What changed in this filing

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Item 1. Financial Statements

2023-05-15 compared with 2023-02-14 · 90 added, 81 removed, 243 unchanged (41% of the section changed)

27 unchanged sentences

authorized - 200,000 shares;

outstanding - 114,450 shares at December 31, 2022 and September 30, 2022

issued and outstanding - 114,450 shares at March 31, 2023 and September 30, 2022

Accumulated deficit

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(Amounts in thousands except per share data)

(Amounts in thousands, except basic and diluted earnings per share)

Three Months Ended

Six Months Ended

NET REVENUES:

6 unchanged sentences

Goodwill impairment charge

INCOME (LOSS) FROM OPERATIONS

INCOME FROM OPERATIONS

Gain on extinguishment of debt

14 unchanged sentences

Balance, December 31, 2022

Share-based compensation

Balance, March 31, 2023

Shareholders'

2 unchanged sentences

Balance, December 31, 2021

Share-based compensation

Balance, March 31, 2022

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

2 unchanged sentences

(Amounts in thousands)

Three Months Ended

Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Adjustments to reconcile net income to cash (used in) provided by operating activities:

Adjustments to reconcile net income to cash provided by operating activities:

Gain on extinguishment of debt

2 unchanged sentences

Goodwill impairment charge

Stock compensation expense

Share-based compensation

Increase (decrease) in allowance for doubtful accounts

1 unchanged sentence

Amortization of debt discount

Paid in kind interest on term loan

Changes in operating assets and liabilities:

3 unchanged sentences

Other liabilities

Net cash (used in) provided by operating activities

Net cash provided by operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

2 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES:

Payments on finance leases

Net cash used in financing activities

4 unchanged sentences

Cash paid for interest

Cash paid for taxes

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

G EE GROUP INC.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

4 unchanged sentences

In the opinion of management, all adjustments considered necessary for a fair presentation have been included.

Operating results for the three-month period ended December 31, 2022 are not necessarily indicative of the results that may be expected for the year ending September 30, 2023.

Operating results for the six-month period ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending September 30, 2023.

The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended September 30, 2022 as filed on December 20, 2022.

3 unchanged sentences

The Company’s guarantee periods for permanently placed employees generally range from 60 to 90 days from the date of hire.

Falloffs and refunds during the period are reflected in the unaudited condensed consolidated statements of operations as a reduction of placement service revenues and were approximately $ 165 and $ 694 for the three months ended December 31, 2022 and 2021, respectively.

Falloffs and refunds during the period are reflected in the unaudited condensed consolidated statements of operations as a reduction of placement service revenues and were approximately $ 269 and $ 803 for the three-month periods and $ 433 and $ 1,497 for the six-month periods ended March 31, 2023 and 2022, respectively.

Expected future falloffs and refunds are estimated and reflected in the consolidated balance sheet as a reduction of accounts receivable as described below.

An allowance for doubtful accounts is recorded as a charge to bad debt expense where collection is considered to be doubtful due to credit issues.

An allowance for doubtful accounts is recorded as a charge to bad debt expense when collection is considered to be doubtful due to credit issues.

The Company charges off uncollectible accounts against the allowance once the invoices are deemed unlikely to be collectible.

An allowance for placement falloffs also is recorded as a reduction of revenues for estimated losses due to applicants not remaining employed for the Company’s guarantee period.

As of December 31, 2022 and September 30, 2022 the allowance for doubtful accounts and falloffs was $ 731 and $ 738 , respectively.

The allowance includes $ 575 and $ 548 for doubtful accounts and $ 156 and $ 190 for falloffs as of December 31, 2022 and September 30, 2022, respectively.

The combined allowance for doubtful accounts and falloffs were $ 702 and $ 738 as of March 31, 2023 and September 30, 2022, respectively.

The allowance consists of $ 581 and $ 548 for doubtful accounts and $ 121 and $ 190 for falloffs as of March 31, 2023 and September 30, 2022, respectively.

Advertising Expenses

The Company expenses the costs of print and internet media advertising and promotions as incurred and reports these costs in selling, general and administrative expenses.

