Gary D. Burnison - Chief Executive Officer, President, Treasurer and Executive Director Robert P. Rozek - Chief Financial Officer, Principal Accounting Officer and Executive Vice President Gregg Kvochak

Kevin D. McVeigh - Macquarie Research Timothy McHugh - William Blair & Company L.L.C., Research Division Tobey Sommer - SunTrust Robinson Humphrey, Inc., Research Division Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division Ty Govatos

Ladies and gentlemen, thank you for standing by, and welcome to the Korn/Ferry Second Quarter Fiscal Year 2014 Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded for replay purposes. [Operator Instructions] 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 risks and uncertainties can be found in the release relating to this presentation, in the company's annual report for fiscal 2013 and in the other periodic reports filed by the company with the SEC. Also, some of the comments today may reference 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, Mr. Burnison. Gary D. Burnison: Well, hello, everybody. Good afternoon, and thank you for joining us. I got to tell you that I'm very proud of our company and our 3,600 employees around the world. We just completed the strongest top line results in the company's history. We had revenue of about $238 million. That was up about 23% over last year on a constant currency basis and a 4% increase sequentially. So our business on an annualized basis based just off the second quarter is doing about $952 million of revenue and throwing off EBITDA on an adjusted basis of almost $150 million. Our adjusted EBITDA margin was approximately 15.5%. That compares to about 12.5% a year ago and 14% in the prior quarter. Adjusted EPS was $0.41, and that's up 24% sequentially and 64% year-over-year. As calendar 2013 comes to a close, the narrative on the economic climate really hasn't changed dramatically. We're in the throes of a new era. One that I've frequently referenced as an unprecedented fight for growth. And speaking with corporate leaders, it's a consensus that the problem of growth, or the lack of it, is rapidly becoming the world's #1 problem. Governments and corporations alike are grappling with the growth question, albeit from different perspectives. And that's exactly the environment that is going to create opportunity for Korn/Ferry, as we help clients drive growth by more effectively linking their business and talent strategies. And it all begins with our flagship search business, which was up 11% year-over-year in a constant currency basis, and it was up sequentially as well. This business is -- it's just a fabulous business. We change people's lives. It's a door opener for broader talent management offerings. It gives us license and access within C-suites all over the world, and our overarching goal is to differentiate and drive revenue across our broader talent solutions capabilities. And executive search is the tip of that spear. It gives us that trust. It gives us that permission, allowing us to engage in discussions with clients about other solutions that may be their buying piecemeal from other providers. And what we bring is fabulous professionals, industry-leading professionals, high-caliber client service of global reach, unique IP, all to help clients design, build and attract talents for the purpose of driving superior performance; in other words, to ignite talent. And during this last year, I think the strength and the steadiness of our strategy has really taken hold, not only by the performance of our search business and where that is, but Korn/Ferry overall, including our non-Search business, which now represents about 41% of the top line. So you've got a company, based on the second quarter, that's doing $952 million of revenue and $264 million of that comes from our leadership business and $128 million comes from Futurestep. And so that 41% of the revenue mix is an all-time high. Of course, that was aided by acquisitions. On an EBITDA basis, Futurestep and LTC represented about 36%, 37% of the EBITDA. Our Futurestep business grew 8% on a constant currency basis. That was driven by the strength of the RPO business. And our leadership offering was $66 million in the quarter. Again, if you just were to annualize that mathematically, that's $264 million. That's up 10% sequentially with a 15.5% adjusted EBITDA margin. And much of that success, I got to tell you, can be attributed to the acquisitions that we've done, Global Novations, a little over a year ago. It's been a game changer for us, as well as PDI, which took place almost exactly 1 year ago. And since that time, we have integrated those firms. We've established new go-to-market protocols. We've successfully onboarded 600 new colleagues, 20% of the company. We've accelerated our delivery process. We've integrated world-class IT, and we've reconciled the offerings that we have. In the year ahead, we're going to remain committed to anchoring our company and knowledge and data using IP as a differentiator throughout all of our business, cascading innovation to our clients. And we believe offerings that are going to enhance our competitive edge in the marketplace. And so I'm certainly very, very proud and pleased. I'm proud of our employees, our colleagues around the world, I can't say that enough, and the accomplishments we've made throughout this calendar year. I'm even more excited about what the future holds for Korn/Ferry. So