- Delivered 7.2% annual revenue growth to $392.3 million in 2021, despite a reduction of $21.9 million of less profitable Non-Strategic Technology Services revenue
- Efficient execution of large training, implementation, and support engagement for a health system in North America drove better than expected fourth quarter results for North America IT Solutions and Services segment with $45.1 million in revenue - more than double prior-year period
- Gross margin expanded 100 basis points in the fourth quarter to 22.3% from increased contributions of IT solutions and services and continued disengagement from lower margin non-strategic technology services
- GAAP operating income for the quarter increased 54.6% with a margin of 4.6%, up 130 basis points
- Fourth quarter GAAP diluted EPS of $0.58, which included a reversal of a tax valuation allowance
- Non-GAAP diluted EPS of $0.25 significantly exceeded guidance on margin improvement
- Transformation strategy delivered annual GAAP operating income increase of 39.6%; Achieved annual GAAP diluted EPS of $0.92 and non-GAAP diluted EPS of $0.64
- Revised reporting structure to new segments: North America and Europe IT Solutions and Services and Non-Strategic Technology Services
BUFFALO, N.Y., Feb. 22, 2022 (GLOBE NEWSWIRE) -- CTG (Nasdaq: CTG) (“Company”), a leading provider of digital IT solutions and services in North America and Western Europe, today reported its financial results for the fourth quarter and year ended December 31, 2021. For reporting purposes, the Company is now disclosing three segments, IT Solutions and Services in each of North America and Europe, and Non-Strategic Technology Services, primarily in North America.
Filip Gydé, CTG President and CEO commented, “Our team finished the year strong, delivering better than expected results in the fourth quarter and doubled revenue year-over-year in our North America IT Solutions and Services segment. Our financial and operational improvements in the fourth quarter were driven by the successful completion of a large training, implementation, and support engagement for a health system in North America. As a result of the increased mix of higher-margin solutions and services revenue in the quarter, we achieved significant improvement in our consolidated operating performance which drove bottom line results that exceeded our guidance for the quarter.”
“While our results will continue to reflect the timing associated with major engagements as we expand our digital solutions and services capabilities, we expect to build a larger foundation of recurring revenue at value-add margins and to disengage from less profitable business.”
Commenting on CTG’s strategy for growth and new reporting structure, Mr. Gydé added, “As part of our strategy to transform CTG into a digital solutions and services company, we are now reporting our results in three segments, which will provide greater visibility into performance across the Company. This new financial reporting structure better reflects the results of our operations, accounting for our increased strategic focus on the higher growth, higher margin solutions and services in North America and Europe. The CTG Board and management team are confident that by executing our transformation strategy, centered on building and delivering digital IT solutions and services, reducing our non-strategic technology services exposure and augmenting our organic efforts with prudent acquisitions, we will be able to deliver long-term value for CTG shareholders.”
Consolidated Fourth Quarter 2021 Review (Narrative compares with prior-year period unless otherwise noted) (unaudited)
| ($ in thousands) | For the Quarter Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 112,389 | $ | 101,348 | $ | 99,320 | $ | 11,041 | 10.9 | % | $ | 2,028 | 2.0 | % | |||||||||||
| GAAP Operating Income | $ | 5,141 | $ | 3,325 | $ | 2,408 | $ | 1,816 | 54.6 | % | $ | 917 | 38.1 | % | |||||||||||
| GAAP Operating Margin | 4.6 | % | 3.3 | % | 2.4 | % | |||||||||||||||||||
| Non-GAAP Operating Income* | $ | 5,352 | $ | 3,581 | $ | 2,975 | $ | 1,771 | 49.5 | % | $ | 606 | 20.4 | % | |||||||||||
| Non-GAAP Operating Margin* | 4.8 | % | 3.5 | % | 3.0 | % | |||||||||||||||||||
| GAAP Net Income | $ | 8,717 | $ | 1,905 | $ | 1,671 | $ | 6,812 | 357.6 | % | $ | 234 | 14.0 | % | |||||||||||
| GAAP Net Margin | 7.8 | % | 1.9 | % | 1.7 | % | |||||||||||||||||||
| Non-GAAP Net Income* | $ | 3,774 | $ | 2,044 | $ | 2,045 | $ | 1,730 | 84.6 | % | $ | (1 | ) | -0.0 | % | ||||||||||
| Non-GAAP Net Income Margin* | 3.4 | % | 2.0 | % | 2.1 | % | |||||||||||||||||||
| Adjusted EBITDA* | $ | 6,513 | $ | 4,935 | $ | 4,209 | $ | 1,578 | 32.0 | % | $ | 726 | 17.2 | % | |||||||||||
| Adjusted EBITDA Margin* | 5.8 | % | 4.9 | % | 4.2 | % | |||||||||||||||||||
*A reconciliation of GAAP to non-GAAP information is included in the financial tables below.
- Fourth quarter revenue reflected increased IT Solutions and Services business in North America, partially offset by the continued disengagement from lower-margin non-strategic business.
- Selling, general and administrative (SG&A) expenses as a percentage of revenue decreased 40 basis points to 17.7%, despite the Company’s continued investment in solutions and business development resources in support of its digital solutions and services strategy.
- Fourth quarter 2021 GAAP net income of $8.7 million, or $0.58 per diluted share, included a $5.1 million, or $0.34 per diluted share, reversal of a valuation allowance against deferred tax assets in the United States. Excluding the tax valuation allowance reversal and acquisition-related expenses, non-GAAP earnings per diluted share were $0.25, up $0.11 or nearly 80%.
