UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-05707 GEE GROUP INC. (Exact name of registrant as specified in its charter) Illinois 36-6097429 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Iden ...

GEE Group Inc. (NYSE:JOB) Q4 2023 Earnings Conference Call December 19, 2023 11:00 AM ET Company Participants Derek Dewan - Chairman and CEO Kim Thorpe - SVP and CFO Derek Dewan Hello, and welcome to the GEE Group Fiscal Fourth Quarter and Year End September 30, 2023 Earnings and our update for 2024 Webcast Conference Call. I'm Derek Dewan, the Chairman and Chief Executive Officer of GEE Group, and will be hosting today's call. Joining me as a co-presenter is Kim Thorpe, our Senior Vice President and Chief ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K ☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended September 30, 2023 ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File Number 1-05707 GEE GROUP INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Illinois 36-6097429 (I.R.S. Employer Identifi ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-05707 GEE GROUP INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Illinois 36-6097429 (I.R.S. Employer Identifi ...

GEE Group Inc. (NYSE:JOB) Q2 2023 Earnings Conference Call May 17, 2023 11:00 AM ET Company Participants Derek Dewan - Chairman and CEO Kim Thorpe - SVP and CFO Conference Call Participants Derek Dewan Hello, and welcome to the GEE Group Fiscal 2023 Second Quarter ended March 31, 2023 Earnings and Update Webcast Conference Call. I'm Derek Dewan, Chairman and Chief Executive Officer of GEE Group. And will be hosting today's call, joining me as a Co-Presenter is Kim Thorpe, our Senior Vice President and Chief ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements for GEE Group Inc. as of March 31, 2023, and for the three and six-month periods then ended, including balance sheets, statements of operations, cash flows, and notes, highlighting a decrease in net income primarily due to a prior-year one-time gain on debt extinguishment [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) | Balance Sheet Highlights (in thousands) | March 31, 2023 | September 30, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash | $20,099 | $18,848 | | Accounts receivable, net | $20,431 | $22,770 | | Goodwill | $61,293 | $61,293 | | **Total Assets** | **$118,109** | **$119,554** | | **Liabilities & Equity** | | | | Total current liabilities | $11,359 | $15,579 | | **Total Liabilities** | **$15,294** | **$18,551** | | **Total Shareholders' Equity** | **$102,815** | **$101,003** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) | Statement of Operations (in thousands) | Three Months Ended Mar 31, 2023 | Three Months Ended Mar 31, 2022 | Six Months Ended Mar 31, 2023 | Six Months Ended Mar 31, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Revenues | $38,859 | $39,629 | $80,007 | $82,476 | | Gross Profit | $13,216 | $14,514 | $27,607 | $30,096 | | Income from Operations | $694 | $1,177 | $1,456 | $1,150 | | Gain on extinguishment of debt | - | - | - | $16,773 | | **Net Income** | **$658** | **$1,087** | **$1,312** | **$17,755** | | **Diluted EPS** | **$0.01** | **$0.01** | **$0.01** | **$0.15** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Summary (in thousands) | Six Months Ended Mar 31, 2023 | Six Months Ended Mar 31, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,439 | $4,456 | | Net cash used in investing activities | ($84) | ($155) | | Net cash used in financing activities | ($104) | ($73) | | **Net change in cash** | **$1,251** | **$4,228** | | Cash at end of period | $20,099 | $14,175 | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) - The company performed an interim goodwill impairment assessment as of March 31, 2023, determining no impairment was present, contrasting with a **$2.15 million goodwill impairment charge** recorded in the six months ended March 31, 2022[31](index=31&type=chunk) - As of March 31, 2023, the company had **no outstanding borrowings** on its **$20 million revolving credit facility** and had **$13.3 million available for borrowing**[34](index=34&type=chunk)[35](index=35&type=chunk) - In the six months ended March 31, 2022, the company recognized a **gain of $16.77 million** from the forgiveness of its remaining PPP loans[37](index=37&type=chunk) Segment Performance (in thousands) | Segment Performance (in thousands) | Six Months Ended Mar 31, 2023 | Six Months Ended Mar 31, 2022 | | :--- | :--- | :--- | | **Professional Staffing Services** | | | | Total Revenue | $73,163 | $74,652 | | Income from operations | $4,518 | $4,851 | | **Industrial Staffing Services** | | | | Total Revenue | $6,844 | $7,824 | | Income from operations | $37 | $692 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a slight decline in consolidated revenues for both the three and six-month periods ended March 31, 