Barrett Business Services, Inc. Announces Fourth Quarter 2003 Operating Results and Schedules Investor Conference Call
PORTLAND, Ore., Feb. 5 /PRNewswire-FirstCall/ -- Barrett Business
Services, Inc. (Nasdaq: BBSI) reported today net income of $1,318,000 for the
fourth quarter ended December 31, 2003, an improvement of $2.3 million over a
net loss of $993,000 for the fourth quarter of 2002. Diluted income per share
for the 2003 fourth quarter was $.22, as compared to a diluted loss per share
of $(.17) for the 2002 fourth quarter.
Net revenues for the fourth quarter ended December 31, 2003 totaled $36.6
million, an increase of approximately $10.9 million or 42.5% over the $25.7
million for the same quarter in 2002. Total net revenues for 2003 amounted to
$122.7 million, an increase of 12.3% over 2002.
(Unaudited) (Unaudited)Fourth Quarter Ended Year Ended
December 31, December 31,
Results of Operations 2003 2002 2003 2002
(in thousands, except
per share amounts)
Revenues:
Staffing services $ 23,661 $ 22,561 $ 93,544 $ 96,750
Professional
employer service
fees 12,988 3,153 29,177 12,558
Total revenues 36,649 25,714 122,721 109,308
Cost of revenues:
Direct payroll costs 17,482 16,674 69,099 71,515
Payroll taxes and
benefits 8,545 3,223 22,916 14,062
Workers' compensation 3,425 3,364 9,333 8,766
Total cost of
revenues 29,452 23,261 101,348 94,343
Gross margin 7,197 2,453 21,373 14,965
Selling, general and
administrative
expenses 5,139 3,753 17,186 16,008
Depreciation and
amortization 251 280 1,058 1,162
Income (loss) from
operations 1,807 (1,580) 3,129 (2,205)
Other (expense)
income, net (18) (46) (154) (40)
Income (loss) before
taxes 1,789 (1,626) 2,975 (2,245)
Provision for (benefit
from) income taxes 471 (633) 890 (892)
Net income (loss) $1,318 $(993) $2,085 $ (1,353)
Basic income (loss)
per share $.23 $(.17) $.36 $(.23)
Weighted average basic
shares outstanding 5,660 5,787 5,690 5,804
Diluted income (loss)
per share $.22 $(.17) $.35 $(.23)
Weighted average diluted
shares outstanding 6,088 5,787 5,876 5,804
The Company changed its reporting of PEO revenues from a gross basis to a
net basis in 2002 because it was determined that the Company was not the
primary obligor for the services provided by employees pursuant to its PEO
contracts. The gross revenues and cost of revenues information below,
although not in accordance with generally accepted accounting principles
("GAAP"), is presented for comparison purposes and because management believes
such information is more informative as to the level of the Company's business
activity and more useful in managing its operations.
(Unaudited) (Unaudited)Fourth Quarter Ended Year Ended
($ in thousands) December 31, December 31,
2003 2002 2003 2002
Revenues:
Staffing services $23,661 $22,561 $93,544 $96,750
Professional
employer services 77,366 18,683 173,134 73,952
Total revenues $101,027 $ 41,244 $266,678 $170,702
Cost of revenues:
Direct payroll
costs $ 80,510 $ 32,204 $210,785 $132,909
Payroll taxes
and benefits 8,545 3,223 22,916 14,062
Workers' compensation 4,775 3,364 11,604 8,766
Total cost of
revenues 93,830 38,791 245,305 155,737
Gross margin $7,197 $2,453 $ 21,373 $14,965
A reconciliation of non-GAAP gross revenues to net revenues is as follows:
For the fourth quarters ended December 31, 2003 and 2002 (in thousands):
Gross Revenue Net Revenue
Reporting Method Reclassification Reporting Method
2003 2002 2003 2002 2003 2002
Revenues:
Staffing
services $23,661 $22,561 $-- $-- $23,661 $22,561
Professional
employer
services 77,366 18,683 (64,378) (15,530) 12,988 3,153
Total
revenues $101,027 $41,244 $(64,378) $(15,530) $36,649 $25,714
Cost of
revenues: $93,830 $38,791 $(64,378) $(15,530) $29,452 $23,261
For the years ended December 31, 2003 and 2002 (in thousands):
Gross Revenue Net Revenue
Reporting Method Reclassification Reporting Method
2003 2002 2003 2002 2003 2002
Revenues:
Staffing
services $93,544 $96,750 $-- $-- $93,544 $96,750
Professional
employer
services 173,134 73,952 (143,957) (61,394) 29,177 12,558
Total
revenues $266,678 $170,702 $(143,957) $(61,394) $122,721 $109,308
Cost of
revenues: $245,305 $155,737 $(143,957) $(61,394) $101,348 $94,343
William W. Sherertz, President and Chief Executive Officer, commented
that: "We are very pleased with achieving a new milestone for the Company with
$101 million in total gross revenues for the fourth quarter. We believe that
the momentum generated by our expanding customer base portends improved
operating results in 2004."
