Kforce Inc. Reports Revenues of $265.6 Million and Earnings of $0.09 Per Share

Kforce Inc. Reports Revenues of $265.6 Million and Earnings of $0.09 Per Share

TAMPA, Fla., April 30, 2013 (GLOBE NEWSWIRE) -- Kforce Inc. (Nasdaq:KFRC), a
provider of professional staffing services and solutions, today announced
results for its first quarter of 2013. Revenues for the quarter ended March
31, 2013 were $265.6 million compared to $269.8 million for the quarter ended
December 31, 2012, a decrease of 1.6%, and compared to $268.4 million for the
quarter ended March 31, 2012, a decrease of 1.0%. In the quarter ended March
31, 2013, Kforce reported net income of $3.1 million, or $0.09 per share,
versus $8.6 million, or $0.24 per share, excluding the goodwill impairment
charge, for the quarter ended December 31, 2012. Net income and earnings per
share for the first quarter of 2013 decreased 24.1% and 25.0%, respectively,
versus net income of $4.1 million, or $0.12 per share, for the first quarter
of 2012.

"The Firm's results in the first quarter did not meet our expectations and we
are not satisfied. Our Technology and Government businesses performed near
anticipated levels; however, due to shortfalls primarily in our Finance and
Accounting and Health Information Management businesses, our top line results
were slightly below our expectations. We believe the significant investment in
sales associates at the end of 2012, which has continued in the first quarter
at more measured levels, is taking hold, and we are making progress toward our
goal of accelerating revenue growth in the second half of this year," said
David L. Dunkel, Chairman and CEO. Mr. Dunkel continued, "We believe our
diverse service offerings, as well as our highly elastic front and back
office, position Kforce well. Demand for our services, particularly in
Technology, remains solid. In addition, we continue to see a secular shift
where our clients are increasingly seeking a higher degree of variability in
the composition of their workforce as they look to mitigate economic
uncertainty and the increasing complexity and costs of employment due to
regulatory changes. There are significant opportunities as Kforce has only
approximately a 3% market share in a growing domestic professional staffing
market. I want to thank all of our employees and consultants for their hard
work, dedication and progress this past quarter."

Joseph J. Liberatore, President, said, "The Firm continued to make progress in
the first quarter of 2013, where we experienced a Flex gross profit increase
of 120 basis points year-over-year, which was primarily driven by Tech, our
largest segment. We continued to execute using our highly advanced sales
platform by leveraging our field associates, Strategic Accounts and the
National Recruiting Center to improve growth and profitability with both large
and small clients. Kforce continues to aggressively pursue business
opportunities to gain client and market share."

Mr. Liberatore noted additional operational results for the first quarter
include:

  *Flex revenue of $254.1 million in Q1 '13 decreased 1.8% from $258.7
    million in Q4 '12 and decreased 1.3% from $257.3 million in Q1 '12.
  *Search revenues of $11.6 million in Q1 '13 increased 4.1% from $11.1
    million in Q4 '12 and increased 4.9% from $11.0 million in Q1 '12.
  *Year-over-year changes in Flex revenue on a billing day basis were: 3.2%
    increase in Tech, 0.8% increase in Government Solutions, 2.6% decrease in
    HIM and a 7.3% decrease in FA.
  *Revenue responsible headcount increased 3.2% sequentially and 23.2%
    year-over-year.

David M. Kelly, Chief Financial Officer, said, "We are making progress toward
our goal of accelerating revenue growth in the back half of the year, but
there remains much work to do. Q1 '13 contained 63 billing days while Q4 '12
and Q1 '12 contained 62 and 64 billing days, respectively. We expect to
continue making selective human capital investments to drive top line
performance as we continue to see positive indicators for the demand in our
business. We remain confident in our strategy and long term prospects and
expect to capitalize on the operating platform we have built to grow revenue
and generate operating leverage."

