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CLOSED · 03:20 ET
Market ClerkRecap
Sat Oct 24 · markets closed6 signals on Oct 2394 insider buys this week · $48.3MCIRO short report next: Oct 30The week ahead

BGSF

BGSF, INC.
NYSE · INDUSTRIALS · SERVICES-HELP SUPPLY SERVICES
4.36
+0.19 +4.56%
USD · close Oct 23
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Work order
33
FLAG · shorts 33
Insiders, 90 days
0
no open-market filings in 90 days
Congress, 90 days
0 / 0
no disclosures naming it
Big money
0 / 15
none of the tracked funds disclose it
Calls on record
0
nobody we score has called it yet
MKT CAP $46.5MP/E —DIV YIELD —FCF YIELD —REV TTM $92.1M −6.5%NET INCOME −$8.3MNET DEBT $4.9M52W 3.27 – 6.58SEC XBRL · TTM TO Invalid Date

How BGSF rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025
Text kept
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Dropped
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words, now 28,068

New in FY2025

  • Please refer to “Note 4 — Discontinued Operations” in the Notes to the Consolidated Financial Statements of this Annual Report on Form 10-K.
  • Company Overview We provide workforce solutions through the Property Management (apartment communities and commercial buildings) segment that operates primarily within the United States of America (“U.S.”).
  • With the acquisitions of BG Personnel, LP and B G Staff Services Inc., we laid the foundation for our entrance into the Property Management (“PM”) staffing industry.
  • Through a series of acquisitions, we diversified into the professional services markets, which included consulting and staffing solutions for both information technology and finance and accounting as well as managed solutions services, which included both workforce solutions and fixed fee arrangements.
  • We have continuing operations in one industry segment, Property Management, and have discontinued operations the Light Industrial and Professional segments.
  • On May 8, 2024, the Company announced that our Board had initiated a process to evaluate potential strategic alternatives and engaged financial advisors in an endeavor to maximize shareholder value (“Strategic alternatives review”).
  • During December 2024, the Company announced a cost restructuring plan as part of the strategic review process.
  • On June 14, 2025, the Company entered into an Equity Purchase Agreement with INSPYR Solutions Intermediate, LLC, pursuant to which the Company sold substantially all of the outstanding equity and net assets pertaining to the Professional segment (“BGSF Professional”) on September 8, 2025.
  • The BGSF Professional financial results for periods prior to the sale have been reflected as discontinued operations in the Unaudited Consolidated Financial Statements, see “Note 4 - Discontinued Operations.” The Property Management segment provides office and maintenance talent in 44 states and D.C., to property management companies responsible for the apartment communities’ and commercial buildings’ day-to-day operations.
  • The Company normally experiences seasonal fluctuations.
  • The quarterly operating results are affected by the number of billing days in a quarter, as well as the seasonality of client partners’ business.
  • Demand for the Property Management workforce solutions has typically increased in the second quarter and is highest during the third quarter of the year due to the increased turns in multifamily units during the summer months when schools are not in session.
  • Overall first quarter demand can be affected by adverse weather conditions in the winter months.
