ASGN Incorporated (ASGN) Bundle
A Brief History of ASGN Incorporated
ASGN Incorporated, established in 1985, has evolved into a leading provider of IT services and solutions across commercial and federal sectors. As of 2024, the company operates through two main segments: Commercial and Federal Government.
Company Overview
ASGN specializes in offering consulting, creative digital marketing, and permanent placement services. Its clientele primarily includes Fortune 1000 companies and large mid-market enterprises. The Federal Government Segment delivers advanced IT solutions to various government entities, including the Department of Defense.
Financial Performance
For the nine months ended September 30, 2024, ASGN reported total revenues of $3.1 billion, reflecting a decrease of 7.8% compared to $3.4 billion during the same period in 2023. The breakdown of revenues by segment is as follows:
| Segment | 2024 Revenue (in millions) | 2023 Revenue (in millions) | Change (%) |
|---|---|---|---|
| Commercial Assignment | 1,332.5 | 1,598.8 | (16.7) |
| Commercial Consulting | 843.5 | 827.0 | 2.0 |
| Federal Government | 938.7 | 950.7 | (1.3) |
| Total | 3,114.7 | 3,376.5 | (7.8) |
Profitability Metrics
ASGN's net income for the first nine months of 2024 was $132.8 million, down from $169.0 million in 2023. The gross profit totaled $897.7 million, a decrease from $975.1 million year-over-year. The gross margin for this period was 28.8%, slightly down from 28.9% in 2023.
Operating Expenses
For the nine months ended September 30, 2024, Selling, General, and Administrative (SG&A) expenses were reported at $623.3 million, a reduction from $640.6 million in the previous year. The amortization of intangible assets decreased to $44.2 million from $53.8 million.
Cash Flow Analysis
Net cash provided by operating activities was $299.8 million for the first nine months of 2024, compared to $340.5 million in the same period of 2023. Investing activities resulted in a cash outflow of $24.0 million, while financing activities incurred a cash outflow of $283.6 million, primarily due to stock repurchases.
Debt and Liquidity
As of September 30, 2024, ASGN's long-term debt was reported at $1.0 billion. The company maintained a strong liquidity position with cash and cash equivalents totaling $166.6 million and full availability under its $500 million revolving credit facility.
Segment Performance
The company’s performance by segment reflects various industry dynamics. The Commercial Segment generated $2.2 billion, accounting for 69.9% of total revenues, while the Federal Government Segment contributed $938.7 million, representing 30.1% of total revenues.
Market Position and Future Outlook
ASGN remains focused on its strategic initiatives to enhance service offerings and expand its market presence. The company is well-positioned to leverage its expertise in IT consulting and government services as it navigates the changing market landscape.
A Who Owns ASGN Incorporated (ASGN)
Major Shareholders
As of 2024, ASGN Incorporated (ASGN) has a diverse ownership structure comprising institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder | Ownership Percentage (%) | Type of Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 10.5 | Institutional Investor |
| BlackRock, Inc. | 9.7 | Institutional Investor |
| Dimensional Fund Advisors LP | 6.1 | Institutional Investor |
| SSgA Funds Management, Inc. | 5.2 | Institutional Investor |
| Wellington Management Group LLP | 4.9 | Institutional Investor |
| Other Institutional Investors | 24.8 | Various |
| Insider Ownership | 2.8 | Executive Officers and Board Members |
| Public Float | 36.0 | Retail Investors |
Institutional Ownership
Institutional investors hold a significant portion of ASGN's shares, indicating strong institutional confidence in the company's prospects. The total institutional ownership stands at approximately 61.3%. The following table provides a breakdown of the top institutional shareholders:
| Institution | Shares Owned | Ownership Percentage (%) |
|---|---|---|
| The Vanguard Group, Inc. | 4.5 million | 10.5 |
| BlackRock, Inc. | 4.1 million | 9.7 |
| Dimensional Fund Advisors LP | 2.6 million | 6.1 |
| SSgA Funds Management, Inc. | 2.2 million | 5.2 |
| Wellington Management Group LLP | 2.1 million | 4.9 |
| Other Institutions | 10.3 million | 24.8 |
Insider Ownership
Insider ownership is a crucial metric as it reflects the confidence of executives in their company. As of 2024, insider ownership is approximately 2.8%, with several executives and board members holding shares:
| Name | Position | Shares Owned |
|---|---|---|
| Peter Dameris | CEO | 300,000 |
| Michael O'Brien | CFO | 150,000 |
| Other Executives | Various | 200,000 |
Stock Performance and Market Trends
ASGN's stock performance has shown fluctuations typical of the staffing and IT services sector. The stock closed at approximately $72.50 on December 31, 2023, with a market capitalization of around $3.2 billion. The following table outlines the stock performance metrics:
| Metric | Value |
|---|---|
| Current Share Price | $72.50 |
| Market Capitalization | $3.2 billion |
| 52-Week High | $85.00 |
| 52-Week Low | $60.00 |
| P/E Ratio | 22.5 |
Conclusion of Ownership Structure
The ownership structure of ASGN Incorporated is characterized by a mix of institutional and retail investors, along with a modest level of insider ownership. This balance indicates a robust interest from institutional investors while retaining a significant public float for retail investors.
