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HRoot global 50 hr service providers rankings and whitepaper 2012
1. GLOBAL 50 HR SERVICE PROVIDERS
RANKINGS AND WHITEPAPER 2012
Released by HRoot, Sept. 2012
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2. Executive Summary GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Maneuvering the Future
A Vision Statement of the Global HR Service Market in 2011-2012
2011, a year of progress against odds
Given the devastation of the European debt crisis, the world
economic growth saw a significant slowdown in 2011. Most European
countries suffered a plight of negative growth, while emerging
economies, however, continued to maintain a high growth momentum,
and proved to the powerhouses of global economic growth.
Just as IMF pointed out in the latest "World Economic Outlook"
report, the global economy is in a dangerous phase, and downside
risks increase sharply. In 2012, mainly due to the recession of the euro
zone, the global economy is still in dire straits and the growth rate will
slow down to 3.25%. High unemployment rate is still an important risk
of the global economic recovery, and to compound the problem, the
Corporate earnings of Global 50 HR Service
economic growth of Chinese is also losing momentum.
Providers in fiscal 2011(operating profit) Although the global economy is still problem ridden, the human
resources service industry is progressing in leaps and bounds, which
can be seen from the list of Global 50 Human Resource Providers
8% 2012. In the Global 50 list in 2011, 11 registered negative growth in
10%
Profit-making their annual revenue. By contrast, all the companies on this year's
82% Loss-making list have reported revenue growth in this full fiscal year. Particularly,
the revenue increase of LinkedIn and Aon Hewitt in this fiscal year hit
Others
114.8% and 113.2%. It is worth mentioning that recruitment services
accounted for 50% of the total operating revenue of LinkedIn in fiscal
2011. In addition, in the first quarter of 2012, LinkedIn raked in $103
million in its recruitment business, which accounts for 54% of its total
revenue of $189 million dollars, a rate higher than the minimum rate of
Corporate earnings of Global 50 HR
50% as per the condition of the list were, hence we include it in the
Service Providers in fiscal 2011(net profit) list as an online recruitment company. In addition, as the only Chinese
company that has muscled its way into top ten, the CIIC still maintains
4%
8% high performance, with a strong growth rate of over 33.4%, and is
Profit-making ranked as the 8th.
In terms of profit, last year 35 of the Global 50 companies were
88% Loss-making
profitable while 14 were in the red. While in this year’s Global 50,
Others however, 44 enterprises have turned up profits. Among them, 41
companies have achieved net profits. In sum, the human resources
service market has seen remarkable increase this year.
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3. Executive Summary GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Cheers and Tears
Mirroring the global economic turmoil, the Global SAP in December 2011; Taleo Corporation was taken over
50 2012 also highlights the quirky changes in the human by ORACLE in February 2012. The 104 Job Bank, which
resources service industry. SFN Group, which ranked the appeared in last year’s Global 50 list, was ranked 51th this
12th in the Global 50 list in 2011 was acquired in September year, thus having lost its position in the rankings list, and
2011 by Randstad, while SuccessFactors was claimed by the naive company ATA was also flunked out.
