Last10K.com

Mastech Digital, Inc. (MHH) SEC Filing 8-K Material Event for the period ending Wednesday, April 27, 2022

Mastech Digital, Inc.

CIK: 1437226 Ticker: MHH

Exhibit 99.1

 

LOGO

FOR IMMEDIATE RELEASE:

Mastech Digital Reports 20% Increase in Revenues in the First Quarter 2022

Both the Data & Analytics and IT Staffing Segments Achieved Double-Digit YOY Revenue Growth

PITTSBURGH, PA – April 27, 2022 -

Mastech Digital, Inc. (NYSE American: MHH), a leading provider of Digital Transformation IT Services, announced today its financial results for the first quarter ending March 31, 2022.

First Quarter 2022 Highlights:

 

   

The Company delivered record consolidated revenues in the first quarter of 2022. Total revenues grew organically by 20% to $59.8 million, compared to revenues of $49.8 million in the 2021 first quarter;

 

   

The Company’s Data and Analytics Services segment reported revenues of $10.2 million, an organic increase of 15% over last year’s $8.8 million;

 

   

The IT Staffing segment achieved record revenues of $49.6 million and record gross margins of 22.9% during the first quarter 2022. Top-line organic growth totaled 21% compared to the first quarter of 2021;

 

   

GAAP diluted earnings per share was $0.19 in the first quarter of 2022 compared to $0.10 in the first quarter of 2021; and

 

   

Non-GAAP diluted earnings per share was $0.28 in the first quarter of 2022 compared to $0.19 in the 2021 first quarter.

First Quarter 2022 Results:

Revenues for the first quarter of 2022 totaled $59.8 million compared to $49.8 million during the corresponding quarter of 2021. Gross profits in the first quarter of 2022 increased by 24% to $15.9 million from $12.8 million in the same quarter of 2021. GAAP net income for the first quarter of 2022 totaled $2.3 million or $0.19 per diluted share, compared to $1.2 million or $0.10 per diluted share during the same period of 2021. Non-GAAP net income for the first quarter of 2022 was $3.3 million or $0.28 per diluted share, compared to $2.2 million or $0.19 per diluted share in the first quarter of 2021.

Activity levels at the Company’s Data and Analytics Services segment were solid, with order bookings of $11.8 million. Additionally, backlog increased during the quarter. Demand for the Company’s IT Staffing Services segment remained elevated during the first quarter, as the segment achieved record revenues and gross margins.

“2022 is off to a strong start with solid financial results in a quarter that has historically been weak”, said Vivek Gupta, the Company’s President and Chief Executive Officer. “Both of our business segments had sequential revenue growth, strong year-over-year top-line growth and solid operating profits. Additionally, we brought onboard Ganeshan Venkateshwaran, a seasoned leader with an impressive track record of successes in the digital transformation services space, as the Chief Executive Officer of our Data and Analytics Services segment. Ganeshan joins us with a wealth of knowledge around advanced technologies and digital transformation services to lead the next phase of growth for Mastech InfoTellis.”

About Mastech Digital, Inc.:

Mastech Digital (NYSE American: MHH) is a leading provider of Digital Transformation IT Services. The Company offers Data Management and Analytics Solutions, Digital Learning, and IT Staffing Services with a Digital First approach. A minority-owned enterprise, Mastech Digital is headquartered in Pittsburgh, PA with offices across the U.S., Canada, EMEA, India and ASEAN.


LOGO

Use of Non-GAAP Measures:

This press release contains non-GAAP financial measures to supplement our financial results presented on a GAAP basis. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. Reconciliations of these non-GAAP measures to their comparable GAAP measures are included in the attached financial tables.

We believe that providing non-GAAP net income and non-GAAP diluted earnings per share offers investors useful supplemental information about the financial performance of our business, enables comparison of financial results between periods where certain items may vary independent of business performance, and allows for greater transparency with respect to key metrics used by management in operating our business. Additionally, management uses these non-GAAP financial measures in evaluating the Company’s performance.

