March 31, 2022 is as follows:
As of March 31, 2022, there was $3.1 million of pre-tax unrecognized compensation expense related to unvested phantom stock units, which is expected to be recognized over a weighted average of 2.5 years.
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Restructuring and Related Activities |
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Restructuring and Related Activities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities Disclosure | During the year ended December 31, 2020, the Company implemented a restructuring plan (the "2020 Plan") to optimize future growth and profitability. The primary components of the 2020 Plan included a workforce reduction, a reduction of the Company's real estate expenses and professional fees, and the elimination of certain deferred compensation programs. The Company continued to incur charges related to the 2020 Plan during the year ended December 31, 2021, which primarily related to finalizing a reduction of the Company's real estate footprint. The Company did not incur any charges during the three months ended March 31, 2022 and does not anticipate incurring any future charges under the 2020 Plan. Restructuring charges (reversals) for the three months ended March 31, 2021 by type of charge (reversal) and operating segment are as follows:
Restructuring charges incurred to date under the 2020 Plan, which are solely comprised of prior period charges, by type of charge and reportable segment are as follows:
As part of the Company's reduction in real estate expenses under the 2020 Plan, a lease component related to one of the Company's offices was abandoned. In September 2021, the Company entered into a termination and surrender agreement for this lease component. Under the terms of the agreement, the Company made a one-time payment of $11.7 million to release the Company from all remaining obligations under the lease. At the time of payment, the Company had accrued approximately $17.4 million of lease liabilities related to future payments under the remaining lease term. Upon making the one-time payment, the lease liabilities were relieved, resulting in a gain on termination of approximately $5.7 million, which is recorded in Restructuring charges in the Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2021. Changes in the restructuring accrual for the three months ended March 31, 2022 were as follows:
Restructuring accruals are recorded within current Accrued salaries and benefits as of March 31, 2022.
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Income Taxes |
3 Months Ended |
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Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure | The Company reported income before taxes of $27.9 million and an income tax provision of $9.4 million for the three months ended March 31, 2022. The Company reported income before taxes of $22.8 million and an income tax provision of $7.9 million for the three months ended March 31, 2021. The effective tax rates for the three months ended March 31, 2022 and 2021, were 33.7% and 34.9%, respectively. The effective tax rates for the three months ended March 31, 2022 and 2021 were each impacted by one-time items and the mix of income. |
Comprehensive Text Block List |
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Mar. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Comprehensive Income (Loss) Note | The changes in Accumulated other comprehensive income (“AOCI”) by component for the three months ended March 31, 2022 are as follows:
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Segment Reporting |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Disclosure | The Company has five operating segments. The executive search business operates in the Americas, Europe (which includes Africa) and Asia Pacific (which includes the Middle East), and the Heidrick Consulting and On-Demand Talent businesses operate globally. For segment purposes, reimbursements of out-of-pocket expenses classified as revenue and other operating income are reported separately and, therefore, are not included in the results of each segment. The Company believes that analyzing trends in revenue before reimbursements (net revenue), analyzing operating expenses as a percentage of net revenue, and analyzing operating income, more appropriately reflect its core operations. Revenue and operating income by segment are as follows:
(1) Includes restructuring charges of $3.7 million for the three months ended March 31, 2021. (2) Includes restructuring reversals of $0.1 million for the three months ended March 31, 2021. (3) Includes restructuring reversals of $0.1 million for the three months ended March 31, 2021. (4) Includes restructuring charges of $0.3 million for the three months ended March 31, 2021. (5) Includes restructuring charges of less than $0.1 million for the three months ended March 31, 2021.
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Guarantees |
3 Months Ended |
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Mar. 31, 2022 | |
Guarantees and Product Warranties [Abstract] | |
Guarantees | The Company has utilized letters of credit to support certain obligations, primarily for its office lease agreements. The letters of credit were made to secure the respective agreements and are for the terms of the agreements, which extend through 2033. For each letter of credit issued, the Company would have to use cash to fulfill the obligation if there is a default on a payment. The maximum amount of undiscounted payments the Company would be required to make in the event of default on all outstanding letters of credit is approximately $4.4 million as of March 31, 2022. The Company has not accrued for these arrangements as no event of default exists or is expected to exist. |
Commitment and Contingencies |
3 Months Ended |
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Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure | Litigation The Company has contingent liabilities from various pending claims and litigation matters arising in the ordinary course of the Company’s business, some of which involve claims for damages that are substantial in amount. Some of these matters are covered by insurance. Based upon information currently available, the Company believes the ultimate resolution of such claims and litigation will not have a material adverse effect on its financial condition, results of operations or liquidity.
