Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries DHI Group Reports Full Year 2022 Revenue Growth of 25% and Guides for Continued Revenue Growth in 2023 By: DHI Group, Inc. via Business Wire February 07, 2023 at 16:15 PM EST DHI Group, Inc. (NYSE: DHX) (“DHI” or the “Company”) today announced financial results for the fourth quarter and full year ended December 31, 2022. Fourth Quarter 2022 Financial Highlights(1) Total revenue was $39.8 million, up 18% year over year. Total bookings were $37.7 million, up 4% year over year. Net income was $2.4 million, or $0.05 per diluted share, a net income margin of 6%, compared to net income of $0.2 million, or $0.00 per diluted share, a net income margin of 1%, in the year-ago quarter. Adjusted Diluted Earnings Per Share for the quarter was $0.01, versus $0.00 in the year-ago quarter. Adjusted EBITDA was $8.1 million, an Adjusted EBITDA Margin of 20%, compared to $7.1 million and 21%, respectively, in the year-ago quarter. Cash flow from operations was $7.3 million. Cash was $3.0 million and total debt was $30 million at quarter end. Full Year 2022 Financial Highlights(1) Total revenue was $149.7 million, up 25% year over year. Total bookings were $160.2 million, up 20% year over year. Net income was $4.2 million, or $0.09 per diluted share, a net income margin of 3%, compared to a net loss of $29.7 million, or $0.64 per diluted share, a negative net income margin of 25%, in the prior year. Adjusted Diluted Earnings Per Share for the year was $0.05, versus $0.02 a year-ago. Adjusted EBITDA was $31.0 million and Adjusted EBITDA Margin was 21%, compared to $26.2 million and 22%, respectively, a year-ago. Cash flow from operations was $36.0 million. (1) See definition of bookings and see "Notes Regarding the Use of Non-GAAP Financial Measures" related to Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share later in this press release. Commenting on 2022 performance, Art Zeile, President and CEO of DHI Group, said: "We delivered solid revenue growth, as well as strong revenue renewal and retention rates, in the fourth quarter and full year, as employers continued to use our subscription-based offering to find, attract, engage and hire the highest quality tech professionals. Even in this difficult macro environment, where we are constantly reading about layoffs of thousands of workers, there continues to be strong demand for technologists across all industries as organizations ramp their technology initiatives. December represented the 25th consecutive month of tech employment expansion in the U.S. and employers posted job openings for over 833,000 tech jobs during the fourth quarter. Notably, this is a deceleration from the 1.6 million posted job openings in second quarter of the year. Nevertheless, because the unemployment rate for technologists dropped in December to 1.8%, there remains two job openings for every one tech worker who is looking for employment. With this significant supply-demand gap, we believe more employers will need access to our growing community of six million plus tech candidates to fill the growing number of tech job openings. "Many companies are starting the year with a cautious spending outlook, which is lengthening our Dice new business sales cycle. However, we continue to see steady demand for ClearanceJobs as government contractors and agencies need to hire more technologists to staff newly funded federal programs following the largest U.S. defense budget increase in decades in the fourth quarter. With the dynamic new business sales team we have grown over the past two years, we are focusing several members on this near-term growth opportunity with ClearanceJobs. "During 2023, we expect to continue to invest in our industry-leading products, as the total addressable market for our subscription-based offerings remains at over $1 billion in annual spend, and we are just scratching the surface." Commenting on 2023 guidance, Kevin Bostick, CFO of DHI Group, said: "For 2023, we expect total revenue to grow in the low double-digit percentage range, year over year, for each quarter throughout the year. From a profitability perspective, we expect to maintain adjusted EBITDA margins at or near 20%, with margins expected to expand over the next 6-12 months. We are not limiting our investment in sales and marketing in the near term but will manage our hiring and expense structure accordingly during this challenging environment. We remain focused on driving long-term, sustainable value creation and want to be well positioned from a customer acquisition perspective when the economy begins its recovery." Conference Call Information Art Zeile, President and Chief Executive Officer, and Kevin Bostick, Chief Financial Officer, will host a conference call today, February 7, 2023, at 5:00 p.m. Eastern Time to discuss the Company’s financial results and recent developments. The call can be accessed by dialing 844-890-1790 (in the U.S.) or 412-380-7407 (outside the U.S.). Please ask to be placed into the DHI Group, Inc. call. A live webcast of the call will simultaneously be available through the Investor Relations section of the Company’s website, https://www.dhigroupinc.com, and available for replay after the call ends. About DHI Group, Inc. DHI Group, Inc (NYSE: DHX) is a provider of AI-powered career marketplaces that focus on technology roles. DHI’s two brands, Dice and ClearanceJobs, enable recruiters and hiring managers to efficiently search for and connect with highly skilled technologists based on the skills requested. The Company’s patented algorithm manages over 100,000 unique technology skills. Additionally, our marketplaces allow technology professionals to find their ideal next career opportunity, with relevant advice and personalized insights. Learn more at www.dhigroupinc.com. Forward-Looking Statements This press release and oral statements made from time to time by our representatives contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Forward-looking statements include, without limitation, information concerning our possible or assumed future financial condition, liquidity and results of operations, including expectations (financial or otherwise), our strategy, plans, objectives, expectations (financial or otherwise) and intentions, growth potential, and statements regarding our 2023 financial outlook. These statements often include words such as “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements are based on assumptions that we have made in light of our experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to execute our tech-focused strategy, competition from existing and future competitors in the highly competitive markets in which we operate, failure to adapt our business model to keep pace with rapid changes in the recruiting and career services business, failure to maintain and develop our reputation and brand recognition, failure to increase or maintain the number of customers who purchase recruitment packages, cyclicality or downturns in the economy or industries we serve, uncertainty in respect to the regulation of data protection and data privacy, failure to attract qualified professionals to our websites or grow the number of qualified professionals who use our websites, failure to successfully identify or integrate acquisitions, U.S. and foreign government regulation of the Internet and taxation, our ability to borrow funds under our revolving credit facility or refinance our indebtedness and restrictions on our current and future operations under such indebtedness. These factors and others are discussed in more detail in the Company’s filings with the Securities and Exchange Commission, all of which are available on the Investors page of our website at www.dhigroupinc.com, including the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings under the headings “Risk Factors,” “Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should keep in mind that any forward-looking statement made by the Company or its representatives herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect us. We have no obligation to update any forward-looking statements after the date hereof, except as required by applicable federal securities laws. Notes Regarding the Use of Non-GAAP Financial Measures The Company has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or alternatives to, measures in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures, such as Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. In addition, the Company’s management uses these measures for reviewing the financial results of the Company and for budgeting and planning purposes. Non-GAAP results exclude the impact of items that management believes affect the comparability or underlying business trends in our condensed consolidated financial statements in the periods presented. The non-GAAP measures apply to consolidated results or other measures as shown within this document. The Company has provided required reconciliations to the most comparable GAAP measures elsewhere in the document. Adjusted Diluted Earnings Per Share Adjusted Diluted Earnings Per Share is a non-GAAP performance measure that management believes is useful to investors and management in understanding our ongoing operations and in the analysis of operating trends. Adjusted Diluted Earnings Per Share is computed as diluted earnings per share plus or minus the impacts of certain non-cash and other items, including impairments, costs related to reorganizing the Company, including severance and related costs, gains or losses on investments, discontinued operations, proceeds from settlement, and discrete tax items. Adjusted Diluted Earnings Per Share is not a measurement of our financial performance under GAAP and should not be considered as an alternative to diluted earnings per share, net income, or any other performance measures derived in accordance with GAAP as a measure of our profitability. Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures used by management to measure operating performance. Management uses Adjusted EBITDA and Adjusted EBITDA Margin as performance measures for internal monitoring and planning, including preparation of annual budgets, analyzing investment decisions and evaluating profitability and performance comparisons between us and our competitors. The Company also uses these measures to calculate amounts of performance based compensation under the senior management incentive bonus program. Adjusted EBITDA represents net income plus (to the extent deducted in calculating such net income) interest expense, income tax expense, depreciation and amortization, and items such as non-cash stock-based compensation, losses resulting from certain dispositions outside the ordinary course of business including prior negative operating results of those divested businesses, certain write-offs in connection with indebtedness, impairment charges with respect to long-lived assets, expenses incurred in connection with an equity offering or any other offering of securities by the Company, extraordinary or non-recurring non-cash expenses or losses, losses from equity method investments, transaction costs in connection with the credit agreement, deferred revenues written off in connection with acquisition purchase accounting adjustments, write-off of non-cash stock-based compensation expense, severance and retention costs related to dispositions and reorganizations of the Company, and losses related to legal claims and fees that are unusual in nature or infrequent, minus (to the extent included in calculating such net income) non-cash income or gains, including income from equity method investments, interest income, business interruption insurance proceeds, and any income or gain resulting from certain dispositions outside the ordinary course of business, including prior positive operating results of those divested businesses, and gains related to legal claims that are unusual in nature or infrequent. Adjusted EBITDA Margin is computed as Adjusted EBITDA divided by Revenues. We also consider Adjusted EBITDA and Adjusted EBITDA Margin, as defined, to be important indicators to investors because they provide information related to our ability to provide cash flows to meet future debt service, capital expenditures, working capital requirements, and to fund future growth. We present Adjusted EBITDA and Adjusted EBITDA Margin as supplemental performance measures because we believe that these measures provide our board of directors, management and investors with additional information to measure our performance, provide comparisons from period to period by excluding potential differences caused by variations in capital structures (affecting interest expense) and tax positions (such as the impact on periods or companies of changes in effective tax rates or net operating losses), and to estimate our value. We understand that although Adjusted EBITDA and Adjusted EBITDA Margin are frequently used by securities analysts, lenders and others in their evaluation of companies, Adjusted EBITDA and Adjusted EBITDA Margin have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our liquidity or results as reported under GAAP. Some limitations are: Adjusted EBITDA and Adjusted EBITDA Margin do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; Adjusted EBITDA and Adjusted EBITDA Margin do not reflect changes in, or cash requirements for, our working capital needs; Adjusted EBITDA and Adjusted EBITDA Margin do not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our debt; Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect any cash requirements for such replacements; and Other companies in our industry may calculate Adjusted EBITDA and Adjusted EBITDA Margin differently than we do, limiting their usefulness as comparative measures. To compensate for these limitations, management evaluates our liquidity by considering the economic effect of excluded expense items independently, as well as in connection with its analysis of cash flows from operations and through the use of other financial measures, such as capital expenditure budget variances, investment spending levels and return on capital analysis. Adjusted EBITDA and Adjusted EBITDA Margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to revenue, net income, net income margin, operating income, cash provided by operating activities, or any other performance measures derived in accordance with GAAP as a measure of our profitability or liquidity. DHI GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share amounts) For the three months ended December 31, For the year ended December 31, 2022 2021 2022 2021 Revenues $ 39,762 $ 33,748 $ 149,680 $ 119,903 Operating expenses: Cost of revenues 4,766 4,002 17,607 15,088 Product development 4,692 4,852 17,674 16,020 Sales and marketing 16,157 12,487 59,364 43,701 General and administrative 8,506 7,934 34,049 28,583 Depreciation 4,893 4,314 17,487 16,344 Impairment of right-of-use asset — — — 1,919 Total operating expenses 39,014 33,589 146,181 121,655 Other operating income: Proceeds from settlement 2,061 — 2,061 — Total operating income 2,061 — 2,061 — Operating income (loss) 2,809 159 5,560 (1,752 ) Income from equity method investment 490 190 1,597 190 Gain on investments — — 320 1,198 Impairment of investment — — (2,300 ) — Interest expense and other (590 ) (235 ) (1,580 ) (667 ) Income (loss) before income taxes 2,709 114 3,597 (1,031 ) Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Income (loss) from continuing operations 2,351 232 4,176 (402 ) Loss from discontinued operations, net of tax — — — (29,340 ) Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Basic earnings (loss) per share - continuing operations $ 0.05 $ 0.01 $ 0.09 $ (0.01 ) Diluted earnings (loss) per share - continuing operations $ 0.05 $ — $ 0.09 $ (0.01 ) Basic loss per share - discontinued operations $ — $ — $ — $ (0.63 ) Diluted loss per share - discontinued operations $ — $ — $ — $ (0.63 ) Basic earnings (loss) per share $ 0.05 $ 0.01 $ 0.09 $ (0.64 ) Diluted earnings (loss) per share $ 0.05 $ — $ 0.09 $ (0.64 ) Weighted-average basic shares outstanding 43,593 45,126 44,274 46,333 Weighted-average diluted shares outstanding 46,149 48,721 46,533 46,333 DHI GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) For the three months ended December 31, For the year ended December 31, 2022 2021 2022 2021 Cash flows from (used in) operating activities: Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Adjustments to reconcile net income (loss) to net cash flows from (used in) operating activities: Depreciation 4,893 4,314 17,487 17,118 Deferred income taxes (118 ) 141 (3,800 ) (569 ) Amortization of deferred financing costs 36 37 146 147 Stock-based compensation 2,331 2,089 9,519 8,303 Income from equity method investment (490 ) (190 ) (1,597 ) (190 ) Impairment of right-of-use asset — — — 1,919 Impairment of investment — — 2,300 — Gain on investments — — (320 ) (1,198 ) Change in accrual for unrecognized tax benefits (224 ) (210 ) (16 ) (156 ) Loss on disposition of discontinued operations — — — 30,203 Changes in operating assets and liabilities: Accounts receivable (1,633 ) (3,118 ) (2,109 ) (1,102 ) Prepaid expenses and other assets (932 ) 128 (1,479 ) (1,032 ) Capitalized contract costs (955 ) (2,102 ) (545 ) (2,990 ) Accounts payable and accrued expenses 3,971 (137 ) 7,778 (1,520 ) Income taxes receivable/payable (347 ) (181 ) 388 261 Deferred revenue (1,388 ) 2,743 4,718 10,075 Other, net (146 ) (788 ) (611 ) (946 ) Net cash flows from operating activities 7,349 2,958 36,035 28,581 Cash flows from (used in) investing activities: Cash transferred with discontinued operations — (244 ) — (3,195 ) Cash paid for investment — — — (3,000 ) Cash received from sale of investment — — 320 1,198 Purchases of fixed assets (4,583 ) (3,600 ) (17,976 ) (14,307 ) Net cash flows used in investing activities (4,583 ) (3,844 ) (17,656 ) (19,304 ) Cash flows from (used in) financing activities: Payments on long-term debt (3,000 ) (2,000 ) (11,000 ) (11,000 ) Proceeds from long-term debt 3,000 7,000 18,000 14,000 Financing costs paid — — (515 ) — Payments under stock repurchase plan (3,567 ) (5,210 ) (18,530 ) (15,409 ) Purchase of treasury stock related to vested restricted and performance stock units (204 ) (850 ) (5,155 ) (2,978 ) Proceeds from issuance of common stock through ESPP 163 — 287 — Net cash flows used in financing activities (3,608 ) (1,060 ) (16,913 ) (15,387 ) Effect of exchange rate changes — — — 10 Net change in cash and cash equivalents for the period (842 ) (1,946 ) 1,466 (6,100 ) Cash and cash equivalents, beginning of period 3,848 3,486 1,540 7,640 Cash and cash equivalents, end of period $ 3,006 $ 1,540 $ 3,006 $ 1,540 DHI GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands) ASSETS December 31, 2022 December 31, 2021 Current assets Cash and cash equivalents $ 3,006 $ 1,540 Accounts receivable, net 20,494 18,385 Income taxes receivable — 354 Prepaid and other current assets 4,294 4,177 Total current assets 27,794 24,456 Fixed assets, net 21,252 20,581 Capitalized contract costs 9,677 9,131 Operating lease right-of-use assets 6,581 6,888 Investments 5,646 3,769 Investments, at fair value — 3,000 Acquired intangible assets 23,800 23,800 Goodwill 128,100 128,100 Other assets 3,854 1,853 Total assets $ 226,704 $ 221,578 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable and accrued expenses $ 23,818 $ 15,859 Deferred revenue 50,121 45,217 Income taxes payable 34 — Operating lease liabilities 105 2,388 Total current liabilities 74,078 63,464 Deferred revenue 743 929 Operating lease liabilities 8,428 6,982 Long-term debt, net 30,000 22,730 Deferred income taxes 5,515 9,315 Accrual for unrecognized tax benefits 769 785 Other long-term liabilities 932 1,011 Total liabilities 120,465 105,216 Total stockholders’ equity 106,239 116,362 Total liabilities and stockholders’ equity $ 226,704 $ 221,578 Supplemental Information and Non-GAAP Reconciliations On the pages that follow, the Company has provided certain supplemental information that we believe will assist the reader in assessing our business operations and performance, including certain non-GAAP financial information and required reconciliations to the most comparable GAAP measure. A statement of operations and statement of cash flows for the three and twelve month periods ended December 31, 2022 and 2021 and balance sheets as of December 31, 2022 and 2021 are provided elsewhere in this press release. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (Unaudited) (in thousands, except per share and customer data) Revenue Q4 2022 Q4 2021 $ Change % Change Dice1 $ 28,158 $ 24,351 $ 3,807 16 % ClearanceJobs 11,604 9,397 2,207 23 % Total Revenues $ 39,762 $ 33,748 $ 6,014 18 % Net income2 $ 2,351 $ 232 Net income margin3 6 % 1 % Diluted earnings per share2 $ 0.05 $ — Adjusted diluted earnings per share4 $ 0.01 $ — Adjusted EBITDA4 $ 8,098 $ 7,077 Adjusted EBITDA margin3 4 20 % 21 % Revenue FY 2022 FY 2021 $ Change % Change Dice $ 106,957 $ 86,257 $ 20,700 24 % ClearanceJobs 42,723 33,646 9,077 27 % Total Revenues $ 149,680 $ 119,903 $ 29,777 25 % Income (loss) from continuing operations5 $ 4,176 $ (402 ) Loss from discontinued operations, net of tax $ — $ (29,340 ) Net income (loss) $ 4,176 $ (29,742 ) Net income (loss) Margin3 3 % (25 )% Diluted earnings (loss) per share - continuing operations5 $ 0.09 $ (0.01 ) Diluted earnings (loss) per share - discontinued operations $ — $ (0.63 ) Diluted earnings (loss) per share $ 0.09 $ (0.64 ) Adjusted diluted earnings per share4 $ 0.05 $ 0.02 Adjusted EBITDA4 $ 30,950 $ 26,162 Adjusted EBITDA Margin3 4 21 % 22 % (1) Includes Dice and Career Events (2) Net income and diluted earnings per share for the three months ended December 31, 2022 includes the net positive impact of income from investments, proceeds from settlement, and severance and related costs, all net of tax, and discrete tax items of $2.0 million, or $0.04 per share. For the three months ended December 31, 2021, the Company recorded severance and related costs, all net of tax, and discrete tax items that approximately offset with no impact to net income and diluted earnings per share. (3) Net income (loss) margin and Adjusted EBITDA Margin are calculated by dividing the respective measure by that period's revenues. (4) See "Notes Regarding the Use of Non-GAAP Financial Measures" elsewhere in this press release. (5) Income from continuing operations and diluted earnings per share from continuing operations for the year ended December 31, 2022 includes the net positive impact of income from investments, proceeds from settlement, impairments and severance and related costs, all net of tax, and discrete tax items of $1.9 million, or $0.04 per share. Loss from continuing operations and diluted loss per share from continuing operations for the year ended December 31, 2021 includes the net negative impact of a right-of-use asset impairment, severance and related costs, and gain on investment, all net of tax, and discrete tax items of $1.2 million, or $0.02 per share. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Bookings1 Q4 2022 Q4 2021 $ Change % Change Dice $ 25,674 $ 25,937 $ (263 ) (1 )% ClearanceJobs 12,067 10,279 1,788 17 % Total Bookings $ 37,741 $ 36,216 $ 1,525 4 % FY 2022 FY 2021 $ Change % Change Dice $ 113,120 $ 95,481 $ 17,639 18 % ClearanceJobs 47,125 37,895 9,230 24 % Total Bookings $ 160,245 $ 133,376 $ 26,869 20 % (1) Bookings represent the value of all contractually committed services in which the contract start date is during the period and will be recognized as revenue within 12 months of the contract start date. For contracts that extend beyond 12 months, the value of those contracts beyond 12 months is recognized as bookings on each annual anniversary of each contract start date valued as the amount of revenue that will be recognized within 12 months of the respective anniversary date. Average Annual Revenue per Recruitment Package Customer1 Q4 2022 Q4 2021 $ Change % Change Dice $ 15,384 $ 13,920 $ 1,464 11 % ClearanceJobs $ 19,872 $ 17,832 $ 2,040 11 % FY 2022 FY 2021 $ Change % Change Dice $ 14,664 $ 13,644 $ 1,020 7 % ClearanceJobs $ 19,080 $ 17,028 $ 2,052 12 % (1) Calculated by dividing recruitment package customer revenue by the daily average count of recruitment package customers during each month, adjusted to reflect a 30-day month. The simple average of each month is used to derive the amount for each period and then annualized to reflect 12 months. Renewal Rates Renewal Rate on Revenue: Q4 2022 Q4 2021 FY 2022 FY 2021 Dice 94 % 91 % 99 % 87 % ClearanceJobs 98 % 105 % 100 % 96 % Renewal Rate on Count: Dice 83 % 86 % 85 % 79 % ClearanceJobs 80 % 88 % 84 % 85 % Retention Rates1 Q4 2022 Q4 2021 FY 2022 FY 2021 Dice 107 % 101 % 110 % 100 % ClearanceJobs 117 % 118 % 114 % 107 % (1) For customers that renewed their annual recruitment packages during the period, the retention rate represents the total contract value renewed, relative to the previous total contract value. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Recruitment Package Customers December 31, 2022 December 31, 2021 Change % Change Dice 6,311 6,004 307 5 % ClearanceJobs 2,064 1,878 186 10 % Deferred Revenue and Backlog1 December 31, 2022 December 31, 2021 $ Change % Change Deferred Revenue $ 50,864 $ 46,146 $ 4,718 10 % Contractual commitments not invoiced 66,391 46,497 19,894 43 % Backlog $ 117,255 $ 92,643 $ 24,612 27 % (1) Backlog consists of deferred revenue plus customer contractual commitments not invoiced representing the value of future services to be rendered under committed contracts. Adjusted Diluted Earnings per Share Q4 2022 Q4 2021 FY 2022 FY 2021 Reconciliation of Diluted Earnings (Loss) per Share to Adjusted Diluted Earnings per Share: Diluted earnings (loss) per share $ 0.05 $ — $ 0.09 $ (0.64 ) Impairment of investment and ROU asset, net of tax — — 0.05 0.03 Severance and related costs, net of tax — 0.01 0.01 0.03 Proceeds from settlement, net of tax (0.03 ) — (0.03 ) — Gain on investments, net of tax (0.01 ) — (0.03 ) (0.02 ) Discrete tax items — (0.01 ) (0.03 ) (0.02 ) Loss from discontinued operations, net of tax — — — 0.60 Other1 — — (0.01 ) 0.04 Adjusted diluted earnings per share $ 0.01 $ 0.00 $ 0.05 $ 0.02 Weighted average shares- diluted earnings per share 46,149 48,721 46,533 46,333 Weighted average shares - adjusted diluted earnings per share 49,149 48,721 46,533 48,912 (1) Adjusts, as applicable, for the share impact of common stock equivalents, where dilutive. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Adjusted EBITDA Reconciliations Q4 2022 Q4 2021 FY 2022 FY 2021 Reconciliation of Net Income (loss) to Adjusted EBITDA: Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Interest expense 590 231 1,580 748 Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Depreciation 4,893 4,314 17,487 16,344 Non-cash stock-based compensation 2,331 2,089 9,519 7,681 Income from equity method investment (490 ) (190 ) (1,597 ) (190 ) Impairment of right-of-use-asset — — — 1,919 Proceeds from settlement (2,061 ) — (2,061 ) — Gain on investments — — (320 ) (1,198 ) Impairment of investment — — 2,300 — Severance and related costs 126 513 445 1,969 Loss on discontinued operations, net of tax — — — 29,340 Other — 6 — (80 ) Adjusted EBITDA $ 8,098 $ 7,077 $ 30,950 $ 26,162 Reconciliation of Operating Cash Flows to Adjusted EBITDA: Net cash provided by operating activities $ 7,349 $ 2,958 $ 36,035 $ 28,581 Interest expense 590 231 1,580 748 Amortization of deferred financing costs (36 ) (37 ) (146 ) (147 ) Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Deferred income taxes 118 (141 ) 3,800 569 Change in accrual for unrecognized tax benefits 224 210 16 156 Change in accounts receivable 1,633 3,118 2,109 1,102 Change in deferred revenue 1,388 (2,743 ) (4,718 ) (10,075 ) Discontinued operations results — — — (3,593 ) Severance and related costs 126 513 445 1,969 Changes in working capital and other (3,652 ) 3,086 (7,592 ) 7,481 Adjusted EBITDA $ 8,098 $ 7,077 $ 30,950 $ 26,162 Guidance Earlier in this press release, the Company provided guidance for Adjusted EBITDA margin, which is a non-GAAP financial measure. We are unable to reconcile expected Adjusted EBITDA margin to its nearest GAAP measure without unreasonable efforts because we are unable to predict with a reasonable degree of certainty the actual impact of items such as non-cash stock based compensation, impairments, income tax expense, gains or losses from equity method investments, severance and retention costs, and legal claims and fees. By their very nature, these items are difficult to anticipate with precision because they are generally associated with unexpected and unplanned events that impact our company and its financial results. Therefore, we are unable to provide a reconciliation of this non-GAAP financial measure. View source version on businesswire.com: https://www.businesswire.com/news/home/20230207005495/en/Contacts Investor Contact Todd Kehrli or Jim Byers MKR Investor Relations, Inc. 212-448-4181 ir@dhigroupinc.com Media Contact Rachel Ceccarelli VP of Engagement 212-448-8288 media@dhigroupinc.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
DHI Group Reports Full Year 2022 Revenue Growth of 25% and Guides for Continued Revenue Growth in 2023 By: DHI Group, Inc. via Business Wire February 07, 2023 at 16:15 PM EST DHI Group, Inc. (NYSE: DHX) (“DHI” or the “Company”) today announced financial results for the fourth quarter and full year ended December 31, 2022. Fourth Quarter 2022 Financial Highlights(1) Total revenue was $39.8 million, up 18% year over year. Total bookings were $37.7 million, up 4% year over year. Net income was $2.4 million, or $0.05 per diluted share, a net income margin of 6%, compared to net income of $0.2 million, or $0.00 per diluted share, a net income margin of 1%, in the year-ago quarter. Adjusted Diluted Earnings Per Share for the quarter was $0.01, versus $0.00 in the year-ago quarter. Adjusted EBITDA was $8.1 million, an Adjusted EBITDA Margin of 20%, compared to $7.1 million and 21%, respectively, in the year-ago quarter. Cash flow from operations was $7.3 million. Cash was $3.0 million and total debt was $30 million at quarter end. Full Year 2022 Financial Highlights(1) Total revenue was $149.7 million, up 25% year over year. Total bookings were $160.2 million, up 20% year over year. Net income was $4.2 million, or $0.09 per diluted share, a net income margin of 3%, compared to a net loss of $29.7 million, or $0.64 per diluted share, a negative net income margin of 25%, in the prior year. Adjusted Diluted Earnings Per Share for the year was $0.05, versus $0.02 a year-ago. Adjusted EBITDA was $31.0 million and Adjusted EBITDA Margin was 21%, compared to $26.2 million and 22%, respectively, a year-ago. Cash flow from operations was $36.0 million. (1) See definition of bookings and see "Notes Regarding the Use of Non-GAAP Financial Measures" related to Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share later in this press release. Commenting on 2022 performance, Art Zeile, President and CEO of DHI Group, said: "We delivered solid revenue growth, as well as strong revenue renewal and retention rates, in the fourth quarter and full year, as employers continued to use our subscription-based offering to find, attract, engage and hire the highest quality tech professionals. Even in this difficult macro environment, where we are constantly reading about layoffs of thousands of workers, there continues to be strong demand for technologists across all industries as organizations ramp their technology initiatives. December represented the 25th consecutive month of tech employment expansion in the U.S. and employers posted job openings for over 833,000 tech jobs during the fourth quarter. Notably, this is a deceleration from the 1.6 million posted job openings in second quarter of the year. Nevertheless, because the unemployment rate for technologists dropped in December to 1.8%, there remains two job openings for every one tech worker who is looking for employment. With this significant supply-demand gap, we believe more employers will need access to our growing community of six million plus tech candidates to fill the growing number of tech job openings. "Many companies are starting the year with a cautious spending outlook, which is lengthening our Dice new business sales cycle. However, we continue to see steady demand for ClearanceJobs as government contractors and agencies need to hire more technologists to staff newly funded federal programs following the largest U.S. defense budget increase in decades in the fourth quarter. With the dynamic new business sales team we have grown over the past two years, we are focusing several members