Resources Connection, Inc. (NASDAQ: RECN) reported weaker-than-expected results for its third quarter on Wednesday.
The Irvine, Calif-based RECN reported Q3 2019 revenue increases 4.1% year-over-year to $179.5 million
Q3 2019 gross margin improved to 37.8% from 36.3% in prior-year.
Selling, general and administrative expense of $55.6 million (31.0% of revenue) compared to $55.3 million (32.1% of revenue) in the third quarter of fiscal 2018 shows improvement as a percent of revenue of 110 basis points year-over-year. On a sequential basis, SG&A increased $0.6 million.
Pre-tax income increased in the third quarter to $9.6 million compared to $4.6 million in the prior-year third quarter; net income increased to $5.8 million compared to $4.6 million in the prior-year third quarter.
Adjusted EBITDA was $13.9 million (7.8% of revenue) compared to $8.7 million (5.0% of revenue) in the prior-year third quarter.
Net cash provided by operating activities for the quarter was $11.8 million compared to cash used in operating activities of $3.9 million in the prior-year comparable period.
CEO Kate Duchene remarked, "We continue to make good progress in improving our top and bottom line results.
"While Europe has faced macro headwinds, our business in North America and Asia Pacific delivered growth in the quarter and have performed well cumulatively through the first three quarters of the fiscal year."
Shares stumbled $2.57, or 14.8%, to $14.78
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