<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 10-Q
(MARK ONE)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _________________ TO _________________.
------------------------
COMMISSION FILE NUMBER 1-10427
ROBERT HALF INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)
DELAWARE 94-1648752
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2884 SAND HILL ROAD 94025
SUITE 200 (zip-code)
MENLO PARK, CALIFORNIA
(Address of principal executive offices)
Registrant's telephone number, including area code: (650) 234-6000
------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) had been subject to such
filing requirements for the past 90 days. Yes /X/ No / /
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of April 30, 1999:
91,388,143 shares of $.001 par value Common Stock
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART I--FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1999 1998
----------- --------------
(UNAUDITED)
<S> <C> <C>
ASSETS:
Cash and cash equivalents............................................. $176,322 $166,060
Accounts receivable, less allowances of $11,021 and $10,176........... 255,524 240,690
Other current assets.................................................. 23,612 23,656
----------- --------------
Total current assets.............................................. 455,458 430,406
Intangible assets, less accumulated amortization of $55,106 and
$53,236............................................................. 176,370 178,363
Property and equipment, less accumulated depreciation of $55,171 and
$48,900............................................................. 102,834 94,950
----------- --------------
Total assets...................................................... $734,662 $703,719
----------- --------------
----------- --------------
LIABILITIES AND STOCKHOLDERS' EQUITY:
Accounts payable and accrued expenses................................. $ 25,228 $ 23,659
Accrued payroll costs................................................. 119,295 124,068
Income taxes payable.................................................. 8,211 3,810
Current portion of notes payable and other indebtedness............... 985 1,308
----------- --------------
Total current liabilities......................................... 153,719 152,845
Notes payable and other indebtedness, less current portion............ 3,432 3,404
Deferred income taxes................................................. 24,125 25,000
----------- --------------
Total liabilities................................................. 181,276 181,249
Commitments and Contingencies
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value authorized 260,000,000 shares; issued
and outstanding 91,152,371 and 91,225,353 shares.................... 91 91
Capital surplus....................................................... 286,416 270,609
Deferred compensation................................................. (58,226) (56,790)
Accumulated other comprehensive income................................ (2,173) (1,244)
Retained earnings..................................................... 327,278 309,804
----------- --------------
Total stockholders' equity........................................ 553,386 522,470
----------- --------------
Total liabilities and stockholders' equity........................ $734,662 $703,719
----------- --------------
----------- --------------
</TABLE>
The accompanying Notes to Consolidated Financial Statements are
an integral part of these financial statements.
1
<PAGE>
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
----------------------
1999 1998
---------- ----------
(UNAUDITED)
<S> <C> <C>
Net service revenues...................................................................... $ 484,988 $ 401,296
Direct costs of services, consisting of payroll, payroll taxes and insurance costs for
temporary employees..................................................................... 287,093 240,325
---------- ----------
Gross margin.............................................................................. 197,895 160,971
Selling, general and administrative expenses.............................................. 138,990 111,970
Amortization of intangible assets......................................................... 1,229 1,233
Interest income, net...................................................................... (1,307) (1,174)
---------- ----------
Income before income taxes................................................................ 58,983 48,942
Provision for income taxes................................................................ 23,673 19,892
---------- ----------
Net income................................................................................ $ 35,310 $ 29,050
---------- ----------
---------- ----------
Basic net income per share................................................................ $ .39 $ .32
Diluted net income per share.............................................................. $ .38 $ .31
</TABLE>
The accompanying Notes to Consolidated Financial Statements are
an integral part of these financial statements.
