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StarTek, Inc. Reports Second Quarter 2012 Results

Stocks in this article: SRT

StarTek, Inc. (NYSE:SRT) today announced its financial results for the second quarter ended June 30, 2012. The Company reported second quarter 2012 revenue of $44.4 million and a net loss of $4.3 million or $0.28 per share. As of June 30, 2012, the Company had approximately $11.4 million in cash and no debt.

Second Quarter 2012 Financial Results

Second quarter 2012 revenue decreased 13% compared to the first quarter of 2012. The majority of this decrease was in the domestic segment, which experienced a reduction of $5.7 million due primarily to the ramp-down of business in our Decatur and Jonesboro locations. Volume softness experienced with other clients contributed to further declines versus first quarter across all segments.

Gross margin decreased from 10.5% in the first quarter of 2012 to 7.4% in the second quarter of 2012. Gross margin in Asia Pacific decreased from 25% to 17% due primarily to the ramp up of new business. Domestic gross margin fell slightly from 3% to 2% due to the ramp-down of business discussed above. Gross profit in Latin America remained flat quarter over quarter.

SG&A expense for the quarter totaled $7.3 million, compared to $8.3 million in the first quarter. The decrease was driven primarily by lower support staff costs and other corporate cost reductions.

The Company reported second quarter 2012 adjusted EBITDA loss of $0.4 million and an operating loss before impairment and restructuring charges of $4.1 million, compared to a first quarter adjusted EBITDA of $1.2 million and an operating loss before impairment and restructuring charges of $3 million. The Company had a net loss of $4.3 million, or $0.28 per share, during the second quarter of 2012. The second quarter 2012 net loss compares to a net loss of $6.1 million, or $0.40 per share, in the first quarter of 2012.

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