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Edited Transcript of BGSF.N earnings conference call or presentation 5-Nov-20 9:30pm GMT

·26 min read

Q3 2020 BG Staffing Inc Earnings Call PLANO Nov 17, 2020 (Thomson StreetEvents) -- Edited Transcript of BG Staffing Inc earnings conference call or presentation Thursday, November 5, 2020 at 9:30:00pm GMT TEXT version of Transcript ================================================================================ Corporate Participants ================================================================================ * Beth A. Garvey BG Staffing, Inc. - President, CEO & Director * Dan Hollenbach BG Staffing, Inc. - CFO & Secretary * Hala Elsherbini ================================================================================ Conference Call Participants ================================================================================ * Howard Allen Halpern Taglich Brothers, Inc., Research Division - Senior Equity Analyst * Michael Nicholas Taglich Taglich Brothers, Inc. - Co-Founder, President, Chairman and Finance & Operations Principal * Sarra Jean Schuster ROTH Capital Partners, LLC, Research Division - Administrator of Research ================================================================================ Presentation -------------------------------------------------------------------------------- Operator [1] -------------------------------------------------------------------------------- Good afternoon, everyone. Welcome to the BG Staffing Third Quarter 2020 Financial Results Conference Call. As a reminder, this conference call is being recorded. Now I will turn the call over to Hala Elsherbini, Investor Relations to provide introductions and read the safe harbor statement. Please go ahead. -------------------------------------------------------------------------------- Hala Elsherbini, [2] -------------------------------------------------------------------------------- Thank you, and welcome to the BG Staffing Third Quarter 2020 Earnings Results Conference Call. With me today are Beth Garvey, President and CEO; and Dan Hollenbach, Chief Financial Officer. After the speakers' opening remarks, there will be a Q&A session. As noted, today's call is being recorded and webcast live. A replay will be available later today and archived for 90 days on the company's website. Now for the safe harbor statement. Discussions today will include forward-looking statements, which are based on certain assumptions made by BGSF based on and are made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The company's actual results could differ materially from those indicated by the forward-looking statements because of various risks and uncertainties, including those listed in Item 1A of the company's annual report on Form 10-K and the quarterly reports on Form 10-Q and in the company's other filings and reports with the Securities and Exchange Commission. All risks and uncertainties are beyond the ability of the company to control, and in many cases, the company cannot predict the risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. These forward-looking statements are made as of the date of this call and BGSF assumes no obligation to update these statements publicly even if new information becomes available in the future. This broadcast is being covered by U.S. copyright laws, and any use or rebroadcast of all or any portion of this conference call may only be done with the company's express written permission. During the call, management may -- will discuss some non-GAAP measures, which are used for internal evaluation and to report the results of the business as useful information to management, the Board of Directors and investors of our operating activities and business trends related to our financial condition and results of operations. These non-GAAP measures are intended to supplement GAAP financial information and should not be considered in isolation as a substitute for or superior to financial measures calculated in accordance with GAAP. For a reconciliation of these non-GAAP measures to the most directly comparable GAAP measures, please see today's news release posted on the company's website. I'll now turn the call over to Beth Garvey. Beth? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [3] -------------------------------------------------------------------------------- Thank you, Hala, and thank you to everyone for joining today's call. I hope that you and your families are remaining healthy and safe. I'll begin today's call with a review of our operational highlights and segment performance, and then I'll turn the call over to Dan to discuss our financial results and return at the end of the call for some closing remarks. We continue to be grateful to our entire teams for their passion and diligence in maintaining exceptional levels of service. They are the foundation of our success as we continue to support our client, partners and build talent in new and differentiated ways. We are taking decisive actions and strategic positions that strategically positions the company through realigned sales strategies, further strengthening our market position and capitalizing on our synergies across our divisions. The process is working as we have been able to outperform the industry as well as double our dividend from prior quarter. We are seeing positive gains from our move to digital client engagement, and we are continuously looking for ways to modify and enhance our business units to elevate our performance and service offerings. Our teams have embraced our back to the office COVID playbook with some team members voluntary returning to the office and adhering to CDC protocol while others are opting to continue to work from home and leveraging our digital shift quite well. Productivity has not wavered, and we are seeing strong client partner engagement due to our hard work and efforts. Since COVID-19 began, we have strategically enhanced our business and have completed several initiatives to support our