Press Releases
Kforce Reports Record Annual Revenues of $1.32 Billion, Up 8.4% Year Over Year
Record EPS From Continuing Operations of
Flex Staffing Revenue Up 8.9% Year Over Year
Fourth Quarter Revenues of
Mr. Liberatore noted additional operational results for the fourth quarter include:
- Flex revenues of
$314.3 million in Q4 ‘15 decreased 0.9% on a billing day basis, from$327.4 million in Q3 ‘15 and increased 2.4% from$306.8 million in Q4 ‘14. - Direct Hire revenues of
$13.4 million in Q4 ‘15 decreased 5.1% from$14.1 million in Q3 ‘15 and increased 12.6% from$11.9 million in Q4 ‘14. - Revenue-generating associates increased 9.5% year-over-year with nearly all additions in the fourth quarter concentrated in Tech Flex sales.
We are also pleased to announce that our Board of Directors declared a first quarter cash dividend on
Highlights for the fourth quarter include:
- Flex gross profit margin of 28.7% in Q4 ‘15 decreased 50 basis points from 29.2% in Q3 ‘15 and increased 50 basis points from 28.2% in Q4 ‘14.
- Selling, general and administrative expense as a percentage of revenues in Q4 ‘15 was 24.6%, which is flat compared to 24.6% in Q3 ‘15 and down 90 basis points from 25.5% in Q4 ‘14.
- The Firm repurchased 503 thousand shares of common stock on the open market at a total cost of approximately
$13.2 million in Q4 ‘15. - Adjusted EBITDA was
$24.6 million in Q4 ‘15 and$89.3 million for the full year 2015.
Looking forward to the first quarter of 2016, there will be 64 billing days, as compared to 62 billing days in the fourth quarter of 2015, and 63 billing days in the first quarter of 2015. Current estimates for the first quarter of 2016 are:
- Revenues of
$323 million to$328 million - Earnings per share of
$0.24 to$0.27 - Gross profit margin of 30.6% to 30.9%
- SG&A expense as a percent of revenue of 26.3% to 26.6%
- Operating margin of 3.4% to 3.8%
- Effective tax rate of 39.0%
On
The dial-in number is (877) 344-3890. The conference passcode is
This call is being webcast by
About
The
Certain of the above statements contained in this press release, including earnings projections, 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 Exchange 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 and Government Solutions segments, as well as the market for direct hire and flexible staffing assignments; a reduction in the supply of candidates for temporary employment or the Firm's ability to attract candidates; the success of the Firm in attracting and retaining revenue-generating headcount; changes in the service mix; ability of the Firm to repurchase shares; ability of the Firm to complete and integrate acquisitions; the effect of adverse weather conditions; changes in our effective tax rate; and the risk factors listed from time to time in the Firm's reports filed with the
| Summary of
Operations | ||||||||||||
| (In Thousands, Except Per Share Amounts) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| Revenue by function: | ||||||||||||
| Technology | $ | 218,026 | $ | 232,113 | $ | 217,154 | ||||||
| Finance & accounting | 86,816 | 85,111 | 75,038 | |||||||||
| Government solutions | 22,857 | 24,351 | 26,547 | |||||||||
| Total revenue | 327,699 | 341,575 | 318,739 | |||||||||
