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Computer Task Group profit rises 25.1%

April 24 2008

First-quarter net income rose 25.1% at information technology services and staffing firm Computer Task Group Inc. (NASD: CTGX). The Buffalo NY-based company posted net income of $1.4 million, compared to $1.1 million in the first quarter of last year.

"Our first-quarter results reflect growth in the sales of recently launched solutions that we offer to the healthcare industry," said CTG Chairman and CEO James Boldt. "In the 2008 first quarter, healthcare represented 27% of our business, up from 25% for the 2007 full year. Our overall solutions revenue increased 9% in the 2008 first quarter over last year's first quarter."

Solutions revenue totaled 34% of total revenue for the company while staffing revenue totaled 66%, according to the company. CTG's staffing first-quarter staffing revenue rose 7.9% to $57.2 million.

Overall first-quarter revenue for the company rose 8.3% to $86.7 million from $80.0 million in the same period last year.

Gross margin slipped to 21.6% from 21.8%.

CTG's estimated revenue of $88 million to $90 million in the second quarter is 10% to 12% above the second quarter of last year, the company said.

"CTG's success in building our higher margin solutions business, particularly in the healthcare market, is driving our current and projected growth in revenue and profitability," Boldt said.

Computer Task Group Inc. (NASD: CTGX)
For the first quarter ended March 28, 2008, compared with the same period in 2007.
Revenue: $86.7 million, +8.3%
Net income: $1.4 million, +25.1%

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