Business
HireQuest Reports 18.7% Revenue Increase for the First Quarter of 2020
Company Generates $5.5 Million in Cash from Operations GOOSE CREEK, S.C.--(BUSINESS WIRE)-- HireQuest, Inc. (Nasdaq: HQI), a national provider of back-office
About this update from Hirequest, Inc.
[{"type":"text","content":"\nCompany Generates $5.5 Million in Cash from Operations\n\n GOOSE CREEK, S.C.--(BUSINESS WIRE)--\nHireQuest, Inc. (Nasdaq: HQI), a national provider of back-office and operational support for franchised operators of on-demand and temporary staffing service providers, today reported financial results for the first quarter ended March 31, 2020.\n\n\nFirst Quarter 2020 Financial Summary \n\n\n\nFranchise royalties increased 17.4% to $3.7 million compared to $3.2 million in the prior year period. Of this increase, approximately $783,000 related to branches acquired in the merger and subsequently converted to our franchise model.\n\n\nServices revenue, which includes interest paid on aging accounts receivable, increased 31.2% to $415,000 compared to $316,000 in the prior year period.\n\n\nTotal revenue increased 18.7% to $4.1 million compared to $3.5 million in the prior year period.\n\n\nReserve of $1.4 million placed on notes receivable issued to finance the sale of offices acquired in the merger with Command Center as a result of the negative impact COVID-19 has had on the economy.\n\n\nIncome from continuing operations, inclusive of the non-recurring, pre-tax reserve of $1.4 million placed on notes receivable, was $875,000, or $0.06 per diluted share, compared to $1.7 million, or $0.17 per diluted share, in the year-ago period.\n\n\n\nSystem-wide sales1 (a non-GAAP operating performance metric) for the first quarter 2020 increased 18.7% to $56.5 million compared to $47.6 million for the quarter ended March 31, 2019.\n\n\n“The operating profit margin, excluding the impact of the $1.4 million one-time reserve on notes receivable, remained steady on higher revenue for the first quarter, despite increasing challenges faced by our franchisees because of extraordinary pressures in the current labor market,” commented Rick Hermanns, HireQuest’s President and Chief Executive Officer. “We remain optimistic about the long-term prospects for our business as we believe our franchise model, which significantly reduces risks by minimizing capital investments and generating ongoing levels of cash, will further strengthen our balance sheet and allow us to weather the volatility created by current economic conditions.”\n\n\n“Market and economic challenges exacerbated by the current COVID-19 pandemic, drove our decision to record a $1.4 million r...