For the three months ended December 31, 2022 and 2021, advertising expense totaled $ 581 and $ 518 , respectively.

Advertising expenses totaled $ 561 and $ 484 for the three-month periods and $ 1,142 and $ 1,001 for the six-month periods ended March 31, 2023 and 2022, respectively.

Earnings per Share

3 unchanged sentences

The dilutive effect of the common stock equivalents is reflected in earnings per share by use of the treasury stock method.

For the three-month periods ended December 31, 2022 and 2021, the weighted average dilutive incremental shares, or common stock equivalents, included in the calculations of dilutive shares were 816 and 1,442 , respectively.

Common stock equivalents, which are excluded because their effect is anti-dilutive, were approximately 3,373 and 1,748 for the three months ended December 31, 2022 and 2021, respectively.

G EE GROUP INC.

The weighted average dilutive incremental shares, or common stock equivalents, included in the calculations of dilutive shares were 735 and 1,542 for the three-month periods and 776 and 1,492 for the six-month periods ended March 31, 2023 and 2022, respectively.

Common stock equivalents excluded because their effect is anti-dilutive were 3,543 and 1,639 for the three-month periods and 3,458 and 1,693 for the six-month periods ended March 31, 2023 and 2022, respectively.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

11 unchanged sentences

Supplemental cash flow information related to finance leases consisted of the following:

Three Months Ended

Six Months Ended March 31,

Cash paid for finance lease liabilities

4 unchanged sentences

Weighted average discount rate for finance leases

The table below reconciles the undiscounted future minimum lease payments under non-cancelable finance lease agreements to the total finance lease liabilities recognized on the unaudited condensed consolidated balance sheets, included in other current liabilities and other long-term liabilities, as of December 31, 2022:

Remainder of Fiscal 2023

6 unchanged sentences

The Company’s leases generally provide for payment of basic rent plus a share of building real estate taxes, maintenance costs and utilities.

Operating lease expenses were $ 588 and $ 534 for the three-month periods ended December 31, 2022 and 2021, respectively.

G EE GROUP INC.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Amounts in thousands except per share data, unless otherwise stated)

Supplemental cash flow information related to operating leases consisted of the following:

Three Months Ended December 31,

Operating lease expenses were $ 554 and $ 543 for the three-month periods and $ 1,142 and $ 1,077 for the six-month periods ended March 31, 2023 and 2022, respectively.

Supplemental cash flow information related to leases consisted of the following:

Six Months Ended March 31,

Cash paid for operating lease liabilities

Right-of-use assets obtained in exchange for new operating lease liabilities

Supplemental balance sheet information related to operating leases consisted of the following:

Supplemental balance sheet information related to leases consisted of the following:

September 30,

1 unchanged sentence

Weighted average discount rate for operating leases

The table below reconciles the undiscounted future minimum lease payments under non-cancelable lease agreements having initial terms in excess of one year to the total operating lease liabilities recognized on the unaudited condensed consolidated balance sheet as of December 31, 2022, including certain closed offices are as follows:

The table below reconciles the undiscounted future minimum lease payments under non-cancelable lease agreements having initial terms in excess of one year to the total operating lease liabilities recognized on the unaudited condensed consolidated balance sheet as of March 31, 2023, including certain closed offices are as follows:

Remainder of Fiscal 2023

4 unchanged sentences

The Company completed its most recent annual goodwill impairment assessment, as of September 30, 2022, and determined that its goodwill was not impaired.

Prior to this, as of December 31, 2021, an assessment showed the amount of discount inherent in the Company’s market capitalization as reported on the NYSE American exchange when compared with consolidated stockholders’ equity, or net book value, had increased since the annual goodwill impairment assessment as of September 30, 2021;

therefore, the Company performed an interim assessment of its goodwill for impairment.

The estimated fair values of its Professional Services and Industrial Services reporting units were adjusted based on qualitative and quantitative analysis so that they reconcile more precisely with the Company’s market capitalization as of December 31, 2021, plus an assumed control premium.

