CBIZ REPORTS FOURTH-QUARTER AND FULL-YEAR 2021 RESULTS
CBIZ reported strong financial results for Q4 and full-year 2021, with revenues rising 15% to $242.8 million in Q4 and 14.6% to $1.1 billion for the year. However, the company faced a loss from continuing operations in Q4 of $9.6 million, compared to a minimal loss in 2020. Adjusted diluted EPS increased by 16.9% to $1.66. The company made strategic acquisitions, including Marks Paneth, expected to generate $138 million in 2022 revenue. For 2022, CBIZ forecasts revenue growth of 19% to 21%, with fully diluted EPS anticipated to reach $1.89 to $1.93.
- Revenue growth of 15% in Q4 and 14.6% for the full year 2021.
- Strategic acquisitions expected to contribute significantly to revenue in 2022.
- Adjusted diluted EPS increased by 16.9% to $1.66 for 2021.
- 2022 revenue growth forecast of 19% to 21%.
- Loss from continuing operations of $9.6 million in Q4 2021, compared to a loss of $0.1 million in Q4 2020.
CLEVELAND, Feb. 17, 2022 /PRNewswire/ -- CBIZ, Inc., (NYSE: CBZ) ("CBIZ", or the "Company"), a leading provider of financial, insurance and advisory services, today announced fourth-quarter and full-year results for the period ended December 31, 2021.
For the 2021 fourth quarter, CBIZ recorded revenue of
For the full year ended December 31, 2021, CBIZ recorded revenue of
As previously announced on June 30, 2021, the Company reached a settlement agreement with the University of Pittsburgh Medical Center ("UPMC") related to claims arising from a lawsuit filed in connection with actuarial services provided by a former employee in 2013. Net of insurance proceeds, the pretax charge related to this settlement in the second quarter of 2021 was
As previously announced on January 10, 2022, the Company acquired Marks Paneth, a New York City-based accounting firm. This transaction is expected to add approximately
Reconciliations for adjusted diluted EPS and adjusted EBITDA to the most directly comparable GAAP measures can be found in the tables of this release.
For the full year ended December 31, 2021, the Company repurchased a total of 3.0 million shares of its common stock on the open market. The balance outstanding on the Company's unsecured credit facility on December 31, 2021, was
Jerry Grisko, CBIZ President and Chief Executive Officer, said, "2021 was a year to be celebrated at CBIZ. As we marked our 25-year anniversary, I am proud to report exceptional results for the past year with record growth across nearly every major service line. In addition to continued strong demand for the core, essential, services that we provide to our clients regardless of business climate, we experienced very high demand for our more specialty and project-based advisory services as well, an increasing trend that demonstrates the optimistic outlook of our clients as they continue to focus on growth."
"2021 also proved to be an important year for our strategic acquisition activity as we capitalized on a full and expanding pipeline of opportunities starting early in the year," Grisko continued. "We closed six acquisitions adding approximately
"Coming off such a strong year, and with the completion of our latest acquisition, we expect another year of solid growth in 2022," Grisko concluded.
2022 Outlook
- The Company expects revenue to grow within a range of
19% to21% over the prior year. - Although a number of factors may impact the tax rate, the Company expects an effective tax rate of approximately
25% . - The Company expects a weighted average fully diluted share count of approximately 53.0 to 53.5 million shares.
- The Company expects GAAP fully diluted earnings per share from continuing operations to grow within a range of
43% to46% , to$1.89 to$1.93 per share over the$1.32 per share reported for 2021. - The Company expects adjusted fully diluted earnings per share from continuing operations to grow within a range of
20% to22% , to$1.99 to$2.03 per share over the adjusted$1.66 per share reported for 2021.
Conference Call
CBIZ will host a conference call at 11:00 a.m. (ET) today to discuss its results. The call will be webcast and an archived replay will be available at https://cbiz.gcs-web.com/investor-overview. Participants may register at https://dpregister.com/sreg/10163760/f162c4adc0.
