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Willdan Group Reports Third Quarter 2023 Results

Willdan Group, Inc. (“Willdan”) (Nasdaq: WLDN) today reported financial results for its third quarter ended September 29, 2023.

“We delivered another quarter of strong results in revenue, profit, and cash,” said Tom Brisbin, Willdan’s Chairman and Chief Executive Officer. “Our strategy to provide affordable solutions to reduce the amount of electricity and natural gas that people use is working. For the nine months, consolidated contract revenue grew 12.2% while net revenue grew 16.6%. Based on our year-to-date results and continued positive momentum in the fourth quarter, we are raising our full-year guidance for all financial targets.”

Third Quarter 2023 Highlights*

  • Consolidated contract revenue of $132.7 million, up 9.3%.
  • Net revenue** of $65.3 million, up 10.8%.
  • Net income of $1.6 million, up from $0.1 million.
  • Adjusted EBITDA** of $10.1 million, up 27.0%.
  • GAAP Diluted EPS of $0.11, up from $0.01.
  • Adjusted Diluted EPS** of $0.37, down 11.9%.

Nine Months Year to Date 2023 Highlights*

  • Consolidated contract revenue of $354.4 million, up 12.2%.
  • Net revenue** of $188.9 million, up 16.6%.
  • Net income of $2.9 million, up from net loss of $(8.0) million.
  • Adjusted EBITDA** of $28.2 million, up 145.6%.
  • GAAP Diluted EPS of $0.21, up from $(0.62).
  • Adjusted Diluted EPS** of $0.95, up 86.3%.

Fiscal Year 2023 Financial Targets

Willdan is increasing all of its financial targets for 2023 and now expects¥:

  • Net revenue** growth between 10% and 12%.
  • Adjusted Diluted EPS** between $1.33 per share and $1.38 per share.
  • Adjusted EBITDA** between $40 million and $42 million.

*As compared to the same period of fiscal 2022.

**See “Use of Non-GAAP Financial Measures” below.

¥ These updated financial targets supersede any previously disclosed financial targets and investors should not rely on any previously disclosed financial targets, and do not include any uncompleted or future acquisitions.

Third Quarter 2023 Conference Call

Willdan will be hosting a conference call to discuss its third quarter financial results today, at 5:30 p.m. Eastern/2:30 p.m. Pacific. To access the call, listeners should dial 866-682-6100 (or 862-298-0702) approximately five minutes prior to the scheduled start time. The conference call will be webcast simultaneously on Willdan’s website at https://edge.media-server.com/mmc/p/i3g848wa.

A replay of the conference call will be available through Willdan’s website at https://ir.willdangroup.com/events-presentations and selecting “Events & Presentations”.

An Investor Report containing supplemental financial information can also be accessed through Willdan’s website at https://ir.willdangroup.com and selecting “Stock Information”.

About Willdan Group, Inc.

Willdan is a nationwide provider of professional, technical and consulting services to utilities, government agencies, and private industry. Willdan’s service offerings span a broad set of complementary disciplines that include electric grid solutions, energy efficiency and sustainability, engineering and planning, and municipal financial consulting. For additional information, visit Willdan's website at www.willdan.com.

Use of Non-GAAP Financial Measures

“Net Revenue,” defined as contract revenue as reported in accordance with GAAP minus subcontractor services and other direct costs, is a non-GAAP financial measure. Net Revenue is a supplemental measure that Willdan believes enhances investors’ ability to analyze Willdan’s business trends and performance because it substantially measures the work performed by Willdan’s employees. In the course of providing services, Willdan routinely subcontracts various services. Generally, these subcontractor services and other direct costs are passed through to Willdan’s clients and, in accordance with U.S. generally accepted accounting principles (“GAAP”) and industry practice, are included in Willdan’s revenue when it is Willdan’s contractual responsibility to procure or manage such subcontracted activities. Because subcontractor services and other direct costs can vary significantly from project to project and period to period, changes in revenue may not necessarily be indicative of Willdan’s business trends. Accordingly, Willdan segregates subcontractor services and other direct costs from revenue to promote a better understanding of Willdan’s business by evaluating revenue exclusive of subcontract services and other direct costs associated with external service providers. A reconciliation of Willdan’s contract revenue as reported in accordance with GAAP to Net Revenue is provided at the end of this press release. A reconciliation of targeted contract revenue for the full fiscal year 2023 as reported in accordance with GAAP to targeted Net Revenues for fiscal year 2023, which is a forward-looking non-GAAP financial measure, is not provided because Willdan is unable to provide such reconciliation without unreasonable effort. The inability to provide a reconciliation is due to the uncertainty and inherent difficulty of predicting the subcontractor services and other director costs that are subtracted from contract revenues in order to derive Net Revenues. While subcontractor costs have increased recently, subcontractor costs can vary significantly from period to period. Subcontractor costs and other direct costs were 50.8% and 47.2% of contract revenue for the quarter ended September 29, 2023 and fiscal year 2022, respectively, and 51.4% and 43.0% for the quarter ended September 30, 2022 and fiscal year 2021, respectively.