with that, I've got Gregg Kvochak is here; and Bob Rozek, our Chief Financial Officer. So Bob, I'll turn it over to you. Robert P. Rozek: Great. Thanks, Gary, and good afternoon, everyone. As a global labor market gradually recovers and we continue to make progress, bringing our comprehensive suite of talent management solutions to a broader number of clients, Korn/Ferry continues to be positioned as a leader in defining the talent management solution space. As Gary mentioned, we are extremely proud of our second quarter fiscal '14. Despite our normal late summer seasonality, we achieved record-high fee revenues in earnings. On constant currency, our consolidated fee revenue in the quarter grew $44 million or 23% year-over-year to the all-time high of $238 million with growth across all of our major operating segments. Also measured on a constant currency basis, fee revenue improved $9 million or 4% sequentially, again, with up growth in all service lines. Additionally, on an organic basis, excluding the revenue from the acquisitions that Gary just mentioned, our consolidated fee revenue was up 8% year-over-year at constant currency. And as also, as Gary mentioned, very pleased that 41% of those revenues come from services outside of search. And then our overall growth continues to outpace many of our major industry competitors. Executive search's new business awards were pretty choppy in the second quarter. Confirmations were sequentially down in the months of August and September, but they really surged back to a 15-month high in October. Our new business confirmations in the second quarter were essentially flat compared to the first quarter of fiscal '14. And our overall new business is up nearly 12% when compared to the second quarter of fiscal '13. In LTC, new business awards continue to gain momentum through the quarter with total second quarter new business up approximately 13% compared to the first quarter. And in Futurestep, our backlog grew sharply in the second quarter as they secured a record number of large, multiyear, multimillion dollar RPO assignments in North America, Europe and Asia Pac. When you combine these assignments, on an annual basis, the recruiting level will be over 9,000 professionals across the globe for the next 3-plus years. Our profitability also continues to improve in the second quarter. Excluding restructuring, integration and separation charges in the current and prior periods, our adjusted EBITDA improved both sequentially and year-over-year, growing $4.8 million or 15%, sequentially, and $12.2 million or 50% year-over-year, reaching a record $36.7 million in the second quarter. Our adjusted EBITDA margin was 15.4% in the second quarter compared to 14% in the first quarter and 12.5% in the second quarter of last year. By segment, our sequential profitability improvement was mixed. In executive search, our adjusted EBITDA margin fell 140 basis points, due primarily to the increase in the second quarter in our variable incentive compensation cost, as well as market-driven investment gains associated with our deferred comp plan that result in increased compensation expense. In L&TC, our adjusted EBITDA margin improved 150 basis points sequentially, driven by higher fee revenue across the more efficient and stable post acquisition cost base. In our Futurestep, our adjusted EBITDA margin fell 540 basis points sequentially and 280 basis points year-over-year, due primarily to the recognition in the quarter of start-up costs associated with the larger RPO wins that I've previously described. And I know the RPO engagements, the revenue would be recognized in future periods as the contract milestones are completed. But we're obviously are incurring some start-up costs in the current quarters as we ramp those up. Over time, when we get to a full ramp-up on those contracts, we expect Futurestep's EBITDA margins to return to the more normalized level in the 12% to 14% range. On a GAAP basis, including all restructuring, integration and separation charges, fiscal '14 second quarter operating earnings were $23.2 million with a 9.7% margin compared to $16.6 million and a 7.3% margin in the first quarter of fiscal '14 and $2.8 million and a 1.4% margin in the second quarter of fiscal '13. In the second quarter, we also incurred $2 million of additional management separation charges. Our financial position also continue to improve in the second quarter with ending total cash and marketable securities of $315 million, up $35 million compared to the first quarter of fiscal '14 and down $17 million compared to the second quarter of fiscal '13. Excluding cash and marketable securities reserved for deferred comp arrangements and for accrued bonuses, our current investable cash balance is approximately $127 million, down $6 million versus the first quarter with about 22% of net cash residing in the U.S. Finally, excluding all restructuring integration and separation charges in the current and prior quarters, second quarter adjusted diluted earnings per share were a record $0.41, an improvement of $0.08 or 24% sequentially, and $0.16 or 64% year-over-year. On a GAAP basis, including the impact of all those charges, our fiscal '14 second quarter diluted earnings per share were $0.38 compared to $0.23 in the first quarter of fiscal '14 and $0.03 in the second quarter of fiscal '13. I'll now turn the call over to Gregg to review our operating segments in a little more detail.

