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CDI revenue falls 14%

February 23 2010

CDI Corp. (NYSE: CDI) reported fourth-quarter revenue fell 14.1% to $217.2 million from $253.6 million in the same period in the previous year. The company reported a fourth-quarter net loss of $6.9 million, and said the quarter included a $4.3 million charge after an investigation by the U.S. Department of Justice.

CDI, based in Philadelphia, provides engineering and information technology services as well as staffing.

Fourth-quarter revenue fell on a year-over-year basis in three of the company's four segments. Engineering solutions segment fourth-quarter revenue fell 19.2% to $114.9 million, Management Recruiters International revenue slipped 21.9% to $13.7 million and AndersElite revenue fell 35.6% to $23.2 million.

CDI's IT solutions revenue, however, rose 13.0% in the fourth quarter to $65.5 million from revenue of $57.9 million in the fourth quarter of 2008.

"Our IT solutions business experienced year-over-year revenue growth of 13.0% due to successful business development efforts and increased spending across most industry segments," said President and CEO Roger Ballou.

Fourth-quarter gross margin narrowed to 18.9% from 21.3% in the year-ago quarter.

The company posted a fourth-quarter net loss of $6.9 million compared with a net loss of $3.6 million in the same period last year. CDI said the net loss in the fourth quarter of 2009 included a $4.3 million charge following an investigation by the U.S. Department of Justice. The department had investigated a claim involving alleged mischarging of time on some federal government contracts, the company reported in its last 10-Q filing with the U.S. Securities and Exchange Commission.

Full-year 2009 revenue was $885.0 million, a decrease of 20.9% from $1.12 billion in 2008. Full-year gross margin fell to 20.0% from 22.8%.

CDI reported a net loss of $19.9 million in 2009 compared with net income of $19.4 million in 2008. The 2009 net loss included a $12.3 million charge related to a fine imposed by the UK's Office of Fair Trading.

The company estimates first-quarter 2010 revenue could fall 8% to 11% on a year-over-year basis.

CDI Corp. (NYSE: CDI)
For the fourth quarter ended Dec. 31, 2009, compared with the same period in the previous year.
Revenue: $217.2 million, -14.1%
Net loss: $6.9 million vs. net loss of $3.6 million

For the full year ended Dec. 31, 2009, compared with the previous y ear.
Revenue: $885.0 million, -20.9%
Net loss: $19.9 million vs. net income of $19.4 million

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