2
<PAGE>
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
----------------------
1999 1998
---------- ----------
(UNAUDITED)
<S> <C> <C>
COMMON STOCK--SHARES:
Balance at beginning of period.......................................................... 91,225 91,208
Issuances of restricted stock........................................................... 245 281
Repurchases of common stock............................................................. (466) (237)
Exercises of stock options.............................................................. 148 697
---------- ----------
Balance at end of period.............................................................. 91,152 91,949
---------- ----------
---------- ----------
COMMON STOCK--PAR VALUE:
Balance at beginning of period.......................................................... $ 91 $ 91
Exercises of stock options.............................................................. -- 1
---------- ----------
Balance at end of period.............................................................. $ 91 $ 92
---------- ----------
---------- ----------
CAPITAL SURPLUS:
Balance at beginning of period.......................................................... $ 270,609 $ 196,888
Issuances of restricted stock--excess over par value.................................... 7,166 11,249
Exercises of stock options--excess over par value....................................... 1,080 4,321
Capital impact of equity incentive plans................................................ 7,561 14,222
---------- ----------
Balance at end of period.............................................................. $ 286,416 $ 226,680
---------- ----------
---------- ----------
DEFERRED COMPENSATION:
Balance at beginning of period.......................................................... $ (56,790) $ (44,276)
Issuances of restricted stock........................................................... (7,166) (11,249)
Amortization of deferred compensation................................................... 5,730 4,443
---------- ----------
Balance at end of period.............................................................. $ (58,226) $ (51,082)
---------- ----------
---------- ----------
ACCUMULATED OTHER COMPREHENSIVE INCOME:
Balance at beginning of period.......................................................... $ (1,244) $ (1,347)
Translation adjustments................................................................. (929) (41)
---------- ----------
Balance at end of period.............................................................. $ (2,173) $ (1,388)
---------- ----------
---------- ----------
RETAINED EARNINGS:
Balance at beginning of period.......................................................... $ 309,804 $ 267,444
Repurchases of common stock--excess over par value...................................... (17,836) (9,693)
Net income.............................................................................. 35,310 29,050
---------- ----------
Balance at end of period.............................................................. $ 327,278 $ 286,801
---------- ----------
---------- ----------
COMPREHENSIVE INCOME:
Net income.............................................................................. $ 35,310 $ 29,050
Translation adjustments................................................................. (929) (41)
---------- ----------
Total comprehensive income............................................................ $ 34,381 $ 29,009
---------- ----------
---------- ----------
</TABLE>
The accompanying Notes to Consolidated Financial Statements are
an integral part of these financial statements.
3
<PAGE>
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
----------------------
1999 1998
---------- ----------
(UNAUDITED)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.............................................................................. $ 35,310 $ 29,050
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible assets................................................... 1,229 1,233
Depreciation expense................................................................ 6,736 3,980
Provision for deferred income taxes................................................. 480 3,044
Changes in assets and liabilities, net of effects of acquisitions:
Increase in accounts receivable..................................................... (14,834) (18,652)
Increase (decrease) in accounts payable, accrued expenses and accrued payroll
costs............................................................................. (2,409) 18,591
Increase (decrease) in income taxes payable......................................... 4,401 (2,745)
Change in other assets, net of change in other liabilities.......................... 4,475 2,153
---------- ----------
Total adjustments..................................................................... 78 7,604
---------- ----------
Net cash and cash equivalents provided by operating activities.......................... 35,388 36,654
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures.................................................................... (15,951) (16,141)
---------- ----------
Net cash and cash equivalents used in investing activities.............................. (15,951) (16,141)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchases of common stock and common stock equivalents................................ (17,836) (9,693)
Principal payments on notes payable and other indebtedness.............................. 20 (2,281)
Proceeds and capital impact of equity incentive plans................................... 8,641 18,544
---------- ----------
Net cash and cash equivalents (used in) provided by financing activities................ (9,175) 6,570
---------- ----------
Net increase in cash and cash equivalents................................................. 10,262 27,083
Cash and cash equivalents at beginning of period.......................................... 166,060 131,349
---------- ----------
Cash and cash equivalents at end of period................................................ $ 176,322 $ 158,432
---------- ----------
---------- ----------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest.............................................................................. $ 92 $ 96
Income taxes.......................................................................... $ 11,318 $ 5,028
</TABLE>
The accompanying Notes to Consolidated Financial Statements are
an integral part of these financial statements.