Specifically, the non-GAAP financial measures contained herein exclude the following expense items:

Amortization of acquired intangible assets: We amortize intangible assets acquired in connection with our June 2015 acquisition of Hudson IT, our July 2017 acquisition of the services division of InfoTrellis, Inc. and our October 2020 acquisition of AmberLeaf Partners. We exclude these amortization expenses in our non-GAAP financial measures because we believe it allows investors to make more meaningful comparisons between our operating results and those of other companies within our industry and facilitates a helpful comparison of our results with other periods.

Stock-based compensation expenses: We incur material recurring expense related to non-cash, stock-based compensation. We exclude these expenses in our non-GAAP financial measures because we believe that it provides investors with meaningful supplemental information regarding operational performance. In particular, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use under ASC 718, we believe that providing non-GAAP financial measures that exclude these expenses allows investors to make more meaningful comparisons between our operating results and those of other companies within our industry and facilitates comparison of our results with other periods.

Forward-Looking Statements:

Certain statements contained in this release are forward-looking statements based on management’s expectations, estimates, projections and assumptions. Words such as “expects,” “anticipates,” “plans,” “believes,” “scheduled,” “estimates” and variations of these words and similar expressions are intended to identify forward-looking statements, which include but are not limited to projections of and statements regarding the Company’s ability to generate revenues, earnings, and cash flow. These statements are based on information currently available to the Company and it assumes no obligation to update the forward-looking statements as circumstances change. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results and trends may differ materially from what is forecasted in forward-looking statements due to a variety of factors, including, without limitation, the level of market demand for the Company’s services, the highly competitive market for the types of services offered by the Company, the impact of competitive factors on profit margins, market conditions that could cause the Company’s customers to reduce their spending for its services, the Company’s ability to create, acquire and build new lines of business, to attract and retain qualified personnel, reduce costs and conserve cash, the extent to which the Company’s business is adversely affected by the impacts of the COVID-19 pandemic and governmental responses to limit the further spread of COVID-19 and other risks that are described in more detail in the Company’s filings with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2021.

# # #


LOGO

For more information, contact:

Donna Kijowski

Manager, Investor Relations

Mastech Digital, Inc.

888.330.5497


MASTECH DIGITAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

(Unaudited)

 

     March 31,
2022
    December 31,
2021
 
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 7,185     $ 6,622  

Accounts receivable, net

     46,838       43,393  

Prepaid and other current assets

     3,191       3,890  
  

 

 

   

 

 

 

Total current assets

     57,214       53,905  

Equipment, enterprise software and leasehold improvements, net

     3,540       3,038  

Operating lease right-of-use assets

     5,033       4,894  

Non-current deposits

     511       595  

Goodwill, net of impairment

     32,510       32,510  

Intangible assets, net of amortization

     17,968       18,760  
  

 

 

   

 

 

 

Total assets

   $ 116,776     $ 113,702  
  

 

 

   

 

 

 
LIABILITIES AND SHAREHOLDERS’ EQUITY     

Current liabilities:

    

Current portion of long-term debt

   $ 4,400     $ 4,400  

Current portion of operating lease liability

     1,571       1,479  

Accounts payable

     6,242       4,954  

Accrued payroll and related costs

     13,367       14,240  

Other accrued liabilities

     1,222       1,771  
  

 

 

   

 

 

 

Total current liabilities

     26,802       26,844  

Long-term liabilities:

    

Long-term debt, less current portion, net

     7,252       8,334  

Long-term operating lease liability, less current portion

     3,677       3,706  

Long-term accrued income taxes

     125       125  

Deferred income taxes

     888       265  
  

 

 

   

 

 

 

Total liabilities

     38,744       39,274  

Shareholders’ equity:

    

Common stock, par value $0.01 per share

     133       131  

Additional paid-in capital

     29,667       28,250  

Retained earnings

     53,173       50,841  

Accumulated other comprehensive income (loss)

     (754     (607

Treasury stock, at cost

     (4,187     (4,187
  

 

 

   

 

 

 

Total shareholders’ equity

     78,032       74,428  
  

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 116,776     $ 113,702  
  

 

 

   

 

 

 


MASTECH DIGITAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share data)

(Unaudited)

 

     Three Months ended March 31,  
     2022     2021  

Revenues

   $ 59,755     $ 49,775  

Cost of revenues

     43,823       36,971  
  

 

 

   

 

 

 

Gross profit

     15,932       12,804  

Selling, general and administrative expenses

     12,625       10,935  
  

 