  • Fiscal Years Ended December 28, 2025 December 29, 2024 December 31, 2023 (dollars in thousands) Revenues $ 93,310 $ 104,402 $ 125,077 Cost of services 59,977 66,033 75,292 Gross profit 33,333 38,369 49,785 Selling, general, and administrative expenses 41,136 42,902 45,402 Contingent consideration adjustment (450) — — Depreciation and amortization 1,550 1,334 1,313 Operating (loss) income (8,903) (5,867) 3,070 Interest expense, net (4,511) (4,921) (5,976) Loss before income taxes from continuing operations (13,414) (10,788) (2,906) Income tax benefit from continuing operations 1,881 2,084 831 Net loss from continuing operations $ (11,533) $ (8,704) $ (2,075) Fiscal Years Ended December 28, 2025 December 29, 2024 December 31, 2023 Revenues 100.0 % 100.0 % 100.0 % Cost of services 64.3 63.2 60.2 Gross profit 35.7 36.8 39.8 Selling, general, and administrative expenses 44.1 41.1 36.3 Contingent consideration adjustment (0.5) — — Depreciation and amortization 1.7 1.3 1.0 Operating (loss) income (9.6) (5.6) 2.5 Interest expense, net (4.8) (4.7) (4.8) Loss before income taxes from continuing operations (14.4) (10.3) (2.3) Income tax benefit from continuing operations 2.1 2.0 0.7 Net loss from continuing operations (12.3) % (8.3) % (1.6) % Fifty-two Week Fiscal Year Ended December 28, 2025 (Fiscal 2025) Compared with Fifty-two Week Fiscal Year Ended December 29, 2024 (Fiscal 2024) Revenues: Fiscal Years Ended December 28, 2025 December 29, 2024 (dollars in thousands) Revenues $ 93,310 $ 104,402 Gross profit $ 33,333 $ 38,369 Gross profit percentage 35.7 % 36.8 % Revenues : Revenues decreased approximately $11.1 million (10.6%).
  • The decrease was primarily due to a 12.1% reduction in billed hours, which was driven by a combination of lower demand from cost pressures on property owners and property management companies and increased competition in certain markets with partial offsets by higher permanent placement business, average bill rate, and multi-family property owners.
  • Gross Profit: Gross profit decreased approximately $5.1 million (13.1%) which is in line with revenues with a partial offset by higher permanent placement business that have no cost of service.
  • Selling, General, and Administrative Expenses: Selling, general and administrative (“SGA”) expenses decreased $1.8 million (4.1%) primarily due to reduced compensation costs on less headcount offset by an increase in strategic alternatives review.
  • The components of SGA expense are detailed in the following table: Fiscal Years Ended December 28, 2025 December 29, 2024 Amount % of Revenue Amount % of Revenue $ Change % Change (dollars in thousands) Selling $ 22,961 24.6 % $ 24,631 23.6 % $ (1,670) (6.8) % General and administrative: Compensation and related 8,290 8.9 9,394 9.0 (1,104) (11.8) % Software 2,875 3.1 2,862 2.7 13 0.5 % Liability insurance 1,149 1.2 999 1.0 150 15.0 % Professional fees 1,938 2.1 1,899 1.8 39 2.1 % Share-based compensation 1,006 1.1 908 0.9 98 10.8 % Strategic alternatives review 2,519 2.7 962 0.9 1,557 161.9 % Other 398 0.4 1,247 1.2 (849) (68.1) % Total $ 41,136 44.1 % $ 42,902 41.1 % $ (1,766) (4.1) % Contingent consideration adjustment: As a result of the certain business developments in Fiscal 2025, the Company recognized a $0.5 million contingent consideration adjustment related to the sale of BGSF Professional, see “Note 4 - Discontinued Operations.” Depreciation and Amortization: Depreciation and amortization charges increased approximately $0.2 million (16.2%) primarily due to higher amortization of intangible assets for computer software depreciation.
  • Interest Expense, net: Interest expense, net decreased $0.4 million (8.3%) primarily from paying the balance on the amended and restated credit agreement with BMO, using the proceeds from the sale of BGSF Professional, which was partially offset by the write off of amortization of debt issuance costs from the BMO May 2025 Waiver and Amendment.
  • Income Tax Benefit: Income tax benefit decreased $0.2 million (9.7%) primarily due to an increased net loss before taxes and a lower effective tax rate in Fiscal 2025, which was partially offset by a $1.5 million valuation allowance recorded during Fiscal 2025 against certain net deferred tax assets generated in the sale of BGSF Professional and lower state tax expense.
  • Fifty-two Week Fiscal Year Ended December 29, 2024 (Fiscal 2024) Compared with Fifty-three Week Fiscal Year Ended December 31, 2023 (Fiscal 2023) Revenues: Fiscal Years Ended December 29, 2024 December 31, 2023 (dollars in thousands) Revenues $ 104,402 $ 125,077 Gross profit $ 38,369 $ 49,785 Gross profit percentage 36.8 % 39.8 % Revenues : Revenues decreased approximately $20.7 million (16.5%).