“Adjusted EBITDA,” defined as net income plus interest expense, income tax expense, stock-based compensation, interest accretion, depreciation and amortization, and gain on sale of equipment, is a non-GAAP financial measure. Adjusted EBITDA is a supplemental measure used by Willdan’s management to measure Willdan’s operating performance. Willdan believes Adjusted EBITDA is useful because it allows Willdan’s management to evaluate its operating performance and compare the results of its operations from period to period and against its peers without regard to its financing methods, capital structure and non-operating expenses. Willdan uses Adjusted EBITDA to evaluate its performance for, among other things, budgeting, forecasting and incentive compensation purposes.

Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company’s financial performance, such as a company’s costs of capital and stock-based compensation, as well as the historical costs of depreciable assets. A reconciliation of net income as reported in accordance with GAAP to Adjusted EBITDA is provided at the end of this press release. A reconciliation of targeted net income for the full fiscal year 2023 as reported in accordance with GAAP to Adjusted EBITDA for fiscal year 2023, which is a forward-looking non-GAAP financial measure, is not provided because Willdan is unable to provide such reconciliation without unreasonable effort. The inability to provide a reconciliation is due to the uncertainty and inherent difficulty of predicting the interest expense, income tax expense, stock-based compensation, interest accretion, depreciation and amortization, and gain on sale of equipment that are subtracted from net income in order to derive Adjusted EBITDA.

“Adjusted Net Income,” defined as net income plus stock-based compensation, intangible amortization, and interest accretion, each net of tax, is a non-GAAP financial measure.

“Adjusted Diluted EPS,” defined as net income plus stock-based compensation, intangible amortization, and interest accretion, each net of tax, all divided by the diluted weighted-average shares outstanding, is a non-GAAP financial measure. Adjusted Net Income and Adjusted Diluted EPS are supplemental measures used by Willdan’s management to measure its operating performance. Willdan believes Adjusted Net Income and Adjusted Diluted EPS are useful because they allow Willdan’s management to more closely evaluate and explain the operating results of Willdan’s business by removing certain non-operating expenses. Reconciliations of net income as reported in accordance with GAAP to Adjusted Net Income and diluted EPS as reported in accordance with GAAP to Adjusted Diluted EPS are provided at the end of this press release. Reconciliations of targeted net income as reported in accordance with GAAP to targeted Adjusted Net Income for the full fiscal year 2023, which is a forward-looking non-GAAP financial measure, and targeted diluted EPS as reported in accordance with GAAP to targeted Adjusted Diluted EPS for the full fiscal year 2023, which is a forward-looking non-GAAP financial measure, are not provided because Willdan is unable to provide such reconciliations without unreasonable effort. The inability to provide such reconciliations is due to the uncertainty and inherent difficulty of predicting the stock-based compensation, intangible amortization, and interest accretion, each net of tax, that are subtracted from net income and diluted EPS in order to derive Adjusted Net Income and Adjusted Diluted EPS, respectively.

Willdan’s definitions of Net Revenue, Adjusted EBITDA, Adjusted Net Income and Adjusted Diluted EPS have limitations as analytical tools and may differ from other companies reporting similarly named measures or from similarly named measures Willdan has reported in prior periods. These measures should be considered in addition to, and not as a substitute for, or superior to, other measures of financial performance prepared in accordance with GAAP, such as contract revenue, net income and diluted EPS.

