Barrett Business Services, Inc. Announces Net Income and Revenues for Third Quarter 1998
PORTLAND, Ore., Nov. 4 /PRNewswire/ -- Barrett Business Services, Inc.
(Nasdaq: BBSI) reported today net income of $1,599,000 for the third quarter
ended September 30, 1998, an increase of $623,000 or 63.8% over the third
quarter of 1997. Basic and diluted earnings per share for the 1998 third
quarter were $.21, compared to $.13 for both basic and diluted earnings per
share for the same quarter of 1997. Net income for the nine months ended
September 30, 1998 amounted to $2,586,000. Basic and diluted earnings per
share for the 1998 nine-month period were $.34, compared to $.40 for basic and
$.39 for diluted earnings per share for the 1997 period.
Revenues for the third quarter ended September 30, 1998 totaled
$82.0 million, a decrease of approximately $4.0 million or 4.7% from the
$86.0 million for the same quarter a year ago. Revenues for the nine months
ended September 30, 1998 were $227.9 million, a decrease of 0.4% from the
comparable 1997 period.
William W. Sherertz, President and Chief Executive Officer, commented
that: "We are pleased with the favorable impact on earnings of our recently
implemented zone management practices and tighter operating controls. Our
earnings on a per share basis equaled a record level set two years ago. It is
important to note that our revenue trend is not a company-wide issue and is
confined to a few larger branch offices. The decline reflects a very limited
number of large customers which have been affected by various economic
conditions."
As previously reported, effective June 29, 1998, Barrett completed its
acquisition of Western Industrial Management, Inc., and of a related company,
Catch 55, Inc. (together "WIMI"), in a stock-for-stock merger. The merger
with WIMI has been accounted for as a pooling-of-interests under Accounting
Principles Board Opinion No. 16, and accordingly, all prior period financial
statements have been restated to include WIMI as though it had always been a
part of Barrett.
(Unaudited) (Unaudited)Third Quarter Nine Months
Ended Ended
September 30, September 30,
Results of Operations 1998 1997 1998 1997
(in thousands, except
per share amounts)
Revenues:
Staffing services $44,199 $51,957 $127,289 $132,093
Professional employer
services 37,770 34,038 100,572 96,573
Total revenues 81,969 85,995 227,861 228,666
Cost of revenues:
Direct payroll costs 63,768 66,717 176,783 176,504
Payroll taxes and benefits 6,587 7,588 19,656 20,853
Workers' compensation 2,201 2,489 6,408 6,715
Safety incentives 446 464 1,146 1,168
Total cost of revenues 73,002 77,258 203,993 205,240
Gross margin 8,967 8,737 23,868 23,426
Selling, general
and administrative
expenses 5,826 6,888 17,677 17,638
Merger expenses -- -- 750 --
Amortization of intangibles 322 361 1,004 973
Income from operations 2,819 1,488 4,437 4,815
Other income 68 -- 178 83
Income before taxes 2,887 1,488 4,615 4,898
Provision for income taxes 1,288 512 2,029 1,845
Net income $ 1,599 $976 $2,586 $3,053
Basic earnings per share $.21 $.13 $.34 $.40
Weighted average number
of basic shares outstanding 7,675 7,622 7,660 7,649
Diluted earnings per share $.21 $.13 $.34 $.39
Weighted average
number of diluted
shares outstanding 7,714 7,794 7,710 7,804
The following summarizes the unaudited balance sheets at September 30,
1998 and December 31, 1997, as restated:
($ in thousands)September 30, December 31,
1998 1997
Assets
Cash $4,378 $3,439
Receivables, net 24,090 21,051
Prepaids and other 2,193 1,231
Deferred tax asset 2,300 2,086
Total current assets 32,961 27,807
Intangibles, net 11,815 12,133
Property and equipment, net 5,076 4,574
Restricted marketable
securities 5,827 6,095
Other assets 403 206
$56,082 $50,815
Liabilities and Stockholders'
Equity
Current portion of long-term debt $398 $731
Line of credit payable -- 887
Income taxes payable 516 --
Accounts payable 484 1,136
Accrued payroll and benefits 13,773 10,034
Accrued workers' compensation claims 3,416 3,140
Customer safety incentives 1,198 1,073
Other accrued liabilities 694 414
Total current liabilities 20,479 17,415
Long-term debt, net 445 573
Customer deposits 869 934
Long-term workers' compensation
liabilities 625 632
Other long-term liabilities 1,198 1,030
Stockholders' equity 32,466 30,231
$56,082 $50,815
Barrett Business Services, Inc. is a human resource management company
with offices in Washington, Oregon, Idaho, California, Arizona, Michigan,
Maryland and Delaware. For 1997, as restated, Barrett reported revenues of
$305.5 million and net income of $3.8 million.
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 November 4, 1998