ASGN Incorporated (ASGN) Mission Statement
Mission Overview
ASGN Incorporated is committed to delivering innovative IT services and solutions across the commercial and government sectors. The company’s mission emphasizes leveraging advanced technology and skilled professionals to meet the evolving needs of its clients.
Core Values
- Integrity: Upholding ethical standards in all business dealings.
- Excellence: Striving for quality and performance in service delivery.
- Collaboration: Working together with clients and partners to achieve common goals.
- Innovation: Continuously improving and adapting to technological advancements.
Strategic Goals
ASGN aims to enhance its market position by focusing on:
- Expanding service offerings to meet diverse client requirements.
- Investing in talent development and retention.
- Enhancing operational efficiency through technology integration.
Financial Performance Indicators
The financial metrics for ASGN highlight the company's operational effectiveness and market positioning:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenues (in millions) | $1,031.0 | $1,116.8 | -7.7% |
| Net Income (in millions) | $47.5 | $59.4 | -20.4% |
| Gross Profit (in millions) | $300.4 | $322.4 | -6.8% |
| SG&A Expenses (in millions) | $207.5 | $206.0 | 0.7% |
| Operating Income (in millions) | $78.9 | $98.6 | -20.1% |
Segment Performance
ASGN operates through two primary segments: Commercial and Federal Government. The following table summarizes their performance:
| Segment | Q3 2024 Revenues (in millions) | Q3 2023 Revenues (in millions) | Change (%) |
|---|---|---|---|
| Commercial | $718.8 | $782.4 | -8.1% |
| Federal Government | $312.2 | $334.4 | -6.6% |
Market Position
ASGN maintains a significant presence in both commercial and government sectors, with approximately 69.7% of its revenues derived from the Commercial Segment and 30.3% from the Federal Government Segment as of Q3 2024.
Recent Developments
In 2024, ASGN amended its senior secured credit facility, achieving a 50-basis point reduction in the term loan B interest rate, enhancing financial flexibility. The company’s long-term debt stood at approximately $1.0 billion as of September 30, 2024.
Conclusion
The mission of ASGN Incorporated is reflected in its commitment to excellence, integrity, and innovation, driving the company’s strategic goals and operational performance amidst a challenging market landscape.
How ASGN Incorporated (ASGN) Works
Business Segments
ASGN operates through two primary segments: Commercial and Federal Government. The Commercial Segment provides consulting, creative digital marketing, and permanent placement services primarily to large mid-market companies and Fortune 1000 firms. The Federal Government Segment delivers advanced IT solutions to various federal agencies, including the Department of Defense and the intelligence community.
Financial Performance
For the three months ended September 30, 2024, ASGN reported total revenues of $1.031 billion, a decline of 7.7% year-over-year compared to $1.117 billion in the same period in 2023. The revenues by segment are detailed in the table below:
| Segment | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | Change (%) |
|---|---|---|---|
| Commercial - Assignment | $433.8 | $508.2 | (14.6) |
| Commercial - Consulting | $285.0 | $274.2 | 3.9 |
| Federal Government | $312.2 | $334.4 | (6.6) |
| Total | $1,031.0 | $1,116.8 | (7.7) |
Revenue Breakdown
The revenue breakdown for the first nine months of 2024 is as follows:
| Segment | Revenue (2024, in millions) | Revenue (2023, in millions) | Change (%) |
|---|---|---|---|
| Commercial - Assignment | $1,332.5 | $1,598.8 | (16.7) |
| Commercial - Consulting | $843.5 | $827.0 | 2.0 |
| Federal Government | $938.7 | $950.7 | (1.3) |
| Total | $3,114.7 | $3,376.5 | (7.8) |
Gross Profit and Margin
Consolidated gross profit for Q3 2024 was $300.4 million, down from $322.4 million in Q3 2023, reflecting a gross margin of 29.1% in 2024, compared to 28.9% in 2023. The gross profit by segment for Q3 2024 is as follows:
| Segment | Gross Profit (in millions) | Gross Margin (%) |
|---|---|---|
| Commercial | $235.8 | 32.8% |
| Federal Government | $64.6 | 20.7% |
| Total | $300.4 | 29.1% |
Operating Income
For Q3 2024, operating income was $78.9 million, down from $98.6 million in Q3 2023. The operating income for the first nine months of 2024 was $230.2 million, compared to $280.7 million in the prior year.
