NetSol Technologies, Inc. (NTWK) Announces Q2 FY 2010 Financial Results

NetSol Technologies, Inc., a U.S. corporation providing global business services and enterprise application solutions to private and public sector organizations worldwide, today reported its second quarter financial results for fiscal year 2010, for the period ended December 31, 2009.

Financial highlights for the quarter include:

• $9.5 million in revenues, up 81% year-over-year and 25% sequentially
• Substantial improvement in gross margin to 62% compared to 27% a year earlier
• Operating income of $1.7 million compared to an operating loss of $2.8 million in the same period a year ago
• GAAP net loss applicable to common shareholders of only $0.4 million compared to GAAP net loss of $3.3 million in the year ago period
• EBITDA totaled $0.9 million, or $0.03 per diluted share, versus an EBITDA loss of $1.9 million, or a loss of $0.07 per diluted share, in the same period a year ago

In the press release, NetSol reiterated its guidance for fiscal year 2010 projecting revenues in the range of $33.0 million and $35.0 million, representing full year revenue growth of between 25% and 32% when compared to fiscal year 2009. The company also anticipates a return to GAAP net income for fiscal year 2010, versus a GAAP net loss of $0.30 per diluted share for fiscal year 2009. License revenues for fiscal year 2010 are expected to increase more than 100% versus fiscal year 2009.

Najeeb Ghauri, NetSol Technologies chairman and chief executive officer, stated, “Our fiscal second quarter 2010 financial results marked our third consecutive quarter of double-digit sequential revenue growth, highlighted by an 81% increase in sales versus the year ago period. NetSol also delivered material improvements in gross margin, operating income, GAAP net income, and EBITDA results versus the year ago period. These performance gains highlight the significant improvement in NetSol’s core business as we continue to successfully convert our business pipeline to customer wins.”

He added, “Revenues from license fees resumed a pre-recession trajectory growing over 400% year-over-year as global customers began to further unlock spending and resume the purchase of large strategic software solutions, particularly in the automotive and financial sectors. Additionally, we continue to implement efficiency measures aimed at increasing our long-term profitability. Our efforts to continuously rationalize operating expenses included the relocation of our global and operating headquarters in the U.S., now under the leadership of Mr. Imran Haider, the recently appointed Chief Operating Officer of NetSol North America, Inc., to Alameda which is expected to save the company an estimated $5 million over a 5 year period.”

“As NetSol continued to invest in its core NetSol Financial Suite (NFS)(TM) throughout the global economic downturn the company is well positioned to leverage the upturn in customer activity we continue to see, particularly in China, as NetSol begins the second half of its fiscal year 2010 with continued positive momentum. We are continuing to see increased interest among major customers as well as potential partners in the sector and see excellent opportunities for collaboration and strategic initiatives as we look ahead to the second half of our fiscal year 2010,” concluded Mr. Ghauri.

Business highlights for the quarter include:

• Relocation of global and U.S. operating headquarters which will save approximately $5 million over a five year period
• Appointment of Mr. Imran Haider as the new Chief Operating Officer of NetSol North America, Inc. bringing 8 years of product and sales expertise from NetSol Asia Pacific
• Toyota Motor Finance China upgrades to a NetSol Financial Suite(TM) license
• A major Chinese automotive finance company awarded NetSol a $2 million contract
• Expanded sales and delivery capabilities in China, leveraging fast growing Chinese consumer and asset finance market
• NetSol secured a major Information Security contract in the mobile telecommunications sector
• BMW Group Financial Services awarded NetSol additional services contract
• NetSol awarded IT Services contract in Saudi Arabia, further expanding presence in the Middle East market
• United Kingdom based bank awarded NetSol a $1 million major software and IT services contract
• NetSol IT Business Services awarded Information Security contract to implement a data center security project in conjunction with a leading solution integrator in Pakistan

Ableauctions (AAC) Acquires Coal and Coke Producer SinoCoking

Feb. 4, 2010 (Business Wire) — Ableauctions.com Inc. (AMEX:AAC) (the “Company”) released a statement today about its acquisition of SinoCoking, a coal and coke producer based in central China.

“We are pleased to announce our acquisition of SinoCoking, a coal and coke producer based in the Henan Province in the People’s Republic of China,” said Abdul Ladha, Chief Executive Officer of Ableauctions.com, Inc. The closing of the acquisition is scheduled to occur at the close of business on February 5, 2010. Mr. Ladha further added “this acquisition has provided our shareholders with a unique opportunity to participate as equity holders in what we believe to be a company that has good fundamentals and growth potential as a supplier of products of vital economic importance within China’s fast-growing economy. Moreover, the transaction allows our pre-acquisition shareholders to receive the full liquidation value of our pre-acquisition business assets in addition to a 3% aggregate stake in the reorganized company to be renamed SinoCoking Coal and Coke Chemical Industries, Inc. We are excited about the potential of SinoCoking to grow and build shareholder value.”

Mr. Ladha, who has served as Chief Executive Officer of Ableauctions since 1999, will step down as CEO on February 5, and will be succeeded by Mr. Jianhua Lv, who is an initial founder and current President of SinoCoking. In addition, on February 5, 2010, the current board of directors of Ableauctions will step down and be succeeded by seven new directors designated by SinoCoking.

Mr. Jianhua Lv, the incoming CEO of the Company stated “As a coal producer and coke manufacturer, SinoCoking has been a significant supplier of the vital commodities of thermal and metallurgical coal and coke to industrial customers such as power plants, steel mills and other industrial buyers in China since 1996. SinoCoking is a vertically-integrated processor that uses coal from both its own mines and that of third-party mines to provide basic and value-added coal products to its client base. SinoCoking currently holds mining rights for approximately 2.5 million tons of coal from mines located in central China. SinoCoking began producing metallurgical coke in 2002, and since then has expanded its production to become an important supplier to regional steel producers in central China. Coke, which is an essential ingredient in steel-making, is manufactured in SinoCoking’s on-site facilities by heating selected coal with certain thermal and chemical properties at extremely high temperatures in an oxygen-free environment. For the year ending June 30, 2009, SinoCoking produced and sold 154,631 tons of coke, 55,360 tons of washed coal, and 72,923 tons of raw coal, and generated $51 million in revenue from sales consisting primarily of these products. During its 2009 fiscal year, SinoCoking had audited net income of approximately $17 million on a GAAP basis.”

Mr. Lv went on to say “We produce essential products that power the industrial growth of China – coal and coke, and we see this moment as only the beginning of a long-term secular expansion. Currently, the demand from our customers significantly exceeds our current production capacity, and we think that demand from Chinese industrial purchasers will continue to increase. We are investing heavily in building our production capacity, and since we are a larger producer that utilizes advanced manufacturing processes with less impact on the environment, we enjoy strong support from the Henan provincial and local governments.

Although the Chinese government has recently taken steps to slow its rapid economic expansion, the Chinese economy is nonetheless expected to grow at an annual rate of approximately 9% per year for the next five years, according to government sources. Domestic steel demand is expected to grow at 10% per year over the same period. China’s demand for coke is expected to be approximately 4.5 billion tons per year in the following years, and as a nation it is now the largest producer and consumer of coking coal in the world. As a source of fuel, approximately 70% of China’s energy consumption is derived from coal, and as such it is regarded as key element of China’s energy policy and strategy. The Chinese government has also engaged in a policy of promoting consolidation within the coal mining industry, as larger operators have been determined to operate more efficiently, with consistently higher safety records and less environmental impact.”

