Major Healthcare Staffing Companies Take Major Hit to Revenue

It’s not news to talk about how much the economy has negatively impacted the healthcare staffing industry this year. No company in the space has been immune. However, reading the Q3 financial reports of some of the major, public healthcare staffing companies is just downright depressing.

After be delisted from the New York stock exchange late last year, Medical Staffing Network has continued to take a pounding. Medical Staffing Network Holdings Inc. (OTCBB: MNSW.PK), a Boca
Raton FL-based healthcare staffing firm, reported third-quarter revenue
fell 41.9% to $78.9 million from $135.8 million in the same period last
year.

“The healthcare staffing industry is still experiencing a difficult
economic environment, although we are beginning to see some very
early-stage positive trends,” said Chairman and CEO Robert Adamson. “We
have experienced an increase in demand in October, up from September
levels, seemingly due to the flu pandemic.”

Medical Staffing Network posted a net loss of $15.2 million compared
with net income of $2.5 million in the third quarter of 2008. The
company reported a $14.0 million charge for goodwill impairment in the
most-recent quarter as well as a $700,000 charge for impairment of
intangible assets.

Medical Staffing Network Holdings Inc. (OTCBB: MSNW.PK)
For the third quarter ended Sept. 27, 2009, compared with the same period in 2008.
Revenue: $78.9 million, -41.9%
Net loss: $15.2 million vs. net income of $2.5 million

The largest company in the industry – AMN Healthcare Services Inc. (NYSE: AHS), reported third-quarter revenue fell 47.2% to
$166.4 million from $315.0 million in the year-ago quarter.

Nurse and allied healthcare staffing revenue fell 62.2% on a
year-over-year basis in the third quarter to $82.1 million. Physician
permanent placement revenue fell 30.6% in the third-quarter to $8.7
million. And third-quarter locum tenens revenue fell 11.5% to $75.5
million.

“The unprecedented market contraction experienced by the healthcare
staffing industry over the past year is a direct reflection of the
rapid rise to historically high levels of general unemployment,”
President and CEO Susan Nowakowski said. “The decline in volumes we
experienced during the first nine months of 2009 have certainly
highlighted the importance of our ability to remain agile and
disciplined in our execution.”

AMN posted a third-quarter net loss of $2.0 million compared to net
income of $9.5 million in the same period last year. The most-recent
quarter included a restructuring charge of $6.2 million. Fourth-quarter revenue is estimated to decline 10% to 15% compared with the third quarter, according to the company.

AMN Healthcare Services Inc. (NYSE: AHS)
For the third quarter ended Sept. 30, 2009, compared with the same period in 2008.
Revenue: $166.4 million, -47.2%
Net loss: $2.0 million vs. net income of $9.5 million

Cross Country, who only a few short years ago held the #1 spot in the industry, also took a dramatic loss. Third-quarter revenue for Cross Country Healthcare Inc.
(NASD: CCRN) fell 27.2%
to $129.6 million from $178.1 million in the third quarter
of 2008.

Third-quarter nurse and allied staffing revenue at the Boca Raton
FL-based healthcare staffing firm fell 50.3% to $64.1 million from
$128.9 million in the year-ago quarter. Clinical trials third-quarter
revenue fell 35.4% to $16.4 million.

Travel nurse staffing volume rose 6% since mid-September, President
and CEO Joseph Boshart said. “This improvement in staffing volume has
resulted from a significant increase in demand since the spring, with
current open order levels for travel nurses six times the levels seen
prior to the summer.”

Third-quarter net income fell 84.3% to $968,000 from $6.2 million in the year-ago quarter.

Cross Country estimated fourth-quarter revenue of $120 million to
$123 million, a year-over-year decline of approximately 40% to 42%.

Cross Country Healthcare Inc. (NASD: CCRN)
For the third quarter ended Sept. 30, 2009, compared with the same period in 2008.
Revenue: $129.6 million, -27.2%
Net income: $968,000, -84.3%

Although I want to be optimistic and there are several signs out there suggesting stabilization, it’s discouraging to still be seeing such dismal numbers from the top players.



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2 thoughts on “Major Healthcare Staffing Companies Take Major Hit to Revenue

  1. This past year will give the small company’s a advantage as the large companies continue to trim the fat both with nurse salaries & with internal staff. Hospitals & nurses will suffer over the next 24 months to make up for lost revenue.
    “The competitor to be feared is one who never bothers about you at all, but goes on making his own business better all the time” Henry Ford
    Brad Garrett, COO & Founder
    TGhealthcare.com

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