Ladies and gentlemen, thank you for standing by, and welcome to the Korn/Ferry International Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. Before I turn the conference over to our host, Gary Burnison, let me first read a cautionary statement to investors. Certain statements made in the presentation today such as those relating to future performance, plans and goals will 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 2011 and in other periodic reports filed by the company with the SEC. Also, some of the comments today will reference non-GAAP financial measures, such as adjusted operating earnings. Investors should review our reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures contained in the release relating to this presentation, which is posted on the company's website at www.kornferry.com. With that, I'll turn the conference over to Mr. Burnison. Please go ahead.

Well, thank you. Thank you, everyone, for joining us, and good afternoon. Today, we reported fee revenue of about $186 million and an operating margin of slightly over 9%, and our balance sheet continues to be absolutely pristine. The good news for a very, very cyclical quarter, I would say, with an early Chinese New Year this year was that our Leadership and Talent Consulting solutions business was up 11% year-over-year. It was about $28 million for the quarter. Futurestep also showed growth in the quarter. It was up 11% year-over-year and performed very, very well. And both of these continue to signal to us that clients are saying that we've got more things to talk about and more flexibility to help them with their broader talent need. The other good news is that our productivity was up and our average fee continues to rise. On a more challenging side, our Executive Recruiting business year-over-year was down slightly, again, in a very cyclical quarter, and it would be down about 2% on a constant-currency basis. We continue to view the world outside in, and that's through the lens of our clients. And today that lens reflects the fight for growth and relevancy, as well as doing more with less. That's clearly the new normal. And with that we see a strong opportunity to capitalize on the environment by leveraging our brand and linking our talent management capabilities to our client's business needs. And so our strategy, which we believe is differentiated and is working, provides us the ability to help global organizations not only attract, but also to engage, develop and retain the talent they need for a competitive edge. We continue to drive a proactive, consistent, integrated solutions-based approach, systematically targeting global and region client opportunities and, more importantly, aligning our people and intellectual property to drive much deeper, more scalable client relationships. I'm also very proud of the fact in terms of the progress we're making around our intellectual property, which we believe will be a substantial competitive differentiator. Our IP is also being embraced within institutions of higher learning today. About 1/3 of the top 12 business schools in the United States are using our IP. We continue to not only elevate the brand as witnessed by the average fee, but we continue to extend the brand. Today, 86% of our top 50 clients are using at least 2 of our 3 service lines. Our work at the top continues to accelerate, and as importantly, about 1/3 of those engagements at the board level were for the Fortune 300 companies in excess of $10 billion. I'm pleased with the efforts of our colleagues around the globe and the results that we're achieving by driving a solutions-based approach to clients. Every quarter we continue to further broaden our service offerings, broaden the conversation with our clients, build larger relationships and elevate our brand and, more importantly, really over time, fortifying our image as the company to turn to for talent. And that's the heart of our strategy, is to make talent management synonymous with our brand. And so with that, I would, briefly here, turn it over to Bob Rozek, who has recently joined us. Gregg Kvochak is also here. Bob comes from us with a very distinguished background. He's a partner at Pricewaterhouse, was most recently the CFO of Cushman & Wakefield, was the CFO of Las Vegas Sands and worked at Kodak. So I am very, very happy that he is joining us and that we can welcome him as our partner. Bob, you want to make a couple of comments here?

That'd be great, Gary. Thanks lot. Good afternoon, everyone. As you know this is my first quarterly earnings call with Korn/Ferry, and I'm very happy and excited to be working with Gary and the fine team that he's assembled. My first couple of weeks at the company have been extremely positive, and I'm very confident that my experience to date is going to be reflective of what I can expect as we move forward. As I begin to look at and understand the company's growth strategy, I believe that my background in building out company infrastructure will really fit nicely with the company and enable the company to meet its ambitious growth plans. I look forward to working with Gary and his team. And now I'm going to turn it over to Gregg Kvochak to review the operating results for the third quarter.

