UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March 31,~~June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-35636

ASGN Incorporated

(Exact name of registrant as specified in its charter)

Delaware

95-4023433

(State of Incorporation)

(I.R.S. Employer Identification No.)

4400 Cox Road, Suite 110

Glen Allen, Virginia 23060

(Address, including zip code, of Principal Executive Offices)

(888) 482-8068

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of exchange on which registered

Common Stock

ASGN

NYSE

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

At ~~May~~August 4, 2022, the total number of outstanding shares of the Common Stock of ASGN Incorporated (the "Company") ($0.01 par value) was ~~51.1~~50.2 million.

ASGN INCORPORATED AND SUBSIDIARIES

INDEX


PART I — FINANCIAL INFORMATION

Item 1 — Condensed Consolidated Financial Statements (Unaudited)			3

Condensed Consolidated Balance Sheets			3

Condensed Consolidated Statements of Operations and Comprehensive Income			3

Condensed Consolidated Statements of Stockholders’ Equity			5

Condensed Consolidated Statements of Cash Flows			6

Notes to Condensed Consolidated Financial Statements			7

Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations			1213

Item 3 — Quantitative and Qualitative Disclosures about Market Risks			1517

Item 4 — Controls and Procedures			1517

PART II — OTHER INFORMATION

Item 1 — Legal Proceedings			1518

Item 1A — Risk Factors			1518

Item 2 — Unregistered Sales of Securities and Use of Proceeds			1518

Item 3 — Defaults Upon Senior Securities			1618

Item 4 — Mine Safety Disclosures			1618

Item 5 — Other Information			1618

Item 6 — Exhibits			1719

Signature			1820

PART I — FINANCIAL INFORMATION

Item 1 — Condensed Consolidated Financial Statements (Unaudited)

ASGN INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in millions, except share data)


		March 31, 2022		December 31, 2021			June 30, 2022		December 31, 2021
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	502.4	$	529.6	Cash and cash equivalents	$	490.6	$	529.6
Accounts receivable, net	Accounts receivable, net	775.8		708.2		Accounts receivable, net	843.2		708.2
Prepaid expenses and income taxes	Prepaid expenses and income taxes	17.8		41.2		Prepaid expenses and income taxes	17.2		41.2
Other current assets	Other current assets	16.4		30.4		Other current assets	15.3		30.4
Total current assets	Total current assets	1,312.4		1,309.4		Total current assets	1,366.3		1,309.4
Property and equipment, net	Property and equipment, net	58.6		55.0		Property and equipment, net	59.5		55.0
Operating lease right-of-use assets	Operating lease right-of-use assets	53.7		57.1		Operating lease right-of-use assets	55.2		57.1
Identifiable intangible assets, net	Identifiable intangible assets, net	474.0		487.9		Identifiable intangible assets, net	460.5		487.9
Goodwill	Goodwill	1,569.6		1,569.5		Goodwill	1,560.1		1,569.5
Other non-current assets	Other non-current assets	22.9		23.9		Other non-current assets	22.9		23.9
Total assets	Total assets	$	3,491.2	$	3,502.8	Total assets	$	3,524.5	$	3,502.8
LIABILITIES AND STOCKHOLDERS’ EQUITY	LIABILITIES AND STOCKHOLDERS’ EQUITY					LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	21.4	$	20.1	Accounts payable	$	32.8	$	20.1
Accrued payroll and contract professional pay		312.2		305.5
Accrued payroll						Accrued payroll	337.3		305.5
Operating lease liabilities	Operating lease liabilities	23.0		23.3		Operating lease liabilities	22.5		23.3

Other current liabilities	Other current liabilities	82.5		102.0		Other current liabilities	99.8		102.0
Total current liabilities	Total current liabilities	439.1		450.9		Total current liabilities	492.4		450.9
Long-term debt	Long-term debt	1,034.2		1,033.9		Long-term debt	1,034.5		1,033.9
Operating lease liabilities	Operating lease liabilities	36.7		40.2		Operating lease liabilities	38.4		40.2
Deferred income tax liabilities	Deferred income tax liabilities	89.0		89.0		Deferred income tax liabilities	89.0		89.0
Other long-term liabilities	Other long-term liabilities	23.0		23.4		Other long-term liabilities	14.1		23.4
Total liabilities	Total liabilities	1,622.0		1,637.4		Total liabilities	1,668.4		1,637.4
Commitments and contingencies	Commitments and contingencies	0		0		Commitments and contingencies	0		0
Stockholders’ equity:	Stockholders’ equity:					Stockholders’ equity:
Preferred stock, $0.01 par value; 1.0 million shares authorized; no shares issued	Preferred stock, $0.01 par value; 1.0 million shares authorized; no shares issued	—		—		Preferred stock, $0.01 par value; 1.0 million shares authorized; no shares issued	—		—
Common stock, $0.01 par value; 75.0 million shares authorized; 51.3 million and 51.8 million shares outstanding at March 31, 2022 and December 31, 2021, respectively		0.5		0.5
Common stock, $0.01 par value; 75.0 million shares authorized; 50.4 million and 51.8 million shares outstanding at June 30, 2022 and December 31, 2021, respectively						Common stock, $0.01 par value; 75.0 million shares authorized; 50.4 million and 51.8 million shares outstanding at June 30, 2022 and December 31, 2021, respectively	0.5		0.5
Paid-in capital	Paid-in capital	696.0		690.8		Paid-in capital	692.1		690.8
Retained earnings	Retained earnings	1,173.0		1,174.4		Retained earnings	1,165.5		1,174.4
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(0.3)		(0.3)		Accumulated other comprehensive loss	(2.0)		(0.3)
Total stockholders’ equity	Total stockholders’ equity	1,869.2		1,865.4		Total stockholders’ equity	1,856.1		1,865.4
Total liabilities and stockholders’ equity	Total liabilities and stockholders’ equity	$	3,491.2	$	3,502.8	Total liabilities and stockholders’ equity	$	3,524.5	$	3,502.8

See notes to condensed consolidated financial statements.

ASGN INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited)

(in millions, except per share data)


		Three Months Ended					Three Months Ended					Six Months Ended
		March 31,				June 30,		June 30,
		2022		2021				2022			2021			2022			2021
Revenues	Revenues	$	1,091.0	$	907.0			Revenues	$	1,141.8		$	974.9		$	2,232.8		$	1,881.9
Costs of services	Costs of services	764.4		663.3				Costs of services	797.8			698.6			1,562.2			1,361.9
Gross profit	Gross profit	326.6		243.7				Gross profit	344.0			276.3			670.6			520.0
Selling, general and administrative expenses	Selling, general and administrative expenses	212.1		164.3				Selling, general and administrative expenses	220.4			176.4			432.5			340.7
Amortization of intangible assets	Amortization of intangible assets	13.9		12.0				Amortization of intangible assets	13.5			12.0			27.4			24.0
Operating income	Operating income	100.6		67.4				Operating income	110.1			87.9			210.7			155.3
Interest expense	Interest expense	(9.3)		(9.2)				Interest expense	(10.1)			(9.4)			(19.4)			(18.6)
Income before income taxes	Income before income taxes	91.3		58.2				Income before income taxes	100.0			78.5			191.3			136.7
Provision for income taxes	Provision for income taxes	23.7		15.4				Provision for income taxes	27.4			21.2			51.1			36.6
Income from continuing operations, net of income taxes		67.6		42.8
Income from continuing operations								Income from continuing operations	72.6			57.3			140.2			100.1

Income (loss) from discontinued operations, net of income taxes	Income (loss) from discontinued operations, net of income taxes	(0.8)		5.9				Income (loss) from discontinued operations, net of income taxes	(0.1)			6.9			(0.9)			12.8
Net income	Net income	$	66.8	$	48.7			Net income	$	72.5		$	64.2		$	139.3		$	112.9

Earnings per share:	Earnings per share:							Earnings per share:
Basic —	Basic —							Basic —
Continuing operations	Continuing operations	$	1.31	$	0.81			Continuing operations	$	1.42		$	1.08		$	2.73		$	1.89
Discontinued operations	Discontinued operations	(0.01)		0.11				Discontinued operations	—			0.13			(0.01)			0.24
		$	1.30	$	0.92				$	1.42		$	1.21		$	2.72		$	2.13
Diluted —	Diluted —							Diluted —
Continuing operations	Continuing operations	$	1.29	$	0.80			Continuing operations	$	1.41		$	1.06		$	2.70		$	1.86
Discontinued operations	Discontinued operations	(0.01)		0.11				Discontinued operations	—			0.13			(0.01)			0.24
		$	1.28	$	0.91				$	1.41		$	1.19		$	2.69		$	2.10

Shares and share equivalents used to calculate earnings per share:	Shares and share equivalents used to calculate earnings per share:							Shares and share equivalents used to calculate earnings per share:
Basic	Basic	51.6		53.0				Basic	51.0			53.2			51.3			53.1
Diluted	Diluted	52.3		53.7				Diluted	51.6			53.9			52.0			53.8

Reconciliation of net income to comprehensive income:	Reconciliation of net income to comprehensive income:							Reconciliation of net income to comprehensive income:
Net income	Net income	$	66.8	$	48.7			Net income	$	72.5		$	64.2		$	139.3		$	112.9
Foreign currency translation adjustment	Foreign currency translation adjustment	—		(3.2)				Foreign currency translation adjustment	(1.7)			1.3			(1.7)			(1.9)
Comprehensive income	Comprehensive income	$	66.8	$	45.5			Comprehensive income	$	70.8		$	65.5		$	137.6		$	111.0

See notes to condensed consolidated financial statements.

