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Share Name | Share Symbol | Market | Type |
---|---|---|---|
PRGX Global Inc | NASDAQ:PRGX | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 7.71 | 7.71 | 9.00 | 0 | 01:00:00 |
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Georgia
|
|
58-2213805
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
incorporation or organization)
|
|
Identification No.)
|
|
|
|
600 Galleria Parkway
|
|
30339-5986
|
Suite 100
|
|
(Zip Code)
|
Atlanta, Georgia
|
|
|
(Address of principal executive offices)
|
|
|
¨
Large accelerated filer
|
ý
|
Accelerated filer
|
||
¨
Non-accelerated filer (Do not check if a smaller reporting company)
|
¨
|
Smaller reporting company
|
|
Page No.
|
Part I.
Financial Information
|
|
Part II.
Other Information
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Revenue
|
|
$
|
35,291
|
|
|
$
|
36,995
|
|
|
$
|
66,524
|
|
|
$
|
69,980
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
|
23,431
|
|
|
24,111
|
|
|
45,077
|
|
|
47,278
|
|
||||
Selling, general and administrative expenses
|
|
9,620
|
|
|
9,185
|
|
|
18,468
|
|
|
17,129
|
|
||||
Depreciation of property and equipment
|
|
1,216
|
|
|
1,294
|
|
|
2,448
|
|
|
2,573
|
|
||||
Amortization of intangible assets
|
|
395
|
|
|
754
|
|
|
789
|
|
|
1,500
|
|
||||
Total operating expenses
|
|
34,662
|
|
|
35,344
|
|
|
66,782
|
|
|
68,480
|
|
||||
Operating income (loss)
|
|
629
|
|
|
1,651
|
|
|
(258
|
)
|
|
1,500
|
|
||||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
196
|
|
|
(416
|
)
|
|
(811
|
)
|
|
1,276
|
|
||||
Interest expense (income), net
|
|
(12
|
)
|
|
(53
|
)
|
|
(41
|
)
|
|
(95
|
)
|
||||
Other Income (loss)
|
|
18
|
|
|
—
|
|
|
28
|
|
|
—
|
|
||||
Income (loss) from continuing operations before income tax
|
|
427
|
|
|
2,120
|
|
|
566
|
|
|
319
|
|
||||
Income tax expense
|
|
460
|
|
|
296
|
|
|
664
|
|
|
751
|
|
||||
Net income (loss) from continuing operations
|
|
$
|
(33
|
)
|
|
$
|
1,824
|
|
|
$
|
(98
|
)
|
|
$
|
(432
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Discontinued operations:
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from discontinued operations
|
|
$
|
(559
|
)
|
|
$
|
(727
|
)
|
|
$
|
(1,046
|
)
|
|
$
|
(1,429
|
)
|
Other (income) loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Income tax expense (benefit)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss) from discontinued operations
|
|
$
|
(559
|
)
|
|
$
|
(727
|
)
|
|
$
|
(1,046
|
)
|
|
$
|
(1,429
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
|
$
|
(592
|
)
|
|
$
|
1,097
|
|
|
$
|
(1,144
|
)
|
|
$
|
(1,861
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) from continuing operations
(Note B)
|
|
$
|
—
|
|
|
$
|
0.07
|
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
Basic earnings (loss) from discontinued operations
|
|
(0.03
|
)
|
|
(0.03
|
)
|
|
(0.05
|
)
|
|
(0.05
|
)
|
||||
Total basic earnings (loss) per common share
|
|
$
|
(0.03
|
)
|
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.07
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings (loss) from continuing operations
|
|
$
|
—
|
|
|
$
|
0.07
|
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
Diluted earnings (loss) from discontinued operations
|
|
(0.03
|
)
|
|
(0.03
|
)
|
|
(0.05
|
)
|
|
(0.05
|
)
|
||||
Total diluted earnings (loss) per common share
|
|
$
|
(0.03
|
)
|
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.07
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average common shares outstanding
(Note B)
:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
21,969
|
|
|
26,497
|
|
|
22,202
|
|
|
26,446
|
|
||||
Diluted
|
|
21,969
|
|
|
26,553
|
|
|
22,202
|
|
|
26,446
