2016 Q2 Form 10-Q Financial Statement

#000121070816000058 Filed on July 28, 2016

View on sec.gov

Income Statement

Concept 2016 Q2 2015 Q2
Revenue $113.1M $122.7M
YoY Change -7.88% -18.75%
Cost Of Revenue $66.23M $72.52M
YoY Change -8.68% -20.48%
Gross Profit $46.84M $50.22M
YoY Change -6.74% -16.12%
Gross Profit Margin 41.43% 40.92%
Selling, General & Admin $48.32M $53.55M
YoY Change -9.78% -11.07%
% of Gross Profit 103.15% 106.63%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $800.0K $980.0K
YoY Change -18.37% -35.1%
% of Gross Profit 1.71% 1.95%
Operating Expenses $49.26M $56.58M
YoY Change -12.94% -9.81%
Operating Profit -$2.425M $13.64M
YoY Change -117.77% -576.2%
Interest Expense -$101.0K -$369.0K
YoY Change -72.63% 82.67%
% of Operating Profit -2.7%
Other Income/Expense, Net -$13.00K -$40.00K
YoY Change -67.5% -86.89%
Pretax Income -$2.539M $13.23M
YoY Change -119.19% -492.47%
Income Tax $808.0K $460.0K
% Of Pretax Income 3.48%
Net Earnings -$3.138M $13.88M
YoY Change -122.61% -417.26%
Net Earnings / Revenue -2.78% 11.31%
Basic Earnings Per Share
Diluted Earnings Per Share -$939.4K $4.088M
COMMON SHARES
Basic Shares Outstanding 33.25M shares 33.53M shares
Diluted Shares Outstanding 33.25M shares 34.01M shares

Balance Sheet

Concept 2016 Q2 2015 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $24.90M $34.80M
YoY Change -28.45% 94.41%
Cash & Equivalents $24.94M $34.84M
Short-Term Investments
Other Short-Term Assets $4.900M $8.500M
YoY Change -42.35% -18.27%
Inventory
Prepaid Expenses
Receivables $67.37M $75.51M
Other Receivables $0.00 $0.00
Total Short-Term Assets $97.16M $118.8M
YoY Change -18.24% -7.7%
LONG-TERM ASSETS
Property, Plant & Equipment $7.385M $8.228M
YoY Change -10.25% -44.78%
Goodwill $1.895M $2.027M
YoY Change -6.51% -0.1%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $4.369M $4.480M
YoY Change -2.48% -22.64%
Total Long-Term Assets $18.77M $18.42M
YoY Change 1.92% -32.23%
TOTAL ASSETS
Total Short-Term Assets $97.16M $118.8M
Total Long-Term Assets $18.77M $18.42M
Total Assets $115.9M $137.3M
YoY Change -15.54% -11.97%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $3.963M $4.407M
YoY Change -10.07% -46.1%
Accrued Expenses $44.80M $48.90M
YoY Change -8.38% -18.36%
Deferred Revenue
YoY Change
Short-Term Debt $7.163M $1.340M
YoY Change 434.55% -38.62%
Long-Term Debt Due $100.0K
YoY Change
Total Short-Term Liabilities $56.62M $57.02M
YoY Change -0.7% -18.81%
LONG-TERM LIABILITIES
Long-Term Debt $200.0K $0.00
YoY Change
Other Long-Term Liabilities $4.752M $4.317M
YoY Change 10.08% -34.59%
Total Long-Term Liabilities $4.752M $4.317M
YoY Change 10.08% -34.59%
TOTAL LIABILITIES
Total Short-Term Liabilities $56.62M $57.02M
Total Long-Term Liabilities $4.752M $4.317M
Total Liabilities $67.17M $68.64M
YoY Change -2.13% -21.39%
SHAREHOLDERS EQUITY
Retained Earnings -$438.3M -$423.6M
YoY Change 3.48% -0.65%
Common Stock $482.0M $480.4M
YoY Change 0.33% 0.87%
Preferred Stock
YoY Change
Treasury Stock (at cost) $4.027M $208.0K
YoY Change 1836.06% -54.39%
Treasury Stock Shares 1.597M shares 83.00K shares
Shareholders Equity $48.76M $68.62M
YoY Change
Total Liabilities & Shareholders Equity $115.9M $137.3M
YoY Change -15.54% -11.97%

Cashflow Statement

Concept 2016 Q2 2015 Q2
OPERATING ACTIVITIES
Net Income -$3.138M $13.88M
YoY Change -122.61% -417.26%
Depreciation, Depletion And Amortization $800.0K $980.0K
YoY Change -18.37% -35.1%
Cash From Operating Activities -$4.250M -$4.610M
YoY Change -7.81% -0.86%
INVESTING ACTIVITIES
Capital Expenditures -$550.0K -$630.0K
YoY Change -12.7% -49.6%
Acquisitions
YoY Change
Other Investing Activities $20.00K $24.71M
YoY Change -99.92%
Cash From Investing Activities -$530.0K $24.08M
YoY Change -102.2% -2026.4%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -1.410M 1.020M
YoY Change -238.24% -30.14%
NET CHANGE
Cash From Operating Activities -4.250M -4.610M
Cash From Investing Activities -530.0K 24.08M
Cash From Financing Activities -1.410M 1.020M
Net Change In Cash -6.190M 20.49M
YoY Change -130.21% -561.49%
FREE CASH FLOW
Cash From Operating Activities -$4.250M -$4.610M
Capital Expenditures -$550.0K -$630.0K
Free Cash Flow -$3.700M -$3.980M
YoY Change -7.04% 17.06%

Facts In Submission

Frame Concept Type Concept / XBRL Key Value Unit
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us-gaap Income Loss From Discontinued Operations Net Of Tax Attributable To Reporting Entity
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us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
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CY2015Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
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CY2015Q4 us-gaap Preferred Stock Shares Authorized
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SellingGeneralAndAdministrativeExpense
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P5Y
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us-gaap Weighted Average Number Of Diluted Shares Outstanding
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us-gaap Weighted Average Number Of Diluted Shares Outstanding
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us-gaap Weighted Average Number Of Shares Outstanding Basic
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us-gaap Weighted Average Number Of Shares Outstanding Basic
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us-gaap Description Of New Accounting Pronouncements Not Yet Adopted
DescriptionOfNewAccountingPronouncementsNotYetAdopted
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:12px;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-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No.&#160;2016-09,&#160;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">"Stock Compensation (Topic 718)" ("ASU 2016-09")</font><font style="font-family:inherit;font-size:10pt;">, &#160;which is intended to simplify several aspects of the accounting for share-based payment award transactions. ASU 2016-09 will be effective for the fiscal year beginning after December 15, 2016, including interim periods within that year. Early adoption is permitted. The Company is currently evaluating the impact to its consolidated financial statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In February 2016, the FASB issued ASU No. 2016-02, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">"Leases (Topic 842)" ("ASU 2016-02")</font><font style="font-family:inherit;font-size:10pt;">,&#160;which amends the existing standards for lease accounting. This new standard requires the recognition of lease assets and lease liabilities on the balance sheet and the disclosure of key information about leasing arrangements including the amounts, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 will be effective for the Company on January 1, 2019 and will require modified retrospective application as of the beginning of the earliest year presented in the financial statements. Early adoption is permitted. The Company is currently evaluating the impact to its consolidated financial statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In May 2014, the FASB issued ASU No. 2014-09, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">"Revenue from Contracts with Customers (Topic 606)."</font><font style="font-family:inherit;font-size:10pt;"> This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In July 2015, the FASB amended the effective date of this ASU to fiscal years beginning after December 15, 2017 and early adoption is permitted only for fiscal years beginning after December 15, 2016. In March, April and May 2016, the FASB issued ASU 2016-08 &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)</font><font style="font-family:inherit;font-size:10pt;">,&#8221; ASU 2016-10 &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing</font><font style="font-family:inherit;font-size:10pt;">,&#8221; and ASU 2016-12 "</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients</font><font style="font-family:inherit;font-size:10pt;">" which provide further clarifications to be considered when implementing ASU 2014-09. The Company plans to adopt this guidance on January 1, 2018. Companies may use either a full retrospective or a modified retrospective approach to adopt this ASU. The Company is currently evaluating the impact to its consolidated financial statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:36px;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>
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:36px;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 ("Hudson regional businesses" or "Hudson"). 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 ("RPO") and Talent Management Solutions.</font></div><div style="line-height:120%;padding-top:12px;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company operates in </font><font style="font-family:inherit;font-size:10pt;">12</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;font-weight:normal;">18</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:36px;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:36px;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:36px;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:36px;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:36px;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:36px;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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