After Heidrick & Struggles posted a large first-quarter loss on Tuesday — and said it would cut more jobs –Â the company’s shares plunged $3.94, or 16.9%, to $19.35 at the close of business.
Earlier in the day, the company said the number of executive searches decreased 38.4% compared to the 2008 first quarter, and decreased 6.8% compared to the 2008 fourth quarter.
In addition to an 11% staff reduction back in January,Â it now plans to lay off nearly 10% next month. It will also cut discretionary bonuses and reduce base salaries by 5%.
L. Kevin Kelly, the company’s CEO, said the following in a statement:
“The negative impact of the global financial crisis and recession is no longer contained to one or two industries. Each of our practice groups and every region experienced double-digit revenue declines in the first quarter. Search confirmations hit a low in December and showed a modest but steady improvement through March. However, the improvement was not as strong as we had anticipated and operating losses in each region were a result of a cost structure that, despite cost-cutting initiatives, was not supported by first quarter revenue.”
Article Continues Below
Guide: Practical Tips for Remote Hiring
Kelly also said he anticipates an improvement in business in the later half of the year.
“But given today’s environment, nothing is certain,” he added.