Nashville, Tennessee-based HireRight Holdings Corp. (HRT, Financial) posted strong fourth-quarter and full-year 2021 results on Monday, sending its stock price up almost 23% on Tuesday.
HireRight shares finished trading on Monday at $12.54 and were up 26 cents per share in pre-market trading on Tuesday. Shortly before noon, shares were trading around $15.39, up an impressive 22.69%.
HireRight provides comprehensive background screening, verification, identification, monitoring and drug and health screening services for more than 40,000 customers across the globe. The company completed its initial public offering in November 2021.
For the fourth quarter, which ended Dec. 31, revenue was $198.5 million, an increase of 32.3% from the prior-year quarter. Operating income was $7.3 million, up from an operating loss of $0.2 million. The company also reported a net loss of $13 million compared to the year-ago period’s net loss of $19.1 million. Adjusted net income was $22.7 million, an improvement over 2020’s adjusted net loss of $3.2 million. The earnings loss of 18 cents per share was an improvement compared to the loss per share of 33 cents for the 2020 period. Adjusted diluted earnings of 32 cents per share were up from a loss of 6 cents.
For all of 2021, the company's revenue was $730.1 million, a 35.1% increase over 2020. Operating income was $56.7 million, topping the operating loss of $12.1 million a year earlier. The net loss of $21.3 million was better than the net loss of $92.1 million in 2020. Adjusted net income was $75.3 million, better than the adjusted net loss of $0.9 million last year. The loss per share was 35 cents compared to a $1.61 loss in the previous year. The adjusted diluted earnings of $1.24 per share improved from an adjusted per-share loss of 2 cents.
“We completed a transformational year on a high note with record results and growing demand for our services following our initial public offering,” HireRight President and CEO Guy Abramo said. “We grew fourth-quarter revenues 32% over the prior-year period, and both adjusted EBITDA and adjusted EPS more than doubled. The strength of our leadership in this industry continues to be evidenced through our marquee customer base in the health care, technology, financial services and transportation industries. We are trusted by the leading companies in each of those industries to deliver the highest quality, timely and compliant background solutions to protect their businesses.”
Abramo added that the company will be expanding its leadership abroad, with more than 15% of its background screens completed on employees and applicants based outside the U.S. HireRight Holdings’ internationally-driven revenue reached more than $100 million during 2021 and is growing at double-digit rates.
Executives noted that for fiscal 2022, the company is expecting revenue of $805 million to $820 million, while analysts are looking for revenue of $809 million. The company is also expecting adjusted earnings of $1.32 to $1.45 a share, compared to the $1.17 a share analysts have forecast.
The company’s focus for 2022, Abramo continued, is on automation and related margin expansion.
“Our guidance for the new year demonstrates the earnings power of our business and the sharp focus of our entire team on creating meaningful long-term shareholder value," he said.
