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Cross Country Revenue Falls 8%

March 09 2011

Cross Country Healthcare Inc. (NASD: CCRN), a Boca Raton, Fla.-based healthcare staffing firm, reported fourth-quarter revenue fell 8.4 percent to $113.7 million compared to the year-ago quarter.

"The fourth quarter of 2010 appears to be the nadir of the most challenging period in our company's history as our revenue expectation is for solid sequential growth in the first quarter of 2011," said Joseph Boshart, president and CEO. "I continue to believe our strategy and operating discipline has put us in an attractive position relative to our major competitors."

Nurse and allied staffing revenue of fell 9.1 percent year over year to $59.4 million, though it marked a sequential uptick of 2 percent. Boshart noted current demand for travel nurses has doubled over year-ago levels, although it remains well below historical levels, and notes that its managed service provider solution accounts for approximately 30 percent of its nurse and allied full-time equivalents.

Fourth-quarter physician staffing revenue fell 16.1 percent year over year to $27.9 million. The company said decreased demand for temporary physicians is likely due to the lingering effects of the recession, the weak housing market (which continue to delay the retirement plans of many physicians), as well as a trend in which hospitals have had increased success in directly hiring physicians.

Fourth-quarter revenue for the company's clinical trial services segment rose 3.0 percent to $15.3 million year over year. Meanwhile, the company's other human capital management services business revenue rose 3.9 percent to $11.1 million.

Gross margin in the fourth quarter rose to 28.7 percent from 28.3 percent in the year-ago quarter.

Fourth-quarter net loss was $6.0 million. Adjusted net income, a non-GAAP financial, was $600,000, and excluded $6.6 million of after-tax trademark impairment charges related to the company's Medical Doctor Associates acquisition. Net income was $398,000 in the year-ago quarter.

Revenue for the year ended Dec. 31, 2010, fell 19.0 percent to $468.6 million. Net loss was $2.8 million in 2010. Net income was $6.7 million in 2009. Gross margin was 28.2 percent in 2010, up from 26.5 percent in 2009.

The company expects first-quarter revenue of between $119.0 million to $121.0 million and gross margin of between 26.5 percent and 27.0 percent. Revenue was $121.4 million in the year-ago first quarter.

Cross Country Healthcare Inc. (NASD: CCRN)
For the fourth quarter ended Dec. 31, 2010, compared with the same period in 2009.
Revenue: $113.7 million, -8.4 percent
Net loss: $6.0 million vs. net income of $398,000

For full-year 2010, ended Dec. 31, 2010, compared with the previous year.
Revenue: $468.6 million, -19.0 percent
Net loss: $2.8 million vs. net income of $6.7 million

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