UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of Report (Date of earliest event reported): August 3, 2010
Hudson
Highland Group, Inc.
(Exact
name of registrant as specified in its charter)
Delaware
(State
or other jurisdiction of incorporation)
|
000-50129
|
59-3547281
|
|
|
(Commission
File Number)
|
(IRS
Employer Identification No.)
|
560
Lexington Avenue
New
York, NY 10022
(Address
of Principal Executive Offices)
Registrant’s
telephone number, including area code (212) 351-7300
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
|
¨
|
Written communications pursuant
to Rule 425 under the Securities Act (16 CFR
230.425)
|
|
¨
|
Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (16 CFR
240.14a-12)
|
|
¨
|
Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (16 CFR
240.14d-2(b))
|
|
¨
|
Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (16 CFR
240.13e-4(c)
|
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL
CONDITION.
On August
3, 2010, Hudson Highland Group, Inc. issued a press release announcing its
financial results for the three and six months ended June 30, 2010. A copy
of such press release is furnished as Exhibit 99.1 to this Current
Report.
Also on
August 3, 2010, Hudson Highland Group, Inc. posted on its web site a Letter to
Shareholders, Employees and Friends, which discusses results for the three
months ended June 30, 2010. A copy of such letter is furnished as Exhibit
99.2 to this Current Report.
ITEM 9.01. FINANCIAL STATEMENTS AND
EXHIBITS.
(a)
Financial Statements.
None.
(b) Pro
Forma Financial Information.
None.
(c) Shell
Company Transactions
None.
(d)
Exhibits
|
99.1
|
Press Release of Hudson Highland
Group, Inc. issued on August 3,
2010.
|
|
99.2
|
Letter to Shareholders, Employees
and Friends issued on August 3, 2010 and posted to Company’s
website.
|
2
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this Report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
HUDSON
HIGHLAND GROUP, INC.
(Registrant)
|
|
|
By:
|
/s/ Mary
Jane
Raymond
|
|
Mary
Jane Raymond
|
|
|
Executive Vice President and
Chief
Financial
Officer
|
|
|
Dated:
August 3, 2010
|
|
3
Hudson
Highland Group, Inc.
Current
Report on Form 8-K
Exhibit
Index
|
Exhibit
Number
|
Description
|
|
|
99.1
|
Press
Release of Hudson Highland Group, Inc. issued on August 3,
2010.
|
|
|
99.2
|
Letter
to Shareholders, Employees and Friends issued on August 3, 2010 and posted
to Company’s website.
|
Exhibit
99.1
|
For Immediate Release
|
Contact:
|
David
F. Kirby
|
|
|
Hudson
Highland Group
|
|||
|
212-351-7216
|
|||
|
david.kirby@hudson.com
|
Hudson
Highland Group Reports
2010
Second Quarter Financial Results
NEW YORK, NY – August 3, 2010 –
Hudson Highland Group, Inc. (Nasdaq: HHGP), one of the world’s leading
providers of permanent recruitment, contract professionals and talent management
solutions, today announced financial results for the second quarter ended June
30, 2010.
2010
Second Quarter Summary
|
|
·
|
Revenue
of $195.0 million, an increase of 12.1 percent from $173.8 million for the
second quarter of 2009, and an increase of $14.9 million or 8.2 percent
from the first quarter of 2010
|
|
|
·
|
Gross
margin of $74.2 million, or 38.1 percent of revenue, up 14.4 percent from
$64.9 million, or 37.3 percent of revenue for the same period last year,
and an increase of $7.8 million or 11.8 percent from the first quarter of
2010
|
|
|
·
|
EBITDA* of
$3.1 million, or 1.6 percent of revenue, improved from an EBITDA loss of
$9.5 million for the second quarter of 2009, which included $3.6 million
of restructuring charges and $1.5 million of goodwill and other impairment
charges
|
|
|
·
|
Net income of $0.2 million, or
$0.01 per basic and diluted share, compared with net loss of $17.8
million, or $0.68 per basic and diluted share, for the second quarter of
2009
|
*
EBITDA is defined in the segment tables at the end of this release and includes
other non-operating income.
“Our
second quarter was highlighted by strong sequential gross margin growth across
every major geography, with particular strength in the U.K., Australia and
Asia,” said Jon Chait, Hudson Highland Group’s chairman and chief executive
officer. “We have not seen any signs of client pull back from our key
markets, but remain cautious given continuing uncertainties in the broader
global economy.”
“Our
operational cost discipline and targeted market investments have served us well
throughout this economic cycle, and helped our return to profitability,” said
Mary Jane Raymond, the company’s executive vice president and chief financial
officer.
Regional
Results
The
regional results in constant currency were as follows:
|
|
·
|
Europe
gross margin up 16 percent compared with second quarter 2009, and up 13
percent compared with first quarter 2010, led by 35 percent growth in the
U.K. compared with second quarter 2009 and 19 percent
sequentially
|
|
|
·
|
Australia
and New Zealand gross margin up 8 percent compared with second quarter
2009, and up 26 percent compared with first quarter 2010, led by an
increase of 40 percent in permanent recruitment compared with second
quarter 2009
|
|
|
·
|
Asia
gross margin up 43 percent compared with second quarter 2009 and up 16
percent compared with first quarter
2010
|
|
|
·
|
North
America gross margin down 5 percent compared with second quarter 2009, but
up 8 percent compared with first quarter
2010
|
Liquidity
and Capital Resources
The
company ended the second quarter of 2010 with $37.9 million in cash, an increase
from $24.1 million in cash at the end of the first quarter, including the
proceeds of the equity offering completed in early April 2010. The company had
$12.8 million in borrowings under its credit facilities.
The
company made certain changes to its credit facilities subsequent to quarter
end. It completed a new A$15 million ($13.5 million at
current exchange rates) credit agreement in Australia due to finding more
favorable terms, and accordingly, amended the Wells Fargo Foothill
agreement to include only the U.S. and U.K. receivables. The
availability under the new Australian agreement and the amended Wells Fargo
Foothill agreement is $15.2 million. The company is in the process
of considering other improvements to its remaining U.S. and U.K.
credit arrangements. Availability under other local country facilities is
$3.8 million for a total availability of
$19.0 million.
