Star Equity Holdings, Inc. (Nasdaq: STRR; STRRP) (“Star Equity” or
the “Company”), a diversified holding company, reported today its
financial results for the first quarter (Q1) ended March 31,
2023. All 2023 and 2022 amounts in this release are unaudited.
Q1 Quarter 2023 Financial Highlights vs.
Q1 Quarter 2022 (unaudited)
- Revenues increased by 2.6% to
$25.7 million from $25.0 million.
- Gross profit increased by 62.8% to
$7.6 million from $4.7 million.
- Net income was $0.4 million
(or $0.03 per basic and diluted share) compared to a net loss of
$3.7 million (or $0.29 per basic and diluted share).
- Non-GAAP adjusted net income was
$0.9 million (or $0.06 per diluted share) compared to a loss of
$0.7 million (or $0.05 per diluted share).
- Non-GAAP adjusted EBITDA was
$1.7 million versus $0.1 million.
- As of March 31, 2023, cash and
cash equivalents of $5.7 million decreased compared to cash and
cash equivalents of $15.0 million at March 31, 2022; net
debt, defined as total debt less total cash and cash equivalents,
increased to net debt of $2.7 million from net cash of $1.7
million.
Rick Coleman, Chief Executive Officer, noted,
“Star Equity’s strong start to 2023 reflects the team’s continued
execution on our operating plan. We achieved first quarter adjusted
EBITDA of $1.7 million, versus $0.1 million in the first
quarter of last year, primarily due to continued strong top and
bottom-line growth at our Construction division. Better operational
efficiency, pricing, and cost discipline drove the Construction
division’s improved results. Although Healthcare division revenue
was roughly flat versus the prior year quarter, gross margin
improved by 1.2 percentage points to 24.9% due to our realigned
focus on higher-margin products and services stemming from our May
2022 reorganization.”
Mr. Coleman continued, “With the sale of Digirad
Health on May 4, we have significantly strengthened our balance
sheet and are well positioned to execute on our growth strategy of
generating organic growth at our Construction division, and
completing acquisitions — which could either be Construction
bolt-ons or entries into new business sectors — and thoughtfully
expanding activity at our Investments division. We plan to provide
shareholders updates on these and other initiatives over time.”
Revenues
The Company’s Q1 2023 revenues increased 2.6% to
$25.7 million from $25.0 million in the first quarter of 2022.
Revenues in $ thousands |
|
Q1 2023 |
|
Q1 2022 |
|
% change |
Healthcare |
|
$ |
13,359 |
|
|
$ |
13,418 |
|
|
(0.4)% |
Construction |
|
|
12,346 |
|
|
|
11,631 |
|
|
6.1 |
% |
Investments |
|
|
158 |
|
|
|
158 |
|
|
— |
% |
Intersegment elimination |
|
|
(158 |
) |
|
|
(158 |
) |
|
— |
% |
Total Revenues |
|
$ |
25,705 |
|
|
$ |
25,049 |
|
|
2.6 |
% |
Healthcare revenue decreased 0.4% compared to
the prior year quarter, which reflects a slightly different mix of
business versus 2022. The increase in revenue for the Construction
division was driven by improved performance at both our KBS and
EBGL businesses.
Gross Profit
Gross profit (loss) in $ thousands |
|
Q1 2023 |
|
Q1 2022 |
|
% change |
Healthcare |
|
$ |
3,327 |
|
|
$ |
3,176 |
|
|
4.8 |
% |
Healthcare gross margin |
|
|
24.9 |
% |
|
|
23.7 |
% |
|
1.2 |
% |
Construction |
|
|
4,329 |
|
|
|
1,586 |
|
|
173.0 |
% |
Construction gross margin |
|
|
35.1 |
% |
|
|
13.6 |
% |
|
21.5 |
% |
Investments |
|
|
95 |
|
|
|
59 |
|
|
61.0 |
% |
Intersegment elimination |
|
|
(158 |
) |
|
|
(158 |
) |
|
N/M |
Total gross profit |
|
$ |
7,593 |
|
|
$ |
4,663 |
|
|
62.8 |
% |
Total gross margin |
|
|
29.5 |
% |
|
|
18.6 |
% |
|
10.9 |
% |
Healthcare gross profit increased 4.8% for the
three months ended March 31, 2023, compared to the same period
in the prior year and reflects a slightly different business mix
versus 2022.
