Star Equity Holdings, Inc. (Nasdaq: STRR; STRRP) (“Star Equity” or
the “Company”), a diversified holding company, provided today an
update on key achievements in 2021 as well as its sales pipeline
and acquisitions initiatives for 2022.
Healthcare:The Healthcare division’s Diagnostic
Imaging business sold a record 39 cameras in 2021 compared to 16 in
2020 and 31 in 2019. With the Healthcare division as a whole having
rebounded to more normal levels, the Company has begun to consider
potential bolt on acquisition targets for the division,
particularly in the area of healthcare staffing. Although there can
be no certainty of a transaction occurring, the Company believes
healthcare staffing is a natural addition to its existing
Healthcare businesses and is eager to explore synergies with
Digirad Health’s current distribution channels, client base, and
support for its own internal healthcare staffing needs.
Furthermore, Rick Coleman, Star Equity’s recently appointed Chief
Operating Officer, has substantial experience and success in the
staffing industry, most recently as CEO of Command Center, Inc.,
which merged with HireQuest, Inc. (Nasdaq: HQI) in 2019.
Construction:The Company’s Construction division
also saw improved results in both of its businesses: KBS Builders,
Inc. (“KBS”) based in New England and EdgeBuilder/Glenbrook
(“EBGL”) based in Minnesota. KBS produced approximately 350 modular
units in 2021 compared to 280 units in 2020 and 230 units in 2019.
The Company believes production capacity at KBS’s South Paris, ME
plant is approximately 500 modules per year and is working
diligently to attain this production level. The Company has a goal
of reopening its idle Oxford, ME plant, which would increase KBS’s
total production capacity to 750-1,000 modules per year. In
addition, KBS’s sales pipeline, which represents potential projects
that could be won over the next 12 months, is approximately $65
million. A highlight of the sales pipeline is an $8 million-$9
million project to produce four new dormitories for a college in
New England. This project, if won, would be one of the largest
contracts in KBS’s history and mark KBS’s expansion into the
student housing segment. Booked backlog at KBS is currently $7
million. EBGL delivered strong top line growth as a result of
improved utilization and pricing and generated a strong rebound in
profitability in the second half of 2021. Booked backlog at EBGL is
currently $15 million.
“We are highly encouraged with the revenue
growth at our Construction division in 2021,” said Jeff Eberwein,
Star Equity’s Executive Chairman. “We are confident in the growth
outlook for our Construction division in 2022 and expect
profitability to improve significantly. At the same time, we are
evaluating bolt on acquisition opportunities for both Healthcare
and Construction in addition to exploring entry into new business
sectors.”
The Company will provide additional financial
and operating results in its complete fourth quarter and full-year
2021 earnings press release and conference call that will be
announced at a later date.
About Star Equity Holdings,
Inc.
Star Equity Holdings, Inc. is a diversified
holding company with three divisions: Healthcare, Construction, and
Investments.
Healthcare
Our Healthcare division designs, manufactures,
and distributes diagnostic medical imaging products and provides
mobile imaging services. Our Healthcare division operates in two
businesses: (i) diagnostic services and (i) diagnostic
imaging. The diagnostic services business offers imaging services
to healthcare providers as an outsourced alternative to purchasing
and operating their own equipment. The diagnostic imaging business
develops, sells, and maintains solid-state gamma cameras.
Construction
Our Construction division manufactures modular
housing units for commercial and residential real estate projects
and operates in two businesses: (i) modular building manufacturing
and (ii) structural wall panel and wood foundation manufacturing,
including building supply distribution operations for professional
builders.
Investments
Our Investments division manages and finances
the Company’s real estate assets and investments.
