Healthcare Staffing Report: March 27, 2014

Print

Cross Country revenue falls 2%, names new CFO

Cross Country Healthcare Inc. (NASD: CCRN) reported revenue fell by 2.3 percent in the fourth quarter and announced a new CFO. The Boca Raton, Fla.-based firm initially announced earnings on March 5, but issued a revised earnings statement on March 17 to reflect an increase of $17.4 million in the non-cash valuation allowance on deferred tax assets.

Cross Country posted revenue of $109.2 million in the fourth quarter, down from $111.7 million in the fourth quarter of the previous year.

Nurse and allied staffing revenue rose 0.5 percent in the fourth quarter to $71.2 million. In December, the company acquired the operating assets of On Assignment Inc.’s (NYSE: ASGN) allied healthcare staffing division.

Physician staffing fourth-quarter revenue fell 5.9 percent year over year to $28.9 million due to lower volume, partially offset by pricing improvement.

Cross Country’s other human capital management services revenue fell 11.1 percent year over year to $9.1 million in the fourth quarter. The segment includes retained search as well as education and training operations.

The company’s fourth-quarter gross margin improved to 26.2 percent from 25.0 percent in the same quarter last year.

Cross Country reported a net loss of $52.6 million for the fourth quarter 2013, revised upward from the initial announcement of $35.2 million on March 5. The company reported that management has concluded that a material weakness exists in the controls related to the company’s oversight and review of noncash and non-routine estimates. The company also announced management is taking steps to fix the weakness.

For the fourth quarter of 2012, the company has posted a net loss of $9.5 million.

Full-year revenue from services fell 1.0 percent to $438.3 million and the company reported a full-year net loss of $52.0 million compared to a net loss of $42.2 million in 2012.

Cross Country also named William Burns as its new CFO.

Burns had served as group vice president and corporate controller for Gartner Inc. since 2008. Prior to that he served as chief accounting officer for CA Technologies Inc.

Former CFO Emil Hensel will retire but will remain at Cross Country as a special advisor until June 3.