Professional Diversity Network, Inc. (NASDAQ:IPDN), (“IPDN” or the
“Company”), a global developer and operator of online and in-person
networks that provides access to networking, training, educational
and employment opportunities for diverse individuals, today
announced its financial results for the quarter ended March 31,
2022.
“Our PDN Network continues to show growth in its
organic operations despite the challenges in current economic
conditions,” said Adam He, CEO of Professional Diversity Network,
Inc. “Our RemoteMore revenues for the period are consistent with
our expectations, and we believe that the IAW (NAPW) Network is
beginning to stabilize itself as compared to previous years. We are
still focused on capitalizing on growth opportunities, increasing
our return on organic operations, and maximizing shareholder value
throughout 2022.”
First Quarter Financial
Highlights:
- Total consolidated revenues for the three months ended March
31, 2022, increased approximately $0.6 million or 38 percent as
compared to the same period in the prior year. PDN Network segment
revenues increased approximately $0.2 million, or 13 percent
compared to revenues during the same period in the prior year.
Revenues for the three months ended March 31, 2022, from the NAPW
segment decreased less than approximately $0.1 million, or 26
percent as compared to the same period in the prior year. Revenues
for RemoteMore USA during for the three months ended March 31,
2022, were approximately $0.5 million for which there was no
comparable activity in the same period of the prior year.
- Basic and diluted net loss per share remained consistent at
$0.06 during the three months ended March 31, 2022 and March 31,
2021.
- On March 31, 2022, cash balances were approximately $2.9
million as compared to $3.4 million on December 31, 2021. Working
capital surplus from continuing operations on March 31, 2022, was
approximately $0.3 million as compared to $0.4 million on December
31, 2021.
Financial Results for the Three Months
Ended March 31, 2022
Revenues
Total revenues for the three months ended March
31, 2022, increased approximately $569,000, or 38%, to
approximately $2,053,000 from approximately $1,484,000 during the
same period in the prior year. The increase was predominately
attributable to an approximate $477,000 of contracted software
development related to RemoteMore for which there was no comparable
activity in the period of the prior year. Also contributing to the
increase in the period was an increase in recruitment services
revenues from the PDN Network of approximately $158,000, partially
offset by an approximate $68,000 decrease in membership fees and
related services revenues from the NAPW Network, as compared to the
same period in the prior year.
During the three months ended March 31, 2022,
our PDN Network generated approximately $1,380,000 in revenues
compared to approximately $1,220,000 in revenues during the three
months ended March 31, 2021, an increase of approximately $160,000
or 13 percent.
During the three months ended March 31, 2022,
revenues associated with our NAPW network were approximately
$196,000, compared to revenues of approximately $264,000 during the
same period in the prior year, a decrease of approximately $68,000
or 26 percent.
During the three months ended March 31, 2022,
revenues associated with RemoteMore were approximately $477,000 and
there were no revenues in the same period of the prior year.
Costs and Expenses
Cost of revenues during the three months ended
March 31, 2022, was approximately $862,000, an increase of
approximately $601,000, or 230 percent, from approximately $261,000
during the same period of the prior year. The increase was
predominately attributed to approximately $467,000 of contracted
software development costs related to RemoteMore, for which there
was no comparable activity in the same period of the prior year.
Also contributing to the increase was approximately $116,000 of
costs as a direct result of increased revenues.
General and administrative expenses decreased by
approximately $211,000, or 16 percent, to approximately $1,107,000
during the three months ended March 31, 2022, as compared to the
same period in the prior year. The decrease, as compared to the
same period in the prior year, was primarily a result of reductions
of payroll related costs of approximately $219,000, of which
approximately $76,000 related to discretionary incentive payments
made in the prior year for which there were no comparable charges
in the current period. Also contributing to the decrease were
reductions in bad debt charges of approximately $33,000 and other
miscellaneous state taxes of approximately $31,000, partially
offset by expenses related to RemoteMore operations of
approximately $133,000, for which there were no comparable charges
in the same period in the prior year.