on this near-term growth opportunity with ClearanceJobs. "During 2023, we expect to continue to invest in our industry-leading products, as the total addressable market for our subscription-based offerings remains at over $1 billion in annual spend, and we are just scratching the surface." Commenting on 2023 guidance, Kevin Bostick, CFO of DHI Group, said: "For 2023, we expect total revenue to grow in the low double-digit percentage range, year over year, for each quarter throughout the year. From a profitability perspective, we expect to maintain adjusted EBITDA margins at or near 20%, with margins expected to expand over the next 6-12 months. We are not limiting our investment in sales and marketing in the near term but will manage our hiring and expense structure accordingly during this challenging environment. We remain focused on driving long-term, sustainable value creation and want to be well positioned from a customer acquisition perspective when the economy begins its recovery." Conference Call Information Art Zeile, President and Chief Executive Officer, and Kevin Bostick, Chief Financial Officer, will host a conference call today, February 7, 2023, at 5:00 p.m. Eastern Time to discuss the Company’s financial results and recent developments. The call can be accessed by dialing 844-890-1790 (in the U.S.) or 412-380-7407 (outside the U.S.). Please ask to be placed into the DHI Group, Inc. call. A live webcast of the call will simultaneously be available through the Investor Relations section of the Company’s website, https://www.dhigroupinc.com, and available for replay after the call ends. About DHI Group, Inc. DHI Group, Inc (NYSE: DHX) is a provider of AI-powered career marketplaces that focus on technology roles. DHI’s two brands, Dice and ClearanceJobs, enable recruiters and hiring managers to efficiently search for and connect with highly skilled technologists based on the skills requested. The Company’s patented algorithm manages over 100,000 unique technology skills. Additionally, our marketplaces allow technology professionals to find their ideal next career opportunity, with relevant advice and personalized insights. Learn more at www.dhigroupinc.com. Forward-Looking Statements This press release and oral statements made from time to time by our representatives contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Forward-looking statements include, without limitation, information concerning our possible or assumed future financial condition, liquidity and results of operations, including expectations (financial or otherwise), our strategy, plans, objectives, expectations (financial or otherwise) and intentions, growth potential, and statements regarding our 2023 financial outlook. These statements often include words such as “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements are based on assumptions that we have made in light of our experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to execute our tech-focused strategy, competition from existing and future competitors in the highly competitive markets in which we operate, failure to adapt our business model to keep pace with rapid changes in the recruiting and career services business, failure to maintain and develop our reputation and brand recognition, failure to increase or maintain the number of customers who purchase recruitment packages, cyclicality or downturns in the economy or industries we serve, uncertainty in respect to the regulation of data protection and data privacy, failure to attract qualified professionals to our websites or grow the number of qualified professionals who use our websites, failure to successfully identify or integrate acquisitions, U.S. and foreign government regulation of the Internet and taxation, our ability to borrow funds under our revolving credit facility or refinance our indebtedness and restrictions on our current and future operations under such indebtedness. These factors and others are discussed in more detail in the Company’s filings with the Securities and Exchange Commission, all of which are available on the Investors page of our website at www.dhigroupinc.com, including the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings under the headings “Risk Factors,” “Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should keep in mind that any forward-looking statement made by the Company or its representatives herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect us. We have no obligation to update any forward-looking statements after the date hereof, except as required by applicable federal securities laws. Notes Regarding the Use of Non-GAAP Financial Measures The Company has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or alternatives to, measures in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures, such as Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. In addition, the Company’s management uses these measures for reviewing the financial results of the Company and for budgeting and planning purposes. Non-GAAP results exclude the impact of items that management believes affect the comparability or underlying business trends in our condensed consolidated financial statements in the periods presented. The non-GAAP measures apply to consolidated results or other measures as shown within this document. The Company has provided required reconciliations to the most comparable GAAP measures elsewhere in the document. Adjusted Diluted Earnings Per Share Adjusted Diluted Earnings Per Share is a non-GAAP performance measure that management believes is useful to investors and management in understanding our ongoing operations and in the analysis of operating trends. Adjusted Diluted Earnings Per Share is computed as diluted earnings per share plus or minus the impacts of certain non-cash and other items, including impairments, costs related to reorganizing the Company, including severance and related costs, gains or losses on investments, discontinued operations, proceeds from settlement, and discrete tax items. Adjusted Diluted Earnings Per Share is not a measurement of our financial performance under GAAP and should not be considered as an alternative to diluted earnings per share, net income, or any other performance measures derived in accordance with GAAP as a measure of our profitability. Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures used by management to measure operating performance. Management uses Adjusted EBITDA and Adjusted EBITDA Margin as performance measures for internal monitoring and planning, including preparation of annual budgets, analyzing investment decisions and evaluating profitability and performance comparisons between us and our competitors. The Company also uses these measures to calculate amounts of performance based compensation under the senior management incentive bonus program. Adjusted EBITDA represents net income plus (to the extent deducted in calculating such net income) interest expense, income tax expense, depreciation and amortization, and items such as non-cash stock-based compensation, losses resulting from certain dispositions outside the ordinary course of business including prior negative operating results of those divested businesses, certain write-offs in connection with indebtedness, impairment charges with respect to long-lived assets, expenses incurred in connection with an equity offering or any other offering of securities by the Company, extraordinary or non-recurring non-cash expenses or losses, losses from equity method investments, transaction costs in connection with the credit agreement, deferred revenues written off in connection with acquisition purchase accounting adjustments, write-off of non-cash stock-based compensation expense, severance and retention costs related to dispositions and reorganizations of the Company, and losses related to legal claims and fees that are unusual in nature or infrequent, minus (to the extent included in calculating such net income) non-cash income or gains, including income from equity method investments, interest income, business interruption insurance proceeds, and any income or gain resulting from certain dispositions outside the ordinary course of business, including prior positive operating results of those divested businesses, and gains related to legal claims that are unusual in nature or infrequent. Adjusted EBITDA Margin is computed as Adjusted EBITDA divided by Revenues. We also consider Adjusted EBITDA and Adjusted EBITDA Margin, as defined, to be important indicators to investors because they provide information related to our ability to provide cash flows to meet future debt service, capital expenditures, working capital requirements, and to fund future growth. We present Adjusted EBITDA and Adjusted EBITDA Margin as supplemental performance measures because we believe that these measures provide our board of directors, management and investors with additional information to measure our performance, provide comparisons from period to period by excluding potential differences caused by variations in capital structures (affecting interest expense) and tax positions (such as the impact on periods or companies of changes in effective tax rates or net operating losses), and to estimate our value. We understand that although Adjusted EBITDA and Adjusted EBITDA Margin are frequently used by securities analysts, lenders and others in their evaluation of companies, Adjusted EBITDA and Adjusted EBITDA Margin have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our liquidity or results as reported under GAAP. Some limitations are: Adjusted EBITDA and Adjusted EBITDA Margin do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; Adjusted EBITDA and Adjusted EBITDA Margin do not reflect changes in, or cash requirements for, our working capital needs; Adjusted EBITDA and Adjusted EBITDA Margin do not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our debt; Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect any cash requirements for such replacements; and Other companies in our industry may calculate Adjusted EBITDA and Adjusted EBITDA Margin differently than we do, limiting their usefulness as comparative measures. To compensate for these limitations, management evaluates our liquidity by considering the economic effect of excluded expense items independently, as well as in connection with its analysis of cash flows from operations and through the use of other financial measures, such as capital expenditure budget variances, investment spending levels and return on capital analysis. Adjusted EBITDA and Adjusted EBITDA Margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to revenue, net income, net income margin, operating income, cash provided by operating activities, or any other performance measures derived in accordance with GAAP as a measure of our profitability or liquidity. DHI GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share