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Staffing 360’s fiscal Q2 revenue jumps with acquisitions

January 21, 2015

Staffing 360 Solutions Inc.’s (OTCBB: STAF) sales rose to $33.9 million in its fiscal second quarter ended Nov. 30, up from $2.0 million in the second quarter of the previous year.

The company reported acquisition strategy fueled the revenue growth. Staffing 360 completed three acquisitions since the year-ago quarter ended. They include Initio International Holdings Limited, Poolia’s UK subsidiary and PeopleSERVE.

However, it reported a second-quarter net loss of $8.8 million in the quarter compared with a net loss of $1.4 million in the same quarter of 2014.

The New York-based staffing provider was founded in 2012.

Quote

“Our highly selective acquisition strategy has fueled our growth over the past year," said CFO Jeff Mitchell. “From a revenue perspective, the $33.9 million we generated in our most recent quarter is consistent with what is expected on a quarterly basis going forward, prior to additional acquisitions that we may close. Although we reported a net loss of approximately $8.8 million, approximately $7.9 million is attributable to non-cash charges, including $5.2 million of non-cash restructuring expenses as part of our Pathway to Profitability. Our mission is to continue to raise capital and acquire additional staffing companies, in order to contribute to our bottom line. Going forward, our fiscal Q3 results will likely see a sequential dip in revenue due to the seasonality of the winter weather and its effect on our business, especially in the Northeast, but this is always the case and we expect to report improvements on a year-over-year basis.”

Revenue

  Q2 2015 (000s) Q2 2014 (000s) % growth
Sales $33,938 $1,964 nm

Gross margin

  Q2 2015  Q2 2014 
Gross margin 18.0% 32.2%

Net loss

  Q2 2015 (000s) Q2 2014 (000s) % growth
Net loss -$8,737 -$1,424 nm

Share price and market cap

Shares in Staffing 360 fell 9.04% in early afternoon trading today to 50 cents and Staffing 360 has a market cap of approximately $18.88 million, according to Yahoo!