Financial highlights for the first quarter include:

  *Flex gross profit increased 120 basis points to 28.3% in Q1 '13 from 27.1%
    in Q1 '12.
  *Selling, general and administrative expenses as a percentage of revenues
    were 28.5% in Q1 '13 as compared to 26.9% in Q4 '12 and 28.6% in Q1 '12,
    excluding the charges related to the acceleration of certain long-term
    incentive awards in Q1 '12.
  *During Q1 '13, the Firm repurchased approximately 410,000 shares of common
    stock for $5.9 million; $83.9 million remains available for future
    repurchases under the Board authorization.
  *The Firm had bank debt of $39.5 million at the end of Q1 '13 as compared
    to $21.0 million at the end of Q4 '12. The increase is primarily
    attributable to the timing of certain annual payments and the $5.9 million
    in common stock repurchases.

Mr. Kelly stated, "In addition, looking forward to the second quarter of 2013,
we expect revenues may be in the $277 million to $281 million range and
earnings per share in the range of $0.19 to $0.21. The second quarter of 2013
has 64 billing days, as compared to 63 billing days in the first quarter of
2013.

On Tuesday, April 30, 2013, 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, Tuesday, April 30,
2013 through May 14, 2013 by dialing (855) 859-2056, passcode 86980458.

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 May 14, 2013.

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
2,600 associates and approximately 10,300 consultants on assignment, Kforce is
committed to "Great People = Great Results" for our valued clients and
candidates. Kforce operates with 64 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
                                            Mar. 31,   Dec. 31,   Mar. 31,
                                            2013       2012       2012
                                                                
Revenue by function:                                             
Technology                                  $167,635 $167,616 $165,655
Finance & accounting                        56,526    58,624    60,256
Health information management               18,636    19,406    19,451
Government solutions                        22,830    24,193    22,988
Total revenue                                265,627    269,839    268,350
                                                                
Costs of services                            182,291    181,259    187,525
Gross profit                                 83,336    88,580    80,825
GP %                                         31.4%      32.8%      30.1%
Flex GP %                                    28.3%      29.9%      27.1%
                                                                
Selling, general & administrative expenses   75,693     72,540     108,115
Goodwill impairment                          --       3,858     --
Depreciation & amortization                  2,397      2,371      2,882
                                                                
Income (loss) from operations                5,246      9,811      (30,172)
                                                                
Other expense, net                           256        171        392
                                                                
Income (loss) from continuing operations     4,990      9,640      (30,564)
before income taxes
                                                                
Income tax expense (benefit)                 1,896      3,718      (12,837)
                                                                
Income (loss) from continuing operations     $3,094   $5,922   $(17,727)
                                                                
Income from discontinued operations, net of  --        198       21,803
income taxes
                                                                
Net income                                   $3,094   $6,120   $4,076
                                                                
Earnings per share - diluted                 $0.09    $0.17    $0.12
Adjusted EBITDA per share                    $0.23    $0.45    $(0.05)
Shares outstanding - diluted                34,485     35,573     34,703
                                                                
Adjusted EBITDA                             $7,904   $16,070  $(1,747)
                                                                
Other information:                                               
Capital expenditures                         $2,618   $1,472   $959
Equity-based compensation expense, net       $170     $33      $20,541
Working capital                              $89,987  $72,685  $83,273
                                                                
Selected balance sheet information:                              
Cash and cash equivalents                    $907     $1,381   $862
Accounts receivable, less allowances         $164,487 $151,570 $173,125
Total assets                                 $340,981 $325,149 $409,409
Bank debt                                    $39,549  $21,000  $--
Total liabilities                            $173,335 $155,303 $159,506
Total stockholders' equity                   $167,646 $169,846 $249,903
                                                                
Billing days                                 63         62         64



Kforce Inc.
Key Statistics
(Unaudited)
                                                   
