dhx-20210331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q

(Mark One)


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarter ended March 31, 2021

______________________________________________


☐			TRANSITION PERIOD PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

Commission File Number: 001-33584

____________________________________________

DHI Group, Inc.

(Exact name of Registrant as specified in its Charter)

______________________________________________


Delaware						20-3179218
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

6465 South Greenwood Plaza, Suite 400

Centennial, Colorado

(Address of principal executive offices)

80111

(Zip Code)

(212) 448-6605

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

_______________________________________________


Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	DHX	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☑ Non-accelerated filer ☐ Smaller Reporting Company ☑ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of April 30, 2021, there were 52,176,663 shares of the registrant’s common stock, par value $.01 per share, outstanding.

Table of Contents

DHI GROUP, INC.

TABLE OF CONTENTS


		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Unaudited Financial Statements	2
	Condensed Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020
	Condensed Consolidated Statements of Operations for the three month periods ended March 31, 2021 and 2020
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the three month periods ended March 31, 2021 and 2020
	Condensed Consolidated Statements of Stockholders' Equity for the three month periods ended March 31, 2021 and 2020
	Condensed Consolidated Statements of Cash Flows for the three month periods ended March 31, 2021 and 2020
	Notes to Condensed Consolidated Financial Statements

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4.	Controls and Procedures	30

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	31

Item 1A.	Risk Factors	31

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31

Item 5.	Other Information	32

Item 6.	Exhibits	33

SIGNATURES
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Table of Contents

PART I

ITEM 1. Financial Statements

DHI GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(in thousands, except per share data)


	March 31, 2021		December 31, 2020
ASSETS
Current assets
Cash and cash equivalents	$	7,319	$	7,640
Accounts receivable, net of allowance for doubtful accounts of $1,245 and $1,182	23,645		20,298
Income taxes receivable	595		1,044
Equity security	2,513		—
Prepaid and other current assets	3,768		4,503
Total current assets	37,840		33,485
Fixed assets, net	24,114		24,544
Acquired intangible assets	23,800		23,800
Capitalized contract costs	8,519		7,734
Goodwill	133,684		133,353
Deferred income taxes	—		19
Operating lease right-of-use assets	15,600		16,405
Other assets	1,750		1,647
Total assets	$	245,307	$	240,987
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued expenses	$	13,007	$	19,426
Operating lease liabilities	3,411		3,410
Deferred revenue	51,762		42,426
Income taxes payable	799		123
Total current liabilities	68,979		65,385
Long-term debt, net	19,619		19,583
Deferred income taxes	9,613		9,936
Deferred revenue	1,038		1,068
Accrual for unrecognized tax benefits	1,414		1,347
Operating lease liabilities	12,889		13,704
Other long-term liabilities	2,325		2,394
Total liabilities	115,877		113,417
Commitments and Contingencies (Note 10)
Stockholders’ equity
Convertible preferred stock, $.01 par value, authorized 20,000 shares; no shares issued and outstanding	—		—
Common stock, $.01 par value, authorized 240,000; issued 73,271 and 71,233 shares, respectively; outstanding: 52,160 and 51,220 shares, respectively	735		714
Additional paid-in capital	235,312		233,554
Accumulated other comprehensive loss	(28,222)		(28,519)
Accumulated earnings	56,642		53,971
Treasury stock, 21,111 and 20,013 shares, respectively	(135,037)		(132,150)
Total stockholders’ equity	129,430		127,570
Total liabilities and stockholders’ equity	$	245,307	$	240,987
See accompanying notes to the condensed consolidated financial statements.

Table of Contents

DHI GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share amounts)


	Three Months Ended March 31,
	2021		2020
Revenues	$	32,633	$	36,633

Operating expenses:
Cost of revenues	4,310		4,176
Product development	4,184		4,165
Sales and marketing	12,045		14,538
General and administrative	7,500		8,551
Depreciation	4,096		3,253
Impairment of intangible assets	—		7,200
Total operating expenses	32,135		41,883
Operating income (loss)	498		(5,250)
Interest expense and other	(193)		(183)
Impairment of equity investment	—		(2,002)
Unrealized gain on equity security	2,513		—
Income (loss) before income taxes	2,818		(7,435)
Income tax expense (benefit)	147		(885)
Net income (loss)	$	2,671	$	(6,550)

Basic earnings (loss) per share	$	0.06	$	(0.13)
Diluted earnings (loss) per share	$	0.05	$	(0.13)

Weighted-average basic shares outstanding	46,993		49,134
Weighted-average diluted shares outstanding	48,606		49,134

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

DHI GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited)

(in thousands)


	Three Months Ended March 31,
	2021		2020
Net income (loss)	$	2,671	$	(6,550)

Foreign currency translation adjustment	297		(3,865)

Total other comprehensive income (loss)	297		(3,865)
Comprehensive income (loss)	$	2,968	$	(10,415)

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

DHI GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(unaudited)

(in thousands)


	Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Treasury Stock			Accumulated Earnings		Accumulated Other Comprehensive Loss		Total
	Shares Issued	Amount		Shares Issued	Amount				Shares	Amount













Balance at December 31, 2020	—	$	—	71,233	$	714	$	233,554	20,013	$	(132,150)	$	53,971	$	(28,519)	$	127,570
Net income												2,671				2,671
Other comprehensive income														297		297
Stock based compensation							1,758									1,758
Restricted stock issued				1,468	15											15
Restricted stock forfeited or withheld to satisfy tax obligations				(204)	(2)				369	(984)						(986)
Performance-Based Restricted Stock Units forfeited or withheld to satisfy tax obligations				(39)	—				139	(357)						(357)
Performance-Based Restricted Stock Units eligible to vest				813	8											8
Purchase of treasury stock under stock repurchase plan									590	(1,546)						(1,546)
Balance at March 31, 2021	—	$	—	73,271	$	735	$	235,312	21,111	$	(135,037)	$	56,642	$	(28,222)	$	129,430


	Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Treasury Stock			Accumulated Earnings		Accumulated Other Comprehensive Loss		Total
	Shares Issued	Amount		Shares Issued	Amount				Shares	Amount
Balance at December 31, 2019	—	$	—	69,509	$	696	$	227,227	15,591	$	(121,466)	$	83,986	$	(29,248)	$	161,195
Net income												(6,550)				(6,550)
Other comprehensive loss														(3,865)		(3,865)
Stock based compensation							1,796									1,796
Restricted stock issued				1,468	15											15
Restricted stock forfeited or withheld to satisfy tax obligations				(163)	(1)				381	(1,048)						(1,049)
Performance-Based Restricted Stock Units forfeited or withheld to satisfy tax obligations				(5)	—				100	(300)						(300)
Purchase of treasury stock under stock repurchase plan									660	(1,643)						(1,643)


Balance at March 31, 2020	—	$	—	70,809	$	710	$	229,023	16,732	$	(124,457)	$	77,436	$	(33,113)	$	149,599

See accompanying notes to the condensed consolidated financial statements.

DHI GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands)


	Three Months Ended March 31,
	2021		2020
Cash flows from (used in) operating activities:
Net income (loss)	$	2,671	$	(6,550)
Adjustments to reconcile net income to net cash flows from (used in) operating activities:
Depreciation	4,096		3,253
Deferred income taxes	(304)		(1,262)
Amortization of deferred financing costs	37		37
Stock based compensation	1,758		1,796
Impairment of intangible assets	—		7,200
Impairment of equity investment	—		2,002
Unrealized gain on equity security	(2,513)		—
Change in accrual for unrecognized tax benefits	59		(81)
Changes in operating assets and liabilities:
Accounts receivable	(3,345)		(2,111)
Prepaid expenses and other assets	629		42
Capitalized contract costs	(

SEC Form 10-Q filed by DHI Group, Inc.