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WALNUT CREEK, CA, Tuesday, January 24, 2006 --
Westaff, Inc. (NASDAQ: WSTF), a leading provider of staffing services, today announced that it has entered into an agreement to acquire its Houston, Texas franchise operation, comprising two offices located in the Galleria and Greenspoint areas, effective January 22, 2006.
Westaff franchise owner, Peggy Fruhwirth, along with her husband, Tracy Snyder, opened their first Westaff franchise office in the Galleria area of Houston in 1997. The second office was opened in North Houston in mid-1998. During their nine years with Westaff they have grown their operations to become the 21 st largest staffing firm in the greater Houston market as recently reported by the Houston Business Journal 2006 Book of Lists. Peggy began her career in the staffing industry in California in 1986 and relocated to Houston in 1989, running branch and sales operations along with leading training and business development programs. She joined Westaff as a franchise in 1997 in order to partner with a firmly established and reputable staffing company.
Both Peggy Fruhwirth and Tracy Snyder have agreed to stay on as Westaff Vice Presidents to continue to build the Houston market and to potentially expand their role in support of Westaff's future growth and development. In their new leadership roles, Peggy and Tracy will be working with Stephen J. Russo, Westaff Senior Vice President, Field Operations, to evaluate opportunities to expand Westaff's presence in and around the Houston metropolitan markets. According to Staffing Industry Analysts, Inc., the Houston staffing market is the 6 th largest market for temporary employment in the United States.
Westaff President and CEO Trish Newman commented, "Peggy and Tracy have established an exceptional administrative, professional and permanent placement staffing presence in the Houston area through their two operating offices and I am delighted to welcome Peggy, Tracy and the entire Houston team to our network of company-owned offices."
Peggy Fruhwirth commented, "My partnership with Westaff as an affiliate owner provided me with the foundation to operate my offices with entrepreneurial spirit backed by the right mix of support, opportunity and operating flexibility provided by Westaff. This allowed me to achieve my goals of establishing a reputable and profitable operation in the Houston market. My staff and I are excited to be able to continue our solid relationship with Westaff and we look forward to the opportunities for the future."
Steve Russo added, "The Houston offices have specifically developed mid-market, higher margin administrative, accounting and professional services. This acquisition fits well with Westaff's long-term goals of expanding our presence in these key service lines."
While the specific financial terms of the agreement are not being disclosed, for financial reporting purposes this acquisition will not have an impact on reported sales or gross profits for Westaff as franchise agent sales and gross profits are already included in the Company's financial results. However, operating profits generated by the acquired offices will now be included within Westaff's consolidated operating results. Management currently estimates that the acquisition will be accretive to consolidated earnings.
This press release contains forward-looking statements as defined in the Securities Exchange Act of 1934, and is subject to the safe harbors created by law. Forward-looking statements contained herein include, but are not limited to, statements regarding the Company's future growth, profitability, expansion in key markets, and the significance of any change in managerial personnel to the Company's ability to achieve any of these goals.
Forward-looking statements are based on the beliefs and assumptions of the Company's management and on currently available information. The Company undertakes no responsibility to publicly update or revise any forward-looking statement. Additional information concerning the risks and uncertainties listed above, and other factors you may wish to consider, is contained in the Company's filings with the Securities and Exchange Commission, including the Company's most recent Form 10-K, Form 10-Q, Form 8-K and other filings
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