Thanks, Bob. Demand in the third quarter for our market-leading recruitment and talent management consulting services was impacted by both year-end holiday seasonality, as well as the continued sluggish worldwide economic recovery. Our fiscal 2012 third quarter consolidated fee revenue was $186 million, down $14 million or 7% compared to the second quarter of fiscal 2012 and flat compared to the third quarter of fiscal 2011. Measured on a constant-currency basis, our firm's third quarter fee revenue was at $189.5 million, down 5% as compared to the second quarter and off 50 basis points year-over-year. Monthly new business trends improved in January compared to December. And for the entire third quarter, the total number of newly opened, combined executive search and Leadership Talent Consulting assignments was down 10% sequentially and off 7% year-over-year. Due primarily to the decline in fee revenue, both operating earnings and margins slipped in the third quarter from what was reported in the second quarter of fiscal 2012. Our fiscal 2012 third quarter consolidated operating earnings were $16.2 million, down $9.2 million or 36% sequentially and off $4.3 million or 21% year-over-year. Operating margin was 8.7% in the third quarter compared to 12.7% in the second quarter of fiscal 2012 and 11% in the third quarter of fiscal 2011. Excluding the negative impact of a net $930,000 adjustment in the quarter to an estimated restructuring liability that was originally recorded in a prior period, third quarter adjusted operating earnings were $17.1 million, down $8.3 million or 33% sequentially and off $3.4 million or 17% year-over-year. On this adjusted basis, operating margin was 9.2% in the third quarter of fiscal 2012. Only 2 parts of our operations, executive recruitment in Europe and in South America achieved operating profitability improvement both sequentially and year-over-year in the third quarter of fiscal 2012. We continue a strong cash generation as our third quarter ending cash and marketable securities balance was $352 million, up $34 million sequentially and $48 million year-over-year. Excluding cash and marketable securities reserved for deferred compensation arrangements and for accrued bonuses, the current investable cash balance is approximately $187 million, which is up $16 million sequentially and up $55 million compared to the balance at the third quarter of fiscal 2011. Finally, fiscal 2012 third quarter diluted earnings per share were $0.25, a decrease of $0.07 or 22% sequentially, and $0.05 or 17% year-over-year. Excluding the negative impact of the $930,000 restructuring charge adjustment, third quarter adjusted diluted earnings per share were $0.26. Now turning to our operating segments starting with Executive Recruitment. Due primarily to seasonally slow -- slower demand and continued worldwide weakness in the Financial Services specialty market, consolidated third quarter Executive Recruiting fee revenue was $160.1 million, down $11.4 million or 6% sequentially and down $3 million or 1.8% year-over-year. On a constant-currency basis, Executive Recruitment fiscal 2012 third quarter fee revenue was down $8.5 million or 5% sequentially and down $3.3 million or 2% year-over-year. Sequentially, third quarter fee revenue was down in every major specialty practice most significantly in Financial Services, which is off 18% compared to the second quarter of fiscal 2012. Compared to the third quarter of fiscal 2011, growth was achieved in all specialty practices except Financial Services and technology, which were off 20% and 23%, respectively. In the North American region, fiscal 2012 third quarter fee revenue was $90 million, down $7.5 million or 7.7% sequentially and off $5 million or 5.3% versus the prior year. Sequentially, all major specialty markets contracted in the third quarter with the Financial Services practice off 25%. Newly confirmed assignments in North America were down 14% in the third quarter of fiscal 2012 versus the second quarter of fiscal 2012 and down 7% compared to the third quarter of fiscal 2011. Despite seasonal factors and tough economic headwinds, fee revenue trends in Europe remained relatively stable. At actual rates, Europe's fee revenue was up $240,000 or 60 basis points sequentially and up $440,000 or 1.1% year-over-year in the third quarter reaching $40.5 million. On a constant-currency basis, Europe's fiscal 2012 third quarter fee revenue was up $2.1 million or 5.2% sequentially and up $530,000 or 1.4% compared to the third quarter of fiscal 