amounts) For the three months ended December 31, For the year ended December 31, 2022 2021 2022 2021 Revenues $ 39,762 $ 33,748 $ 149,680 $ 119,903 Operating expenses: Cost of revenues 4,766 4,002 17,607 15,088 Product development 4,692 4,852 17,674 16,020 Sales and marketing 16,157 12,487 59,364 43,701 General and administrative 8,506 7,934 34,049 28,583 Depreciation 4,893 4,314 17,487 16,344 Impairment of right-of-use asset — — — 1,919 Total operating expenses 39,014 33,589 146,181 121,655 Other operating income: Proceeds from settlement 2,061 — 2,061 — Total operating income 2,061 — 2,061 — Operating income (loss) 2,809 159 5,560 (1,752 ) Income from equity method investment 490 190 1,597 190 Gain on investments — — 320 1,198 Impairment of investment — — (2,300 ) — Interest expense and other (590 ) (235 ) (1,580 ) (667 ) Income (loss) before income taxes 2,709 114 3,597 (1,031 ) Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Income (loss) from continuing operations 2,351 232 4,176 (402 ) Loss from discontinued operations, net of tax — — — (29,340 ) Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Basic earnings (loss) per share - continuing operations $ 0.05 $ 0.01 $ 0.09 $ (0.01 ) Diluted earnings (loss) per share - continuing operations $ 0.05 $ — $ 0.09 $ (0.01 ) Basic loss per share - discontinued operations $ — $ — $ — $ (0.63 ) Diluted loss per share - discontinued operations $ — $ — $ — $ (0.63 ) Basic earnings (loss) per share $ 0.05 $ 0.01 $ 0.09 $ (0.64 ) Diluted earnings (loss) per share $ 0.05 $ — $ 0.09 $ (0.64 ) Weighted-average basic shares outstanding 43,593 45,126 44,274 46,333 Weighted-average diluted shares outstanding 46,149 48,721 46,533 46,333 DHI GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) For the three months ended December 31, For the year ended December 31, 2022 2021 2022 2021 Cash flows from (used in) operating activities: Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Adjustments to reconcile net income (loss) to net cash flows from (used in) operating activities: Depreciation 4,893 4,314 17,487 17,118 Deferred income taxes (118 ) 141 (3,800 ) (569 ) Amortization of deferred financing costs 36 37 146 147 Stock-based compensation 2,331 2,089 9,519 8,303 Income from equity method investment (490 ) (190 ) (1,597 ) (190 ) Impairment of right-of-use asset — — — 1,919 Impairment of investment — — 2,300 — Gain on investments — — (320 ) (1,198 ) Change in accrual for unrecognized tax benefits (224 ) (210 ) (16 ) (156 ) Loss on disposition of discontinued operations — — — 30,203 Changes in operating assets and liabilities: Accounts receivable (1,633 ) (3,118 ) (2,109 ) (1,102 ) Prepaid expenses and other assets (932 ) 128 (1,479 ) (1,032 ) Capitalized contract costs (955 ) (2,102 ) (545 ) (2,990 ) Accounts payable and accrued expenses 3,971 (137 ) 7,778 (1,520 ) Income taxes receivable/payable (347 ) (181 ) 388 261 Deferred revenue (1,388 ) 2,743 4,718 10,075 Other, net (146 ) (788 ) (611 ) (946 ) Net cash flows from operating activities 7,349 2,958 36,035 28,581 Cash flows from (used in) investing activities: Cash transferred with discontinued operations — (244 ) — (3,195 ) Cash paid for investment — — — (3,000 ) Cash received from sale of investment — — 320 1,198 Purchases of fixed assets (4,583 ) (3,600 ) (17,976 ) (14,307 ) Net cash flows used in investing activities (4,583 ) (3,844 ) (17,656 ) (19,304 ) Cash flows from (used in) financing activities: Payments on long-term debt (3,000 ) (2,000 ) (11,000 ) (11,000 ) Proceeds from long-term debt 3,000 7,000 18,000 14,000 Financing costs paid — — (515 ) — Payments under stock repurchase plan (3,567 ) (5,210 ) (18,530 ) (15,409 ) Purchase of treasury stock related to vested restricted and performance stock units (204 ) (850 ) (5,155 ) (2,978 ) Proceeds from issuance of common stock through ESPP 163 — 287 — Net cash flows used in financing activities (3,608 ) (1,060 ) (16,913 ) (15,387 ) Effect of exchange rate changes — — — 10 Net change in cash and cash equivalents for the period (842 ) (1,946 ) 1,466 (6,100 ) Cash and cash equivalents, beginning of period 3,848 3,486 1,540 7,640 Cash and cash equivalents, end of period $ 3,006 $ 1,540 $ 3,006 $ 1,540 DHI GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands) ASSETS December 31, 2022 December 31, 2021 Current assets Cash and cash equivalents $ 3,006 $ 1,540 Accounts receivable, net 20,494 18,385 Income taxes receivable — 354 Prepaid and other current assets 4,294 4,177 Total current assets 27,794 24,456 Fixed assets, net 21,252 20,581 Capitalized contract costs 9,677 9,131 Operating lease right-of-use assets 6,581 6,888 Investments 5,646 3,769 Investments, at fair value — 3,000 Acquired intangible assets 23,800 23,800 Goodwill 128,100 128,100 Other assets 3,854 1,853 Total assets $ 226,704 $ 221,578 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable and accrued expenses $ 23,818 $ 15,859 Deferred revenue 50,121 45,217 Income taxes payable 34 — Operating lease liabilities 105 2,388 Total current liabilities 74,078 63,464 Deferred revenue 743 929 Operating lease liabilities 8,428 6,982 Long-term debt, net 30,000 22,730 Deferred income taxes 5,515 9,315 Accrual for unrecognized tax benefits 769 785 Other long-term liabilities 932 1,011 Total liabilities 120,465 105,216 Total stockholders’ equity 106,239 116,362 Total liabilities and stockholders’ equity $ 226,704 $ 221,578 Supplemental Information and Non-GAAP Reconciliations On the pages that follow, the Company has provided certain supplemental information that we believe will assist the reader in assessing our business operations and performance, including certain non-GAAP financial information and required reconciliations to the most comparable GAAP measure. A statement of operations and statement of cash flows for the three and twelve month periods ended December 31, 2022 and 2021 and balance sheets as of December 31, 2022 and 2021 are provided elsewhere in this press release. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (Unaudited) (in thousands, except per share and customer data) Revenue Q4 2022 Q4 2021 $ Change % Change Dice1 $ 28,158 $ 24,351 $ 3,807 16 % ClearanceJobs 11,604 9,397 2,207 23 % Total Revenues $ 39,762 $ 33,748 $ 6,014 18 % Net income2 $ 2,351 $ 232 Net income margin3 6 % 1 % Diluted earnings per share2 $ 0.05 $ — Adjusted diluted earnings per share4 $ 0.01 $ — Adjusted EBITDA4 $ 8,098 $ 7,077 Adjusted EBITDA margin3 4 20 % 21 % Revenue FY 2022 FY 2021 $ Change % Change Dice $ 106,957 $ 86,257 $ 20,700 24 % ClearanceJobs 42,723 33,646 9,077 27 % Total Revenues $ 149,680 $ 119,903 $ 29,777 25 % Income (loss) from continuing operations5 $ 4,176 $ (402 ) Loss from discontinued operations, net of tax $ — $ (29,340 ) Net income (loss) $ 4,176 $ (29,742 ) Net income (loss) Margin3 3 % (25 )% Diluted earnings (loss) per share - continuing operations5 $ 0.09 $ (0.01 ) Diluted earnings (loss) per share - discontinued operations $ — $ (0.63 ) Diluted earnings (loss) per share $ 0.09 $ (0.64 ) Adjusted diluted earnings per share4 $ 0.05 $ 0.02 Adjusted EBITDA4 $ 30,950 $ 26,162 Adjusted EBITDA Margin3 4 21 % 22 % (1) Includes Dice and Career Events (2) Net income and diluted earnings per share for the three months ended December 31, 2022 includes the net positive impact of income from investments, proceeds from settlement, and severance and related costs, all net of tax, and discrete tax items of $2.0 million, or $0.04 per share. For the three months ended December 31, 2021, the Company recorded severance and related costs, all net of tax, and discrete tax items that approximately offset with no impact to net income and diluted earnings per share. (3) Net income (loss) margin and Adjusted EBITDA Margin are calculated by dividing the respective measure by that period's revenues. (4) See "Notes Regarding the Use of Non-GAAP Financial Measures" elsewhere in this press release. (5) Income from continuing operations and diluted earnings per share from continuing operations for the year ended December 31, 2022 includes the net positive impact of income from investments, proceeds from settlement, impairments and severance and related costs, all net of tax, and discrete tax items of $1.9 million, or $0.04 per share. Loss from continuing operations and diluted loss per share from continuing operations for the year ended December 31, 2021 includes the net negative impact of a right-of-use asset impairment, severance and related costs, and gain on investment, all net of tax, and discrete tax items of $1.2 million, or $0.02 per share. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Bookings1 Q4 2022 Q4 2021 $ Change % Change Dice $ 25,674 $ 25,937 $ (263 ) (1 )% ClearanceJobs 12,067 10,279 1,788 17 % Total Bookings $ 37,741 $ 36,216 $ 1,525 4 % FY 2022 FY 2021 $ Change % Change Dice $ 113,120 $ 95,481 $ 17,639 18 % ClearanceJobs 47,125 37,895 9,230 24 % Total Bookings $ 160,245 $ 133,376 $ 26,869 20 % (1) Bookings represent the value of all contractually committed services in which the contract start date is during the period and will be recognized as revenue within 12 months of the contract start date. For contracts that extend beyond 12 months, the value of those contracts beyond 12 months is recognized as bookings on each annual anniversary of each contract start date valued as the amount of revenue that will be recognized within 12 months of the respective anniversary date. Average Annual Revenue per Recruitment Package Customer1 Q4 2022 Q4 2021 $ Change % Change Dice $ 15,384 $ 13,920 $ 1,464 11 % ClearanceJobs $ 19,872 $ 17,832 $ 2,040 11 % FY 2022 FY 2021 $ Change % Change Dice $ 14,664 $ 13,644 $ 1,020 7 % ClearanceJobs $ 19,080 $ 17,028 $ 2,052 12 % (1) Calculated by dividing recruitment package customer revenue by the daily average count of recruitment package customers during each month, adjusted to reflect a 30-day month. The simple average of each month is used to derive the amount for each period and then annualized to reflect 12 months. Renewal Rates Renewal Rate on Revenue: Q4 2022 Q4 2021 FY 2022 FY 2021 Dice 94 % 91 % 99 % 87 % ClearanceJobs 98 % 105 % 100 % 96 % Renewal Rate on Count: Dice 83 % 86 % 85 % 79 % ClearanceJobs 80 % 88 % 84 % 85 % Retention Rates1 Q4 2022 Q4 2021 FY 2022 FY 2021 Dice 107 % 101 % 110 % 100 % ClearanceJobs 117 % 118 % 114 % 107 % (1) For customers that renewed their annual recruitment packages during the period, the retention rate represents the total contract value renewed, relative to the previous total contract value. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Recruitment Package Customers December 31, 2022 December 31, 2021 Change % Change Dice 6,311 6,004 307 5 % ClearanceJobs 2,064 1,878 186 10 % Deferred Revenue and Backlog1 December 31, 2022 December 31, 2021 $ Change % Change Deferred Revenue $ 50,864 $ 46,146 $ 4,718 10 % Contractual commitments not invoiced 66,391 46,497 19,894 43 % Backlog $ 117,255 $ 92,643 $ 24,612 27 % (1) Backlog consists of deferred revenue plus customer contractual commitments not invoiced representing the value of future services to be rendered under committed contracts. Adjusted Diluted Earnings per Share Q4 2022 Q4 2021 FY 2022 FY 2021 Reconciliation of Diluted Earnings (Loss) per Share to Adjusted Diluted Earnings per Share: Diluted earnings (loss) per share $ 0.05 $ — $ 0.09 $ (0.64 ) Impairment of investment and ROU asset, net of tax — — 0.05 0.03 Severance and related costs, net of tax — 0.01 0.01 0.03 Proceeds from settlement, net of tax (0.03 ) — (0.03 ) — Gain on investments, net of tax (0.01 ) — (0.03 ) (0.02 ) Discrete tax items — (0.01 ) (0.03 ) (0.02 ) Loss from discontinued operations, net of tax — — — 0.60 Other1 — — (0.01 ) 0.04 Adjusted diluted earnings per share $ 0.01 $ 0.00 $ 0.05 $ 0.02 Weighted average shares- diluted earnings per share 46,149 48,721 46,533 46,333 Weighted average shares - adjusted diluted earnings per share 49,149 48,721 46,533 48,912 (1) Adjusts, as applicable, for the share impact of common stock equivalents, where dilutive. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Adjusted EBITDA Reconciliations Q4 2022 Q4 2021 FY 2022 FY 2021 Reconciliation of Net Income (loss) to Adjusted EBITDA: Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Interest expense 590 231 1,580 748 Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Depreciation 4,893 4,314 17,487 16,344 Non-cash stock-based compensation 2,331 2,089 9,519 7,681 Income from equity method investment (490 ) (190 ) (1,597 ) (190 ) Impairment of right-of-use-asset — — — 1,919 Proceeds from settlement (2,061 ) — (2,061 ) — Gain on investments — — (320 ) (1,198 ) Impairment of investment — — 2,300 — Severance and related costs 126 513 445 1,969 Loss on discontinued operations, net of tax — — — 29,340 Other — 6 — (80 ) Adjusted EBITDA $ 8,098 $ 7,077 $ 30,950 $ 26,162 Reconciliation of Operating Cash Flows to Adjusted EBITDA: Net cash provided by operating activities $ 7,349 $ 2,958 $ 36,035 $ 28,581 Interest expense 590 231 1,580 748 Amortization of deferred financing costs (36 ) (37 ) (146 ) (147 ) Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Deferred income taxes 118 (141 ) 3,800 569 Change in accrual for unrecognized tax benefits 224 210 16 156 Change in accounts receivable 1,633 3,118 2,109 1,102 Change in deferred revenue 1,388 (2,743 ) (4,718 ) (10,075 ) Discontinued operations results — — — (3,593 ) Severance and related costs 126 513 445 1,969 Changes in working capital and other (3,652 ) 3,086 (7,592 ) 7,481 Adjusted EBITDA $ 8,098 $ 7,077 $ 30,950 $ 26,162 Guidance Earlier in this press release, the Company provided guidance for Adjusted EBITDA margin, which is a non-GAAP financial measure. We are unable to reconcile expected Adjusted EBITDA margin to its nearest GAAP measure without unreasonable efforts because we are unable to predict with a reasonable degree of certainty the actual impact of items such as non-cash stock based compensation, impairments, income tax expense, gains or losses from equity method investments, severance and retention costs, and legal claims and fees. By their very nature, these items are difficult to anticipate with precision because they are generally associated with unexpected and unplanned events that impact our company and its financial results. Therefore, we are unable to provide a reconciliation of this non-GAAP financial measure. View source version on businesswire.com: https://www.businesswire.com/news/home/20230207005495/en/Contacts Investor Contact Todd Kehrli or Jim Byers MKR Investor Relations, Inc. 212-448-4181 ir@dhigroupinc.com Media Contact Rachel Ceccarelli VP of Engagement 212-448-8288 media@dhigroupinc.com
DHI Group, Inc. (NYSE: DHX) (“DHI” or the “Company”) today announced financial results for the fourth quarter and full year ended December 31, 2022. Fourth Quarter 2022 Financial Highlights(1) Total revenue was $39.8 million, up 18% year over year. Total bookings were $37.7 million, up 4% year over year. Net income was $2.4 million, or $0.05 per diluted share, a net income margin of 6%, compared to net income of $0.2 million, or $0.00 per diluted share, a net income margin of 1%, in the year-ago quarter. Adjusted Diluted Earnings Per Share for the quarter was $0.01, versus $0.00 in the year-ago quarter. Adjusted EBITDA was $8.1 million, an Adjusted EBITDA Margin of 20%, compared to $7.1 million and 21%, respectively, in the year-ago quarter. Cash flow from operations was $7.3 million. Cash was $3.0 million and total debt was $30 million at quarter end. Full Year 2022 Financial Highlights(1) Total revenue was $149.7 million, up 25% year over year. Total bookings were $160.2 million, up 20% year over year. Net income was $4.2 million, or $0.09 per diluted share, a net income margin of 3%, compared to a net loss of $29.7 million, or $0.64 per diluted share, a negative net income margin of 25%, in the prior year. Adjusted Diluted Earnings Per Share for the year was $0.05, versus $0.02 a year-ago. Adjusted EBITDA was $31.0 million and Adjusted EBITDA Margin was 21%, compared to $26.2 million and 22%, respectively, a year-ago. Cash flow from operations was $36.0 million. (1) See definition of bookings and see "Notes Regarding the Use of Non-GAAP Financial Measures" related to Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share later in this press release. Commenting on 2022 performance, Art Zeile, President and CEO of DHI Group, said: "We delivered solid revenue growth, as well as strong revenue renewal and retention rates, in the fourth quarter and full year, as employers continued to use our subscription-based offering to find, attract, engage and hire the highest quality tech professionals. Even in this difficult macro environment, where we are constantly reading about layoffs of thousands of workers, there continues to be strong demand for technologists across all industries as organizations ramp their technology initiatives. December represented the 25th consecutive month of tech employment expansion in the U.S. and employers posted job openings for over 833,000 tech jobs during the fourth quarter. Notably, this is a deceleration from the 1.6 million posted job openings in second quarter of the year. Nevertheless, because the unemployment rate for technologists dropped in December to 1.8%, there remains two job openings for every one tech worker who is looking for employment. With this significant supply-demand gap, we believe more employers will need access to our growing community of six million plus tech candidates to fill the growing number of tech job openings. "Many companies are starting the year with a cautious spending outlook, which is lengthening our Dice new business sales cycle. However, we continue to see steady demand for ClearanceJobs as government contractors and agencies need to hire more technologists to staff newly funded federal programs following the largest U.S. defense budget increase in decades in the fourth quarter. With the dynamic new business sales team we have grown over the past two years, we are focusing several members on this near-term growth opportunity with ClearanceJobs. "During 2023, we expect to continue to invest in our industry-leading products, as the total addressable market for our subscription-based offerings remains at over $1 billion in annual spend, and we are just scratching the surface." Commenting on 2023 guidance, Kevin Bostick, CFO of DHI Group, said: "For 2023, we expect total revenue to grow in the low double-digit percentage range, year over year, for each quarter throughout the year. From a profitability perspective, we expect to maintain adjusted EBITDA margins at or near 20%, with margins expected to expand over the next 6-12 months. We are not limiting our investment in sales and marketing in the near term but will manage our hiring and expense structure accordingly during this challenging environment. We remain focused on driving long-term, sustainable value creation and want to be well positioned from a customer acquisition perspective when the economy begins its recovery." Conference Call Information Art Zeile, President and Chief Executive Officer, and Kevin Bostick, Chief Financial Officer, will host a conference call today, February 7, 2023, at 5:00 p.m. Eastern Time to discuss the Company’s financial results and recent developments. The call can be accessed by dialing 844-890-1790 (in the U.S.) or 412-380-7407 (outside the U.S.). Please ask to be placed into the DHI Group, Inc. call. A live webcast of the call will simultaneously be available through the Investor Relations section of the Company’s website, https://www.dhigroupinc.com, and available for replay after the call ends. About DHI Group, Inc. DHI Group, Inc (NYSE: DHX) is a provider of AI-powered career marketplaces that focus on technology roles. DHI’s two brands, Dice and ClearanceJobs, enable recruiters and hiring managers to efficiently search for and connect with highly skilled technologists based on the skills requested. The Company’s patented algorithm manages over 100,000 unique technology skills. Additionally, our marketplaces allow technology professionals to find their ideal next career opportunity, with relevant advice and personalized insights. Learn more at www.dhigroupinc.com. Forward-Looking Statements This press release and oral statements made from time to time by our representatives contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Forward-looking statements include, without limitation, information concerning our possible or assumed future financial condition, liquidity and results of operations, including expectations (financial or otherwise), our strategy, plans, objectives, expectations (financial or otherwise) and intentions, growth potential, and statements regarding our 2023 financial outlook. These statements often include words such as “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements are based on assumptions that we have made in light of our experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to execute our tech-focused strategy, competition from existing and future competitors in the highly competitive markets in which we operate, failure to adapt our business model to keep pace with rapid changes in the recruiting and career services business, failure to maintain and develop our reputation and brand recognition, failure to increase or maintain the number of customers who purchase recruitment packages, cyclicality or downturns in the economy or industries we serve, uncertainty in respect to the regulation of data protection and data privacy, failure to attract qualified professionals to our websites or grow the number of qualified professionals who use our websites, failure to successfully identify or integrate acquisitions, U.S. and foreign government regulation of the Internet and taxation, our ability to borrow funds under our revolving credit facility or refinance our