Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 13, 2024 | Jun. 25, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 001-36704 | ||
Entity Registrant Name | BGSF, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 26-0656684 | ||
Entity Address, Address Line One | 5850 Granite Parkway, Suite 730 | ||
Entity Address, City or Town | Plano, | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 75024 | ||
City Area Code | 972 | ||
Local Phone Number | 692-2400 | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | BGSF | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 98,630,996 | ||
Entity Common Stock, Shares Outstanding | 10,928,763 | ||
Entity Central Index Key | 0001474903 | ||
Current Fiscal Year End Date | --01-01 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2022 | ||
Document Financial Statement Error Correction [Flag] | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Name | Whitley Penn LLP |
Auditor Location | Plano, Texas |
Auditor Firm ID | 726 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS | NATURE OF OPERATIONS BGSF, Inc., provides consulting, managed services, and professional workforce solutions to a variety of industries through its various divisions in information technology (“IT”), Finance & Accounting, Managed Solutions, and Property Management (formally known as Real Estate which includes apartment communities and commercial buildings) (collectively, with its consolidated subsidiaries, the “Company”). On March 21, 2022, the Company completed the sale of substantially all its Light Industrial segment (“InStaff”) assets to Jobandtalent (“J&T”), through the wholly-owned subsidiary, Sentech Engineering Services, Inc. Instaff’s financial results for reported periods 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” in the Consolidated Financial Statements included elsewhere in this report for additional information. On December 12, 2022, the Company acquired substantially all of the assets, and assumed certain of the liabilities of Horn Solutions, Inc. and Horn Solutions Dallas, LLC (collectively “Horn Solutions”). See “Note 3- Acquisitions.” On April 24, 2023, the Company acquired substantially all of the assets and assumed certain of the liabilities of Arroyo Consulting, LLC (“Arroyo Consulting”), which is a nearshore and offshore workforce solutions company that specializes in IT and software development with operations in the United States, Colombia, and India. See “Note 3- Acquisitions.” The Company operates primarily within the United States of America (“U.S.”) through the Property Management and Professional segments. The Property Management segment provides office and maintenance talent in 38 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. |
CONTINGENCIES
CONTINGENCIES | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES The Company is engaged from time to time in legal matters and proceedings arising out of its normal course of business. The Company establishes a liability related to its legal proceedings and claims when it has determined that it is probable that the Company has incurred a liability and the related amount can be reasonably estimated. If the Company determines that an obligation is reasonably possible, the Company will, if material, disclose the nature of the loss contingency and the estimated range of possible loss, or include a statement that no estimate of the loss can be made. The Company insures against, subject to and upon the terms and conditions of various insurance policies, claims or losses from workers’ compensation, general liability, automobile liability, property damage, professional liability, employment practices, fiduciary liability, fidelity losses, crime and cyber risk, and director and officer liability. Under the Company’s bylaws, the Company’s directors and officers are indemnified against certain liabilities arising out of the performance of their duties to the Company. The Company also has an insurance policy for our directors and officers to insure them against liabilities arising from the performance of their positions with the Company or its subsidiaries. The Company has also entered into indemnification agreements with its directors and certain officers. Employment Agreements The CEO’s employment agreement was effective as of October 1, 2018 and the agreement remains in effect under successive one-year extensions unless terminated pursuant to its terms. In the event that her employment is terminated by the Company without cause or by her for good reason, she will be entitled to (i) twelve months of base salary, (ii) accrued bonus, and (iii) eighteen months of COBRA premiums for her and her dependents, grossed-up for federal income taxes. Additionally, she will become 100% vested in any awards outstanding under the Company’s 2013 Long-Term Incentive Plan, as amended, (“2013 Plan”) or similar plan. Should there be a sale of the Company that results in the termination of her employment or a material adverse change in her duties and responsibilities, she will be entitled to all of the amounts listed above, however, base salary shall equal eighteen months. The CFO’s employment agreement was effective as of March 20, 2023 and remains in effect through December 31, 2025 with successive one-year extensions unless terminated pursuant to its terms. In the event that his employment is terminated by the Company without cause or by him for good reason, he will be entitled to (i) twelve months of base salary, (ii) accrued bonus, and (iii) eighteen months of COBRA premiums for him and his dependents, grossed-up for federal income taxes. Additionally, he will become 100% vested in any awards outstanding under the 2013 Plan or similar plan. Should there be a sale of the Company that results in the termination of his employment, he will be entitled to all of the amounts listed above, however, base salary shall equal eighteen months. |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 |
Current assets | |||
Accounts receivable (net of allowance for credit losses of $554 and $558, respectively) | $ 56,776,000 | $ 66,285,000 | $ 48,100,000 |
Prepaid expenses | 2,963,000 | 2,418,000 | |
Other current assets | 7,172,000 | 7,459,000 | |
Total current assets | 66,911,000 | 76,162,000 | |
Property and equipment, net | 1,217,000 | 2,081,000 | |
Other assets | |||
Deposits | 2,699,000 | 2,616,000 | |
Software as a service, net | 5,026,000 | 4,411,000 | |
Deferred income taxes, net | 7,271,000 | 2,196,000 | |
Right-of-use asset - operating leases | 5,435,000 | 4,462,000 | |
Intangible assets, net | 30,370,000 | 47,552,000 | |
Goodwill | 59,588,000 | 55,193,000 | 29,142,000 |
Total other assets | 110,389,000 | 116,430,000 | |
Total assets | 178,517,000 | 194,673,000 | |
Current liabilities | |||
Accounts payable | 95,000 | 587,000 | |
Accrued payroll and expenses | 14,902,000 | 19,171,000 | |
Borrowings under revolving credit facilities | 24,746,000 | 0 | |
Long-term debt, current portion | 34,000,000 | 4,000,000 | |
Accrued interest | 438,000 | 273,000 | |
Income taxes payable | 282,000 | 253,000 | |
Contingent consideration, current portion | 4,208,000 | 1,081,000 | |
Convertible note | 4,368,000 | 4,368,000 | |
Other current liabilities | 0 | 1,000,000 | |
Lease liabilities, current portion | 2,016,000 | 1,842,000 | |
Total current liabilities | 85,055,000 | 28,207,000 | |
Line of credit (net of debt issuance costs of $259) | 0 | 22,303,000 | |
Long-term debt, less current portion | 0 | 36,000,000 | |
Contingent consideration, less current portion | 4,112,000 | 0 | |
Lease liabilities, less current portion | 3,814,000 | 3,049,000 | |
Other long-term liabilities | 0 | 10,000 | |
Total liabilities | 92,981,000 | 93,937,000 | |
Commitments and contingencies | |||
Preferred stock, $0.01 par value per share, 500,000 shares authorized, -0- shares issued and outstanding | 0 | 0 | |
Common stock, $0.01 par value per share; 19,500,000 shares authorized, 10,887,509 and 10,772,515 shares issued and outstanding, respectively, net of treasury stock, at cost, of 3,930 and 1,845 shares, respectively | 52,000 | 70,000 | |
Additional paid in capital | 68,551,000 | 67,003,000 | |
Retained earnings | 16,933,000 | 33,663,000 | |
Total stockholders’ equity | 85,536,000 | 100,736,000 | $ 76,592,000 |
Total liabilities and stockholders’ equity | $ 178,517,000 | $ 194,673,000 |
CONSOLIDATED BALANCE SHEETS - P
CONSOLIDATED BALANCE SHEETS - Parenthetical - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 554,000 | $ 558,000 |
Long-term debt, current portion - Debt issuance costs | 0 | 0 |
Line of credit - Debt issuance costs | 128,000 | 259,000 |
Long-term debt, less current portion - Debt issuance costs | $ 0 | $ 0 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 19,500,000 | 19,500,000 |
Common stock, shares issued (in shares) | 10,888,000 | |
Common stock, shares outstanding (in shares) | 10,888,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Income Statement [Abstract] | |||
Revenues | $ 313,167,000 | $ 298,422,000 | $ 239,027,000 |
Cost of services | 201,383,000 | 194,874,000 | 158,086,000 |
Gross profit | 111,784,000 | 103,548,000 | 80,941,000 |
Selling, general and administrative expenses | 88,650,000 | 83,211,000 | 65,116,000 |
Gain on contingent consideration | 0 | 0 | (2,403,000) |
Impairment losses | 22,545,000 | 0 | 0 |
Depreciation and amortization | 7,774,000 | 4,054,000 | 3,698,000 |
Operating (loss) income | (7,185,000) | 16,283,000 | 14,530,000 |
Interest expense, net | (5,976,000) | (1,363,000) | (1,433,000) |
(Loss) income from continuing operations before income taxes | (13,161,000) | 14,920,000 | 13,097,000 |
Income tax benefit (expense) from continuing operations | 2,938,000 | (3,659,000) | (2,639,000) |
(Loss) income from continuing operations | (10,223,000) | 11,261,000 | 10,458,000 |
Income from discontinued operations: | |||
Income | 0 | 1,235,000 | 4,570,000 |
Gain on sale | 0 | 17,675,000 | 0 |
Income tax expense | 0 | (4,810,000) | (919,000) |
Net (loss) income | (10,223,000) | 25,361,000 | 14,109,000 |
Change in unrealized (losses) gains on cash flow hedges | 0 | (58,000) | 181,000 |
Other comprehensive (loss) gain | 0 | (58,000) | 181,000 |
Net comprehensive (loss) income | $ (10,223,000) | $ 25,303,000 | $ 14,290,000 |
Net (loss) income per share - basic: | |||
Net Income from continuing operations (in dollars per share) | $ (0.95) | $ 1.08 | $ 1.01 |
Net Income from discontinued operations: Income (in dollars per share) | 0 | 0.12 | 0.44 |
Net Income from discontinued operations: Gain on sale (in dollars per share) | 0 | 1.69 | 0 |
Net Income from discontinued operations: Income tax expense (in dollars per share) | 0 | (0.46) | (0.09) |
Net income per share - basic (in dollars per share) | (0.95) | 2.43 | 1.36 |
Net (loss) income per share - diluted: | |||
Net Income from continuing operations (in dollars per share) | (0.95) | 1.07 | 1 |
Net Income from discontinued operations: Income (in dollars per share) | 0 | 0.12 | 0.44 |
Net Income from discontinued operations: Gain on sale (in dollars per share) | 0 | 1.69 | 0 |
Net Income from discontinued operations: Income tax expense (in dollars per share) | 0 | (0.46) | |
Net income per share - diluted (in dollars per share) | $ (0.95) | $ 2.42 | $ 1.35 |
Weighted average shares outstanding: | |||
Basic (in shares) | 10,766,000 | 10,427,000 | 10,367,000 |
Diluted (in shares) | 10,766,000 | 10,473,000 | 10,417,000 |
Cash dividends declared per common share (in dollars per share) | $ 0.60 | $ 0.60 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Total | Discontinued operations Instaff | Preferred Stock | Common Stock | Treasury Stock Amount | Additional Paid in Capital | Additional Paid in Capital Discontinued operations Instaff | Retained Earnings | Accumulated Other Comprehensive (Loss)/Income |
Stockholders’ equity, beginning of period at Dec. 27, 2020 | $ 65,458,000 | $ 103,000 | $ (29,000) | $ 60,457,000 | $ 5,050,000 | $ (123,000) | |||
Stockholders’ equity (in shares), beginning of period at Dec. 27, 2020 | 10,328,000 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Share-based compensation | 1,058,000 | $ 54,000 | 1,058,000 | $ 54,000 | |||||
Exercise of common stock shares | (40,000) | (40,000) | |||||||
Issuance of restricted shares (shares) | (64,000) | ||||||||
Issuance of restricted shares | $ (9,000) | $ 1,000 | (9,000) | (1,000) | |||||
Issuance of ESPP shares (in shares) | 32,000 | ||||||||
Exercise of common stock shares (in shares) | 600 | 1,000 | |||||||
Exercise of common stock options | $ 8,000 | 8,000 | |||||||
Net (loss) income | 14,109,000 | 14,109,000 | |||||||
Other comprehensive gain (loss) | 181,000 | 181,000 | |||||||
Stockholders’ equity, end of period at Dec. 26, 2021 | 76,592,000 | $ 0 | $ 104,000 | (38,000) | 61,876,000 | 14,592,000 | 58,000 | ||
Stockholders’ equity (in shares), end of period at Dec. 26, 2021 | 10,425,000 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Payments of dividends | (4,567,000) | (4,567,000) | |||||||
Issuance of ESPP shares | 340,000 | 340,000 | |||||||
Share-based compensation | 1,085,000 | $ 7,000 | 1,085,000 | $ 7,000 | |||||
Transaction fees related sale of discontinued operations | 35,000 | ||||||||
Issuance of shares, net of offering costs | $ 3,000 | ||||||||
Exercise of common stock shares | 3,341,000 | 3,338,000 | |||||||
Issuance of restricted shares | $ 0 | (1,000) | |||||||
Issuance of restricted shares, net of shares of treasury stock (shares) | 32,344 | ||||||||
Issuance of restricted shares, net of shares of treasury stock | $ 1,000 | ||||||||
Issuance of ESPP shares (in shares) | 59,506 | ||||||||
Exercise of common stock options | 10,000 | ||||||||
Exercise of common stock options and warrants (shares) | 1,000 | ||||||||
Net (loss) income | $ 25,361,000 | 25,361,000 | |||||||
Other comprehensive gain (loss) | (58,000) | (58,000) | |||||||
Stockholders’ equity, end of period at Jan. 01, 2023 | 100,736,000 | 0 | $ 108,000 | (38,000) | 67,003,000 | 33,663,000 | 0 | ||
Stockholders’ equity (in shares), end of period at Jan. 01, 2023 | 10,772,000 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Payments of dividends | (6,290,000) | (6,290,000) | |||||||
Issuance of ESPP shares | 653,000 | 653,000 | |||||||
Share-based compensation | 1,029,000 | ||||||||
Issuance of restricted shares, net of shares of treasury stock (shares) | 56,889 | ||||||||
Issuance of restricted shares, net of shares of treasury stock | $ (41,000) | $ 1,000 | (19,000) | (23,000) | |||||
Issuance of ESPP shares (in shares) | 54,305 | ||||||||
Exercise of common stock options and warrants (shares) | 5,000 | ||||||||
Exercise of common stock options | $ 30,000 | 30,000 | |||||||
Net (loss) income | (10,223,000) | (10,223,000) | |||||||
Stockholders’ equity, end of period at Dec. 31, 2023 | 85,536,000 | $ 0 | $ 109,000 | $ (57,000) | 68,551,000 | 16,933,000 | $ 0 | ||
Stockholders’ equity (in shares), end of period at Dec. 31, 2023 | 10,888,000 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Payments of dividends | (6,507,000) | $ (6,507,000) | |||||||
Issuance of ESPP shares | $ 512,000 | $ 512,000 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - Parenthetical - shares | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 |
Statement of Stockholders' Equity [Abstract] | |||
Treasury stock, shares (in shares) | 610 | 231 | 176 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Cash flows from operating activities | |||
Net (loss) income | $ (10,223,000) | $ 25,361,000 | $ 14,109,000 |
(Income) from discontinued operations | 0 | (1,235,000) | (4,570,000) |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | |||
Depreciation | 446,000 | 597,000 | 685,000 |
Amortization | 7,328,000 | 3,457,000 | 3,013,000 |
Gain on sale of discontinued operations | 0 | (17,675,000) | 0 |
Impairment losses | 22,545,000 | 0 | 0 |
CARES Act credit | 0 | 0 | (2,368,000) |
Loss on disposal of property and equipment | 17,000 | 6,000 | 8,000 |
Contingent consideration adjustment | 0 | 0 | (2,403,000) |
Amortization of debt issuance costs | 199,000 | 172,000 | 75,000 |
Interest expense on contingent consideration payable | 740,000 | 128,000 | 252,000 |
Provision for credit losses | 798,000 | 315,000 | 221,000 |
Share-based compensation | 1,029,000 | 1,085,000 | 1,058,000 |
Deferred income taxes, net of acquired deferred tax liability | (5,075,000) | 2,353,000 | 1,279,000 |
Net changes in operating assets and liabilities, net of effects of acquisitions: | |||
Accounts receivable | 12,163,000 | (14,793,000) | (15,178,000) |
Prepaid expenses and other current assets | (2,159,000) | (866,000) | (200,000) |
Deposits | (83,000) | 1,503,000 | (126,000) |
Software as a service | 720,000 | 660,000 | 319,000 |
Accounts payable | (492,000) | (228,000) | 156,000 |
Accrued payroll and expenses | (7,426,000) | 1,633,000 | 5,730,000 |
Accrued interest | 165,000 | 171,000 | 24,000 |
Income taxes receivable and payable | 729,000 | (1,202,000) | (560,000) |
Other current liabilities | (1,000,000) | (4,551,000) | 19,000 |
Operating leases | (35,000) | (127,000) | (107,000) |
Other long-term liabilities | 0 | (64,000) | (78,000) |
Net cash provided by (used in) continuing operating activities | 20,386,000 | (3,300,000) | 1,358,000 |
Net cash (used in) provided by discontinued operating activities | 0 | (3,822,000) | 5,305,000 |
Net cash provided by (used in) operating activities | 20,386,000 | (7,122,000) | 6,663,000 |
Cash flows from investing activities | |||
Businesses acquired, net of cash acquired | (6,917,000) | (33,940,000) | (3,791,000) |
Business sold | 0 | 30,722,000 | 0 |
Capital expenditures | (2,597,000) | (5,680,000) | (3,204,000) |
Proceeds from sale of property and equipment | 0 | 0 | 5,000 |
Net cash used in continuing investing activities | (9,514,000) | (8,898,000) | (6,990,000) |
Net cash used in discontinued investing activities | 0 | (26,000) | (34,000) |
Net cash used in investing activities | (9,514,000) | (8,924,000) | (7,024,000) |
Cash flows from financing activities | |||
Net borrowings under line of credit | 2,312,000 | 9,781,000 | 6,804,000 |
Proceeds from issuance of long-term debt | 0 | 40,000,000 | 0 |
Principal payments on long-term debt | (6,000,000) | (26,863,000) | (2,063,000) |
Payments of dividends | (6,507,000) | (6,290,000) | (4,567,000) |
Issuance of ESPP shares | 512,000 | 653,000 | 340,000 |
Issuance of shares under the 2013 Long-Term Incentive Plan and Form S-3 registration statement costs, net of exercises | (10,000) | (1,000) | (41,000) |
Contingent consideration paid | (1,110,000) | (1,110,000) | 0 |
Debt issuance costs | (69,000) | (236,000) | 0 |
Net cash (used in) provided by financing activities | (10,872,000) | 15,934,000 | 473,000 |
Net change in cash and cash equivalents | 0 | (112,000) | 112,000 |
Cash and cash equivalents, beginning of year | 0 | 112,000 | 0 |