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income (loss)
|
|
$
|
(592
|
)
|
|
$
|
1,097
|
|
|
$
|
(1,144
|
)
|
|
$
|
(1,861
|
)
|
Foreign currency translation adjustments
|
|
(118
|
)
|
|
183
|
|
|
(487
|
)
|
|
152
|
|
||||
Comprehensive income (loss)
|
|
$
|
(710
|
)
|
|
$
|
1,280
|
|
|
$
|
(1,631
|
)
|
|
$
|
(1,709
|
)
|
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
ASSETS
|
||||||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
15,174
|
|
|
$
|
15,122
|
|
Restricted cash
|
|
144
|
|
|
48
|
|
||
Receivables:
|
|
|
|
|
||||
Contract receivables, less allowances of $1,092 in 2016 and $930 in 2015:
|
|
|
|
|
||||
Billed
|
|
24,209
|
|
|
26,576
|
|
||
Unbilled
|
|
1,673
|
|
|
1,967
|
|
||
|
|
25,882
|
|
|
28,543
|
|
||
Employee advances and miscellaneous receivables, less allowances of $601 in 2016 and $681 in 2015
|
|
1,675
|
|
|
1,740
|
|
||
Total receivables
|
|
27,557
|
|
|
30,283
|
|
||
Prepaid expenses and other current assets
|
|
2,911
|
|
|
2,323
|
|
||
Total current assets
|
|
45,786
|
|
|
47,776
|
|
||
Property and equipment
|
|
61,106
|
|
|
59,747
|
|
||
Less accumulated depreciation and amortization
|
|
(49,986
|
)
|
|
(48,167
|
)
|
||
Property and equipment, net
|
|
11,120
|
|
|
11,580
|
|
||
Goodwill
|
|
11,729
|
|
|
11,810
|
|
||
Intangible assets, less accumulated amortization of $35,646 in 2016 and $35,708 in 2015
|
|
5,874
|
|
|
6,684
|
|
||
Noncurrent portion of unbilled receivables
|
|
760
|
|
|
656
|
|
||
Other assets
|
|
2,151
|
|
|
1,885
|
|
||
Total assets
|
|
$
|
77,420
|
|
|
$
|
80,391
|
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable and accrued expenses
|
|
$
|
6,834
|
|
|
$
|
5,966
|
|
Accrued payroll and related expenses
|
|
10,920
|
|
|
11,278
|
|
||
Refund liabilities
|
|
7,962
|
|
|
7,887
|
|
||
Deferred revenue
|
|
951
|
|
|
965
|
|
||
Other current liabilities
|
|
39
|
|
|
39
|
|
||
Total current liabilities
|
|
26,706
|
|
|
26,135
|
|
||
Noncurrent refund liabilities
|
|
786
|
|
|
752
|
|
||
Other long-term liabilities
|
|
1,322
|
|
|
1,089
|
|
||
Total liabilities
|
|
28,814
|
|
|
27,976
|
|
||
Commitments and contingencies
(Note G)
|
|
|
|
|
|
|
||
Shareholders’ equity
(Note B)
:
|
|
|
|
|
||||
Common stock, no par value; $.01 stated value per share. Authorized 50,000,000 shares; 21,831,025 shares issued and outstanding at June 30, 2016 and 22,681,656 shares issued and outstanding at December 31, 2015
|
|
218
|
|
|
227
|
|
||
Additional paid-in capital
|
|
573,363
|
|
|
575,532
|
|
||
Accumulated deficit
|
|
(525,282
|
)
|
|
(524,138
|
)
|
||
Accumulated other comprehensive income
|
|
307
|
|
|
794
|
|
||
Total shareholders’ equity
|
|
48,606
|
|
|
52,415
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
77,420
|
|
|
$
|
80,391
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net loss
|
|
$
|
(1,144
|
)
|
|
$
|
(1,861
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
3,244
|
|
|
4,096
|
|
||
Stock-based compensation expense
|
|
1,799
|
|
|
3,149
|
|
||
Loss on sale of fixed assets
|
|
14
|
|
|
—
|
|
||
Deferred income taxes
|
|
(267
|
)
|
|
191
|
|
||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
(811
|
)
|
|
1,276
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Restricted cash
|
|
(96
|
)
|
|
(109
|
)
|
||
Billed receivables
|
|
2,077
|
|
|
4,903
|
|
||
Unbilled receivables
|
|
190
|
|
|
1,490
|
|
||
Prepaid expenses and other current assets
|
|
(510
|
)
|
|
(513
|
)
|
||
Other assets
|
|
(44
|
)
|
|
31
|
|
||
Accounts payable and accrued expenses
|
|
1,105
|
|
|
(234
|
)
|
||
Accrued payroll and related expenses
|
|
(442
|
)
|
|
(4,133
|
)
|
||
Refund liabilities
|
|
109
|
|
|
(444
|
)
|
||
Deferred revenue
|
|
17
|
|
|
(351
|
)
|
||
