Insperity Inc. (NSP, Financial), a trusted advisor to America’s best businesses for more than 28 years, provides an array of human resources and business solutions designed to help improve business performance.
Insperity Business Performance Advisors offer the most comprehensive suite of products and services available in the marketplace. Insperity delivers administrative relief, better benefits, reduced liabilities and a systematic way to improve productivity through its premier Workforce Optimization solution. Additional company offerings include Human Capital Management, Payroll Services, Time and Attendance, Performance Management, Organizational Planning, Recruiting Services, Employment Screening, Financial Services, Expense Management, Retirement Services and Insurance Services. Insperity business performance solutions support more than 100,000 businesses with over 2 million employees. With 2014 revenues of $2.4 billion, Insperity operates in 57 offices throughout the United States.
Fourth quarter and full-year results
For the fourth quarter, the company reported adjusted EBITDA of $22.6 million, a 22.4% increase over the fourth quarter 2013. Adjusted net income was $8.9 million and adjusted diluted earnings per share were $0.35, a 45.8% increase over the fourth quarter of 2013. Reported fourth-quarter GAAP net income and earnings per share were $8.2 million and $0.27, respectively.
“Our successful fall selling and retention campaign has reestablished momentum in growth and profitability and set Insperity up for double digit unit growth in 2015,” said Paul J. Sarvadi, Insperity chairman and chief executive officer. “Our long-term strategy to offer a wide array of business performance solutions to establish a broader platform for growth is now in place and producing excellent results.”
Fourth-quarter results
Revenues for the fourth quarter of 2014 increased 7.0% over the fourth quarter of 2013 on a 4.6% increase in the average number of worksite employees paid per month. All three drivers to worksite employee growth, including sales, client retention and net hiring in client base, improved over the fourth quarter of 2013.
The 22.4% increase in adjusted EBITDA over the fourth quarter of 2013 resulted from a 12.6% increase in gross profit on a 6.3% increase in operating expenses.
Full-year results
For the year ended Dec. 31, 2014, the company had adjusted EBITDA of $84.1 million and adjusted diluted earnings per share of $1.19. Reported 2014 GAAP net income was $28.0 million, or $1.05 per share.
Revenues in 2014 were $2.4 billion, an increase of 4.5% over 2013 on a 2.5% increase in the average number of worksite employees paid per month. Sequential quarterly increases in worksite employees accelerated throughout 2014, from 1.6% in the second quarter to 2.6% in the third quarter and 4.0% in the fourth quarter. Gross profit for the year ended Dec. 31, 2014 increased 2.7% to $403.8 million.
“Adjusted EBITDA and earnings per share exceeded our initial budget going into 2014 as we effectively managed our direct costs and operating expenses while accelerating unit growth,”said Douglas S. Sharp, senior vice president of finance, chief financial officer and treasurer.
Cash outlays in 2014 included the repurchase of 693,262 shares at a cost of $20.8 million and dividends totaling $69.5 million, including both our regular quarterly dividend and the $2 per share special dividend declared in December. Working capital at Dec. 31, 2014, was $73.1 million.
Other matters
Separately, the company renewed its revolving credit facility on Feb. 6, 2015. The facility has been increased to $125 million and matures in February 2020. It is available for general corporate purposes and is subject to various covenants that are customary for facilities of this nature.
To end
It is no doubt that the shares of NSP have soared higher and with its current performance it is expected to do so in the near future. The company has been known mostly for beating earning estimates. This time also the company has done the same. Investor may consider adding this company to their portfolio. It is expected to create shareholder returns and according to me it is a buy.
(Source: Company’s Website)