ASGN INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in millions)


		Common Stock			Paid-in Capital		Retained Earnings		Other			Total				Common Stock			Paid-in Capital		Retained Earnings		Other		Total
		Shares	Par Value								Shares				Par Value
Three Months Ended March 31, 2022
Three Months Ended June 30, 2022														Three Months Ended June 30, 2022
Balance at March 31, 2022														Balance at March 31, 2022		51.3	$	0.5	$	696.0	$	1,173.0	$	(0.3)	$	1,869.2
Stock-based compensation expense														Stock-based compensation expense		—	—		11.2		—		—		11.2

Tax withholding on restricted stock vesting														Tax withholding on restricted stock vesting		—	—		(2.5)		—		—		(2.5)
Stock repurchases and retirement of shares														Stock repurchases and retirement of shares		(0.9)	—		(12.6)		(80.0)		—		(92.6)
Other														Other		—	—		—		—		(1.7)		(1.7)
Net income														Net income		—	—		—		72.5		—		72.5
Balance at June 30, 2022														Balance at June 30, 2022		50.4	$	0.5	$	692.1	$	1,165.5	$	(2.0)	$	1,856.1

Three Months Ended June 30, 2021														Three Months Ended June 30, 2021
Balance at March 31, 2021														Balance at March 31, 2021		53.2	$	0.5	$	674.5	$	975.0	$	(4.2)	$	1,645.8
Stock-based compensation expense														Stock-based compensation expense		—	—		10.8		—		—		10.8

Tax withholding on restricted stock vesting														Tax withholding on restricted stock vesting		—	—		(2.3)		—		—		(2.3)

Other														Other		—	—		—		—		1.3		1.3
Net income														Net income		—	—		—		64.2		—		64.2
Balance at June 30, 2021														Balance at June 30, 2021		53.2	$	0.5	$	683.0	$	1,039.2	$	(2.9)	$	1,719.8

																Common Stock			Paid-in Capital		Retained Earnings		Other		Total
																Shares	Par Value
Six Months Ended June 30, 2022														Six Months Ended June 30, 2022
Balance at December 31, 2021	Balance at December 31, 2021	51.8	$	0.5	$	690.8	$	1,174.4	$	(0.3)		$	1,865.4	Balance at December 31, 2021		51.8	$	0.5	$	690.8	$	1,174.4	$	(0.3)	$	1,865.4
Stock-based compensation expense	Stock-based compensation expense	—	—		12.8		—		—			12.8		Stock-based compensation expense		—	—		24.0		—		—		24.0
Issuances under equity plans	Issuances under equity plans	0.2	—		10.4		—		—			10.4		Issuances under equity plans		0.2	—		10.4		—		—		10.4
Tax withholding on restricted stock vesting	Tax withholding on restricted stock vesting	—	—		(8.8)		—		—			(8.8)		Tax withholding on restricted stock vesting		—	—		(11.3)		—		—		(11.3)
Stock repurchases and retirement of shares		(0.7)	—		(9.2)		(68.2)		—			(77.4)
Stock repurchase and retirement of shares														Stock repurchase and retirement of shares		(1.6)	—		(21.8)		(148.2)		—		(170.0)
Other														Other		—	—		—		—		(1.7)		(1.7)
Net income														Net income		—	—		—		139.3		—		139.3
Balance at June 30, 2022														Balance at June 30, 2022		50.4	$	0.5	$	692.1	$	1,165.5	$	(2.0)	$	1,856.1

Net income		—	—		—		66.8		—			66.8
Balance at March 31, 2022		51.3	$	0.5	$	696.0	$	1,173.0	$	(0.3)		$	1,869.2

Three Months Ended March 31, 2021
Six Months Ended June 30, 2021														Six Months Ended June 30, 2021
Balance at December 31, 2020	Balance at December 31, 2020	52.9	$	0.5	$	661.3	$	926.3	$	(1.0)		$	1,587.1	Balance at December 31, 2020		52.9	$	0.5	$	661.3	$	926.3	$	(1.0)	$	1,587.1
Stock-based compensation expense	Stock-based compensation expense	—	—		10.3		—		—			10.3		Stock-based compensation expense		—	—		21.1		—		—		21.1
Issuances under equity plans	Issuances under equity plans	0.3	—		7.7		—		—			7.7		Issuances under equity plans		0.3	—		7.7		—		—		7.7
Tax withholding on restricted stock vesting	Tax withholding on restricted stock vesting	—	—		(4.8)		—		—			(4.8)		Tax withholding on restricted stock vesting		—	—		(7.1)		—		—		(7.1)

Other	Other	—	—		—		—		(3.2)			(3.2)		Other		—	—		—		—		(1.9)		(1.9)
Net income	Net income	—	—		—		48.7		—			48.7		Net income		—	—		—		112.9		—		112.9
Balance at March 31, 2021		53.2	$	0.5	$	674.5	$	975.0	$	(4.2)		$	1,645.8

Balance at June 30, 2021														Balance at June 30, 2021		53.2	$	0.5	$	683.0	$	1,039.2	$	(2.9)	$	1,719.8

See notes to condensed consolidated financial statements.

ASGN INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in millions)


		Three Months Ended					Six Months Ended
		March 31,					June 30,
		2022		2021			2022		2021
Cash Flows from Operating Activities	Cash Flows from Operating Activities					Cash Flows from Operating Activities
Net income	Net income	$	66.8	$	48.7	Net income	$	139.3	$	112.9
Adjustments to reconcile net income to net cash provided by operating activities:	Adjustments to reconcile net income to net cash provided by operating activities:					Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization	Depreciation and amortization	20.1		22.0		Depreciation and amortization	39.8		43.4
Stock-based compensation	Stock-based compensation	12.8		10.3		Stock-based compensation	24.0		21.1

Other	Other	2.8		1.0		Other	5.1		2.8
Changes in operating assets and liabilities, net of effects of acquisitions and divestiture:	Changes in operating assets and liabilities, net of effects of acquisitions and divestiture:					Changes in operating assets and liabilities, net of effects of acquisitions and divestiture:
Accounts receivable	Accounts receivable	(67.7)		30.3		Accounts receivable	(136.7)		(36.0)
Prepaid expenses and income taxes	Prepaid expenses and income taxes	23.1		3.0		Prepaid expenses and income taxes	23.7		6.8
Accounts payable	Accounts payable	(0.5)		(10.0)		Accounts payable	12.1		(5.8)
Accrued payroll and contract professional pay	Accrued payroll and contract professional pay	6.6		19.3		Accrued payroll and contract professional pay	31.9		50.5
Income taxes payable	Income taxes payable	(1.0)		9.9		Income taxes payable	8.0		17.3
Other	Other	(7.0)		(14.7)		Other	(2.8)		(8.3)
Net cash provided by operating activities	Net cash provided by operating activities	56.0		119.8		Net cash provided by operating activities	144.4		204.7
Cash Flows from Investing Activities	Cash Flows from Investing Activities					Cash Flows from Investing Activities
Cash paid for property and equipment	Cash paid for property and equipment	(9.6)		(9.3)		Cash paid for property and equipment	(18.4)		(17.6)

