Market Overview

Resources Connection, Inc. Reports First Quarter Results for Fiscal 2020

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First Quarter Fiscal 2020 Highlights:

  • Revenue $172.2 million, down 3.6% from prior year quarter
  • Gross margin percentage of 39.2%, an improvement of 100 basis points from prior year quarter
  • SG&A as a percent of revenue up 150 basis points from prior year quarter due to $2.3 million of one-time expenses
  • Diluted earnings per common share of $0.15 compared to $0.18 in prior year quarter
  • Net income of $4.9 million compared to $5.7 million in prior year quarter
  • Adjusted EBITDA of $11.9 million compared to $13.2 million in prior year quarter
  • Cash dividends declared of $0.14 per share

Resources Connection, Inc. (NASDAQ:RECN), a multinational business consulting firm, operating as Resources Global Professionals (the "Company" or "RGP"), today announced its financial results for the first quarter ended August 24, 2019.

Management Commentary

"We engaged in decisive actions this quarter to improve our financial performance over the mid and longer term – including an important acquisition, a divestiture and an office closure," said Kate W. Duchene, chief executive officer. "We are very pleased to have completed these strategic moves in Q1 of FY20 and continue to progress with our transformation efforts. At the same time, we are disappointed by our revenue results this quarter, and although the decline was modest, we have specific plans to build momentum in the second quarter and are encouraged by the strengthening pipeline."

RESOURCES CONNECTION, INC.

SUMMARY OF CONSOLIDATED FINANCIAL RESULTS

(Amounts in thousands, except percentages and per share amounts)

 

 

 

 

 

 

 

Three Months Ended

 

August 24,

 

May 25,

 

August 25,

 

2019

 

2019

 

2018

As reported (GAAP)

(Unaudited)

 

(Unaudited)

 

(Unaudited)

Revenue

 

 

 

 

 

North America

$

140,376

 

$

146,988

 

$

146,171

Asia Pacific

 

13,086

 

 

13,559

 

 

11,703

Europe

 

18,763

 

 

21,597

 

 

20,684

Total revenue

$

172,225

 

$

182,144

 

$

178,558

 

 

 

 

 

 

Gross margin

$

67,503

 

$

72,956

 

$

68,151

Selling, general and administrative expenses

$

56,978

 

$

56,890

 

$

56,366

Income before provision for income taxes

$

7,580

 

$

13,411

 

$

9,235

Net income

$

4,939

 

$

9,369

 

$

5,741

 

 

 

 

 

 

Effective tax rate

 

35%

 

 

30%

 

 

38%

 

 

 

 

 

 

Diluted EPS

$

0.15

 

$

0.29

 

$

0.18

Cash dividends:

 

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