platform for future growth to solidify our market position within our peer group. We are pleased with all the overall results and excited to see strong sequential growth in Real Estate and Light Industrial with continued improvement in Professional. Dan will provide more detailed numbers shortly. We continue to see improvement and enhancements from our new D365 ERP system, which went live in Q2, replacing our legacy system. We're seeing the benefits of our recently launched Power BI platform that is creating improved data analytics for better reporting and development metrics. Our website upgrades have doubled the speed and increased the flow of applicants seeking work. As we noted last quarter, we launched the new automated time card system in real estate, and we're seeing positive engagement as adoption continues to build. These technology enhancements will significantly improve operating and order management efficiencies, streamline and simplify our workflow and drive further capabilities to ultimately enhance margin dollars. Shifting to division performances. During the quarter, we've restructured our business primarily in real estate by integrating our multifamily and talent leadership teams. This is opening up new market and business opportunities to equip our highly talented professionals with better processes, training, tracking and improved audit policies that we believe will ultimately drive sales growth and continue our first-class service clients. We further strategically integrated our Professional division post our recent acquisitions to align the teams in their service offering verticals, enabling more synergies between our recognized brands. Overall, I believe our diversification has helped to mitigate pressure on our results. As we discussed on prior calls, the Real Estate division has been impacted the most. Although we are very pleased with their sequential month-over-month improvements that we are seeing now. Additionally, we -- additionally, while some restrictions have lifted on workers returning to the office, BG talent activity remains soft due to the prolonged shift to remote work and office buildings largely remaining empty. In response to the decline, we are selling in new and unique ways based on the circumstances we faced from COVID-19. We are working on improving our sales execution on open orders and launched a talent acquisition center to improve our candidate funnel, optimizing our staffing recruitment across all markets. We are well positioned for the recovery in real estate, realizing clients are holding cash and not adding to staffing requirements, giving the CDC's guidelines on evictions. The moratorium is set to expire on December 31, which is keeping clients on the sidelines. However, we are closely monitoring the situation as we enter into fourth quarter and into Q1, which are seasonally our slowest quarters. Professional saw a resurgence in activity. And during the quarter, we further integrated our recent acquisitions through reorganization as mentioned earlier. Our brand verticals are now grouped under IT consulting, which encompasses Extrinsic, American Partners and EdgeRock. And for infrastructure and development, Zycron and Vision Technologies are now collaborating. L.J. Kushner, recent -- our cybersecurity acquisition touches all areas of our operations regardless of the segment. Lastly, we've also merged leadership within Finance & Accounting groups to streamline reporting and marketing efforts. We'll expect to see cost synergies, meaningful efficiencies and elevated cross-selling opportunities across all BGSS brands. Professional division teams continue to host frequent cross-selling splits events that also generate wins for real estate and Light Industrial division. And we are also seeing that Professional division is benefiting from higher demand on client partners moving into the cloud. The sales pipeline remains very active, and the outlook moving forward looks very strong. This group continues to do an amazing job in managing and educating our client partners on benefits of a national talent pool available to them virtually. Light industrial is most exciting as we are pleased with the rebound in activity. We saw a nice lift in our overall performance, delivering better-than-expected results given the tailwind in warehouse labor shortages. Keep in mind that this division is heavily weighted in warehouse logistics and fulfillment needs, and we've seen an uptick in activity for these positions resulting from the significant shift to online shopping during the pandemic. Light industrial sales are back to pre-COVID levels, and we anticipate a strong finish to the year with stable margins. Our diversification across clients, partners, brand solutions and markets helped mitigate the impact on our overall results. Strategically, we are spending more time working on the business by reinvesting in our people and technologies to strengthen our position as the overall market recovers. We remain focused on our previously discussed IT road map and expect these initiatives to greatly impact future efficiencies and drive sales growth going forward. As we discussed in the past, people are our most important assets. A key priority creating an empowered to culture, which includes actionable initiatives toward diversity, equity and inclusion. During the quarter, we established a DEI council, developed our DEI pillars of Excellence as well as our strategic initiatives and KPIs. Overall, these initiatives will foster diversity education, training and engagement as we do more to drive an open, supportive and inclusive culture across our company and the communities where we work and live. Lastly, I'm encouraged to see the industry outlook remains positive for each of our segments, with the latest Staffing Industry Analysts September report forecasting a 12% overall industry growth rate for 2021. We've remained well positioned, and I am confident that we are taking the right steps to take advantage of opportunities for sustained