Revenue from Continuing Operations Increased
37.8%
BGSF, Inc. (NYSE: BGSF), a leading national provider of
workforce solutions, today reported financial results for its first
quarter ended March 27, 2022.
The Company further announced that its Board of Directors has
declared a quarterly cash dividend of $0.15 per share of common
stock. The dividend is payable on May 24, 2022 to all shareholders
of record as of the close of business on May 17, 2022. This marks
the 30th consecutive quarterly dividend and based on yesterday’s
closing price of the Company’s common stock, the annualized yield
is approximately 5%.
Net income for the first quarter 2022 was $15.5 million, or
$1.48 per diluted share, vs. a net income of $0.7 million, or $0.07
per diluted share in 2021. Adjusted EPS1 was $0.35 in 2022, up from
$0.13 in 2021.
Thirteen Weeks Ended
March 27,
2022
March 28,
2021
Net income (loss) from continuing
operations, excluding gain on sale of discontinued operations
$
2,354,618
$
(211,583
)
Gain on sale of discontinued operations,
net of tax
12,227,493
—
Net income from discontinued
operations
922,542
923,380
Total net income
$
15,504,653
$
711,797
Diluted earnings (loss) per share from
continuing operations
$
0.22
$
(0.02
)
Diluted earnings per share from gain on
sale of discontinued operations
1.17
—
Diluted earnings per share from
discontinued operations
0.09
0.09
Total diluted EPS
$
1.48
$
0.07
Q1 2022 Highlights from Continuing Operations:
- Revenues were $69 million, an increase of 37.8% from 2021
- Gross profit was $23.4 million, up 44.5% from 2021, while gross
profit percent increased 1.6% to 34.2% in 2022
- Selling, general and administrative expenses increased $4.4
million, or 28.8%, over 2021, primarily due to additional
compensation generated from increased overall gross profit
- Net income (loss) from continuing operations, excluding gain on
sale from discontinued operations was $2.4 million, or $0.22 per
diluted share, vs. net loss of $0.2 million, or $0.02 loss per
diluted share in 2021
- Adjusted EBITDA1 from continuing operations was $3.9 million
(5.7% of quarterly revenues), vs. $1.3 million (2.6% of quarterly
revenues) in 2021
- Adjusted EPS1 from continuing operations was $0.26 in 2022, up
from $.04 in 2021
“Our first quarter results are a great start to 2022 as we build
on the momentum created throughout 2021. Revenues improved
sequentially throughout the quarter, and first quarter’s results
exceeded our expectations in both the Professional and the Real
Estate division," said Beth A. Garvey, President and CEO.
“With strong first quarter results, we are optimistic in our
outlook for 2022. For the Real Estate segment, we expect a
continued market recovery and tailwinds from pent-up demand, and
for the Professional segment, we anticipate continued increases and
strong activity in IT Consulting and Managed Services sectors.
"We are optimistic about our business prospects for 2022 and are
operationally and financially well-positioned for growth during the
remainder of the year and beyond. The sale of our Light Industrial
segment earlier this year allowed us to reduce debt, while
investing more time, energy, and capital into higher margin
business. The Board of Directors approved our 30th consecutive
quarterly dividend payment, of $0.15 per share, signaling
confidence in our strategic initiatives and abilities to generate
significant cash flow. Looking ahead, we remain enthusiastic about
our enhanced IT infrastructure, momentum in our business segments,
and strong market position," concluded Garvey.
1 Non-GAAP financial measure. See reconciliation below for
details.
Conference Call BGSF call at 9:00 a.m. ET on April 28,
2022. Interested participants may dial 844-200-6205 (U.S. callers)
or 929-526-1599 (all other locations) and provide access code
464896. A replay of the call will be available one hour after the
call ends through May 5, 2022. To access the replay, please dial
929-458-6194 (U.S. Callers), 866-813-9403 (US Toll Free callers),
or +44 204-525-0658 (all other locations) and enter access code
382828. The live webcast and archived replay are accessible at the
investor relations section of the Company’s website at
www.bgsf.com.
About BGSF With its home office in Plano, Texas, BGSF
provides workforce solutions to a variety of industries through its
various divisions in IT, Cyber, Finance & Accounting, Creative,
and Real Estate (apartment communities and commercial buildings).
BGSF has integrated several regional and national brands achieving
scalable growth. The Company was ranked by Staffing Industry
Analysts as the 79th largest U.S. staffing company and the 48th
largest IT staffing firm in the 2021. The Company’s disciplined
acquisition philosophy, which builds value through both financial
growth and the retention of unique and dedicated talent within
BGSF’s family 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.bgsf.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.
