2015 Q1 Form 10-Q Financial Statement

#000121070815000014 Filed on May 11, 2015

View on sec.gov

Income Statement

Concept 2015 Q1 2014 Q1
Revenue $124.3M $144.2M
YoY Change -13.77% -12.98%
Cost Of Revenue $76.41M $90.14M
YoY Change -15.23% -17.31%
Gross Profit $47.90M $54.03M
YoY Change -11.34% 5.95%
Gross Profit Margin 38.53% 37.48%
Selling, General & Admin $52.17M $55.92M
YoY Change -6.71% -9.21%
% of Gross Profit 108.9% 103.5%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $1.111M $1.488M
YoY Change -25.34% -9.71%
% of Gross Profit 2.32% 2.75%
Operating Expenses $52.17M $55.92M
YoY Change -6.71% -9.21%
Operating Profit -$6.716M -$3.374M
YoY Change 99.05% -60.94%
Interest Expense -$80.00K -$139.0K
YoY Change -42.45% -4.79%
% of Operating Profit
Other Income/Expense, Net $13.00K -$196.0K
YoY Change -106.63% -172.59%
Pretax Income -$6.783M -$3.710M
YoY Change 82.83% -55.93%
Income Tax -$129.0K $402.0K
% Of Pretax Income
Net Earnings -$6.838M -$4.544M
YoY Change 50.48% -44.87%
Net Earnings / Revenue -5.5% -3.15%
Basic Earnings Per Share -$0.14
Diluted Earnings Per Share -$2.061M -$0.14
COMMON SHARES
Basic Shares Outstanding 33.05M shares 32.64M shares
Diluted Shares Outstanding 33.05M shares 32.64M shares

Balance Sheet

Concept 2015 Q1 2014 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $13.90M $22.10M
YoY Change -37.1% -32.0%
Cash & Equivalents $13.89M $22.11M
Short-Term Investments
Other Short-Term Assets $8.300M $11.50M
YoY Change -27.83% -2.54%
Inventory
Prepaid Expenses
Receivables $79.51M $98.82M
Other Receivables $0.00 $0.00
Total Short-Term Assets $101.7M $132.9M
YoY Change -23.51% -9.77%
LONG-TERM ASSETS
Property, Plant & Equipment $8.895M $14.10M
YoY Change -36.93% -25.42%
Goodwill $2.028M $2.024M
YoY Change 0.2% -0.1%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $4.559M $5.918M
YoY Change -22.96% -1.1%
Total Long-Term Assets $19.49M $26.56M
YoY Change -26.63% -24.36%
TOTAL ASSETS
Total Short-Term Assets $101.7M $132.9M
Total Long-Term Assets $19.49M $26.56M
Total Assets $121.2M $159.5M
YoY Change -24.03% -12.58%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $6.529M $8.618M
YoY Change -24.24% 9.39%
Accrued Expenses $49.50M $63.30M
YoY Change -21.8% 6.57%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $547.0K
YoY Change -100.0%
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $58.92M $72.49M
YoY Change -18.72% 7.81%
LONG-TERM LIABILITIES
Long-Term Debt $0.00 $0.00
YoY Change
Other Long-Term Liabilities $4.265M $5.465M
YoY Change -21.96% -21.47%
Total Long-Term Liabilities $4.265M $5.465M
YoY Change -21.96% -21.47%
TOTAL LIABILITIES
Total Short-Term Liabilities $58.92M $72.49M
Total Long-Term Liabilities $4.265M $5.465M
Total Liabilities $70.72M $88.26M
YoY Change -19.88% 3.13%
SHAREHOLDERS EQUITY
Retained Earnings -$437.5M -$422.0M
YoY Change 3.67% 6.75%
Common Stock $477.2M $476.0M
YoY Change 0.24% 0.4%
Preferred Stock
YoY Change
Treasury Stock (at cost) $79.00K $967.0K
YoY Change -91.83% 32.1%
Treasury Stock Shares 25.00K shares 240.0K shares
Shareholders Equity $50.45M $71.23M
YoY Change
Total Liabilities & Shareholders Equity $121.2M $159.5M
YoY Change -24.03% -12.58%