Table 1: Former Global 50 companies absent from the “HRoot Global 50 HR Service Providers 2012”
Rank in 2011 Company Country Main business Reason
12 SFN Group USA Talent dispatch/lease/placement Being acquired
34 Taleo Corporation USA HR management software Being acquired
36 SuccessFactors USA HR management software Being acquired
44 104 Job Bank China Online recruitment Revenue unqualified
46 Fortune Industries USA HR service outsourcing Revenue unqualified
47 Hamilton James & Bruce Australia Headhunting & RPO Revenue unqualified
49 ATA China Talent assessment & test Revenue unqualified
48 DLH Holdings USA HR service outsourcing Revenue unqualified
50 Workstream Canada HR management software Revenue unqualified
Table 2 New comers of the “HRoot Global 50 HR Service Providers 2012”
Revenue in Fiscal
Rank in 2012 Company Country Main business
2011（$ million）
12 Temp Holdings Japan HR service outsourcing 3,032
13 Pasona Group Japan Talent dispatch/ lease/placement 2,324
16 Synergie SA France Headhunting & RPO 1,875
19 TrueBlue USA Talent dispatch/lease/placement 1,316
25 Meitec Corporation Japan Headhunting & RPO 870
28 Robert Walters UK Headhunting & RPO 820
34 LinkedIn USA Online recruitment 522
35 Fullcast Holdings Japan HR service outsourcing 446
36 Corporate Resource Services USA Talent dispatch/lease/placement 345
46 HRnetOne Group Singapore Headhunting & RPO 203
48 The ReThink Group UK HR service outsourcing 123
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4. Executive Summary GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Making its debut in the list, LinkedIn, an American register much higher traffic than traditional websites. The
networking site, is remarkable for its performance. This latest financial results shows that Monster posted $237
business networking site, created in the United States million in revenue in Q2 2012, down 12.2% compared with
in 2002, aims to provide a platform for user to network $270 million in the same period last year. Among the amount,
and maintain personal connections, as well as to provide the recruitment revenue fell by 8% to $217 million, compared
recruitment solutions and customer information service. with $236 million in the same period last year. By contrast,
With the growing number of its users, it has become the LinkedIn reported total revenue of $228.2 million in Q2 2012,
main channel of the U.S. corporate recruitment. According an increase of 89% compared with $121 million in Q1 last
to the LinkedIn official data disclosure, all the Fortune Global year. Revenue from recruitment business reached $121.6
500 companies are using LinkedIn to recruit, or 100% of million, an increase of 107% over Q2 last year. In the face of
the Fortune Global 500 companies are using social media the robust development of social recruitment, Monster has to
recruitment. LinkedIn has more than 2.24 million registered reconsider its strategic alternative, and it has adopted social
users, while the number of users in the US is close to 65 media to revive its recruitment business.
million. In fiscal 2011, LinkedIn’s Revenue topped $522.2 The top three players, Adecco, ManpowerGroup, and
million, posting an annual growth of 114.8%, while its profits Randstad continue to dominate the market. Adecco registered
grew by 32%, which makes LinkedIn the fastest growing a revenue growth rate of 15.1%, retaining its leadership in
company in the market of corporate recruitment and notches the pack. Randstad, with a 19.6% increase in its revenue,
it to the 34th place on the list. returned to the second place this year. ManpowerGroup fell
The rise of social networking sites has caused a huge to the third, but in terms of operating profit and operating
impact on the traditional recruitment websites. Compared margin, it has still outperformed Randstad. It is worth
with traditional recruitment sites, social networking sites mentioning that Randstad and ManpowerGroup muscled
their way back to the Fortune Global 500 ranking. With
revenues of $22.56 billion and $22.006 billion, they are ranked
2010-2012 LinkedIn Revenue Composition
the 489th and the 500th respectively. So far, the top three
human resource services have all made a comeback to the
list, a testimony to the strong growth momentum of human
resources service in an economic malaise.
A study of the Global 50 rankings will suggest the robust
growth of HR outsourcing and online recruitment. Among
the top 20 fastest-growing companies, nine are human
resources outsourcing service providers and three are doing
online recruitment. As it is illustrated in a research by the
Global Industry Analysts, cost reduction fueled the increase
of HR outsourcing business, especially in the outsourcing of
payroll management. For enterprises, cost cut appears all the
2009-2011Recruitment Revenue of LinkedIn more important in an era of worldwide recession. Human
(million dollars) resources outsourcing market will continues to grow, and
will pull in $162 billion in revenue by 2015. In this year’s
rankings, Paychex and ADP post operating margins up to
38.3% and 19.6%, securing their the leading positions in
the field of human resources outsourcing. At the same time,
social networking sites are changing the marketing models of
recruitment and headhunting, while the business and product
models are undergoing dramatic changes. In the Global 50
list, LinkedIn ranked first in terms of revenue growth, and its
recruitment business jumped by as much as 54%; the impact
of SNS on traditional recruitment is evident.
