Press Release Archive
Spherion president and
For the six month period ended
The net loss from discontinued operations includes tax expense of $3.2 million, attributable to a change in tax estimates resulting from the sale of the Company’s technology consulting business in The Netherlands, in the second quarter.
In July, the Company entered into a new four-year credit facility, secured by accounts receivable, which replaces the existing 364-day working capital facility. The new facility allows the Company to borrow up to $200 million against eligible accounts receivable, increasing the Company’s ability to fund working capital requirements over the longer-term.
Effective with the start of the third quarter 2003, the Company successfully implemented the financial phase of its new enterprise-wide information system. Upon completion, the system will provide a fully integrated, Web-enabled technology platform across all of the Company’s business lines. In addition, the Company identified incremental cost reduction opportunities by centralizing business support functions. The Company anticipates that this technology investment and the standardization of business processes will significantly enhance productivity and reduce operating expenses in future periods. As a result of both of these efforts, the Company will incur restructuring costs, principally severance, over the next several quarters to realize these benefits.
Krause commented, “Profitable revenue growth remains our highest priority. Our guidance for the third quarter assumes continued modest improvement in our recruiting operations, ongoing stability in our technology segment, partially offset by continued weakness in our outsourcing and outplacement businesses.” He added, “I am confident that we will continue to make solid progress on our internal technology and infrastructure initiatives. Based on current trends, I anticipate our loss per share, including restructuring costs, will be roughly in the same range as the second quarter.”
The Company currently anticipates revenue for the third quarter 2003 to be between $505 and $525 million and results from continuing operations to be between ($0.02) and ($0.07) per share. This guidance includes a pre-tax charge of approximately $3 million for the restructuring actions expected during the third quarter and assumes a 30% effective tax rate.
Spherion Corporation provides recruitment, technology and outsourcing services. Founded in 1946, with operations in
This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. Factors that could cause future results to differ from current expectations include risks associated with: Competition - our business operates in highly competitive markets with low barriers to entry; Economic conditions - a significant economic downturn could result in our clients using fewer flexible employees or the loss or bankruptcy of a significant client could materially adversely affect our business results; Changing market conditions - our business is dependent upon the availability of qualified personnel; Corporate strategy - we may not achieve the intended effect of our business strategy; Technology demand – lack of client investments in new technology may result in reduced demand for our Technology services; Technology Investments – our investment in technology initiatives may not yield their intended results; Tax filings – regulatory challenges to our tax filing positions could result in additional taxes; Credit Rating – further reduction in the Company’s credit rating may affect our ability to borrow and increase future borrowing costs; Litigation - we are a defendant in a variety of litigation and other actions from time to time and we may be exposed to employment–related claims and costs; Other - government regulation may increase our costs; business risks associated with international operations could make those operations more costly; failure or inability to complete our outsourcing projects could result in damage to our reputation and give rise to legal claims; managing or integrating any future acquisitions may strain our resources, and certain contracts contain termination provisions and pricing risks. These and additional factors discussed in this release and in Spherion’s filings with the Securities and Exchange Commission could cause the Company’s actual results to differ materially from any projections contained in this release.