SOS Staffing Services, Inc. Reports First Quarter Results And Announces Board Changes

Management to Hold Conference Call Today at 9:00AM MDT (11:00AM EDT)



Apr 26, 2001, 01:00 ET from SOS Staffing Services, Inc.

    SALT LAKE CITY, April 26 /PRNewswire/ -- SOS Staffing Services, Inc.
 (Nasdaq:   SOSS) today reported operating results for the 13-week period ended
 April 1, 2001.
     Service revenues from continuing operations for the 13-week period ended
 April 1, 2001 were $68.7 million, compared to $80.3 million for the
 corresponding period of the prior fiscal year, a decrease of 14.4%.  The
 Company's service revenues were negatively impacted in the first quarter by
 the general economic slowdown.
     Loss from continuing operations for the 13-week period ended April 1, 2001
 was approximately ($308,000), or ($0.03) per diluted common share, compared to
 income from continuing operations of approximately $237,000, or $0.02 per
 diluted common share, for the corresponding period of the prior fiscal year.
 The loss from continuing operations is primarily attributable to the decrease
 in revenues, partially offset by lower operating expenses.  The loss from
 continuing operations also includes approximately $245,000 in restructuring
 costs attributable to closure of eight unprofitable branch offices in the
 first quarter.
     Net loss for the 13-week period ended April 1, 2001 was approximately
 ($834,000) or ($0.07) per diluted common share, compared to ($281,000) or
 ($0.02) per diluted common share, for the corresponding period of the prior
 fiscal year.  The net loss includes $526,000 from discontinued operations as a
 result of the sale in December 2000 of the consulting division of Inteliant
 Corporation, a wholly owned subsidiary of the Company.  The loss attributable
 to the 13-week period ended April 1, 2001 is due primarily to a change in the
 estimate of the realization of certain receivables retained in the sale of the
 consulting division.
     JoAnn Wagner, the Company's chairman, president and chief executive
 officer, stated, "We are aggressively reducing selling, general and
 administrative expenses in order to restore the Company to profitability in
 future quarters.  Additionally, the Company is pursuing opportunities to
 increase revenue by focusing on those business segments and geographical
 markets with greatest growth potential."
     Excluding any restructuring costs which may arise due to office closures
 and/or severance payments, the Company projects earnings per diluted common
 share for the second quarter of $0.00 to $0.04 and earnings for the fiscal
 year ending December 30, 2001 of $0.04 to $0.16.
     On April 11, 2001, the Board of Directors appointed Jack A. Henry as a
 director, replacing Samuel C. Freitag, who resigned on April 11, 2001.  Mr.
 Henry will serve on the compensation and audit committees of the Board of
 Directors.  Last year, Mr. Henry retired as the managing partner of the
 Phoenix, Arizona office of Arthur Andersen LLP, a position he had held for 18
 years.  Mr. Henry also served on Arthur Andersen's Nominating Committee and
 Chairman's Advisory Committee.  He currently serves on the board of directors
 of Harris Trust Bank of Arizona and Simula, Inc., a public corporation engaged
 in the manufacture of occupant safety systems for air, ground and sea
 vehicles.  In addition, Mr. Henry is Active in the Phoenix community.  He is
 president of the Greater Phoenix Leadership, co-chair of the Violence
 Prevention Initiative and sits on the City of Phoenix 2001 Bond Election
 Committee.  He also formerly served as chairman of the Arizona Chamber of
 Commerce.
     "The Company thanks Mr. Freitag for his service and contributions as a
 board member," said Ms. Wagner.  "We look forward to working with Mr. Henry in
 his role as director.  With his strong background and depth of experience, we
 believe he will be a valuable board member."
     On April 19, 2001, Richard J. Tripp resigned as a director of the Company
 effective April 20, 2001 as a result of the Company's elimination of his
 position as senior vice president.  Consequently, the Board of Directors
 reduced the number of directors from eight to seven.
     "We appreciate Mr. Tripp's many contributions to the Company over the
 years as an employee, officer and director, and we wish him the best in his
 future endeavors," stated Ms. Wagner.
     As previously announced, management of the Company will hold a conference
 call today, April 26, 2001 at 9:00 a.m. MDT (11:00 a.m. EDT).  The call will
 be broadcast live on the Internet and will be continuously rebroadcast on the
 Internet for ten days thereafter.  Interested parties may access the live web-
 cast on the Company's web site at http://www.sosstaffing.com or through Street
 Fusion at http://www.streetfusion.com.  Rebroadcasts are accessible at the
 same web sites.  Rebroadcasts are also available telephonically until midnight
 Wednesday, May 2, 2001 by dialing (800) 839-0860 and entering the code 1156.
     During the conference call Ms. Wagner and Kevin Hardy, senior vice
 president and chief financial officer, will report the Company's financial
 results for the 13 weeks ended April 1, 2001.  After the financial report, Ms.
 Wagner and Mr. Hardy will respond to questions from analysts regarding the
 report.  The analysts and Company management may also discuss the Company's
 operations, performance, financial results and other items that would assist
 the analysts and other interested parties in estimating the financial and
 operational performance of the Company in future periods.
 