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5. Executive Summary GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Economic crisis gives rise to M&A opportunities
“Every cloud has a silver lining” The economic M&A is riding on the rising tide. It is worth mentioning
meltdown has admittedly wrecked havoc to the world, that the SaaS service model based on cloud computing
yet at the same time, the debt crisis in Europe has also technology is changing the competitive landscape of the
led to a significant reduction in the cost of mergers human resources software industry.
and acquisitions (M&A), and has provided once-in- In the face of the tremendous opportunities cloud
a-lifetime opportunities for inter-enterprise mergers computing brings, SAP shelled out $3.4 billion in its
and acquisitions. Therefore, those who can seize acquisition of SuccessFactors. Oracle, a competitor of
opportunities, and take actions at appropriate time may SAP, in order to strengthen its advantages in the market,
stand the chance to change the position of enterprises in acquired talent management cloud service provider Taleo,
the market competition. The global economic slowdown for the price of $1.9 billion in February 2012. Oracle’s
has not slowed down mergers and acquisitions between acquisition of Taleo was considered a counter move of
HR service company, on the contrary, many HR service SAP’s acquisition case, which highlights the increasingly
companies want to enter new geographical reach and intense competition in the human resources software
to accelerate business growth through mergers and industry.
acquisitions. As a result, the human resources industry
Table 3 Major M&A events in HR service market, 2011-2012 (selections)
Time Event
1/2011 Towers Watson acquired EMB, a property and medical services consulting and software company.
2/2011 Chandler Macleod acquired over 90% of the equity of Ross Human Directions Limited.
ManpowerGroup and the Ministry of Industry and Information Technology of the People's Republic of
3/2011
China Talent Exchange Center jointly established a joint venture of iTecPower.
4/2011 ManpowerGroup acquired ReachHR, a Guangzhou-based HR service company.
5/2011 Paychex acquired Plan Services, following its acquisition of SurePayroll in December 2010.
On Sept. 5, Randstad Group announced its successful acquisition of SFN Group, for approximately $771
9/2011
million.
SAP announced the acquisition of HR software maker SuccessFactors for $3.4 billion, a move to expand
12/2011
the company's cloud computing business. The acquisition was completed in February 2012.
ADP acquired the payroll management business of Ma Foi Randstad, a branch company of Randstad
1/2012
based in India
2/2012 ORALE agreed to acquire the online recruitment software provider Taleo for about $1.9 billion
2/2012 Kenexa acquired OutStart, a Boston-based software company.
3/2012 ADP acquired the human resources solutions sector of SHPS.
4/2012. Kronos acquired the SME workforce management company SaaShr.com.
4/2012 Kronos acquired the workforce management solution provider SMART.
5/2012 LinkedIn agreed to acquire the career information sharing community SlideShare for $118.75 million.
5/2012 Towers Watson acquired the medical health services company Extend Health.
7/2012 Harvey Nash Group acquired Talent-IT BVBA.
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6. Executive Summary GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
The Global 50 rankings introduce the concept of DuPont analysis and the comparison of the results of the enterprises’
analysis for the first time. The DuPont analysis, named after the operations. By intrinsically bringing together a number of ratios
American company that first used it, comprehensively analyzes the that reflect the efficiency and financial conditions of a business,
financial conditions of enterprises by examining the relationship it forms a comprehensive index system, and ultimately reflects
between several major financial ratios. From a financial point of the consolidated net assets yield. While compiling this year’s
view, this is a classical tool to evaluate a company's profitability rankings, we have selected ten indicators on four dimensions to
and return on shareholders’ equity. Its underlying methodology make the comparison and to probe into the operating conditions of
is to break down net assets progressively into a number of various HR service providers.
financial ratios that are to be multiplied. This helps the in-depth
Table 4 Financial analysis indicators used in the “HRoot Global 50 HR Service Providers 2012”
Competence indicator Financial ratio Formula
Annual revenue growth rate (Current revenue - on revenue) / on revenue
Total asset turnover ratio Revenue / average total assets
Operating capacity
Accounts receivable turnover ratio Revenue / average accounts receivable balance
Return on assets (ROA) Net profit/average total assets
Operating margin Operating profit/revenue
Profitability Net profit margin Net profit/main business income
Return on shareholder’s equity (ROE) Net profit/shareholders' equity
Financial structure Debt-asset ratio Liabilities/total assets
Current ratio Current assets/current liabilities
Solvency
Times interest earned(TIE) EBIT/interest expense
First of all, we compare the four indicators of revenue the stronger the long-term solvency of the enterprise is. A note-
growth rate, total asset turnover ratio, accounts receivable worthy fact is that among the top ten HR service providers, eight
turnover ratio, and return on assets. Among them the annual of them post higher debt-asset ratios than the industry average.
