Sarbanes-Oxley accounting reform helped Resources Connection Inc. report sales and earnings growth in its quarter ended Feb. 28.
The provider of auditing and other financial-related employees said Tuesday that revenue in the quarter ended Feb. 28 jumped 54% to $135 million,in line with Wall Street expectations, according to a survey by Thomson Financial.
The Costa Mesa-based company’s net income, which more than doubled to $13 million in the period, fell short of expectations by about 7%, according to Thomson Financial. The company said some slowdown in work around the winter holidays impacted results.
Resources Connection has seen demand spike for its accounting services in the wake of Sarbanes-Oxley accounting reform.
The 2002 legislation requires publicly traded companies to report more details about their accounting procedures and controls, and it prevents accounting firms from offering both auditing and other accounting services at the same time,a development that Resources Connection said it’s taken advantage of.
“We continue to see strong demand for our diversified services and will pursue our expansion as clients depend on our ability and global expertise to support their critical internal consulting needs,” said Chairman and Chief Executive Donald Murray, in a release.
During a conference call after the earnings release, Resources Connection said it sees revenue and earnings growing 20% to 30% in the next few years.
Shares of Resources Connection were down 3% to $22.4 in after-hours trading. The company released its earnings results after the markets closed Tuesday.
During the quarter, the company changed the name of its primary operating unit to Resources Global Professionals. The company opened offices in Paris and Calgary during the period.
