Hudson Global, Inc.

Good morning and welcome to the Hudson Global Conference Call for the third quarter of 2022. 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 forward-looking statements under applicable securities laws. Such forward-looking statements involve certain risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statement. 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 forward-looking 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 of these measures are included in our earnings relief 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 helpful reference guide during our call. I will now turn this call over to Jeff Everwine.

Thank you, Operator, and welcome, everyone. We thank you for your interest in Hudson Global and for joining us today. I'll start by reviewing the third quarter 2022 highlights, and Matt Diamond, our CFO, will provide some additional details on our financial results. I'll then give an update on current business conditions. For the third quarter of 2022, we reported revenue of $49 million, up 16% year-over-year in constant currencies. Adjusted net revenue was $24.2 million and increased 42% year-over-year in constant currency. SG&A costs were $21.2 million in the third quarter of 49% versus the same period last year in constant currency. We reported adjusted EBITDA of $3 million of 8% in constant currency versus a year ago. In addition, we reported net income of $1 million or $0.30 a share versus net income of $1.5 million, or $0.49 per share, in the same period last year. Also, we reported adjusted net income per diluted share of $0.58 in the third quarter versus $0.78 a year ago. In the third quarter of 2022, we repurchased approximately $1.1 million of stock. Since the beginning of 2019, we've reduced the company share count by 13%, And we continue to view share repurchases as an attractive use of capital. We have 600,000 remaining under our 10 million common share repurchase program. And I'll 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 third quarter.

Thank you, Jeff. And good morning, everyone. Our America's business grew revenue and adjusted net revenue 69% and 70% in constant currency, respectively. Adjusted EBITDA of 1.8 million increased versus last year's adjusted EBITDA of 1.4 million. Revenue for our Asia-Pacific business was roughly flat year-over-year in constant currency, and adjusted net revenue grew 12% in constant currency. Adjusted EBITDA of 1.7 million decreased from adjusted EBITDA of 2.2 million a year ago. Our EMEA business grew revenue 36% and adjusted net revenue 51% in constant currency. Adjusted EBITDA of 0.4 million in Q3 2022 increased compared to adjusted EBITDA of 0.2 million in Q3 of last year. Turning to some additional financial details from the third quarter. We ended Q3 with $22.7 million in cash and restricted cash. Day sales outstanding was 50 days at September 2022, up from DSO of 39 days in September 2021. In connection with the acquisition 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 September 30, 2022 reflects $4.9 million of goodwill and $4.8 million of net amortizable intangible assets. The company's working capital, excluding cash, increased to $10.2 million in the third quarter of 2022 from $7.8 million at the end of 2021. As a reminder, in April 2019, we finalized a credit facility in Australia to support the expected growth in working capital needs as a result of new client wins in that market. But we had nothing drawn on this facility at the end of Q3. The company used $0.1 million in cash flow from operations during the third 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.