Cash and cash equivalents, end of year | 0 | 0 | 112,000 |
Supplemental cash flow information: | |||
Cash paid for interest, net | 4,668,000 | 641,000 | 879,000 |
Cash paid for taxes, net of refunds | $ 1,378,000 | $ 7,562,000 | $ 3,676,000 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The consolidated financial statements include the accounts of the Company. All significant intercompany transactions and balances have been eliminated in consolidation. Fiscal Year The Company has a 52/53 week fiscal year. Fiscal years for the consolidated financial statements included herein are for the 52 weeks ended December 31, 2023, and 53 weeks ended January 1, 2023, and the 52 weeks ended December 26, 2021, referred as Fiscal 2023, 2022, and 2021, respectively. Reclassifications Certain reclassifications have been made to the 2022 and 2021 financial statements to conform with the 2023 presentation. Management Estimates The preparation of consolidated financial statements in conformity with generally accepted accounting principles in United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates affecting the financial statements include allowances for credit losses, goodwill, intangible assets, lease liabilities, contingent consideration obligations related to acquisitions, and income taxes. Additionally, the valuation of share-based compensation expense uses a model based upon interest rates, stock prices, maturity estimates, volatility and other factors. The Company believes these estimates and assumptions are reliable. However, these estimates and assumptions may change in the future based on actual experience as well as market conditions. Financial Instruments The Company uses fair value measurements in areas that include, but are not limited to, the allocation of purchase price consideration to tangible and identifiable intangible assets, convertible debt, contingent consideration, and interest rate swap agreements. The carrying values of cash, accounts receivables, accounts payable, accrued payroll and expenses, and other current assets and liabilities approximate their fair values because of the short-term nature of these instruments. The carrying value of bank debt approximates fair value due to the variable nature of the interest rates under the credit agreement with BMO Harris Bank, N.A. (“BMO”) that provides for a revolving credit facility, term loan and current rates available to the Company for debt with similar terms and risk. In Fiscal 2022 and 2021, Management determined the fair value on the interest rate swap based on quoted prices from BMO. Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with an original maturity of three months or less. Concentration of Credit Risk Concentration of credit risk is limited due to the Company’s diverse client partner base and their dispersion across many different industries and geographic locations nationwide. No single client partner accounted for more than 10% of the Company’s accounts receivable as of December 31, 2023 and January 1, 2023 or revenue from continuing operations in Fiscal 2023, 2022 and 2021. Geographic revenue from continuing operations in excess of 10% of the Company’s consolidated revenue in Fiscal 2023 and the related percentage for Fiscal 2022 and 2021 was generated in the following areas at: December 31, January 1, December 26, Tennessee 13 % 10 % 12 % Texas 25 % 23 % 23 % Consequently, weakness in economic conditions in these regions could have a material adverse effect on the Company’s financial position and results of future operations. Accounts Receivable The Company extends credit to its client partners in the normal course of business. Accounts receivable represents unpaid balances due from client partners. The Company maintains an allowance for credit losses for expected losses resulting from client partners’ non-payment of balances due to the Company. The Company’s determination of the allowance for uncollectible amounts is based on management’s judgments and assumptions, including general economic conditions, portfolio composition, credit loss, evaluation of credit risk related to certain individual client partners and the Company’s ongoing examination process. Receivables are written off after they are deemed to be uncollectible after all reasonable means of collection have been exhausted. Recoveries of receivables previously written off are recorded when received. Changes in the allowance for credit losses from continuing operations are as follows at (in thousands): December 31, January 1, Beginning balance $ 558 $ 449 Acquired allowance for credit losses - Horn Solutions — 109 Provision for credit losses, net 798 315 Amounts written off, net (802) (315) Ending balance $ 554 $ 558 Property and Equipment The Company depreciates the cost of property and equipment over the estimated useful lives of the assets using the straight-line method ranging from five Deposits The Company maintains guaranteed costs policies for workers’ compensation coverage in monopolistic states and minimal loss retention coverage in all other states. Under these policies, the Company is required to maintain refundable deposits of $2.4 million, which are included in Deposits in the accompanying consolidated balance sheets, as of December 31, 2023 and January 1, 2023. Software as a service The Company capitalizes direct costs incurred in cloud computing implementation costs from hosting arrangements, and are reported as a component of Software as a service. All other internal-use software development costs are capitalized and reported as a component of computer software within Intangible assets. In Fiscal 2023, the Company added software assets of $0.6 million and reclassified $0.7 million from property and equipment related to the information technology improvement project. The Company reviews its long-lived assets, primarily fixed assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recovered. The Company looks primarily to the undiscounted future cash flows in its assessment of whether or not long-lived assets have been impaired. There were no impairments with respect to long-lived assets during Fiscal 2023, 2022 or 2021. Leases The Company leases all their office space through operating leases, which expire at various dates through 2030. Many of the lease agreements obligate the Company to pay real estate taxes, insurance and certain maintenance costs, which are accounted for separately. Certain of the Company’s lease arrangements contain renewal provisions from 1 to 10 years, exercisable at the Company’s option. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company determines if an arrangement is an operating lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. All other leases are recorded on the balance sheet as right-of-use assets and lease liabilities for the lease term. Right-of-use lease assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term and include options to extend or terminate the lease when they are reasonably certain to be exercised. The present value of lease payments is determined using the incremental borrowing rate based on the information available at lease commencement date, unless the implicit rate in the lease is readily determinable. The Company’s operating lease expense is recognized on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. Intangible Assets The Company holds intangible assets with finite lives. Intangible assets with finite useful lives are amortized over their respective estimated useful lives, ranging from three Identifiable Intangible assets recognized in conjunction with acquisitions are recorded at fair value. Significant unobservable inputs are used to determine the fair value of the identifiable Intangible assets based on the income approach valuation model whereby the present worth and anticipated future benefits of the identifiable Intangible assets are discounted back to their net present value. The Company capitalizes purchased software and internal payroll costs directly incurred in the modification of internal use software. Software maintenance and training costs are expensed in the period incurred. The Company evaluates the recoverability of Intangible assets whenever events or changes in circumstances indicate that an Intangible asset’s carrying amount may not be recoverable. The Company considered the current and expected future economic and market conditions and its impact on each of the reporting units. The Company annually evaluates the remaining useful lives of all Intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization. In the first quarter of Fiscal 2023, management decided to eliminate the use of various trade names and go to market under the BGSF brand. Management’s rebranding created an impairment charge of $22.5 million. The Company determined that there were no impairment indicators for these assets in Fiscal 2022. Goodwill Goodwill represents the difference between the total consideration paid less the fair value of all recognized net asset fair values including identifiable intangible asset values in a business combination. The Company reviews goodwill for impairment annually during the fourth quarter or whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Based on annual testing, the Company has determined that there was no goodwill impairment in Fiscal 2023, 2022 or 2021. The Company first evaluates qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of the reporting unit is less than its carrying amount, including goodwill. If after qualitatively assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then further testing is unnecessary. If after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company then estimates the fair value of the reporting unit and compares the fair value of the reporting unit with its carrying amount, including goodwill, as discussed below. In assessing whether it is more likely than not that an indefinite-lived intangible asset is impaired, the Company assesses relevant events and circumstances that could affect the significant inputs used to determine the fair value. The quantitative impairment test for an indefinite-lived intangible asset consists of a comparison of the fair value of the asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, a reporting unit shall recognize an impairment loss in an amount equal to that excess. The quantitative goodwill impairment test involves a two-step process. In the first step, the Company compares the fair value of each reporting unit to its carrying value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and no further testing is required. If the fair value of the reporting unit is less than the carrying value, the Company must perform the second step of the impairment test to measure the amount of impairment loss. In the second step, the reporting unit’s fair value is allocated to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill in the same manner as if the reporting unit was being acquired in a business combination. If the implied fair value of the reporting unit's goodwill is less than the carrying value, the difference is recorded as an impairment loss. Cash Flow Hedge The unrealized gains or losses associated with the change in the fair value of the effective portion of the hedging instrument was recorded in accumulated other comprehensive income or loss. The Company reclassified the interest rate swap from accumulated other comprehensive gain or loss against interest expense in the same period in which the hedge transaction affected earnings. There were no outstanding cash flow hedges at December 31, 2023 or January 1, 2023. Debt Issuance Costs Debt issuance costs are amortized using the effective interest method over the term of the respective loans. Debt issuance costs related to a recognized debt liability are presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability. Contingent Consideration The Company has obligations, to be paid in cash, related to its acquisitions if certain operating and financial goals are met. The fair value of this contingent consideration is determined using expected cash flows and present value technique. The fair value calculation of the expected future payments uses a discount rate commensurate with the risks of the expected cash flow. The resulting discount is amortized as interest expense over the outstanding period using the effective interest method. Revenue Recognition The Company derives its revenues from continuing operations in Property Management and Professional segments by providing workforce solutions, placement services, and managed services. Revenues are recognized when promised services are delivered to client partners, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenues from continuing operations as presented on the consolidated statements of operations and comprehensive (loss) income represent services rendered to client partners less sales adjustments and allowances. Reimbursements, including those related to out-of-pocket expenses, are also included in revenues, and the related amounts of reimbursable expenses are included in cost of services. The Company records revenue on a gross basis as a principal versus on a net basis as an agent in the presentation of revenues and expenses. The Company has concluded that gross reporting is appropriate because the Company (i) has the risk of identifying and hiring qualified field talent, (ii) has the discretion to select the field talent and establish their price and duties and (iii) bears the risk for services that are not fully paid for by client partners. Workforce solution revenues - Field talent revenues from contracts with client partners are recognized in the amount to which the Company has a right to invoice, when the services are rendered by the Company’s field talent. Contingent placement revenues - Any revenues associated with workforce solutions that are provided on a contingent basis are recognized once the contingency is resolved, as this is when control is transferred to the client partner, usually when employment candidates start their employment. Retained search placement revenues - Any revenues from these workforce solutions are recognized based on the contractual amount for services completed to date which best depicts the transfer of control of services, which is less than 1% of consolidated revenues. Managed services revenues - include both workforce solution revenues and fixed fee revenues from client partner contracts. Services performed represent the transfer of control to the client partner over a given period of time. Fixed fee revenues are recognized in equal amounts at fixed intervals as promised services are delivered. The Company estimates the effect of placement candidates who do not remain with its client partners through the guarantee period (generally 90 days) based on historical experience. Allowances, recorded as a liability, are established to estimate these losses. Fees to client partners are generally calculated as a percentage of the new worker’s annual compensation. No fees for placement workforce solutions are charged to employment candidates. These assumptions determine the timing of revenue recognition for the reported period. Refer to Note 19 for disaggregated revenues by segment. Payment terms in the Company’s contracts vary by the type and location of its client partner and the workforce solutions offered. The term between invoicing and when payment is due is not significant. There were no unsatisfied performance obligations as of December 31, 2023 or January 1, 2023. There were no revenues recognized during Fiscal 2023 related to performance obligations satisfied or partially satisfied in previous periods. There are no contract costs capitalized. The Company did not recognize any contract impairments during Fiscal 2023, 2022, and 2021. The opening balance of accounts receivable at December 26, 2021, was $48.1 million. Advertising The Company recognizes advertising expense in selling, general and administrative expenses as the services are incurred. Total advertising expense from continuing operations for Fiscal 2023, 2022, and 2021 was $2.1 million, $2.0 million, and $2.0 million, respectively. Share-Based Compensation The Company recognizes compensation expense in selling, general and administrative expenses over the service period for options or restricted stock that are expected to vest and records adjustments to compensation expense at the end of the service period if actual forfeitures differ from original estimates. Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by dividing income available to common stockholders by the weighted average number of common shares outstanding during the period adjusted to reflect potentially dilutive securities. Antidilutive shares are excluded from the calculation of earnings per share. The following is a reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the respective periods (in thousands): December 31, January 1, December 26, Weighted-average number of common shares outstanding: 10,766 10,427 10,367 Effect of dilutive securities: Stock options and restricted stock — 46 50 Weighted-average number of diluted common shares outstanding 10,766 10,473 10,417 Stock options and restricted stock 812 360 402 Convertible note 255 255 — Antidilutive shares 1,067 615 402 Income Taxes The current provision for income taxes represents estimated amounts payable or refundable on tax returns filed or to be filed for the year. The Company recognizes any penalties when necessary as part of selling, general and administrative expenses. As a matter of operation, we first calculated the effective tax on continuing operations, and then allocated the remaining taxes to our discontinued operations, in accordance with Accounting Standards Codification (“ASC”) Topic 740. As of December 31, 2023 and January 1, 2023, goodwill of $45.9 million and $50.4 million, respectively, which is limited annually and is expected to be deductible for tax purposes. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts are classified as noncurrent in the consolidated balance sheets. Deferred tax assets are also recognized for net operating loss and tax credit carryovers. The overall change in deferred tax assets and liabilities for the period measures the deferred tax expense or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustments to tax expense in the period of enactment. As of December 31, 2023, the Company has a $2.6 million net operating loss carry forward from the 2020 EdgeRock acquisition with no expiration date. These net operating losses are subject to an annual Internal Revenue Code Section 382 limitation of $1.3 million. Additionally, there was an increase of $5.2 million to the deferred tax assets related to the $22.5 million in impairment losses as of December 31, 2023. When appropriate, the Company will record a valuation allowance against net deferred tax assets to offset future tax benefits that may not be realized. In determining whether a valuation allowance is appropriate, the Company considers whether it is more likely than not that all or some portion of our deferred tax assets will not be realized, based in part upon management’s judgments regarding future events and past operating results. The Company believes that it is more likely than not that all deferred tax assets will be realized and thus, believes that a valuation allowance is not required as of December 31, 2023 or January 1, 2023. The Company follows the guidance of ASC Topic 740, Accounting for Uncertainty in Income Taxes. ASC Topic 740 prescribes a more-likely-than-not measurement methodology to reflect the financial statement impact of uncertain tax positions taken or expected to be taken in a tax return. Recent Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures. The new standard provides guidance to improve reportable segment disclosure with enhanced reporting of significant segment expenses. The new guidance is effective after December 15, 2023, and interim periods beginning after December 15, 2024, early adoption is permitted. The Company is evaluating the impact of the new guidance on its consolidated financial statements and related disclosures. In December 2023, FASB issued ASU 2023-09, Income Taxes: Improvements to Income Tax Disclosures. The new standard requires annual disclosure of the specific categories in the rate reconciliation, and additional information for reconciling items that meet a quantitative threshold. Additional information may be required on reconciling items. The new guidance is effective after December 15, 2024, early adoption is permitted. The Company is evaluating the impact of the new guidance on its consolidated financial statements and related disclosures. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2023 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS Horn Solutions On December 12, 2022, the Company acquired substantially all of the assets, and assumed certain of the liabilities, of Horn Solutions. The purchase price of $42.7 million was paid at closing with $33.9 million in cash and $3.4 million of the Company common stock (254,455 shares of the Company common stock privately placed under Section 4(a)(2) of the Securities Act of 1933, as amended), as well as a two-year convertible promissory note of $4.4 million with an annual interest rate of 6%, with interest paid quarterly. The promissory note is convertible into shares of the Company common stock at any time after the one-year anniversary of the promissory note at a conversion price equal to $17.12 per share. The promissory note is subordinate to the Company’s senior debt. An additional portion of the purchase price, $1.0 million in cash, was held back as partial security for a post-closing purchase price adjustment. The asset purchase agreement contained a provision for a “true up” of acquired working capital within 120 days after the closing date. In May 2023, the hold back and true-up were paid, adjusting businesses acquired by $0.1 million in goodwill. The purchase price at closing was paid out of funds under the Company’s credit agreement led by BMO, see “Note 12 - Debt”. The acquired business was assigned to the Professional segment. The acquisition of Horn Solutions allowed the Company to strengthen and expand its finance and accounting operations by providing consulting, project loan staff, interim staff, direct hire, and managed services through three complementary business units: strategic accounting and finance, information technology, and transactional accounting and office staffing. Horn Solutions provides services to clients in a variety of industries including, but not limited to energy, financial services, healthcare, real estate and construction, service, manufacturing, and software industries. Shortly after closing, Horn Solutions was fully integrated into the Company's organizational structure and does not operate as a discrete entity. Consequently, the amount of revenue and earnings of Horn Solutions included in the Consolidated Statement of Comprehensive (Loss) Income since the acquisition date is impracticable to provide. The purchase price has been allocated to the assets acquired and liabilities assumed as of the date of acquisition as follows (in thousands): Accounts receivable $ 3,734 Prepaid expenses and other assets 118 Property and equipment, net 83 Right-of-use asset - operating leases 1,528 Intangible assets 13,484 Goodwill (deductible tax basis of $26.1 million) 26,610 Current liabilities assumed (1,787) Lease liability - operating leases (1,528) Total net assets acquired $ 42,242 Cash $ 33,940 Hold back 1,000 Convertible Note 4,368 Common stock 3,351 Working capital adjustment (417) Total fair value of consideration transferred for acquired business $ 42,242 The allocation of the intangible assets is as follows (in thousands): Estimated Fair Estimated Covenants not to compete $ 50 5 years Client partner list 13,434 10 years Total $ 13,484 The Company incurred costs of $0.4 million in Fiscal 2023 and Fiscal 2022 related to the Horn Solutions acquisition. These costs were expensed as incurred in selling, general and administrative expenses. Arroyo Consulting On April 24, 2023, the Company acquired substantially all of the assets, and assumed certain of the liabilities, of Arroyo Consulting for cash consideration of $6.8 million. Certain post-closing liabilities were held back of $0.4 million and a partial security for any indemnification obligation was held back for one year of $0.9 million. The purchase agreement further provides for contingent consideration of up to $8.5 million based on the performance of the acquired business for the two years following the date of acquisition. The purchase price at closing was paid out of funds under the Company’s credit agreement led by BMO, see “Note 12 - Debt”. The purchase agreement contained a provision for a “true up” of acquired working capital within 120 days after the closing date, which has not yet been finalized with the seller. The acquired business was assigned to the Professional segment. The acquisition of Arroyo Consulting allows the Company to strengthen the go-to-market cross-selling efforts providing clients a cost effective alternative offering nearshore and offshore IT resources. Arroyo Consulting provides nearshore and offshore professional workforce solutions specializing in IT and software development with operations in the United States, Colombia, and India. The 2022 and 2021 consolidated statements of operations do not include any operating results of Arroyo Consulting. The Fiscal 2023 consolidated statement of operation and comprehensive (loss) income included thirty-six weeks for approximately $14.8 million of revenue and $4.0 million of operating income, which included $0.7 million in amortization expense on acquisition intangibles. The preliminary purchase price has been allocated to the assets acquired and liabilities assumed as of the date of acquisition as follows (in thousands): Accounts receivable $ 3,452 Right-of-use asset - operating leases 141 Intangible assets 11,468 Goodwill (no deductible tax basis) 3,836 Current liabilities assumed (2,471) Lease liability - operating leases (140) Total net assets acquired $ 16,286 Cash $ 6,800 Hold back, working capital* 350 Hold back, indemnities* 850 Working capital adjustment* 677 Fair value of contingent consideration 7,609 Total fair value of consideration transferred for acquired business $ 16,286 *Included in Other current liabilities The allocation of the intangible assets is as follows (in thousands): Estimated Fair Estimated Covenants not to compete $ 352 5 years Client partner list 10,946 10 years Computer software 170 3 years Total $ 11,468 The Company incurred costs of $0.6 million in Fiscal 2023 related to the Arroyo Consulting acquisition. These costs were expensed as incurred in selling, general and administrative expenses. Supplemental Unaudited Pro Forma Information The Company estimates what would have been reported if the revenues and net income from continuing operations of the Horn Solutions and Arroyo Consulting acquisitions had taken place on the first day of the Company’s Fiscal 2022 (in thousands, except income per share): December 31, January 1, Revenues $ 320 $ 346 Gross profit $ 114 $ 123 Net (loss) income from continuing operations $ (10) $ 13 Net (loss) income per share from continuing operations: Basic $ (0.89) $ 1.29 Diluted $ (0.89) $ 1.29 Pro forma net (loss) income includes amortization of primarily client partner lists, interest expense on additional borrowings on the New Term Loan and the revolving facility (the “Revolving Facility”)(see “Note 12 - Debt”) at a rate of 2.5%. The tax benefit of the pro forma adjustments at an effective tax rate of 22.3% for Fiscal 2023 and 24.5% for Fiscal 2022. The pro forma operating results include adjustments to Horn Solutions and Arroyo Consulting related to synergy adjustments for expenses that would be duplicative and other non-recurring, non-operating and out of period expense items once integrated with the Company. There were no material nonrecurring adjustments. Amounts set forth above are not necessarily indicative of the results that would have been attained had the Horn Solutions and Arroyo Consulting acquisitions taken place on the first day of Fiscal 2022 or of the results that may be achieved by the combined enterprise in the future. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On March 21, 2022, the Company sold substantially all of the assets and certain liabilities of InStaff to Sentech Engineering Services, Inc. (“Sentech”) for a sale price of approximately $30.3 million cash, subject to customary sales price and working capital adjustments specified in the purchase agreement. The purchase agreement provided for deferred consideration of $2.0 million, which was received April 3, 2023. The sale resulted in an original pre-tax gain on sale of discontinued operations of $17.3 million, with an additional pre-tax gain of $0.4 million recognized as part of the net working capital adjustment in October 2022. 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. The financial results of InStaff are as follows at (in thousands): January 1, December 26, 2021 Revenue $ 16,465 $ 71,292 Cost of services 14,144 60,948 Gross profit 2,321 10,344 Selling expenses 1,062 5,684 Depreciation 24 90 Income from discontinued operations before gain on sale and income taxes $ 1,235 $ 4,570 |
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
Other current assets [Abstract] | |
Other Current Assets | OTHER CURRENT ASSETS Other current assets consist of the following at (in thousands): December 31, January 1, CARES Act receivable $ 2,188 $ 2,368 Deferred consideration — 2,000 Income tax receivable 685 1,667 Horn Solutions working capital adjustment — 534 Workers’ compensation deposit refund receivable — 448 Due from Arroyo and Sentech, respectively 3,843 411 Other 456 31 $ 7,172 $ 7,459 CARES Act Receivable |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following at (in thousands): December 31, January 1, Leasehold improvements $ 665 $ 1,397 Furniture and fixtures 1,152 1,506 Computer systems 3,476 4,077 5,293 6,980 Accumulated depreciation (4,076) (4,899) Property and equipment, net $ 1,217 $ 2,081 Total depreciation expense from continuing operations in Fiscal 2023, 2022 and 2021 was $0.4 million, $0.6 million, and $0.7 million, respectively. In Fiscal 2023, the Company completed software assets and reclassed $0.7 million to Software as a service and $0.2 million to Intangible assets related to the information technology improvement project. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
Leases, Operating [Abstract] | |
LEASES | LEASES The Company’s future continuing operating lease obligations that have not yet commenced are immaterial. Short-term leases were immaterial. The supplemental balance sheet and cash flow information related to the Company's operating leases were as follows at (dollars in thousands): December 31, January 1, December 26, 2021 Weighted average remaining lease term of operation leases 3.5 years 3.3 years 2.7 years Weighted average discount rate for continuing operating leases 6.5 % 5.2 % 5.0 % Cash paid for continuing operating leases $ 2,185 $ 2,115 $ 2,136 Continuing operating lease expense $ 2,155 $ 1,887 $ 1,907 Right-of -use assets obtained in exchange for new operating lease liabilities $ 2,837 $ 2,248 $ 6 The undiscounted annual future minimum lease payments of continuing operations consist of the following at (in thousands): December 31, 2023 2024 $ 2,306 2025 1,591 2026 1,211 2027 852 2028 512 Thereafter 74 Total lease payment 6,546 Interest (716) Present value of lease liabilities $ 5,830 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS In the first quarter of Fiscal 2023, management decided to eliminate the use of various trade names and go to market under the BGSF brand. Management’s rebranding created an impairment charge of $22.5 million. The Company determined that there were no impairment indicators for these assets in Fiscal 2022. Finite and indefinite lived intangible assets consist of the following at (in thousands): December 31, 2023 Gross Value Accumulated Net Finite lives: Client partner lists $ 69,114 $ 44,150 $ 24,964 Covenants not to compete 2,743 2,153 590 Computer software 7,825 3,009 4,816 Total $ 79,682 $ 49,312 $ 30,370 January 1, 2023 Gross Value Accumulated Net Finite lives: Client partner lists $ 58,609 $ 38,227 $ 20,382 Covenants not to compete 2,391 1,886 505 Computer software 7,208 3,087 4,121 68,208 43,200 25,008 Indefinite lives: Trade names 23,977 1,433 22,544 Total $ 92,185 $ 44,633 $ 47,552 Estimated future amortization expense for the next five years and thereafter is as follows (in thousands): Fiscal Years Ending: 2024 $ 7,185 2025 5,593 2026 4,332 2027 3,125 2028 2,469 Thereafter 7,666 Total $ 30,370 |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | GOODWILL The changes in the carrying amount of goodwill as of and during the years ended were as follows at (in thousands): Property Management Professional Total December 26, 2021 $ 1,074 $ 28,068 $ 29,142 Additions from acquisitions — 26,051 26,051 January 1, 2023 1,074 54,119 55,193 Additions from acquisitions — 4,395 4,395 December 31, 2023 $ 1,074 $ 58,514 $ 59,588 |
ACCRUED PAYROLL AND EXPENSES AN
ACCRUED PAYROLL AND EXPENSES AND CONTINGENT CONSIDERATION | 12 Months Ended |
Dec. 31, 2023 | |
Accrued Liabilities, Current [Abstract] | |
ACCRUED PAYROLL AND EXPENSES AND CONTINGENT CONSIDERATION | ACCRUED PAYROLL AND EXPENSES AND CONTINGENT CONSIDERATION Accrued payroll and expenses consist of the following at (in thousands): December 31, January 1, Field talent payroll $ 5,014 $ 6,923 Field talent payroll related 1,039 941 Accrued bonuses and commissions 2,931 5,740 Other 5,918 5,567 Accrued payroll and expenses $ 14,902 $ 19,171 The following is a schedule of future estimated contingent consideration payments at (in thousands): December 31, 2023 Estimated Cash Payment Discount Net Due in: Less than one year $ 4,250 $ (42) $ 4,208 One to two years 4,250 (138) 4,112 Contingent consideration $ 8,500 $ (180) $ 8,320 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES At December 31, 2023, federal income tax receivable of $0.7 million is included in Other current assets and state income tax payable of $0.3 million is included in Income taxes payable. At January 1, 2023, federal income tax receivable of $1.7 million is included in Other current assets and state income tax payable of $0.3 million is included in Income taxes payable. The Company’s income tax expense for the fiscal years are comprised of the following at (in thousands): December 31, 2023 January 1, December 26, 2021 Current federal income tax $ (1,312) $ (589) $ (594) Current state income tax (825) (717) (766) Deferred tax benefit (income) 5,075 (2,353) (1,279) Income tax benefit (expense) from continuing operations 2,938 (3,659) (2,639) Income tax (expense) from discontinued operations — (4,810) (919) Income tax benefit (expense) $ 2,938 $ (8,469) $ (3,558) Significant components of the Company’s deferred income taxes are as follows at (in thousands): December 31, January 1, Deferred tax assets: Allowance for credit losses $ 120 $ 127 Goodwill and intangible assets 5,242 787 Accrued payroll and expenses 681 404 Contingent consideration 2,087 271 Share-based compensation 602 504 Net operating loss carry forward 662 985 Deferred tax liabilities: Prepaid expenses and other current assets (735) (579) Property and equipment (1,388) (303) Deferred income taxes, net $ 7,271 $ 2,196 The income tax provision, reconciled to the tax computed at the statutory federal rate, is as follows at (in thousands): December 31, 2023 January 1, 2023 December 26, 2021 Tax benefit (expense) at federal statutory rate $ 2,764 (21.0) % $ (3,133) (21.0) % $ (2,750) (21.0) % State income tax benefit (expense), net of federal benefit 194 (1.5) % (795) (5.3) % (1,100) (8.4) % Equity, permanent differences and other (319) 2.3 % (178) (1.2) % 503 3.7 % Work Opportunity Tax Credit, net 299 (2.3) % 447 3.0 % 708 5.4 % Income tax benefit (expense) from continuing operations 2,938 (22.5) % (3,659) (24.5) % (2,639) (20.3) % Income tax (expense) from discontinued operations — — % (4,810) (24.5) % (919) (20.3) % Income tax benefit (expense) $ 2,938 (22.5) % $ (8,469) (24.5) % $ (3,558) (20.3) % |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT On July 16, 2019, the Company entered into a Credit Agreement (the “Credit Agreement”), maturing July 16, 2024, led by BMO, as lead administrative agent, lender, letters of credit issuer, and swing line lender. The Credit Agreement provided for the Revolving Facility permitting the Company to borrow funds from time to time in an aggregate amount up to $35 million. The Credit Agreement also provided for a term loan commitment (the “Term Loan”) permitting the Company to borrow funds from time to time in an aggregate amount not to exceed $30 million with principal payable quarterly, based on an annual percentage of the original principal amount as defined in the Credit Agreement, all of which has been funded and repaid. The Company also had the option to request an increase in in the aggregate Term Loan by $40 million, which was done in connection with the Horn Solutions acquisition. The Company’s obligations under the Credit Amendment are secured by a first priority security interest in substantially all tangible and intangible property of the Company and its subsidiaries. The Credit Agreement bore interest either at