Company posts increase in revenues and expects to be operating free cash flow positive for 2021
First Quarter Operational and Financial Highlights
- Revenues improved by 8% to $43.8 million, compared to $40.5 million in the same period last year.
- Operating loss improved to a loss of ($884,000), compared to operating loss of ($5.1) million in the same period last year.
- EBITDA improved to ($186,000) compared to ($4.0) million in the same period last year.1
- Adjusted EBITDA improved to $2.2 million compared to ($2.4) million in the same period last year.
The first quarter results by operating segment were as follows:
- Customer Care, $16.5 million in revenue, 38% of total – Revenue increased by $8.1 million from the previous year and year-over-year EBITDA improved to $2.6 million from ($795,000). Customer Care continued to experience strong revenue tailwinds from COVID related project work, which we expect to temper. New business wins for the quarter include providing COVID-vaccine customer care for a State government and delivering digital customer support technology for a major sports streaming network.
- Fulfillment & Logistics, $14.3 million in revenue, 33% of total – Revenue declined approximately $4 millioncompared to the previous year, primarily due to the closure of the direct mail facility during 2020. EBITDA improved to $1.2 million from ($678,000) in the prior year. With the consolidation of our Fulfillment operations into the Kansas City facility complete, we anticipate continued margin improvement in 2021. New business wins for the quarter include a large sampling program for a multibillion-dollar CPG company, and literature fulfillment for a large courier company.
- Marketing Services, $12.9 million revenue, 29% of total – Revenue and EBITDA declined by $622,000 and $479,000, respectively, from the prior year due to continued softness in client marketing spend related to the pandemic. New business wins for the quarter include projects from two well-respected CPG brands to provide CRM services, including customer analytics, strategic planning, creative execution, and data management, and a B2B CRM engagement with one of the world’s largest electronic component distributors.
EBITDA is the Company’s measure of segment profitability. For additional information please see the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.
Harte Hanks CEO, Andrew Benett, commented:
“We have continued to drive productivity increases in our workforce and reduced our real estate footprint. Further, in Q1 we began implementing a new Enterprise Resource Planning system. We anticipate the ERP project to extend into 2022 and expect to realize cost savings along the way.” Mr. Benett continued: “We have built a seasoned team to lead our businesses and expect to be operating free cash flow positive for the year.”