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Insperity Announces Strong Third Quarter Results

Insperity, Inc. (NYSE: NSP), a leading provider of human resources and business performance solutions for America’s best businesses, today reported results for the third quarter ended September 30, 2022. Insperity will be hosting a conference call today at 10:00 a.m. ET to discuss these results and our updated 2022 outlook, and has posted an accompanying presentation to its investor website at http://ir.insperity.com.

  • Q3 average number of WSEEs paid and revenues up 18% and 19%, respectively
  • Q3 net income and diluted EPS of $37.7 million and $0.98, respectively
  • Q3 adjusted EBITDA up 33% to $79.8 million and adjusted EPS up 38% to $1.23
  • YTD average number of WSEEs paid and revenues up 19% and 21%, respectively
  • YTD net income and diluted EPS of $141.2 million and $3.66, respectively
  • YTD adjusted EBITDA up 22% to $273.4 million and adjusted EPS up 21% to $4.38

Third Quarter Results

For the third quarter of 2022, reported net income and diluted earnings per share (“EPS”) were $37.7 million and $0.98, respectively. Adjusted EPS increased 38.2% over the third quarter of 2021 to $1.23. Adjusted EBITDA increased 32.7% to $79.8 million.

The average number of worksite employees (“WSEEs”) paid per month increased 17.8% over Q3 2021 to 303,347 WSEEs. WSEEs paid from new client sales improved over Q3 2021 and client retention remained strong, averaging 99% per month for the quarter. The net gain in our client base continued, although at expected lower levels than Q3 2021, a period when many clients were rehiring employees as the pandemic conditions improved. Revenues in Q3 2022 increased 19.0% to $1.4 billion on the 17.8% increase in paid WSEEs. Revenue per WSEE was up 1.0% as overall pricing was managed to targeted levels given the current inflationary environment, partially offset by a client and worksite employee mix change.

“We are pleased to report continuing strong growth and profitability this quarter and year to date driven by a combination of strong demand for our services and excellent execution by our Insperity employees,” said Paul J. Sarvadi, Insperity chief executive officer and chairman. “We have successfully launched our fall selling and retention campaign, and are focused on finishing an excellent first year of our five year plan and achieving a strong start to 2023.”

Gross profit increased 23.2% over Q3 2021 to $244.6 million on the 17.8% increase in paid WSEEs and a 4.7% increase in gross profit per WSEE per month. Benefits costs were better than expected, driven by lower utilization, including COVID related costs. Gross profit contribution from our workers’ compensation program improved over Q3 2021, further driving the increase in gross profit per WSEE per month.

Operating expenses increased 20.8% over Q3 2021 on the 23.2% increase in gross profit. Operating spend included continued investment in our service personnel given our high growth and a focus on hiring and retention in the current tight labor market. Other Q3 2022 personnel costs included a higher incentive compensation accrual tied to our outperformance. Travel and event costs also increased over Q3 2021, which was more restrictive under the pandemic conditions.

Year-to-Date Results

Revenues for the first nine months of 2022 increased 20.8% to $4.4 billion on an 18.9% increase in paid WSEEs and a 1.7% increase in revenue per WSEE. Gross profit for the first nine months of 2022 increased 18.6% to $770.2 million. Operating expenses increased 16.3% to $570.8 million compared to the 2021 period.

For the nine months ended September 30, 2022, reported net income and diluted EPS were $141.2 million and $3.66, respectively. Adjusted EPS increased 21.0% compared to the first nine months of 2021 to $4.38. Adjusted EBITDA increased 21.8% compared to the first nine months of 2021 to $273.4 million.

Net income per WSEE per month increased 3.8% to $54 in the 2022 period from $52 in the 2021 period. Adjusted EBITDA per WSEE per month was $104 in the 2022 period compared to $102 in the 2021 period.

Gross profit and earnings comparisons are impacted by the non-recurrence of $16.8 million in federal payroll tax refunds received in 2021 related to prior years.

Cash outlays in the first nine months of 2022 included the repurchase of approximately 679,000 shares of stock at a cost of $63.4 million, dividends totaling $56.9 million and capital expenditures of $16.4 million. Adjusted cash totaled $239 million at September 30, 2022 and $280 million is available under our recently expanded $650 million credit facility.

“In spite of the lingering pandemic conditions and the recent economic uncertainty, we have been able to achieve over a 20% increase in Adjusted EBITDA and Adjusted EPS over the first three quarters of this year,” said Douglas S. Sharp, Insperity executive vice president of finance, chief financial officer and treasurer. “While some uncertainty surrounding these factors continues to exist, we remain focused on taking advantage of the ongoing market opportunity and executing our long-term plan as we head into 2023.”

