Kforce Inc. Logo

Print Print page   Email Email page   PDF Download PDF    Add to Briefcase
« Previous Release | Next Release »



Kforce Reports Fourth Quarter Revenue of $258.5 Million and EPS of $0.16

TAMPA, Fla., Feb. 8, 2011 (GLOBE NEWSWIRE) -- Kforce Inc. (Nasdaq:KFRC), a provider of professional staffing services and solutions, today announced results for its fourth quarter of 2010. Revenue for the quarter ended December 31, 2010 was $258.5 million compared to $259.5 million for the quarter ended September 30, 2010, a decrease of 0.4%, and compared to $224.6 million for the quarter ended December 31, 2009, an increase of 15.1%. For the quarter ended December 31, 2010, Kforce reported net income of $6.3 million, or $0.16 per share, versus $6.4 million , or $0.16 per share, for the quarter ended September 30, 2010, a decrease of 1.6% in net income while EPS was flat. Net income and earnings per share for the fourth quarter of 2010 increased 79.4% and 77.8%, respectively, versus the fourth quarter of 2009, which had net income of $3.5 million and $0.09 per share.

Kforce reported total revenue for the year ended December 31, 2010 of $990.8 million compared to $910.1 million for 2009, an increase of 8.9%. Net income was $20.6 million, or $0.51 per share, for the year ended December 31, 2010, compared to net income of $12.9 million, or $0.33 per share, for 2009, which represents an increase of 60.3% in net income and 54.5% in earnings per share.

"We are pleased with our fourth quarter results, particularly the year-over-year increases in Tech Flex and FA Flex of 18.5% and 34.1%, respectively, as we continue to leverage our National Recruiting Center (NRC) and Strategic Accounts groups to capture revenue opportunities. We also continue to perform well in permanent placement with a year-over-year increase of 49.4%. The U.S. economic environment in 2010 was unique in that we have seen a disproportionate amount of private sector hiring coming through the temporary portion of payroll. We believe Kforce is well positioned to service our clients' increasing desire for a more flexible workforce during this unique temporary employment led recovery, which we believe may continue to contribute to a sustained secular shift toward a flexible staffing model. We believe that we will surpass prior peak earnings earlier in the cycle with a higher quality revenue stream that is less dependent upon permanent placement revenue. We are proud of our 2010 results and we remain optimistic about the Firm's prospects. I want to thank all of our employees, consultants and clients for making 2010 a successful year for Kforce," said David L. Dunkel, Chairman and CEO.

William L. Sanders, President, said, "Discussions with clients, as well as our internal key performance indicators (KPI's), indicate that demand continues to accelerate, particularly in Tech and FA. Accordingly, the Firm continues to focus its efforts on the optimization of the NRC, Strategic Accounts and field sales teams to take advantage of this strengthening demand. We believe that our strong sales and delivery operating platform and highly tenured sales population provides exceptional service to our clients. Kforce continues to aggressively pursue business opportunities with the goal of continuing to gain client and market share." Mr. Sanders noted additional operational results for the fourth quarter include:

Joe Liberatore, Chief Financial Officer, said, "The Firm continued to perform well in Q4 '10, both in terms of revenue and earnings per share. Q4 '10 and Q4 '09 each contained 61 billings days while Q3 '10 contained 64 billing days. We believe our fourth quarter results reflect our strong culture, tenured sales associate population and a continued focus on execution in all aspects of the business, including improving client relationships, expanding bill/pay rate spreads, solid expense management and optimizing cash flow."

Mr. Liberatore indicated financial highlights for the fourth quarter to include:

Mr. Liberatore stated, "Looking forward to the first quarter of 2011, we expect revenue may be in the $259 million to $265 million range and earnings per share in the range of $0.12 to $0.14 per share, which reflects an impact of approximately $0.05 per share of payroll taxes. The first quarter of 2011 has 63 versus 61 billing days in the fourth quarter of 2010."

On Tuesday, February 8, 2011, Kforce will host a conference call to discuss these results. The call will begin at 5:00 p.m. Eastern Time. The dial-in number is 877-344-3890. The replay of the call will be available from 7:00 p.m. Eastern Time Tuesday, February 8 to February 23, 2011 by dialing 800-642-1687, passcode 16895536.

This call is being webcast by Shareholder.com and can be accessed at Kforce's web site at www.kforce.com (select "Investor Relations"). The webcast replay will be available until February 22, 2011.

