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TeamStaff revenue slips, profit up

February 17 2009

TeamStaff Inc. (NASD: TSTF), a Somerset NJ-based healthcare and administrative staffing firm, announced a decline in fiscal first-quarter revenue, but said gross margin and net income both rose.

TeamStaff reported revenue of $14.7 million in its fiscal first quarter ended Dec. 31, down 5.0% from $15.5 million in the first quarter of the previous year. However, President and CEO Rick Filippelli said the company's TeamStaff GS government staffing business posted a 10% increase in revenue year-over-year.

On the other hand, tight economic conditions have hit its non-government TeamStaff Rx subsidiary, Filippelli said.

"On the demand side, hospitals have cut spending with certain hospitals reducing the length of contracts," he said. "On the supply side, we are seeing more travelers prefer the stability of permanent employment during these tough economic times. In addition to a weak economy, our travel segment experiences a seasonal downturn during our first fiscal quarter. Many travelers choose not to take assignments between Thanksgiving and New Year's."

First-quarter gross margin rose to 18.6% from 18.0% in the same period a year ago.

Net income rose 37.1% to $48,000 from $35,000 in the year-ago period.

TeamStaff Inc. (NASD: TSTF)
For the fiscal first quarter ended Dec. 31, 2008, compared with the same period in the previous year.
Revenue: $14.7 million, -5.0%
Net income: $48,000, +37.1%

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