Cash paid for acquisitions, net of cash acquired						Cash paid for acquisitions, net of cash acquired	—		(85.8)
Cash received from sale of the Oxford business	Cash received from sale of the Oxford business	9.8		—		Cash received from sale of the Oxford business	9.8		—
Other	Other	—		(0.1)		Other	2.5		—
Net cash provided by (used in) investing activities		0.2		(9.4)
Net cash used in investing activities						Net cash used in investing activities	(6.1)		(103.4)
Cash Flows from Financing Activities	Cash Flows from Financing Activities					Cash Flows from Financing Activities

Proceeds from option exercises and employee stock purchase plan	Proceeds from option exercises and employee stock purchase plan	10.4		7.7		Proceeds from option exercises and employee stock purchase plan	10.4		7.7
Repurchases of common stock						Repurchases of common stock	(168.1)		—
Payment of employment taxes related to release of restricted stock awards	Payment of employment taxes related to release of restricted stock awards	(8.8)		(4.8)		Payment of employment taxes related to release of restricted stock awards	(11.3)		(7.1)
Repurchases of common stock		(76.9)		—
Payment of contingent consideration	Payment of contingent consideration	(8.1)		—		Payment of contingent consideration	(8.1)		—
Debt issuance and amendment costs						Debt issuance and amendment costs	—		(0.5)
Net cash provided by (used in) financing activities	Net cash provided by (used in) financing activities	(83.4)		2.9		Net cash provided by (used in) financing activities	(177.1)		0.1
Effect of exchange rate changes on cash and cash equivalents	Effect of exchange rate changes on cash and cash equivalents	—		(1.2)		Effect of exchange rate changes on cash and cash equivalents	(0.2)		(0.4)
Net increase (decrease) in cash and cash equivalents	Net increase (decrease) in cash and cash equivalents	(27.2)		112.1		Net increase (decrease) in cash and cash equivalents	(39.0)		101.0

Cash and cash equivalents at beginning of year	Cash and cash equivalents at beginning of year	529.6		274.4		Cash and cash equivalents at beginning of year	529.6		274.4
Cash and cash equivalents at end of period	Cash and cash equivalents at end of period	$	502.4	$	386.5	Cash and cash equivalents at end of period	$	490.6	$	375.4


Supplemental Disclosure of Cash Flow Information	Supplemental Disclosure of Cash Flow Information					Supplemental Disclosure of Cash Flow Information
Cash paid for —	Cash paid for —					Cash paid for —
Income taxes	Income taxes	$	1.9	$	2.6	Income taxes	$	17.7	$	17.7
Interest	Interest	$	2.4	$	2.4	Interest	$	18.4	$	17.6
Operating leases	Operating leases	$	6.9	$	8.8	Operating leases	$	13.6	$	17.2
Noncash transactions —	Noncash transactions —					Noncash transactions —

Operating lease right of use assets obtained in exchange for operating lease liabilities	Operating lease right of use assets obtained in exchange for operating lease liabilities	$	2.5	$	0.3	Operating lease right of use assets obtained in exchange for operating lease liabilities	$	9.8	$	1.5

See notes to condensed consolidated financial statements.

ASGN INCORPORATED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. General

Basis of presentation — The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and the rules of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations. The December 31, 2021 balance sheet was derived from audited financial statements. The financial statements include adjustments consisting of normal recurring items, which, in the opinion of management, are necessary for a fair presentation of the financial position of ASGN Incorporated and its subsidiaries ("ASGN" or the "Company") and its results of operations for the interim dates and periods set forth herein. The results for any of the interim periods are not necessarily indicative of the results to be expected for the full year or any other period. This Quarterly Report on Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 ("2021 10-K").

2. Acquisitions

~~Retrospective reclassifications~~

In 2021, the Company acquired three consulting services businesses for $221.3 million in cash. As of June 30, 2022, the fair values allocated to the assets and liabilities for these acquisitions have been ~~made to prior period financial statements and disclosures to present the Oxford Global Resources business unit ("Oxford business") as discontinued operations (see~~ ~~Note 2. Discontinued Operations).~~ Unless otherwise noted, amounts and disclosures included herein relate to our continuing operations. Certain reclassifications were also made to prior year amounts to conform with current year presentation.finalized.

2.3. Goodwill and Identifiable Intangible Assets

The following table summarizes the activity related to the carrying amount of goodwill by reportable segment since December 31, 2020 (in millions).


	Commercial		Federal Government		Total




Balance as of December 31, 2020	$	778.6	$	642.1	$	1,420.7
2021 acquisitions	51.1		94.8		145.9
Purchase price adjustments	—		3.3		3.3
Translation adjustment	(0.4)		—		(0.4)
Balance as of December 31, 2021	829.3		740.2		1,569.5

Purchase price adjustments	0.4		(8.5)		(8.1)
Translation adjustment	(1.3)		—		(1.3)


Balance as of June 30, 2022	$	828.4	$	731.7	$	1,560.1

Approximately $127.2 million of the goodwill for the 2021 acquisitions is deductible for income tax purposes.

Acquired identifiable intangible assets consisted of the following (in millions):


		June 30, 2022						December 31, 2021
	Estimated Useful Life in Years	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Customer and contractual relationships	7 - 13	$	493.6	$	283.8	$	209.8	$	493.9	$	260.2	$	233.7
Contractor relationships	4	45.5		45.5		—		45.5		45.5		—
Contract Backlog	1 - 3	34.8		32.9		1.9		34.8		31.0		3.8
Non-compete agreements	1 - 7	29.4		23.2		6.2		29.4		21.6		7.8

		603.3		385.4		217.9		603.6		358.3		245.3
Not subject to amortization:
Trademarks		242.6		—		242.6		242.6		—		242.6
Total		$	845.9	$	385.4	$	460.5	$	846.2	$	358.3	$	487.9

Estimated future amortization expense follows (in millions):


Remainder of 2022	$	27.0
2023	44.5
2024	35.2
2025	28.7
2026	25.1
Thereafter	57.4
	$	217.9

4. Discontinued Operations

On August 17, 2021, the Company sold its Oxford business to an affiliate of H.I.G. Capital for $525.0 million. The gain on the sale was $216.9 million ($168.8 million net of income taxes). The financial results of that business are reported as discontinued operations in the accompanying condensed consolidated statements of operations.

There were no significant operating results from discontinued operations ~~for the three months ended March~~subsequent to December 31, ~~2022~~2021.. The following table summarizes the results of operations of the Oxford business ~~for the three months ended March 31, 2021~~ (in millions).:

~~Revenues~~

~~118.6~~

~~Costs of services~~

~~81.4~~

~~Gross profit~~

~~37.2~~

~~Selling, general and administrative expenses~~

~~29.6~~

~~Amortization of intangible assets~~

~~0.2~~

~~Income before income taxes~~

~~7.4~~

~~Provision for income taxes~~

~~1.5~~

~~Income from discontinued operations, net of income taxes~~

~~5.9~~


	Three Months Ended		Six Months Ended

	June 30, 2021		June 30, 2021
Revenues	$	134.1	$	252.8
Costs of services	92.6		174.0
Gross profit	41.5		78.8
Selling, general and administrative expenses	32.9		62.5
Amortization of intangible assets	0.1		0.3


Income before income taxes	8.5		16.0
Provision for income taxes	1.6		3.2


Income from discontinued operations, net of income taxes	$	6.9	$	12.8

During the ~~three~~six months ended ~~March 31,~~June 30, 2022, the Company received $9.8 million related to the finalization of the purchase price, which mainly related to the settlement of net working capital. ~~There was no other significant cash flow activity related to Oxford in 2022.~~ The following table provides select cash flow information related to the Oxford business for the ~~three~~six months ended ~~March 31,~~June 30, 2021 (in millions):





Net cash provided by operating activities	$	~~5.7~~11.5



Net cash used in investing activities	$	~~(2.1)~~(3.2)

~~3. Acquisitions~~

In 2021, the Company acquired three consulting services businesses for $221.3 million in cash. As of March 31, 2022, the Company had not finalized the determination of fair values allocated to the assets and liabilities for these acquisitions.