     SOS Staffing Services, Inc., with its subsidiaries and divisions, is a
 provider of commercial and information technology staffing and employment-
 related services, operating through a network of approximately 135 offices.
 
     IMPORTANT NOTE:
     Statements in this press release that are not purely historical are
 forward-looking statements within the meaning of the Private Securities
 Litigation Reform Act of 1995.  Such statements, including earnings forecasts,
 encompass the Company's beliefs, expectations, hopes or intentions regarding
 future events.  Words such as "projects" "expects," "intends," "believes,"
 "anticipates," "likely," "hopes" and other similar words also identify
 forward-looking statements.  All forward-looking statements in this release
 are made as of the date hereof and are based on information available to the
 Company as of such date.  The Company assumes no obligation to update any
 forward-looking statement.  Readers are cautioned that all forward-looking
 statements involve risks, uncertainties and other factors that could cause the
 Company's actual results to differ materially from those anticipated in such
 statements including, without limitation, the Company's ability to attract and
 retain the staff, temporary and other employees needed to implement the
 Company's business plan and to meet customer needs, the Company's ability to
 integrate the operations of acquired businesses, economic fluctuations,
 existing and emerging competition, and changes in demands for the Company's
 services.  Risk factors, cautionary statements and other conditions, including
 economic, competitive, governmental, and technology factors that could cause
 actual results to differ from the Company's current expectations are discussed
 in the Company's Annual Report on Form 10-K and other reports filed with the
 Securities and Exchange Commission.
 
                          SOS STAFFING SERVICES, INC.
 
                 Summary Consolidated Statements of Operations
                                  (Unaudited)
                     (in thousands, except per share data)
 
                                                       Thirteen Weeks Ended
                                                     April 1,        April 2,
                                                       2001           2000
 
     SERVICE REVENUES                                 $68,702        $80,301
     DIRECT COST OF SERVICES                           54,255         62,086
      Gross profit                                     14,447         18,215
 
     OPERATING EXPENSES                                14,272         16,857
 
     INCOME FROM OPERATIONS                               175          1,358
     OTHER EXPENSE                                       (692)        (1,047)
 
     INCOME (LOSS) FROM CONTINUING
      OPERATIONS BEFORE INCOME TAXES                     (517)           311
 
     INCOME TAX BENEFIT (PROVISION)                       209           (74)
 
     INCOME (LOSS) FROM CONTINUING
      OPERATIONS                                         (308)           237
 
     LOSS FROM DISCONTINUED
      OPERATIONS (net of tax)                            (526)         (518)
 
     NET LOSS                                           $(834)         $(281)
 
     INCOME (LOSS) FROM CONTINUING
      OPERATIONS PER COMMON SHARE
       Basic                                           $(0.03)         $0.02
       Diluted                                          (0.03)          0.02
 