| Costs of services | 224,184 | 231,754 | 220,361 | |||||||||
| Gross profit | 103,515 | 109,821 | 98,378 | |||||||||
| GP % | 31.6 | % | 32.2 | % | 30.9 | % | ||||||
| Flex GP % | 28.7 | % | 29.2 | % | 28.2 | % | ||||||
| Selling, general & administrative expenses | 80,702 | 84,167 | 81,120 | |||||||||
| Depreciation & amortization | 2,429 | 2,579 | 2,503 | |||||||||
| Income from operations | 20,384 | 23,075 | 14,755 | |||||||||
| Other expense, net | 288 | 463 | 367 | |||||||||
| Income from continuing operations before income taxes | 20,096 | 22,612 | 14,388 | |||||||||
| Income tax expense | 8,195 | 9,067 | 5,327 | |||||||||
| Income from continuing operations | $ | 11,901 | $ | 13,545 | $ | 9,061 | ||||||
| Loss from discontinued operations, net of income taxes | — | — | (116 | ) | ||||||||
| Net income | $ | 11,901 | $ | 13,545 | $ | 8,945 | ||||||
| Earnings per share - diluted: | ||||||||||||
| From continuing operations | $ | 0.43 | $ | 0.48 | $ | 0.31 | ||||||
| From discontinued operations | $ | — | $ | — | $ | (0.01 | ) | |||||
| Earnings per share - diluted | $ | 0.43 | $ | 0.48 | $ | 0.30 | ||||||
| Weighted average shares outstanding - diluted | 27,793 | 28,132 | 29,460 | |||||||||
| Adjusted EBITDA per share | $ | 0.88 | $ | 0.96 | $ | 0.62 | ||||||
| Adjusted EBITDA | $ | 24,556 | $ | 26,997 | $ | 18,194 | ||||||
| Billing days | 62 | 64 | 62 | |||||||||
| Summary of Operations | ||||||||
| (In Thousands,
Except Per Share Amounts) | ||||||||
| (Unaudited) | ||||||||
| Twelve Months Ended | ||||||||
| Revenue by function: | ||||||||
| Technology | $ | 895,942 | $ | 842,469 | ||||
| Finance & accounting | 325,924 | 276,811 | ||||||
| Government solutions | 97,372 | 98,051 | ||||||
| Total revenue | 1,319,238 | 1,217,331 | ||||||
| Costs of services | 905,124 | 842,750 | ||||||
| Gross profit | 414,114 | 374,581 | ||||||
| GP % | 31.4 | % | 30.8 | % | ||||
| Flex GP % | 28.5 | % | 28.0 | % | ||||
| Selling, general & administrative expenses | 330,416 | 315,338 | ||||||
| Depreciation & amortization | 9,831 | 9,894 | ||||||
| Income from operations | 73,867 | 49,349 | ||||||
| Other expense, net | 2,195 | 1,392 | ||||||
| Income from continuing operations before income taxes | 71,672 | 47,957 | ||||||
| Income tax expense | 28,848 | 18,559 | ||||||
| Income from continuing operations | $ | 42,824 | $ | 29,398 | ||||
| Income from discontinued operations, net of income taxes | — | 61,517 | ||||||
| Net income | $ | 42,824 | $ | 90,915 | ||||
| Earnings per share - diluted: | ||||||||
| From continuing operations | $ | 1.52 | $ | 0.93 | ||||
| From discontinued operations | $ | — | $ | 1.94 | ||||
| Earnings per share - diluted | $ | 1.52 | $ | 2.87 | ||||
| Weighted average shares outstanding - diluted | 28,190 | 31,691 | ||||||
| Adjusted EBITDA per share | $ | 3.17 | $ | 1.96 | ||||
| Adjusted EBITDA | $ | 89,282 | $ | 62,216 | ||||
| Billing days | 253 | 253 | ||||||
| Consolidated Balance
Sheets | ||||||||
| (In Thousands) | ||||||||
| (Unaudited) | ||||||||
| 2015 | 2014 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 1,497 | $ | 1,238 | ||||
| Trade receivables, net of allowances | 198,933 | 204,710 | ||||||
| Income tax refund receivable | 526 | 3,311 | ||||||
| Deferred tax asset, net | 4,518 | 4,980 | ||||||
| Prepaid expenses and other current assets | 9,060 | 10,170 | ||||||
| Total current assets | 214,534 | 224,409 | ||||||
| Fixed assets, net | 37,476 | 35,330 | ||||||
| Other assets, net | 28,671 | 30,349 | ||||||
| Deferred tax asset, net | 20,938 | 22,855 | ||||||
| Intangible assets, net | 4,235 | 5,011 | ||||||
| 45,968 | 45,968 | |||||||
| Total assets | $ | 351,822 | $ | 363,922 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and other accrued liabilities | $ | 39,227 | $ | 38,104 | ||||
| Accrued payroll costs | 46,125 | 52,208 | ||||||
| Other current liabilities | 1,287 | 986 | ||||||
| Income taxes payable | 1,107 | 2,885 | ||||||
| Total current liabilities | 87,746 | 94,183 | ||||||
| Long-term debt - credit facility | 80,472 | 93,333 | ||||||
| Long-term debt - other | 3,351 | 562 | ||||||
| Other long-term liabilities | 40,626 | 36,456 | ||||||
| Total liabilities | 212,195 | 224,534 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' Equity: | ||||||||
| Preferred stock | — | — | ||||||
| Common stock | 705 | 700 | ||||||
| Additional paid-in capital | 420,276 | 412,642 | ||||||
| Accumulated other comprehensive income (loss) | 318 | (371 | ) | |||||
| Retained earnings | 155,096 | 125,378 | ||||||
| (436,768 | ) | (398,961 | ) | |||||
| Total stockholders' equity | 139,627 | 139,388 | ||||||
| Total liabilities and stockholders' equity | $ | 351,822 | $ | 363,922 | ||||
| Key Statistics | ||||||||||||
| (Unaudited) | ||||||||||||
| Q4 2015 | Q3 2015 | Q4 2014 | ||||||||||
| Total Firm | ||||||||||||
| Flex revenue (000's) | $ | 314,286 | $ | 327,439 | $ | 306,824 | ||||||
| Flex revenue per billing day (000's) | $ | 5,069 | $ | 5,116 | $ | 4,949 | ||||||
| Sequential flex revenue change per billing day | (0.9 | )% | 1.4 | % | 5.1 | % | ||||||
| Year over year flex revenue change | 2.4 | % | 8.7 | % | 13.4 | % | ||||||
| Hours (000's) | 5,603 | 5,682 | 5,265 | |||||||||
| Flex GP % | 28.7 | % | 29.2 | % | 28.2 | % | ||||||
| Direct Hire revenue (000's) | $ | 13,413 | $ | 14,136 | $ | 11,915 | ||||||
| Placements | 995 | 1,009 | 857 | |||||||||
| Average fee | $ | 13,484 | $ | 14,015 | $ | 13,897 | ||||||
| Billing days | 62 | 64 | 62 | |||||||||
| Technology | ||||||||||||
| Flex revenue (000's) | $ | 212,917 | $ | 226,381 | $ | 212,414 | ||||||
| Flex revenue per billing day (000's) | $ | 3,434 | $ | 3,537 | $ | 3,426 | ||||||
| Sequential flex revenue change per billing day | (2.9 | )% | 0.2 | % | 3.3 | % | ||||||
| Year over year flex revenue change | 0.2 | % | 6.6 | % | 9.9 | % | ||||||
| Hours (000's) | 3,158 | 3,332 | 3,157 | |||||||||
| Flex GP % | 27.5 | % | 28.0 | % | 27.4 | % | ||||||
| Direct Hire revenue (000's) | $ | 5,109 | $ | 5,732 | $ | 4,740 | ||||||
| Placements | 323 | 353 | 305 | |||||||||
| Average fee | $ | 15,822 | $ | 16,247 | $ | 15,540 | ||||||
| Finance & Accounting | ||||||||||||
| Flex revenue (000's) | $ | 78,512 | $ | 76,707 | $ | 67,863 | ||||||
| Flex revenue per billing day (000's) | $ | 1,266 | $ | 1,199 | $ | 1,095 | ||||||
| Sequential flex revenue change per billing day | 5.6 | % | 5.4 | % | 9.1 | % | ||||||
| Year over year flex revenue change | 15.7 | % | 19.4 | % | 22.2 | % | ||||||
| Hours (000's) | 2,445 | 2,350 | 2,108 | |||||||||
| Flex GP % | 29.9 | % | 30.4 | % | 29.6 | % | ||||||
| Direct Hire revenue (000's) | $ | 8,304 | $ | 8,404 | $ | 7,175 | ||||||
| Placements | 672 | 656 | 552 | |||||||||
| Average fee | $ | 12,360 | $ | 12,815 | $ | 12,990 | ||||||
| Government Solutions | ||||||||||||
| Flex revenue (000's) | $ | 22,857 | $ | 24,351 | $ | 26,547 | ||||||
| Flex revenue per billing day (000's) | $ | 369 | $ | 380 | $ | 428 | ||||||
| Sequential flex revenue change per billing day | (2.9 | )% | 0.4 | % | 10.6 | % | ||||||
| Year over year flex revenue change | (13.9 | )% | (1.8 | )% | 22.4 | % | ||||||
| Flex GP % | 34.9 | % | 36.9 | % | 31.0 | % | ||||||
| Revenue Growth Rates | |||||||||||||||
| (Unaudited) | |||||||||||||||
| Year-Over-Year Growth Rates | |||||||||||||||
| (As Reported) | |||||||||||||||
| Q4 2015 | Q3 2015 | Q2 2015 | Q1 2015 | Q4 2014 | |||||||||||
| Tech Flex | 0.2 | % | 6.6 | % | 9.6 | % | 8.3 | % | 9.9 | % | |||||
| Tech Direct Hire | 7.8 | % | 6.7 | % | 24.9 | % | 29.8 | % | 9.3 | % | |||||
| Total Tech | 0.4 | % | 6.6 | % | 9.9 | % | 8.7 | % | 9.9 | % | |||||
| FA Flex | 15.7 | % | 19.4 | % | 21.2 | % | 15.9 | % | 22.2 | % | |||||
| FA Direct Hire | 15.7 | % | 17.9 | % | 7.9 | % | 21.0 | % | (0.9 | )% | |||||
| Total FA | 15.7 | % | 19.2 | % | 19.7 | % | 16.4 | % | 19.5 | % | |||||
| Total Staffing | 4.3 | % | 9.8 | % | 12.3 | % | 10.6 | % | 12.2 | % | |||||
| GS | (13.9 | )% | (1.8 | )% | 1.3 | % | 13.7 | % | 22.4 | % | |||||
| Total Firm | 2.8 | % | 8.8 | % | 11.4 | % | 10.8 | % | 13.0 | % | |||||
Non-GAAP Financial Measures
(In Thousands, Except Per Share Amounts)
(Unaudited)
The following non-GAAP financial measures presented may not provide information that is directly comparable to that provided by other companies, as other companies may calculate such financial results differently. The Company's non-GAAP financial measures are not measurements of financial performance under GAAP and should not be considered as alternatives to amounts presented in accordance with GAAP. The Company does not consider these non-GAAP financial measures to be a substitute for, or superior to, the information provided by GAAP financial results. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures is provided below.
Adjusted Income and Earnings Per Share from Continuing Operations
"Adjusted Income and Earnings Per Share from Continuing Operations", a non-GAAP financial measure, is defined as income and earnings per share from continuing operations, adjusted for certain non-recurring operating charges, which management believes are not indicative of the Company's core operating results. Adjusted Income and Earnings Per Share from Continuing Operations should not be considered a measure of financial performance under generally accepted accounting principles and are presented as an alternative method for assessing the Company's operating results in a manner that is focused on the performance of our ongoing operations. Management believes this financial measure is useful to investors to provide consistency and comparability of the 2015 results with income earnings per share from continuing operations and from prior periods.