The following summarizes the unaudited balance sheets at December 31, 2003
and December 31, 2002.
($ in thousands) December 31, December 31,2003 2002
Assets
Current assets:
Cash and cash equivalents $7,785 $96
Income taxes receivable -- 1,923
Trade accounts receivable, net 18,381 11,357
Prepaid expenses and other 958 1,040
Deferred income taxes 2,125 2,111
Total current assets 29,249 16,527
Goodwill, net 18,749 18,749
Intangibles, net 13 59
Property, equipment and software, net 3,367 5,167
Restricted marketable securities and workers'
compensation deposits 1,647 4,286
Deferred income taxes 1,041 1,445
Other assets 436 1,064
$54,502 $47,297
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt $88 $434
Line of credit payable -- 3,513
Income taxes payable 297 --
Accounts payable 727 834
Accrued payroll, payroll taxes and related
benefits 13,881 4,897
Workers' compensation claims liabilities 3,555 3,903
Safety incentives payable 2,007 406
Other accrued liabilities 361 305
Current portion of deferred gain on sale
and leaseback 122 --
Total current liabilities 21,038 14,292
Long-term debt, net of current portion 400 488
Customer deposits 455 443
Long-term workers' compensation claims
liabilities 1,031 2,492
Other long-term liabilities 45 797
Long-term deferred gain on sale and leaseback 1,036 --
Stockholders' equity 30,497 28,785
$54,502 $47,297
On February 6, 2004 at 9:00 a.m. Pacific Time, William W. Sherertz and
Michael D. Mulholland will host an investor telephone conference call to
discuss fourth quarter 2003 operating results. To participate in the call,
dial 877-356-3717 shortly before 9:00 a.m. Pacific Time on February 6, 2004.
The call identification number is 5399009. A recording of the call will be
available beginning February 6, 2004 at 11:00 a.m. and ending February 13,
2004. To listen to the recording, dial 800-642-1687 and enter conference
identification code 5399009.
Barrett Business Services, Inc. is a human resource management company
with offices in eight states, which serve customers in approximately 18
states.
Statements in this release about future events or performance, including
earnings expectations for 2004, are forward-looking statements, which involve
known and unknown risks, uncertainties and other factors that may cause the
actual results of the Company to be materially different from any future
results expressed or implied by such forward-looking statements. Factors that
could affect future results include economic conditions in the Company's
service areas, the effect of changes in the Company's mix of services on gross
margin, future workers' compensation claims experience, collectibility of
accounts receivable, and availability of funding for working capital purposes,
among others. Other important factors that may affect the Company's future
prospects are described in the Company's 2002 Annual Report on Form 10-K.
Although forward-looking statements help to provide complete information about
the Company, readers should keep in mind that forward-looking statements may
be less reliable than historical information. The Company undertakes no
obligation to update or revise forward-looking statements in this release to
reflect events or changes in circumstances that occur after the date of this
release.
SOURCE Barrett Business Services, Inc.
Released February 5, 2004