Guidance
The
company currently expects third quarter 2010 revenue of $190 - $200 million and
slightly positive EBITDA at prevailing exchange rates. This compares
with revenue of $169.6 million and an EBITDA loss of $6.0 million in the third
quarter of 2009.
Additional
Information
Additional
information about the company’s quarterly results can be found in the
shareholder letter and the quarterly earnings slides in the investor information
section of the company’s Web site at www.hudson.com.
Conference
Call/Webcast
Hudson
Highland Group will conduct a conference call Wednesday, August 4, 2010 at 9:00
a.m. ET to discuss this announcement. Individuals wishing to listen can access
the Web cast on the investor information section of the company's Web site at
www.hudson.com.
The
archived call will be available on the investor information section of the
company's Web site at www.hudson.com.
About
Hudson Highland Group
Hudson
Highland Group, Inc. is a leading provider of permanent recruitment, contract
professionals and talent management services worldwide. From single
placements to total outsourced solutions, Hudson helps clients achieve greater
organizational performance by assessing, recruiting, developing and engaging the
best and brightest people for their businesses. The company employs more
than 2,000 professionals serving clients and candidates in approximately 20
countries. More information is available at www.hudson.com.
Safe
Harbor Statement
This
press release contains statements that the company believes to be
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. All statements other than statements of
historical fact included in this press release, including statements regarding
the company’s future financial condition, results of operations, business
operations and business prospects, are forward-looking statements. Words such as
“anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “predict,”
“believe” and similar words, expressions and variations of these words and
expressions are intended to identify forward-looking statements. All
forward-looking statements are subject to important factors, risks,
uncertainties and assumptions, including industry and economic conditions’ that
could cause actual results to differ materially from those described in the
forward-looking statements. Such factors, risks, uncertainties and assumptions
include, but are not limited to, global economic fluctuations; the ability of
clients to terminate their relationship with the company at any time; risks
in collecting the company’s accounts receivable; the company’s history of
negative cash flows and operating losses may continue; the company’s
limited borrowing availability under its credit facility, which may negatively
impact its liquidity; restrictions on the company’s operating flexibility due to
the terms of its credit facility; risks related to fluctuations in the company’s
operating results from quarter to quarter; risks related to international
operations, including foreign currency fluctuations; risks associated with the
company’s investment strategy; risks and financial impact associated with
dispositions of underperforming assets; implementation of the company’s
cost reduction initiatives effectively; the company’s heavy reliance on
information systems and the impact of potentially losing or failing to develop
technology; competition in the company’s markets; the company’s
exposure to employment-related claims from both clients and employers and limits
on related insurance coverage; the company’s dependence on key management
personnel; the company’s ability to attract and retain highly skilled
professionals; volatility of the company’s stock price; the impact of
government regulations; and restrictions imposed by blocking arrangements.
Additional information concerning these and other factors is contained in the
company's filings with the Securities and Exchange Commission. These
forward-looking statements speak only as of the date of this document. The
company assumes no obligation, and expressly disclaims any obligation, to update
any forward-looking statements, whether as a result of new information, future
events or otherwise.
###
Financial
Tables Follow
HUDSON
HIGHLAND GROUP, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in
thousands, except share and per share amounts)
(unaudited)
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
June 30,
|
June 30,
|
|||||||||||||||
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||
|
Revenue
|
$ | 194,969 | $ | 173,848 | $ | 375,087 | $ | 338,998 | ||||||||
|
Direct
costs
|
120,732 | 108,964 | 234,430 | 212,110 | ||||||||||||
|
Gross
margin
|
74,237 | 64,884 | 140,657 | 126,888 | ||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Selling,
general and administrative expenses
|
71,411 | 69,329 | 139,743 | 141,030 | ||||||||||||
|
Depreciation
and amortization
|
2,186 | 2,840 | 4,472 | 6,628 | ||||||||||||
|
Business
reorganization and integration expenses
|
551 | 3,562 | 664 | 9,401 | ||||||||||||
|
Goodwill
and other impairment charges
|
- | 1,549 | - | 1,549 | ||||||||||||
|
Total
operating expenses
|
74,148 | 77,280 | 144,879 | 158,608 | ||||||||||||
|
Operating
income (loss)
|
89 | (12,396 | ) | (4,222 | ) | (31,720 | ) | |||||||||
|
Other
(expense) income:
|
||||||||||||||||
|
Interest,
net
|
(243 | ) | (182 | ) | (475 | ) | (372 | ) | ||||||||
|
Other,
net
|
846 | 54 | 1,501 | 674 | ||||||||||||
|
Income
(loss) from continuing operations before provision for income
taxes
|
692 | (12,524 | ) | (3,196 | ) | (31,418 | ) | |||||||||
|
Provision
for (benefit from) income taxes
|
515 | 2,975 | 766 | (1,085 | ) | |||||||||||
|
Income
(loss) from continuing operations
|
177 | (15,499 | ) | (3,962 | ) | (30,333 | ) | |||||||||
|
Income
(loss) from discontinued operations, net of income taxes
|
52 | (2,272 | ) | (17 | ) | 7,003 | ||||||||||
|
Net
income (loss)
|
$ | 229 | $ | (17,771 | ) | $ | (3,979 | ) | $ | (23,330 | ) | |||||
