NEW YORK, July 25 /PRNewswire-FirstCall/ -- Hudson Highland Group,
Inc. (NASDAQ:HHGP), one of the world's leading providers of
permanent recruitment, contract professionals and talent management
solutions, today announced financial results for the second quarter
ended June 30, 2007. 2007 Second Quarter Summary -- Revenue of
$348.9 million, a decrease of 0.9 percent from $352.1 million for
the second quarter of 2006 -- Gross margin of $137.6 million, or
39.4 percent of revenue, up 7.0 percent from $128.6 million, or
36.5 percent of revenue, for the same year-ago period -- Adjusted
EBITDA of $13.2 million, or 3.8 percent of revenue, up 42.7 percent
from $9.3 million for the second quarter of 2006 -- EBITDA of $11.7
million, or 3.3 percent of revenue, up 36.9 percent from $8.5
million for the same period last year -- Net income of $3.2
million, or $0.13 per basic and $0.12 per diluted share, compared
with net income of $2.2 million, or $0.09 per basic and diluted
share, for the second quarter of 2006 "During the second quarter,
we delivered strong improvement over the same period last year,
largely driven by our Europe and Asia Pacific operations," said Jon
Chait, Hudson Highland Group chairman and chief executive officer.
"EBITDA increased faster than gross margin as we continue to
benefit from operating leverage." "While last year's particularly
strong third quarter performance will be tough to beat, we remain
squarely focused on driving steady operational and profitability
improvements," said Mary Jane Raymond, executive vice president and
chief financial officer. Guidance The company currently expects
third quarter 2007 revenue of $340 - $355 million at prevailing
exchange rates and adjusted EBITDA of $9 - $12 million. This
compares with revenue of $352.5 million and adjusted EBITDA of
$12.1 million in the third quarter of 2006. 2007 Six-Month Results
For the first six months of 2007, the company reported revenue of
$686.8 million, up 1.1 percent from $679.4 million for the same
six-month period last year. Net income was $3.6 million, or $0.14
per basic and diluted share, compared with a net loss of $5.9
million, or ($0.24) per basic and diluted share, for the same
six-month period last year. Additional Information Please find
additional information about the company's quarterly results in the
shareholder letter in the investor information section of the
company's website at http://www.hhhgroup.com/. Conference
Call/Webcast Hudson Highland Group will conduct a conference call
Thursday, July 26, 2007 at 9:00 AM ET to discuss this announcement.
Investors wishing to participate can join the conference call by
dialing 1-800-374-1532 followed by the participant passcode 7025727
at 8:50 AM ET. For those outside the United States, please call in
on 1-706-634-5594 followed by the participant passcode 7025727.
Hudson Highland Group's quarterly conference call can also be
accessed online through Yahoo! Finance at http://www.yahoo.com/ and
the investor information section of the company's website at
http://www.hhgroup.com/. The archived call will be available for
one week by dialing 1-800-642-1687 followed by the participant
passcode 7025727. For those outside the United States, the call
will be available on 1-706-645-9291 followed by the participant
passcode 7025727. About Hudson Highland Group Hudson Highland
Group, Inc. is a leading provider of permanent recruitment,
contract professionals and talent management services worldwide.
From single placements to total outsourced solutions, Hudson helps
clients achieve greater organizational performance by assessing,
recruiting, developing and engaging the best and brightest people
for their businesses. The company employs more than 3,600
professionals serving clients and candidates in more than 20
countries. More information is available at
http://www.hhgroup.com/. 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 company's history of
negative cash flows and operating losses may continue; the ability
of clients to terminate their relationship with the company at any
time; the impact of global economic fluctuations on temporary
contracting operations; risks and financial impact associated with
acquisitions and dispositions 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; restrictions imposed by blocking arrangements; exposure
to employment-related claims and limits on insurance coverage
related thereto; government regulations; 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. HUDSON HIGHLAND GROUP, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (In thousands,
except share and per share amounts) (unaudited) Three Months Ended
Six Months Ended June 30, June 30, 2007 (1) 2006 (1) 2007 (1) 2006
(1) Revenue $348,861 $352,084 $686,760 $679,368 Direct costs
211,258 223,458 423,277 440,061 Gross margin 137,603 128,626
