2022 Revenue Increased 14% Y/Y
NEW YORK, NY / ACCESSWIRE / March 31, 2023 / Recruiter.com Group, Inc. (NASDAQ:RCRT)(NASDAQ:RCRTW) ("Recruiter.com"), a recruiting solutions provider, today announced its financial results for the fourth quarter and full year ending December 31, 2022.
Evan Sohn, CEO of Recruiter.com, remarked, "Throughout 2022, our primary objectives were the seamless integration of acquisitions from the previous year, advancing our distinct product offerings and services, and promoting organic sales growth. In the latter half of the year, we strategically adapted to a complex economic landscape by restructuring our expenses and organizational infrastructure."
"As we progress, our focus is on providing high-margin, technology-driven services that promote near-term profitability while significantly reducing operational expenses. Our recently announced collaboration with Job Mobz and new Recruiter Upskilling platform mark pivotal milestones in our evolution towards innovative 'low- and no-touch' recruiting solutions."
Financial Results for the Full Year Ended December 31, 2022
- Revenue for the fiscal year ended December 31, 2022, totaled $25.4 million compared to $22.2 million for fiscal year 2021, an increase of 14% year-over-year.
- Gross Profit for the fiscal year ended December 31, 2022, totaled $8.7 million compared to $7.3 million for fiscal year 2021, an increase of 19% year-over-year.
- Operating Expenses for the fiscal year ended December 31, 2022, totaled $25.5 million compared to $24.2 million for fiscal year 2021, an increase of 5% year-over-year.
- Net Loss for the fiscal year ended December 31, 2022, totaled $16.5 million compared to $16.3 million for fiscal year 2021, an increase of 1% year-over-year.
- Net Loss per common share for the fiscal year ended December 31, 2022 totaled -$1.22, compared to a loss of -$1.90 for fiscal year 2021, a 36% decrease in loss year-over-year.
Recent Highlights
- Announced a client case study with First, a leading global brand experience agency, which Recruiter.com helped to grow its specialized talent pool.
- Created a ChatGPT content series including a complete ChatGPT training course and ebook that explores the impact of this powerful artificial intelligence technology on talent acquisition and recruiting, and a new learning platform for recruiters at Recruiting Classes.
- Formed a strategic partnership with hireEZ, the award-winning outbound recruiting platform, to provide the recruitment industry with an elevated level of efficiency and effectiveness when hiring talent.
Liquidity and Capital Resources
On December 31, 2022, Recruiter.com had $947 thousand in cash, cash equivalents, and marketable securities. Total Current Assets were $4.4 million. As of December 31, 2022, there were 16,277,764 common shares outstanding.
About Recruiter.com Group, Inc.
Recruiter.com is an on-demand recruiting platform providing flexible talent acquisition solutions that scale from startups to the Fortune 100. With an on-tap network of thousands of recruiting professionals and recruitment marketing automation, Recruiter.com helps businesses solve today's complex hiring challenges.
For investor information, visit https://investors.recruiter.com
Please follow social media channels for additional updates:
● LinkedIn Recruiter Network Group: https://www.linkedin.com/groups/42370/
● LinkedIn Company Page: https://www.linkedin.com/company/1240434
● Twitter Company Page: https://twitter.com/recruiterdotcom
● Facebook Company Page: https://www.facebook.com/RecruiterDotCom
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. The words "predict" "forecast" "believe," "may," "estimate," "continue," "anticipates," "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, 2021. 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.
- Tables Follow -
Recruiter.com Group, Inc. and Subsidiaries
Consolidated Balance Sheets
| December 31, | December 31, | |||||
| 2022 | 2021 | |||||
ASSETS |
||||||
Current assets: |
||||||
Cash |
$ | 946,804 | $ | 2,584,062 | ||
Accounts receivable, net of allowance for doubtful accounts of $1,446,613 and $934,219, respectively |
3,189,816 | 5,650,668 | ||||
Accounts receivable - related parties |
- | 49,033 | ||||
Prepaid expenses and other current assets |
255,548 | 546,079 | ||||
Total current assets |
4,392,168 | 8,829,842 | ||||
Property and equipment, net of accumulated depreciation of $17,210 and $2,982, respectively |
61,340 | 481 | ||||
Intangible assets, net |
2,578,692 | 9,741,832 | ||||
Goodwill |