About Kforce

Kforce (Nasdaq:KFRC) is a professional staffing and solutions firm providing flexible and permanent staffing solutions in the skill areas of technology, finance & accounting, and health and life sciences and government solutions. Backed by approximately 2,100 associates and approximately 10,400 consultants on assignment, Kforce is committed to "Great People = Great Results" for our valued clients and candidates. Kforce operates with 65 offices located throughout the United States and two offices in the Philippines. For more information, please visit our Web site at http://www.kforce.com.

The Kforce Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3749

About Kforce Government Solutions (KGS)

KGS provides innovative technology, financial management, data architecture and finance and accounting solutions primarily to federal government clients. KGS, with approximately 600 professionals currently on assignment, has been partnering with our clients since 1970 to successfully solve their challenges. KGS' in-depth operational knowledge and understanding of Federal Agencies, the Defense Department, Homeland Security and industry best practices, combined with expert and highly-skilled professionals, have resulted in a comprehensive portfolio of technology advanced and innovative consulting solutions designed to guide clients through today's environment of complex challenges, risk, and cost. For more information, visit http://www.kforcegov.com.

Certain of the above statements contained in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended. Factors that could cause actual results to differ materially include the following: business conditions and growth in the staffing industry and general economy; competitive factors, risks due to shifts in the market demand, including, without limitation, shifts in demand for our Technology, Finance and Accounting, Health and Life Sciences and Government Solutions segments, as well as the market for search and flexible staffing assignments; changes in the service mix; ability of the Firm to complete acquisitions; and the risk factors listed from time to time in the Firm's reports filed with the Securities and Exchange Commission, as well as assumptions regarding the foregoing. In particular, there can be no assurance that we will continue to increase our market share, successfully manage risks to our revenue stream and successfully put into place the people and processes that will create future success. The words "should," "believe," "estimate," "expect," "intend," "anticipate," "foresee," "plan" and similar expressions and variations thereof identify certain of such forward-looking statements, which speak only as of the dates on which they were made. The Firm undertakes no obligation to publicly update or revise any forward-looking statements. As a result, such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Readers are cautioned not to place undue reliance on these forward-looking statements.

Kforce Inc.
Summary of Operations
(In Thousands, Except Per Share Amounts)
(Unaudited)
       
  Three Months Ended
       
  Dec. 31,
2010
Sept. 30,
2010
Dec. 31,
2009
       
Revenue by function:      
Technology   $ 142,869  $ 141,930  $ 119,478
Finance & Accounting   53,449  50,170  39,896
Health & Life Sciences   38,864  41,229  37,481
Government Solutions   23,313  26,190  27,747
Total revenue 258,495 259,519 224,602
       
Revenue by time:      
Flexible 247,437 248,960 217,199
Perm 11,058 10,559 7,403
Total revenue 258,495 259,519 224,602
       
Costs of services 176,086 176,054 154,781
Gross profit  82,409  83,465  69,821
GP % 31.9% 32.2% 31.1%
Flex GP % 28.8% 29.3% 28.7%
       
Selling, general & administrative expenses 68,700 69,321 60,645
Depreciation & amortization 3,262 3,236 2,919
       
Income from operations 10,447 10,908 6,257
       
Other expense, net 266 387 249
       
Income before income taxes 10,181 10,521 6,008
       
Income tax expense 3,843 4,077 2,475
       
Net income   $ 6,338  $ 6,444  $ 3,533
       
Earnings per share - diluted  $ 0.16  $ 0.16  $ 0.09
Adjusted EBITDA per share  $ 0.37  $ 0.39  $ 0.24
Shares outstanding - diluted  40,848 40,384 39,803
       
Adjusted EBITDA   $ 15,207  $ 15,710  $ 9,628
       
Other information:      
Capital expenditures  $ 3,314  $ 3,345  $ 1,304
Equity-based compensation expense, net  $ 1,383  $ 1,171  $ 606
       
Billing days  61  64  61
 
 
Kforce Inc.
Summary of Operations
(In Thousands, Except Per Share Amounts)
(Unaudited)
     
  Twelve Months Ended
     
  Dec. 31,
2010
Dec. 31,
2009
     
Revenue by function:    
Technology   $ 538,566  $ 467,824
Finance & Accounting   187,196  162,856
Health & Life Sciences   161,913  164,933
Government Solutions   103,132  114,523
Total revenue 990,807 910,136
     