As a result, the Company recognized a non-cash impairment charge of $ 2,150 during the three months ended December 31, 2021.

No impairment was recorded during the three months ended December 31, 2022.

G EE GROUP INC.

As of March 31, 2023, the amount of discount inherent in the Company’s market capitalization as reported on the NYSE American exchange when compared with consolidated stockholders’ equity, or net book value, had increased since the Company’s most recent annual goodwill impairment assessment indicating a possible triggering event.

In response, the Company performed an interim goodwill impairment assessment as of March 31, 2023.

As a result of this interim assessment, it was determined that no goodwill impairment was present as of March 31, 2023.

As previously disclosed, the Company incurred a goodwill impairment charge in the amount of $ 2,150 during the six months ended March 31, 2022.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

1 unchanged sentence

Intangible Assets

The following tables set forth the costs, accumulated amortization and net book value of the Company’s separately identifiable intangible assets as of December 31, 2022 and September 30, 2022 and estimated future amortization expense.

December 31, 2022

The following tables set forth the costs, accumulated amortization, and net book value of the Company’s separately identifiable intangible assets as of March 31, 2023 and September 30, 2022 and estimated future amortization expense.

March 31, 2023

September 30, 2022

11 unchanged sentences

The CIT Facility matures on the fifth anniversary of the closing date (May 14, 2026).

As of December 31, 2022, the Company had no outstanding borrowings and $ 13,029 available for borrowing under the terms of the CIT Facility.

The Company also had $ 522 in unamortized debt issue cost associated with the CIT Facility.

The amortization expense of these debt costs totaled $ 38 for both the three months ended December 31, 2022 and 2021.

As of March 31, 2023, the Company had no outstanding borrowings and $ 13,347 available for borrowing under the terms of the CIT Facility.

The Company also had $ 484 in unamortized debt issuance costs associated with the CIT Facility.

The amortization expense of these debt costs totaled $ 38 for the three-month periods and $ 76 for the six-month periods ended March 31, 2023 and 2022.

Under the CIT Facility, advances will be subject to a borrowing base formula that is computed based on 85% of eligible accounts receivable of the Company and subsidiaries as defined in the CIT Facility, and subject to certain other criteria, conditions, and applicable reserves, including any additional eligibility requirements as determined by the administrative agent.

5 unchanged sentences

In addition to interest costs on advances outstanding, the CIT Facility will provide for an unused line fee ranging from 0.375 % to 0.50 % depending on the amount of undrawn credit, original issue discount and certain fees for diligence, implementation, and administration.

The unused line fees incurred and included in interest expense totaled $ 26 for both the three months ended December 31, 2022 and 2021.

The unused line fees incurred and included in interest expense totaled $ 25 for both the three-month periods and $ 51 for both the six-month periods ended March 31, 2023 and 2022, respectively.

Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) Payroll Protection Program Loans

1 unchanged sentence

The PPP loans were used primarily to restore employee pay-cuts, recall furloughed or laid-off employees, support the payroll costs for existing employees, hire new employees, and for other allowable purposes including interest costs on certain business mortgage obligations, rent and utilities.

Each of the Company’s subsidiaries executed a separate promissory note evidencing unsecured loans under the PPP.

G EE GROUP INC.

The Company and its operating subsidiaries were granted forgiveness of their respective PPP loans by the SBA during fiscals 2021 and 2022.

The Company’s remaining PPP loans and interest were forgiven in December 2021 and corresponding gains in the aggregate amount of $ 16,773 were recognized during the six months ended March 31, 2022.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Amounts in thousands except per share data, unless otherwise stated)

The Company and its operating subsidiaries have been granted forgiveness of their respective PPP loans by the SBA.

During fiscal 2021, the PPP loans and interest were forgiven for Access Data Consulting Corporation, Agile Resources, Inc., Scribe Solutions Inc., Triad Logistics, Inc., and Triad Personnel Services, Inc., in the amounts of $ 1,470 , $ 1,220 , $ 279 , $ 79 , and $ 408 , respectively, which were recognized as aggregate gains at that time.