4
<PAGE>
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999
(UNAUDITED)
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS. Robert Half International Inc. (the "Company")
provides specialized staffing services through such divisions as
ACCOUNTEMPS-Registered Trademark-, ROBERT HALF-Registered Trademark-,
OFFICETEAM-Registered Trademark-, RHI CONSULTING-Registered Trademark-, RHI
MANAGEMENT RESOURCES-Registered Trademark-, THE AFFILIATES-Registered Trademark-
and THE CREATIVE GROUP-SM-. The Company, through its ACCOUNTEMPS, ROBERT HALF
and RHI MANAGEMENT RESOURCES divisions, is the world's largest specialized
provider of temporary, full-time, and project professionals in the fields of
accounting and finance. OFFICETEAM specializes in highly skilled temporary
administrative support personnel. RHI CONSULTING provides contract information
technology professionals. THE AFFILIATES provides temporary, project, and
full-time staffing of attorneys and specialized support personnel within law
firms and corporate legal departments. THE CREATIVE GROUP provides project
staffing in the advertising, marketing, and Web design fields. Revenues are
predominantly from temporary services. The Company operates in the United
States, Canada, Europe, and Australia. The Company is a Delaware corporation.
PRINCIPLES OF CONSOLIDATION. The Consolidated Financial Statements include
the accounts of the Company and its subsidiaries, all of which are wholly-owned.
All significant intercompany balances have been eliminated. Certain
reclassifications have been made to the 1998 financial statements to conform to
the 1999 presentation.
INTERIM FINANCIAL INFORMATION. The Consolidated Financial Statements have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission ("SEC") and, in management's opinion, include all
adjustments necessary for a fair statement of results for such interim periods.
Certain information and note disclosures normally included in annual financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to SEC rules or regulations; however,
the Company believes that the disclosures made are adequate to make the
information presented not misleading.
The interim results for the three months ended March 31, 1999, and 1998 are
not necessarily indicative of results for the full year. It is suggested that
these financial statements be read in conjunction with the financial statements
and the notes thereto included in the Company's Annual Report on Form 10-K for
the year ended December 31, 1998.
REVENUE RECOGNITION. Temporary services revenues are recognized when the
services are rendered by the Company's temporary employees. Permanent placement
revenues are recognized when employment candidates accept offers of permanent
employment. Allowances are established to estimate losses due to placed
candidates not remaining employed for the Company's guarantee period, typically
90 days.
CASH AND CASH EQUIVALENTS. The Company considers all highly liquid
investments with a maturity of three months or less as cash equivalents.
INTANGIBLE ASSETS. Intangible assets primarily consist of the cost of
acquired companies in excess of the fair market value of their net tangible
assets at acquisition date, which are being amortized on a straight-line basis
over a period of 40 years. The carrying value of intangible assets is
periodically reviewed by the Company and impairments are recognized when the
expected future operating cash flows derived from such intangible assets are
less than their carrying value. Based upon its most recent analysis, the Company
believes that no material impairment of intangible assets existed at March 31,
1999.
5
<PAGE>
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1999
(UNAUDITED)
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES. Deferred taxes are computed based on the difference between
the financial statement and income tax bases of assets and liabilities using the
enacted marginal tax rates.
FOREIGN CURRENCY TRANSLATION. The results of operations of the Company's
foreign subsidiaries are translated at the monthly average exchange rates
prevailing during the period. The financial position of the Company's foreign
subsidiaries is translated at the current exchange rates at the end of the
period, and the related translation adjustments are recorded as part of
Stockholders' Equity. Gains and losses resulting from foreign currency
transactions are included in the Consolidated Statements of Income.
USE OF ESTIMATES. The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.
PROPERTY AND EQUIPMENT. Property and equipment are recorded at cost.
Depreciation expense is computed using the straight-line method over the
estimated useful lives of the assets. Leasehold improvements are amortized over
the shorter of the life of the related asset or the life of the lease.
NOTE B--BUSINESS SEGMENTS
In 1998, the Company adopted Statement of Financial Accounting Standard No.