|
Basic
earnings (loss) per share:
|
||||||||||||||||
|
Income
(loss) from continuing operations
|
$ | 0.01 | $ | (0.59 | ) | $ | (0.14 | ) | $ | (1.18 | ) | |||||
|
Income
(loss) from discontinued operations
|
0.00 | (0.09 | ) | (0.00 | ) | 0.27 | ||||||||||
|
Net
income (loss)
|
$ | 0.01 | $ | (0.68 | ) | $ | (0.14 | ) | $ | (0.91 | ) | |||||
|
Diluted
earnings (loss) per share:
|
||||||||||||||||
|
Income
(loss) from continuing operations
|
$ | 0.01 | $ | (0.59 | ) | $ | (0.14 | ) | $ | (1.18 | ) | |||||
|
Income
(loss) from discontinued operations
|
0.00 | (0.09 | ) | (0.00 | ) | 0.27 | ||||||||||
|
Net
income (loss)
|
$ | 0.01 | $ | (0.68 | ) | $ | (0.14 | ) | $ | (0.91 | ) | |||||
|
Weighted
average shares outstanding:
|
||||||||||||||||
|
Basic
|
30,947 | 26,311 | 28,616 | 25,744 | ||||||||||||
|
Diluted
|
31,311 | 26,311 | 28,616 | 25,744 | ||||||||||||
CONDENSED
CONSOLIDATED BALANCE SHEETS
(in
thousands, except per share amounts)
(unaudited)
|
June 30,
|
December 31,
|
|||||||
|
2010
|
2009
|
|||||||
|
ASSETS
|
||||||||
|
Current
assets:
|
||||||||
|
Cash
and cash equivalents
|
$ | 37,896 | $ | 36,064 | ||||
|
Accounts
receivable, net
|
119,851 | 98,994 | ||||||
|
Prepaid
and other
|
13,703 | 13,308 | ||||||
|
Total
current assets
|
171,450 | 148,366 | ||||||
|
Property
and equipment, net
|
15,649 | 19,433 | ||||||
|
Other
assets
|
14,156 | 14,145 | ||||||
|
Total
assets
|
$ | 201,255 | $ | 181,944 | ||||
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable
|
$ | 9,389 | $ | 12,811 | ||||
|
Accrued
expenses and other current liabilities
|
72,608 | 54,103 | ||||||
|
Short-term
borrowings
|
12,748 | 10,456 | ||||||
|
Accrued
business reorganization expenses
|
3,370 | 8,784 | ||||||
|
Total
current liabilities
|
98,115 | 86,154 | ||||||
|
Other
non-current liabilities
|
8,531 | 10,768 | ||||||
|
Income
tax payable, non-current
|
8,026 | 8,415 | ||||||
|
Accrued
business reorganization expenses, non-current
|
667 | 347 | ||||||
|
Total
liabilities
|
115,339 | 105,684 | ||||||
|
Stockholders’
equity:
|
||||||||
|
Preferred
stock, $0.001 par value, 10,000 shares authorized; none issued or
outstanding
|
- | - | ||||||
|
Common
stock, $0.001 par value, 100,000 shares authorized; issued 32,178 and
26,836 shares, respectively
|
32 | 27 | ||||||
|
Additional
paid-in capital
|
465,786 | 445,541 | ||||||
|
Accumulated
deficit
|
(407,493 | ) | (403,514 | ) | ||||
|
Accumulated
other comprehensive income—translation adjustments
|
27,597 | 34,509 | ||||||
|
Treasury
stock, 1 and 114 shares, respectively, at cost
|
(6 | ) | (303 | ) | ||||
|
Total
stockholders’ equity
|
85,916 | 76,260 | ||||||
|
Total
liabilities and stockholders' equity
|
$ | 201,255 | $ | 181,944 | ||||
SEGMENT
ANALYSIS - QUARTER TO DATE
(in
thousands)
(unaudited)
|
For The Three Months Ended June 30, 2010
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 40,819 | $ | 80,717 | $ | 65,249 | $ | 8,184 | $ | - | $ | 194,969 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 10,039 | $ | 34,559 | $ | 21,723 | $ | 7,916 | $ | - | $ | 74,237 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 101 | $ | 450 | $ | - | $ | - | $ | - | $ | 551 | ||||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
393 | 1,148 | 1,015 | 38 | (3,440 | ) | (846 | ) | ||||||||||||||||
|
EBITDA
(Loss) (1)
|
$ | (991 | ) | $ | 2,466 | $ | 1,369 | $ | 1,311 | $ | (1,034 | ) | $ | 3,121 | ||||||||||
|
Depreciation
and amortization expenses
|
2,186 | |||||||||||||||||||||||
|
Interest
expense, net
|
243 | |||||||||||||||||||||||
|
Provision
for income taxes
|
515 | |||||||||||||||||||||||
|
Income
from discontinued operations, net of taxes
|
(52 | ) | ||||||||||||||||||||||
|
Net
income
|
$ | 229 | ||||||||||||||||||||||
|
For The Three Months Ended June 30, 2009
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 43,133 | $ | 68,187 | $ | 56,653 | $ | 5,875 | $ | - | $ | 173,848 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 10,512 | $ | 31,280 | $ | 17,661 | $ | 5,431 | $ | - | $ | 64,884 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 1,125 | $ | 2,328 | $ | (8 | ) | $ | 104 | $ | 13 | $ | 3,562 | |||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
531 | 690 | (243 | ) | 168 | (1,200 | ) | (54 | ) | |||||||||||||||
|
EBITDA
(Loss) (1)
|
(2,003 | ) | (2,220 | ) | 817 | (2,063 | ) | (4,033 | ) | (9,502 | ) | |||||||||||||
|
Depreciation
and amortization expenses
|
2,840 | |||||||||||||||||||||||
|
Interest
expense, net
|
182 | |||||||||||||||||||||||
|
Provision
for income taxes
|
2,975 | |||||||||||||||||||||||
|
Loss
from discontinued operations, net of taxes
|
2,272 | |||||||||||||||||||||||
|
Net
loss
|
$ | (17,771 | ) | |||||||||||||||||||||
|
For the Three Months Ended September 30, 2009
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 35,705 | $ | 67,898 | $ | 59,026 | $ | 7,018 | $ | - | $ | 169,647 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 9,264 | $ | 29,565 | $ | 18,755 | $ | 6,606 | $ | - | $ | 64,190 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 592 | $ | 1,881 | $ | 405 | $ | - | $ | - | $ | 2,878 | ||||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
569 | 554 | (12 | ) | 70 | (1,280 | ) | (99 | ) | |||||||||||||||
|
EBITDA
(Loss) (1)
|
$ | (2,795 | ) | $ | (2,406 | ) | $ | 1,155 | $ | 961 | $ | (2,913 | ) | $ | (5,998 | ) | ||||||||
|
Depreciation
and amortization expenses
|
2,741 | |||||||||||||||||||||||
|
Interest
expense, net
|
97 | |||||||||||||||||||||||
|
Benefit
from income taxes
|
(1,215 | ) | ||||||||||||||||||||||
|
Income
from discontinued operations, net of taxes
|
(770 | ) | ||||||||||||||||||||||
|
Net
loss
|
$ | (6,851 | ) | |||||||||||||||||||||
|
(1)
|
Non-GAAP
earnings before interest, income taxes, and depreciation and amortization
(“EBITDA”) are presented to provide additional information about the
company’s operations on a basis consistent with the measures which the
company uses to manage its operations and evaluate its performance.
