EX-99.1 3 prg8k203ex991.txt PRESS RELEASE EXHIBIT 99.1 PRESS RELEASE PRG-SCHULTZ REPORTS FOURTH QUARTER AND FULL-YEAR 2002 FINANCIAL RESULTS REVENUES AND EARNINGS IN LINE WITH PREVIOUS OUTLOOK; STRONG INCREASE IN EARNINGS AND MARGINS OVER Q4 2001; 2003 OUTLOOK REVISED ATLANTA--(BUSINESS WIRE)--Feb. 27, 2003-- PRG-Schultz International, Inc. (Nasdaq:PRGX) today announced financial results for the fourth quarter and full-year 2002, revised its 2003 full-year outlook and provided an outlook for the first quarter 2003. Fourth Quarter 2002 Financial Highlights o Reported EPS from continuing operations was $0.08 per share on a diluted basis. o Pro-forma EPS from continuing operations was $0.19 per share on a diluted basis, excluding non-recurring expenses of $10.3 million, or $0.08 per diluted share, and transition expenses of $3.4 million, or $0.03 per diluted share. o Revenues totaled $118.6 million: o Revenues from Accounts Payable Services totaled $104.7 million. o Revenues from Other Ancillary Services totaled $13.9 million. o Operating income margin increased to 8.7% of revenues from 2.5% during the fourth quarter of 2001. Excluding non-recurring and transition expenses of $13.7 million, operating income margin was 20.2% for the fourth quarter of 2002. o EBITDA margin (equivalent to operating income margin of 8.7% plus depreciation and amortization of 4.3% of revenues) improved to 13.0% of revenues from 8.9% during the fourth quarter of 2001. Excluding non-recurring and transition expenses of $13.4 million, EBITDA margin was 24.3% for the fourth quarter of 2002. o Cash flow from operating activities increased to $42.8 million for the twelve months ended December 31, 2002, from $29.2 million for the same period a year ago. John Cook, chairman and chief executive officer of PRG-Schultz stated, "I am proud that PRG-Schultz delivered solid fourth quarter and full-year financial results which were within the ranges we provided in October. During a period in which we have been making significant changes in our US Accounts Payable organization, and in what has continued to be a challenging environment, we achieved our revenue and earnings objectives for the quarter, resulting in significant year over year improvements in earnings, margins and cash flow." "2002 was a milestone year for PRG-Schultz. We created the definitive industry leader, completing the successful integration of PRG and HS&A," Cook continued. "Our newly-combined US Accounts Payable organization is now in place, and we expect the integration of our US Retail and Commercial operations to be completed during the first quarter. We are very pleased with the progress we have made to date. Given the significant changes we are making to our US Commercial model coupled with the continuation of negative market trends in that business, and given the increasing uncertainty in the retail industry and other major industries we serve, we believe it is prudent to be more conservative in our 2003 outlook for our US business. Our international business is performing well, and we expect to realize our previous revenue growth outlook in those markets." 5 Cook added, "We firmly believe that integrating our US Accounts Payable business will further enable us to leverage our combined industry expertise, capitalize on broad-scope audit opportunities and better align service delivery to the needs and opportunities of our clients. We will continue to leverage our successful business model and our market leadership to capitalize on what we believe to be significant long-term growth opportunities, both in the US and internationally, and to deliver enhanced value to our shareholders." Fourth Quarter 2002 Financial Results Revenues for the fourth quarter of 2002 totaled $118.6 million, compared to $86.4 million in the fourth quarter of 2001. Revenues from Accounts Payable Services and Other Ancillary Services totaled $104.7 million and $13.9 million, respectively, for the quarter, compared to $73.0 million and $13.4 million, respectively, a year ago. Reported earnings from continuing operations for the fourth quarter of 2002 were $5.1 million, or $0.08 per diluted share, compared to $0.1 million, or approximately breakeven, in the fourth quarter of 2001. As required under generally accepted accounting principles, after-tax interest and amortization expense related to the Company's convertible notes of approximately $1.0 million and $4.2 million, respectively, for the fourth quarter and full-year 2002 has been added back to earnings from continuing operations for the purpose of calculating diluted earnings per share. Correspondingly, the approximately 16.1 million common shares into which the convertible notes can be exchanged have been added to the diluted share count for both the fourth quarter