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Heritage Global Inc. Announces Strong 2020 Third Quarter Operating ResultsHeritage Global Inc. (NASDAQ: HGBL) ("Heritage Global," "HGI" or "the Company"), an asset services company specializing in financial and industrial asset transactions, today reported financial results for the third quarter ended September 30, 2020. Heritage Global Chief Executive Officer Ross Dove commented, "Heritage had strong results for the third quarter of 2020, highlighted by net income totaling $1.3 million consistent with the third quarter of 2019 and 28% year-over-year growth in Adjusted EBITDA, which we achieved despite ongoing macroeconomic and political uncertainty. The results reinforced the Company's unique and differentiated business model, with robust growth across our industrial assets business. Looking ahead, we believe rising demand for the re-commerce of used and surplus equipment bodes well for sustained near term performance and profitability of our industrial assets segment, while we expect accelerating volumes and revenue from the financial assets side of the business, driven by an expected step up in the release of nonperforming loans into the market in 2021." "Stepping back, Heritage Global recently completed two important milestone accomplishments that we believe will meaningfully enhance the Company's growth prospects and drive long-term shareholder value. First, Heritage Global's common stock was uplisted to the NASDAQ Stock Market, which enhances our visibility within the investment community, thereby increasing the liquidity of our stock and broadening our institutional shareholder base over time. Second, we completed an underwritten public offering of common stock, raising $9.1 million of net proceeds that will be used to expand the businesses of Heritage Global Capital and Heritage Global Partners." Third Quarter 2020 Summary of Financial Results:
(1) Services revenue represents revenue generated from activities in which Heritage Global acted as an agent by either brokering a transaction or providing some other fee-based service. (2) Asset sales represent revenue generated from activities in which Heritage Global acted in a principal capacity, reselling previously purchased assets. (3) EBITDA and Adjusted EBITDA are commonly used non-GAAP financial measures utilized by management as a supplemental tool to evaluate the underlying operating performance of the Company on an ongoing basis and should be considered together with Heritage Global's GAAP financial measures. Definitions and disclosures regarding non-GAAP financial information including reconciliations are included at the end of the press release. Third Quarter 2020 Highlights:
Third Quarter 2020 Conference Call Management will host a webcast and conference call on Monday, November 9, 2020 at 5:00 pm ET to discuss financial results for the third quarter 2020. Analysts and investors may participate via conference call, using the following dial-in information:
The conference call will also be available in the Investor Relations section of the Company's website at http://www.hginc.com/. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register. A replay of the call will also be available on the Company's website approximately two hours after the live call through November 23, 2020. To access the replay, dial 844-512-2921 (domestic) or 412-317-6671 (international). The replay pin number is 10011714. The replay can also be accessed on the Investor Relations section of the Company's website at http://www.hginc.com/. Definitions and Disclosures Regarding non-GAAP Financial Information The Company defines EBITDA as net income/loss plus depreciation and amortization, interest and other expense, and provision for income taxes. Adjusted EBITDA reflects EBITDA adjusted further to eliminate the effects of stock-based compensation. Management uses EBITDA and Adjusted EBITDA in assessing the Company's results, evaluating the Company's performance and in reaching operating and strategic decisions. Management believes that the presentation of EBITDA and Adjusted EBITDA, when considered together with our GAAP financial statements and the reconciliation to the most directly comparable GAAP financial measure, is useful in providing investors a more complete understanding of the factors and trends affecting the underlying performance of the Company on a historical and ongoing basis. The Company's use of EBITDA and Adjusted EBITDA is not meant to be, and should not be, considered in isolation or as a substitute for, or superior to, any GAAP financial measure. You should carefully evaluate the financial information, below, which reconciles our GAAP reported net income to EBITDA and Adjusted EBITDA for the periods presented (in thousands). About Heritage Global Inc. (www.heritageglobalinc.com) Heritage Global Inc. (NASDAQ: HGBL) is an asset services company specializing in financial and industrial asset transactions. The company provides a full suite of services including market making, acquisitions, dispositions, valuations and secured lending. Heritage Global focuses on identifying, valuing, acquiring and monetizing underlying tangible and intangible assets across twenty-eight global sectors. The company acts as an adviser, as well as a principal, acquiring or brokering turnkey manufacturing facilities, surplus industrial machinery and equipment, industrial inventories, accounts receivable portfolios, intellectual property, and entire business enterprises. Forward-Looking Statements This communication includes forward-looking statements based on our current expectations and projections about future events. For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. While the Company believes the forward-looking statements contained in this communication are accurate, these forward-looking statements represent the Company's beliefs only as of the date of this communication, and there are a number of factors that could cause actual events or results to differ materially from those indicated by such forward-looking statements, including variability in magnitude and timing of asset liquidation transactions, the impact of changes in the U.S. national and global economies, and interest rate and foreign exchange rate sensitivity, as well as other factors beyond the Company's control. Unless required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. For more details on factors that could affect these expectations, please see our filings with the Securities and Exchange Commission. -financial tables follow-
The notes contained in our Quarterly Report on Form 10-Q are an integral part of these consolidated financial statements. -balance sheets follow-
The notes contained in our Quarterly Report on Form 10-Q are an integral part of these consolidated financial statements. - EBITDA and Adjusted EBITDA (non-GAAP measures) reconciliation follows -
The notes contained in our Quarterly Report on Form 10-Q are an integral part of these consolidated financial statements.
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