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Mastech Holdings Continues Organic Growth

Mastech Holdings Continues Organic Growth

Mastech Holdings, Inc. Reports Fourth Quarter and Full Year 2012 Results

Fourth Quarter Results:

Revenues for the fourth quarter of 2012 totaled $26.4 million, which represented a 11% increase over the corresponding quarter last year and a 3% improvement over third quarter 2012 results. Gross profit in the fourth quarter of 2012 was $5.0 million compared to $4.6 million in the fourth quarter of 2011. Consolidated net income for the fourth quarter 2012 totaled $728,000 or $0.22 per diluted share, compared to $253,000 or $0.07 per diluted share, during the same period last year. Results in the 2011 fourth quarter included severance charges equal to $0.05 per diluted share.

Demand for our IT staffing services remained solid during the fourth quarter when considering the normal year-end industry trends. Market conditions in the healthcare staffing business remained largely positive and we were able to achieve sequential revenue growth for the tenth consecutive quarter. Overall gross margins in the fourth quarter of 2012 were 19.0%, which were in-line with the previous quarter's performance and slightly below the 19.3% gross margins reported a year earlier.

Full Year Results:

Revenues for the full year 2012 totaled $101.8 million, or 14% higher than 2011 revenues of $89.4 million. Gross profit for 2012 was $19.2 million, which was $1.7 million higher than the gross profit achieved in 2011. Consolidated net income for 2012 totaled $2.1 million or $0.64 per diluted share, compared to $1.1 million or $0.30 per diluted share one-year earlier.

Kevin Horner, Mastech's Chief Executive Officer stated, "We are pleased with the results that the Mastech team delivered during the quarter and for the full year 2012. For the year, we organically grew our revenues and consultant-base by approximately 14%, more than doubled our profitability in terms of diluted earnings per share, and continued to invest in our organization to better position Mastech to drive superior results in 2013 and beyond. Additionally, I believe that we were strategic in initiating several corporate transactions during 2012 which resulted in material increases in shareholder value."

Commenting on the Company's financial position, Jack Cronin, Chief Financial Officer, stated, "Our balance sheet remains strong despite returning over $9.0 million to our shareholders in 2012, by executing on our share repurchase program and declaring a special $2.00 per share cash dividend. We enter 2013 well positioned with the capital resources necessary to support our growth objectives. At December 31, 2012, we had short-term borrowings, net of cash balances on hand, of $2.0 million and have access to approximately $12.5 million of borrowing capacity under our existing credit facility with PNC Bank."


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