and full-year 2002. Operating income (EBIT) totaled $10.3 million, or 8.7% of revenues, compared to $2.2 million, or 2.5% of revenues, in the same period a year ago. Earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $15.4 million, or 13.0% of revenues, compared to $7.7 million, or 8.9% of revenues in the fourth quarter of 2001. EBITDA is the equivalent of operating income (EBIT) of $10.3 million plus depreciation and amortization of $5.1 million. Excluding non-recurring expenses of $10.3 million, or $0.08 per diluted share after-tax, and transition expenses of $3.4 million, or $0.03 per diluted share after-tax, earnings from continuing operations for the fourth quarter of 2002 were $13.7 million, or $0.19 per diluted share. Excluding both non-recurring and transition expenses, operating income totaled $24.0 million, or 20.2% of revenues, and EBITDA totaled $28.8 million, or 24.3% of revenues. Schedules 3 and 4 provide summary financial results from continuing operations for the fourth quarter and full-year 2002 and 2001 by operating segment on both a reported and pro-forma basis. Schedule 5 provides a reconciliation of EBITDA and Operating Income. Full-Year 2002 Financial Results Revenues for the full-year 2002 totaled $463.3 million, compared to $314.0 million for the full-year 2001. Revenues from Accounts Payable Services and Other Ancillary Services totaled $408.9 million and $54.4 million, respectively, compared to $259.3 million and $54.7 million, respectively, a year ago. Reported earnings from continuing operations before the cumulative effect of an accounting change for the full-year 2002 were $27.6 million, or $0.40 per diluted share, compared to $2.3 million, or $0.05 per diluted share, for the full-year 2001. New Accounting Pronouncements Effective January 1, 2002, the Company implemented SFAS 142, "Goodwill and Other Intangible Assets." SFAS 142 requires that an intangible asset with a finite life be amortized over its useful life, and that an intangible asset with an 6 infinite life and goodwill not be amortized but evaluated for impairment. Accordingly, results for the fourth quarter and full-year 2002 do not include any goodwill amortization. For purposes of comparison, goodwill amortization expense totaled $2.3 million, or $0.03 per diluted share after-tax, in the fourth quarter of 2001 and $9.3 million, or $0.13 per diluted share after-tax, for the full-year 2001. As previously reported, in accordance with SFAS 142 implementation guidance, the Company recorded a non-cash, after-tax goodwill impairment charge of $17.2 million in 2002 as a cumulative effect of a change in accounting principle. The Company also adopted SFAS 145, "Rescission of FASB Statements Nos. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections," for its fiscal year ended December 31, 2002 and, as such, reclassified the extraordinary loss of $1.6 million, net of income taxes recorded in the fourth quarter of 2001 resulting from the early termination of its former $200.0 million senior credit facility from an extraordinary item to selling, general and administrative expense. The extraordinary loss consisted of the write-off of $2.6 million in unamortized deferred loan costs, net of an income tax benefit of $1.0 million. Cash Flow, DSOs and Capital Expenditures Net cash from operating activities for the twelve months ended December 31, 2002 improved to approximately $42.8 million, compared to $29.2 million in 2001. Company-wide, Days Sales Outstanding (DSOs) for the fourth quarter of 2002 stood at 53 days, compared to 55 days a year ago. DSOs for Accounts Payable Services were 59 days, compared to 60 days a year ago. Company-wide DSOs were lower than those for Accounts Payable Services, as two of the three business units which comprise the Other Ancillary Services reporting segment are on the cash basis of revenue recognition in accordance with Securities and Exchange Commission guidance. Capital expenditures totaled approximately $5.2 million for the fourth quarter of 2002 and $24.6 million for the full year 2002. Capital expenditures were significantly higher in 2002 than the company estimates for 2003 due to the acquisition and integration of HS&A, as well as the relocation of the Company's corporate headquarters in 2002. Capital expenditures in 2003 are expected to be in the range of $13 - $15 million. Share Repurchases On October 28, 2002, the Company announced that its Board of Directors has authorized the repurchase of up to $50 million of PRG-Schultz common shares. Purchases may be made in the open market or in privately negotiated transactions from time to time and will depend on market conditions, business opportunities and other factors. During the fourth quarter 2002, the Company repurchased 0.8 million shares for approximately $7.5 million. The Company funded the purchases and anticipates funding future purchases through a combination of cash flow from operations and borrowings under the Company's senior bank credit facility. Included in this authorization is the possibility of the Company exercising its second option to purchase up to approximately 1.45 million shares from an affiliate of PRG-Schultz director Howard Schultz, as previously announced in August 2002. 