the Base Rate plus the Applicable Margin or LIBOR plus the Applicable Margin through August 17, 2022 (as such terms are defined in the Credit Agreement). The Company pays an unused commitment fee on the daily average unused amount of the Revolving Facility. On August 18, 2022, the Company entered into an amendment to the Credit Agreement with BMO, which changed the interest rate component from LIBOR to the Secured Overnight Financing Rate (“SOFR”), plus the Applicable Margin (as such terms are defined in the amended credit agreement). In connection with the Horn Solutions acquisition on December 12, 2022 (See “Note 3 - Acquisitions”), the Company exercised the option to borrow $40.0 million, as noted above, pursuant to a second amendment to the Credit Agreement (“Second Credit Amendment”). The Second Credit Amendment requires 2.5% of the original principal balance of the New Term Loan payable on the last business day of each quarter, beginning on March 31, 2023. On April 24, 2023, in connection with the acquisition of Arroyo Consulting, the Company entered into a Third Amendment to the Credit Agreement (“Third Credit Amendment”) with BMO. The Third Credit Amendment revised language to permit an acquisition of a foreign entity under certain circumstances and modified the terms of permitted distributions and guarantors. On May 19, 2023, the Company entered into a Fourth Amendment to the Credit Agreement (“Fourth Credit Amendment”) increasing the Revolving Facility by $6.0 million to an aggregate amount up to $41.0 million. The Company is subject to a maximum Leverage Ratio and a minimum Fixed Charge Coverage Ratio (as such terms are defined in the amended Second Credit Amendment). The Company was in compliance with the customary affirmative and negative covenants as of December 31, 2023. The indebtedness under the Credit Agreement had a maturity date of July 16, 2024, which has been classified within current liabilities as of December 31, 2023. The Credit Agreement was amended and restated on March 12, 2024. See Note 21 - Subsequent Events. Letter of Credit In March 2020, in conjunction with the 2020 EdgeRock acquisition, the Company entered into a standby letter of credit arrangement, which expires December 31, 2024, for purposes of protecting a lessor against default on lease payments. As of December 31, 2023, the Company had a maximum financial exposure from this standby letter of credit totaling $0.1 million, all of which is considered usage against the Revolving Facility. The Company has no history of default, nor is it aware of circumstances that would require it to perform under, any of these arrangements and believes that the resolution of any disputes thereunder that might arise in the future would not materially affect the Company’s consolidated financial statements. Accordingly, no liability has been recorded in respect to these arrangements as of December 31, 2023 or January 1, 2023. Line of Credit At December 31, 2023 and January 1, 2023, $24.9 million and $22.6 million, respectively, was outstanding on the revolving facilities. Average daily balance for Fiscal 2023, 2022 and 2021 was $23.1 million, $18.4 million, and $9.9 million, respectively. Borrowings under the revolving facilities consisted of and bore interest at (in thousands): December 31, January 1, Base Rate $ 4,874 9.75 % $ 2,562 8.25 % SOFR 3,000 7.69 % 20,000 6.45 % SOFR 2,000 7.71 % — — % SOFR 15,000 7.77 % — — % Total $ 24,874 $ 22,562 Long-Term Debt Long-term debt consisted of and bore interest at (in thousands): December 31, January 1, SOFR $ 34,000 7.79 % $ 40,000 6.72 % Long-term debt $ 34,000 $ 40,000 Maturities on the Revolving Facility with BMO and long-term debt as of , are as follows at (in thousands): Fiscal: December 31, 2024 $ 58,874 Less debt issuance costs (128) Total, net $ 58,746 Cash Flow Hedge In April 2020, the Company entered into a pay-fixed/receive-floating interest rate swap agreement with our bank syndicate led by BMO that reduces the floating interest rate component on the Term Loan obligation. The $25.0 million notional amount was designed as a cash flow hedge on the underlying variable rate interest payments against a fixed interest rate. In accordance with cash flow hedge accounting treatment, the Company had determined that the hedge was perfectly effective using the change-in-variable-cash-flow method. On March 21, 2022, the Company paid down the balance, which cancelled the agreement. The unrealized gains or losses associated with the change in the fair value of the effective portion of the hedging instrument was recorded in accumulated other comprehensive income or loss. The Company reclassified the interest rate swap from accumulated other comprehensive gain or loss against interest expense in the same period in which the hedge transaction affected earnings. Convertible Note At December 31, 2023 and January 1, 2023, the Company had a two-year convertible unsecured promissory note of $4.4 million due to the seller with an annual interest rate of 6%, with interest paid quarterly related to the Horn Solutions acquisition on December 12, 2022 (See “Note 3 - Acquisitions”). The promissory note is convertible into shares of our common stock at any time after the one-year anniversary of the promissory note at a conversion price equal to $17.12 per share, prior to the maturity date of December 12, 2024. The promissory note is subordinate to the Company’s senior debt. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The accounting standard for fair value measurements defines fair value and establishes a market-based framework or hierarchy for measuring fair value. The standard is applicable whenever assets and liabilities are measured at fair value. The fair value hierarchy established prioritizes the inputs used in valuation techniques into three levels as follows: Level 1 - Observable inputs - quoted prices in active markets for identical assets and liabilities; Level 2 - Observable inputs other than the quoted prices in active markets for identical assets and liabilities - includes quoted prices for similar instruments, quoted prices for identical or similar instruments in inactive markets, and amounts derived from valuation models where all significant inputs are observable in active markets, for substantially the full term of the financial instrument; and Level 3 - Unobservable inputs - includes amounts derived from valuation models where one or more significant inputs are unobservable and require us to develop relevant assumptions. The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis and the level they fall within the fair value hierarchy (in thousands): Amounts Recorded at Fair Value Financial Statement Classification Fair Value Hierarchy December 31, January 1, Convertible note Convertible note Level 2 $ 4,368 $ 4,368 Contingent consideration, net Contingent consideration, net - current and long-term Level 3 $ 8,320 $ 1,081 |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
EQUITY | EQUITY Authorized capital stock consists of 19,500,000 shares of common stock, par value $0.01 per share and 500,000 shares of undesignated preferred stock, par value $0.01 per share. Restricted Stock The Company issued net restricted common stock of 56,889 and 32,344 shares to team members and non-team member (non-employee) directors in Fiscal 2023 and Fiscal 2022, respectively. The restricted shares of $0.01 par value per share were issued under the 2013 Plan and contain a three-year service condition. The restricted stock constitutes issued and outstanding shares of the Company’s common stock, except for the right of disposal, for all purposes during the period of restriction including voting rights and dividend distributions. In connection with the vesting portions of the restricted stock, the Company repurchased 2,085, -0-, and 610 shares of company stock, or treasury stock, to satisfy the withholding obligation in connection with the vesting of a portion of the restricted stock for Fiscal 2023, 2022, and 2021, respectively. Treasury stock is accounted for under the cost method whereby the entire cost of the acquired stock is recorded. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | SHARE-BASED COMPENSATION Stock Options In December 2013, the board of directors adopted the original 2013 Plan. Under the original 2013 Plan team members, directors and consultants of the Company may receive incentive stock options and other awards. To the extent any option or award expires unexercised or is canceled, terminated or forfeited in any manner without the issuance of common stock thereunder, such shares shall again be available for issuance under the original 2013 Plan. As of December 31, 2023, a total of 1,215,987 shares remain available for issuance under the 2013 Plan. The term of each option is determined by the board of directors but cannot exceed 10 years. Unless otherwise specified in an option agreement, options vest and become exercisable on the following schedule: 20% immediately and 20% on each anniversary date of the grant date. Each option shall be designated as an incentive stock option (“ISO”) or a non-qualified option (“NQO”). The exercise price of an ISO shall not be less than the fair market value of the stock covered by the ISO at the grant date; provided, however, the exercise price of an ISO granted to any person who owns, directly or indirectly, stock of the Company constituting more than 10% of the total combined voting power of all classes of outstanding stock of the Company or of any affiliate of the Company, shall not be less than 110% of such fair market value. The fair value of each option award was estimated on the date of grant using a Black-Scholes option pricing model and the assumptions in the following table. Because this option valuation model incorporates ranges of assumptions for inputs, those ranges are disclosed below. The Company bases the estimate of expected volatility on the historical volatilities of the Company for a period equal to the expected life of the option. The risk-free rate for periods within the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company expects to use historical data to estimate team member termination within the valuation model; separate groups of team members that have similar historical termination behavior are considered separately for valuation purposes. The Company believes these estimates and assumptions are reasonable. However, these estimates and assumptions may change in the future based on actual experience as well as market conditions. For Fiscal 2023, 2022 and 2021, the Company recognized $0.4 million, $0.7 million and $0.6 million of compensation expense from continuing operations related to stock awards, respectively. Unamortized share-based compensation expense from continuing operations as of December 31, 2023 amounted to $0.9 million which is expected to be recognized over the next 2.6 years. The following assumptions were used to estimate the fair value of stock options for the years ended: December 31, 2023 January 1, 2023 December 26, 2021 Weighted-average fair value of awards $ 3.00 $ 5.17 $ 4.91 Weighted-average risk-free interest rate 4.2 % 2.7 % 0.8 % Weighted-average dividend yield $ 0.60 $ 0.54 $ 0.35 Weighted-average volatility factor 52.8 % 54.6 % 53.3 % Weighted-average expected life 10.0 yrs 10.0 yrs 10.0 yrs A summary of stock option activity is presented as follows: Number of Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life Total Intrinsic Value of Options Awards outstanding at December 27, 2020 652,655 $ 17.63 7.1 $ 665 Granted 116,374 $ 11.57 Exercised (1,350) $ 9.72 Forfeited / Canceled (72,350) $ 15.01 Awards outstanding at December 26, 2021 695,329 $ 16.91 6.7 $ 665 Granted 164,000 $ 12.87 Exercised (1,000) $ 9.75 Forfeited / Canceled (36,650) $ 17.65 Awards outstanding at January 1, 2023 821,679 $ 16.08 6.4 $ 1,907 Granted 126,470 $ 10.02 Exercised (4,800) $ 6.25 Forfeited / Canceled (21,039) $ 17.38 Awards outstanding at December 31, 2023 922,310 $ 15.30 6.0 $ 104 Awards exercisable at January 1, 2023 573,863 $ 17.50 5.4 $ 1,164 Awards exercisable at December 31, 2023 663,740 $ 16.84 5.0 $ 103 Number of Weighted Average Grant Date Fair Value Non-vested outstanding at January 1, 2023 247,816 $ 7.64 Non-vested outstanding at December 31, 2023 258,570 $ 7.84 During Fiscal 2023 and 2022, there were no cashless stock option exercises. During Fiscal 2021 the Company issued 213 shares of common stock upon the cashless exercise of 600 stock options. Restricted Stock For Fiscal 2023, 2022 and 2021, the Company recognized $0.6 million, $0.4 million, and $0.5 million, respectively, of compensation expense related to restricted stock. Unamortized share-based compensation expense as of December 31, 2023 amounted to $0.6 million which is expected to be recognized over the next 1.8 years. A summary of restricted stock activity is presented as follows: Number of Weighted Average Grant Date Fair Value Restricted outstanding at December 27, 2020 25,218 $ 16.01 Issued 64,702 $ 12.04 Vested (29,076) $ 15.75 Restricted outstanding at December 26, 2021 60,844 $ 11.91 Issued 32,344 $ 13.14 Vested (31,168) $ 11.79 Restricted outstanding at January 1, 2023 62,020 $ 12.21 Issued 57,974 $ 11.22 Vested (43,303) $ 11.71 Forfeited / Canceled (967) $ 12.62 Restricted outstanding at December 31, 2023 75,724 $ 11.73 Nonvested outstanding at January 1, 2023 62,020 $ 12.21 Nonvested outstanding at December 31, 2023 75,724 $ 11.73 Warrant Activity For Fiscal 2023, 2022 and 2021, the Company did not recognize compensation cost related to warrants. There was no unamortized stock compensation expense remaining to be recognized as of December 31, 2023. A summary of warrant activity is presented as follows: Number of Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life Total Intrinsic Value of Warrants Warrants outstanding at December 27, 2020 25,862 $ 16.80 0.4 $ — Expired (25,862) $ 16.80 Warrants outstanding at December 26,2021, January 1, 2023, and December 31, 2023 — $ — 0.0 $ — Warrants exercisable January 1, 2023 and December 31, 2023 — $ — 0.0 $ — There were no non-vested warrants outstanding at December 31, 2023, January 1, 2023, and December 26, 2021. There were no exercises of warrants in Fiscal 2023, 2022, and 2021. The intrinsic value in the tables above is the amount by which the market value of the underlying stock exceeded the exercise price of outstanding options or warrants, before applicable income taxes and represents the amount holders would have realized if all in-the-money options or warrants had been exercised on the last business day of the period indicated. 2020 Employee Stock Purchase Plan (“2020 ESPP”) In November 2020, the Company’s shareholders approved the 2020 ESPP. Under the 2020 ESPP, eligible team members of the Company may elect for payroll deductions to purchase shares on each purchase date during an offering period. A total of 250,000 shares of common stock of BGSF, Inc. were initially reserved for issuance pursuant to the 2020 ESPP. For Fiscal 2023, and 2022, the Company issued 54,305 and 59,506 shares of common stock under the 2020 ESPP, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS There were no related party transactions in Fiscal 2023, 2022, or 2021. |
TEAM MEMBER BENEFIT PLAN
TEAM MEMBER BENEFIT PLAN | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
TEAM MEMBER BENEFIT PLAN | TEAM MEMBER BENEFIT PLAN Defined Contribution Plan The Company provides a defined contribution plan (the “401(k) Plan”) for the benefit of its eligible team members and field talent. The 401(k) Plan allows participants to make contributions subject to applicable statutory limitations. The Company matches participants contributions 100% up to the first 3% and 50% of the next 2% of a team member or field talent’s compensation. The Company contributed $2.0 million, $1.5 million and $1.5 million from continuing operations to the 401(k) Plan for Fiscal 2023, 2022 and 2021, respectively. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | BUSINESS SEGMENTS The Company has continuing operations through the Property Management and Professional segments. Segment (loss) income from continuing operations includes all revenue and cost of services, direct selling expenses, depreciation and amortization expense and excludes all general and administrative (home office) expenses. Assets of home office include cash, unallocated prepaid expenses, property and equipment, deferred tax assets, and other assets. The following table provides a reconciliation of revenue and (loss) income from continuing operations by reportable segment to consolidated results for the periods indicated at (in thousands): December 31, 2023 January 1, 2023 December 26, 2021 Revenue: Property Management $ 125,077 $ 121,093 $ 92,018 Professional 188,090 177,329 147,009 Total $ 313,167 $ 298,422 $ 239,027 Depreciation: Property Management $ 133 $ 179 $ 210 Professional 263 355 390 Home office 50 63 85 Total $ 446 $ 597 $ 685 Amortization: Professional $ 6,198 $ 2,338 $ 2,431 Home office 1,130 1,119 582 Total $ 7,328 $ 3,457 $ 3,013 December 31, 2023 January 1, 2023 December 26, 2021 Operating (loss) income: Property Management $ 23,155 $ 19,803 $ 14,663 Professional - without CARES Act credit and impairment loss 12,292 15,604 10,340 Professional - CARES Act credit — — 921 Professional - impairment loss (22,545) — — Home office - general and administrative (20,087) (19,124) (14,948) Home office - CARES Act credit — — 1,150 Home office - gain on contingent consideration — — 2,404 Total $ (7,185) $ 16,283 $ 14,530 Capital Expenditures: Property Management $ 70 $ 135 $ 106 Professional 444 90 107 Home office 2,083 5,455 2,991 Total $ 2,597 $ 5,680 $ 3,204 Total Assets: Property Management $ 29,884 $ 29,302 Professional 122,751 141,018 Home office 25,882 24,353 Total $ 178,517 $ 194,673 |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2023 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | QUARTERLY FINANCIAL DATA (UNAUDITED) December 31, 2023 First Second Third Fourth Fiscal Revenues $ 75,316 $ 80,800 $ 83,484 $ 73,567 $ 313,167 Gross profit $ 26,784 $ 29,574 $ 29,979 $ 25,447 $ 111,784 Net (loss) income $ (16,466) $ 2,604 $ 2,640 $ 999 $ (10,223) Net (loss) income per share: Basic $ (1.54) $ 0.24 $ 0.24 $ 0.11 $ (0.95) Diluted $ (1.54) $ 0.24 $ 0.24 $ 0.11 $ (0.95) Weighted-average shares outstanding: Basic 10,712 10,759 10,791 10,812 10,766 Diluted 10,712 10,770 10,803 10,823 10,766 January 1, 2023 First Second Third Fourth Fiscal Revenues $ 68,542 $ 74,089 $ 78,508 $ 77,283 $ 298,422 Gross Profit $ 23,431 $ 25,059 $ 28,000 $ 27,058 $ 103,548 Income from continuing operations $ 2,008 $ 3,184 $ 4,652 $ 1,417 $ 11,261 Income (loss) from discontinued operations, net of tax $ 13,792 $ (7) $ — $ 315 $ 14,100 Net