2011. Six of 17 countries grew sequentially in the third quarter led by the U.K., which was up 14%. On a specialty market basis, all major practices grew slightly on a sequential basis with the exception of the life sciences and health care practice, which is down 21%. Financial Services in Europe was up 4% sequentially, but off 16% year-over-year. Market conditions in Asia Pacific were also seasonally weak and adversely impacted by the timing of Chinese New Year, which fell in January. At actual rates, Asia Pacific's third quarter fee revenue fell to $20.9 million, down $4.3 million or 17% sequentially, but up $490,000 or 2.4% year-over-year. On a constant-currency basis, fiscal 2012 third quarter fee revenue was $21.3 million, down $3.9 million or 15.7% sequentially and essentially flat year-over-year. Sequential fee revenue growth was achieved in 4 of 11 countries in the third quarter with strength in Japan, up 9%, and Korea, up 8%. On a specialty market basis, all specialty practices were down sequentially with the exception of life sciences and health care, which grew 14%. In the Asia Pacific region, Financial Services was off 35% sequentially and 7% year-over-year. At actual rates, South America's fiscal 2012 third quarter fee revenue was $8.7 million, up $160,000 or 2% sequentially and $1 million or 13% year-over-year. Measured on a constant-currency basis, South America's third quarter fee revenue was up approximately $700,000 or 8% sequentially and up $1 million or 13% year-over-year. Fee revenue in Brazil was up 2% sequentially and 11% year-over-year. The total number of Executive Recruiting consultants at the end of the third quarter was 441, down 21 compared to the second quarter and down 33 year-over-year. Annualized fee revenue production per consultant in the third quarter was down 3% sequentially, but up 3% year-over-year to approximately $1.34 million. Consolidated Executive Recruitment operating earnings fell $8.8 million or 24% sequentially and $990,000 or 3% year-over-year to $28.1 million. The consolidated Executive Recruitment operating margin was 17.5% in the third quarter compared to 21.5% in the second quarter of fiscal 2012 and 17.8% in the third quarter of fiscal 2011. Excluding a net adjustment in the quarter to a restructuring charge estimate recorded in the prior period, consolidated Executive Recruitment operating earnings were $28.8 million with an 18% operating margin. Now turning to Futurestep, which also experienced seasonally slower demand in the third quarter. At actual rates, consolidated Futurestep third quarter fee revenue was $25.8 million, down $2.7 million or 10% sequentially, but up $2.5 million or 11% year-over-year. Measured on a constant-currency basis, third quarter fee revenue was down $2.1 million or 7% sequentially, but up $2.3 million or 10% year-over-year. Geographically, sequential growth was seasonally weakest in North America and Asia Pacific, where constant currency growth was off 14% and 8%, respectively. Futurestep's operating earnings contracted to $890,000 in the third quarter. Sequentially, Futurestep's operating earnings fell $1.4 million or 450 basis points contraction in margin to 3.4%. Compared to the third quarter of fiscal 2011, Futurestep's fiscal 2012 third quarter operating earnings were down $377,000 or 30%, and operating margin was down 200 basis points. Excluding a negative adjustment in the quarter to a restructuring charge estimate recorded in the prior period, Futurestep's operating earnings were $1 million with a 4% operating margin. Now turning to our outlook for the fourth quarter of fiscal 2012. So far early in the fourth quarter of fiscal 2012, consolidated new business awards have been in line with our expectations. Compared to January, February executive search confirmations were flat in North America and up in Europe and Asia Pacific. Futurestep's revenue also improved in February compared to January. However, the sluggish and uncertain recovery of the global economy continues to cloud visibility making accurate forecasting difficult. Assuming that economic conditions, financial markets and foreign exchange rates remain relatively stable, fiscal 2012 fourth quarter fee revenue will likely range from $182 million to $196 million. Finally, diluted earnings per share for the fourth quarter will likely range from $0.24 to $0.30 excluding $0.03 to $0.04 of estimated non-recurring compensation-related charges or $0.21 to $0.27 measured by GAAP. That concludes our prepared remarks. We'll be glad to take your questions.