2003 Outlook Cook said, "To reflect the challenges in our US business, and the increasing uncertainty in the major industries we serve, we are lowering our revenue expectations for 2003. We are also adjusting our earnings expectations to reflect this reduction, as well as some additional integration and consulting costs we will incur to effectively execute on the combination of our US Accounts Payable businesses, which are expected to total approximately $0.03 per diluted share. We continue to expect revenue growth of 18 - 22% in our international Accounts Payable business in 2003 and fully intend to capitalize on the strong growth opportunities in international markets through increased investments." 7 Full-year 2003 For the full-year 2003, total revenues from continuing operations are expected to range from $465 - $477 million. Revenues from Accounts Payable Services are estimated to range from $412 - $424 million. Revenues from Other Ancillary Services are estimated to approximate $53 million. Diluted earnings per share from continuing operations are expected to range from $0.62 - $0.67 in 2003. This range reflects an earnings reduction of approximately $0.03 per diluted share for additional integration and consulting expenses to effect the combination of the US Accounts Payable business, the majority of which is expected to be incurred in the first half of 2003. The Company anticipates generating operating income in the range of $80 - 85 million, or 17 - 18% of revenues in 2003. EBITDA, which equals operating income less depreciation and amortization, is expected to be in the range of $98 - $103 million, or 21 - 22% of revenues. First Quarter 2003 For the first quarter 2003, total revenues from continuing operations are expected to range from $107 - $109 million. Revenues from Accounts Payable Services are estimated to range from $93 - $95 million. Revenues from Other Ancillary Services are estimated to approximate $14 million. Diluted earnings per share from continuing operations are expected to range from $0.07 - $0.08 in the first quarter of 2003. This range reflects an earnings reduction of approximately $0.01 - $0.02 per diluted share in connection with the completion of the integration of the US Accounts Payable operations. The Company noted that, compared to 2002, it expects a greater portion of annual revenues and earnings for 2003 to be generated in the second half of the year, which is more representative of the Company's historical experience. Conference Call and Webcast Information PRG-Schultz will hold a conference call today, February 27, 2003 at 10 a.m. ET. Listeners in the U.S. and Canada should dial 800.374.0518 at least 5 minutes prior to the start of the conference. Listeners outside the U.S. or Canada should dial 706.643.1837. To access the conference call, provide the leader's name 'John Cook', reference the Company, and provide the passcode 'PRGX.' The teleconference will also be audiocast on the Internet at www.prgx.com. Microsoft Windows Media Player is required to access the audiocast and can be downloaded from www.microsoft.com/windows/mediaplayer. About PRG-Schultz International, Inc. Headquartered in Atlanta, PRG-Schultz International, Inc. (PRG-Schultz) is the world's leading provider of recovery audit services. PRG-Schultz employs approximately 3,500 employees, providing clients in over 40 countries with insightful value to optimize and expertly manage their business transactions. Using proprietary software and expert audit methodologies, PRG-Schultz industry specialists review client invoices, purchase orders, receiving documents, databases, and correspondence files to recover lost profits due to overpayments or under-deductions. PRG-Schultz is retained on a pay-for-performance basis, receiving a percentage of each dollar recovered. Forward Looking Statements Statements made in this news release which look forward in time involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such risks and uncertainties 8 include the following: (i) if the current economic slowdown worsens, our clients may not make sufficient levels of purchases from which to deduct our claim findings and we therefore may be unable to recognize anticipated revenues, (ii) the bankruptcy of any of our larger clients, or of any such clients' larger customers or suppliers, could impair