| Twelve Months Ended | ||||||||||||||||
| $ | Per share | $ | Per share | |||||||||||||
| Net income | $ | 42,824 | $ | 1.52 | $ | 90,915 | $ | 2.87 | ||||||||
| Income from discontinued operations, net of income taxes | — | — | 61,517 | 1.94 | ||||||||||||
| Income from continuing operations | $ | 42,824 | $ | 1.52 | $ | 29,398 | $ | 0.93 | ||||||||
| Non-recurring operating charges, pre-tax: | ||||||||||||||||
| Post retirement health benefit plan terminations | — | — | 1,548 | 0.05 | ||||||||||||
| Severance and termination-related expenses | — | — | 502 | 0.01 | ||||||||||||
| Inventory adjustment related to KGS product business | — | — | 370 | 0.01 | ||||||||||||
| Non-recurring operating charges, pre-tax: | — | — | 2,420 | 0.07 | ||||||||||||
| Income tax expense | — | — | 937 | 0.03 | ||||||||||||
| Adjusted income from continuing operations | $ | 42,824 | $ | 1.52 | $ | 30,881 | $ | 0.97 | ||||||||
| Weighted average shares outstanding - basic | 27,910 | 31,475 | ||||||||||||||
| Weighted average shares outstanding - diluted | 28,190 | 31,691 | ||||||||||||||
Adjusted EBITDA and Earnings Per Share
"Adjusted EBITDA", a non-GAAP financial measure, is defined by
| Three Months Ended | ||||||||||||||||||||||||
| $ | Per share | $ |
Per share | $ | Per share | |||||||||||||||||||
| Net income | $ | 11,901 | $ | 0.43 | $ | 13,545 | $ | 0.48 | $ | 8,945 | $ | 0.30 | ||||||||||||
| Loss from discontinued operations, net of income taxes | — | — | — | — | (116 | ) | (0.01 | ) | ||||||||||||||||
| Income from continuing operations | $ | 11,901 | $ | 0.43 | $ | 13,545 | $ | 0.48 | $ | 9,061 | $ | 0.31 | ||||||||||||
| Depreciation & amortization | 2,429 | 0.09 | 2,579 | 0.09 | 2,503 | 0.09 | ||||||||||||||||||
| Stock-based compensation expense | 1,558 | 0.05 | 1,348 | 0.05 | 944 | 0.03 | ||||||||||||||||||
| Interest expense and other | 473 | 0.02 | 458 | 0.02 | 359 | 0.01 | ||||||||||||||||||
| Income tax expense | 8,195 | 0.29 | 9,067 | 0.32 | 5,327 | 0.18 | ||||||||||||||||||
| Adjusted EBITDA | $ | 24,556 | $ | 0.88 | $ | 26,997 | $ | 0.96 | $ | 18,194 | $ | 0.62 | ||||||||||||
| Weighted average shares outstanding - basic | 27,430 | 27,811 | 29,209 | |||||||||||||||||||||
| Weighted average shares outstanding - diluted | 27,793 | 28,132 | 29,460 | |||||||||||||||||||||
| Twelve Months Ended | ||||||||||||||||
|
| ||||||||||||||||
| $ | Per share | $ | Per share | |||||||||||||
| Net income | $ | 42,824 | $ | 1.52 | $ | 90,915 | $ | 2.87 | ||||||||
| Income from discontinued operations, net of income taxes | — | — | 61,517 | 1.94 | ||||||||||||
| Income from continuing operations | $ | 42,824 | $ | 1.52 | $ | 29,398 | $ | 0.93 | ||||||||
| Depreciation & amortization | 9,831 | 0.35 | 9,894 | 0.31 | ||||||||||||
| Stock-based compensation expense | 5,819 | 0.21 | 2,969 | 0.09 | ||||||||||||
| Interest expense and other | 1,960 | 0.07 | 1,396 | 0.04 | ||||||||||||
| Income tax expense | 28,848 | 1.02 | 18,559 | 0.59 | ||||||||||||
| Adjusted EBITDA | $ | 89,282 | $ | 3.17 | $ | 62,216 | $ | 1.96 | ||||||||
| Weighted average shares outstanding - basic | 27,910 | 31,475 | ||||||||||||||
| Weighted average shares outstanding - diluted | 28,190 | 31,691 | ||||||||||||||
Free Cash Flow
Free Cash Flow, a non-GAAP financial measure, is defined by
| Twelve Months Ended | ||||||||
| Net income | $ | 42,824 | $ | 90,915 | ||||
| Gain on sale of discontinued operations | — | (64,600 | ) | |||||
| Non-cash provisions and other | 21,602 | 15,376 | ||||||
| Changes in operating assets/liabilities | 5,754 | (67,273 | ) | |||||
| Capital expenditures | (8,328 | ) | (6,011 | ) | ||||
| Free cash flow | 61,852 | (31,593 | ) | |||||
| Proceeds from disposition of business | — | 117,887 | ||||||
| Change in debt | (12,861 | ) | 30,726 | |||||
| Repurchases of common stock | (38,471 | ) | (101,771 | ) | ||||
| Cash dividend | (12,545 | ) | (12,776 | ) | ||||
| Other | 2,284 | (2,110 | ) | |||||
| Change in cash | 259 | 363 | ||||||
AT THE FIRM Michael R. Blackman Chief Corporate Development Officer (813) 552-2927
News Provided by Acquire Media