~~4. Goodwill and Identifiable Intangible Assets~~

~~The following table summarizes the activity related to the carrying amount of goodwill by reportable segment since December 31, 2020 (in millions).~~

Commercial Federal Government Total
Balance as of December 31, 2020 $ 778.6 $ 642.1 $ 1,420.7
2021 acquisitions 51.1 94.8 145.9
Purchase price adjustments — 3.3 3.3
Translation adjustment (0.4) — (0.4)
Balance as of December 31, 2021 829.3 740.2 1,569.5
Purchase price adjustments 0.3 — 0.3
Translation adjustment (0.2) — (0.2)
Balance as of March 31, 2022 $ 829.4 $ 740.2 $ 1,569.6

~~Approximately $127.2 million of the goodwill for the 2021 acquisitions is deductible for income tax purposes.~~

~~Acquired identifiable intangible assets consisted of the following (in millions):~~

March 31, 2022 December 31, 2021
Estimated Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount
Customer and contractual relationships 7 - 13 $ 493.8 $ 272.0 $ 221.8 $ 493.9 $ 260.2 $ 233.7
Contractor relationships 4 45.4 45.4 — 45.5 45.5 —
Contract Backlog 1 - 3 34.7 31.9 2.8 34.8 31.0 3.8
Non-compete agreements 1 - 7 29.4 22.6 6.8 29.4 21.6 7.8
603.3 371.9 231.4 603.6 358.3 245.3
Not subject to amortization:
Trademarks 242.6 — 242.6 242.6 — 242.6
Total $ 845.9 $ 371.9 $ 474.0 $ 846.2 $ 358.3 $ 487.9

~~Estimated future amortization expense follows (in millions):~~

Remainder of 2022 $ 40.5
2023 44.5
2024 35.2
2025 28.7
2026 25.1
Thereafter 57.4
$ 231.4

5. Long-Term Debt

Long-term debt consisted of the following (in millions):


		March 31, 2022		December 31, 2021			June 30, 2022		December 31, 2021
Senior Secured Credit Facility:	Senior Secured Credit Facility:					Senior Secured Credit Facility:
Borrowings under $250 million revolving credit facility, due 2024	Borrowings under $250 million revolving credit facility, due 2024	$	—	$	—	Borrowings under $250 million revolving credit facility, due 2024	$	—	$	—
Term B loan facility, due 2025	Term B loan facility, due 2025	490.8		490.8		Term B loan facility, due 2025	490.8		490.8

Unsecured Senior Notes, due 2028	Unsecured Senior Notes, due 2028	550.0		550.0		Unsecured Senior Notes, due 2028	550.0		550.0
		1,040.8		1,040.8			1,040.8		1,040.8
Unamortized deferred loan costs	Unamortized deferred loan costs	(6.6)		(6.9)		Unamortized deferred loan costs	(6.3)		(6.9)
		$	1,034.2	$	1,033.9		$	1,034.5	$	1,033.9

Senior Secured Credit Facility — The senior secured credit facility consists of a term B loan and a $250.0 million revolving credit facility. Borrowings under the term B loan bear interest at LIBOR plus 1.75 percent, or the bank’s base rate plus 0.75 percent. Borrowings under the revolver bear interest at LIBOR plus 1.25 to 2.25 percent, or the bank’s base rate plus 0.25 to 1.25 percent, depending on leverage levels. A commitment fee of 0.20 to 0.35 percent is payable on the undrawn portion of the revolver. There are no required minimum payments on the facility. The revolver is limited to a maximum ratio of senior secured debt to trailing 12-months of lender-defined consolidated EBITDA of 3.75 to 1.00, which was ~~0.96~~0.91 to 1.00 at ~~March 31,~~June 30, 2022. The facility is secured by substantially all of the Company's assets and includes various restrictive covenants. At ~~March 31,~~June 30, 2022, the Company was in compliance with its debt covenants. In July 2021, the Company amended its facility to, among other things, permit the sale of its Oxford business and allow the net ~~sale~~cash proceeds (approximately $0.4 billion) to be used for future acquisitions and other permitted investments. With the acquisition of GlideFast Holdings, LLC and affiliated entities ("GlideFast") on July 6, 2022 (see Note 11. Subsequent Events), and other investments ~~provided~~of the ~~Company enters into binding commitments by August 2022 and completes those transactions by February 2023.~~net cash proceeds, prepayments, if any, are expected to be insignificant.

Unsecured Senior Notes — The Company has $550.0 million of unsecured senior notes, which bear interest at 4.625 percent payable semiannually in arrears on May 15 and November 15. These notes are unsecured obligations and are subordinate to the senior secured credit facility. These notes also contain certain customary limitations including, among other terms and conditions, the Company's ability to incur additional indebtedness, engage in mergers and acquisitions, transfer or sell assets and make certain distributions.

6. Commitments and Contingencies

The Company is involved in various legal proceedings, claims and litigation arising in the ordinary course of business. The Company does not believe that the disposition of matters that are pending or asserted will have a material effect on its financial statements.

7. Income Taxes

For interim reporting periods, the Company’s provision for income taxes is calculated using its annualized estimated effective tax rate for the year. This rate is based on its estimated full year income and the related income tax expense for each jurisdiction in which the Company operates. The effective tax rate can be affected by changes in the geographical mix, permanent differences and the estimate of full year pretax accounting income. This rate is adjusted for the effects of discrete items occurring in the period.

8. Earnings per Share

The following table shows the calculation of basic and diluted earnings per share (in millions, except per share data).


		Three Months Ended				Three Months Ended		Six Months Ended
		March 31,				June 30,		June 30,
		2022		2021				2022		2021		2022		2021
Income from continuing operations, net of income taxes		$	67.6	$	42.8
Income from continuing operations							Income from continuing operations	$	72.6	$	57.3	$	140.2	$	100.1
Income (loss) from discontinued operations, net of income taxes	Income (loss) from discontinued operations, net of income taxes	(0.8)		5.9			Income (loss) from discontinued operations, net of income taxes	(0.1)		6.9		(0.9)		12.8
Net income	Net income	$	66.8	$	48.7		Net income	$	72.5	$	64.2	$	139.3	$	112.9

Weighted-average number of common shares outstanding - basic		51.6		53.0
Weighted-average number of common shares outstanding — basic							Weighted-average number of common shares outstanding — basic	51.0		53.2		51.3		53.1
Dilutive effect of common share equivalents	Dilutive effect of common share equivalents	0.7		0.7			Dilutive effect of common share equivalents	0.6		0.7		0.7		0.7
Weighted-average number of common shares and share equivalents outstanding - diluted		52.3		53.7
Weighted-average number of common shares and share equivalents outstanding — diluted							Weighted-average number of common shares and share equivalents outstanding — diluted	51.6		53.9		52.0		53.8

Basic earnings per share:	Basic earnings per share:						Basic earnings per share:
Continuing operations	Continuing operations	$	1.31	$	0.81		Continuing operations	$	1.42	$	1.08	$	2.73	$	1.89
Discontinued operations	Discontinued operations	(0.01)		0.11			Discontinued operations	—		0.13		(0.01)		0.24
		$	1.30	$	0.92			$	1.42	$	1.21	$	2.72	$	2.13
Diluted earnings per share:	Diluted earnings per share:						Diluted earnings per share:
Continuing operations	Continuing operations	$	1.29	$	0.80		Continuing operations	$	1.41	$	1.06	$	2.70	$	1.86
Discontinued operations	Discontinued operations	(0.01)		0.11			Discontinued operations	—		0.13		(0.01)		0.24
		$	1.28	$	0.91			$	1.41	$	1.19	$	2.69	$	2.10

9. Segment Reporting

ASGN provides IT services and solutions and creative digital marketing services across the commercial and government sectors. ASGN operates through its Commercial and Federal Government segments. Virtually all of the Company's revenues are generated in the United States.

The Commercial Segment provides IT services and solutions, and creative digital marketing services to Fortune 1000 and mid-market clients across the United States, Canada and Europe. The Federal Government Segment delivers advanced solutions in cloud, cybersecurity, artificial intelligence, machine learning, application and IT modernization, science and engineering to defense, intelligence and federal civilian agencies. Management evaluates the performance of each segment primarily based on revenues, gross profit and operating income derived directly from internal financial reporting of the segments used for corporate management purposes, which is presented below by segment (in millions):


