The Hackett Group Announces Second Quarter 2019 Results
- Q2 2019 net revenue of $68.0 million at the mid-point of guidance and pro forma EPS of $0.28, at high-end of guidance
- Q2 2019 GAAP EPS of $0.22 as compared to GAAP EPS of $0.36 in the same period of the prior year, which included a favorable $0.14 per share acquisition liability adjustment
- Board of Directors declared $0.18 semi-annual dividend, an increase of 6% from prior year, paid in July 2019
MIAMI, FL – August 6, 2019 – The Hackett Group, Inc. (NASDAQ: HCKT), a global intellectual property-based strategic consultancy and leading enterprise benchmarking and best practices digital transformation firm, today announced its financial results for the second quarter, which ended on June 28, 2019.
Q2 2019 net revenue (gross revenue less reimbursable expenses) from continuing operations was $68.0 million, down 1%, as compared to the same period in the prior year. Q2 2019 gross revenue from continuing operations was $73.5 million, down 1% from the same period in the prior year.
Q2 2019 pro forma diluted earnings per share were $0.28 per share, as compared to $0.27 per share for the same period in the prior year. Pro forma information is provided to enhance the understanding of the Company’s financial performance and is reconciled to the Company’s GAAP information in the accompanying tables.
Q2 2019 GAAP diluted earnings per share were $0.22 per share, as compared to $0.36 per share for the same period in the prior year. During the second quarter of 2018, the Company recorded a $4.6 million, or $0.14 per diluted share, benefit due to the remeasurement of an acquisition earnout liability.
At the end of the second quarter of 2019, the Company’s cash balances were $16.7 million. During the quarter, the Company utilized cash to pay down outstanding debt of $3.0 million. In addition, during the second quarter of 2019, the Company repurchased 93 thousand shares of the Company’s common stock at an average price per share of $15.60 for a total of $1.5 million. At the end of the second quarter of 2019, the Company’s remaining stock repurchase program authorization was $3.9 million.
“As expected, we experienced strong sequential growth in nearly all of our US groups as we saw increased momentum across client cloud and digital transformation initiatives,” stated Ted A. Fernandez, Chairman and CEO of The Hackett Group. “We expect our US momentum to continue into the third quarter, which bodes well for our prospects for the remainder of the year.”
Based on the current economic outlook, the Company estimates total net revenue for the third quarter of 2019 to be in the range of $66.5 million and $68.5 million or gross revenue (inclusive of reimbursable expenses) to be in the range of $72.0 million and $74.0 million. The Company estimates pro forma diluted earnings per share for the third quarter of 2019 to be in the range of $0.27 and $0.29.
Digital Awards – The Hackett Group announced that Bayer and IBM were the winners of its 2019 Digital Awards, which spotlight companies that are on the cutting edge of digital transformation, including smart automation, robotic process automation (RPA), cognitive computing and advanced analytics. Bayer won the award in the advanced analytics category for its Statistical Demand Forecasting System, while IBM won in the smart automation category for its Cognitive Support Platform. Four other companies were also recognized as finalists: HCL/Manchester United Football Club, HP, IBM and Indecomm. The Hackett Group’s Digital Awards spotlight and celebrate companies on the cutting edge of using smart automation and advanced analytics to solve business problems.
HR Key Issues Research – The Hackett Group issued its 2019 HR Key Issues research, which found that HR organizations are making progress on improving key capabilities. The research found that improvements have been slow and gaps remain and HR organizations find themselves challenged to address an array of areas that are critical to helping the enterprise achieve its objectives. The research found that most HR organizations remain behind the curve in addressing areas that are central to achieving enterprise goals: developing executives who can lead in volatile environments, supporting enterprise digital transformation, and dealing with critical talent/skill shortages.
IT Key Issues Research – The Hackett Group issued its 2019 IT Key Issues research, which found that while IT organizations are making progress with their own internal digital transformation, they are still struggling to support the broader enterprise, reallocate the technology portfolio, implement a more agile technology infrastructure, drive innovation, and improve customer-centricity. The research found that IT has limited capability to address many of their highest priority objectives. In addition, plans to address these deficiencies fall woefully short, calling into question IT’s ability to live up to the business expectation to serve as a true strategic business partner.
On Tuesday, August 6, 2019 senior management will discuss second quarter results in a conference call at 5:00 P.M. ET. (800) 593-0486, [Passcode: Second Quarter]. For International callers, please dial (517) 308-9371.
Please dial in at least 5-10 minutes prior to start time. If you are unable to participate on the conference call, a rebroadcast will be available beginning at 8:00 P.M. ET on Tuesday, August 6, 2019 and will run through 5:00 P.M. ET on Tuesday, August 20, 2019. To access the rebroadcast, please dial (888) 397-5659. For International callers, please dial (203) 369-3145.
In addition, The Hackett Group will also be webcasting this conference call live through the StreetEvents.com service. To participate, simply visit https://www.thehackettgroup.com approximately 10 minutes prior to the start of the call and click on the conference call link provided. An online replay of the call will be available after 8:00 P.M. ET on Tuesday, August 6, 2019 and will run through 5:00 P.M. ET on Tuesday, August 20, 2019. To access the replay, visit www.thehackettgroup.com or www.streetevents.com.
Earnings Call Documents
- Consolidated Statements of Operations – Q2 2019
- Supplemental Data discussed during earnings call – Q2 2019
SEC XBRL Filings
- XBRL Calculation – Q2 2019
- XBRL Definition – Q2 2019
- XBRL Label – Q2 2019
- XBRL Presentation – Q2 2019
- XBRL Instance – Q2 2019
- XBRL Schema – Q2 2019
About The Hackett Group, Inc.
The Hackett Group (NASDAQ: HCKT) is an intellectual property-based strategic consultancy and leading enterprise benchmarking and best practices digital transformation firm to global companies, offering digital transformation including robotic process automation and enterprise cloud application implementation. Services include business transformation, enterprise analytics and global business services. The Hackett Group also provides dedicated expertise in business strategy, operations, finance, human capital management, strategic sourcing, procurement and information technology, including its award-winning Oracle and SAP practices.
The Hackett Group has completed more than 17,850 benchmarking and performance studies with major corporations and government agencies, including 93% of the Dow Jones Industrials, 90% of the Fortune 100, 80% of the DAX 30 and 57% of the FTSE 100. These studies drive Hackett’s Digital Transformation Platform which includes the firm’s benchmarking metrics, best practices repository and best practice configuration guides and process flows, which enable The Hackett Group’s clients and partners to achieve world-class performance.
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks, uncertainties and other factors that may cause The Hackett Group’s actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. Factors that impact such forward-looking statements include, among others, the ability of our products, services, or offerings mentioned in this release to deliver the desired effect, our ability to effectively integrate acquisitions into our operations, our ability to retain existing business, our ability to attract additional business, our ability to effectively market and sell our product offerings and other services, including those referenced above, the timing of projects and the potential for contract cancellations by our customers, changes in expectations regarding the business consulting and information technology industries, our ability to attract and retain skilled employees, possible changes in collections of accounts receivable due to the bankruptcy or financial difficulties of our customers, risks of competition, price and margin trends, foreign currency fluctuations, the impact of Brexit on our business, changes in general economic conditions and interest rates, our ability to obtain debt financing through additional borrowings under an amendment to our existing credit facility as well as other risks detailed in our Company’s Annual Report on Form 10-K for the most recent fiscal year filed with the Securities and Exchange Commission. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Robert A. Ramirez, CFO, 305-375-8005 or email@example.com