“Coal and coke are fundamentally important products to the growth of China. We believe that SinoCoking can mine, produce, market and fulfill these products more effectively than many of our competitors. We also believe that right now, there is no better market in the world to operate and grow our business than China,” said Mr. Lv. “On behalf of SinoCoking, we are proud to complete this business combination with a U.S. publicly-traded company. Being a U.S. public company will put us in a position to attract the capital that our company needs to expand our operations, and create value for our shareholders.”

About SinoCoking

Top Favour Limited, a British Virgin Islands holding company (“Top Favour”), through its wholly owned subsidiary Pingdingshan Hongyuan Energy Science and Technology Development Co., Ltd. (“Hongyuan”), controls Henan Province Pingdingshan Hongli Coal & Coke Co., Ltd. (“Hongli”), a coal and coal-coke producer in Henan Province in the central region of the People’s Republic of China (“PRC” or “China”). Hongli produces coke, coal, coal byproducts and electricity through its branch operation, Baofeng Coking Factory, and its wholly owned subsidiaries, Baofeng Hongchang Coal Co., Ltd. and Baofeng Hongguang Environment Protection Electricity Generating Co., Ltd. (collectively referred to as “SinoCoking”).

For further information about SinoCoking, please refer to the Definitive Proxy Statement of Ableauctions.com, Inc. filed on Schedule 14A with the Securities and Exchange Commission on November 27, 2009.

For a comprehensive Corporate Update and prior releases, visit www.ableauctions.com. For more information, contact Investor Relations at investorrelations@ableauctions.com

This press release contains forward-looking statements, particularly as related to, among other things, the business plans of the Company, statements relating to goals, plans and projections regarding the Company’s financial position, the Company’s business strategy, the Company’s real estate development project, including the business of SinoCoking. The words or phrases “would be,” “will allow,” “intends to,” “may result,” “are expected to,” “will continue,” “anticipates,” “expects,” “estimate,” “project,” “indicate,” “could,” “potentially,” “should,” “believe,” “think”, “considers” or similar expressions are intended to identify “forward-looking statements.” These forward-looking statements fall within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934 and are subject to the safe harbor created by these sections. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties. Such forward-looking statements are based on current expectations, involve known and unknown risks, a reliance on third parties for information, transactions or orders that may be cancelled, and other factors that may cause our actual results, performance or achievements, or developments in our industry, to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from anticipated results include risks and uncertainties related to the global recession, the performance of our staff and management, our ability to obtain financing, competition, general economic conditions and other factors that are detailed in our Annual Report on Form 10-K and on documents we file from time-to-time with the Securities and Exchange Commission. Factors that could cause our real estate development results to differ materials from anticipated results include delay experienced during any phase of the project development (such as in obtaining permits) or unforeseen problems (such as labor disputes, increasing materials costs, or an inability to obtain adequate financing). Even if we are able to build the project, the market for the units we build could decline. We cannot guarantee you that our building projects will be successful or that we will be able to recover the money we put into them. If our building projects are unsuccessful, our business and our cash flow will be materially adversely affected. Price changes may occur in the market as a whole, or they may occur in only a particular company, industry, or sector of the market. Real estate values and mortgage loans can be seriously affected by factors such as interest rate fluctuations, bank liquidity, the availability of financing, and by factors such as a zoning change or an increase in property taxes. Since the majority of our investments are held in Canadian funds, currency fluctuations may affect the value of our portfolio significantly. There can be no assurance that the securities and other assets in which we have invested will increase, or even maintain, their value. Statements made herein are as of the date of this press release and should not be relied upon as of any subsequent date. The Company cautions readers not to place undue reliance on such statements. The Company does not undertake, and the Company specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement. Actual results may differ materially from the Company’s expectations and estimates.

China Agritech, Inc. (CAGC) Announces 2 for 1 Forward Stock Split Effective February 1, 2010

Feb. 5, 2010 (PR Newswire) — China Agritech, Inc. Announces 2 for 1 Forward Stock Split Effective February 1, 2010

BEIJING — China Agritech, Inc. (Nasdaq: CAGC) (“China Agritech” or “the Company”), a leading national organic fertilizer manufacturer and distributor in China, today announced that it effected a 2 for 1 forward split of its common stock on February 1, 2010 which will be reflected on NASDAQ beginning with trading on Monday, February 8, 2010.

The effect of the forward split will be to increase the number of shares of common stock outstanding to approximately 17.3 million from the 8.7 million shares outstanding prior to the forward split. Each shareholder of record as of the close of trading on February 1, 2010, will have 2 common shares for every 1 common share previously held.

Mr. Yu Chang, Chief Executive Officer of China Agritech, commented, “We believe the Company’s shareholders will benefit from the greater liquidity in the Company’s common stock created by the stock split. The success of our strategic plan through the introduction of our new organic granular fertilizers combined with our organic liquid fertilizers, has generated increased financial results and shareholder interest. The greater liquidity may make the stock more attractive for certain institutions and improve our trading characteristics.”

About China Agritech, Inc.

China Agritech, Inc. is engaged in the development, manufacture and distribution of liquid and granular organic compound fertilizers and related products in China. The Company has developed proprietary formulas that provide a continuous supply of high-quality agricultural products while maintaining soil fertility. The Company sells its products to farmers located in 28 provinces of China.

For more information about the Company, please visit http://www.chinaagritechinc.com.

Safe Harbor Statement

This release may contain certain “forward-looking statements” relating to the business of China Agritech and its subsidiary companies, which can be identified by the use of forward-looking terminology such as “believes,” “expects,” “anticipates,” “estimates” or similar expressions, including, but not limited to, statements regarding the continued demand for China Agritech’s products, China Agritech’s ability to sustain growth for the balance of the year and China Agritech’s ability to generally meet all of its objectives. Such forward-looking statements involve known and unknown risks and uncertainties, including all business uncertainties relating to product development, marketing, concentration in a single customer, raw material costs, market acceptance, future capital requirements, and competition in general and other factors that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. Certain of these risks and uncertainties are or will be described in greater detail in our filings with the SEC. Except as required by law, China Agritech is under no obligation to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

Benefits of CyberKnife Radiosurgery for Lung Cancer Drive Continued Adoption

Feb. 5, 2010 (PR Newswire) — Benefits of CyberKnife Radiosurgery for Lung Cancer Drive Continued Adoption

SUNNYVALE, Calif. — Accuray Incorporated (Nasdaq: ARAY), a global leader in the field of radiosurgery, announced today that more than 12,000 courses of lung cancer treatment have been completed with CyberKnife radiosurgery. Usage of CyberKnife radiosurgery for lung cancer continues to grow, as illustrated by a 25 percent increase year over year in calendar year 2009.

CyberKnife radiosurgery offers lung cancer patients a non-invasive means for treating their disease. The outpatient treatment is completed in five or fewer visits, and is both painless and non-surgical. Because the CyberKnife System utilizes continual image guidance along with continual correction for respiratory motion, it is able to deliver high-doses of radiation to the tumor from hundreds of angles with pinpoint precision.

Judith, a lung cancer survivor, shares her experience having been treated with both conventional lung cancer treatments and CyberKnife radiosurgery:

Judith was diagnosed with stage IIIa lung cancer in the winter of 2004. At that time she received 12 rounds chemotherapy, 23 days of radiation therapy and surgery two weeks later to remove the upper lobe of her right lung. Recovery from her treatment was difficult, involving a 15 day hospital stay and four weeks of recovery at home. During a follow-up visit, some residual cancer was discovered leading her to undergo eight more rounds of chemotherapy. Judith hoped the worst of things were behind her and for almost three years they were.