revenue growth reflects the increase or decrease in revenues. However, this does not mean that the long-term solvencies of
The total asset turnover ratio reflects the capacity of operating these companies are weak, but suggests that these enterprises
the assets of the enterprise as a whole. In general, the faster have the ability to leverage strong.
the total asset turnover is, the stronger its operating capacity is. Finally, the liquidity ratio and the interest earned multiples
Accounts receivable turnover ratio is the average number of times reflect the solvencies of the enterprises. Among them liquidity
a company's accounts receivable turn into cash within a certain ratio suggests the company's short-term solvencies, while the
period. In general, the higher the accounts receivable turnover multiple of the interest earned is used to measure the long-term
ratio is, the faster its capital flows, the stronger the corporate solvency of the enterprise. In general, the higher the interest
solvency is. In the Global 50 rankings, LinkedIn and Aon Hewitt earned multiple enterprise, the stronger the long-term solvency
boast unusual growth rate of 114.8% and 113.2%, which justify is. In the rankings, ADP and CIIC, with the interest earned
their positions as the fastest growing companies. CIIC’s total multiples of 225.7 and 112.2, are ranked as companies with the
asset turnover ratio reached 8.4, second only to the 11.4 of strongest long-term solvencies.
the Corporate Resource Services company, while its accounts In addition, the Global 50 rankings also introduce the concept
receivable turnover ratio hit a whopping 152.2, testifying to the of industry average, a benchmark of of respective industries of
industry-leading operational competence of the company. HR services. This approach can be more intuitive and objective
Secondly, the three indicators of operating margin, net profit for investors to judge the overall level of the financial condition of
margin, and return on shareholders’ equity (ROE) reflect the various HR service providers, revealing the risks and the room of
profitability of enterprises. Among them, the ROE reflects the growth they have. In the rankings, respective industry averages
ability of generating profit on shareholders’ investment, and are worked out from the categories of the 59 companies fall
the efficiency of corporate financing and operating activities, and in, i.e., human resources outsourcing, talent dispatch / leasing
it is the most important indicator of the DuPont analysis. The / placement services, headhunting services and recruitment
Japanese company Fullcast Holdings ranked first with a ROE process outsourcing, HR consulting, talent management
of 22.2%, while 51job ranked second with 17.6%. In addition, software, online recruitment. The financial data are grouped as
from the perspective of industry segmentation, human resources per the different categories, and a composite score is worked out
outsourcing, headhunting services and recruitment process by comparative analysis of indicators with the industry average,
outsourcing all generate higher ROE than average. and their financial status are graded to reflect the profitability of
Thirdly, the debt-asset ratio indicates how much percentage the enterprises in their respective industry.