Forward-Looking Statements
“Safe Harbor” Statement under the Private
Securities Litigation Reform Act of 1995: This release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements in this
release that are not statements of historical fact are hereby
identified as “forward-looking statements” for the purpose of the
safe harbor provided by Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Forward-looking Statements include, without limitation,
statements regarding (i) the plans and objectives of management for
future operations, including plans or objectives relating to
acquisitions and related integration, development of commercially
viable products, novel technologies, and modern applicable
services, (ii) projections of income (including income/loss),
EBITDA, earnings (including earnings/loss) per share, free cash
flow (FCF), capital expenditures, cost reductions, capital
structure or other financial items, (iii) the future financial
performance of the Company or acquisition targets and (iv) the
assumptions underlying or relating to any statement described
above. Moreover, forward-looking statements necessarily involve
assumptions on the Company’s part. These forward-looking statements
generally are identified by the words “believe”, “expect”,
“anticipate”, “estimate”, “project”, “intend”, “plan”, “should”,
“may”, “will”, “would”, “will be”, “will continue” or similar
expressions. Such forward-looking statements are not meant to
predict or guarantee actual results, performance, events, or
circumstances and may not be realized because they are based upon
the Company's current projections, plans, objectives, beliefs,
expectations, estimates and assumptions and are subject to a number
of risks and uncertainties and other influences, many of which the
Company has no control over. Actual results and the timing of
certain events and circumstances may differ materially from those
described above as a result of these risks and uncertainties.
Factors that may influence or contribute to the inaccuracy of
forward-looking statements or cause actual results to differ
materially from expected or desired results may include, without
limitation, the substantial amount of debt of the Company and the
Company’s ability to repay or refinance it or incur additional debt
in the future; the Company’s need for a significant amount of cash
to service and repay the debt and to pay dividends on the Company’s
preferred stock; the restrictions contained in the debt agreements
that limit the discretion of management in operating the business;
legal, regulatory, political and economic risks in markets and
public health crises that reduce economic activity and cause
restrictions on operations (including the recent coronavirus
COVID-19 outbreak); the length of time associated with servicing
customers; losses of significant contracts or failure to get
potential contracts being discussed; disruptions in the
relationship with third party vendors; accounts receivable
turnover; insufficient cash flows and resulting lack of liquidity;
the Company's inability to expand the Company's business;
unfavorable changes in the extensive governmental legislation and
regulations governing healthcare providers and the provision of
healthcare services and the competitive impact of such changes
(including unfavorable changes to reimbursement policies); high
costs of regulatory compliance; the liability and compliance costs
regarding environmental regulations; the underlying condition of
the technology support industry; the lack of product
diversification; development and introduction of new technologies
and intense competition in the healthcare industry; existing or
increased competition; risks to the price and volatility of the
Company’s common stock and preferred stock; stock volatility and in
liquidity; risks to preferred stockholders of not receiving
dividends and risks to the Company’s ability to pursue growth
opportunities if the Company continues to pay dividends according
to the terms of the Company’s preferred stock; the Company’s
ability to execute on its business strategy (including any cost
reduction plans); the Company’s failure to realize expected
benefits of restructuring and cost-cutting actions; the Company’s
ability to preserve and monetize its net operating losses; risks
associated with the Company’s possible pursuit of acquisitions; the
Company’s ability to consummate successful acquisitions and execute
related integration, as well as factors related to the Company’s
business including economic and financial market conditions
generally and economic conditions in the Company’s markets; failure
to keep pace with evolving technologies and difficulties
integrating technologies; system failures; losses of key management
personnel and the inability to attract and retain highly qualified
management and personnel in the future; and the continued demand
for and market acceptance of the Company’s services. For a detailed
discussion of cautionary statements and risks that may affect the
Company’s future results of operations and financial results,
please refer to the Company’s filings with the Securities and
Exchange Commission, including, but not limited to, the risk
factors in the Company’s most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q. This release reflects management’s
views as of the date presented.
All forward-looking statements are necessarily
only estimates of future results, and there can be no assurance
that actual results will not differ materially from expectations,
and, therefore, you are cautioned not to place undue reliance on
such statements. Further, any forward-looking statement speaks only
as of the date on which it is made, and we undertake no obligation
to update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events.
For more information contact: |
|
Star Equity Holdings, Inc. |
The Equity Group |
Jeffrey E. Eberwein |
Lena Cati |
Executive Chairman |
Vice President |
203-489-9501 |
212-836-9611 |
admin@starequity.com |
lcati@equityny.com |
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