 Second Quarter 2020 Overview Consulting Fee Revenue CFR of 75.8 million Net loss of 2.0 million, or 0.03 per diluted share Adjusted net income of 3.6 million or 0.06 per diluted share Adjusted EBITDA grew 7.3 over last years second quarter to 5.3 million New contract awards totaled approximately 70 million for the quarter ended June 30, 2020 Total liquidity at June 30, 2020 rose by 8.9 million from March 31, 2020 and cash from operations was 6.4 millionPHILADELPHIA, Aug. 05, 2020 GLOBE NEWSWIRE -- Hill International, Inc. NYSE:HIL Hill or the Company, the global leader in managing construction risk, announced today its financial results for the second quarter ended June 30, 2020 Q2 2020.While we are continuing to address the effects of COVID-19 on certain aspects of our operations, Hills Q2 2020 performance improved across several metrics compared to the first quarter of 2020 and we remain cautiously optimistic for the balance of the year, said Hill CEO Raouf Ghali. We generated operating profit and exited the second quarter in a strong financial position. I am very proud of how our team has responded to these challenges and their continuing commitment to serving our global client base. During Q2 2020, we secured approximately 70 million of new awards in Europe, the Middle East, and the United States. We continue to focus on global infrastructure projects, which we believe are resilient, sustainable and potential catalysts for economic growth as we emerge from this crisis.We reported our sixth consecutive quarter of positive Adjusted EBITDA, generated 6.4 million of cash from operations and, when compared to March 31, 2020, increased our total liquidity by 8.9 million to 27.8 million said Todd Weintraub, Hills Chief Financial Officer.Q2 2020 Financial Results OverviewHills consulting fee revenue CFR was 75.8 million, compared to 77.0 million in the second quarter of 2019 Q2 2019. CFR in Q2 of 2020 was negatively impacted by approximately 10.0 million from deferred and canceled projects due in large part to the uncertainties created by COVID-19.Selling, general, and administrative SGA expenses were 26.9 million, or 35.5 of CFR, compared to 27.4 million, or 35.6 of CFR, in Q2 2019. The Company is on track to achieve the 10 million in corporate cost reductions in 2020 announced last quarter.Operating profit for Q2 2020 was 3.3 million, compared to operating profit of 4.6 million in Q2 2019. Adjusted operating profit, a non-GAAP measure see definition and reconciliation below was 4.8 million in Q2 2020 compared to 4.2 million in Q2 2019.During Q2 2020, Hill determined to shut down its operations in Brazil, which had become increasingly challenging due to that countrys ongoing economic crisis and, more recently, the impact of COVID-19. These market forces combined to produce a negative impact on Hills total operations. In connection with the closure, Hill recorded a non-recurring, non-cash loss of 4.1 million Brazil Office Closure.Net loss attributable to Hill in Q2 2020 was 2.0 million, or 0.03 per diluted share, compared to net income attributable to Hill of 1.6 million, or 0.03 per diluted share, in Q2 2019, due primarily to the Brazil charge. Adjusted net income, a non-GAAP measure see definition and reconciliation in the table below, improved to 3.6 million from 1.2 million in Q2 2019.Adjusted EBITDA, a non-GAAP measure see definition and reconciliation below rose 7.3 to 5.3 million in Q2 2020 from 4.9 million in Q2 2019.Financial Condition and BacklogNet cash provided by operating activities in Q2 2020 improved to 6.4 million from net cash used in operating activities of 7.0 million in Q2 2019. Free cash flow as defined below for Q2 2020 was 6.2 million, which represents net cash provided by operating activities, less 0.1 million in purchases of property and equipment during the quarter. Free cash flow during Q2 2019 was 7.7 million, which represents net cash used in operating activities, less 0.7 million in property and equipment purchased during the quarter.Unrestricted cash at June 30, 2020 was 23.2 million, a 7.1 million improvement from March 31, 2020 and a 7.3 million increase from December 31, 2019. The Company had approximately 4.6 million in available and undrawn credit facilities at June 30, 2020, up 1.8 million from 2.8 million at March 31, 2020. These improvements increased the Companys total liquidity by 8.9 million from March 31, 2020.Cash flow generation and the increases in cash and liquidity during the quarter were achieved primarily from the Companys operating activities. The Company is currently evaluating the recently opened Main Street Lending Programs to determine its eligibility.Backlog