SAN ANTONIO, Texas, Nov. 08, 2017 (GLOBE NEWSWIRE) -- Harte Hanks (NYSE:HHS), a leader in developing customer relationships, experiences and interaction-led marketing, today announced financial results for its third quarter ended September 30, 2017.
Commenting on performance, President and Chief Executive Officer Karen Puckett said, “We are happy this quarter reflects better revenue and profit trends, driven by our focus on customer satisfaction and client retention. During the quarter, revenue was essentially flat sequentially and down 3.1% from the same period a year ago. I am pleased that our cost control efforts have enabled us to increase operating income by $5.0 million year-over-year, producing approximately $1.0 million in operating income for the third quarter.
Ms. Puckett continued, “Our strategy is unchanged. We continue to work to improve our financial results by focusing on expense reduction, customer satisfaction and client retention while attracting new clients with revamped marketing, sales and innovative capabilities.”
Third Quarter Results
Third quarter 2017 revenues were $94.4 million compared to $97.4 million during the same quarter last year, or a 3.1% decline. Operating income from continuing operations was approximately $1.0 million, a $5.0 million improvement compared to an operating loss from continuing operations of $4.1 million in the year-ago quarter.
Net loss from continuing operations for the third quarter of 2017 was $2.5 million or a net loss of $0.04 per share, an improvement of $1.8 million, or $0.03 per share, compared to the year-ago quarter.
Chief Financial Officer, Robert Munden said, “Although we have made gains in profitability, we expect our revenues in the coming quarters will be challenged by continued declines in our retail vertical. We will continue to benefit from the reduced cost base from actions effected in the last year, which will enhance our financial flexibility to effectively run the business.”
The following table presents financial highlights of the company's operations for the third quarter of 2017 and 2016, respectively. More detailed financial results are attached.
RESULTS FROM OPERATIONS
|(In thousands, except per share amounts)||Three Months Ended September 30,|
|Revenues from continuing operations||$ 94,424||$97,425||(3.1)|
|Operating Income (loss) |
from continuing operations
|Net loss from continuing operations||(2,480)||(4,285)||42.1|
|Loss per share||(0.04)||(0.07)||42.9|
|Weighted average common shares outstanding||62,012||61,543||0.1|
* Improvements shown as positive.
The company will host a conference call to discuss the earnings release today at 10:00 a.m. Eastern Time. To access an audio webcast, please use the link available in the Investors Events section of the Harte Hanks website.
The telephonic conference call number is (888)-312-9863 for domestic callers and +1 (719) 325-2408 for international callers. The conference ID is 2325196.
An audio replay will be available shortly after the call through Saturday, November 25, 2017 at (844)-512-2921, or +1 (412)-317-6671, with conference ID 2325196. The replay also will be available for one year in the Investors section of the Harte Hanks website.
|Harte Hanks, Inc.|
|Consolidated Statements of Operations (Unaudited)|
|Three Months Ended|
|Nine Months Ended|
|In thousands, except per share data||2017||2016||2017||2016|
|Production and distribution||26,726||27,275||80,125||84,581|
|Advertising, selling, general and administrative||9,145||11,586||30,431||35,162|
|Depreciation, software and intangible asset amortization||2,556||3,166||8,166||9,403|
|Total operating expenses||93,474||101,511||291,222||313,626|
|Operating income (loss)||950||(4,086||)||(7,182||)||(19,321||)|
|Other expenses (income)|
|Interest expense, net||1,285||704||3,543||2,399|
|Total other expenses||3,048||1,300||8,630||3,343|
|Income (loss) from continuing operations before income taxes||(2,098||)||(5,386||)||(15,812||)||(22,664||)|
|Income tax expense (benefit)||382||(1,101||)||(3,293||)||(5,778||)|
|Income (loss) from continuing operations||(2,480||)||(4,285||)||(12,519||)||(16,886||)|
|Income (loss) from discontinued operations, net of income taxes||-||1,244||-||3,980|
|Net income (loss)||$||(2,480||)||$||(3,041||)||$||(12,519||)||$||(12,906||)|
|Basic earnings (loss) per common share|
|Basic loss per common share||$||(0.04||)||$||(0.05||)||$||(0.20||)||$||(0.21||)|
|Weighted-average common shares outstanding||62,012||61,543||61,866||61,445|
|Diluted earnings (loss) per common share|
|Diluted loss per common share||$||(0.04||)||$||(0.05||)||$||(0.20||)||$||(0.21||)|
|Weighted-average common and common equivalent shares outstanding||62,012||61,543||61,866||61,445|
|Balance Sheet Data (Unaudited)||September 30,||December 31,|
|Cash and cash equivalents||$||11,403||$||46,005|
|Harte Hanks, Inc.|
|Revenue Mix (Unaudited)|
|Vertical Markets - Percent of Revenue|
|Three Months Ended|
|Nine Months Ended|
About Harte Hanks:
Harte Hanks is a global marketing services firm specializing in multi-channel marketing solutions that connect our clients with their customers in powerful ways. Experts in defining, executing and optimizing the customer journey, Harte Hanks offers end-to-end marketing services including consulting, strategic assessment, data, analytics, digital, social, mobile, print, direct mail and contact center. From visionary thinking to tactical execution, Harte Hanks delivers smarter customer interactions for some of the world's leading brands. Harte Hanks 5,000+ employees are located in North America, Asia-Pacific and Europe. For more information, visit Harte Hanks at www.hartehanks.com, call 800-456-9748, email us at firstname.lastname@example.org. Follow us on Twitter @hartehanks or Facebook at https://www.facebook.com/HarteHanks.