Forward Looking Statements

Statements in this press release that are not purely historical, including statements regarding Willdan’s intentions, hopes, beliefs, expectations, representations, projections, estimates, plans or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including statements regarding Willdan’s ability to capitalize on increased energy efficiency spending in large markets and expected benefits from its acquisitions. All statements other than statements of historical fact included in this press release are forward-looking statements. It is important to note that Willdan’s actual results could differ materially from those in any such forward-looking statements. Important factors that could cause actual results to differ materially from its expectations include, but are not limited to, Willdan’s ability to adequately complete projects in a timely manner, Willdan’s ability to compete successfully in the highly competitive energy services market, Willdan’s reliance on work from its top ten clients; changes in state, local and regional economies and government budgets; Willdan’s ability to win new contracts, to renew existing contracts and to compete effectively for contracts awarded through bidding processes; Willdan’s ability to make principal and interest payments on its outstanding debt as they come due and to comply with financial covenants contained in its debt agreements; Willdan’s ability to manage supply chain constraints, labor shortages, rising interest rates, and rising inflation; Willdan’s ability to obtain financing and to refinance its outstanding debt as it matures; Willdan’s ability to successfully integrate its acquisitions and execute on its growth strategy; and Willdan’s ability to attract and retain managerial, technical, and administrative talent.

All written and oral forward-looking statements attributable to Willdan, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements and risk factors disclosed from time to time in Willdan’s reports filed with the Securities and Exchange Commission, including, but not limited to, the Annual Report on Form 10-K filed for the year ended December 30, 2022, as such disclosures may be amended, supplemented or superseded from time to time by other reports Willdan files with the Securities and Exchange Commission, including subsequent Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. Willdan cautions investors not to place undue reliance on the forward-looking statements contained in this press release. Willdan disclaims any obligation to, and does not undertake to, update or revise any forward-looking statements in this press release unless required by law.

WILLDAN GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value)

 

 

 

 

 

 

 

 

 

 

September 29,

 

December 30,

 

 

 

2023

 

2022

 

Assets

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

12,887

 

$

8,806

 

Restricted cash

 

 

 

 

10,679

 

Accounts receivable, net of allowance for doubtful accounts of $263 and $640 at September 29, 2023 and December 30, 2022, respectively

 

 

66,343

 

 

60,202

 

Contract assets

 

 

78,530

 

 

83,060

 

Other receivables

 

 

1,467

 

 

4,773

 

Prepaid expenses and other current assets

 

 

5,279

 

 

6,454

 

Total current assets

 

 

164,506

 

 

173,974

 

Equipment and leasehold improvements, net

 

 

26,160

 

 

22,537

 

Goodwill

 

 

131,144

 

 

130,124

 

Right-of-use assets

 

 

12,695

 

 

12,390

 

Other intangible assets, net

 

 

34,155

 

 

41,486

 

Other assets

 

 

15,613

 

 

10,620

 

Deferred income taxes, net

 

 

17,347

 

 

18,543

 

Total assets

 

$

401,620

 

$

409,674

 

Liabilities and Stockholders’ Equity

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

 

$

32,755

 

$

28,833

 

Accrued liabilities

 

 

45,773

 

 

59,110

 

Contingent consideration payable

 

 

 

 

4,000

 

Contract liabilities

 

 

15,406

 

 

12,585

 

Notes payable

 

 

7,995

 

 

16,903

 

Finance lease obligations

 

 

1,166

 

 

1,113

 

Lease liability

 

 

4,729

 

 

4,625

 

Total current liabilities

 

 

107,824

 

 

127,169

 

Notes payable

 

 

91,386

 

 

90,544

 

Finance lease obligations, less current portion

 

 

1,249

 

 

1,601

 

Lease liability, less current portion

 

 

9,829

 

 

8,599

 

Other noncurrent liabilities

 

 

259

 

 

259

 

Total liabilities

 

 

210,547

 

 

228,172

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

Preferred stock, $0.01 par value, 10,000 shares authorized, no shares issued and outstanding

 

 

 

 

 

Common stock, $0.01 par value, 40,000 shares authorized; 13,647 and 13,296 shares issued and outstanding at September 29, 2023 and December 30, 2022, respectively

 

 

136

 

 

133

 

Additional paid-in capital

 

 

184,391

 

 

177,718

 

Accumulated other comprehensive loss

 

 

 

 

 

Retained earnings

 

 

6,546

 

 

3,651

 

