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Kforce Inc. (NASD: KFRC) reported third-quarter revenue increased 10.9 percent year over year to $299.7 million. Growth came across business lines with its technology segment posting the fastest growth. The Tampa, Fla.-based professional staffing provider also announced plans for a realignment in the fourth quarter that will bring costs in the range of $6 million to $7 million related to severance, benefits and other costs.
“Third quarter revenue and earnings represent historical highs for the firm,” said Chief Financial Officer David Kelly. “As we look forward, we believe sustained revenue growth along with the operating leverage in our recently realigned operating platform and our significantly productive revenue responsible team will allow us to exceed prior peak operating margins more quickly.”
Technology revenue rose 13.5 percent in the third quarter to $193.6 million. The growth came in technology flexible staffing, where revenue rose 14.2 percent to $188.9 million. Technology search revenue fell 10.3 percent to $4.7 million.
“Technology demand remains strong as we continue to see a secular shift where our clients are increasingly utilizing staffing to meet their requirements, particularly in this highly project driven environment,” said Chairman and CEO David Dunkel. “We remain confident in our strategic direction and believe there are significant opportunities in a growing domestic professional staffing market as Kforce has only a 3 percent market share.”
Revenue also rose in Kforce’s other segments compared to last year’s third quarter:
- Technology: Up 13.5 percent to $193.6 million
- Finance and accounting: Up 6.0 percent to $62.2 million
- Health information management: Up 8.5 percent to $19.7 million
- Government solutions: Up 6.3 percent to $24.1 million
The company’s third-quarter gross margin narrowed to 32.5 percent from 32.9 percent in the same quarter last year.
Kforce posted net income of $9.0 million in the third quarter, down 3.1 percent from $9.3 million in the year-ago quarter.
Kforce ranks No. 15 on Staffing Industry Analysts’ 2013 list of largest U.S. staffing firms.
Kforce Inc. (NASD: KFRC)
For the third quarter ended Sept. 30, 2013, compared with the same period in the previous year.
Revenue: $299.7 million, +10.9 percent
Net income: $9.0 million, -3.1 percent