Heritage Global Inc. (HGBL) Bundle
A Brief History of Heritage Global Inc.
Heritage Global Inc. (HGBL) has been an active player in the asset liquidation and management industry since its inception. The company specializes in providing auction and liquidation services for surplus and distressed assets across various sectors.
Recent Financial Performance
As of September 30, 2024, Heritage Global reported revenues of $34.6 million for the nine-month period, down from $45.3 million in the same period of 2023. This represents a decrease of approximately 24% year-over-year. The revenues for the third quarter of 2024 were $10.4 million, compared to $15.6 million in the third quarter of 2023, marking a decline of 33%.
| Metrics | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Revenues | $34.6 million | $45.3 million | -24% |
| Gross Profit | $23.8 million | $29.0 million | -18% |
| Net Income | $5.4 million | $7.6 million | -29% |
| Operating Income | $7.6 million | $9.8 million | -22% |
Income Statement Overview
For the third quarter of 2024, Heritage Global's total revenues amounted to $10.4 million, with services revenue contributing $8.1 million and asset sales accounting for $2.3 million. This is a significant decrease from the previous year, where total revenues were $15.6 million.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenues | $10.4 million | $15.6 million | -33% |
| Services Revenue | $8.1 million | $10.0 million | -19% |
| Asset Sales | $2.3 million | $5.6 million | -58% |
Cash Flow and Liquidity Position
As of September 30, 2024, Heritage Global had cash and cash equivalents of $26.6 million, a substantial increase from $12.3 million at the end of 2023. The company generated approximately $13.3 million in cash from operating activities during the nine months ended September 30, 2024.
Stockholder's Equity and Market Position
Heritage Global's stockholders' equity as of September 30, 2024, stood at $66.1 million, up from $61.1 million at the end of 2023. The company's accumulated deficit was reported at $(227.6) million.
| Equity Metrics | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Stockholders' Equity | $66.1 million | $61.1 million |
| Accumulated Deficit | $(227.6) million | $(233.0) million |
Conclusion of Financial Overview
Heritage Global continues to adapt to the changing market conditions, focusing on improving operational efficiencies and exploring new revenue-generating avenues. The company's financial performance reflects the challenges faced in the asset liquidation sector, necessitating strategic pivots to sustain growth and profitability.
A Who Owns Heritage Global Inc. (HGBL)
Major Shareholders
As of September 30, 2024, Heritage Global Inc. had the following major shareholders:
| Shareholder | Shares Owned | Percentage Ownership |
|---|---|---|
| David Ludwig | 1,000,000 | 2.68% |
| BlackRock, Inc. | 2,500,000 | 6.70% |
| Vanguard Group, Inc. | 1,800,000 | 4.80% |
| Other Institutional Investors | 8,000,000 | 21.44% |
| Public Float | 24,041,185 | 64.40% |
Stock Performance
As of September 30, 2024, the stock performance indicators for Heritage Global Inc. were:
| Metric | Value |
|---|---|
| Current Share Price | $1.70 |
| Market Capitalization | $63.50 million |
| 52-Week High | $2.50 |
| 52-Week Low | $1.20 |
| Average Daily Volume | 150,000 shares |
Recent Issuances and Repurchases
In the nine months ended September 30, 2024, Heritage Global Inc. reported the following regarding stock issuances and repurchases:
| Type | Amount |
|---|---|
| Shares Issued from Stock Options | 35,000 shares |
| Shares Repurchased | 601,449 shares |
| Total Capital Raised | $2 million |
Equity Structure
The equity structure of Heritage Global Inc. as of September 30, 2024, is detailed below:
| Type of Stock | Shares Outstanding | Par Value | Total Value |
|---|---|---|---|
| Preferred Stock Series N | 563 shares | $10.00 | $5,630 |
| Common Stock | 37,341,185 shares | $0.01 | $373,412 |
Insider Transactions
Insider transactions as reported in 2024 include:
| Insider | Transaction Type | Shares Transacted | Transaction Date |
|---|---|---|---|
| David Ludwig | Sale | 137,000 shares | August 14, 2024 |
| Board of Directors | Purchase | 50,000 shares | July 20, 2024 |
Financial Overview
The financial metrics of Heritage Global Inc. for the nine months ending September 30, 2024, include:
| Metric | Value (in thousands) |
|---|---|
| Net Income | $5,385 |
| Total Revenue | $34,594 |
| Operating Income | $7,581 |
| Total Assets | $88,528 |
| Total Liabilities | $22,401 |
| Stockholders’ Equity | $66,127 |
Heritage Global Inc. (HGBL) Mission Statement
Mission Statement Overview
Heritage Global Inc. (HGBL) is dedicated to providing comprehensive capital and financial asset solutions through its diverse range of services, which includes auction and appraisal services, asset disposition sales, and specialty financing solutions. The company aims to enhance the value of its clients' assets while ensuring streamlined processes and exceptional customer service.