     NET LOSS PER COMMON SHARE
       Basic                                           $(0.07)        $(0.02)
       Diluted                                          (0.07)         (0.02)
 
     WEIGHTED AVERAGE COMMON SHARES
       Basic                                           12,691         12,691
       Diluted                                         12,691         12,691
 
 
                           SOS STAFFING SERVICES, INC.
                    Summary Consolidated Balance Sheet Data
                                  (Unaudited)
                                 (in thousands)
 
                                                  April 1,       December 31,
                                                    2001               2000
     ASSETS
       Current assets                             $46,099            $60,858
       Property & equipment, net                    5,557              4,322
       Intangible assets, net                      91,023             92,007
       Other assets                                 1,721              4,201
         Total assets                            $144,400           $161,388
 
     LIABILITIES & SHAREHOLDERS' EQUITY
       Current liabilities                        $24,818            $40,846
       Long-term debt                              27,000             27,000
       Other long-term liabilities                  2,531              2,657
       Shareholders' equity                        90,051             90,885
         Total liabilities &
          shareholders' equity                   $144,400           $161,388
 
 
                            Summary Segment Information
                                    (Unaudited)
                                   (in thousands)
 
                                                     Thirteen Weeks Ended
                                               April 1, 2001     April 2, 2000
 
     SERVICE REVENUES
       Commercial                                $58,610            $67,036
       IT                                         10,092             13,279
       Other (unallocated)                            --                (14)
         Total service revenues                  $68,702            $80,301
 
     INCOME FROM OPERATIONS
       Commercial                                 $1,124             $2,252
       IT                                             29                327
       Other (unallocated)                          (978)            (1,221)
         Total income from operations               $175             $1,358
 
 
                                              April 1, 2001  December 31, 2000
     IDENTIFIABLE ASSETS
       Commercial                                $83,815             $94,901
       IT                                         54,296              60,423
       Other (unallocated)                         6,289               6,064
         Total assets                           $144,400            $161,388
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X92387825
 
 