Thanks, Bob. Let's start with our Executive Recruitment segment. Despite the seasonality of the summer months, global demand for our Executive Recruitment services improved in the second quarter. Consolidated Executive Recruitment fee revenue in the second quarter was $140 million, up $3.3 million or 2.4% sequentially, and up $12.2 million or 9.6% year-over-year. Measured at constant currency, second quarter consolidated Executive Recruiting fee revenue was up 2.3% sequentially and up 10.9% year-over-year. Regionally, also at constant currency, North America was up 1.5%; Asia-Pacific was up 4%; South America was up 31.7%, Europe was seasonally weaker by 3% on a sequential basis. Year-over-year, also on a constant currency basis, North America grew 8.7%; Europe grew 1.2%; Asia-Pacific was up 25.1%; and South America was up 42.1%. Sequential growth in our Executive Recruitment specialty practices was mixed in the second quarter. Worldwide growth was strongest in our life sciences and health care practice, up 10%, and our technology practice, up 11%. While our consumer goods, financial service and industrial practices were down 8%, 3% and 2%, respectively. Financial services accounted for approximately 16.5% of all Executive Recruitment fee revenue in the second quarter, down approximately 100 basis points from the first quarter of fiscal '14. Year-over-year, also at actual rates, all of our specialty practices grew in the second quarter with the exception of the consumer goods practice. Life sciences and health care was up 35%. Technology was up 16%, while financial services and industrial were up 1% each. Worldwide, the consumer goods practice were down 7% year-over-year in the second quarter, driven primarily by softer market conditions in North America and Europe. The total number of dedicated executive recruiting consultants worldwide at the end of the second quarter was 412, up 10, year-over-year, and down 4, sequentially. Annualized fee revenue production per consultant in the second quarter was approximately $1.35 million compared to approximately $1.25 million in the second quarter of fiscal '13 and $1.34 million in the first quarter of fiscal '14. The number of new search assignments opened worldwide in the second quarter was 1,300, which was up 11%, year-over-year, and up 7%, sequentially. Excluding all restructuring charges, consolidated executive search adjusted EBITDA and margin in the second quarter improved $7.4 million or 31.7% year-over-year with a 370-basis-point improvement in margin. This improvement was driven primarily by higher consultant productivity and lower fixed and variable G&A expense. On a sequential basis, consolidated executive search adjusted EBITDA was down $1.2 million or 3.7% due primarily, as Bob mentioned earlier, to slightly higher variable compensation expense and market-driven investment gains associated with the firm's deferred compensation plan that adversely impacted compensation and benefit expense. Executive search consolidated adjusted EBITDA margin was 21.9% in the second quarter of fiscal '14 compared to 23.3% in the first quarter of fiscal '14 and 18.2% in the second quarter of fiscal '13. Now turning to our Leadership & Talent Consulting segment. In the second quarter of fiscal '14, worldwide fee revenue for L&TC improved to a new high of $66 million. Measured on a constant currency basis, L&TC fee revenue grew sequentially, $5.8 million or 9.7%, with strong growth in North America and Asia Pacific, offsetting seasonal weakness in Europe. Year-over-year, on an organic basis, excluding the fee revenue from the recent acquisitions of both Global Novations and PDI Ninth House, L&TC's fee revenue was down $500,000 or 1.5%. Regionally, North America accounted for approximately 71% of the total L&TC worldwide fee revenue in the second quarter compared to 67% in the first quarter of fiscal '14. At the end of the second quarter, there were 129 dedicated L&TC consultants compared to 134 in the first quarter of fiscal '14 and 72 in the second quarter of fiscal '13. Professional staff utilization improved to 70% in the second quarter, up 500 basis points sequentially. Compared to the first quarter of fiscal '14, L&TC's adjusted EBITDA improved $1.8 million or 21.7% to $10.2 million, driven by both higher fee revenue and a stable, more efficient cost post-integration cost base. Adjusted EBITDA margin in the second quarter was 15.5% compared to 14% in the first quarter of fiscal '14 and 20.7% in the second quarter of fiscal '13. Finally, turning to Futurestep, which generated $31.9 million of fee revenue in the second quarter. Measured on a constant currency basis, Futurestep's second quarter fee revenue was up $2.4 million or 7.9% year-over-year and up $200,000 or 60 basis points sequentially. On a regional basis, measured sequentially at constant currency, North America was down 3.1%; Europe was essentially flat; while Asia-Pacific was up 4.9%. As previously mentioned, Futurestep's confirmed backlog search in the second quarter as they were awarded multiple large RPO contracts that will generate fee revenue over the next several years. Futurestep's adjusted EBITDA margin was 9.3% in the second quarter and slipped both sequentially and year-over-year, primarily due to start-up costs incurred in the second quarter associated with the new RPO wins, for the timing of revenue recognition will be deferred to future periods as contract milestones are completed, as Bob previously discussed. Now I'll turn the call back over to Bob to discuss our outlook for the third quarter of fiscal '14. Robert P. Rozek: Thanks a lot, Gregg. As we mentioned, our new orders during the quarter were somewhat choppy, given the strength of October, however we enter the third quarter with a solid backlog. Some of the choppiness that we saw in the second quarter, we expect to continue through the year-end holiday months where new orders are not only expected to be seasonally weaker. But consultants also have fewer business days in front of clients to work off confirmed assignments. With the time taken off on the holidays, we expect that there will be somewhere in the range of 6 to 8 less working days in the third quarter versus what we saw in Q2. To start the third quarter, our November new orders were down relative to October but in line with our expectation. Assuming worldwide economic conditions, financial markets and foreign exchange rates remain steady. Fiscal '14 third quarter fee revenue is likely to range from $221 million to $237 million. And diluted earnings per share are likely to range from $0.30 to $0.38 per share. With that, I'll conclude our prepared remarks, and we would be glad to answer any questions you may have.