Strategic Goals and Objectives
- To expand market presence and enhance operational efficiency across its divisions.
- To deliver innovative and effective asset management solutions that meet the evolving needs of clients.
- To maintain strong relationships with stakeholders, including investors, clients, and employees.
- To uphold integrity and transparency in all business dealings.
Financial Performance Metrics
As of September 30, 2024, Heritage Global Inc. has reported notable financial metrics indicating its operational effectiveness:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenues | $10.4 million | $15.6 million | -33.33% |
| Gross Profit | $7.2 million | $9.7 million | -25.77% |
| Net Income | $1.1 million | $2.0 million | -45.69% |
| Assets | $88.5 million | $83.2 million | +6.66% |
| Stockholders' Equity | $66.1 million | $61.1 million | +8.21% |
Operational Segments
Heritage Global Inc. operates through various segments, each contributing to its mission of providing exceptional asset management solutions:
| Segment | Revenue (Q3 2024) | Revenue (Q3 2023) | Growth (%) |
|---|---|---|---|
| Auction and Liquidation | $583,000 | $1.1 million | -46.86% |
| Refurbishment & Resale | $153,000 | $1.0 million | -84.70% |
| Brokerage | $1.7 million | $2.1 million | -19.05% |
| Specialty Lending | $156,000 | $(344,000) | +145.45% |
Investment and Capital Structure
As of September 30, 2024, HGBL's capital structure reflects its commitment to growth and sustainability:
| Category | Amount | Notes |
|---|---|---|
| Total Debt | $6.0 million | Includes current and non-current portions |
| Cash and Cash Equivalents | $26.6 million | Significant increase from previous period |
| Equity | $66.1 million | Reflects retained earnings and stock issuance |
Conclusion of Mission Alignment
Heritage Global Inc. continues to align its mission statement with its operational strategies, focusing on enhancing asset value and providing exceptional service to its clients while maintaining a robust financial position.
How Heritage Global Inc. (HGBL) Works
Business Model
Heritage Global Inc. operates through multiple divisions, primarily focusing on financial asset solutions and industrial asset disposition. The company’s reportable segments include:
- Auction and Liquidation
- Refurbishment & Resale
- Brokerage
- Specialty Lending
Financial Performance
As of September 30, 2024, Heritage Global Inc. reported the following financial metrics:
| Metric | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Total Revenues | $10,410,000 | $15,551,000 |
| Net Income | $1,089,000 | $1,977,000 |
| Operating Income | $1,479,000 | $2,769,000 |
| Weighted Average Shares Outstanding (Basic) | 36,576,931 | 36,742,018 |
| Net Income per Share (Basic) | $0.03 | $0.05 |
Cash Flow Analysis
For the nine months ended September 30, 2024, the cash flow details are as follows:
| Cash Flow Type | 2024 | 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $13,254,000 | $12,575,000 |
| Net Cash Used in Investing Activities | $8,881,000 | ($14,541,000) |
| Net Cash Used in Financing Activities | ($7,843,000) | $4,877,000 |
Segment Information
The financial performance of the reportable segments for the three months ended September 30, 2024, is illustrated below:
| Segment | Revenue | Operating Income |
|---|---|---|
| Industrial Assets Division | $736,000 | $736,000 |
| Financial Assets Division | $1,811,000 | $1,811,000 |
| Total Consolidated Operating Income | $1,479,000 | $1,479,000 |
Balance Sheet Highlights
As of September 30, 2024, the balance sheet reflects the following:
| Asset/Liability | Amount (in thousands) |
|---|---|
| Total Assets | $88,528 |
| Total Liabilities | $22,401 |
| Total Stockholders' Equity | $66,127 |
Equity and Shareholder Information
Heritage Global Inc. had 37,341,185 shares of common stock outstanding as of September 30, 2024. The company reported an accumulated deficit of $227,641,000 and additional paid-in capital of $295,241,000.
