Gross profit increases over 34% YoY in Q1 for Staffing 360 Solutions
Staffing 360 Solutions, Inc. has released its financial results for its fiscal quarter ended 31st August 2016.
As a result of the Company's numerous acquisitions and strong organic growth, revenues increased 33.1% to $47.8m in the fiscal quarter ended 31st August 2016, compared to $35.9m for the same period in 2015. Gross profit increased to over $8.5m, compared to $6.3m for the same period in 2015, a 34.3% increase. This represents gross margin of 17.8% compared to 17.6% respectively.
The Company's net loss for the quarter ended 31st August2016 was $1.3m, compared to a net loss of $1.7m for the same period in 2015, a decrease of 22.2%. The net loss was attributable primarily to non-cash accounting charges, as well as professional, legal, capital raising and other non-recurring expenses.
"This quarter has been a great start to the fiscal year," commented Brendan Flood (pictured), executive chairman of Staffing 360 Solutions. "With $47.8 million of revenue for the three months ended August 31st, we are now at a current run-rate over $190 million of revenue. Not only are we growing rapidly as a result of the acquisitions we have completed since this time one year ago, including Lighthouse Placement Services and The JM Group, we are also showing strong organic growth of over 14% year over year.
"Our metrics are improving on almost every front, especially our bottom line.
“We posted our strongest Adjusted EBITDA result in our Company's history - $1.8 million for the quarter ended August 2016. This puts us on a trailing twelve month Adjusted EBITDA of $5.3 million, exceeding our prior year results for the same period by over 200%. We are pleased with the progress we have made and the stage we are setting for future growth."
"This has been a significant quarter for Staffing 360 Solutions," stated David Faiman, chief financial officer. "We achieved operating profit for the first time in our history, we are realizing economies of scale, and we are continuing to improve our balance sheet. In Q1 2017, our working capital deficiency improved by approximately $500,000 and stockholder's equity increased from $7.5 million to $8.2 million in the current quarter. We have also improved debt levels with the equity we have raised through our S-3 registration statement. We now have $5.3 million of trailing twelve month Adjusted EBITDA compared to $9.7 million of net debt, resulting in a 1.9x leverage ratio."
The company has announced a new office location in Concord, North Carolina. This new location represents the Company's third office in North Carolina since expanding into the state three years ago and is beginning to contribute to overall sales now that the space is fully staffed and operational.
Staffing 360 opened the Nasdaq market on 15th August 2016. As a Nasdaq-listed company, Staffing 360's ability to communicate its progress with a broader audience is expected to increase, especially as trading volume continues to rise to all-time new levels.
The company raised $5.3m in equity through the August quarter, utilising the Company's S-3 registration statement, which became effective in March 2016. The Company believes this represents a major step toward achieving its larger initiatives as it continues to grow the business while paying down and reducing debt.
"Staffing 360 Solutions continues to grow at a record pace," said Matt Briand, president and CEO. "Both our M&A activity, as well as our strong operational improvements from our business units have driven our results higher. Although expanding over 30% overall is impressive, delivering 14% organic growth year over year is a significant achievement. We have boosted growth by winning several new annual contracts in the consumer goods, education and beverage industries, which are expected to show more impact over the coming quarters."