Management also uses these measurements to evaluate capital needs and
working capital requirements. EBITDA should not be considered in isolation
or as a substitute for operating income, cash flows from operating
activities, and other income or cash flow statement data prepared in
accordance with generally accepted accounting principles or as a measure
of the company’s profitability or liquidity. Furthermore, EBITDA as
presented above may not be comparable with similarly titled measures
reported by other companies.
|
|
(2)
|
Prior
year revenue has been reclassed to conform to current year
presentation.
|
SEGMENT
ANALYSIS - YEAR TO DATE
(in
thousands)
(unaudited)
|
For The Six Months Ended June 30, 2010
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 80,325 | $ | 157,372 | $ | 122,071 | $ | 15,319 | $ | - | $ | 375,087 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 19,331 | $ | 67,074 | $ | 39,499 | $ | 14,753 | $ | - | $ | 140,657 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 243 | $ | 537 | $ | (116 | ) | $ | - | $ | - | $ | 664 | |||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
(116 | ) | 2,326 | 1,597 | 226 | (5,534 | ) | (1,501 | ) | |||||||||||||||
|
EBITDA
(Loss) (1)
|
$ | (1,232 | ) | $ | 2,901 | $ | 1,617 | $ | 1,907 | $ | (3,442 | ) | $ | 1,751 | ||||||||||
|
Depreciation
and amortization expenses
|
4,472 | |||||||||||||||||||||||
|
Interest
expense, net
|
475 | |||||||||||||||||||||||
|
Provision
for income taxes
|
766 | |||||||||||||||||||||||
|
Loss
from discontinued operations, net of taxes
|
17 | |||||||||||||||||||||||
|
Net
loss
|
$ | (3,979 | ) | |||||||||||||||||||||
|
For The Six Months Ended June 30, 2009
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 87,156 | $ | 134,575 | $ | 106,649 | $ | 10,618 | $ | - | $ | 338,998 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 21,482 | $ | 61,584 | $ | 33,964 | $ | 9,858 | $ | - | $ | 126,888 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 2,746 | $ | 4,666 | $ | 1,877 | $ | 98 | $ | 14 | $ | 9,401 | ||||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
1,136 | 882 | (70 | ) | (221 | ) | (2,401 | ) | (674 | ) | ||||||||||||||
|
EBITDA
(Loss) (1)
|
(7,393 | ) | (5,829 | ) | (935 | ) | (2,678 | ) | (7,583 | ) | (24,418 | ) | ||||||||||||
|
Depreciation
and amortization expenses
|
6,628 | |||||||||||||||||||||||
|
Interest
expense, net
|
372 | |||||||||||||||||||||||
|
Benefit
from income taxes
|
(1,085 | ) | ||||||||||||||||||||||
|
Incme
from discontinued operations, net of taxes
|
(7,003 | ) | ||||||||||||||||||||||
|
Net
loss
|
$ | (23,330 | ) | |||||||||||||||||||||
|
(1)
|
Non-GAAP
earnings before interest, income taxes, and depreciation and amortization
(“EBITDA”) are presented to provide additional information about the
company’s operations on a basis consistent with the measures which the
company uses to manage its operations and evaluate its performance.
Management also uses these measurements to evaluate capital needs and
working capital requirements. EBITDA should not be considered in isolation
or as a substitute for operating income, cash flows from operating
activities, and other income or cash flow statement data prepared in
accordance with generally accepted accounting principles or as a measure
of the company’s profitability or liquidity. Furthermore, EBITDA as
presented above may not be comparable with similarly titled measures
reported by other companies.
|
|
(2)
|
Prior
year revenue has been reclassed to conform to current year
presentation.
|
Reconciliation
For Constant Currency
(in
thousands)
(unaudited)
The
company defines the term “constant currency” to mean that financial data for a
period are translated into U.S. Dollars using the same foreign currency exchange
rates that were used to translate financial data for the previously reported
period. The company uses constant currency to depict the current period results
at the exchange rates of the prior period. Changes in revenues, direct costs,
gross margin and selling, general and administrative expenses include the effect
of changes in foreign currency exchange rates. Variance analysis usually
describes period-to-period variances that are calculated using constant currency
as a percentage. The company’s management reviews and analyzes business results
in constant currency and believes these results better represent the company’s
underlying business trends.
The
company believes that these calculations are a useful measure, indicating the
actual change in operations. Earnings from subsidiaries are rarely repatriated
to the United States, and there are no significant gains or losses on foreign
currency transactions between subsidiaries. Therefore, changes in foreign
currency exchange rates generally impact only reported earnings and not the
company’s economic condition.
