Record Revenues, Gross Profit and Gross
Profit Percentage
BG Staffing, Inc. (NYSE American:
BGSF), a growing national provider of professional temporary
staffing services, today reported record financial results for its
third quarter and nine months ended September 29, 2019.
Quarter Three 2019 Results
2019
2018
Change
% Change
(amounts in thousands, except
per-share amounts)
Revenues
$
79,364
$
77,062
$
2,302
3.0
%
Gross profit
$
22,176
$
21,373
$
803
3.8
%
Gross profit percentage
27.9
%
27.7
%
0.2
%
0.7
%
Net income
$
4,207
$
5,061
$
(854
)
(16.9
)%
Net income per diluted share
$
0.41
$
0.49
$
(0.08
)
(16.3
)%
Weighted average diluted shares
10,344
10,343
1
0.0
%
Adjusted EPS (1)
$
0.52
$
0.43
$
0.09
20.9
%
Adjusted EBITDA (1)
$
8,296
$
8,244
$
52
0.6
%
Adjusted EBITDA percentage (2)
10.5
%
10.7
%
(0.2
)%
(1.9
)%
Nine-Months Ended 2019 Results
2019
2018
Change
% Change
(amounts in thousands, except
per-share amounts)
Revenues
$
221,998
$
214,863
$
7,135
3.3
%
Gross profit
$
61,478
$
57,875
$
3,603
6.2
%
Gross profit percentage
27.7
%
26.9
%
0.8
%
3.0
%
Net income
$
10,505
$
12,697
$
(2,192
)
(17.3
)%
Net income per diluted share
$
1.01
$
1.32
$
(0.31
)
(23.5
)%
Weighted average diluted shares
10,366
9,639
727
7.5
%
Adjusted EPS (1)
$
1.26
$
1.33
$
(0.07
)
(5.3
)%
Adjusted EBITDA (1)
$
20,332
$
20,690
$
(358
)
(1.7
)%
Adjusted EBITDA percentage (2)
9.2
%
9.6
%
(0.4
)%
(4.2
)%
(1) Non-GAAP financial measure. See
reconciliation at end for details. (2) Adjusted EBITDA as a
percentage of revenue.
Beth A. Garvey, President and CEO, stated, "We are pleased with
our solid operating performance during the third quarter and nine
months just ended. We continue to see a tight labor market
resulting in heightened demand for our professional staffing
services. Our technology investment in every stage of our delivery
model is progressing, as this remains core to providing outstanding
service to our client partners and field talent today and in the
future."
Garvey added, “Comparative net income and earnings per share
were impacted due to the Q2 2018 recognition of a contingent
consideration gain and the positive tax impact of the option
cancellation agreement, compounded by the Q3 2019 loss on
extinguishment of debt.”
Conference Call
The Participant Dial-In Number for the conference call is
1-631-891-4304. Participants should dial in to the call at least
five minutes before 1:30pm PT (4:30pm ET) on November 5, 2019. The
call can also be accessed "live" online at http://public.viavid.com/index.php?id=136118. A
replay of the recorded call will be available for 90 days on the
Company's website (http://bgstaffing.investorroom.com/). You can also
listen to a replay of the call by dialing 1-844-512-2921
(international participants dial 1-412-317-6671) starting November
5, 2019, at 7:30pm ET through November 12, 2019 at 11:59 pm ET.
Please use PIN Number 10007620.
About BG Staffing, Inc.
Headquartered in Plano, Texas, BG Staffing provides staffing
services to a variety of industries through its various divisions.
BG Staffing is primarily a professional temporary staffing platform
that has integrated several regional and national brands achieving
scalable growth. The Company was ranked by Staffing Industry
Analysts as the 64th largest U.S. staffing company in the 2019
update and the 45th largest IT staffing firm in 2018. The Company’s
disciplined acquisition philosophy, which builds value through both
financial growth and the retention of unique and dedicated talent
within BG Staffing’s portfolio of companies, has resulted in a
seasoned management team with strong tenure and the ability to
offer exceptional service to our field talent and client partners
while building value for investors. For more information on the
Company and its services, please visit its website at www.bgstaffing.com.