2022 Guidance

The company also announced its updated guidance for 2022, including the fourth quarter of 2022. Please refer to the accompanying financial tables at the end of this press release for the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures.

 

Q4 2022

 

Full Year 2022

 

 

 

 

 

 

 

 

Average WSEEs paid

308,000

310,700

 

295,100

295,800

Year-over-year increase

14.5%

15.5%

 

17.7%

18.0%

 

 

 

 

 

 

 

 

Adjusted EPS

$0.87

$0.98

 

$5.23

$5.37

Year-over-year increase

156%

188%

 

32%

36%

 

 

 

 

 

 

 

 

Adjusted EBITDA (in millions)

$62

$68

 

$335

$342

Year-over-year increase

104%

124%

 

31%

34%

Definition of Key Metrics

Average WSEEs paid - Determined by calculating the company’s cumulative WSEEs paid during the period divided by the number of months in the period.

Adjusted EPS - Represents diluted net income per share computed in accordance with GAAP, excluding the impact of non-cash stock-based compensation.

Adjusted EBITDA - Represents net income computed in accordance with GAAP, plus interest expense, income taxes, depreciation and amortization expense, amortization of SaaS implementation costs and non-cash stock-based compensation.

Conference Call and Webcast

Insperity will be hosting a conference call today at 10:00 a.m. ET to discuss these results, and the guidance discussed in this press release, and answer questions from investment analysts. To listen in, call 888-506-0062 and use conference i.d. number 274789. The call will also be webcast at http://ir.insperity.com. The conference call script will be available at the same website later today. A replay of the conference call will be available at 877-481-4010, with pass code 46882, for one week after the call. The webcast will be archived for one year.

About Insperity

Since 1986, Insperity’s mission has been to help businesses succeed so communities prosper. Offering the most comprehensive suite of scalable HR solutions available in the marketplace, Insperity is defined by an unrivaled breadth and depth of services and level of care. Through an optimal blend of premium HR service and technology, Insperity delivers the administrative relief, reduced liabilities and better benefit solutions that businesses need for sustained growth. With 2021 revenues of $5.0 billion and more than 90 offices throughout the U.S., Insperity is currently making a difference in thousands of businesses and communities nationwide. For more information, visit http://www.insperity.com.

Forward-Looking Statements

The statements contained herein that are not historical facts are forward-looking statements within the meaning of the Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can identify such forward-looking statements by the words “anticipates,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “likely,” “possibly,” “probably,” “could,” “goal,” “opportunity,” “objective,” “target,” “assume,” “outlook,” “guidance,” “predicts,” “appears,” “indicator” and similar expressions. Forward-looking statements involve a number of risks and uncertainties. In the normal course of business, in an effort to help keep our stockholders and the public informed about our operations, from time to time, we may issue such forward-looking statements, either orally or in writing. Generally, these statements relate to business plans or strategies; projected or anticipated benefits or other consequences of such plans or strategies; or projections involving anticipated revenues, earnings, average number of worksite employees, benefits and workers’ compensation costs, or other operating results. We base the forward-looking statements on our current expectations, estimates and projections. We caution you that these statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In addition, we have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Therefore, the actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are:

  • adverse economic conditions;
  • impact of the COVID-19 pandemic, or other future pandemics, including the scope, severity and duration of the pandemic; government responses; regulatory developments; and the related disruptions and economic impact to our business and the small and medium-sized businesses that we serve;
  • labor shortages and increasing competition for highly skilled workers;
  • impact of inflation;
  • vulnerability to regional economic factors because of our geographic market concentration;
  • failure to comply with covenants under our credit facility;
  • our liability for WSEE payroll, payroll taxes and benefits costs, or other liabilities associated with actions of our client companies or WSEEs;
  • increases in health insurance costs and workers’ compensation rates and underlying claims trends, health care reform, financial solvency of workers’ compensation carriers, other insurers or financial institutions, state unemployment tax rates, liabilities for employee and client actions or payroll-related claims;
  • an adverse determination regarding our status as the employer of our WSEEs for tax and benefit purposes and an inability to offer alternative benefit plans following such a determination;
  • cancellation of client contracts on short notice, or the inability to renew client contracts or attract new clients;
  • the ability to secure competitive replacement contracts for health insurance and workers’ compensation insurance at expiration of current contracts;
  • regulatory and tax developments and possible adverse application of various federal, state and local regulations;
  • failure to manage growth of our operations and the effectiveness of our sales and marketing efforts;
  • the impact of the competitive environment and other developments in the human resources services industry, including the PEO industry, on our growth and/or profitability;
  • an adverse final judgment or settlement of claims against Insperity;
  • disruptions of our information technology systems or failure to enhance our service and technology offerings to address new regulations or client expectations;
  • our liability or damage to our reputation relating to disclosure of sensitive or private information as a result of data theft, cyberattacks or security vulnerabilities;
  • failure of third-party providers, data centers or cloud service providers; and
  • our ability to integrate or realize expected returns on our acquisitions.