Other long-term liabilities
|
|
221
|
|
|
(9
|
)
|
||
Net cash provided by operating activities
|
|
5,462
|
|
|
7,482
|
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchases of property and equipment, net of disposal proceeds
|
|
(2,138
|
)
|
|
(2,197
|
)
|
||
Net cash used in investing activities
|
|
(2,138
|
)
|
|
(2,197
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Restricted stock repurchased from employees for withholding taxes
|
|
(143
|
)
|
|
(280
|
)
|
||
Proceeds from option exercises
|
|
132
|
|
|
45
|
|
||
Repurchase of common stock
|
|
(3,658
|
)
|
|
(10,340
|
)
|
||
Net cash used in financing activities
|
|
(3,669
|
)
|
|
(10,575
|
)
|
||
|
|
|
|
|
||||
Effect of exchange rates on cash and cash equivalents
|
|
397
|
|
|
(763
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
|
52
|
|
|
(6,053
|
)
|
||
|
|
|
|
|
||||
Cash and cash equivalents at beginning of period
|
|
15,122
|
|
|
25,735
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
15,174
|
|
|
$
|
19,682
|
|
|
|
|
|
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
||||
Cash paid during the period for interest
|
|
$
|
15
|
|
|
$
|
14
|
|
Cash paid during the period for income taxes, net of refunds received
|
|
$
|
385
|
|
|
$
|
449
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
Basic earnings (loss) per common share:
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net earnings (loss) from continuing operations:
|
|
$
|
(33
|
)
|
|
$
|
1,824
|
|
|
$
|
(98
|
)
|
|
$
|
(432
|
)
|
Net earnings (loss) from discontinued operations:
|
|
$
|
(559
|
)
|
|
$
|
(727
|
)
|
|
$
|
(1,046
|
)
|
|
$
|
(1,429
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average basic common shares outstanding:
|
|
21,969
|
|
|
26,497
|
|
|
22,202
|
|
|
26,446
|
|
||||
Effect of dilutive securities from stock-based compensation plans
|
|
—
|
|
|
56
|
|
|
—
|
|
|
—
|
|
||||
Weighted-average diluted common shares outstanding:
|
|
$
|
21,969
|
|
|
$
|
26,553
|
|
|
$
|
22,202
|
|
|
$
|
26,446
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per common share from continuing operations:
|
|
$
|
—
|
|
|
$
|
0.07
|
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
Basic earnings (loss) per common share from discontinued operations:
|
|
$
|
(0.03
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.05
|
)
|
Total basic earnings (loss) per common share
|
|
$
|
(0.03
|
)
|
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.07
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings (loss) per common share from continuing operations:
|
|
$
|
—
|
|
|
$
|
0.07
|
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
Diluted earnings (loss) per common share from discontinued operations:
|
|
$
|
(0.03
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.05
|
)
|
Total diluted earnings (loss) per common share
|
|
$
|
(0.03
|
)
|
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.07
|
)
|
Grantee
Type
|
|
# of
Options
Granted
|
|
Vesting Period
|
|
Weighted
Average
Exercise Price
|
|
Weighted
Average Grant
Date Fair Value
|
|||||
2016
|
|
|
|
|
|
|
|
|
|||||
Director
|
|
175,000
|
|
|
1 year or less
|
|
$
|
5.04
|
|
|
$
|
2.72
|
|
Employee inducements
(1)
|
|
60,000
|
|
|
3 years
|
|
$
|
4.79
|
|
|
$
|
2.88
|
|
|
|
|
|
|
|
|
|
|
|||||
2015
|
|
|
|
|
|
|
|
|
|||||
Director
|
|
249,273
|
|
|
1 year or less
|
|
$
|
4.49
|
|
|
$
|
2.44
|
|
Director
|
|
17,092
|
|
|
3 years
|
|
$
|
3.99
|
|
|
$
|
1.33
|
|
Employee inducements
(2)
|
|
135,000
|
|
|
3 years
|
|
$
|
5.51
|
|
|
$
|
1.42
|
|
(1)
|
The Company granted non-qualified stock options outside its existing stock-based compensation plans in the first six months of 2016 in connection with an employee joining the Company.
