Event Brief of Q1 2004 Resources Connection Earnings Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

CORPORATE PARTICIPANTS

. Kate Duchene, Resources Connection, Chief Legal Officer . Don Murray, Resources Connection, Chairman, CEO & President . Steve Giusto, Resources Connection, CFO, EVP of Corporate Development

OVERVIEW

RECN's 1Q04 revenues totaled $59.5m vs. $43.5m in 1Q03, which represents YoverY growth of 37% and a small sequential improvement. Avg. weekly revenue in 1Q04 was $4.2m per week. Domestic GM was on RECN's 40% target. Q&A Focus:ETM, RCG, RAS, M&A Activity, and Guidance.

FINANCIAL DATA

A. Key Data From Call 1. 1Q04 Earnings = $3.4m. 2. 1Q04 SG&A = $17.2m. 3. 1Q04 D&A = $693,000. 4. 1Q04 Interest income = $172,000.

PRESENTATION SUMMARY

S1. 1Q04 Overview (D.M.) 1. 1Q04 Highlights: 1. RECN acquired two international businesses from the Big 4 during 1Q04.

1. 1Q04 will be the first quarter that includes some results from the Dutch and Australian practices. 2. 1Q04 includes the partial impact from the acquisition of co.'s internal audit software PolicyIQ. 3. Australian results are included for the entire quarter, the Dutch results are included only for seven weeks, and the

PolicyIQ results for only the final four weeks of the quarter.

2. 1Q04 Operating Results: 1. 1Q04 total revenues were $59.5m.

1. The revenues were higher than 1Q03 by 37% and are better sequentially. 2. Excluding revenues from the sources acquired during the last 12 months, revenue was higher by 17% than the year-ago period. 3. Experienced a softening in the summer months, particularly in the international locations. 1. It won't be until later in the year RECN's revenue will be impacted by a full quarter from all of the acquisitions in periods that are stronger for them.

2. The combination of July 4 holiday and effects of the East Coast blackout shortened billing days by about 1.5 days. 4. From a strategic standpoint, co.'s domestic business is growing nicely.

5. Some of RECN's clients in US have used its services in the

Netherlands and Australia. 6. Co. expects there is some transition time necessary for its European practice to adjust to the RECN model in a recessionary climate. 1. Now that they are out of the Big 4 umbrella, they can focus on some of the same initiatives that RECN did in US to help co. cope with the recession. 7. GM was at 40% target domestically, and about 35% internationally.

8. Overall GM was 39.4%. 3. Resources Audit Solutions Practice:

1. Continues to grow. 2. RECN has built this practice organically and the revenue run rate from this business continues to grow.

1. As of last week, the annualized run rate for RAS was over

$30m. 3. The majority of co.'s biggest engagements continue to be the result of changes like bankruptcy, Sarbanes, corporate

governance changes. 4. Companies are now dealing with issues that they had postponed, rather than a pickup from the economy.

4. Client Statistics: 1. Revenue from co.'s 50 largest clients represented 46% of total revenues during 1Q04. 1. Largest client was about 7% of revenue. 2. Of co.'s top-50 clients from the previous FY, all were still clients during 1Q04. 1. 45 of this 50 have already spent at least $100,000 with RECN this year. 3. RECN believes that as companies begin to feel more comfortable

about their own businesses, this type of demand will continue.

4. Eight of co.'s ten largest clients have been clients for over

three years. 5. Resources Consulting Group: 1. Eight of the salaried consultants will be leaving the business within the next two weeks. 2. Revenues and operating earnings from this group have not been material to RECN's consolidated results.

3. Many of the types of services provided by this group can be

provided by RECN's core Human Capital …