		Three Months Ended				Three Months Ended		Six Months Ended
		March 31,				June 30,		June 30,
		2022		2021				2022		2021		2022		2021
Commercial	Commercial						Commercial
Revenues	Revenues	$	832.9	$	649.2		Revenues	$	850.6	$	712.5	$	1,683.5	$	1,361.7
Gross profit	Gross profit	272.6		198.7			Gross profit	281.7		228.3		554.3		426.9
Operating income	Operating income	104.9		70.5			Operating income	106.0		89.6		211.0		160.1
Depreciation	Depreciation	3.5		3.5			Depreciation	3.5		3.4		7.1		7.0
Amortization	Amortization	5.6		5.7			Amortization	5.6		5.6		11.3		11.3
Federal Government	Federal Government						Federal Government
Revenues	Revenues	$	258.1	$	257.8		Revenues	$	291.2	$	262.4	$	549.3	$	520.2
Gross profit	Gross profit	54.0		45.0			Gross profit	62.3		48.0		116.3		93.1
Operating income	Operating income	17.3		14.8			Operating income	25.7		18.7		42.7		33.4
Depreciation	Depreciation	1.5		2.4			Depreciation	1.4		2.2		2.9		4.6
Amortization	Amortization	8.3		6.4			Amortization	7.9		6.4		16.2		12.7
Consolidated	Consolidated						Consolidated
Revenues	Revenues	$	1,091.0	$	907.0		Revenues	$	1,141.8	$	974.9	$	2,232.8	$	1,881.9
Gross profit	Gross profit	326.6		243.7			Gross profit	344.0		276.3		670.6		520.0
Operating income	Operating income	100.6		67.4			Operating income	110.1		87.9		210.7		155.3
Depreciation	Depreciation	6.2		7.5			Depreciation	6.1		7.1		12.3		14.6
Amortization	Amortization	13.9		12.0			Amortization	13.5		12.0		27.4		24.0
_______	_______						_______
Consolidated operating income includes corporate operating expenses, which are not allocated to the segments. These include stock-based compensation expense, depreciation expense, compensation for corporate employees, acquisition, integration and strategic planning expenses and public company expenses.	Consolidated operating income includes corporate operating expenses, which are not allocated to the segments. These include stock-based compensation expense, depreciation expense, compensation for corporate employees, acquisition, integration and strategic planning expenses and public company expenses.						Consolidated operating income includes corporate operating expenses, which are not allocated to the segments. These include stock-based compensation expense, depreciation expense, compensation for corporate employees, acquisition, integration and strategic planning expenses and public company expenses.

Virtually all of the revenues from the Commercial Segment are generated from time-and-materials ("T&M") contracts where payments are based on fixed hourly rates for each direct labor hour expended and reimbursements for allowable material costs and out-of-pocket expenses. Revenues from the Federal Government Segment are generated from: (i) firm-fixed-price, (ii) T&M and (iii) cost reimbursable contracts. Virtually all of the Company's revenues are recognized over time. Revenues by segment and by type are as follows (in millions):


		Three Months Ended				Three Months Ended		Six Months Ended
		March 31,				June 30,		June 30,
		2022		2021				2022		2021		2022		2021
Commercial	Commercial						Commercial
Assignment	Assignment	$	628.2	$	531.7		Assignment	$	628.4	$	568.1	$	1,256.6	$	1,099.8
Consulting	Consulting	204.7		117.5			Consulting	222.2		144.4		426.9		261.9
		832.9		649.2				850.6		712.5		1,683.5		1,361.7
Federal Government	Federal Government						Federal Government
Firm-fixed-price	Firm-fixed-price	76.9		60.5			Firm-fixed-price	74.3		62.0		151.2		122.6
Time and materials	Time and materials	107.0		90.7			Time and materials	117.8		100.2		224.8		190.9
Cost reimbursable	Cost reimbursable	74.2		106.6			Cost reimbursable	99.1		100.2		173.3		206.7
		258.1		257.8				291.2		262.4		549.3		520.2
Consolidated	Consolidated	$	1,091.0	$	907.0		Consolidated	$	1,141.8	$	974.9	$	2,232.8	$	1,881.9

Federal Government Segment revenues by customer type are as follows (in millions):


		Three Months Ended				Three Months Ended		Six Months Ended
		March 31,				June 30,		June 30,
		2022		2021				2022		2021		2022		2021
Department of Defense and Intelligence Agencies	Department of Defense and Intelligence Agencies	$	133.6	$	143.3		Department of Defense and Intelligence Agencies	$	159.3	$	141.6	$	292.9	$	284.9
Federal Civilian	Federal Civilian	116.4		92.5			Federal Civilian	120.7		98.8		237.1		191.4
Other	Other	8.1		22.0			Other	11.2		22.0		19.3		43.9
		$	258.1	$	257.8			$	291.2	$	262.4	$	549.3	$	520.2

10. Fair Value Measurements

Recurring Fair Value Measurements — The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued payroll and contract professional pay approximate their fair value based on their short-term nature. The carrying amount of long-term debt recorded in the Company’s balance sheet at ~~March 31,~~June 30, 2022 was $1.0 billion (see Note 5. Long-Term Debt) and its fair value was $1.0 billion, which was determined using quoted prices in active markets for identical liabilities (Level 1 inputs).

Certain acquisitions contain provisions requiring the Company to pay contingent consideration in the event the acquired business achieves certain specified earnings results in 2021 or obtains specified contract awards. Contingent consideration liabilities had a fair value of $15.1 million at December 31, 2021. In the ~~three~~six months ended ~~March 31,~~June 30, 2022, $8.1 million of that liability was paid and is reflected in cash flows from financing activities in the accompanying condensed consolidated statement of cash ~~flows. At March 31, 2022,~~flows and the remaining fair value was reduced to 0 as a measurement period adjustment, with no effect on results of operations. There were no contingent consideration liabilities ~~had a fair value of $7.0 million.~~at June 30, 2022.

Nonrecurring Fair Value Measurements — Certain assets, such as goodwill and trademarks, are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, such as, when there is evidence of impairment. There were no fair value adjustments for non-financial assets or liabilities during the three and six months ended ~~March 31,~~June 30, 2022.

11. Subsequent Events

On July 6, 2022, the Company acquired GlideFast, an Elite ServiceNow provider, for total cash consideration of $350.0 million. The results of operations of GlideFast will be included in the Commercial Segment from the date of acquisition.

On July 27, 2022, the Company's Board of Directors approved a new stock repurchase program under which the Company may repurchase up to $400.0 million of its common stock over the next two years. Under terms of the program, purchases can be made in the open market or under a Rule 10b5-1 trading plan. The stock repurchase program does not obligate the Company to acquire any particular amount of the Company's stock and may be suspended at any time at the Company's discretion. The new program replaces the Company's previous $350.0 million stock repurchase program.

Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations

The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations, as well as management's beliefs and assumptions and involve a high degree of risk and uncertainty. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Statements that include the words "believes," "anticipates," "plans," "expects," "intends," and similar expressions that convey uncertainty of future events or outcomes are forward-looking statements. Our actual results could differ materially from those discussed or suggested in the forward-looking statements herein. Factors that could cause or contribute to such differences include those described in Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2021 ("2021 10-K"). In addition, as a result of these and other factors, our past financial performance should not be relied on as an indication of future performance. All forward-looking statements in this document are based on information available to us as of the filing date of this Quarterly Report on Form 10-Q and we assume no obligation to update any forward-looking statements or the reasons why our actual results may differ.

OVERVIEW

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED ~~MARCH 31,~~JUNE 30, 2022 COMPARED WITH THE THREE MONTHS ENDED ~~MARCH 31,~~JUNE 30, 2021

Revenues

Revenues for the quarter were $1.1 billion, up ~~20.3~~17.1 percent over the ~~first~~second quarter of last ~~year, or 18.7 percent after adjusting for the one additional Billable Day in the quarter.~~year. Revenues for the quarter included ~~$40.2~~approximately $36.3 million from businesses acquired in ~~2021. Adjusting~~2021 accounting for ~~the effects~~3.7 percentage points of the ~~additional Billable Day and the contribution from acquisitions, the organic~~year-over-year growth ~~rate for the quarter was 14.4 percent.~~rate. The table below shows our revenues by segment for the three months ended ~~March 31,~~June 30, 2022 and 2021 (in millions).


								% of Total												% of Total
		2022		2021		Change			2022		2021		Change			2022		2021			Change		2022		2021		Change

Commercial	Commercial														Commercial
Assignment	Assignment	$	628.2	$	531.7	18.1	%		57.6	%	58.6	%	-1.0	%	Assignment	$	628.4	$	568.1		10.6	%	55.0	%	58.3	%	-3.3	%
Consulting	Consulting	204.7		117.5		74.2	%		18.7	%	13.0	%	5.7	%	Consulting	222.2		144.4			53.9	%	19.5	%	14.8	%	4.7	%
		832.9		649.2		28.3	%		76.3	%	71.6	%	4.7	%		850.6		712.5			19.4	%	74.5	%	73.1	%	1.4	%
Federal Government	Federal Government	258.1		257.8		0.1	%		23.7	%	28.4	%	-4.7	%	Federal Government	291.2		262.4			11.0	%	25.5	%	26.9	%	-1.4	%
Consolidated	Consolidated	$	1,091.0	$	907.0	20.3	%		100.0	%	100.0	%			Consolidated	$	1,141.8	$	974.9		17.1	%	100.0	%	100.0	%

Commercial Segment — Revenues from our Commercial Segment ~~(76.3~~(74.5 percent of total revenues) were up ~~28.3~~19.4 percent over the ~~first~~second quarter of last ~~year, including~~year. Assignment revenues totaled $628.4 million (73.9 percent of the segment's revenues), up 10.6 percent year-over-year. Consulting services revenues were $222.2 million (26.1 percent of the segment's revenues), up 53.9 percent year-over-year. Consulting services revenues included approximately ~~$11.9~~$8.8 million ~~in consulting services~~ revenues from a business acquired in 2021.