|
2010
|
2009
|
|||||||||||||||
|
Currency
|
Constant
|
|||||||||||||||
|
As Reported
|
Translation
|
Currency
|
As Reported
|
|||||||||||||
|
Revenue:
|
||||||||||||||||
|
Hudson
Americas
|
$ | 40,819 | $ | (28 | ) | $ | 40,791 | $ | 43,133 | |||||||
|
Hudson
Europe
|
80,717 | 3,916 | 84,633 | 68,187 | ||||||||||||
|
Hudson
ANZ
|
65,249 | (8,566 | ) | 56,683 | 56,653 | |||||||||||
|
Hudson
Asia
|
8,184 | (158 | ) | 8,026 | 5,875 | |||||||||||
|
Total
|
194,969 | (4,836 | ) | 190,133 | 173,848 | |||||||||||
|
Direct
costs:
|
||||||||||||||||
|
Hudson
Americas
|
30,780 | - | 30,780 | 32,621 | ||||||||||||
|
Hudson
Europe
|
46,158 | 2,100 | 48,258 | 36,907 | ||||||||||||
|
Hudson
ANZ
|
43,526 | (5,905 | ) | 37,621 | 38,992 | |||||||||||
|
Hudson
Asia
|
268 | (6 | ) | 262 | 444 | |||||||||||
|
Total
|
120,732 | (3,811 | ) | 116,921 | 108,964 | |||||||||||
|
Gross
margin:
|
||||||||||||||||
|
Hudson
Americas
|
10,039 | (28 | ) | 10,011 | 10,512 | |||||||||||
|
Hudson
Europe
|
34,559 | 1,816 | 36,375 | 31,280 | ||||||||||||
|
Hudson
ANZ
|
21,723 | (2,661 | ) | 19,062 | 17,661 | |||||||||||
|
Hudson
Asia
|
7,916 | (152 | ) | 7,764 | 5,431 | |||||||||||
|
Total
|
$ | 74,237 | $ | (1,025 | ) | $ | 73,212 | $ | 64,884 | |||||||
|
Selling,
general and administrative (1)
|
||||||||||||||||
|
Hudson
Americas
|
$ | 11,223 | $ | (37 | ) | $ | 11,186 | $ | 12,049 | |||||||
|
Hudson
Europe
|
31,296 | 1,545 | 32,841 | 31,488 | ||||||||||||
|
Hudson
ANZ
|
19,883 | (2,771 | ) | 17,112 | 17,611 | |||||||||||
|
Hudson
Asia
|
6,689 | (135 | ) | 6,554 | 5,769 | |||||||||||
|
Corporate
|
4,506 | - | 4,506 | 5,252 | ||||||||||||
|
Total
|
$ | 73,597 | $ | (1,398 | ) | $ | 72,199 | $ | 72,169 | |||||||
|
(1)
|
Selling,
general and administrative expenses include depreciation and amortization
expenses.
|
Exhibit
99.2
To:
Shareholders, Employees and Friends
Hudson
Highland Group 2010 Second Quarter Financial Results
Market/Economic
Observations
In the
second quarter of 2010 our company made substantial progress towards recovery,
despite continued unsettled macroeconomic and geopolitical conditions. In the
second quarter of 2010, Hudson’s consolidated revenue increased 12 percent over
prior year, 9 percent in constant currency, and gross margin increased 14
percent over prior year, 13 percent in constant currency.
As we
discussed in prior quarters, we have been concerned for some time about the
impact of government actions to address the burgeoning public deficits in the
developed nations. These circumstances inevitably introduce some
risks to the performance of the staffing industry. We believe, however, that the
diversity of geographies and sectors in our company, as well as the experience
of our regional management teams, will benefit Hudson in this uncertain
environment. We were able to capitalize on positive economic trends in most of
our markets in the first half of 2010, and so far, we have not seen significant
changes in the behavior of our clients or candidates. Notwithstanding
uncertainty as to the second half of 2010 due to the much-discussed
macroeconomic factors, our businesses have produced solid results thus
far.
In this
early recovery period, the staffing industry has experienced a paradigm shift in
employer behavior. Contrary to historical precedents, permanent hiring is
recovering faster than temporary recruitment. Many companies, including
ours, are reporting stronger growth in permanent recruitment than in temporary
staffing by a wide margin, across all key geographic markets. While national
unemployment rates remain elevated, skilled and highly skilled employees are in
greater demand. It is difficult to cite any single reason for this behavior, but
certainly one factor is the transformation of the financial services industry
across many geographies. The financial services industry is shifting toward the
employment of managers capable of assessing, monitoring and reporting all
categories of risk in the operation of financial institutions. This is
driving increased hiring among the larger financial companies, particularly in
the middle office.
The
recovery continues to be led by large companies with strong balance sheets while
demand from SME customers has remained weak. From the standpoint of
the staffing industry, the mix shift toward larger clients is pushing margins
lower, as these larger employers have greater leverage on pricing than do
smaller companies. While the short-term impact of this dynamic is
lower margins, we believe that margins will stabilize by the end of this
year.
At
Hudson, we have seen improvements across the majority of our key markets so far
this year. In the second quarter, we saw particular strength in the United
Kingdom (U.K.), which was the largest contributor to the company’s profit and a
market in which we continued to post strong gains against our key competitors.
Our Asia business also excelled, with particular strength in IT. In
Australia-New Zealand (ANZ), the permanent recruitment business performed
admirably with revenue growth of 40 percent on a constant currency basis when
compared with the prior year period. As we anticipated, top line results in
continental Europe were mixed, but our operations produced a solid operating
profit before non-operating expense.
Our
profit metrics have benefitted from the expense initiatives we implemented in
2008 and 2009, allowing top-line improvements to translate into substantial
EBITDA growth. In the second quarter, Hudson produced EBITDA of $3.1 million,
within management’s guidance range of $1 - $4 million, including $0.8 million of
non-operating income. Year-over-year, on a gross margin increase of $9.4
million, EBITDA improved over $12.6 million, for leverage of 135 percent. In our
business, the second quarter is typically stronger than the first and this was
again the case in 2010. The third quarter is typically slower than the second
due to the seasonal impact of summer holidays
in the Northern Hemisphere.
Regional
Highlights
Europe
In the
second quarter of 2010, Hudson Europe’s gross margin increased 11 percent
compared with the prior year period, or 16 percent in constant currency. Gross
margin growth in the region was driven primarily by revenue increases in the
U.K., while continental Europe revenue remained relatively flat, both compared
with the prior quarter and prior year period. The U.K. has continued to recover,
with gross margin growth of 35 percent relative to the prior year period, and 19
percent sequentially compared with the prior quarter, both on a constant
currency basis. As previously noted, the U.K. was the largest contributor to the
company’s EBITDA in the second quarter.