[Operator Instructions] And our first question comes from Tim McHugh from William Blair & Company.

First I want to ask about the headcount. So for the second, kind of, quarter in a row, headcount was down by a decent amount, and so it’s now down 7% year-over-year. I know you usually don't like to commit too much to what you're going to do, but is that, one, touch on how much of that was voluntary versus involuntary. And then do you -- are you at a point where you're going to start trying to grow that at all going forward?

I think, Tim, involuntary. Substantially, all -- last August we became very concerned with the volatility in the equity markets. And beginning late last August and into the end of calendar 2011, we took some actions relative to the company to make sure that we were as efficient as possible. And that's what we did. We don't comment more than a quarter out on headcount. I would just say that I would not expect that kind of a trend to continue in the near term. And we're looking to invest in the business.

Okay. And then contrasting that, if headcount's down 7% year-over-year, the comp and benefits was flat and SG&A was up, can you just -- why was headcount down but then comp and benefits down along with that? And then I guess can you touch on more so the factors that drove the SG&A increase?

Tim, I'm not sure I understand the first part of your question.

If headcount is down 7%, why isn't compensation and benefits down as much along with it.

It’s primarily due to the hiring we've done in Futurestep year-to-date. As we said in the last few calls, most of the heads we've added, certainly this fiscal year, have been in Futurestep.

We, I think, if you look in the fourth quarter, Tim, our expectation would be that the G&A levels would come down. There may be a slight increase in the comp ratio, but we look at that outsourcing business and see again a multi-hundred million dollar opportunity for us. So we've continued to invest in that business.

And the legal and professional fees, is that -- usually that's M&A related-type activity, I guess. Is that fair to assume or were there other issues or items that you were spending on?

Yes, Tim, really, as a matter of practice, we really never get into that kind of detail.

What I would say is that when you look at the G&A expense for the fourth quarter, our anticipation would be that it would go down.

And now to the line of Tobey Sommer from SunTrust Robinson.

I just wanted to ask about the sequential change in new confirmations, new assignments in the quarter. So it was down, I think I heard a high-single digit percentage, but what would a normal seasonal decline be? Certainly the January quarter would probably be a little seasonally weak compared to the October.

Yes, it would be. And when you look at the business -- let me -- I'll start with North America. I'll just go back several months for you. October was running at a substantially higher pace than the trailing 6 months. November was off substantially and impacted the pipeline. December was up over November and back to levels that we saw earlier in calendar 2011. January was about the level of December, and February was pretty close. In Europe, Europe has continued to surprise us. December was obviously very low in terms of new business awards, which we thought it would be. And January was very healthy in terms of new business in Europe.

And I think when you were going through the segments, I heard Gregg mention that the health and life sciences managed a good sequential rebound from what, at the time on your prior quarterly conference call, you mentioned was probably a temporary slowdown there. Could you describe what your feelings are and thoughts are on that specific segments?

Yes, well, I think first of all when you look at the big picture and if you want to talk sequentially, first of all there, we got hit by constant currency, by currency fluctuations right off the bat compared to the second quarter, you've got to add $3 million, $4 million, something like that. And when you compare it sequentially, where we really saw the softness was in, one, Financial Services. Then secondly, in Futurestep, sequentially. In terms of the life sciences, you're absolutely right. In December, we talked about a blip that we saw in life sciences in November, and that business returned to levels that we had previously seen.

My last question has to do with your ever-growing pile of spendable cash. Are you seeing more interesting opportunities than you did a couple of quarters ago? Any changes in seller expectations that may allow you to deploy that in a more interesting fashion than just collecting a point of interest?

Well, we really don't comment. I would say that our preference continues to be investing in the business. I mean, we really believe that we've got a $15 billion market opportunity. We want to see 10% of that. We believe that we've got opportunities in our flagship business to continue to move the brand upstream, to continue to invest in intellectual property. We look at our leadership businesses and Futurestep businesses and see multi-hundred million dollar opportunities. And our first preference would be to invest, to use the cash in our businesses. And that's really been our mindset for the past several quarters. It continues to be and we're always looking for solutions, for offerings that can broaden the conversation with our clients.

And now to the line of Giri Krishnan from Crédit Suisse.

I guess I wanted to drill down on Asia. I think -- I'm sort of surprised that Europe, despite all the headwinds, stayed relatively better, and I know Asia was impacted by the New Year, but could you comment about what the trends are in Asia? And when you look at productivity, is there more room for pickup in Asia relative to the other geographies?

Well, I would first say that I spent a couple of months, we led the business over the last summer from Shanghai and very, very close to that business. We believe that, that continues to remain a huge opportunity, obviously, with consumerism as that continues to be tapped. Given the efforts that were put in place several quarters ago around reserve requirements in China, clearly that had an impact, and you read it in the paper today that there was a cooling off. And now as they go to loosen the reserve requirements as there's a transition in government, we would expect that, that business would return to levels that we saw last calendar year. And longer term, I'm even more bullish.

Okay. And given -- I think, you spoke at a conference, if I caught it right, it was flat in North America in February and up in Asia and flat in Europe, but does that, compared to when you spoke to us last quarter, does it feel, maybe given the macro environment is improving, that we may be seeing an improvement? Do you think that it be bottomed or is it too early to tell if things are, in fact, could be turning?