|
(2)
|
The Company granted non-qualified stock options outside its existing stock-based compensation plans in the first six months of 2015 to
three
employees in connection with the employees joining the Company.
|
Grantee
Type
|
|
# of Shares
Granted
|
|
Vesting Period
|
|
Weighted
Average Grant
Date Fair Value
|
|||
2016
|
|
|
|
|
|
|
|||
Employee group
(1)
|
|
1,250,750
|
|
|
2 years
|
|
$
|
4.88
|
|
Employee inducements
(2)
|
|
90,000
|
|
|
2 years
|
|
$
|
4.94
|
|
|
|
|
|
|
|
|
|||
2015
|
|
|
|
|
|
|
|||
Director
|
|
4,273
|
|
|
1 year or less
|
|
$
|
4.02
|
|
Director
|
|
17,092
|
|
|
3 years
|
|
$
|
3.99
|
|
Employee group
(3)
|
|
1,325,000
|
|
|
2 years
|
|
$
|
4.00
|
|
Employee inducements
(4)
|
|
10,000
|
|
|
3 years
|
|
$
|
5.29
|
|
(1)
|
The Company granted nonvested performance-based stock awards (restricted stock units) in the first six months of 2016 to five executive officers, three senior business leaders and certain other employees.
|
(2)
|
The Company granted nonvested stock awards (restricted stock) outside its existing stock-based compensation plans in the second quarter of 2016 to
two
employees in connection with the employees joining the Company.
|
(3)
|
The Company granted nonvested performance-based stock awards (restricted stock units) in the first quarter of 2015 to
eight
executive officers.
|
(4)
|
The Company granted nonvested stock awards (restricted stock) outside its existing stock-based compensation plans in the first quarter of 2015 to
two
employees in connection with the employees joining the Company.
|
|
|
Recovery
Audit
Services –
Americas
|
|
Recovery Audit
Services –
Europe/Asia-
Pacific
|
|
Adjacent
Services
|
|
Corporate
Support
|
|
Total
|
||||||||||
Three Months Ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
$
|
25,122
|
|
|
$
|
8,698
|
|
|
$
|
1,471
|
|
|
$
|
—
|
|
|
$
|
35,291
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
$
|
(33
|
)
|
||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
|
460
|
|
|||||||||
Interest expense (income), net
|
|
|
|
|
|
|
|
|
|
(12
|
)
|
|||||||||
EBIT
|
|
$
|
5,998
|
|
|
$
|
505
|
|
|
$
|
(488
|
)
|
|
$
|
(5,600
|
)
|
|
415
|
|
|
Depreciation of property and equipment
|
|
936
|
|
|
140
|
|
|
140
|
|
|
—
|
|
|
1,216
|
|
|||||
Amortization of intangible assets
|
|
373
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
395
|
|
|||||
EBITDA
|
|
7,307
|
|
|
645
|
|
|
(326
|
)
|
|
(5,600
|
)
|
|
2,026
|
|
|||||
Other expense (income)
|
|
|
|
|
|
18
|
|
|
|
|
18
|
|
||||||||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
30
|
|
|
185
|
|
|
7
|
|
|
(26
|
)
|
|
196
|
|
|||||
Transformation severance and related expenses
|
|
276
|
|
|
25
|
|
|
—
|
|
|
(76
|
)
|
|
225
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,035
|
|
|
1,035
|
|
|||||
Adjusted EBITDA
|
|
$
|
7,613
|
|
|
$
|
855
|
|
|
$
|
(301
|
)
|
|
$
|
(4,667
|
)
|
|
$
|
3,500
|
|
|
|
Recovery
Audit
Services –
Americas
|
|
Recovery Audit
Services –
Europe/Asia-
Pacific
|
|
Adjacent
Services
|
|
Corporate
Support
|
|
Total
|
||||||||||
Three Months Ended June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
$
|
25,350
|
|
|
$
|
9,950
|
|
|
$
|
1,695
|
|
|
$
|
—
|
|
|
$
|
36,995
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
$
|
1,824
|
|
||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
|
296
|
|
|||||||||
Interest expense (income), net
|
|
|
|
|
|
|
|
|
|
(53
|
)
|
|||||||||
EBIT
|
|
$
|
6,505
|
|
|
$
|
1,796
|
|
|
$
|
(1,041
|
)
|
|
$
|
(5,193
|
)
|
|
2,067
|
|
|