Fourth Quarter Segment Performance (unaudited)
North America IT Solutions and Services
| ($ in thousands) | For the Quarter Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 45,075 | $ | 22,440 | $ | 18,987 | $ | 22,635 | 100.9 | % | $ | 3,453 | 18.2 | % | |||||||||||
| Gross profit | $ | 13,262 | $ | 8,058 | $ | 6,943 | $ | 5,204 | 64.6 | % | $ | 1,115 | 16.1 | % | |||||||||||
| Gross margin | 29.4 | % | 35.9 | % | 36.6 | % | |||||||||||||||||||
| Contribution profit | $ | 9,166 | $ | 5,160 | $ | 4,831 | $ | 4,006 | 77.6 | % | $ | 329 | 6.8 | % | |||||||||||
| Contribution margin | 20.3 | % | 23.0 | % | 25.4 | % | |||||||||||||||||||
Europe IT Solutions and Services
| ($ in thousands) | For the Quarter Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 40,081 | $ | 43,857 | $ | 40,214 | $ | (3,776 | ) | -8.6 | % | $ | 3,643 | 9.1 | % | ||||||||||
| Gross profit | $ | 8,805 | $ | 9,699 | $ | 9,119 | $ | (894 | ) | -9.2 | % | $ | 580 | 6.4 | % | ||||||||||
| Gross margin | 22.0 | % | 22.1 | % | 22.7 | % | |||||||||||||||||||
| Contribution profit | $ | 3,262 | $ | 4,470 | $ | 3,740 | $ | (1,208 | ) | -27.0 | % | $ | 730 | 19.5 | % | ||||||||||
| Contribution margin | 8.1 | % | 10.2 | % | 9.3 | % | |||||||||||||||||||
- North America IT Solutions and Services revenue more than doubled in the fourth quarter of 2021 and largely reflected a large training, implementation, and support engagement for a health system in North America completed in the fourth quarter. The change in the Europe IT Solutions and Services segment reflects $1.6 million of unfavorable foreign currency exchange rate (FX) fluctuations. Excluding the unfavorable FX, that segment declined 5.0% primarily due to lower utilization resulting from higher levels of time taken off related to illness from COVID-19.
Non-Strategic Technology Services
| ($ in thousands) | For the Quarter Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 27,233 | $ | 35,051 | $ | 40,119 | $ | (7,818 | ) | -22.3 | % | $ | (5,068 | ) | -12.6 | % | |||||||||
| Gross profit | $ | 2,947 | $ | 3,870 | $ | 4,179 | $ | (923 | ) | -23.9 | % | $ | (309 | ) | -7.4 | % | |||||||||
| Gross margin | 10.8 | % | 11.0 | % | 10.4 | % | |||||||||||||||||||
| Contribution profit | $ | 1,845 | $ | 2,276 | $ | 1,781 | $ | (431 | ) | -18.9 | % | $ | 495 | 27.8 | % | ||||||||||
| Contribution margin | 6.8 | % | 6.5 | % | 4.4 | % | |||||||||||||||||||
Consolidated Full Year 2021 Results (Narrative compares with prior-year period unless otherwise noted) (unaudited)
| ($ in thousands) | For the Year Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 392,285 | $ | 366,091 | $ | 394,170 | $ | 26,194 | 7.2 | % | $ | (28,079 | ) | -7.1 | % | ||||||||||
| GAAP Operating Income | $ | 12,742 | $ | 9,130 | $ | 6,912 | $ | 3,612 | 39.6 | % | $ | 2,218 | 32.1 | % | |||||||||||
| GAAP Operating Margin | 3.2 | % | 2.5 | % | 1.8 | % | |||||||||||||||||||
| Non-GAAP Operating Income* | $ | 14,042 | $ | 11,329 | $ | 9,180 | $ | 2,713 | 23.9 | % | $ | 2,149 | 23.4 | % | |||||||||||
| Non-GAAP Operating Margin* | 3.6 | % | 3.1 | % | 2.3 | % | |||||||||||||||||||
| GAAP Net Income | $ | 13,730 | $ | 7,639 | $ | 4,125 | $ | 6,091 | 79.7 | % | $ | 3,514 | 85.2 | % | |||||||||||
| GAAP Net Margin | 3.5 | % | 2.1 | % | 1.0 | % | |||||||||||||||||||
| Non-GAAP Net Income* | $ | 9,620 | $ | 6,317 | $ | 5,614 | $ | 3,303 | 52.3 | % | $ | 703 | 12.5 | % | |||||||||||
| Non-GAAP Net Income Margin* | 2.5 | % | 1.7 | % | 1.4 | % | |||||||||||||||||||
| Adjusted EBITDA* | $ | 18,081 | $ | 15,692 | $ | 12,515 | $ | 2,389 | 15.2 | % | $ | 3,177 | 25.4 | % | |||||||||||
| Adjusted EBITDA Margin* | 4.6 | % | 4.3 | % | 3.2 | % | |||||||||||||||||||
| * A reconciliation of GAAP to non-GAAP information is included in the financial tables below | |||||||||||||||||||||||||
- The full year results reflect similar impacts as the fourth quarter as the Company continued to shift its revenue mix to more solutions and services-based business. The impact of FX fluctuations in 2021 was favorable $6.8 million compared with $3.0 million in 2020.
- SG&A expense as a percentage of revenue was 18.8% compared with 18.5% in 2020. Included was $1.1 million of acquisition-related expenses and $0.2 million of rebranding expenses in 2021 compared with $1.6 million of acquisition-related expenses and $0.6 million in severance in 2020.
Full Year Segment Performance (unaudited)
| North America IT Solutions and Services | |||||||||||||||||||||||||
| ($ in thousands) | For the Year Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 101,506 | $ | 67,948 | $ | 74,123 | $ | 33,558 | 49.4 | % | $ | (6,175 | ) | -8.3 | % | ||||||||||
| Gross profit | $ | 32,621 | $ | 23,995 | $ | 23,666 | $ | 8,626 | 35.9 | % | $ | 329 | 1.4 | % | |||||||||||
| Gross margin | 32.1 | % | 35.3 | % | 31.9 | % | |||||||||||||||||||
| Contribution profit | $ | 18,738 | $ | 14,627 | $ | 14,668 | $ | 4,111 | 28.1 | % | $ | (41 | ) | -0.3 | % | ||||||||||
| Contribution margin | 18.5 | % | 21.5 | % | 19.8 | % | |||||||||||||||||||
| Europe IT Solutions and Services | |||||||||||||||||||||||||
| ($ in thousands) | For the Year Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 169,341 | $ | 154,847 | $ | 148,108 | $ | 14,494 | 9.4 | % | $ | 6,739 | 4.6 | % | |||||||||||
| Gross profit | $ | 40,311 | $ | 37,818 | $ | 33,269 | $ | 2,493 | 6.6 | % | $ | 4,549 | 13.7 | % | |||||||||||
| Gross margin | 23.8 | % | 24.4 | % | 22.5 | % | |||||||||||||||||||
| Contribution profit | $ | 18,966 | $ | 17,452 | $ | 13,444 | $ | 1,514 | 8.7 | % | $ | 4,008 | 29.8 | % | |||||||||||
| Contribution margin | 11.2 | % | 11.3 | % | 9.1 | % | |||||||||||||||||||
| Non-Strategic Technology Services | |||||||||||||||||||||||||
| ($ in thousands) | For the Year Ended | Change 2020-2021 | Change 2019-2020 | ||||||||||||||||||||||
| Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | $ | % | $ | % | |||||||||||||||||||
| Revenue | $ | 121,438 | $ | 143,296 | $ | 171,939 | $ | (21,858 | ) | -15.3 | % | $ | (28,643 | ) | -16.7 | % | |||||||||
| Gross profit | $ | 13,518 | $ | 15,145 | $ | 18,100 | $ | (1,627 | ) | -10.7 | % | $ | (2,955 | ) | -16.3 | % | |||||||||
| Gross margin | 11.1 | % | 10.6 | % | 10.5 | % | |||||||||||||||||||
| Contribution profit | $ | 8,614 | $ | 8,153 | $ | 7,581 | $ | 461 | 5.7 | % | $ | 572 | 7.5 | % | |||||||||||
| Contribution margin | 7.1 | % | 5.7 | % | 4.4 | % | |||||||||||||||||||
Balance Sheet and Cash Flow
Cash and cash equivalents were $35.6 million, up $2.7 million, or 8.3%, since year-end 2020. Full year net cash provided by operations was $7.4 million and was used in part to fund capital expenditures of $1.9 million.