131 (SFAS No. 131), DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE AND RELATED
INFORMATION. The Company has defined its business segments based on the nature
of services for the purposes of reporting under SFAS No. 131. The Company is
managed in a matrix form of organization with certain managers responsible for
service lines while other managers are responsible for geographic territories.
As such, both service line and geographic information is used in allocating
resources and measuring performance.
The Company has two reportable segments: temporary and consultant staffing;
and permanent placement staffing. The temporary and consultant staffing segment
provides specialized personnel in the accounting and finance, administrative and
office, information technology, legal, advertising, marketing, and Web design
fields. The permanent placement staffing segment provides full-time personnel in
the accounting, finance, and information technology fields.
The accounting policies of the segments are the same as those described in
Note A: Summary of Significant Accounting Policies. The Company evaluates
performance based on profit or loss from operations before interest expense,
intangible amortization expense, and income taxes.
6
<PAGE>
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1999
(UNAUDITED)
NOTE B--BUSINESS SEGMENTS (CONTINUED)
The following table provides a reconciliation of revenue and operating
profit by reportable segment to consolidated results (in thousands):
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
----------------------
1999 1998
---------- ----------
(UNAUDITED)
<S> <C> <C>
Net service revenues
Temporary and consultant staffing................................... $ 449,123 $ 371,167
Permanent placement staffing........................................ 35,865 30,129
---------- ----------
$ 484,988 $ 401,296
---------- ----------
---------- ----------
Operating income
Temporary and consultant staffing................................... $ 50,301 $ 41,034
Permanent placement staffing........................................ 8,604 7,967
---------- ----------
58,905 49,001
Amortization of intangible assets..................................... 1,229 1,233
Interest income, net.................................................. (1,307) (1,174)
---------- ----------
Income before income taxes............................................ $ 58,983 $ 48,942
---------- ----------
---------- ----------
</TABLE>
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Certain information contained in Management's Discussion and Analysis and in
other parts of this report may be deemed forward-looking statements regarding
events and financial trends that may affect the Company's future operating
results or financial positions. Such statements may be identified by words such
as "estimate", "project", "plan", "intend", "believe", "expect", "anticipate",
or variations or negatives thereof or by similar or comparable words or phrases.
Forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ materially from those expressed in the
statements. Such risks and uncertainties include, but are not limited to, the
following: changes in general or local economic conditions or in the economic
condition of any industry, the availability of qualified staff employees and
temporary candidates, government regulation of the personnel services industry,
general regulations relating to employers and employees, liability risks
associated with the operation of a personnel services business, competitive
conditions in the personnel services industry, and Year 2000 issues. In
addition, it should be noted that, because long-term contracts are not a
significant portion of the Company's business, future results cannot be reliably
predicted by considering past trends or extrapolating past results.
RESULTS OF OPERATIONS FOR EACH OF THE THREE MONTHS ENDED MARCH 31, 1999 AND
1998.
Temporary services revenues were $449 million and $371 million for the three
months ended March 31, 1999 and 1998, respectively, increasing by 21% during the
three months ended March 31, 1999 compared to the same period in 1998. The
increase in revenues during these periods reflected in part revenues generated
from the Company's OFFICETEAM, RHI CONSULTING, and RHI MANAGEMENT RESOURCES
divisions, which were started in 1991, 1994 and 1997, respectively. Permanent
placement revenues were $36 million and $30 million for the three months ended
March 31, 1999 and 1998, respectively, increasing by 20% during the three months
ended March 31, 1999 compared to the same period in 1998. Overall revenue
increases reflect continued improvement in demand for the Company's services,
which the Company believes is a result of increased acceptance in the use of
professional staffing services.
The Company currently has more than 240 offices in 39 states and six foreign
countries. Domestic operations represented 88% and 90% of revenues for the three
months ended March 31, 1999 and 1998, respectively. Foreign operations
represented 12% and 10% of revenues for the three months ended March 31, 1999
and 1998, respectively.