of total assets are raised through borrowing. The smaller the ratio, Meanwhile, as to the exchange rates, this year’s rankings,
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7. Executive Summary GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Table 5 Financial ratios averages by industry in the “HRoot Global 50 HR Service Providers 2012”
Industry Talent dispatch HR
HR service Headhunting & HR Online
/ lease / management
Financial ratio outsourcing RPO consulting recruitment
placement software
Annual revenue growth rate 16.40% 20.90% 18.50% 41.90% 23.90% 37.40%
Total asset turnover ratio 2.9 3.6 2.4 0.9 0.9 0.7
Accounts receivable turnover
21.6 11.9 5.8 5.3 4.4 11.9
ratio
Return on assets 5.60% 3.80% 4.00% 4.60% -8.90% 9.70%
Operating margin 6.00% 3.00% 3.90% 9.70% -1.60% 19.00%
Net profit margin 4.20% 1.70% 2.00% 5.30% -10.90% 15.80%
ROE 11.90% 3.30% 8.30% 7.10% -13.20% 13.70%
Debt-asset ratio 59.00% 53.90% 42.30% 35.50% 51.90% 35.70%
Current ratio 1.3 1.7 2.1 2.6 1.6 2.3
Times interest earned 59.8 15.6 38.3 79.6 21.2 18.7
unlike previous ones, adopts the annual average exchange rate At the same time, the human resources industry is also showing
between the local currency and the US dollar, a calculating new development trends. Corporate managers need to further
method used by the ranking of Fortune Global 500 that converts create sound working environment for employees to deliver high
the annual revenue of enterprises of other currencies into U.S. performances and maximize their full potentials. Enterprises
dollars and then rank them. This algorithm excludes the influence should elevate employees' sense of identification and loyalty to
of fluctuations of interest rate throughout the year on the their enterprises, build sustainable leadership, establish positive
rankings, an effort that can reduces errors and has the whole list interactions between employees and enterprises, so that to
reflect the development trend of the human resources industry. obtain sustainable development prospects. Therefore, the human
In the year ahead, the world economy will be even more resources service providers must make plans ahead of time, seize
complicated and grimmer with added instability and uncertainty, opportunities for their development, enhance internal power of
while the Chinese economy will have more influence on the enterprise development, so as to achieve success in the future
world. Admittedly, China's economic growth rate will slow regardless of the economic turmoil.
down, but it is still the main engine of world economic growth.
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10. HRoot Global 50 Human Resources Service Providers 2012, Sub-Rank Companies GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Ranking Total revenue in Total revenue in Operating profit Operating profit Operating
Rank Rank Annual revenue
higher/ Company Logo Country Main business Fiscal 2011 Fiscal 2010 in Fiscal 2011 in Fiscal 2010 margin in
2011 2010 growth rate
lower ($ million) ($ million) ($ million) ($ million) Fiscal 2011
↓ 51 44 104 Job Bank Online recruitment 80 78 2.3% 9 10 10.9%
HR management
→ 52 / Cornerstone OnDemand 73 44 67.0% -19 -13 -26.4%
software
↓ 53 46 Fortune Industries HR service outsourcing 64 61 6.0% 2 1 2.9%
↓ 54 47 Hamilton James & Bruce Headhunting & RPO 56 49 14.7% 0.4 -3 0.7%
Talent assessment/testing
↓ 55 49 ATA 48 36 34.1% 3 -4 6.9%
service
↓ 56 48 DLH Holdings HR service outsourcing 42 41 2.6% -4 -4 -10.1%
→ 57 / Prime People Headhunting & RPO 20 22 -8.7% 1 2 7.1%
HR management
→ 58 / NetDimensions 12 8 48.2% 1 0.2 4.9%
software
HR management
↓ 59 50 HRsoft 8 10 -23.0% -1 -13 -8.2%
software
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11. GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Former Global 50 companies absent from the “HRoot Global 50 HR Service Providers 2012”
Rank in
Company Country Main business Reason
2011
12 SFN Group Talent dispatch/lease/placement Being acquired
34 Taleo Corporation HR management software Being acquired
36 SuccessFactors HR management software Being acquired
44 104 Job Bank Online recruitment Revenue unqualified
46 Fortune Industries HR service outsourcing Revenue unqualified
47 Hamilton James & Bruce Headhunting & RPO Revenue unqualified
49 ATA Talent assessment & test Revenue unqualified
48 DLH Holdings HR service outsourcing Revenue unqualified
50 Workstream HR management software Revenue unqualified
New comers of the “HRoot Global 50 HR Service Providers 2012”
Rank in Revenue in Fiscal