2023, primarily driven by a cyclical downturn in direct hire placement services and reduced demand in industrial staffing, with gross margins compressing due to wage inflation, and net income decreasing significantly due to a prior-year one-time gain from PPP loan forgiveness, while maintaining a strong liquidity position and initiating a share repurchase program [Results of Operations - Three Months Ended March 31, 2023](index=16&type=section&id=Results%20of%20Operations%20-%20Three%20Months%20Ended%20March%2031%2C%202023) | Revenue Breakdown (in thousands) | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Professional contract services | $30,751 | $30,009 | $742 | 2% | | Industrial contract services | $3,225 | $3,736 | ($511) | -14% | | Direct hire placement services | $4,883 | $5,884 | ($1,001) | -17% | | **Consolidated net revenues** | **$38,859** | **$39,629** | **($770)** | **-2%** | - Direct hire placement revenue decreased by **17% YoY**, which management attributes to the highly cyclical nature of this service following a record high in fiscal 2022[65](index=65&type=chunk) - The combined gross profit margin decreased to **34.0%** from **36.6%** in the prior-year quarter, with professional contract services margin compressing to **25.4%** from **26.9%** due to inflation, while industrial services margin improved to **16.5%** from **14.7%** due to price increases[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk) - SG&A expenses decreased by **$523,000** compared to the prior year, which included a one-time legal settlement of **$975,000**, and the company implemented cost reductions in Q1 2023 with estimated annual savings of approximately **$4.0 million**[71](index=71&type=chunk) [Results of Operations - Six Months Ended March 31, 2023](index=19&type=section&id=Results%20of%20Operations%20-%20Six%20Months%20Ended%20March%2031%2C%202023) | Revenue Breakdown (in thousands) | YTD 2023 | YTD 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Professional contract services | $62,533 | $62,605 | ($72) | 0% | | Industrial contract services | $6,844 | $7,824 | ($980) | -13% | | Direct hire placement services | $10,630 | $12,047 | ($1,417) | -12% | | **Consolidated net revenues** | **$80,007** | **$82,476** | **($2,469)** | **-3%** | - Excluding **$3.16 million** in revenue from non-recurring COVID-19 response projects in the prior year, professional contract services revenue would have increased by **5%** for the six-month period[82](index=82&type=chunk) - Net income was **$1.3 million** compared to **$17.8 million** in the prior-year period, with the significant decrease primarily due to a **$16.8 million gain** from the extinguishment of PPP loans and a **$2.15 million goodwill impairment charge** recorded in the six months ended March 31, 2022[98](index=98&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) | Liquidity Position (in thousands) | March 31, 2023 | September 30, 2022 | | :--- | :--- | :--- | | Cash | $20,099 | $18,848 | | Working Capital | $29,928 | $26,643 | - The company had **no outstanding borrowings** on its CIT credit facility and approximately **$13.3 million in availability** as of March 31, 2023[104](index=104&type=chunk) - On April 27, 2023, the Board of Directors approved a share repurchase program authorizing the purchase of up to **$20 million** of the company's common stock through December 31, 2023[105](index=105&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that this item is not applicable, indicating no material market risk disclosures are required for the period - Not applicable[108](index=108&type=chunk) [Controls and Procedures](index=24&type=section&id=Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2023, with no material changes to internal control over financial reporting during the period - Based on an evaluation as of March 31, 2023, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[109](index=109&type=chunk) - No changes in internal control over financial reporting occurred during the six-month period that have materially affected, or are reasonably likely to materially affect, these controls[110](index=110&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=25&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no new significant legal proceedings - None[111](index=111&type=chunk) [Risk Factors](index=25&type=section&id=Item%201A.