Slide 1: Harte Hanks: The Customer Company
Harte Hanks The Customer Company JUNE 2022 NASDAQ: HHS
Slide 2: Disclaimers
Disclaimers Cautionary Note Regarding Forward-Looking Statements The report and the other disclosure we make from time to time contain "forward-looking statements" within the meaning of U.S. federal securities laws. All such statements are qualified by this cautionary note, provided pursuant to the
Slide 3: Harte Hanks: The Customer Company
Harte Hanks: Diluted EPS — FY 2021 Revenue of $195 million The Customer Company $1.27 — FY 2021 EBITDA of $10+ million $0.52 Harte Hanks is a leading global customer experience $0.39 — FY 2021 Net Income YoY increase $16.7 million ($0.28) $0.20 company operating in three business segments — 5 quarte
Slide 4: What we do
What we do HHS is a global customer experience company focused on bringing companies closer to customers for nearly 100 years. We provide our services to diverse industries including, but not limited to health care, pharma, financials, consumer products, technology, entertainment/streaming, and auto
Slide 5: Where we were: Where we are
Where we were: Where we are: 2014-2018 2019-2022 Q1 — FY2018 - $285 million Revenue and negative $19 million of EBITDA — FY 2021 - $195 million Revenue and $10 million of EBITDA — Direct Mailer with marketing capabilities — Shrink to grow - Leaner, optimized, and simplified business — Mis-steps and
Slide 6: Harte Hanks – The Customer Company
Harte Hanks – The Customer Company − Great Companies and Leading Brands − Average Tenured Customer – 10 years − Dedication through good times and bad − Longest Tenured Customer – Over 25 years 6
Slide 7: Leadership team
Leadership team Brian Linscott Lauri Kearnes Bob Wyman Chief Executive Officer Chief Financial Officer General Counsel • 25-year Executive with consulting, C- • 25-year Financial Professional • 32-year Corporate Legal Professional level, and board experience • 18 years with Harte Hanks • 10 years wi
Slide 8: 3-year Customer Journey For Global Spirits Company
3-year Customer Journey For Global Spirits Company Fulfillment Logistics Implementation Digital Print US and Canadian Global Brand eStore Point of purchase on demand Customer Care Customer Care development materials All B2C customer And product distribution For promo items contact $2.4MM $2.7MM $3.1
Slide 9: Turnaround with Revenue Growth
Turnaround with Revenue Growth Revenue Growth • FY 2021 Revenue $195 million vs $177 million in Q4 FY 2020 • Five consecutive quarters of YoY growth Q3 • FDA-approved Kansas City facility with 40% growth capacity Q2 • Work-from-home expanding growth opportunities in Customer Care Q1 • Healthy pipeli
Slide 10: Significant EBITDA and Net Income improvement
Significant EBITDA and Net Income improvement Net Income 2019 2020 2021 • Restructuring began in 2019 and is now complete 15.0** Dollars in Millions • 2020 Reduced facilities, technology infrastructure, and overhead ($15-17 million in annualized savings) -1-.7** • Shut down of underperforming Direct
Slide 11: Harte Hanks Q1 2022 Balance Sheet
Harte Hanks Q1 2022 Balance Sheet Condensed Consolidated Balance Sheet (in millions) 3/31/22 • $12.2 million Cash (including restricted cash) and declining Cash, restricted cash and cash equivalents $12.2 debt balance Accounts receivable, net $49.0 • $49 million of Accounts Receivables from sought a
Slide 12: Pension liabilities
Pension liabilities Non-Qualified Pension • Relates to contracts with previous management • Requires periodic contract payments to participants • $0.4 million contribution made in Q1 2022 and we expect to make $1.7 million in FY2022 • Pensions were frozen in the 1990s and 2000s • Features of liabili
Slide 13: Harte Hanks Stock Profile
Stock Profile Harte Hanks Stock Profile Symbol HHS HHS Price @ 6/3/22 close $9.44 Intraday Price on 6/3/22 Shares (millions outstanding @ Q4 2021) 7.0 Market Cap (millions) $66.3 Cash (net of debt, Q1 2022, in millions) $4.7 EBITDA (Q1 2022, in millions) $4.5 HHS YTD Performance +19.2% Russell Micro
Slide 14: Where we are going
Harte Hanks: Where we are going: The Customer Company — Improve profitability and revenue that serve growing markets — Invest in talent, technology, and offerings to build scale Marketing Services — Investing in partnerships, sales, and marketing — Leverage long-term relationships to drive organic g
Slide 15: Appendix I: Reconciliation of Adjusted EBITDA to Net Income
Appendix I Reconciliation of Adjusted EBITDA to Net Income Reconciliations of Non-GAAP Financial Measures (Unaudited) 15
Slide 16: Appendix II: The Harte Hanks Experience
Appendix II The Harte Hanks Experience Marketing Services Operational Services Data & Analytics Creative Services Marketing Customer Strategy Fulfillment Logistics Technology Care • CRM, Brand, Marketing • Predictive analytics/ • Creative Concepts • Database Build & • Customer Experience • DTC & B2B