[Operator Instructions] Your first question comes from the line of Kevin McVeigh from Macquarie. Kevin D. McVeigh - Macquarie Research: Gary, is the LTC kind of business represent -- obviously a larger percentage of revenue? How are we thinking about that within the organization culturally versus the traditional businesses? Have they kind of become more intertwined, #1 internally than just from a client-facing perspective? Has that change your go-to-market strategies as this has obviously become a more meaningful part of the business overall? Gary D. Burnison: Well, we're going to continue to evolve our organization, but only at a pace that our culture will allow it to absorb itself. So we're going to blur the lines over the next few months, the next several quarters to be one Korn/Ferry. And so our go-to-market strategy is, first, starts with the precedents of our industries, our markets, and it cascades from there as 1 Korn/Ferry. So to put it simply, we're going to blur the lines and represent one face to our clients. And that's what we're doing today. Kevin D. McVeigh - Macquarie Research: And as you think about kind of variable compensation relative to that, is there any change in the comp plans just as a result to kind of cross-selling or anything like that? Gary D. Burnison: All of our colleagues are rewarded on the -- not only what they produce but how they produce it. And that commercial contribution piece includes all of our solutions. So it really doesn't make any difference if somebody delivers a succession planning engagement or delivers on on-boarding or a leadership development or a search. It's all a commercial contribution to the firm. Kevin D. McVeigh - Macquarie Research: Got it. And then just in terms to the guidance. The guidance looks pretty good relative to the loss days around the holidays, things like that. Anything based on assumptions from a macro perspective? We're feeling that as if we've turned the quarter here in Europe in particular. Or are there any kind of regency you'd really highlight, just an expectations perspective, it's driving some of these newfound momentum or continued momentum, rather, for that matter? Gary D. Burnison: Well, no, I mean, as I've said for a long time, this is a Nike solution. That's what it is. And I think it's slow and steady. The cycle is now almost 5 years, believe it or not, where there's positive growth, many Americans don't feel rush [ph] it. Many people in Western economies don't feel like there's been a recovery, but we're mindful of that. We're mindful of the talks around tapering and the like. But I think that this is -- it's slow and steady and it's -- this is a great environment. And you just got to -- the difference between 3% growth and 5% growth is night and day. And that's what our clients are looking for in leaders, people that can deliver that difference and grow. Kevin D. McVeigh - Macquarie Research: Got it. And then just particularly, if I could, and then I'll jump back in. We're in the financial services practice, we're kind of probably getting to the end of the year where you're having discussions with your clients about engagements into January. Any sense of the type of engagements? Or are they kind of more pro-revenue as opposed to compliance? Or just any thoughts on the type of engagements particularly in financial services? Gary D. Burnison: Well, I think it's, again, the trends have continued the focus on risks and compliance hasn't been as great. Broad-based, there's obviously a couple of institutions where it's been huge, but broad-based going back a couple of years, that was increasing part of that business. But I think even within financial services, it's slow and steady.

