HireQuest (NASDAQ: HQI) reported Q3 EPS of ($0.65), versus $0.11 reported last year.

“Operationally, the third quarter was a milestone period for us, as we completed the merger between Command Center and Hire Quest, converted 100% of our corporate-owned branches to franchises and completed the sale of our California locations,” commented Rick Hermanns, HireQuest’s President and Chief Executive Officer. “As expected, we incurred approximately $4.8 million in expenses related to the merger, restructuring, rebranding, and related efforts. We anticipate more charges in the fourth quarter 2019 and the first quarter 2020 related to the merger and integration efforts, however, the charges will be significantly lower than those experienced in the third quarter. We remain poised to enter 2020 with the capacity to grow through the expansion of national accounts, organic growth and, potentially acquisitions.”

“As we continue to eliminate redundancy, including the consolidation of our headquarters to a single facility post-merger, we are positioned to improve our profit margins,” continued Mr. Hermanns. “By the end of November, we expect to be at our target for headcount. There are some legacy issues including leases and contractual obligations which we cannot eliminate immediately, but all targeted costs we have the ability to cut should be eliminated during the first quarter of 2020. In 2020 we will focus on achieving organic growth through incentives for high-performing franchisees to help them expand into adjacent markets, securing additional national accounts and potential acquisition if we find an excellent opportunity.”

Third Quarter 2019 Financial Summary

• Franchise royalties increased 44.3% to $3.1 million compared to quarter ended September 30, 2018.
• Services revenue, which includes interest paid on aging accounts, increased 45.3% to $241,000 over same period last year.
• Total revenue increased 44.3% to $3.4 million compared to $2.3 million in the year-ago period.
• Net loss from continuing operations was $8.5 million, or $(0.65) per diluted share, compared to net income from continuing operations of $1.1 million, or $0.11 per diluted share, in the year-ago period.
• The net loss from continuing operations included approximately $4.8 million in expenses related to the merger.

For earnings history and earnings-related data on HireQuest (HQI) click here.