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HTGB...Heritage Global Inc. Reports First Quarter 2024 Results

Company Reports Operating Income of $2.6 Million

Subsequent to First Quarter Company Closed an Equipment Sale and Real Estate Lease Transaction With Multi-National Pharmaceutical Company

SAN DIEGO--(BUSINESS WIRE)-- Heritage Global Inc. (NASDAQ: HGBL) (“Heritage Global,” “HG” or “the Company”), an asset services company specializing in financial and industrial asset transactions, today reported financial results for the first quarter ended March 31, 2024.

Heritage Global Chief Executive Officer Ross Dove commented, “2024 is off to a solid start with continued profitability in the business. Our financial division is executing well and benefiting from heightened economic pressures driving increases in charged-off credit cards and non-performing loans. Our industrial division continues to see healthy levels of equipment and asset auction activity, but faced a tough comparison in the quarter given a large auction that took place in the first quarter of 2023. Importantly, subsequent to the close of the first quarter, our auction division, in conjunction with our partners, completed a highly accretive transaction involving the sale of equipment and a 10-year building lease on the recently acquired pharmaceutical plant in Fenton, Missouri.

“Looking forward, the pipeline is strong across our businesses and we look forward to continuing to drive long term organic growth and profitability. Additionally, M&A is a strategic focus as we move forward and we are seeing increased opportunities in the markets we serve,” Mr. Dove concluded.

First Quarter 2024 Highlights:

The Company achieved operating income of $2.6 million for the first quarter of 2024, as compared to operating income of $3.9 million in the first quarter of 2023.
EBITDA totaled $2.7 million in the first quarter of 2024 versus EBITDA of $4.0 million in the first quarter of 2023 and Adjusted EBITDA was $2.9 million compared to $4.2 million in the prior-year quarter.
Net income totaled $1.8 million or $0.05 of diluted earnings per share for the first quarter of 2024, as compared to net income of $2.8 million or $0.08 of diluted earnings per share in the prior-year quarter.
The Company strengthened its balance sheet by increasing stockholders’ equity to $63.0 million as of March 31, 2024, compared to $61.1 million as of December 31, 2023, and increased net working capital to $15.0 million at the end of the first quarter of 2024, compared to $11.6 million at the end of the fourth quarter of 2023. The Company’s available and unused balance on its credit facility remains at $10.0 million as of March 31, 2024. The strengthened balance sheet and liquidity positions the Company well to pursue its M&A strategy.
As of March 31, 2024, the Company held a gross balance of investments in notes receivable of $37.3 million, recorded in both notes receivable and equity method investments.

First Quarter Conference Call

Management will host a webcast and conference call on Thursday, May 9, 2024, at 5:00 p.m. ET to discuss financial results for the first quarter of 2024. Analysts and investors may participate via conference call, using the following dial-in information:

1-800-830-9649 (Domestic)
1-213-992-4624 (International)
To access the webcast, individuals can use this link. The conference call will also be available in the Investor Relations section of the Company’s website. To listen to a live broadcast, go to the site or click on the webcast link at least 10 minutes prior to the scheduled start time in order to register.

Replay

A replay of the call will be available on the Company’s website approximately three hours after the call ends through May 23, 2024. To access the replay, dial 1-844-512-2921 (domestic) or 1-412-317-6671 (international). The replay pin number is 11155834. The replay can also be accessed on the Investor Relations section of the Company’s website.

About Heritage Global Inc. (“HG”)

Heritage Global Inc. (NASDAQ: HGBL) values and monetizes industrial & financial assets by providing acquisition, disposition, valuation, and lending services for surplus and distressed assets. This aids in facilitating the circular economy by diverting useful industrial assets from landfills and operating an ethical supply chain by overseeing post-sale account activity of financial assets. Specialties consist of acting as an adviser, in addition to acquiring or brokering turnkey manufacturing facilities, surplus industrial machinery and equipment, industrial inventories, real estate, and charged-off account receivable portfolios through its two business units: Industrial Assets and Financial Assets.
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