Kforce Inc. (KFRC) has reported 22.37 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $9.24 million, or $0.36 a share in the quarter, compared with $11.90 million, or $0.43 a share for the same period last year.
Revenue during the quarter went down marginally by 0.52 percent to $326 million from $327.70 million in the previous year period. Gross margin for the quarter contracted 102 basis points over the previous year period to 30.57 percent. Total expenses were 95.25 percent of quarterly revenues, up from 93.78 percent for the same period last year. That has resulted in a contraction of 147 basis points in operating margin to 4.75 percent.
Operating income for the quarter was $15.48 million, compared with $20.38 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $19.17 million compared with $24.56 million in the prior year period. At the same time, adjusted EBITDA margin contracted 161 basis points in the quarter to 5.88 percent from 7.49 percent in the last year period.
David L. Dunkel, chairman and chief executive officer, said, "As anticipated, revenue in the fourth quarter returned to year-over-year billing day growth. Our intra-quarter trends as well as the momentum we have carried into the beginning of the first quarter are providing encouraging signs about our ability to continue accelerating revenue growth in 2017. We are confident in the structure and strength of our organization and believe that the actions taken during 2016 position us well to maximize our market opportunities."
For the first-quarter, Kforce projects revenue to be in the range of $330 million to $335 million. The company projects operating income to grow in the range of 3 percent to 3.30 percent. The company forecasts diluted earnings per share to be in the range of $0.22 to $0.24.
Working capital increases
Kforce Inc. has recorded an increase in the working capital over the last year. It stood at $140.15 million as at Dec. 31, 2016, up 10.54 percent or $13.36 million from $126.79 million on Dec. 31, 2015. Current ratio was at 2.68 as on Dec. 31, 2016, up from 2.44 on Dec. 31, 2015.
Debt increases substantially
Kforce Inc. has witnessed an increase in total debt over the last one year. It stood at $115.53 million as on Dec. 31, 2016, up 37.83 percent or $31.71 million from $83.82 million on Dec. 31, 2015. Kforce has witnessed an increase in long-term debt over the last one year. It stood at $115.53 million as on Dec. 31, 2016, up 37.83 percent or $31.71 million from $83.82 million on Dec. 31, 2015. Total debt was 31.62 percent of total assets as on Dec. 31, 2016, compared with 23.83 percent on Dec. 31, 2015. Debt to equity ratio was at 0.95 as on Dec. 31, 2016, up from 0.60 as on Dec. 31, 2015.
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