About CBIZ
CBIZ is a leading provider of financial, insurance and advisory services to businesses throughout the United States. Financial services include accounting, tax, government health care consulting, transaction advisory, risk advisory, and valuation services. Insurance services include employee benefits consulting, retirement plan consulting, property and casualty insurance, payroll, and human capital consulting. With more than 100 offices in 32 states, CBIZ is one of the largest accounting and insurance brokerage providers in the U.S. For more information, visit www.cbiz.com.
Forward-Looking Statements
Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include, but are not limited to, the impact of COVID-19 on the Company's business and operations and those of our clients; the Company's ability to adequately manage and sustain its growth; the Company's dependence on the current trend of outsourcing business services; the Company's dependence on the services of its CEO and other key employees; competitive pricing pressures; general business and economic conditions; and changes in governmental regulation and tax laws affecting the Company's insurance business or its business services operations. A more detailed description of such risks and uncertainties may be found in the Company's filings with the Securities and Exchange Commission at www.sec.gov.
CBIZ, INC. FINANCIAL HIGHLIGHTS (UNAUDITED) THREE MONTHS ENDED DECEMBER 31, 2021 AND 2020 (In thousands, except percentages and per share data)
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Three Months Ended December 31, | ||||||||
2021 | % | 2020 | % | |||||
Revenue | ||||||||
Operating expenses (1) | 246,402 | 101.5 | 211,748 | 100.3 | ||||
Gross loss | (3,574) | (1.5) | (638) | (0.3) | ||||
Corporate general and administrative expenses (1) | 14,816 | 6.1 | 13,078 | 6.2 | ||||
Operating loss | (18,390) | (7.6) | (13,716) | (6.5) | ||||
Other (expense) income: | ||||||||
Interest expense | (1,016) | (0.4) | (816) | (0.4) | ||||
Loss on sale of operations, net | (390) | (0.2) | (587) | (0.3) | ||||
Other income, net (1) (2) | 6,212 | 2.6 | 13,050 | 6.2 | ||||
Total other income, net | 4,806 | 2.0 | 11,647 | 5.5 | ||||
Loss from continuing operations before income tax benefit | (13,584) | (5.6) | (2,069) | (1.0) | ||||
Income tax benefit | (3,971) | (1,979) | ||||||
Loss from continuing operations | (9,613) | (4.0) | (90) | — | ||||
Loss from operations of discontinued businesses, net of tax | (7) | (4) | ||||||
Net loss | $ (9,620) | (4.0)% | $ (94) | —% | ||||
Diluted loss per share: | ||||||||
Continuing operations | $ (0.19) | $ — | ||||||
Discontinued operations | — | — | ||||||
Net loss | $ (0.19) | $ — | ||||||
Diluted weighted average common shares outstanding | 51,899 | 54,039 | ||||||
Other data from continuing operations: | ||||||||
Adjusted EBITDA (3) | $ (5,021) | $ 5,196 | ||||||
(1) | CBIZ sponsors a deferred compensation plan, under which a CBIZ employee's compensation deferral is held in a rabbi trust and |
Income and expenses related to the deferred compensation plan for the three months ended December 31, 2021, and 2020 are as follows (in thousands): |
Three Months Ended December 31, | ||||||||
2021 | % of Revenue | 2020 | % of Revenue | |||||
Operating expenses | $ 6,152 | $ 11,010 | ||||||
Corporate general and administrative expenses | 908 | 1,244 | ||||||
Other income, net | 7,060 | 12,254 | ||||||
