Kforce Reports Revenues of $270.2 Million and EPS of $0.26 for the Third Quarter of 2012

Kforce Reports Revenues of $270.2 Million and EPS of $0.26 for the Third
Quarter of 2012

Net Income and EPS From Continuing Operations up 46.6% and 52.9%

TAMPA, Fla., Oct. 30, 2012 (GLOBE NEWSWIRE) -- Kforce Inc. (Nasdaq:KFRC), a
provider of professional staffing services and solutions, today announced
results for its third quarter of 2012. Revenues from continuing operations for
the quarter ended September 30, 2012 were $270.2 million compared to $274.1
million for the quarter ended June 30, 2012, a decrease of 1.4% and compared
to $261.0 million for the quarter ended September 30, 2011, an increase of
3.5%. In the quarter ended September 30, 2012, Kforce reported net income of
$9.3 million, or $0.26 per share, versus $8.9 million, or $0.24 per share,
excluding the goodwill impairment charge, for the quarter ended June 30, 2012.
Net income and earnings per share for the third quarter of 2012 increased 9.7%
and 18.2%, respectively, versus net income of $8.4 million, or $0.22 per
share, for the third quarter of 2011. Net income and earnings per share from
continuing operations for the quarter ended September 30, 2012 of $9.3 million
and $0.26 per share, respectively, increased 46.6% and 52.9%, respectively,
from $6.3 million, or $0.17 per share, for the quarter ended September 30,
2011.

David L. Dunkel, Chairman and CEO, said, "We are pleased with our Q3 '12
results as Kforce reported revenues for the quarter of $270.2 million and
earnings per share of $0.26.The environment for professional staffing and the
demand for our services, particularly in technology staffing, continues to be
positive.Over the past few quarters, however, revenue growth has slowed as
the uncertain economic outlook is dampening demand. The unemployment rate
among college-degreed workers is roughly half that of the overall U.S. rate of
unemployment, and is substantially lower in several of the skill sets in which
Kforce specializes. We continue to see bill rates increase as supply for
highly skilled candidates remains tight. We believe our diverse service
offerings and highly elastic front and back office platforms position Kforce
well to navigate through the significant uncertainties that exist in the
macroeconomic environment. I want to thank all of our employees, consultants
and clients for making Q3 '12 another successful quarter for Kforce."

William L. Sanders, President, said, "The Firm continued its solid performance
in the third quarter of 2012, where we experienced a flex margin increase of
30 basis points sequentially and 40 basis points year-over-year, which was
primarily driven by the increase in the spread between bill and pay rates for
our Tech segment, which is our largest segment. We intend to continue to
aggressively manage our client portfolio to optimize both volume and rate.
During the third quarter, we were able to continue to take advantage of our
highly advanced sales and delivery platform that leverages our field
associates, Strategic Accounts strategy and the National Recruiting Center to
profitably grow revenues with both large and small clients. Discussions with
our clients and certain key performance indicators indicate demand for
temporary staffing to be stable, though growth is being impacted by prolonged
decision making from our clients as well as an increase in conversions. Kforce
continues to aggressively pursue business opportunities with the goal of
continuing to gain client and market share."

Mr. Sanders noted additional operational results for the third quarter
include:

  *Flex revenues from continuing operations of $257.8 million in Q3 '12
    decreased 1.2% from $260.9 million in Q2 '12 and increased 3.4% from
    $249.4 million in Q3 '11.
  *Search revenues from continuing operations of $12.4 million in Q3 '12
    decreased 6.3% from $13.2 million in Q2 '12 and increased 6.6% from $11.6
    million in Q3 '11.
  *Sequential percentage changes in Flex revenues from continuing operations
    on a billing day basis by segment were: 1.2% increase for Tech, 2.0%
    decrease for FA, 7.1% decrease for HIM and a 6.8% increase for Government
    Solutions.
  *Year-over-year changes in Flex revenues from continuing operations on a
    billing day basis were a 4.8% increase in Tech, 9.2% increase in FA, 6.7%
    increase in HIM and a 3.5% decrease in Government Solutions.

Joseph J. Liberatore, Chief Financial Officer, said, "The Firm continued to
perform well in Q3 '12. Q3 '12 contained 63 billing days while Q2 '12 and Q3
'11 each contained 64 billing days. The Firm has continued to improve earnings
in this environment by improving bill/pay spreads through continued selective
investments in its stronger products and markets and by generating operating
leverage through efficiencies and scale. We expect modest revenue growth and
Flex gross margin expansion in the near term and believe operating
efficiencies will result in continued improvements in operating margins. We
will continue to focus on execution in all aspects of our business including
improving client relationships, solid expense management and continued
efficiencies."