income $ 15,800 $ 3,177 $ 4,652 $ 1,732 $ 25,361 Net income per share - basic: Income from continuing operations $ 0.19 $ 0.31 $ 0.44 $ 0.14 $ 1.08 Income from discontinued operations 0.12 — — — 0.12 Gain on sale 1.65 — — 0.04 1.69 Income tax expense (0.45) — — (0.01) (0.46) Net income per share - basic $ 1.51 $ 0.31 $ 0.44 $ 0.17 $ 2.43 Net income per share - diluted: Income from continuing operations $ 0.19 $ 0.30 $ 0.44 $ 0.14 $ 1.07 Income from discontinued operations 0.12 — — — 0.12 Gain on sale 1.66 — — 0.03 1.69 Income tax expense (0.45) — — (0.01) (0.46) Net income per share - diluted $ 1.52 $ 0.30 $ 0.44 $ 0.16 $ 2.42 Weighted-average shares outstanding: Basic 10,429 10,472 10,492 10,501 10,427 Diluted 10,485 10,514 10,533 10,544 10,473 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Dividend On February 7, 2024, the Company’s board of directors declared a cash dividend in the amount of $0.15 per share of common stock to be paid on February 27, 2024 to all shareholders of record as of the close of business on February 20, 2024. Credit Agreement On March 12, 2024, the Credit Agreement was amended and restated through the Company’s entry into an Amended and Restated Credit Agreement with certain lenders, BMO Bank, N.A., as administrative agent, letter of credit Issuer, and swing line lender, and BMO Capital Markets Corp., as sole lead arranger and sole book runner. The Amended and Restated Credit Agreement has a maturity date of March 12, 2028. The Amended and Restated Credit Agreement provides for a revolving credit facility permitting us to borrow funds from time to time in an aggregate amount up to $40 million. Term loans with an outstanding principal balance of $34 million were outstanding under the Credit Agreement remain outstanding under the Amended and Restated Credit Agreement. The Amended and Restated Credit Agreement further provides for a delayed draw term loan commitment of $4.3 million. The Company is required to repay the term loans in quarterly principal installments in an amount equal to 2.5% of the aggregate principal balance thereof. The Amended and Restated Credit Agreement provides for interest either at the Base Rate plus the Applicable Margin, or the Adjusted Term SOFR plus the Applicable Margin (in each case, as such terms are defined in the Amended and Restated Credit Agreement). The Amended and Restated Credit Agreement also provides for letter of credit fees and commitment fees as further described therein. The Company’s obligations under the Amended and Restated Credit Amendment are secured by a first priority security interest in substantially all of the Company’s and its Subsidiaries’ tangible and intangible property. The Amended and Restated Credit Agreement provides for a maximum Leverage Ratio and a minimum Fixed Charge Coverage Ratio (as such terms are defined in the Amended and Restated Credit Amendment), and also provides for, among other items, representations and warranties and affirmative and negative covenants, as described therein. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of the Company. All significant intercompany transactions and balances have been eliminated in consolidation. |
Fiscal Year | Fiscal Year The Company has a 52/53 week fiscal year. Fiscal years for the consolidated financial statements included herein are for the 52 weeks ended December 31, 2023, and 53 weeks ended January 1, 2023, and the 52 weeks ended December 26, 2021, referred as Fiscal 2023, 2022, and 2021, respectively. |
Reclassifications | Reclassifications Certain reclassifications have been made to the 2022 and 2021 financial statements to conform with the 2023 presentation. |
Management Estimates | Management Estimates The preparation of consolidated financial statements in conformity with generally accepted accounting principles in United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates affecting the financial statements include allowances for credit losses, goodwill, intangible assets, lease liabilities, contingent consideration obligations related to acquisitions, and income taxes. Additionally, the valuation of share-based compensation expense uses a model based upon interest rates, stock prices, maturity estimates, volatility and other factors. The |
Financial Instruments | Financial Instruments The Company uses fair value measurements in areas that include, but are not limited to, the allocation of purchase price consideration to tangible and identifiable intangible assets, convertible debt, contingent consideration, and interest rate swap agreements. The carrying values of cash, accounts receivables, accounts payable, accrued payroll and expenses, and other current assets and liabilities approximate their fair values because of the short-term nature of these instruments. The carrying value of bank debt approximates fair value due to the variable nature of the interest rates under the credit agreement with BMO Harris Bank, N.A. (“BMO”) that provides for a revolving credit facility, term loan and current rates available to the Company for debt with similar terms and risk. In Fiscal 2022 and 2021, Management determined the fair value on the interest rate swap based on quoted prices from BMO. |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Accounts Receivable | Accounts Receivable |
Property and Equipment | Property and Equipment The Company depreciates the cost of property and equipment over the estimated useful lives of the assets using the straight-line method ranging from five |
Deposits | Deposits The Company maintains guaranteed costs policies for workers’ compensation coverage in monopolistic states and minimal loss retention coverage in all other states. Under these policies, the Company is required to maintain refundable deposits of $2.4 million, which are included in Deposits in the accompanying consolidated balance sheets, as of December 31, 2023 and January 1, 2023. |
Other Assets | Software as a service The Company capitalizes direct costs incurred in cloud computing implementation costs from hosting arrangements, and are reported as a component of Software as a service. All other internal-use software development costs are capitalized and reported as a component of computer software within Intangible assets. In Fiscal 2023, the Company added software assets of $0.6 million and reclassified $0.7 million from property and equipment related to the information technology improvement project. |
Leases | Leases The Company leases all their office space through operating leases, which expire at various dates through 2030. Many of the lease agreements obligate the Company to pay real estate taxes, insurance and certain maintenance costs, which are accounted for separately. Certain of the Company’s lease arrangements contain renewal provisions from 1 to 10 years, exercisable at the Company’s option. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company determines if an arrangement is an operating lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. All other leases are recorded on the balance sheet as right-of-use assets and lease liabilities for the lease term. Right-of-use lease assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term and include options to extend or terminate the lease when they are reasonably certain to be exercised. The present value of lease payments is determined using the incremental borrowing rate based on the information available at lease commencement date, unless the implicit rate in the lease is readily determinable. The Company’s operating lease expense is recognized on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. |
Intangible Assets | Intangible Assets The Company holds intangible assets with finite lives. Intangible assets with finite useful lives are amortized over their respective estimated useful lives, ranging from three Identifiable Intangible assets recognized in conjunction with acquisitions are recorded at fair value. Significant unobservable inputs are used to determine the fair value of the identifiable Intangible assets based on the income approach valuation model whereby the present worth and anticipated future benefits of the identifiable Intangible assets are discounted back to their net present value. The Company capitalizes purchased software and internal payroll costs directly incurred in the modification of internal use software. Software maintenance and training costs are expensed in the period incurred. The Company evaluates the recoverability of Intangible assets whenever events or changes in circumstances indicate that an Intangible asset’s carrying amount may not be recoverable. The Company considered the current and expected future economic and market conditions and its impact on each of the reporting units. The Company annually evaluates the remaining useful lives of all Intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization. In the first quarter of Fiscal 2023, management decided to eliminate the use of various trade names and go to market under the BGSF brand. Management’s rebranding created an impairment charge of $22.5 million. The Company determined that there were no impairment indicators for these assets in Fiscal 2022. |
Goodwill | Goodwill Goodwill represents the difference between the total consideration paid less the fair value of all recognized net asset fair values including identifiable intangible asset values in a business combination. The Company reviews goodwill for impairment annually during the fourth quarter or whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Based on annual testing, the Company has determined that there was no goodwill impairment in Fiscal 2023, 2022 or 2021. The Company first evaluates qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of the reporting unit is less than its carrying amount, including goodwill. If after qualitatively assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then further testing is unnecessary. If after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company then estimates the fair value of the reporting unit and compares the fair value of the reporting unit with its carrying amount, including goodwill, as discussed below. In assessing whether it is more likely than not that an indefinite-lived intangible asset is impaired, the Company assesses relevant events and circumstances that could affect the significant inputs used to determine the fair value. The quantitative impairment test for an indefinite-lived intangible asset consists of a comparison of the fair value of the asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, a reporting unit shall recognize an impairment loss in an amount equal to that excess. The quantitative goodwill impairment test involves a two-step process. In the first step, the Company compares the fair value of each reporting unit to its carrying value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and no further testing is required. If the fair value of the reporting unit is less than the carrying value, the Company must perform the second step of the impairment test to measure the amount of impairment loss. In the second step, the reporting unit’s fair value is allocated to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill in the same manner as if the reporting unit was being acquired in a business combination. If the implied fair value of the reporting unit's goodwill is less than the carrying value, the difference is recorded as an impairment loss. |
Cash Flow Hedge | Cash Flow Hedge The unrealized gains or losses associated with the change in the fair value of the effective portion of the hedging instrument was recorded in accumulated other comprehensive income or loss. The Company reclassified the interest rate swap from accumulated other comprehensive gain or loss against interest expense in the same period in which the hedge transaction affected earnings. There were no outstanding cash flow hedges at December 31, 2023 or January 1, 2023. |
Debt Issuance Costs | Debt Issuance Costs |
Contingent Consideration | Contingent Consideration The Company has obligations, to be paid in cash, related to its acquisitions if certain operating and financial goals are met. The fair value of this contingent consideration is determined using expected cash flows and present value technique. The fair value calculation of the expected future payments uses a discount rate commensurate with the risks of the expected cash flow. The resulting discount is amortized as interest expense over the outstanding period using the effective interest method. |
Revenue Recognition | Revenue Recognition The Company derives its revenues from continuing operations in Property Management and Professional segments by providing workforce solutions, placement services, and managed services. Revenues are recognized when promised services are delivered to client partners, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenues from continuing operations as presented on the consolidated statements of operations and comprehensive (loss) income represent services rendered to client partners less sales adjustments and allowances. Reimbursements, including those related to out-of-pocket expenses, are also included in revenues, and the related amounts of reimbursable expenses are included in cost of services. The Company records revenue on a gross basis as a principal versus on a net basis as an agent in the presentation of revenues and expenses. The Company has concluded that gross reporting is appropriate because the Company (i) has the risk of identifying and hiring qualified field talent, (ii) has the discretion to select the field talent and establish their price and duties and (iii) bears the risk for services that are not fully paid for by client partners. Workforce solution revenues - Field talent revenues from contracts with client partners are recognized in the amount to which the Company has a right to invoice, when the services are rendered by the Company’s field talent. Contingent placement revenues - Any revenues associated with workforce solutions that are provided on a contingent basis are recognized once the contingency is resolved, as this is when control is transferred to the client partner, usually when employment candidates start their employment. Retained search placement revenues - Any revenues from these workforce solutions are recognized based on the contractual amount for services completed to date which best depicts the transfer of control of services, which is less than 1% of consolidated revenues. Managed services revenues - include both workforce solution revenues and fixed fee revenues from client partner contracts. Services performed represent the transfer of control to the client partner over a given period of time. Fixed fee revenues are recognized in equal amounts at fixed intervals as promised services are delivered. The Company estimates the effect of placement candidates who do not remain with its client partners through the guarantee period (generally 90 days) based on historical experience. Allowances, recorded as a liability, are established to estimate these losses. Fees to client partners are generally calculated as a percentage of the new worker’s annual compensation. No fees for placement workforce solutions are charged to employment candidates. These assumptions determine the timing of revenue recognition for the reported period. Refer to Note 19 for disaggregated revenues by segment. Payment terms in the Company’s contracts vary by the type and location of its client partner and the workforce solutions offered. The term between invoicing and when payment is due is not significant. There were no unsatisfied performance obligations as of December 31, 2023 or January 1, 2023. There were no revenues recognized during Fiscal 2023 related to performance obligations satisfied or partially satisfied in previous periods. There are no contract costs capitalized. The Company did not recognize any contract impairments during Fiscal 2023, 2022, and 2021. The opening balance of accounts receivable at December 26, 2021, was $48.1 million. |
Advertising | Advertising The Company recognizes advertising expense in selling, general and administrative expenses as the services are incurred. Total advertising expense from continuing operations for Fiscal 2023, 2022, and 2021 was $2.1 million, $2.0 million, and $2.0 million, respectively. |
Share-Based Compensation | Share-Based Compensation The Company recognizes compensation expense in selling, general and administrative expenses over the service period for options or restricted stock that are expected to vest and records adjustments to compensation expense at the end of the service period if actual forfeitures differ from original estimates. |
Earnings Per Share | Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by dividing income available to common stockholders by the weighted average number of common shares outstanding during the period adjusted to reflect potentially dilutive securities. Antidilutive shares are excluded from the calculation of earnings per share. |
