For Immediate Release
Career Horizons, Inc. Reports Record 1996 Third Quarter
and Nine Months Results
Woodbury, NY -- October 22, 1996 -- Career Horizons, Inc. (NYSE: CHZ)
today reported record financial results for the quarter and nine months
ended September 30, 1996.
For the third quarter, revenues rose 74 percent to $168.5 million, from
$97.0 million for the corresponding period a year ago. The increases
reflect substantial acquisition activity over the past year and internal
growth. Net income more than doubled to $5.5 million from $2.5 million
last year, driven by revenue gains and improved profitability. Fully
diluted earnings per share were $0.28, up 40 percent from $0.20 a year
earlier. The per share comparison reflects an 85 percent rise in average
shares outstanding as a result of two financings completed in prior
quarters.
Revenues for the first nine months of 1996 advanced to $444.3 million, up
58 percent from $280.7 million last year. Net income increased 91
percent to $12.8 million, compared to $6.7 million (before a special
charge of $550,000). Fully diluted earnings rose 34 percent, to $0.71
per share from $0.53 (adjusted for the charge) a year ago, reflecting a
77 percent increase in average shares outstanding.
Walter W. Macauley, President and Chief Executive Officer, said, "We are
pleased to report financial results for the quarter which show an
acceleration in revenues from the first half pace, and continuing
improvement in profitability. In addition to the growth from our
aggressive acquisition program, each of our divisions, information
technology, general staffing, PL Services, and health care, grew
internally over the year-ago period. As we pursue the pending merger
with AccuStaff, we remain firmly focused on the growth strategies that
have served us well over the past year."
Mr. Macauley concluded, "We acquired two sizable information technology
companies, Berger & Co. and TSG Professional Services, Inc., with
combined annual revenues expected to be in excess of $80 million, and
offices in strategic geographic markets, including Denver, Dallas,
Houston and Atlanta. Since launching this new specialty segment in
August 1995, Career Horizons has now acquired eight IT firms with
annualized revenues of over $200 million."
On August 26, 1996, Career Horizons entered into an agreement to be
merged with a subsidiary of AccuStaff Incorporated. The companies have
received notice from the Federal Trade Commission of early termination of
the waiting period under the Hart-Scott-Rodino Act. A Joint Proxy
Statement/Prospectus was recently declared effective by the Securities
and Exchange Commission, and was mailed with proxy materials on October
8, 1996 to stockholders of record as of October 4, 1996. The special
meeting for Career Horizons' shareholders will be held on November 14,
1996. The transaction is expected to close on the same day.
The combined company will be a nationwide provider of strategic staffing,
consulting, and outsourcing services with a total of over 750 offices in
44 states and 1995 pro forma revenues of approximately $1.4 billion. Its
information technology staffing revenues will be more than $450 million
annually on a pro forma basis, moving towards its goal of $500 million by
year end.
Contacts:
Career Horizons, Inc. Lundy Associates, Inc.
Michael T. Druckman Michael A. Lundy
Chief Financial Officer 201-660-1100
516-682-1403
# # #
Career Horizons' Web Address: http://www.chi.com
CAREER HORIZONS, INC. and SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
1996 1995 1996 1995
------ ------ ------ ------
REVENUES $168,491 $96,950 $444,342 $280,683
EXPENSES:
Cost of services 127,563 73,855 337,796 214,970
Selling, general and
administrative expenses 25,345 13,861 66,982 39,290
Remittance to franchisees 5,706 4,514 15,604 13,749
Other expense, net 152 93 541 1,227
-------- ------- -------- --------
Total expenses 158,766 92,323 420,923 269,236
Income from operations 9,725 4,627 23,419 11,447
Interest expense, net (854) (480) (2,656) (1,440)
-------- ------ -------- --------
Income before income taxes 8,871 4,147 20,763 10,007
Provision for income taxes (3,415) (1,659) (7,993) (3,875)
-------- ------- -------- --------
NET INCOME $ 5,456 $ 2,488 $ 12,770 $ 6,132
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INCOME PER COMMON SHARE:
Primary $.30 $.20 $.75 $.50
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Fully Diluted $.28 $.20 $.71 $.49
==== ==== ==== ====
Weighted average common
shares outstanding
Primary 18,268 12,485 17,039 12,384
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Fully Diluted 23,292 12,579 22,087 12,492
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