StarTek, Inc. (NYSE:SRT) ("STARTEK") today announced its third quarter 2013 financial results.
Third Quarter Highlights
- Won $43.6 million of new business, including one new logo; $61.6 million year to date;
- Launched STARTEK Health Services, including the acquisition of a health care BPO company;
- Invested in 1,500 seats of new capacity that will be ramping over the next two quarters; and
- Implemented key element of IT platform initiative.
Third Quarter 2013 Financial Results
Third quarter 2013 revenue increased 22.6% compared to the third quarter of 2012, the result of continued growth with existing clients and new business. All segments showed year over year revenue growth.Gross margin decreased from 12.8% in the third quarter of 2012 to 11.2% in the third quarter of 2013. This decline was primarily due to investments in facility expansions in the Philippines and IT transformation related costs. Latin America margins improved to 11.2% in the third quarter of 2013 from (0.7)% in the third quarter of 2012 as a result of capacity utilization improvements. SG&A expenses as a percentage of revenue was 12.2% for the third quarter of 2013 compared to 14.5% for the third quarter of 2012. Excluding non-recurring IT transformation expenses and a depreciation charge for the reclassification of the Company's Enid, Oklahoma facility, the Company generated net income of $0.1 million. Including the above charges, the Company reported a net loss of $1.8 million, or $0.12 per share, during the third quarter of 2013 as compared to a net loss of $1.2 million, or $0.08 per share, in the third quarter of 2012. Liquidity and Capital Resources As of September 30, 2013, the Company's cash position was approximately $6.0 million compared to $9.2 million as of December 31, 2012. The Company had approximately $2.6 million and $3.1 million of capital expenditures during the quarters ended September 30, 2013 and 2012, respectively. The acquisition of a health care BPO resulted in the use of $0.4 million of cash during the third quarter of 2013.