Income Taxes | Income Taxes The current provision for income taxes represents estimated amounts payable or refundable on tax returns filed or to be filed for the year. The Company recognizes any penalties when necessary as part of selling, general and administrative expenses. As a matter of operation, we first calculated the effective tax on continuing operations, and then allocated the remaining taxes to our discontinued operations, in accordance with Accounting Standards Codification (“ASC”) Topic 740. As of December 31, 2023 and January 1, 2023, goodwill of $45.9 million and $50.4 million, respectively, which is limited annually and is expected to be deductible for tax purposes. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts are classified as noncurrent in the consolidated balance sheets. Deferred tax assets are also recognized for net operating loss and tax credit carryovers. The overall change in deferred tax assets and liabilities for the period measures the deferred tax expense or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustments to tax expense in the period of enactment. As of December 31, 2023, the Company has a $2.6 million net operating loss carry forward from the 2020 EdgeRock acquisition with no expiration date. These net operating losses are subject to an annual Internal Revenue Code Section 382 limitation of $1.3 million. Additionally, there was an increase of $5.2 million to the deferred tax assets related to the $22.5 million in impairment losses as of December 31, 2023. When appropriate, the Company will record a valuation allowance against net deferred tax assets to offset future tax benefits that may not be realized. In determining whether a valuation allowance is appropriate, the Company considers whether it is more likely than not that all or some portion of our deferred tax assets will not be realized, based in part upon management’s judgments regarding future events and past operating results. The Company believes that it is more likely than not that all deferred tax assets will be realized and thus, believes that a valuation allowance is not required as of December 31, 2023 or January 1, 2023. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures. The new standard provides guidance to improve reportable segment disclosure with enhanced reporting of significant segment expenses. The new guidance is effective after December 15, 2023, and interim periods beginning after December 15, 2024, early adoption is permitted. The Company is evaluating the impact of the new guidance on its consolidated financial statements and related disclosures. In December 2023, FASB issued ASU 2023-09, Income Taxes: Improvements to Income Tax Disclosures. The new standard requires annual disclosure of the specific categories in the rate reconciliation, and additional information for reconciling items that meet a quantitative threshold. Additional information may be required on reconciling items. The new guidance is effective after December 15, 2024, early adoption is permitted. The Company is evaluating the impact of the new guidance on its consolidated financial statements and related disclosures. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Revenue from External Customers by Geographic Areas | Geographic revenue from continuing operations in excess of 10% of the Company’s consolidated revenue in Fiscal 2023 and the related percentage for Fiscal 2022 and 2021 was generated in the following areas at: December 31, January 1, December 26, Tennessee 13 % 10 % 12 % Texas 25 % 23 % 23 % |
Summary of Valuation Allowance | the allowance for credit losses from continuing operations are as follows at (in thousands): December 31, January 1, Beginning balance $ 558 $ 449 Acquired allowance for credit losses - Horn Solutions — 109 Provision for credit losses, net 798 315 Amounts written off, net (802) (315) Ending balance $ 554 $ 558 |
Schedule of Weighted Average Number of Shares | The following is a reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the respective periods (in thousands): December 31, January 1, December 26, Weighted-average number of common shares outstanding: 10,766 10,427 10,367 Effect of dilutive securities: Stock options and restricted stock — 46 50 Weighted-average number of diluted common shares outstanding 10,766 10,473 10,417 |
Schedule of Securities excluded from Calculation of Earnings (loss) per Share | Stock options and restricted stock 812 360 402 Convertible note 255 255 — Antidilutive shares 1,067 615 402 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The purchase price has been allocated to the assets acquired and liabilities assumed as of the date of acquisition as follows (in thousands): Accounts receivable $ 3,734 Prepaid expenses and other assets 118 Property and equipment, net 83 Right-of-use asset - operating leases 1,528 Intangible assets 13,484 Goodwill (deductible tax basis of $26.1 million) 26,610 Current liabilities assumed (1,787) Lease liability - operating leases (1,528) Total net assets acquired $ 42,242 Cash $ 33,940 Hold back 1,000 Convertible Note 4,368 Common stock 3,351 Working capital adjustment (417) Total fair value of consideration transferred for acquired business $ 42,242 The preliminary purchase price has been allocated to the assets acquired and liabilities assumed as of the date of acquisition as follows (in thousands): Accounts receivable $ 3,452 Right-of-use asset - operating leases 141 Intangible assets 11,468 Goodwill (no deductible tax basis) 3,836 Current liabilities assumed (2,471) Lease liability - operating leases (140) Total net assets acquired $ 16,286 Cash $ 6,800 Hold back, working capital* 350 Hold back, indemnities* 850 Working capital adjustment* 677 Fair value of contingent consideration 7,609 Total fair value of consideration transferred for acquired business $ 16,286 *Included in Other current liabilities |
Allocation of Intangible Assets | The allocation of the intangible assets is as follows (in thousands): Estimated Fair Estimated Covenants not to compete $ 50 5 years Client partner list 13,434 10 years Total $ 13,484 The allocation of the intangible assets is as follows (in thousands): Estimated Fair Estimated Covenants not to compete $ 352 5 years Client partner list 10,946 10 years Computer software 170 3 years Total $ 11,468 |
Business Acquisition, Pro Forma Information | The Company estimates what would have been reported if the revenues and net income from continuing operations of the Horn Solutions and Arroyo Consulting acquisitions had taken place on the first day of the Company’s Fiscal 2022 (in thousands, except income per share): December 31, January 1, Revenues $ 320 $ 346 Gross profit $ 114 $ 123 Net (loss) income from continuing operations $ (10) $ 13 Net (loss) income per share from continuing operations: Basic $ (0.89) $ 1.29 Diluted $ (0.89) $ 1.29 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | The financial results of InStaff are as follows at (in thousands): January 1, December 26, 2021 Revenue $ 16,465 $ 71,292 Cost of services 14,144 60,948 Gross profit 2,321 10,344 Selling expenses 1,062 5,684 Depreciation 24 90 Income from discontinued operations before gain on sale and income taxes $ 1,235 $ 4,570 |
OTHER CURRENT ASSETS (Tables)
OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other current assets [Abstract] | |
Schedule of Other Current Assets | consist of the following at (in thousands): December 31, January 1, CARES Act receivable $ 2,188 $ 2,368 Deferred consideration — 2,000 Income tax receivable 685 1,667 Horn Solutions working capital adjustment — 534 Workers’ compensation deposit refund receivable — 448 Due from Arroyo and Sentech, respectively 3,843 411 Other 456 31 $ 7,172 $ 7,459 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | consist of the following at (in thousands): December 31, January 1, Leasehold improvements $ 665 $ 1,397 Furniture and fixtures 1,152 1,506 Computer systems 3,476 4,077 5,293 6,980 Accumulated depreciation (4,076) (4,899) Property and equipment, net $ 1,217 $ 2,081 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases, Operating [Abstract] | |
Lessee, Operating Lease, Liability, Maturity | The undiscounted annual future minimum lease payments of continuing operations consist of the following at (in thousands): December 31, 2023 2024 $ 2,306 2025 1,591 2026 1,211 2027 852 2028 512 Thereafter 74 Total lease payment 6,546 Interest (716) Present value of lease liabilities $ 5,830 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | Finite and indefinite lived intangible assets consist of the following at (in thousands): December 31, 2023 Gross Value Accumulated Net Finite lives: Client partner lists $ 69,114 $ 44,150 $ 24,964 Covenants not to compete 2,743 2,153 590 Computer software 7,825 3,009 4,816 Total $ 79,682 $ 49,312 $ 30,370 January 1, 2023 Gross Value Accumulated Net Finite lives: Client partner lists $ 58,609 $ 38,227 $ 20,382 Covenants not to compete 2,391 1,886 505 Computer software 7,208 3,087 4,121 68,208 43,200 25,008 Indefinite lives: Trade names 23,977 1,433 22,544 Total $ 92,185 $ 44,633 $ 47,552 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated future amortization expense for the next five years and thereafter is as follows (in thousands): Fiscal Years Ending: 2024 $ 7,185 2025 5,593 2026 4,332 2027 3,125 2028 2,469 Thereafter 7,666 Total $ 30,370 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill as of and during the years ended were as follows at (in thousands): Property Management Professional Total December 26, 2021 $ 1,074 $ 28,068 $ 29,142 Additions from acquisitions — 26,051 26,051 January 1, 2023 1,074 54,119 55,193 Additions from acquisitions — 4,395 4,395 December 31, 2023 $ 1,074 $ 58,514 $ 59,588 |
ACCRUED PAYROLL AND EXPENSES _2
ACCRUED PAYROLL AND EXPENSES AND CONTINGENT CONSIDERATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accrued Liabilities, Current [Abstract] | |
Schedule of Accrued Liabilities | Accrued payroll and expenses consist of the following at (in thousands): December 31, January 1, Field talent payroll $ 5,014 $ 6,923 Field talent payroll related 1,039 941 Accrued bonuses and commissions 2,931 5,740 Other 5,918 5,567 Accrued payroll and expenses $ 14,902 $ 19,171 |
Schedule of Future Estimated Earnout Payments | The following is a schedule of future estimated contingent consideration payments at (in thousands): December 31, 2023 Estimated Cash Payment Discount Net Due in: Less than one year $ 4,250 $ (42) $ 4,208 One to two years 4,250 (138) 4,112 Contingent consideration $ 8,500 $ (180) $ 8,320 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The Company’s income tax expense for the fiscal years are comprised of the following at (in thousands): December 31, 2023 January 1, December 26, 2021 Current federal income tax $ (1,312) $ (589) $ (594) Current state income tax (825) (717) (766) Deferred tax benefit (income) 5,075 (2,353) (1,279) Income tax benefit (expense) from continuing operations 2,938 (3,659) (2,639) Income tax (expense) from discontinued operations — (4,810) (919) Income tax benefit (expense) $ 2,938 $ (8,469) $ (3,558) |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred income taxes are as follows at (in thousands): December 31, January 1, Deferred tax assets: Allowance for credit losses $ 120 $ 127 Goodwill and intangible assets 5,242 787 Accrued payroll and expenses 681 404 Contingent consideration 2,087 271 Share-based compensation 602 504 Net operating loss carry forward 662 985 Deferred tax liabilities: Prepaid expenses and other current assets (735) (579) Property and equipment (1,388) (303) Deferred income taxes, net $ 7,271 $ 2,196 |
Schedule of Effective Income Tax Rate Reconciliation | The income tax provision, reconciled to the tax computed at the statutory federal rate, is as follows at (in thousands): December 31, 2023 January 1, 2023 December 26, 2021 Tax benefit (expense) at federal statutory rate $ 2,764 (21.0) % $ (3,133) (21.0) % $ (2,750) (21.0) % State income tax benefit (expense), net of federal benefit 194 (1.5) % (795) (5.3) % (1,100) (8.4) % Equity, permanent differences and other (319) 2.3 % (178) (1.2) % 503 3.7 % Work Opportunity Tax Credit, net 299 (2.3) % 447 3.0 % 708 5.4 % Income tax benefit (expense) from continuing operations 2,938 (22.5) % (3,659) (24.5) % (2,639) (20.3) % Income tax (expense) from discontinued operations — — % (4,810) (24.5) % (919) (20.3) % Income tax benefit (expense) $ 2,938 (22.5) % $ (8,469) (24.5) % $ (3,558) (20.3) % |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Line of Credit Facilities | Borrowings under the revolving facilities consisted of and bore interest at (in thousands): December 31, January 1, Base Rate $ 4,874 9.75 % $ 2,562 8.25 % SOFR 3,000 7.69 % 20,000 6.45 % SOFR 2,000 7.71 % — — % SOFR 15,000 7.77 % — — % Total $ 24,874 $ 22,562 |
Schedule of Long-term Debt Instruments | Long-term debt consisted of and bore interest at (in thousands): December 31, January 1, SOFR $ 34,000 7.79 % $ 40,000 6.72 % Long-term debt $ 34,000 $ 40,000 |
Schedule of Maturities of Long-term Debt | Maturities on the Revolving Facility with BMO and long-term debt as of , are as follows at (in thousands): Fiscal: December 31, 2024 $ 58,874 Less debt issuance costs (128) Total, net $ 58,746 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis and the level they fall within the fair value hierarchy (in thousands): Amounts Recorded at Fair Value Financial Statement Classification Fair Value Hierarchy December 31, January 1, Convertible note Convertible note Level 2 $ 4,368 $ 4,368 Contingent consideration, net Contingent consideration, net - current and long-term Level 3 $ 8,320 $ 1,081 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Valuation Assumptions Used For Stock Options | The following assumptions were used to estimate the fair value of stock options for the years ended: December 31, 2023 January 1, 2023 December 26, 2021 Weighted-average fair value of awards $ 3.00 $ 5.17 $ 4.91 Weighted-average risk-free interest rate 4.2 % 2.7 % 0.8 % Weighted-average dividend yield $ 0.60 $ 0.54 $ 0.35 Weighted-average volatility factor 52.8 % 54.6 % 53.3 % Weighted-average expected life 10.0 yrs 10.0 yrs 10.0 yrs |
Stock Option Activity | A summary of stock option activity is presented as follows: Number of Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life Total Intrinsic Value of Options Awards outstanding at December 27, 2020 652,655 $ 17.63 7.1 $ 665 Granted 116,374 $ 11.57 Exercised (1,350) $ 9.72 Forfeited / Canceled (72,350) $ 15.01 Awards outstanding at December 26, 2021 695,329 $ 16.91 6.7 $ 665 Granted 164,000 $ 12.87 Exercised (1,000) $ 9.75 Forfeited / Canceled (36,650) $ 17.65 Awards outstanding at January 1, 2023 821,679 $ 16.08 6.4 $ 1,907 Granted 126,470 $ 10.02 Exercised (4,800) $ 6.25 Forfeited / Canceled (21,039) $ 17.38 Awards outstanding at December 31, 2023 922,310 $ 15.30 6.0 $ 104 Awards exercisable at January 1, 2023 573,863 $ 17.50 5.4 $ 1,164 Awards exercisable at December 31, 2023 663,740 $ 16.84 5.0 $ 103 |
Schedule of Nonvested Share Activity | Number of Weighted Average Grant Date Fair Value Non-vested outstanding at January 1, 2023 247,816 $ 7.64 Non-vested outstanding at December 31, 2023 258,570 $ 7.84 |
Share-based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity | A summary of restricted stock activity is presented as follows: Number of Weighted Average Grant Date Fair Value Restricted outstanding at December 27, 2020 25,218 $ 16.01 Issued 64,702 $ 12.04 Vested (29,076) $ 15.75 Restricted outstanding at December 26, 2021 60,844 $ 11.91 Issued 32,344 $ 13.14 Vested (31,168) $ 11.79 Restricted outstanding at January 1, 2023 62,020 $ 12.21 Issued 57,974 $ 11.22 Vested (43,303) $ 11.71 Forfeited / Canceled (967) $ 12.62 Restricted outstanding at December 31, 2023 75,724 $ 11.73 Nonvested outstanding at January 1, 2023 62,020 $ 12.21 Nonvested outstanding at December 31, 2023 75,724 $ 11.73 |
Warrant Activity | A summary of warrant activity is presented as follows: Number of Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life Total Intrinsic Value of Warrants Warrants outstanding at December 27, 2020 25,862 $ 16.80 0.4 $ — Expired (25,862) $ 16.80 Warrants outstanding at December 26,2021, January 1, 2023, and December 31, 2023 — $ — 0.0 $ — Warrants exercisable January 1, 2023 and December 31, 2023 — $ — 0.0 $ — |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | December 31, 2023 January 1, 2023 December 26, 2021 Revenue: Property Management $ 125,077 $ 121,093 $ 92,018 Professional 188,090 177,329 147,009 Total $ 313,167 $ 298,422 $ 239,027 Depreciation: Property Management $ 133 $ 179 $ 210 Professional 263 355 390 Home office 50 63 85 Total $ 446 $ 597 $ 685 Amortization: Professional $ 6,198 $ 2,338 $ 2,431 Home office 1,130 1,119 582 Total $ 7,328 $ 3,457 $ 3,013 December 31, 2023 January 1, 2023 December 26, 2021 Operating (loss) income: Property Management $ 23,155 $ 19,803 $ 14,663 Professional - without CARES Act credit and impairment loss 12,292 15,604 10,340 Professional - CARES Act credit — — 921 Professional - impairment loss (22,545) — — Home office - general and administrative (20,087) (19,124) (14,948) Home office - CARES Act credit — — 1,150 Home office - gain on contingent consideration — — 2,404 Total $ (7,185) $ 16,283 $ 14,530 Capital Expenditures: Property Management $ 70 $ 135 $ 106 Professional 444 90 107 Home office 2,083 5,455 2,991 Total $ 2,597 $ 5,680 $ 3,204 Total Assets: Property Management $ 29,884 $ 29,302 Professional 122,751 141,018 Home office 25,882 24,353 Total $ 178,517 $ 194,673 |
QUARTERLY FINANCIAL DATA (UNA_2
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data | December 31, 2023 First Second Third Fourth Fiscal Revenues $ 75,316 $ 80,800 $ 83,484 $ 73,567 $ 313,167 Gross profit $ 26,784 $ 29,574 $ 29,979 $ 25,447 $ 111,784 Net (loss) income $ (16,466) $ 2,604 $ 2,640 $ 999 $ (10,223) Net (loss) income per share: Basic $ (1.54) $ 0.24 $ 0.24 $ 0.11 $ (0.95) Diluted $ (1.54) $ 0.24 $ 0.24 $ 0.11 $ (0.95) Weighted-average shares outstanding: Basic 10,712 10,759 10,791 10,812 10,766 Diluted 10,712 10,770 10,803 10,823 10,766 January 1, 2023 First Second Third Fourth Fiscal Revenues $ 68,542 $ 74,089 $ 78,508 $ 77,283 $ 298,422 Gross Profit $ 23,431 $ 25,059 $ 28,000 $ 27,058 $ 103,548 Income from continuing operations $ 2,008 $ 3,184 $ 4,652 $ 1,417 $ 11,261 Income (loss) from discontinued operations, net of tax $ 13,792 $ (7) $ — $ 315 $ 14,100 Net income $ 15,800 $ 3,177 $ 4,652 $ 1,732 $ 25,361 Net income per share - basic: Income from continuing operations $ 0.19 $ 0.31 $ 0.44 $ 0.14 $ 1.08 Income from discontinued operations 0.12 — — — 0.12 Gain on sale 1.65 — — 0.04 1.69 Income tax expense (0.45) — — (0.01) (0.46) Net income per share - basic $ 1.51 $ 0.31 $ 0.44 $ 0.17 $ 2.43 Net income per share - diluted: Income from continuing operations $ 0.19 $ 0.30 $ 0.44 $ 0.14 $ 1.07 Income from discontinued operations 0.12 — — — 0.12 Gain on sale 1.66 — — 0.03 1.69 Income tax expense (0.45) — — (0.01) (0.46) Net income per share - diluted $ 1.52 $ 0.30 $ 0.44 $ 0.16 $ 2.42 Weighted-average shares outstanding: Basic 10,429 10,472 10,492 10,501 10,427 Diluted 10,485 10,514 10,533 10,544 10,473 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Revenue from External Customers by Geographic Areas (Details) - Sales Revenue, Net - Credit Risk | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Tennessee | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk, percentage | 13% | 10% | 12% |
Texas | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk, percentage | 25% | 23% | 23% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Changes in the Allowance for Doubtful Accounts (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Beginning balance | $ 558,000 | $ 449,000 | |
Acquired allowance for credit losses - Horn Solutions | 0 | 109,000 | |
Provision for credit losses | 798,000 | 315,000 | $ 221,000 |
Amounts written off, net | (802,000) | (315,000) | |
Ending balance | $ 554,000 | $ 558,000 | $ 449,000 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Summary Of Significant Accounting Policies [Line Items] | |||
Fiscal period, length | 364 days | 371 days | 364 days |
Deposits | $ 2,400,000 | ||
Impairment Of Intangible Asset Finite Lived Statement Of Income Or Comprehensive Income Extensible Enumeration Not Disclosed Flag | CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | ||
Goodwill, impairment loss | 0 | $ 0 | $ 0 |
Impairment losses | 22,545,000 | 0 | 0 |