SOURCE SOS Staffing Services, Inc.
    SALT LAKE CITY, April 26 /PRNewswire/ -- SOS Staffing Services, Inc.
 (Nasdaq:   SOSS) today reported operating results for the 13-week period ended
 April 1, 2001.
     Service revenues from continuing operations for the 13-week period ended
 April 1, 2001 were $68.7 million, compared to $80.3 million for the
 corresponding period of the prior fiscal year, a decrease of 14.4%.  The
 Company's service revenues were negatively impacted in the first quarter by
 the general economic slowdown.
     Loss from continuing operations for the 13-week period ended April 1, 2001
 was approximately ($308,000), or ($0.03) per diluted common share, compared to
 income from continuing operations of approximately $237,000, or $0.02 per
 diluted common share, for the corresponding period of the prior fiscal year.
 The loss from continuing operations is primarily attributable to the decrease
 in revenues, partially offset by lower operating expenses.  The loss from
 continuing operations also includes approximately $245,000 in restructuring
 costs attributable to closure of eight unprofitable branch offices in the
 first quarter.
     Net loss for the 13-week period ended April 1, 2001 was approximately
 ($834,000) or ($0.07) per diluted common share, compared to ($281,000) or
 ($0.02) per diluted common share, for the corresponding period of the prior
 fiscal year.  The net loss includes $526,000 from discontinued operations as a
 result of the sale in December 2000 of the consulting division of Inteliant
 Corporation, a wholly owned subsidiary of the Company.  The loss attributable
 to the 13-week period ended April 1, 2001 is due primarily to a change in the
 estimate of the realization of certain receivables retained in the sale of the
 consulting division.
     JoAnn Wagner, the Company's chairman, president and chief executive
 officer, stated, "We are aggressively reducing selling, general and
 administrative expenses in order to restore the Company to profitability in
 future quarters.  Additionally, the Company is pursuing opportunities to
 increase revenue by focusing on those business segments and geographical
 markets with greatest growth potential."
     Excluding any restructuring costs which may arise due to office closures
 and/or severance payments, the Company projects earnings per diluted common
 share for the second quarter of $0.00 to $0.04 and earnings for the fiscal
 year ending December 30, 2001 of $0.04 to $0.16.
     On April 11, 2001, the Board of Directors appointed Jack A. Henry as a
 director, replacing Samuel C. Freitag, who resigned on April 11, 2001.  Mr.
 Henry will serve on the compensation and audit committees of the Board of
 Directors.  Last year, Mr. Henry retired as the managing partner of the
 Phoenix, Arizona office of Arthur Andersen LLP, a position he had held for 18
 years.  Mr. Henry also served on Arthur Andersen's Nominating Committee and
 Chairman's Advisory Committee.  He currently serves on the board of directors
 of Harris Trust Bank of Arizona and Simula, Inc., a public corporation engaged
 in the manufacture of occupant safety systems for air, ground and sea
 vehicles.  In addition, Mr. Henry is Active in the Phoenix community.  He is
 president of the Greater Phoenix Leadership, co-chair of the Violence
 Prevention Initiative and sits on the City of Phoenix 2001 Bond Election
 Committee.  He also formerly served as chairman of the Arizona Chamber of
 Commerce.
     "The Company thanks Mr. Freitag for his service and contributions as a
 board member," said Ms. Wagner.  "We look forward to working with Mr. Henry in
 his role as director.  With his strong background and depth of experience, we
 believe he will be a valuable board member."
     On April 19, 2001, Richard J. Tripp resigned as a director of the Company
 effective April 20, 2001 as a result of the Company's elimination of his
 position as senior vice president.  Consequently, the Board of Directors
 reduced the number of directors from eight to seven.
     "We appreciate Mr. Tripp's many contributions to the Company over the
 years as an employee, officer and director, and we wish him the best in his
 future endeavors," stated Ms. Wagner.
     As previously announced, management of the Company will hold a conference
 call today, April 26, 2001 at 9:00 a.m. MDT (11:00 a.m. EDT).  The call will
 be broadcast live on the Internet and will be continuously rebroadcast on the
 Internet for ten days thereafter.  Interested parties may access the live web-
 cast on the Company's web site at http://www.sosstaffing.com or through Street
 Fusion at http://www.streetfusion.com.  Rebroadcasts are accessible at the
 same web sites.  Rebroadcasts are also available telephonically until midnight
 Wednesday, May 2, 2001 by dialing (800) 839-0860 and entering the code 1156.
     During the conference call Ms. Wagner and Kevin Hardy, senior vice
 president and chief financial officer, will report the Company's financial
 results for the 13 weeks ended April 1, 2001.  After the financial report, Ms.
 Wagner and Mr. Hardy will respond to questions from analysts regarding the
 report.  The analysts and Company management may also discuss the Company's
 operations, performance, financial results and other items that would assist
 the analysts and other interested parties in estimating the financial and
 operational performance of the Company in future periods.
 
     SOS Staffing Services, Inc., with its subsidiaries and divisions, is a
 provider of commercial and information technology staffing and employment-
 related services, operating through a network of approximately 135 offices.
 
     IMPORTANT NOTE:
     Statements in this press release that are not purely historical are
 forward-looking statements within the meaning of the Private Securities
 Litigation Reform Act of 1995.  Such statements, including earnings forecasts,
 encompass the Company's beliefs, expectations, hopes or intentions regarding
 future events.  Words such as "projects" "expects," "intends," "believes,"
 "anticipates," "likely," "hopes" and other similar words also identify
 forward-looking statements.  All forward-looking statements in this release
 are made as of the date hereof and are based on information available to the
 Company as of such date.  The Company assumes no obligation to update any
 forward-looking statement.  Readers are cautioned that all forward-looking
 statements involve risks, uncertainties and other factors that could cause the
 Company's actual results to differ materially from those anticipated in such
 statements including, without limitation, the Company's ability to attract and
 retain the staff, temporary and other employees needed to implement the
 Company's business plan and to meet customer needs, the Company's ability to
 integrate the operations of acquired businesses, economic fluctuations,
 existing and emerging competition, and changes in demands for the Company's
 services.  Risk factors, cautionary statements and other conditions, including
 economic, competitive, governmental, and technology factors that could cause
 actual results to differ from the Company's current expectations are discussed
 in the Company's Annual Report on Form 10-K and other reports filed with the
 Securities and Exchange Commission.
 
