Professional Diversity Network, Inc. (NASDAQ:IPDN), (“IPDN” or the
“Company”), a global developer and operator of online and in-person
networks that provides access to networking, training, educational
and employment opportunities for diverse individuals, today
announced its financial results for the quarter ended June 30,
2024.
"The current recruiting market presents
significant challenges. However, our recruitment services
experienced a 3.2% revenue increase during the first two quarters
of this year compared to the same period last year, demonstrating
the effectiveness of our operational restructuring efforts. We
remain committed to strategically targeting industries to establish
ourselves as a leader in the diversity recruitment
sector. RemoteMore has faced a slow demand for IT outsourcing
in the first half of this year but is engaged in discussions with
numerous potential clients. We remain cautiously optimistic about
the possibility of converting some of these discussions into
tangible results. Additionally, our NAPW network's membership
revenue has decreased by 10.9% over the first two quarters. In
response, the management team is actively exploring alternative
revenue sources to sustain and support ongoing operations" stated
Adam He, CEO of Professional Diversity Network, "Overall, we have
successfully reduced our operational costs and expenses by 24.4%
through the implementation of stricter controls during the first
two quarters of this year compared to the same period last
year."
Second Quarter Financial
Highlights:
|
● |
Total consolidated revenues for the three months ended June
30, 2024 decreased $151,000, or 8.2%, as compared to the
same period in the prior year. However, the total pre-tax cost and
expenses for the three months ended June 30,
2024 decreased $1,001,000, or 30.6%. |
|
|
|
|
● |
On June 30, 2024, cash balances
were approximately $619,000 as compared to $628,000 on December 31,
2023. Working capital deficit from continuing operations on June
30, 2024, was approximately $1,512,000 as compared to $1,107,000 on
December 31, 2023. |
Financial Results for the Three Months
Ended June 30, 2024
Revenues
Total revenues for the three months ended June
30, 2024 decreased approximately $151,000, or 8.2%, to
approximately $1,690,000 from approximately $1,841,000 during the
same period in the prior year. The decrease was predominantly
attributable to a reduction in demand for contracted software
development as compared to the same period in the prior
year.
During the three months ended June 30, 2024, our
PDN Network generated approximately $1,153,000 in comparable
revenues compared to approximately $1,102,000 in revenues during
the three months ended June 30, 2023, a increase of
approximately $51,000 or 4.6%.
During the three months ended June 30, 2024,
NAPW Network revenues were approximately $108,000, compared to
revenues of approximately $136,000 during the same period in the
prior year, a decrease of approximately $28,000
or 20.6%.
During the three months ended June 30, 2024,
RemoteMore revenue was approximately $429,000, compared to revenues
of approximately $603,000 during the same period in the prior year,
a decrease of approximately $174,000, or 28.8%.
Costs and Expenses
Cost of revenues during the three months ended
June 30, 2024 was approximately $626,000, a decrease of
approximately $140,000, or 18.3%, from approximately $766,000
during the same period of the prior year. The decrease was
predominantly due to the aforementioned reduction in demand of
contracted software development costs related to RemoteMore and
reduced expenditures related to third-party services.
Sales and marketing expense during the three
months ended June 30, 2024 was approximately $772,000,
a decrease of approximately $344,000, or 30.8%, from
$1,116,000 during the same period in the prior year.
General and administrative expenses during the
three months ended June 30, 2024 decreased by approximately
$425,000, or 34.2%, to approximately $819,000, as compared to
approximately $1,244,000 the same period in the prior year.
Net Loss from Continuing Operations, Net
of Tax
As a result of the factors discussed above,
during the three months ended June 30, 2024, we incurred a net loss
from continuing operations of approximately $586,000,
a decrease in the net loss of approximately $846,000, compared
to a net loss of approximately $1,432,000 during the three months
ended June 30, 2023.
Summary of the
Quarter’s Financial Information
Amounts in following tables are in thousands
except for per share amounts and outstanding shares.
