Kforce Inc. Reports Revenues of $283.7 Million and Earnings of $0.21 Per Share

Kforce Inc. Reports Revenues of $283.7 Million and Earnings of $0.21 Per Share

  *Tech Flex Revenue Up 7.6% Sequentially
  *Total Firm Revenues Up 6.8% Sequentially With All Segments Showing
    Sequential Growth

TAMPA, Fla., July 30, 2013 (GLOBE NEWSWIRE) -- Kforce Inc. (Nasdaq:KFRC), a
provider of professional staffing services and solutions, today announced
results for its second quarter of 2013. Revenues for the quarter ended June
30, 2013 were $283.7 million compared to $265.6 million for the quarter ended
March 31, 2013, an increase of 6.8%, and compared to $274.1 million for the
quarter ended June 30, 2012, an increase of 3.5%. For the quarter ended June
30, 2013, Kforce reported net income of $6.9 million, or $0.21 per share,
versus $3.1 million, or $0.09 per share, for the quarter ended March 31, 2013,
an increase of 124.6% in net income and 133.3% in earnings per share. Net
income and earnings per share for the second quarter of 2013 decreased 21.7%
and 12.5%, respectively, versus net income of $8.9 million, or $0.24 per
share, excluding the after-tax goodwill impairment charge, for the second
quarter of 2012.

"We are pleased with our second quarter results as we experienced sequential
Flex revenue increases across all of our segments, including a sequential
increase of 7.6% for Tech and 6.2% for Finance and Accounting. Our investment
in revenue responsible headcount is beginning to take hold, as we made
progress toward our goal of accelerating revenue growth going into the second
half of this year. In addition, we are also taking steps to improve operating
margins and further accelerate leverage as we layer additional revenue on our
operating platform," said David L. Dunkel, Chairman and CEO. Mr. Dunkel
continued, "Demand for our services, particularly in Technology, remains
strong. We also 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. As Kforce has approximately a
3% market share, we believe there are significant opportunities in the 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 second quarter of 2013. We are particularly pleased with the growth in
Tech, our largest business unit, which experienced a strong finish to the
quarter and continued strength into July. While we executed well across our
entire customer base, our larger client revenue growth was particularly strong
during the second quarter.In addition, we are pleased with the progress of
our new hires against a backdrop of strong demand for our services. We are
confident in the course we have set and we will continue to aggressively
pursue business opportunities to gain client and market share."

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

  *Flex revenue of $270.4 million in Q2 '13 increased 6.4% from $254.1
    million in Q1 '13 and increased 3.6% from $260.9 million in Q2 '12.
  *Search revenues of $13.3 million in Q2 '13 increased 15.2% from $11.6
    million in Q1 '13 and increased 0.8% from $13.2 million in Q2 '12.
  *Sequential changes in Flex revenues on a billing day basis by segment
    were: 5.9% increase for Tech, 4.4% increase for FA, 0.7% increase for HIM
    and a 0.6% increase for Government Solutions.
  *Year-over-year changes in Flex revenues by segment were: 5.5% increase in
    Tech, 1.1% decrease in FA, 4.3% decrease in HIM and 8.1% increase in
    Government Solutions.
  *Revenue-responsible headcount increased 17.7% year-over-year.

David M. Kelly, Chief Financial Officer, said, "We have made significant
progress towards our goal of accelerating revenue growth in the second half of
the year. Q2 '13 and Q2 '12 each contained 64 billing days while Q1 '13
contained 63 billing days.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 additional operating
leverage."

Financial highlights for the second quarter include:

  *Flex gross profit increased 110 basis points to 29.4% in Q2 '13 from 28.3%
    in Q1 '13 and increased 10 basis points from 29.3% in Q2 '12.
  *Selling, general and administrative expenses as a percentage of revenues
    was 27.7% in Q2 '13 as compared to 28.5% in Q1 '13 and 26.1% in Q2 '12.
  *In the second quarter of 2013, the Firm repurchased 1.02 million shares
    for $14.8 million; $69.1 million remains available for future repurchases
    under the Board authorization.
  *Bank debt under the Credit Facility increased to $50.1 million at the end
    of Q2 '13 as compared to $39.5 million at the end of Q1 '13, which was
    primarily attributable to the common stock repurchases.

Mr. Kelly stated, "In addition, looking forward to the third quarter of 2013,
we expect revenues may be in the $293 million to $297 million range and
earnings per share in the range of $0.26 to $0.28.The third quarter of 2013
has 64 billing days, the same as the second quarter of 2013.

On Tuesday, July 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, July 30,
2013 through August 14, 2013 by dialing (855) 859-2056, passcode 86987269.

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 August 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 62 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.