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Subsequent Events |
3 Months Ended |
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Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | . Subsequent Event Open for potential subsequent events |
Business Combinations |
3 Months Ended |
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Mar. 31, 2022 | |
Business Combinations [Abstract] | |
Business Combination Disclosure |
Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost of Goods and Service | Cost of Services Cost of services consists of third-party contractor costs related to the delivery of various services in the Company's On-Demand Talent and Heidrick Consulting operating segments.
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Revenue from Contract with Customer | Revenue Recognition See Note 3, Revenue.
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Research and Development Expense, Policy | Research and developmentResearch and development consists of payroll, employee benefits, stock-based compensation, other employee expenses and third-party professional fees associated with new product development. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share, Policy | Earnings per Common Share Basic earnings per common share is computed by dividing net income by weighted average common shares outstanding for the period. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted. Common equivalent shares are excluded from the determination of diluted earnings per share in periods in which they have an anti-dilutive effect. The following table sets forth the computation of basic and diluted earnings per share:
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Lessee, Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in Operating Lease Right-of-Use Assets, Operating Lease Liabilities - Current and Operating Lease Liabilities - Non-Current in our Condensed Consolidated Balance Sheets. The Company does not have any leases that meet the finance lease criteria. Right-of-use assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized on the commencement date based on the present value of lease payments over the lease term. As most of the Company's leases do not provide an implicit rate, an incremental borrowing rate based on the information available at the commencement date is used in determining the present value of lease payments. The operating lease right-of-use asset also includes any lease payments made in advance and any accrued rent expense balances. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. For office leases, the Company accounts for the lease and non-lease components as a single lease component. For equipment leases, such as vehicles and office equipment, the Company accounts for the lease and non-lease components separately.
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New Accounting Pronouncements, Policy | Recently Issued Financial Accounting Standards In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The guidance is intended to provide temporary optional expedients and exceptions to the guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. This guidance is effective March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating the impact of this accounting guidance. The effect is not known or reasonably estimable at this time.
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Marketable Securities, Policy | Marketable Securities The Company’s marketable securities consist of available-for-sale debt securities with original maturities exceeding three months.
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Accounting Policies (Tables) |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of the cash and cash equivalents between the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Cash Flows as of March 31, 2022 and 2021, and December 31, 2021 and 2020:
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Restrictions on Cash and Cash Equivalents | The following table provides a reconciliation of the cash and cash equivalents between the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Cash Flows as of March 31, 2022 and 2021, and December 31, 2021 and 2020:
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Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted earnings per share:
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Revenue from Contract with Customer (Tables) |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contract with Customer, Contract Asset, Contract Liability, and Receivable | The following table outlines the changes in the contract asset and liability balances from December 31, 2021 to March 31, 2022:
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Credit Losses (Tables) |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Credit Loss [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable, Allowance for Credit Loss | The activity in the allowance for credit losses on the Company's trade receivables is as follows:
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Debt Securities, Available-for-sale | The fair value and unrealized losses on available for sale debt securities, aggregated by investment category and the length of time the security has been in an unrealized loss position, are as follows:
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Property, Plant, and Equipment (Tables) |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment | The components of the Company’s property and equipment are as follows:
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Leases, Codification Topic 842 (Tables) |
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease, Cost | Lease cost components included within General and Administrative Expenses in our Condensed Consolidated Statements of Comprehensive Income were as follows:
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Schedule of Cash Flow Information Related to Operating Leases | Supplemental cash flow information related to the Company's operating leases is as follows for the three months ended March 31:
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Lessee Operating Lease Weighted Averages | The weighted average remaining lease term and weighted average discount rate for operating leases as of March 31, are as follows:
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Lessee, Operating Lease, Liability, Maturity | The future maturities of the Company's operating lease liabilities as of March 31, 2022, for the years ended December 31 are as follows:
|
Fair Value Measures and Disclosures (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized Gain (Loss) on Investments | The Company's cash, cash equivalents, and marketable securities by significant investment category are as follows:
(1)Level 1 – Quoted prices in active markets for identical assets and liabilities.
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Fair Value, Separate Account Investment | The following tables provide a summary of the fair value measurements for each major category of investments, assets designated for retirement and pension plans and associated liabilities measured at fair value:
(1)Level 1 – Quoted prices in active markets for identical assets and liabilities. (2)Level 2 – Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
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Investments and Other Noncurrent Assets | The following table provides a reconciliation of the beginning and ending balance of Level 3 liabilities for the three months ended March 31, 2022:
Earnout accruals of $26.9 million and zero were recorded within Other current liabilities as of March 31, 2022 and December 31, 2021, respectively, and earnout accruals of $9.0 million and $35.7 million were recorded within Other non-current liabilities as of March 31, 2022 and December 31, 2021, respectively. The contingent compensation accruals are recorded within non-current Accrued salaries and benefits at both March 31, 2022 and December 31, 2021.
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Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table provides a reconciliation of the beginning and ending balance of Level 3 liabilities for the three months ended March 31, 2022:
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Goodwill and Other Intangible Assets (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Intangible Assets and Goodwill | The Company's goodwill by segment is as follows:
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Schedule of Goodwill | Changes in the carrying amount of goodwill by segment for the three months ended March 31, 2022, are as follows:
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Schedule of Finite-Lived Intangible Assets | The Company’s other intangible assets, net by segment, are as follows:
The carrying amount of amortizable intangible assets and the related accumulated amortization are as follows:
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Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The Company's estimated future amortization expense related to intangible assets as of March 31, 2022, for the years ended December 31 is as follows:
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Deferred Costs, Capitalized, Prepaid, and Other Assets (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Current Assets | The components of other current assets are as follows:
The components of other current liabilities are as follows:
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Compensation Related Costs, Share Based Payments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount | A summary of information with respect to stock-based compensation is as follows:
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Share-based Payment Arrangement, Restricted Stock Unit, Activity | Restricted stock unit activity for the three months ended March 31, 2022 is as follows:
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Share-based Payment Arrangement, Performance Shares, Outstanding Activity |
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Share-Based Compensation, Phantom Shares Award Outstanding Activity | Phantom stock unit activity for the three months ended March 31, 2022 is as follows:
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Comprehensive Text Block List (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Text Block [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The changes in Accumulated other comprehensive income (“AOCI”) by component for the three months ended March 31, 2022 are as follows:
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Segment Reporting (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | Revenue and operating income by segment are as follows:
(1) Includes restructuring charges of $3.7 million for the three months ended March 31, 2021. (2) Includes restructuring reversals of $0.1 million for the three months ended March 31, 2021. (3) Includes restructuring reversals of $0.1 million for the three months ended March 31, 2021. (4) Includes restructuring charges of $0.3 million for the three months ended March 31, 2021. (5) Includes restructuring charges of less than $0.1 million for the three months ended March 31, 2021.
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Revenue from Contract with Customer (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Dec. 31, 2021 |
|
Revenue from Contract with Customer [Abstract] | ||
Unbilled Contracts Receivable | $ 19,348,000 | $ 17,947,000 |
Contract with Customer, Asset, after Allowance for Credit Loss | 41,073,000 | 36,942,000 |
Deferred Revenue, Current | 55,364,000 | 51,404,000 |
Deferred Revenue, Revenue Recognized | 51,100,000 | |
Contract with Customer, Performance Obligation Satisfied in Previous Period | 8,300,000 | |
Increase (Decrease) in Unbilled Contracts Receivable | 1,401,000 | |
Contract with Customer, Asset, before Allowance for Credit Loss | 21,725,000 | $ 18,995,000 |
Increase (Decrease) In Contract With Customer, After Allowance For Credit Loss | 2,730,000 | |
Increase (Decrease) in Contract with Customer, Asset | 4,131,000 | |
Deferred Revenue, Period Increase (Decrease) | $ 3,960,000 |
Property, Plant, and Equipment (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Dec. 31, 2021 |
|
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 81,665,000 | $ 81,478,000 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (54,503,000) | (54,393,000) | |
Property, Plant and Equipment, Net | 27,162,000 | 27,085,000 | |
Depreciation | 1,800,000 | $ 1,800,000 | |
Leasehold Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 41,510,000 | 42,252,000 | |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 14,515,000 | 14,933,000 | |
Computer Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 25,640,000 | $ 24,293,000 |
Fair Value Measures and Disclosures Level 3 Liabilities (Details) - USD ($) |
3 Months Ended | 27 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Dec. 30, 2021 |
Dec. 31, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Goodwill, Beginning Balance | $ 138,524,000 | |||
Restructuring Charges | 0 | $ 3,861,000 | $ 56,164,000 | |
Goodwill, Ending Balance | 139,017,000 | |||
Fair Value, Inputs, Level 3 | Contingent Compensation | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Deferred Compensation Arrangement with Individual, Compensation Expense | (1,089,000) | |||
Acquisition Earnout Accruals | (5,990,000) | $ (4,141,000) | ||
Fair Value, Inputs, Level 3 | Acqusition Earnout Accruals | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Earnout Accretion Fair Value Disclosure | (271,000) | |||
Acquisition Earnout Accruals | $ (35,925,000) | $ (35,654,000) |
Fair Value Measures and Disclosures Level 3 (Details) - Fair Value, Inputs, Level 3 |
3 Months Ended |
---|---|
Mar. 31, 2022
USD ($)
| |
Acqusition Earnout Accruals | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Acquisition Earnout Accruals | $ (35,654,000) |
Earnout Accretion Fair Value Disclosure | (271,000) |
Acquisition Earnout Accruals | (35,925,000) |
Contingent Compensation | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Acquisition Earnout Accruals | (4,141,000) |
Fair Value Measurement With Unobservable Inputs, Recurring Basis Liability, Foreign Currency Translation | (760,000) |
Acquisition Earnout Accruals | $ (5,990,000) |
Deferred Costs, Capitalized, Prepaid, and Other Assets (Details) - USD ($) |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Unbilled Receivables, Current | $ 41,073,000 | $ 36,942,000 |
Other Assets, Miscellaneous, Current | 6,073,000 | 4,507,000 |
Other Assets, Current | 47,146,000 | 41,449,000 |
Document Information [Line Items] | ||
Other Sundry Liabilities | 27,033,000 | 24,554,000 |
Other Liabilities, Current | 53,982,000 | 24,554,000 |
Acqusition Earnout Accruals | Fair Value, Inputs, Level 3 | ||
Document Information [Line Items] | ||
Acquisition Earnout Accruals | (35,925,000) | (35,654,000) |
Acqusition Earnout Accruals | Fair Value, Inputs, Level 3 | Other Current Liabilities [Member] | ||
Document Information [Line Items] | ||
Acquisition Earnout Accruals | $ 26,949,000 | $ 0 |
Debt (Details) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2022 |
Dec. 31, 2021 |
Jul. 13, 2021 |
Oct. 26, 2018 |
|
Debt Disclosure [Abstract] | ||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 200,000,000 | $ 175,000,000 | ||
Long-term Line of Credit | $ 0 | $ 0 | ||
Sub Limit for Letters of Credit | 25,000,000 | |||
Line of Credit Facility Expansion Borrowing Capacity | 75,000,000 | |||
Swingline Loan Sub Limit | $ 10,000,000 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Income Tax Disclosure [Abstract] | ||
Effective Income Tax Rate Reconciliation, Percent | 33.70% | 34.90% |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | $ 27,871 | $ 22,772 |
Income Tax Expense (Benefit) | $ 9,404 | $ 7,940 |
Guarantees (Details) |
Mar. 31, 2022
USD ($)
|
---|---|
Guarantees and Product Warranties [Abstract] | |
Guarantor Obligations, Maximum Exposure, Undiscounted | $ 4,400,000 |
Subsequent Events (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022 |
Jul. 13, 2021 |
Oct. 26, 2018 |
|
Subsequent Event [Line Items] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 200,000,000 | $ 175,000,000 | |
Sub Limit for Letters of Credit | $ 25,000,000 | ||
Swingline Loan Sub Limit | 10,000,000 | ||
Line of Credit Facility Expansion Borrowing Capacity | $ 75,000,000 |
Business Combinations (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Business Combinations [Abstract] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 283,861,000 | $ 193,656,000 |
Operating Income (Loss) | 30,232,000 | 19,608,000 |
Business Acquisition [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 283,861,000 | 193,656,000 |
Operating Income (Loss) | $ 30,232,000 | $ 19,608,000 |
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