Total stockholders’ equity

 

 

191,073

 

 

181,502

 

Total liabilities and stockholders’ equity

 

$

401,620

 

$

409,674

 

 

WILLDAN GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 29,

 

September 30,

 

September 29,

 

September 30,

 

 

2023

 

2022

 

2023

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

Contract revenue

 

$

132,738

 

 

$

121,399

 

 

$

354,418

 

 

$

315,882

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct costs of contract revenue (inclusive of directly related depreciation and amortization):

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and wages

 

 

21,856

 

 

 

21,420

 

 

 

63,568

 

 

 

61,514

 

Subcontractor services and other direct costs

 

 

67,454

 

 

 

62,457

 

 

 

165,508

 

 

 

153,896

 

Total direct costs of contract revenue

 

 

89,310

 

 

 

83,877

 

 

 

229,076

 

 

 

215,410

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and wages, payroll taxes and employee benefits

 

 

23,805

 

 

 

20,373

 

 

 

68,606

 

 

 

60,169

 

Facilities and facility related

 

 

2,303

 

 

 

2,228

 

 

 

7,200

 

 

 

6,999

 

Stock-based compensation

 

 

1,244

 

 

 

1,607

 

 

 

4,064

 

 

 

6,626

 

Depreciation and amortization

 

 

4,190

 

 

 

4,405

 

 

 

12,518

 

 

 

13,240

 

Other

 

 

8,049

 

 

 

9,664

 

 

 

22,629

 

 

 

25,099

 

Total general and administrative expenses

 

 

39,591

 

 

 

38,277

 

 

 

115,017

 

 

 

112,133

 

Income (Loss) from operations

 

 

3,837

 

 

 

(755

)

 

 

10,325

 

 

 

(11,661

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(2,437

)

 

 

(1,435

)

 

 

(7,110

)

 

 

(3,216

)

Other, net

 

 

879

 

 

 

740

 

 

 

1,392

 

 

 

1,266

 

Total other expense, net

 

 

(1,558

)

 

 

(695

)

 

 

(5,718

)

 

 

(1,950

)

Income (Loss) before income taxes

 

 

2,279

 

 

 

(1,450

)

 

 

4,607

 

 

 

(13,611

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax (benefit) expense

 

 

713

 

 

 

(1,526

)

 

 

1,712

 

 

 

(5,588

)

Net income (loss)

 

 

1,566

 

 

 

76

 

 

 

2,895

 

 

 

(8,023

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain (loss) on derivative contracts, net of tax

 

 

 

 

 

 

 

 

 

 

 

38

 

Comprehensive income (loss)

 

$

1,566

 

 

$

76

 

 

$

2,895

 

 

$

(7,985

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (Loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.12

 

 

$

0.01

 

 

$

0.22

 

 

$

(0.62

)

Diluted

 

$

0.11

 

 

$

0.01

 

 

$

0.21

 

 

$

(0.62

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

13,462

 

 

 

13,110

 

 

 

13,357

 

 

 

12,971

 

Diluted

 

 

13,709

 

 

 

13,360

 

 

 

13,563

 

 

 

12,971

 

 

WILLDAN GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

 

September 29,

 

September 30,

 

 

2023

 

 

2022

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income (loss)

 

$

2,895

 

 

$

(8,023

)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

12,518

 

 

 

13,240

 

Deferred income taxes, net

 

 

1,196

 

 

 

(4,111

)

(Gain) loss on sale/disposal of equipment

 

 

(63

)

 

 

(67

)

Provision for doubtful accounts

 

 

194

 

 

 

230

 

Stock-based compensation

 

 

4,064

 

 

 

6,626

 

Accretion and fair value adjustments of contingent consideration

 

 

 

 

 

1,659

 

Changes in operating assets and liabilities, net of effects from business acquisitions:

 

 

 

 

 

 

Accounts receivable

 

 

(6,335

)

 

 

6,605

 

Contract assets

 

 

4,530

 

 

 

(15,636

)

Other receivables

 

 

3,306

 

 

 

1,155

 

Prepaid expenses and other current assets

 

 

1,686

 

 

 

256

 

Other assets

 

 

(4,993

)

 

 

1,981

 

Accounts payable

 

 

3,922

 

 

 

(13,185

)

Accrued liabilities

 

 

(2,658

)

