OAKBROOK TERRACE, Ill., Nov. 22 /PRNewswire-FirstCall/ -- General
Employment Enterprises, Inc. (Amex: JOB) announced its results for the fourth
quarter and fiscal year ended September 30, 2004.
Fourth Quarter Results
The Company reported income from continuing operations of $64,000, or
$.01 per share, for the quarter ended September 30, 2004, compared with a loss
from continuing operations of $881,000, or $.17 per share, for the same
quarter last year.
As previously announced, the Company sold its staffing business in
Pittsburgh, Pennsylvania on September 24, 2004. As a result, the Company
reported a loss from discontinued operations of $542,000, or $.10 per share,
for the quarter ended September 30, 2004. Results have been restated to
reflect the business as discontinued operations for all periods presented.
The net loss for the quarter ended September 30, 2004 was $478,000, or
$.09 per share, compared with a net loss of $910,000, or $.18 per share, for
the fourth quarter last year.
The Company's consolidated net revenues for the quarter were $4,765,000,
up 12% from $4,270,000 for the same quarter last year. Contract service
revenues of $2,880,000 were about even with last year, while placement service
revenues of $1,885,000 increased 37%.
Commenting on the Company's performance, Herbert F. Imhoff, Jr., board
chairman and CEO, said, "I am very pleased that the Company is able to report
a profit from continuing operations for the fourth quarter of its fiscal year.
National hiring activity continued to improve during the quarter, and the
Company experienced an improvement in the demand for its placement services.
The increase in placement service revenues for the quarter was achieved
through a combination of a 27% increase in the number of placements and an
18% increase in the average placement fee. Contract service revenues were
essentially flat, despite a 13% increase in billable hours, because of lower-
skilled positions and continued downward pressures on pricing in that
division."
Mr. Imhoff continued, "The aggressive actions taken by management to cut
costs also had a significant impact on the results. General and
administrative expenses were down $870,000 (36%) from the fourth quarter of
last year. The combination of improved revenues and reduced expenses enabled
the Company to return to profitability for the quarter."
Fiscal Year Results
For the year ended September 30, 2004, the Company had a loss from
continuing operations of $778,000, or $.15 per share, compared with a loss
from continuing operations of $3,439,000, or $.67 per share, last year.
The net loss for the year was $1,397,000, or $.27 per share, compared with
a net loss of $3,506,000, or $.68 per share, last year.
There were no income tax benefits for either year's loss, because the tax
losses must be carried forward and there was not sufficient assurance that a
future tax benefit would be realized.
Consolidated net revenues for the year were $17,981,000, up 6% compared
with $16,965,000 last year.
Commenting on the Company's performance for the 2004 fiscal year, Mr.
Imhoff said, "We made substantial progress this year. With the improved
revenues and a $2.4 million reduction in general and administrative expenses,
the Company reduced its loss from continuing operations by 77% from last
year."
Mr. Imhoff added, "The disposal of our Pittsburgh operation during the
fourth quarter of the year had a positive effect on the Company's balance
sheet. As a result of the transaction, the Company received $705,000 in cash
and eliminated goodwill of $1,088,000. The cash balance at the end of the
year was up $532,000 from the prior year."
Mr. Imhoff concluded his remarks by saying, "I am gratified to see the
improvement in the Company's performance this year, and I am cautiously
optimistic about the prospects for the 2005 fiscal year. However, continued
improvement for the Company will depend on continued improvement in the
national jobs market."
Business Information
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 19 branch offices located in 10 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 Year
Ended September 30 Ended September 30
2004 2003 2004 2003
Net revenues:
Contract services $ 2,880 $ 2,895 $11,750 $11,477
Placement services 1,885 1,375 6,231 5,488
Net revenues 4,765 4,270 17,981 16,965
Operating expenses:
Cost of contract services 2,080 1,989 8,520 7,875
Selling 1,084 765 3,765 3,641
General and administrative(1) 1,540 2,410 6,508 8,946
Total operating expenses 4,704 5,164 18,793 20,462
Income (loss) from operations 61 (894) (812) (3,497)
Investment income 3 13 34 58
Income (loss) from continuing
operations 64 (881) (778) (3,439)
Loss from discontinued operations(2) (542) (29) (619) (67)
Net loss(3) $ (478) $ (910) $(1,397) $(3,506)
Average number of shares:
Basic 5,136 5,121 5,131 5,121
Diluted 5,363 5,121 5,131 5,121
Per share - basic and diluted:
Income (loss) from continuing
operations $ .01 $ (.17) $ (.15) $ (.67)
Loss from discontinued operations (.10) (.01) (.12) (.01)
Net loss $ (.09) $ (.18) $ (.27) $ (.68)
(1) General and administrative expenses include provisions for office
closings and asset impairment losses totaling $410,000 in the three
month period ended September 30, 2003, $42,000 in the year ended
September 30, 2004 and $625,000 in the year ended September 30,
2003.
(2) In September 2004, the Company completed a transaction to sell the
assets and business operations of its Pittsburgh, Pennsylvania
staffing business ("GenTech") for $705,000 in cash and recorded a
loss on disposal of $553,000. GenTech's operating results are
reflected as discontinued operations for all periods presented.
(3) There were no credits for income taxes as a result of the pretax
losses from continuing operations or from discontinued operations in
fiscal 2004 and fiscal 2003, because the losses must be carried
forward for income tax purposes and there was not sufficient
assurance that a future tax benefit would be realized.
GENERAL EMPLOYMENT ENTERPRISES, INC.
SUMMARIZED CONSOLIDATED BALANCE SHEET INFORMATION
(In Thousands)
September 30 September 30
2004 2003
Assets:
Cash and cash equivalents $ 4,437 $ 3,905
Accounts receivable and other current
assets 2,319 2,595
Total current assets 6,756 6,500
Property, equipment and goodwill 538 2,191
Total assets $ 7,294 $ 8,691
Liabilities and shareholders' equity:
Current liabilities $ 2,126 $ 2,167
Shareholders' equity 5,168 6,524
Total liabilities and shareholders'
equity $ 7,294 $ 8,691
SOURCE General Employment Enterprises, Inc.
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Related links:
http://www.generalemployment.com
Company News On-Call:
http://www.prnewswire.com/comp/113698.html
CONTACT:
Doris A. Bernar, Communications Manager &
Assistant Corporate Secretary of General Employment Enterprises,
Inc., +1-630-954-0495, fax, +1-630-954-0592, e-mail,
invest@genp.com
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