7,101,084 | 7,718,842 | ||||
Total assets |
$ | 14,133,284 | $ | 26,290,997 | ||
Liabilities and Stockholders' Equity |
||||||
Current liabilities: |
||||||
Accounts payable |
$ | 1,569,814 | $ | 1,121,510 | ||
Accounts payable - related parties |
- | 163,672 | ||||
Accrued expenses |
911,386 | 1,285,339 | ||||
Accrued compensation |
410,957 | 1,551,162 | ||||
Accrued interest |
81,576 | 19,726 | ||||
Contingent consideration for acquisitions |
- | 578,591 | ||||
Deferred payroll taxes |
2,484 | 81,728 | ||||
Other liabilities |
17,333 | 17,333 | ||||
Loans payable - current portion, net of discount |
3,700,855 | 1,712,387 | ||||
Warrant liability for puttable warrants |
600,000 | - | ||||
Refundable deposit on preferred stock purchase |
285,000 | 285,000 | ||||
Deferred revenue |
215,219 | 746,449 | ||||
Total current liabilities |
7,794,624 | 7,562,897 | ||||
Loans payable - long term portion, net of discount |
1,260,343 | 2,637,875 | ||||
Total liabilities |
9,054,967 | 10,200,772 | ||||
Commitments and contingencies (Note 11) |
||||||
Stockholders' Equity: |
||||||
Preferred stock, Series D, $0.0001 par value; 2,000,000 shares authorized; no shares issued and outstanding as of December 31, 2022 and 2021 |
- | - | ||||
Preferred stock, Series E, $0.0001 par value; 775,000 shares authorized; 86,000 shares issued and outstanding as of December 31, 2022 and 2021 |
9 | 9 | ||||
Preferred stock, Series F, $0.0001 par value; 200,000 shares authorized; no shares issued and outstanding as of December 31, 2022 and 2021 |
- | - | ||||
Common stock, $0.0001 par value; 100,000,000 shares authorized; 16,277,764 and 14,566,420 shares issued and outstanding as of December 31, 2022 and 2021, respectively |
1,629 | 1,457 | ||||
Shares to be issued, 587,945 shares as of December 31, 2022 and 2021, respectively |
59 | 59 | ||||
Additional paid-in capital |
74,332,161 | 66,948,340 | ||||
Accumulated deficit |
-69,255,541 | -50,859,640 | ||||
Total stockholders' equity |
5,078,317 | 16,090,225 | ||||
Total liabilities and stockholders' Equity |
$ | 14,133,284 | $ | 26,290,997 | ||
Recruiter.com Group, Inc. and Subsidiaries
Consolidated Statements of Operations
| Year | Year | |||||
| Ended | Ended | |||||
| December 31, | December 31, | |||||
| 2022 | 2021 | |||||
Revenue (including related party revenue of $6,000 and $107,812, respectively) |
$ | 25,372,274 | $ | 22,184,112 | ||
Cost of revenue (including related party costs of $0 and $598,752, respectively) |
16,624,690 | 14,909,389 | ||||
Gross Profit |
8,747,584 | 7,274,723 | ||||
Operating expenses: |
||||||
Sales and marketing |
725,687 | 472,213 | ||||
Product development (including related party expense of $36,181 and $162,102, respectively) |
1,358,675 | 1,152,433 | ||||
Amortization of intangibles |
3,650,206 | 2,741,008 | ||||
Impairment expense |
4,420,539 | 2,530,325 | ||||
General and administrative (including share-based compensation expense of $4,106,040 and $5,400,975, respectively, and related party expenses of $19,825 and $132,253, respectively) |
15,324,941 | 17,323,695 | ||||
Total operating expenses |
25,480,048 | 24,219,674 | ||||
Loss from Operations |
-16,732,464 | -16,944,951 | ||||
Other income (expenses): |
||||||
Interest expense (including related party interest expense of $0 and $30,466, respectively) |
-965,323 | -3,137,050 | ||||
Initial derivative expense |
- | -3,585,983 | ||||
Change in fair value of derivative liability |
- | 7,315,580 | ||||
Gain on debt extinguishment |
1,205,195 | 24,925 | ||||
Grant income |
- | 3,382 | ||||
Net recognized loss on marketable securities |
- | -1,424 | ||||
Other Income (expense) |
17,904 | -9,094 | ||||
Total other income |
257,776 | 610,336 | ||||
Loss before income taxes |
-16,474,688 | -16,334,615 | ||||
Provision for income taxes |
- | - | ||||
Net Loss |
$ | -16,474,688 | $ | -16,334,615 | ||
Deemed dividends |
-1,921,213 | - | ||||
Net loss attributable to common shareholders |
$ | -18,395,901 | $ | -16,334,615 | ||
Net loss per common share - basic and diluted |
$ | -1.22 | $ | -1.9 | ||
Weighted average common shares - basic and diluted |
15,128,513 | 8,601,159 | ||||
Recruiter.com Group, Inc. and Subsidiaries
Consolidated Statements Of Cash Flows
| Year Ended | Year Ended | |||||
| December 31, | December 31, | |||||
| 2022 | 2021 | |||||
Cash Flows From Operating Activities |
||||||
Net loss |
$ | -16,474,688 | $ | -16,334,615 | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||
Depreciation and amortization expense |
3,663,953 | 2,742,162 | ||||
