TSX-V: HIRE Q2 2021 Results August 26, 2021 - HIRE Technologies
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Q2 2021 Results
August 26, 2021
TSX-V: HIREForward Looking Statement This presentation contains “forward-looking information” within the meaning of applicable Canadian securities laws (“forward-looking information”), with respect to the financial condition, results of operations, corporate structure and business of HIRE Technologies Inc. (“HIRE”). In certain cases, forward-looking information can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “target”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, “determine”, “continue”, “projects”, “potential”, “proposed” or “believes”, or variations or the negative of such words and phrases, or statements that certain actions, events or results “may”, “would”, “ are likely to”, “might” or “will”, “occur” or “be achieved” or the negative of these terms or comparable terminology. Forward- looking information contained in this presentation includes, but is not limited to, statements regarding: (a) the competitive and business strategies of HIRE; (b) estimates of sales growth; (c) HIRE’s ongoing investment strategy; (d) the performance of HIRE’s business and operations; (e) the intention to grow the business, operations and potential activities of HIRE; (f) the competitive conditions of the industry; (g) the intention to acquire certain other companies and businesses in our industry; (h) client retention; (i) the impact of the economy and, in particular economic downturns, on the business and the industry; and (j) future outlook and goals. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management in light of management's experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, including, without limitation, assumptions about: • the continued ability to fund our operations and each of the components in our acquisition strategy; • the successful implementation of our strategy and our ability to realize the benefits of the strategy; • our ability to develop and market new products and services; • the stability of operational and employee costs; • our ability to identify and complete successful acquisitions and to integrate those acquisitions into our business; and • our ability to successfully exit certain businesses or restructure our operations. While HIRE considers these assumptions to be reasonable, the assumptions are inherently subject to significant business, social, economic, political, regulatory, competitive and other risks and uncertainties, contingencies and other factors that could cause actual actions, events, conditions, results, performance or achievements to be materially different from those projected in the forward-looking information. Furthermore, by their very nature, forward-looking information involves a variety of known and unknown risks, uncertainties and other factors which may cause the actual plans, intentions, events, results, performance or achievements of HIRE to be materially different from those expressed or implied in this presentation. Such risks, uncertainties and other factors include, without limitation, those related to: Such factors include, among others: risks related to the recent outbreak of COVID-19, which may have material adverse effects on the global financial markets, and its business, financial position, financial performance, and cash flows; the impact on the business of broader economic factors; alignment of HIRE’s cost structure with revenue; HIRE’s limited operating history and needs for additional capital; uncertainty relating to liquidity and capital requirements; risks inherent in HIRE’s acquisition strategy; HIRE may not be able to obtain financing necessary to implement HIRE’s business plan; HIRE may not be able to obtain access to technology necessary to compete in the recruiting industry; HIRE operates in a highly competitive industry and may be unable to retain clients or market share; barriers to client portability are low; reliance on key management; and compliance with financial reporting and other requirements as a public company. As a result, there can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in this presentation. Accordingly, readers should not place undue reliance on the forward-looking information contained in this presentation. Such cautionary statements qualify all forward-looking statements made in this presentation. HIRE undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. These materials are provided for informational purposes only, and do not constitute an offer to sell, or a solicitation of an offer to buy or sell, any security or instrument. All amounts in $ CAD unless otherwise noted. — TSX-V: HIRE / hire.company 2
Key
Investment Simon Dealy
Chief Executive Officer
Highlights sdealy@hire.company
• Canada’s only public consolidator of technology, staffing and
HR firms
• Diverse revenue streams provide greater opportunities for
growth and minimize risk under varying economic conditions
Dan Teguh
• Technology is changing the staffing industry – automating the
hiring and retention process is critical for employers, Chief Financial Officer
especially post pandemic
dteguh@hire.company
• Strong management team with deep industry relationships
and demonstrated track records
• Alignment with shareholders – insider participation of 18%.
— —
TSX-V: HIRE / hire.company TSX-V: HIRE / hire.company 3+44% +116% $6.3mm
QTD Organic Growth YTD Revenue Growth QTD Revenue
+165% Taylor Ryan +173% increase in job orders Since inception record
+76% The Kavin Group +31% increase in job placements +$3.5mm from 2020 acquisitions
+29% The Headhunters +16% Peer Group weighted average1
—
TSX-V: HIRE / hire.company 4
1Randstad N.V., The Adecco Group, Robert Half International Inc., ManpowerGroup, Kforce Inc., TrueBlue, Resources Connection Inc., and The Caldwell Partners International Inc.• Cloud-based people management application
designed around data analytics, meeting
was acquired by
facilitation, immediate feedback, predictive
insights, and the Net Manager ScoreTM
in a transaction valued at • Up to $1.5mm USD in additional share
consideration based on the achievement of
$1,791,856
revenue targets over a three-year period
2021 April 1, 2021
Deal Activity • Leaders and Co., Consulting in Governance
and Leadership Inc. is an executive search
to be acquired by
firm ranked on the Hunt Scanlon Top 60.