which is a non-GAAP measure; see definition below decreased to 647.9 million at June 30, 2020 as compared to 706.5 million at March 31, 2020 and 764.7 million December 31, 2019, which included re-evaluation and write down of the realizable value of a number of contracts booked before January 1, 2019, some of which were as a result of the impacts of COVID-19. Backlog also declined in Q2 2020 as the result of other COVID-related cancellations and scope reductions.2020 Financial GuidanceCFR for 2020 is expected to range between 300 - 310 million, consisting of both new awards and extensions of existing contracts. Annual gross margin is targeted at 38 - 39 for 2020, consistent with previous guidance.SGA for 2020 is expected to approximate 110 million, down from our previous estimate of 120 million and reflecting the previously announced removal of an additional 10 million in annual corporate costs initiated in Q1 2020. Adjusted EBITDA for 2020 is expected to range between 16 million - 20 million.Non-GAAP MeasuresThe following measures below are not measures of financial performance under U.S. generally accepted accounting principles GAAP and should be considered in addition to and not as a substitute for, or superior to, the related measure of performance prepared in accordance with GAAP.BacklogBacklog represents the Companys estimate of the amount of uncompleted projects under contract and awards in-hand that are expected to be recognized as CFR in future periods as a component of total revenue. Hills backlog is based upon the binding nature of the underlying contract, commitment or letter of intent, and other factors, including the economic, financial and regulatory viability of the project and the likelihood of the contract being extended, renewed or canceled. Although backlog reflects business that the Company considers to be firm, cancellations or scope adjustments may occur. It is an important indicator of future performance and is used by the Company in planning Hills operational needs. Backlog is not a measure defined in GAAP and the Companys methodology for determining backlog may not be comparable to the methodology used by other companies in determining their backlog.Adjusted Operating Profit LossAdjusted operating profit loss is operating profit loss, adjusted to exclude non-recurring items and non-cash items including unrealized foreign currency exchange losses gains, share-based compensation and the write-off of leasehold improvements previously included in property and equipment on the Companys consolidated balance sheets. The Company believes that adjusted operating profit loss is useful to investors and other external users of Hills financial statements as a measure of a companys core ongoing operations, without regard to generally non-recurring items and non-cash activity.Adjusted Net Income Loss Attributable to HillAdjusted net income loss attributable to Hill is net income loss attributable to Hill, adjusted to exclude non-recurring and non-cash items including unrealized foreign currency exchange losses gains, share-based compensation and the write-off of leasehold improvements previously included in property and equipment on the Companys consolidated balance sheets. The Company believes that adjusted net income loss attributable to Hill is useful to investors and other external users of Hills financial statements as a measure of a companys operating performance, without regard to generally non-recurring items and non-cash activity.EBITDAEarnings before interest, taxes, depreciation and amortization EBITDA, in addition to operating profit, net income, and other GAAP measures, is a useful indicator of Hills financial and operating performance. Investors should recognize that EBITDA might not be comparable to similarly titled measures of other companies. The Company believes that EBITDA is useful to investors and other external users of Hills financial statements in evaluating its operating performance because EBITDA is widely used by investors to measure a companys operating performance without regard to items such as interest expense, taxes, and depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired.Adjusted EBITDA is EBITDA, adjusted to exclude the impact of certain items, including non-recurring, one-time costs as presented in the table below and non-cash items such as unrealized foreign currency exchange losses benefit and share-based compensation expense. The Company believes that adjusted EBITDA helps its investors and other external users of Hills financial statements understanding of a companys operating performance, without regard to non-recurring and other non-cash activity. 