At the end of 2021, the Company had no outstanding balance on its revolving line of credit facility or any other long-term debt. Days sales outstanding were 67 in the fourth quarter of 2021 compared with 74 in the prior-year period.
2022 Outlook
Mr. Gydé concluded, “As we execute our transformation strategy to build a leading digital solutions and services enterprise for North America and Europe, we are committed to reducing our low margin non-strategic business while building our global solutions and services business. We expect headwinds on revenue in 2022 of approximately $25 to $35 million from the disengagement from non-strategic services and the fourth quarter completion of the large engagement. However, we expect 2022 revenue in the range of $375 million to $395 million. Given our shift to higher margins, we expect earnings to continue to expand, with 2022 non-GAAP diluted earnings per share ranging from $0.64 to $0.72. Our goal over the next two years is to grow adjusted EBITDA margins to 7% to 8% of revenue, representing an increase of approximately 50% to 75% from 2021.”
The Company expects its quarterly performance throughout 2022 to be uneven due to engagement timing, and after a slower start to the year, expects results to improve throughout the year.
Conference Call and Webcast
CTG will hold a conference call today at 11:00 a.m. Eastern Time to discuss the Company’s financial results and business outlook. To access the live call, dial +1 844 291 6362 and enter the access code 1361242. The conference call will also be available via webcast in the Investors section of CTG’s website at www.ctg.com.
A replay of the call will be available from 3:00 p.m. Eastern Time today through February 25, 2022 by dialing +1 866 207 1041 and entering the access code 2423685. The webcast will also be archived on CTG’s website in the Events & Presentations section for at least 90 days following completion of the live conference call.
About CTG
CTG is a leading provider of digital transformation solutions and services that accelerate clients’ project momentum and achievement of their desired IT and business outcomes. We have earned a reputation as a faster and more reliable, results-driven partner focused on improved data-driven decision making, meaningful business performance improvements, new and enhanced customer experiences, and continuous innovation. CTG has operations in North America, South America, Western Europe, and India. The Company regularly posts news and other important information at www.ctg.com.
Reconciliation of GAAP to Non-GAAP Information
The Company has referenced non-GAAP information in this news release. The Company believes that the use of non-GAAP financial information provides useful information to investors and management to gain an overall understanding of its current financial performance and prospects. In addition, management uses non-GAAP financial measures for forecasting, facilitating ongoing operating decisions, and measuring the Company’s overall performance. The Company believes that these non-GAAP measures align closely with its internal measurement processes and are reflective of the Company’s core operating results.
A reconciliation of GAAP to non-GAAP information is included in the financial tables below. The non-GAAP financial information is presented using a consistent methodology from quarter-to-quarter and year-to-year. These measures should be considered in addition to results prepared in accordance with GAAP. Also, these non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. The Company believes that non-GAAP financial measures have limitations in that they do not reflect all amounts associated with the Company's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP financial measures. As such, the non-GAAP financial measures disclosed by the Company should not be considered a substitute for or superior to financial measures calculated in accordance with GAAP, and reconciliations between GAAP and non-GAAP financial measures included in this earnings release should be carefully evaluated.
Forward-Looking Statements
This document contains certain forward-looking statements concerning the Company's current expectations as to future growth, financial outlook, business strategy and performance expectations for 2022 and beyond and statements related to cost control, new business opportunities, financial performance, market demand, and other attributes of the Company, which are protected as forward-looking statements under the Private Securities Litigation Reform Act of 1995. Generally, the words “anticipates”, “believes”, “expects”, “plans”, “may”, “will”, “might,” “would”, “should”, “could,” “seeks”, “estimates”, “anticipates,” “project”, “predict”, “potential”, “currently”, “continue”, “intends”, “outlook”, and other similar words identify forward-looking statements. These statements are based upon the Company's current expectations and assumptions, a review of industry reports, current business conditions in the areas where the Company does business, feedback from existing and potential new clients, a review of current and proposed legislation and governmental regulations that may affect the Company and/or its clients, and other future events or circumstances. Actual results could differ materially from the outlook guidance, expectations, and other forward-looking statements as a result of a number of factors and risks, including among others, the effects of the COVID-19 pandemic and the regulatory, social and business responses thereto on the Company’s business, operations, employees, contractors and clients, the availability to the Company of qualified professional staff, domestic and foreign industry competition for clients and talent, increased bargaining power of large clients, the Company's ability to protect confidential client data, the partial or complete loss of the revenue the Company generates from International Business Machines Corporation (IBM), the ability to integrate businesses when acquired and retain their clients while achieving cost reduction targets, the uncertainty of clients' implementations of cost reduction projects, the effect of healthcare reform and initiatives, the mix of work between solutions and services and non-strategic technology services, currency exchange risks, risks associated with operating in foreign jurisdictions, renegotiations, nullification, or breaches of contracts with clients, vendors, subcontractors or other parties, the change in valuation of capitalized software balances, the impact of current and future laws and government regulation, as well as repeal or modification of such, affecting the information technology (IT) solutions and services and staffing industry, taxes and the Company's operations in particular, industry, economic and political conditions, including fluctuations in demand for IT services, consolidation among the Company's competitors or clients, the need to supplement or change our IT services in response to new offerings in the industry or changes in client requirements for IT products and solutions, actions of activist shareholders, and other factors that involve risk and uncertainty including those listed in the Company's reports filed with the Securities and Exchange Commission. Such forward-looking statements should be read in conjunction with the Company's disclosures set forth in the Company's Form 10-K for the year ended December 31, 2020, including the uncertainties described in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections and other reports, including but not limited to subsequent quarterly reports on Form 10-Q, that may be filed from time to time with the Securities and Exchange Commission and may be obtained through the Securities and Exchange Commission's Electronic Data Gathering and Analysis Retrieval System ("EDGAR") at www.sec.gov. The Company assumes no obligation to update the forward-looking information contained in this release.