All commercial divisions (IT services and solutions, creative digital marketing and permanent placement) and revenue streams had double-digit growth over the ~~first~~second quarter of last year with the highest growth coming from our commercial consulting, ~~(virtually all IT services),~~ creative digital marketing and permanent placement services. All five industry verticals: (i) financial services, (ii) consumer and industrials, (iii) healthcare, (iv) technology, media and telecom and (v) business and government services, were also up double-digit year-over-year.

Within the Commercial Segment, IT services and solutions revenues, which accounted for ~~82.7~~83.1 percent of the segment's revenues in the quarter, were up ~~25.8~~19.1 percent over the ~~first~~second quarter of last year driven by high ~~double-digit~~ growth in consulting services ~~revenues~~ and ~~double-digit~~high single-digit growth in assignment revenues. Creative digital marketing and permanent placement revenues, which combined accounted for ~~17.3~~16.9 percent of the segment's revenues in the quarter, were up ~~41.5~~20.6 percent over the ~~first quarter of last year.~~

Assignment revenues, which accounted for 75.4 percent of the segment's revenues, were up 18.1 percent year-over-year driven by double-digit growth in creative digital marketing, permanent placement, and IT assignment revenues. Commercial consulting services revenues, which accounted for 24.6 percent of the segment's revenues, were up 74.2 percent over the firstsecond quarter of last year.

Federal Government Segment — Revenues from our Federal Government Segment ~~(23.7~~(25.5 percent of revenues) were ~~flat year-over-year despite~~up 11.0 percent year-over-year. Revenues for the ~~first~~second quarter included $27.5 million from businesses acquired in the third quarter of last ~~year being~~year. Revenues also included $16.0 million from a ~~difficult prior-year comparable.~~customer-directed, third-party license purchase under a cost reimbursable contract that had been expected to occur in the second half of the year. The ~~first~~second quarter of last year benefited from ~~higher spending levels on certain cost reimbursable contracts and~~approximately $11.8 million in low margin revenues ~~from~~under a ~~low-margin~~ web services ~~contract that~~resale program the segment elected not to ~~not~~ renew in the third quarter of last year. ~~Revenues for the quarter included $28.3 million from businesses acquired in 2021, partially offsetting the effects of the difficult prior-year comparable.~~

1213

Gross Profit and Gross Margin

The table below shows gross profit and gross margin by segment for the three months ended ~~March 31,~~June 30, 2022 and 2021 (in millions).


		Gross Profit						Gross Margin					Gross Profit								Gross Margin
		2022		2021		Change			2022		2021			Change			2022		2021			Change		2022		2021		Change

Commercial	Commercial	$	272.6	$	198.7	37.2	%		32.7	%	30.6	%		2.1	%	Commercial	$	281.7	$	228.3		23.4	%	33.1	%	32.0	%	1.1	%
Federal Government	Federal Government	54.0		45.0		20.0	%		20.9	%	17.5	%		3.4	%	Federal Government	62.3		48.0			29.8	%	21.4	%	18.3	%	3.1	%
Consolidated	Consolidated	$	326.6	$	243.7	34.0	%		29.9	%	26.9	%		3.0	%	Consolidated	$	344.0	$	276.3		24.5	%	30.1	%	28.3	%	1.8	%

Gross profit is comprised of revenues less costs of services, which consist primarily of compensation for our contract professionals, allowable materials and reimbursable out-of-pocket expenses. Consolidated gross profit was up ~~34.0~~24.5 percent on revenue growth of ~~20.3~~17.1 percent.

Gross margin was ~~29.9~~30.1 percent, an expansion of ~~3.0 percentage~~180 basis points over the ~~first~~second quarter of 2021. Both business segments and all operating divisions reported year-over-year expansion in gross margin. The expansion in gross margin of the Commercial Segment was driven by the ~~higher~~double-digit growth of its high-margin services (commercial consulting, creative digital marketing and permanent ~~placement services) than its lower-margin IT staffing services.~~placement). The expansion in gross margin of the Federal Government Segment ~~resulted from: (i) a lower level of revenues from certain cost reimbursable contracts~~was driven by changes in business mix, including ~~a low-margin web services contract that the segment elected to not renew in the third quarter of last year, and (ii)~~ the contribution ~~from~~of high-margin businesses acquired in ~~2021.~~2021, a lower mix of revenues from low-margin services and higher profitability under certain firm fixed price contracts.

Selling, General and Administrative Expenses

Selling, general and administrative ("SG&A") expenses consist primarily of compensation expense for our field operations and corporate staff, rent, information systems, marketing, telecommunications, public company expenses and other general and administrative expenses. SG&A expenses were ~~$212.1~~$220.4 million ~~(19.4~~(19.3 percent of revenues), compared with ~~$164.3~~$176.4 million (18.1 percent of revenues) in the ~~first~~second quarter of 2021. ~~The~~This increase was commensurate with the growth in the business, ~~changes in business mix and investments to support the high~~including growth of ~~the business. These investments were mainly in headcount, employee compensation~~high-margin commercial revenue streams (which carry a higher SG&A expense component than IT staffing and ~~IT applications and systems.~~federal government services revenues).

Amortization of Intangible Assets

Amortization of intangible assets was ~~$13.9~~$13.5 million, up from $12.0 million in the ~~first~~second quarter of 2021. This increase relates to the effects of ~~recently~~the three businesses acquired ~~businesses.~~in 2021.

Interest Expense

Interest expense was ~~$9.3~~$10.1 million and was comprised of ~~$2.4~~$3.3 million of interest on the senior secured credit facility, ~~$6.4~~$6.3 million of interest on the unsecured senior notes, and $0.5 million in amortization of deferred loan costs. The weighted-average outstanding borrowings for the quarter were $1.0 billion and the weighted-average interest rate was ~~3.4~~3.7 percent.

Provision for Income Taxes

The provision for income taxes was ~~$23.7~~$27.4 million, up from ~~$15.4~~$21.2 million in the ~~first~~second quarter of 2021, related to the growth in income before income taxes as the effective tax rate for the current quarter was only slightly ~~lower~~higher than the ~~first~~second quarter of 2021.

Income from Continuing Operations

Income from continuing operations was ~~$67.6~~$72.6 million, up from ~~$42.8~~$57.3 million in the ~~first~~second quarter of 2021 driven by the growth in the business and the expansion of our gross margin.

~~Loss~~Net Income

Net income of $72.5 million was comprised of income from ~~Discontinued~~continuing operations of $72.6 million and loss from discontinued operations of $0.1 million.

RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2022 COMPARED WITH THE SIX MONTHS ENDED JUNE 30, 2021

Revenues

Revenues for the first half of the year were $2.2 billion, up 18.6 percent year-over-year as a result of double-digit organic growth and the revenue contribution of $76.5 million from businesses acquired during 2021. Excluding the contributions from acquisitions, revenues were up 14.6 percent year-over-year. The table below shows our revenues by segment for the six months ended June 30, 2022 and 2021 (in millions).


							% of Total
	2022		2021		Change			2022		2021		Change

Commercial
Assignment	$	1,256.6	$	1,099.8	14.3	%		56.3	%	58.5	%	-2.2	%
Consulting	426.9		261.9		63.0	%		19.1	%	13.9	%	5.2	%
	1,683.5		1,361.7		23.6	%		75.4	%	72.4	%	3.0	%
Federal Government	549.3		520.2		5.6	%		24.6	%	27.6	%	-3.0	%
Consolidated	$	2,232.8	$	1,881.9	18.6	%		100.0	%	100.0	%

Commercial Segment — Revenues from our Commercial Segment (75.4 percent of total revenues) were up 23.6 percent over the first half of last year. Assignment revenues totaled $1.3 billion (74.6 percent of the segment's revenues), up 14.3 percent year-over-year. Consulting services revenues were $426.9 million (25.4 percent of the segment's revenues), up 63.0 percent year-over-year. Consulting services included approximately $20.7 million in revenues from a business acquired in 2021.