Summary of Financial Position
|
|
June 30, |
|
|
December 31, |
|
|
|
2024 |
|
|
2023 |
|
|
|
|
(in thousands) |
|
|
|
(in thousands) |
|
Current Assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
619 |
|
|
$ |
628 |
|
Other current assets |
|
|
1,419 |
|
|
|
1,740 |
|
Total current assets |
|
$ |
2,038 |
|
|
$ |
2,368 |
|
Long-term assets |
|
|
3,761 |
|
|
|
3,959 |
|
Total Assets |
|
$ |
5,799 |
|
|
$ |
6,327 |
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
$ |
3,550 |
|
|
$ |
3,475 |
|
Total long-term
liabilities |
|
|
240 |
|
|
|
283 |
|
Total liabilities |
|
$ |
3,790 |
|
|
$ |
3,758 |
|
|
|
|
|
|
|
|
|
|
Total stockholders’
equity |
|
|
2,455 |
|
|
|
3,048 |
|
Total stockholders’ equity –
noncontrolling interests |
|
|
(446 |
) |
|
|
(479 |
) |
Total liabilities and
stockholders’ equity |
|
$ |
5,799 |
|
|
$ |
6,327 |
|
|
Summary of Financial Operations
|
|
Six Months Ended |
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
Change |
|
|
Change |
|
|
|
2024 |
|
|
2023 |
|
|
(Dollars) |
|
|
(Percent) |
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Membership fees and related services |
|
$ |
236 |
|
|
$ |
265 |
|
|
$ |
(29 |
) |
|
|
(10.9 |
)% |
Recruitment services |
|
|
2,249 |
|
|
|
2,179 |
|
|
|
70 |
|
|
|
3.2 |
% |
Contracted software development |
|
|
914 |
|
|
|
1,302 |
|
|
|
(388 |
) |
|
|
(29.8 |
)% |
Consumer advertising and marketing solutions |
|
|
18 |
|
|
|
50 |
|
|
|
(32 |
) |
|
|
(64.1 |
)% |
Total revenues |
|
$ |
3,417 |
|
|
$ |
3,796 |
|
|
$ |
(379 |
) |
|
|
(10.0 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
$ |
1,279 |
|
|
$ |
1,840 |
|
|
$ |
(561 |
) |
|
|
(30.5 |
)% |
Sales and marketing |
|
|
1,602 |
|
|
|
1,937 |
|
|
|
(335 |
) |
|
|
(17.3 |
)% |
General and
administrative |
|
|
1,814 |
|
|
|
2,297 |
|
|
|
(483 |
) |
|
|
(21.0 |
)% |
Depreciation and
amortization |
|
|
107 |
|
|
|
280 |
|
|
|
(173 |
) |
|
|
(61.7 |
)% |
Total pre-tax cost and
expenses: |
|
$ |
4,802 |
|
|
$ |
6,354 |
|
|
$ |
(1,552 |
) |
|
|
(24.4 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated net loss from
continuing operations, net of tax |
|
$ |
(1,393 |
) |
|
$ |
(2,541 |
) |
|
$ |
1,148 |
|
|
|
(45.3 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share |
|
$ |
(0.12 |
) |
|
$ |
(0.25 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average outstanding
shares used in computing net loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
11,561,343 |
|
|
|
10,149,410 |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
Change |
|
|
Change |
|
|
|
2024 |
|
|
2023 |
|
|
(Dollars) |
|
|
(Percent) |
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Membership fees and related services |
|
$ |
109 |
|
|
$ |
136 |
|
|
$ |
(27 |
) |
|
|
(19.7 |
)% |
Recruitment services |
|
|
1,145 |
|
|
|
1,076 |
|
|
|
69 |
|
|
|
6.4 |
% |
Contracted software development |
|
|
429 |
|
|
|
604 |
|
|
|
(175 |
) |
|
|
(29.0 |
)% |
Consumer advertising and marketing solutions |
|
|
7 |
|
|
|
25 |
|
|
|
(18 |
) |
|
|
(71.7 |
)% |
Total revenues |
|
$ |
1,690 |
|
|
$ |
1,841 |
|
|
$ |
(151 |
) |
|
|
(8.2 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
$ |
626 |
|
|
$ |
766 |
|
|
$ |
(140 |
) |
|
|
(18.3 |
)% |
Sales and marketing |
|
|
772 |
|
|
|
1,116 |
|
|
|
(344 |
) |
|
|
(30.8 |
)% |
General and
administrative |
|
|
819 |
|
|
|
1,244 |
|
|
|
(425 |
) |
|
|
(34.2 |
)% |
Depreciation and
amortization |
|
|
55 |
|
|
|
147 |
|
|
|
(92 |
) |
|
|
(62.7 |
)% |
Total pre-tax cost and
expenses: |
|
$ |
2,272 |
|
|
$ |
3,273 |
|
|
$ |
(1,001 |
) |
|
|
(30.6 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated net loss from
continuing operations, net of tax |
|
$ |
(586 |
) |
|
$ |
(1,432 |
) |
|
$ |
846 |
|
|
|
(59.1 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share |
|
$ |
(0.05 |
) |
|
$ |
(0.14 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average outstanding
shares used in computing net loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
11,650,830 |
|
|
|
10,387,359 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Cash Flows from Continuing
Operations
|
|
Six Months Ended June 30, |
|
Cash
(used in) provided by continuing operations |
|
2024 |
|
|
2023 |
|
|
|
(in thousands) |
|
Operating activities |
|
$ |
(768 |
) |
|
$ |
(879 |
) |
Investing activities |
|
|
(153 |
) |
|
|
(821 |
) |
Financing activities |
|
|
912 |
|
|
|
2,700 |
|
Net increase in cash and cash
equivalents from continuing operations |
|
$ |
(8 |
) |
|
$ |
1,000 |
|
|
Professional Diversity Network, Inc. and
Subsidiaries
Non-GAAP (Adjusted) Financial
Measures
We believe Adjusted EBITDA provides a meaningful
representation of our operating performance that provides useful
information to investors regarding our financial condition and
results of operations. Adjusted EBITDA is commonly used by
financial analysts and others to measure operating performance.