then-existing accounts receivable and reduce expected future revenues from such clients, (iii) modifications to auditor compensation models may negatively impact employee retention, and therefore, our ability to generate revenues, (iv) the businesses comprising the other ancillary services segment may require additional time and effort of Company executives and additional Company resources to help them achieve desired profitability and may distract management from its focus on the Company's core accounts payable business, and there is no guaranty that the Company can operate these businesses efficiently and profitably, (v) we may not achieve anticipated expense savings, (vi) our past and future investments in technology and e-commerce may not benefit our business, (vii) our accounts payable businesses may not grow as expected, and we may not be able to increase the number of clients, particularly commercial, utilizing broad-scope audits, and (viii) our international expansion may prove unprofitable, and (ix) the integration of our US Retail and US Commercial Accounts Payable operations may adversely affect our ability to generate anticipated revenues and profits and may not be successful or may require more time, management attention or expense than we currently anticipate. Other risks and uncertainties that may affect our business include (i) the possibility of an adverse judgment in pending securities litigation, (ii) potential timing issues that could delay revenue recognition, (iii) future weakness in the currencies of countries in which we transact business, (iv) changes in economic cycles, (v) competition from other companies, (vi) changes in governmental regulations applicable to us, and and other risk factors discussed in our Securities and Exchange Commission filings, including the Company's Form 10-Q as filed with the Securities and Exchange Commission on November 13, 2002 and post-effective amendment to Form S-3, as filed with the Securities and Exchange commission on October 29, 2002. The Company disclaims any obligation or duty to update or modify these forward-looking statements. 9 SCHEDULE 1 PRG-Schultz International, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Amounts in thousands, except per share data) (Unaudited)
Three Months Twelve Months Ended December 31, Ended December 31, ----------------- ------------------ 2002 2001 2002 2001 -------- -------- -------- -------- Revenues $118,598 $ 86,373 $463,297 $314,025 Cost of revenues 68,793 50,118 265,488 180,519 Selling, general and administrative expenses 39,537 34,102 144,724 118,902 -------- -------- -------- -------- Operating income 10,268 2,153 53,085 14,604 Interest (expense), net (2,181) (1,105) (9,339) (8,903) -------- -------- -------- -------- Earnings from continuing operations before income taxes, discontinued operations and cumulative effect of accounting change 8,087 1,048 43,746 5,701 Income taxes 2,992 906 16,186 3,363 -------- -------- -------- -------- Earnings from continuing operations before discontinued operations and cumulative effect of accounting change operations and cumulative effect of accounting change 5,095 142 27,560 2,338 Discontinued operations: Loss from discontinued operations, net of income taxes - (1,991) - (3,294) Gain (loss) on disposal / retention of discontinued operations including operating results for phase-out period, net of income taxes - (53,948) 2,716 (82,755) -------- -------- -------- -------- Gain (loss) from discontinued operations - (55,939) 2,716 (86,049) -------- -------- -------- -------- Earnings (loss) before cumulative effect of accounting change 5,095 (55,797) 30,276 (83,711) Cumulative effect of accounting change, net of income taxes - - (17,208) - -------- -------- -------- -------- Net earnings (loss) $ 5,095 $(55,797)$ 13,068 $(83,711) ======== ======== ======== ======== Basic earnings (loss) per share: Earnings from continuing operations before discontinued operations and cumulative effect of accounting change $ 0.08 $ - $ 0.44 $ 0.05 Discontinued operations - (1.15) 0.04 (1.78) Cumulative effect of accounting change - - (0.27) - -------- -------- -------- -------- Net earnings (loss) $ 0.08 $ (1.15)$ 0.21 $ (1.73) ======== ======== ======== ======== Diluted earnings (loss) per share: Earnings from continuing operations before discontinued operations and cumulative effect of accounting change $ 0.08 $ - $ 0.40 $ 0.05 Discontinued operations - (1.14) 0.03 (1.77) Cumulative effect of accounting change - - (0.21) - -------- -------- -------- -------- Net earnings (loss) $ 0.08 $ (1.14)$ 0.22 $ (1.72) ======== ======== ======== ======== Weighted average shares outstanding: Basic 62,961 48,645 62,702 48,298 ======== ======== ======== ======== Diluted 79,652 48,899 79,988 48,733 ======== ======== ======== ========
