General Employment Reports Third Quarter Results
OAKBROOK TERRACE, Ill., Aug. 16 /PRNewswire-FirstCall/ -- General Employment Enterprises, Inc. (NYSE Amex: JOB) reported consolidated net revenues for the quarter ended June 30, 2010 of $3,836,000, which increased 52% compared with consolidated net revenues of $2,520,000 reported for the same period last year. Contract service revenues for the quarter $2,982,000 increased 100% from the same period last year primarily due to $1,376,000 of revenue from the On-Site Service acquisition and a 14.5% increase in the average hourly rate. Placement service revenues of $854,000 decreased 17% from last year.
The Company had a net loss of $137,000 or $.01 per share, in the third quarter of this year, compared with a net loss of $2,295,000, or $.44 per share, in the third quarter last year. For purposes of calculating the per-share amounts, the weighted average number common shares outstanding 13,867,000 in the current quarter, compared with 5,165,000 in the prior-year quarter.
Commenting on the Company's performance, Salvatore J. Zizza, CEO said, "We believe the acquisition of On-Services and the recent increase in contract revenue, along with our continued efforts at cost control, will show improvement in our bottom line."
Nine Months Results
For the nine months ended June 30, 2010, the Company had a net loss of $1,426,000, or $.11 per share, compared with a net loss of $4,159,000 or $.81 per share, for the same period last year. Consolidated net revenues for the nine-month period of $7,836,000, were relatively flat compared to last year.
General Employment provides professional staffing services, and specializes in information technology, accounting and engineering placements.
The Company's business is highly dependent on national employment trends in general and on the demand for professional staff in particular. Because long-term contracts are not a significant part of the Company's business, future results cannot be reliably predicted by considering past trends or by extrapolating past results. Some of the factors that could affect the Company's future performance include, but are not limited to, general business conditions, the demand for the Company's services, competitive market pressures, the ability of the Company to attract and retain qualified personnel for regular full-time placement and contract assignments, the possibility of incurring liability for the Company's business activities, including the activities of contract employees and events affecting its contract employees on client premises, and the ability of the Company to attract and retain qualified corporate and branch management.
The statements made in this press release which are not historical facts are forward-looking statements. Such forward-looking statements often contain or are prefaced by words such as "will" and "expect." As a result of a number of factors, our actual results could differ materially from those set forth in the forward-looking statements. Certain factors that might cause our actual results to differ materially from those in the forward-looking statements include, without limitation, those factors set forth under the heading "Forward-Looking Statements" in our annual report on Form 10-K for the fiscal year ended September 30, 2009, and in our other filings with the SEC. General Employment is under no obligation to (and expressly disclaims any such obligation to) and does not intend to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
GENERAL EMPLOYMENT ENTERPRISES, INC. CONSOLIDATED STATEMENT OF OPERATIONS (In Thousands, Except Per Share) Three Month Nine Months Ended June 30 Ended June 30 2010 2009 2010 2009 Net revenues: Contract services $ 2,982 $ 1,490 $ 5,840 $ 4,433 Placement services 854 1,030 1,996 3,446 Net revenues 3,836 2,520 7,836 7,879 Cost of contract services 2,445 1,040 4,500 3,093 Selling, general and administrative expenses (1) 1,519 3,809 4,726 8,895 Loss from operations (128) (2,329) (1,390) (4,109) Other expense (9) 34 (36) (50) Net loss (2) $ (137) $ (2,295) $ (1,426) $ (4,159) Average number of shares - basic and diluted 13,867 5,165 13,542 5,165 Net loss per share - basic and diluted $ (.01) $ (.44) $ (.11) $ (.81)
(1) Selling, general and administrative expenses for the nine months ended June 30, 2010 include $100,000 in legal fees, primarily for the proposed purchase of GT Systems, Inc. an acquisition that didn't take place. (2) There were no credits for income taxes as a result of the pretax losses during the periods, because there was not sufficient assurance that the future tax benefits would be realized.
GENERAL EMPLOYMENT ENTERPRISES, INC. SUMMARIZED CONSOLIDATED BALANCE SHEET INFORMATION (In Thousands) June 30 September 30 2010 2009 Assets: Cash and cash equivalents $ 555 $ 2,810 Accounts Receivables 2,130 1,038 Other current assets 281 249 Total current assets 2,966 4,097 Property and equipment, net 423 570 Other assets 469 — Total assets $ 3,858 $ 4,667 Liabilities and shareholders' equity: Current liabilities $ 1,669 $ 1,488 Long-term obligations 468 575 Shareholders' equity 1,721 2,604 Total liabilities and shareholders' equity $ 3,858 $ 4,667
SOURCE General Employment Enterprises, Inc.
Released August 16, 2010