                          SOS STAFFING SERVICES, INC.
 
                 Summary Consolidated Statements of Operations
                                  (Unaudited)
                     (in thousands, except per share data)
 
                                                       Thirteen Weeks Ended
                                                     April 1,        April 2,
                                                       2001           2000
 
     SERVICE REVENUES                                 $68,702        $80,301
     DIRECT COST OF SERVICES                           54,255         62,086
      Gross profit                                     14,447         18,215
 
     OPERATING EXPENSES                                14,272         16,857
 
     INCOME FROM OPERATIONS                               175          1,358
     OTHER EXPENSE                                       (692)        (1,047)
 
     INCOME (LOSS) FROM CONTINUING
      OPERATIONS BEFORE INCOME TAXES                     (517)           311
 
     INCOME TAX BENEFIT (PROVISION)                       209           (74)
 
     INCOME (LOSS) FROM CONTINUING
      OPERATIONS                                         (308)           237
 
     LOSS FROM DISCONTINUED
      OPERATIONS (net of tax)                            (526)         (518)
 
     NET LOSS                                           $(834)         $(281)
 
     INCOME (LOSS) FROM CONTINUING
      OPERATIONS PER COMMON SHARE
       Basic                                           $(0.03)         $0.02
       Diluted                                          (0.03)          0.02
 
     NET LOSS PER COMMON SHARE
       Basic                                           $(0.07)        $(0.02)
       Diluted                                          (0.07)         (0.02)
 
     WEIGHTED AVERAGE COMMON SHARES
       Basic                                           12,691         12,691
       Diluted                                         12,691         12,691
 
 
                           SOS STAFFING SERVICES, INC.
                    Summary Consolidated Balance Sheet Data
                                  (Unaudited)
                                 (in thousands)
 
                                                  April 1,       December 31,
                                                    2001               2000
     ASSETS
       Current assets                             $46,099            $60,858
       Property & equipment, net                    5,557              4,322
       Intangible assets, net                      91,023             92,007
       Other assets                                 1,721              4,201
         Total assets                            $144,400           $161,388
 
     LIABILITIES & SHAREHOLDERS' EQUITY
       Current liabilities                        $24,818            $40,846
       Long-term debt                              27,000             27,000
       Other long-term liabilities                  2,531              2,657
       Shareholders' equity                        90,051             90,885
         Total liabilities &
          shareholders' equity                   $144,400           $161,388
 
 
                            Summary Segment Information
                                    (Unaudited)
                                   (in thousands)
 
                                                     Thirteen Weeks Ended
                                               April 1, 2001     April 2, 2000
 
     SERVICE REVENUES
       Commercial                                $58,610            $67,036
       IT                                         10,092             13,279
       Other (unallocated)                            --                (14)
         Total service revenues                  $68,702            $80,301
 
     INCOME FROM OPERATIONS
       Commercial                                 $1,124             $2,252
       IT                                             29                327
       Other (unallocated)                          (978)            (1,221)
         Total income from operations               $175             $1,358
 
 
                                              April 1, 2001  December 31, 2000
     IDENTIFIABLE ASSETS
       Commercial                                $83,815             $94,901
       IT                                         54,296              60,423
       Other (unallocated)                         6,289               6,064
         Total assets                           $144,400            $161,388
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X92387825
 
 SOURCE  SOS Staffing Services, Inc.