Letter to Stockholders

Harold M. Messmer, Jr. Executive Chairman
M. Keith  Waddell President and Chief Executive Officer

To Our Stockholders,

2020 was a year unlike any other, and our business quickly adapted to the resulting challenges. We prioritized the health and safety of our employees and engagement professionals by quickly transitioning to a remote work infrastructure. Despite these unprecedented times, our workforce helped our clients manage their businesses and our job candidates find rewarding work. We remained both cost-disciplined and adaptive. We applaud our dedicated employees for their agility, persistence and resilience throughout this time. As we look ahead, we are encouraged by the passion and commitment of our leaders and employees.

While the impact of COVID-19 on the global economy and labor market adversely affected our results, particularly during the second and third quarters, we began to meaningfully recover by year-end.

Full-year global revenues were $5.1 billion, a decrease of 16 percent from $6.1 billion in 2019. U.S. revenues decreased by 15 percent to $4.0 billion. International revenues decreased by 18 percent to $1.1 billion compared with 2019 and accounted for 22 percent of the company total.

Protiviti, our global business consulting subsidiary, performed particularly well, demonstrating resiliency, growth and accelerated integration with our staffing divisions. Full-year revenues of $1.3 billion grew by 12 percent compared to 2019. In the fourth quarter alone, Protiviti revenues increased 19 percent, to $362 million, over the fourth quarter of 2019. As of the end of 2020, this business had registered 13 consecutive quarters of year-over-year revenue growth and represented 25 percent of total annual revenue.

Net income was $306 million, or $2.70 per share, on revenues of $5.1 billion. This compares to net income of $454 million, or $3.90 per share, on revenues of $6.1 billion in 2019.

Despite the pandemic headwinds, our 2020 cash flow remained strong as we converted receivables to cash at a rate consistent with pre-COVID times. This allowed us to continue driving our capital allocation strategy forward. We increased our dividend for 2020, totaling $1.36 per share for the year or total cash outlay of $156 million. We also resumed share repurchases in the third quarter after a brief pause during the second quarter. We then renewed our share repurchase plan, authorizing the repurchase of an additional 10 million shares. Return on invested capital for the year was 26 percent.


Now more than ever, we believe the strength of our brands, people, technology and professional business model positions us for future success.

Robert Half’s personalized service delivered by our passionate employees is the backbone of the enterprise. Our workforce is well-tenured and focused on increasing productivity as we move through 2021. Our cycle-tested management team has a strong track record of navigating through economic downturns and into recoveries.


Given the transition to remote work, our multiyear digital transformation accelerated, bolstered by our deep experience with technology solutions, proven methodology and expertise. Our people and platforms showed critical agility in how we were able to transition to remote operations, all while maintaining our high levels of client service and support.

Our technology investments improved our client and candidate interaction experience, making it easier to hire or be hired and providing our customers with choice. Our advanced AI-driven technology capabilities provided clients with real-time choices of candidates from inside and outside their local market area. As of this writing, we are the No. 1-ranked talent and staffing app in both the Apple and Google app stores. We improved our customer-facing web experience, and our talent acquisition strategies helped our staffing professionals make better matches and be more productive.


Today’s labor market is more intricate and nuanced than ever before. We are in the midst of a global health crisis, a technological revolution and an increasing focus on sustainability, all of which are moving the job market in new directions.

Our core staffing business has a long history of navigating complex economic cycles, and recent events have proved to be no different. Our traditional small-business client base is poised to participate in any early-cycle recovery, which has long been a significant source of growth for the company.

Protiviti has significantly expanded its capabilities to a balanced suite of service offerings that includes technology consulting, internal audit and financial advisory, regulatory compliance remediation and transformation, and business performance improvement. This diversified portfolio of solution offerings provides the foundation for multiple avenues of additional growth.

We are seeing more firms utilize a combination of integrated consulting services and talent support. Accordingly, we are experiencing heightened demand for our Protiviti and Robert Half managed solutions. By offering expert consulting capabilities along with our deep, geographically diverse talent pool, our solutions are as nimble as the companies that solicit them. These offerings have enabled better integration with our staffing solutions, creating a compelling value proposition and facilitating entry into new markets. The collaboration between Protiviti and staffing is at an all-time high, and we believe this offering is unique in today’s marketplace and will be a high-potential growth opportunity going forward.

Because of our long operating history, new technology innovations, vast candidate pool and joint offerings with Protiviti, we have expanded our client portfolio to many more midsize and large clients. Our aggressive go-to-market strategy with clients in the public sector and financial institutions of all sizes has also yielded meaningful wins and new relationships. As a result, our mid and large-cap client base as a percentage of total revenues has increased to over 30 percent as of the end of the year.


We face 2021 with renewed optimism. Our key staff are committed to driving the continued success of our enterprise. We expect our ongoing investments in growth opportunities and technology innovation will accelerate performance once pandemic conditions subside.

Fundamentals improved during the second half of 2020, and most economists expect this to accelerate into 2021. As business conditions improve, our clients will be entering one of the best labor markets in recent memory. We will be well-positioned to help them with pent-up project demand and increasing transaction volumes as well as upskilling staff where needed, including out-of-market remote resources.

Our strategic staffing consultants can and will help clients of all sizes plan ahead and understand how to shape their future talent needs. Protiviti’s pipeline remains strong across each of its solution areas, and its future is bright.

Ultimately our brands are among the strongest, most recognized and respected across both the staffing and consulting industries. Our balance sheet remains rock solid and has positioned us for future success. Our people are among the most driven and resourceful in the industry. Their dedication to serving our customers and their businesses and sparking innovation is unwavering.

We sincerely thank our dedicated employees, directors, business partners and you, our loyal stockholders, for continuing to support our promising mission. Here’s to a healthy 2021.

Respectfully submitted,

Max Messmer Signature

Harold M. Messmer, Jr.

Executive Chairman

March 24, 2021

Keith Waddell Signature

M. Keith Waddell

President and

Chief Executive Officer

March 24, 2021