Expenses
Selling, General, and Administrative (SG&A) expenses for Q3 2024 totaled $207.5 million, slightly up from $206.0 million in Q3 2023. For the first nine months of 2024, SG&A expenses were $623.3 million, down from $640.6 million in the same period of 2023.
Net Income
ASGN reported a net income of $47.5 million for Q3 2024, down from $59.4 million in Q3 2023. For the nine months ended September 30, 2024, net income was $132.8 million, compared to $169.0 million in 2023.
Cash Flow and Liquidity
Net cash provided by operating activities for the first nine months of 2024 was $299.8 million, a decrease from $340.5 million in the same period of 2023. Cash and cash equivalents at the end of September 2024 were $166.6 million.
Long-Term Debt
As of September 30, 2024, ASGN's long-term debt was $1.034 billion, with a carrying amount and fair value slightly less than this figure. The debt structure includes:
| Debt Type | Amount (in millions) | Due Date |
|---|---|---|
| Term Loan B | $495.0 | 2030 |
| Unsecured Senior Notes | $550.0 | 2028 |
| Total | $1,045.0 |
Contract Backlog
As of September 30, 2024, ASGN reported a total contract backlog of $3.128 billion, compared to $3.278 billion a year earlier. The breakdown is as follows:
| Type of Backlog | Amount (in millions) |
|---|---|
| Funded Contract Backlog | $612.2 |
| Negotiated Unfunded Contract Backlog | $2,516.3 |
| Total Contract Backlog | $3,128.5 |
Market Trends and Challenges
ASGN faces challenges in its Commercial Segment due to macroeconomic factors affecting demand, particularly in cyclical business areas. The ongoing evolution of IT services and competition in both segments are significant factors influencing the company's performance and strategy moving forward.
How ASGN Incorporated (ASGN) Makes Money
Overview of Revenue Streams
ASGN Incorporated generates revenue primarily through two segments: Commercial and Federal Government. The Commercial Segment includes IT consulting, creative digital marketing, and permanent placement services, while the Federal Government Segment focuses on providing advanced IT solutions to various government entities.
Revenue Breakdown
The following table outlines ASGN's revenue by segment for the three and nine months ended September 30, 2024, compared to the same periods in 2023:
| Segment | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | 9M 2024 Revenue (in millions) | 9M 2023 Revenue (in millions) |
|---|---|---|---|---|
| Commercial | $718.8 | $782.4 | $2,176.0 | $2,425.8 |
| Federal Government | $312.2 | $334.4 | $938.7 | $950.7 |
| Consolidated Total | $1,031.0 | $1,116.8 | $3,114.7 | $3,376.5 |
Commercial Segment Revenue Sources
The Commercial Segment consists of two main revenue types: Assignment and Consulting services. The revenue breakdown for Q3 2024 is as follows:
| Revenue Type | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) |
|---|---|---|
| Assignment | $433.8 | $508.2 |
| Consulting | $285.0 | $274.2 |
Federal Government Segment Revenue Composition
Federal Government Segment revenues are derived from three contract types:
- Firm-fixed-price
- Time and Materials
- Cost Reimbursable
The revenue breakdown for Q3 2024 is as follows:
| Contract Type | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) |
|---|---|---|
| Firm-Fixed-Price | $92.6 | $107.3 |
| Time and Materials | $128.0 | $126.8 |
| Cost Reimbursable | $91.6 | $100.3 |
Financial Performance Metrics
ASGN's financial performance for the first nine months of 2024 compared to 2023 is detailed in the following table:
| Metric | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Income (in millions) | $132.8 | $169.0 |
| Operating Income (in millions) | $230.2 | $280.7 |
| Gross Profit (in millions) | $897.7 | $975.1 |
| Gross Margin (%) | 28.8% | 28.9% |
Cost Structure
ASGN's cost structure primarily includes costs of services, selling, general, and administrative expenses (SG&A), and amortization of intangible assets. The following table summarizes these costs for the first nine months of 2024:
| Cost Category | 9M 2024 (in millions) | 9M 2023 (in millions) |
|---|---|---|
| Costs of Services | $2,217.0 | $2,401.4 |
| SG&A Expenses | $623.3 | $640.6 |
| Amortization of Intangible Assets | $44.2 | $53.8 |
Debt and Interest Expense
As of September 30, 2024, ASGN's long-term debt amounted to $1.034 billion, with an interest expense of $49.4 million for the first nine months of 2024. The weighted-average interest rate was approximately 6.1%.
Conclusion of Financial Overview
ASGN's diverse revenue streams from both commercial and federal government sectors, along with effective cost management, position it strategically within the IT services market. The company's focus on consulting and assignment services, paired with a solid government contracting base, continues to drive its financial performance.
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Article updated on 8 Nov 2024
Resources:
- ASGN Incorporated (ASGN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of ASGN Incorporated (ASGN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View ASGN Incorporated (ASGN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.