%20Risk%20Factors) The company refers to the risk factors in its 2022 Form 10-K and adds a new risk concerning financial challenges and depositor confidence in the banking industry, disclosing its mitigation strategy of diversifying cash deposits across multiple FDIC-insured institutions through a specialized brokerage program to stay within insurance limits - A new risk factor was added regarding potential instability in the banking industry following recent bank failures[113](index=113&type=chunk) - To mitigate this risk, the company has taken measures to diversify its deposits, including depositing **$13 million** of its excess cash into a specialized brokerage program that allocates funds among multiple FDIC-insured banks to keep balances below the **$250,000 insurance limit** at each institution since March 31, 2023[113](index=113&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=25&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company indicates that this item is not required - Not required[114](index=114&type=chunk) [Defaults Upon Senior Securities](index=25&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - None[115](index=115&type=chunk) [Other Information](index=25&type=section&id=Item%205.%20Other%20Information) The company reports no other information - None[118](index=118&type=chunk) [Exhibits](index=26&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including amended by-laws, new employment agreements for executives, a form of indemnity agreement, and required officer certifications - The report includes several filed exhibits, such as new employment agreements for Derek Dewan (CEO), Kim Thorpe (CFO), and Alex Stuckey, all dated April 27, 2023[118](index=118&type=chunk)[120](index=120&type=chunk)

GEE Group Inc. (NYSE:JOB) Q1 2023 Earnings Conference Call February 15, 2023 11:00 AM ET Company Participants Derek Dewan - Chairman and Chief Executive Officer Kim Thorpe - Senior Vice President and Chief Financial Officer Derek Dewan Hello, and welcome to the GEE Group Fiscal 2023 First Quarter ended December 31, 2022 Earnings and Update Webcast Conference Call. I'm Derek Dewan, the Chairman and CEO of GEE Group. I will be hosting today's call and joining me as a co-presenter is Kim Thorpe, our Senior Vic ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Exact name of registrant as specified in its charter) ☒ QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-05707 GEE GROUP INC. (State or other jurisdiction of incorporation or organization) Illinois 36-6097429 (I.R.S. Employer Iden ...

Financial Data and Key Metrics Changes - For fiscal year 2022, the company reported revenue of $165.1 million, an increase of 11% compared to $148.9 million in fiscal 2021 [8][5] - The fourth quarter revenue was $41.5 million, showing a slight increase compared to the same quarter in fiscal 2021 [8] - Gross profits for the fiscal year were $61.7 million, with a gross margin of 37.4%, while the fourth quarter gross profit was $15.1 million with a margin of 36.3% [17][5] - Non-GAAP adjusted EBITDA for fiscal 2022 was $12.5 million, up 2% from fiscal 2021, with a margin of 7.5% [6][22] - The company achieved a net income of $19.6 million for fiscal 2022, compared to a near breakeven result in fiscal 2021 [20] Business Line Data and Key Metrics Changes - Contract staffing services contributed $138.5 million (84% of total revenue) for the fiscal year, while direct hire placement revenues were $26.6 million (16%) [9] - Contract staffing services revenues increased by $8.7 million (7%) year-over-year, while direct hire placement revenues rose by $7.5 million (39%) [10][11] - Professional staffing services, including both contract staffing and direct hire placement, accounted for 90% of total revenue, with revenues up 13% for the fiscal year [13][14] - Industrial staffing services revenues decreased by 8% for the fiscal year, attributed to pandemic-related conditions [15][16] Market Data and Key Metrics Changes - The demand for professional staffing services increased as the negative effects of COVID-19 lessened, leading to higher revenues in direct hire placement services [12] - The company noted a shift in hiring patterns, with full-time hires decreasing and contract hiring expected to increase during economic downturns [46][49] Company Strategy and Development Direction - The company aims to maintain a strong liquidity position with no outstanding debt and a focus on judicious cash management [27][30] - Discussions regarding stock buybacks are ongoing, with plans to address this after the earnings release [41][44] - The company is optimistic about future growth despite potential macroeconomic challenges, indicating a strategy to adapt SG&A expenses based on revenue fluctuations [50][65] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate economic uncertainties, citing past experiences during recessions [55][56] - The outlook for fiscal 2023 is cautious, with expectations that full-time hiring may not reach the levels seen in fiscal 2022 [58][62] - The company is actively recruiting talent, particularly from layoffs in the tech sector, to strengthen its workforce [60] Other Important Information - The company reported a working capital ratio of 2.7 to 1 and days' sales outstanding (DSO) of approximately 49 days [24] - Positive net cash flow from operating activities was reported at $1.4 million for the fourth quarter and $9.2 million