Mastech Holdings, Inc. (NYSE Amex: MHH), a national provider of Information Technology and Specialized Healthcare staffing services, announced today its financial results for the third quarter ended September 30, 2010.
Revenues for the quarter were $18.9 million, or a 9.4% increase over the $17.2 million reported in the corresponding quarter last year. Gross margins in the 2010 quarter totaled 19.3% compared to 18.4% for the 2009 quarter. Operating expenses increased to $3.3 million during the quarter, from $2.5 million a year earlier. Consolidated net income for the third quarter 2010 totaled $187,000 or $0.05 per diluted share, compared to $427,000, or $0.11 per diluted share, in the same period last year.
Demand for our IT staffing services improved during the third quarter and we increased our billable consultant-base for the third consecutive quarter. We continued to invest in our sales and recruitment organizations during the quarter to help drive future growth. Market conditions in healthcare remain challenging; however, activity levels are showing some signs of stabilization and we were able to achieve sequential revenue growth during the quarter.
Thomas Moran, Chief Executive Officer of Mastech stated, "During the quarter, we achieved sequential organic revenue growth of 11.5% and increased our IT billable consultant-base by over 16%. Additionally, we continue to grow earnings per share, while at the same time making investments in our sales and recruitment organizations aimed at accelerating future growth. This approach of systematic investment to expand and enhance our business model has enabled us to achieve a 25% increase in our IT billable consultant-base during the first nine months of 2010."
Commenting on the Company's financial position, Jack Cronin, Chief Financial Officer, stated, "At September 30, 2010, we had $5.9 million of cash on hand, no outstanding bank debt and access to $7.5 million of credit under our existing revolving credit facility. As we organically expand our business, much of our free cash flow is required to support increasing working capital levels. Thus, while our cash balances have declined somewhat over the past two quarters, our credit capacity continues to increase, along with our accounts receivable balances."
In conjunction with its third quarter earnings release, Mastech will host a conference call at 9:00 A.M. EDT on October 27, 2010 to discuss these results and to answer questions. A live webcast of this conference call will be available on the company's website, www.mastech.com. Simply click on the Investor Relations section and follow the links to the live webcast. The webcast will remain available for replay through November 3, 2010.
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