Depreciation and amortization expense during the
three months ended March 31, 2022, was approximately $281,000, an
increase of approximately $252,000, compared to approximately
$29,000 during the same period in the prior year. The increase was
primarily attributable to approximately $256,000 of amortization
expense related to RemoteMore’s intangible assets, for which there
were no comparable charges in the same period of the prior year,
partially offset by assets and intangible assets reaching the end
of their useful lives.
Net Loss from Continuing
Operations
As the result of the factors discussed above,
during the three months ended March 31, 2022, we incurred a net
loss of approximately $890,000 from continuing operations, an
increase of approximately $134,000 or 18 percent, compared to a net
loss of approximately $756,000 during the three months ended March
31, 2021.
Summary of the Quarter’s Financial
Information
Amounts in following tables are in thousands
except for per share amounts and outstanding shares.
Summary of Financial Position
|
|
December 31, 2021 |
|
December 31, 2020 |
|
Current Assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
2,974 |
|
$ |
3,403 |
|
Other current assets |
|
|
2,270 |
|
|
2,194 |
|
Total current assets |
|
$ |
5,244 |
|
$ |
5,597 |
|
Long-term assets |
|
|
2,903 |
|
|
3,388 |
|
Total Assets |
|
$ |
8,147 |
|
$ |
8,985 |
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
$ |
4,896 |
|
$ |
5,180 |
|
Total long-term
liabilities |
|
|
665 |
|
|
697 |
|
Total liabilities |
|
$ |
5,561 |
|
$ |
5,877 |
|
|
|
|
|
|
|
|
|
Total Professional Diversity
Network, Inc. stockholders’ equity |
|
|
2,473 |
|
|
2,791 |
|
Total stockholders’ equity –
noncontrolling interests |
|
|
113 |
|
|
317 |
|
Total liabilities and
stockholders’ equity |
|
$ |
8,147 |
|
$ |
8,985 |
|
Summary of Financial Operations
|
|
Three Months EndedMarch 31, |
|
Change |
|
Change |
|
|
|
2022 |
|
2021 |
|
(Dollars) |
|
(Percent) |
|
Revenues: |
|
|
|
|
|
|
|
|
|
Membership fees and related services |
|
$ |
196 |
|
$ |
264 |
|
$ |
(68 |
) |
(25.8 |
)% |
Recruitment services |
|
|
1,333 |
|
|
1,175 |
|
|
158 |
|
13.4 |
% |
Contracted Software Development |
|
|
477 |
|
|
- |
|
|
477 |
|
100.0 |
% |
Consumer advertising and marketing solutions |
|
|
47 |
|
|
45 |
|
|
2 |
|
4.4 |
% |
Total revenues |
|
$ |
2,053 |
|
$ |
1,484 |
|
$ |
569 |
|
38.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
$ |
862 |
|
$ |
261 |
|
$ |
601 |
|
230.3 |
% |
Sales and marketing |
|
|
719 |
|
|
700 |
|
|
19 |
|
2.7 |
% |
General and
administrative |
|
|
1,107 |
|
|
1,318 |
|
|
(211 |
) |
(16.0 |
)% |
Depreciation and
amortization |
|
|
281 |
|
|
29 |
|
|
252 |
|
869.0 |
% |
Total cost and expenses: |
|
$ |
2,969 |
|
$ |
2,308 |
|
$ |
661 |
|
28.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing
operations, net of tax |
|
$ |
(890 |
) |
$ |
(756 |
) |
$ |
(134 |
) |
(17.7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
(0.06 |
) |
$ |
(0.06 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
16,207,113 |
|
|
13,263,402 |
|
|
|
|
|
|
Summary of Cash Flows from Continued Operations
|
|
Three Months Ended March 31, |
|
|
|
2022 |
|
2021 |
|
Cash (used in) provided by
continued operations |
|
|
|
|
|
Operating activities |
|
$ |
(287 |
) |
$ |
(769 |
) |
Investing activities |
|
|
(2 |
) |
|
(6 |
) |
Financing activities |
|
|
(140 |
) |
|
1,000 |
|
Net increase in cash and cash
equivalents from continued operations |
|
$ |
(429 |
) |
$ |
225 |
|
Professional Diversity Network, Inc. and
Subsidiaries
Non-GAAP (Adjusted) Financial
Measures
We believe Adjusted EBITDA provides a meaningful
representation of our operating performance that provides useful
information to investors regarding our financial condition and
results of operations. Adjusted EBITDA is commonly used by
financial analysts and others to measure operating performance.