• 5 partners and 15 staff all continuing in the
in a transaction valued at business with operations in Quebec and
British Columbia
$6,500,000
• $4.4mm in cash, $1.1mm in shares and
August 6, 2021
$1.0mm earnout subject to prescribed
financial thresholds.
(Announced)
— —
TSX-V: HIRE / hire.company TSX-V: HIRE / hire.company 5Q2 2021 Financial Summary
Record Top-line performance and prudent spend.
$11.9
2021 Mix 2020 Mix • 6mo revenue exceeds FY
29% 6% 2020
$6.4 $5.5
Revenue
• $6.5mm from acquisitions
$2.6 +146% +116% • 44% and 24% YoY organic
vs PY vs PY growth for Q2 and 6mo.
71% 94%
Q2 2021 Q2 2020 6mo 2021 6mo 2020 On-occurrence perm. Recurring Contract
Gross Margin (% of Revenue)
$4.8
Gross Margin
42% 40%
• Greater proportion of high
39%
$2.5 +$1.9mm +$3.5mm 24% 22% 24%
35%
margin on-occurrence
permanent placements in
vs PY $1.2 vs PY 21%
$0.5 2021
• Margin tightening in IT and
Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 light industrial segments
Q2 2021 Q2 2020 6mo 2021 6mo 2020
$3.5mm $3.1mm $1.6mm $6.5mm $5.4mm $3.0mm Adjusted SG&A excludes non-operating items, external professional fees on
$s and % of Revenue
M&A, share based compensation, and future contingent remuneration from
61%
55% 53% 54% acquisitions.
48% 45%
SG&A
• Improved proportionate spend on a percentage of revenue basis on
an unadjusted and adjusted basis.
Q2 2021 Q2 2021 Adj Q2 2020 6mo 2021 6mo 2021 Adj 6mo 2020
—
TSX-V: HIRE / hire.company 1Randstad N.V., The Adecco Group, Robert Half International Inc., ManpowerGroup, Kforce Inc., TrueBlue, Resources Connection Inc., and The Caldwell Partners International Inc. 6Q2 2021 Financial Summary
Bottom line performance reflects near-term investments to meet near-term growth.
Reported Adjusted1
+$0.9mm $2.5 +$4.1mm -$0.4mm -$0.3mm
vs PY vs PY vs PY vs PY
EBITDA
($0.1) ($0.6) ($0.2) ($0.5) ($0.2)
($1.0)
($1.6)
Q2 2021 Q2 2020 6mo 2021 6mo 2020 Q2 2021 Q2 2020 6mo 2021 6mo 2020
Net Income (Loss)
+$0.6mm $1.8 +$3.6mm -$0.7mm -$0.9mm
vs PY vs PY vs PY vs PY
($0.5) ($0.3) ($0.3)
($1.1) ($1.0) ($1.2)
($1.8)
Q2 2021 Q2 2020 6mo 2021 6mo 2020 Q2 2021 Q2 2020 6mo 2021 6mo 2020
+$0.01 +$0.07 -$0.01 -$0.01
Earnings (Loss)
$0.03
vs PY vs PY vs PY vs PY
Per Share
($0.01) ($0.01) ($0.01)
($0.02) ($0.02) ($0.02)
($0.04)
Q2 2021 Q2 2020 6mo 2021 6mo 2020 Q2 2021 Q2 2020 6mo 2021 6mo 2020
—
TSX-V: HIRE / hire.company 1Excludes restructuring and other non-operating items, realized gains or losses on derivative financial instruments, other unrealized fair value through profit or loss mark-to-market gains 7
or losses, earn-out payments treated as future contingent remuneration from acquisitions, and share based compensation expenses.2H 2021 Focus • Focus on strong integration and translate to value creation • Continue to drive organic growth from favourable market conditions • Continue to execute on the acquisition program. — TSX-V: HIRE / hire.company 8
Q&A — TSX-V: HIRE / hire.company 9
investors@hire.company
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