SCHEDULE 2 PRG-Schultz International, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Amounts in thousands) (Unaudited)
December 31, December 31, 2002 2001 ----------- ------------ ASSETS Current assets: Cash and cash equivalents $ 14,860 $ 33,334 Receivables: Contract receivables 69,976 52,851 Employee advances and miscellaneous receivables 3,600 4,917 ----------- ------------ Total receivables 73,576 57,768 ----------- ------------ Funds held for client obligations 9,043 8,784 Prepaid expenses and other current assets 4,068 4,860 Deferred income taxes 25,930 21,216 ----------- ------------ Total current assets 127,477 125,962 Property and equipment 35,057 24,529 Noncompete agreements 93 188 Deferred loan costs 1,011 875 Goodwill 371,833 196,820 Intangible assets 36,214 - Deferred income taxes 10,628 20,048 Other assets 3,467 10,838 ----------- ------------ Total assets $ 585,780 $ 379,260 =========== ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Notes payable $ - $ 11,564 Current installments of long-term debt 5,527 20 Obligation for client payables 9,043 8,784 Accounts payable and accrued expenses 24,269 23,937 Accrued payroll and related expenses 50,411 37,089 Deferred revenue 2,665 4,581 ----------- ------------ Total current liabilities 91,915 85,975 Long-term debt, excluding current installments 26,363 - Convertible notes, net of unamortized discount of $3,509 in 2002 and $3,834 in 2001 121,491 121,166 Deferred compensation 4,011 4,024 Other long-term liabilities 4,115 - ----------- ------------ Total liabilities 247,895 211,165 ----------- ------------ Shareholders' equity: Preferred stock - - Common stock 67 51 Additional paid-in capital 491,894 320,126 Accumulated deficit (110,678) (123,746) Accumulated other comprehensive loss (1,601) (6,385) Less treasury stock at cost (41,182) (21,024) Unearned portion of restricted stock (615) (927) ----------- ------------ Total shareholders' equity 337,885 168,095 ----------- ------------ ----------- ------------ Total liabilities and shareholders' equity $ 585,780 $ 379,260 =========== ============
SCHEDULE 3 PRG-Schultz International, Inc. and Subsidiaries Summary Reported and Pro-Forma Operating Segment Results from Continuing Operations (Unaudited)
Three Months Ended December 31 (in thousands except earnings per share data) ---------------------------------------------------------------------- 2002 ----------------------------------------------------- As Reported Non- Transition Pro-Forma Recurring Expenses Expenses ----------------------------------------------------- $ % Rev. $ $ $ % Rev. ----------------------------------------------------- Accounts Payable Services ------------------------- Revenues $ 104,699 $104,699 Operating Income $ 30,997 29.6% $ 125 $ 401 $ 31,523 30.1% ----------------------------------------------------- Other Ancillary Services ------------------------ Revenues $ 13,899 $ 13,899 Operating Income $ 2,011 14.5% $ 0 $ 0 $ 2,011 14.5% ----------------------------------------------------- Corporate Support -------------------- Operating Income ($22,740)-19.2% $10,166 $ 3,003 ($9,571)-8.1% ----------------------------------------------------- Total -------------------- Revenues $ 118,598 $118,598 Operating Income $ 10,268 8.7% $10,291 $ 3,404 $ 23,963 20.2% Earnings from Continuing Operations $ 5,095 4.3% $ 6,483 $ 2,145 $ 13,723 11.6% Diluted Earnings Per Share from Continuing Operations $ 0.08 $ 0.08 $ 0.03 $ 0.19 Diluted Shares 79,652 79,652 79,652 79,652 ----------------------------------------------------- 2001 ----------------------------------------------------- As Reported Non- Goodwill Pro-Forma Recurring Amortization Expenses ----------------------------------------------------- $ % Rev. $ $ $ % Rev. ----------------------------------------------------- Accounts Payable Services -------------------------- Revenues $ 72,965 $ 72,965 Operating Income $ 13,315 18.2% $ 2,347 $ 1,931 $ 17,593 24.1% ----------------------------------------------------- Other Ancillary Services -------------------------- Revenues $ 13,408 $ 13,408 Operating Income $ 582 4.3% $ 1,522 $ 415 $ 2,519 18.8% ----------------------------------------------------- Corporate Support ----------------- Operating Income ($11,744)-13.6% $ 4,529 ($93) ($7,308)-8.5% ----------------------------------------------------- Total ----------------- Revenues $ 86,373 $ 0 $ 0 $ 86,373 Operating Income $ 2,153 2.5% $ 8,398 $ 2,253 $ 12,804 14.8% Earnings from Continuing Operations $ 142 0.2% $ 4,317 $ 1,549 $ 6,008 7.0% Diluted Earnings Per Share from Continuing Operations $ 0.00 $ 0.09 $ 0.03 $ 0.12 Diluted Shares 48,899 48,899 48,899 48,899 ----------------------------------------------------- Note: Diluted Earnings Per Share Excludes Discontinued Operations.
