<Off Tpoic> Melviticus. I pass buy there office every two weeks. Never knew they were a staffing company. "Home Boys is the term we use in Fayetteville Arkansas. "Hog Country".
StaffMark Announces Record Fourth Quarter and Year-End Results; Fourth Quarter Net Income Rises 122% on Revenue Increase of 149%
Tuesday, February 3, 1998 08:16 AM
> FAYETTEVILLE, Ark. -- StaffMark, Inc. (Nasdaq:STAF), a national staffing, professional and consulting services company, today announced record financial results for the fourth quarter and year ended December 31, 1997.
Revenues increased 149% to $139.2 million for the recent quarter, compared to $55.9 million of revenues in the fourth quarter a year ago. Operating income for the quarter rose 139% to $9.7 million compared to operating income of $4.1 million for the same period last year. Net income for the quarter reached $5.8 million or $0.30 per share on 19.1 million basic shares outstanding and $0.29 per share on 19.9 million diluted shares outstanding, compared to the fourth quarter of 1996 net income of $2.6 million or $0.20 basic and diluted earnings per share on 13.2 million shares.
For the year ended December 31, 1997, revenues rose 115% to $426.5 million compared to combined revenues of $198.4 million for 1996. Operating income rose to $28.4 million, a 153% increase over the combined operating income of $11.2 million in 1996. Net income for the year reached $16.5 million or $1.03 per share on 16.0 million basic shares outstanding and $1.00 per share on 16.5 million shares on a diluted basis, compared to pro forma net income for 1996 of $6.4 million or $O.67 basic and diluted earnings per share on 9.6 million shares.
Commenting on the announcement, Clete T. Brewer, president and chief executive officer, said, "StaffMark set ambitious goals for 1997 and we not only met, but exceeded those goals. We completed 19 acquisitions last year, and continued to exhibit internal growth above industry averages. With each acquisition we are integrating and building an infrastructure that enables us to both manage today and lay the groundwork for future growth. In August, we successfully completed a secondary stock offering that provided additional resources for our acquisition program. This combined growth resulted in net income increasing 122% for the fourth quarter and 159% when compared to pro forma 1996 net income. Our diluted earnings per share rose 49% in 1997 when compared to pro forma 1996 diluted earnings per share."
The acquisitions completed by the company during 1997 had aggregate annual revenues of $226 million during their most recent fiscal year prior to becoming a StaffMark company. Acquisitions completed in the fourth quarter 1997 targeted the information technology and professional services area and included: RHS Associates, headquartered in Birmingham, Alabama; EMJAY Contract Services, headquartered in Houston, Texas; Structured Logic, headquartered in New York, New York; and ClinForce, headquartered in Morristown, New Jersey. RHS, EMJAY, and Structured Logic all provide information technology consulting services while ClinForce specializes in the clinical trials research support area. Since year end, StaffMark has acquired Strategic Legal Resources, a professional services firm specializing in the placement of junior and senior level attorneys to many of the top companies and law firms in the New York metropolitan area.
Brewer continued, noting that, "These acquisitions continue to diversify our revenue mix while expanding our geographic presence and our ability to deliver new services to our clients. One year ago, our information technology and professional services division accounted for only 5% of annual revenues. Today, that division accounts for approximately 30% of total annual revenues and has operations in 20 states, South Africa, and the United Kingdom."
"StaffMark remains committed to a growth strategy that includes both strategic acquisitions and strong internal growth," added Brewer. "We continue to maintain a strong capital and liquidity position and have a commitment from our bank group to increase our credit facility from $100 to $150 million to ensure adequate resources to carry out our growth strategy during 1998."
StaffMark, Inc., is a leading national provider of diversified staffing, professional, and consulting services to businesses, professional and service organizations, medical niches, and governmental agencies. Since its initial public offering in October 1996, StaffMark has acquired 23 staffing and professional services companies that have allowed the company to grow geographically and expand its presence in the rapidly growing professional, information technology, and specialty niche areas. The Company intends to continue its acquisition program by aligning itself with quality organizations that have strong management, good growth opportunities, and recognized local and regional presence. StaffMark operates over 190 offices in 27 states, Canada, South Africa, and the United Kingdom.
STAFFMARK INC.
Combined Statements of Income
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Year Ended
December 31, December 31,
1997 1996 1997 1996(a)
Service revenues $ 139,233 $ 55,901 $ 426,496 $ 198,444
Cost of services 106,344 43,344 329,727 155,472
Gross profit 32,889 12,557 96,769 42,972
Operating expenses:
Selling, general
and administrative 21,051 7,971 63,013 29,840
Depreciation and
amortization 2,100 509 5,317 1,911
Operating income $ 9,738 $ 4,077 $ 28,439 $ 11,221
Net income $ 5,773 $ 2,597 $ 16,469 $ 6,368(b)
Basic earnings per share$ 0.30 $ 0.20 $ 1.03 $ 0.67(b)
Dilutive earnings
per share $ 0.29 $ 0.20 $ 1.00 $ 0.67(b)
(a) Operating results for the year ended December 31, 1996 are reported to the Securities and Exchange Commission ("SEC") in accordance with the provisions of the SEC Staff Accounting Bulletin No. 97. The pronouncement requires that one of the founding companies of StaffMark be identified as the acquirer for financial reporting purposes. Therefore, results reported for the year ended December 31, 1996 represent only the operations of the identified acquiring company rather than the combined operating results as presented above.
(b) Pro forma net income and earnings per share reflect the financial results of the operations of the companies which merged effective with the initial public offering as if the companies had been members of the same operating group, adjusted to reflect the effect of significant acquisitions adjustments for corporate income taxes, and reductions in owner's compensation.
This release contains forward-looking statements which involve risk and uncertainties with respect to growth opportunities and their impact on 1997 earnings. The Company's actual results could differ materially from the results anticipated in these forward-looking statements as a result of loss of existing customers, loss of key management, unexpected costs, or operational problems in addition to those certain risk factors set forth under "Risk Factors" and elsewhere in the Company's Prospectus filed with the Securities and Exchange Commission on August 21, 1997, under the Securities Act of 1933, and in the Company's reports on Forms 10-K, 10-Q, and 8-K, made under the Securities Exchange Act of 1934.
/NOTE TO EDITORS: News releases and other information on StaffMark can be
accessed at: staffmark.com and at ctaonline.com
on the Internet/
/CONTACT: Clete T. Brewer, President and CEO, or Terry C. Bellora,
CFO,
both of StaffMark, Inc., 501-973-6084/
Quote for referenced ticker symbols: STAFc 1998, PR Newswire |