These factors are discussed in further detail in Insperity’s filings with the U.S. Securities and Exchange Commission. Any of these factors, or a combination of such factors, could materially affect the results of our operations and whether forward-looking statements we make ultimately prove to be accurate.

Any forward-looking statements are made only as of the date hereof and, unless otherwise required by applicable securities laws, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Insperity, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(in thousands)

September 30, 2022

 

December 31, 2021

 

 

 

 

Assets

 

 

 

Cash and cash equivalents

$

562,143

 

 

$

575,812

 

Restricted cash

 

51,829

 

 

 

46,929

 

Marketable securities

 

34,493

 

 

 

31,791

 

Accounts receivable, net

 

558,700

 

 

 

513,306

 

Prepaid insurance

 

30,368

 

 

 

11,285

 

Other current assets

 

51,473

 

 

 

53,312

 

Income taxes receivable

 

 

 

 

12,413

 

Total current assets

 

1,289,006

 

 

 

1,244,848

 

Property and equipment, net

 

196,601

 

 

 

210,723

 

Right of use leased assets

 

56,626

 

 

 

62,830

 

Prepaid health insurance

 

9,000

 

 

 

9,000

 

Deposits

 

186,914

 

 

 

192,927

 

Goodwill and other intangible assets, net

 

12,707

 

 

 

12,707

 

Deferred income taxes, net

 

748

 

 

 

4,892

 

Other assets

 

29,904

 

 

 

15,158

 

Total assets

$

1,781,506

 

 

$

1,753,085

 

 

 

 

 

Liabilities and stockholders' equity

 

 

 

Accounts payable

$

5,466

 

 

$

6,412

 

Payroll taxes and other payroll deductions payable

 

352,129

 

 

 

467,892

 

Accrued worksite employee payroll cost

 

494,986

 

 

 

409,653

 

Accrued health insurance costs

 

64,858

 

 

 

50,001

 

Accrued workers’ compensation costs

 

57,023

 

 

 

50,534

 

Accrued corporate payroll and commissions

 

81,278

 

 

 

74,778

 

Other accrued liabilities

 

65,053

 

 

 

69,303

 

Income taxes payable

 

455

 

 

 

 

Total current liabilities

 

1,121,248

 

 

 

1,128,573

 

Accrued workers’ compensation costs, net of current

 

174,664

 

 

 

192,694

 

Long-term debt

 

369,400

 

 

 

369,400

 

Operating lease liabilities, net of current

 

55,691

 

 

 

64,192

 

Total noncurrent liabilities

 

599,755

 

 

 

626,286

 

Stockholders’ equity:

 

 

 

Common stock

 

555

 

 

 

555

 

Additional paid-in capital

 

139,370

 

 

 

109,179

 

Treasury stock, at cost

 

(716,046

)

 

 

(665,089

)

Retained earnings

 

636,624

 

 

 

553,581

 

Total stockholders’ equity (deficit)

 

60,503

 

 

 

(1,774

)

Total liabilities and stockholders’ equity

$

1,781,506

 

 

$

1,753,085

 

 

Insperity, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

(in thousands, except per share amounts)

Three Months Ended September 30,

 

Nine Months Ended September 30,

2022

2021

Change

 

2022

2021

Change

Operating results:

 

 

 

 

 

 

 

Revenues(1)

$

1,439,160

 

$

1,209,628

 

19.0

%

 

$

4,449,104

 

$

3,681,834

 

20.8

%

Payroll taxes, benefits and workers’ compensation costs

 

1,194,607

 

 

1,011,149

 

18.1

%

 

 

3,678,909

 

 

3,032,356

 

21.3

%

Gross profit

 

244,553

 

 

198,479

 

23.2

%

 

 

770,195

 

 

649,478

 

18.6

%

Salaries, wages and payroll taxes

 