Your next question comes from the line of Tim McHugh from William Blair & Company. Timothy McHugh - William Blair & Company L.L.C., Research Division: I guess, first, I wanted to ask about the leadership consultant -- I'm sorry, the Futurestep. Can you help quantify it all for us the size of those? You talked about a number of large RPO wins. I guess, we can make an assumption about, call it, $15,000 or $20,000 per professional that you're searching for. But I guess, is that a fair way to think about it? Or what's the scope of those wins? And then, I guess, how long is the upfront initial investment before we can see those margins return to the level? Gary D. Burnison: Our leader, Bern Maloney, and others in that business, I think, would tell you that the margins will return this quarter. And we certainly hope so. We're counting on that. We've invested quite heavily in intellectual property and technology, We've got a great team, and these wins are multimillion dollar wins that stretch over several years. And the gating factor is not only is the upfront setup but it's also our clients in terms of how quickly they want to move in terms of filling some of these positions that, as you rightly said, some of these contracts are in the hundreds, if not thousands, of positions. And so there's really 2 parts to that margin erosion in the quarter. One is the startup set up. The other is the cadence from our clients, so they both impacted us. Timothy McHugh - William Blair & Company L.L.C., Research Division: Okay. And then is there a way to think about the size of that instead of -- I know it depends a little bit on how quickly people want to. Gary D. Burnison: I won't do something off the cuff. Why don't I -- the next call, I do think that it would be appropriate for us to start to quantify for you the dollar backlog in that business because that's how we're starting to really look at it. Now that this business has really scale, we're actually looking at it internally based on contract value, backlog. And so I don't want to throw out any kind of numbers without making sure we've gone through them carefully. So we will start to do that for you, I think that's a fair question. Timothy McHugh - William Blair & Company L.L.C., Research Division: Okay. And then, on leadership, so what's the next steps at this point in terms of margins and in terms of getting to that next level? Is there additional overhead or IT-related investments? Or is it more about driving productivity and leverage in the model at this point? Gary D. Burnison: Well, there's still solutions that we're looking for. There's still some depth and scale that we would like to add to that business, number one. The business now is over $250 million. That's a big leap from where it was 7 years ago. We've obviously see that as a multi-hundred million dollar opportunity depending on economic conditions. I think that the real leverage point is quite simply that this firm going to market is: one, the search business that we have is incredible, and it affords enormous access. And we have to continue to blend those along with Futurestep and be one Korn/Ferry. And I think that is a huge, huge leverage point for us. And the other that Bob can speak to that he's leading is on the technology and process and systems side. Robert P. Rozek: Yes, as we've talked on the prior calls, Tim, We're in the process of putting some HR systems into place as well as consolidating general ledger, so there'll be some additional costings. I think the majority of the productivity that we'll see in terms of margin enhancement is really going to be more along the lines of what Gary just spoke about. It's the bringing Korn/Ferry to market as one and leveraging what we call a typical bearer [ph], our search practice to drive that business. And we just get more dollar across a pretty stable cost base. Timothy McHugh - William Blair & Company L.L.C., Research Division: Okay. And then, I guess, one last one just -- I think Bob, the interest income this quarter, I guess, I know you haven't covered this for a while. Every now and then, that pops up because of deferred comp plans and some other items. But what was it, I guess, this quarter? And was there any offset to that in terms of the above the operating margin line? Just trying to get a sense of how much of that is unusual versus... Robert P. Rozek: Yes, if you look at our deferred comp revenue e-cap program, you go down to our other income line item, it's about $4.4 million of positive effect down below. Of top in compensation, we had about $3.3 million negative effect, so the net impact of that e-cap program is about $1.1 million.