long-term growth. With that, I'll turn the call over to Dan to discuss the financials. -------------------------------------------------------------------------------- Dan Hollenbach, BG Staffing, Inc. - CFO & Secretary [4] -------------------------------------------------------------------------------- Thank you, Beth, and good afternoon, everyone. Thank you for joining us today, and I hope everyone is continuing to stay healthy. I echo Beth's remarks and extend my gratitude to our entire team, who continue to show great resolve and resiliency as we navigate the evolving environment. We filed our 10-Q for the third quarter ended September 27, 2020, early this morning, so I'll focus my remarks on key financial highlights for the quarter and the 9-month period. Throughout the quarter, we continued to maintain targeted company-wide expense controls and manage our IT road map toward capital projects already underway to automate business processes and further improve cost efficiencies. And while the pace and strength of economic conditions remain uncertain, we continue to take an offensive posture through proactive measures in realigning our division leadership structure, as Beth discussed. We expect these initiatives will greatly enhance our cross-selling efforts. On a sequential basis, Q3 cross-selling efforts for the Professional group represented 8% of revenue and 10% of gross profit compared to 7% of revenue and 8.5% of gross profit in Q2. Overall, third quarter consolidated revenues declined by 9.9% to $71.5 million compared to Q3 last year. Revenues were negatively impacted by a 35% decline in real estate, offset by $9.5 million of revenue contributed from our 2 acquisitions in the Professional division. On a sequential basis, we saw tremendous improvement in real estate with a 62.6% increase over Q2 and light industrial delivered a 29.2% sequential gain. While Professional legacy revenues were lowered by 8.8% sequentially, L.J Kushner posted remarkable sequential increase. Placements improved 8.6% versus Q2. We look to be in a strong trajectory as we move towards Q4 and 2021. Although third quarter year-over-year consolidated results declined, we were pleased to see better-than-expected results in industrial as revenues and margins were largely in line with last year's third quarter. As noted, our acquisitions added $9.5 million of revenue, yielding an overall 8% increase in professional revenues. While third quarter typically peaks for real estate, the division continued to be challenged by pandemic-related disruptions and the subsequent slowdown in multifamily community maintenance and commercial building needs. From a margin perspective, consolidated gross profit declined by 11.1% to $19.7 million. As a percent of revenue, gross margin was down slightly at 27.6%. Benefiting from an improvement in average spreads, offset by lower revenues in the real estate group. SG&A expenses remained relatively flat, largely due to expenses incurred from our 2 recent acquisitions, offset by our cost mitigating actions taken in our legacy divisions at the onset of the pandemic. As a percent of revenue, consolidated SG&A expenses for the third quarter were 20.8% versus 18.3% last year, reflecting the revenues impacted -- impact discussed earlier. Third quarter net income decreased to $2.6 million or $0.25 per diluted share compared with net income of $4.2 million or $0.41 per diluted share in the year ago quarter. Our effective tax rate was 22% versus 24.1% last year. Adjusted EBITDA was $5.5 million or $0.35 per diluted share compared to adjusted EBITDA of $8.3 million or $0.54 per diluted share in the year ago period. For the 9-month period, revenues were $208.2 million, down 6.2% year-over-year, while gross profit was $56.9 million, down 7.5%. The impact on revenues was driven by a 30.2% decline in real estate, offset by $26.2 million revenue contributed from our 2 acquisitions. Gross margin percent was relatively flat at 27.3% versus 27.7% in Q3 of '19. For the year-to-date period, we incurred a net loss of $765,000 or negative $0.07 per diluted share compared to net income of $10.5 million or $1.01 per diluted share in 2019. The net loss for the year included an impairment of certain intangible assets of $5.4 million net of tax that was recognized in the second quarter in our Finance & Accounting division. Our effective tax rate was 25.4% for the 2020 9-month period compared to 23.3% in 2019. Net income before the impact of the impairment was $4.7 million. Adjusted EBITDA was $14 million versus $20.3 million in '19, and adjusted earnings per share decreased to $0.82 versus $1.29. Our SG&A expenses for the year increased by $3 million, primarily due to additional costs from our recent acquisitions, additional IT road map costs and transaction fees related to our acquisition, offset by a $5.4 million decrease in divisional legacy costs. We continue to prudently manage our cash flow and strengthen our balance sheet and liquidity position. Cash generated from operations increased by $4.3 million, primarily due to collection and receivables. Additionally, DSOs at the quarter end remained consistent at 53 days versus 51 days at the end of Q2. Debt leverage remains under 2x as our debt to adjusted trailing 12-month EBITDA ratio was 1.84x at September 27. For the third quarter, we reduced outstanding debt by $2.6 million. -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [5] -------------------------------------------------------------------------------- We are pleased to see the Board of Directors approved an increase to the cash dividend of $0.05 to $0.10 per share. This is our 24th consecutive dividend payment and further evidence of our confidence of our long-term outlook. Returning value to shareholders in the form of sustainable recurring dividend has been a cornerstone of our capital deployment philosophy. Our goal is to maintain ample flexibility while executing our strategic plan, reengage in opportunistic acquisitions and successfully navigate changing market