Advertising expense | 2,100,000 | 2,000,000 | $ 2,000,000 |
Goodwill, amount expected to be tax deductible | 45,900,000 | $ 50,400,000 | |
Operating loss carryforward, not subject to expiration | 2,600,000 | ||
Net operating loss carry forward limitation | 1,300,000 | ||
Increase to deferred tax assets | 5,200,000 | ||
Other Assets | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Software assets | 600,000 | ||
Reclassifications of other assets | $ 700,000 | ||
Minimum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property, plant and equipment, useful life | 5 years | ||
Lessee, operating lease, renewal term (in years) | 1 year | ||
Finite-lived intangible asset, useful life | 3 years | ||
Maximum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property, plant and equipment, useful life | 7 years | ||
Lessee, operating lease, renewal term (in years) | 10 years | ||
Finite-lived intangible asset, useful life | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Weighted Average Number of Shares (Details) - shares | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Oct. 01, 2023 | Jul. 02, 2023 | Apr. 02, 2023 | Jan. 01, 2023 | Sep. 25, 2022 | Jun. 26, 2022 | Mar. 27, 2022 | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Schedule of Weighted Average Number of Shares, Diluted [Line Items] | |||||||||||
Weighted-average number of basic common shares outstanding | 10,812,000 | 10,791,000 | 10,759,000 | 10,712,000 | 10,501,000 | 10,492,000 | 10,472,000 | 10,429,000 | 10,766,000 | 10,427,000 | 10,367,000 |
Weighted-average number of diluted common shares outstanding (in shares) | 10,823,000 | 10,803,000 | 10,770,000 | 10,712,000 | 10,544,000 | 10,533,000 | 10,514,000 | 10,485,000 | 10,766,000 | 10,473,000 | 10,417,000 |
Stock options and restricted stock | |||||||||||
Schedule of Weighted Average Number of Shares, Diluted [Line Items] | |||||||||||
Effect of dilutive securities (in shares) | 0 | 46,000 | 50,000 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Antidilutive Securities (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share, amount | 1,067,000 | 615,000 | 402,000 |
Stock options and restricted stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share, amount | 812,000 | 360,000 | 402,000 |
Convertible Notes Payable | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share, amount | 255,000 | 255,000 | 0 |
ACQUISITIONS - Narrative (Detai
ACQUISITIONS - Narrative (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||||||
Dec. 12, 2022 | Feb. 08, 2021 | Oct. 01, 2023 | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | May 01, 2023 | Apr. 24, 2023 | |
Business Acquisition [Line Items] | ||||||||
Convertible note | $ 4,368,000 | $ 4,368,000 | ||||||
Debt instrument, convertible, conversion price | $ 17.12 | |||||||
Business combination, working capital adjustment | $ 100,000 | |||||||
Contingent consideration, net | $ 8,320,000 | $ 8,500,000 | ||||||
Effective tax rate for pro forma adjustments | (22.50%) | (24.50%) | (20.30%) | |||||
Momentum Solutionz | ||||||||
Business Acquisition [Line Items] | ||||||||
Business combination, acquisition related costs | $ 600,000 | |||||||
Horn Solutions, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Business combination, consideration transferred | $ 42,700,000 | |||||||
Cash consideration | 33,900,000 | |||||||
Common stock | 3,351,000 | |||||||
Issuance of shares, net of offering costs | 254,455 | |||||||
Convertible note | 4,368,000 | |||||||
Interest rate on convertible debt | 6% | |||||||
Escrow deposit | 1,000,000 | |||||||
Business combination, acquisition related costs | 400,000 | |||||||
Cash | $ 33,940,000 | |||||||
Arroyo Consulting | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash | 6,800,000 | |||||||
Holdback consideration, working capital | 350,000 | |||||||
Holdback consideration, indemnities | $ 850,000 | |||||||
Revenue of acquiree since acquisition date | $ 14,800,000 | |||||||
Operating income (loss) from acquiree since acquisition date | 4,000,000 | |||||||
Amortization of intangible assets of acquiree since acquisition | $ 700,000 | |||||||
Pro Forma | ||||||||
Business Acquisition [Line Items] | ||||||||
Effective tax rate for pro forma adjustments | 2,230% | 2,450% | ||||||
Pro Forma | Revolving Credit Facility | ||||||||
Business Acquisition [Line Items] | ||||||||
Line of credit facility, rate on additional borrowings | 2.50% |
ACQUISITIONS - Schedule of Reco
ACQUISITIONS - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) | 12 Months Ended | ||||
Dec. 12, 2022 | Dec. 31, 2023 | Apr. 24, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 59,588,000 | $ 55,193,000 | $ 29,142,000 | ||
Convertible note | 4,368,000 | 4,368,000 | |||
Horn Solutions, Inc. | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | $ 3,734,000 | ||||
Prepaid expenses and other assets | 118,000 | ||||
Property and equipment, net | 83,000 | ||||
Right-of-use asset - operating leases | 1,528,000 | ||||
Intangible assets | 13,484,000 | $ 13,484,000 | |||
Goodwill | 26,610,000 | ||||
Current liabilities assumed | (1,787,000) | ||||
Lease liability - operating leases | (1,528,000) | ||||
Total net assets acquired | 42,242,000 | ||||
Cash | 33,940,000 | ||||
Convertible note | 4,368,000 | ||||
Common stock | 3,351,000 | ||||
Working capital adjustment | (417,000) | 0 | $ 534,000 | ||
Total fair value of consideration transferred for acquired business | $ 42,242,000 | ||||
Arroyo Consulting | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | 3,452,000 | ||||
Right-of-use asset - operating leases | 141,000 | ||||
Intangible assets | 11,468,000 | ||||
Goodwill | 3,836,000 | ||||
Current liabilities assumed | (2,471,000) | ||||
Lease liability - operating leases | (140,000) | ||||
Total net assets acquired | 16,286,000 | ||||
Cash | 6,800,000 | ||||
Holdback consideration, working capital | 350,000 | ||||
Holdback consideration, indemnities | 850,000 | ||||
Working capital adjustment | 677,000 | ||||
Fair value of contingent consideration | $ 7,609,000 | ||||
Total fair value of consideration transferred for acquired business | $ 16,286,000 |
ACQUISITIONS - Allocation of In
ACQUISITIONS - Allocation of Intangible Assets (Details) - USD ($) | 12 Months Ended | |||
Apr. 24, 2023 | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 12, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, gross | $ 68,208,000 | |||
Client Partner List | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, gross | $ 69,114,000 | 58,609,000 | ||
Computer software | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, gross | 7,825,000 | $ 7,208,000 | ||
Horn Solutions, Inc. | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total | $ 13,484,000 | $ 13,484,000 | ||
Indefinite-lived intangible assets, Estimated Fair Value | $ 13,434,000 | |||
Horn Solutions, Inc. | Covenant not to compete | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, estimated fair value | $ 50,000 | |||
Finite-lived intangible asset, useful life | 10 years | |||
Arroyo Consulting | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total | $ 11,468,000 | |||
Arroyo Consulting | Covenant not to compete | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, estimated fair value | $ 352,000 | |||
Finite-lived intangible asset, useful life | 5 years | |||
Arroyo Consulting | Client Partner List | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, estimated fair value | $ 10,946,000 | |||
Finite-lived intangible asset, useful life | 10 years | |||
Arroyo Consulting | Computer software | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-lived intangible assets, gross | $ 170,000 | |||
Finite-lived intangible asset, useful life | 3 years |
ACQUISITIONS - Pro Forma Inform
ACQUISITIONS - Pro Forma Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Business Combinations [Abstract] | |||
Revenues | $ 320,000 | $ 346,000 | |
Gross profit | 114,000 | 123,000 | |
Net (loss) income from continuing operations | $ (10,000) | $ 13,000 | |
Earnings Per Share, Pro Forma [Abstract] | |||
Net income per share, basic (in dollars per share) | $ (0.89) | $ 1.29 | |
Net income per share, diluted (in dollars per share) | $ (0.89) | $ 1.29 | |
Effective tax rate for pro forma adjustments | (22.50%) | (24.50%) | (20.30%) |
DISCONTINUED OPERATIONS - Narra
DISCONTINUED OPERATIONS - Narrative (Details) - USD ($) | 1 Months Ended | |||
Mar. 21, 2022 | Oct. 31, 2022 | Dec. 31, 2023 | Jan. 01, 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Gain on sale | $ 17,300,000 | $ 400,000 | ||
Discontinued operations | Instaff | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Consideration | 30,300,000 | |||
Additional consideration | $ 2,000,000 | $ 0 | $ 2,000,000 |
DISCONTINUED OPERATIONS - Finan
DISCONTINUED OPERATIONS - Financial Results of Instaff (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Income from discontinued operations before gain on sale and income taxes | $ 0 | $ 1,235,000 | $ 4,570,000 |
Instaff | Discontinued operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Revenue | 16,465,000 | 71,292,000 | |
Cost of services | 14,144,000 | 60,948,000 | |
Gross profit | 2,321,000 | 10,344,000 | |
Selling expenses | 1,062,000 | 5,684,000 | |
Depreciation | 24,000 | 90,000 | |
Income from discontinued operations before gain on sale and income taxes | $ 1,235,000 | $ 4,570,000 |
OTHER CURRENT ASSETS (Details)
OTHER CURRENT ASSETS (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 12, 2022 | Mar. 21, 2022 |
Other current assets [Line Items] | ||||
CARES Act receivable | $ 2,188,000 | $ 2,368,000 | ||
Income tax receivable | 685,000 | 1,667,000 | ||
Workers’ compensation deposit refund receivable | 0 | 448,000 | ||
Due from Arroyo and Sentech, respectively | 3,843,000 | 411,000 | ||
Other | 456,000 | 31,000 | ||
Other current assets | 7,172,000 | 7,459,000 | ||
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (4,076,000) | (4,899,000) | ||
Leasehold improvements | 665,000 | 1,397,000 | ||
Furniture and fixtures | 1,152,000 | 1,506,000 | ||
Computer systems | 3,476,000 | 4,077,000 | ||
Horn Solutions, Inc. | ||||
Other current assets [Line Items] | ||||
Working capital adjustment | 0 | 534,000 | $ (417,000) | |
Discontinued operations | Instaff | ||||
Other current assets [Line Items] | ||||
Deferred consideration | $ 0 | $ 2,000,000 | $ 2,000,000 |
PROPERTY AND EQUIPMENT, NET - S
PROPERTY AND EQUIPMENT, NET - Schedule of Property and Equipment (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Property, Plant and Equipment [Abstract] | ||
Leasehold improvements | $ 665,000 | $ 1,397,000 |
Furniture and fixtures | 1,152,000 | 1,506,000 |
Computer systems | 3,476,000 | 4,077,000 |
Property and equipment, gross | 5,293,000 | 6,980,000 |
Accumulated depreciation | (4,076,000) | (4,899,000) |
Property and equipment, net | $ 1,217,000 | $ 2,081,000 |
PROPERTY AND EQUIPMENT, NET - N
PROPERTY AND EQUIPMENT, NET - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 446,000 | $ 597,000 | $ 685,000 |
Other assets | |||
Property, Plant and Equipment [Line Items] | |||
Reclassifications of other assets | 700,000 | ||
Other Intangible Assets | |||
Property, Plant and Equipment [Line Items] | |||
Reclassifications of other assets | $ 200,000 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Leases, Operating [Abstract] | |||
Operating lease, weighted average remaining lease term (years) | 3 years 6 months | 3 years 3 months 18 days | 2 years 8 months 12 days |
Operating lease, weighted average discount rate, percent | 6.50% | 5.20% | 5% |
Operating lease, payments | $ 2,185,000 | $ 2,115,000 | $ 2,136,000 |
Operating lease, cost | $ 2,155,000 | $ 1,887,000 | $ 1,907,000 |
LEASES - Undiscounted Annual Fu
LEASES - Undiscounted Annual Future Minimum Lease Payments (Details) | Dec. 31, 2023 USD ($) |
Leases, Operating [Abstract] | |
2024 | $ 2,306,000 |
2025 | 1,591,000 |
2026 | 1,211,000 |
2027 | 852,000 |
2028 | 512,000 |
Thereafter | 74,000 |
Total lease payment | 6,546,000 |
Interest | (716,000) |
Present value of lease liabilities | $ 5,830,000 |
LEASES (Details)
LEASES (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Leases [Abstract] | |||
Operating lease, weighted average remaining lease term (years) | 3 years 6 months | 3 years 3 months 18 days | 2 years 8 months 12 days |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 2,837,000 | $ 2,248,000 | $ 6,000 |
INTANGIBLE ASSETS - Schedule of
INTANGIBLE ASSETS - Schedule of Finite and Indefinite Lived Intangible Assets (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Value | $ 68,208,000 | |
Accumulated Amortization | 43,200,000 | |
Net Carrying Value | $ 30,370,000 | 25,008,000 |
Intangible assets net excluding goodwill gross | 79,682,000 | 92,185,000 |
Intangible assets accumulated amortization | 49,312,000 | 44,633,000 |
Intangible assets, net (excluding goodwill), total | 30,370,000 | 47,552,000 |
Trade Names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite lived intangible assets excluding goodwill gross | 23,977,000 | |
Indefinite lived intangible assets accumulated amortization | 1,433,000 | |
Indefinite-lived intangible assets (excluding goodwill) | 22,544,000 | |
Client Partner List | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Value | 69,114,000 | 58,609,000 |
Accumulated Amortization | 44,150,000 | 38,227,000 |
Net Carrying Value | 24,964,000 | 20,382,000 |
Covenants not to compete | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Value | 2,743,000 | 2,391,000 |
Accumulated Amortization | 2,153,000 | 1,886,000 |
Net Carrying Value | 590,000 | 505,000 |
Computer software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Value | 7,825,000 | 7,208,000 |
Accumulated Amortization | 3,009,000 | 3,087,000 |
Net Carrying Value | $ 4,816,000 | $ 4,121,000 |
INTANGIBLE ASSETS - Schedule _2
INTANGIBLE ASSETS - Schedule of Future Amortization Expense (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Fiscal Year Ending: | ||
2024 | $ 7,185,000 | |
2025 | 5,593,000 | |
2026 | 4,332,000 | |
2027 | 3,125,000 | |
2028 | 2,469,000 | |
Thereafter | 7,666,000 | |
Net Carrying Value | $ 30,370,000 | $ 25,008,000 |
INTANGIBLE ASSETS - Narrative (
INTANGIBLE ASSETS - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 7,300,000 | $ 3,500,000 | $ 3,000,000 |
Trade Names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite lived intangible assets excluding goodwill gross | $ 23,977,000 | ||
Other Intangible Assets | |||
Finite-Lived Intangible Assets [Line Items] | |||
Software assets | 1,500,000 | ||
Reclassifications of other assets | $ 200,000 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Jan. 01, 2023 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 55,193,000 | $ 29,142,000 |
Additions from acquisitions | 4,395,000 | 26,051,000 |
Goodwill, ending balance | 59,588,000 | 55,193,000 |
Property Management | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 1,074,000 | 1,074,000 |
Additions from acquisitions | 0 | 0 |
Goodwill, ending balance | 1,074,000 | 1,074,000 |
Professional | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 54,119,000 | 28,068,000 |
Additions from acquisitions | 4,395,000 | 26,051,000 |
Goodwill, ending balance | $ 58,514,000 | $ 54,119,000 |
ACCRUED PAYROLL AND EXPENSES _3
ACCRUED PAYROLL AND EXPENSES AND CONTINGENT CONSIDERATION - Schedule of Accrued Liabilities (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Accrued Liabilities, Current [Abstract] | ||
Field talent payroll | $ 5,014,000 | $ 6,923,000 |
Field talent payroll related | 1,039,000 | 941,000 |
Accrued bonuses and commissions | 2,931,000 | 5,740,000 |
Other | 5,918,000 | 5,567,000 |
Accrued payroll and expenses | $ 14,902,000 | $ 19,171,000 |
ACCRUED PAYROLL AND EXPENSES _4
ACCRUED PAYROLL AND EXPENSES AND CONTINGENT CONSIDERATION - Schedule of Future Estimated Earnout Payments (Details) - USD ($) | Dec. 31, 2023 | Apr. 24, 2023 |
Accrued Liabilities, Current [Abstract] | ||
Estimated cash payment, less than one year | $ 4,250,000 | |
Discount, less than one year | 42,000 | |
Net, less than one year | 4,208,000 | |
Estimate Cash Payment, one to two years | 4,250,000 | |
Interest Expense, Earn Out Payable In Year Two | (138,000) | |
Net, One to two years | 4,112,000 | |
Estimated Cash Payments, Total | 8,500,000 | |
Interest Expense, Earn Out Payable, Total | (180,000) | |
Contingent consideration, net | $ 8,320,000 | $ 8,500,000 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Income Tax Disclosure [Abstract] | ||
Income tax receivable | $ 685,000 | $ 1,667,000 |
Income taxes payable | $ 282,000 | $ 253,000 |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Tax Expense (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Income Tax Disclosure [Abstract] | |||
Current federal income tax | $ (1,312,000) | $ (589,000) | $ (594,000) |
Current state income tax | (825,000) | (717,000) | (766,000) |
Deferred tax benefit (income) | 5,075,000 | (2,353,000) | (1,279,000) |
Income tax benefit (expense) from continuing operations | 2,938,000 | (3,659,000) | (2,639,000) |
Income tax (expense) from discontinued operations | 0 | (4,810,000) | (919,000) |
Income tax benefit (expense) | $ 2,938,000 | $ (8,469,000) | $ (3,558,000) |
INCOME TAXES - Significant Comp
INCOME TAXES - Significant Components of Deferred Income Taxes (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Deferred tax assets: | ||
Allowance for credit losses | $ 120,000 | $ 127,000 |
Goodwill and intangible assets | 5,242,000 | 787,000 |
Accrued payroll and expenses | 681,000 | 404,000 |
Contingent consideration | 2,087,000 | 271,000 |
Share-based compensation | 602,000 | 504,000 |
Net operating loss carry forward | 662,000 | 985,000 |
Deferred tax liabilities: | ||
Prepaid expenses and other current assets | (735,000) | (579,000) |
Property and equipment | (1,388,000) | (303,000) |
Deferred income taxes, net | $ 7,271,000 | $ 2,196,000 |
INCOME TAXES - Schedule of Effe
INCOME TAXES - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Income Tax Disclosure [Abstract] | |||
Tax benefit (expense) at federal statutory rate | $ 2,764,000 | $ (3,133,000) | $ (2,750,000) |
Federal statutory income tax rate, percent | (21.00%) | (21.00%) | (21.00%) |
State income tax benefit (expense), net of federal benefit | $ 194,000 | $ (795,000) | $ (1,100,000) |
State and local income taxes, percent | (1.50%) | (5.30%) | (8.40%) |
Equity, permanent differences and other | $ (319,000) | $ (178,000) | $ 503,000 |
Equity, permanent difference and other, percent | 2.30% | (1.20%) | 3.70% |
Work Opportunity Tax Credit, net | $ 299,000 | $ 447,000 | $ 708,000 |
Work Opportunity Tax Credit, percent | (2.30%) | 3% | 5.40% |
Income tax benefit (expense) from continuing operations | $ 2,938,000 | $ (3,659,000) | $ (2,639,000) |
Income tax expense (benefit) from continuing operations, percent | (22.50%) | (24.50%) | (20.30%) |