Financial highlights for the third quarter include:

  *Flex gross profit from continuing operations increased 30 basis points to
    29.6% in Q3 '12 from 29.3% in Q2 '12 and increased 40 basis points from
    29.2% in Q3 '11.
  *Selling, general and administrative expenses as a percentage of revenues
    decreased to 26.0% in Q3 '12 from 26.1% in Q2 '12 and from 27.3% in Q3
    '11.
  *There was no bank debt at the end of Q3 '12 (and $5.4 million in cash and
    cash equivalents) compared to $11.0 million at the end of Q2 '12.
  *Earnings per share in Q3 '12 was $0.26 per share, an increase of 8.3% from
    $0.24 per share in Q2 '12, before the impact of the Q2 '12 goodwill
    impairment charge, and an increase of 18.2% from $0.22 in Q3 '11.

Mr. Liberatore stated, "In addition, looking forward to the fourth quarter of
2012, we expect revenues may be in the $267 million to $273 million range and
earnings per share in the range of $0.22 to $0.24. The fourth quarter of 2012
has 62 billing days, one less than the third quarter of 2012. This guidance
does not factor the potentially significant impact from the still unfolding
dynamics as a result of Hurricane Sandy. Approximately 30% of Kforce revenue
is derived from the Mid Atlantic - Northeast corridor."

On Tuesday, October 30, 2012, Kforce will host a conference call to discuss
these results. The call will begin at 5:00 p.m. Eastern Time.

The dial-in number is (877) 344-3890.The conference passcode is Kforce.The
replay of the call will be available from 8:00 p.m. EDT, Wednesday, October
31, 2012 through November 14, 2012 by dialing (855) 859-2056, passcode
43182940.

This call is being webcast by Shareholder.com and can be accessed at Kforce's
web site at www.kforce.com (select "Investor Relations").The webcast replay
will be available until November 14, 2012.

About Kforce

Kforce (Nasdaq:KFRC) is a professional staffing and solutions firm providing
flexible and permanent staffing solutions in the skill areas of technology,
finance& accounting, and health information management. Backed by more than
2,300 associates and approximately 10,500 consultants on assignment, Kforce is
committed to "Great People = Great Results" for our valued clients and
candidates. Kforce operates with 63 offices located throughout the United
States and one office in the Philippines. For more information, please visit
our Web site at http://www.kforce.com.

The Kforce Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=3749.

Certain of the above statements contained in this press release are
forward-looking statements that involve a number of risks and uncertainties.
Such forward-looking statements are within the meaning of that term in
Section27A of the Securities Act of 1933, as amended, and Section21E of the
Securities Exchange Act of 1934, as amended. Factors that could cause actual
results to differ materially include the following: business conditions and
growth in the staffing industry and general economy; competitive factors,
risks due to shifts in the market demand, including, without limitation,
shifts in demand for our Technology, Finance and Accounting, Health
Information Management and Government Solutions segments, as well as the
market for search and flexible staffing assignments; changes in the service
mix; ability of the Firm to complete acquisitions; and the risk factors listed
from time to time in the Firm's reports filed with the Securities and Exchange
Commission, as well as assumptions regarding the foregoing. In particular,
there can be no assurance that we will continue to increase our market share,
successfully manage risks to our revenue stream and successfully put into
place the people and processes that will create future success. The words
"should," "believe," "estimate," "expect," "intend," "anticipate," "foresee,"
"plan" and similar expressions and variations thereof identify certain of such
forward-looking statements, which speak only as of the dates on which they
were made. The Firm undertakes no obligation to publicly update or revise any
forward-looking statements. As a result, such forward looking statements are
not guarantees of future performance and involve risks and uncertainties, and
actual results may differ materially from those indicated in the
forward-looking statements as a result of various factors. Readers are
cautioned not to place undue reliance on these forward-looking statements.