Bad debt expense |
492,906 | 927,847 | ||||
Gain on debt extinguishment |
-1,205,195 | -24,925 | ||||
Equity based compensation expense |
4,106,040 | 5,400,975 | ||||
Recognized loss on marketable securities |
- | 1,424 | ||||
Loan principal paid directly through grant |
- | -2,992 | ||||
Amortization of debt discount and debt costs |
499,031 | 2,503,160 | ||||
Warrant modification expense |
152,244 | 12,624 | ||||
Initial derivative expense |
- | 3,585,983 | ||||
Impairment expense |
4,420,539 | 2,530,325 | ||||
Change in fair value of derivative liability |
- | -7,315,580 | ||||
Factoring discount fee and interest |
179,303 | - | ||||
Gain on sale of intangible assets |
-250,000 | - | ||||
Change in fair value of earn-out liability |
26,604 | 35,294 | ||||
Changes in assets and liabilities: |
||||||
Increase in accounts receivable |
-1,581,422 | -4,690,668 | ||||
Decrease (increase) in accounts receivable - related parties |
49,033 | -7,909 | ||||
Decrease (increase) in prepaid expenses and other current assets |
253,149 | -74,742 | ||||
(Decrease) increase in accounts payable and accrued liabilities |
-594,967 | 1,991,446 | ||||
Decrease in accounts payable and accrued liabilities - related parties |
-163,672 | -746,756 | ||||
Decrease in deferred payroll taxes |
-79,244 | -77,304 | ||||
Increase in other liabilities |
- | 2,840 | ||||
(Decrease) increase in deferred revenue |
-531,231 | 525,767 | ||||
Net cash used in operating activities |
-7,037,617 | -9,015,644 | ||||
Cash Flows From Investing Activities: |
||||||
Capitalized software development costs |
-1,325,491 | - | ||||
Cash paid for acquisitions; net of cash acquired |
- | -2,238,958 | ||||
Proceeds from sale of intangible assets |
1,050,000 | - | ||||
Purchase of property and equipment |
-74,606 | - | ||||
Net cash used in investing activities |
-350,097 | -2,238,958 | ||||
Cash Flows From Financing Activities: |
||||||
Proceeds from loans |
4,077,127 | 250,000 | ||||
Proceeds from convertible notes |
- | 2,153,200 | ||||
Deferred offering costs |
- | -78,038 | ||||
Repayments of loans |
-1,924,332 | -723,611 | ||||
Repayments of sale of future revenues |
- | -10,904 | ||||
Proceeds from factoring agreement |
7,303,537 | - | ||||
Repayments of factoring agreement |
-3,705,876 | - | ||||
Proceeds from common shares and warrants |
- | 13,800,000 | ||||
Offering Costs |
- | -1,651,889 | ||||
Net cash provided by financing activities |
5,750,456 | 13,738,758 | ||||
Net increase (decrease) in cash |
-1,637,258 | 2,484,156 | ||||
Cash, beginning of year |
2,584,062 | 99,906 | ||||
Cash, end of year |
$ | 946,804 | $ | 2,584,062 | ||
Supplemental disclosures of cash flow information: |
||||||
Cash paid during the year for interest |
$ | 256,648 | $ | 240,980 | ||
Cash paid during the year for income taxes |
$ | - | $ | - | ||
Supplemental schedule of non-cash investing and financing activities: |
||||||
Accounts receivable owed under factoring agreement collected directly by factor |
$ | 3,585,013 | $ | - | ||
Purchase price measurement period adjustment to goodwill and accounts receivable |
$ | 35,644 | $ | - | ||
Common shares issued to settle accrued liability |
$ | 409,036 | $ | - | ||
Original issue discount deducted from convertible note proceeds |
$ | - | $ | 342,554 | ||
Debt discount on warrants granted with notes |
$ | 1,632,842 | $ | - | ||
Debt costs deducted from convertible note proceeds |
$ | - | $ | 334,800 | ||
Notes and accrued interest converted to common stock |
$ | - | $ | 4,557,718 | ||
Notes payable and accrued interest exchanged for debentures |
$ | - | $ | 252,430 | ||
Accounts payable paid with common stock |
$ | - | $ | 140,000 | ||
Accrued compensation paid with common stock |
$ | - | $ | 16,425 | ||
Warrant derivative liability extinguished |
$ | - | $ | 10,182,476 | ||
Write off of right-of-use asset and lease liability |
$ | - | $ | 103,953 | ||
Deferred offering costs charged to additional paid-in capital |
$ | - | $ | 78,038 | ||
Common stock issued/to be issued for asset acquisitions |
$ | - | $ | 11,340,284 | ||
Earn-out liability consideration for acquisition |
$ | - | $ | 543,297 | ||
Loans issued as consideration for acquisitions |
$ | - | $ | 4,750,000 | ||
Shares issued for Upsider earn-out liability |
$ | - | $ | 1,394,768 | ||
Warrant derivative liability at inception recorded as debt discount |
$ | - | $ | 2,374,076 | ||
Prepayment of shares issued for services |
$ | - | $ | 237,382 | ||
SOURCE: Recruiter.com Group, Inc.
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