prft-20210331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended March 31, 2021


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

For the transition period from to

Commission file number: 001-15169

PERFICIENT, INC.

(Exact name of registrant as specified in its charter)

Delaware

No.

74-2853258

(State or other jurisdiction of incorporation or organization)

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

555 Maryville University Drive

Suite 600

Saint Louis, Missouri 63141

(Address of principal executive offices)

(314) 529-3600

(Registrant’s telephone number, including area code)

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value	PRFT	The Nasdaq Global Select Market

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 during the past 90 days. þ Yes o 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). þ Yes o No

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


Large accelerated filer	þ	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

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

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

As of April 22, 2021, there were 33,046,807 shares of Common Stock outstanding.

TABLE OF CONTENTS


Part I.	Financial Information	1

Item 1.	Financial Statements	2

	Condensed Consolidated Balance Sheets as of March 3 1, 2021 (unaudited) and December 31, 20 20	2

	Unaudited Condensed Consolidated Statements of Operations for the Three Months Ended March 3 1 , 202 1 and 2020	3

	Unaudited Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31. 2021 and 2020	4

	Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 3 1 , 2021 and 2020	5

	Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 3 1 , 2021 and 2020	6

	Notes to Interim Unaudited Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	28

Item 4.	Controls and Procedures	29

Part II.	Other Information	29

Item 1A.	Risk Factors	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 5.	Other Information	30

Item 6.	Exhibits	31

	Signatures	32

PART I. FINANCIAL INFORMATION

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report on this Form 10-Q (“Form 10-Q”) are not purely historical statements and discuss future expectations, contain projections of results of operations or financial condition, or state other forward-looking information. Those statements are subject to known and unknown risks, uncertainties, and other factors that could cause the actual results to differ materially from those contemplated by the statements. The “forward-looking” information is based on various factors and was derived using numerous assumptions. In some cases, you can identify these so-called forward-looking statements by words like “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of those words and other comparable words. You should be aware that those statements only reflect our predictions and are subject to risks and uncertainties. Actual events or results may differ substantially. Important factors that could cause our actual results to be materially different from the forward-looking statements include (but are not limited to) the following, many of which are, or may be, amplified by the novel coronavirus (COVID-19) pandemic:

1.the impact of the general economy and economic and political uncertainty on our business;

2.the impact of the COVID-19 pandemic on our business;

3.risks associated with potential changes to federal, state, local and foreign laws, regulations, and policies;

4.risks associated with the operation of our business generally, including:

a.client demand for our services and solutions;

b.effectively competing in a highly competitive market;

c.risks from international operations including fluctuations in exchange rates;

d.adapting to changes in technologies and offerings;

e.obtaining favorable pricing to reflect services provided;

f.risk of loss of one or more significant software vendors;

g.maintaining a balance of our supply of skills and resources with client demand;

h.changes to immigration policies;

i.protecting our clients’ and our data and information;

j.changes to tax levels, audits, investigations, tax laws or their interpretation;

k.making appropriate estimates and assumptions in connection with preparing our consolidated financial statements; and

l.maintaining effective internal controls;

5.risks associated with managing growth organically and through acquisitions;

6.risks associated with servicing our debt, the potential impact on the value of our common stock from the conditional conversion features of our debt and the associated convertible note hedge transactions;

7.legal liabilities, including intellectual property protection and infringement or the disclosure of personally identifiable information; and

8.the risks detailed from time to time within our filings with the Securities and Exchange Commission (the “SEC”).

This discussion is not exhaustive, but is designed to highlight important factors that may impact our forward-looking statements. Because the factors referred to above, as well as the statements included under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2020, including documents incorporated by reference therein and herein, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement made by us or on our behalf, you should not place undue reliance on any forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We are under no duty to update any of the forward-looking statements after the date of this Form 10-Q to conform such statements to actual results.

All forward-looking statements, express or implied, included in this report and the documents we incorporate by reference that are attributable to Perficient, Inc. and its subsidiaries (collectively, “we,” “us,” “Perficient,” or the “Company”) are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that the Company or any persons acting on our behalf may issue.

Item 1. Financial Statements

Perficient, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share information)


	March 31, 2021 (unaudited)		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	72,058	$	83,204
Accounts receivable, net	138,836		133,085
Prepaid expenses	6,468		5,575
Other current assets	4,688		4,646
Total current assets	222,050		226,510
Property and equipment, net	11,717		11,902
Operating lease right-of-use assets	37,195		38,539
Goodwill	421,927		427,928
Intangible assets, net	55,368		63,571
Other non-current assets	19,253		17,311
Total assets	$	767,510	$	785,761

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	16,150	$	25,613
Other current liabilities	87,373		103,267
Total current liabilities	103,523		128,880
Long-term debt, net	186,135		183,624
Operating lease liabilities	27,937		29,098
Other non-current liabilities	51,381		50,081
Total liabilities	$	368,976	$	391,683
Stockholders’ equity:
Preferred stock (par value $0.001 per share; 8,000,000 authorized; no shares issued or outstanding as of March 31, 2021 and December 31, 2020)	$	—	$	—
Common stock (par value $0.001 per share; 100,000,000 authorized; 50,552,959 shares issued and 32,151,470 shares outstanding as of March 31, 2021; 50,296,453 shares issued and 32,074,094 shares outstanding as of December 31, 2020)	51		50
Additional paid-in capital	465,156		459,866
Accumulated other comprehensive (loss) income	(540)		3,746
Treasury stock, at cost (18,401,489 shares as of March 31, 2021; 18,222,359 shares as of December 31, 2020)	(299,367)		(289,225)
Retained earnings	233,234		219,641
Total stockholders’ equity	398,534		394,078
Total liabilities and stockholders’ equity	$	767,510	$	785,761

See accompanying notes to interim unaudited condensed consolidated financial statements.

Perficient, Inc.

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share information)


	Three Months Ended March 31,
	2021		2020

Revenues	$	169,341	$	145,562


Cost of revenues (cost of services, exclusive of depreciation and amortization, shown separately below)	106,062		93,217
Selling, general and administrative	33,979		33,221
Depreciation	1,460		1,288
Amortization	7,052		3,922
Acquisition costs	68		1,813
Adjustment to fair value of contingent consideration	514		(335)
Income from operations	20,206		12,436

Net interest expense	3,296		1,926
Net other expense	122		7
Income before income taxes	16,788		10,503
Provision for income taxes	3,195		1,529

Net income	$	13,593	$	8,974

Basic net income per share	$	0.43	$	0.28
Diluted net income per share	$	0.41	$	0.27
Shares used in computing basic net income per share	31,864		31,637
Shares used in computing diluted net income per share	33,015		32,876

See accompanying notes to interim unaudited condensed consolidated financial statements.

Perficient, Inc.

Unaudited Condensed Consolidated Statements of Comprehensive Income

(in thousands)


	Three Months Ended March 31,
	2021		2020

Net income	$	13,593	$	8,974
Other comprehensive (loss) income:
Foreign currency translation adjustment, net of tax	(4,286)		(974)
Comprehensive income	$	9,307	$	8,000

See accompanying notes to interim unaudited condensed consolidated financial statements.

Perficient, Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)


		Three Months Ended March 31,
		2021		2020


Common Stock
Beginning of period		$	50	$	49
	Stock compensation related to restricted stock vesting and retirement savings plan contributions	1		1
End of period

SEC Form 10-Q filed by Perficient, Inc.