Tuesday, December 29, 2009

Afterhours. KForce +10% as the government says they're back in business (KFRC)

Share of staffing firm KForce (KFRC) are trading up 10% after hours, as the Federal Government has removed their "suspended" status and will let them bid for government work again.

Among the Department of the Interior's findings:

As a result of the Agreement, KGS is no longer proposed for debarment, and is now authorized to enter into new and renewed Federal business, effective immediately.
The Agreement requires, among other things, that KGS return to the DOI the profit on a $78,892.32 Task Order issued in 2008, and requires KGS to enhance its existing compliance program, training and controls.
This is certainly good news for KForce, as government services (GS) represents about 8% of total company revenues, and this segment's gross margins are well above the company average:


The original problem was that KForce essentially helped write the work order for a project up for bidding by the Bureau of Land Management - and they happened (shocker) to be the winner of the bid for this contract! So they're handing the $$ back and things are all better.
"The Notice relates to a $78,892.32 fixed price task order issued to KGS in 2008 by the Bureau of Land Management ("BLM"). The DOI's concerns relate to KGS's involvement in assisting the BLM to prepare the requirements for a Statement of Work for the project that KGS was later awarded."

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