HireQuest Reports Financial Results for Second Quarter 2023 with 25.3% YoY Increase in Total Revenue

GOOSE CREEK, SC — August 10, 2023 — HireQuest, Inc. (Nasdaq:HQI), a national franchisor of direct dispatch, executive search, and commercial staffing services, reported financial results for the second quarter ended June 30, 2023.

Rick Hermanns, HireQuest’s President and Chief Executive Officer, commented, “We are encouraged by our performance this quarter in light of the current economic environment; these results reinforce our confidence in the HireQuest business model which includes over 400 franchisee-owned offices. Late last year, we purchased MRI Network, adding an additional franchise offering for executive search services with over 200 franchise offices in the U.S. and internationally. This was a large acquisition and we incurred certain expenses related to the purchase that we expect will come down over the balance of the year as we drive synergies. We are increasingly well positioned with a diverse mix of staffing options and a strong presence across key geographic regions, and we look forward to continuing to build our position as a leading provider of temporary workforce hiring and professional recruiting solutions.”

Second Quarter 2023 Summary

Franchise royalties increased 20.5% to $8.7 million compared to $7.2 million in the prior year period.

Total revenue increased 12.4% to $9.0 million compared to $8.0 million in the prior year period.

Income from operations decreased 37.4% to $2.7 million compared to $4.3 million in the prior year period.

Selling, general and administrative (“SG&A”) expenses increased 74.5% to $5.6 million compared to $3.2 million in the prior year period, primarily related to expenses from the MRI acquisition and workers’ compensation.

Net income from continuing operations decreased 57.2% to $2.1 million, or $0.15 per diluted share, compared to net income from continuing operations of $4.8 million, or $0.35 per diluted share in the prior year period.

Adjusted EBITDA of $3.9 million compared to $5.8 million in the prior year period.

Year-To-Date 2023 Summary

Franchise royalties increased 30.7% to $18.0 million compared to $13.8 million for the six months ended June 30, 2022.

Total revenue increased 25.3% to $18.8 million compared to $15.0 million in the prior year period.

Income from operations decreased 26.6% to $6.0 million compared to $8.1 million in the prior year period.

SG&A increased 95.1% to $11.5 million compared to $5.9 million in the prior year period.

Net income from continuing operations was $4.4 million, or $0.32 per diluted share, compared to net income of $5.3 million, or $0.39 per diluted share in the prior year period, primarily related to increased expenses including SG&A, and interest and other financing expenses.

Adjusted EBITDA of $8.5 million compared to $10.8 million in the prior year period.

About HireQuest

HireQuest, Inc. is a nationwide franchisor of direct dispatch, executive search, and commercial staffing solutions for HireQuest Direct, HireQuest, Snelling, HireQuest Health, DriverQuest, TradeCorp, MRI, SearchPath Global, and Northbound Executive Search franchised offices across the United States. Through its national network of over 400 franchisee-owned offices across the United States, HireQuest provides employment for approximately 81,000 individuals annually that work for thousands of customers in numerous industries including construction, light industrial, manufacturing, hospitality, clerical, medical, travel, financial services, and event services.

SOURCE HireQuest