The Company’s remaining four PPP loans and interest for GEE Group Inc., BMCH, Inc., Paladin Consulting, Inc., and SNI Companies, Inc.

were forgiven in December 2021 in the amounts of $ 2,024 , $ 2,630 , $ 1,956 , and $ 10,163 , respectively.

As a result, the Company recognized aggregate gains of $ 16,773 during the three months ended December 31, 2021.

The former PPP loans obtained by GEE Group Inc., and its operating subsidiaries together as an affiliated group, exceeded the $ 2,000 audit threshold established by the SBA, and therefore, will be subject to audit by the SBA in the future.

3 unchanged sentences

Amended and Restated 2013 Incentive Stock Plan, as amended

As of December 31, 2022, there were shares of restricted stock and stock options outstanding under the Company’s Amended and Restated 2013 Incentive Stock Plan, as amended (“Incentive Stock Plan”).

During fiscal 2021, the Incentive Stock Plan was amended to increase the total shares available for restricted stock and stock options grants by 10,000 to a total of 15,000 ( 7,500 restricted stock shares and 7,500 stock option shares).

As of March 31, 2023, there were vested and unvested shares of restricted stock and stock options outstanding under the Company’s Amended and Restated 2013 Incentive Stock Plan, as amended (“Incentive Stock Plan”).

During fiscal 2021, the Incentive Stock Plan was amended to increase the total shares available for restricted stock and stock options by 10,000 to a total of 15,000 ( 7,500 restricted stock shares and 7,500 stock option shares).

The Incentive Stock Plan authorizes the Compensation Committee of the Board of Directors to grant either incentive or non-statutory stock options to employees.

Vesting periods are established by the Compensation Committee at the time of grant.

As of December 31, 2022, there were 8,760 shares available to be granted under the Plan ( 4,098 shares available for restricted stock grants and 4,662 shares available for stock option grants).

As of March 31, 2023, there were 8,815 shares available to be granted under the Plan ( 4,098 shares available for restricted stock grants and 4,717 shares available for stock option grants).

Restricted Stock

The Company granted 760 shares of restricted stock during the three months ended December 31, 2022.

The Company granted 760 shares of restricted stock during the six months ended March 31, 2023.

On September 27, 2022, the Company adopted a new annual incentive compensation program (“AICP”) for its executives to be administered under the Company’s Incentive Stock Plan.

2 unchanged sentences

Initial awards under both service-only and service plus performance-based components of the AICP LTI plan are determined based on financial performance measures for the immediately preceding fiscal year.

During the three months ended December 31, 2022, 551 of the 760 restricted shares were granted based on actual results for fiscal 2022, as measured against corresponding financial targets for that year, and will cliff vest as of December 2, 2025.

During the six months ended March 31, 2023, 551 of the 760 restricted shares were granted based on actual results for fiscal 2022, as measured against corresponding financial targets for that year, and will cliff vest as of December 2, 2025.

The remaining 209 of the 760 restricted shares were also granted based on fiscal 2022 results, and as further adjusted for the probable outcome with regard to the financial targets set by the Company’s board of directors for fiscal 2023.

1 unchanged sentence

The final number of fiscal 2022 service plus performance-based restricted shares granted will be determined once the actual financial performance of the Company is determined for fiscal 2023, and will cliff vest on December 2, 2025, the third anniversary from their date of grant.

G EE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Amounts in thousands except per share data, unless otherwise stated)

Under the AICP LTI plan, the service plus performance-based grants of 209 restricted shares during the three-month period ended December 31, 2022, represent the first tranche of a three-year schedule of awards.

Under the AICP LTI plan, the service plus performance-based grants of 209 restricted shares during the six months ended March 31, 2023, represent the first tranche of a three-year schedule of awards.

The next two tranches of up to 262 shares each (up to an additional 524 restricted shares in total) are scheduled to become effective as the Company’s financial plans and targets are set by the board of directors prior to each anniversary date for each of the two subsequent fiscal years, respectively.

As the vesting of the two subsequent tranches will be based in part on performance conditions that have not yet been determined, the grant dates and fair values of these scheduled awards will be established in the future.