Company Country Main business
2012 2011（$ million）
12 Temp Holdings HR service outsourcing 3,032
13 Pasona Group Talent dispatch/ lease/placement 2,324
16 Synergie SA Headhunting & RPO 1,875
19 TrueBlue Talent dispatch/ lease/placement 1,316
25 Meitec Corporation Headhunting & RPO 870
28 Robert Walters Headhunting & RPO 820
34 LinkedIn Online recruitment 522
35 Fullcast Holdings HR service outsourcing 446
36 Corporate Resource Services Talent dispatch/lease/placement 345
46 HRnetOne Group Headhunting & RPO 203
48 The ReThink Group HR service outsourcing 123
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12. GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Financial analysis indicators used in the “HRoot Global 50 HR Service Providers 2012”
Competence indicator Financial ratio Formula
Annual revenue growth rate (Current revenue - on revenue) / on revenue
Total asset turnover ratio Revenue / average total assets
Operating capacity
Accounts receivable turnover
Revenue / average accounts receivable balance
ratio
Return on assets (ROA) Net profit/average total assets
Operating margin Operating profit/revenue
Profitability Net profit margin Net profit/main business income
Return on shareholder’s equity
Net profit/shareholders' equity
(ROE)
Financial structure Debt-asset ratio Liabilities/total assets
Current ratio Current assets/current liabilities
Solvency
Times interest earned(TIE) EBIT/interest expense
Financial ratios averages by industry in the “HRoot Global 50 HR Service Providers 2012”
Industry Talent dispatch HR
HR service Headhunting & HR Online
/ lease / management
Financial ratio outsourcing RPO consulting recruitment
placement software
Annual revenue growth rate 16.40% 20.90% 18.50% 41.90% 23.90% 37.40%
Total asset turnover ratio 2.9 3.6 2.4 0.9 0.9 0.7
Accounts receivable turnover
21.6 11.9 5.8 5.3 4.4 11.9
ratio
Return on assets 5.60% 3.80% 4.00% 4.60% -8.90% 9.70%
Operating margin 6.00% 3.00% 3.90% 9.70% -1.60% 19.00%
Net profit margin 4.20% 1.70% 2.00% 5.30% -10.90% 15.80%
ROE 11.90% 3.30% 8.30% 7.10% -13.20% 13.70%
Debt-asset ratio 59.00% 53.90% 42.30% 35.50% 51.90% 35.70%
Current ratio 1.3 1.7 2.1 2.6 1.6 2.3
Times interest earned 59.8 15.6 38.3 79.6 21.2 18.7
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13. GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Notes:
1. Conditions on entrants: The revenues of human resources service providers shall account for over 50% of their revenues, and the
listed companies can provide financial data audited by third-party audits or notarized by the government departments. Therefore, listed
companies such as Oracle, SAP, Kingdee, Yonyou are not presented as as their software business did not generate more than 50%
of their total revenues. DDI, HayGroup, and Career International, are absent from the rankings as they have not gone public or their
financial data are not available, albeit they specialize in human resources services.
2.The data adopted in the ranking come from below sources:
(1) Financial reports of 2011 announced by each listed company;
(2) Financial information of 2011 announced by the stock exchanges where the companies are traded;
(3) The data of unlisted companies are provided by third-party auditors or financial statements approved by the government
departments available to HRoot.
3. The annual financial data in the rankings are divided by the fiscal year involved in the financial reports rather than the calendar year.
4. The rankings take the US dollar as the standard currency. Financial data of non-US companies are converted into US dollars at the
average exchange rate of a whole year ending on the last day of their fiscal years. The exchange rates are listed as follows: GBP1 to
USD1.6039; Euro1 to USD1.3905; AUD1 to USD1.0480; SGD1 to USD0.7952; RMB1 to USD0.1548; HKD1 to USD0.1285, NTD1 to
USD0.0342; JPY1 to USD0.0125.
5. The slash mark, or “/”, means no data.
6. The financial data of Mercer are sourced from the 2011 annual financial report of its parent company, Marsh & McLennan.
7. The financial data of Aon Hewitt refer to the Fiscal 2011 data of the HR solutions business of Aon Corporation.
8. In 2011, LinkedIn generated over 50% of its revenue from its recruitment services and in the first quarter of 2012, its recruitment
service generated $103 million in revenue, accounting for 54% of its total revenue of $189 million. As its revenue of human resources
services accounted for more than 50% of its total revenue, LinkedIn is qualified as an entrant in the rankings.
