Hudson Technologies, Inc.

Good morning and welcome to the Hudson Global Conference Call for the second quarter of 2023. Our call today will be led by Chief Executive Officer Jeff Eberwine and Chief Financial Officer Matt Diamond. Please be advised that the statements made during the presentation include foreign looking statements under applicable security laws. Such foreign looking statements involve certain risks and uncertainties that may cause actual results to differ materially from those contained in the forelooking statements. These risks are discussed in our Form 8-K filed today and in our other filings made with the Securities and Exchange Commission, including our annual report on Form 10-K. The company disclaims any obligation to update any forelooking statements. During the course of this conference call, references will be made to non-GAAP terms such as constant currency adjusted EBITDA and adjusted earnings per diluted share. Reconciliations for these measures are included in our earnings release and quarterly slides, both posted on our website, hudsonrpo.com. I encourage you to access our earnings materials at this time, as they will serve as a helpful reference guide during our call. I will now turn the call over to Jeff Eberwine.

Thank you, Operator, and welcome, everyone. We thank you for your interest in Hudson Global and for joining us today. We'll start by reviewing the second quarter 2023 highlights, and Matt Diamond, our CFO, will provide some additional details on our financial results. I will then give an update on current business conditions. For the second quarter of 2023, we reported revenue of $45 million, down 18% year-over-year in constant currency. Adjusted net revenue was $23 million and decreased 15% year-over-year in constant currency. SG&A costs were $20 million in the first quarter, down 5% versus the same period last year in constant currency. We reported adjusted EBITDA of $2.6 million, down 52% in constant currency versus a year ago. In addition, we reported net income of $600,000, or $0.18 per diluted share, versus net income of $3.1 million, or $0.98 per diluted share, in the same period last year. We reported adjusted net income per share of 36 cents in Q1, sorry, Q2 2023 versus $1.25 a year ago. I now turn the call over to Matt Diamond, our CFO, to review our financial results by region, as well as provide some additional financial details from the second quarter.

Thank you, Jeff, and good morning, everyone. Revenue and adjusted net revenue for our America's business decreased 40% in constant currency. Break-even adjusted EBITDA decreased versus last year's adjusted EBITDA of 3.4 million. Revenue for our Asia-Pacific business increased 1% year-over-year, and adjusted net revenue grew 11% in constant currency. Adjusted EBITDA of 2.5 million decreased from adjusted EBITDA of 2.6 million a year ago. but increased 2% in constant currency. Revenue for our EMEA business declined 34% in constant currency, while adjusted net revenue increased 10% in constant currency. Adjusted EBITDA of 1.1 million in the second quarter of 2023 increased from adjusted EBITDA of 0.8 million a year ago. Turning to some additional financial details from the second quarter, We ended Q2 with $23 million in cash and restricted cash. Day sales outstanding was 51 days at June 2023, down from DSO 53 days in March 2023. In connection with the acquisitions of Coit Group in the fourth quarter of 2020, Karani in the fourth quarter of 2021, and Hunt & Badge in the third quarter of 2022, our balance sheet as of June 30, 2023, reflects $4.9 million of goodwill $4.0 million of net amortizable intangible assets. The company also paid off its $1.3 million acquisition-related note in the second quarter. The company's working capital, excluding cash, increased significantly to $12.5 million in the second quarter of 2023 from $7.3 million at the end of 2022. The company generated $2.6 million in cash flow from operations during the second quarter. I'll now turn the call back over to Jeff to give some more perspective on our RPO business and to review current trends.