Your next question comes from the line of Tobey Sommer from SunTrust. Tobey Sommer - SunTrust Robinson Humphrey, Inc., Research Division: I was curious about what your trends were like in executive search in November? I guess, you said new search confirmations up low double digits in the quarter itself to November, so you're kind of consistent trends compared to that? Gary D. Burnison: Yes. We had a really -- as we said a really strong month of October. November was back down to level that we have been experiencing relatively consistently over the past 4, 5, 6 months prior to October. September was a little bit light, but November was, in line, exactly what we expected. Tobey Sommer - SunTrust Robinson Humphrey, Inc., Research Division: Okay. Gary, I wanted to ask you a question about the multiple thousands of jobs that you have in the backlog for Futurestep. I know you mentioned that maybe next quarter or the quarter after, you'll give us a little bit of -- or maybe a dollar figure associated with that backlog. But can you ball park it and bracket it just in terms of growth in maybe a range of percentages about how much of that compared to a year ago? Gary D. Burnison: I don't want to do that, Tobey. I've got to make sure that the go through that. I don't want to say something that's irresponsible. The backlog in that business is up significantly. The contract value is up significantly. And we owe it to you to describe our best estimate of how that backlog should roll out. And I told I just can't -- I should not do that without actually going through it. Tobey Sommer - SunTrust Robinson Humphrey, Inc., Research Division: Fair enough. I don't think it's been asked yet. If it has, I apologize. What would spendable cash at the end of the quarter? Robert P. Rozek: If you look at what we call our investable cash, Tobey, it's $127 million. If you flash it back out of very conservative estimate for working capital, we've been using $100 million, so use that consistently, and that will be down to about $27 million. Tobey Sommer - SunTrust Robinson Humphrey, Inc., Research Division: Got you. Okay. And I'd be remiss if I didn't ask you about your expectations for capital and cash flow deployment where 1.5 years or more into spending some money on acquisitions, building new parts of the business. That appear to be now selling well with some visibility for margin improvement. What do you think now? Do you go back and shop some more? Or are you content with what you own for now? Gary D. Burnison: Well, we're always -- we're thinking about this organization. As you know, the source for leadership around the world, and I think we have to continue to invest in the business. And so we're always looking. Nothing has changed about that, and we're very measured about it. That's our #1 priority is to invest in this business for the long term. Tobey Sommer - SunTrust Robinson Humphrey, Inc., Research Division: I guess, are there opportunities to spend -- are you seeing opportunities that are significant and could maybe lead you to maintain such high capital levels? Or do you have some opportunity to be a little bit more flexible and maybe use that capital for multiple purposes? Gary D. Burnison: Well, I think that we are blessed with a very good balance sheet that we've worked hard to build over the years. And I think we have to be -- we obviously have to be balanced in that. And this quarter, I think our return on capital was 10%. That's not good enough, quite frankly. And it's either a question of the numerator or the denominator. And boy, we're trying to do everything we can on the numerator. And so we do dialogue with our board around that capital allocation. In fact, we'll do it again at the end of January.

