Stock to Keep Your Eyes on: Hudson Global, Inc’s (NASDAQ: HSON)

On 05 Dec 18, Hudson Global, Inc’s (NASDAQ: HSON) negotiated 52,828 shares against it an average volume of 19,056 shares. The stock concluded the recent trade at $1.43 with upbeat/downbeat trend move of -1.38%. The company has total market value of 45.507M. The company has got a 52-week exceptional price of $2.4400 and reached a 52-week lowest of the share price at $1.2900.

Hudson Global, Inc. (HSON) reported recently financial results for the quarter ended September 30, 2018.

2018 Third Quarter Summary

  • Revenue of $17.1M raised 7.7 percent from the third quarter of 2017 and raised 11.6 percent in constant currency.
  • Gross profit of $10.9M reduced 2.6 percent from the third quarter of 2017 but raised 0.3 percent in constant currency.
  • Net loss of $0.9M, or $0.03 per basic and diluted share, contrast to net loss of $0.8M, or $0.03 per basic and diluted share, for the third quarter of 2017.  The results in the third quarter of 2017 included net loss from continuing operations of $0.5M and net loss from discontinued operations of $0.4M related to the sale of the recruitment and talent management businesses.
  • Adjusted EBITDA (Non-GAAP measure)* loss of $0.3M contrast to adjusted EBITDA of $0.2M in the third quarter of 2017.

Regional Highlights

The divested businesses are treated as discontinued operations, therefore the discussion below is focused on the continuing operations of the RPO business for all periods presented.  Previous period EBITDA and Adjusted EBITDA may not be comparable Because of regional support and infrastructure cost allocation treatment between continuing and discontinued operations following the divestitures.

Americas

In the third quarter of 2018, Americas’ revenue of $3.6M reduced 11 percent while gross profit of $3.0M reduced 19 percent contrast to the third quarter of 2017.  Growth in financial services and life sciences was offset by lower volumes elsewhere, particularly the conclusion of a large global contract that ended at the end of the third quarter of 2017.  EBITDA was $0.1M in the third quarter contrast to EBITDA of $0.5M a year ago.  The region delivered adjusted EBITDA of $0.3M for the third quarter contrast to adjusted EBITDA of $0.6M a year ago.

Liquidity and Capital Resources

The Company ended the third quarter of 2018 with $38.9M in cash, which includes $0.4M in restricted cash.  The Company had no credit facilities in place at the end of the third quarter of 2018, but remains in discussions with various lenders about new credit facilities to fund the working capital needs of the RPO business.  The Company used $0.1M in cash flow from operations during the third quarter contrast to generating $1.0M in cash flow from operations in the third quarter of 2017.  The cash flow statement in the third quarter of 2017 includes the recruitment and talent management businesses sold on March 31, 2018.

Business Outlook

With respect to forward-looking non-GAAP measures, a reconciliation of the non-GAAP measures to the corresponding GAAP measures is not accessible without unreasonable efforts Because of the variability, complexity and low visibility of the non-cash and other items described below that we exclude from the non-GAAP outlook measures.  The variability of these items is likely to have a important impact on our future GAAP financial results.

The Company expects RPO operations before corporate costs to generate adjusted EBITDA of $4.0M to $4.5M in 2018 versus previous guidance of $5.0M to $6.0M.  The reduction in guidance is Because of startup delays on two new projects as well as investments we are starting to make in technology, sales personnel, and marketing.  We expect corporate costs of $8.0M to $8.25M in 2018, including $2.4M of severance expense recorded in the first half of 2018.  As a result, the Company expects an adjusted EBITDA loss in 2018 of $3.5M to $4.25M.  Turning to the outlook for 2019, we continue to expect gross profit to grow over 10% versus 2018, and we believe adjusted EBITDA before corporate costs should grow faster than this rate.  Corporate costs are predictable to be on a run-rate of $4.0M in 2019, which we believe will enable Hudson to generate positive adjusted EBITDA in 2019.

The short ratio in the company’s stock is documented at 0.39 and the short float is around of 0.02%. The average true range of the stock is observed at 0.07 and the relative strength index of the stock is recorded at 44.61.

 

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