The 173.0% increase in Construction gross profit
was predominately due to stronger pricing levels, lower input
costs, and improved operating efficiency versus Q1 2022.
Operating Expenses
On a consolidated basis, Q1 2023 sales, general
and administrative (“SG&A”) expenses decreased by
$0.4 million, or 5.2%, versus the prior year period. The major
driver of the decrease in SG&A was a $0.4 million decrease in
audit and tax service expense. SG&A as a percentage of revenue
decreased in Q1 2023 to 25.0% versus 27.1% in Q1 2022.
Net Income
Q1 2023 net income from continuing operations
was $0.4 million, or $0.03 per basic and diluted share, compared to
net loss of $3.7 million, or $0.29 per basic and diluted share in
the same period in the prior year. Q1 2023 non-GAAP adjusted net
income from continuing operations was $0.9 million, or $0.06 per
diluted share, compared to non-GAAP adjusted net loss from
continuing operations of $0.7 million, or $0.05 per diluted share,
in the prior year period.
Non-GAAP Adjusted EBITDA
Q1 2023 non-GAAP adjusted EBITDA was
$1.7 million versus of $0.1 million in the same quarter
of the prior year due to improvements in the Company’s operations
leading to increased gross profit at both our Healthcare and
Construction divisions.
Operating Cash Flow
Q1 2023 cash flow from operations was an inflow
of $5.1 million, compared to an outflow of $0.6 million for the
same period in the prior year, primarily as a result of improved
profitability at our operating businesses, particularly at our
Construction Division, higher collections of accounts receivable,
and lower SG&A expense.
Preferred Stock Dividends
In Q1 2023, the Company’s board of directors
declared a cash dividend to holders of our Series A Preferred Stock
of $0.25 per share, for an aggregate amount of approximately
$0.5 million. The record date for this dividend was March 1,
2023, and the payment date was March 10, 2023. As of March 31,
2023, the Company had no preferred dividends in arrears.
Conference Call Information
A conference call is scheduled for 10:00 a.m. ET
(7:00 a.m. PT) on May 15, 2023 to discuss the results and
management’s outlook. The call may be accessed by dialing (833)
630-1956 (toll free) or (412) 317-1837 (international), five
minutes prior to the scheduled start time and referencing Star
Equity. A simultaneous webcast of the call may be accessed online
from the Events & Presentations link on the Investor Relations
page at www.starequity.com/events-and-presentations/presentations;
an archived replay of the webcast will be available within 15
minutes of the end of the conference call.
If you have any questions, either prior to or
after our scheduled Earnings Conference call, please e-mail
admin@starequity.com or lcati@equityny.com.
Use of Non-GAAP Financial Measures by
Star Equity Holdings, Inc.
This release presents the non-GAAP financial
measures “adjusted net income (loss),” “adjusted net income (loss)
per basic and diluted share,” and “adjusted EBITDA from continuing
operations.” The most directly comparable measures for these
non-GAAP financial measures are “net income (loss),” “net income
(loss) per basic and diluted share,” and “cash flows from operating
activities.” The Company has included below unaudited adjusted
financial information, which presents the Company’s results of
operations after excluding acquired intangible asset amortization,
unrealized gain (loss) on equity securities and lumber derivatives,
litigation costs, financing costs, and income tax adjustments.
Further excluded in the measure of adjusted EBITDA are stock-based
compensation, interest, depreciation, and amortization.
A discussion of the reasons why management
believes that the presentation of non-GAAP financial measures
provides useful information to investors regarding the Company’s
financial condition and results of operations is included as
Exhibit 99.2 to the Company’s report on Form 8-K filed with the
Securities and Exchange Commission on May 15, 2023.
About Star Equity Holdings,
Inc.
Star Equity Holdings, Inc. is a diversified
holding company with two divisions: Construction and Investments.
Prior to the May 4, 2023 sale of Digirad Health, Star Equity
Holdings had three divisions: Healthcare, Construction and
Investments.
Healthcare
Our Healthcare division, which operated as
Digirad Health until the sale of Digirad Health on May 4, 2023,
provided products and services in the area of nuclear medical
imaging with a focus on cardiac health. Digirad Health operated
across the United States and comprises two lines of
business—imaging services offered to healthcare providers using a
fleet of our proprietary solid-state gamma cameras and the
manufacturing, distribution, and maintenance of our proprietary
solid-state gamma cameras.