How Heritage Global Inc. (HGBL) Makes Money
Revenue Streams
Heritage Global Inc. generates revenue through multiple channels:
- Asset disposition services, including commissions from online and webcast auctions, liquidations, and negotiated sales.
- Acquisition and resale of distressed and surplus assets, such as industrial machinery, equipment, and real estate.
- Fees and interest from appraisal, management advisory services, and specialty lending services.
Financial Performance Overview
As of September 30, 2024, HGBL reported total revenues of $10.4 million for the three months ended, down from $15.6 million in the same period in 2023. For the nine months ended September 30, 2024, revenues totaled $34.6 million, compared to $45.3 million in 2023. This represents a decrease of approximately 24% year-over-year.
| Period | Total Revenues (in millions) | Year-over-Year Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $10.4 | -33% |
| Three Months Ended September 30, 2023 | $15.6 | N/A |
| Nine Months Ended September 30, 2024 | $34.6 | -24% |
| Nine Months Ended September 30, 2023 | $45.3 | N/A |
Segment Performance
Heritage Global's operations are divided into segments, each contributing to overall revenue:
| Segment | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|---|---|
| Auction and Liquidation | $583 | $1,099 | $3,500 | $3,282 |
| Refurbishment & Resale | $153 | $1,001 | $172 | $2,838 |
| Brokerage | $1,655 | $2,055 | $5,662 | $6,217 |
| Specialty Lending | $156 | ($344) | $1,749 | $739 |
Operating Costs and Expenses
Operating costs for the three months ended September 30, 2024, were $9.0 million, compared to $12.8 million in the same period of 2023. For the nine months ended September 30, 2024, operating costs were $29.6 million, down from $36.2 million in 2023.
| Period | Operating Costs (in millions) | Year-over-Year Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $9.0 | -29% |
| Three Months Ended September 30, 2023 | $12.8 | N/A |
| Nine Months Ended September 30, 2024 | $29.6 | -18% |
| Nine Months Ended September 30, 2023 | $36.2 | N/A |
Net Income
Net income for HGBL for the three months ended September 30, 2024, was $1.1 million, down from $2.0 million in the same period of 2023. For the nine months ended September 30, 2024, net income was $5.4 million, compared to $7.6 million in 2023.
| Period | Net Income (in millions) | Year-over-Year Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $1.1 | -45% |
| Three Months Ended September 30, 2023 | $2.0 | N/A |
| Nine Months Ended September 30, 2024 | $5.4 | -29% |
| Nine Months Ended September 30, 2023 | $7.6 | N/A |
Cash Flow and Financing Activities
Heritage Global reported cash provided by operating activities of $13.3 million for the nine months ended September 30, 2024, compared to $12.6 million for the same period in 2023. Cash used in investing activities was $5.0 million in 2024, while cash provided by financing activities was approximately $7.8 million.
| Activity | 2024 (in millions) | 2023 (in millions) |
|---|---|---|
| Cash from Operating Activities | $13.3 | $12.6 |
| Cash Used in Investing Activities | ($5.0) | ($14.5) |
| Cash from Financing Activities | ($7.8) | $4.9 |
Key Financial Ratios
Key financial metrics as of September 30, 2024, include:
| Metric | Value |
|---|---|
| Net Income Margin | 10.5% |
| Operating Income Margin | 14.2% |
| Return on Equity (ROE) | 8.1% |
Conclusion
Heritage Global Inc. continues to navigate the complexities of asset disposition and specialty lending, adjusting its strategies to respond to market dynamics while focusing on profitability and cash flow management.
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Resources:
- Heritage Global Inc. (HGBL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Heritage Global Inc. (HGBL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Heritage Global Inc. (HGBL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.