Revenue down 5.2% YoY for Hudson Global
Hudson Global, Inc. has announced its financial results for the first quarter ended 31st March 2016.
- On a retained basis, revenue of $101.2m declined 5.2% from the first quarter of 2015 but increased 0.4% in constant currency. On a reported basis, revenue declined 18.6% or 14.4% in constant currency.
- On a retained basis, gross margin of $41.3m declined 5.7% from the first quarter of 2015 and 1.3% in constant currency. On a reported basis, gross margin declined 13.9% or 10.1% in constant currency.
- The company reported an Adjusted EBITDA loss of $2.0m, including $0.5m of legal fees related to an arbitration matter, compared with adjusted EBITDA loss of $3.8m in the first quarter of 2015.
- Net loss of $3.5m, or $0.10 per basic and diluted share, was recorded, compared with net loss of $6.8m, or $0.21 per basic and diluted share, for the first quarter of 2015.
Stephen Nolan, chief executive officer at Hudson, commented, "We are encouraged by the continued gross margin growth in many of our key markets, including Australia, Belgium and the Americas.
"We delivered significantly improved adjusted EBITDA performance against prior year for the third consecutive quarter, amidst variable economic conditions. We expect to deliver positive adjusted EBITDA in 2016."
In the first quarter, Hudson Americas' gross margin increased 18% on a retained basis in constant currency but decreased 27% on a reported basis compared with the first quarter of 2015. The gross margin growth was driven by RPO, which was up 18% in the first quarter. The region delivered adjusted EBITDA of $0.2m, or 6.3% of revenue for the first quarter, as the company completed the reduction of stranded support costs during the fourth quarter of 2015. Adjusted EBITDA in the first quarter of 2015 was a loss of $0.8m.
Hudson Asia Pacific's gross margin decreased 4% in constant currency in the first quarter of 2016 from the same period in 2015, following eight consecutive quarters of year-over-year constant currency gross margin growth. Gross margin growth in Australia/New Zealand of 6% was more than offset by a 22% decline in Asia, driven by softer conditions in China, compared with the first quarter of 2015. RPO delivered strong gross margin growth of 20%, driven primarily by Australia, up 41% from new client wins and higher volume at existing clients. Asia Pacific delivered an adjusted EBITDA loss of $0.2m, down from adjusted EBITDA of $0.9m in the first quarter of 2015.
Hudson Europe's gross margin decreased 1% in constant currency on a retained basis from the first quarter of 2015, and 12% on a reported basis. Continental Europe gross margin increased by 3% in constant currency on a retained basis, in the quarter, led by growth in Belgium. In the U.K., 18% growth in RPO was offset by a 10% decline in recruitment. Adjusted EBITDA was $0.5m, or 1.0% of revenue, in the first quarter of 2016, compared with adjusted EBITDA of $0.0m a year ago.