Well, look, we can't -- we cannot make those calls. We can tell you what our next quarter's projection is based on. Clearly there's a new normal here. There's a lot of optimism coming into this calendar year. What we've seen in February certainly substantiates that.

And now to the line of Kevin McVeigh from Macquarie.

If you could just refresh us on, kind of, where the verticals stand now? Out of 100%, just round numbers. How much is Financial Services and technology, so on and so forth?

Well, okay, we’ll do that for you. I would first start -- it's a pretty balanced portfolio overall. Our bellwether and flagship is our industrial business. That continues to perform very, very well around the world. That is about 30% of the company. Financial Services has never been a overly exposed part of the portfolio. Today, that's about 15% consumer, is about that, maybe 16% life sciences, and health care is another 16% or so, and technology is about 14%, something like that, and that gets you pretty close to 100%.

Got it. And in terms of -- Gary, have there been any kind of changes within Whitehead Mann? I know that's kind of going back a little bit, but has that been performing as expected?

It's been, look, it's been fabulous, knock on wood. Because as Gregg said, I mean, there is choppiness for sure. You can see it when you look at the Internet or read the paper. But the U.K., ironically, in a very, as you know, a very difficult Financial Services market, had its second best quarter ever, which I think is very impressive.

And then just real quick. On the $0.03 comp charge, Gregg, if I heard -- I just want to make sure I understand what that was. It's excluded from the guidance, as I understand it. Do you typically do that? I don't think so. And what's the reason that you're kind of calling it out right now?

Well, we're calling it out right now because we know that we've taken some actions here in the fourth quarter. Part of that is around a management transition. Part of it is around a piece of our business in Futurestep, where we think we can drive greater efficiencies out of the business. And that's really all it is.

Okay. And then, Bob, switching gears, I know you haven't been on the ground all that long, but love to kind of hear what you're thinking in terms of Korn/Ferry, what drove you there and kind of areas that you're going to focus on right out of the gate here.

I think there's really 3 things as I thought about the opportunity that I focused on. One, what was important to me, it's been important to me my entire career, is to go to a great brand name, and Korn/Ferry is just that. Second was the culture of an organization, again, is something that's very important for me. And as I met Gary and the rest of the management team and the board members, it was a culture that was very attractive to me. It's a culture that I thought would fit well with my personality, and the type of person that I am. I think the last thing that enticed me the most was, and as I talked to Gary, about his strategy and where he sees the company going forward and what he's trying to do with the brand name. To me I think there's enormous opportunity here to do some great things. And so those are the things that really excited me to join Korn/Ferry. In terms of where my focus is going to be first. I think I'm at a point where I'm just 2 weeks in now, so I've got a lot of wood to chop before I have my thoughts and my plans in place. So over the next couple of weeks and months and so on, that'll get better, so then I can really get myself focused. Right now, I'm going to just focus on learning as much as I can about the organization, trying to establish relationships with the folks in the company, so I can make my role meaningful in the organization. And then once I get it all sorted out, I'll figure out my highest priorities as we move forward.

And now to the line of Mark Marcon from R.W. Baird.

I was wondering, Gary, could you -- as you look at North America, could you drill down in terms of the elements that you think had the greatest impact on -- we don't have the consultant reduction by geography. So could -- how much would you attribute to the decline in terms of the number of consultants? How much would you say is Financial Services? What other factors might be impacting things?

Yes, Mark, the efforts we took beginning last August contributed almost nothing to the decline, I would say. It's really when you look at it, Mark, it's Financial Services. That's the story both sequentially and year-over-year.

But wasn't almost every practice down sequentially in North America this past quarter?

You're talking about Financial Services or you're talking about broadly?

In North America, I thought when Gregg was going through his commentary that he said that all practices were down sequentially. He didn't give the year-over-year number, and obviously there's a lot of seasonality.

Yes, there's a lot of seasonality. And certainly what Gregg indicated, that's absolutely what we saw. But when you really cut through it and look at the seasonality, the story is Financial Services, Mark.

Okay. So from your perspective in North America, outside of Financial Services, things look good?

Well, again, I can't make a qualitative comment on good or bad, but I would just tell you that the confirmation trends, absent last November, have been relatively consistent.