COMPUTER TASK GROUP, INCORPORATED (CTG)
Condensed Consolidated Statements of Income
(Unaudited)
(amounts in thousands except per share data)
| For the Quarter Ended | |||||||||||
| December 31, | December 31, | December 31, | |||||||||
| 2021 | 2020 | 2019 | |||||||||
| Revenue | $ | 112,389 | $ | 101,348 | $ | 99,320 | |||||
| Cost of services | 87,375 | 79,721 | 79,079 | ||||||||
| Gross profit | 25,014 | 21,627 | 20,241 | ||||||||
| Selling, general and admin. expenses | 19,873 | 18,302 | 17,833 | ||||||||
| Operating income | 5,141 | 3,325 | 2,408 | ||||||||
| Non-taxable life insurance gain | - | 24 | - | ||||||||
| Gain on sale of building | - | - | - | ||||||||
| Other income (expense), net | (57 | ) | 156 | 125 | |||||||
| Income before income taxes | 5,084 | 3,505 | 2,533 | ||||||||
| Provision (benefit) for income taxes | (3,633 | ) | 1,600 | 862 | |||||||
| Net income | $ | 8,717 | $ | 1,905 | $ | 1,671 | |||||
| Net income per share: | |||||||||||
| Basic | $ | 0.62 | $ | 0.14 | $ | 0.12 | |||||
| Diluted | $ | 0.58 | $ | 0.13 | $ | 0.12 | |||||
| Weighted average shares outstanding: | |||||||||||
| Basic | 14,153 | 13,670 | 13,509 | ||||||||
| Diluted | 15,101 | 14,702 | 14,238 | ||||||||
COMPUTER TASK GROUP, INCORPORATED (CTG)
Condensed Consolidated Statements of Income
(Unaudited)
(amounts in thousands except per share data)
| For the Year Ended | |||||||||||
| December 31, | December 31, | December 31, | |||||||||
| 2021 | 2020 | 2019 | |||||||||
| Revenue | $ | 392,285 | $ | 366,091 | $ | 394,170 | |||||
| Cost of services | 305,835 | 289,133 | 319,135 | ||||||||
| Gross profit | 86,450 | 76,958 | 75,035 | ||||||||
| Selling, general and admin. expenses | 73,708 | 67,828 | 68,123 | ||||||||
| Operating income | 12,742 | 9,130 | 6,912 | ||||||||
| Non-taxable life insurance gain | - | 987 | - | ||||||||
| Gain on sale of building | - | 824 | - | ||||||||
| Other expense, net | (1,005 | ) | (280 | ) | (623 | ) | |||||
| Income before income taxes | 11,737 | 10,661 | 6,289 | ||||||||
| Provision (benefit) for income taxes | (1,993 | ) | 3,022 | 2,164 | |||||||
| Net income | $ | 13,730 | $ | 7,639 | $ | 4,125 | |||||
| Net income per share: | |||||||||||
| Basic | $ | 0.99 | $ | 0.56 | $ | 0.31 | |||||
| Diluted | $ | 0.92 | $ | 0.53 | $ | 0.29 | |||||
| Weighted average shares outstanding: | |||||||||||
| Basic | 13,926 | 13,621 | 13,450 | ||||||||
| Diluted | 14,971 | 14,427 | 13,997 | ||||||||
COMPUTER TASK GROUP, INCORPORATED (CTG)
Condensed Consolidated Balance Sheets
(Unaudited)
(amounts in thousands)
| December 31, | December 31, | ||||||
| 2021 | 2020 | ||||||
| Current Assets: | |||||||
| Cash and cash equivalents | $ | 35,584 | $ | 32,865 | |||
| Accounts receivable, net | 84,252 | 76,892 | |||||
| Other current assets | 2,929 | 3,381 | |||||
| Total current assets | 122,765 | 113,138 | |||||
| Property and equipment, net | 5,242 | 5,515 | |||||
| Operating lease right-of-use assets | 22,132 | 22,116 | |||||
| Cash surrender value | 4,018 | 3,587 | |||||
| Acquired intangibles, net | 7,280 | 9,097 | |||||
| Goodwill | 19,676 | 21,275 | |||||
| Other assets | 7,221 | 1,525 | |||||
| Total Assets | $ | 188,334 | $ | 176,253 | |||
| Current Liabilities: | |||||||
| Accounts payable | $ | 21,150 | $ | 18,784 | |||
| Accrued compensation | 22,534 | 21,968 | |||||
| Operating lease liabilities | 6,444 | 6,427 | |||||
| Other current liabilities | 14,855 | 13,966 | |||||
| Total current liabilities | 64,983 | 61,145 | |||||
| Operating lease liabilities | 15,612 | 15,564 | |||||
| Other liabilities | 13,302 | 20,036 | |||||
| Shareholders' equity | 94,437 | 79,508 | |||||
| Total Liabilities and Shareholders' Equity | $ | 188,334 | $ | 176,253 | |||
COMPUTER TASK GROUP, INCORPORATED (CTG)
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(amounts in thousands)
| For the Year Ended | |||||||||||
| December 31, | December 31, | December 31, | |||||||||
| 2021 | 2020 | 2019 | |||||||||
| Net income | $ | 13,730 | $ | 7,639 | $ | 4,125 | |||||
| Depreciation and amortization expense | 3,172 | 3,309 | 3,268 | ||||||||
| Equity-based compensation expense | 2,640 | 2,483 | 1,748 | ||||||||
| Other operating items | (12,131 | ) | 17,307 | (611 | ) | ||||||
| Net cash provided by operating activities | 7,411 | 30,738 | 8,530 | ||||||||
| Net cash used in investing activities | (2,471 | ) | (4,983 | ) | (11,521 | ) | |||||
| Net cash provided by (used in) financing activities | (1,074 | ) | (5,685 | ) | 1,794 | ||||||
| Effect of exchange rates on cash and cash equivalents | (1,147 | ) | 2,014 | (453 | ) | ||||||
| Net increase (decrease) in cash and cash equivalents | 2,719 | 22,084 | (1,650 | ) | |||||||
| Cash and cash equivalents at beginning of period | 32,865 | 10,781 | 12,431 | ||||||||
| Cash and cash equivalents at end of period | $ | 35,584 | $ | 32,865 | $ | 10,781 | |||||
COMPUTER TASK GROUP, INCORPORATED (CTG)
Segment Information
(Unaudited)
(amounts in thousands)
For reporting purposes, the Company discloses three segments, including IT solutions and services in each of North America and Europe, and Non-Strategic Technology Services, primarily in North America. The Company continues to make investments in business development, including solutions, sales, delivery, and recruiting to drive its digital transformation strategy in both the North America and Europe IT Solutions and Services segments. The Company is not making investments in its Non-Strategic Technology Services segment that includes lower margin staffing services. Contribution profit represents operational profit after consideration of expenses such as sales, solutions, delivery, recruiting and administrative expenses.
