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AMN profit falls 10%

February 27 2008

Fourth-quarter net income fell 10.4% at AMN Healthcare Services Inc. (NYSE: AHS). The country's largest healthcare staffing firm posted profit of $9.0 million, down from $10.0 million in the year-ago quarter.

Revenue, however, rose 0.8% in the fourth quarter to $285.9 million from $283.5 million a year ago. Analysts had estimated fourth-quarter revenue of $287.7 million.

Fourth-quarter income from operations fell 17.4% year-over-year at the San Diego-based company. Its operating margin slipped to 5.9% from 7.2%. AMN said the 2006 quarter included a $2.9 million boost from an adjustment to its professional liability insurance reserve. The company also reported $700,000 in restructuring costs for its O'Grady Peyton International nurse staffing division in the fourth quarter of 2007.

Gross margin improved to 26.6% from 26.2%.

Nurse and allied healthcare staffing revenue at AMN fell 2.7% in the fourth quarter to $196.7 million. Also, physician permanent placement revenue slipped 2.1% to $13.1 million. However, fourth-quarter locum tenens revenue rose 11.8% to $76.2 million.

Full-year 2007 net income rose 4.1% to $36.5 million from $35.1 million in 2006.

Revenue for 2007 increased 7.6% to $1.16 billion from $1.08 billion in 2006. Gross margin narrowed to 26.0% from 26.7%.

AMN gave first-quarter 2008 revenue guidance of $290 million to $293 million. The guidance includes its recent acquisition of healthcare staffing firm Platinum Select LP. Analysts had estimated first-quarter revenue of $293.15 million.

"Our 2008 guidance anticipates revenue and earnings growth in all of our segments," said President and CEO Susan Nowakowski. "Our locum tenens staffing segment is expected to produce double-digit growth and we expect that our physician permanent placement and allied staffing business will grow at faster rates than last year. Our outlook is tempered by caution that the level of growth in the demand environment for travel nurses continues to be at lower-than-optimal levels."

AMN Healthcare Services Inc. (NYSE: AHS)
For the fourth quarter ended Dec. 31, 2007, compared with the same period in 2006.
Revenue: $285.9 million, +0.8%
Net income: $9.0 million, -10.4%

For full-year 2007 ended Dec. 31, 2007, compared with the previous year.
Revenue: $1.16 billion, +7.6%
Net income: $36.5 million, +4.1%

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