 

 

15,354

 

Contract liabilities

 

 

2,821

 

 

 

(1,336

)

Right-of-use assets

 

 

1,029

 

 

 

(245

)

Net cash (used in) provided by operating activities

 

 

24,112

 

 

 

4,503

 

Cash flows from investing activities:

 

 

 

 

 

 

Purchase of equipment, software, and leasehold improvements

 

 

(7,583

)

 

 

(6,969

)

Proceeds from sale of equipment

 

 

68

 

 

 

75

 

Cash paid for acquisitions, net of cash acquired

 

 

(1,600

)

 

 

 

Net cash (used in) provided by investing activities

 

 

(9,115

)

 

 

(6,894

)

Cash flows from financing activities:

 

 

 

 

 

 

Payments on contingent consideration

 

 

(4,000

)

 

 

(10,206

)

Payment on restricted cash

 

 

(10,679

)

 

 

 

Payments on notes payable

 

 

(1,463

)

 

 

(1,577

)

Payments on debt issuance costs

 

 

(1,114

)

 

 

 

Borrowings under term loan facility and line of credit

 

 

105,000

 

 

 

20,000

 

Repayments under term loan facility and line of credit

 

 

(111,000

)

 

 

(9,750

)

Principal payments on finance leases

 

 

(951

)

 

 

(827

)

Proceeds from stock option exercise

 

 

38

 

 

 

270

 

Proceeds from sales of common stock under employee stock purchase plan

 

 

2,779

 

 

 

3,036

 

Cash used to pay taxes on stock grants

 

 

(205

)

 

 

(958

)

Net cash (used in) provided by financing activities

 

 

(21,595

)

 

 

(12

)

Net increase (decrease) in cash, cash equivalents and restricted cash

 

 

(6,598

)

 

 

(2,403

)

Cash, cash equivalents and restricted cash at beginning of period

 

 

19,485

 

 

 

11,221

 

Cash, cash equivalents and restricted cash at end of period

 

$

12,887

 

 

$

8,818

 

Supplemental disclosures of cash flow information:

 

 

 

 

 

 

Cash paid (received) during the period for:

 

 

 

 

 

 

Interest

 

$

8,025

 

 

$

2,790

 

Income taxes

 

 

(3,154

)

 

 

(903

)

Supplemental disclosures of noncash investing and financing activities:

 

 

 

 

 

 

Equipment acquired under finance leases

 

 

652

 

 

 

2,137

 

 

Willdan Group, Inc. and Subsidiaries

Reconciliation of GAAP Revenue to Net Revenue

(in thousands)

(Non-GAAP Measure)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 29,

 

September 30,

 

September 29,

 

September 30,

 

 

2023

 

2022

 

2023

 

2022

Consolidated

 

 

 

 

 

 

 

 

Contract revenue

 

$

132,738

 

$

121,399

 

$

354,418

 

$

315,882

Subcontractor services and other direct costs

 

 

67,454

 

 

62,457

 

 

165,508

 

 

153,896

Net Revenue

 

$

65,284

 

$

58,942

 

$

188,910

 

$

161,986

 

 

 

 

 

 

 

 

 

 

 

 

 

Energy segment

 

 

 

 

 

 

 

 

 

 

 

 

Contract revenue

 

$

111,030

 

$

102,625

 

$

292,330

 

$

262,186

Subcontractor services and other direct costs

 

 

66,377

 

 

61,557

 

 

162,557

 

 

151,445

Net Revenue

 

$

44,653

 

$

41,068

 

$

129,773

 

$

110,741

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineering and Consulting segment

 

 

 

 

 

 

 

 

 

 

 

 

Contract revenue

 

$

21,708

 

$

18,774

 

$

62,088

 

$

53,696

Subcontractor services and other direct costs

 

 

1,077

 

 

900

 

 

2,951

 

 

2,451

Net Revenue

 

$

20,631

 

$

17,874

 

$

59,137

 

$

51,245

 

Willdan Group, Inc. and Subsidiaries

Reconciliation of GAAP Net Income to Adjusted EBITDA

(in thousands)

(Non-GAAP Measure)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 29,

 

September 30,

 

September 29,

 

September 30,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss)

 

$

1,566

 

 

$

76

 

 

$

2,895

 

 

$

(8,023

)

Interest expense

 