conditions, while we believe we will allow us to emerge even stronger. So I am pleased with how our teams are executing. Our internal team, field talent and consultants are all showing tremendous result in collaboration, seeking opportunities to maintain our consistently high level of service, while others -- while supporting our communities. On a consolidated basis, we continue to see strong sequential movement in the right direction, while we eagerly await our economy to rebound. We continue to evaluate the landscape for future prospects to open new markets and to assess M&A opportunities. The M&A pipeline is starting to become more active again, and we are well positioned to take advantage of these potential opportunities. We remain focused on opportunities that offer geographic and brand diversification into high-growth areas and are synergistic to margin enhancements and very quickly accretive. We remain laser-focused on continuing to improve our financial and operational performances, building upon strategic priorities, technology investment road map and reorganizations executed over the last 18 months. The COVID-19 crisis has put us in a position to be even more -- to even -- to be even more internal reflecting and scrutiny to proactively address gaps and further strengthen our foundation to capitalize on future growth. We have become more and more disciplined, more responsive and more dynamic, and we are well prepared and capable of continuing to operate efficiently and effectively while maintaining a position of strength and stellar execution. The teamwork and commitment of the entire organization are to be commended. With that said, I will turn the call over to the operator for questions. Karen? ================================================================================ Questions and Answers -------------------------------------------------------------------------------- Operator [1] -------------------------------------------------------------------------------- (Operator Instructions) The first question will be from Jeff Martin of ROTH Capital. -------------------------------------------------------------------------------- Sarra Jean Schuster, ROTH Capital Partners, LLC, Research Division - Administrator of Research [2] -------------------------------------------------------------------------------- This is Sarra Schuster calling in on behalf of Jeff Martin. And Dan, I hope you're feeling a little bit better. I had the biggest allergy attack this morning myself, and it was a sneeze fest. -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [3] -------------------------------------------------------------------------------- I'll have you put a mask on. -------------------------------------------------------------------------------- Sarra Jean Schuster, ROTH Capital Partners, LLC, Research Division - Administrator of Research [4] -------------------------------------------------------------------------------- Congratulations on the quarter. Some of the questions for today. Cross-selling has been a strong point for BG over the past year. How has that held up over the past quarter? And what are some of the elements of the strategy that are successful? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [5] -------------------------------------------------------------------------------- As Dan pointed out with the numbers, we did see a growth in the cross-sell results in revenue as well as gross profit. But I think that we -- I think we talked about this last quarter, we have put in a strategic accounts team in the Professional division. And that team has really elevated our game in being able to get in front of customers and cross-sell for the future. The reorganization that I mentioned during my part of the session really was launched late in Q3, and we think that those initiatives are really going to set us apart in Q4 and entering into 2021 for cross-sell initiatives. -------------------------------------------------------------------------------- Sarra Jean Schuster, ROTH Capital Partners, LLC, Research Division - Administrator of Research [6] -------------------------------------------------------------------------------- The pandemic -- this pandemic, it's forcing organizations to revisit operations and operational structures. What changes has BG made over the past 6 months? And what benefits do you anticipate will result? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [7] -------------------------------------------------------------------------------- Many of those things I've covered during our conversation. And again, I'm so very grateful. I'm kind of one of those rude people that when something bad happens, I try to look for the lesson in it. And I'm grateful for the fact that we really had an opportunity to look into -- inside our organization and see where we could be stronger and better and take advantage of this time to be able to leverage that. I think we've done a lot of that, a lot of self-searching and a lot of really talking into what we want to not only be today, but what do we want to look like 5 years from now and putting in some of those initiatives can get us there. I think that the efficiencies that we've put in with some of our technologies as well as some of the training things that we have put in, is really going to drive activity into the fourth quarter and really kind of slow down or actually, I should say, speed up some of the things that we were taking our time with, like the automated time card system and how that's going to affect the future and speed those processes at. And I think as we've launched them and they're really kind of getting traction, it will be fun to see how they turn out in Q4 and into 2021. -------------------------------------------------------------------------------- Sarra Jean Schuster, ROTH Capital Partners, LLC, Research Division - Administrator of Research [8] -------------------------------------------------------------------------------- And last question, recognizing that BG does