| For the Quarter Ended December 31, 2021 | |||||||||||||||||||||||
| North | |||||||||||||||||||||||
| America | Europe | Non-Strategic | |||||||||||||||||||||
| IT Solutions | IT Solutions | Technology | GAAP | Non-GAAP | |||||||||||||||||||
| and Services | and Services | Services | Totals | Non-GAAP* | Totals | ||||||||||||||||||
| Revenue | $ | 45,075 | $ | 40,081 | $ | 27,233 | $ | 112,389 | $ | 112,389 | |||||||||||||
| Cost of services | 31,813 | 31,276 | 24,286 | 87,375 | 87,375 | ||||||||||||||||||
| Gross profit | 13,262 | 8,805 | 2,947 | 25,014 | 25,014 | ||||||||||||||||||
| Gross margin | 29.4 | % | 22.0 | % | 10.8 | % | 22.3 | % | 22.3 | % | |||||||||||||
| Operating expenses | 4,096 | 5,543 | 1,102 | 10,741 | 10,741 | ||||||||||||||||||
| Contribution profit | $ | 9,166 | $ | 3,262 | $ | 1,845 | 14,273 | 14,273 | |||||||||||||||
| Contribution margin | 20.3 | % | 8.1 | % | 6.8 | % | 12.7 | % | 12.7 | % | |||||||||||||
| General and admin. expense | 9,132 | (211 | ) | 8,921 | |||||||||||||||||||
| Operating income | $ | 5,141 | $ | 211 | $ | 5,352 | |||||||||||||||||
| Operating margin | 4.6 | % | 4.8 | % | |||||||||||||||||||
* Non-GAAP costs represent certain acquisition-related expenses
COMPUTER TASK GROUP, INCORPORATED (CTG)
Segment Information
(Unaudited)
(amounts in thousands)
| For the Quarter Ended December 31, 2020 | |||||||||||||||||||||||
| North | |||||||||||||||||||||||
| America | Europe | Non-Strategic | |||||||||||||||||||||
| IT Solutions | IT Solutions | Technology | GAAP | Non-GAAP | |||||||||||||||||||
| and Services | and Services | Services | Totals | Non-GAAP* | Totals | ||||||||||||||||||
| Revenue | $ | 22,440 | $ | 43,857 | $ | 35,051 | $ | 101,348 | $ | 101,348 | |||||||||||||
| Cost of services | 14,382 | 34,158 | 31,181 | 79,721 | 79,721 | ||||||||||||||||||
| Gross profit | 8,058 | 9,699 | 3,870 | 21,627 | 21,627 | ||||||||||||||||||
| Gross margin | 35.9 | % | 22.1 | % | 11.0 | % | 21.3 | % | 21.3 | % | |||||||||||||
| Operating expenses | 2,898 | 5,229 | 1,594 | 9,721 | 9,721 | ||||||||||||||||||
| Contribution profit | $ | 5,160 | $ | 4,470 | $ | 2,276 | 11,906 | 11,906 | |||||||||||||||
| Contribution margin | 23.0 | % | 10.2 | % | 6.5 | % | 11.7 | % | 11.7 | % | |||||||||||||
| General and admin. expense | 8,581 | (256 | ) | 8,325 | |||||||||||||||||||
| Operating income | $ | 3,325 | $ | 256 | $ | 3,581 | |||||||||||||||||
| Operating margin | 3.3 | % | 3.5 | % | |||||||||||||||||||
| For the Quarter Ended December 31, 2019 | |||||||||||||||||||||||
| North | |||||||||||||||||||||||
| America | Europe | Non-Strategic | |||||||||||||||||||||
| IT Solutions | IT Solutions | Technology | GAAP | Non-GAAP | |||||||||||||||||||
| and Services | and Services | Services | Totals | Non-GAAP* | Totals | ||||||||||||||||||
| Revenue | $ | 18,987 | $ | 40,214 | $ | 40,119 | $ | 99,320 | $ | 99,320 | |||||||||||||
| Cost of services | 12,044 | 31,095 | 35,940 | 79,079 | 79,079 | ||||||||||||||||||
| Gross profit | 6,943 | 9,119 | 4,179 | 20,241 | 20,241 | ||||||||||||||||||
| Gross margin | 36.6 | % | 22.7 | % | 10.4 | % | 20.4 | % | 20.4 | % | |||||||||||||
| Operating expenses | 2,112 | 5,379 | 2,398 | 9,889 | 9,889 | ||||||||||||||||||
| Contribution profit | $ | 4,831 | $ | 3,740 | $ | 1,781 | 10,352 | 10,352 | |||||||||||||||
| Contribution margin | 25.4 | % | 9.3 | % | 4.4 | % | 10.4 | % | 10.4 | % | |||||||||||||
| General and admin. expense | 7,944 | (567 | ) | 7,377 | |||||||||||||||||||
| Operating income | $ | 2,408 | $ | 567 | $ | 2,975 | |||||||||||||||||
| Operating margin | 2.4 | % | 3.0 | % | |||||||||||||||||||
* Non-GAAP costs represent certain acquisition-related expenses
COMPUTER TASK GROUP, INCORPORATED (CTG)
Segment Information
(Unaudited)
(amounts in thousands)
| For the Year Ended December 31, 2021 | |||||||||||||||||||||||
| North | |||||||||||||||||||||||
| America | Europe | Non-Strategic | |||||||||||||||||||||
| IT Solutions | IT Solutions | Technology | GAAP | Non-GAAP | |||||||||||||||||||
| and Services | and Services | Services | Totals | Non-GAAP** | Totals | ||||||||||||||||||
| Revenue | $ | 101,506 | $ | 169,341 | $ | 121,438 | $ | 392,285 | $ | 392,285 | |||||||||||||
| Cost of services | 68,885 | 129,030 | 107,920 | 305,835 | 305,835 | ||||||||||||||||||
| Gross profit | 32,621 | 40,311 | 13,518 | 86,450 | 86,450 | ||||||||||||||||||