Excluding the impact of the above-mentioned income and expenses related to the deferred compensation plan, the operating results for the three months ended December 31, 2021, and 2020 are |
Three Months Ended December 31, | |||||||||||||||
2021 | 2020 | ||||||||||||||
As | Deferred | Adjusted | % of | As | Deferred | Adjusted | % of | ||||||||
Gross margin | $ (3,574) | $ 6,152 | $ 2,578 | $ (638) | $ 11,010 | $ 10,372 | |||||||||
Operating income (expense) | (18,390) | 7,060 | (11,330) | (4.7)% | (13,716) | 12,254 | (1,462) | (0.7)% | |||||||
Other income (expense), net | 6,212 | (7,060) | (848) | (0.3)% | 13,050 | (12,254) | 796 | ||||||||
Loss from continuing operations | (13,584) | — | (13,584) | (5.6)% | (2,069) | — | (2,069) | (1.0)% | |||||||
(2) | Included in "Other income, net" for the three months ended December 31, 2021 and 2020, is expense of |
(3) | Refer to the financial highlights tables for a reconciliation of Non-GAAP financial measures to the most directly comparable GAAP financial measure, and for additional information as to the usefulness of the Non-GAAP financial measures to shareholders and investors. |
CBIZ, INC. FINANCIAL HIGHLIGHTS (UNAUDITED) TWELVE MONTHS ENDED DECEMBER 31, 2021 AND 2020 (In thousands, except percentages and per share data)
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Twelve Months Ended December 31, | ||||||||
2021 | % | 2020 | % | |||||
Revenue | ||||||||
Operating expenses (1) | 945,635 | 85.6 | 825,351 | 85.6 | ||||
Gross margin | 159,290 | 14.4 | 138,546 | 14.4 | ||||
Corporate general and administrative expenses (1) | 56,150 | 5.1 | 46,066 | 4.8 | ||||
Legal settlement, net | 30,468 | 2.7 | — | — | ||||
Operating income | 72,672 | 6.6 | 92,480 | 9.6 | ||||
Other income (expense): | ||||||||
Interest expense | (3,868) | (0.4) | (4,983) | (0.5) | ||||
Gain (loss) on sale of operations, net | 5,995 | 0.5 | (509) | (0.1) | ||||
Other income, net (1) (2) | 18,241 | 1.7 | 16,500 | 1.7 | ||||
Total other income, net | 20,368 | 1.8 | 11,008 | 1.1 | ||||
Income from continuing operations before income tax expense | 93,040 | 8.4 | 103,488 | 10.7 | ||||
Income tax expense | 22,129 | 25,141 | ||||||
Income from continuing operations | 70,911 | 6.4 | 78,347 | 8.1 | ||||
Loss from operations of discontinued businesses, net of tax | (24) | (48) | ||||||
Net income | $ 70,887 | $ 78,299 | ||||||
Diluted income per share: | ||||||||
Continuing operations | $ 1.32 | $ 1.42 | ||||||
Discontinued operations | — | (0.01) | ||||||
Net income | $ 1.32 | $ 1.41 | ||||||
Diluted weighted average common shares outstanding | 53,723 | 55,359 | ||||||
Other data from continuing operations: | ||||||||
Adjusted EBITDA (3) | $ 148,459 | |||||||
Adjusted EPS (3) | $ 1.66 | $ 1.42 | ||||||
(1) | CBIZ sponsors a deferred compensation plan, under which a CBIZ employee's compensation deferral is held in a rabbi trust and |
Income and expenses related to the deferred compensation plan for the twelve months ended December 31, 2021, and 2020 are as follows (in thousands): |
Twelve Months Ended December 31, | ||||||||
2021 | % of Revenue | 2020 | % of Revenue | |||||
Operating expenses | $ 17,317 | $ 13,806 | ||||||
Corporate general and administrative expenses | 2,168 | 1,587 | ||||||
Other income, net | 19,485 | 15,393 | ||||||
Excluding the impact of the above-mentioned income and expenses related to the deferred compensation plan, the operating results for the twelve months |
Twelve Months Ended December 31, | |||||||||||||||
2021 | 2020 | ||||||||||||||