Your next question comes from the line of Mark Marcon from Robert W. Baird. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: With regards to the number of consultants on the core Executive Search side, how should we think about that going forward? Gary D. Burnison: Well, we are looking to develop our colleagues very aggressively and to promote from within. And it's the same with investing. We're also looking to augment the talent we have from the outside and then we're going to continue to do that. So we really don't guide out in terms of that headcount number. But I would be surprised if it goes down. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: And I know you're not providing guidance, Gary. But can you just talk about, hey, do we think we're on the order of 5% to 6% type growth going forward? Or do we think that there's an opportunity to further increase just the productivity levels and the billings per consultant? Gary D. Burnison: Well, I would hope that we can differentiate our firm in the marketplace and that all of our client-facing professionals will be able, as we continue to train people, will be able to deliver broaden the conversation with clients around multiple solutions. So we really do believe that now with the intellectual property we have and the solutions we have, there's opportunity on the productivity side for sure. In terms of the headcount additions, we really don't look at it that way. We're in the market to add great people to this company. And we're very, very aggressive about that, and we've been aggressive. And we have to also make sure that we continue to develop and train our colleagues here, so there's a lifetime career destination. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: And how should we think about that November comps on a year-over-year basis? Gary D. Burnison: Well, let me see, Bob or Gregg, you guys have that? Robert P. Rozek: They're really in the flattish range, Mark. They're about the same, slight -- flat to slightly up in, let's say, November comp for the executive search relative to the same point last year. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: Okay, great. And then as it relates to L&TC, can you talk a little -- you did have a lot of success in terms of ramping up the growth there. Can you talk about the types of projects that you're seeing the strongest success in? Gary D. Burnison: It's really across a variety. It's leadership development, developing teams, developing employees is certainly a big part of that, assessing talent. Leaders that can make a difference between 3%, 5% growth, that's a big part of that. We have also a great succession planning offering that's obviously linked to talent management that is gaining a lot of traction in the marketplace. And it's things like that, it's tools like learning agility, trying to really develop a workforce to meet the challenges of this next decade. We've got a products business that's been very good as well. So you apply those 4 or 5 categories with the big headline. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: Okay. And it's evenly spread between those? Gary D. Burnison: Again, yes. I mean, there's not one single thing that sticks out. But I'll tell you that one single thing we are seeing is the cohesiveness and the integration going to market as one. That's really -- that's where all the leverage lies for this organization. We just have -- we have a lot of clients. And for a lot of those clients, we do one thing for. And that's just not -- that doesn't make any sense. That's where the opportunity is for us as a company. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: And it sounds like you're seeing greater levels of, I don't want to say cross-selling, but appreciation by your clients of the various options that you can provide and that you're seeing more instances where your clients are using you for more than one service. Gary D. Burnison: We are. Absolutely, are. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: Can you just talk a little bit about just on the L&TC side? You had such a big step function. Clearly, all the business didn't start on the first day of the last quarter. How should we think about the growth in L&TC going forward? Robert P. Rozek: Mark, this is Bob. When you go into the third quarter, as I mentioned, the business that's probably most affected by the holidays is going to be L&TC business because we just don't have the number of working days in the third quarter that we had in the second quarter. Second quarter, we had about 65 days. In the third quarter, there's some scheduling perspective. We've got about 60 days. Although a lot of that also depends on our clients in how they take time off around the holidays. That's why we're estimating what we talked before about being down some 6 to 8 days. We think that, that's going to impact that business the most significantly. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: Okay. Well, how would you describe just kind of the -- on the pro-forma basis kind of the year-over-year growth that you're seeing here? Gary D. Burnison: Well, what we said on the last call and what we're holding the leadership team, too, is if we don't see 10% CAGR in that business, we're going to be disappointed. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: And how should we think about the tax rate going forward? Robert P. Rozek: 35%. Mark S. Marcon - Robert W. Baird & Co. Incorporated, Research Division: 35%, great.

