OAKBROOK TERRACE, Ill., April 24 /PRNewswire-FirstCall/ --
General Employment Enterprises, Inc. (Amex: JOB) reported a net loss of
$1,100,000, or $ .21 per share, for the quarter ended March 31, 2003, compared
with a net loss of $921,000, or $ .18 per share, for the same quarter last
year.
The pretax loss for the current quarter was $1,100,000, which was the same
as the net loss, compared with a pretax loss of $1,491,000 last year. There
was no income tax benefit for the current year's loss, while there was a tax
credit of $570,000 last year.
The Company's consolidated net revenues for the quarter were $4,530,000,
down 12% from $5,154,000 for the same quarter last year. Placement service
revenues of $1,136,000 were down 29%, while contract service revenues of
$3,394,000 declined 5%.
Commenting on the Company's performance, Herbert F. Imhoff, Jr., board
chairman and CEO, said, "The labor market in the United States was very weak
during the March 2003 quarter, as any signs of increased hiring levels that we
saw during the December 2002 quarter evaporated. That weakness had a
particularly adverse effect on the demand for our permanent placement
services, and as a result, the number of placements made during the quarter
dropped 16% below the depressed level of the second quarter of last year. The
weak demand also contributed to lower average fees for both of our divisions.
One encouraging trend, however, was that the number of billable contract hours
rose 5%."
Mr. Imhoff continued, "Despite the weak labor market and lower revenues, I
am pleased with the Company's performance on controlling costs, as actions
taken over the past year are now showing up in our reduced cost structure.
For the quarter, general and administrative expenses were down 25%, and total
operating expenses were down 16%. These reductions reflect the benefit of
closing four unprofitable branch offices during the last twelve months and
other staff reductions. As a result, the Company reduced its second-quarter
pretax loss by $391,000, or 26%, compared with last year."
For the six months ended March 31, 2003, the Company had a net loss of
$1,744,000, or $ .34, per share, compared with a net loss of $1,471,000, or
$ .29 per share, for the same period last year. Consolidated net revenues for
the six-month period were $9,430,000, down 12% compared with $10,663,000 last
year.
Mr. Imhoff concluded his comments by saying, "I am committed to returning
the Company to profitability. We made important strides in reducing our cost
structure, and we will continue to examine further cost-reduction options in
the future. Nevertheless, our return to profitability depends on an
improvement in the national hiring levels for information technology and other
professionals. It is difficult to predict when corporate America will begin
hiring again, but I am cautiously optimistic that the resolution of matters in
Iraq will have a positive influence."
This news release contains forward-looking statements that are based on
management's current expectations and are subject to risks and uncertainties.
Some of the factors that could affect the Company's future performance include
general business conditions, the demand for the Company's services,
competitive market pressures, the ability of the Company to attract and retain
qualified personnel for regular full-time placement and contract project
assignments, and the ability of the Company to attract and retain qualified
corporate and branch management.
General Employment provides professional staffing services through a
network of 30 branch offices, located in high-tech centers in 12 states, and
specializes in information technology, accounting and engineering placements.
The Company's shares are traded on the American Stock Exchange under the
trading symbol JOB.
GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(In Thousands, Except Per Share)
Three Months Six Months
Ended March 31 Ended March 31
2003 2002 2003 2002
Net revenues:
Placement services $ 1,136 $ 1,597 $ 2,756 $ 3,479
Contract services 3,394 3,557 6,674 7,184
Net revenues 4,530 5,154 9,430 10,663
Operating expenses:
Cost of contract
services 2,394 2,350 4,611 4,748
Selling 894 1,207 2,018 2,511
General and
administrative(A) 2,348 3,119 4,569 5,854
Total operating
expenses 5,636 6,676 11,198 13,113
Loss from operations (1,106) (1,522) (1,768) (2,450)
Interest income 6 31 24 79
Loss before income
taxes (1,100) (1,491) (1,744) (2,371)
Credit for income
taxes(B) -- (570) -- (900)
Net loss $(1,100) $(921) $ (1,744) $(1,471)
Net loss per share $(.21) $(.18) $(.34) $(.29)
Average number of shares 5,121 5,121 5,121 5,111
(A) General and administrative expenses include provisions for office
closings of $37,000 in the three and six month periods ended
March 31, 2003, and $253,000 in the three months and six months ended
March 31, 2002.
(B) There were no credits for income taxes as a result of the pretax
losses for the three and six month periods ended March 31, 2003,
because the tax losses must be carried forward and there was not
sufficient assurance that future tax benefits would be realized.
GENERAL EMPLOYMENT ENTERPRISES, INC.
SUMMARIZED CONSOLIDATED BALANCE SHEET INFORMATION
(In Thousands)
March 31 September 30
2003 2002
Assets:
Cash and cash equivalents $4,541 $4,759
Income tax refunds receivable 253 1,540
Accounts receivable and other current assets 2,688 2,683
Total current assets 7,482 8,982
Property, equipment and goodwill, net 2,687 2,951
Total assets $10,169 $11,933
Liabilities and shareholders' equity:
Current liabilities $1,904 $1,944
Shareholders' equity 8,265 9,989
Total liabilities and shareholders' equity $10,169 $11,933
SOURCE General Employment Enterprises, Inc.
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Related links:
http://www.generalemployment.com
Company News On-Call:
http://www.prnewswire.com/gh/cnoc/comp/113698.html
CONTACT:
Doris A. Bernar, Communications Manager &
Assistant Corporate Secretary of General Employment Enterprises,
Inc., +1-630-954-0495, or fax, +1-630-954-0592, invest@genp.com
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