MDC Partners shares were up nearly 9% to $2.55 in mid-morning trading after disclosing third-quarter results that missed Wall Street profit expectations but exceeded projections for revenue, which were flat.
An analysis by Buckner Business Daily issued Monday shows that MDC’s stock was down 9.65% last week and is down nearly 80% over the past year, largely due to disappointing results for the first half of 2018.
MDC, which took a $21 million third-quarter impairment charge, reported organic growth of 1.5% for the period but just 0.2% for the first nine months of the year.
The company also trimmed its guidance again for full-year 2018 organic growth to 1%. At the beginning of the year, the company estimated it could generate 4% organic growth. That estimate was later reduced to between 1% and 3%.
Earlier, the company confirmed that it has retained LionTree advisors and JP Morgan to assist with a strategic review including a possible sale of the company.
That review comes after MDC announced last month that company CEO Scott Kauffman was stepping down and that recruitment firm Spencer Stuart has been retained to help find a successor. Notably, Kauffman, who remains CEO until a successor is in place, was not on today’s earnings call with analysts and investors.
On the call CFO David Doft declined to field questions about progress on either front. “We'll provide further updates on both the strategic review and CEO search process at the appropriate time. I should note that we cannot comment further or take questions on either [issue] on today's call.”
Doft did say on the call that the company has “made significant progress in reducing the cost structure across several units, over $50 million annualized, which sets us up for an earnings recovery in 2019.”
“We look forward to a better fourth quarter and 2019,” he added.