The end of the requisite service periods for the entire 760 restricted shares granted during the three months ended December 30, 2022, plus the additional 524 restricted shares eligible to be granted in the future, once the performance conditions are determined for fiscal 2024 and fiscal 2025, is December 2, 2025.

The end of the requisite service periods for the entire 760 restricted shares granted during the six months ended March 31, 2023, plus the additional 524 restricted shares eligible to be granted in the future, once the performance conditions are determined for fiscal 2024 and fiscal 2025, is December 2, 2025.

Therefore, the remaining two tranches of the fiscal 2022 service plus performance-based awards may be expected to have grant dates corresponding with the establishment of the fiscal 2024 and fiscal 2025 financial performance targets by the Company’s board of directors.

However, all final shares determined for each of the two subsequent annual tranches also will cliff vest on December 2, 2025.

Share-based compensation expense attributable to restricted stock was $ 87 and $ 72 during the three months ended December 31, 2022 and 2021, respectively.

As of December 31, 2022, there was approximately $ 882 of unrecognized compensation expense related to restricted stock outstanding and the weighted average vesting period for those grants was 3.05 years.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Amounts in thousands except per share data, unless otherwise stated)

Share-based compensation expense attributable to restricted stock was $ 88 and $ 76 for the three-month periods and $ 175 and $ 148 for the six-month periods ended March 31, 2023 and 2022, respectively.

As of March 31, 2023, there was approximately $ 624 of unrecognized compensation expense related to restricted stock outstanding and the weighted average vesting period for those grants was 3.06 years.

Number of Shares

Weighted Average Fair Value ($)

1 unchanged sentence

Non-vested restricted stock outstanding as of December 31, 2022

The Company had 77 warrants outstanding as of December 31, 2022 and September 30, 2022 with a weighted average exercise price per share of $ 2 and a weighted average remaining contractual life of 2.25 and 2.50 , respectively.

No warrants were granted or expired during the three months ended December 31, 2022.

Non-vested restricted stock outstanding as of March 31, 2023

The Company had 77 warrants outstanding as of March 31, 2023 and September 30, 2022 with a weighted average exercise price per share of $ 2 and a weighted average remaining contractual life of 2.01 and 2.50 , respectively.

No warrants were granted or expired during the six months ended March 31, 2023.

Stock Options

All stock options outstanding as of December 31, 2022 and September 30, 2022 were non-statutory stock options, had exercise prices equal to the market price on the date of grant, and had expiration dates ten years from the date of grant.

The Company granted 435 stock options during the three months ended December 31, 2022.

All stock options outstanding as of March 31, 2023 and September 30, 2022 were non-statutory stock options, had exercise prices equal to the market price on the date of grant, and had expiration dates ten years from the date of grant.

The Company granted 435 stock options during the six months ended March 31, 2023.

The stock options generally vest on annual schedules during periods ranging from two to four years, although some options are fully vested upon grant.

Share-based compensation expense attributable to stock options was $ 287 and $ 75 for the three months ended December 31, 2022 and 2021, respectively.

As of December 31, 2022, there was approximately $ 574 of unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 3.70 years.

G EE GROUP INC.

Share-based compensation expense attributable to stock options was $ 38 and $ 76 for the three-month periods and $ 325 and $ 151 for the six-month periods ended March 31, 2023 and 2022, respectively.

As of March 31, 2023, there was approximately $ 510 of unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 3.69 years.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Amounts in thousands except per share data, unless otherwise stated)

A summary of stock option activity is as follows:

Number of Shares

Weighted Average Exercise Price per share ($)

Weighted Average Remaining Contractual Life (Years)

Total Intrinsic Value of

Total Intrinsic Value of Options ($)

Options outstanding as of September 30, 2022

Options outstanding as of December 31, 2022

Options outstanding as of March 31, 2023

Exercisable as of September 30, 2022

Exercisable as of December 31, 2022

The following table presents the provision for income taxes and our effective tax rate for the three-month periods ended December 31, 2022 and 2021:

Exercisable as of March 31, 2023

The following table presents the provision for income taxes and our effective tax rate for the three and six-month periods ended March 31, 2023 and 2022:

Three Months Ended,

Provision for income taxes

Six Months Ended,

Provision (benefit) for income taxes

Effective tax rate

The effective income tax rate on operations is based upon the estimated income for the year and adjustments, if any, in the applicable quarterly periods for the potential tax consequences, benefits, resolutions of tax audits or other tax contingencies.