Depreciation of property and equipment
|
|
979
|
|
|
153
|
|
|
162
|
|
|
—
|
|
|
1,294
|
|
|||||
Amortization of intangible assets
|
|
441
|
|
|
280
|
|
|
33
|
|
|
—
|
|
|
754
|
|
|||||
EBITDA
|
|
7,925
|
|
|
2,229
|
|
|
(846
|
)
|
|
(5,193
|
)
|
|
4,115
|
|
|||||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
(179
|
)
|
|
(246
|
)
|
|
1
|
|
|
8
|
|
|
(416
|
)
|
|||||
Transformation severance and related expenses
|
|
108
|
|
|
203
|
|
|
14
|
|
|
26
|
|
|
351
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,017
|
|
|
2,017
|
|
|||||
Adjusted EBITDA
|
|
$
|
7,854
|
|
|
$
|
2,186
|
|
|
$
|
(831
|
)
|
|
$
|
(3,142
|
)
|
|
$
|
6,067
|
|
|
|
Recovery
Audit
Services –
Americas
|
|
Recovery Audit
Services –
Europe/Asia-
Pacific
|
|
Adjacent
Services
|
|
Corporate
Support
|
|
Total
|
||||||||||
Six Months Ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
$
|
46,689
|
|
|
$
|
17,947
|
|
|
$
|
1,888
|
|
|
$
|
—
|
|
|
$
|
66,524
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
$
|
(98
|
)
|
||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
|
664
|
|
|||||||||
Interest expense (income), net
|
|
|
|
|
|
|
|
|
|
(41
|
)
|
|||||||||
EBIT
|
|
$
|
9,996
|
|
|
$
|
2,759
|
|
|
$
|
(1,574
|
)
|
|
$
|
(10,656
|
)
|
|
525
|
|
|
Depreciation of property and equipment
|
|
1,928
|
|
|
238
|
|
|
282
|
|
|
—
|
|
|
2,448
|
|
|||||
Amortization of intangible assets
|
|
745
|
|
|
—
|
|
|
44
|
|
|
—
|
|
|
789
|
|
|||||
EBITDA
|
|
12,669
|
|
|
2,997
|
|
|
(1,248
|
)
|
|
(10,656
|
)
|
|
3,762
|
|
|||||
Other expense (income)
|
|
|
|
|
|
28
|
|
|
|
|
28
|
|
||||||||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
(228
|
)
|
|
(561
|
)
|
|
6
|
|
|
(28
|
)
|
|
(811
|
)
|
|||||
Transformation severance and related expenses
|
|
420
|
|
|
96
|
|
|
—
|
|
|
243
|
|
|
759
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,799
|
|
|
1,799
|
|
|||||
Adjusted EBITDA
|
|
$
|
12,861
|
|
|
$
|
2,532
|
|
|
$
|
(1,214
|
)
|
|
$
|
(8,642
|
)
|
|
$
|
5,537
|
|
|
|
Recovery
Audit
Services –
Americas
|
|
Recovery Audit
Services –
Europe/Asia-
Pacific
|
|
Adjacent
Services
|
|
Corporate
Support
|
|
Total
|
||||||||||
Six Months Ended June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
$
|
47,767
|
|
|
$
|
19,255
|
|
|
$
|
2,958
|
|
|
$
|
—
|
|
|
$
|
69,980
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from continuing operations
|
|
|
|
|
|
|
|
|
|
$
|
(432
|
)
|
||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
|
751
|
|
|||||||||
Interest expense (income), net
|
|
|
|
|
|
|
|
|
|
(95
|
)
|
|||||||||
EBIT
|
|
$
|
10,583
|
|
|
$
|
1,354
|
|
|
$
|
(1,926
|
)
|
|
$
|
(9,787
|
)
|
|
224
|
|
|
Depreciation of property and equipment
|
|
1,948
|
|
|
306
|
|
|
319
|
|
|
—
|
|
|
2,573
|
|
|||||
Amortization of intangible assets
|
|
882
|
|
|
553
|
|
|
65
|
|
|
—
|
|
|
1,500
|
|
|||||
EBITDA
|
|
13,413
|
|
|
2,213
|
|
|
(1,542
|
)
|
|
(9,787
|
)
|
|
4,297
|
|
|||||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
258
|
|
|
1,072
|
|
|
1
|
|
|
(55
|
)
|
|
1,276
|
|
|||||
Transformation severance and related expenses
|
|
164
|
|
|
268
|
|
|
30
|
|
|
35
|
|
|
497
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,149
|
|
|
3,149
|
|
|||||
Adjusted EBITDA
|
|
$
|
13,835
|
|
|
$
|
3,553
|
|
|
$
|
(1,511
|
)
|
|
$
|
(6,658
|
)
|
|
$
|
9,219
|
|
•
|
Diverse client base – our clients include a diverse mix of discounters, grocery, pharmacy, department and other stores that tend to be impacted to varying degrees by general economic fluctuations, and even in opposite directions from each other depending on their position in the market and their market segment;
|
•
|
Motivation – when our clients experience a downturn, they frequently are more motivated to use our services to recover prior overpayments to make up for relatively weaker financial performance in their own business operations;
|
•
|
Nature of claims – the relationship between the dollar amount of recovery audit claims identified and client purchases is non-linear. Claim volumes are generally impacted by purchase volumes, but a number of other factors may have an even more significant impact on claim volumes, including new items being purchased, changes in discount, rebate, marketing allowance and similar programs offered by vendors and changes in a client’s or a vendor’s information processing systems; and
|
•
|
Timing – the client purchase data on which we perform our recovery audit services is historical data that typically reflects transactions between our clients and their vendors that took place 3 to 15 months prior to the data being provided to us for audit. As a result, we generally experience a delayed impact from economic changes that varies by client and the impact may be positive or negative depending on the individual clients’ circumstances.
|
a)
|
We already have the data - we serve a large and impressive list of very large, multinational companies in our core recovery audit business, which requires access to and processing of these clients' detailed P2P data on a daily, weekly or at least periodic basis;
|
b)
|
We know the data and underlying processes - the work we do in recovery audit requires that we fully understand our clients’ systems, buying practices, receiving and payment procedures, as well as their suppliers’ contracting, performance and billing practices;
|
c)
|
We take a different perspective in analyzing the data - we look horizontally across our clients' processes and organizational structures versus vertically, which is how most companies are organized and Enterprise Resource Planning systems are designed; and
|
d)
|
Our contingent fee recovery audit value proposition minimizes our clients' cost of entry and truly aligns us with our clients.
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Recovery Audit Services – Americas
|
|
$
|
25,122
|
|
|
$
|
25,350
|
|
|
$
|
46,689
|
|
|
$
|
47,767
|
|
Recovery Audit Services – Europe/Asia-Pacific
|
|
8,698
|
|
|
9,950
|
|
|
17,947
|
|
|
19,255
|
|
||||
Adjacent Services
|
|
1,471
|
|
|
1,695
|
|
|
1,888
|
|
|
2,958
|
|
||||
Total
|
|
$
|
35,291
|
|
|
$
|
36,995
|
|
|
$
|
66,524
|
|
|
$
|
69,980
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Recovery Audit Services – Americas
|
|
$
|
15,614
|
|
|
$
|
15,162
|
|
|
$
|
29,938
|
|
|
$
|
30,133
|
|
Recovery Audit Services – Europe/Asia-Pacific
|
|
6,261
|
|
|
6,607
|
|
|
12,373
|
|
|
13,044
|
|
||||
Adjacent Services
|
|
1,556
|
|
|
2,342
|
|
|
2,766
|
|
|
4,101
|
|
||||
Total
|
|
$
|
23,431
|
|
|
$
|
24,111
|
|
|
$
|
45,077
|
|
|
$
|
47,278
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Recovery Audit Services – Americas
|
|
$
|
2,171
|
|
|
$
|
2,442
|
|
|
$
|
4,310
|
|
|
$
|
3,963
|
|
Recovery Audit Services – Europe/Asia-Pacific
|
|
1,608
|
|
|
1,360
|
|
|
3,138
|
|
|
2,926
|
|
||||
Adjacent Services
|
|
216
|
|
|
198
|
|
|
336
|
|
|
398
|
|
||||
Subtotal for reportable segments
|
|
3,995
|
|
|
4,000
|
|
|
7,784
|
|
|
7,287
|
|
||||
Corporate Support
|
|
5,625
|
|
|
5,185
|
|
|
10,684
|
|
|
9,842
|
|
||||
Total
|
|
$
|
9,620
|
|
|
$
|
9,185
|