for the fiscal year [25][26] Q&A Session Summary Question: Why was EBITDA lower and what caused SG&A to increase? - SG&A increased due to accrued additional incentive compensation and bonuses for outstanding performance [35][36] Question: Is there stock manipulation observed with large trades? - The company is unaware of any manipulation and does not have a large short position [40] Question: What will be done with the large cash position? - Discussions on stock buybacks are ongoing, and the company is not in need of cash for working capital [41][44] Question: How will recession affect the company? - The company expects to manage cash flow effectively during downturns, as staffing companies typically collect cash faster than they spend on payroll [55][56] Question: Will the company activate a buyback? - The company is considering stock buybacks and will address this after the earnings are digested [52][53] Question: What is the outlook for direct hire? - Direct hire business is expected to be at levels similar to fiscal 2018 or 2019, with a decline from the high levels of fiscal 2022 [62]

Part I [Business](index=3&type=section&id=Item%201.%20Business) GEE Group Inc, a US-based firm, provides professional and industrial human resources solutions through its two primary staffing divisions - The company provides human resources solutions, including temporary and permanent personnel, across the United States through a network of 28 branch offices and 4 virtual locations[11](index=11&type=chunk) - Services are delivered through two primary operating segments: Professional Staffing Services and Industrial Staffing Services[14](index=14&type=chunk) Revenue Breakdown by Service (Fiscal Years 2022 vs. 2021) | Service Line | Fiscal 2022 Revenue % | Fiscal 2021 Revenue % | | :--- | :--- | :--- | | Professional direct hire placement | 16.1% | 12.8% | | Professional contract services | 74.2% | 75.5% | | Industrial contract services | 9.7% | 11.7% | - The company's growth strategy is twofold: organic growth by expanding services and market penetration, and strategic acquisitions of complementary businesses[17](index=17&type=chunk)[20](index=20&type=chunk) - The staffing industry is highly fragmented with low barriers to entry, featuring competitors ranging from sole proprietorships to large national firms[25](index=25&type=chunk)[27](index=27&type=chunk) - As of September 30, 2022, the company had approximately **309 regular employees** and a variable number of contract service employees, ranging from **1,880 to 2,579** during fiscal 2022[48](index=48&type=chunk) [Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from macroeconomic conditions, financial covenants, operational dependencies, and cybersecurity threats - The U.S. economy is facing **significant inflation and a potential recession**, which could negatively impact the company's business if the economy contracts[51](index=51&type=chunk)[52](index=52&type=chunk) - The company's **$20 million asset-based senior secured revolving credit facility** with CIT Bank contains restrictive covenants that may limit operational and financial flexibility[57](index=57&type=chunk)[59](index=59&type=chunk)[60](index=60&type=chunk) - Material intangible assets, including goodwill, are subject to impairment risks, which could lead to **future material impairment charges**[62](index=62&type=chunk)[63](index=63&type=chunk) - The business requires **significant working capital** to fund the payroll of temporary workers before receiving client payments, making it vulnerable to cash shortfalls[64](index=64&type=chunk) - Success is highly dependent on retaining senior management and attracting qualified personnel in a competitive market[74](index=74&type=chunk)[76](index=76&type=chunk) - On February 1, 2022, the company detected and stopped a network security incident where an unauthorized third party gained access and encrypted systems[89](index=89&type=chunk)[91](index=91&type=chunk) - The company's ability to use its net operating loss (NOL) carryforwards may be limited by Section 382 of the Internal Revenue Code if an "ownership change" occurs[102](index=102&type=chunk)[103](index=103&type=chunk) [Unresolved Staff Comments](index=27&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) There are no unresolved staff comments to report for the period - Not applicable[135](index=135&type=chunk) [Properties](index=27&type=section&id=Item%202.%20Properties) The company leases all its office spaces, operating from 28 branch offices and 4 remote locations across eleven states - The company's policy is to lease, not purchase, its office spaces, with its headquarters in Jacksonville, Florida, under a lease expiring in 2026[136](index=136&type=chunk) - As of September 30, 2022, the company operated from **28 branch offices and 4 remote locations** in eleven states[137](index=137&type=chunk) [Legal Proceedings](index=27&type=section&id=Item%203.