Resources Connection (NASDAQ:RGP) Posts Quarterly Earnings Results, Beats Expectations By $0.01 EPS

Resources Connection (NASDAQ:RGP) issued its quarterly earnings results on Wednesday. The company reported ($0.16) earnings per share for the quarter, beating the consensus estimate of ($0.17) by $0.01, FiscalAI reports. Resources Connection had a negative return on equity of 7.85% and a negative net margin of 10.74%.The company had revenue of $98.09 million during the quarter, compared to analysts’ expectations of $99.98 million.

Here are the key takeaways from Resources Connection’s conference call:

• Revenue and profitability remained weak: Q1 revenue fell 18.5% year over year to $98.1 million, while adjusted EBITDA was negative $3.6 million. Consulting revenue declined 25.8% amid lower project volume and utilization, and On-Demand Talent revenue fell 13.2%.
• Management expects limited near-term improvement, guiding for Q2 revenue of $95 million-$100 million—broadly consistent with Q1—and gross margin of 36%-37%. Client approval cycles, project starts, contracting, and onboarding remain slower and less predictable.
• Cost controls are producing benefits, with adjusted SG&A down 9.4% year over year to $40.3 million and better than guidance. RGP also ended the quarter with $61.2 million in cash, no debt, and $24.1 million of available revolver capacity.
• Management is increasing sales capacity and pipeline discipline in On-Demand Talent, focusing Consulting on utilization and project staffing, and simplifying its operating model. Strategic client accounts grew sequentially, but pipeline creation has not yet translated into sufficient closed wins or project starts.

Resources Connection Trading Down 20.1%

Shares of Resources Connection stock opened at $2.99 on Friday. The business has a 50-day moving average price of $4.08 and a two-hundred day moving average price of $4.17. Resources Connection has a 1-year low of $2.88 and a 1-year high of $5.36. The company has a market cap of $103.75 million, a P/E ratio of -2.20 and a beta of 0.56.

Resources Connection Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, October 1st. Shareholders of record on Thursday, September 3rd were issued a dividend of $0.07 per share. This represents a $0.28 dividend on an annualized basis and a yield of 9.4%. The ex-dividend date was Thursday, September 3rd. Resources Connection’s dividend payout ratio (DPR) is presently -23.33%.

Wall Street Analysts Forecast Growth

Several analysts recently commented on RGP shares. Wall Street Zen upgraded Resources Connection from a “sell” rating to a “hold” rating in a report on Saturday, October 3rd. Weiss Ratings restated a “sell (d-)” rating on shares of Resources Connection in a report on Friday, September 11th. One investment analyst has rated the stock with a Buy rating, one has given a Hold rating and one has assigned a Sell rating to the company’s stock. According to data from MarketBeat.com, Resources Connection has a consensus rating of “Hold”.

Resources Connection Company Profile

Resources Connection, Inc (NASDAQ:RGP), operating under the RGP brand, is a global consulting services company that helps organizations manage business-critical initiatives and transformation projects. The company provides experienced consultants and project teams to support clients on a flexible, project-based basis.

RGP’s services cover areas including finance and accounting, technology, supply chain and procurement, human resources, legal and compliance, risk management, and business transformation.