The U.K.
government has announced its intention to reduce public spending over the next
four years by 25 percent. While this policy is only in its initial stages after
the announcement of the Emergency Budget in June, its impact is already being
felt. Hudson U.K. public sector gross margin amounted to £2.8 million in the
first half of 2010, about 13 percent of the total U.K. gross margin and a
decline from 23 percent in 2009. We expect further declines in the second half
of 2010, but do not believe that the declines will materially impact the U.K.’s
results from operations.
Results
across continental Europe were mixed, with the region producing an increase in
gross margin sequentially and slight growth compared with the prior year period,
both in constant currency. Strength in Belgium and France was offset by a sharp
decline in Balance in the Netherlands, which continues to suffer from increased
competition in the public sector. Despite
challenging conditions, continental Europe’s EBITDA was $1.6 million before
non-operating expense, up from approximately breakeven in the prior year
period.
On a
year-over-year gross margin increase of $3.3 million, Hudson Europe achieved
EBITDA growth of $4.7 million, delivering $2.5 million including $1.1 million of
non-operating costs primarily from corporate allocations. Excluding these costs,
the region produced EBITDA of $3.6 million, compared with a loss of $1.5 million
in the prior year period.
|
Hudson
Europe:
|
United Kingdom
|
Continental Europe
|
Total Europe
|
|||||||||||||||||||||
|
(In
thousands)
|
Q2 2010
|
Q2 2009
|
Q2 2010
|
Q2 2009
|
Q2 2010
|
Q2 2009
|
||||||||||||||||||
|
Gross
margin
|
$ | 16,816 | $ | 13,021 | $ | 17,743 | $ | 18,258 | $ | 34,559 | $ | 31,280 | ||||||||||||
|
SG&A
|
14,365 | 13,746 | 16,131 | 16,735 | 30,495 | 30,482 | ||||||||||||||||||
|
Reorganization
cost
|
474 | 839 | (25 | ) | 1,489 | 450 | 2,328 | |||||||||||||||||
|
Gross
margin less SG&A & reorg
|
1,977 | (1,564 | ) | 1,638 | 34 | 3,614 | (1,530 | ) | ||||||||||||||||
|
Non-operating
expense, including corporate administrative charges
|
(504 | ) | (315 | ) | 1,652 | 1,005 | 1,148 | 690 | ||||||||||||||||
|
EBITDA
|
2,481 | (1,248 | ) | (14 | ) | (971 | ) | 2,466 | (2,220 | ) | ||||||||||||||
Australia
and New Zealand
In the
second quarter, ANZ’s gross margin increased 23 percent from the prior year
period, or 8 percent in constant currency. Gross margin growth came primarily
from permanent recruitment revenue, which increased 40 percent in constant
currency, offset by a decline in countercyclical outplacement services in the
Talent Management business. Temporary contracting gross margin was
nearly flat compared with the prior year period in constant currency. Compared
with the first quarter of 2010, gross margin increased 22 percent on a reported
basis, also driven primarily by permanent recruitment and a sequential lift in
other Talent Management business. EBITDA for the quarter was $1.4 million,
including $1.0 million in non-operating costs. Excluding these costs, the region
produced EBITDA of $2.4 million, compared with $0.6 million in the prior year
period.
|
Hudson
ANZ
|
Q2 2010
|
Q2 2009
|
||||||
|
(In
thousands)
|
||||||||
|
Gross
margin
|
$ | 21,723 | $ | 17,661 | ||||
|
SG&A
|
19,339 | 17,095 | ||||||
|
Reorganization
cost
|
- | (8 | ) | |||||
|
Gross
margin less SG&A & reorg
|
2,384 | 574 | ||||||
|
Non-operating
expense, including corporate
administrative charges
|
1,015 | (243 | ) | |||||
|
EBITDA
|
1,369 | 817 | ||||||
Asia
In the
second quarter, our Asia business continued to capitalize on improving economic
conditions in the region. Gross margin increased 43 percent in constant currency
from the prior year period, and 16 percent sequentially on a reported and
constant currency basis, resulting from greater consultant productivity and
higher average fees per placement. Growth occurred in all of our markets led by
China and was driven by strength in virtually all practices. Growth
in Singapore and Hong Kong was driven by strength in Accounting, IT and Banking.
EBITDA in the second quarter was $1.3 million, or 16 percent of revenue, an
improvement from a loss of $2.1 million in the prior year period, with leverage
for the quarter of over 130 percent. Non-operating expense for Asia was less
than $0.1 million in the second quarter.
|
Hudson Asia
|
Q2 2010
|
Q2 2009
|
||||||
|
(In
thousands)
|
||||||||
|
Gross
margin
|
$ | 7,916 | $ | 5,431 | ||||
|
SG&A
|
6,567 | 5,553 | ||||||
|
Reorganization
cost
|
- | 104 | ||||||
|
Gross
margin less SG&A & reorg
|
1,348 | (225 | ) | |||||
|
Goodwill
impairment
|
- | 1,669 | ||||||
|
Non-operating
expense, including corporate
administrative charges
|
38 | 168 | ||||||
|
EBITDA
|
1,311 | (2,063 | ) | |||||
Americas
Hudson
Americas’ gross margin declined approximately 5 percent from the prior year
period and improved 8 percent sequentially from the first quarter of 2010. Gross
margin results benefited from small increases in contractors on billing in the
Legal business, both compared with the prior quarter and prior year period,
offset by fewer contractors in the higher margin Accounting and Finance
business. We have seen consistent growth in the IT business since the beginning
of 2010. The temporary contracting gross margin percentage improved 130 basis
points from the prior quarter to 22.1 percent, mostly due to mix, and was flat
compared with the prior year period. EBITDA was a loss of $1.0 million,
including $0.4 million of non-operating expense, an improvement from a loss of
$2.0 million in the prior year period but below our
expectations.
|
Hudson Americas
|
Q2 2010
|
Q2 2009
|
||||||
|
(In
thousands)
|
||||||||
|
Gross
margin
|
$ | 10,039 | $ | 10,512 | ||||
|
SG&A
|
10,536 | 10,980 | ||||||
|
Reorganization
cost
|
101 | 1,125 | ||||||
|
Gross
margin less SG&A & reorg
|
(598 | ) | (1,592 | ) | ||||
|
Goodwill
impairment
|
- | (120 | ) | |||||
|
Non-operating
expense, including corporate
administrative charges
|
393 | 531 | ||||||
|
EBITDA
|
(991 | ) | (2,003 | ) | ||||
Corporate
Corporate
expenses were $4.5 million before allocations, representing a decrease from $5.2
million in the second quarter of 2009, driven by lower professional
fees. After the corporate allocations to the field, the net corporate
expense was $1.0 million.