Gross margin dollars from the Company's temporary services represent
revenues less direct costs of services, which consist of payroll, payroll taxes
and insurance costs for temporary employees. Gross margin dollars from permanent
placement services are equal to revenues, as there are no direct costs
associated with such revenues. Gross margin dollars for the Company's temporary
services were $162 million and $131 million for the three months ended March 31,
1999 and 1998, respectively, increasing by 24% in 1999. Gross margin amounts
equaled 36% and 35% of revenues for temporary services for the three months
ended March 31, 1999 and 1998, respectively, which the Company believes reflects
its ability to adjust billing rates and wage rates to underlying market
conditions. Gross margin dollars for the Company's permanent placement division
were $36 million and $30 million for the three months ended March 31, 1999 and
1998, respectively, increasing by 20% for the three months ended March 31, 1999.
Selling, general and administrative expenses were $139 million for the three
months ended March 31, 1999 compared to $112 million for the three months ended
March 31, 1998. Selling, general and administrative expenses as a percentage of
revenues were 29% and 28% for the three months ended March 31, 1999 and 1998,
respectively. Selling, general and administrative expenses consist primarily of
staff compensation, advertising and occupancy costs, most of which generally
follow changes in revenues.
The Company allocates the excess of cost over the fair market value of the
net tangible assets first to identifiable intangible assets, if any, and then to
goodwill. Although management believes that goodwill has
8
<PAGE>
an unlimited life, the Company amortizes these costs over 40 years. Management
believes that its strategy of making acquisitions of established companies in
established markets and maintaining its presence in these markets preserves the
goodwill for an indeterminate period. The carrying value of intangible assets is
periodically reviewed by the Company and impairments are recognized when the
expected future operating cash flows derived from such intangible assets is less
than their carrying value. Based upon its most recent analysis, the Company
believes that no material impairment of intangible assets existed at March 31,
1999. Intangible assets represented 24% of total assets and 32% of total
stockholders' equity at March 31, 1999.
Interest income for the three months ended March 31, 1999 and 1998 was
$1,538,000 and $1,450,000, respectively. Interest expense for the three months
ended March 31, 1999 and 1998 was $231,000 and $276,000, respectively. The
change in interest income reflects an increase in cash and cash equivalents.
The provision for income taxes was 40% and 41% for the three months ended
March 31, 1999 and 1998, respectively.
LIQUIDITY AND CAPITAL RESOURCES
The change in the Company's liquidity during the three months ended March
31, 1999 is the net effect of funds generated by operations and the funds used
for capital expenditures and principal payments on outstanding notes payable. In
October 1997, the Company authorized the repurchase, from time to time, of up to
four million shares of the Company's common stock on the open market or in
privately negotiated transactions, depending on market conditions. During the
three months ended March 31, 1999, the Company repurchased approximately 200,000
shares of common stock on the open market for a total cost of $6.5 million.
Since 1997, the Company has repurchased approximately 1,925,000 shares on the
open market pursuant to this program. Repurchases of the securities have been
funded with cash generated from operations. For the three months ended March 31,
1999, the Company generated $35 million from operations, used $16 million in
investing activities and used $9 million in financing activities.
The Company's working capital at March 31, 1999, included $176 million in
cash and cash equivalents. In addition at March 31, 1999, the Company had
available $73 million of its $80 million bank revolving line of credit. The
Company's working capital requirements consist primarily of the financing of
accounts receivable. While there can be no assurances in this regard, the
Company expects that internally generated cash plus the bank revolving line of
credit will be sufficient to support the working capital needs of the Company,
the Company's fixed payments, and other obligations on both a short and
long-term basis. As of March 31, 1999, the Company had no material capital
commitments.
The Company's primary exposures related to the Year 2000 are in its key
internal information systems. The Company is addressing the Year 2000 exposures
as part of its strategic plan for upgrading core systems.
Since 1997, the Company has initiated a number of major system projects to
replace core computer hardware, networking, and software systems in the U.S.
with new technology. The Company has purchased software from outside vendors and
is working with outside consultants to install the software and train employees.