Okay, are you seeing anything at all in terms of the composition of the types of engagements that you're getting outside of Financial Services, just in terms of types of rolls, things of that nature.

No, no. I mean, look, not on however many searches we do a year. It would be very, very tough to generalize. We continue to see great traction around succession planning and all that. It's part of our leadership solutions. We continue to elevate this brand. And our average search fee, when you take out the LTC solutions, is -- has risen substantially over the years, and we're very, very proud of that.

How much has the average search fee increased?

Well, when you look at the segment, we look at the business together with Executive Search and LTC. But if you were to take out the LTC business, the average search fee is about $110,000 or so a year. That's what it was in the quarter, Mark. When you add everything together, it's obviously less than that.

Okay. And can you give an example of how you're thinking about monetizing the intellectual property? Can you give us some real life examples in terms of how that plays in?

Well, we're working on things right now that I wouldn't want to say, but I would -- well, there's a couple of things, Mark. Well, there's 3 things. I think one thing is you're hired for what you know and you're fired for who you are, and particularly at the level that we deal with. So what we’re really trying to do is take our intellectual property and use it in our business, in our Executive Recruiting and Futurestep businesses as a differentiator to really probe further in terms of who somebody is. And we think we've got great traction with that. We use it on about 65% of our Executive Search assignments around the world. We measure that. We monitor that. So that's one. The other thing that we've got an opportunity to do with the intellectual property is actually monetize it. And through distribution channels of our own, as well as other potential partners, we believe that we can take that intellectual property and distribute that out in an open network through other partners, and we're pursuing that.

Great. And you just recently had a big win in terms of bringing over somebody who is pretty well known in tech. Can you talk a little bit about the plans for the tech practice?

Well, the -- we did bring in an executive that we're very proud of, who has a proven track record in this business, as well as an operator in the technology area. The gentleman is European. Very, very proud to have him. And our plan on the technology side is to invest. If you look at the portfolio today, Mark, it's -- I want to get this -- it's probably about 13% or so, and we believe that should be several percentage points higher as a firm. And that's our objective here is to create that top-of-mind brand in the technology area. And, hopefully, with the team that we have, that is very good, and with Bernard coming onboard, we will do that.

Great. And then lastly, I was wondering if -- whether this is a question for Gregg or Gary. Can you talk a little bit about the trends as we should, when we take a look at your guidance as it relates to the coming quarter, how that should fall out regionally?

On a regional basis, on the top line, Mark, I think you should expect maybe kind of a flattish outlook in the North America region, up in European region, up a little in the Asia Pacific region, up a little in Latin America and then also up a little at Futurestep as well.

Again that is based on what we're seeing to this point.

Okay. Gary, we’re getting lots of data points that would suggest that the U.S. labor market is picking up outside of Financial Services. Are you seeing things that are different than that?

I think that the companies continue to do more with less, Mark. I would say at some point productivity levels are going to reach the point where you've got to do something for sure. But I've long -- I mean, I've said this is a Nike Swoosh. I continue to believe that particularly in an election year and then in Asia, in China, a transition to a new government.

And now to the line of Jennifer Wong of UBS.

So maybe can you just provide some more color behind Europe? And I know you’ve mentioned U.K. was very strong despite a challenging financial services market, and sort of said it will be up -- you would expect it to be up in the fourth quarter as well. What drove the outperformance, the stability in the U.K.? I mean do you see that for the rest of Europe or were there other standout markets?

Well, look, again, we're only -- we're reporting through what we've seen, again, in February. We have to definitely emphasize that. And if you read the papers in terms of what's happening, you would certainly -- you would have some skepticism around that. But look, I'm not sure. We've got a fabulous team. I'm very, very proud of our European team. We set out 5 years ago, when I became CEO, that I really thought we need to be a global firm, less American. Our European team is top notch. I believe our U.K. business is the flagship of the organization. We compete at the top levels, and we've got great leadership.

Okay. In terms of other markets in Europe, was the stability pretty broad based?

We have seen over a longer term, not just sequentially, but over several many more months, we've seen an increasing contribution from Switzerland. That's been a big part of us. Germany as well. We've got a fabulous team there. And then when I talked sequentially, if you just narrowly focus on sequentially, we've -- again, Gregg talked about the U.K. and we also saw some improvement in France relative to the quarter 2 but again in France, that was down a little bit versus what it's historically been. So again, we -- again, cautiously optimistic, certainly, given what you read in the papers.