%20Legal%20Proceedings) The company settled two lawsuits in March 2022 for a one-time payment of $1.175 million - The company settled two lawsuits with Sands Brothers Venture Capital II, LLC on March 23, 2022[140](index=140&type=chunk) - The settlement involved a one-time payment of approximately **$1.175 million**, with the company's portion being **$975,000**, recognized as a pre-tax charge in fiscal 2022[141](index=141&type=chunk) [Mine Safety Disclosures](index=27&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company's operations - Not applicable[143](index=143&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=28&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE American under the symbol "JOB," and no dividends were paid in fiscal 2021 or 2022 - The company's common stock is listed on the NYSE American under the symbol **"JOB"**[145](index=145&type=chunk) - **No dividends were paid** in fiscal 2022 or 2021, and none are anticipated for the foreseeable future[146](index=146&type=chunk) Securities Authorized for Issuance under Equity Compensation Plans (as of Sep 30, 2022) | Plan Category | Securities to be issued upon exercise (thousands) | Weighted average exercise price | Securities remaining available for future issuance (thousands) | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | 3,619 | $1.24 | 9,931 | [[Reserved]](index=28&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2022 revenue grew 11% to $165.1 million, while net income surged to $19.6 million due to PPP loan forgiveness and lower interest expense Consolidated Net Revenues (Fiscal 2022 vs. 2021) | Revenue Source | 2022 ($ thousands) | 2021 ($ thousands) | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Professional contract services | 122,562 | 112,470 | 10,092 | 9% | | Industrial contract services | 15,945 | 17,332 | (1,387) | -8% | | **Total contract services** | **138,507** | **129,802** | **8,705** | **7%** | | Direct hire placement services | 26,605 | 19,078 | 7,527 | 39% | | **Consolidated net revenues** | **165,112** | **148,880** | **16,232** | **11%** | - The combined gross profit margin increased to **37.4%** in fiscal 2022 from 35.3% in fiscal 2021, mainly due to a higher mix of 100% margin direct hire placement revenue[166](index=166&type=chunk) - SG&A expenses increased to **$51.9 million** (31% of revenue) in fiscal 2022 from $41.7 million (28% of revenue) in fiscal 2021, driven by higher incentive compensation and one-time charges[169](index=169&type=chunk) - A non-cash goodwill impairment charge of **$2.15 million** was recognized in the first quarter of fiscal 2022[173](index=173&type=chunk) - Net income for fiscal 2022 was **$19.6 million**, a significant increase from $6,000 in fiscal 2021, primarily driven by a **$16.8 million gain on the forgiveness of PPP loans** and a **$5.5 million decrease in interest expense**[178](index=178&type=chunk) Consolidated Cash Flow Data (Fiscal 2022 vs. 2021) | Cash Flow Activity | 2022 ($ thousands) | 2021 ($ thousands) | | :--- | :--- | :--- | | Cash flows provided by operating activities | 9,229 | 370 | | Cash flows used in investing activities | (328) | (126) | | Cash flows used in financing activities | - | (4,371) | - Working capital increased substantially to **$26.6 million** as of September 30, 2022, from $2.5 million a year prior, mainly due to strong cash flow and PPP loan forgiveness[180](index=180&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable to the company - Not applicable[223](index=223&type=chunk) [Financial Statements and Supplementary Data](index=40&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section provides an index to the company's consolidated financial statements and independent auditor reports - This item serves as an index to the detailed Consolidated Financial Statements and Supplementary Data, which are located in the latter part of the report, starting on page F-1[224](index=224&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=53&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) There were no changes in or disagreements with the company's accountants - None[357](index=357&type=chunk) [Controls and Procedures](index=54&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of September 30, 2022 - Management, including the CEO and PFO, concluded that the company's disclosure controls and procedures and internal control over financial reporting were **effective** as of September 30, 2022[357](index=357&type=chunk)[360](index=360&type=chunk)[361](index=361&type=chunk) - Following a network security incident on February 1, 2022, an investigation was conducted and **no material weaknesses** in internal controls were identified as a result[362](index=362&type=chunk)[364](index=364&type=chunk) [Other Information](index=55&type=section&id=Item%209B.