  • Gross Profit: Gross profit decreased approximately $11.4 million (22.9%).
  • Selling, General, and Administrative Expenses: SGA expenses decreased $2.5 million (5.5%) versus prior year, primarily due to expense reduction and cost control efforts in response to the decline in revenues.
  • The components of SGA expense are detailed in the following table: Fiscal Years Ended December 29, 2024 December 31, 2023 Amount % of Revenue Amount % of Revenue $ Change % Change (dollars in thousands) Selling $ 24,631 23.6 % $ 26,427 21.1 % $ (1,796) (6.8) % General and administrative: Compensation and related 9,394 9.0 10,215 8.2 (821) (8.0) % Software 2,862 2.7 2,720 2.2 142 5.2 % Liability insurance 999 1.0 980 0.8 19 1.9 % Professional fees 1,899 1.8 2,066 1.7 (167) (8.1) % Share-based compensation 908 0.9 957 0.8 (49) (5.1) % Strategic alternatives review 962 0.9 — — 962 — % Other 1,247 1.2 2,037 1.6 (790) (38.8) % Total $ 42,902 41.1 % $ 45,402 36.4 % $ (2,500) (5.5) % Depreciation and Amortization: Depreciation and amortization charges were flat due to the increase in software amortization that was partially offset by the decrease in computer equipment.
  • Interest Expense, net: Interest expense, net decreased $1.1 million (17.7%) primarily due to reduced accretion in Fiscal 2024 on contingent consideration associated with Arroyo Consulting and the lower average balance on the Revolving Facility, which was partially offset by the increase in debt issuance costs.
  • Income Tax Benefit: Income tax benefit increased $1.3 million (150.8%) primarily due to a lower taxable loss in Fiscal 2023.
  • Our primary sources of liquidity were cash generated from operations and borrowings under our amended and restated credit agreement with BMO, that provided for a revolving credit facility (the “Revolving Facility”).
  • On September 8, 2025, we paid the balance on the existing Term Loan and Revolving Facility using the proceeds from the sale of BGSF Professional.
  • We do not currently have access to a revolving credit facility.
  • On September 30, 2025, we paid a $2.00 per share special cash dividend.
  • We believe that the cash generated from operations will be sufficient to meet our normal working capital needs for at least the next twelve months, including investments made, and expenses incurred, in connection with opening new markets throughout the next year.
  • If our future cash flow from operations and other capital resources are insufficient to fund our liquidity needs, we may be forced to obtain new debt or equity capital.
  • While we believe we have sufficient liquidity and capital resources to meet our current operating requirements and expansion plans, we may elect to pursue additional growth opportunities within the next year that could require new debt or equity financing.
  • If we are unable to secure new financing at favorable terms in order to pursue such additional growth opportunities, our ability to pursue such opportunities could be materially and adversely affected.
  • A summary of our working capital, operating, investing, and financing activities are shown in the following table: Fiscal Years Ended December 28, 2025 December 29, 2024 December 31, 2023 (dollars in thousands) Working capital from continuing operations (1) $ 29,116 $ 6,897 $ (38,156) Net cash (used in) provided by continuing operations: Operating activities $ 117 $ 19,385 $ 12,922 Investing activities 91,390 (1,217) (2,152) Financing activities (72,521) (18,136) (10,770) Cash and cash equivalents, beginning of year 32 — — Net change in cash and cash equivalents, continuing operations $ 19,018 $ 32 $ — (1) The 2023 working capital amount includes the movement of the balances from long-term to current liabilities related to the amended credit agreement with BMO Harris Bank, N.A.
  • Operating Activities Cash provided by operating activities consists of net loss adjusted for non-cash items, including depreciation and amortization, share-based compensation expense, interest expense, and provision for credit losses.