263,483 239,307 Operating expenses: Selling, general and
administrative 124,399 119,374 243,465 233,670 Depreciation and
amortization 3,952 4,028 7,761 8,213 Business reorganization
expenses 1,578 658 4,694 658 Merger and integration expenses
(recoveries) (42) 72 (42) 72 Total operating expenses 129,887
124,132 255,878 242,613 Operating income (loss) 7,716 4,494 7,605
(3,306) Other income (expense): Interest, net 435 (760) 657 (1,152)
Other, net (21) 128 2,579 1,059 Income (loss) from continuing
operations before income taxes 8,130 3,862 10,841 (3,399) Provision
for income taxes 4,637 2,586 7,014 4,026 Income (loss) from
continuing operations 3,493 1,276 3,827 (7,425) Income (loss) from
discontinued operations, net of income taxes (258) 890 (239) 1,511
Net income (loss) $3,235 $2,166 $3,588 $(5,914) Basic income (loss)
per share: Income (loss) from continuing operations $0.14 $0.05
$0.15 $(0.31) Income (loss) from discontinued operations (0.01)
0.04 (0.01) 0.07 Net income $0.13 $0.09 $0.14 $(0.24) Diluted
income (loss) per share: Income (loss) from continuing operations
$0.13 $0.05 $0.15 $(0.31) Income (loss) from discontinued
operations (0.01) 0.04 (0.01) 0.07 Net income (loss) $0.12 $0.09
$0.14 $(0.24) Weighted average shares outstanding Basic 25,247,000
24,414,000 25,084,000 24,318,000 Diluted 26,164,000 25,172,000
25,907,000 24,318,000 (1) Note - 2007 and 2006 financial statements
have been adjusted to reflect the Highland Partners segment as a
discontinued operation. The sale of Highland Partners was completed
effective on October 1, 2006. HUDSON HIGHLAND GROUP, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (In thousands,
except share and per share amounts) (unaudited) June 30, December
31, 2007 (1) 2006 (1) (unaudited) ASSETS Current assets: Cash and
cash equivalents $56,727 $44,649 Accounts receivable, net 225,593
218,722 Prepaid and other 16,428 16,736 Total current assets
298,748 280,107 Intangibles, net 45,227 37,612 Property and
equipment, net 28,730 28,105 Other assets 5,774 5,045 Total assets
$378,479 $350,869 LIABILITIES AND STOCKHOLDERS' EQUITY Current
liabilities: Accounts payable $31,981 $24,075 Accrued expenses and
other current liabilities 132,589 134,043 Short-term borrowings and
current portion of long-term debt 321 238 Accrued business
reorganization expenses 3,805 5,077 Accrued merger and integration
expenses 384 837 Total current liabilities 169,080 164,270 Other
non-current liabilities 17,643 8,204 Accrued business
reorganization expenses, non-current 4,305 3,409 Accrued merger and
integration expenses, non-current 1,380 1,721 Long-term debt, less
current portion 100 235 Total liabilities 192,508 177,839
Commitments and contingencies Stockholders' equity: Preferred
stock, $0.001 par value, 10,000,000 shares authorized; none issued
or outstanding - - Common stock, $0.001 par value, 100,000,000
shares authorized; issued: 25,540,213 and 24,957,732 shares,
respectively 26 25 Additional paid-in capital 436,835 427,645
Accumulated deficit (298,290) (298,344) Accumulated other
comprehensive income-translation adjustments 47,681 43,934 Treasury
stock, 18,431 and 15,798 shares, respectively (281) (230) Total
stockholders' equity 185,971 173,030 $378,479 $350,869 (1) Note -
2007 and 2006 financial statements have been adjusted to reflect
the Highland Partners segment as a discontinued operation. The sale
of Highland Partners was completed effective on October 1, 2006.
HUDSON HIGHLAND GROUP, INC. SEGMENT ANALYSIS (In thousands)
(unaudited) For the Three Months Ended June 30, Hudson Hudson
Hudson 2007 (1) Americas Europe Asia Pacific Corporate Total
Revenue $106,615 $125,745 $116,501 $- $348,861 Gross margin $25,962
$64,488 $47,153 $- $137,603 Adjusted EBITDA (2) $(751) $10,886
$9,617 $(6,548) $13,204 Business reorganization expenses (7) (7) 17
1,575 1,578 Merger and integration recoveries (42) - - - (42)
EBITDA (2) (702) 10,893 9,600 (8,123) 11,668 Depreciation and
amortization 1,180 1,714 992 66 3,952 Operating income (loss)
$(1,882) $9,179 $8,608 $(8,189) $7,716 For the Three Months Ended
June 30, Hudson Hudson Hudson 2006 (1) Americas Europe Asia Pacific
Corporate Total Revenue $119,145 $122,062 $110,877 $- $352,084
Gross margin $28,971 $56,225 $43,430 $- $128,626 Adjusted EBITDA
(2) $(1,416) $7,972 $9,541 $(6,845) $9,252 Business reorganization
expenses (recoveries) 250 (57) 152 313 658 Merger and integration
expense 72 - - - 72 EBITDA (2) (1,738) $8,029 9,389 (7,158) 8,522
Depreciation and amortization 1,313 1,776 771 168 4,028 Operating
income (loss) $(3,051) $6,253 $8,618 $(7,326) $4,494 (1) Note -
2007 and 2006 financial statements have been adjusted to reflect
the Highland Partners segment as a discontinued operation. The sale
of Highland Partners was completed effective on October 1, 2006.
