November 16, 2021 – Old Greenwich, Conn.-based recruiting firm Hudson Global Inc. / (NASDAQ:HSON) has posted third quarter of $45 million, an increase of 77.1 percent from the third quarter of 2020 and 71.8 percent in constant currency. This surpassed the Zacks consensus estimate by 11.55 percent. The company has topped consensus revenue estimates four times over the last four quarters. By region, Hudson Asia Pacific was up 58 percent, while the Americas were up 280 percent and Europe increased 39 percent.
The recruiting firm posted net income of $1.5 million, or $0.49 per basic and diluted share, compared with a net loss of $1.2 million, or $0.41 per basic and diluted share, for the third quarter of 2020. Adjusted net income per diluted share (non-GAAP measure) was $0.78 compared to adjusted net loss per diluted share of $0.38 in the third quarter of 2020. The Zacks consensus estimate was expecting a loss of $0.13.
“Our business exhibited very strong growth in revenue, adjusted net revenue, and adjusted EBITDA across all three regions in the third quarter of 2021 versus the prior year quarter,” said Jeff Eberwein, CEO of Hudson Global. “I continue to be particularly encouraged by the success and collaboration of our sales teams globally as our new business pipeline remains robust and growing. Coit Group, our 2020 acquisition, has significantly outperformed our expectations this year and we are very excited to see what Karani, our new 2021 acquisition, will be able to do as part of Hudson RPO.”
Hudson Global acquired Karani, a Chicago-headquartered recruiting services provider that serves mainly U.S.-based customers from its operations in India and the Philippines. Financial terms of the deal were not disclosed.
Karani partners with recruitment and staffing firms to assist with recruiting, sourcing, screening, onboarding and other talent-related services across a variety of industries. Karani has about 500 employees in India and 100 in the Philippines. “All current employees of Karani and its subsidiaries will be joining Hudson RPO, except for owner and CEO Dan Williams,” said Mr. Eberwein. “Dan will be retiring from his leadership role at Karani and its subsidiaries but will be an advisor to us for a period of 12 months. We congratulate Dan on his many successes in the human capital management industry over his long, storied career and wish him well in his future retirement.”
“Everyone at Karani and its subsidiaries should be very proud of this milestone; it is a testament to their hard work and dedication to our clients,” Mr. Williams said. “Karani is thrilled to join forces with Hudson RPO to accelerate growth, continue to provide excellent service to existing clients, begin to serve Hudson RPO’s clients and together win enterprise RPO business around the world.”
Hudson Global said it is vigilantly monitoring the business environment surrounding COVID-19 and that it continues to proactively address this situation as it evolves. The company said it believes it can continue to take appropriate actions to manage the business in this challenging environment due to the flexibility of its workforce and the strength of its balance sheet.
Since the beginning of 2019, Hudson Global has reduced its share count by 15 percent and continues to view share repurchases as an attractive use of capital. Under its $10 million common stock share repurchase program, the company has $1.7 million remaining.
Hudson Global shares have added about 75.3 percent since the beginning of the year versus the S&P 500’s gain of 24.6 percent.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media