GEN.EMPLOYM.ENTERP 
By OAKBROOK TERRACE, Ill., May 3 /PRNewswire-FirstCall/ -- General Employment Enterprises, Inc. (NYSE Amex: JOB) reported consolidated net revenues for the quarter ended March 31, 2010 of $2,028,000, which were down 18% compared with consolidated net revenues of $2,472,000 reported for the same period last year. It was the second quarter of the Company's 2010 fiscal year. Contract service revenues for the quarter of $1,456,000 increased 4% from the same period last year. Placement service revenues of $572,000 decreased 47% from last year.
The Company had a net loss of $700,000 or $.05 per share, in the second quarter of this year, compared with a net loss of $1,088,000, or $.21 per share, in the second quarter last year. For purposes of calculating the per-share amounts, the number of average common shares outstanding was 13,380,000 in the current quarter, compared with 5,165,000 in the prior-year quarter.
Commenting on the Company's performance, Salvatore J. Zizza, CEO said, "General economic conditions continued to place pressures on the Company. Our net revenues were comparable to our preceding quarter. In addition, I am happy to report that our core operating expenses were held in check (during the quarter), keeping in line with our 2009 restructuring.
Mr. Zizza continued, "Recently, U.S. employment trends have indicated signs of improvement on which General Employment is positioned to capitalize. If these trends continue, we believe that we can incrementally add to our revenues and contain our costs, which in turn will provide for further improvements to our margin."
Six Months Results
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For the six months ended March 31, 2010, the Company had a net loss of $1,289,000, or $.10 per share, compared with a net loss of $1,864,000, or $.36 per share, for the same period last year. Consolidated net revenues for the six-month period were $4,000,000, down 25% compared with $5,359,000 last year.
Business Information
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General Employment provides professional staffing services, and specializes in information technology, accounting and engineering placements.
The Company's business is highly dependent on national employment trends in general and on the demand for professional staff in particular. Because long-term contracts are not a significant part of the Company's business, future results cannot be reliably predicted by considering past trends or by extrapolating past results. Some of the factors that could affect the Company's future performance include, but are not limited to, 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 assignments, the possibility of incurring liability for the Company's business activities, including the activities of contract employees and events affecting its contract employees on client premises, and the ability of the Company to attract and retain qualified corporate and branch management.
Forward Looking Statements
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The statements made in this press release which are not historical facts are forward-looking statements. Such forward-looking statements often contain or are prefaced by words such as "will" and "expect." As a result of a number of factors, our actual results could differ materially from those set forth in the forward-looking statements. Certain factors that might cause our actual results to differ materially from those in the forward-looking statements include, without limitation, those factors set forth under the heading "Forward-Looking Statements" in our annual report on Form 10-K for the fiscal year ended September 30, 2009, and in our other filings with the SEC. General Employment is under no obligation to (and expressly disclaims any such obligation to) and does not intend to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
GENERAL EMPLOYMENT ENTERPRISES, INC.
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CONSOLIDATED STATEMENT OF OPERATIONS
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(In Thousands, Except Per Share)
Three Months Six Months
------------ ----------
Ended March 31 Ended March 31
-------------- --------------
2010 2009 2010 2009
---- ---- ---- ----
Net revenues:
Contract services $1,456 $1,398 $2,858 $2,943
Placement services 572 1,074 1,142 2,416
--- ----- ----- -----
Net revenues 2,028 2,472 4,000 5,359
Cost of contract
services 1,059 1,017 2,055 2,053
Selling, general and
administrative
expenses(1) 1,660 2,530 3,207 5,086
----- ----- ----- -----
Loss from operations (691) (1,075) (1,262) (1,780)
Other expense (9) (13) (27) (84)
--- --- --- ---
Net loss(2) $(700) $(1,088) $(1,289) $(1,864)
===== ======= ======= =======
Average number of
shares -basic and
diluted 13,380 5,165 13,380 5,165
====== ===== ====== =====
Net loss per share -
basic and diluted $(.05) $(.21) $(.10) $(.36)
===== ===== ===== =====
(1) Selling, general and administrative expenses for the six months
ended March 31, 2010 include $196,000 in legal fees, primarily for
the proposed purchase of GT Systems, Inc.
(2) There were no credits for income taxes as a result of the pretax
losses during the periods, because there was not sufficient
assurance that the future tax benefits would be realized.
GENERAL EMPLOYMENT ENTERPRISES, INC.
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SUMMARIZED CONSOLIDATED BALANCE SHEET INFORMATION
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(In Thousands)
September
March 31 30
2010 2009
---- ----
Assets:
Cash and cash equivalents $1,433 $2,810
Other current assets 1,147 1,287
----- -----
Total current assets 2,580 4,097
Property and equipment, net 470 570
--- ---
Total assets $3,050 $4,667
====== ======
Liabilities and
shareholders' equity:
Current liabilities $1,179 $1,488
Long-term obligations 504 575
Shareholders' equity 1,367 2,604
----- -----
Total liabilities and
shareholders' equity $3,050 $4,667
====== ======
SOURCE General Employment Enterprises, Inc.