(2) Non-GAAP earnings before interest, income taxes, special
charges, other non-operating expense, and depreciation and
amortization ("Adjusted EBITDA") and non-GAAP earnings before
interest, income taxes, other non- operating expense, and
depreciation and amortization ("EBITDA") are presented to provide
additional information about the company's operations on a basis
consistent with the measures which the company uses to manage its
operations and evaluate its performance. Management also uses these
measurements to evaluate capital needs and working capital
requirements. Adjusted EBITDA and EBITDA should not be considered
in isolation or as a substitute for operating income, cash flows
from operating activities, and other income or cash flow statement
data prepared in accordance with generally accepted accounting
principles or as a measure of the company's profitability or
liquidity. Furthermore, adjusted EBITDA and EBITDA as presented
above may not be comparable with similarly titled measures reported
by other companies. Amortization for 2006 includes accelerated
amortization expense related to changes in estimates and
valuations. HUDSON HIGHLAND, INC. SEGMENT ANALYSIS (in thousands)
(unaudited) For the Six Months Ended June 30, Hudson Hudson Hudson
2007 (1) Americas Europe Asia Pacific Corporate Total Revenue
$219,419 $247,753 $219,588 $- $686,760 Gross margin $53,032
$123,511 $86,940 $- $263,483 Adjusted EBITDA (2) $(882) $18,133
$15,565 $(12,798) $20,018 Business reorganization expenses 722
2,440 31 1,501 4,694 Merger and integration recoveries (42) - - -
(42) EBITDA (2) (1,562) 15,693 15,534 (14,299) 15,366 Depreciation
and amortization 2,329 3,367 1,884 181 7,761 Operating income
(loss) $(3,891) $12,326 $13,650 $(14,480) $7,605 For the Six Months
Ended June 30, Hudson Hudson Hudson 2006 (1) Americas Europe Asia
Pacific Corporate Total Revenue $229,750 $238,203 $211,415 $-
$679,368 Gross margin $51,826 $107,190 $80,291 $- $239,307 Adjusted
EBITDA (2) $(7,391) $13,522 $14,273 $(14,767) $5,637 Business
reorganization expenses (recoveries) 250 (57) 152 313 658 Merger
and integration expense 72 - - - 72 EBITDA (2) (7,713) 13,579
14,121 (15,080) 4,907 Depreciation and amortization 2,819 3,515
1,546 333 8,213 Operating income (loss) $(10,532) $10,064 $12,575
$(15,413) $(3,306) (1) Note - 2007 and 2006 financial statements
have been adjusted to reflect the Highland Partners segment as a
discontinued operation. The sale of Highland Partners was completed
effective on October 1, 2006. (2) Non-GAAP earnings before
interest, income taxes, special charges, other non-operating
expense, and depreciation and amortization ("Adjusted EBITDA") and
non-GAAP earnings before interest, income taxes, other non-
operating expense, and depreciation and amortization ("EBITDA") are
presented to provide additional information about the company's
operations on a basis consistent with the measures which the
company uses to manage its operations and evaluate its performance.
Management also uses these measurements to evaluate capital needs
and working capital requirements. Adjusted EBITDA and EBITDA should
not be considered in isolation or as a substitute for operating
income, cash flows from operating activities, and other income or
cash flow statement data prepared in accordance with generally
accepted accounting principles or as a measure of the company's
profitability or liquidity. Furthermore, adjusted EBITDA and EBITDA
as presented above may not be comparable with similarly titled
measures reported by other companies. Amortization for 2006
includes accelerated amortization expense related to changes in
estimates and valuations. HUDSON HIGHLAND, INC. (in thousands) For
the Three Months Ended Total September 30, 2006 (1) Adjusted EBITDA
(2) $12,122 Business reorganization expenses 2,090 Merger and
integration (recoveries) 14 EBITDA (2) 10,018 Depreciation and
amortization 3,868 Operating income $6,150 (1) Note - 2007 and 2006
financial statements have been adjusted to reflect the Highland
Partners segment as a discontinued operation. The sale of Highland
Partners was completed effective on October 1, 2006. (2) Non-GAAP
earnings before interest, income taxes, special charges, other
non-operating expense, and depreciation and amortization ("Adjusted
EBITDA") and non-GAAP earnings before interest, income taxes, other
non- operating expense, and depreciation and amortization
("EBITDA") are presented to provide additional information about
the company's operations on a basis consistent with the measures
which the company uses to manage its operations and evaluate its
performance. Management also uses these measurements to evaluate
capital needs and working capital requirements. Adjusted EBITDA and
EBITDA should not be considered in isolation or as a substitute for
operating income, cash flows from operating activities, and other
income or cash flow statement data prepared in accordance with
generally accepted accounting principles or as a measure of the
company's profitability or liquidity. Furthermore, adjusted EBITDA
and EBITDA as presented above may not be comparable with similarly
titled measures reported by other companies. Amortization for 2006
includes accelerated amortization expense related to changes in
estimates and valuations. DATASOURCE: Hudson Highland Group, Inc.
CONTACT: David F. Kirby of Hudson Highland Group, +1-212-351-7216,
or Web site: http://www.hhgroup.com/
Copyright
Hudson Highland (NASDAQ:HHGP)
Historical Stock Chart
From Aug 2024 to Sep 2024
Hudson Highland (NASDAQ:HHGP)
Historical Stock Chart
From Sep 2023 to Sep 2024