  • The primary drivers of cash inflows and outflows are accounts receivable, transition services payable, other current assets, and accrued payroll and expenses.
  • During Fiscal 2025, net cash provided by continuing operating activities was $0.1 million, a decrease of $19.3 million compared with $19.4 million net cash provided by continuing operating activities for Fiscal 2024.
  • This decrease is primarily attributable to decreased receipts on accounts receivable, increased payments on accrued payroll and expenses, increased payments on transition services payable, the recording of an escrow receivable related to the sale of BGSF Professional, and decreased payments on other current assets.
  • During Fiscal 2024, net cash provided by continuing operating activities was $19.4 million, an increase of $6.5 million compared with $12.9 million net cash provided by continuing operating activities for Fiscal 2023.

and 419 more.

Gone since FY2024

  • Please refer to “Note 4 — Discontinued Operations” of our audited consolidated financial statements for information regarding our discontinued operations.
  • Company Overview We provide workforce solutions to our client partners in a variety of industries through our various divisions in IT, Finance & Accounting, Managed Solutions, and Property Management (apartment communities and commercial buildings) and have completed a series of acquisitions including the acquisition of BG Personnel, LP and B G Staff Services Inc. in June 2010, substantially all of the assets of JNA Staffing, Inc. in December 2010, Extrinsic, LLC in December 2011, American Partners, Inc. in December 2012, InStaff in June 2013, D&W in March 2015, VTS in October 2015, Zycron in April 2017, Smart in September 2017, and LJK in December 2019, 100% of the equity of EdgeRock in February 2020, Momentum Solutionz in February 2021, Horn Solutions in 2022, and Arroyo Consulting in 2023.
  • We have continuing operations in two industry segments Property Management and Professional, and had discontinued operations in the Light Industrial segment.
  • We primarily operate within the United States of America.
  • On May 8, 2024, we announced that our Board of Directors has initiated a process to evaluate potential strategic alternatives and engaged financial advisors in an endeavor to maximize shareholder value (“Strategic alternatives review”).
  • On March 21, 2022, we sold substantially all of the assets and certain liabilities of InStaff to Sentech Engineering Services, Inc.
  • The Light Industrial segment provided field talent primarily to manufacturing, distribution, logistics, and call center client partners needing a flexible workforce.
  • The InStaff financial results for periods prior to the sale have been reflected in our Consolidated Statements of Operations and Comprehensive (Loss) Income and Consolidated Statements of Cash Flows as discontinued operations.
  • See “Note 4 — Discontinued Operations” of our audited consolidated financial statements for information regarding our discontinued operations.
  • The Property Management segment provides office and maintenance talent in 40 states and D.C., to property management companies responsible for the apartment communities’ and commercial buildings’ day-to-day operations.
  • The Professional segment provides specialized talent and business consultants for information technology (“IT”), managed services, finance, accounting, legal and human resource.
  • The segment operates across the U.S. in three divisions, IT, Managed Solutions, and Finance & Accounting, with the IT division providing additional nearshore and offshore solutions in Colombia and India.