The Company's key vendors supplying this technology have asserted that these
hardware, networking, and software systems are Year 2000 compliant. The Company
does not plan to test these systems for Year 2000 compliance given the
contractual representations made by its key vendors.
The Company is currently rolling out these new systems throughout the
organization in phases, by location. The first phase has been completed on
schedule and the remaining are scheduled to be complete before the Year 2000.
The Company is also in the process of upgrading all desktop computers to a model
that is Year 2000 compliant and expects to complete this upgrade in 1999. The
Company expects to spend in excess of $44 million on these systems and desktop
upgrade projects of which approximately $41 million has been incurred to date.
9
<PAGE>
The Company is undertaking steps to assess the effect of the Year 2000 issue
with respect to its foreign operating units and suppliers and at this time,
cannot determine the impact it will have. Contingency plans will be developed if
it appears the Company or its key suppliers will not be Year 2000 compliant as
noncompliance would have a material adverse impact on the Company's operations.
The Company will adopt SOP 98-1, ACCOUNTING FOR THE COSTS OF COMPUTER
SOFTWARE DEVELOPED FOR INTERNAL USE, which requires the capitalization of
certain costs related to the development of software for internal use in fiscal
year 1999. The Company believes that the adoption of this standard will not have
a material impact on its financial results.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company's market risk sensitive instruments do not subject the Company
to material market risk exposures.
10
<PAGE>
PART II--OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
- ------------- ----------------------------------------
<C> <S>
11 Computation of Per Share Earnings.
27 Financial Data Schedule.
</TABLE>
(b) The registrant filed no current report on Form 8-K during the quarter
covered by this report.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ROBERT HALF INTERNATIONAL INC.
(Registrant)
/s/ M. KEITH WADDELL
--------------------------------------
M. Keith Waddell
SENIOR VICE PRESIDENT, CHIEF FINANCIAL
OFFICER AND TREASURER
(PRINCIPAL FINANCIAL OFFICER AND
DULY AUTHORIZED SIGNATORY)
Date: May 11, 1999
12
<PAGE>
Exhibit 11
ROBERT HALF INTERNATIONAL INC. AND SUBSIDIARIES
COMPUTATION OF PER SHARE EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
--------------------
1999 1998
--------- ---------
(UNAUDITED)
<S> <C> <C>
Net
Income.................................................................................. $ 35,310 $ 29,050
--------- ---------
--------- ---------
Weighted Average Number Of Shares Outstanding:
Basic:
Weighted average shares................................................................. 91,267 91,623
--------- ---------
--------- ---------
Diluted:
Weighted average shares................................................................. 91,267 91,623
Common stock equivalents--Stock options (A)............................................. 2,390 3,300
--------- ---------
Diluted shares outstanding.............................................................. 93,657 94,923
--------- ---------
--------- ---------
Net Income Per Share:
Basic..................................................................................... $ .39 $ .32
Diluted................................................................................... $ .38 $ .31
</TABLE>
- ------------------------
(A) The treasury stock method was used to determine the weighted average number
of shares of common stock equivalents outstanding during the periods.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 1999
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 176,322
<SECURITIES> 0
<RECEIVABLES> 266,545
<ALLOWANCES> 11,021
<INVENTORY> 0
<CURRENT-ASSETS> 455,458
<PP&E> 158,005
<DEPRECIATION> 55,171
<TOTAL-ASSETS> 734,662
<CURRENT-LIABILITIES> 153,719
<BONDS> 4,417
0
0
<COMMON> 91
<OTHER-SE> 553,295
<TOTAL-LIABILITY-AND-EQUITY> 734,662
<SALES> 0
<TOTAL-REVENUES> 484,988
<CGS> 0
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<INTEREST-EXPENSE> (1,307)
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<INCOME-TAX> 23,673
<INCOME-CONTINUING> 35,310
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 35,310
<EPS-PRIMARY> .39
<EPS-DILUTED> .38
</TABLE>