As Reported | Deferred Compensation Plan | Adjusted | % of Revenue | As Reported | Deferred Compensation Plan | Adjusted | % of Revenue | ||||||||
Gross margin | |||||||||||||||
Operating income | 72,672 | 19,485 | 92,157 | 92,480 | 15,393 | 107,873 | |||||||||
Other income (expense), net | 18,241 | -19,485 | -1,244 | - | 16,500 | -15,393 | 1,107 | ||||||||
Income from continuing operations before income tax expense | 93,040 | — | 93,040 | 103,488 | — | 103,488 | |||||||||
(2) | Included in "Other income, net" for the twelve months ended December 31, 2021 and 2020, is expense of |
(3) | Refer to the financial highlights tables for a reconciliation of Non-GAAP financial measures to the most directly comparable |
CBIZ, INC. FINANCIAL HIGHLIGHTS (UNAUDITED) (In thousands) SELECT SEGMENT DATA
| ||||||||
Three Months Ended December | Twelve Months Ended December | |||||||
2021 | 2020 | 2021 | 2020 | |||||
Revenue | ||||||||
Financial Services | $ 156,056 | $ 131,419 | 734,026 | 629,778 | ||||
Benefits and Insurance Services | 76,667 | 70,325 | 332,323 | 297,758 | ||||
National Practices | 10,105 | 9,366 | 38,576 | 36,361 | ||||
Total | $ 242,828 | $ 211,110 | $ 1,104,925 | $ 963,897 | ||||
Gross Margin | ||||||||
Financial Services | (3,338) | 2,147 | $ 125,788 | $ 104,569 | ||||
Benefits and Insurance Services | 8,765 | 10,487 | 60,673 | 49,401 | ||||
National Practices | 1,153 | 1,072 | 4,082 | 3,724 | ||||
Operating expenses - unallocated (1): | ||||||||
Other expense | (4,002) | (3,334) | (13,936) | (5,342) | ||||
Deferred compensation | (6,152) | (11,010) | (17,317) | (13,806) | ||||
Total | $ (3,574) | $ (638) | $ 159,290 | $ 138,546 | ||||
(1) | Represents operating expenses not directly allocated to individual businesses, including stock-based compensation, |
CBIZ, INC. SELECT CASH FLOW DATA (In thousands)
| ||||
Twelve Months Ended December 31, | ||||
2021 | 2020 | |||
Net income | $ 70,887 | $ 78,299 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization expense | 27,078 | 23,139 | ||
(Gain) loss on sale of operations, net | (5,995) | 509 | ||
Bad debt expense, net of recoveries | 3,054 | 4,409 | ||
Adjustments to contingent earnout liability, net | 2,367 | (629) | ||
Stock-based compensation expense | 11,407 | 8,869 | ||
Other noncash adjustments | 9,108 | (285) | ||
Net income, after adjustments to reconcile net income to net cash provided by | 117,906 | 114,311 | ||
Changes in assets and liabilities, net of acquisitions and divestitures | 13,272 | 32,605 | ||
Operating cash flows provided by continuing operations | 131,178 | 146,916 | ||
Operating cash used in discontinued operations | (24) | (71) | ||
Net cash provided by operating activities | 131,154 | 146,845 | ||
Net cash used in investing activities | (82,010) | (46,406) | ||
Net cash used in financing activities | (69,005) | (76,609) | ||
Net (decrease) increase in cash, cash equivalents and restricted cash | (19,861) | 23,830 | ||
Cash, cash equivalents and restricted cash at beginning of year | $ 170,335 | $ 146,505 | ||
Cash, cash equivalents and restricted cash at end of period | $ 150,474 | $ 170,335 | ||
Reconciliation of cash, cash equivalents and restricted cash to the | ||||
Cash and cash equivalents | $ 1,997 | $ 4,652 | ||
Restricted cash | 30,383 | 23,951 | ||
Cash equivalents included in funds held for clients | 118,094 | 141,732 | ||
Total cash, cash equivalents and restricted cash | $ 150,474 | $ 170,335 | ||
CBIZ, INC. SELECT FINANCIAL DATA AND RATIOS (In thousands)
