Ablest: Reports First Quarter Earnings New Headquarters also Opening This Week CLEARWATER, Fla., May 9 Ablest Inc. (Amex: ABI - news), a commercial staffing and information technology (IT) solutions provider, today reported first quarter 2000 earnings of $.10 per share. Ablest revenues increased $4.2 million, or 19.4 percent, to $25.9 million in the first quarter of 2000 from $21.7 million during the same period the year prior. The Corporation reported net earnings from continuing operations of $75,000, or $.03 per share, in the first quarter of 2000 compared to a net loss of $9,000, or less than $0.1 per share, during the first three months of 1999. The Company reported first quarter 2000 net earnings of $275,000, or $.10 per share, including a gain of $200,000, or $.07 per share, from discontinued operations. ``The Company's exclusive focus on its staffing operations is already beginning to pay off for Ablest and its shareholders,'' Chairman Charles H. Heist said. ``While first quarter earnings were modest, they are a significant improvement over historic first quarter performance. The Company now has the resources and financial structure to implement plans for maintaining sustainable top- and bottom-line results for Ablest Inc.'' For example, Heist said the four new Ablest branches opened this year are expected to be accretive to earnings by the end of 2000. ``By executing Ablest's strategic plan, our Vision, for winning and retaining the business of outstanding customers, our associates are building an even stronger business,'' Heist added. ``In particular, our commercial staffing branches continued to perform exceptionally through the first three months of the year.'' Revenues from Ablest's commercial staffing operations increased $6.1 million, or 39.1 percent, to $21.7 million in the first quarter of 2000 from $15.6 million during the same period the year prior. The 39.1 percent commercial sales growth is attributed to the performance of seven Ablest commercial staffing branches opened during 1999, greater market penetration from existing offices, and the use of a 14-week quarter versus 13 weeks in the first quarter of '99. Revenues from Ablest's IT operations were $4.2 million in the first quarter of 2000, compared to $6.1 million during the same period the year prior. IT gross margins improved to $25.9 percent of sales in the first quarter of 2000 compared to 23.0 percent in the first three months of 1999. As part of the residual affect of the Y2K phenomenon, which has temporarily dampened industry-wide demand, Ablest will increasingly pursue IT revenue growth by filling customers' need for e-commerce, Internet and Web technology consultants. ``In response to demand for e-commerce professionals, we began dramatically shifting our training, recruitment and retention programs early in 2000,'' Heist explained. ``In every successive quarter for the foreseeable future, we expect these new-economy services to comprise a rapidly growing share of Ablest IT revenue. ``To lead Ablest's IT business in the new, e-commerce driven economy, we are actively searching for a new senior executive for this division,'' Heist said, noting that Ablest IT branches will report directly to President Kurt R. Moore in the interim. The Company's gross margin remained a healthy 22.7 percent of revenue in the first quarter of both '99 and 2000. Sales, general and administrative expenses remained at about 22 percent of staffing services revenue for the first quarters of both 2000 and 1999. Flat SG&A was achieved in spite of the first quarter costs for consolidating three facilities into the new headquarters, expanding corporate resources to accommodate the stand-alone Ablest Inc. and opening four new branches. This week, Ablest Inc. is moving to its new headquarters facility at 1901 Ulmerton Road, Suite 300, Clearwater, Florida 33762-2317. The relocation within the Tampa-Bay area allows Ablest to consolidate all of its corporate administration, training and support functions into a single, state-of-the-art facility. In March 2000, the Company completed its sale of the C.H. Heist industrial maintenance businesses. Onyx Industrial Services, Inc. purchased substantially all of the Company's