Segments | 10. Segments The Company currently operates through three global business segments: Advisory, Executive Search and RPO & Professional Search. Advisory assists clients to synchronize strategy and talent by addressing four fundamental needs: Organizational Strategy, Assessment and Succession, Leadership Development and Rewards and Benefits, all underpinned by a comprehensive array of some of the world’s leading IP, products and tools. Executive Search focuses on recruiting board level, chief executive and other senior executive and general management positions The Company evaluates performance and allocates resources based on the Company’s chief operating decision maker’s review of (1) fee revenue and (2) adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). To the extent that such charges occur, Adjusted EBITDA excludes restructuring charges, integration/acquisition costs, certain separation costs and certain non-cash charges (goodwill, intangible asset and other than temporary impairment). The accounting policies for the reportable segments are the same as those described in the summary of significant accounting policies in Note 1— Organization and Summary of Significant Accounting Policies Financial highlights by business segment are as follows: Three Months Ended October 31, 2019 Executive Search Advisory North America EMEA Asia Pacific Latin America Subtotal RPO & Professional Search Corporate Consolidated (in thousands) Fee revenue $ 209,760 $ 113,818 $ 39,821 $ 25,944 $ 8,272 $ 187,855 $ 94,774 $ — $ 492,389 Total revenue $ 213,922 $ 117,077 $ 40,441 $ 26,168 $ 8,273 $ 191,959 $ 98,296 $ — $ 504,177 Net income attributable to Korn Ferry $ 42,804 Net income attributable to noncontrolling interest 228 Other income, net (1,133 ) Interest expense, net 4,210 Income tax provision 15,760 Operating income (loss) $ 28,391 $ 28,124 $ 6,511 $ 5,803 $ 791 $ 41,229 $ 15,094 $ (22,845 ) 61,869 Depreciation and amortization 8,042 869 450 329 315 1,963 990 1,720 12,715 Other income (loss), net 520 637 107 72 30 846 54 (287 ) 1,133 EBITDA 36,953 29,630 7,068 6,204 1,136 44,038 16,138 (21,412 ) 75,717 Integration/acquisition costs — — — — — — — 2,615 2,615 Adjusted EBITDA $ 36,953 $ 29,630 $ 7,068 $ 6,204 $ 1,136 $ 44,038 $ 16,138 $ (18,797 ) $ 78,332 Three Months Ended October 31, 2018 Executive Search Advisory North America EMEA Asia Pacific Latin America Subtotal RPO & Professional Search Corporate Consolidated (in thousands) Fee revenue $ 217,089 $ 115,863 $ 44,928 $ 27,936 $ 8,907 $ 197,634 $ 80,482 $ — $ 495,205 Total revenue $ 221,419 $ 119,322 $ 45,636 $ 28,146 $ 8,912 $ 202,016 $ 83,358 $ — $ 506,793 Net income attributable to Korn Ferry $ 46,034 Net income attributable to noncontrolling interest 1,283 Other loss, net 4,500 Interest expense, net 4,337 Income tax provision 14,833 Operating income (loss) $ 29,426 $ 35,328 $ 7,319 $ 6,767 $ 2,053 $ 51,467 $ 12,516 $ (22,422 ) 70,987 Depreciation and amortization 6,964 968 95 375 101 1,539 761 1,754 11,018 Other income (loss), net 265 (3,981 ) 22 77 93 (3,789 ) (79 ) (897 ) (4,500 ) EBITDA 36,655 32,315 7,436 7,219 2,247 49,217 13,198 (21,565 ) 77,505 Integration/acquisition costs 2,755 — — — — — — 80 2,835 Adjusted EBITDA $ 39,410 $ 32,315 $ 7,436 $ 7,219 $ 2,247 $ 49,217 $ 13,198 $ (21,485 ) $ 80,340 Six Months Ended October 31, 2019 Executive Search Advisory North America EMEA Asia Pacific Latin America Subtotal RPO & Professional Search Corporate Consolidated (in thousands) Fee revenue $ 405,286 $ 225,540 $ 86,351 $ 53,306 $ 15,857 $ 381,054 $ 190,598 $ — $ 976,938 Total revenue $ 413,242 $ 232,523 $ 87,753 $ 53,836 $ 15,860 $ 389,972 $ 197,161 $ — $ 1,000,375 Net income attributable to Korn Ferry $ 85,755 Net income attributable to noncontrolling interest 927 Other income, net (2,959 ) Interest expense, net 8,267 Income tax provision 30,213 Operating income (loss) $ 54,182 $ 58,446 $ 13,822 $ 12,796 $ 1,801 $ 86,865 $ 30,135 $ (48,979 ) 122,203 Depreciation and amortization 16,095 1,770 906 675 643 3,994 1,982 3,421 25,492 Other income (loss), net 1,246 1,777 119 87 87 2,070 128 (485 ) 2,959 EBITDA 71,523 61,993 14,847 13,558 2,531 92,929 32,245 (46,043 ) 150,654 Integration/acquisition costs — — — — — — — 2,615 2,615 Adjusted EBITDA $ 71,523 $ 61,993 $ 14,847 $ 13,558 $ 2,531 $ 92,929 $ 32,245 $ (43,428 ) $ 153,269 Six Months Ended October 31, 2018 Executive Search Advisory North America EMEA Asia Pacific Latin America Subtotal RPO & Professional Search Corporate Consolidated (in thousands) Fee revenue $ 412,464 $ 227,960 $ 91,582 $ 54,231 $ 16,785 $ 390,558 $ 157,751 $ — $ 960,773 Total revenue $ 421,566 $ 235,079 $ 93,385 $ 54,771 $ 16,815 $ 400,050 $ 163,539 $ — $ 985,155 Net income attributable to Korn Ferry $ 7,423 Net income attributable to noncontrolling interest 1,302 Other income, net (20 ) Interest expense, net 8,440 Income tax benefit (1,277 ) Operating income (loss) $ (53,653 ) $ 61,842 $ 14,288 $ 13,408 $ 2,807 $ 92,345 $ 24,161 $ (46,985 ) 15,868 Depreciation and amortization 14,395 1,947 465 745 208 3,365 1,522 3,467 22,749 Other income (loss), net 835 (480 ) 362 252 130 264 26 (1,105 ) 20 EBITDA (38,423 ) 63,309 15,115 14,405 3,145 95,974 25,709 (44,623 ) 38,637 Integration/acquisition costs 5,782 — — — — — — 160 5,942 Tradename write-offs 106,555 — — — — — — — 106,555 Adjusted EBITDA $ 73,914 $ 63,309 $ 15,115 $ 14,405 $ 3,145 $ 95,974 $ 25,709 $ (44,463 ) $ 151,134 |