The effective tax rates for the three months ended December 31, 2022 and 2021 are lower than the statutory rate primarily due to the effect of the change in valuation allowance on the net deferred tax asset (“DTA”) position.

Our effective tax rate for the three and six-month periods ended March 31, 2023 and 2022, is lower than the statutory tax rate primarily due to the effect of the valuation allowance on the net deferred tax asset (“DTA”) position.

Other than the deferred tax liability relating to indefinite lived assets, the Company is maintaining a valuation allowance against the remaining net DTA position.

1 unchanged sentence

Litigation and Claims

The Company and its subsidiaries are involved in various litigation that arises in the ordinary course of business.

There are no pending significant legal proceedings to which the Company is a party for which management believes the ultimate outcome would have a material adverse effect on the Company’s financial position.

G EE GROUP INC.

As previously disclosed, on March 23, 2022, the Company settled the Sands Brothers Venture Capital II, LLC lawsuit.

Under the terms of the agreement and release, neither the plaintiff nor the Company have admitted or conceded to any wrongdoing and the matter was settled in its entirety for a one-time payment to the plaintiff of approximately $ 1,175 , of which the Company’s portion was $ 975 , with insurance paying the balance.

This payment was due and paid by April 8, 2022, and recorded in selling, general, and administrative expenses as a pre-tax charge in the Company’s condensed consolidated financial statements during the three-month period ended March 31, 2022.

The Company and its subsidiaries are involved in various other litigation that arises in the ordinary course of business.

There are no other pending significant legal proceedings to which the Company is a party for which management believes the ultimate outcome would have a material adverse effect on the Company’s financial position.

GEE GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

5 unchanged sentences

Some selling, general and administrative expenses are not fully allocated among Industrial Services and Professional Staffing Services.

Unallocated corporate expenses primarily include certain executive compensation expenses and salaries, certain administrative salaries, corporate legal expenses, share-based compensation expenses, consulting expenses, audit fees, corporate rent and facility costs, board related fees, acquisition, integration and restructuring expenses, and interest expense.

Unallocated corporate expenses primarily include certain executive and administrative salaries and related expenses, corporate legal expenses, share-based compensation expenses, consulting expenses, audit fees, corporate rent and facility costs, board related fees, acquisition, integration and restructuring expenses, and interest expense.

Three Months Ended

Six Months Ended

Industrial Staffing Services

Contract services revenue

Contract services gross margin (1)

Contract services gross margin (a)

Income from operations

2 unchanged sentences

Permanent placement revenue

Placement services gross margin

Permanent placement services gross margin

Contract services revenue

9 unchanged sentences

Total revenue

Income (loss) from operations

Income from operations

Depreciation and amortization

Annual premium refunds from the Ohio Bureau of Workers Compensations totaling $ 18 are included in the three months ended December 31, 2021.

No such refunds were included in the three months ended December 31, 2022.

The Industrial Services gross margin normalized for the effects of these items was approximately 14.8 % for the three months ended December 31, 2021.

(Amounts in thousands except per share data, unless otherwise stated)

Credits related to estimated annual premium refunds from the Ohio Bureau of Workers Compensations totaling $ 2 and $ 19 are included in the three-month periods ended March 31, 2023 and 2022, respectively;

and $ 2 and $ 37 for the six-month periods ended March 31, 2023 and 2022, respectively.

The Industrial Services gross margin normalized for the effects of these items were approximately 16.4 % and 14.2 % for the three-month periods ended March 31, 2023 and 2022, respectively;

and 15.9 % and 14.5 % for the six-month periods ended March 31, 2023 and 2022, respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements