OAKBROOK TERRACE, Ill., Nov. 24 /PRNewswire-FirstCall/ -- General
Employment Enterprises, Inc. (Amex: JOB) reported a net loss of $910,000, or
$.18 per share, for the quarter ended September 30, 2003, compared with a net
loss of $959,000, or $.19 per share, for the same quarter last year.
The Company's consolidated net revenues for the quarter were $4,582,000,
down 7% from $4,921,000 for the same quarter last year. Placement service
revenues of $1,375,000 were down 21% from last year, while contract service
revenues of $3,207,000 increased 1%.
Commenting on the Company's performance, Herbert F. Imhoff, Jr., board
chairman and CEO, said, "I am pleased to report that our contract service
volume in the fourth quarter was up 18% over last year's fourth quarter, and
that for each of the four quarters of the 2003 fiscal year, billable hours
exceeded the corresponding quarter of the prior year. However, the number of
full-time placements made during the fourth quarter was down 11%. Competitive
pressures during the fourth quarter pushed average fees lower in both of our
divisions, resulting in the lower overall revenues for the quarter."
Mr. Imhoff added, "During the fourth quarter we continued to evaluate
marginal operations. As a result, we closed three branch offices and recorded
office closing costs totaling $410,000. There were $148,000 of such charges
in last year's fourth quarter. Excluding those costs, the Company's pretax
loss improved by $266,000 for the quarter, from $766,000 last year to $500,000
this year."
For the fiscal year ended September 30, 2003, the Company had a net loss
of $3,506,000, or $.68 per share, compared with a net loss of $3,214,000, or
$.63 per share last year.
The pretax loss for the current year was $3,506,000, which was the same as
the net loss, compared with a pretax loss of $4,544,000 last year. There was
no income tax benefit for the current year's loss, because the tax loss must
be carried forward and there was not sufficient assurance that a future tax
benefit would be realized. There was a tax credit of $1,330,000 last year.
Consolidated net revenues for the year were $18,609,000, down 8% compared
with $20,318,000 last year.
Commenting on the Company's fiscal 2003 performance, Mr. Imhoff said, "The
last three fiscal years have been a difficult period for our Company, because
of the weak national employment market. Although consolidated revenues
continued to decline in fiscal 2003, there were some significant
accomplishments. Billable contract hours were up 7% for the year, and the
number of placements for the year was only 3% less than the prior year
indicating that the three-year decline in full-time hiring may have bottomed
out."
Mr. Imhoff continued, "We worked hard all year to streamline our Company,
including closing ten branch offices, and made substantial progress in
reducing our operating costs. Excluding provisions for office closings and
impairment losses totaling $625,000 in 2003 and $401,000 in 2002, we reduced
general and administrative expenses by $2,133,000 for the year, and we were
able to reduce the pretax loss by $1,262,000. The Company finished the year
with a cash balance of $3,905,000 and a current ratio of 3.0 to 1."
Mr. Imhoff concluded, "I believe that the Company is well positioned going
into fiscal 2004. But, in order to return to profitability, we need an
increase in overall revenues. To accomplish that, we need to see some
improvement in the employment market, particularly for information technology
and other business and engineering professionals. Although there have been
some promising economic signs recently that a rebound may be coming, we have
yet to see any noticeable improvement in the demand for full-time hiring."
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 22 branch offices located in 11 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
2003 2002 2003 2002
Net revenues:
Placement services $ 1,375 $ 1,750 $ 5,488 $ 6,591
Contract services 3,207 3,171 13,121 13,727
Net revenues 4,582 4,921 18,609 20,318
Operating expenses:
Cost of contract services 2,211 2,094 9,068 9,082
Selling 782 1,029 3,710 4,584
General and administrative(A) 2,512 2,723 9,395 11,304
Total operating expenses 5,505 5,846 22,173 24,970
Loss from operations (923) (925) (3,564) (4,652)
Investment income 13 11 58 108
Loss before income taxes (910) (914) (3,506) (4,544)
Provision (credit) for income
taxes(B) -- 45 -- (1,330)
Net loss $ (910) $ (959) $(3,506) $(3,214)
Net loss per share -
basic and diluted $ (.18) $ (.19) $ (.68) $ (.63)
Average number of shares -
basic and diluted 5,121 5,121 5,121 5,116
(A) 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, $148,000 in the three month
period ended September 30, 2002, $625,000 in the year ended September
30, 2003, and $401,000 in the year ended September 30, 2002.
(B) There were no credits for income taxes as a result of the pretax
losses in fiscal 2003, because the tax losses must be carried forward
and there was not sufficient assurance that a future tax benefit
would be realized. The provision (credit) for income taxes for the
quarter and year ended September 30, 2002 include a provision to
record a deferred tax valuation allowance of $386,000.
GENERAL EMPLOYMENT ENTERPRISES, INC.
SUMMARIZED CONSOLIDATED BALANCE SHEET INFORMATION
(In Thousands)
September 30 September 30
2003 2002
Assets:
Cash and cash equivalents $ 3,905 $ 4,759
Income tax refunds receivable 57 1,540
Accounts receivable and other current
assets 2,538 2,683
Total current assets 6,500 8,982
Property, equipment and goodwill 2,191 2,951
Total assets $ 8,691 $11,933
Liabilities and shareholders' equity:
Current liabilities $ 2,167 $ 1,944
Shareholders' equity 6,524 9,989
Total liabilities and shareholders'
equity $ 8,691 $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/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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