Staffing Industry Case Studies:
National Staffing Company Turnaround: 138% Increase in Shareholder Value

Situation

• $ 500m Remedy Temp went from a 5.5% EBITDA profit to a loss of 3.5 % of Sales
• Greg Palmer became President and CEO
• Recession hit
• Pricing pressure increased
• 2001 to 2003- Workers Compensation costs increased over $20m

Solution

• Converted existing divisions into business units focusing on the Middle Market and Niche areas
• Organically started RemX, a new specialty divisiontargeting faster growing areas with higher margins
• Reduced corporate non revenue generating overhead
• Increased pricing — Mark Up percent increased over 800 BP’s
• Exited $100m of unprofitable business
• Added $50m in cash to the balance sheet

Results

• The company went from a pretax loss of -$18.5m in 2003 to an estimated pretax profit of +$14m in 2006
• Changed the economic model to improve gross margin from 15.9% in 2003 to 22% in 2006
• Reduced non-selling general and administrative costs by 25%
• Organically grew niche specialty division to over $100M in revenue, 35% gross profit and estimated operating margins of 8 to 10 %
• Added $20m in Direct Hire revenues
• Reduced workers compensation costs by 30%, or $8m, in 3 years
• Created an additional 138%, or $100m, in shareholder value during tenure

• National Staffing Company Turnaround
• Regional Staffing Firm Adds Professional Niche
• Midwestern Light Industrial Achieves 10% EBITDA