Daily News
View All NewsOn Assignment revenue up 7.5%
On Assignment Inc. (NYSE: ASGN) reported revenue rose 7.5% in the fourth quarter to $620.9 million, led by the Apex division, which accounted for 76.7% of total revenue and posted 9.6% year-over-year growth.
Net income also rose 24.3% at the Calabasas, Calif.-based firm; however, gross margin narrowed.
On Assignment ranked as the 10th-largest US staffing firm with top segments served including IT and life sciences. In 2015, it acquired Creative Circle, the second-largest marketing/creative staffing firm in the US.
| (US$ thousands) | Q4 2016 | Q4 2015 | % change |
| Revenue | $620,884 | $577,517 | 7.5% |
| Gross profit | $198,195 | $192,932 | 2.7% |
| Gross margin | 31.9% | 33.4% | |
| Net income | $24,028 | $19,338 | 24.3% |
On Assignment last month promoted Ted Hanson to president of the firm. CEO Peter Dameris previously served as both president and CEO, but handed the president role over to Hanson in order to focus on bigger-picture items at the company.
Quote
“The fourth quarter and full year 2016 were once again record periods of financial performance for our company,” said Dameris. “Throughout 2016, we continued to grow above published industry growth rates and established many new and meaningful customer relationships.”
Dameris continued, “Throughout the year, we continued to experience greater rates of adoption of our development/deployment model (i.e. staff augmentation). There are currently many secular and political drivers that are causing our customers to want to execute their IT needs with domestic, shared resources. We strongly believe that these drivers for adoption of IT staff augmentation will permit us and our industry to grow at attractive rates into the future.”
Revenue by segment
| (US$ thousands) | Q4 2016 | Q4 2015 | % change |
| Apex | $476,100 | $434,600 | 9.5% |
| Oxford | $144,800 | $142,900 | 1.3% |
Permanent placement revenue
| (US$ thousands) | Q4 2016 | Q4 2015 | % change |
| Apex | $10,000 | $10,700 | -6.5% |
| Oxford | $18,900 | $21,900 | -13.7% |
| Consolidated | $28,900 | $32,600 | -11.3% |
Gross margin by segment
| Q4 2016 | Q4 2015 | |
| Apex | 29.5% | 30.4% |
| Oxford | 39.9% | 42.7% |
Average bill rates
| Q4 2016 | Q4 2015 | |
| Apex | $56.57 | $54.83 |
| Oxford | $99.12 | $102.10 |
| Consolidated | $62.12 | $60.68 |
Full-year results
| (US$ thousands) | 2016 | 2015 | % growth |
| Revenue | $2,440,413 | $2,065,008 | 18.2% |
| Gross profit | $795,183 | $678,745 | 17.2% |
| Gross margin | 32.6% | 32.9% | |
| Net income | $97,201 | $97,650 | -0.5% |
Guidance
On Assignment estimates first-quarter revenue of $614.0 million to $624.0 million.
Share price and market cap
Shares in On Assignment rose 3.74% in early afternoon trading today to $47.16. The company had a market cap of $2.5 billion, according to Yahoo.