Then in the summer of 2007 doctors found a recurrence of her cancer in a lymph node located deep in the center of Judith’s chest. Since she had already undergone surgery and had received conventional radiation years prior and given the location of the cancer close to sensitive, vital structures in her chest, her thoracic surgeon suggested CyberKnife radiosurgery. Because of its extreme precision, the CyberKnife System is able to focus the radiation delivery on the tumor and avoid surrounding healthy tissue, meaning Judith was a candidate despite having previous radiation. Judith’s CyberKnife treatment was completed in four outpatient sessions. She was able to resume her daily activities after each treatment and got back to work right away. Nearly three years later Judith is doing well and has had no recurrences.

“The first time round, it was an eight month period of my life spent at the cancer center, so the second time, when I had the option to do four treatments over two weeks and be done, it was a no brainer,” said Judith. “With the CyberKnife there was no downtime and I didn’t experience any side effects. During the treatments I just lay comfortably on the treatment table and was able to watch the animal channel on a TV in the ceiling. It was a piece of cake compared to what I had been through already.”

To view a brief interview with Judith, please visit: http://www.youtube.com/cyberknifeckcam.

About the CyberKnife® Robotic Radiosurgery System

The CyberKnife Robotic Radiosurgery System is the world’s only robotic radiosurgery system designed to treat tumors anywhere in the body non-invasively. Using continual image guidance technology and computer controlled robotic mobility, the CyberKnife System automatically tracks, detects and corrects for tumor and patient movement in real-time throughout the treatment. This enables the CyberKnife System to deliver high-dose radiation with pinpoint precision, which minimizes damage to surrounding healthy tissue and eliminates the need for invasive head or body stabilization frames.

About Accuray

Accuray Incorporated (Nasdaq: ARAY), based in Sunnyvale, Calif., is a global leader in the field of radiosurgery dedicated to providing an improved quality of life and a non-surgical treatment option for those diagnosed with cancer. Accuray develops and markets the CyberKnife Robotic Radiosurgery System, which extends the benefits of radiosurgery to include extracranial tumors, including those in the spine, lung, prostate, liver and pancreas. To date, the CyberKnife System has been used to deliver more than 80,000 treatments worldwide and currently 190 systems have been installed in leading hospitals in the Americas, Europe and Asia. For more information, please visit www.accuray.com.

Safe Harbor Statement

The foregoing may contain certain forward-looking statements that involve risks and uncertainties, including uncertainties associated with the medical device industry. Except for the historical information contained herein, the matters set forth in this press release, including statements relating to clinical studies, regulatory review and approval, and commercialization of products are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements speak only as of the date the statements are made and are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events. You should not put undue reliance on any forward-looking statements. Important factors that could cause actual performance and results to differ materially from the forward-looking statements we make include: market acceptance of products; competing products, the combination of our products with complementary technology; and other risks detailed from time to time under the heading “Risk Factors” in our report on Form 10-K for the 2009 fiscal year, our quarterly report on Form 10-Q filed on February 4, 2010 and our other filings with the Securities and Exchange Commission. The Company’s actual results of operations may differ significantly from those contemplated by such forward-looking statements as a result of these and other factors. We assume no obligation to update forward-looking statements to reflect actual performance or results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws.

Kelly Services (KELYA) Reports 4th Quarter 2009 and Year-End Results

TROY, MI, Feb. 5, 2010 (Marketwire) —

TROY, MI — (Marketwire) — 02/05/10 — Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a world leader in workforce solutions, today announced results for the fourth quarter and year ended January 3, 2010.

Carl T. Camden, President and Chief Executive Officer, announced revenue for the fourth quarter of 2009 totaled $1.2 billion, a 7% decrease compared to the corresponding quarter in 2008. On a sequential basis, fourth quarter revenue increased 14%, compared to the third quarter in 2009. Revenue for the full year totaled $4.3 billion, a 22% decrease compared to the prior year. The fourth quarter included an extra week which adds approximately 4-5% to our quarterly comparisons and 1% to annual comparisons.

Losses from operations for the fourth quarter of 2009 totaled $13.0 million, compared to losses from operations of $83.7 million reported for the fourth quarter of 2008. Included in the results from operations for the fourth quarter of 2009 are restructuring charges of $13.4 million. The loss from operations in the fourth quarter of 2008 included impairment charges of $80.5 million and restructuring charges of $4.3 million. Excluding the impairment and restructuring charges, earnings from operations were $0.4 million in the fourth quarter of 2009 compared to $1.1 million in 2008.

Losses from operations for the full year of 2009 totaled $146.1 million compared to a loss of $70.3 million in 2008. The results for the full year 2009 include $53.1 million of impairment charges, $5.3 million of legal charges and $29.9 million of restructuring charges. The results for 2008 included $80.5 million of impairment charges, $22.5 million of legal charges and $6.5 million of restructuring charges.

Diluted losses per share from continuing operations in the fourth quarter of 2009 were $0.23 compared to fourth quarter 2008 losses of $2.55 per share. The restructuring charges totaled $0.29 per share in the fourth quarter of 2009. The impairment charges were $2.22 per share and the restructuring charges were $0.11 per share in the fourth quarter of 2008.

Diluted losses per share from continuing operations for the full year of 2009 were $3.01 compared to 2008 losses of $2.35 per share. The impairment charges totaled $1.43 per share, legal charges totaled $0.09 per share and restructuring charges totaled $0.69 per share in 2009. The impairment charges were $2.22 per share, legal charges were $0.40 per share and the restructuring charges were $0.15 per share in 2008.

Commenting on the fourth quarter results, Camden was optimistic. “We are very pleased that the improved revenue trends in our business, combined with our significant cost reduction initiatives allowed us to realize a small operating profit for the fourth quarter, excluding restructuring charges.”

Camden added that while 2009 has been a challenging year for the staffing industry, “Kelly has done an excellent job of re-shaping and strategically positioning the company to seize future growth opportunities and create value for our shareholders.

“We look forward to 2010, and will focus on maximizing profitability across all operations; accelerating growth of higher-margin Professional & Technical disciplines and outsourcing and consulting services; winning new business; and helping our customers manage their ever-changing workforce needs.”

In conjunction with its fourth quarter earnings release, Kelly Services, Inc. will host a conference call at 9:00 a.m. (ET) on February 5, to review the results and answer questions. The call may be accessed in one of the following ways:

Via the Telephone:

U.S. 1 800 288-9626International 1 612 332-0107

The pass code is Kelly Services

Via the Internet:

The call is also available via the internet through the Kelly Services website: www.kellyservices.com

This release contains statements that are forward looking in nature and accordingly, are subject to risks and uncertainties. These factors include: competition, changing market and economic conditions, currency fluctuations, changes in laws and regulations, including tax laws, and other factors discussed in this release and in the Company’s filings with the Securities and Exchange Commission. Actual results may differ materially from any forward-looking statements contained herein.

About Kelly Services

Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB) is a leader in providing workforce solutions. Kelly offers a comprehensive array of outsourcing and consulting services as well as world-class staffing on a temporary, temp-to-hire and permanent placement basis. Serving clients around the globe, Kelly provides employment to 480,000 employees annually. Revenue in 2009 was $4.3 billion. Visit www.kellyservices.com.