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, improve operating leverage
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
                                            June 30,   March 31,  June 30,
                                             2013       2013       2012
                                                                
Revenue by function:                                             
Technology                                  $180,569 $167,635 $171,739
Finance & accounting                        60,854    56,526    60,867
Health information management               18,969    18,636    19,978
Government solutions                        23,297    22,830    21,545
Total revenue                                283,689    265,627    274,129
                                                                
Costs of services                            190,842    182,291    184,363
Gross profit                                 92,847    83,336    89,766
GP %                                         32.7%      31.4%      32.7%
Flex GP %                                    29.4%      28.3%      29.3%
                                                                
Selling, general & administrative expenses   78,503     75,693     71,414
Goodwill impairment                          --       --       65,300
Depreciation & amortization                  2,462      2,397      2,877
                                                                
Income (loss) from operations                11,882     5,246      (49,825)
                                                                
Other expense, net                           205        256        265
                                                                
Income (loss) from continuing operations     11,677     4,990      (50,090)
before income taxes
                                                                
Income tax expense (benefit)                 4,729      1,896      (16,908)
                                                                
Income (loss) from continuing operations     6,948      3,094      (33,182)
                                                                
Income from discontinued operations, net of  --        --        15
income taxes
                                                                
Net income (loss)                            $6,948   $3,094   $(33,167)
                                                                
                                                                
Earnings per share - diluted                 $0.21    $0.09    $(0.90)
Adjusted EBITDA per share                    $0.44    $0.23    $0.50
Shares outstanding - diluted                33,859     34,485     36,712
                                                                
Adjusted EBITDA                             $14,755  $7,904   $18,325
                                                                
Other information:                                               
Capital expenditures                         $2,992   $2,618   $2,519
Equity-based compensation expense, net       $194     $170     $--
Working capital                              $94,614  $89,987  $105,436
                                                                
Selected balance sheet information:                              
Cash and cash equivalents                    $1,064   $907     $812
Accounts receivable, less allowances         $164,713 $164,487 $179,408
Total assets                                 $345,169 $340,981 $369,467
Bank debt                                    $50,113  $39,549  $10,992
Total liabilities                            $184,743 $173,335 $153,128
Total stockholders' equity                   $160,426 $167,646 $216,339
                                                                
Billing days                                 64         63         64

                                                       
                               Kforce Inc.              
                               Key Statistics           
                               (Unaudited)              
                                                       
                               Q2 2013        Q1 2013    Q2 2012
Total Firm                                              
Flex revenue (000's)            $270,385     $254,075 $260,925
Revenue per billing day (000's) $4,225       $4,033   $4,077
Sequential flex revenue change  6.4%           -1.8%      1.4%
Hours (000's)                   4,598         4,288     4,411
Flex GP %                       29.4%          28.3%      29.3%
                                                       
Search revenue (000's)          $13,304      $11,552  $13,204
Placements                     940           865       956
Average fee                     $14,151      $13,352  $13,817
Billing days                    64            63        64
                                                       
Technology                                              
Flex revenue (000's)            $175,213     $162,840 $166,044
Revenue per billing day (000's) $2,738       $2,585   $2,594
Sequential flex revenue change  7.6%           -0.3%      3.5%
Hours (000's)                   2,688         2,517     2,532
Flex GP %                       27.8%          27.0%      27.9%
                                                       
Search revenue (000's)          $5,356       $4,795   $5,695
Placements                     336           310       354
Average fee                     $15,955      $15,472  $16,076
                                                       
Finance & Accounting                                    
Flex revenue (000's)            $52,954      $49,861  $53,562
Revenue per billing day (000's) $827         $792     $837
Sequential flex revenue change  6.2%           -4.0%      -2.0%
Hours (000's)                   1,628         1,498     1,585
Flex GP %                       30.9%          29.3%      31.0%
                                                       
Search revenue (000's)          $7,900       $6,665   $7,305
Placements                     600           549       593
Average fee                     $13,156      $12,135  $12,330
                                                       
Health Information Management                           
Flex revenue (000's)            $18,921      $18,544  $19,774
Revenue per billing day (000's) $296         $294     $309
Sequential flex revenue change  2.0%           -4.1%      2.3%
Hours (000's)                   282           273       294
Flex GP %                       32.8%          31.8%      36.5%
                                                       
Search revenue (000's)          $48          $92      $204
Placements                      4             6         9
Average fee                     $12,126      $15,363  $22,739
                                                       
Government Solutions                                    
Flex revenue (000's)            $23,297      $22,830  $21,545
Revenue per billing day (000's) $364         $362     $337
Sequential flex revenue change  2.0%           -5.6%      -6.3%
Flex GP %                       35.4%          31.8%      30.0%


Kforce Inc.
Selected Financial Information and Reconciliations
(In Thousands, Except Per Share Amounts)
(Unaudited)
                                                               
Quarterly                                                       
Adjusted EBITDA
                Three Months Ended
                June 30,            March 31,          June 30,
                 2013                2013               2012
                $          Per      $         Per      $            Per share
                            share              share
                                                               
Net income       $6,948   $0.21  $3,094  $0.09  $(33,167)  $(0.90)
(loss)
Income from
discontinued     --       --     --      --     15           0.00
operations, net
of income taxes
Income (loss)
from continuing  $6,948   $0.21  $3,094  $0.09  $(33,182)  $(0.90)
operations
Goodwill
impairment,      --       --     --      --     65,300      1.77
pre-tax
Depreciation &   2,462     0.07    2,397    0.07    2,877       0.08
amortization
Amortization of  326       0.01    274      0.00    --         --
restricted stock
Interest expense 290       0.01    243      0.00    238         0.01
and other
Income tax
expense          4,729     0.14    1,896    0.07    (16,908)    (0.46)
(benefit)
Adjusted EBITDA  $14,755  $0.44  $7,904  $0.23  $18,325    $0.50
                                                               
Weighted average
shares           33,754            34,391           36,712      
outstanding -
basic
Weighted average
shares           33,859            34,485           36,807      
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 andis 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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