Cashflow Statement

Concept 2015 Q1 2014 Q1
OPERATING ACTIVITIES
Net Income -$6.838M -$4.544M
YoY Change 50.48% -44.87%
Depreciation, Depletion And Amortization $1.111M $1.488M
YoY Change -25.34% -9.71%
Cash From Operating Activities -$18.37M -$13.63M
YoY Change 34.73% 261.4%
INVESTING ACTIVITIES
Capital Expenditures -$700.0K -$1.500M
YoY Change -53.33% 57.89%
Acquisitions
YoY Change
Other Investing Activities
YoY Change
Cash From Investing Activities -$695.0K -$1.498M
YoY Change -53.6% 58.35%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $0.00
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities $31.00K -$159.0K
YoY Change -119.5% -66.38%
NET CHANGE
Cash From Operating Activities -$18.37M -$13.63M
Cash From Investing Activities -$695.0K -$1.498M
Cash From Financing Activities $31.00K -$159.0K
Net Change In Cash -$19.03M -$15.29M
YoY Change 24.48% 194.53%
FREE CASH FLOW
Cash From Operating Activities -$18.37M -$13.63M
Capital Expenditures -$700.0K -$1.500M
Free Cash Flow -$17.67M -$12.13M
YoY Change 45.62% 329.91%

