EXHIBIT 99.1

 

 

LABOR READY NET INCOME INCREASED 22% IN 3rd QUARTER 2003
Company Estimates 40% Increase in 2003 Annual Net Income

 

TACOMA, WA – October 14, 2003 — Labor Ready, Inc. (NYSE:LRW) reported today that revenue for the third quarter ended September 26, 2003 rose 1.4% to $254.5 million compared to revenue of $250.9 million a year earlier.  Net income increased 22% to $10.3 million or $0.22 per share, compared to net income of $8.5 million or $0.18 per share in the third quarter of 2002.

 

“We are pleased with the strong earnings results in the third quarter,” said Labor Ready President and CEO Joe Sambataro.  “We are also encouraged by the sales momentum we saw at the end of September and the first weeks of October.  We intend to continue to deliver solid earnings growth by holding gross margins and operating expenses steady while aggressively pursuing sales.”

 

According to Sambataro, the 22% increase in net income was a result of a combination of higher gross margins of 30.1%, as compared to 29.1% a year ago, and a continuation of expense management initiatives.

 

For the fourth quarter, the Company estimates net income will increase approximately 20% over the $3.3 million of net income realized in the fourth quarter of 2002.  Revenue for the fourth quarter is expected to be in the range of $228 to $233 million compared to $223 million a year earlier.

 

The Company estimates net income for 2003 will increase approximately 40% over 2002 net income of $11.6 million, while revenue for the year is expected to be in the range of $870 to $875 million compared to revenue of $863 million in 2002.

 

Management will discuss third quarter 2003 results today on a conference call at 2:00 p.m. (PT). The conference call may be accessed on Labor Ready’s web site at www.LaborReady.com and will be available for replay for 30 days following the call.

 

About Labor Ready

Labor Ready is the nation’s leading provider of temporary manual labor to the light industrial and small business markets.  Labor Ready serves more than 275,000 customers by providing a flexible, dependable workforce to such industries as freight handling, warehousing, landscaping, construction and light manufacturing.  In 2002, the Company put nearly 600,000 people to work.  Labor Ready currently operates more than 780 locations in the U.S., Canada, and the United Kingdom. For additional information, visit Labor Ready’s website at www.LaborReady.com.

 

 

This news release contains forward-looking statements, such as statements about the ranges of revenues and profits anticipated for future periods, sales momentum, the success of measures for controlling costs and maintaining gross margins, and other factors that may affect our financial results and operations in the future. Our actual results are, however, subject to a number of risks, including:  1) national and global economic conditions; 2) our ability to continue to attract and retain customers and maintain profit margins in the face of new and existing competition; 3) potential new laws and regulations that could have a materially adverse effect on our operations and financial results; 4) adverse developments in pending or future litigation; 5) significant labor disturbances which could disrupt industries we serve; 6) increased costs and collateral requirements in connection with our insurance obligations, including workers’ compensation insurance; 7) the adequacy of our financial reserves; 8) our continuing ability to comply with financial covenants in our lines of credit and other financing agreements; 9) our ability to attract and retain competent employees in key positions; and 10) other risks described in our filings with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q filed August 5, 2003.

 

 

For more information, contact:

 

Steve Cooper, CFO

253-680-8213

 

Stacey Burke, Director of Public Relations

253-680-8291

 

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LABOR READY, INC.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)

 

		Thirteen Weeks Ended						Thirty-nine Weeks Ended
		September 26, 2003			September 27, 2002			September 26, 2003			September 27, 2002
		(unaudited)						(unaudited)
Revenue from services		$	254,497		$	250,899		$	642,461		$	640,107
Cost of services		177,943			177,829			450,036			455,316
Gross profit		76,554			73,070			192,425			184,791
Selling, general and administrative expenses		57,261			56,144			163,848			162,773
Depreciation and amortization		2,137			2,183			6,252			6,974
Income from operations		17,156			14,743			22,325			15,044
Interest and other expense, net		(1,202		)	(1,101		)	(3,284		)	(1,642		)
Income before provision for income taxes		15,954			13,642			19,041			13,402
Taxes on income		5,605			5,161			6,686			5,067
Net income		$	10,349		$	8,481		$	12,355		$	8,335
Basic net income per share		$	0.26		$	0.21		$	0.31		$	0.20
Diluted net income per share		$	0.22		$	0.18		$	0.29		$	0.20
Weighted average shares outstanding:
Basic		40,335			41,228			40,263			41,027
Diluted		51,035			51,474			50,610			41,773

 

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LABOR READY, INC.
SUMMARY CONSOLIDATED BALANCE SHEETS

 

		As of
		September 26, 2003			December 31, 2002
Assets
Current assets
Cash, cash equivalents, and marketable securities		$	89,547		$	90,577
Accounts receivable, net		100,937			66,987
Other current assets		15,925			19,726
Total current assets		206,409			177,290
Property and equipment, net		29,791			31,217
Other assets		114,253			108,693
Total assets		$	350,453		$	317,200
Liabilities and shareholders’ equity
Current liabilities		$	71,736		$	57,836
Long-term liabilities		134,656			127,253
Total liabilities		206,392			185,089
Shareholders’ equity		144,061			132,111
Total liabilities and shareholders’ equity		$	350,453		$	317,200

 

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