|
|
$
|
18,468
|
|
|
$
|
17,129
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Recovery Audit Services – Americas
|
|
$
|
936
|
|
|
$
|
979
|
|
|
$
|
1,928
|
|
|
$
|
1,948
|
|
Recovery Audit Services – Europe/Asia-Pacific
|
|
140
|
|
|
153
|
|
|
238
|
|
|
306
|
|
||||
Adjacent Services
|
|
140
|
|
|
162
|
|
|
282
|
|
|
319
|
|
||||
Total
|
|
$
|
1,216
|
|
|
$
|
1,294
|
|
|
$
|
2,448
|
|
|
$
|
2,573
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Recovery Audit Services – Americas
|
|
$
|
373
|
|
|
$
|
441
|
|
|
$
|
745
|
|
|
$
|
882
|
|
Recovery Audit Services – Europe/Asia-Pacific
|
|
—
|
|
|
280
|
|
|
—
|
|
|
553
|
|
||||
Adjacent Services
|
|
22
|
|
|
33
|
|
|
44
|
|
|
65
|
|
||||
Total
|
|
$
|
395
|
|
|
$
|
754
|
|
|
$
|
789
|
|
|
$
|
1,500
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income (loss)
|
|
$
|
(592
|
)
|
|
$
|
1,097
|
|
|
$
|
(1,144
|
)
|
|
$
|
(1,861
|
)
|
Income tax expense
|
|
460
|
|
|
296
|
|
|
664
|
|
|
751
|
|
||||
Interest expense (income), net
|
|
(12
|
)
|
|
(53
|
)
|
|
(41
|
)
|
|
(95
|
)
|
||||
EBIT
|
|
(144
|
)
|
|
1,340
|
|
|
(521
|
)
|
|
(1,205
|
)
|
||||
Depreciation of property and equipment
|
|
1,219
|
|
|
1,304
|
|
|
2,455
|
|
|
2,596
|
|
||||
Amortization of intangible assets
|
|
395
|
|
|
754
|
|
|
789
|
|
|
1,500
|
|
||||
EBITDA
|
|
1,470
|
|
|
3,398
|
|
|
2,723
|
|
|
2,891
|
|
||||
Foreign currency transaction (gains) losses on short-term intercompany balances
|
|
196
|
|
|
(416
|
)
|
|
(811
|
)
|
|
1,276
|
|
||||
Transformation severance and related expenses
|
|
557
|
|
|
562
|
|
|
1,095
|
|
|
708
|
|
||||
Other gains and losses
|
|
18
|
|
|
—
|
|
|
28
|
|
|
—
|
|
||||
Stock-based compensation
|
|
1,035
|
|
|
2,017
|
|
|
1,799
|
|
|
3,149
|
|
||||
Adjusted EBITDA
|
|
$
|
3,276
|
|
|
$
|
5,561
|
|
|
$
|
4,834
|
|
|
$
|
8,024
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Recovery Audit Services – Americas
|
|
$
|
7,613
|
|
|
$
|
7,854
|
|
|
$
|
12,861
|
|
|
$
|
13,835
|
|
Recovery Audit Services – Europe/Asia-Pacific
|
|
855
|
|
|
2,186
|
|
|
2,532
|
|
|
3,553
|
|
||||
Adjacent Services
|
|
(301
|
)
|
|
(831
|
)
|
|
(1,214
|
)
|
|
(1,511
|
)
|
||||
Subtotal for reportable segments
|
|
8,167
|
|
|
9,209
|
|
|
14,179
|
|
|
15,877
|
|
||||
Corporate Support
|
|
(4,667
|
)
|
|
(3,142
|
)
|
|
(8,642
|
)
|
|
(6,658
|
)
|
||||
Total
|
|
$
|
3,500
|
|
|
$
|
6,067
|
|
|
$
|
5,537
|
|
|
$
|
9,219
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
Net loss
|
|
$
|
(1,144
|
)
|
|
$
|
(1,861
|
)
|
Adjustments for certain non-cash items
|
|
4,232
|
|
|
8,712
|
|
||
|
|
3,088
|
|
|
6,851
|
|
||
Changes in operating assets and liabilities
|
|
2,374
|
|
|
631
|
|
||
Net cash provided by operating activities
|
|
$
|
5,462
|
|
|
$
|
7,482
|
|
2016
|
|
Total Number
of Shares
Purchased (a)
|
|
Average Price
Paid per Share
|
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs (b)
|
|
Maximum Approximate
Dollar Value of Shares
that May Yet Be
Purchased Under the
Plans or Programs
|
||||||
|
|
|
|
|
|
|
|
(millions of dollars)
|
||||||
April 1 - April 30
|
|
147,761
|
|
|
$
|
4.74
|
|
|
147,761
|
|
|
$
|
—
|
|
May1 - May 31
|
|
76,784
|
|
|
$
|
4.76
|
|
|
70,244
|
|
|
$
|
—
|
|
June 1 - June 30
|
|
28,047
|
|
|
$
|
5.13
|
|
|
—
|
|
|
$
|
—
|
|
|
|
252,592
|
|
|
$
|
4.79
|
|
|
218,005
|
|
|
$
|
5.6
|
|
(a)
|
Shares purchased during the quarter include shares surrendered by employees to satisfy tax withholding obligations upon vesting of restricted stock and shares from the Company's stock repurchase program.