SCHEDULE 4 PRG-Schultz International, Inc. and Subsidiaries Summary Reported and Pro-Forma Operating Segment Results from Continuing Operations (Unaudited)
Twelve Months Ended December 31 (in thousands except earnings per share data) ---------------------------------------------------------------------- 2002 ----------------------------------------------------- As Reported Non- Transition Pro-Forma Recurring Expenses Expenses ----------------------------------------------------- $ % Rev. $ $ $ % Rev. ----------------------------------------------------- Accounts Payable Services ---------------------------------- Revenues $ 408,900 $ 408,900 Operating Income $ 112,529 27.5% $ 1,775 $ 3,772 $ 118,076 28.9% ----------------------------------------------------- Other Ancillary Services ---------------------------------- Revenues $ 54,397 $ 54,397 Operating Income $ 8,292 15.2% $ 0 $ 0 $ 8,292 15.2% ----------------------------------------------------- Corporate Support ----------------- Operating Income ($67,736) -14.6% $12,279 $16,679 ($38,778) -8.4% ----------------------------------------------------- Total ----------------- Revenues $ 463,297 $ 463,297 Operating Income $ 53,085 11.5% $14,054 $20,451 $ 87,590 18.9% Earnings from Continuing Operations $ 27,560 5.9% $ 8,854 $12,884 $ 49,298 10.6% Diluted Earnings Per Share from Continuing Operations $ 0.40 $ 0.11 $ 0.16 $ 0.67 Diluted Shares 79,988 79,988 79,988 79,988 ----------------------------------------------------- 2001 ----------------------------------------------------- As Reported Non- Goodwill Pro-Forma Recurring Amortization Expenses ----------------------------------------------------- $ % Rev. $ $ $ % Rev. ----------------------------------------------------- Accounts Payable Services ---------------------- Revenues $ 259,264 $ 259,264 Operating Income $ 51,493 19.9% $ 2,516 $ 7,721 $ 61,730 23.8% ----------------------------------------------------- Other Ancillary Services ---------------------- Revenues $ 54,761 $ 54,761 Operating Income $ 1,299 2.4% $ 4,706 $ 1,653 $ 7,658 14.0% ----------------------------------------------------- Corporate Support ------------- Operating Income ($38,188) -12.2% $ 5,160 ($33) ($33,061) -10.5% ----------------------------------------------------- Total ------------- Revenues $ 314,025 $ 0 $ 0 $ 314,025 Operating Income $ 14,604 4.6% $12,382 $ 9,341 $ 36,327 11.6% Earnings from Continuing Operations $ 2,338 0.7% $ 6,198 $ 6,398 $ 14,934 4.8% Diluted Earnings Per Share from Continuing Operations $ 0.05 $ 0.13 $ 0.13 $ 0.31 Diluted Shares 48,733 48,733 48,733 48,733 ----------------------------------------------------- Note: Diluted Earnings Per Share Excludes Discontinued Operations and Cumulative Effect of Accounting Change (2002).
SCHEDULE 5 PRG-Schultz International, Inc. and Subsidiaries Summary EBITDA and Operating Income from Continuing Operations Reconciliation
(in thousands) (Unaudited) Three Months Twelve Months Ended December 31, Ended December 31, ------------------------------------ 2002 2001 2002 2001 ------- --------- --------- ------- Operating Income $10,268 $ 2,153 $ 53,085 $14,604 Add-back: Depreciation and Amortization $ 5,111 $ 5,509 $ 18,503 $21,865 ---------------------------------- ------- --------- --------- ------- EBITDA $15,379 $ 7,662 $ 71,588 $36,469 Add-back: Non-Recurring Expenses $ 9,986 $ 8,398 $ 13,079 $12,382 Transition Expenses $ 3,404 $ - $ 18,755 $ - ---------------------------------- ------- --------- --------- ------- EBITDA Excluding Non-Recurring & Transition Expenses $28,769 $ 16,060 $ 103,422 $48,851 EBITDA as % of Revenues 13.0% 8.9% 15.5% 11.6% EBITDA Excluding Non-Recurring & Transition Expenses as % of Revenues 24.3% 18.6% 22.3% 15.6% SOURCE: PRG-Schultz International, Inc.
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