Kforce Inc.
Summary of Operations
(In Thousands, Except Per Share Amounts)
(Unaudited)
                                                                 
                                            Three Months Ended
                                                                 
                                            Sept. 30,  June 30,    Sept. 30,
                                             2012       2012        2011
                                                                 
Revenue by function:                                              
Technology                                  $170,577 $171,739  $165,476
Finance & accounting                        58,729    60,867     54,297
Health information management               18,157    19,978     17,370
Government solutions                        22,698    21,545     23,881
Total revenue                                270,161    274,129     261,024
                                                                 
Costs of services                            181,399    184,363     176,520
Gross profit                                 88,762    89,766     84,504
GP %                                         32.9%      32.7%       32.4%
Flex GP %                                    29.6%      29.3%       29.2%
                                                                 
Selling, general & administrative expenses   70,367     71,414     71,244
Goodwill impairment                          --       65,300     --
Depreciation & amortization                  2,659      2,877      3,010
                                                                 
Income (loss) from operations                15,736     (49,825)    10,250
                                                                 
Other expense, net                           288        265         286
                                                                 
Income (loss) from continuing operations     15,448     (50,090)    9,964
before income taxes
                                                                 
Income tax expense (benefit)                6,173      (16,908)    3,638
                                                                 
Income (loss) from continuing operations     $9,275   $(33,182) $6,326
                                                                 
(Loss) income from discontinued operations,  (7)       15         2,120
net of income taxes
                                                                 
Net income (loss)                            $9,268   $(33,167) $8,446
                                                                 
Earnings (loss) per share - diluted          $0.26    $(0.90)   $0.22
Adjusted EBITDA per share                    $0.51    $0.50     $0.43
Shares outstanding - diluted                36,243     36,712      38,228
                                                                 
Adjusted EBITDA                             $18,415  $18,325   $16,400
                                                                 
Other information:                                                
Capital expenditures                         $1,568   $2,519    $2,113
Equity-based compensation expense, net       $23      $--      $1,938
Working capital                              $98,199  $105,436  $100,766
                                                                 
Selected balance sheet information:                                
Cash and cash equivalents                    $5,418   $812      $1,025
Accounts receivable, less allowances         $168,954 $179,408  $186,843
Total assets                                 $352,722 $369,467  $420,397
Bank debt                                    $--     $10,992   $59,384
Total liabilities                            $135,985 $153,128  $193,747
Total stockholders' equity                   $216,737 $216,339  $226,650
                                                                 
Billing days                                 63         64         64

                                                       
                               Kforce Inc.              
                               Key Statistics           
                               (Unaudited)              
                                                       
                               Q3 2012        Q2 2012    Q3 2011
                                                       
Total Firm                                              
Flex revenue (000's)            $257,790     $260,925 $249,420
Revenue per billing day (000's) $4,092       $4,077   $3,897
Sequential flex revenue change  -1.2%          1.4%       5.7%
Hours (000's)                   4,328         4,411     4,189
Flex GP %                       29.6%          29.3%      29.2%
                                                       
Search revenue (000's)          $12,371      $13,204  $11,604
Placements                     856           956       874
Average fee                     $14,456      $13,817  $13,276
Billing days                    63            64        64
                                                       
Technology                                              
Flex revenue (000's)            $165,342     $166,044 $160,285
Revenue per billing day (000's) $2,625       $2,594   $2,504
Sequential flex revenue change  -0.4%          3.5%       6.9%
Hours (000's)                   2,520         2,532     2,520
Flex GP %                       28.4%          27.9%      27.7%
                                                       
Search revenue (000's)          $5,235       $5,695   $5,191
Placements                     337           354       354
Average fee                     $15,536      $16,076  $14,682
                                                       
Finance & Accounting                                    
Flex revenue (000's)            $51,661      $53,562  $48,046
Revenue per billing day (000's) $820         $837     $751
Sequential flex revenue change  -3.5%          -2.0%      1.1%
Hours (000's)                   1,545         1,585     1,406
Flex GP %                       30.9%          31.0%      30.1%
                                                       
Search revenue (000's)          $7,068       $7,305   $6,251
Placements                     513           593       499
Average fee                     $13,783      $12,330  $12,516
                                                       
Health Information Management                           
Flex revenue (000's)            $18,089      $19,774  $17,208
Revenue per billing day (000's) $287         $309     $269
Sequential flex revenue change  -8.5%          2.3%       3.7%
Hours (000's)                   263           294       263
Flex GP %                       35.9%          36.5%      36.6%
                                                       
Search revenue (000's)          $68          $204     $162
Placements                      6             9         21
Average fee                     $11,384      $22,739  $7,678
                                                       
Government Solutions                                    
Flex revenue (000's)            $22,698      $21,545  $23,881
Revenue per billing day (000's) $360         $337     $373
Sequential flex revenue change  5.4%           -6.3%      8.8%
Flex GP %                       30.5%          30.0%      32.3%

