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Q4 revenue estimate lower at On Assignment

December 03 2013

On Assignment Inc. (NYSE: ASGN) lowered its fourth-quarter revenue estimate to between $418 million to $422 million despite Monday’s announced acquisitions of CyberCoders Holdings Inc. and Whitaker Medical LLC.

The company cited several reasons for the lowered revenue estimate, including the loss of its largest customer in its Oxford division. Oxford’s largest customer represented revenue of $5.9 million in the fourth quarter of 2012 and $2.6 million in the third quarter of this year.

On Assignment also cited a higher-than-expected revenue drop in Oxford’s Healthcare IT Group with a number of projects delayed until the first quarter. In addition, the company reported slower-than-expected growth in new practices and disciplines and fewer-than-expected client billing days because of the Christmas and New Year’s holidays.

However, President and CEO Peter Dameris said in a conference call with analysts that its Apex information technology staffing division and its life sciences division are growing faster than expected.

The fourth-quarter revenue estimate of between $418 million and $422 million include the results of CyberCoders and Whitaker based on the date of their acquisitions. Revenue of On Assignment’s allied healthcare staffing business is not included in the new estimate because of the sale, although it was included in the previous estimate.

On Assignment previously estimated fourth-quarter revenue of between $429 million and $433 million.

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