KELLY SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGSFOR THE 14 WEEKS ENDED JANUARY 3, 2010 AND 13 WEEKS ENDED DECEMBER 28, 2008 (UNAUDITED) (In millions of dollars except per share data) 2009 2008 Change % Change ——— ——— ——— ——–Revenue from services $ 1,194.1 $ 1,279.1 $ (85.0) (6.6)%Cost of services 1,005.8 1,054.5 (48.7) (4.6) ——— ——— ——— ——–Gross profit 188.3 224.6 (36.3) (16.2)Selling, general and administrative expenses 201.3 227.8 (26.5) (11.7)Asset impairments – 80.5 (80.5) (100.0) ——— ——— ——— ——–Loss from operations (13.0) (83.7) 70.7 84.5Other expense, net (0.9) (3.4) 2.5 73.8 ——— ——— ——— ——–Loss from continuing operations before taxes (13.9) (87.1) 73.2 84.1Income taxes (5.7) 1.5 (7.2) (469.5) ——— ——— ——— ——–Loss from continuing operations (8.2) (88.6) 80.4 90.8Loss from discontinued operations, net of tax – (0.1) 0.1 100.0 ——— ——— ——— ——–Net loss $ (8.2) $ (88.7) $ 80.5 90.8 % ========= ========= ========= ========Basic loss per share on common stock Loss from continuing operations $ (0.23) $ (2.55) $ 2.32 91.0 % Loss from discontinued operations – (0.01) 0.01 100.0 Net loss (0.23) (2.55) 2.32 91.0Diluted loss per share on common stock Loss from continuing operations $ (0.23) $ (2.55) $ 2.32 91.0 % Loss from discontinued operations – (0.01) 0.01 100.0 Net loss (0.23) (2.55) 2.32 91.0 ——— ——— ——— ——–STATISTICS:Gross profit rate 15.8 % 17.6 % (1.8)pts.Selling, general and administrative expenses: % of revenue 16.8 17.8 (1.0) % of gross profit 106.9 101.4 5.5% Return – Loss from operations (1.1) (6.5) 5.4 Loss from continuing operations before taxes (1.2) (6.8) 5.6 Loss from continuing operations (0.7) (6.9) 6.2 Net loss (0.7) (6.9) 6.2Effective income tax rate 41.0 % (1.8) % 42.8 pts. KELLY SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGSFOR THE 53 WEEKS ENDED JANUARY 3, 2010 AND 52 WEEKS ENDED DECEMBER 28, 2008 (In millions of dollars except per share data) 2009 2008 Change % Change ———- ———- ———- ———Revenue from services $ 4,314.8 $ 5,517.3 $ (1,202.5) (21.8)%Cost of services 3,613.1 4,539.7 (926.6) (20.4) ———- ———- ———- ———Gross profit 701.7 977.6 (275.9) (28.2)Selling, general and administrative expenses 794.7 967.4 (172.7) (17.9)Asset impairments 53.1 80.5 (27.4) (34.1) ———- ———- ———- ———Loss from operations (146.1) (70.3) (75.8) (107.8)Other expense, net (2.2) (3.4) 1.2 35.8 ———- ———- ———- ———Loss from continuing operations before taxes (148.3) (73.7) (74.6) (101.1)Income taxes (43.2) 8.0 (51.2) NM ———- ———- ———- ———Loss from continuing operations (105.1) (81.7) (23.4) (28.6)Earnings (loss) from discontinued operations, net of tax 0.6 (0.5) 1.1 212.0 ———- ———- ———- ———Net loss $ (104.5) $ (82.2) $ (22.3) (27.0)% ========== ========== ========== =========Basic loss per share on common stock Loss from continuing operations $ (3.01) $ (2.35) $ (0.66) (28.1)% Earnings (loss) from discontinued operations 0.02 (0.02) 0.04 200.0 Net loss (3.00) (2.37) (0.63) (26.6)Diluted loss per share on common stock Loss from continuing operations $ (3.01) $ (2.35) $ (0.66) (28.1)% Earnings (loss) from discontinued operations 0.02 (0.02) 0.04 200.0 Net loss (3.00) (2.37) (0.63) (26.6) ———- ———- ———- ———STATISTICS:Gross profit rate 16.3 % 17.7 % (1.4)pts.Selling, general and administrative expenses: % of revenue 18.4 17.5 0.9 % of gross profit 113.2 99.0 14.2% Return – Loss from operations (3.4) (1.3) (2.1) Loss from continuing operations before taxes (3.4) (1.3) (2.1) Loss from continuing operations (2.4) (1.5) (0.9) Net loss (2.4) (1.5) (0.9)Effective income tax rate 29.1 % (10.8) % 39.9 pts. KELLY SERVICES, INC. AND SUBSIDIARIES RESULTS OF OPERATIONS BY SEGMENT (UNAUDITED) (In millions of dollars) Fourth Quarter —————————————- Constant 2009 2008 Currency (14 Weeks)(13 Weeks) Change Change ——– ——– ———- ——-Americas Commercial Revenue from services (including fee-based income) $ 557.4 $ 595.6 (6.4)% (7.3)% Fee-based income 1.5 2.8 (46.7) (48.3) Gross profit 79.8 96.4 (17.2) (18.0) SG&A expenses excluding restructuring charges 67.9 79.7 (14.8) Restructuring charges 3.5 0.6 450.2 Total SG&A expenses 71.4 80.3 (11.1) (11.9) Earnings from operations 8.4 16.1 (47.7) Earnings from operations excluding restructuring charges 11.9 16.7 (28.9) Gross profit rate 14.3% 16.2% (1.9)pts. Expense rates (excluding restructuring charges): % of revenue 12.2 13.4 (1.2) % of gross profit 85.0 82.5 2.5 Operating margin (excluding restructuring charges) 2.2 2.8 (0.6)Americas PT Revenue from services (including fee-based income) $ 208.3 $ 219.3 (5.0)% (5.3)% Fee-based income 2.2 3.7 (39.8) (40.0) Gross profit 31.9 37.5 (14.9) (15.1) SG&A expenses excluding restructuring charges 24.7 27.8 (11.0) Restructuring charges 0.8 – NM Total SG&A expenses 25.5 27.8 (8.1) (8.3) Earnings from operations 6.4 9.7 (34.4) Earnings from operations excluding restructuring charges 7.2 9.7 (26.2) Gross profit rate 15.3% 17.1% (1.8)pts. Expense rates (excluding restructuring charges): % of revenue 11.9 12.7 (0.8) % of gross profit 77.5 74.1 3.4 Operating margin (excluding restructuring charges) 3.4 4.4 (1.0)EMEA Commercial Revenue from services (including fee-based income) $ 238.9 $ 283.3 (15.7)% (22.8)% Fee-based income 4.3 7.5 (42.6) (45.6) Gross profit 37.4 47.6 (21.5) (28.3) SG&A expenses excluding restructuring charges 35.2 51.4 (31.4) Restructuring charges 4.9 3.0 60.0 Total SG&A expenses 40.1 54.4 (26.3) (32.5) Earnings from operations (2.7) (6.8) 59.9 Earnings from operations excluding restructuring charges 2.2 (3.8) NM Gross profit rate 15.7% 16.8% (1.1)pts. Expense rates (excluding restructuring charges): % of revenue 14.8 18.1 (3.3) % of gross profit 94.2 107.8 (13.6) Operating margin (excluding restructuring charges) 0.9 (1.3) 2.2 KELLY SERVICES, INC. AND SUBSIDIARIES RESULTS OF OPERATIONS BY SEGMENT (continued) (UNAUDITED) (In millions of dollars) Fourth Quarter —————————————– Constant 2009 2008 Currency (14 Weeks)(13 Weeks) Change Change ——– ——– ——– ——-EMEA PT Revenue from services (including fee-based income) $ 39.6 $ 38.4 3.0 % (6.1)% Fee-based income 3.6 5.5 (34.4) (37.4) Gross profit 9.8 11.2 (12.7) (19.4) Total SG&A expenses 10.6 11.7 (9.5) (17.1) Earnings from operations (0.8) (0.5) (58.0) Gross profit rate 24.7% 29.1% (4.4)pts. Expense rates: % of revenue 26.8 30.5 (3.7) % of gross profit 108.5 104.7 3.8 Operating margin (2.1) (1.4) (0.7)APAC Commercial Revenue from services (including fee-based income) $ 83.0 $ 73.5 12.9 % (2.2)% Fee-based income 2.9 3.0 (6.2) (15.2) Gross profit 12.1 11.4 6.8 (7.8) SG&A expenses excluding restructuring charges 11.6 12.4 (7.2) Restructuring charges 1.4 – NM Total SG&A expenses 13.0 12.4 4.6 (9.8) Earnings from operations (0.9) (1.0) 19.7 Earnings from operations excluding restructuring charges 0.5 (1.0) NM Gross profit rate 14.6% 15.5% (0.9)pts. Expense rates (excluding restructuring charges): % of revenue 13.9 16.9 (3.0) % of gross profit 95.0 109.3 (14.3) Operating margin (excluding restructuring charges) 0.7 (1.4) 2.1APAC PT Revenue from services (including fee-based income) $ 7.2 $ 7.2 (0.4)% (15.9)% Fee-based income 1.0 0.8 29.9 17.7 Gross profit 2.1 1.9 7.8 (7.0) Total SG&A expenses 2.6 2.2 19.3 2.4 Earnings from operations (0.5) (0.3) (106.4) Gross profit rate 28.6% 26.4% 2.2 pts. Expense rates: % of revenue 35.8 29.9 5.9 % of gross profit 125.2 113.1 12.1 Operating margin (7.2) (3.5) (3.7) KELLY SERVICES, INC. AND SUBSIDIARIES RESULTS OF OPERATIONS BY SEGMENT (continued) (UNAUDITED) (In millions of dollars) Fourth Quarter ——————————————- Constant 2009 2008 Currency (14 Weeks) (13 Weeks) Change Change ——— ——— ——- ——–OCG Revenue from services (including fee-based income) $ 68.2 $ 68.4 (0.3)% (1.3)% Fee-based income 6.0 7.2 (16.2) (19.6) Gross profit 15.5 18.9 (18.0) (19.6) SG&A expenses excluding restructuring charges 17.9 18.0 (0.8) Restructuring charges 1.3 0.4 239.5 Total SG&A expenses 19.2 18.4 4.1 1.1 Earnings from operations (3.7) 0.5 NM Earnings from operations excluding restructuring charges (2.4) 0.9 NM Gross profit rate 22.7% 27.6% (4.9)pts. Expense rates (excluding restructuring charges): % of revenue 26.2 26.4 (0.2) % of gross profit 115.7 95.6 20.1 Operating margin (excluding restructuring charges) (3.6) 1.2 (4.8)Corporate Expense SG&A expenses excluding restructuring charges $ 17.7 $ 20.6 (14.2)% Restructuring charges 1.5 0.3 418.1 Total SG&A expenses 19.2 20.9 (8.1) (8.1)Asset Impairments $ – $ 80.5 (100.0)%Consolidated Total (excluding intersegment activity) Revenue from services (including fee-based income) $ 1,194.1 $ 1,279.1 (6.6)% (10.0)% Fee-based income 21.5 30.5 (29.5) (33.0) Gross profit 188.3 224.6 (16.2) (19.4) SG&A expenses excluding restructuring charges 187.9 223.5 (16.0) Restructuring charges 13.4 4.3 209.0 Total SG&A expenses 201.3 227.8 (11.7) (15.1) Earnings from operations (13.0) (83.7) 84.5 Earnings from operations excluding restructuring charges 0.4 (79.4) NM Gross profit rate 15.8% 17.6% (1.8)pts. Expense rates (excluding restructuring charges): % of revenue 15.7 17.5 (1.8) % of gross profit 99.8 99.4 0.4 Operating margin (excluding restructuring charges) 0.0 (6.2) 6.2 KELLY SERVICES, INC. AND SUBSIDIARIES RESULTS OF OPERATIONS BY SEGMENT (UNAUDITED) (In millions of dollars) December Year to Date ——————————————– Constant 2009 2008 Currency (53 Weeks) (52 Weeks) Change Change ——— ——— ——— ——–Americas Commercial Revenue from services (including fee-based income) $ 1,980.3 $ 2,516.7 (21.3) % (20.3)% Fee-based income 6.6 15.7 (58.4) (56.8) Gross profit 290.7 399.0 (27.1) (26.3) SG&A expenses excluding restructuring charges 273.2 328.2 (16.7) Restructuring charges 7.2 0.9 NM Total SG&A expenses 280.4 329.1 (14.8) (13.8) Earnings from operations 10.3 69.9 (85.1) Earnings from operations excluding restructuring charges 17.5 70.8 (75.2) Gross profit rate 14.7% 15.9% (1.2)pts. Expense rates (excluding restructuring charges): % of revenue 13.8 13.0 0.8 % of gross profit 93.9 82.2 11.7 Operating margin (excluding restructuring charges) 0.9 2.8 (1.9)Americas PT Revenue from services (including fee-based income) $ 792.6 $ 938.2 (15.5)% (15.4)% Fee-based income 9.4 19.4 (51.5) (51.4) Gross profit 125.1 161.7 (22.6) (22.5) SG&A expenses excluding restructuring charges 100.9 113.3 (10.9) Restructuring charges 1.0 – NM Total SG&A expenses 101.9 113.3 (10.0) (9.8) Earnings from operations 23.2 48.4 (52.2) Earnings from operations excluding restructuring charges 24.2 48.4 (50.0) Gross profit rate 15.8% 17.2% (1.4)pts. Expense rates (excluding restructuring charges): % of revenue 12.7 12.1 0.6 % of gross profit 80.7 70.1 10.6 Operating margin (excluding restructuring charges) 3.0 5.2 (2.2)EMEA Commercial Revenue from services (including fee-based income) $ 895.2 $ 1,310.5 (31.7)% (24.9)% Fee-based income 16.6 39.5 (58.0) (52.6) Gross profit 140.2 227.3 (38.4) (32.5) SG&A expenses excluding restructuring charges 150.3 226.5 (33.7) Restructuring charges 15.6 3.9 301.4 Total SG&A expenses 165.9 230.4 (28.0) (20.2) Earnings from operations (25.7) (3.1) NM Earnings from operations excluding restructuring charges (10.1) 0.8 NM Gross profit rate 15.7% 17.4% (1.7)pts. Expense rates (excluding restructuring charges): % of revenue 16.8 17.3 (0.5) % of gross profit 107.2 99.6 7.6 Operating margin (excluding restructuring charges) (1.1) 0.1 (1.2) KELLY SERVICES, INC. AND SUBSIDIARIES RESULTS OF OPERATIONS BY SEGMENT (continued) (UNAUDITED) (In millions of dollars) December Year to Date —————————————- Constant 2009 2008 Currency (53 Weeks)(52 Weeks) Change Change ——– ——– ——– ——-EMEA PT Revenue from services (including fee-based