NEW YORK - Staffing 360 Solutions, Inc. (NASDAQ:STAF), a staffing company executing a buy-integrate-build strategy, has announced a reverse stock split of its common stock at a ratio of 1-for-10. The adjustment will take effect post-market on Tuesday, with the stock trading on a split-adjusted basis from the market opening on Wednesday, June 26, 2024.
This move follows the authorization granted by the company's stockholders at the annual meeting on December 27, 2023, where they allowed the Board of Directors to implement a reverse stock split with a ratio ranging between 1-for-2 and 1-for-20. The Board has now determined a 1-for-10 ratio.
At the effective time, every ten shares of issued and outstanding common stock will automatically convert into one share. This change will not affect the par value per share or the number of authorized shares. The reverse stock split will uniformly affect all shareholders and will not change any shareholder's percentage interest in the company's equity, except for adjustments due to the rounding up of fractional shares.
The total number of shares of common stock outstanding will decrease from approximately 6.4 million to around 639,739, subject to rounding. Adjustments will also be made to Staffing 360's equity awards, convertible preferred stock, and warrants, as well as their exercise or conversion prices.
Shareholders holding shares through a brokerage account will see their holdings automatically adjusted. Those with certificated shares will not need to exchange their certificates unless they choose to do so. Any questions regarding the reverse stock split can be directed to the company's transfer agent, Securities Transfer Corporation.
Staffing 360 Solutions is involved in acquiring staffing organizations in the United States and is pursuing targets in various staffing sectors. The reverse stock split is part of the company's efforts to maintain compliance with Nasdaq's listing requirements.
This news is based on a press release statement from Staffing 360 Solutions.
In other recent news, Staffing 360 Solutions, Inc. is facing potential delisting from Nasdaq due to non-compliance. The company has failed to file its Annual Report on Form 10-K for the fiscal year ending December 30, 2023, within the required timeframe, leading to a review of its eligibility for continued listing on the Nasdaq Capital Market.
As per Nasdaq's Listing Rule 5250(c)(1), listed companies must submit timely periodic financial reports. The company has until June 17, 2024, to present a plan to regain compliance and explain the reasons for the late filing to the Nasdaq Hearings Panel.
The cause of the delay and the expected date for filing the Annual Report have not been disclosed by the company's management. However, the impact of the COVID-19 pandemic on business operations and economic conditions has been cited in past communications as a factor affecting the company. Staffing 360 Solutions is committed to addressing the filing deficiency and taking necessary actions to maintain its listing status. These are recent developments that investors should take into account.
InvestingPro Insights
As Staffing 360 Solutions, Inc. (NASDAQ:STAF) navigates its strategic reverse stock split to maintain Nasdaq compliance, several financial metrics and market indicators from InvestingPro provide a snapshot of the company's current standing.
With a market capitalization of just $1.95 million, the company is positioned as a micro-cap entity in the staffing industry. Despite a modest revenue growth of 3.24% in the last twelve months as of Q4 2023, Staffing 360's financial health is under scrutiny due to its significant debt burden and potential difficulties in meeting interest payments, as highlighted by InvestingPro Tips.
The company's gross profit margin stands at 14.95%, which may be considered weak relative to industry norms, potentially affecting its ability to generate sufficient earnings to cover operating costs and debt obligations.
Moreover, the company's price has experienced a notable decline over the past year, decreasing by 54.12%, which could be a signal of investor concerns about the company's future prospects. This price volatility is corroborated by an InvestingPro Tip indicating that the stock generally trades with high volatility.
For investors seeking a deeper analysis of Staffing 360 Solutions, InvestingPro offers additional tips, such as the company's cash burn rate and short-term liquidity challenges, with short-term obligations exceeding liquid assets. These insights are crucial for evaluating the company's financial resilience and risk profile.
Subscribers can access more comprehensive data and tips on Staffing 360 Solutions by visiting InvestingPro. Those interested in a subscription can use the promo code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. With 14 more InvestingPro Tips available, users can gain an extensive understanding of the company's financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.