All commercial divisions (IT services and solutions, creative digital marketing and permanent placement) and revenue streams had double-digit growth over the first half of last year with the highest growth coming from our commercial consulting, creative digital marketing and permanent placement services. All five industry verticals: (i) financial services, (ii) consumer and industrials, (iii) healthcare, (iv) technology, media and telecom and (v) business and government services, were also up double-digit year-over-year.

Within the Commercial Segment, IT services and solutions revenues, which accounted for 82.9 percent of the segment's revenues in the first half of 2022, were up 22.3 percent over the first half of last year driven by high growth in consulting services and low double-digit growth in assignment revenues. Creative digital marketing and permanent placement revenues, which combined accounted for 17.1 percent of the segment's revenues, were up 30.3 percent over the first half of last year.

Federal Government Segment — Revenues from our Federal Government Segment (24.6 percent of revenues) were up 5.6 percent year-over-year. Revenues for the first half of 2022 included $55.8 million from businesses acquired in the third quarter of last year. Revenues also included $16.0 million from a customer-directed, third-party license purchase under a cost reimbursable contract that had been expected to occur in the second half of the year. Last year benefited from higher spending levels on certain cost reimbursable contracts and revenues from a low-margin web services contract that the segment elected to not renew in the third quarter of last year.

Gross Profit and Gross Margin

The table below shows gross profit and gross margin by segment for the six months ended June 30, 2022 and 2021 (in millions).


	Gross Profit						Gross Margin
	2022		2021		Change			2022		2021		Change

Commercial	$	554.3	$	426.9	29.8	%		32.9	%	31.4	%	1.5	%
Federal Government	116.3		93.1		24.9	%		21.2	%	17.9	%	3.3	%
Consolidated	$	670.6	$	520.0	29.0	%		30.0	%	27.6	%	2.4	%

Consolidated gross profit was up 29.0 percent on revenue growth of 18.6 percent. Gross margin was 30.0 percent, an expansion of 240 basis points over the first half of 2021. Both segments reported expansion in gross margin. The expansion in gross margin of the Commercial Segment was driven by the double-digit growth of its high-margin services (commercial consulting, creative digital marketing and permanent placement services). The expansion in gross margin of the Federal Government Segment was driven by changes in business mix, including the contribution of high-margin businesses acquired in 2021, a lower mix of revenues from low-margin services and higher profitability under certain firm fixed price contracts.

Selling, General and Administrative Expenses

SG&A expenses were $432.5 million (19.4 percent of revenues), compared with $340.7 million (18.1 percent of revenues) in the first six months of 2021. This increase was commensurate with the growth in the business, including growth of high-margin commercial revenue streams (which carry a higher SG&A expense component than IT staffing and federal government services revenues).

Amortization of Intangible Assets

Amortization of intangible assets was $27.4 million, up from $24.0 million in the first six months of 2021. This increase relates to the effects of the three businesses acquired in 2021.

Interest Expense

Interest expense was $19.4 million and was comprised of $5.7 million of interest on the senior secured credit facility, $12.7 million of interest on the unsecured senior notes, and $1.0 million in amortization of deferred loan costs. The weighted-average borrowings outstanding for the first six months of 2022 were approximately $1.0 billion and the weighted-average interest rate was 3.5 percent.

Provision for Income Taxes

The provision for income taxes was $51.1 million, up from $36.6 million in the first six months of 2021, related to the growth in income before taxes as the effective tax rate for the first six months of the year was slightly lower than the first six months of 2021.

Income from Continuing Operations

~~Loss~~Income from ~~discontinued~~continuing operations was ~~$0.8 million.~~$140.2 million, up from $100.1 million for the first six months of 2021 driven by the growth in the business and the expansion of our gross margin.

Net Income

Net income of ~~$66.8~~$139.3 million was comprised of income from continuing operations of ~~$67.6~~$140.2 million and loss from discontinued operations of ~~$0.8~~$0.9 million.

Commercial Segment - Consulting Metrics

Commercial consulting bookings are defined as the value of new contracts entered into during a specified period, including adjustments for the effects of changes in contract scope and contract terminations. The underlying contracts are terminable by the client on short notice with little or no termination penalties. The book-to-bill ratio for our commercial consulting revenues is the ratio of our commercial consulting bookings to the commercial consulting revenues for a specified period. ~~Typically~~The average duration of commercial consulting projects ~~average length~~ is ~~between nine months to~~ one year.

Three Months Ended
(dollars in millions) March 31,
2022 December 31,
2021 September 30,
2021 June 30,
2021 March 31,
2021
Commercial Consulting Bookings $ 297.5 $ 224.9 $ 185.7 $ 217.7 $ 182.0
Book-to-Bill Ratio 1.5 to 1.0 1.2 to 1.0 1.0 to 1.0 1.5 to 1.0 1.5 to 1.0


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(dollars in millions)	2022		2021		2022		2021
Bookings	$	340.6	$	217.7	$	638.1	$	399.7
Book-to-Bill Ratio	1.5 to 1.0		1.5 to 1.0		1.5 to 1.0		1.5 to 1.0

Federal Government Segment Metrics

Contract backlog for our Federal Government Segment represents the estimated amount of future revenues to be recognized under awarded contracts including task orders and options. These estimates are subject to change and may be affected by the execution of new contracts, the extension or early termination of existing contracts, the non-renewal or completion of current contracts and adjustments to estimates for previously included contracts. Changes in the funded contract backlog are also affected by the funding cycles of the government.


(in millions)	(in millions)	March 31, 2022		December 31, 2021		(in millions)	June 30, 2022		December 31, 2021		June 30, 2021
Funded Contract Backlog	Funded Contract Backlog	$	488.4	$	529.2	Funded Contract Backlog	$	455.5	$	529.2	$	449.1
Negotiated Unfunded Contract Backlog	Negotiated Unfunded Contract Backlog	2,382.9		2,472.0		Negotiated Unfunded Contract Backlog	2,395.2		2,472.0		2,272.5
Contract Backlog	Contract Backlog	$	2,871.3	$	3,001.2	Contract Backlog	$	2,850.7	$	3,001.2	$	2,721.6

The book-to-bill ratio for our Federal Government Segment was 0.9 to 1.0 for the trailing-twelve-months ended ~~March 31,~~June 30, 2022. The book-to-bill ratio was calculated as the sum of the change in total contract backlog during the period plus revenues for the period, divided by revenues for the period. The contract backlog coverage ratio (backlog at ~~March 31,~~June 30, 2022 divided by trailing-twelve-months of ~~federal government segment~~Federal Government Segment revenues) was ~~2.6~~2.5 to 1.0.

Liquidity and Capital Resources

Our working capital at ~~March 31,~~June 30, 2022 was ~~$873.3~~$873.9 million, and our cash and cash equivalents were ~~$502.4~~$490.6 million. Our cash flows from operating activities have been our primary source of liquidity and have been sufficient to fund our working capital and capital expenditure needs. At ~~March 31,~~June 30, 2022, we had full availability under our $250.0 million revolving credit facility. We believe that our cash and cash equivalents on hand, expected operating cash flows and availability under our revolving credit facility will be sufficient to fulfill our obligations, working capital requirements and capital expenditures for the next 12 months.

Net cash provided by operating activities was ~~$56.0~~$144.4 million for the first ~~quarter~~half of 2022, compared with ~~$119.8~~$204.7 million in the first ~~quarter~~half of last year. Net cash provided by operating activities before changes in operating assets and liabilities was ~~$102.5~~$208.2 million, up from ~~$82.0~~$180.2 million in

the first ~~quarter~~half of last year. Changes in operating assets and liabilities resulted in net cash usage of ~~$46.5~~$63.8 million, compared with net cash generation of ~~$37.8~~$24.5 million in the first ~~quarter~~half of last year. This change mainly related to the revenue growth in the Commercial Segment and an increase in accounts receivable days sales outstanding.

Net cash ~~provided~~used by investing activities was ~~$0.2~~$6.1 million for the first ~~quarter~~half of 2022 and included $9.8 million in cash received related to the finalization of the purchase price for the sale of the Oxford business and ~~$9.6~~$18.4 million in capital expenditures. Net cash used in investing activities in the first ~~quarter~~half of last year was ~~$9.4~~$103.4 million and was ~~primarily~~comprised of $85.8 million for acquisitions and $17.6 million for capital expenditures.

