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Corporate Resource Services Announces 1st Quarter Results

^{Published on 2011-02-17 14:31:04 - Market Wire}
 

NEW YORK--([ BUSINESS WIRE ])--Corporate Resource Services, Inc. (OTCBB: CRRS), a national provider of temporary and permanent staffing services (the aCompanya), today announced results for its first fiscal quarter of 2011.

"As we look to the rest of 2011 and into the future, we will continue to focus on building shareholder value by increasing our market share at each operating subsidiary, making opportunistic acquisitions, and continuing to build an appropriate infrastructure to support our business."

Our revenue for the first fiscal quarter of 2011 totaled $44.9 million, an increase of $22.7 million, or 116.8%, as compared to the corresponding quarter in fiscal year 2010. The revenue increase was primarily attributable to the acquisition of the businesses of Insurance Overload Services, Inc. (aInsurance Overloada), Corporate Resource Development, Inc. (aCRDa) and Integrated Consulting Group, Inc. (aICGa) during the last year. These three businesses increased revenues by $1.5 million, $18.6 million and $1.6 million, respectively. ICGa™s business was acquired on December 14, 2010, and therefore, ICGa™s results are only included during the last two and one-half weeks of the quarter. Additionally, the business of Accountabilities, Inc. (aAccountabilitiesa) experienced increased revenues in the first fiscal quarter of 2011 of $2.5 million, or 18%, as compared to the comparable period in fiscal 2010.

On August 27, 2010, Insurance Overload acquired Tri-Overload Staffing, Inc (aTri-Overloada) from a common owner of the Company. Accordingly, this acquisition has been accounted for as a pooling of interest. As a result, all previously reported financial information with respect to the Company has been restated to include the operating results of Tri-Overload. The Companya™s revenue for the first quarter of fiscal 2010 was restated to include $6.6 million, which amount is attributable to revenue earned by Tri-Overload during this period.

Our income from operations increased $983,000 to $941,000 during the first fiscal quarter of 2011, from a loss of ($42,000) in the corresponding period of fiscal 2010 (which amount was restated to include income of $476,000 at Insurance Overload). Accountabilitiesa™ income from operations improved $585,000 during our first fiscal quarter of 2011. Income from operations improved at Insurance Overload as well, growing to $1.5 million in the comparable 2011 period. These improvements were offset by losses from operations at CRD and ICG.

Our diluted earnings per share for the first fiscal quarter of 2011 was $0.01, compared to a loss of ($0.02) per share in the first fiscal quarter of 2010.

Commenting on the first quarter results, Jay Schecter, Chief Executive Officer of the Company stated: aWe are beginning to see the benefits of the acquisitions we made during the past year, and we continue to realize economies of scale while, at the same time, strengthening our sales programs and team. We are looking forward to our future performance, which will include the results of Diamond Staffing Services, Inc., our wholly-owned subsidiary, which acquired its business in January 2011.a

Mr. Schecter continued, aAs we look to the rest of 2011 and into the future, we will continue to focus on building shareholder value by increasing our market share at each operating subsidiary, making opportunistic acquisitions, and continuing to build an appropriate infrastructure to support our business.a

About Corporate Resource Services

Through its five wholly-owned subsidiaries, Accountabilities, Corporate Resource Development, Insurance Overload Services, Integrated Consulting Group and recently acquired Diamond Staffing Services, Corporate Resource Services is a national provider of diversified staffing, recruiting and consulting services, including temporary staffing services, with a focus on light industrial services, the insurance industry and clerical and administrative support. The Company provides its services across a variety of industries and to a diverse range of clients ranging from sole proprietorships to Fortune 1000 companies. The Company conducts all of its business in the United States through the operation of over approximately 53 staffing and recruiting offices.

Safe Harbor Disclaimer: This press release contains aforward-looking statementsa. These statements relate to expectations concerning matters that are not historical facts. Such forward-looking statements may be identified by words such as aanticipates,a abelieves,a acan," acontinue,a acould,a aestimates,a aexpects,a aintends,a amay,a aplans,a apotential,a apredicts,a ashould,a or awilla or the negative of these terms or other comparable terminology. These statements, and all phases of our operations, are subject to known and unknown risks, uncertainties and other factors, including, but not limited to, our ability to satisfy our working capital requirements; our ability to identify suitable acquisition candidates or investment opportunities; our ability to integrate any acquisitions made and fully realize the anticipated benefits of these acquisitions; successor liabilities that we may be subject to as a result of acquisitions; material employment related claims and costs as a result of the nature of our business; our ability to retain key management personnel; the financial difficulty of our clients, which may result in nonpayment of amounts owed to us; significant economic downturns resulting in reduced demand for our services; our ability to attract and retain qualified temporary personnel, who possess the skills and experience necessary to satisfy our clients and other risk factors as identified in our annual report on Form 10-K for the fiscal year ended September 30, 2010, and our other reports filed with the Securities and Exchange Commission, or SEC. Readers are cautioned not to place undue reliance on these forward-looking statements. Our actual results, levels of activity, performance or achievements and those of our industry may be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Except as required by law, we undertake no obligation to update the forward-looking statements. We refer to our Quarterly Report on Form 10Q for the quarter ended December 31, 2010 for additional information regarding the Companya™s results of operations, balance sheet, liquidity and working capital and strategy.

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