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CY2015Q1 us-gaap Description Of New Accounting Pronouncements Not Yet Adopted
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS</font></div><div style="line-height:120%;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In April 2015, the FASB issued Accounting Standards Update ("ASU") No. ASU 2015-03,&#160;&#8220;Simplifying the Presentation of Debt Issuance Costs,&#8221; ("ASU 2015-03") which amends the current presentation of debt issuance costs in the financial statements. ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts, instead of as an asset. The amendments are to be applied retrospectively and are effective for public business entities for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015, but early adoption is permitted. The Company does not believe the impact of its pending adoption of ASU 2015-03 on the Company's consolidated financial statements will be material.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In August 2014, the FASB issued ASU No. 2014-15, "Disclosure of Uncertainties about an Entity&#8217;s Ability to Continue as a Going Concern" ("ASU 2014-15"), to provide guidance on management&#8217;s responsibility to evaluate whether there is substantial doubt about a company&#8217;s ability to continue as a going concern within one year after the date that the financial statements are issued. ASU 2014-15 also provides guidance for related footnote disclosures. ASU 2014-15 is effective for the Company beginning on January 1, 2016 with early adoption permitted. The Company does not believe the impact of its pending adoption of ASU 2014-15 on the Company's consolidated financial statements will be material. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In June 2014, the FASB issued ASU No. 2014-12, "Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period" ("ASU 2014-12"). ASU 2014-12 requires that a performance target that affects vesting and could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Accounting Standards Codification ("ASC") 718, "Compensation - Stock Compensation," as it relates to such awards. ASU 2014-12 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015 with early adoption permitted using either of two methods: (i) prospective to all awards granted or modified after the effective date or (ii) retrospective to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter, with the cumulative effect of applying ASU 2014-12 as an adjustment to the opening retained earnings balance as of the beginning of the earliest annual period presented in the financial statements. Accordingly, the standard is effective for the Company beginning on January 1, 2016. The Company does not believe the impact of its pending adoption of ASU 2014-12 on the Company's consolidated financial statements will be material. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In May 2014, the FASB issued ASU No. 2014-09, &#8220;Revenue from Contracts with Customers (Topic 606)&#8221; (&#8220;ASU 2014-09&#8221;). ASU 2014-09 is a comprehensive new revenue recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. ASU 2014-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is not permitted. Accordingly, ASU 2014-09 is effective for the Company beginning on January 1, 2017. The Company is currently evaluating the impact that adopting ASU 2014-09 will have on the Company's financial condition, results of operations, and disclosures. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In April 2014, the FASB issued ASU No. 2014-08, &#8220;Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity&#8221; (&#8220;ASU 2014-08&#8221;). ASU No. 2014-08 raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. ASU 2014-08 is effective for fiscal years, and interim periods within those years, beginning on or after December 15, 2014. Accordingly, the standard was effective for the Company beginning on January 1, 2015. The Company has adopted ASU 2014-08. In the current quarter the Company divested and exited certain business. Under the new guidance, the exited businesses did not reach the thresholds required to qualify as discontinued operations and as a result the operations remain within the Company's continuing operations for all periods presented. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">There are no other recently issued accounting pronouncements that have had, or that the Company believes will have, a material impact on the Company's consolidated financial statements.</font></div></div>
CY2015Q1 us-gaap Nature Of Operations
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">DESCRIPTION OF BUSINESS</font></div><div style="line-height:120%;padding-top:12px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company is comprised of the operations, assets and liabilities of the three Hudson regional businesses of Hudson Americas, Hudson Asia Pacific, and Hudson Europe (&#8220;Hudson regional businesses&#8221; or &#8220;Hudson&#8221;). The Company provides specialized professional-level recruitment and related talent solutions. The Company&#8217;s core service offerings include Permanent Recruitment, Temporary Contracting, Recruitment Process Outsourcing (&#8220;RPO&#8221;) and Talent Management Solutions.</font></div><div style="line-height:120%;padding-top:12px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company operates in </font><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">18</font><font style="font-family:inherit;font-size:10pt;"> countries with </font><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">three</font><font style="font-family:inherit;font-size:10pt;"> reportable geographic business segments: Hudson Americas, Hudson Asia Pacific, and Hudson Europe. See Note </font><font style="font-family:inherit;font-size:10pt;color:#000000;font-weight:normal;text-decoration:none;">16</font><font style="font-family:inherit;font-size:10pt;"> for further details regarding the reportable segments. </font></div><div style="line-height:120%;padding-top:12px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Corporate expenses are reported separately from the reportable segments and pertain to certain functions, such as executive management, corporate governance, human resources, accounting, tax, marketing, information technology and treasury. A portion of these expenses are attributed to the reportable segments for providing the above services to them and have been allocated to the segments as management service fees and are included in the segments&#8217; non-operating other income (expense).</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company&#8217;s core service offerings include those services described below.</font></div><div style="line-height:120%;padding-top:12px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Permanent Recruitment:</font><font style="font-family:inherit;font-size:10pt;"> Offered on both a retained and contingent basis, Hudson&#8217;s Permanent Recruitment services leverage its consultants, psychologists and other professionals in the development and delivery of its proprietary methods to identify, select and engage the best-fit talent for critical client roles.</font></div><div style="line-height:120%;padding-top:12px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Temporary Contracting:</font><font style="font-family:inherit;font-size:10pt;"> In Temporary Contracting, Hudson provides a range of project management, interim management and professional contract staffing services. These services draw upon a combination of specialized recruiting and project management competencies to deliver a wide range of solutions. Hudson-employed professionals - either individually or as a team - are placed with client organizations for a defined period of time based on a client's specific business need.</font></div><div style="line-height:120%;padding-top:12px;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">RPO:</font><font style="font-family:inherit;font-size:10pt;"> Hudson RPO delivers both permanent recruitment and temporary contracting outsourced recruitment solutions tailored to the individual needs of primarily mid-to-large-cap multinational companies. Hudson RPO's delivery teams utilize state-of-the-art recruitment process methodologies and project management expertise in their flexible, turnkey solutions to meet clients' ongoing business needs. Hudson RPO services include complete recruitment outsourcing, project-based outsourcing, contingent workforce solutions and recruitment consulting.</font></div><div style="line-height:120%;padding-top:12px;text-align:justify;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Talent Management Solutions:</font><font style="font-family:inherit;font-size:10pt;"> Featuring embedded proprietary talent assessment and selection methodologies, Hudson&#8217;s Talent Management capability encompasses services such as talent assessment (utilizing a variety of competency, attitude and experiential testing), interview training, executive coaching, employee development and outplacement.</font></div></div>

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