Net cash used in financing activities was ~~$83.4~~$177.1 million for the first ~~quarter~~half of 2022, compared with net cash provided of ~~$2.9~~$0.1 million in the first ~~quarter~~half of last year. Net cash used in financing activities for the first ~~quarter~~half of 2022 was primarily ~~cash~~comprised of ~~$76.9~~$168.1 million ~~used~~ to repurchase the Company's common stock. There were no repurchases of common stock in the first ~~quarter~~half of last year.

Senior Secured Credit Facility — The senior secured credit facility consists of a term B loan and a $250.0 million revolving credit facility. At ~~March 31,~~June 30, 2022, the Company had $490.8 million outstanding under the term B loan and no outstanding borrowings under the revolver. Borrowings under the term B loan bear interest at LIBOR plus 1.75 percent, or the bank’s base rate plus 0.75 percent. Borrowings under the revolver bear interest at LIBOR plus 1.25 to 2.25 percent, or the bank’s base rate plus 0.25 to 1.25 percent, depending on leverage levels. A commitment fee of 0.20 to 0.35 percent is payable on the undrawn portion of the revolver. There are no required minimum principal payments on the facility until maturity. The facility is secured by substantially all of the Company's assets and includes various restrictive covenants. In July 2021, the Company amended its facility to, among other things, permit the sale of its Oxford business and allow the net sale proceeds (approximately $0.4 billion) to be used for future acquisitions and other permitted investments. With the acquisition of GlideFast on July 6, 2022 (see Note 11. Subsequent Events), and other investments ~~provided~~of the ~~Company enters into binding commitments by August 2022 and completes those transactions by February 2023.~~net cash proceeds, required prepayments, if any, are expected to be insignificant.

Unsecured Senior Notes — The Company has $550.0 million of unsecured senior notes due in 2028, which bear interest at 4.625 percent payable semiannually in arrears on May 15 and November 15. These notes are unsecured obligations and subordinate to the senior secured credit facility. These notes contain certain customary limitations including, among other terms and conditions, our ability to incur additional indebtedness, engage in mergers and acquisitions, transfer or sell assets and make certain distributions.

Recent Accounting Pronouncements

There have been no recent accounting pronouncements that significantly impact the Company.

Critical Accounting Policies

There were no significant changes to our critical accounting policies and estimates during the ~~first~~second quarter of 2022 compared with those disclosed in Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2021 10-K.

Commitments

There were no material changes to the significant commitments or contractual obligations that were disclosed in our 2021 10-K.

Item 3 — Quantitative and Qualitative Disclosures about Market Risks

With respect to our quantitative and qualitative disclosures about interest rates risks, there have been no material changes to the information included in our 2021 10-K. A hypothetical 100 basis-point change in interest rates on variable-rate debt would have resulted in an interest expense fluctuation of approximately $4.9 million based on $490.8 million of debt outstanding for any 12-month period.

Item 4 — Controls and Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Principal Financial and Accounting Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act). Based on this evaluation, our Chief Executive Officer and Principal Financial and Accounting Officer have concluded that our disclosure controls and procedures are effective as of the end of the period covered by this report. The term "disclosure controls and procedures" means controls and other procedures of the Company that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within required time periods. We have established disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Principal Financial and Accounting Officer, as appropriate, to allow timely decisions regarding required disclosure.

There were no changes in our internal controls over financial reporting that occurred during the three months ended ~~March 31,~~June 30, 2022 that have materially affected, or are reasonably likely to affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1 — Legal Proceedings

We are involved in various legal proceedings, claims and litigation arising in the ordinary course of business. However, based on the facts currently available, we do not believe that the disposition of matters that are pending or asserted will have a material effect on our financial position, results of operations or cash flows.

Item 1A — Risk Factors

There have been no material changes to the risk factors previously described in our 2021 10-K.

Item 2 — Unregistered Sales of Securities and Use of Proceeds

On December 9, 2021, the Board of Directors approved a two-year stock repurchase program under which the Company may repurchase up to $350.0 million of its common stock. On July 27, 2022, the Company's Board of Directors approved a new stock repurchase program under which the Company may repurchase up to $400.0 million of its common stock over the next two years. Under terms of the program, purchases can be made in the open market or under a Rule 10b5-1 trading plan. The stock repurchase program does not obligate the Company to acquire any particular amount of the Company's stock and may be suspended at any time at the Company's discretion. The new program replaces the Company's previous $350.0 million stock repurchase program.

The Company's repurchases of its common stock during the three months ended ~~March 31,~~June 30, 2022 are shown in the table below.

Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number
(or Approximate Dollar Value) of Shares That May Yet be Purchased Under the Plans or Programs
(in millions)
January 169,497 $ 117.94 169,497 $ 315.1
February 194,693 $ 110.72 194,693 $ 293.5
March 325,153 $ 110.19 325,153 $ 257.7
Total 689,343 $ 112.24 689,343 $ 257.7


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares That May Yet be Purchased Under the Plans or Programs (in millions)
April	234,187	$	115.39	234,187	$	230.6
May	199,464	$	108.30	199,464	$	209.0
June	501,936	$	87.96	501,936	$	164.9
Total	935,587	$	99.16	935,587	$	164.9

In connection with our stock-based compensation plans, during the three months ended ~~March 31,~~June 30, 2022, ~~74,084~~21,892 shares of our common stock with an aggregate value of ~~$8.8~~$2.5 million were tendered by employees for payment of applicable statutory tax withholding. These shares are excluded from the table above.

Item 3 — Defaults Upon Senior Securities

None.

Item 4 — Mine Safety Disclosures

None.

Item 5 — Other Information

None.

1618

Item 6 — Exhibits

INDEX TO EXHIBITS


Number		Description
3.1		Amended and Restated Certificate of Incorporation of On Assignment, Inc., effective June 23, 2014 (incorporated by reference from Exhibit 3.1 to our Current Report on Form 8-K filed with the SEC on June 25, 2014)
3.2		Certificate of Amendment of Amended and Restated Certificate of Incorporation of On Assignment, Inc. effective April 2, 2018 (incorporated by reference from Exhibit 3.1 to our Current Report on Form 8-K filed with the SEC on March 16, 2018)
3.3		Fourth Amended and Restated Bylaws of ASGN Incorporated, effective March 18, 2021 (incorporated by reference from Exhibit 3.3 to our Quarterly Report on Form 10-Q filed with the SEC on August 9, 2021)
4.1		Specimen Common Stock Certificate (P)
31.1*		Certification of Theodore S. Hanson Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a)
31.2*		Certification of Edward L. Pierce, Executive Vice President and Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a)
32.1*		Certification of Theodore S. Hanson, Chief Executive Officer pursuant to 18 U.S.C. Section 1350
32.2*		Certification of Edward L. Pierce, Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350
101		The following material from this Quarterly Report on Form 10-Q of ASGN Incorporated, Part I, Item 1 of this Form 10-Q formatted in Inline XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Statements of Operations and Comprehensive Income; (iii) Condensed Consolidated Statement of Stockholders’ Equity; (iv) Condensed Consolidated Statements of Cash Flows; and (v) related notes to these financial statements.
104		Cover page interactive data file (formatted in Inline XBRL and contained in Exhibit 101)

*	Filed herewith.
(P)	This exhibit originally filed in paper format. Accordingly, a hyperlink has not been provided.

1719

SIGNATURE

Pursuant to the requirements of the Exchange Act, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	ASGN Incorporated

Date: ~~May 9,~~August 8, 2022	By:	/s/ Edward L. Pierce
		Edward L. Pierce
		Executive Vice President and Chief Financial Officer
		(Principal Financial and Accounting Officer and Duly Authorized Officer)

1820


		March 31, 2022						December 31, 2021
	Estimated Useful Life in Years	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Customer and contractual relationships	7 - 13	$	493.8	$	272.0	$	221.8	$	493.9	$	260.2	$	233.7
Contractor relationships	4	45.4		45.4		—		45.5		45.5		—
Contract Backlog	1 - 3	34.7		31.9		2.8		34.8		31.0		3.8
Non-compete agreements	1 - 7	29.4		22.6		6.8		29.4		21.6		7.8

		603.3		371.9		231.4		603.6		358.3		245.3
Not subject to amortization:
Trademarks		242.6		—		242.6		242.6		—		242.6
Total		$	845.9	$	371.9	$	474.0	$	846.2	$	358.3	$	487.9


Remainder of 2022	$	40.5
2023	44.5
2024	35.2
2025	28.7
2026	25.1
Thereafter	57.4
	$	231.4