|
(b)
|
On February 21, 2014, our Board of Directors authorized a stock repurchase program under which we may repurchase up to $10.0 million of our common stock from time to time through March 31, 2015. In March 2014, our Board of Directors authorized a $10.0 million increase to the stock repurchase program. In October 2014, our Board of Directors authorized a $20.0 million increase to the stock repurchase program. In October 2015, our Board of Directors authorized a $10.0 million increase to the stock repurchase program, increasing the total stock repurchase program since its inception to $50.0 million, and extended the duration of the program to December 31, 2016. From the February 2014 announcement of the Company’s current stock repurchase program through June 30, 2016, the Company has repurchased 8.6 million shares, or 28.6%, of its common stock outstanding on the date of the announcement, for an aggregate cost of $44.4 million. The timing and amount of repurchases, if any, will depend upon the Company’s stock price, economic and market conditions, regulatory requirements, and other corporate considerations. The Company may initiate, suspend or discontinue purchases under the stock repurchase program at any time.
|
Exhibit
Number
|
|
Description
|
|
3.1
|
|
|
Restated Articles of Incorporation of the Registrant, as amended and corrected through August 11, 2006 (restated solely for the purpose of filing with the Commission) (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed on August 17, 2006).
|
|
|
||
3.1.1
|
|
|
Articles of Amendment of the Registrant effective January 20, 2010 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed on January 25, 2010).
|
|
|
||
3.2
|
|
|
Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed on December 11, 2007).
|
|
|
||
4.1
|
|
|
Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registrant’s Form 10-K for the year ended December 31, 2001).
|
|
|
||
4.2
|
|
|
See Restated Articles of Incorporation and Bylaws of the Registrant, filed as Exhibits 3.1 and 3.2, respectively.
|
|
|
|
|
10.1
|
|
|
Employment Agreement between the Registrant and Louise P. Winstone dated April 25, 2016.
|
|
|
|
|
10.2
|
|
|
Employment Agreement between the Registrant and Salvatore DePrima dated May 5, 2016.
|
|
|
|
|
31.1
|
|
|
Certification of the Chief Executive Officer, pursuant to Rule 13a-14(a) or 15d-14(a), for the quarter ended June 30, 2016.
|
|
|
||
31.2
|
|
|
Certification of the Chief Financial Officer, pursuant to Rule 13a-14(a) or 15d-14(a), for the quarter ended June 30, 2016.
|
|
|
||
32.1
|
|
|
Certification of the Chief Executive Officer and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, for the quarter ended June 30, 2016.
|
|
|
|
|
101.INS
|
|
|
XBRL Instance Document
|
|
|
|
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
PRGX GLOBAL, INC.
|
||
|
|
|
|
August 5, 2016
|
By:
|
|
/s/ Ronald E. Stewart
|
|
|
|
Ronald E. Stewart
|
|
|
|
President, Chief Executive Officer, Director
(Principal Executive Officer)
|
|
|
|
|
August 5, 2016
|
By:
|
|
/s/ Peter Limeri
|
|
|
|
Peter Limeri
|
|
|
|
Chief Financial Officer and Treasurer
(Principal Financial Officer)
|
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