Construction
Our Construction division manufactures modular
housing units for commercial and residential real estate projects
and operates in two businesses: (i) modular building manufacturing
and (ii) structural wall panel and wood foundation manufacturing,
including building supply distribution operations for professional
builders.
Investments
Our Investments division manages and finances the Company’s real
estate assets as well as its investment positions in private and
public companies.
Forward-Looking Statements
“Safe Harbor” Statement under the Private
Securities Litigation Reform Act of 1995: This release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements in this
release that are not statements of historical fact are hereby
identified as “forward-looking statements” for the purpose of the
safe harbor provided by Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Forward-looking Statements include, without limitation,
statements regarding (i) the plans and objectives of management for
future operations, including plans or objectives relating to
acquisitions and related integration, development of commercially
viable products, novel technologies, and modern applicable
services, (ii) projections of income (including income/loss),
EBITDA, earnings (including earnings/loss) per share, capital
expenditures, cost reductions, capital structure or other financial
items, (iii) the future financial performance of the Company or
acquisition targets and (iv) the assumptions underlying or relating
to any statement described above. Moreover, forward-looking
statements necessarily involve assumptions on the Company’s part.
These forward-looking statements generally are identified by the
words “believe”, “expect”, “anticipate”, “estimate”, “project”,
“intend”, “plan”, “should”, “may”, “will”, “would”, “will be”,
“will continue” or similar expressions. Such forward-looking
statements are not meant to predict or guarantee actual results,
performance, events or circumstances and may not be realized
because they are based upon the Company's current projections,
plans, objectives, beliefs, expectations, estimates and assumptions
and are subject to a number of risks and uncertainties and other
influences, many of which the Company has no control over. Actual
results and the timing of certain events and circumstances may
differ materially from those described above as a result of these
risks and uncertainties. Factors that may influence or contribute
to the inaccuracy of forward-looking statements or cause actual
results to differ materially from expected or desired results may
include, without limitation, the substantial amount of debt of the
Company and the Company’s ability to repay or refinance it or incur
additional debt in the future; the Company’s need for a significant
amount of cash to service and repay the debt and to pay dividends
on the Company’s preferred stock; the restrictions contained in the
debt agreements that limit the discretion of management in
operating the business; legal, regulatory, political and economic
risks in markets and public health crises that reduce economic
activity and cause restrictions on operations (including the recent
coronavirus COVID-19 outbreak); the length of time associated with
servicing customers; losses of significant contracts or failure to
get potential contracts being discussed; disruptions in the
relationship with third party vendors; accounts receivable
turnover; insufficient cash flows and resulting lack of liquidity;
the Company's inability to expand the Company's business;
unfavorable changes in the extensive governmental legislation and
regulations governing healthcare providers and the provision of
healthcare services and the competitive impact of such changes
(including unfavorable changes to reimbursement policies); high
costs of regulatory compliance; the liability and compliance costs
regarding environmental regulations; the underlying condition of
the technology support industry; the lack of product
diversification; development and introduction of new technologies
and intense competition in the healthcare industry; existing or
increased competition; risks to the price and volatility of the
Company’s common stock and preferred stock; stock volatility and in
liquidity; risks to preferred stockholders of not receiving
dividends and risks to the Company’s ability to pursue growth
opportunities if the Company continues to pay dividends according
to the terms of the Company’s preferred stock; the Company’s
ability to execute on its business strategy (including any cost
reduction plans); the Company’s failure to realize expected
benefits of restructuring and cost-cutting actions; the Company’s
ability to preserve and monetize its net operating losses; risks
associated with the Company’s possible pursuit of acquisitions; the
Company’s ability to consummate successful acquisitions and execute
related integration, as well as factors related to the Company’s
business including economic and financial market conditions
generally and economic conditions in the Company’s markets; failure
to keep pace with evolving technologies and difficulties
integrating technologies; system failures; losses of key management
personnel and the inability to attract and retain highly qualified
management and personnel in the future; and the continued demand
for and market acceptance of the Company’s services. For a detailed
discussion of cautionary statements and risks that may affect the
Company’s future results of operations and financial results,
please refer to the Company’s filings with the Securities and
Exchange Commission, including, but not limited to, the risk
factors in the Company’s most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q. This release reflects management’s
views as of the date presented.
