GEE Group Reports Fiscal 2024 Q2 and YTD Financial Results Amid Economic Challenges

GEE Group Inc. (NYSE American:JOB) announced a decline in fiscal 2024 second quarter and year-to-date financial results on May 15, 2024, highlighting significant revenue drops and operational struggles due largely to adverse macroeconomic conditions. For the quarter ended March 31, 2024, the company, a provider of professional staffing services, reported a consolidated revenue of $28.0 million, marking a 28% decrease from the previous year. Year-to-date revenue stood at $58.7 million, down 27% compared to the same period in fiscal 2023.

The reduction in revenue was attributed to delayed projects and a decline in demand for contingent labor and permanent hiring, influenced by persistent inflation, interest rate volatility, and tech sector layoffs. Professional contract services and industrial contract services both saw declines, with revenues falling by $7.6 million and $0.7 million, respectively, during the quarter. Direct hire placement services also dropped significantly, from $4.9 million to $2.4 million for the quarter.

Gross profits followed the revenue downturn, with figures for the quarter reported at $8.7 million, and the gross margin slightly reduced to 31.3%. These figures reflect challenges, including higher employment costs due to inflation. Despite these difficulties, GEE Group reported taking measures such as increasing bill rates to combat margin compression. Selling, general, and administrative expenses for the quarter were $10.0 million, down 15% from the prior year, yet represented a higher percentage of revenues due to fixed expenses amidst falling revenue.

Net loss for the quarter was reported at $(1.0) million or $(0.01) per diluted share, a shift from a net income of $0.7 million a year earlier. Adjusted EBITDA was also negative at $(0.6) million, compared with $1.7 million in the previous fiscal year. The company's management acknowledged the tough macroeconomic environment but remained hopeful of a rebound in market conditions moving forward.