Revenue up 28% Year over
Year
Gross Margins Improve by 800
Basis Points
ATLANTA, GA /
ACCESSWIRE / November 11, 2014 / Labor SMART, Inc. (LTNC)
(the "Company"), a leader in providing on-demand blue collar
staffing primarily in the southeastern United States, today
announced it has filed its 10Q for the quarter ending September 26,
2014. The company will host its third quarter earnings call on
November 13, 2014 at 4:30pm EDT.
Third Quarter 2014 Highlights:
- Revenues up 28% to $6.8 million vs. $5.3 million a year
ago
- Same branch revenue up 12.5% year-over-year
- Gross profit margins improve to 25% vs. 17% a year ago
- Added 315 new customers
- EBITDA* of $121,577
- Adjusted EBITDA* of $344,731
- 30 branches, up from 15 at year end 2013
"I am very pleased with our financial results from the third
quarter," said Ryan Schadel, President and CEO of Labor SMART. "The
Labor SMART team delivered on all of our key metrics. Becoming
substantially self-insured, combined with our culling of low margin
accounts this summer has boosted our gross profit margins above
internal expectations. I am also pleased with our growth as
reflected in our EBITDA of $121,577. The attainment of positive
EBITDA for two consecutive quarters evidences our business strategy
is paying off." Schadel added that the company continues to grow
and is working to strengthen its presence, management team,
financial resources and capital structure.
During the remainder of 2014, Labor SMART does not expect to
open any new branches, however, it is aggressively pursuing
acquisitions that fit well with its culture and will continue to
seek more acquisition opportunities than in prior years. This major
shift in focus is directly related to the new large deductible
worker's compensation policy. The industry is very fragmented. The
Company has invested heavily in its corporate infrastructure in the
last two years and believes it can execute acquisitions to
immediately recognize economies of scale. Labor SMART believes it
can successfully execute and close acquisitions totaling $20-$40
million in revenue in 2015.
Financial Results:
Third Quarter 2014 Compared to Third Quarter
2013
Revenue for the three months ended September 26, 2014 increased
28% to $6.8 million as compared to $5.3 million for the three
months ended September 30, 2013. This increase was due to improved
revenue from existing branches and the opening of new branches in
the first half of fiscal 2014 as well as our acquisition of
Shirley's Employment. Of the 15 branches that were open at
September 30, 2013, revenue for the three months ended September
26, 2014 was $6.0 million, representing a 12.50% increase in same
branch revenue in a year-over-year comparison.
Gross profit margin improved 800 basis points to 25% for the
three months ended September 26, 2014, from 17% for the three
months ended September 30, 2013.
Operating loss for the third quarter of 2014 was $0.1 million,
an improvement from $0.2 million in the third quarter of 2013. Net
loss for the third quarter of 2014 was $1.1 million, an increase
from $0.4 million in the third quarter of 2013. This net loss
increase was due to non-cash interest and finance expense offset by
gain on change in fair value in derivative liability of $1.0
million. In the comparable third quarter 2013, such non-cash
interest and finance expense and gain on change in fair value in
derivative liability was $0.3 million. The resulting EPS is
($0.04), as compared to ($0.02) a year earlier, due to an increase
in average shares outstanding to 26.8 million, from 19.4
million.
Year-to-Date 2014 Compared to Year-to-Date
2013
Revenue for the nine months ended September 26, 2014 increased
52% to $18.1 million as compared to $11.9 million for the nine
months ended September 30, 2013.
Gross profit margin improved 700 basis points to 23% for the
nine months ended September 26, 2014, from 16% for the nine months
ended September 30, 2013.
Operating loss for the nine months ended September 26, 2014 was
$0.5 million, an improvement from $1.1 million in the nine months
ended September 30, 2013. Net loss for the nine months ended
September 26, 2014 was $3.1 million, an increase from $1.8 million
in the nine months ended September 30, 2013. This net loss increase
was due to non-cash interest and finance expense offset by gain on
change in fair value in derivative liability of $2.6 million. In
the comparable third quarter 2013, such non-cash interest and
finance expense and gain on change in fair value in derivative
liability was $0.7 million. The resulting EPS is ($0.13), as
compared to ($0.10) a year earlier, due to an increase in average
shares outstanding to 23.7 million, from 19.0 million.
During Thursday's earnings call management is expected to
discuss the reported third quarter results as well as other
developments at the company. Callers may dial toll-free
844-831-4027 with conference ID: 34514379 or listen online at
http://www.media-server.com/m/p/z6r4xuwg.
*EBITDA and Adjusted EBITDA are non-GAAP financial measures for
which a reconciliation is provided as part of this press release
and filed on Form 10Q.
Labor SMART, Inc.
Adjusted Earnings before Interest, Taxes, Depreciation and
Amortization (EBITDA)
September 26, 2014
|
Three Months Ended September 26, 2014
|
GAAP, net loss
|
$ (1,087,328)
|
Add:
|
|
Provision for income taxes
|
-
|
Interest and finance expense, net
|
1,165,075
|
Depreciation and amortization
|
43,830
|
EBITDA
|
121,577
|
Non-recurring acquisition and expansion costs
|
223,154
|
Adjusted EBITDA
|
$ 344,731
|
About Labor SMART, Inc.
Labor SMART, Inc. provides On-Demand temporary labor to a
variety of industries. The Company's clients range from small
businesses to Fortune 100 companies. Labor SMART was founded to
provide reliable, dependable and flexible resources for on-demand
personnel to small and large businesses in areas that include
construction, manufacturing, hospitality, event-staffing,
restoration, warehousing, retailing, disaster relief and cleanup,
demolition and landscaping. Labor SMART believes it can make a
positive contribution each and every day for the benefit of its
clients and temporary employees. The Company's mission is to be the
provider of choice to its growing portfolio of customers with a
service-focused approach that enables Labor SMART to be seen as a
resource and partner to its clients.
Safe Harbor Statement
This release contains statements that constitute forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. These statements appear in a number of places
in this release and include all statements that are not statements
of historical fact regarding the intent, belief or current
expectations of Labor SMART, Inc., its directors or its officers
with respect to, among other things: (i) financing plans; (ii)
trends affecting its financial condition or results of operations;
(iii) growth strategy and operating strategy. The words "may",
"would", "will", "expect", "estimate", "can", "believe",
"potential", and similar expressions and variations thereof are
intended to identify forward-looking statements. Investors are
cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks and
uncertainties, many of which are beyond Labor SMART, Inc.'s ability
to control, and that actual results may differ materially from
those projected in the forward-looking statements as a result of
various factors. More information about the potential factors that
could affect the business and financial results is and will be
included in Labor SMART, Inc.'s filings with the U.S. Securities
and Exchange Commission.
Contacts:
Hayden IR
917-658-7878
hart@haydenir.com
Beverly Jedynak
Martin E. Janis & Company, Inc.
312-943-1123
bjedynak@janispr.com
SOURCE: Labor SMART, Inc.
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