TSR, Inc. Reports Financial Results for the Third Quarter Ended February 28, 2021

Rhea-AI Summary

TSR, Inc. (Nasdaq:TSRI) reported a 21.3% increase in revenue for Q3, ending February 28, 2021, totaling $17.1 million. The operating loss improved to $339,000 from $1,251,000 in the previous year. Net loss reduced to $305,000, with basic net loss per share at $0.16, down from $0.48. CEO Thomas Salerno attributed growth to business development in the Geneva Consulting Group. The acquisition of Geneva is expected to enhance growth and shareholder returns, with ongoing upgrades to back-office systems anticipated to boost efficiency.

Positive

• Revenue increased by 21.3% to $17.1 million.
• Operating loss decreased to $339,000 from $1,251,000.
• Net loss reduced to $305,000 compared to $945,000 in the prior year.
• Integration of Geneva Consulting Group is smooth, supporting growth.

Negative

• Despite revenue growth, $506,000 additional expenses from Geneva operations may impact profitability.
• Accrued performance bonus payments of $210,000 could strain financial resources.

TSR, Inc. (Nasdaq:TSRI) (“TSR” or the “Company”), a provider of information technology consulting and recruiting services, today announced financial results for the third quarter ended February 28, 2021.

For the quarter ended February 28, 2021, revenue increased 21.3% from the same quarter last year to $17.1 million. The loss from operations for the current quarter was $339,000 as compared to an operating loss of $1,251,000 in the prior year quarter. Net loss attributable to TSR for the current quarter was $305,000 as compared to a net loss attributable to TSR of $945,000 in the prior year quarter. Additionally, basic and diluted net loss per share for the current quarter was $0.16 compared to basic and diluted net loss per share of $0.48 in the prior year quarter.

Thomas Salerno, CEO, stated, “Revenue increased 21.3% for the third quarter primarily due to new business development within the existing Geneva Consulting Group client base. Without the added business activity from the acquisition of Geneva, revenue would have increased by 1.5%. Selling, general and administrative expenses decreased by $187,000 for the quarter. The decrease in SG&A was primarily due to the prior year accrual of $818,000 for a legal settlement with an investor. This decrease was partially offset by $506,000 in additional expenses incurred for the operations of Geneva and the accrual of $210,000 related to the final performance bonus payments to the sellers of Geneva.

“The integration of the Geneva and TSR teams has continued to go smoothly and we believe the acquisition has helped us accelerate growth and will improve returns for shareholders. We have begun to upgrade and modernize several of our back-office systems that we believe will help improve efficiencies and allow the business to continue to scale. As we expect a gradual return to normalcy from the COVID pandemic after mass vaccine rollout this year we are guardedly optimistic of generating revenue growth in the improving business climate.”

The Company has filed its Form 10-Q for the fiscal quarter ended February 28, 2021 today with further details at www.sec.gov.

Certain statements contained herein, including statements as to the Company’s plans, future prospects and future cash flow requirements are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those set forth in the forward-looking statements due to known and unknown risks and uncertainties, including but not limited to, the following: the statements concerning the success of the Company’s plan for growth; both internal and through the previously announced pursuit of suitable acquisition candidates; the successful integration of announced and completed acquisitions and any anticipated benefits therefrom; the impact of adverse economic conditions on client spending which have a negative impact on the Company’s business, which includes, but is not limited to, the current adverse economic conditions associated with the COVID-19 global health pandemic and the associated financial crisis, stay-at-home and other orders which may significantly reduce client spending and which may have a negative impact on the Company’s business; risks relating to the competitive nature of the markets for contract computer programming services; the extent to which market conditions for the Company’s contract computer programming services will continue to adversely affect the Company’s business; the concentration of the Company’s business with certain customers; uncertainty as to the Company’s ability to maintain its relations with existing customers and expand its business; the impact of changes in the industry such as the use of vendor management companies in connection with the consultant procurement process; the increase in customers moving IT operations offshore; the Company’s ability to adapt to changing market conditions; the risks, uncertainties and expense of the legal proceedings to which the Company is a party; and other risks and uncertainties described in the Company’s filings under the Securities Exchange Act of 1934. The Company is under no obligation to publicly update or revise forward-looking statements.

		Three Months Ended								Nine Months Ended
		February 28,				February 29,				February 28,				February 29,
		2021				2020				2021				2020
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenue, net		$	17,160,000			$	14,145,000			$	47,743,000			$	44,325,000
Cost of sales			14,415,000				12,124,000				39,831,000				37,580,000
Selling, general and administrative expenses			3,084,000				3,271,000				8,414,000				8,846,000
			17,499,000				15,395,000				48,245,000				46,426,000
Loss from operations			(339,000	)			(1,251,000	)			(502,000	)			(2,101,000	)
Other expense, net			(41,000	)			(43,000	)			(157,000	)			(24,000	)
Pre-tax loss			(380,000	)			(1,294,000	)			(659,000	)			(2,125,000	)
Income tax benefit			(79,000	)			(352,000	)			(114,000	)			(591,000	)
Consolidated net loss			(301,000	)			(942,000	)			(545,000	)			(1,534,000	)
Less: Net income attributable to noncontrolling interest			4,000				3,000				10,000				13,000
Net income (loss) attributable to TSR, Inc.		$	(305,000	)		$	(945,000	)		$	(555,000	)		$	(1,547,000	)
Basic net loss per TSR, Inc. common share		$	(0.16	)		$	(0.48	)		$	(0.28	)		$	(0.79	)
Diluted net loss per TSR, Inc. common share		$	(0.15	)		$	(0.48	)		$	(0.28	)		$	(0.79	)
Basic weighted average common shares outstanding			1,962,062				1,962,062				1,962,062				1,962,062
Diluted weighted average common shares outstanding			1,962,062				1,962,062				1,962,062				1,962,062

 

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FAQ

What were TSR's Q3 2021 financial results?

In Q3 2021, TSR reported revenue of $17.1 million, a 21.3% increase, with a net loss of $305,000 and a basic net loss per share of $0.16.

How did the acquisition of Geneva impact TSR's earnings?

The acquisition of Geneva contributed to a significant revenue increase, although it also introduced additional operational expenses.

What is TSR's outlook following their recent financial results?

TSR is cautiously optimistic about future revenue growth as business conditions improve post-pandemic.