Revenue by time:    
Flexible 951,430 881,734
Perm 39,377 28,402
Total revenue 990,807 910,136
     
Costs of services 678,393 624,157
Gross profit  312,414  285,979
GP % 31.5% 31.4%
Flex GP % 28.7% 29.2%
     
Selling, general & administrative expenses 265,183 251,268
Depreciation & amortization 12,611 11,673
     
Income from operations 34,620 23,038
     
Other expense, net 1,296 1,145
     
Income before income taxes 33,324 21,893
     
Income tax expense 12,690 9,020
     
Net income   $ 20,634  $ 12,873
     
Earnings per share - diluted  $ 0.51  $ 0.33
Adjusted EBITDA per share  $ 1.31  $ 1.07
Shares outstanding - diluted  40,503 39,330
     
Adjusted EBITDA   $ 53,225  $ 42,145
     
Other information:    
Capital expenditures  $ 39,857  $ 4,935
Equity-based compensation expense, net  $ 4,705  $ 5,197
     
Billing days  251  251
 
 
Kforce Inc.
Key Statistics
(Unaudited)
       
       
  Q4 2010 Q3 2010 Q4 2009
       
Total Firm      
Flex revenue (000's)  $ 247,437  $ 248,960  $ 217,199
Revenue per billing day (000's)  $ 4,056  $ 3,890  $ 3,561
Sequential flex revenue change -0.6% 5.4% -2.0%
Hours (000's)  4,427  4,303  3,713
Flex GP % 28.8% 29.3% 28.7%
       
Search revenue (000's)  $ 11,058  $ 10,559  $ 7,403
Placements   811  824  607
Average fee  $ 13,633  $ 12,819  $ 12,197
Billing days  61  64  61
       
Technology      
Flex revenue (000's)  $ 138,467  $ 137,326  $ 116,817
Revenue per billing day (000's)  $ 2,270  $ 2,146  $ 1,915
Sequential flex revenue change 0.8% 5.7% 1.8%
Hours (000's)  2,233  2,186  1,888
Flex GP % 28.0% 28.0% 27.0%
       
Search revenue (000's)  $ 4,402  $ 4,604  $ 2,661
Placements   309  311  205
Average fee  $ 14,257  $ 14,822  $ 12,964
       
Finance & Accounting      
Flex revenue (000's)  $ 47,512  $ 44,437  $ 35,432
Revenue per billing day (000's)  $ 779  $ 694  $ 581
Sequential flex revenue change 6.9% 16.5% -5.8%
Hours (000's)  1,447  1,340 1,103
Flex GP % 30.7% 30.9% 29.9%
       
Search revenue (000's)  $ 5,937  $ 5,733  $ 4,464
Placements   472  497  381
Average fee  $ 12,570  $ 11,533  $ 11,727
       
Health & Life Sciences      
Flex revenue (000's)  $ 38,145  $ 41,007  $ 37,203
Revenue per billing day (000's)  $ 625  $ 641  $ 610
Sequential flex revenue change -7.0% -0.1% -7.4%
Hours (000's)  504  493  416
Flex GP % 27.7% 28.8% 28.8%
       
Search revenue (000's)  $ 719  $ 222  $ 278
Placements  30  16  21
Average fee  $ 23,962  $ 13,876  $ 13,216
       
Government Solutions      
Flex revenue (000's)  $ 23,313  $ 26,190  $ 27,747
Revenue per billing day (000's)  $ 382  $ 409  $ 455
Sequential flex revenue change -11.0% -3.3% -4.9%
Hours (000's)  243  284 306
Flex GP % 32.0% 34.3% 34.7%
 
 
Kforce Inc.
Key Statistics - Health & Life Sciences
(Unaudited)
       
       
  Q4 2010 Q3 2010 Q4 2009
       
Clinical Research      
Flex revenue (000's)  $ 22,497  $ 26,331  $ 23,874
Revenue per billing day (000's)  $ 369  $ 412  $ 391
Sequential flex revenue change -14.6% -4.2% -10.1%
Hours (000's)  249  282  262
Flex GP % 24.2% 26.6% 26.2%
       
Search revenue (000's)  $ 491  $ 92  $ 111
Placements   12  5  6
Average fee  $ 40,895  $ 18,333  $ 18,526
       