Forward-looking statements may include, but are not limited to,
statements regarding our future financial performance and the
expectations and objectives of our board or management. The
Company’s actual results could differ materially from those
indicated by the forward-looking statements because of various
other 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 “allows,”
“believes,” “plans,” “expects,” “estimates,” “should,” “would,”
“may,” “might,” “forward,” “will,” “intends,” “continue,”
“outlook,” “temporarily,” “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.
BGSF, Inc. GAAP Financial Measures
On March 21, 2022, BGSF, Inc. completed the sale of
substantially all of our Light Industrial segment (“InStaff”)
assets. The following tables provide unaudited revenue, gross
profit, and operating income (expense), excluding gain on sale of
discontinued operations, by reportable segment, and additional
working capital and debt information from continuing
operations.
Thirteen Weeks Ended
March 27,
2022
March 28,
2021
(unaudited)
Revenue:
Real Estate
$
25,916,089
$
18,612,744
Professional
42,626,189
31,137,448
Total
$
68,542,278
$
49,750,192
Gross Profit:
Real Estate
$
9,970,861
$
6,865,523
Professional
13,459,938
9,349,185
Total Gross Profit
$
23,430,799
$
16,214,708
Gross Profit Percentage:
Real Estate
38.5
%
36.9
%
Professional
31.5
%
29.9
%
Company Gross Profit
34.2
%
32.6
%
Operating income (expense):
Real Estate
$
4,034,882
$
2,452,441
Professional
3,469,799
1,493,276
Home office
(4,689,167
)
(3,869,674
)
Total
$
2,815,514
$
76,043
As of
March 27,
2022
December 26,
2021
(unaudited)
Working capital:
Working capital
$
28,276,093
$
25,850,501
Working capital ratio
2.02
1.95
Debt:
Revolving line of credit, net
$
14,124,318
$
12,587,591
Term debt
$
—
$
26,862,500
BGSF, Inc. Non-GAAP Financial
Measures
The financial results of BGSF, 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 EBITDA as
defined in the credit agreement.
We define “Adjusted EBITDA" as earnings before interest expense,
income taxes, depreciation and amortization expense, transaction
fees and certain non-cash expenses such as impairment losses,
contingent consideration gains or losses, and share-based
compensation expense, as well as certain specific events that
management does not consider in assessing our on-going operating
performance.
Reconciliation of Net Income
from continuing operations to Adjusted EBITDA (Dollars in
thousands)
Thirteen Weeks Ended
March 27,
2022
March 28,
2021
TTM
Net income (loss) from continuing
operations, excluding gain on sale of discontinued operations
$
2,355
$
(212
)
$
13,024
Income tax expense (benefit) from
continuing operations
(108
)
(89
)
2,620
Interest expense, net
569
376
1,625
CARES Act credit
—
—
(2,084
)
Depreciation and amortization
899
837
3,761
Contingent consideration
—
—
(2,403
)
Share-based compensation
211
221
1,049
Transaction fees
—
136
35
Adjusted EBITDA from continuing
operations
3,926
1,269
17,627
Adjusted EBITDA from discontinued
operations
1,267
1,195
4,790
Adjusted EBITDA
$
5,193
$
2,464
$
22,417
We define “Adjusted EPS” as diluted earnings per share
eliminating amortization expense of intangible assets from
acquisitions, transaction fees, and certain non-cash expenses such
as impairment losses, contingent consideration gains or losses, as
well as certain specific events that management does not consider
in assessing our on-going operating performance, net of the
respective income tax effect.
Reconciliation of Adjusted
EPS
Thirteen Weeks Ended
March 27,
2022
March 28,
2021
Net income (loss) from continuing
operations per diluted share, excluding gain on sale of
discontinued operations
$
0.22
$
(0.02
)
Acquisition amortization
0.05
0.06
Transaction fees
—
0.01
Income tax expense adjustment
(0.01
)
(0.01
)
Adjusted EPS from continuing
operations
0.26
0.04
Adjusted EPS from discontinued
operations
0.09
0.09
Adjusted EPS
$
0.35
$
0.13
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version on businesswire.com: https://www.businesswire.com/news/home/20220427006131/en/
Steven Hooser or Sandy Martin Three Part Advisors
ir@bgstaffing.com 214.442.0016
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