hqi20250630_10q.htm

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2025

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

Commission File Number 001-38513

HIREQUEST, INC.

(Exact name of registrant as specified in its Charter)

Delaware		91-2079472
(State of incorporation or organization)		(I.R.S. employer identification no.)

111 Springhall Drive, Goose Creek, SC 29445
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (843) 723-7400

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

Common Stock, $0.001 par value		HQI		The NASDAQ Stock Market LLC
Title of each class		Trading Symbol(s)		Name of each exchange on which registered

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

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

Indicate by check mark whether the Registrant is a large accelerated filer ☐, an accelerated filer ☐, a non-accelerated filer ☒, a smaller reporting company ☒, or an emerging growth company ☐ (as defined in Rule 12b-2 of the Exchange Act).

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

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of issuer's common stock outstanding at August 6, 2025: 14.1 million

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HireQuest, Inc.

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations	4
	Consolidated Statements of Changes in Stockholders' Equity	5
	Consolidated Statements of Cash Flows	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	29
Item 4.	Controls and Procedures	29

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 5.	Other Information	30
Item 6.	Exhibits	30
	Signatures	31

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

HireQuest, Inc.

Consolidated Balance Sheets

(unaudited)

(in thousands, except share and par value data)	*June 30, 2025*			*December 31, 2024*
ASSETS
Current assets
Cash	$	2,675		$	2,219
Accounts receivable, net of allowance of $321 and $275		42,785			42,348
Notes receivable		1,459			1,166
Prepaid expenses, deposits, and other assets		3,530			2,413
Prepaid workers' compensation		1,369			1,094
Total current assets		51,818			49,240
Property and equipment, net		4,105			4,149
Workers’ compensation claims payment deposit		1,252			1,127
Franchise agreements, net		18,885			19,737
Other intangible assets, net		7,901			8,442
Goodwill		1,633			1,633
Deferred tax asset		1,784			2,073
Other assets		43			57
Notes receivable, net of current portion and allowance of $876 thousand and $773 thousand, respectively		6,003			6,664
Intangible asset held for sale - discontinued operations		891			891
Total assets	$	94,315		$	94,013
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	271		$	174
Line of credit		4,333			6,829
Term loan payable		-			88
Other current liabilities		1,977			2,018
Accrued payroll, benefits, and payroll taxes		3,092			2,557
Due to franchisees		8,253			7,579
Risk management incentive program liability		1,947			1,252
Workers' compensation claims liability		3,383			3,599
Total current liabilities		23,256			24,096
Workers' compensation claims liability, net of current portion		2,656			2,707
Franchisee deposits		2,381			2,406
Total liabilities		28,293			29,209
Commitments and contingencies (Note 11)
Stockholders' equity
Preferred stock - $0.001 par value, 1,000,000 shares authorized; none issued		-			-
Common stock - $0.001 par value, 30,000,000 shares authorized; 14,104,324 and 14,072,804 shares issued, respectively		14			14
Additional paid-in capital		36,765			36,286
Treasury stock, at cost - 48,849 shares		(146	)		(146	)
Retained earnings		29,389			28,650
Total stockholders' equity		66,022			64,804
Total liabilities and stockholders' equity	$	94,315		$	94,013

See accompanying notes to consolidated financial statements.

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HireQuest, Inc.

Consolidated Statements of Operations

(unaudited)

	*Three months ended*						*Six months ended*
(in thousands, except per share data)	*June 30, 2025*			*June 30, 2024*			*June 30, 2025*			*June 30, 2024*
Franchise royalties	$	7,284		$	8,201		$	14,245		$	16,041
Service revenue		354			479			866			1,058
Total revenue		7,638			8,680			15,111			17,099
Selling, general and administrative expenses		5,861			5,288			11,117			10,907
Depreciation and amortization		734			697			1,469			1,395
Income from operations		1,043			2,695			2,525			4,797
Other miscellaneous income		28			39			159			76
Interest income		129			151			262			287
Interest and other financing expense		(71	)		(253	)		(214	)		(495	)
Net income before income taxes		1,129			2,632			2,732			4,665
Provision for income taxes		56			557			224			897
Net income from continuing operations		1,073			2,075			2,508			3,768
Loss from discontinued operations, net of tax		(13	)		(36	)		(85	)		(110	)
Net income	$	1,060		$	2,039		$	2,423		$	3,658

Basic earnings (loss) per share
Continuing operations	$	0.08		$	0.15		$	0.18		$	0.27
Discontinued operations		-			-			(0.01	)		(0.01	)
Total	$	0.08		$	0.15		$	0.17		$	0.26

Diluted earnings (loss) per share
Continuing operations	$	0.08		$	0.15		$	0.18		$	0.27
Discontinued operations		-			-			(0.01	)		(0.01	)
Total	$	0.08		$	0.15		$	0.17		$	0.26

Weighted average shares outstanding
Basic		13,938			13,818			13,932			13,809
Diluted		13,990			13,886			14,001			13,889

See accompanying notes to consolidated financial statements.