 

   

 

 

 

Income from operations

     3,307       1,869  

Other income/(expense), net

     (60     (232
  

 

 

   

 

 

 

Income before income taxes

     3,247       1,637  

Income tax expense

     915       443  
  

 

 

   

 

 

 

Net income

   $ 2,332     $ 1,194  
  

 

 

   

 

 

 

Earnings per share:

    

Basic

   $ 0.20     $ 0.10  

Diluted

   $ 0.19     $ 0.10  

Weighted average common shares outstanding:

    

Basic

     11,509       11,415  
  

 

 

   

 

 

 

Diluted

     12,035       11,997  
  

 

 

   

 

 

 


MASTECH DIGITAL, INC.

RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES

(Amounts in thousands, except per share data)

(Unaudited)

 

     Three Months ended March 31,  
     2022      2021  

GAAP Net Income

   $ 2,332      $ 1,194  

Adjustments:

     

Amortization of acquired intangible assets

     792        793  

Stock-based compensation

     526        621  

Income taxes adjustments

     (340      (365
  

 

 

    

 

 

 

Non-GAAP Net Income

   $ 3,310      $ 2,243  
  

 

 

    

 

 

 

GAAP Diluted Earnings Per Share

   $ 0.19      $ 0.10  
  

 

 

    

 

 

 

Non-GAAP Diluted Earnings Per Share

   $ 0.28      $ 0.19  
  

 

 

    

 

 

 

Weighted average common shares outstanding:

     

GAAP Diluted Shares

     12,035        11,997  
  

 

 

    

 

 

 

Non-GAAP Diluted Shares

     12,035        11,997  
  

 

 

    

 

 

 


MASTECH DIGITAL, INC.

SUPPLEMENTAL FINANCIAL INFORMATION

(Amounts in thousands)

(Unaudited)

 

     Three Months ended March 31,  
     2022     2021  

Revenues:

    

Data and analytics services

   $ 10,152     $ 8,794  

IT staffing services

     49,603       40,981  
  

 

 

   

 

 

 

Total revenues

   $ 59,755     $ 49,775  
  

 

 

   

 

 

 

Gross Margin %:

    

Data and analytics services

     45.2     45.7

IT staffing services

     22.9     21.4
  

 

 

   

 

 

 

Total gross margin %

     26.7     25.7
  

 

 

   

 

 

 

Segment Operating Income:

    

Data and analytics services

   $ 972     $ 394  

IT staffing services

     3,127       2,268  
  

 

 

   

 

 

 

Subtotal

     4,099       2,662  

Amortization of acquired intangible assets

     (792     (793

Interest expense and other, net

     (60     (232
  

 

 

   

 

 

 

Income before income taxes

   $ 3,247     $ 1,637  
  

 

 

   

 

 

 

View differences made from one to another to evaluate Mastech Digital, Inc.'s financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 8-K Corporate News to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Mastech Digital, Inc..

Continue

Assess how Mastech Digital, Inc.'s management team is paid from their Annual Proxy

Definitive Proxy Statement (Form DEF 14A)
Screenshot example of actual Proxy Statement

Mastech Digital, Inc.'s Definitive Proxy Statement (Form DEF 14A) filed after their 2022 10-K Annual Report includes:

  • Voting Procedures
  • Board Members
  • Executive Team
  • Salaries, Bonuses, Perks
  • Peers / Competitors

Continue

SEC Filing Tools

Financial Statements, Disclosures and Schedules

Inside this 8-K Corporate News

Material Contracts, Statements, Certifications & more

Mastech Digital, Inc. provided additional information to their SEC Filing as exhibits

Ticker: MHH
CIK: 1437226
Form Type: 8-K Corporate News
Accession Number: 0001193125-22-121765
Submitted to the SEC: Wed Apr 27 2022 8:30:56 AM EST
Accepted by the SEC: Wed Apr 27 2022
Period: Wednesday, April 27, 2022
Industry: Management Consulting Services
Events:
  1. Earnings Release
  2. Financial Exhibit

External Resources:
Stock Quote
Social Media

Bookmark the Permalink:
https://last10k.com/sec-filings/mhh/0001193125-22-121765.htm