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On Assignment Revenue Rises 40%

October 28, 2011

On Assignment Inc. (NASD: ASGN), a Calabasas, Calif.-based life sciences, healthcare and technology staffing company, reported revenue rose 39.8 percent in the third quarter to $162.4 million from $116.1 million in the year-ago quarter.

Revenue rose by the double digits in all the company’s business lines:

  • Life sciences, up 39.1 percent to $41.8 million.
  • Total healthcare staffing, up 36.4 percent to $27.1 million. Allied healthcare revenue rose 15.5 percent to $11.7 million and nurse travel revenue rose 58.2 percent to $15.4 million.
  • Physician staffing, up 24.5 percent to $23.4 million, which includes two months’ revenue from the acquisition of Atlanta-based Healthcare Partners.
  • Information technology and engineering, up 47.7 percent to $70.1 million.

On Assignment’s third-quarter gross margin narrowed to 33.6 percent from 35.4 percent a year ago. Senior Vice President and CFO Jim Brill said the decrease in gross margin was due, in part, to a reduction in direct hire and conversion revenue as a percent of total revenue as well as an increase in lower-margin nurse travel revenue.

Net income jumped to $7.8 million from $3.2 million in the 2010 third quarter, an increase of 145.6 percent.

The company expects third-quarter revenue to be between $157 million and $159 million, a year-over-year increase of between 29.6 percent and 31.2 percent, and gross margin of about 33.2 percent.

On Assignment Inc. (NASD: ASGN)
For the quarter ended Sept. 30, 2011, compared with the year-ago quarter
Revenue: $162.4 million, +39.8 percent
Net income: $7.8 million, +$145.6 percent