Ladies and gentlemen, thank you for standing by. And welcome to the Korn Ferry Fourth Quarter Fiscal Year 2015 Conference Call. At this time, all participants are in a listen only mode. Following their prepared remarks we will conduct a question-and-answer session. As a reminder, this conference call is being recorded for replay purposes. We have also made available on the investor relations section of our website at www.kornferry.com a copy of the financial presentation that we will be reviewing with you today. Before I turn the call over to your host, Mr. Gary Burnison, let me first read a cautionary statement to investors. Certain statements made in the call today, such as those relating to future performance, plans and goals, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although the company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, investors are cautioned not to place undue reliance on such statements. Actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties which are beyond the company's control. Additional information concerning such risks and uncertainties can be found in the release relating to this presentation and the company's Annual Report for fiscal 2015 and the other periodic reports filed by the company with the SEC. Also, some of the comments made today may refer to non-GAAP financial measures, such as constant currency amounts, EBITDA and adjusted EBITDA. Additional information concerning these measures, including reconciliations to the most directly comparable GAAP financial measure, is contained in the financial presentation and release relating to this call. Both of which are posted on the company's website at www.kornferry.com. With that, I'll turn the call over to Mr. Burnison. Please go ahead, sir.

Okay. Thank you, Cathy. And good afternoon, everybody. And thank you for joining us. We just finished the fiscal year here and our fourth quarter and to say that I am pleased is an incredible understatement. This firm is I am just so proud of our colleagues here at Korn Ferry and what we are doing and what we've achieved particularly in this last quarter we closed out the year with a record high $272 million and I just point out that on a constant currency basis like any global company, currency hit us big time and on a constant currency basis that our revenue would have been $288 million just absolutely phenomenal. That represents 14% growth year-over-year, 11% growth sequentially. Both of those are constant currency. EBITDA was $41 million about 15% margins in the quarter. EPS was $0.51 and the fourth quarter results propelled this firm to over a $1 billion for the first time in our history on a constant currency basis. For the full year we would have been $1.52 billion I mean amazing. Our balance sheet per stain got $525 million in cash and marketable securities. And as I reflect back on this last year and what we are driving to be which is the preemptive authority on Leadership and Talent. I just highlight a couple things. I mean this last year we qualitatively and financially knocked the cover off the ball with our flagship search business number one we account for 30% of our revenue generated by those firms. We integrated all of the acquisitions, we took all the IP traded a number of new solutions, one out of four employees here at Korn Ferry is new over the last 24 months or so we put 35,000 professionals into new jobs over the last…

Great. Thanks, Gary. And good afternoon, everyone. As Gary indicated fiscal 2015 was another very strong year for Korn Ferry, year on which we achieved many major financial and operational milestones. While we continue to position the firm for future growth with key investments in people, processes and then intellectual property. Before I get into remarks so I do want to congratulate the whole Korn Ferry family for surpassing the $1 billion revenue threshold, they are truly is, at least in my view an exceptional feat. As investments spending around the world continues, we also continue to help our clients achieve their business objectives by assisting them in the design of talent strategies that enable them to build, develop and attract the best talent for the workforce. Our fourth quarter and total year financial results really demonstrate our success and validate the demand for our industry leading services. As Gary indicated our fee revenue in the fourth quarter reaching all time high of $272 million and it propelled the company's full year fee revenue to $1,028 million. At constant currency fee revenue for all of fiscal 2015 grew nearly $92 million or 9.6%. And out of that 42% of that annual fee revenue was generated from services outside of executive recruitment. Also at constant currency our fourth quarter fee revenue of $272 million was up $35.8 million, or 14.2% year-over-year and up $28.3 million or 11.3% sequentially. Some positive factors that impacted our fourth quarter fee revenues were the Pivot acquisition that contributed about $3.7 million for the two months. We had seasonally strong upticks which are up about $5.5 million sequentially and $3.5 million year-over-year. We also had seasonally strong sales of our perpetual licenses. We are up about $1 million sequentially and kind of flat year-over-year. Also as…

Okay. Thanks Bob. I'll start with our executive recruitment segment, globally, revenue for our Executive Recruitment segment was seasonally strong in the fourth quarter and actual foreign exchange consolidated Executive Recruitment fee revenue in the fourth quarter was $156.6 million, up $8.4 million, or 5.7% year-over-year and up $13.1 million, or 9.1% sequentially. As discussed on our third quarter earnings call, the current strength of the US dollar continued to be a significant headwind for growth for executive recruitment segment. Adjusting to constant currency, our consolidated executive recruitment fee revenue in the fourth quarter was up $18 million, or 12.1% year-over-year and up $16.8 million or 11.7% sequentially. On a regional basis at constant currency, North America was 10%, Europe was up 13.7%, Asia Pacific was up 10.6% and South America was up 37% year-over-year. On quarter sequential basis, also at constant currency North America grew 12.8%, Europe grew 13.5%, Asia Pacific was up 10.4% and South America was down 4% in the fourth quarter. For the full year at constant currency the Executive Recruitment segment was up 7.6% with growth in every region led by North America and Europe which were up 8.5% and 8.6% respectively. Compared to the fourth quarter a year ago growth in our Executive Recruitment specialty practice was mix in the fourth quarter. Worldwide growth was strongest in our financial services practice, up 17%, life sciences and healthcare practice up 11% and our consumer good practice up 6%; all our industrial and technologies practices were down 4% and 9% respectively. Financial services accounted for approximately 21% of all Executive Recruitment fee revenue in the fourth quarter which was up 190 basis points sequentially. Sequentially all of our specialty practices grew in the fourth quarter with the exception of the industrial practice. Financial services were up…

Great. Thanks, Gregg. Globally across all of our operating segment, the new business awards were seasonally strong in a fiscal fourth quarter. And they really provide us with a strong backlog of assignments as we enter into the first quarter of fiscal 2015. Our main new business was down compared to April and historically both June and July have been stronger month for us in terms of new business in advance of a seasonally softer August due to vacations. We also expect upticks and perpetual licenses sales to return to historical levels off of the fourth quarter seasonal high that I previously talked about. And in spite of the time required to ramp up the full productivity we do expect revenue contribution from our new hire consultants right onboard in both the fourth quarter of fiscal 2015 as well as some of those that we continue to bring on to date. Given all the above and assuming worldwide economic conditions, financial markets and foreign exchange rates remains steady, fee revenue in the first quarter of fiscal 2016 is likely to range from $258 million to $270 million and diluted earnings per share are likely to range from $0.44 to $0.50. So that concludes our prepared remarks. And we will be glad to answer any questions you may have.

[Operator Instructions] And we'll go first to George Tong of Piper Jaffray. Go ahead please.

Hi, good afternoon. Can you talk about trends we are seeing in North American exec search in May and June and how this compares to April and how they are tracking versus expectations?

Yes, I think, George, this is Bob. May the dollars that we saw in North America search in May were roughly flat with what we saw last year in May. But -- and it was interesting last year in May we had three very large search engagements, two CEOs and one Chief Compliance, Risk Compliance Officer. But the number of units this year is up about 20 over last year that's about 12%. And so we continue to see pretty robust activity in North American search.

Got it. That's helpful. As a follow up, can you discuss a bit your investment spending outlook in terms of the hiring of sales and recruiters. And which areas you think hires are growing into, what the anticipated impact will be on operating margin et cetera?

Well, we continue to bring talent into the organization. We also promote from within. So on beginning of May we probably promoted 20 or 30 colleagues to partner, so that would certainly -- that would hit when we talk next quarter. We've also got some consultants that we've hired but they hadn't started as of April 30. So we are continuing to add talent and on the leadership side we are following the same playbook.

And which areas are you hiring the most? If you had to breakout proportionally where these hires are going?

Well, we look at the opportunity really across the globe. And I wouldn't say that we are over weighted strategically in any one place. When you look at some recent activity a lot of that has been focused in the United States. But that's not -- that just -- that was kind of opportunistic. We are trying to bring talent in pretty evenly across the world.

Thank you. Our next question is from Tim McHugh with William Blair. Go ahead please.

Thank you. Just on the North American market. Does it feel like the environment change? I guess also the growth really picked up, you talked a little bit about factors that was driven partially by upticks which I know are lumpy but I guess how do you -- how does the market feel versus what it did 6, 12 months ago to you?

I don't think the market is substantially different. I don't think there is a huge tailwind nor do I think that there is a big headwind. It feels about the same, obviously you got softness in energy. You got the CEO confidence numbers that came out were weaker this week, we got a big jolts number which was substantially higher. So there are puts and takes but I don't really think I haven't seen any marked change in the last few weeks or months compared to six months ago.

So is the hiring more it feels like a picked up both in LTC and executive searcher as you said opportunistic or is there I guess is there another reason that it picked up pace?

Well we listen we've -- it is all about talent in any kind of industry. And talent is as important as strategy, so we've had it as a stated goal for a long time that we would add talent into our leadership, Futurestep, search business and that's what we've done.

Okay. And then just a number questions. Tax rate was I guess abnormally low this quarter. What are you assuming for Q1 and do you have any sense of what then for the full year of 2016?

Yes. Based on our preliminary replan for next year, Tim, it looks like the mix of earnings we have we are anticipating about 32% rate.

Is that for Q1, 2?

Yes. Yes.

Then our next question is from Mark Marcon with RW Baird. Go ahead please.

Good afternoon and congratulation and great to see. Gary you mentioned the environment doesn't feel that different than it did six months ago. But clearly the results are better. What would you primarily attribute that to? Would you say it's basically the gelling of the strategy and the go-to-market philosophy that you are executing against or what's driving it?

I think it is the -- yes I think it is a combination, I think it is the differentiated platform. I think it is the intellectual property and increase solutions. And then it is a talent that we are bringing in. I think all three or four those things combined are really resonating with our clients.

So it sounds like you are probably gaining share then as a result of these steps?

Again you look at the market opportunity and I think that you just take the -- what company spend in learning and development. I mean that's a $150 billion market. So I think if you look at myopically through an executive search lens you are going to find the market $3 billion to $5 billion. If you reorient yourself to what a CEO really thinks about driving talent to deliver superior business outcomes and I think your market sizing becomes larger. And that's what we are focused on.

Great. And can you talk a little bit about Pivot in terms of how it fits in with PDI and the other assets that you got there? How do you view that, the solutions set now?

It is -- where -- we've got a focus on adding capabilities around organizational design; around development and in the third case that we have a very big appetite forward would be around rewards. So those are some areas that we get at a great deal of capability too. And would not at all be redundant and in fact would be, would resonate with clients. So Pivot more is on the development side. A high end development team effectiveness say sweet kind of stuff.

Great. And then with regard to -- this was asked different way but in terms of the additional that you had on the executive search side. Is it been primarily focused on any one particular practice area and as a follow up to that really strong growth in financial services where is that coming from?

The financial services growth I mean you are right, we saw definitely an uptick there and it would be really spread across asset management. Even capital market to some extent I mean not like it was but even banking. So we saw kind of steady improvement there. That our business can tend to be impacted by one time kinds of things. So yes I wouldn't read too much into that. And then in terms of your specific question, we recently made a good investment into a team to help build out our capabilities in professional services. Now professional service organization spend billion of dollars in how they develop people, how they hire people and so we made an investment into a group of people that I think will deliver great things for us here in the future. But other than Mark I mean I think it has been, it's been pretty balanced.

Great. And then one last Gary. With regards to Futurestep and the RPO market. How much of Futurestep's growth is or what percentage of Futurestep is now RPO and what are you seeing in terms of RPO internationally now?

So we just signed a huge engagement with a European company, I mean multi million dollars to help build out technical capabilities. So it is a number one what we are seeing is this increasing desire in companies to find highly skilled, highly technical talent, it is kind of difficult to come by. So that's really playing quite well for that Futurestep business. And that's pretty consistent across the globe. But I think your question and Bob can you-- our RPO project business what was that.

Yes, Mark, I would say if you look at Futurestep's growth, the RPO projects, its solution business is about 60% of the total and single search is the remaining 40%. And both of those businesses grew and a rate they are contributed pretty evenly to the overall growth in that line of business this year. So we saw really good growth both the single search and the solution set side.

Thank you. We now have a question from Tobey Sommer with Suntrust. Go ahead please.

Thank you very much. Gary, the margins improved substantially, how do you structurally try to improve the margin profile of the firm from here? Thanks.

I think two things. I mean I think that the one is deeper penetration on current clients. We deal with 5000 clients a year. And to the extent that we can be smarter and deliver more value, broaden the services to existing clients that has a greater impact on profitability than anything else. So that's absolutely got to be the focus is outside and how you go to market and how you dedicate your talent pool towards opportunity. That's clearly number one. The second is to go into businesses that are more I'd say product oriented that where you can leverage IT, that would contribute to margins. So it is really those two things. Those aren't dreams, those are real possibilities. And we have to keep executing against both those path.

Thanks. That's kind of goes to my next question. Could you speak to the differentiation in the market place and how IP comes into play? So I understand you can probably leverage it across the segments perhaps supplying it more intensively to the executive search segment but I would love you speak about that. Thanks.

Well, number one the IP is being leveraged in all of the recruiting assignments that we do. So whether it is in the Futurestep business or the search business, that kind of talent if not about what those people have done, the candidates it is really who they are. So we've got a proprietary assessment that we just rolled out 4D that we think is the best anywhere and it is actually -- it is built on success, so what has been success of executives. And so that continue, all that given that we put somebody in a job every 3.5 minutes, you can imagine how many people we are seeing. When we put them through the assessment, it refreshes and we think we can show any client the difference between good and great in any country across any function. So that's number one. In terms of the product capability and what you can do there. There is opportunities not only to license that kind of a assessment tools to companies for them to use in hiring but we can also use those same kinds of things on the development side. Where clients can use our intellectual property on a license basis to develop their own people. So that's how we do it.

Thanks. Just two other questions for me. Could you repeat the new business award for Futurestep in the quarter? And then I was curious if from your perspective the upticks in the quarter, how you would view those in light of just kind of a cyclical potential for executive compensation growth to pickup? Thanks.

Okay. Tobey, this is Bob. In Futurestep, the new orders, I'll give you two by that the two line sort of segments so there are line of business. So the solutions piece was roughly say $45 million-ish and then the single search new orders in the quarter were about $18. So net-net it is little bit above $63 million.

Then in terms of your question on-- wage growth, this last number, you look at the BLS number it is 2.9%. We are definitely seeing a trend where used to be salary increases were 10% of payroll right I mean 20 years ago. That's not the case. Companies are going to more variable structures giving people Apple watches or time off but I don't -- analytically you would say that our average fee constant currency was $119,000 for the year, so that's highest during the quarter I guess, Gregg, it was quarter.

That's for the year.

For the year, yes.

So $119,000, that’s up a little bit for sure, I am not so sure I would -- I don't think you can extrapolate that [Technical Difficulty] growth I mean that's thing it is very difficult for us to measure and set guidance is that uptick piece. I mean it is several million dollars in a month and a fourth quarter does tend to be richer for sure. And there was a lot of uptick that came through.

Thank you. Bob, in terms of the -- can you split that for Futurestep? What was the growth for the overall new business?

Sequentially it was about 60%, I think 62% or 63% and then year-over-year it was about 90%, Tobey.

Okay, that's the part I was double checking. I thought I was too high or something, all right, thanks for your help.

Thank you. And we do have a follow up from Mark Marcon with RW Baird. Please go ahead.

With the 90% new business growth in a year-over-year basis for the RPO side, wouldn't that imply some acceleration?

Mark, listen it is very difficult to really assess that. I mean this quarter was definitely this last quarter was impacted for sure by some license sales, some higher than normal upticks. You are moving into the summer months. So I wouldn't make that call, intuitively I could see how one would say that. I just not so, we have to see if that actually flow through.

Yes, Mark, and specific to Futurestep because I had said of the business, I asked that very question and what's happening there is the tenure of the contract is stretching out longer and longer. So if you take the -- you maybe take the 118 and you play it out over time it will be fairly consistent with what we saw or what we've seen historically so you get like a third in the first year, third the second year and then the rest would spread out over the next say 18 months or so. So even though the dollar value of the awards are growing, the length of contracts is extending out as well which I mean both those obviously very good facts for us.

Certainly is. Then with regards to L&TC, in the past we've talked about there is a little bit of constraint in terms of the number of individuals who are skilled at selling those solutions. Can you give us a progress report in terms of how that's been going?

Well, the progress report I think we will be next quarter. And the quarter after, we've now -- we are up now Mark almost 40 consultant year-over-year, so that's about 28% up, we are 24 up sequentially, so we have made a marked investment in those colleagues. And it does take time to ramp up but they are still very, very difficult to come by. And quite candidly that's why, if you can make a bigger investment and not only get capabilities and solutions but people, that's an interesting way to do that at a faster pace. So that's a Pivot is a great example of that.

Thank you. And it appears there is no further question Mr. Burnison.

Okay. Well, listen I wanted to thank everybody for joining us and we look forward to reporting on our progress as we continue to build on our leadership position of helping companies deliver superior business outcomes through impactful people's strategy. So with that thank you very much and we'll talk to you next time.