                               Q1 2013    Q4 2012    Q1 2012
                                                   
Total Firm                                          
Flex revenue (000's)            $254,075 $258,743 $257,342
Revenue per billing day (000's) $4,033   $4,173   $4,021
Sequential flex revenue change  -1.8%      0.4%       3.3%
Hours (000's)                   4,288     4,405     4,369
Flex GP %                       28.3%      29.9%      27.1%
                                                   
Search revenue (000's)          $11,552  $11,096  $11,008
Placements                     865       791       799
Average fee                     $13,352  $14,027  $13,778
Billing days                    63        62        64
                                                   
Technology                                          
Flex revenue (000's)            $162,840 $163,282 $160,394
Revenue per billing day (000's) $2,585   $2,634   $2,506
Sequential flex revenue change  -0.3%      -1.2%      2.5%
Hours (000's)                   2,517     2,511     2,459
Flex GP %                       27.0%      28.4%      25.3%
                                                   
Search revenue (000's)          $4,795   $4,334   $5,261
Placements                     310       290       337
Average fee                     $15,472  $14,960  $15,624
                                                   
Finance & Accounting                                
Flex revenue (000's)            $49,861  $51,936  $54,638
Revenue per billing day (000's) $792     $837     $854
Sequential flex revenue change  -4.0%      0.5%       7.3%
Hours (000's)                   1,498     1,607     1,615
Flex GP %                       29.3%      30.8%      29.1%
                                                   
Search revenue (000's)          $6,665   $6,688   $5,618
Placements                     549       498       441
Average fee                     $12,135  $13,434  $12,734
                                                   
Health Information Management                       
Flex revenue (000's)            $18,544  $19,332  $19,322
Revenue per billing day (000's) $294     $312     $302
Sequential flex revenue change  -4.1%      6.9%       4.8%
Hours (000's)                   273       287       295
Flex GP %                       31.8%      35.2%      32.9%
                                                   
Search revenue (000's)          $92      $74      $129
Placements                      6         3         21
Average fee                     $15,363  $21,043  $6,121
                                                   
Government Solutions                                
Flex revenue (000's)            $22,830  $24,193  $22,988
Revenue per billing day (000's) $362     $390     $359
Sequential flex revenue change  -5.6%      6.6%       -1.2%
Flex GP %                       31.8%      34.3%      30.6%



Kforce Inc.
Selected Financial Information and Reconciliation
(In Thousands, Except Per Share Amounts)
(Unaudited)
                                                               
Quarterly                                                       
Adjusted EBITDA
                Three Months Ended
                Mar. 31,           Dec. 31,            Mar. 31,
                2013               2012                2012
                $         Per      $          Per      $            Per share
                           share               share
                                                               
Net income       $3,094  $0.09  $6,120   $0.17  $4,076     $0.12
Income from
discontinued     --      --      198        0.00    21,803       0.63
operations, net
of income taxes
Income (loss)
from continuing  $3,094  $0.09  $5,922   $0.17  $(17,727)  $(0.51)
operations
Goodwill
impairment,      --      --     3,858     0.11    -- --
pre-tax
Depreciation &   2,397    0.07    2,371     0.07    2,882       0.08
amortization
Acceleration of
restricted stock --      --     --       --     22,158      0.64
& PARS
Amortization of
restricted stock 274      0.00    53        0.00    3,439       0.10
& PARS
Interest expense 243      0.00    148       0.00    338         0.01
and other
Income tax
expense          1,896    0.07    3,718     0.10    (12,837)    (0.37)
(benefit)
Adjusted EBITDA  $7,904  $0.23  $16,070  $0.45  $(1,747)   $(0.05)
                                                               
Weighted average
shares           34,391           35,530            34,703      
outstanding -
basic
Weighted average
shares           34,485           35,573            34,703      
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.
                                                               
Adjusted EBITDA is a key measure used by management to evaluate its operations
and to provide useful information to investors. This measure 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. This
measurement is 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: AT THE FIRM
         Michael R. Blackman
         Chief Corporate Development Officer
         (813) 552-2927

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