Furthermore, management believes that this non-GAAP financial
measure may provide investors with additional meaningful
comparisons between current results and results of prior periods as
they are expected to be reflective of our core ongoing business.
However, while we consider Adjusted EBITDA to be an important
measure of operating performance, Adjusted EBITDA and other
non-GAAP financial measures have limitations, and investors should
not consider them in isolation or as a substitute for analysis of
our results as reported under GAAP. Further, Adjusted EBITDA, as we
define it, may not be comparable to EBITDA, or similarly titled
measures, as defined by other companies.
The following non-GAAP financial information in
the tables that follow are reconciled to comparable information
presented using GAAP, derived by adjusting amounts determined in
accordance with GAAP for certain items presented in the
accompanying selected operating statement data.
The adjustments for the three and six
months ended June 30, 2024 relate to stock-based compensation, loss
attributable to noncontrolling interest, depreciation and
amortization, interest and other income and income tax expense
(benefit).
The adjustments for the three and six
months ended June 30, 2023 relate to stock-based compensation, loss
attributable to noncontrolling interest, depreciation and
amortization, interest and other income and income tax expense
(benefit).
|
|
Three Months Ended June 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
(in thousands) |
|
Loss from Continuing Operations, net of tax |
|
$ |
(586 |
) |
|
$ |
(1,432 |
) |
Stock-based compensation |
|
|
26 |
|
|
|
30 |
|
Loss attributable to noncontrolling interest |
|
|
33 |
|
|
|
25 |
|
Depreciation and amortization |
|
|
55 |
|
|
|
147 |
|
Other (expense) income, net |
|
|
- |
|
|
|
- |
|
Income tax expense (benefit) |
|
|
4 |
|
|
|
1 |
|
Adjusted
EBITDA |
|
$ |
(468 |
) |
|
$ |
(1,229 |
) |
|
|
Six Months Ended June 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
(in thousands) |
|
Loss from Continuing Operations |
|
$ |
(1,393 |
) |
|
$ |
(2,541 |
) |
Stock-based compensation |
|
|
110 |
|
|
|
63 |
|
Litigation settlement reserve |
|
|
- |
|
|
|
- |
|
Loss attributable to noncontrolling interest |
|
|
48 |
|
|
|
77 |
|
Depreciation and amortization |
|
|
107 |
|
|
|
280 |
|
Other (expense) income, net |
|
|
2 |
|
|
|
(7 |
) |
Income tax expense (benefit) |
|
|
6 |
|
|
|
(10 |
) |
Adjusted
EBITDA |
|
$ |
(1,120 |
) |
|
$ |
(2,138 |
) |
|
About Professional Diversity
Network
Professional Diversity Network, Inc. (NASDAQ:
IPDN) is a global developer and operator of online and in-person
networks that provides access to networking, training, educational
and employment opportunities for diverse professionals. We operate
subsidiaries in the United States including National Association of
Professional Women (NAPW) and its brand, International Association
of Women (IAW), which is one of the largest, most recognized
networking organizations of professional women in the country,
spanning more than 200 industries and professions. Through an
online platform and our relationship recruitment affinity groups,
we provide our employer clients a means to identify and acquire
diverse talent and assist them with their efforts to comply with
the Equal Employment Opportunity Office of Federal Contract
Compliance Program. Our mission is to utilize the collective
strength of our affiliate companies, members, partners and unique
proprietary platform to be the standard in business diversity
recruiting, networking and professional development for women,
minorities, veterans, LGBTQ+ and disabled persons globally.
Forward-Looking Statements
This press release contains certain
forward-looking statements based on our current expectations,
forecasts and assumptions that involve risks and uncertainties.
This release does not constitute an offer to sell or a solicitation
of offers to buy any securities of any entity. Forward-looking
statements in this release are based on information available to us
as of the date hereof. Our actual results may differ materially
from those stated or implied in such forward-looking statements,
due to risks and uncertainties associated with our business, which
include the risk factors disclosed in our most recently filed
Annual Report on Form 10-K and in our subsequent filings with the
Securities and Exchange Commission. Forward-looking statements
include statements regarding our expectations, beliefs, intentions
or strategies regarding the future and can be identified by
forward-looking words such as “anticipate,” “believe,” “could,”
“estimate,” “expect,” “intend,” “may,” “plan,” “should,” and
“would” or similar words. We assume no obligation to update the
information included in this press release, whether as a result of
new information, future events or otherwise. Our most recently
filed Annual Report on Form 10-K, together with this press release
and the financial information contained herein, are available on
our website, www.ipdn.com. Please click on “Investor
Relations.”
Investor Inquiries:
investors@ipdnusa.com+1 (312) 614-0950Source:
Professional Diversity Network, Inc.Released August 13, 2024
Professional Diversity N... (NASDAQ:IPDN)
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