109,525

 

 

89,232

 

22.7

%

 

 

323,486

 

 

286,669

 

12.8

%

Stock-based compensation

 

13,341

 

 

10,362

 

28.7

%

 

 

38,818

 

 

35,965

 

7.9

%

Commissions

 

11,068

 

 

8,724

 

26.9

%

 

 

32,121

 

 

24,694

 

30.1

%

Advertising

 

9,790

 

 

9,507

 

3.0

%

 

 

30,812

 

 

23,804

 

29.4

%

General and administrative expenses

 

38,115

 

 

31,134

 

22.4

%

 

 

115,215

 

 

91,981

 

25.3

%

Depreciation and amortization

 

10,083

 

 

9,917

 

1.7

%

 

 

30,367

 

 

27,715

 

9.6

%

Total operating expenses

 

191,922

 

 

158,876

 

20.8

%

 

 

570,819

 

 

490,828

 

16.3

%

Operating income

 

52,631

 

 

39,603

 

32.9

%

 

 

199,376

 

 

158,650

 

25.7

%

Other income (expense):

 

 

 

 

 

 

 

Interest income

 

2,808

 

 

251

 

1,018.7

%

 

 

3,901

 

 

2,230

 

74.9

%

Interest expense

 

(4,082

)

 

(1,963

)

107.9

%

 

 

(8,698

)

 

(5,537

)

57.1

%

Income before income tax expense

 

51,357

 

 

37,891

 

35.5

%

 

 

194,579

 

 

155,343

 

25.3

%

Income tax expense

 

13,688

 

 

10,595

 

29.2

%

 

 

53,427

 

 

40,971

 

30.4

%

Net income

$

37,669

 

$

27,296

 

38.0

%

 

$

141,152

 

$

114,372

 

23.4

%

Less distributed and undistributed earnings allocated to participating securities

 

 

 

(39

)

(100.0

)%

 

 

(27

)

 

(219

)

(87.7

)%

Net income allocated to common shares

$

37,669

 

$

27,257

 

38.2

%

 

$

141,125

 

$

114,153

 

23.6

%

 

 

 

 

 

 

 

 

Net income per share of common stock

 

 

 

 

 

 

Basic

$

0.99

 

$

0.71

 

39.4

%

 

$

3.70

 

$

2.97

 

24.6

%

Diluted

$

0.98

 

$

0.70

 

40.0

%

 

$

3.66

 

$

2.94

 

24.5

%

____________________________________

(1) Revenues are comprised of gross billings less WSEE payroll costs as follows:

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

(in thousands)

2022

2021

 

2022

2021

 

 

 

 

 

 

Gross billings

$

9,528,695

$

7,994,006

 

$

29,111,243

$

23,682,279

Less: WSEE payroll cost

 

8,089,535

 

6,784,378

 

 

24,662,139

 

20,000,445

Revenues

$

1,439,160

$

1,209,628

 

$

4,449,104

$

3,681,834

Insperity, Inc.

KEY FINANCIAL AND STATISTICAL DATA

(Unaudited)

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2022

2021

Change

 

2022

2021

Change

 

 

 

 

 

 

 

 

Average WSEEs paid

 

303,347

 

257,560

17.8

%

 

 

290,838

 

244,667

18.9

%

Statistical data (per WSEE per month):

 

 

 

 

 

 

 

Revenues(1)

$

1,581

$

1,565

1.0

%

 

$

1,700

$

1,672

1.7

%

Gross profit

 

269

 

257

4.7

%

 

 

294

 

295

(0.3

)%

Operating expenses

 

211

 

206

2.4

%

 

 

218

 

223

(2.2

)%

Operating income

 

58

 

51

13.7

%

 

 

76

 

72

5.6

%

Net income

 

41

 

35

17.1

%

 

 

54

 

52

3.8

%

____________________________________

(1) Revenues per WSEE per month are comprised of gross billings per WSEE per month less WSEE payroll costs per WSEE per month as follows:

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

(per WSEE per month)

2022

2021

 

2022

2021

Gross billings

$

10,470

$

10,346

 

$

11,122

$

10,755

Less: WSEE payroll cost

 

8,889

 

8,781

 

 

9,422

 

9,083

Revenues

$

1,581

$

1,565

 

$

1,700

$

1,672

Insperity, Inc.

Non-GAAP Financial Measures

(Unaudited)

 

Non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of the non-GAAP financial measures used to their most directly comparable GAAP financial measures as provided in the tables below.

