Hudson Highland Group Announces Revised 2005 Guidance

Dec 22, 2005, 00:00 ET from Hudson Highland Group, Inc.

    NEW YORK, Dec. 22 /PRNewswire-FirstCall/ -- Hudson Highland Group, Inc.
 (Nasdaq:   HHGP), today announced that it has lowered guidance for 2005.
     The company now expects 2005 full-year EBITDA to range from $27 to $30
 million, revised from $30 to $34 million.  The reduction stems from hiring
 demand softness that surfaced during the quarter in Hudson Australia, New
 Zealand and North America.
     Hudson Australia has been adversely affected by hiring freezes from
 certain key clients. Hudson New Zealand has been adversely affected by general
 economic uncertainty, partially from the reaction to the recent election.  In
 local currency, Hudson Australia/New Zealand gross margin was up 4.5 percent
 during the first nine months of 2005 compared with the year ago period, but
 has been down 1.6 percent through the first two months of the fourth quarter.
     Despite good revenue growth overall, Hudson North America experienced
 softer-than-expected demand and contract pricing pressure in the IT and
 Accounting & Finance practice groups.  During the first nine months of 2005,
 revenue was up 39.4 percent compared with the year ago period, and through the
 first two months of the fourth quarter, revenue is up 20.4 percent.
     "I'm disappointed with the fourth quarter reduction against expectations,
 however, the company has made excellent progress during 2005 and we expect to
 approximate a full-year EBITDA margin of 2 percent," said Jon Chait, chairman
 and chief executive officer of Hudson Highland Group.
     The company will update its 2006 guidance on the year-end earnings call.
     Hudson Highland Group
     Hudson Highland Group is one of the world's leading professional staffing,
 retained executive search and human capital solution providers. We help our
 clients achieve greater organizational performance by attracting, selecting,
 engaging and developing the best and brightest people for their businesses.
 Our approximately 3,800 employees in more than 20 countries are dedicated to
 providing unparalleled service and value to our clients.  More information
 about Hudson Highland Group is available at .
     Safe Harbor Statement
     This press release contains statements that the company believes to be
 "forward-looking statements" within the meaning of the Private Securities
 Litigation Reform Act of 1995. All statements other than statements of
 historical fact included in this press release, including those under the
 caption "Guidance" and other statements regarding the company's future
 financial condition, results of operations, business operations and business
 prospects, are forward-looking statements. Words such as "anticipate,"
 "estimate," "expect," "project," "intend," "plan," "predict," "believe" and
 similar words, expressions and variations of these words and expressions are
 intended to identify forward-looking statements. All forward-looking
 statements are subject to risks and uncertainties that could cause actual
 results to differ materially from those described in the forward-looking
 statements. These factors include, but are not limited to, the impact of
 global economic fluctuations on temporary contracting operations; the cyclical
 nature of the company's executive search and mid-market professional staffing
 businesses; the company's ability to manage its growth and fund working
 capital associated therewith; risks associated with expansion; risks and
 financial impact associated with disposition of non-strategic assets; the
 company's reliance on information systems and technology; competition;
 fluctuations in operating results; risks relating to foreign operations,
 including foreign currency fluctuations; dependence on highly skilled
 professionals and key management personnel; the impact of employees departing
 with existing executive search clients; risks maintaining professional
 reputation and brand name; restrictions imposed by blocking arrangements;
 exposure to employment-related claims, and limits on insurance coverage
 related thereto; government regulations; the company's ability to successfully
 operate as an independent company and the level of costs associated therewith;
 and restrictions on the company's operating flexibility due to the terms of
 its credit facility. Additional information concerning these and other factors
 is contained in the company's filings with the Securities and Exchange
 Commission. These forward-looking statements speak only as of the date of this
 press release. The company assumes no obligation, and expressly disclaims any
 obligation, to review or confirm analysts' expectations or estimates or to
 update any forward-looking statements, whether as a result of new information,
 future events or otherwise.

SOURCE Hudson Highland Group, Inc.