BG Staffing (NYSE: BGSF) reported Q1 EPS of $0.28, $0.05 better than the analyst estimate of $0.23. Revenue for the quarter came in at $74.07 million versus the consensus estimate of $73.42 million.

Beth A. Garvey, President and CEO, stated, “Our results through the first half of March were in line with expectations. We began seeing an impact from COVID-19 mid-March and reacted swiftly with our top priority of minimizing risk to our team members and lowering the probability of spread of the virus to our families and communities. We immediately activated a COVID-19 Task Force Team who continue to act quickly and efficiently with communication to the team on the changes and our responses in the business.

“We were able to leverage our technology platforms, many of which were part of our recent tech upgrades over the past 12 months, to successfully transition (where possible) to work-from-home or working onsite within the new guidelines for social distancing and safety protocols issued by the CDC. In addition, our team has worked in strong partnership with our client partners to establish protocols for remote work, as well as safety guidelines for the those that have been deemed essential.

“I am grateful and proud of our team, as our response has definitely been a team effort as we have pivoted to operate in the evolving new normal. We remain vigilant and responsive as we navigate through the challenges of these unprecedented times,” Garvey concluded.

Dan Hollenbach, Chief Financial Officer, said, “We have made significant efforts to adjust our operations in response to COVID-19 in all of the segment and home office operations. The extent of the impact from the outbreak on our operational and financial performance moving forward will depend on certain developments, including the duration and spread of the outbreak, its impact on the Company's client partners and the range of governmental and community reactions to the pandemic (including phased reopenings). These events are uncertain and cannot be fully predicted at this time.

“Net income for the first quarter 2020 was affected by transaction fees and IT roadmap expenses (which were $979,000 greater than 2019), as well as an effective tax rate of 31.9% in 2020 vs. 22.8% for 2019,” Hollenbach continued.

“The Company has also recently taken several steps to strengthen its liquidity. We borrowed $4 million on our term loan to reduce our revolver balance, elected to defer the employer portion of FICA for the remainder of the year, and our Board of Directors temporarily reduced our regular quarterly cash dividend to $0.05 from $0.30 per share. While returning capital to shareholders remains an important part of our capital allocation framework, maintaining a strong balance sheet is primary,” concluded Hollenbach.

For earnings history and earnings-related data on BG Staffing (BGSF) click here.