Furthermore, management believes that this non-GAAP financial
measure may provide investors with additional meaningful
comparisons between current results and results of prior periods as
they are expected to be reflective of our core ongoing business.
However, while we consider Adjusted EBITDA to be an important
measure of operating performance, Adjusted EBITDA and other
non-GAAP financial measures have limitations, and investors should
not consider them in isolation or as a substitute for analysis of
our results as reported under GAAP. Further, Adjusted EBITDA, as we
define it, may not be comparable to EBITDA, or similarly titled
measures, as defined by other companies.
The following table provides a reconciliation of
net loss from continuing operations to Adjusted EBITDA for the
three months ended March 31, 2022, and 2021, the most directly
comparable GAAP measure reported in our consolidated financial
statements:
|
|
Three Months EndedMarch 31, |
|
|
|
2022 |
|
2021 |
|
|
|
(in thousands) |
|
Loss from Continuing Operations |
|
$ |
(890 |
) |
$ |
(756 |
) |
Stock-based compensation |
|
|
124 |
|
|
106 |
|
Litigation settlement reserve |
|
|
17 |
|
|
- |
|
Loss attributable to noncontrolling interest |
|
|
205 |
|
|
- |
|
Depreciation and amortization |
|
|
281 |
|
|
30 |
|
Interest and other income |
|
|
(3 |
) |
|
1 |
|
Income tax expense (benefit) |
|
|
(26 |
) |
|
(67 |
) |
Adjusted
EBITDA |
|
$ |
(292 |
) |
$ |
(686 |
) |
About Professional Diversity
Network
Professional Diversity Network, Inc. (NASDAQ:
IPDN) is a global developer and operator of online and in-person
networks that provides access to networking, training, educational
and employment opportunities for diverse professionals. We operate
subsidiaries in the United States including International
Association of Women (IAW), which is one of the largest, most
recognized networking organizations of professional women in the
country, spanning more than 200 industries and professions. Through
an online platform and our relationship recruitment affinity
groups, we provide our employer clients a means to identify and
acquire diverse talent and assist them with their efforts to comply
with the Equal Employment Opportunity Office of Federal Contract
Compliance Program. Our mission is to utilize the collective
strength of our affiliate companies, members, partners and unique
proprietary platform to be the standard in business diversity
recruiting, networking and professional development for women,
minorities, veterans, LGBTQ+ and disabled persons globally.
In addition, PDN, Inc. owns 45.62% of RemoteMore
USA, an innovative, global entity that provides remote-hiring
marketplace services for developers and companies. Companies are
connected with reliable, cost-efficient, vetted developers, and
empowers every developer to get a meaningful job regardless of
their location.
Forward-Looking Statements
This press release contains certain
forward-looking statements based on our current expectations,
forecasts and assumptions that involve risks and uncertainties.
This release does not constitute an offer to sell or a solicitation
of offers to buy any securities of any entity. Forward-looking
statements in this release are based on information available to us
as of the date hereof. Our actual results may differ materially
from those stated or implied in such forward-looking statements,
due to risks and uncertainties associated with our business, which
include the risk factors disclosed in our most recently filed
Annual Report on Form 10-K and in our subsequent filings with the
Securities and Exchange Commission. Forward-looking statements
include statements regarding our expectations, beliefs, intentions
or strategies regarding the future and can be identified by
forward-looking words such as “anticipate,” “believe,” “could,”
“estimate,” “expect,” “intend,” “may,” “plan,” “should,” and
“would” or similar words. We assume no obligation to update the
information included in this press release, whether as a result of
new information, future events or otherwise. Our most recently
filed Annual Report on Form 10-K, together with this press release
and the financial information contained herein, are available on
our website, www.prodivnet.com. Please click on “Investor
Relations.”
Investor Inquiries:investors@ipdnusa.com+1 (312)
614-0950Source: Professional Diversity Network, Inc.Released May
16, 2022
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