  • Fiscal Year Ended December 29, 2024 December 31, 2023 January 1, 2023 (dollars in thousands) Revenues $ 272,499 $ 313,167 $ 298,422 Cost of services 179,636 201,383 194,874 Gross Profit 92,863 111,784 103,548 Selling, general, and administrative expenses 85,333 88,650 83,211 Gain on contingent consideration (1,452) — — Impairment losses — 22,545 — Depreciation and amortization 7,769 7,774 4,054 Operating income (loss) 1,213 (7,185) 16,283 Interest expense, net (4,921) (5,976) (1,363) (Loss) income before income taxes from continuing operations (3,708) (13,161) 14,920 Income tax benefit (expense) from continuing operations 370 2,938 (3,659) (Loss) income from continuing operations (3,338) (10,223) 11,261 Income from discontinued operations: Income — — 1,235 Gain on sale — — 17,675 Income tax expense — — (4,810) Net (loss) income $ (3,338) $ (10,223) $ 25,361 Fiscal Year Ended December 29, 2024 December 31, 2023 January 1, 2023 Revenues 100.0 % 100.0 % 100.0 % Cost of services 65.9 64.3 65.3 Gross Profit 34.1 35.7 34.7 Selling, general, and administrative expenses 31.3 28.3 27.8 Gain on contingent consideration (0.5) — — Impairment losses — 7.2 — Depreciation and amortization 2.9 2.5 1.4 Operating income (loss) 0.4 (2.3) 5.5 Interest expense, net (1.8) (1.9) (0.5) (Loss) income before income taxes from continuing operations (1.4) (4.2) 5.0 Income tax benefit (expense) from continuing operations 0.2 0.9 (1.2) (Loss) income from continuing operations (1.2) % (3.3) % 3.8 % Fifty-two Week Fiscal Year Ended December 29, 2024 (Fiscal 2024) Compared with Fifty-two Week Fiscal Year Ended December 31, 2023 (Fiscal 2023) Revenues: Fiscal Year Ended December 29, 2024 December 31, 2023 (dollars in thousands) Revenues by Segment: Property Management $ 104,402 38.3 % $ 125,077 39.9 % Professional 168,098 61.7 % 188,090 60.1 % Total Revenues $ 272,500 100.0 % $ 313,167 100.0 % Property Management Revenues : Property Management revenues decreased approximately $20.7 million (16.5%).
  • Professional Revenues : Professional revenues decreased approximately $20.0 million (10.6%).
  • The April 2023 Arroyo Consulting acquisition contributed $5.6 million of incremental revenues with thirty-six weeks in prior period compared to fifty-two weeks in current period.
  • The remaining Professional segment decrease of $25.6 million (13.6%) is primarily due to a decline in billed hours in the Finance and Accounting division, as clients continued to delay projects or expand project timelines using less field talent in the IT division.
  • The Professional segment decrease was partially offset by growth in the Managed Solutions division.
  • Gross Profit: Gross profit represents revenues from workforce solutions less cost of services expenses, which consist of payroll, payroll taxes, payroll-related insurance, field talent costs, and reimbursable costs.
  • Fiscal Year Ended December 29, 2024 December 31, 2023 (dollars in thousands) Gross Profit by Segment: Property Management $ 38,369 41.3 % $ 49,785 44.5 % Professional 54,494 58.7 % 61,999 55.5 % Total Gross Profit $ 92,863 100.0 % $ 111,784 100.0 % Fiscal Year Ended December 29, 2024 December 31, 2023 Gross Profit Percentage by Segment: Property Management 36.8 % 39.8 % Professional 32.4 % 33.0 % Company Gross Profit Percentage 34.1 % 35.7 % Total Company gross profit decreased approximately $18.9 million (16.9%) due to reduced customer demand in both segments.
  • As a percentage of revenue, gross profit has decreased to 34.1% from 35.7%, primarily due to the margin decline in Property Management.
  • Property Management Gross Profit: Property Management gross profit decreased approximately $11.4 million (22.9%).
  • Professional Gross Profit: Professional gross profit decreased approximately $7.5 million (12.1%).
  • The April 2023 Arroyo Consulting acquisition contributed $1.8 million of incremental gross profit with thirty-six weeks in prior period compared to fifty-two weeks in current period.
  • The remaining Professional segment declined $9.3 million (15.0%) primarily due to lower revenue, which was partially offset by growth in the Managed Solutions division.
  • Selling, General, and Administrative Expenses: Selling, general and administrative (“SGA”) expenses decreased $3.3 million (3.7%) primarily due to expense reduction and cost control efforts in response to the decline in revenues.