Kforce Inc.
Selected Financial Information and Reconciliations
(In Thousands, Except Per Share Amounts)
(Unaudited)
                                                                 
Quarterly Adjusted EBITDA
                Three Months Ended
                Sept. 30,           June 30,                Sept. 30,
                 2012                2012                    2011
                $          Per      $            Per share  $         Per
                            share                                      share
                                                                 
Net income       $9,268   $0.26  $(33,167)  $(0.90)  $8,446  $0.22
(loss)
(Loss) income
from
discontinued     (7)        (0.00)  15           0.00       2,120     0.05
operations, net
of income taxes
Income (loss)
from continuing  $9,275   $0.26  $(33,182)  $(0.90)  $6,326  $0.17
operations
Goodwill
impairment,      --       --     65,300      1.77      --      --
pre-tax
Depreciation &   2,659     0.07    2,877       0.08      3,010    0.07
amortization
Amortization of
restricted stock 38        0.00    --         --       3,048    0.08
& PARS
Interest expense 270       0.01    238         0.01      378      0.01
and other
Income tax
expense          6,173     0.17    (16,908)    (0.46)    3,638    0.10
(benefit)
Adjusted EBITDA  $18,415  $0.51  $18,325    $0.50    $16,400 $0.43
                                                                 
Weighted average
shares           36,204            36,712                37,417   
outstanding -
basic
Weighted average
shares           36,243            36,807                38,228   
outstanding -
diluted
                                                                 
Adjusted EBITDA, a non-GAAP financial measure, is defined as earnings before
discontinued operations, non-cash impairment charges, interest, income taxes,
depreciation and amortization and stock-based compensation expense.Adjusted
EBITDA should not be considered a measure of financial performance under
generally accepted accounting principles.Items excluded from Adjusted EBITDA
are significant components in understanding and assessing financial
performance.
                                                                 
Quarterly Net Income before Equity-Based Compensation Expense and Impairment
Charge
                                                                 
                Three Months Ended
                Sept. 30,           June 30,                Sept. 30,
                 2012                2012                    2011
                $          Per      $            Per share  $         Per
                            share                                      share
                                                                 
Net income       $9,268   $0.26  $(33,167)  $(0.90)  $8,446  $0.22
(loss)
(Loss) income
from
discontinued     (7)        (0.00)  15           0.00       2,120     0.05
operations, net
of income taxes
Income (loss)
from continuing  $9,275   $0.26  $(33,182)  $(0.90)  $6,326  $0.17
operations
Goodwill
impairment, net  --       --     42,035      1.14      --      --
of income taxes
Equity-based
compensation                                                      
expense, net:
Alternative LTI  --       --     --         --       5        0.00
expense
Amortization of
restricted stock 38        0.00    --         --       3,048    0.08
& PARS
Income tax       (15)      (0.00)  --         --       (1,115)  (0.03)
benefit
Equity-based
compensation     23        0.00    --         --       1,938    0.05
expense, net
Net income
before
equity-based
compensation     $9,298   $0.26  $8,853     $0.24    $8,264  $0.22
expense and
impairment
charge
                                                                 
Weighted average
shares           36,204            36,712                37,417   
outstanding -
basic
Weighted average
shares           36,243            36,807                38,228   
outstanding -
diluted
                                                                 
"Net Income before Equity-Based Compensation Expense and Impairment Charge", a
non-GAAP financial measure, is defined as income (loss) from continuing
operations before compensation expense incurred in conjunction with
share-based payment awards, alternative long-term incentive awards and
non-cash impairment charges. Kforce measures the cost of employee services
received in exchange for an equity based award based on the grant-date fair
value of the award (with limited exceptions).That cost is recognized over the
period in which the employee is required to provide service in exchange for
the award, which is usually the vesting period.
                                                                 
Adjusted Net Income and Earnings Per Share Before Impairment Charge, Adjusted
EBITDA and Net Income before Equity-Based Compensation Expense and Impairment
Charge are key measures used by management to evaluate its operations and to
provide useful information to investors. These measures should not be
considered in isolation or as an alternative to net income, cash flows data or
other financial statement information presented in the consolidated financial
statements as indicators of financial performance or liquidity. These
measurements are not determined in accordance with generally accepted
accounting principles and are thus susceptible to varying calculations. The
measures as presented may not be comparable to similarly titled measures of
other companies.

CONTACT: Michael R. Blackman
         Chief Corporate Development Officer
         (813) 552-2927

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