Health Information Management      
Flex revenue (000's)  $ 15,648  $ 14,676  $ 13,329
Revenue per billing day (000's)  $ 256  $ 229  $ 219
Sequential flex revenue change 6.6% 8.1% -2.1%
Hours (000's)  255  211  154
Flex GP % 32.7% 32.8% 33.3%
       
Search revenue (000's)  $ 228  $ 130  $ 167
Placements   18  11  15
Average fee  $ 12,674  $ 11,850  $ 11,092
 
 
 Kforce Inc. 
 Consolidated Balance Sheets 
 (In Thousands) 
 (Unaudited) 
     
   Dec. 31, 2010   Dec. 31, 2009 
 ASSETS     
     
 Current Assets:     
 Cash and cash equivalents   $ 1,055  $ 2,812
 Trade receivables, net of allowances  148,507  123,144
 Income tax refund receivable  5,675  246
 Deferred tax asset, net  4,950  6,011
 Prepaid expenses and other current assets  5,014  4,924
 Total current assets   165,201  137,137
     
 Fixed assets, net   38,130  11,407
 Other assets, net   32,941  32,914
 Deferred tax asset, net   8,907  10,380
 Intangible assets, net   7,787  10,075
 Goodwill   138,078  137,912
 Total assets   $ 391,044  $ 339,825
     
 LIABILITIES AND STOCKHOLDERS' EQUITY     
     
 Current Liabilities:     
 Accounts payable and other accrued liabilities   $ 30,602  $ 25,437
 Accrued payroll costs   54,461  50,690
 Current debt - credit facility   10,825  -- 
 Other current liabilities   4,185  2,807
 Income taxes payable   250  279
 Total current liabilities   100,323  79,213
     
 Long-term debt - credit facility   --   3,000
 Long-term debt - other   2,103  1,784
 Other long-term liabilities   34,801  29,103
 Total liabilities   137,227  113,100
     
 Commitments and contingencies     
     
 Stockholders' Equity:     
 Preferred stock   --  --
 Common stock   646  633
 Additional paid-in capital   355,888  338,890
 Accumulated other comprehensive loss   (1,480)  (1,213)
 Retained earnings   61,979  41,345
 Treasury stock, at cost   (163,216)  (152,930)
 Total stockholders' equity   253,817  226,725
 Total liabilities and stockholders' equity   $ 391,044  $ 339,825
 
 
Kforce Inc.
Selected Financial Information and Reconciliations
(In Thousands, Except Per Share Amounts)
(Unaudited)
               
Quarterly Adjusted EBITDA              
  Three Months Ended  
  Dec. 31,
2010
Sept. 30,
2010
Dec. 31,
2009
 
  $ Per share $ Per share $ Per share  
               
Net income  $ 6,338  $ 0.16  $ 6,444  $ 0.16  $ 3,533  $ 0.09  
Depreciation & amortization  3,262   0.08  3,236  0.08  2,919  0.07  
Amortization of restricted stock & PARS  1,499   0.03  1,631  0.04  413  0.01  
Interest expense and other  265   0.01  322  0.01  288  0.01  
Income tax expense  3,843  0.09  4,077  0.10  2,475  0.06  
Adjusted EBITDA  $ 15,207  $ 0.37  $ 15,710  $ 0.39  $ 9,628  $ 0.24  
               
Weighted average shares outstanding - diluted  40,848    40,384    39,803    

Adjusted EBITDA, a non-GAAP financial measure, is defined as net income before non-cash impairment charges, interest, income taxes, depreciation and amortization and amortization of stock-based compensation expense. Adjusted EBITDA should not be considered a measure of financial performance under generally accepted accounting principles. Items excluded from Adjusted EBITDA are significant components in understanding and assessing financial performance. 

Quarterly Net Income before Equity-Based Compensation Expense
             
  Three Months Ended
  Dec. 31,
2010
Sept. 30,
2010
Dec. 31,
2009
  $ Per share $ Per share $ Per share
             
Net income  $ 6,338  $ 0.16  $ 6,444  $ 0.16  $ 3,533  $ 0.09
Equity-based compensation expense, net:            
Alternative LTI expense  722  0.02  281  0.01  617  0.01
Amortization of restricted stock & PARS  1,499  0.03  1,631  0.04  413  0.01
Income tax benefit  (838)  (0.02)  (741)  (0.02)  (424)  (0.01)
Equity-based compensation expense, net  1,383  0.03  1,171  0.03  606  0.01
Net income before equity-based compensation expense  $ 7,721  $ 0.19  $ 7,615  $ 0.19  $ 4,139  $ 0.10
             
Weighted average shares outstanding - diluted  40,848    40,384    39,803  

"Net Income before Equity-Based Compensation Expense", a non-GAAP financial measure, is defined as net income before compensation expense incurred in conjunction with share-based payment awards and alternative long-term incentive awards. Kforce measures the cost of employee services received in exchange for an equity based award based on the grant-date fair value of the award (with limited exceptions). That cost is recognized over the period in which the employee is required to provide service in exchange for the award, which is usually the vesting period.