| Gross margin | 32.1 | % | 23.8 | % | 11.1 | % | 22.0 | % | 22.0 | % | |||||||||||||
| Operating expenses | 13,883 | 21,345 | 4,904 | 40,132 | 40,132 | ||||||||||||||||||
| Contribution profit | $ | 18,738 | $ | 18,966 | $ | 8,614 | $ | 46,318 | 46,318 | ||||||||||||||
| Contribution margin | 18.5 | % | 11.2 | % | 7.1 | % | 11.8 | % | 11.8 | % | |||||||||||||
| General and admin. expense | 33,576 | (1,300 | ) | 32,276 | |||||||||||||||||||
| Operating income | $ | 12,742 | $ | 1,300 | $ | 14,042 | |||||||||||||||||
| Operating margin | 3.2 | % | 3.6 | % | |||||||||||||||||||
** Non-GAAP costs include expenses associated with rebranding and certain acquisition-related expenses
| For the Year Ended December 31, 2020 | |||||||||||||||||||||||
| North | |||||||||||||||||||||||
| America | Europe | Non-Strategic | |||||||||||||||||||||
| IT Solutions | IT Solutions | Technology | GAAP | Non-GAAP | |||||||||||||||||||
| and Services | and Services | Services | Totals | Non-GAAP*** | Totals | ||||||||||||||||||
| Revenue | $ | 67,948 | $ | 154,847 | $ | 143,296 | $ | 366,091 | $ | 366,091 | |||||||||||||
| Cost of services | 43,953 | 117,029 | 128,151 | 289,133 | 289,133 | ||||||||||||||||||
| Gross profit | 23,995 | 37,818 | 15,145 | 76,958 | 76,958 | ||||||||||||||||||
| Gross margin | 35.3 | % | 24.4 | % | 10.6 | % | 21.0 | % | 21.0 | % | |||||||||||||
| Operating expenses | 9,368 | 20,366 | 6,992 | 36,726 | 36,726 | ||||||||||||||||||
| Contribution profit | $ | 14,627 | $ | 17,452 | $ | 8,153 | 40,232 | 40,232 | |||||||||||||||
| Contribution margin | 21.5 | % | 11.3 | % | 5.7 | % | 11.0 | % | 11.0 | % | |||||||||||||
| General and admin. expense | 31,102 | (2,199 | ) | 28,903 | |||||||||||||||||||
| Operating income | $ | 9,130 | $ | 2,199 | $ | 11,329 | |||||||||||||||||
| Operating margin | 2.5 | % | 3.1 | % | |||||||||||||||||||
*** Non-GAAP costs include severance and certain acquisition-related expenses
COMPUTER TASK GROUP, INCORPORATED (CTG)
Segment Information
(Unaudited)
(amounts in thousands)
| For the Year Ended December 31, 2019 | |||||||||||||||||||||||
| North | |||||||||||||||||||||||
| America | Europe | Non-Strategic | |||||||||||||||||||||
| IT Solutions | IT Solutions | Technology | GAAP | Non-GAAP | |||||||||||||||||||
| and Services | and Services | Services | Totals | Non-GAAP* | Totals | ||||||||||||||||||
| Revenue | $ | 74,123 | $ | 148,108 | $ | 171,939 | $ | 394,170 | $ | 394,170 | |||||||||||||
| Cost of services | 50,457 | 114,839 | 153,839 | 319,135 | 319,135 | ||||||||||||||||||
| Gross profit | 23,666 | 33,269 | 18,100 | 75,035 | 75,035 | ||||||||||||||||||
| Gross margin | 31.9 | % | 22.5 | % | 10.5 | % | 19.0 | % | 19.0 | % | |||||||||||||
| Operating expenses | 8,998 | 19,825 | 10,519 | 39,342 | 39,342 | ||||||||||||||||||
| Contribution profit | $ | 14,668 | $ | 13,444 | $ | 7,581 | $ | 35,693 | 35,693 | ||||||||||||||
| Contribution margin | 19.8 | % | 9.1 | % | 4.4 | % | 9.1 | % | 9.1 | % | |||||||||||||
| General and admin. expense | 28,781 | (2,269 | ) | 26,512 | |||||||||||||||||||
| Operating income | $ | 6,912 | $ | 2,269 | $ | 9,181 | |||||||||||||||||
| Operating margin | 1.8 | % | 2.3 | % | |||||||||||||||||||
| * Non-GAAP costs represent certain acquisition-related expenses | |||||||||||||||||||||||
COMPUTER TASK GROUP, INCORPORATED (CTG)
Supplemental Financial Information
(Unaudited)
| Year | Year | |||||||||||||||||||||||||||
| For the Quarter Ended | Ended | Ended | ||||||||||||||||||||||||||
| Dec. | Mar. | Jun. | Sept. | Dec. | Dec. | Dec. | ||||||||||||||||||||||
| 2020 | 2021 | 2021 | 2021 | 2021 | 2021 | 2020 | ||||||||||||||||||||||
| Revenue (in millions) | ||||||||||||||||||||||||||||
| Revenue | $ | 101.348 | $ | 97.129 | $ | 92.164 | $ | 90.603 | $ | 112.389 | $ | 392.285 | $ | 366.091 | ||||||||||||||
| Foreign Currency Impact | $ | 3.088 | $ | 3.981 | $ | 3.921 | $ | 0.453 | $ | (1.571 | ) | $ | 6.784 | $ | 3.027 | |||||||||||||
| Revenue By Geography | ||||||||||||||||||||||||||||
| North America | 55.2 | % | 51.0 | % | 51.0 | % | 55.5 | % | 63.4 | % | 55.7 | % | 55.8 | % | ||||||||||||||
| Europe | 44.8 | % | 49.0 | % | 49.0 | % | 44.5 | % | 36.6 | % | 44.3 | % | 44.2 | % | ||||||||||||||
| Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||
| Revenue by Vertical Market | ||||||||||||||||||||||||||||