indebtedness and restrictions on our current and future operations under such indebtedness. These factors and others are discussed in more detail in the Company’s filings with the Securities and Exchange Commission, all of which are available on the Investors page of our website at www.dhigroupinc.com, including the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings under the headings “Risk Factors,” “Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should keep in mind that any forward-looking statement made by the Company or its representatives herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect us. We have no obligation to update any forward-looking statements after the date hereof, except as required by applicable federal securities laws. Notes Regarding the Use of Non-GAAP Financial Measures The Company has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or alternatives to, measures in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures, such as Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Diluted Earnings Per Share provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. In addition, the Company’s management uses these measures for reviewing the financial results of the Company and for budgeting and planning purposes. Non-GAAP results exclude the impact of items that management believes affect the comparability or underlying business trends in our condensed consolidated financial statements in the periods presented. The non-GAAP measures apply to consolidated results or other measures as shown within this document. The Company has provided required reconciliations to the most comparable GAAP measures elsewhere in the document. Adjusted Diluted Earnings Per Share Adjusted Diluted Earnings Per Share is a non-GAAP performance measure that management believes is useful to investors and management in understanding our ongoing operations and in the analysis of operating trends. Adjusted Diluted Earnings Per Share is computed as diluted earnings per share plus or minus the impacts of certain non-cash and other items, including impairments, costs related to reorganizing the Company, including severance and related costs, gains or losses on investments, discontinued operations, proceeds from settlement, and discrete tax items. Adjusted Diluted Earnings Per Share is not a measurement of our financial performance under GAAP and should not be considered as an alternative to diluted earnings per share, net income, or any other performance measures derived in accordance with GAAP as a measure of our profitability. Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures used by management to measure operating performance. Management uses Adjusted EBITDA and Adjusted EBITDA Margin as performance measures for internal monitoring and planning, including preparation of annual budgets, analyzing investment decisions and evaluating profitability and performance comparisons between us and our competitors. The Company also uses these measures to calculate amounts of performance based compensation under the senior management incentive bonus program. Adjusted EBITDA represents net income plus (to the extent deducted in calculating such net income) interest expense, income tax expense, depreciation and amortization, and items such as non-cash stock-based compensation, losses resulting from certain dispositions outside the ordinary course of business including prior negative operating results of those divested businesses, certain write-offs in connection with indebtedness, impairment charges with respect to long-lived assets, expenses incurred in connection with an equity offering or any other offering of securities by the Company, extraordinary or non-recurring non-cash expenses or losses, losses from equity method investments, transaction costs in connection with the credit agreement, deferred revenues written off in connection with acquisition purchase accounting adjustments, write-off of non-cash stock-based compensation expense, severance and retention costs related to dispositions and reorganizations of the Company, and losses related to legal claims and fees that are unusual in nature or infrequent, minus (to the extent included in calculating such net income) non-cash income or gains, including income from equity method investments, interest income, business interruption insurance proceeds, and any income or gain resulting from certain dispositions outside the ordinary course of business, including prior positive operating results of those divested businesses, and gains related to legal claims that are unusual in nature or infrequent. Adjusted EBITDA Margin is computed as Adjusted EBITDA divided by Revenues. We also consider Adjusted EBITDA and Adjusted EBITDA Margin, as defined, to be important indicators to investors because they provide information related to our ability to provide cash flows to meet future debt service, capital expenditures, working capital requirements, and to fund future growth. We present Adjusted EBITDA and Adjusted EBITDA Margin as supplemental performance measures because we believe that these measures provide our board of directors, management and investors with additional information to measure our performance, provide comparisons from period to period by excluding potential differences caused by variations in capital structures (affecting interest expense) and tax positions (such as the impact on periods or companies of changes in effective tax rates or net operating losses), and to estimate our value. We understand that although Adjusted EBITDA and Adjusted EBITDA Margin are frequently used by securities analysts, lenders and others in their evaluation of companies, Adjusted EBITDA and Adjusted EBITDA Margin have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our liquidity or results as reported under GAAP. Some limitations are: Adjusted EBITDA and Adjusted EBITDA Margin do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; Adjusted EBITDA and Adjusted EBITDA Margin do not reflect changes in, or cash requirements for, our working capital needs; Adjusted EBITDA and Adjusted EBITDA Margin do not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our debt; Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect any cash requirements for such replacements; and Other companies in our industry may calculate Adjusted EBITDA and Adjusted EBITDA Margin differently than we do, limiting their usefulness as comparative measures. To compensate for these limitations, management evaluates our liquidity by considering the economic effect of excluded expense items independently, as well as in connection with its analysis of cash flows from operations and through the use of other financial measures, such as capital expenditure budget variances, investment spending levels and return on capital analysis. Adjusted EBITDA and Adjusted EBITDA Margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to revenue, net income, net income margin, operating income, cash provided by operating activities, or any other performance measures derived in accordance with GAAP as a measure of our profitability or liquidity. DHI GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share amounts) For the three months ended December 31, For the year ended December 31, 2022 2021 2022 2021 Revenues $ 39,762 $ 33,748 $ 149,680 $ 119,903 Operating expenses: Cost of revenues 4,766 4,002 17,607 15,088 Product development 4,692 4,852 17,674 16,020 Sales and marketing 16,157 12,487 59,364 43,701 General and administrative 8,506 7,934 34,049 28,583 Depreciation 4,893 4,314 17,487 16,344 Impairment of right-of-use asset — — — 1,919 Total operating expenses 39,014 33,589 146,181 121,655 Other operating income: Proceeds from settlement 2,061 — 2,061 — Total operating income 2,061 — 2,061 — Operating income (loss) 2,809 159 5,560 (1,752 ) Income from equity method investment 490 190 1,597 190 Gain on investments — — 320 1,198 Impairment of investment — — (2,300 ) — Interest expense and other (590 ) (235 ) (1,580 ) (667 ) Income (loss) before income taxes 2,709 114 3,597 (1,031 ) Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Income (loss) from continuing operations 2,351 232 4,176 (402 ) Loss from discontinued operations, net of tax — — — (29,340 ) Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Basic earnings (loss) per share - continuing operations $ 0.05 $ 0.01 $ 0.09 $ (0.01 ) Diluted earnings (loss) per share - continuing operations $ 0.05 $ — $ 0.09 $ (0.01 ) Basic loss per share - discontinued operations $ — $ — $ — $ (0.63 ) Diluted loss per share - discontinued operations $ — $ — $ — $ (0.63 ) Basic earnings (loss) per share $ 0.05 $ 0.01 $ 0.09 $ (0.64 ) Diluted earnings (loss) per share $ 0.05 $ — $ 0.09 $ (0.64 ) Weighted-average basic shares outstanding 43,593 45,126 44,274 46,333 Weighted-average diluted shares outstanding 46,149 48,721 46,533 46,333 DHI GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) For the three months ended December 31, For the year ended December 31, 2022 2021 2022 2021 Cash flows from (used in) operating activities: Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Adjustments to reconcile net income (loss) to net cash flows from (used in) operating activities: Depreciation 4,893 4,314 17,487 17,118 Deferred income taxes (118 ) 141 (3,800 ) (569 ) Amortization of deferred financing costs 36 37 146 147 Stock-based compensation 2,331 2,089 9,519 8,303 Income from equity method investment (490 ) (190 ) (1,597 ) (190 ) Impairment of right-of-use asset — — — 1,919 Impairment of investment — — 2,300 — Gain on investments — — (320 ) (1,198 ) Change in accrual for unrecognized tax benefits (224 ) (210 ) (16 ) (156 ) Loss on disposition of discontinued operations — — — 30,203 Changes in operating assets and liabilities: Accounts receivable (1,633 ) (3,118 ) (2,109 ) (1,102 ) Prepaid expenses and other assets (932 ) 128 (1,479 ) (1,032 ) Capitalized contract costs (955 ) (2,102 ) (545 ) (2,990 ) Accounts payable and accrued expenses 3,971 (137 ) 7,778 (1,520 ) Income taxes receivable/payable (347 ) (181 ) 388 261 Deferred revenue (1,388 ) 2,743 4,718 10,075 Other, net (146 ) (788 ) (611 ) (946 ) Net cash flows from operating activities 7,349 2,958 36,035 28,581 Cash flows from (used in) investing activities: Cash transferred with discontinued operations — (244 ) — (3,195 ) Cash paid for investment — — — (3,000 ) Cash received from sale of investment — — 320 1,198 Purchases of fixed assets (4,583 ) (3,600 ) (17,976 ) (14,307 ) Net cash flows used in investing activities (4,583 ) (3,844 ) (17,656 ) (19,304 ) Cash flows from (used in) financing activities: Payments on long-term debt (3,000 ) (2,000 ) (11,000 ) (11,000 ) Proceeds from long-term debt 3,000 7,000 18,000 14,000 Financing costs paid — — (515 ) — Payments under stock repurchase plan (3,567 ) (5,210 ) (18,530 ) (15,409 ) Purchase of treasury stock related to vested restricted and performance stock units (204 ) (850 ) (5,155 ) (2,978 ) Proceeds from issuance of common stock through ESPP 163 — 287 — Net cash flows used in financing activities (3,608 ) (1,060 ) (16,913 ) (15,387 ) Effect of exchange rate changes — — — 10 Net change in cash and cash equivalents for the period (842 ) (1,946 ) 1,466 (6,100 ) Cash and cash equivalents, beginning of period 3,848 3,486 1,540 7,640 Cash and cash equivalents, end of period $ 3,006 $ 1,540 $ 3,006 $ 1,540 DHI GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands) ASSETS December 31, 2022 December 31, 2021 Current assets Cash and cash equivalents $ 3,006 $ 1,540 Accounts receivable, net 20,494 18,385 Income taxes receivable — 354 Prepaid and other current assets 4,294 4,177 Total current assets 27,794 24,456 Fixed assets, net 21,252 20,581 Capitalized contract costs 9,677 9,131 Operating lease right-of-use assets 6,581 6,888 Investments 5,646 3,769 Investments, at fair value — 3,000 Acquired intangible assets 23,800 23,800 Goodwill 128,100 128,100 Other assets 3,854 1,853 Total assets $ 226,704 $ 221,578 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable and accrued expenses $ 23,818 $ 15,859 Deferred revenue 50,121 45,217 Income taxes payable 34 — Operating lease liabilities 105 2,388 Total current liabilities 74,078 63,464 Deferred revenue 743 929 Operating lease liabilities 8,428 6,982 Long-term debt, net 30,000 22,730 Deferred income taxes 5,515 9,315 Accrual for unrecognized tax benefits 769 785 Other long-term liabilities 932 1,011 Total liabilities 120,465 105,216 Total stockholders’ equity 106,239 116,362 Total liabilities and stockholders’ equity $ 226,704 $ 221,578 Supplemental Information and Non-GAAP Reconciliations On the pages that follow, the Company has provided certain supplemental information that we believe will assist the reader in assessing our business operations and performance, including certain non-GAAP financial information and required reconciliations to the most comparable GAAP measure. A statement of operations and statement of cash flows for the three and twelve month periods ended December 31, 2022 and 2021 and balance sheets as of December 31, 2022 and 2021 are provided elsewhere in this press release. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (Unaudited) (in thousands, except per share and customer data) Revenue Q4 2022 Q4 2021 $ Change % Change Dice1 $ 28,158 $ 24,351 $ 3,807 16 % ClearanceJobs 11,604 9,397 2,207 23 % Total Revenues $ 39,762 $ 33,748 $ 6,014 18 % Net income2 $ 2,351 $ 232 Net income margin3 6 % 1 % Diluted earnings per share2 $ 0.05 $ — Adjusted diluted earnings per share4 $ 0.01 $ — Adjusted EBITDA4 $ 8,098 $ 7,077 Adjusted EBITDA margin3 4 20 % 21 % Revenue FY 2022 FY 2021 $ Change % Change Dice $ 106,957 $ 86,257 $ 20,700 24 % ClearanceJobs 42,723 33,646 9,077 27 % Total Revenues $ 149,680 $ 119,903 $ 29,777 25 % Income (loss) from continuing operations5 $ 4,176 $ (402 ) Loss from discontinued operations, net of tax $ — $ (29,340 ) Net income (loss) $ 4,176 $ (29,742 ) Net income (loss) Margin3 3 % (25 )% Diluted earnings (loss) per share - continuing operations5 $ 0.09 $ (0.01 ) Diluted earnings (loss) per share - discontinued operations $ — $ (0.63 ) Diluted earnings (loss) per share $ 0.09 $ (0.64 ) Adjusted diluted earnings per share4 $ 0.05 $ 0.02 Adjusted EBITDA4 $ 30,950 $ 26,162 Adjusted EBITDA Margin3 4 21 % 22 % (1) Includes Dice and Career Events (2) Net income and diluted earnings per share for the three months ended December 31, 2022 includes the net positive impact of income from investments, proceeds from settlement, and severance and related costs, all net of tax, and discrete tax items of $2.0 million, or $0.04 per share. For the three months ended December 31, 2021, the Company recorded severance and related costs, all net of tax, and discrete tax items that approximately offset with no impact to net income and diluted earnings per share. (3) Net income (loss) margin and Adjusted EBITDA Margin are calculated by dividing the respective measure by that period's revenues. (4) See "Notes Regarding the Use of Non-GAAP Financial Measures" elsewhere in this press release. (5) Income from continuing operations and diluted earnings per share from continuing operations for the year ended December 31, 2022 includes the net positive impact of income from investments, proceeds from settlement, impairments and severance and related costs, all net of tax, and discrete tax items of $1.9 million, or $0.04 per share. Loss from continuing operations and diluted loss per share from continuing operations for the year ended December 31, 2021 includes the net negative impact of a right-of-use asset impairment, severance and related costs, and gain on investment, all net of tax, and discrete tax items of $1.2 million, or $0.02 per share. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Bookings1 Q4 2022 Q4 2021 $ Change % Change Dice $ 25,674 $ 25,937 $ (263 ) (1 )% ClearanceJobs 12,067 10,279 1,788 17 % Total Bookings $ 37,741 $ 36,216 $ 1,525 4 % FY 2022 FY 2021 $ Change % Change Dice $ 113,120 $ 95,481 $ 17,639 18 % ClearanceJobs 47,125 37,895 9,230 24 % Total Bookings $ 160,245 $ 133,376 $ 26,869 20 % (1) Bookings represent the value of all contractually committed services in which the contract start date is during the period and will be recognized as revenue within 12 months of the contract start date. For contracts that extend beyond 12 months, the value of those contracts beyond 12 months is recognized as bookings on each annual anniversary of each contract start date valued as the amount of revenue that will be recognized within 12 months of the respective anniversary date. Average Annual Revenue per Recruitment Package Customer1 Q4 2022 Q4 2021 $ Change % Change Dice $ 15,384 $ 13,920 $ 1,464 11 % ClearanceJobs $ 19,872 $ 17,832 $ 2,040 11 % FY 2022 FY 2021 $ Change % Change Dice $ 14,664 $ 13,644 $ 1,020 7 % ClearanceJobs $ 19,080 $ 17,028 $ 2,052 12 % (1) Calculated by dividing recruitment package customer revenue by the daily average count of recruitment package customers during each month, adjusted to reflect a 30-day month. The simple average of each month is used to derive the amount for each period and then annualized to reflect 12 months. Renewal Rates Renewal Rate on Revenue: Q4 2022 Q4 2021 FY 2022 FY 2021 Dice 94 % 91 % 99 % 87 % ClearanceJobs 98 % 105 % 100 % 96 % Renewal Rate on Count: Dice 83 % 86 % 85 % 79 % ClearanceJobs 80 % 88 % 84 % 85 % Retention Rates1 Q4 2022 Q4 2021 FY 2022 FY 2021 Dice 107 % 101 % 110 % 100 % ClearanceJobs 117 % 118 % 114 % 107 % (1) For customers that renewed their annual recruitment packages during the period, the retention rate represents the total contract value renewed, relative to the previous total contract value. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Recruitment Package Customers December 31, 2022 December 31, 2021 Change % Change Dice 6,311 6,004 307 5 % ClearanceJobs 2,064 1,878 186 10 % Deferred Revenue and Backlog1 December 31, 2022 December 31, 2021 $ Change % Change Deferred Revenue $ 50,864 $ 46,146 $ 4,718 10 % Contractual commitments not invoiced 66,391 46,497 19,894 43 % Backlog $ 117,255 $ 92,643 $ 24,612 27 % (1) Backlog consists of deferred revenue plus customer contractual commitments not invoiced representing the value of future services to be rendered under committed contracts. Adjusted Diluted Earnings per Share Q4 2022 Q4 2021 FY 2022 FY 2021 Reconciliation of Diluted Earnings (Loss) per Share to Adjusted Diluted Earnings per Share: Diluted earnings (loss) per share $ 0.05 $ — $ 0.09 $ (0.64 ) Impairment of investment and ROU asset, net of tax — — 0.05 0.03 Severance and related costs, net of tax — 0.01 0.01 0.03 Proceeds from settlement, net of tax (0.03 ) — (0.03 ) — Gain on investments, net of tax (0.01 ) — (0.03 ) (0.02 ) Discrete tax items — (0.01 ) (0.03 ) (0.02 ) Loss from discontinued operations, net of tax — — — 0.60 Other1 — — (0.01 ) 0.04 Adjusted diluted earnings per share $ 0.01 $ 0.00 $ 0.05 $ 0.02 Weighted average shares- diluted earnings per share 46,149 48,721 46,533 46,333 Weighted average shares - adjusted diluted earnings per share 49,149 48,721 46,533 48,912 (1) Adjusts, as applicable, for the share impact of common stock equivalents, where dilutive. DHI GROUP, INC. NON-GAAP & SUPPLEMENTAL DATA (CONTINUED) (Unaudited) (in thousands, except per share and customer data) Adjusted EBITDA Reconciliations Q4 2022 Q4 2021 FY 2022 FY 2021 Reconciliation of Net Income (loss) to Adjusted EBITDA: Net income (loss) $ 2,351 $ 232 $ 4,176 $ (29,742 ) Interest expense 590 231 1,580 748 Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Depreciation 4,893 4,314 17,487 16,344 Non-cash stock-based compensation 2,331 2,089 9,519 7,681 Income from equity method investment (490 ) (190 ) (1,597 ) (190 ) Impairment of right-of-use-asset — — — 1,919 Proceeds from settlement (2,061 ) — (2,061 ) — Gain on investments — — (320 ) (1,198 ) Impairment of investment — — 2,300 — Severance and related costs 126 513 445 1,969 Loss on discontinued operations, net of tax — — — 29,340 Other — 6 — (80 ) Adjusted EBITDA $ 8,098 $ 7,077 $ 30,950 $ 26,162 Reconciliation of Operating Cash Flows to Adjusted EBITDA: Net cash provided by operating activities $ 7,349 $ 2,958 $ 36,035 $ 28,581 Interest expense 590 231 1,580 748 Amortization of deferred financing costs (36 ) (37 ) (146 ) (147 ) Income tax expense (benefit) 358 (118 ) (579 ) (629 ) Deferred income taxes 118 (141 ) 3,800 569 Change in accrual for unrecognized tax benefits 224 210 16 156 Change in accounts receivable 1,633 3,118 2,109 1,102 Change in deferred revenue 1,388 (2,743 ) (4,718 ) (10,075 ) Discontinued operations results — — — (3,593 ) Severance and related costs 126 513 445 1,969 Changes in working capital and other (3,652 ) 3,086 (7,592 ) 7,481 Adjusted EBITDA $ 8,098 $ 7,077 $ 30,950 $ 26,162 Guidance Earlier in this press release, the Company provided guidance for Adjusted EBITDA margin, which is a non-GAAP financial measure. We are unable to reconcile expected Adjusted EBITDA margin to its nearest GAAP measure without unreasonable efforts because we are unable to predict with a reasonable degree of certainty the actual impact of items such as non-cash stock based compensation, impairments, income tax expense, gains or losses from equity method investments, severance and retention costs, and legal claims and fees. By their very nature, these items are difficult to anticipate with precision because they are generally associated with unexpected and unplanned events that impact our company and its financial results. Therefore, we are unable to provide a reconciliation of this non-GAAP financial measure. View source version on businesswire.com: https://www.businesswire.com/news/home/20230207005495/en/
Investor Contact Todd Kehrli or Jim Byers MKR Investor Relations, Inc. 212-448-4181 ir@dhigroupinc.com Media Contact Rachel Ceccarelli VP of Engagement 212-448-8288 media@dhigroupinc.com