Westaff, Inc., (NASDAQ:WSTF), a leading provider of staffing services, today announced its financial results for its fourth fiscal quarter and fiscal year ended November 1, 2008. Consistent with the Company�s historic financial reporting, the Company's first three fiscal quarters comprise 12 weeks each, while the fourth quarter comprises 16 or 17 weeks, with the Company�s fiscal year ending on the Saturday nearest the end of October.

Consolidated gross revenues for fiscal year 2008 were $324.5 million, down $115.3 million (or 26.2%) from fiscal year 2007. Fiscal year 2008 contained 52 weeks while fiscal year 2007 contained 53 weeks. The consolidated gross revenues attributable to the additional 53rd week in fiscal year 2007 were $8.3 million. The decrease in consolidated gross revenues in fiscal year 2008 would have been $107.0 million (or 24.8%) if compared to a comparable 52-week year in fiscal year 2007 that excludes the additional 53rd week in fiscal year 2007. Gross margin remained at 18.1% in fiscal year 2008. In response to the decline in revenue, the Company had taken measures in fiscal year 2008 to reduce the costs of the organization. As a result, selling and administrative expenses for fiscal year 2008 were $52.6 million, which represents a decrease of $8.7 million (or 14.2%) from fiscal year 2007, primarily due to a decrease in headcount and other cost savings in the areas of facilities, advertising and promotion, and supplies.

The Company�s net loss for fiscal year 2008 was $46.3 million (or a net loss of $2.77 per basic and diluted share), as compared to net loss of $1.9 million (or a net loss of $0.12 per basic and diluted share) for fiscal year 2007. In the second quarter of fiscal year 2008, Westaff recorded a valuation allowance of $23.2 million against deferred tax assets, and in the third quarter of fiscal year 2008, the Company recorded a pre-tax, non-cash write down of goodwill and other intangibles of $11.5 million. Westaff sold its former United Kingdom operations on March 31, 2008 at a gain of $0.4 million, net of tax of $1.3 million, and sold its former Australia and New Zealand subsidiaries subsequent to fiscal year 2008 on November 10, 2008. The financial results of these foreign operations were presented as discontinued operations in the Company�s consolidated financial statements for fiscal year 2008.

Consolidated gross revenues for the fourth fiscal quarter 2008 were $96.3 million, compared with $144.9 million for the fourth fiscal quarter 2007. Excluding the additional 53rd week in fiscal year 2007, consolidated gross revenues for the fourth fiscal quarter 2007 would have been approximately $136.6 million. The Company�s net loss for the fourth fiscal quarter 2008 was $4.1 million (or a net loss of $0.25 per basic and diluted share), compared with the net income of $1.2 million (or $ 0.08 cents per basic and diluted share) for the fourth fiscal quarter 2007. Net income for the fourth fiscal quarter 2007 had included a tax benefit of $2.9 million.

About Westaff

Westaff provides staffing services and employment opportunities for businesses through its network of Company-owned and franchise agent offices. Westaff annually employs more than 100,000 people and services thousands of client accounts throughout the United States. For more information, please visit the company Web site at www.westaff.com.

This press release may contain forward-looking statements within the meaning of the U.S. securities laws. Forward-looking statements are generally identified by words such as "expects," "believes," "will," "should" and similar expressions that are intended to identify forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement. Forward-looking statements involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. Many of these risks and uncertainties cannot be controlled by Westaff. Additional information concerning these risks and uncertainties, and other factors you may wish to consider, is contained in Westaff's filings with the Securities and Exchange Commission, including Westaff's most recent Annual Report on Form 10-K for the year ended November 1, 2008 filed with the SEC on February 13, 2009 and Westaff�s Current Report on Form 8-K filed with the SEC on February 20, 2009.

Forward-looking statements are based on the beliefs and assumptions of Westaff's management and on currently available information. Westaff undertakes no responsibility to publicly update or revise any forward-looking statement except as required by applicable laws and regulations.

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