| Technology Service Providers | 30 | % | 31 | % | 29 | % | 28 | % | 20 | % | 27 | % | 31 | % | ||||||||||||||
| Healthcare | 17 | % | 15 | % | 15 | % | 18 | % | 36 | % | 21 | % | 15 | % | ||||||||||||||
| Financial Services | 16 | % | 17 | % | 17 | % | 18 | % | 13 | % | 16 | % | 16 | % | ||||||||||||||
| Manufacturing | 12 | % | 12 | % | 13 | % | 12 | % | 10 | % | 12 | % | 14 | % | ||||||||||||||
| Energy | 5 | % | 6 | % | 6 | % | 5 | % | 4 | % | 5 | % | 6 | % | ||||||||||||||
| General Markets | 20 | % | 19 | % | 20 | % | 19 | % | 17 | % | 19 | % | 18 | % | ||||||||||||||
| Total | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||
| Operating Margins | ||||||||||||||||||||||||||||
| GAAP Operating Margin | 3.3 | % | 2.2 | % | 3.0 | % | 3.0 | % | 4.6 | % | 3.2 | % | 2.5 | % | ||||||||||||||
| Non-GAAP Operating Margin | 3.5 | % | 2.8 | % | 3.2 | % | 3.3 | % | 4.8 | % | 3.6 | % | 3.1 | % | ||||||||||||||
| Other Information (in millions except Billable Days and EPS) | ||||||||||||||||||||||||||||
| Billable Days | 67 | 65 | 64 | 63 | 63 | 255 | 256 | |||||||||||||||||||||
| Net Income | $ | 1.905 | $ | 1.508 | $ | 1.833 | $ | 1.672 | $ | 8.717 | $ | 13.730 | $ | 7.639 | ||||||||||||||
| GAAP Diluted EPS* | $ | 0.13 | $ | 0.10 | $ | 0.12 | $ | 0.11 | $ | 0.58 | $ | 0.92 | $ | 0.53 | ||||||||||||||
| Non-GAAP Diluted EPS* | $ | 0.14 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.25 | $ | 0.64 | $ | 0.44 | ||||||||||||||
| Adjusted EBITDA | $ | 4.9 | $ | 3.7 | $ | 4.1 | $ | 3.8 | $ | 6.5 | $ | 18.1 | $ | 15.7 | ||||||||||||||
| * 2020 GAAP Diluted EPS includes a $0.08 tax benefit from a change in legislation, and 2021 fourth quarter and full year GAAP | ||||||||||||||||||||||||||||
| Diluted EPS includes a $0.34 benefit from a reversal of a valuation allowance against deferred tax assets in the United States | ||||||||||||||||||||||||||||
| Balance Sheet Information (in millions except DSO) | ||||||||||||||||||||||||||||
| Cash less Debt, Net | $ | 32.9 | $ | 33.5 | $ | 29.2 | $ | 31.0 | $ | 35.6 | ||||||||||||||||||
| Working Capital | $ | 52.0 | $ | 53.3 | $ | 54.5 | $ | 56.6 | $ | 57.8 | ||||||||||||||||||
| DSO | 74 | 71 | 81 | 82 | 67 | |||||||||||||||||||||||
COMPUTER TASK GROUP, INCORPORATED (CTG)
(Unaudited)
The non-GAAP information below excludes gains from non-taxable life insurance and from the sale of a building, and expenses associated with rebranding, severance, certain acquisition-related expenses, and the reversal of a tax valuation allowance. The acquisition-related expenses consist of amortization of intangible assets and changes in the value of earn-out payments upon the achievement of certain financial targets from the Company’s recent acquisitions.
Reconciliation of GAAP to non-GAAP Operating Income
| Year | Year | |||||||||||||||||||||||||||
| For the Quarter Ended | Ended | Ended | ||||||||||||||||||||||||||
| Dec. | Mar. | Jun. | Sept. | Dec. | Dec. | Dec. | ||||||||||||||||||||||
| (in millions) | 2020 | 2021 | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||||||||
| GAAP Operating Income | $ | 3.325 | $ | 2.098 | $ | 2.801 | $ | 2.702 | $ | 5.141 | $ | 12.742 | $ | 9.130 | ||||||||||||||
| Acquisition-related expenses | 0.256 | 0.395 | 0.165 | 0.280 | 0.211 | 1.051 | 1.622 | |||||||||||||||||||||
| Rebranding expenses | - | 0.249 | - | - | - | 0.249 | - | |||||||||||||||||||||
| Severance | - | - | - | - | - | - | 0.577 | |||||||||||||||||||||
| Non-GAAP Operating Income | $ | 3.581 | $ | 2.742 | $ | 2.966 | $ | 2.982 | $ | 5.352 | $ | 14.042 | $ | 11.329 | ||||||||||||||
Reconciliation of GAAP to non-GAAP Operating Margin
| Year | Year | ||||||||||||||||||||
| For the Quarter Ended | Ended | Ended | |||||||||||||||||||
| Dec. | Mar. | Jun. | Sept. | Dec. | Dec. | Dec. | |||||||||||||||
| 2020 | 2021 | 2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
| GAAP Operating Margin | 3.3 | % | 2.2 | % | 3.0 | % | 3.0 | % | 4.6 | % | 3.2 | % | 2.5 | % | |||||||
| Acquisition-related expenses | 0.2 | % | 0.4 | % | 0.2 | % | 0.3 | % | 0.2 | % | 0.3 | % | 0.4 | % | |||||||
| Rebranding expenses | - | 0.2 | % | - | - | - | 0.1 | % | - | ||||||||||||
| Severance | - | - | - | - | - | - | 0.2 | % | |||||||||||||
| Non-GAAP Operating Margin | 3.5 | % | 2.8 | % | 3.2 | % | 3.3 | % | 4.8 | % | 3.6 | % | 3.1 | % | |||||||
Reconciliation of GAAP to non-GAAP Net Income
