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Resources Connection Inc (RECN) SEC Filing 10-K Annual report for the fiscal year ending Saturday, May 28, 2016

Resources Connection Inc

CIK: 1084765 Ticker: RECN

Exhibit 99.1

Resources Connection, Inc. Reports Fourth Quarter and Year-End Results for Fiscal 2016

  • Company reports quarter-over-quarter revenue increase of 2.5% to $152.5 million; increase for year of 1.3% to $598.5 million
  • Earnings per share improve 9.5% to $0.23 for quarter; up 12.5% for year to $0.81
  • Adjusted EBITDA* increases 6.2% to $17.8 million for quarter (11.7% of revenue); up 5.1% to $63.6 million for fiscal year (10.6% of revenue)
  • Company returns capital to shareholders of $11.8 million in fourth quarter and $42.2 million in fiscal 2016

*Adjusted EBITDA is defined as earnings before interest, income taxes, depreciation, amortization and stock-based compensation

IRVINE, Calif.--(BUSINESS WIRE)--July 14, 2016--Resources Connection, Inc. (NASDAQ: RECN) today announced financial results for its fourth fiscal quarter and year ended May 28, 2016. Resources Connection, Inc. (the “Company”) is a multinational professional services firm that provides – through its operating subsidiary, Resources Global Professionals (“RGP”) – consulting and business support services to clients in the areas of accounting; finance; corporate governance, risk and compliance; corporate advisory, strategic communications and restructuring; information management; human capital; supply chain management; and legal and regulatory.

Revenue for the fourth quarter of fiscal 2016 increased 2.5% (2.6% constant currency) to $152.5 million compared to the prior year’s fourth quarter of $148.8 million. Approximately 0.9% of the quarter-over-quarter revenue increase is attributable to the shift of the Memorial Day holiday to the first quarter of fiscal 2017. On a sequential basis, fourth quarter revenue increased 3.9% (3.4% constant currency) compared to $146.8 million in the third quarter of fiscal 2016, which includes the winter holiday season. (Constant currency quarter-over-quarter is computed using the comparable fourth quarter fiscal 2015 conversion rates and sequential quarter is computed using the comparable third quarter fiscal 2016 conversion rates for revenue generated internationally.)

Revenue in the U.S. increased 3.1% quarter-over-quarter and 2.8% sequentially. International revenue was flat quarter-over-quarter (and on a constant currency basis) but increased 9.2% sequentially (6.4% constant currency).

The Company’s net income improved in the fourth quarter of fiscal 2016 to $8.7 million, or $0.23 per diluted share, compared to $8.1 million, or $0.21 per diluted share, in the prior year’s fourth quarter.

“Overall, I am pleased with our fiscal 2016 financial results,” said Tony Cherbak, president and chief executive officer of RGP. “On a constant currency basis, revenue improved 2.9%, gross margin increased to 38.8% and we saw double digit gains in net earnings and earnings per share. While the uncertainty over Brexit will play out during fiscal 2017 and beyond, we will continue to pursue growth opportunities in areas such as implementation of revenue recognition and lease accounting standards, M&A integration and Data Solutions, among others.”

Gross margin was 39.9% in the fourth quarter of fiscal 2016, compared to 38.9% in the prior year quarter. Gross margin in the current quarter improved due to the shift in the paid Memorial Day holiday to the first quarter of fiscal 2017 and decreased health care costs. Sequentially, gross margin improved 250 basis points from 37.4% in the third quarter of fiscal 2016, due primarily to fewer holidays in the U.S. during the fourth quarter and the reduced impact of employer payroll taxes.

Selling, general and administrative expenses for the fourth quarter of fiscal 2016 were $44.4 million (29.1% of revenue) compared to $42.5 million (28.5% of revenue) in the prior year’s fourth quarter and $43.3 million (29.5% of revenue) in the third quarter of fiscal 2016. The quarter-over-quarter increase is primarily from higher marketing and compensation/benefit costs, while the sequential increase is primarily due to higher marketing expenses.