Cautionary Note Regarding Forward-Looking Statements:
Our press release and related earnings conference call contain “forward-looking statements” within the meaning of U.S. federal securities laws. All such statements are qualified by this cautionary note, provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements other than historical facts are forward-looking and may be identified by words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “seeks,” “could,” “intends,” or words of similar meaning. These forward-looking statements are based on current information, expectations and estimates and involve risks, uncertainties, assumptions and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. In that event, our business, financial condition, results of operations or liquidity could be materially adversely affected and investors in our securities could lose part or all of their investments. These risks, uncertainties, assumptions and other factors include: (a) local, national and international economic and business conditions, including (i) market conditions that may adversely impact marketing expenditures and (ii) the impact of economic environments and competitive pressures on the financial condition, marketing expenditures and activities of our clients and prospects; (b) the demand for our products and services by clients and prospective clients, including (i) the willingness of existing clients to maintain or increase their spending on products and services that are or remain profitable for us, and (ii) our ability to predict changes in client needs and preferences; (c) economic and other business factors that impact the industry verticals we serve, including competition and consolidation of current and prospective clients, vendors and partners in these verticals; (d) our ability to manage and timely adjust our facilities, capacity, workforce and cost structure to effectively serve our clients; (e) our ability to improve our processes and to provide new products and services in a timely and cost-effective manner though development, license, partnership or acquisition; (f) our ability to protect our facilities against security breaches and other interruptions and to protect sensitive personal information of our clients and their customers; (g) our ability to respond to increasing concern, regulation and legal action over consumer privacy issues, including changing requirements for collection, processing and use of information; (h) the impact of privacy and other regulations, including restrictions on unsolicited marketing communications and other consumer protection laws; (i) fluctuations in fuel prices, paper prices, postal rates and postal delivery schedules; (j) the number of shares, if any, that we may repurchase in connection with our repurchase program; (k) unanticipated developments regarding litigation or other contingent liabilities; (l) the ability to integrate and successfully leverage newly-acquired service offerings as anticipated; (m) our ability to complete anticipated divestitures and reorganizations; and (n) other factors discussed from time to time in our filings with the Securities and Exchange Commission, including under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2016 and in our Quarterly Report on Form 10-Q for the three and six months ended June 30, 2017. The forward-looking statements in this press release and our related earnings conference call are made only as of the date hereof and we undertake no obligation to update publicly any forward-looking statement, even if new information becomes available or other events occur in the future.
Supplemental Non-GAAP Financial Measures:
In this press release and our related earnings conference call, the company may use certain non-GAAP measures of financial performance in order to provide investors with a better understanding of operating results and underlying trends to assess the company’s performance and liquidity. The company evaluates its operating performance based on several measures, including non-GAAP financial measures. The company believes that certain non-GAAP financial measures are useful supplemental financial measures of operating performance for investors because they facilitate investors’ ability to evaluate the operational strength of the company’s business. Any supplemental financial measures referred to are not calculated in accordance with GAAP and they should not be considered substitutes for net income as an indicator of operating performance.
As used herein, “Harte Hanks” refers to Harte Hanks, Inc. and/or its applicable operating subsidiaries, as the context may require. Harte Hanks’ logo and name are trademarks of Harte Hanks.
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Source:Harte Hanks, Inc.