Stock Watch: Kforce Falls After Q2 Report

Kforce.com Inc. (Nasdaq: KFRC) fell 1 9/16 to 5 Wednesday, after the Internet employment agency reported slight gains in revenue and earnings for the second quarter.

The Tampa, Florida-based Kforce said revenue for the quarter rose to $197.7 million (US$) from $189.4 million in the same period a year earlier. Net income before special costs totaled $2.8 million, or 6 cents per share, up from $300,000, or 1 cent, in the year-earlier quarter. After a $1.2 million charge for job cuts and a $500,000 charge for a change in plans regarding a new headquarters building, net income in the latest quarter totaled $1.8 million, or 4 cents per share.

The staff cuts, along with a decision to slow spending on advertising, will “positively impact the bottom line in future quarters,” the company said. Advertising spending totaled about $5 million in the second quarter, and is likely to fall to less than $3 million a quarter for the rest of the year, Kforce said.

“While we made progress this quarter toward streamlining our operations and returning the company to profitability, there is still much to be achieved,” said President and Chief Executive Officer David Dunkel. “The market for information technology flexible staffing remains quite challenging, but other areas of our business are continuing to exhibit growth and we remain highly committed to executing our business model.”

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