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HireQuest, Inc.

Consolidated Statements of Changes in Stockholders’ Equity

(unaudited)

	*Common stock*
*Six months ended (in thousands except per share data)*	*Shares*		*Par value*		*Treasury Stock amount*			*Additional paid-in capital*		*Retained earnings*			*Total stockholders' equity*
Balance at December 31, 2024		14,073	$	14	$	(146	)	$	36,286	$	28,650		$	64,804
Stock based compensation		-		-		-			479		-			479
Common stock dividends ($0.12 per share)		-		-		-			-		(1,684	)		(1,684	)
Restricted common stock granted		31		-		-			-		-			-
Net income		-		-		-			-		2,423			2,423
Balance at June 30, 2025		14,104	$	14	$	(146	)	$	36,765	$	29,389		$	66,022

Balance at December 31, 2023		13,997	$	14	$	(146	)	$	34,527	$	28,337		$	62,732
Stock based compensation		-		-		-			700		-			700
Common stock dividends ($0.12 per share)		-		-		-			-		(1,676	)		(1,676	)
Restricted common stock granted		16		-		-			-		-			-
Net income		-		-		-			-		3,658			3,658
Balance at June 30, 2024		14,013	$	14	$	(146	)	$	35,227	$	30,319		$	65,414

*Three months ended*
Balance at March 31, 2025		14,077	$	14	$	(146	)	$	36,525	$	29,171		$	65,564
Stock based compensation		-		-		-			240		-			240
Common stock dividends ($0.06 per share)		-		-		-			-		(842	)		(842	)
Restricted common stock granted		27		-		-			-		-			-
Net loss		-		-		-			-		1,060			1,060
Balance at June 30, 2025		14,104	$	14	$	(146	)	$	36,765	$	29,389		$	66,022

Balance at March 31, 2024		14,002	$	14	$	(146	)	$	34,889	$	29,118		$	63,875
Stock based compensation		-		-		-			338		-			338
Common stock dividends ($0.06 per share)		-		-		-			-		(838	)		(838	)
Restricted common stock granted		11		-		-			-		-			-
Net income		-		-		-			-		2,039			2,039
Balance at June 30, 2024		14,013	$	14	$	(146	)	$	35,227	$	30,319		$	65,414

See accompanying notes to consolidated financial statements.

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HireQuest, Inc.

Consolidated Statements of Cash Flows

(unaudited)

	*Six months ended*
(in thousands)	*June 30, 2025*			*June 30, 2024*
Cash flows from operating activities
Net income	$	2,423		$	3,658
Loss from discontinued operations		85			110
Net income from continuing operations		2,508			3,768
Adjustments to reconcile net income to net cash provided by (used in) operations:
Depreciation and amortization		1,469			1,395
Non-cash interest		9			11
Provision for credit losses		150			217
Stock based compensation		479			700
Deferred taxes		289			(1	)
(Gain) loss on disposition of intangible assets		(103	)		11
Changes in operating assets and liabilities:
Accounts receivable		(484	)		(5,650	)
Prepaid expenses, deposits, and other assets		(1,114	)		(360	)
Prepaid workers' compensation		(275	)		(984	)
Accounts payable		96			113
Risk management incentive program liability		695			258
Other current liabilities		(41	)		(555	)
Accrued payroll, benefits and payroll taxes		535			(691	)
Due to franchisees		675			744
Workers' compensation claim payment deposit		(125	)		341
Workers' compensation claims liability		(267	)		14
Net cash provided by (used in) operating activities - continuing operations		4,496			(669	)
Net cash used in operating activities - discontinued operations		(85	)		(110	)
Net cash provided by (used in) operating activities		4,411			(779	)

SEC Form 10-Q filed by HireQuest Inc.