General Employment Reports First Quarter Results

General Employment Reports First Quarter Results

OAKBROOK TERRACE, Ill., Feb. 22, 2011 /PRNewswire/ -- General Employment Enterprises, Inc. (NYSE Amex: JOB) reported consolidated net revenues for the quarter ended December 31, 2010 of $5,972,000, which increased by $4,000,000 (203%) from the same period last year and was primarily due to the acquisition of certain assets of On-Site ($2,377,000), RFFG of Cleveland ($485,000), DMCC ($450,000) and fees paid under the Management Agreement ($162,000), which contributed $3,474,000 in revenue for the period. Professional contract and placement services increased by $173,000 (12.3%) and $353,000 (61.9%) from the same period last year, respectively

The Company had a net income of $15,000 or $.00 per share, in the first quarter of this year, compared with a net loss of $589,000, or $.04 per share, in the first quarter last year.  For purposes of calculating the diluted earnings per-share amounts, the number of average common shares outstanding was 14,921,000 in the current quarter, compared with 13,380,000 in the prior-year quarter.

Commenting on the Company's performance, Salvatore J. Zizza, CEO, stated, "We have made substantial progress in our plan to return our Company to profitability and I am very pleased with the first quarter profit numbers reported above.  The turnaround in our performance over the first quarter of last year is a direct result of our strategy to grow the Company through acquisitions and I believe the foundation has been laid for future growth, both organically and through future acquisitions.  There is every indication that the economy and job market are improving and we have positioned General Employment to take advantage of an emerging job market."

Business Information

General Employment Enterprises, Inc. (the "Company") provides contract and placement staffing services for business and industry, primarily specializing in the placement of information technology, engineering and accounting professionals.  With the acquisition of certain of the assets of On-Site Services, Inc. ("On-Site") in June 2010, the Company also began to provide contract staffing services for the agricultural industry. This business is located in Florida and provides labor and human resource solutions, including temporary staffing, to the agricultural industry.  Effective November 1 2010, the Company and its wholly-owned subsidiary, Triad Personal Services, Inc an Illinois corporation, entered into an asset purchase agreement, with DMCC Staffing, LLC, an Ohio limited liability company ("DMCC"), RFFG of Cleveland, LLC, an Ohio limited liability company ("RFFG of Cleveland"), and Thomas J. Bean (the "Asset Purchase Agreement"), for the purchase of certain assets of DMCC and RFFG of Cleveland, including customer lists, comprising DMCC and RFFG of Cleveland's services business.  DMCC and RFFG of Cleveland's services business is operated from offices in Ohio and provides labor and human resource solutions, including temporary staffing, human resources and payroll outsourcing services, labor and employment consulting and workforce solutions. Currently, RFFG of Cleveland has one customer.  

Forward-Looking Statements

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, 2010, 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.



(In Thousands, Except Per Share)

                                             Three Months

                                             Ended December 31

                                               2010      2009

Net revenues:

Contract services                            $ 4,887   $ 1,402

Placement services                             923       570

Management services                            162       —

Net revenues                                   5,972     1,972

Cost of contract services                      4,115     996

Selling, general and administrative expenses   1735      1,547

Amortization of intangible assets              94        —

Income (loss) from operations                  28        (571)

Other expense, net                             (13)      (18)

Net income (loss)                            $ 15      $ (589)

Average number of shares - basic               14,917    13,380

Average number of shares - diluted             14,921    13,380

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



(In Thousands)

                                           December 31  September 30

                                            2010         2010


Cash and cash equivalents                   $ 243        $ 945

Other current assets                          3,364        1,635

Total current assets                          3,607        2,580

Property and equipment, net                   340          383

Goodwill                                      1,256        172

Intangible assets, net                        3,674        259

Total assets                                $ 8,877      $ 3,394

Liabilities and shareholders' equity:

Current liabilities                         $ 2,658      $ 1,371

Long-term obligations                         2,210        431

Shareholders' equity                          4,009        1,592

Total liabilities and shareholders' equity  $ 8,877      $ 3,394

SOURCE General Employment Enterprises, Inc.