Barrett Business Services, Inc. Announces Third Quarter 2003 Operating Results And Schedules Investor Conference Call
PORTLAND, Ore., Oct. 29 /PRNewswire-FirstCall/ -- Barrett Business
Services, Inc. (Nasdaq: BBSI) reported today net income of $943,000 for the
third quarter ended September 30, 2003, an improvement of $887,000 over net
income of $56,000 for the third quarter of 2002. The diluted income per share
for the 2003 third quarter was $.16, as compared to $.01 for the 2002 third
quarter.
Revenues for the third quarter ended September 30, 2003 totaled $34.8
million, an increase of approximately $4.7 million or 15.6% over the $30.1
million for the same quarter in 2002. Revenues for the nine months ended
September 30, 2003 amounted to $86.1 million, an increase of 3.0% over the
same period a year ago.
(Unaudited) (Unaudited)Third Quarter Ended Nine Months Ended
September 30, September 30,
Results of Operations 2003 2002 2003 2002
(in thousands, except
per share amounts)
Revenues:
Staffing services $26,727 $26,935 $69,883 $74,189
Professional
employer service
fees 8,046 3,155 16,189 9,405
Total revenues 34,773 30,090 86,072 83,594
Cost of revenues:
Direct payroll costs 19,740 20,032 51,617 54,841
Payroll taxes and
benefits 6,181 3,627 14,371 10,839
Workers'
compensation 2,501 2,058 5,908 5,402
Total cost of
revenues 28,422 25,717 71,896 71,082
Gross margin 6,351 4,373 14,176 12,512
Selling, general and
administrative
expenses 4,582 3,984 12,047 12,255
Depreciation and
amortization 256 282 807 882
Income (loss) from
operations 1,513 107 1,322 (625)
Other (expense)
income, net (62) (14) (136) 6
Income (loss)
before taxes 1,451 93 1,186 (619)
Provision for (benefit
from) income taxes 508 37 419 (259)
Net income (loss) $943 $56 $767 $(360)
Basic income (loss)
per share $.17 $.01 $.13 $(.06)
Weighted average basic
shares outstanding 5,645 5,804 5,700 5,810
Diluted income (loss)
per share $.16 $.01 $.13 $(.06)
Weighted average diluted
shares outstanding 5,927 5,816 5,805 5,810
The Company changed its reporting of PEO revenues from a gross basis to a
net basis in 2002 because it was determined that the Company was not the
primary obligor for the services provided by employees pursuant to its PEO
contracts. The gross revenues and cost of revenues information below,
although not in accordance with generally accepted accounting principles
("GAAP"), is presented for comparison purposes and because management believes
such information is more informative as to the level of the Company's business
activity and more useful in managing its operations.
(Unaudited) (Unaudited)Third Quarter Ended Nine Months Ended
($ in thousands) September 30, September 30,
2003 2002 2003 2002
Revenues:
Staffing services $26,727 $26,935 $69,883 $74,189
Professional
employer services 46,886 18,710 95,767 55,269
Total revenues 73,613 45,645 165,650 129,458
Cost of revenues:
Direct payroll costs 58,580 35,587 131,195 100,705
Payroll taxes and
benefits 6,181 3,627 14,371 10,839
Workers'
compensation 2,501 2,058 5,908 5,402
Total cost of
revenues 67,262 41,272 151,474 116,946
Gross margin $6,351 $4,373 $14,176 $12,512
A reconciliation of non-GAAP gross PEO revenues to net PEO revenues is as
follows:
For the third quarters ended September 30, 2003 and 2002 (in thousands):Gross Revenue Net Revenue
Reporting Method Reclassification Reporting Method
2003 2002 2003 2002 2003 2002
Revenues:
Staffing
services $26,727 $26,935 $-- $-- $26,727 $26,935
Professional
employer
services 46,886 18,710 (38,840) (15,555) 8,046 3,155
Total
revenues $73,613 $45,645 $(38,840) $(15,555) $34,773 $30,090
Cost of revenues:
Direct
payroll
costs $58,580 $35,587 $(38,840) $(15,555) $19,740 $20,032
For the nine months ended September 30, 2003 and 2002 (in thousands):
Gross Revenue Net Revenue
Reporting Method Reclassification Reporting Method
2003 2002 2003 2002 2003 2002
Revenues:
Staffing
services $69,883 $74,189 $-- $-- $69,883 $74,189
Professional
employer
services 95,767 55,269 (79,578) (45,864) 16,189 9,405
Total
revenues $165,650 $129,458 $(79,578) $(45,864) $86,072 $83,594
Cost of revenues:
Direct
payroll
costs $131,195 $100,705 $(79,578) $(45,864) $51,617 $54,841
William W. Sherertz, President and Chief Executive Officer, commented
that: "We are very pleased with our results for the third quarter and we
expect to generate comparable or better results for the 2003 fourth quarter."
The following summarizes the unaudited balance sheets at September 30,
2003 and December 31, 2002.
($ in thousands) September 30,
December 31,
2003 2002Assets
Current assets:
Cash and cash equivalents $450 $96
Income taxes receivable -- 1,923
Trade accounts receivable, net 18,449 11,357
Prepaid expenses and other 1,749 1,040
Deferred income taxes 1,658 2,111
Total current assets 22,306 16,527
Goodwill, net 18,749 18,749
Intangibles, net 23 59
Property, equipment and software, net 3,465 5,167
Restricted marketable securities and workers'
compensation deposits 4,063 4,286
Deferred income taxes 1,114 1,445
Other assets 482 1,064
$50,202 $47,297
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt $88 $434
Line of credit payable -- 3,513
Accounts payable 781 834
Accrued payroll, payroll taxes and related
benefits 12,933 4,897
Workers' compensation claims liabilities 1,749 3,903
Safety incentives payable 681 406
Other accrued liabilities 326 305
Current portion of deferred gain on sale
and leaseback 122 --
Total current liabilities 16,680 14,292
Long-term debt, net of current portion 400 488
Customer deposits 447 443
Long-term workers' compensation claims
liabilities 2,476 2,492
Other long-term liabilities 27 797
Long-term deferred gain on sale and leaseback 1,066 --
Stockholders' equity 29,106 28,785
$50,202 $47,297
On October 30, 2003 at 9:00 a.m. Pacific Time, William W. Sherertz and
Michael D. Mulholland will host an investor telephone conference call to
discuss third quarter 2003 operating results. To participate in the call,
dial 877-356-3717 shortly before 9:00 a.m. Pacific Time on October 30, 2003.
The call identification number is 3498751. A recording of the call will be
available beginning October 30, 2003 at 12:00 p.m. and ending Thursday,
November 6, 2003. To listen to the recording, dial 800-642-1687 and enter
conference identification code 3498751.
Barrett Business Services, Inc. is a human resource management company
with offices in seven states, which serve customers in approximately 15
states.
Statements in this release about future events or performance, including
earnings expectations for the remaining one quarter of 2003, 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 October 29, 2003