 

Non-GAAP Measure

Definition

Benefit of Non-GAAP Measure

Non-bonus payroll cost

Non-bonus payroll cost is a non-GAAP financial measure that excludes the impact of bonus payrolls paid to our WSEEs.

 

Bonus payroll cost varies from period to period, but has no direct impact to our ultimate workers’ compensation costs under the current program.

Our management refers to non-bonus payroll cost in analyzing, reporting and forecasting our workers’ compensation costs.

 

We include these non-GAAP financial measures because we believe they are useful to investors in allowing for greater transparency related to the costs incurred under our current workers’ compensation program.

Adjusted cash, cash equivalents and marketable securities

Excludes funds associated with:

• federal and state income tax withholdings,

• employment taxes,

• other payroll deductions, and

• client prepayments.

We believe that the exclusion of the identified items helps us reflect the fundamentals of our underlying business model and analyze results against our expectations, against prior periods, and to plan for future periods by focusing on our underlying operations. We believe that the adjusted results provide relevant and useful information for investors because they allow investors to view performance in a manner similar to the method used by management and improves their ability to understand and assess our operating performance. Adjusted EBITDA is used by our lenders to assess our leverage and ability to make interest payments.

 

 

 

 

EBITDA

Represents net income computed in accordance with GAAP, plus:

• interest expense,

• income tax expense,

• depreciation and amortization expense, and

• amortization of SaaS implementation costs.

 

 

Adjusted EBITDA

Represents EBITDA plus:

• non-cash stock-based compensation.

 

 

Adjusted net income

Represents net income computed in accordance with GAAP, excluding:

• non-cash stock-based compensation.

 

 

Adjusted EPS

Represents diluted net income per share computed in accordance with GAAP, excluding:

• non-cash stock-based compensation.

Following is a reconciliation of payroll cost (GAAP) to non-bonus payroll costs (non-GAAP):

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

(in thousands, except per WSEE per month)

2022

 

2021

 

2022

 

2021

 

Per

WSEE

 

 

Per

WSEE

 

 

Per

WSEE

 

 

Per

WSEE

 

 

 

 

 

 

 

 

 

 

 

 

Payroll cost

$

8,089,535

 

$

8,889

 

 

$

6,784,378

 

$

8,781

 

 

$

24,662,139

 

$

9,422

 

 

$

20,000,445

 

$

9,083

 

Less: Bonus payroll cost

 

583,703

 

 

641

 

 

 

726,187

 

 

940

 

 

 

3,236,059

 

 

1,236

 

 

 

2,942,817

 

 

1,337

 

Non-bonus payroll cost

$

7,505,832

 

$

8,248

 

 

$

6,058,191

 

$

7,841

 

 

$

21,426,080

 

$

8,186

 

 

$

17,057,628

 

$

7,746

 

% Change period over period

 

23.9

%

 

5.2

%

 

 

18.2

%

 

6.4

%

 

 

25.6

%

 

5.7

%

 

 

12.3

%

 

6.7

%

Following is a reconciliation of cash, cash equivalents and marketable securities (GAAP) to adjusted cash, cash equivalents and marketable securities (non-GAAP):

(in thousands)

September 30, 2022

 

December 31, 2021

 

 

 

 

Cash, cash equivalents and marketable securities

$

596,636

 

$

607,603

Less:

 

 

 

Amounts payable for withheld federal and state income taxes, employment taxes and other payroll deductions

 

321,930

 

 

424,800

Client prepayments

 

35,794

 

 

20,054

Adjusted cash, cash equivalents and marketable securities

$

238,912

 

$

162,749

Following is a reconciliation of net income (GAAP) to EBITDA (non-GAAP) and adjusted EBITDA (non-GAAP):

(in thousands, except per WSEE per month)

Three Months Ended September 30,

 

Nine Months Ended September 30,

2022

 

2021

 

2022

 

2021

 

Per

WSEE

 

 

Per

WSEE

 

 

Per

WSEE

 

 

Per

WSEE

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

37,669

 

$

41

 

 

$

27,296

 

$

35

 

 

$

141,152

 

$

54

 

 

$

114,372

 

$

52

 

Income tax expense

 

13,688

 

 

15

 

 

 

10,595

 

 

14

 

 

 

53,427

 

 

20

 

 

 

40,971

 

 

19

 

Interest expense

 

4,082

 

 

4

 

 

 

1,963

 

 

3

 

 

 

8,698

 

 

3

 

 

 

5,537

 

 

3

 

Amortization of SaaS implementation costs

 