The following information was filed by Resources Connection Inc (RECN) on Thursday, July 14, 2016 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Resources Connection Inc's 10-K Annual Report:

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Document And Entity Information
Consolidated Balance Sheets
Consolidated Balance Sheets (parenthetical)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Comprehensive Income
Consolidated Statements Of Operations
Consolidated Statements Of Stockholders' Equity
Consolidated Statements Of Stockholders' Equity (parenthetical)
Accrued Salaries And Related Obligations
Accrued Salaries And Related Obligations (schedule Of Accrued Salaries And Related Obligations) (details)
Accrued Salaries And Related Obligations (tables)
Benefit Plan
Benefit Plan (details)
Commitments And Contingencies
Commitments And Contingencies (narrative) (details)
Commitments And Contingencies (schedule Of Lease Commitments And Purchase Obligations) (details)
Commitments And Contingencies (tables)
Concentrations Of Credit Risk
Concentrations Of Credit Risk (details)
Description Of The Company And Its Business
Income Taxes
Income Taxes (narrative) (details)
Income Taxes (schedule Of Current And Deferred Income Tax Provision For Federal And State Income Taxes Attributable To Operations) (details)
Income Taxes (schedule Of Effective Income Tax Rate Reconciliation) (details)
Income Taxes (schedule Of Income Before Provision For Income Taxes) (details)
Income Taxes (schedule Of The Components Of Net Deferred Tax Asset) (details)
Income Taxes (summary Of Activity In Valuation Allowance) (details)
Income Taxes (summary Of Net Operating Loss Expiration Periods) (details)
Income Taxes (summary Of The Activity Related To Gross Unrecognized Tax Benefits) (details)
Income Taxes (tables)
Intangible Assets And Goodwill
Intangible Assets And Goodwill (schedule Of Details Of Intangible Assets) (details)
Intangible Assets And Goodwill (schedule Of Intangible Assets Related Accumulated Amortization) (details)
Intangible Assets And Goodwill (summary Of Activity In Goodwill Balance) (details)
Intangible Assets And Goodwill (tables)
Property And Equipment
Property And Equipment (schedule Of Property And Equipment) (details)
Property And Equipment (tables)
Revolving Credit Agreement
Revolving Credit Agreement (details)
Segment Information And Enterprise Reporting
Segment Information And Enterprise Reporting (narrative) (details)
Segment Information And Enterprise Reporting (schedule Of Revenue From External Customers And Long-lived Assets, By Geographical Areas) (details)
Segment Information And Enterprise Reporting (tables)
Stock Based Compensation Plans (summary Of Impact Of Stock-based Compensation Plans) (details)
Stock-based Compensation Plans
Stock-based Compensation Plans (narrative) (details)
Stock-based Compensation Plans (schedule Of Share-based Payment Award, Valuation Assumptions) (details)
Stock-based Compensation Plans (schedule Of Stock Option Activity) (details)
Stock-based Compensation Plans (tables)
Stockholders' Equity
Stockholders' Equity (details)
Summary Of Significant Accounting Policies
Summary Of Significant Accounting Policies (calculation Of Net Income Per Share) (details)
Summary Of Significant Accounting Policies (components Of Short-term Investments) (details)
Summary Of Significant Accounting Policies (narrative) (details)
Summary Of Significant Accounting Policies (policy)
Summary Of Significant Accounting Policies (schedule Of Estimated Useful Lives Of Property And Equipment) (details)
Summary Of Significant Accounting Policies (summary Of The Activity In Allowance For Doubtful Accounts) (details)
Summary Of Significant Accounting Policies (tables)
Supplemental Disclosure Of Cash Flow Information
Supplemental Disclosure Of Cash Flow Information (schedule Of Additional Information Regarding Cash Flows) (details)
Supplemental Disclosure Of Cash Flow Information (tables)
Ticker: RECN
CIK: 1084765
Form Type: 10-K Annual Report
Accession Number: 0001193125-16-678405
Submitted to the SEC: Wed Aug 10 2016 8:37:04 PM EST
Accepted by the SEC: Thu Aug 11 2016
Period: Saturday, May 28, 2016
Industry: Business Services

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