  • The components of SGA expense are detailed in the following table: Fiscal Year Ended December 29, 2024 December 31, 2023 Amount % of Revenue Amount % of Revenue $ Change % Change (dollars in thousands) Compensation and related $ 62,954 23 % $ 68,536 22 % $ (5,582) (8) % Advertising and recruitment 2,099 1 2,111 1 (12) (1) Occupancy and office operations 3,200 1 3,310 1 (110) (3) Travel, meals and entertainment 1,215 — 1,349 — (134) (10) Software 5,445 2 5,339 2 106 2 Liability insurance 1,136 — 1,140 — (4) — Professional fees 2,113 1 1,413 — 700 50 Public company related costs 1,056 — 851 — 205 24 Bad debt 2,066 1 798 — 1,268 159 Share-based compensation 989 — 1,029 — (40) (4) Strategic alternatives review 962 — — — 962 100 Cost restructuring plan 230 — — — 230 100 Transaction fees 48 — 974 — (926) (95) Workers’ compensation loss retention return (95) — (491) — 396 (81) Other 1,915 1 2,291 1 (376) (16) Total $ 85,333 31 % $ 88,650 28 % $ (3,317) (4) % Gain on contingent consideration: As a result of the certain business developments in Fiscal 2024, the Company recognized a $1.5 million gain on contingent consideration related to the 2023 Arroyo Consulting acquisition.
  • Depreciation and Amortization: Depreciation and amortization charges were flat due to the increase in software amortization that was partially offset by the decrease in client partner lists amortization.
  • Interest Expense, net: Interest expense, net decreased $1.1 million (17.7%) primarily due to reduced accretion in 2024 on contingent consideration associated with Arroyo Consulting and the lower average balance on the Revolving Facility, which was partially offset by the increase in debt issuance costs.
  • Income Taxes: Income tax benefit decreased $2.6 million (87.4%) primarily due to a higher taxable loss in 2023 related to the trade name impairment.
  • Fifty-two Week Fiscal Year Ended December 31, 2023 (Fiscal 2023) Compared with Fifty-three Week Fiscal Year Ended January 1, 2023 (Fiscal 2022) Revenues: Fiscal Year Ended December 31, 2023 January 1, 2023 (dollars in thousands) Revenues by Segment: Property Management $ 125,077 39.9 % $ 121,093 40.6 % Professional 188,090 60.1 % 177,329 59.4 % Total Revenues $ 313,167 100.0 % $ 298,422 100.0 % Property Management Revenues : Property Management revenues increased approximately $4.0 million (3.3%), primarily due to an 8.5% increase in average bill rate.
  • Professional Revenues : Professional revenues increased approximately $10.8 million (6.1%).
  • The 2023 Arroyo Consulting acquisition contributed $14.8 million of new revenues.
  • The Horn Solutions acquisition, which was integrated with the organic business, added revenue that was not enough to offset the decline in the existing professional business.
  • Horn Solutions and the existing professional business declined $4.1 million (2.3%), primarily due to fewer hours billed and lower permanent placement revenue.
  • Fiscal Year Ended December 31, 2023 January 1, 2023 (dollars in thousands) Gross Profit by Segment: Property Management $ 49,785 44.5 % $ 47,695 46.1 % Professional 61,999 55.5 % 55,853 53.9 % Total Gross Profit $ 111,784 100.0 % $ 103,548 100.0 % Fiscal Year Ended December 31, 2023 January 1, 2023 Gross Profit Percentage by Segment: Property Management 39.8 % 39.4 % Professional 33.0 % 31.5 % Company Gross Profit Percentage 35.7 % 34.7 % Total gross profit increased approximately $8.2 million (8.0%).
  • As a percentage of revenue, gross profit has increased to 35.7% from 34.7%, with both segments contributing to the increase.
  • Property Management Gross Profit: Property Management gross profit increased approximately $2.1 million (4.4%), consistent with a 3.3% increase in revenues, partially offset by lower permanent placement revenue, which has no cost of services.
  • Professional Gross Profit: Professional gross profit increased approximately $6.1 million (11.0%).
  • The Arroyo Consulting acquisition contributed $5.1 million in gross profit.
  • The Horn Solutions acquisition, which was integrated with the organic business, added growth to offset the decline experienced in the existing professional business.

and 406 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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