Liquidity
and Capital Resources
The
company ended the second quarter of 2010 with $37.9 million in cash, an increase
from $24.1 million in cash at the end of the first quarter, including the
proceeds of the equity offering completed in early April 2010. The company had
$12.8 million in borrowings under its credit facilities.
The
company made certain changes to its credit facilities subsequent to quarter
end. It completed a new A$15 million ($13.5 million at
current exchange rates) credit agreement in Australia due to finding more
favorable terms, and accordingly, amended the Wells Fargo Foothill
agreement to include only the U.S. and U.K. receivables. The
availability under the new Australian agreement and the amended Wells Fargo
Foothill agreement is $15.2 million. The company is in the process
of considering other improvements to its remaining U.S. and U.K.
credit arrangements. Availability under other local country facilities is
$3.8 million for a total availability of
$19.0 million.
Guidance
The
company currently expects third quarter 2010 revenue of $190 - $200 million and
slightly positive EBITDA at prevailing exchange rates. This compares
with revenue of $169.6 million and an EBITDA loss of $6.0 million in the third
quarter of 2009.
Safe
Harbor Statement
This letter contains statements that
the company believes to be "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. All statements other than
statements of historical fact included in this letter, including those under the
caption “Guidance” and other statements regarding the company's future financial
condition, results of operations, business operations and business prospects,
are forward-looking statements. Words such as "anticipate," "estimate,"
"expect," "project," "intend," "plan," "predict," "believe" and similar words,
expressions and variations of these words and expressions are intended to
identify forward-looking statements. All forward-looking statements are subject
to risks and uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. These factors include,
but are not limited to, the impact of global economic fluctuations including the
current economic downturn; the ability of clients to terminate their
relationship with the company at any time; risks in collecting our accounts
receivable; implementation of the company’s cost reduction initiatives
effectively; the company’s history of negative cash flows and operating losses
may continue; the company's limited borrowing availability under our credit
facility, which may negatively impact our liquidity; restrictions on the
company’s operating flexibility due to the terms of its credit facility;
fluctuations in the company’s operating results from quarter to quarter; risks
relating to the company’s international operations, including foreign currency
fluctuations; risks related to our investment strategy; risks and financial
impact associated with dispositions of underperforming assets; the company’s
heavy reliance on information systems and the impact of potentially losing or
failing to develop technology; competition in the company’s markets and the
company’s dependence on highly skilled professionals; the company’s exposure to
employment-related claims from both clients and employers and limits on related
insurance coverage; the company’s dependence on key management personnel;
volatility of stock price; the impact of government regulations; financial
impact of audits by various taxing authorities; and restrictions imposed by
blocking arrangements. Additional information concerning these and other factors
is contained in the company's filings with the Securities and Exchange
Commission. These forward-looking statements speak only as of the date of this
letter. The company assumes no obligation, and expressly disclaims any
obligation, to review or confirm analysts' expectations or estimates or to
update any forward-looking statements, whether as a result of new information,
future events or otherwise.
###
Financial
Tables Follow
HUDSON
HIGHLAND GROUP, INC.
SEGMENT
ANALYSIS - QUARTER TO DATE
(in
thousands)
(unaudited)
|
For The Three Months Ended June 30, 2010
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 40,819 | $ | 80,717 | $ | 65,249 | $ | 8,184 | $ | - | $ | 194,969 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 10,039 | $ | 34,559 | $ | 21,723 | $ | 7,916 | $ | - | $ | 74,237 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 101 | $ | 450 | $ | - | $ | - | $ | - | $ | 551 | ||||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
393 | 1,148 | 1,015 | 38 | (3,440 | ) | (846 | ) | ||||||||||||||||
|
EBITDA
(Loss) (1)
|
$ | (991 | ) | $ | 2,466 | $ | 1,369 | $ | 1,311 | $ | (1,034 | ) | $ | 3,121 | ||||||||||
|
Depreciation
and amortization expenses
|
2,186 | |||||||||||||||||||||||
|
Interest
expense, net
|
243 | |||||||||||||||||||||||
|
Provision
for income taxes
|
515 | |||||||||||||||||||||||
|
Income
from discontinued operations, net of taxes
|
(52 | ) | ||||||||||||||||||||||
|
Net
income
|
$ | 229 | ||||||||||||||||||||||
|
For The Three Months Ended June 30, 2009
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 43,133 | $ | 68,187 | $ | 56,653 | $ | 5,875 | $ | - | $ | 173,848 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 10,512 | $ | 31,280 | $ | 17,661 | $ | 5,431 | $ | - | $ | 64,884 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 1,125 | $ | 2,328 | $ | (8 | ) | $ | 104 | $ | 13 | $ | 3,562 | |||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
531 | 690 | (243 | ) | 168 | (1,200 | ) | (54 | ) | |||||||||||||||
|
EBITDA
(Loss) (1)
|
(2,003 | ) | (2,220 | ) | 817 | (2,063 | ) | (4,033 | ) | (9,502 | ) | |||||||||||||
|
Depreciation
and amortization expenses
|
2,840 | |||||||||||||||||||||||
|
Interest
expense, net
|
182 | |||||||||||||||||||||||
|
Provision
for income taxes
|
2,975 | |||||||||||||||||||||||
|
Loss
from discontinued operations, net of taxes
|
2,272 | |||||||||||||||||||||||
|
Net
loss
|
$ | (17,771 | ) | |||||||||||||||||||||
|
For the Three Months Ended September 30, 2009
|
Hudson
Americas
|
Hudson
Europe
|
Hudson ANZ
|
Hudson Asia
|
Corporate
|
Total
|
||||||||||||||||||
|
Revenue,
from external customers
|
$ | 35,705 | $ | 67,898 | $ | 59,026 | $ | 7,018 | $ | - | $ | 169,647 | ||||||||||||
|
Gross
margin, from external customers
|
$ | 9,264 | $ | 29,565 | $ | 18,755 | $ | 6,606 | $ | - | $ | 64,190 | ||||||||||||
|
Business
reorganization and integration expenses (recovery)
|
$ | 592 | $ | 1,881 | $ | 405 | $ | - | $ | - | $ | 2,878 | ||||||||||||
|
Non-operating
expense (income), including corporate administration
charges
|
569 | 554 | (12 | ) | 70 | (1,280 | ) | (99 | ) | |||||||||||||||
|
EBITDA
(Loss) (1)
|
$ | (2,795 | ) | $ | (2,406 | ) | $ | 1,155 | $ | 961 | $ | (2,913 | ) | $ | (5,998 | ) | ||||||||
|
Depreciation
and amortization expenses
|
2,741 | |||||||||||||||||||||||
|
Interest
expense, net
|
97 | |||||||||||||||||||||||
|
Benefit
from income taxes
|
(1,215 | ) | ||||||||||||||||||||||
|
Income
from discontinued operations, net of taxes
|
(770 | ) | ||||||||||||||||||||||
|
Net
loss
|
$ | (6,851 | ) | |||||||||||||||||||||
|
(1)
|
Non-GAAP
earnings before interest, income taxes, and depreciation and amortization
(“EBITDA”) are presented to provide additional information about the
company’s operations on a basis consistent with the measures which the
company uses to manage its operations and evaluate its performance.