Forward-Looking Statements
The forward-looking statements in this press release are made
under the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995. The Company’s actual results could
differ materially from those indicated by the forward-looking
statements because of various risks and uncertainties including
those listed in Item 1A of the Company’s Annual Report on Form 10-K
and in the Company’s other filings and reports with the Securities
and Exchange Commission. All of the risks and uncertainties are
beyond the ability of the Company to control, and in many cases,
the Company cannot predict the risks and uncertainties that could
cause its actual results to differ materially from those indicated
by the forward-looking statements. When used in this press release,
the words “believes,” “plans,” “expects,” “will,” “intends,”
“continue,” “outlook,” “progressing,” and “anticipates” and similar
expressions as they relate to the Company or its management are
intended to identify forward-looking statements. Except as required
by law, the Company is not obligated to publicly release any
revisions to these forward-looking statements to reflect the events
or circumstances after the date of this press release or to reflect
the occurrence of unanticipated events.
BG Staffing, Inc.
Non-GAAP Financial Measures
The financial results of BG Staffing, Inc. are prepared in
conformity with accounting principles generally accepted in the
United States of America ("GAAP") and the rules of the U.S.
Securities and Exchange Commission. To help the readers understand
the Company's financial performance, the Company supplements its
GAAP financial results with Adjusted EBITDA and Adjusted EPS.
A non-GAAP financial measure is a numerical measure of a
company's financial performance that excludes or includes amounts
so as to be different than the most directly comparable measure
calculated and presented in accordance with GAAP in the statement
of income, balance sheet or statement of cash flows of a company.
Adjusted EBITDA and Adjusted EPS are not a measurement of financial
performance under GAAP and should not be considered as an
alternative to net income, net income per diluted share, operating
income, or any other performance measure derived in accordance with
GAAP, or as an alternative to cash flow from operating activities
or measure of our liquidity. We believe that Adjusted EBITDA and
Adjusted EPS are useful performance measures and are used by us to
facilitate a comparison of our operating performance on a
consistent basis from period-to-period and to provide for a more
complete understanding of factors and trends affecting our business
than measures under GAAP can provide alone. In addition, the
financial covenants in our credit agreement are based on adjusted
EBITDA as defined in the credit agreement.
We define “Adjusted EBITDA” as earnings before interest expense,
income taxes, depreciation and amortization expense, non-cash
items, and certain items that management does not consider in
assessing our on-going operating performance.
Reconciliation of Net Income
to Adjusted EBITDA
Thirteen Weeks Ended
Thirty-nine Weeks Ended
September 29, 2019
September 30, 2018
September 29, 2019
September 30, 2018
(dollars in thousands)
Net income
$
4,207
$
5,061
$
10,505
$
12,697
Interest expense, net
395
662
1,245
2,275
Income tax expense
1,334
1,368
3,194
2,732
Depreciation and amortization
1,197
1,248
3,633
3,801
Loss on extinguishment of debt
541
—
541
—
Contingent consideration
—
(988
)
—
(2,160
)
Share-based compensation
244
758
751
873
Transaction fees
37
135
94
472
IT roadmap
341
—
369
—
Adjusted EBITDA
$
8,296
$
8,244
$
20,332
$
20,690
We define “Adjusted EPS” as diluted earnings per share
eliminating amortization expense of intangible assets from
acquisitions, contingent consideration gains or losses, and certain
non-recurring events, net of the respective income tax effect.
Reconciliation of Adjusted
EPS
Thirteen Weeks Ended
Thirty-nine Weeks Ended
September 29, 2019
September 30, 2018
September 29, 2019
September 30, 2018
Net income per diluted share
$
0.41
$
0.49
$
1.01
$
1.32
Acquisition amortization
0.09
0.10
0.27
0.32
Loss on extinguishment of debt
0.05
—
0.05
—
Contingent consideration
—
(0.10
)
—
(0.22
)
Option cancellation agreement, tax
effect
—
(0.06
)
—
(0.07
)
Income tax expense adjustment
(0.03
)
—
(0.07
)
(0.02
)
Adjusted EPS
$
0.52
$
0.43
$
1.26
$
1.33
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191105005259/en/
Terri MacInnis, VP of Investor Relations Bibicoff + MacInnis,
Inc. 818.379.8500 terri@bibimac.com
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