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CDI Corp. (NYSE: CDI) said today it expects to report a fourth-quarter revenue decline of between 15% and 16% from the same period a year ago (9% on a constant currency basis). It previously estimated a revenue decline of between 9% and 12% (or 4% to 6% on a constant currency basis).
In addition, the company said it plans to announce pre-tax operating losses from continuing operations of between $2.6 million and $2.8 million.
CDI said it expects to pay $1.8 million severance payments, real estate exit costs and other costs related to the termination of its largest master franchise agreement for its MRI segment. CDI has also increased its reserve for potential credit losses of $2.5 million because of a bankruptcy of a large client, and it's taking $500,000 in expenses for costs associated with an acquisition effort that was unsuccessful.
"We experienced a rapid deceleration in permanent placement revenue in our AndersElite segment and in our recruitment process outsourcing business within the engineering solutions segment," said President and CEO Roger Ballou. "We also saw weakness in permanent placement demand in certain industries served by our Management Recruiters International segment resulting in reduced royalty payments."
Ballou also said the company saw significant staffing reductions at some chemical and industrial clients of its engineering solutions segment.