StarTek, Inc. Reports Second Quarter Results.

Publication: Business Wire

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COPYRIGHT 2007 Business Wire

Continued Improvement Toward Growth and Profitability Plan

DENVER -- StarTek, Inc. (NYSE:SRT) today announced results for the second quarter of 2007. Revenue for the second quarter was $58.8 million, an increase of 2.1% from the first quarter of 2007, with a net loss of $3.4 million, or $0.23 per diluted share. The results were negatively affected by a decline in foreign currency exchange rates. In addition, the Company booked one-time non-cash charges for the impairment of assets and a tax valuation allowance. Cash and investments increased $8.3 million for the quarter to $43.7 million, due mainly to working capital improvements.

Financial Results

Revenue for the second quarter of 2007 increased $1.2 million or 2.1% over the first quarter of 2007 to $58.8 million. Most of the growth was attributable to increased business from current clients and improved pricing terms with two significant clients. Compared to the second quarter of 2006, revenue was down $0.7 million or 1.2%. This was driven by the temporary closing of the Petersburg facility and lower FTE due to continued staffing pressures, partially offset by new business, improved pricing, and productivity.

Gross margin for the second quarter of 2007 was 14.5% compared...

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