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Medical Staffing Network is restructuring

October 31 2008

Medical Staffing Network Holdings Inc. (NYSE: MRN) announced Thursday that it is realigning its per diem branch network. The company will increasingly focus on expanding its local contract business, which now amounts to 25% of its per diem division's revenue. In addition, with six new vendor management contracts, the company is focusing on that area.

As of Oct. 28, Medical Staffing is consolidating its national branches by closing 20 per diem locations where local contract and VMS business opportunities are less evident. A majority of these closed branches will be serviced either from a nearby location or from a "virtual" office setting from the company's corporate location.

Medical Staffing anticipates that the loss of the closed locations' income from operations will be entirely offset by a reduction in salaries and related expenses for operations and corporate personnel. The company expects to incur a charge of approximately $6.7 million in the fourth quarter of 2008. The charge will be comprised of about $1.0 million relating to severance costs and lease termination and about $5.7 million in non-cash goodwill impairment relating to the closure of the branches.

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