948

 

 

1

 

 

 

 

 

 

 

 

948

 

 

 

 

 

 

 

 

Depreciation and amortization

 

10,083

 

 

12

 

 

 

9,917

 

 

12

 

 

 

30,367

 

 

13

 

 

 

27,715

 

 

12

 

EBITDA

 

66,470

 

 

73

 

 

 

49,771

 

 

64

 

 

 

234,592

 

 

90

 

 

 

188,595

 

 

86

 

Stock-based compensation

 

13,341

 

 

15

 

 

 

10,362

 

 

14

 

 

 

38,818

 

 

14

 

 

 

35,965

 

 

16

 

Adjusted EBITDA

$

79,811

 

$

88

 

 

$

60,133

 

$

78

 

 

$

273,410

 

$

104

 

 

$

224,560

 

$

102

 

% Change period over period

 

32.7

%

 

12.8

%

 

 

4.5

%

 

(6.0

)%

 

 

21.8

%

 

2.0

%

 

 

(10.5

)%

 

(15.0

)%

Following is a reconciliation of net income (GAAP) to adjusted net income (non-GAAP):

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

(in thousands)

2022

2021

 

2022

2021

 

 

 

 

 

 

Net income

$

37,669

 

$

27,296

 

 

$

141,152

 

$

114,372

 

Non-GAAP adjustments:

 

 

 

 

 

Stock-based compensation

 

13,341

 

 

10,362

 

 

 

38,818

 

 

35,965

 

Total non-GAAP adjustments

 

13,341

 

 

10,362

 

 

 

38,818

 

 

35,965

 

Tax effect

 

(3,590

)

 

(2,865

)

 

 

(10,659

)

 

(9,486

)

Total non-GAAP adjustments, net

 

9,751

 

 

7,497

 

 

 

28,159

 

 

26,479

 

Adjusted net income

$

47,420

 

$

34,793

 

 

$

169,311

 

$

140,851

 

% Change period over period

 

36.3

%

 

(1.7

)%

 

 

20.2

%

 

(13.0

)%

Following is a reconciliation of diluted EPS (GAAP) to adjusted EPS (non-GAAP):

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2022

2021

 

2022

2021

 

 

 

 

 

 

Diluted EPS

$

0.98

 

$

0.70

 

 

$

3.66

 

$

2.94

 

Non-GAAP adjustments:

 

 

 

 

 

Stock-based compensation

 

0.35

 

 

0.27

 

 

 

1.01

 

 

0.92

 

Total non-GAAP adjustments

 

0.35

 

 

0.27

 

 

 

1.01

 

 

0.92

 

Tax effect

 

(0.10

)

 

(0.08

)

 

 

(0.29

)

 

(0.24

)

Total non-GAAP adjustments, net

$

0.25

 

$

0.19

 

 

$

0.72

 

$

0.68

 

Adjusted EPS

$

1.23

 

$

0.89

 

 

$

4.38

 

$

3.62

 

% Change period over period

 

38.2

%

 

(2.2

)%

 

 

21.0

%

 

(12.8

)%

Following is a reconciliation of GAAP to non-GAAP financial measures for fourth quarter and full year 2022 guidance:

(in millions, except per share amounts)

 

Q4 2022

Guidance

 

Full Year 2022

Guidance

 

 

 

 

 

Net income

 

$26 - $30

 

$166 - $171

Income tax expense

 

9 - 11

 

63 - 65

Interest expense

 

5

 

13

Amortization of SaaS implementation costs

 

1

 

2

Depreciation and amortization

 

11

 

41

EBITDA

 

52 - 58

 

285 - 292

Stock-based compensation

 

10

 

50

Adjusted EBITDA

 

$62 - $68

 

$335 - $342

 

 

 

 

 

Diluted net income per share of common stock

 

$0.68 - $0.79

 

$4.28 - $4.42

Non-GAAP adjustments:

 

 

 

 

Stock-based compensation

 

0.26

 

1.30

Tax effect

 

(0.07)

 

(0.35)

Total non-GAAP adjustments, net

 

0.19

 

0.95

Adjusted EPS

 

$0.87 - $0.98

 

$5.23 - $5.37

 

Contacts

Investor Relations Contact:

Douglas S. Sharp

Senior Vice President of Finance,

Chief Financial Officer and Treasurer

(281) 348-3232

Investor.Relations@Insperity.com

News Media Contact:

Cynthia Murga

Director of Public Relations

(713) 324-1414

Media@Insperity.com

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