This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

StarTek, Inc. Reports Third Quarter 2011 Results

Financial Summary

Third quarter 2011 revenue of $52.0 million represented a decrease of 9.0% compared to $57.1 million in the second quarter of 2011, and a decrease of 20.7% compared to $65.6 million in the third quarter of 2010. The decline was driven by the North American site closure and downsizings mentioned above, which accounted for $6.7 million of the decline compared to the second quarter of 2011. Revenue also declined due to the transition to a greater mix of offshore revenue which generates lower revenue but higher gross margins. These declines to revenue were partially offset by offshore revenue growth of $2.8 million.

Gross margin declined to 7.8% in the third quarter of 2011 compared to 11.0% in the second quarter of 2011 and 10.1% in the third quarter of 2010. The decrease was driven by lower U.S. and Canadian margins, which fell to 6.5% and 3.8%, respectively, due to site closures, as well as lower volumes and lower profitability in the sites that remain open. Offshore gross margin increased to 12.2% from 7.3% last quarter. Compared to last quarter, offshore gross profit dollars increased by $1.1 million on a $2.8 million revenue increase, representing incremental gross margin contribution of 36.6%.

SG&A expense for the quarter totaled $10.0 million, compared to $13.2 million in the second quarter of 2011 and $10.3 million in the third quarter of 2010. The decrease compared to the second quarter of 2011 was primarily due to the absence of $2.9 million in severance expense that impacted the second quarter.

The Company reported third quarter 2011 negative adjusted EBITDA (adjusted for severance expense, impairment and restructuring charges and stock compensation expense) of $1.5 million compared to adjusted EBITDA of $0.5 million in the second quarter of 2011. The Company reported a net loss of $6.2 million, or $0.41 per share, during the third quarter of 2011, compared to $9.7 million, or $0.64 per share, during the second quarter of 2011.

2 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.74 0.00%
FB $117.58 0.00%
GOOG $693.01 0.00%
TSLA $240.76 0.00%
YHOO $36.60 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs