Volt Information Sciences, Inc. Reports Fourth Quarter and Fiscal 2021 Financial Results

Reports Year-Over-Year Revenue Growth and Positive Net Income for both the 4^th Quarter and Fiscal Year 2021

Volt Information Sciences, Inc. ("Volt" or the "Company") (NYSE-AMERICAN: VOLT) a global provider of staffing services, today announced financial results for the fourth quarter and fiscal year ended October 31, 2021.

Fourth Quarter 2021 Summary

• Revenue was $227.8 million, a 7.9% increase compared to the fourth quarter of fiscal 2020; Adjusted Revenue* increased 7.7%.
• Gross Margin increased 60 basis points year over year to 16.8%.
• GAAP Operating Income was $2.3 million, a $13.8 million improvement compared to the prior-year quarter; Adjusted Operating Income*, excluding impairment and restructuring charges, was $3.5 million.
• GAAP EPS improved to $0.06 per diluted share, compared to a loss of $0.58 per share in the fourth quarter of fiscal 2020; Adjusted EPS* was $0.11 per diluted share.
• Adjusted EBITDA* was $6.2 million, an increase of $0.3 million year over year.

Fiscal 2021 Summary

• Revenue was $885.4 million, a 7.7% increase compared to fiscal 2020; Adjusted Revenue* increased 7.1%.
• Gross Margin improved 60 basis points year over year to 16.2%.
• GAAP Operating Income was $4.8 million, a $34.2M improvement compared to the prior fiscal year; Adjusted operating income, excluding impairment and restructuring charges, was $8.1 million in fiscal 2021 compared to an operating loss of $9.8 million in fiscal 2020.
• GAAP EPS improved to $0.06 per diluted share, compared to a loss of $1.56 per share in fiscal 2020; Adjusted EPS* was $0.21 per diluted share.
• Adjusted EBITDA was $17.8 million compared to ($0.1) million in the prior year.

"Our performance in the fourth quarter and fiscal 2021 reflects the successful and continued execution of our strategic initiatives. Achieving year-over-year revenue growth each quarter and for the full year, combined with expanding our gross margin and reducing SG&A expense, we reported meaningful increases in both net income and Adjusted EBITDA," said Linda Perneau, President and Chief Executive Officer.

Ms. Perneau added, "Although we continue to experience COVID-related business disruptions, I applaud every Volt colleague across the globe who is forging ahead with the necessary agility to address the ebbs and flows of client demand and the broader labor market. The work we have done over the last two years, including the implementation of new technologies, has provided us with a strong footing going forward. We remain confident that we will continue to see an improvement in full-year profitability in fiscal 2022."

Fourth Quarter Results

North American Staffing revenue was $190.9 million, as compared to $178.6 million in the prior-year quarter. Revenue for this segment increased 6.9 percent year over year. The increase is primarily attributable to business wins in a combination of retail and mid-market clients, combined with the expansion of business within existing clients.

International Staffing revenue was $26.8 million, compared to $23.0 million in the prior-year quarter. Adjusted Revenue increased 13.9 percent year over year due to the expansion of business with existing clients in France and Belgium, as well as increased direct hire business in the U.K. and Singapore.

North American MSP revenue was $10.0 million, compared to $9.4 million in the prior-year quarter. The increase is primarily attributable to increased demand in its payroll service business.

Gross margin was 16.8 percent of revenue, a 60 basis-point increase from the prior-year quarter. The increase is primarily attributable to improved margins and higher direct hire revenue in our North American and International Staffing segments.

SG&A expense was $34.7 million or 15.2% of revenue, a $4.0 million increase from the prior-year quarter. The increase was primarily attributable to incentives on higher sales volume, as well as higher labor and medical expenses.

Adjusted EBITDA, which is a Non-GAAP measure, was $6.2 million for the fourth quarter of fiscal 2021, compared to $5.9 million in the prior-year quarter.

Fiscal 2021 Results

North American Staffing revenue was $738.8 million as compared to $689.1 million for fiscal 2020. Adjusted Revenue for this segment increased 7.5 percent. The increase is primarily attributable to business wins in a combination of retail and mid-market clients, combined with the expansion of business within existing clients. Operating Income for the year was $33.0 million compared to $14.3 million for fiscal 2020. Adjusted Operating Income for this segment, excluding impairment and restructuring charges, which is a Non-GAAP measure, was $33.0 million compared to $17.1 million in the prior year.

International Staffing revenue was $107.0 million compared to $95.3 million. Adjusted Revenue in the International Staffing segment in fiscal 2021 increased 4.9 percent. Operating Income for the year was $4.1 million compared to $1.4 million from fiscal 2020. Adjusted Operating Income, excluding impairment and restructuring charges, for this segment was $4.3 million, compared to $1.7 million in fiscal 2020.

North American MSP revenue increased 3.7 percent from the prior year, to $39.3 million. Adjusted Revenue for the segment increased 3.5 percent year over year. Operating Income for the year was $2.1 million compared to $3.1 million in the prior year. Adjusted Operating Income excluding impairment and restructuring charges, for this segment was $2.2 million compared to $3.1 million in fiscal 2020.

Gross margin increased by 60 basis points to 16.2 percent of revenue. The increase is primarily attributable to improved margins and an increase in direct hire revenue in our North American and International Staffing segments.

SG&A expense was $135.4 million, a decrease of $2.2 million, or 1.6%, from $137.7 million in the prior year. The decrease is primarily attributable to lower facility-related costs due to consolidation of the Company's real estate footprint, as well as lower software and travel expenses.