All forward-looking statements are necessarily
only estimates of future results, and there can be no assurance
that actual results will not differ materially from expectations,
and, therefore, you are cautioned not to place undue reliance on
such statements. Further, any forward-looking statement speaks only
as of the date on which it is made, and we undertake no obligation
to update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events.
For more information contact: |
|
Star Equity Holdings,
Inc. |
The Equity Group |
Rick Coleman |
Lena Cati |
Chief Executive Officer |
Senior Vice President |
203-489-9508 |
212-836-9611 |
rick.coleman@starequity.com |
lcati@equityny.com |
(Financial tables follow)
Star Equity Holdings, Inc. |
Condensed Consolidated Statements of
Operations |
(Unaudited) (In thousands, except for per share
amounts) |
|
|
|
Three Months Ended March 31, |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues: |
|
|
|
|
Healthcare |
|
$ |
13,359 |
|
|
$ |
13,418 |
|
Construction |
|
|
12,346 |
|
|
|
11,631 |
|
Total revenues |
|
|
25,705 |
|
|
|
25,049 |
|
|
|
|
|
|
Cost of revenues: |
|
|
|
|
Healthcare |
|
|
10,032 |
|
|
|
10,242 |
|
Construction |
|
|
8,017 |
|
|
|
10,045 |
|
Investments |
|
|
63 |
|
|
|
99 |
|
Total cost of revenues |
|
|
18,112 |
|
|
|
20,386 |
|
|
|
|
|
|
Gross profit |
|
|
7,593 |
|
|
|
4,663 |
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
Selling, general and administrative |
|
|
6,433 |
|
|
|
6,788 |
|
Amortization of intangible assets |
|
|
430 |
|
|
|
430 |
|
Total operating expenses |
|
|
6,863 |
|
|
|
7,218 |
|
|
|
|
|
|
Income (loss) from
operations |
|
|
730 |
|
|
|
(2,555 |
) |
|
|
|
|
|
Other income (expense): |
|
|
|
|
Other income (expense), net |
|
|
(100 |
) |
|
|
(6 |
) |
Interest expense, net |
|
|
(195 |
) |
|
|
(190 |
) |
Total other income (expense), net |
|
|
(295 |
) |
|
|
(196 |
) |
|
|
|
|
|
Income (loss) before income
taxes |
|
|
435 |
|
|
|
(2,751 |
) |
Income tax benefit
(provision) |
|
|
— |
|
|
|
(950 |
) |
Net income (loss) |
|
|
435 |
|
|
|
(3,701 |
) |
Deemed dividend on Series A
perpetual preferred stock |
|
|
(479 |
) |
|
|
(479 |
) |
Net income (loss) attributable
to common shareholders |
|
$ |
(44 |
) |
|
$ |
(4,180 |
) |
|
|
|
|
|
Net income (loss) per
share |
|
|
|
|
Basic* |
|
$ |
0.03 |
|
|
$ |
(0.29 |
) |
Diluted* |
|
$ |
0.03 |
|
|
$ |
(0.29 |
) |
Net income (loss) per share,
attributable to common shareholders |
|
|
|
|
Basic* |
|
$ |
— |
|
|
$ |
(0.33 |
) |
Diluted* |
|
$ |
— |
|
|
$ |
(0.33 |
) |
Weighted-average common shares
outstanding |
|
|
|
|
Basic* |
|
|
15,516 |
|
|
|
12,669 |
|
Diluted* |
|
|
15,656 |
|
|
|
12,669 |
|
|
|
|
|
|
Dividends declared per share
of Series A perpetual preferred stock |
|
$ |
0.25 |
|
|
$ |
0.25 |
|
*Earnings per share may not add due to rounding
Star Equity Holdings, Inc. |
Condensed Consolidated Balance Sheets |
(Unaudited) (In thousands, except share
amounts) |
|
|
March 31,
2023(unaudited) |
|
December 31,2022 |
Assets: |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
5,655 |
|
|
$ |
4,665 |
|
Restricted cash |
|
141 |
|
|
|
142 |
|
Investments in equity securities |
|
3,577 |
|
|
|
3,490 |
|
Accounts receivable, net of allowances of $500 and $714,
respectively |
|
15,000 |
|
|
|
17,756 |
|
Inventories, net |
|
10,043 |
|
|
|
10,627 |
|
Other current assets |
|
2,239 |
