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CBS/Staffmark revenue falls 10%

March 13 2009

Full-year 2008 revenue fell 10% year-over-year at commercial staffing firm Staffmark to $1.04 billion amid a difficult economic climate, according to a filing with the U.S. Securities and Exchange Commission. Staffmark represents the new brand name for CBS Personnel Holdings Inc. and Staffmark. CBS acquired Staffmark in January 2008, but announced the name change in February of this year. The change will be rolled out in the next 12 to 18 months.

The 10% decline is based on pro forma results — as if CBS and Staffmark had been a combined firm in 2007 as well as 2008, according to the filing.

Gross margin, on a pro forma basis, narrowed to 17.2% in 2008 from 17.5% in the previous year, the company reported. The lower margin was mainly the result of reduced direct hire staffing services.

2008 proved a difficult year for staffing, Staffmark's parent company, Compass Group Diversified Holdings LLC, said in its 10-K filing with the SEC.

"The most notable deterioration occurred in the fourth quarter of 2008 as the economic slowdown continued," according to Compass. "We believe the industry will continue to experience deterioration in temporary staffing through fiscal 2009."

Cincinnati-based CBS and Little Rock AR-based Staffmark separately ranked among the largest U.S. staffing firms based on 2007 revenue. The combined firm gets 71% of its revenue from industrial staffing; 21% from office/clerical; and the rest includes engineering and design, healthcare and other staffing as well as professional employer organization services.

Venturi Staffing, a division of CBS, will also take on the Staffmark name.

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