 

2,437

 

 

 

1,435

 

 

 

7,110

 

 

 

3,216

 

Income tax expense (benefit)

 

 

713

 

 

 

(1,526

)

 

 

1,712

 

 

 

(5,588

)

Stock-based compensation

 

 

1,244

 

 

 

1,607

 

 

 

4,064

 

 

 

6,626

 

Interest accretion(1)

 

 

 

 

 

1,548

 

 

 

 

 

 

1,659

 

Depreciation and amortization

 

 

4,190

 

 

 

4,405

 

 

 

12,518

 

 

 

13,240

 

(Gain) Loss on sale of equipment

 

 

(13

)

 

 

2

 

 

 

(63

)

 

 

(67

)

Tax benefit distribution

 

 

 

 

 

434

 

 

 

 

 

 

434

 

Adjusted EBITDA

 

$

10,137

 

 

$

7,981

 

 

$

28,236

 

 

$

11,497

 

_______________
(1)

Interest accretion represents the imputed interest and fair value adjustments to estimated contingent consideration.

 

Willdan Group, Inc. and Subsidiaries

Reconciliation of GAAP Net Income to Adjusted Net Income and Adjusted Diluted EPS

(in thousands, except per share amounts)

(Non-GAAP Measure)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 29,

 

September 30,

 

September 29,

 

September 30,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss)

 

$

1,566

 

 

$

76

 

 

$

2,895

 

 

$

(8,023

)

Adjustment for stock-based compensation

 

 

1,244

 

 

 

1,607

 

 

 

4,064

 

 

 

6,626

 

Tax effect of stock-based compensation

 

 

(252

)

 

 

(238

)

 

 

(823

)

 

 

(981

)

Adjustment for intangible amortization

 

 

2,662

 

 

 

2,841

 

 

 

7,910

 

 

 

8,531

 

Tax effect of intangible amortization

 

 

(539

)

 

 

(421

)

 

 

(1,601

)

 

 

(1,263

)

Adjustment for interest accretion

 

 

 

 

 

1,548

 

 

 

 

 

 

1,659

 

Tax effect of interest accretion

 

 

 

 

 

(229

)

 

 

 

 

 

(246

)

Adjustment for refinancing costs

 

 

467

 

 

 

 

 

 

467

 

 

 

 

Tax effect of refinancing costs

 

 

(95

)

 

 

 

 

 

(95

)

 

 

 

Adjustment for tax benefit distribution

 

 

 

 

 

434

 

 

 

 

 

 

434

 

Tax effect of tax benefit distribution

 

 

 

 

 

(64

)

 

 

 

 

 

(64

)

Adjusted Net Income (Loss)

 

$

5,053

 

 

$

5,554

 

 

$

12,817

 

 

$

6,673

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted weighted-average shares outstanding

 

 

13,709

 

 

 

13,360

 

 

 

13,563

 

 

 

12,971

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings (loss) per share

 

$

0.11

 

 

$

0.01

 

 

$

0.21

 

 

$

(0.62

)

Impact of adjustment:

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation per share

 

 

0.09

 

 

 

0.12

 

 

 

0.30

 

 

 

0.51

 

Tax effect of stock-based compensation per share

 

 

(0.02

)

 

 

(0.02

)

 

 

(0.06

)

 

 

(0.08

)

Intangible amortization per share

 

 

0.19

 

 

 

0.21

 

 

 

0.58

 

 

 

0.66

 

Tax effect of intangible amortization per share

 

 

(0.03

)

 

 

(0.03

)

 

 

(0.11

)

 

 

(0.10

)

Interest accretion per share

 

 

 

 

 

0.12

 

 

 

 

 

 

0.13

 

Tax effect of interest accretion per share

 

 

 

 

 

(0.02

)

 

 

 

 

 

(0.02

)

Refinancing costs per share

 

 

0.03

 

 

 

 

 

 

0.03

 

 

 

 

Tax effect of refinancing cost per share

 

 

 

 

 

 

 

 

 

 

 

 

Tax benefit distribution per share

 

 

 

 

 

0.03

 

 

 

 

 

 

0.03

 

Tax effect of tax benefit distribution per share

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Diluted EPS

 

$

0.37

 

 

$

0.42

 

 

$

0.95

 

 

$

0.51

 

 

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