|
|
|
2,587 |
|
Total current assets |
|
36,655 |
|
|
|
39,267 |
|
Property and equipment,
net |
|
8,102 |
|
|
|
8,348 |
|
Operating lease right-of-use
assets, net |
|
4,040 |
|
|
|
4,482 |
|
Intangible assets, net |
|
12,922 |
|
|
|
13,352 |
|
Goodwill |
|
6,046 |
|
|
|
6,046 |
|
Other assets |
|
1,736 |
|
|
|
1,807 |
|
Total assets |
$ |
69,501 |
|
|
$ |
73,302 |
|
|
|
|
|
Liabilities and
Stockholders’ Equity: |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
4,125 |
|
|
$ |
3,430 |
|
Accrued liabilities |
|
2,665 |
|
|
|
3,137 |
|
Accrued compensation |
|
4,025 |
|
|
|
3,701 |
|
Accrued warranty |
|
290 |
|
|
|
291 |
|
Lumber derivative contracts |
|
62 |
|
|
|
104 |
|
Deferred revenue |
|
2,926 |
|
|
|
3,376 |
|
Short-term debt |
|
8,394 |
|
|
|
11,682 |
|
Operating lease liabilities |
|
1,371 |
|
|
|
1,427 |
|
Finance lease liabilities |
|
348 |
|
|
|
397 |
|
Total current liabilities |
|
24,206 |
|
|
|
27,545 |
|
Deferred tax liabilities |
|
176 |
|
|
|
176 |
|
Operating lease liabilities,
net of current portion |
|
2,749 |
|
|
|
3,141 |
|
Finance lease liabilities, net
of current portion |
|
300 |
|
|
|
386 |
|
Deferred Revenue, net of
current portion |
|
257 |
|
|
|
299 |
|
Total liabilities |
|
27,688 |
|
|
|
31,547 |
|
|
|
|
|
Stockholders’
Equity: |
|
|
|
Series A Preferred stock, $0.0001 par value: 10,000,000 shares
authorized: 8,000,000 shares authorized, liquidation preference
($10.00 per share), 1,915,637 shares issued and outstanding at
March 31, 2023. (Liquidation preference: $18,988,390 as of
March 31, 2023.) |
|
18,988 |
|
|
|
18,988 |
|
Series C Preferred stock, $0.0001 par value: 25,000 shares
authorized; no shares issued or outstanding |
|
— |
|
|
|
— |
|
Common stock, $0.0001 par value: 50,000,000 shares authorized,
respectively; 15,192,753 and 15,177,919 shares issued and
outstanding (net of treasury shares) at March 31, 2023 and
December 31, 2022, respectively |
|
1 |
|
|
|
1 |
|
Treasury stock, at cost; 258,849 shares at March 31, 2023 and
December 31, 2022, respectively |
|
(5,728 |
) |
|
|
(5,728 |
) |
Additional paid-in
capital |
|
161,338 |
|
|
|
161,715 |
|
Accumulated deficit |
|
(132,786 |
) |
|
|
(133,221 |
) |
Total stockholders’ equity |
|
41,813 |
|
|
|
41,755 |
|
Total liabilities and stockholders’ equity |
$ |
69,501 |
|
|
$ |
73,302 |
|
Star Equity Holdings, Inc. |
Reconciliation of Non-GAAP Financial Measures |
(Unaudited) (In thousands, except per share
amounts) |
|
|
|
Three Months Ended March 31, |
|
|
|
2023 |
|
|
|
2022 |
|
Net income
(loss) |
|
$ |
435 |
|
|
$ |
(3,701 |
) |
Acquired intangible amortization |
|
|
430 |
|
|
|
430 |
|
Unrealized loss (gain) on equity securities(1) |
|
|
(2 |
) |
|
|
— |
|
Unrealized loss (gain) on lumber derivatives(2) |
|
|
(43 |
) |
|
|
676 |
|
Litigation costs(3) |
|
|
22 |
|
|
|
868 |
|
Financing costs(4) |
|
|
100 |
|
|
|
100 |
|
Income tax (benefit) provision |
|
|
— |
|
|
|
950 |
|
Non-GAAP adjusted net
income (loss) |
|
$ |
942 |
|
|
$ |
(677 |
) |
|
|
|
|
|
Net income (loss) per
diluted share |
|
|
0.03 |
|
|
|
(0.29 |
) |
Acquired intangible amortization |
|
|
0.03 |
|
|
|
0.03 |
|
Unrealized loss (gain) on equity securities(1) |
|
|
— |
|
|
|
— |
|
Unrealized loss (gain) on lumber derivatives(2) |
|
|
— |
|
|
|
0.05 |
|
Litigation costs(3) |
|
|
— |
|
|
|
0.07 |
|
Financing costs(4) |
|
|
0.01 |
|
|
|
0.01 |
|
