Staffing 360 Solutions Reports First Quarter 2019 Results
April 30 2019 - 4:15PM
Reports First Ever Net Income
Positive4.9% Organic Growth
Staffing 360 Solutions, Inc. (NASDAQ: STAF), a company executing an
international buy-integrate-build strategy through the acquisition
of staffing organizations in the United States and the United
Kingdom, today announced its Fiscal 2019 first quarter results.
Q1 2019 Highlights
- Revenue grew by 32.3% to $73.8 million, from $55.8 million in
Q1 ’18, including organic growth of 4.9%
- Gross profit grew by 4.6% to $12.1 million, from $11.6 million
in Q1 ’18
- Gross margin was 16.4% compared with 20.8% in Q1 ’18
- Income from operations of $0.7 million compared with a loss
from operations of $0.4 million in Q1 ’18
- Net income of $0.2 million compared with net loss of $1.3
million in Q1 ’18
- EBITDA grew 77.2% to $3.1 million, from $1.8 million in Q1
’18
- Adjusted EBITDA grew 26.2% to $2.0 million, from $1.6 million
in Q1 ’18
Brendan Flood, Chairman and Chief Executive
Officer said, “The Company’s first ever report of positive net
income is a tremendous milestone for us. It’s a reflection of a
major success point on the long road we’ve been on and heralds the
beginning of a new chapter for Staffing 360 Solutions.”
Use of Non-GAAP Financial
Measures EBITDA and Adjusted EBITDA are non-GAAP financial
measures. Other companies may have different definitions of
these non-GAAP financial measures, and as a result they may not be
comparable with non-GAAP financial measures provided by other
companies. EBITDA and Adjusted EBITDA are calculated in a manner
consistent with that shown in the table at the end of this press
release and should not be considered alternatives to measurements
required by U.S. GAAP, such as net revenue, operating profit or net
income, and should not be considered a measure of the Company’s
liquidity.
The Company uses these non-GAAP financial
measures, among several other metrics, to assess and analyze its
operational results and trends. The Company also believes these
measures are useful to investors because they are common operating
performance metrics as well as metrics routinely used to assess
potential enterprise value.
Conference CallThe Participant
Dial-In Number for the conference call is 323-701-0225.
Participants should dial in to the call at least five minutes
before 9:00am ET May 1, 2019. The call can also be accessed "live"
online at http://public.viavid.com/index.php?id=134281. A replay of
the recorded call will be available for 90 days on the Company's
website (http://www.staffing360solutions.com/res.html). You can
also listen to a replay of the call by dialing 1-844-512-2921
(international participants dial 1-412-317-6671) starting May 1,
2019, at 7:30pm ET through May 8, 2019 at 11:59 pm ET. Please use
PIN Number 2251753.
About Staffing 360 Solutions,
Inc.Staffing 360 Solutions, Inc. is engaged in the
execution of an international buy-integrate-build strategy through
the acquisition of domestic and international staffing
organizations in the United States and United Kingdom. The
Company believes that the staffing industry offers opportunities
for accretive acquisitions that will drive its annual revenues to
$500 million. As part of its targeted consolidation model, the
Company is pursuing acquisition targets in the finance and
accounting, administrative, engineering, IT, and Light Industrial
staffing space. For more information, please
visit: www.staffing360solutions.com. Follow Staffing 360
Solutions
on Facebook, LinkedIn and Twitter.