Your next question comes from the line of Ty Govatos from TG Research.

Technical question, what was the bonus accrual for the quarter and 6 months?

It's about -- Ty, it's up $37 million in the second quarter and about $67.5 million year-to-date.

Okay, thanks. And, Gary, I guess, everybody's asked this question so far from different points. But the revenues per consultant or search consultant are substantially higher than they were 10 years ago, you've noted concerted effort to kind of upgrade the consultants over that period of time. And I know it's a gradual process. But how much to that increase, let's say, if we look at that over a 10-year period, average to average, is now the leadership business versus a different type of consultant? Gary D. Burnison: Over a 10-year -- I mean, if I just go back to when Paul started, when I started over a 12-year perspective, I would say, it's 80% people, 20% solutions. Over the last 3 or 4 years, I think that's changed dramatically. And now that we've added really depth and breadth and we're training people and all that, that algebra it's not going to 180. No, it's not flipped entirely, but boy, it's a lot different than 80-20. I'll tell you that.

So you feel comfortable more of the 50-50 mix now? Gary D. Burnison: I do. And I think that, that over the long term for us, delivering more value to clients, more stickier relationships, differentiated platform. We're in the talent business, every clients in the talent business. I do think that there's opportunity there.

Are there some changes, organizational changes, you can make further down the road once you're well past all these integrations and everything that would accelerate or make that process more cohesive in terms of penetrating clients? Gary D. Burnison: Well, I think that the -- clearly, the organizational structure is going to continue to evolve over time that our pace at our culture will absorb. That's absolutely going to change and everything from us, it starts with outside in, what clients are looking for. And they're really looking for sector expertise around talent and knowledge and intellectual property. And so that's where we begin and that's what drives our go-to-market strategy. I will say that under -- in Europe, we have brought the leadership under one individual, one team. And that's definitely a interesting move, and we're going to continue to evolve this. But regardless of the structure, you have to start outside in what the clients are really asking for. And right now we have to continue to develop our people and broaden the conversation with our clients.

And it appears there are no further questions, Mr. Burnison. Gary D. Burnison: Well, okay. Thank you. I certainly am very, very proud of this company. We're in an interesting environment where global growth is slow, but change is fast. And our clients, leaders have to think and act very differently. The differences between above average and new normal are not trivial. I think Korn/Ferry is absolutely positioned for this era. And we're excited about the future. We thank our shareholders and certainly, I would be remiss if not saying this: Have a wonderful holiday, if we don't speak to you, and season’s greetings. Thank you very much.

Ladies and gentlemen, this conference call will be available for replay for 1 week starting today at 7 p.m. Eastern Time, running through December 11 at midnight. You may access the AT&T Executive Playback service by dialing 1 (800) 475-6701 and entering the access code 310913. 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 your conference for today. Thank you for your participation and for using AT&T Executive TeleConference. You may now disconnect.