| ||||
December 31, 2021 | December 31, 2020 | |||
Cash and cash equivalents | 1,997 | 4,652 | ||
Restricted cash | 30,383 | 23,951 | ||
Accounts receivable, net | 242,168 | 216,175 | ||
Current assets before funds held for clients | 293,765 | 268,991 | ||
Funds held for clients | 157,909 | 167,440 | ||
Goodwill and other intangible assets, net | 840,783 | 756,750 | ||
Total assets | 1,627,934 | 1,513,754 | ||
Current liabilities before client fund obligations | 265,174 | 211,285 | ||
Client fund obligations | 158,115 | 166,989 | ||
Total long-term debt | 154,851 | 107,192 | ||
Total liabilities | 923,386 | 811,134 | ||
Treasury stock | (694,716) | (595,297) | ||
Total stockholders' equity | 704,548 | 702,620 | ||
Debt to equity | ||||
Days sales outstanding (DSO) - continuing operations (1) | 71 | 72 | ||
Shares outstanding | 52,038 | 54,099 | ||
Basic weighted average common shares outstanding | 52,637 | 54,288 | ||
Diluted weighted average common shares outstanding | 53,723 | 55,359 | ||
(1) | DSO is provided for continuing operations and represents accounts receivable, net, at the end of the period, divided by trailing |
CBIZ, INC. GAAP RECONCILIATION (Loss) Income from Continuing Operations to Adjusted EBITDA(1) (In thousands)
| |||||||
Three Months Ended December | Twelve Months Ended December | ||||||
2021 | 2020 | 2021 | 2020 | ||||
(Loss) Income from continuing operations | $ (9,613) | $ (90) | $ 70,911 | $ 78,347 | |||
Interest expense | 1,016 | 816 | 3,868 | 4,983 | |||
Income tax (benefit) expense | (3,971) | (1,979) | 22,129 | 25,141 | |||
Loss (gain) on sale of operations, net | 390 | 587 | (5,995) | 509 | |||
Legal settlement, net | — | — | 30,468 | — | |||
Depreciation | 2,771 | 2,516 | 10,781 | 9,568 | |||
Amortization | 4,386 | 3,346 | 16,297 | 13,571 | |||
Adjusted EBITDA | $ (5,021) | $ 5,196 | $ 148,459 | $ 132,119 | |||
(1) | CBIZ reports its financial results in accordance with GAAP. This table reconciles Adjusted EBITDA to the most directly |
CBIZ, INC. GAAP RECONCILIATION (Loss) Income and Diluted Earnings Per Share ("EPS") from Continuing Operations to Adjusted (Loss) Income from Continuing Operations and EPS(1) (In thousands)
| |||||||
Three Months Ended December | Twelve Months Ended December | ||||||
Amounts | EPS | Amounts | EPS | ||||
(Loss) Income from continuing operations | $ (9,613) | $ (0.19) | $ 70,911 | $ 1.32 | |||
Adjustments: | |||||||
Gain on sale of operations, net | — | — | (6,311) | (0.12) | |||
Legal settlement, net | — | — | 30,468 | 0.57 | |||
Income tax effect related to adjustments | — | — | (5,746) | (0.11) | |||
Adjusted (loss) income from continuing operations | $ (9,613) | $ (0.19) | $ 89,322 | $ 1.66 | |||
(1) | CBIZ reports its financial results in accordance with GAAP. This table reconciles Adjusted (Loss) Income and Adjusted EPS to the most |
CBIZ, INC. GAAP RECONCILIATION Full Year 2022 EPS from Continuing Operations Guidance to Full Year 2022 Adjusted Diluted EPS (In thousands)
| |||
Full Year 2022 Guidance | |||
Low | High | ||
Diluted EPS - GAAP Guidance | $ 1.89 | $ 1.93 | |
Integration cost related to Marks Paneth | 0.10 | 0.10 | |
Adjusted Diluted EPS Guidance | $ 1.99 | $ 2.03 | |
GAAP Diluted EPS for 2021 | $ 1.32 | $ 1.32 | |
Adjusted Diluted EPS for 2021 | $ 1.66 | $ 1.66 | |
GAAP Diluted EPS Range | |||
Adjusted Diluted EPS Range | |||
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SOURCE CBIZ, Inc.
FAQ
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