%20Other%20Information) There is no other information to report under this item - None[365](index=365&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=55&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The company is led by a combined Chairman/CEO, an independent board, and five standing committees, all governed by a Code of Ethics - The executive officers include Derek E. Dewan (CEO), Alex Stuckey (COO), and Kim Thorpe (CFO)[368](index=368&type=chunk) - The Board of Directors has determined that all directors, except for CEO Derek E. Dewan, are **independent** under NYSE American listing standards[393](index=393&type=chunk) - The company combines the roles of Chairman of the Board and CEO, held by Mr. Dewan, believing it enables decisive leadership and clear accountability[389](index=389&type=chunk) - The Board has five standing committees: Nominating, Audit, Corporate Governance, Mergers and Acquisitions, and Compensation[395](index=395&type=chunk) - The company has adopted a Code of Ethics for all directors and employees to promote honest conduct and compliance with laws[420](index=420&type=chunk) [Executive Compensation](index=62&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation in fiscal 2022 featured base salaries, performance bonuses, and equity awards under a new incentive program Summary Compensation Table (Fiscal 2022) | Name and Principal Position | Salary ($) | Bonus ($) | All Other Compensation ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | | **Derek Dewan**, CEO | 350,000 | 498,750 | 2,800 | 851,550 | | **Alex Stuckey**, COO | 250,000 | 267,188 | 2,800 | 519,988 | | **Kim Thorpe**, SVP & CFO | 270,000 | 288,563 | 2,800 | 561,363 | - The company has employment agreements with its named executive officers, which include provisions for salary, bonus eligibility, and standard termination clauses[423](index=423&type=chunk)[424](index=424&type=chunk)[425](index=425&type=chunk) - In fiscal 2022, the company adopted a formal **Annual Incentive Compensation Program (AICP)** which includes performance-based short-term cash incentives and long-term equity incentives[427](index=427&type=chunk)[428](index=428&type=chunk) - Non-employee directors were compensated with quarterly cash fees for board and committee service, with increased compensation and stock option grants beginning in fiscal 2023[434](index=434&type=chunk)[435](index=435&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=64&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) As of December 2022, directors and executives owned 5.26% of common stock, while Raffle Associates, L.P. held 7.79% Security Ownership as of December 19, 2022 | Name of Beneficial Owner | Amount of Beneficial Ownership | Percent of Class | | :--- | :--- | :--- | | Derek Dewan (CEO) | 2,091,017 | 1.83% | | Alex Stuckey (COO) | 1,666,624 | 1.46% | | Current directors and executive officers as a group (9 individuals) | 6,018,525 | 5.26% | | Raffle Associates, L.P. (5% Holder) | 8,913,857 | 7.79% | [Certain Relationships and Related Transactions, and Director Independence](index=66&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Six of the seven board members are independent, and no material related party transactions were reported beyond executive compensation and director stock purchases - The Board has determined that six directors (William Isaac, Darla Moore, Carl Camden, Matthew Gormly, Thomas Vetrano, and Peter Tanous) are **independent**[442](index=442&type=chunk) - In April 2021, six directors and officers collectively acquired **678,765 shares** of common stock by participating in the company's follow-on public offering or through open market purchases[445](index=445&type=chunk) [Principal Accountant Fees and Services](index=66&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) FORVIS, LLP served as the independent auditor for fiscal 2022, with total fees of approximately $276,000 for audit and related services - FORVIS, LLP was engaged as the independent registered public accounting firm for fiscal year 2022, succeeding Friedman, LLP[446](index=446&type=chunk) Accountant Fees (Fiscal 2022 vs. 2021) | Fee Type | Fiscal 2022 ($) | Fiscal 2021 ($) | | :--- | :--- | :--- | | Audit fees | 244,000* | 212,000 | | Audit-related fees | 32,000 | 77,500 | *Fiscal 2022 includes $192,000 billed by FORVIS and $52,000 by Friedman for prior period services. - The Audit Committee's policy is to pre-approve all audit and non-audit services provided by the independent accounting firm[450](index=450&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=67&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all exhibits filed with the Form 10-K, including corporate documents, material contracts, and required certifications - This item provides a list of all exhibits filed with the annual report, including articles of incorporation, bylaws, material contracts, and required certifications[452](index=452&type=chunk)