The Hackett Group Announces Second Quarter 2022 Results
MIAMI, FL (August 9, 2022) – 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 July 1, 2022.
- Total revenue in the second quarter of 2022 increased 4% to $75.9 million and revenue before reimbursements increased 2% to $74.8 million, as compared to the second quarter of 2021, which exceeded the high end of guidance.
- Total revenue in the second quarter of 2022 excluding the non-recurring $5.3 million SAP software sale in the second quarter of 2021 increased 12%.
- GAAP diluted earnings per share was $0.32 in both the second quarter of 2022 and 2021.
- Adjusted diluted earnings per share, a non-GAAP measure, was $0.38 in the second quarter of 2022 as compared to $0.39 in the second quarter of 2021, or $0.30 excluding the software sale transaction, an increase of 27% and which exceeded the high end of guidance. Adjusted financial 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.
- As of the end of the second quarter of 2022, the Company’s remaining share repurchase program authorization was $10.6 million. As of July 1, 2022, the Company’s cash balances were $61.7 million, with no outstanding debt.
- Subsequent to the end of the second quarter, the Company’s Board of Directors declared a quarterly dividend of $0.11 per share for its shareholders of record on September 23, 2022, to be paid on October 7, 2022.
“We reported better than expected results driven by the growth and margin expansion of our Strategy and Business Transformation group,” stated Ted A. Fernandez, Chairman & CEO of The Hackett Group, Inc. “Additionally, we also signed a significant multi-year IP as-a-Service contract which demonstrates that our investments in our Quantum Leap and Digital Transformation platforms are strategic and valuable to our clients and partners.”
Business Outlook for the Third Quarter of 2022
Based on the Company’s current economic outlook:
- The Company estimates total revenue before reimbursements for the third quarter of 2022 will be in the range of $70.5 million to $72.5 million.
- The Company estimates adjusted diluted earnings per share for the third quarter of 2022 to be in the range of $0.34 and $0.36, assuming a GAAP effective tax rate of 28% instead of the 25% long term tax rate we have been previously utilizing for guidance.
Conference Call and Webcast Details
- On Tuesday, August 9, 2022, senior management will discuss second quarter results in a conference call at 5:00 P.M. ET. The number for the conference call is (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 9, 2022, and will run through 5:00 P.M. ET on Tuesday, August 23, 2022. To access the rebroadcast, please dial (888) 296-6948. For International callers, please dial (203) 369-3028.
- 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 9, 2022, and will run through 5:00 P.M. ET on Tuesday, August 23, 2022. To access the replay, visit www.thehackettgroup.com.
Use of Non-GAAP Financial Measures
The Company provides adjusted earnings results (which exclude the loss from discontinued operations, non-cash stock compensation expense, acquisition-related compensation expense, acquisition-related non-cash compensation expense, restructuring and asset impairment reversals, amortization of intangible assets and include a GAAP tax rate) as a complement to results provided in accordance with Generally Accepted Accounting Principles (GAAP). These non-GAAP results are provided to enhance the users’ overall understanding of the Company’s current financial performance and its prospects for the future. The Company believes the non-GAAP results provide useful information to both management and investors and by excluding certain expenses that it believes are not indicative of its core operating results. The non-GAAP measures are included to provide investors and management with an alternative method for assessing operating results in a manner that is focused on the performance of ongoing operations and to provide a more consistent basis for comparison between quarters. Further, these non-GAAP results are one of the primary indicators management uses for planning and forecasting in future periods. In addition, since the Company has historically reported non-GAAP results to the investment community, it believes the continued inclusion of non-GAAP results provides consistency in its financial reporting. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. See the reconciliation of actual results titled “Reconciliation of GAAP to Non-GAAP Measures” in the accompanying tables.
The Company believes that the presentation of non-GAAP financial information on a forward-looking basis, including the guidance contained in this release, provides important supplemental information to management and investors regarding its anticipated financial and business trends relating to the Company’s results of operations. The Company is unable to provide a reconciliation of GAAP measures to corresponding forward-looking non-GAAP measures without unreasonable effort due to the high variability and low visibility of most of the items that have been excluded from these non-GAAP measures. For example, share-based compensation expense is impacted by the Company’s future hiring needs, the type and volume of equity awards necessary for such future hiring, and the price at which the Company’s stock will trade in those future periods. In addition, the provision or benefit for income taxes is impacted by non-recurring income tax adjustments, valuation allowance on deferred tax assets, and the income tax effect of non-GAAP exclusions. The effects of these reconciling items may be significant, as the items that are being excluded are difficult to predict.
Earnings Call Documents
- Consolidated Statements of Operations – Q2 2022
- Supplemental Data discussed during earnings call – Q2 2022
- Reconciliation of GAAP to Non-GAAP Measures – Q2 2022
SEC XBRL Filings – Q2 2022
- XBRL Calculation – Q2 2022
- XBRL Definition – Q2 2022
- XBRL Instance – Q2 2022
- XBRL Label – Q2 2022
- XBRL Presentation – Q2 2022
- XBRL Schema – Q2 2022
About The Hackett Group
The Hackett Group® (NASDAQ: HCKT) is an intellectual property-based strategic consultancy and leading enterprise benchmarking firm to global companies, offering digital transformation including implementation of leading enterprise cloud applications, workflow automation and analytics that enable Digital World Class™ performance.
Drawing from our unparalleled IP from nearly 20,000 benchmark studies with the world’s leading businesses – including 97% of the Dow Jones Industrials, 94% of the Fortune 100, 70% of the DAX 30 and 51% of the FTSE 100 – captured through our leading benchmarking platform, Quantum Leap®, and our Digital Transformation Platform, we accelerate best practices implementations.
More information on The Hackett Group is available at: www.thehackettgroup.com, firstname.lastname@example.org, or by calling (770) 225-3600.
The Hackett Group, quadrant logo, World Class Defined and Enabled and Quantum Leap are the registered marks of The Hackett Group, Inc.
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 impact of the coronavirus pandemic, including the duration and severity of the pandemic, the economic impact of the pandemic and the timing of an economic recovery, demand for our services, our ability to manage our business and capital resources through the pandemic, 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 through strategic initiatives or otherwise, 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, especially given that our clients are also impacted by the pandemic, changes in expectations regarding the business consulting and information technology industries, our ability to attract and retain skilled employees, the impact of any federally-mandated vaccine, testing or other COVID-19 related requirements on employee retention and our results of operations, 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 the geopolitical conflict involving Russian and Ukraine on our business, changes in general economic conditions, inflation and interest rates, our ability to obtain additional debt financing if needed, as well as other risks detailed in our Annual Report on Form 10-K for the most recent fiscal year as 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.
Robert A. Ramirez, CFO, 305-375-8005 or email@example.com