Forward-Looking StatementsThis
press release contains forward-looking statements, which may be
identified by words such as "expect," "look forward to,"
"anticipate" "intend," "plan," "believe," "seek," "estimate,"
"will," "project" or words of similar meaning. Although
Staffing 360 Solutions, Inc. believes such forward-looking
statements are based on reasonable assumptions, it can give no
assurance that its expectations will be attained. Actual
results may vary materially from those expressed or implied by the
statements herein, including the goal of achieving annualized
revenues of $500 million, due to the Company’s ability to
successfully raise sufficient capital on reasonable terms or at
all, to consummate additional acquisitions, to successfully
integrate newly acquired companies, to organically grow its
business, to successfully defend potential future litigation,
changes in local or national economic conditions, the ability to
comply with contractual covenants, including in respect of its
debt, as well as various additional risks, many of which are now
unknown and generally out of the Company’s control, and which are
detailed from time to time in reports filed by the Company with the
SEC, including quarterly reports on Form 10-Q, reports on Form 8-K
and annual reports on Form 10-K. Staffing 360 Solutions does
not undertake any duty to update any statements contained herein
(including any forward-looking statements), except as required by
law.
Investor Relations Contact: Harvey Bibicoff,
CEO Bibicoff + MacInnis, Inc. 818.379.8500
harvey@bibimac.com
|
Staffing 360 Solutions, Inc. and
Subsidiaries |
Reconciliation of Net Income (Loss) to
Adjusted EBITDA |
(All Amounts in Thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2019 |
|
Q1 2018 |
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
73,829 |
|
|
$ |
55,791 |
|
|
|
|
|
|
|
|
|
|
Gross
Profit |
|
$ |
12,118 |
|
|
$ |
11,581 |
|
|
|
Gross
Margin |
|
|
16.4 |
% |
|
|
20.8 |
% |
|
|
|
|
|
|
|
|
|
Net Income
(Loss) |
|
$ |
229 |
|
|
$ |
(1,271 |
) |
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
Interest
expense and amortization of debt discount and deferred financing
costs |
|
$ |
2,007 |
|
|
$ |
2,077 |
|
|
|
(Benefit
from) Provision for income taxes |
|
|
(2 |
) |
|
|
152 |
|
|
|
Depreciation and Amortization |
|
|
877 |
|
|
|
798 |
|
|
|
EBITDA |
|
|
3,111 |
|
|
|
1,756 |
|
|
|
|
|
|
|
|
|
|
Acquisition, capital raising and other non-recurring expenses
(1) |
|
|
211 |
|
|
|
847 |
|
|
|
Other
non-cash charges (2) |
|
|
197 |
|
|
|
373 |
|
|
|
Change in
fair value of warrant liability |
|
|
- |
|
|
|
(538 |
) |
|
|
Gain on
settlement of deferred consideration |
|
|
(847 |
) |
|
|
- |
|
|
|
Re-measurement gain on intercompany note |
|
|
(351 |
) |
|
|
(575 |
) |
|
|
Other
income |
|
|
(286 |
) |
|
|
(250 |
) |
|
|
Adjusted
EBITDA |
|
$ |
2,035 |
|
|
$ |
1,613 |
|
|
|
Adjusted
EBITDA Margin |
|
|
2.8 |
% |
|
|
2.9 |
% |
|
|
|
|
|
|
|
|
|
TTM Adjusted
EBITDA |
|
$ |
9,429 |
|
|
$ |
7,976 |
|
|
|
|
|
|
|
|
|
|
Gross Profit TTM |
|
$ |
48,841 |
|
|
$ |
40,996 |
|
|
|
|
|
|
|
|
|
|
TTM Adjusted EBITDA as
percentage of gross profit TTM |
|
|
19.3 |
% |
|
|
19.5 |
% |
|
|
|
|
|
|
|
|
|
Pro Forma TTM Adjusted EBITDA (3) |
|
$ |
10,818 |
|
|
$ |
10,340 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Acquisition, capital raising and other non-recurring
expenses primarily relate to capital raising expenses,
acquisition and integration expenses and legal expenses incurred in
relation to matters outside the ordinary course of business. |
|
(2) Other non-cash charges primarily relate to staff
option and share compensation expense, expense for shares issued to
directors for board services, and consideration paid for consulting
services. |
|
(3) Pro Forma TTM Adjusted EBITDA includes the Adjusted EBITDA
of acquisitions for the period prior to the acquisition
date. |
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