RECN stock closed up 4% in after-hours trading on January 2, 2019, after the company reported an earnings beat.
Resources Connection, Inc. (Nasdaq: RECN), a multinational business consulting firm, operating as Resources Global Professionals, today announced its financial results for the second quarter ended November 23, 2019. Resources Connection reports Q2 EPS of 38c versus the consensus estimate of 30c. The company reports Q2 revenue of $184.5M versus the consensus estimate of $185.5M.
Second Quarter Fiscal 2020 Highlights:
- Revenue $184.5 million, down 2.3% from prior year quarter, up 7.1% sequentially
- Gross margin percentage of 40.3%, an improvement of 140 basis points from prior year quarter
- SG&A as a percent of revenue improves 400 basis points sequentially
- Net income of $12.3 million, up 16.8% from $10.6 million in prior year quarter
- Diluted earnings per common share of $0.38, up 15.2% from $0.33 in prior year quarter
- Adjusted EBITDA increases to $22.7 million compared to $20.0 million in prior year quarter
- Adjusted EBITDA margin improves by 170 basis points to 12.3% compared to prior year quarter
- Cash dividends declared of $0.14 per share
“We experienced an improvement in revenue in North America this quarter and modest strengthening in Europe – both good developments since the previous quarter,” said Kate W. Duchene, chief executive officer. “Despite the slight revenue dip year-over-year, we are actively managing the business to deliver more profit through gross margin improvement and lower SG&A. The pipeline is stronger heading into Q3 than it has been in 12 months and while year-over-year revenue is a tough comparable because of the peak of lease accounting project revenue in Q2 and Q3 last year, we are replacing that revenue stream with other opportunities, particularly in our Strategic Client Program with program and project management.”