Income tax (expense) from discontinued operations | $ 0 | $ (4,810,000) | $ (919,000) |
Income tax expense (benefit) from discontinued operations, percent | 0% | (24.50%) | (20.30%) |
Income tax benefit (expense) | $ 2,938,000 | $ (8,469,000) | $ (3,558,000) |
Effective tax rate for pro forma adjustments | (22.50%) | (24.50%) | (20.30%) |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | 12 Months Ended | |||||||
Mar. 31, 2023 | Dec. 31, 2023 USD ($) | Jan. 01, 2023 USD ($) $ / shares | Dec. 26, 2021 USD ($) | May 19, 2023 USD ($) | Dec. 12, 2022 USD ($) | Apr. 30, 2020 USD ($) | Jul. 16, 2019 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Letters of credit outstanding, amount | $ 100,000 | |||||||
Line of credit facility, amount outstanding | 0 | $ 22,303,000 | ||||||
Derivative, notional amount | $ 25,000,000 | |||||||
Convertible note | 4,368,000 | $ 4,368,000 | ||||||
Debt instrument, convertible, conversion price | $ / shares | $ 17.12 | |||||||
Horn Solutions, Inc. | ||||||||
Debt Instrument [Line Items] | ||||||||
Convertible note | $ 4,368,000 | |||||||
Interest rate on convertible debt | 6% | |||||||
Credit Agreement | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum increase | $ 41,000,000 | |||||||
Line Of Credit Facility, Increased Borrowing Capacity | $ 6,000,000 | |||||||
Credit Agreement | BMO Harris Bank, N.A. | Term Loan Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt | $ 30,000,000 | |||||||
Line of credit facility, maximum increase | $ 40,000,000 | |||||||
Credit Agreement | BMO Harris Bank, N.A. | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 35,000,000 | |||||||
Percentage of principal balance due at quarter end | 0.025 | |||||||
Credit Agreement | BMO Harris Bank, N.A. | Revolving Credit Facility | Line of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, amount outstanding | 24,900,000 | |||||||
Average daily balance | $ 23,100,000 | |||||||
Credit Agreement | Texas Capital Bank, National Association (TCB) | Revolving Credit Facility | Line of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, amount outstanding | $ 22,600,000 | |||||||
Average daily balance | $ 18,400,000 | $ 9,900,000 |
DEBT - Borrowings under the Rev
DEBT - Borrowings under the Revolving Facility (Details) - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Line of Credit Facility [Line Items] | ||
Borrowings under revolving credit facilities | $ 24,746,000 | $ 0 |
Line Of Credit Facility, Initial Borrowing | Revolving Credit Facility | Base Rate | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Borrowings under revolving credit facilities | $ 4,874,000 | $ 2,562,000 |
Interest rate on convertible debt | 9.75% | 8.25% |
Line Of Credit Facility, Second Borrowing | Revolving Credit Facility | SOFR | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Borrowings under revolving credit facilities | $ 3,000,000 | $ 20,000,000 |
Interest rate on convertible debt | 7.69% | 6.45% |
Line Of Credit Facility, Third Borrowing | Revolving Credit Facility | SOFR | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Borrowings under revolving credit facilities | $ 2,000,000 | $ 0 |
Interest rate on convertible debt | 7.71% | 0% |
Line Of Credit Facility, Fourth Borrowing | Revolving Credit Facility | SOFR | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Borrowings under revolving credit facilities | $ 15,000,000 | $ 0 |
Interest rate on convertible debt | 7.77% | 0% |
Credit Agreement | SOFR | ||
Line of Credit Facility [Line Items] | ||
Interest rate on convertible debt | 7.79% | 6.72% |
Credit Agreement | Revolving Credit Facility | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Borrowings under revolving credit facilities | $ 24,874,000 | $ 22,562,000 |
DEBT - Schedule of Long Term De
DEBT - Schedule of Long Term Debt (Details) - Credit Agreement - USD ($) | Dec. 31, 2023 | Jan. 01, 2023 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 34,000,000 | $ 40,000,000 |
SOFR | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 34,000,000 | $ 40,000,000 |
Interest on long-term debt | 7.79% | 6.72% |
DEBT - Maturities on the Revolv
DEBT - Maturities on the Revolving Facility (Details) | Dec. 31, 2023 USD ($) |
Debt Disclosure [Abstract] | |
2024 | $ 58,874,000 |
Less debt issuance costs | (128,000) |
Long-term debt less deferred finance fees | $ 58,746,000 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Fair Value (Details) - USD ($) | Dec. 31, 2023 | Apr. 24, 2023 | Jan. 01, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Convertible note | $ 4,368,000 | $ 4,368,000 | |
Contingent consideration, net | 8,320,000 | $ 8,500,000 | |
Contingent consideration, net - current and long-term | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration, net | $ 8,320,000 | $ 1,081,000 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) | 12 Months Ended | |||
Dec. 12, 2022 USD ($) | Dec. 31, 2023 USD ($) | Jan. 01, 2023 USD ($) | Dec. 26, 2021 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Convertible note | $ 4,368,000 | $ 4,368,000 | ||
Interest expense on contingent consideration payable | 740,000 | $ 128,000 | $ 252,000 | |
Contingent consideration, net - current and long-term | Level 3 | Fair Value, Measurements, Recurring | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Cash consideration | $ (1,100,000) | |||
Horn Solutions, Inc. | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Convertible note | $ 4,368,000 | |||
Interest rate on convertible debt | 6% | |||
Cash consideration | $ (33,900,000) | |||
Discount Rate | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Discount rate (as a percent) | 0.07 | 0.09 |
EQUITY (Details)
EQUITY (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | Dec. 27, 2020 | |
Equity [Line Items] | ||||
Common stock, shares authorized (in shares) | 19,500,000 | 19,500,000 | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Common Stock | ||||
Equity [Line Items] | ||||
Issuance of restricted shares (in shares) | 56,889 | 32,344 | ||
Shares repurchased during period (in shares) | 2,085 | 0 | 610 |
SHARE-BASED COMPENSATION- Narra
SHARE-BASED COMPENSATION- Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | Nov. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Capital shares reserved for future issuance (in shares) | 1,215,987 | 250,000 | ||
Conversion of stock, shares issued (in shares) | 0 | 213 | ||
Exercised (in shares) | (600) | |||
Issuance of ESPP shares (in shares) | 54,305 | 59,506 | ||
Employee Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost related to stock awards | $ 400,000 | $ 700,000 | $ 600,000 | |
Unamortized stock compensation expense | $ 900,000 | |||
Unamortized stock compensation expense, recognition period | 2 years 7 months 6 days | |||
Exercised (in shares) | (4,800) | (1,000) | ||
Restricted Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost related to stock awards | $ 600,000 | $ 400,000 | $ 500,000 | |
Unamortized stock compensation expense | $ 600,000 | |||
Unamortized stock compensation expense, recognition period | 1 year 9 months 18 days | |||
Exercised (in shares) | (1,350) | |||
Warrant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost related to stock awards | $ 0 | $ 0 | $ 0 | |
Unamortized stock compensation expense | $ 0 | |||
Long Term Incentive Plan 2013 | Vested Immediately | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 20% | |||
Long Term Incentive Plan 2013 | Vesting Over Four Years | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 20% | |||
Maximum | Long Term Incentive Plan 2013 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expiration period, options (in years) | 10 years |
SHARE-BASED COMPENSATION- Stock
SHARE-BASED COMPENSATION- Stock Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | Dec. 27, 2020 | |
Number of Shares | ||||
Exercised (in shares) | (600) | |||
Employee Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted-average fair value of warrants (in dollars per share) | $ 3 | $ 5.17 | $ 4.91 | |
Weighted-average risk-free interest rate | 4.20% | 2.70% | 0.80% | |
Weighted-average dividend yield | 60% | 54% | 35% | |
Weighted-average volatility factor | 52.80% | 54.60% | 53.30% | |
Weighted-average expected life | 10 years | 10 years | 10 years | |
Number of Shares | ||||
Options outstanding at beginning of period (in shares) | 821,679 | 695,329 | 652,655 | |
Granted (in shares) | 126,470 | 164,000 | 116,374 | |
Exercised (in shares) | (4,800) | (1,000) | ||
Forfeited / Canceled (in shares) | (21,039) | (36,650) | (72,350) | |
Options outstanding at ending of period (in shares) | 922,310 | 821,679 | 695,329 | 652,655 |
Options exercisable (in shares) | 663,740 | 573,863 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||
Options outstanding at beginning of period (in dollars per share) | $ 16.08 | $ 16.91 | $ 17.63 | |
Granted (in dollars per share) | 10.02 | 12.87 | 11.57 | |
Exercised (in dollars per share) | 6.25 | 9.75 | 9.72 | |
Forfeited / Canceled (in dollars per share) | 17.38 | 17.65 | 15.01 | |
Options outstanding at ending of period (in dollars per share) | 15.30 | 16.08 | $ 16.91 | $ 17.63 |
Options exercisable at beginning of period (in dollars per share) (in shares) | 16.84 | 17.50 | ||
Options exercisable at ending of period (in dollars per share) (in shares) | $ 16.84 | $ 17.50 | ||
Options outstanding, weighted average remaining contractual term | 6 years | 6 years 4 months 24 days | 6 years 8 months 12 days | 7 years 1 month 6 days |
Options exercisable, weighted average remaining contractual term | 5 years | 5 years 4 months 24 days | ||
Options outstanding at beginning of period | $ 1,907 | $ 665 | $ 665 | |
Options outstanding at ending of period | 104 | 1,907 | $ 665 | $ 665 |
Options exercisable at beginning of period | 103 | 1,164 | ||
Options exercisable at ending of period | $ 103 | $ 1,164 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Nonvested, number of shares | 258,570 | 247,816 | ||
Nonvested options, weighted average grant date fair value | $ 7.84 | $ 7.64 |
SHARE-BASED COMPENSATION- Restr
SHARE-BASED COMPENSATION- Restricted Stock Activity (Details) - Restricted Stock - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Number of Shares | |||
Shares outstanding at beginning of period (in shares) | 62,020 | 60,844 | 25,218 |
Issued (in shares) | 57,974 | 32,344 | 64,702 |
Vested (in shares) | (43,303) | (31,168) | (29,076) |
Shares outstanding at ending of period (in shares) | 75,724 | 62,020 | 60,844 |
Weighted Average Grant Date Fair Value | |||
Beginning balance (in dollars per share) | $ 12.21 | $ 11.91 | $ 16.01 |
Issued (in dollars per share) | 11.22 | 13.14 | 12.04 |
Vested (in dollars per share) | 11.71 | 11.79 | 15.75 |
Ending balance (in dollars per share) | $ 11.73 | $ 12.21 | $ 11.91 |
Nonvested (in shares) | 75,724 | 62,020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Non-Option Equity Instruments, Forfeitures and Expirations | (967) | ||
Forfeited / Canceled, Weighted Average Granted Fair Value (in dollars per share) | $ 12.62 |
SHARE-BASED COMPENSATION- Sto_2
SHARE-BASED COMPENSATION- Stock Warrants Activity (Details) - Warrant - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 26, 2021 | Dec. 27, 2020 | |
Number of Shares | |||
Shares outstanding at beginning of period (in shares) | 25,862 | ||
Exercised | (25,862) | ||
Shares outstanding at ending of period (in shares) | 0 | 25,862 | |
Warrants exercisable (in shares) | 0 | ||
Weighted Average Exercise Price Per Share | |||
Warrants outstanding at beginning of period (in dollars per share) | $ 16.80 | ||
Exercised | $ 16.80 | ||
Warrants outstanding at ending of period (in dollars per share) | $ 0 | $ 16.80 | |
Warrants exercisable (in dollars per share) | $ 0 | ||
Warrants outstanding, weighted remaining contractual life | 0 years | 4 months 24 days | |
Warrants exercisable, weighted remaining contractual life | 0 years | ||
Warrants outstanding at beginning of period | $ 0 | ||
Warrants outstanding at ending of period | $ 0 | $ 0 | |
Warrants exercisable, total intrinsic value | $ 0 |
TEAM MEMBER BENEFIT PLAN (Detai
TEAM MEMBER BENEFIT PLAN (Details Textual) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined contribution plan, cost recognized | $ 2 | $ 1.5 | $ 1.5 |
First 3% Employee Compensation | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined contribution plan, employer matching contribution, percent of match | 100% | ||
Defined contribution plan, employer matching contribution, percent of employees' gross pay | 3% | ||
Next 2% Employee Compensation | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined contribution plan, employer matching contribution, percent of match | 50% | ||
Defined contribution plan, employer matching contribution, percent of employees' gross pay | 2% |
BUSINESS SEGMENTS (Details)
BUSINESS SEGMENTS (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Oct. 01, 2023 | Jul. 02, 2023 | Apr. 02, 2023 | Jan. 01, 2023 | Sep. 25, 2022 | Jun. 26, 2022 | Mar. 27, 2022 | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 73,567,000 | $ 83,484,000 | $ 80,800,000 | $ 75,316,000 | $ 77,283,000 | $ 78,508,000 | $ 74,089,000 | $ 68,542,000 | $ 313,167,000 | $ 298,422,000 | $ 239,027,000 |
Depreciation | 446,000 | 597,000 | 685,000 | ||||||||
Amortization: | 7,328,000 | 3,457,000 | 3,013,000 | ||||||||
Operating income (loss) | (7,185,000) | 16,283,000 | 14,530,000 | ||||||||
Capital Expenditures: | 2,597,000 | 5,680,000 | 3,204,000 | ||||||||
Total Assets | 178,517,000 | 194,673,000 | 178,517,000 | 194,673,000 | |||||||
Property Management | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 125,077,000 | 121,093,000 | 92,018,000 | ||||||||
Professional | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 188,090,000 | 177,329,000 | 147,009,000 | ||||||||
Operating Segments | Property Management | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation | 133,000 | 179,000 | 210,000 | ||||||||
Operating income (loss) | 23,155,000 | 19,803,000 | 14,663,000 | ||||||||
Capital Expenditures: | 70,000 | 135,000 | 106,000 | ||||||||
Total Assets | 29,884,000 | 29,302,000 | 29,884,000 | 29,302,000 | |||||||
Operating Segments | Professional | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation | 263,000 | 355,000 | 390,000 | ||||||||
Amortization: | 6,198,000 | 2,338,000 | 2,431,000 | ||||||||
Operating income (loss) | 12,292,000 | 15,604,000 | 10,340,000 | ||||||||
Capital Expenditures: | 444,000 | 90,000 | 107,000 | ||||||||
Total Assets | 122,751,000 | 141,018,000 | 122,751,000 | 141,018,000 | |||||||
Operating Segments | CARES Act Credit | Professional | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating income (loss) | 0 | 0 | 921,000 | ||||||||
Operating Segments | Impairment Loss | Professional | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating income (loss) | (22,545,000) | 0 | 0 | ||||||||
Home office | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation | 50,000 | 63,000 | 85,000 | ||||||||
Amortization: | 1,130,000 | 1,119,000 | 582,000 | ||||||||
Capital Expenditures: | 2,083,000 | 5,455,000 | 2,991,000 | ||||||||
Total Assets | $ 25,882,000 | $ 24,353,000 | 25,882,000 | 24,353,000 | |||||||
Home office | CARES Act Credit | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating income (loss) | 0 | 0 | 1,150,000 | ||||||||
Home office | General and Administrative Expense | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating income (loss) | (20,087,000) | (19,124,000) | (14,948,000) | ||||||||
Home office | Contingent consideration, net - current and long-term | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating income (loss) | $ 0 | $ 0 | $ 2,404,000 |
QUARTERLY FINANCIAL DATA (UNA_3
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2023 | Oct. 01, 2023 | Jul. 02, 2023 | Apr. 02, 2023 | Jan. 01, 2023 | Sep. 25, 2022 | Jun. 26, 2022 | Mar. 27, 2022 | Dec. 31, 2023 | Jan. 01, 2023 | Dec. 26, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 73,567,000 | $ 83,484,000 | $ 80,800,000 | $ 75,316,000 | $ 77,283,000 | $ 78,508,000 | $ 74,089,000 | $ 68,542,000 | $ 313,167,000 | $ 298,422,000 | $ 239,027,000 |
Gross Profit | 25,447,000 | 29,979,000 | 29,574,000 | 26,784,000 | 27,058,000 | 28,000,000 | 25,059,000 | 23,431,000 | 111,784,000 | 103,548,000 | 80,941,000 |
Income from continuing operations | 1,417,000 | 4,652,000 | 3,184,000 | 2,008,000 | (10,223,000) | 11,261,000 | 10,458,000 | ||||
Income (loss) from discontinued operations, net of tax | 315,000 | 0 | (7,000) | 13,792,000 | 14,100,000 | ||||||
Net (loss) income | $ 999,000 | $ 2,640,000 | $ 2,604,000 | $ (16,466,000) | $ 1,732,000 | $ 4,652,000 | $ 3,177,000 | $ 15,800,000 | $ (10,223,000) | $ 25,361,000 | $ 14,109,000 |
Net (loss) income per share - basic: | |||||||||||
Net Income from continuing operations (in dollars per share) | $ 0.11 | $ 0.24 | $ 0.24 | $ (1.54) | $ 0.14 | $ 0.44 | $ 0.31 | $ 0.19 | $ (0.95) | $ 1.08 | $ 1.01 |
Income from discontinued operations (in dollars per share) | 0 | 0 | 0 | 0.12 | 0.12 | ||||||
Gain on sale (in dollars per share) | 0.04 | 0 | 0 | 1.65 | 1.69 | ||||||
Income tax expense (in dollars per share) | (0.01) | 0 | 0 | (0.45) | 0 | (0.46) | (0.09) | ||||
Net income per share - basic (in dollars per share) | 0.17 | 0.44 | 0.31 | 1.51 | (0.95) | 2.43 | 1.36 | ||||
Net (loss) income per share - diluted: | |||||||||||
Net Income from continuing operations (in dollars per share) | $ 0.11 | $ 0.24 | $ 0.24 | $ (1.54) | 0.14 | 0.44 | 0.30 | 0.19 | (0.95) | 1.07 | 1 |
Net Income from discontinued operations: Income (in dollars per share) | 0 | 0 | 0 | 0.12 | 0.12 | ||||||
Gain on sale (in dollars per share) | 0.03 | 0 | 0 | 1.66 | 1.69 | ||||||
Income tax expense (in dollars per share) | (0.01) | 0 | 0 | (0.45) | 0 | (0.46) | |||||
Net income per share - diluted (in dollars per share) | $ 0.16 | $ 0.44 | $ 0.30 | $ 1.52 | $ (0.95) | $ 2.42 | $ 1.35 | ||||
Weighted-average shares outstanding: | |||||||||||
Basic (in shares) | 10,812,000 | 10,791,000 | 10,759,000 | 10,712,000 | 10,501,000 | 10,492,000 | 10,472,000 | 10,429,000 | 10,766,000 | 10,427,000 | 10,367,000 |
Diluted (in shares) | 10,823,000 | 10,803,000 | 10,770,000 | 10,712,000 | 10,544,000 | 10,533,000 | 10,514,000 | 10,485,000 | 10,766,000 | 10,473,000 | 10,417,000 |
SUBSEQUENT EVENTS (Details Text
SUBSEQUENT EVENTS (Details Textual) - $ / shares | 12 Months Ended | ||
Feb. 08, 2024 | Dec. 31, 2023 | Jan. 01, 2023 | |
Subsequent Event [Line Items] | |||
Cash dividends declared per common share (in dollars per share) | $ 0.60 | $ 0.60 | |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Cash dividends declared per common share (in dollars per share) | $ 0.15 |
Uncategorized Items - bgsf-2023
Label | Element | Value |
Horn Solutions, Inc. [Member] | ||
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | 254,000 |