Event Brief of Q2 2005 Resources Connection Earnings Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

CORPORATE PARTICIPANTS

. Kate Duchene, Resources Connection, Inc., Chief Legal Officer,

EVP, Human Relations . Don Murray, Resources Connection, Inc., Chairman, President & CEO . Steve Giusto, Resources Connection, Inc., CFO

OVERVIEW

RECN reported 2Q05 revenues of $137m. 2Q05 earnings were $15.6m or $0.62 per share. In 2Q05 domestic GM was about 40% and about 35% internationally. Overall GM was over 40%. The Co. has a long-term operating margin target of 15%, while continuing to invest for future growth. Q&A Focus: New projects, GM, SG&A, Sarbanes, RAS, and Big Four.

FINANCIAL DATA

A. Key Data From Call 1. 2Q05 revenues = $137m. 2. 2Q05 domestic GM = 40%. 3. 2Q05 international GM = 35%. 4. 2Q05 SG&A expenses = $28.2m. 5. 2Q05 cash and investments = $98m. 6. 2Q05 DSOs = 47 days.

PRESENTATION SUMMARY

S1. Company Overview (D.M.) 1. Company Background: 1. Professional services firm originally founded within the Big Five accounting industry; now the Big Four. 2. RECN's strategy since it started has been to expand the Co.'s service lines in geographic locations to serve its client base of professional services, where clients need internal help to fix problems and complete internal projects.

3. RECN provides a professional alternative to traditional

consulting firms in the Big Four for internal consulting and

projects. 4. The Co. has expanded its service lines to include accounting and finance, information management, human capital, supply chain management, Resources Audit Solutions, and the Co. has recently launched legal services. 5. RECN sells corporate governance and policy documentation software under the trade name PolicyIQ. 2. Geographical Expansion: 1. The Co. has expanded geographically to 63 locations, offices worldwide, including: 1. 49 in the US. 2. Nine in Europe, including a new startup in Paris. 3. Five in the Netherlands after RECN consolidated two of the Dutch offices. 4. Five in Asia-Pacific, and have recently entered a joint venture relationship with a Chinese accounting firm in Mainland China to better serve clients with needs in China. 2. The Co. expects to continue expansion, focusing on introducing some of its newer service lines to establish offices, as well as opportunistic expansion geographically. 3. While 2Q05 was the seventh qtr. in a row with sequential revenue growth, the economic and regulatory trends that began in the middle of FY04 have continued into the middle of FY05. 3. 2Q05 Operating Results: 1. Revenues for 2Q05 were $137m. 1. This revenue is higher than 1Q04 by 85%, and is sequentially higher by 19%.

2. These revenue results reflect the continued strong demand the Co. has been experiencing. 2. The Co.'s domestic practices continued to grow through the qtr. 1. RECN has not seen any significant change since qtr.-end. 2. There has been some improvement internationally as well. 3. In dollar terms, UK practice revenues were 275% greater than the prior year's comparable qtr. and higher sequentially by 32%. 4. RECN's Dutch practice revenue was better than during the summer months and it was up sequentially by 22% in dollars. 5. Revenue from the Co.'s Asia-Pacific region was up a little sequentially and over 160% YoverY.

6. These regions were also up when measured in local currencies,

but favorable exchange rates created a greater increase when

measured in dollars. 4. Four Key Components of Growth Strategy:

1. Against RECN's client penetration goal, the Co. has created

enhanced visibility of its services to several large clients.

1. The Co. believes it is now building new relationships in new

areas within its existing expanded client base. 2. Revenues from the Co.'s 50 largest clients represented 40% of total revenues during the qtr. with its largest client in the qtr. at about 2% of revenue. 3. As of the end of 2Q05, the Co.'s 50 largest clients in FY04 are still clients this year. 1. Of the 50 largest clients so far this year, 31 were in last year's top 50, and the Co. has added 19 newer clients to the top 50. 2. 50% of RECN's revenue YTD came from 77 clients. 2. Against RECN's goal of adding significant new clients, during this year, the Co. did add new clients, including a number of Fortune 500 companies. 1. At this time a year ago, the Co. had served over 1,000 clients YTD and this year, RECN has served over 1,300. 2. Some of the Co.'s new clients have been referred by their current audit firm or by existing clients primarily to assist these companies internally with their risk management. 3. RECN continued its geographic expansion that enables the Co. to become more relevant and useful to major multinational

companies. 1. After the end of 2Q05, RECN opened a practice in Paris, France. 2. Under the leadership of two ex-Big Four consulting partners, the Co. now is establishing new capabilities in one of Europe's largest economies. 3. In Asia, the Co. has established affiliate relationships that allows it to serve India and Mainland China. 4. While neither of these developments will impact the Co.'s operations significantly in the short-term, they do aid the groundwork for further international progress in the years

to come. 4. The Co.'s services strategy is developing well.

1. The percentage of RECN's total revenues derived from accounting and finance is decreasing, as the Co. diversifies its revenues based across its six services and expand its services to clients in a variety of professional areas. 2. Accounting and finance is still the Co.'s largest service line and it continues to grow. 5. Strategy Summary: 1. The Co. continues to look for ways to improve its client

service and become more useful to clients. 6. Gross Margin:

1. GM for 2Q05 was about 40% domestically and about 35% internationally. 2. Overall GM for the qtr. was over 40%, a full point higher than the Co.'s stated target of 39%. 3. GM continues to be reduced by low conversion fees vs. pre-recession levels, less than 1% of revenues and high reimbursable costs.

1. Neither of these factors affect the Co.'s pricing and overall pricing remains fine. 7. Service Lines: 1. All service lines continue to grow. 2. Accounting and finance services continued as the Co.'s largest revenue service line. 3. Resources Audit Solutions (RAS) continued its rapid growth. 1. It represents approx. 38% of revenues YTD; not all this revenue is related to Sarbanes.

8. Sarbanes-Oxley Compliance: 1. RECN continues to experience strong demand from engagements dealing with Sarbanes-Oxley compliance.

2. Many of RECN's clients are discovering that the time and

effort required to comply initially and then ongoing with

Section-404 is substantially more then they expected. 3. RECN has only limited experience with its clients demands after initial Sarbanes compliance, but do have some positive examples that are encouraging. 4. Substantial improvement and demand for services occurred in early Jan. of this year and as the Co. approach Jan. 2005, RECN has not seen any significant slackening of demand.

5. There are numerous potential demand drivers that can help RECN

maintain reasonable growth, but the possibility exists that

some work related to SOX will end faster than it can replace

it with new projects. 6. Other regulatory changes may also increase demand, such as the New York Stock Exchange mandate requiring internal audit department.

S2. Financial Review (S.G.) 1. Revenues: 1. Revenues totaled $137.0m for 2Q05 vs. $74.0m in 2Q04, and $115.4m in 1Q05.

1. These results represent YoverY growth of over 80% and a sequential improvement of 19%. 2. Revenue trends on a consolidated basis …