Net revenue edged down 0.7% at IT staffing provider TSR Inc. (NASD: TSRI) in its fiscal second quarter ended Nov. 30, reflecting a decrease in average billing rates for consultants and a higher discount plan put in place for a major customer.

The Hauppauge, NY-based company reported a net loss, noting that an increase in selling, general and administrative expenses of $594,000 created the swing from profit to loss for the quarter. CEO Christopher Hughes said the increase was due to the ongoing proxy contest.

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“The increase in [selling, general and administrative expenses] was due to a significant increase in professional and advisory fees in connection with various stockholder lawsuits and our ongoing contested proxy solicitation relating to our annual meeting, which we postponed to a date to be determined as a result of these lawsuits and the shareholder proposals to be brought before the annual meeting,” Hughes said.

TSR in December filed a complaint against several shareholders, alleging they violated federal securities laws by failing to disclose their formation of a group that intends to seize control of TSR. In November, TSR rejected a nonbinding buyout offer from shareholder QAR Industries. The company subsequently announced it will pursue at least one strategic acquisition following its review of strategic alternatives.

Share price and market cap

TSR shares were down 1.99% to $4.92 at 9:30 a.m. Eastern time; the company had a market cap of $9.85 million, according to FT.com.