Barrett Business Services, Inc. Announces Expectations of Lower Comparable Operating Results for Second Quarter of 2000

PORTLAND, Ore., July 20 /PRNewswire/ --

Barrett Business Services, Inc. (Nasdaq: BBSI) announced today that it expects

to report operating results for the second quarter ended June 30, 2000 that

are lower than those for the comparable 1999 quarter. The anticipated results

are attributable primarily to a slowing in the Company's revenue growth rate

compared to recent quarters, combined with higher workers' compensation

expense, depreciation and amortization, and interest expense.

The Company's revenue growth rate was affected by a new, comprehensive

pre-employment screening system, which helps ensure that applicants are

appropriately qualified. Although the new pre-employment screening system may

temporarily reduce revenues, management believes that in the long term the

system will enhance the quality of its employees and thus strengthen its

competitive position in a low unemployment economy. Management has increased

the Company's rates for services to reflect the continuing imbalance between

the demand for and supply of qualified employees for its customers.

The increase in workers' compensation expense over the same quarter a year

ago was due to an increase in the expected total costs of claims and an

increase in the number of claims. Higher comparable depreciation and

amortization expense was due to a May 1999 acquisition, combined with costs

associated with the Company's new information system, which was completed in

the first quarter of 2000. The increase in net interest expense was

attributable to higher debt levels necessary to finance three 1999

acquisitions.

Management expects the Company's net earnings per diluted share for the

second quarter ended June 30, 2000 to range from $.10 to $.12, as compared to

$.16 for the same quarter last year. The Company anticipates that its

second quarter 2000 operating results will be reported on August 2, 2000.

Barrett Business Services is a human resource management company with

offices in ten states. For 1999, Barrett reported net income of $5.1 million

and revenues of $347.9 million.

Statements above about future events or performance 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, and future workers' compensation

claims experience, among others. 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.
SOURCE Barrett Business Services, Inc.
Web site: http: //www.barrettbusiness.com
Company News On-Call: http: //www.prnewswire.com/comp/082187.html or fax, 800-758-5804, ext. 082187
CONTACT: William W. Sherertz, President and Chief Executive Officer of Barrett Business Services, Inc., 503-220-0988

Released July 20, 2000