And now to the line of Tobey Sommer from SunTrust Robinson.

Gary, just had a question for you on Futurestep. Their customers often talk about big group hires that get executed over a period of time. I was wondering if you could tell us if -- give some color on whether they're following through with those plans that take a while to execute?

Yes. We have not -- yes, absolutely. We haven't seen any kind of material cancellations or anything like that. Our Futurestep business, as you know, we continue to move it from single search to RPO consulting business. We still have a fair amount of single search that we do, but we haven't seen any signs like that.

And last -- another one of my questions, is it still your view that, for now, social media is a tool for your business, particularly in the Futurestep single search level or is it also a competitor?

I think social media is a way of life. I mean, it is. We hope to take advantage of it, and we're driving with the strategy to absolutely do that. And so we view it as a tool. We view it as an opportunity, and we view it as a way of life.

And now to the line of Frank Atkins from SunTrust.

Three quick numbers questions, if I can. The tax rate implied in guidance or that was used in guidance, the percentage or amount of revenue from Leadership Consulting? And also, if you could give the average fee per assignment on a consolidated basis.

Sure. The implied tax rate in the guidance for the fourth quarter would be approximately 35%. And I don't think we, as a matter of practice, give out the LTC figures in the way of guidance. But, Frank, you should assume that's roughly flat with the third quarter. And I'm sorry, what was the last question?

I guess the Leadership I was actually asking, what was revenue from 3Q?

I think Gary commented on that, but it was $28 million.

And the last one was consolidated average fee per assignment, you gave it excluding Leadership.

Yes, consolidated, it's about $83,000.

And now to the line of Mark Marcon from R.W. Baird.

On your LTC business, you've actually seen some fairly good growth. Can you talk a little bit about the areas of strength that you're seeing there? How widespread is it? And are you, in fact, going to split it out as we look out towards the next fiscal year?

Well, we believe that, that is an integral part of our executive recruiting business. We're going to continue to evaluate that. When you look at the service offerings there from onboarding to succession planning, to strategic alignment, we've seen very good growth across the different service lines. And we're very proud that this was a $6 million, $7 million assessment practice 6.5 years ago, and today we're running at almost $120 million a year. And our goal is to create the most globally relevant leadership business in the world. We believe that, that should be $0.25 billion business for us, and that's what we're aiming to build.

Great. And then can you talk a little bit about the headcount planned as you look out based on what you're currently seeing? How much capacity should we think we have in the system at this point, Gary? And should we anticipate further now that we've made some actions and it looks like maybe the U.S. is stabilized that we're going to start picking up the hiring? Or how should we think about that?

Well, we do think there's -- I mean just take Financial Services as a quick example. I mean, as our portfolio, we typically target 20% or so. It's running at 15%. That's going to generate, whatever it is, $40 million, $50 million easily with the fabulous team that we have. And we have just a world-class team there, and you can just look at that automatically without blinking an eye. So again, we believe that we certainly have room for capacity. And what we've done on the consultant count was very planned. And we did it. God, that decision was made, literally, it seems like 6 or 7 months ago, right? So...

And then in the other practices, Gary, just Financial Services, you're one of the most astute observers of the industry. You've obviously practiced in the industry yourself, so you know it could take a while before that comes back just from a demand perspective. I'm just thinking the other service lines.

Well, we’re running right now, globally, at a little bit south of $1.4 million. God, we would hope that there would, at least, be another 10% if not more on top of that. Why shouldn't there be?

It appears that there are no further questions, Mr. Burnison.

Okay. Well, listen, I greatly appreciate everyone this afternoon for listening. Thank you for our shareholders. Thank you for our colleagues, and we look forward to speaking to you again. Thank you.

Thank you. Ladies and gentlemen, this conference will be available for replay for one week starting today at 7:00 p.m. Eastern Standard Time and running through March 14 at midnight. You may access the AT&T Executive Playback Service by dialing 1 (800) 475-6701 and entering the access code 239802. International participants may dial (320) 365-3844. Additionally, the replay will be available for playback at the company's website, www.kornferry.com, in the Investor Relations section. That does conclude our conference, you may now disconnect.