| For the Quarter Ended | For the Year Ended | |||||||||||||||||||||||||||||||||||
| Dec. | Dec. | Mar. | Jun. | Sept. | Dec. | Dec. | Dec. | Dec. | ||||||||||||||||||||||||||||
| (in millions) | 2019 | 2020 | 2021 | 2021 | 2021 | 2021 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||||
| GAAP Net Income | $ | 1.671 | $ | 1.905 | $ | 1.508 | $ | 1.833 | $ | 1.672 | $ | 8.717 | $ | 13.730 | $ | 7.639 | $ | 4.125 | ||||||||||||||||||
| Acquisition-related expenses | 0.374 | 0.139 | 0.306 | 0.119 | 0.216 | 0.151 | 0.792 | 0.945 | 1.490 | |||||||||||||||||||||||||||
| Rebranding expenses | - | - | 0.192 | - | - | - | 0.192 | - | - | |||||||||||||||||||||||||||
| Reversal of tax valuation allowance | - | - | - | - | - | (5.094 | ) | (5.094 | ) | - | - | |||||||||||||||||||||||||
| Non-taxable life insurance gain | - | - | - | - | - | - | - | (0.987 | ) | - | ||||||||||||||||||||||||||
| Gain on sale of building | - | - | - | - | - | - | - | (0.464 | ) | - | ||||||||||||||||||||||||||
| Change in tax legislation | - | - | - | - | - | - | - | (1.141 | ) | - | ||||||||||||||||||||||||||
| Severance | - | - | - | - | - | - | - | 0.325 | - | |||||||||||||||||||||||||||
| Non-GAAP Net Income | $ | 2.045 | $ | 2.044 | $ | 2.006 | $ | 1.952 | $ | 1.888 | $ | 3.774 | $ | 9.620 | $ | 6.317 | $ | 5.615 | ||||||||||||||||||
COMPUTER TASK GROUP, INCORPORATED (CTG)
(Unaudited)
Reconciliation of GAAP to non-GAAP Diluted Earnings per Share (EPS)
| Year | Year | |||||||||||||||||||||||||||
| For the Quarter Ended | Ended | Ended | ||||||||||||||||||||||||||
| Dec. | Mar. | Jun. | Sept. | Dec. | Dec. | Dec. | ||||||||||||||||||||||
| 2020 | 2021 | 2021 | 2021 | 2021 | 2021 | 2020 | ||||||||||||||||||||||
| GAAP Diluted EPS | $ | 0.13 | $ | 0.10 | $ | 0.12 | $ | 0.11 | $ | 0.58 | $ | 0.92 | $ | 0.53 | ||||||||||||||
| Acquisition-related expenses | 0.01 | 0.02 | 0.01 | 0.02 | 0.01 | 0.05 | 0.07 | |||||||||||||||||||||
| Rebranding expenses | - | 0.01 | - | - | - | 0.01 | - | |||||||||||||||||||||
| Reversal of tax valuation allowance | - | - | - | - | (0.34 | ) | (0.34 | ) | - | |||||||||||||||||||
| Non-taxable life insurance gain | - | - | - | - | - | - | (0.07 | ) | ||||||||||||||||||||
| Gain on sale of building | - | - | - | - | - | - | (0.03 | ) | ||||||||||||||||||||
| Change in tax legislation | - | - | - | - | - | - | (0.08 | ) | ||||||||||||||||||||
| Severance | - | - | - | - | - | - | 0.02 | |||||||||||||||||||||
| Non-GAAP Diluted EPS | $ | 0.14 | $ | 0.13 | $ | 0.13 | $ | 0.13 | $ | 0.25 | $ | 0.64 | $ | 0.44 | ||||||||||||||
Reconciliation of Net Income to Adjusted EBITDA, which includes earnings before interest (including amortization of deferred debt financing costs), taxes, depreciation and amortization, equity-based compensation, rebranding expenses, non-taxable life insurance gain, and acquisition-related expenses.
| For the Quarter Ended | For the Year Ended | |||||||||||||||||||||||||||||||||||
| Dec. | Dec. | Mar. | Jun. | Sept. | Dec. | Dec. | Dec. | Dec. | ||||||||||||||||||||||||||||
| (in millions) | 2019 | 2020 | 2021 | 2021 | 2021 | 2021 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||||
| Net Income | $ | 1.671 | $ | 1.905 | $ | 1.508 | $ | 1.833 | $ | 1.672 | $ | 8.717 | $ | 13.730 | $ | 7.639 | $ | 4.125 | ||||||||||||||||||
| Taxes | 0.862 | 1.600 | 0.440 | 0.712 | 0.488 | (3.633 | ) | (1.993 | ) | 3.022 | 2.164 | |||||||||||||||||||||||||
| Interest | 0.056 | 0.065 | 0.036 | 0.161 | 0.112 | 0.100 | 0.409 | 0.274 | 0.346 | |||||||||||||||||||||||||||
| Depreciation and amortization | 0.846 | 0.733 | 0.854 | 0.831 | 0.766 | 0.721 | 3.172 | 3.309 | 3.268 | |||||||||||||||||||||||||||
| Equity-based compensation expense | 0.587 | 0.678 | 0.590 | 0.682 | 0.702 | 0.666 | 2.640 | 2.483 | 1.748 | |||||||||||||||||||||||||||
| Non-taxable life insurance gain | - | (0.024 | ) | - | - | - | - | - | (0.987 | ) | - | |||||||||||||||||||||||||
| Other | 0.187 | (0.022 | ) | 0.297 | (0.123 | ) | 0.007 | (0.058 | ) | 0.123 | (0.048 | ) | 0.864 | |||||||||||||||||||||||
| Adjusted EBITDA | $ | 4.209 | $ | 4.935 | $ | 3.725 | $ | 4.096 | $ | 3.747 | $ | 6.513 | $ | 18.081 | $ | 15.692 | $ | 12.515 | ||||||||||||||||||
| Adjusted EBITDA Margin | 4.2 | % | 4.9 | % | 3.8 | % | 4.4 | % | 4.1 | % | 5.8 | % | 4.6 | % | 4.3 | % | 3.2 | % | ||||||||||||||||||
CTG news releases are available at www.ctg.com.
