BGSF(US:BGSF)2021-05-06 12:58Revenue Performance - Total revenues for the thirteen weeks ended March 28, 2021, were $67.712 million, a decrease of approximately $6.355 million (8.6%) compared to $74.067 million for the same period in 2020[130]. - Real Estate segment revenues decreased by approximately $1.4 million (7.1%) due to a 14.3% decrease in billed hours, partially offset by an 8.9% increase in average bill rate[134]. - Professional segment revenues decreased by approximately $5.2 million (14.3%), primarily due to a 19.7% decrease in billed hours, despite a contribution of $3.7 million from the EdgeRock acquisition[135]. - Light Industrial segment revenues increased by approximately $0.3 million (1.5%) due to increased demand in the logistics market, with an 8.5% increase in average bill rate[136]. - Total revenue for the period was $16,723,000, representing a 3.2% increase from $16,202,000 in the previous year[145]. Profitability - Gross profit for the thirteen weeks ended March 28, 2021, was $18.815 million, a decrease of approximately $1.460 million (7.2%) compared to $20.275 million in the same period in 2020[139]. - The gross profit margin increased to 27.8% from 27.4%, primarily due to higher gross profits in the Professional segment[139]. - Adjusted EBITDA for the period was $2,886,000, a decrease of 45.2% compared to $5,266,000 in the prior year[151]. - Net income for the period was $712,000, down from $1,499,000, reflecting a 52.5% decrease[151]. Expenses and Financial Management - Selling, general and administrative expenses increased by approximately $0.5 million (3.2%), primarily due to the EdgeRock and Momentum acquisitions[143]. - Interest expense decreased by approximately $0.1 million (17.4%) due to lower average balance on the Revolving Facility and lower rates[146]. - Income tax expense decreased by approximately $0.6 million (79.7%) primarily due to lower pre-tax income and non-deductible transaction fees[146]. - Cash provided by operating activities was $1,911,000, a decrease of $4.7 million compared to $6,640,000 in the previous year[159]. - Cash used in investing activities was $4,328,000, primarily for the Momentum acquisition and capital expenditures[157]. Capital Structure and Financing - The company borrowed $3.8 million on the Revolving Facility to fund the Momentum acquisition[163]. - Working capital as of March 28, 2021, was $19,189,000, down from $25,380,000 in the previous year[157]. - The company plans to open new branches throughout the next year, which may require additional debt or equity financing[156]. - The company entered into a standby letter of credit arrangement in March 2020, with a maximum financial exposure of $0.1 million as of March 28, 2021[168]. Operational Context - The company continues to monitor the impact of COVID-19 on its operations and may take further actions as required by authorities[129]. - The company operates across 42 states and D.C., with a focus on three segments: Real Estate, Professional, and Light Industrial[120]. - The company has completed multiple acquisitions to expand its workforce solutions capabilities, including EdgeRock in February 2020 and Momentum in February 2021[120]. Accounting and Risk Management - The consolidated financial statements are prepared in accordance with GAAP, with significant accounting policies reviewed regularly to ensure fair presentation[169]. - The company is exposed to interest rate risk due to a portion of its Revolving Facility and Term Loan being priced at variable interest rates[170].