PRGSchultz International Inc. (PRGX, Financial) filed Quarterly Report for the period ended 2010-09-30.
Prgschultz International Inc. has a market cap of $140.1 million; its shares were traded at around $5.87 with a P/E ratio of 117.4 and P/S ratio of 0.78. PRGX is in the portfolios of Richard Blum of Blum Capital Partners, Jim Simons of Renaissance Technologies LLC.
Corporate Support SG&A for the quarters ended September 30, 2010 and 2009 includes stock-based compensation charges of $1.2 million and $1.5 million, respectively. The first nine months of 2010 includes $3.0 million of stock-based compensation charges as compared to $2.5 million of stock-based compensation charges included in the same period in 2009.
Interest Expense. Net interest expense was $0.3 million and $0.7 million for the three months ended September 30, 2010 and 2009, respectively. Net interest expense was $2.4 million and $2.2 million for the nine months ended September 30, 2010 and 2009, respectively. Interest expense in the three months ended September 30, 2010 consisted primarily of interest related to the SunTrust Bank term loan under the Companys credit facility, which had an outstanding balance of $12.8 million as of September 30, 2010. Interest expense in the nine months ended September 30, 2010 included a charge of $1.4 million for unamortized deferred loan costs associated with the Companys prior term loan from Ableco LLC which costs were written off in January 2010 in conjunction with the Company entering into a new credit facility with SunTrust Bank (see New Credit Facility below).
Operating Activities. Net cash provided by operating activities was $0.2 million and $7.6 million during the nine months ended September 30, 2010 and 2009, respectively. The $7.4 million decrease in cash provided by operating activities in the nine months ended September 30, 2010 compared to the same period in 2009 was due to an $11.1 million reduction in operating profit partially offset by a $0.6 million increase in the change in operating assets and liabilities from the beginning to the end of the relevant periods. Portions of the reduced operating profit were attributable to increases in noncash charges such as depreciation and amortization expense (a $2.3 million increase) and stock-based compensation (a $0.5 million increase) which do not impact cash generated by operating activities. The $0.6 million increase in the change in operating assets and liabilities in the first nine months of 2010 compared to the same period in 2009 was the result of the timing of certain foreign tax payments and lower payments for other accrued liabilities made during the nine months ended September 30, 2010 compared to the first nine months of 2009. These improvements in cash flow in 2010 were partially offset by smaller reductions in accounts receivable balances in 2010 compared to 2009. Such asset and liability changes are itemized in the Companys Consolidated Statements of Cash Flows included in Item 1 of this Form 10-Q.
Investing Activities and Depreciation and Amortization Expense. Depreciation and amortization expense for the nine months ended September 30, 2010 and 2009 amounted to $6.6 million and $4.3 million, respectively. Net cash used for property and equipment capital expenditures was $5.2 million and $2.1 million during the nine months ended September 30, 2010 and 2009, respectively. Management currently expects this increased level of capital expenditures to continue over the next several quarters as the Company continues to enhance its healthcare audit systems supporting its performance in the CMS RAC program and other healthcare audits and its execution of the Companys strategic initiatives. Capital expenditures are discretionary and changes in operating plans and results could cause management to alter its capital expenditure plans.
Financing Activities and Interest Expense. Net cash used in financing activities was $2.4 million and $4.2 million for the nine months ended September 30, 2010 and 2009, respectively. As described in more detail below, in January 2010, the Company entered into a new $15.0 million term loan, the proceeds of which were used to repay the remaining $14.2 million of outstanding principal from the Ableco LLC term loan and to pay $0.5 million in loan costs incurred in connection with the new SunTrust credit facility. During the first nine months of 2010, the Company made mandatory payments totaling $2.3 million on its new term loan and reduced its capital lease obligations by $0.3 million.