not provide guidance, could you walk us through qualitatively how you see each of your 3 segments faring as we nearly are entering 2021? -------------------------------------------------------------------------------- Dan Hollenbach, BG Staffing, Inc. - CFO & Secretary [9] -------------------------------------------------------------------------------- Yes. So we're -- on the real estate side, we are seeing positive movement into the fourth quarter, which is good. As Beth mentioned, a lot will depend on what happens with the eviction moratorium that ends at the end of December. We're cautiously optimistic that the first half of next year, we'll continue to see some movement in the right direction. Light Industrial is going well. October numbers are, in fact, better than last year. So their gain in the third quarter is remaining in the fourth quarter, and they're positive about Q4 numbers. Our professional group had a slowdown post-pandemic, and it impacted third quarter revenues early on, but September has been, as I like to say on the sales side, on fire. So we're expecting some positive things in the fourth quarter and into 2021. So... -------------------------------------------------------------------------------- Operator [10] -------------------------------------------------------------------------------- (Operator Instructions) The next question will come from Howard Halpern of Taglich Brothers. -------------------------------------------------------------------------------- Howard Allen Halpern, Taglich Brothers, Inc., Research Division - Senior Equity Analyst [11] -------------------------------------------------------------------------------- Congratulations, guys. I entered a little late, so apologize if you had given these numbers. But in the real estate segment, how many offices do you have? And have you discussed -- if you -- plans to expand offices? Or are you just going to maintain it at least through the first half of next year? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [12] -------------------------------------------------------------------------------- We have -- with the merging of the leadership teams now with talent kind of merging with the multifamily leadership team, they're right at 57. We're always looking to open an office, but we will be cautiously optimistic of how that looks going forward, but we have identified potential markets in the event we want to pull the triggers on those to be ready to be able to do that. -------------------------------------------------------------------------------- Howard Allen Halpern, Taglich Brothers, Inc., Research Division - Senior Equity Analyst [13] -------------------------------------------------------------------------------- Okay. And I don't know if you discussed a little bit about the acquisitions that -- the 2 most recent acquisitions that were made. And then you just mentioned, Dan just mentioned how things are a little bit on fire in the Professional services. Are those 2 acquisitions driving that? Or is it overall Professional services that are doing very well? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [14] -------------------------------------------------------------------------------- I think it's overall. I will say that these -- I'm so happy we did these 2 acquisitions. They are so complementary to what we do that they did nothing but help us in propping up that division. But I think that they've done a really good job in merging that management team and getting to know each other, so to speak. So they all play very nice in the sandbox and really have been going pretty strong in that. But those 2 acquisitions, I'm incredibly thankful for. They were really, really good ones for us, the whole division has done well. -------------------------------------------------------------------------------- Howard Allen Halpern, Taglich Brothers, Inc., Research Division - Senior Equity Analyst [15] -------------------------------------------------------------------------------- Okay. And on the Light Industrial side, I know you had talked about business strengthening because of the pandemic and the logistical end of warehouses. But are you going to be able to maintain the gross margin in that segment? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [16] -------------------------------------------------------------------------------- We're actually seeing an improvement in margin on the things that we are selling right now, which is always positive. But I think that companies are having to realize that they're having to up their game because there is kind of a shortage in that area between people who don't necessarily want to go to work in a warehouse and the fact that everybody means people and warehouses right now. But we are -- the team has done an amazing job in being able to upsell our services and get a very nice margin percentage out of it. -------------------------------------------------------------------------------- Howard Allen Halpern, Taglich Brothers, Inc., Research Division - Senior Equity Analyst [17] -------------------------------------------------------------------------------- Okay. And one final one is a little bit going forward. But what do you hope to achieve in reducing your level of debt over the next 12 months? -------------------------------------------------------------------------------- Dan Hollenbach, BG Staffing, Inc. - CFO & Secretary [18] -------------------------------------------------------------------------------- Well, that would be giving forward-looking numbers, Howard, but we -- yes, sorry. -------------------------------------------------------------------------------- Operator [19] -------------------------------------------------------------------------------- The next question is from Michael Taglich of Taglich Brothers. -------------------------------------------------------------------------------- Michael Nicholas Taglich, Taglich Brothers, Inc. - Co-Founder, President, Chairman and Finance & Operations Principal [20] -------------------------------------------------------------------------------- Good recovery quarter, very good, and thank you for doubling the dividend. I -- so first of all, thanks for working hard, I know COVID's not been easy. Looking forward towards the towards the easing of COVID over the next -- over the coming quarters, how do you see -- what's your guess about how it affects the real estate business going forward as it -- how quick do we get back to normal? How do you see it? What's your guess? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [21] -------------------------------------------------------------------------------- Well, right now, there was -- last week was the national -- actually, it was this week, the National Apartment Association Conference was this week and so there was a lot of talk about that. And I think they're just being really, really cautious right now. This eviction moratorium, there's conversations now that it could be pushed out until April. So again, people are holding cash. So I mean we're going to take a conservative approach on it. And Q1 is typically a slow quarter for us to begin with. So we're going to kind of maintain a flat level and then kind of ease into it. But we do think it's going to come back. And I'm -- the team has really had -- and the industry, I will say, has had to really go in and change how they do sales. This is a very active sales group. I think I've mentioned in the past that they did 100 events a month. And those were events where they got, that's where they sell. They went to association meetings. They went to different things. And so the whole industry has had to learn how to sell differently. And our team has done a really, really good job in figuring out what that means. And we're starting to see that traction. So I'm optimistic that the whole industry as a whole is really kind of taking a slow response to what they think is going to happen. -------------------------------------------------------------------------------- Michael Nicholas Taglich, Taglich Brothers, Inc. - Co-Founder, President, Chairman and Finance & Operations Principal [22] -------------------------------------------------------------------------------- Is there a lack of evictions or moving because of COVID that will cause some pent-up demand you suspect or how you see it? -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [23] -------------------------------------------------------------------------------- Well, people aren't moving, there's that. There -- I mean the eviction could go one way or another. Evictions could actually help us because we would need to go out and clean up properties if people were evicted out of it. So we have our makeready section to get busy on that. But it just depends on what the properties are going to do in using outside sources. For example, a community that normally has 100 units in that community would typically have 3 maintenance people to help manage that. And right now, they are sticking with their employee of one and not coming through and doing it. And I think that it's just something depending on what the spike and what the result is, if they do lift that and people are evicted, what they end up doing in terms of will they use outside sources or will they try to manage it within? I think, personally, that they'll have to use some outside sources. I think the last time I counted, there was something like 20 million people that were at risk. And I do think that... -------------------------------------------------------------------------------- Michael Nicholas Taglich, Taglich Brothers, Inc. - Co-Founder, President, Chairman and Finance & Operations Principal [24] -------------------------------------------------------------------------------- (inaudible) payments. -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [25] -------------------------------------------------------------------------------- Yes. I mean it's a sad situation for all around. -------------------------------------------------------------------------------- Michael Nicholas Taglich, Taglich Brothers, Inc. - Co-Founder, President, Chairman and Finance & Operations Principal [26] -------------------------------------------------------------------------------- Right. All right. Great. Well, listen, I'm looking forward to seeing things get better. And as we segue towards normal, get the dividend closer to where it was and get the earnings where they should be and it would be great. Well, keep up the good work. And I just wanted to thank you for that, too. -------------------------------------------------------------------------------- Dan Hollenbach, BG Staffing, Inc. - CFO & Secretary [27] -------------------------------------------------------------------------------- Thank you, sir. -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [28] -------------------------------------------------------------------------------- Thank you. -------------------------------------------------------------------------------- Operator [29] -------------------------------------------------------------------------------- And this concludes our question-and-answer session. I'll now turn the call back to Beth Garvey for any closing remarks. -------------------------------------------------------------------------------- Beth A. Garvey, BG Staffing, Inc. - President, CEO & Director [30] -------------------------------------------------------------------------------- Thank you, Carrie. We appreciate your time to join us on the call today, and we appreciate your continued support. We look forward to updating you on our fourth quarter year-end 2020 results in March. And please stay safe and have a healthy holiday season. -------------------------------------------------------------------------------- Operator [31] -------------------------------------------------------------------------------- Thank you. The conference has now concluded. Thank you all for attending today's presentation. You may now disconnect your lines. Have a great day.