Adjusted EBITDA and Net Income before Equity-Based Compensation Expense are key measures used by management to evaluate its operations and to provide useful information to investors. These measures should not be considered in isolation or as an alternative to net income, cash flows data or other financial statement information presented in the consolidated financial statements as indicators of financial performance or liquidity. These measurements are not determined in accordance with generally accepted accounting principles and are thus susceptible to varying calculations. The measures as presented may not be comparable to similarly titled measures of other companies.

Kforce Inc.
Selected Financial Information and Reconciliations
(In Thousands, Except Per Share Amounts)
(Unaudited)
         
Year to Date Adjusted EBITDA        
         
  Twelve Months Ended
  Dec. 31,
2010
Dec. 31,
2009
  $ Per share $ Per share
         
Net Income  $ 20,634  $ 0.51  $ 12,873  $ 0.33
Intangible Asset Impairment, Pre-Tax  --   --   870  0.02
Depreciation & Amortization  12,611  0.31  11,673  0.30
Acceleration of PARS & SARS  --   --   3,624  0.09
Amortization of Stock Options & SARS  --   --   127  0.00
Amortization of Restricted Stock & PARS  6,036  0.15  2,620  0.07
Interest Expense and Other  1,254  0.03  1,338  0.03
Income Tax Expense  12,690  0.31  9,020  0.23
Adjusted EBITDA  $ 53,225  $ 1.31  $ 42,145  $ 1.07
         
Weighted Average Shares Outstanding - Diluted  40,503    39,330  

Adjusted EBITDA, a non-GAAP financial measure, is defined as net income before non-cash impairment charges, interest, income taxes, depreciation and amortization and amortization of stock-based compensation expense. Adjusted EBITDA should not be considered a measure of financial performance under generally accepted accounting principles. Items excluded from Adjusted EBITDA are significant components in understanding and assessing financial performance.

Year to Date Net Income before Equity-Based Compensation Expense
         
  Twelve Months Ended
  Dec. 31,
2010
Dec. 31,
2009
  $ Per share $ Per share
         
Net Income  $ 20,634  $ 0.51  $ 12,873  $ 0.33
Equity-Based Compensation Expense, Net:        
Alternative LTI Expense  1,563  0.04  2,467  0.06
Acceleration of PARS & SARS  --   --   3,624  0.09
Amortization of Stock Options & SARS  --   --   127  0.00
Amortization of Restricted Stock & PARS  6,036  0.15  2,620  0.07
Income Tax Benefit   (2,894)  (0.07)  (3,641)  (0.09)
Equity-Based Compensation Expense, Net  4,705  0.12  5,197  0.13
Net Income before Equity-Based Compensation Expense  $ 25,339  $ 0.63  $ 18,070  $ 0.46
         
Weighted Average Shares Outstanding - Diluted  40,503    39,330  

"Net Income before Equity-Based Compensation Expense", a non-GAAP financial measure, is defined as net income before compensation expense incurred in conjunction with share-based payment awards and alternative long-term incentive awards. Kforce measures the cost of employee services received in exchange for an equity based award based on the grant-date fair value of the award (with limited exceptions). That cost is recognized over the period in which the employee is required to provide service in exchange for the award, which is usually the vesting period.

Adjusted EBITDA and Net Income before Equity-Based Compensation Expense are key measures used by management to evaluate its operations and to provide useful information to investors. These measures should not be considered in isolation or as an alternative to net income, cash flows data or other financial statement information presented in the consolidated financial statements as indicators of financial performance or liquidity. These measurements are not determined in accordance with generally accepted accounting principles and are thus susceptible to varying calculations. The measures as presented may not be comparable to similarly titled measures of other companies.

CONTACT: Michael Blackman

         Chief Corporate Development Officer

         (813) 552-2927

Kforce Inc. Logo

Source: Kforce Inc.

News Provided by Acquire Media

Close window | Back to top