Management also uses these measurements to evaluate capital needs and
working capital requirements. EBITDA should not be considered in isolation
or as a substitute for operating income, cash flows from operating
activities, and other income or cash flow statement data prepared in
accordance with generally accepted accounting principles or as a measure
of the company’s profitability or liquidity. Furthermore, EBITDA as
presented above may not be comparable with similarly titled measures
reported by other companies.
|
|
(2)
|
Prior
year revenue has been reclassed to conform to current year
presentation.
|
Reconciliation
For Constant Currency
(in
thousands)
(unaudited)
The
company defines the term “constant currency” to mean that financial data for a
period are translated into U.S. Dollars using the same foreign currency exchange
rates that were used to translate financial data for the previously reported
period. The company uses constant currency to depict the current period results
at the exchange rates of the prior period. Changes in revenues, direct costs,
gross margin and selling, general and administrative expenses include the effect
of changes in foreign currency exchange rates. Variance analysis usually
describes period-to-period variances that are calculated using constant currency
as a percentage. The company’s management reviews and analyzes business results
in constant currency and believes these results better represent the company’s
underlying business trends.
The
company believes that these calculations are a useful measure, indicating the
actual change in operations. Earnings from subsidiaries are rarely repatriated
to the United States, and there are no significant gains or losses on foreign
currency transactions between subsidiaries. Therefore, changes in foreign
currency exchange rates generally impact only reported earnings and not the
company’s economic condition.
|
2010
|
2009
|
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|
Currency
|
Constant
|
|||||||||||||||
|
As Reported
|
Translation
|
Currency
|
As Reported
|
|||||||||||||
|
Revenue:
|
||||||||||||||||
|
Hudson
Americas
|
$ | 40,819 | $ | (28 | ) | $ | 40,791 | $ | 43,133 | |||||||
|
Hudson
Europe
|
80,717 | 3,916 | 84,633 | 68,187 | ||||||||||||
|
Hudson
ANZ
|
65,249 | (8,566 | ) | 56,683 | 56,653 | |||||||||||
|
Hudson
Asia
|
8,184 | (158 | ) | 8,026 | 5,875 | |||||||||||
|
Total
|
194,969 | (4,836 | ) | 190,133 | 173,848 | |||||||||||
|
Direct
costs:
|
||||||||||||||||
|
Hudson
Americas
|
30,780 | - | 30,780 | 32,621 | ||||||||||||
|
Hudson
Europe
|
46,158 | 2,100 | 48,258 | 36,907 | ||||||||||||
|
Hudson
ANZ
|
43,526 | (5,905 | ) | 37,621 | 38,992 | |||||||||||
|
Hudson
Asia
|
268 | (6 | ) | 262 | 444 | |||||||||||
|
Total
|
120,732 | (3,811 | ) | 116,921 | 108,964 | |||||||||||
|
Gross
margin:
|
||||||||||||||||
|
Hudson
Americas
|
10,039 | (28 | ) | 10,011 | 10,512 | |||||||||||
|
Hudson
Europe
|
34,559 | 1,816 | 36,375 | 31,280 | ||||||||||||
|
Hudson
ANZ
|
21,723 | (2,661 | ) | 19,062 | 17,661 | |||||||||||
|
Hudson
Asia
|
7,916 | (152 | ) | 7,764 | 5,431 | |||||||||||
|
Total
|
$ | 74,237 | $ | (1,025 | ) | $ | 73,212 | $ | 64,884 | |||||||
|
Selling,
general and administrative (1)
|
||||||||||||||||
|
Hudson
Americas
|
$ | 11,223 | $ | (37 | ) | $ | 11,186 | $ | 12,049 | |||||||
|
Hudson
Europe
|
31,296 | 1,545 | 32,841 | 31,488 | ||||||||||||
|
Hudson
ANZ
|
19,883 | (2,771 | ) | 17,112 | 17,611 | |||||||||||
|
Hudson
Asia
|
6,689 | (135 | ) | 6,554 | 5,769 | |||||||||||
|
Corporate
|
4,506 | - | 4,506 | 5,252 | ||||||||||||
|
Total
|
$ | 73,597 | $ | (1,398 | ) | $ | 72,199 | $ | 72,169 | |||||||
(1) Selling,
general and administrative expenses include depreciation and amortization
expenses.