General Employment Reports First Quarter Results

General Employment Reports First Quarter Results

OAKBROOK TERRACE, Ill., Jan 29 /PRNewswire-FirstCall/ -- General Employment Enterprises, Inc. (Amex: JOB) reported consolidated net revenues for the quarter ended December 31, 2007 of $3,964,000, compared with revenues of $4,844,000 reported for the same period last year.

Placement services revenues for the quarter were $2,162,000, down 18% from the same period last year. Contract service revenues of $1,802,000, decreased 18% from $2,200,000 last year.

As a result of the lower revenues, the Company had a net loss of $227,000, or $.04 per share, in the first fiscal quarter of this year, compared with net income of $296,000, or $.06 per share, last year.

Commenting on the Company's performance, Herbert F. Imhoff, Jr., board chairman and CEO said, "The declining first quarter revenues and the resulting net loss were disappointments for the Company and reflect a general slowing of the economy."

Mr. Imhoff continued, "National statistics indicate that job creation was down, unemployment was up and credit was tightening. I believe many of our prospects and clients decided to delay hiring decisions, evaluating the economy and its potential impact on their own companies before moving forward. We also found it difficult to recruit enough well-qualified candidates, in large part because of the uncertain economy."

Business Information

General Employment provides professional staffing services through a network of 20 branch offices located in 9 states, 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.

                       (In Thousands, Except Per Share)

                                                             Three Months
                                                           Ended December 31
                                                             2007      2006

     Net revenues:
       Contract services                                    $1,802    $2,200
       Placement services                                    2,162     2,644
       Net revenues                                          3,964     4,844

     Operating expenses:
       Cost of contract services                             1,235     1,476
       Selling                                               1,375     1,604
       General and administrative                            1,631     1,551
       Total operating expenses                              4,241     4,631

     Income (loss) from operations                            (277)      213
     Investment income                                          50        83

     Net income (loss)(1)                                   $ (227)   $  296

     Average number of shares:
       Basic                                                 5,159     5,148
       Diluted                                               5,159     5,334

     Net income (loss) per share -
       basic and diluted                                    $ (.04)   $  .06

     (1) There was no credit for income taxes as a result of the pretax losses
         in the 2007 period, because there was not sufficient assurance that a
         future tax benefit would be realized.  There was no provision for
         income taxes in the 2006 period because of the availability of
         operating losses carried forward from prior years.

                                (In Thousands)
                                                    December 31  September 30
                                                       2007          2007

       Cash and cash equivalents                      $5,759        $6,344
       Other current assets                            1,782         2,167

       Total current assets                            7,541         8,511
       Property and equipment, net                       914           929
       Other assets                                      446           436

       Total assets                                   $8,901        $9,876

     Liabilities and shareholders' equity:
       Current liabilities                            $1,849        $2,116
       Other liabilities                                 446           436
       Shareholders' equity (2)                        6,606         7,324

       Total liabilities and shareholders' equity     $8,901        $9,876

     (2) During the quarter ended December 31, 2007, the board of directors
         declared a cash dividend of $.10 per common share, resulting in a
         $517,000 charge to retained earnings during the period.

SOURCE General Employment Enterprises, Inc.