income) $ 141.9 $ 172.5 (17.8)% (10.7)% Fee-based income 15.7 26.8 (41.2) (33.2) Gross profit 37.8 51.2 (26.2) (18.8) Total SG&A expenses 40.6 48.9 (16.9) (8.5) Earnings from operations (2.8) 2.3 NM Gross profit rate 26.6% 29.7% (3.1)pts. Expense rates: % of revenue 28.6 28.3 0.3 % of gross profit 107.6 95.5 12.1 Operating margin (2.0) 1.3 (3.3)APAC Commercial Revenue from services (including fee-based income) $ 284.9 $ 336.0 (15.2)% (11.0)% Fee-based income 9.7 17.0 (43.0) (40.6) Gross profit 41.6 56.3 (26.1) (22.6) SG&A expenses excluding restructuring charges 44.6 56.6 (21.3) Restructuring charges 1.6 – NM Total SG&A expenses 46.2 56.6 (18.5) (14.8) Earnings from operations (4.6) (0.3) NM Earnings from operations excluding restructuring charges (3.0) (0.3) NM Gross profit rate 14.6% 16.8% (2.2)pts. Expense rates (excluding restructuring charges): % of revenue 15.6 16.8 (1.2) % of gross profit 107.0 100.5 6.5 Operating margin (excluding restructuring charges) (1.0) (0.1) (0.9)APAC PT Revenue from services (including fee-based income) $ 25.4 $ 34.3 (26.0)% (24.3)% Fee-based income 3.8 5.1 (25.0) (21.0) Gross profit 7.7 10.2 (25.1) (22.6) Total SG&A expenses 9.2 10.7 (14.2) (9.9) Earnings from operations (1.5) (0.5) (224.9) Gross profit rate 30.2% 29.8% 0.4 pts. Expense rates: % of revenue 36.2 31.2 5.0 % of gross profit 119.8 104.6 15.2 Operating margin (6.0) (1.4) (4.6) KELLY SERVICES, INC. AND SUBSIDIARIES RESULTS OF OPERATIONS BY SEGMENT (continued) (UNAUDITED) (In millions of dollars) December Year to Date —————————————— Constant 2009 2008 Currency (53 Weeks) (52 Weeks) Change Change ——— ——— ——– ——–OCG Revenue from services (including fee-based income) $ 219.9 $ 233.3 (5.7)% (4.7)% Fee-based income 24.4 27.8 (12.3) (9.4) Gross profit 59.7 72.9 (18.0) (16.1) SG&A expenses excluding restructuring charges 69.6 69.5 0.0 Restructuring charges 1.9 0.5 328.4 Total SG&A expenses 71.5 70.0 2.0 4.3 Earnings from operations (11.8) 2.9 NM Earnings from operations excluding restructuring charges (9.9) 3.4 NM Gross profit rate 27.2% 31.2% (4.0)pts. Expense rates (excluding restructuring charges): % of revenue 31.7 29.8 1.9 % of gross profit 116.6 95.6 21.0 Operating margin (excluding restructuring charges) (4.5) 1.4 (5.9)Corporate Expense SG&A expenses excluding restructuring charges $ 77.5 $ 108.2 (28.4)% Restructuring charges 2.6 1.2 116.3 Total SG&A expenses 80.1 109.4 (26.8) (26.8)Asset Impairments $ 53.1 $ 80.5 (34.1)%Consolidated Total (excluding intersegment activity) Revenue from services (including fee-based income) $ 4,314.8 $ 5,517.3 (21.8)% (19.2)% Fee-based income 86.1 151.3 (43.1) (39.2) Gross profit 701.7 977.6 (28.2) (25.7) SG&A expenses excluding restructuring charges 764.8 960.9 (20.4) Restructuring charges 29.9 6.5 360.9 Total SG&A expenses 794.7 967.4 (17.9) (14.8) Earnings from operations (146.1) (70.3) (107.8) Earnings from operations excluding restructuring charges (116.2) (63.8) (82.0) Gross profit rate 16.3% 17.7% (1.4)pts. Expense rates (excluding restructuring charges): % of revenue 17.7 17.4 0.3 % of gross profit 109.0 98.3 10.7 Operating margin (excluding restructuring charges) (2.7) (1.2) (1.5) KELLY SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In millions of dollars) January 3, December 28, 2010 2008 ———— ————Current Assets Cash and equivalents $ 88.9 $ 118.3 Trade accounts receivable, less allowances of $15.0 and $17.0, respectively 717.9 815.8 Prepaid expenses and other current assets 70.6 62.0 Deferred taxes 21.0 31.9 ———— ———— Total current assets 898.4 1,028.0Property and Equipment, Net 127.1 151.3Noncurrent Deferred Taxes 77.5 40.0Goodwill, Net 67.3 117.8Other Assets 131.4 120.2 ———— ————Total Assets $ 1,301.7 $ 1,457.3 ============ ============Current Liabilities Short-term borrowings and current portion of long-term debt $ 79.6 $ 35.2 Accounts payable and accrued liabilities 182.6 244.1 Accrued payroll and related taxes 208.3 243.2 Accrued insurance 19.7 26.3 Income and other taxes 47.4 51.8 ———— ———— Total current liabilities 537.6 600.6Noncurrent Liabilities Long-term debt 57.5 80.0 Accrued insurance 47.3 46.9 Accrued retirement benefits 76.9 61.6 Other long-term liabilities 16.0 15.3 ———— ———— Total noncurrent liabilities 197.7 203.8Stockholders’ Equity Common stock 40.1 40.1 Treasury stock (107.2) (111.2) Paid-in capital 36.9 35.8 Earnings invested in the business 571.5 676.0 Accumulated other comprehensive income 25.1 12.2 ———— ———— Total stockholders’ equity 566.4 652.9 ———— ————Total Liabilities and Stockholders’ Equity $ 1,301.7 $ 1,457.3 ============ ============ ———— ————STATISTICS: Working Capital $ 360.8 $ 427.4 Current Ratio 1.7 1.7 Debt-to-capital % 19.5% 15.0% Global Days Sales Outstanding 51 50 KELLY SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE 53 WEEKS ENDED JANUARY 3, 2010 AND 52 WEEKS ENDED DECEMBER 28, 2008 (In millions of dollars) 2009 2008 ——— ———Cash flows from operating activities Net loss $ (104.5) $ (82.2) Noncash adjustments: Impairment of assets 53.1 80.5 Depreciation and amortization 40.9 46.0 Provision for bad debts 2.2 6.7 Stock-based compensation 5.1 4.4 Other, net (2.2) 3.7 Changes in operating assets and liabilities (11.8) 42.5 ——— ——— Net cash from operating activities (17.2) 101.6 ——— ———Cash flows from investing activities Capital expenditures (13.1) (31.1) Acquisition of companies, net of cash received (7.5) (32.7) Other investing activities (2.8) (0.2) ——— ——— Net cash from investing activities (23.4) (64.0) ——— ———Cash flows from financing activities Net change in revolving line of credit 52.7 (34.2) Repayment of debt (30.5) – Proceeds from debt – 42.5 Dividend payments – (19.1) Purchase of treasury stock – (8.0) Other financing activities (12.8) 10.0 ——— ——— Net cash from financing activities 9.4 (8.8) ——— ———Effect of exchange rates on cash and equivalents 1.8 (3.3) ——— ———Net change in cash and equivalents (29.4) 25.5Cash and equivalents at beginning of period 118.3 92.8 ——— ———Cash and equivalents at end of period $ 88.9 $ 118.3 ========= ========= KELLY SERVICES, INC. AND SUBSIDIARIES REVENUE FROM SERVICES (UNAUDITED) (In millions of dollars) Fourth Quarter (Commercial, PT and OCG) ——————————————— % Change 2009 2008 Constant (14 Weeks) (13 Weeks) US$ Currency ———– ———– ——— ———Americas United States $ 733.1 $ 781.5 (6.2)% (6.2)% Canada 51.5 50.2 2.7 (9.9) Mexico 19.0 18.1 5.3 6.6 Puerto Rico 15.0 18.7 (19.7) (19.7) ———– ———–Total Americas 818.6 868.5 (5.7) (6.4)EMEA France 78.7 75.1 4.7 (6.2) United Kingdom 43.1 80.7 (46.5) (48.1) Switzerland 38.8 41.4 (6.4) (17.5) Russia 19.9 22.3 (10.8) (3.3) Portugal 19.4 15.6 24.4 11.3 Italy 19.0 25.2 (24.8) (32.9) Germany 17.6 17.7 0.3 (10.5) Norway 17.3 16.9 1.7 (14.2) Other 29.0 32.7 (11.4) (20.1) ———– ———–Total EMEA 282.8 327.6 (13.7) (21.0)APAC Australia 30.4 26.0 16.9 (13.1) Singapore 17.9 16.1 10.9 4.1 Malaysia 13.7 12.3 12.3 7.7 Other 30.7 28.6 7.0 (3.8) ———– ———–Total APAC 92.7 83.0 11.6 (3.5)Total Kelly Services, Inc. $ 1,194.1 $ 1,279.1 (6.6)% (10.0)% =========== =========== KELLY SERVICES, INC. AND SUBSIDIARIES REVENUE FROM SERVICES (UNAUDITED) (In millions of dollars) December Year to Date (Commercial, PT and OCG) ———————————————- % Change 2009 2008 Constant (53 Weeks) (52 Weeks) US$ Currency ———– ———– ——— ———Americas United States $ 2,634.3 $ 3,237.1 (18.6)% (18.6)% Canada 183.4 237.8 (22.9) (17.5) Mexico 66.5 76.2 (12.7) 6.2 Puerto Rico 57.9 77.4 (25.2) (25.2) ———– ———–Total Americas 2,942.1 3,628.5 (18.9) (18.2)EMEA France 272.7 350.8 (22.3) (18.3) United Kingdom 206.7 398.0 (48.1) (37.0) Switzerland 138.6 184.9 (25.1) (25.2) Italy 72.9 131.9 (44.7) (41.5) Russia 65.4 90.9 (28.0) (8.9) Germany 65.1 83.0 (21.5) (17.2) Norway 61.7 86.1 (28.4) (18.9) Portugal 59.5 27.5 116.5 124.9 Other 111.2 154.4 (28.0) (22.1) ———– ———–Total EMEA 1,053.8 1,507.5 (30.1) (23.3)APAC Australia 98.3 133.7 (26.4) (21.3) Singapore 64.4 71.3 (9.6) (7.3) Malaysia 50.1 55.2 (9.2) (4.1) Other 106.1 121.1 (12.5) (9.0) ———– ———–Total APAC 318.9 381.3 (16.4) (12.3)Total Kelly Services, Inc. $ 4,314.8 $ 5,517.3 (21.8)% (19.2)% =========== =========== KELLY SERVICES, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED) (In millions of dollars except per share data) December Fourth Quarter Year to Date —————— —————— 2009 2008 2009 2008 ——– ——– ——– ——–Pretax loss from operations $ (13.0) $ (83.7) $ (146.1) $ (70.3)Restructuring charges (Note 1) 13.4 4.3 29.9 6.5Asset impairments (Note 2) – 80.5 53.1 80.5Litigation charges – – 5.3 22.5 ——– ——– ——– ——–Earnings (loss) from operations excluding restructuring, asset impairment and litigation charges $ 0.4 $ 1.1 $ (57.8) $ 39.2 ======== ======== ======== ======== Fourth Quarter ————————————– 2009 2008 —————— —————— Per Per Amount Share Amount Share ——– ——– ——– ——–Loss from continuing operations, net of tax $ (8.2) $ (0.23) $ (88.6) $ (2.55)Restructuring charges, net of taxes (Note 1) 10.1 0.29 3.7 0.11Asset impairments, net of taxes (Note 2) – – 77.2 2.22 ——– ——–Earnings (loss) from continuing operations excluding restructuring and asset impairment charges, net of taxes $ 1.9 $ 0.05 $ (7.7) $ (0.22) ======== ======== ======== ======== December Year to Date ————————————– 2009 2008 —————— —————— Per Per Amount Share Amount Share ——– ——– ——– ——–Loss from continuing operations, net of tax $ (105.1) $ (3.01) $ (81.7) $ (2.35)Restructuring charges, net of taxes (Note 1) 24.0 0.69 5.3 0.15Asset impairments, net of taxes (Note 2) 50.0 1.43 77.2 2.22Litigation charges, net of taxes 3.3 0.09 13.9 0.40 ——– ——–(Loss) earnings from continuing operations excluding restructuring, asset impairment and litigation charges, net of taxes $ (27.8) $ (0.80) $ 14.7 $ 0.42 ======== ======== ======== ======== KELLY SERVICES, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED)Management believes that the non-GAAP (Generally Accepted AccountingPrinciples) information excluding the impairment, restructuring andlitigation charges is useful to understand the Company’s fiscal 2009financial performance and increases comparability. Specifically,Management believes that excluding these items allows for a more meaningfulcomparison of current period operating performance with the operatingresults of prior periods. These non-GAAP measures may have limitations asanalytical tools because they exclude items which can have a materialimpact on cash flow and earnings per share. As a result, Managementconsiders these measures, along with reported results, when it reviews andevaluates the Company’s financial performance. Management believes thatthese measures provide greater transparency to investors and provideinsight into how Management is evaluating the Company’s financialperformance. Non-GAAP measures should not be considered a substitute for,or superior to, measures of financial performance prepared in accordancewith GAAP.(1) Restructuring charges represent global costs incurred in connection with the reduction in the number of permanent employees and the consolidation, sale or closure of branch locations. These costs include severance, lease terminations, asset write-offs and other miscellaneous costs.(2) For 2009, asset impairment charges include adjustments to the value of goodwill for the Company’s Americas Commercial, EMEA PT and APAC Commercial reporting segments, and long-lived assets and intangible assets related to Japan and Europe. For 2008, asset impairment charges include adjustments to the value of goodwill for the Company’s EMEA Commercial segment, the Company’s investment in Tempstaff, and assets related to operations in the U.K.