Income tax (benefit) provision |
|
|
— |
|
|
|
0.07 |
|
Non-GAAP adjusted net
income (loss) per basic share(5) |
|
$ |
0.06 |
|
|
$ |
(0.05 |
) |
Non-GAAP adjusted net
income (loss) per diluted share(5) |
|
$ |
0.06 |
|
|
$ |
(0.05 |
) |
(1) Reflects adjustments for
any unrealized gains or losses in equity
securities.(2) Reflects adjustments for any
unrealized gains or losses in lumber derivatives
value.(3) Reflects one time litigation
costs.(4) Reflects financing costs from our credit
facilities.(5) Per share amounts are computed
independently for each discrete item presented. Therefore, the sum
of the quarterly per share amounts will not necessarily equal to
the total for the year, and the sum of individual items may not
equal the total.
Star Equity Holdings, Inc. |
Reconciliation of Non-GAAP Financial Measures |
(Unaudited) (In thousands) |
|
For The Three Months
Ended March 31, 2023 |
|
Healthcare |
|
Construction |
|
Investments |
|
Star Equity Corporate |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
419 |
|
$ |
1,654 |
|
|
$ |
(51 |
) |
|
$ |
(1,587 |
) |
|
$ |
435 |
|
Depreciation and
amortization |
|
|
272 |
|
|
505 |
|
|
|
63 |
|
|
|
4 |
|
|
|
844 |
|
Interest (income) expense |
|
|
168 |
|
|
29 |
|
|
|
22 |
|
|
|
(24 |
) |
|
|
195 |
|
Income tax (benefit)
provision |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
EBITDA |
|
|
859 |
|
|
2,188 |
|
|
|
34 |
|
|
|
(1,607 |
) |
|
|
1,474 |
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized loss (gain) on
equity securities(1) |
|
|
— |
|
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
(2 |
) |
Unrealized loss (gain) on
lumber derivatives(2) |
|
|
— |
|
|
(43 |
) |
|
|
— |
|
|
|
— |
|
|
|
(43 |
) |
Litigation costs(3) |
|
|
22 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
22 |
|
Stock-based compensation |
|
|
1 |
|
|
5 |
|
|
|
— |
|
|
|
96 |
|
|
|
102 |
|
Financing costs(4) |
|
|
5 |
|
|
84 |
|
|
|
11 |
|
|
|
— |
|
|
|
100 |
|
Non-GAAP adjusted
EBITDA |
|
$ |
887 |
|
$ |
2,234 |
|
|
$ |
43 |
|
|
$ |
(1,511 |
) |
|
$ |
1,653 |
|
For The Three Months
Ended March 31, 2022 |
|
Healthcare |
|
Construction |
|
Investments |
|
Star EquityCorporate |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(940 |
) |
|
$ |
(916 |
) |
|
$ |
88 |
|
$ |
(1,933 |
) |
|
$ |
(3,701 |
) |
Depreciation and
amortization |
|
|
315 |
|
|
|
487 |
|
|
|
99 |
|
|
— |
|
|
|
901 |
|
Interest expense |
|
|
64 |
|
|
|
79 |
|
|
|
47 |
|
|
— |
|
|
|
190 |
|
Income tax (benefit)
provision |
|
|
950 |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
950 |
|
EBITDA |
|
|
389 |
|
|
|
(350 |
) |
|
|
234 |
|
|
(1,933 |
) |
|
|
(1,660 |
) |
|
|
|
|
|
|
|
|
|
|
|
Unrealized loss (gain) on
lumber derivatives(2) |
|
|
— |
|
|
|
676 |
|
|
|
— |
|
|
— |
|
|
|
676 |
|
Litigation costs(3) |
|
|
868 |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
868 |
|
Stock-based compensation |
|
|
15 |
|
|
|
6 |
|
|
|
— |
|
|
123 |
|
|
|
144 |
|
Financing costs(4) |
|
|
5 |
|
|
|
78 |
|
|
|
17 |
|
|
— |
|
|
|
100 |
|
Non-GAAP adjusted
EBITDA |
|
$ |
1,277 |
|
|
$ |
410 |
|
|
$ |
251 |
|
$ |
(1,810 |
) |
|
$ |
128 |
|
(1) Reflects adjustments for
any unrealized gains or losses on equity
securities.(2) Reflects adjustments for any
unrealized gains or losses in lumber derivatives
value.(3) Reflects one time litigation
costs.(4) Reflects financing costs from our credit
facilities.