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Prgschultz International Inc. has a market cap of $140.1 million; its shares were traded at around $5.87 with a P/E ratio of 117.4 and P/S ratio of 0.78. PRGX is in the portfolios of Richard Blum of Blum Capital Partners, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Recovery Audit Services Europe/Asia-Pacific SG&A includes FX transaction gains and losses, including the gains and losses related to intercompany balances. During the three months ended September 30, 2010, Recovery Audit Services Europe/Asia-Pacific SG&A recognized $1.2 million of FX transaction gains related to intercompany balances and during the nine months ended September 30, 2010 recognized $0.4 million of FX transaction losses related to intercompany balances. During the three and nine months ended September 30, 2009, Recovery Audit Services Europe/Asia-Pacific SG&A recognized $0.7 million and $1.4 million of FX transaction gains, respectively, related to intercompany balances.Corporate Support SG&A for the quarters ended September 30, 2010 and 2009 includes stock-based compensation charges of $1.2 million and $1.5 million, respectively. The first nine months of 2010 includes $3.0 million of stock-based compensation charges as compared to $2.5 million of stock-based compensation charges included in the same period in 2009.
Interest Expense. Net interest expense was $0.3 million and $0.7 million for the three months ended September 30, 2010 and 2009, respectively. Net interest expense was $2.4 million and $2.2 million for the nine months ended September 30, 2010 and 2009, respectively. Interest expense in the three months ended September 30, 2010 consisted primarily of interest related to the SunTrust Bank term loan under the Companys credit facility, which had an outstanding balance of $12.8 million as of September 30, 2010. Interest expense in the nine months ended September 30, 2010 included a charge of $1.4 million for unamortized deferred loan costs associated with the Companys prior term loan from Ableco LLC which costs were written off in January 2010 in conjunction with the Company entering into a new credit facility with SunTrust Bank (see New Credit Facility below).
Operating Activities. Net cash provided by operating activities was $0.2 million and $7.6 million during the nine months ended September 30, 2010 and 2009, respectively. The $7.4 million decrease in cash provided by operating activities in the nine months ended September 30, 2010 compared to the same period in 2009 was due to an $11.1 million reduction in operating profit partially offset by a $0.6 million increase in the change in operating assets and liabilities from the beginning to the end of the relevant periods. Portions of the reduced operating profit were attributable to increases in noncash charges such as depreciation and amortization expense (a $2.3 million increase) and stock-based compensation (a $0.5 million increase) which do not impact cash generated by operating activities. The $0.6 million increase in the change in operating assets and liabilities in the first nine months of 2010 compared to the same period in 2009 was the result of the timing of certain foreign tax payments and lower payments for other accrued liabilities made during the nine months ended September 30, 2010 compared to the first nine months of 2009. These improvements in cash flow in 2010 were partially offset by smaller reductions in accounts receivable balances in 2010 compared to 2009. Such asset and liability changes are itemized in the Companys Consolidated Statements of Cash Flows included in Item 1 of this Form 10-Q.
Investing Activities and Depreciation and Amortization Expense. Depreciation and amortization expense for the nine months ended September 30, 2010 and 2009 amounted to $6.6 million and $4.3 million, respectively. Net cash used for property and equipment capital expenditures was $5.2 million and $2.1 million during the nine months ended September 30, 2010 and 2009, respectively. Management currently expects this increased level of capital expenditures to continue over the next several quarters as the Company continues to enhance its healthcare audit systems supporting its performance in the CMS RAC program and other healthcare audits and its execution of the Companys strategic initiatives. Capital expenditures are discretionary and changes in operating plans and results could cause management to alter its capital expenditure plans.
Financing Activities and Interest Expense. Net cash used in financing activities was $2.4 million and $4.2 million for the nine months ended September 30, 2010 and 2009, respectively. As described in more detail below, in January 2010, the Company entered into a new $15.0 million term loan, the proceeds of which were used to repay the remaining $14.2 million of outstanding principal from the Ableco LLC term loan and to pay $0.5 million in loan costs incurred in connection with the new SunTrust credit facility. During the first nine months of 2010, the Company made mandatory payments totaling $2.3 million on its new term loan and reduced its capital lease obligations by $0.3 million.
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