9. Insperity was formerly named Administaff.
10. DLH Holdings Corp.was formerly named TeamStaff.
11. Monster is the parent company of ChinaHR.com.
12. SEEK is the parent company of zhaopin.com.
13.Total Revenue is the operating income of the companies in the sales of goods or services, and other operations, including the basic
operating revenue and other operating income. It is an important part of corporate cash inflows, the operating results of the enterprise.
Therefore, the rankings refer to the total revenue of the enterprises.
14. The data of industry averages are calculated as per the industry categories the 59 companies fall into, i.e., human resources
outsourcing, talent dispatch/lease/placement services, executive search services, recruitment process outsourcing, human resource
consulting, human resource management software, and online recruitment.
15. Interpretations of financial ratios
Competence indicator Financial ratio Formula
Annual revenue growth rate (Current revenue - on revenue) / on revenue
Total asset turnover ratio Revenue / average total assets
Operating capacity
Accounts receivable turnover ratio Revenue / average accounts receivable balance
ROA (return on assets) Net profit / average total assets
Operating margin Operating profit / Revenue
Profitability Net profit margin Net profit / main business income
ROE, return on shareholder’s equity Net profit / shareholders' equity
Financial structure Debt-asset ratio Liabilities / total assets
Current ratio Current assets / current liabilities
Solvency
TIE (times interest earned) EBIT / interest expense
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14. GLOBAL 50 HUMAN RESOURCES SERVICE PROVIDERS 2012
Notes:
(1) Annual revenue growth rate gauges the ratio of the difference between the revenues of Fiscal 2011 and Fiscal 2010 to the latter. It
illustrates how fast the revenue is changing.
(2) The total asset turnover ratio measures the ability of a company to use its assets to efficiently generate sales. This ratio considers all
assets, current and fixed. Those assets include fixed assets, like plant and equipment, as well as inventory, accounts receivable, as well
as any other current assets. The fast the turnover of a company, the stronger its operating capacity is.
(3) Accounts receivable turnover ratio refers to the number of times that accounts receivable amount is collected throughout the year.
The average accounts receivable looks at the accounts receivable balance at the beginning of the year as well as the end of the year.
A high accounts receivable turnover ratio indicates a tight credit policy. A low or declining accounts receivable turnover ratio indicates a
collection problem, part of which may be due to bad debts. Yet an extremely high ratio can mean that the company is under the heavy
debts that may curb the increase of its sales amount and profit.
(4) ROA, or return on assets, is an indicator of how profitable a company is relative to its total assets. ROA gives an idea as to how
efficient management is at using its assets to generate earnings. Calculated by dividing a company's annual earnings by its total assets,
ROA is displayed as a percentage.
(5) Operating margin is a measure of profitability that indicates how much of each dollar of revenues is left over after both costs of
goods sold and operating expenses are considered.
(6) Net profit margin tells how much profit a company makes for every one dollar. The higher a company's profit margin compared to its
competitors, the better.
(7) ROE, or Return on shareholder’s equity, is the amount of net income returned as a percentage of shareholders equity. Return on
equity measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have
invested.
(8) Debt-asset ratio is total liabilities divided by total assets. The debt asset ratio shows the proportion of a company'sassets which are
financed through debt. Companies with high debt/asset ratios are said to be "highly leveraged," and could be in danger if creditors start
to demand repayment of debt.
(9) Current ratio suggests the company's ability to pay back its short-term liabilities (debt and payables) with its short-term assets (cash,
inventory, receivables). The higher the current ratio, the more capable the company is of paying its obligations.
(10) Multiples of interest earned is a metric used to measure a company's ability to meet its debt obligations. It is calculated by taking
a company's earnings before interest and taxes (EBIT) and dividing it by the total interest payable on bonds and other contractual debt.
It is usually quoted as a ratio and indicates how many times a company can cover its interest charges on a pretax basis. The higher the
TIE, the more ability the company has to pay its long-term debts.
16. The column of “Ranking higher/lower” illustrates with signs, of which an upward arrow means the company ranks higher than
before and a downward arrow means the opposite; a bar means staying unchanged while an arrow pointing right means the company is
a new entrant to the rankings.
17. The national flags in the ranking lists represent the below countries:
USA Australia UK The Netherlands France China
Japan Canada Singapore Israel Switzerland
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