Recruiter.com Group Inc. (OTCQB: RCRT), a hiring platform with the world's largest network of recruiters, announced its second-quarter 2020 financial results.
- Achieved 26,013 recruiters on our job recruiter platform, as of June 30, 2020;
- Received a total of $3 million in gross proceeds (excluding fees) from a 12.5% Original Issue Discount Senior Subordinated Secured Convertible Debenture offering, which was oversubscribed;
- Signed key agreements with a Fortune 50 company, a leading managed service platform, and four healthcare companies;
- Signed seven new clients for our "Recruiters On Demand" program;
- Continued build-out and enhancement of our executive team, including hiring Evan Sohn as Chief Executive Officer and Judy Krandel as Chief Financial Officer, while effectively transitioning Miles Jennings to Chief Operating Officer;
- Received multiple major media appearances for the Recruiter Index, Recruiter.com's survey of recruiter sentiment on the job market, hiring, and recruiting demand. Most notably, Evan Sohn appeared on CNBC to discuss the conditions of the job market in the United States.
"During the second quarter, we continued to build our world-class recruiting platform, laying the foundation for significant future revenue growth. Our disruptive business model, matched with our technological prowess, has made recruiting faster, cheaper and easier than ever before,” said Evan Sohn, Chairman and CEO of Recruiter.com.
“We are on track to realize our vision of becoming the leading on-demand professional recruiting solution in the world, well positioned to provide a crucial service to both Fortune 500 companies and small and medium-sized businesses, as the great re-hiring begins."
Second Quarter 2020 Financial Results
- Revenue for the quarter was $1.85 million, representing a 6% decline year-over-year. Initial quarterly revenue expectations were lower at the beginning of the COVID-19 pandemic, but a surge in healthcare and financial service jobs drove improved quarterly sales;
- Net loss in the second quarter of 2019 was $7.94 million, or $(1.64) per share, and included $6.3 million in non-cash expenses primarily a result of the initial derivative expense related to the sale of convertible debentures and a change in the derivative value of warrants due to anti-dilution adjustments. The cash-only loss was $1.64 million, compared to a net loss of $2.28 million, or $(1.27) per share in the corresponding prior-year period;
- Adjusted EBITDA was $(0.55) million, compared to $(0.80) million in the second quarter of 2019.
"We believe we managed our costs very carefully during the quarter and saw a significant improvement in adjusted EBITDA," said Judy Krandel, Chief Financial Officer of Recruiter.com Group Inc. "We are thrilled the investment community supported our business in an oversubscribed offering to help fund our future growth."
About Recruiter.com Group, Inc.
Recruiter.com is a hiring platform for the world's largest network of small and independent recruiters. We empower businesses to recruit specialized talent faster with virtual teams of recruiters and AI job-matching technology.
For investor information, visit https://www.recruiter.com/investors.html.
Please follow social media channels for additional updates:
- LinkedIn Recruiter Network Group: http://www.linkedin.com/groups/42370/
- LinkedIn Company Page: http://www.linkedin.com/company/1240434
- Twitter Company Page: https://twitter.com/recruiterdotcom
- Facebook Company Page: https://www.facebook.com/RecruiterDotCom
Recruiter.com Group, Inc.
Phone: (855) 931-1500
RedChip Companies, Inc.
Phone: (407) 491-4498
Cautionary Note Regarding Forward-Looking Statements:
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including the anticipated improvements of the job market over the short and long term, expected improvement of the job requirement loads, the accuracy of the Recruiter Index as compared with the job market, and the future demand for talent. The words "forecasts" "believe," "may," "estimate," "continue," "anticipate," "intend," "should," "plan," "could," "target," "potential," "is likely," "will," "expect" and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements primarily on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements include continued demand for professional hiring, the accuracy of the Recruiter Index® survey, the impact of the COVID-19 pandemic on the job market and the economy as virus levels are again rising in many states, and the Risk Factors contained within our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2019. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to update any forward-looking statements publicly, whether as a result of new information, future developments or otherwise, except as may be required by law.
The following table presents a reconciliation of net loss to Adjusted EBITDA for the three months ended June 30, 2020, and June 30, 2019:
|Three Months Ended
|Interest expense and finance cost, net||203,874||14,340|
|Depreciation & amortization||159,462||96|
|Bad debt expense||750||-|
|Initial derivative expense||3,340,554||-|
|Change in derivative value due to anti-dilution adjustments||2,642,175||-|
|Loss (gain) on change in fair value of derivatives||339,088||(17,627||)|
|Adjusted EBITDA (Loss)||$||(546,082||)||$||(801,858||)|