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Sep 30, 2020
Kforce Q3 2020 Earnings Report
Reported revenue of $365.4 million, up 5.7% year over year. EPS of $0.89, an increase of 30.9% year over year.
Key Takeaways
Kforce reported a strong third quarter with revenue reaching $365.4 million, a 5.7% increase year-over-year. EPS increased by 30.9% to $0.89. The company experienced sequential growth in all lines of business, with notable growth in the technology segment.
Revenue for the quarter ended September 30, 2020, was $365.4 million, up 6.5% sequentially and 5.7% year-over-year.
Tech Flex revenues increased 1.7% sequentially but declined 4.2% year-over-year.
FA Flex revenue increased 19.1% sequentially and 51.6% year-over-year, including $51.1 million related to COVID-19 business.
Operating margin for the quarter ended September 30, 2020, was 7.3%, an increase of 280 basis points sequentially and 90 basis points year-over-year.
Forward Guidance
Kforce provided revenue guidance of $337 million to $347 million and EPS guidance of $0.70 to $0.78 for Q4 2020.
Positive Outlook
- Revenue of $337 million to $347 million
- Earnings per share of $0.70 to $0.78
- Gross profit margin of 28.1% to 28.3%
- Flex gross profit margin of 26.5% to 26.7%
- Effective tax rate of 23.5%
Challenges Ahead
- 62 billing days, which is the same as the fourth quarter of 2019 and two fewer than the third quarter of 2020.
- SG&A expense as a percent of revenue of 21.4% to 21.6%
- Operating margin of 6.2% to 6.6%
- WASO of 21.2 million
- Possibly shorter-term in nature and likely non-recurring in nature (COVID-19 contracts).
Historical Earnings Impact
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Avg. Return Before/After Earnings
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