U.S. and Canadian industrial operations, as well as the ``C.H. Heist'' name, for $19.7 million in cash and approximately $2.6 million in assumed liabilities. Proceeds from the sale were used primarily to pay down long-term debt and provide working capital for continuing operations. Ablest's quick ratio was 2.3 to 1 on April 2, 2000 compared with 1.6 to 1 on December 26, 1999. At the end of first quarter 2000, the current ratio was 2.8 to 1 compared to year-end 1999's 1.8 to 1. Net working capital also improved by $3.1 million during the first three months of 2000. Ablest Inc. provides its clients with commercial staffing and information technology (IT) solutions, managed services and vendor-on-premise (VOP) programs. Commercial staffing solutions -- including accounting, clerical, administrative and light-industrial personnel -- are provided through Ablest Staffing Services. IT staffing solutions - including computer programming and networking consultants -- are provided through Ablest Technology Services. Through 52 branches in the Eastern and Southwestern United States, Ablest supplies more than 30,000 field employees and consultants to more than 3,500 businesses annually. Statements made in this news release, other than those concerning historical information, should be considered forward-looking and subject to certain risks and uncertainties which could cause actual results to differ materially from those projected. Readers should carefully review and consider disclosures, including periodic reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission, which attempt to advise interested parties of the factors, which affect the Company's business. ABLEST INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (unaudited - in thousands except share and per share amounts) OPERATING RESULTS: Fourteen Week Thirteen Week Period Ended Period Ended April 2, 2000 March 28, 1999 Net Service Revenue $25,893 $21,682 Cost of Services 20,021 16,769 Gross Margin 5,872 4,913 Sales, General & Administrative Expenses 5,663 4,602 Amortization of Intangible Assets 92 181 Operating Income 117 130 Other income (expense): Interest Expense, Net (106) (143) Miscellaneous, Net 128 (3) Total Other Income (Expense), Net 22 (146) Income (Loss) Before Income Taxes from Continuing Operations 139 (16) Income Tax Expense (Benefit) 64 (7) Net Earnings (Loss) from Continuing Operations 75 (9) Discontinued Operations Loss from Discontinued Operations, Net of Income Taxes -- (85) Gain (Loss) on Sale of Discontinued Operations, Net of Income Taxes 200 -- 200 (85) Net Earnings (Loss) 275 (94) Basic and Diluted Net Earnings (Loss) Per Share Continuing Operations .03 -- Loss From Discontinued Operations -- (.03) Gain on Sale of Discontinued Operations .07 -- Basic Earnings (Loss) Per Share $0.10 $(.03) Average Shares Outstanding 2,882,685 2,880,271 ABLEST INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (unaudited - in thousands except share and per share amounts) April 2, December 26, 2000 1999 Assets: Current Assets: Cash and Cash Equivalents $1,255 $562 Receivables 11,492 13,492 Prepaid Expenses and Other 792 419 Deferred Income Taxes 1,957 1,100 Total Current Assets 15,496 15,573 Net Property, Plant and Equipment 1,880 2,213 Deferred Income Taxes 1,047 909 Intangible Assets, Net 4,789 4,880 Net Assets of Discontinued Operations 1,713 20,434 $24,925 $44,009 Liabilities and Stockholders' Equity: Current Liabilities: Accounts Payable $725 $1,468 Accrued Expenses 4,782 7,223 Total Current Liabilities 5,507 8,691 Long-Term Debt, Excluding Current Installments -- 15,950 Other Liabilities 453 756 Total Liabilities 5,960 25,397 Stockholders' Equity: Common stock of $.05 par value. Authorized 8,000,000 shares; issued 3,178,092 and 3,167,092 shares for 2000 and 1999, respectively 159 158 Additional Paid-In Capital 4,362 4,285 Retained Earnings 15,666 15,391 20,187 29,377 Less Cost of Common Stock in Treasury: 285,529 shares for 2000 and 1999, respectively (1,222) (1,222) Total Stockholders' Equity 18,965 18,612 $24,925 $44,009 For more information call: Charles H. Heist Chairman of the Board 727-299-1200 1901 Ulmerton Road, Suite 300 Clearwater, Florida 33762-2317 E-mail: trip_heist@ablest.com End