Adjusted EBITDA was $17.8 million, compared to a loss of $0.1 million in the prior year.

2021 Earnings Conference Call and Webcast

The Company will conduct a conference call on January 12, 2022, at 5:00 p.m. Eastern Time, to review the financial results for the fourth quarter and fiscal year ended October 31, 2021. A presentation supplementing the call can be accessed through the investor relations portion of the website. Investors interested in participating on the live call can dial 1-877-407-9039 within the U.S. or 1-201-689-8470 from abroad. The conference call, which may include forward-looking statements, is also being webcast and will be available via the investor relations section of the Company's website at www.volt.com. A replay of the webcast will be archived on Volt's investor relations website for 90 days.

Forward-Looking Statements

This press release contains forward-looking statements that are subject to a number of known and unknown risks. Such risks include, among others, general economic, competitive and other business conditions (including the potential impact of the strain of coronavirus known as COVID-19 and related government actions on our operations as well as the operations of our customers), the degree and timing of customer utilization and renewal rate for contracts with the Company, and the degree of success of business improvement initiatives that could cause actual results, performance and achievements to differ materially from those described or implied in the forward-looking statements. Information concerning these and other factors that could cause actual results to differ materially from those in the forward-looking statements are contained in the "Risk Factors" and other sections of the Company reports filed with the Securities and Exchange Commission ("SEC"). You are cautioned not to place undue reliance on such statements and to consult our SEC filings for additional risks and uncertainties that may apply to our business and the ownership of our securities. Our forward-looking statements are presented as of the date made, and we disclaim any duty to update such statements unless required by law to do so.

Note Regarding the Use of Non-GAAP Financial Measures

The Company has provided certain Non-GAAP financial information, including Adjusted Revenue, Adjusted Operating Income (Loss), Adjusted EPS and Adjusted EBITDA, which include adjustments to our GAAP financial results. These measures are not in accordance with, or an alternative for, generally accepted accounting principles ("GAAP") and may be different from Non-GAAP measures reported by other companies.

The Company believes that the presentation of Non-GAAP measures, including on a constant currency basis and eliminating (a) the impact of businesses sold or exited, (b) the impact from the migration of certain clients from a traditional staffing model to a managed service model and (c) special items provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations because they permit evaluation of the results of the Company without the effect of currency fluctuations, special items or the impact of businesses sold or exited that management believes make it more difficult to understand and evaluate the Company's results of operations. Special items include impairments, restructuring and severance as well as certain income or expenses which the Company does not consider indicative of the current and future period performance and are more fully disclosed in the tables.

Adjusted Revenue is defined as revenue excluding businesses exited and the effect of foreign currency translation. The Company has also migrated certain clients from a traditional staffing model to a managed service model, resulting in the Company now managing a greater percentage of such clients' business under its North American MSP. This shift provides increased opportunity for the Company with the relevant clients. However, due to the structure of MSP arrangements, revenue is recognized on a net basis, thereby reducing revenues on a comparative period basis. Beginning in the first quarter of 2020, the Company includes such delivery model shifts within the Adjusted Revenue measurement, as it provides a more comparable basis for evaluating performance results from period to period and reflects the method used by management to evaluate performance. A reconciliation is shown in the tables at the end of this press release.

Adjusted EBITDA is defined as earnings or loss before interest, income taxes, depreciation and amortization ("EBITDA") adjusted to exclude share-based compensation expense as well as the special items described above.

Adjusted EBITDA is a performance measure rather than a cash flow measure. The Company believes the presentation of Adjusted EBITDA is relevant and useful for investors because it allows investors to view results in a manner similar to the method used by management.

Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, analysis of the Company's results of operations and operating cash flows as reported under GAAP. For example, Adjusted EBITDA does not reflect capital expenditures or contractual commitments; does not reflect changes in, or cash requirements for, the Company's working capital needs; does not reflect the interest expense, or the cash requirements necessary to service the interest payments, on the Company's debt; and does not reflect cash required to pay income taxes.

Adjusted Operating Income (Loss) is defined as operating income (loss) excluding businesses exited.

The Company believes the presentation of Adjusted Operating Income (Loss) is relevant and useful for investors because it provides a more comparable basis to evaluate performance results and analyze trends from period to period in a manner similar to the method used by management.

Adjusted EPS is defined as earnings per share excluding impairment and restructuring charges. The Company believes that the presentation of Adjusted EPS is useful for investors since it removes certain special items which the Company does not consider indicative of the current and future period performance.

The Company's computation of Adjusted Revenue, Adjusted EBITDA, Adjusted Operating Income (Loss) and Adjusted EPS may not be comparable to other similarly titled measures computed by other companies because all companies do not calculate these measures in the same fashion.

About Volt Information Sciences, Inc.

Volt is a global provider of staffing services (traditional time and materials-based as well as project-based). Our staffing services consist of workforce solutions that include providing contingent workers, personnel recruitment services and managed staffing services programs supporting primarily administrative, technical, information technology, light-industrial and engineering positions. Our managed staffing programs involve managing the procurement and on-boarding of contingent workers from multiple providers. Volt services global industries including aerospace, automotive, banking and finance, consumer electronics, information technology, insurance, life sciences, manufacturing, media and entertainment, pharmaceutical, software, telecommunications, transportation and utilities. For more information, visit www.volt.com.

Investor Relations Contacts:

Volt Information Sciences, Inc.

[email protected]

Joe Noyons

Three Part Advisors

[email protected]

817-778-8424

Financial Tables Follow

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