Star Equity Holdings, Inc. |
Supplemental Debt Information |
(Unaudited) (In thousands) |
|
A summary
of the Company’s credit facilities are as follows: |
|
|
March 31, 2023 |
|
December 31, 2022 |
|
|
Amount |
|
Weighted-AverageInterest Rate |
|
Amount |
|
Weighted-AverageInterest Rate |
Revolving Credit Facility - eCapital KBS |
|
$ |
— |
|
10.75 |
% |
|
$ |
— |
|
10.25 |
% |
Revolving Credit Facility -
eCapital EBGL |
|
|
— |
|
10.75 |
% |
|
|
2,592 |
|
10.25 |
% |
Revolving Credit Facility -
Webster |
|
|
7,685 |
|
7.36 |
% |
|
|
8,299 |
|
6.89 |
% |
Total Short-term
Revolving Credit Facilities |
|
$ |
7,685 |
|
7.36 |
% |
|
$ |
10,891 |
|
7.69 |
% |
eCapital - Star Loan
Principal, net |
|
$ |
709 |
|
11.00 |
% |
|
$ |
791 |
|
10.50 |
% |
Short Term
Loan |
|
$ |
709 |
|
11.00 |
% |
|
$ |
791 |
|
10.50 |
% |
Total Short-term
debt |
|
$ |
8,394 |
|
7.67 |
% |
|
$ |
11,682 |
|
7.88 |
% |
Star Equity Holdings, Inc. |
Supplemental Segment Information |
(Unaudited) (In thousands) |
|
|
|
Three Months EndedMarch
31, |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue by segment: |
|
|
|
|
Healthcare |
|
$ |
13,359 |
|
|
$ |
13,418 |
|
Construction |
|
|
12,346 |
|
|
|
11,631 |
|
Investments |
|
|
158 |
|
|
|
158 |
|
Intersegment elimination |
|
|
(158 |
) |
|
|
(158 |
) |
Consolidated revenue |
|
$ |
25,705 |
|
|
$ |
25,049 |
|
|
|
|
|
|
Gross profit (loss) by
segment: |
|
|
|
|
Healthcare |
|
$ |
3,327 |
|
|
$ |
3,176 |
|
Construction |
|
|
4,329 |
|
|
|
1,586 |
|
Investments |
|
|
95 |
|
|
|
59 |
|
Intersegment elimination |
|
|
(158 |
) |
|
|
(158 |
) |
Consolidated gross profit |
|
$ |
7,593 |
|
|
$ |
4,663 |
|
|
|
|
|
|
Income (loss) from continuing
operations by segment: |
|
|
|
|
Healthcare |
|
$ |
579 |
|
|
$ |
78 |
|
Construction |
|
|
1,782 |
|
|
|
(759 |
) |
Investments |
|
|
(19 |
) |
|
|
59 |
|
Corporate, eliminations and other |
|
|
(1,612 |
) |
|
|
(1,933 |
) |
Segment income (loss) from
operations |
|
$ |
730 |
|
|
$ |
(2,555 |
) |
|
|
|
|
|
Depreciation and amortization by
segment: |
|
|
|
|
Healthcare |
|
$ |
272 |
|
|
$ |
315 |
|
Construction |
|
|
505 |
|
|
|
487 |
|
Investments |
|
|
63 |
|
|
|
99 |
|
Star Equity corporate |
|
$ |
4 |
|
|
$ |
— |
|
Total depreciation and
amortization |
|
$ |
844 |
|
|
$ |
901 |
|
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