SkyPeople Fruit Juice, Inc. (SPU) Receives Independent Research Coverage from EquityNet Research

EquityNet Research, an independent West Coast equity research firm, announced today that it has initiated coverage of SkyPeople Fruit Juice, Inc. (AMEX: SPU). Investors may receive a full copy of the report and disclosure requirements at EquityNet Research’s Website: www.equitynet.net.

SkyPeople, through its subsidiary Shaanxi Tianren Organic Food Co., Ltd., focuses on producing and selling special concentrated fruit juices, fast-frozen and freeze-dried fruits and vegetables, and fruit juice drink in the People’s Republic of China. The company’s distribution network, already one of the largest in China, is constantly expanding and now includes the United States, Japan, the European Union, the Middle East, Russia, Israel and South Korea.

Randy Lewis, CFA, Founder and Senior Analyst with EquityNet who is covering the Company, stated, “Certainly from a fundamental standpoint, SkyPeople is exhibiting phenomenal growth and financial strength in the midst of a global economic downturn. We feel this is a testament to the increasing industry demand and business model that SkyPeople is executing, and certainly solidifies our confidence in the Company moving forward.”

He continued, “We believe that the Company holds several competitive advantages, including superior technology, advantageous geography and a diversified product line. In addition, the move into branded juices, as a complement to its traditional concentrate lines, was a very smart move. And the push marketing strategy employed with its juice distributors seems to be paying off handsomely.”

Overhill Farms (OFI) Reports Net Income of 19 Cents per Share on Revenues of $56.2 Million

LOS ANGELES, CA — (Marketwire) — 02/04/10 — Overhill Farms, Inc. (NYSE Amex: OFI) today reported net income of $3.1 million, or $0.19 per basic and diluted common share, on net revenues of $56.2 million for the first quarter of fiscal 2010, which ended December 27, 2009. This is an increase of 20.5% from the earnings of $2.5 million or $0.16 per basic and diluted share for the first quarter of fiscal 2009, on an increase in revenues of 1.7% from the $55.3 million of the first quarter of fiscal 2009.

James Rudis, the Company’s Chairman, President and Chief Executive Officer, said, “We are pleased to be able to report these strong results despite the continuing challenges of a difficult economic environment for our customers and our company. Thanks to improvements in our gross margin, we produced a year-over-year increase of more than 20% in net income. Compared to the immediately prior quarter, our net income increased 118% on a 16% increase in revenues.”

Mr. Rudis added, “Based on our strong results, we were able to make a voluntary debt prepayment of $5 million during the period, ending the quarter with cash of $4.9 million. Assuming continued strong performance, our goal is to substantially pay down our remaining debt by the end of the calendar year, which would enable us to consider a number of alternatives for further enhancing stockholder value.”

Mr. Rudis noted that sales to foodservice customers more than doubled from the year-earlier level, supporting the Company’s belief that the foodservice sector continues to represent a significant opportunity. He said this positive outlook is supported by the initial response from major foodservice companies to the Company’s alliance with J.R. Simplot Company formed during the fourth quarter of fiscal 2009, which has already resulted in interest from potential new customers.

Approximately $1.5 million of net revenues in the first quarter of fiscal 2010 were attributable to January 2010 orders that customers placed early because the Company’s facilities were closed over the Christmas and New Year holidays, which were in the first week of the second fiscal quarter.

Retail net revenues were $35.1 million for the first quarter of fiscal 2010, a decrease of $7.3 million or 17.3% from the $42.5 million of the first quarter of the prior fiscal year. The decrease was primarily due to reduced volume from H. J. Heinz Company, as previously announced. The Company anticipates that sales to other retail customers and foodservice accounts will continue to offset reductions in sales to Heinz during fiscal and calendar 2010.

Foodservice net revenues increased by $9.7 million, or 102.1%, to $19.2 million for the first quarter of fiscal 2010, from $9.5 million for the year-earlier quarter. The increase in foodservice revenues was due to higher volume from existing customers, as well as new products for existing and new accounts.

Airline net revenues decreased by $1.4 million, or 42.4%, to $1.9 million for the first quarter of fiscal 2010, from $3.3 million for the first quarter of the prior fiscal year. This decline reflects continuing efforts by the airline industry to cut costs, which may cause further decreases in future periods. The airline category represented 3.4% of total net revenues for the first quarter of fiscal 2010, compared to 6% for the first quarter of the prior fiscal year. The Company continues to transition to opportunities outside of the airline category.

Gross profit as a percentage of net revenues increased to 14.0% for the first quarter of fiscal 2010, from 13.6% for the first quarter of fiscal 2009. Gross profit for the first quarter of fiscal 2010 increased by $379,000, or 5.1% to $7.9 million, from $7.5 million for the first quarter of fiscal 2009. This increase was attributed to improved operating efficiencies and yields, and favorable pricing in commodity contracts, offset partially by price reductions to certain customers.

The Company also announced that it has received favorable rulings, detailed below, in previously disclosed employment-related legal actions. These actions arose out of the termination on May 31, 2009, of approximately 260 employees, following notification by the Internal Revenue Service that these employees were using invalid social security numbers.

On April 28, 2009, Local 770 of the United Food and Commercial Workers Union sought arbitration regarding the then-pending termination of these workers. On January 11, 2010, the arbitrator dismissed the Union’s grievance. On January 29, 2010, the Union filed a petition to vacate the decision in the binding arbitration. The Company believes that the Union has no legitimate basis to vacate the arbitrator’s decision, and intends to seek dismissal of the Union’s petition and to pursue other appropriate remedies.

On June 20, 2009, the Company filed a lawsuit against Nativo Lopez and six other leaders of what the Company believes is an illegal campaign to force it to rehire the workers terminated because of their use of invalid social security numbers. The defendants attempted unsuccessfully to have the Company’s action dismissed. On November 13, 2009, the court ruled that the Company had established a probability of prevailing on the merits, and had submitted substantial evidence that the defendants’ accusations of racism were false, harmed the Company, and were made with malice. The Company will continue to pursue its action against the defendants.

“We are pleased that a number of issues related to the terminations are nearing resolution,” Mr. Rudis said. “These matters have required use of Company resources and management time, but our actions were necessary to protect the Company’s interests.”

About Overhill Farms

Overhill Farms is a leading value-added supplier of custom high quality prepared frozen foods for branded retail, private label, foodservice and airline customers. Its product line includes entrées, plated meals, bulk-packed meal components, pastas, soups, sauces, poultry, meat and fish specialties, as well as organic and vegetarian offerings. The Company’s capabilities give its customers a one-stop solution for new product development, precise replication of existing recipes, product manufacturing and packaging. Its customers include prominent nationally recognized names such as Jenny Craig, Inc., Safeway Inc., Panda Restaurant Group, Inc., H. J. Heinz Company, Pinnacle Foods Group LLC and American Airlines, Inc.

This news release contains disclosures that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations or beliefs and include, but are not limited to, statements about the company’s operations and financial performance and condition and statements regarding expectations of continued or increased sales volumes and revenues, margins, profitability, production efficiencies and expansions, cash flows and growth, anticipated amounts and timing of growth in the company’s customer base and business in the foodservice and retail market sectors, ability and desire to make further voluntary debt reductions, ability to successfully resolve outstanding legal matters. For this purpose, statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, or which include words such as “continue,” “efforts,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” “projects,” “forecasts,” “strategy,” “will,” “goal,” “objective,” “target,” “prospects,” “optimistic,” “confident,” “likely,” “probable” or similar expressions. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), on-going business strategies or prospects, and possible future company actions, which may be provided by management, are also forward-looking statements. We caution that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others: the impact of competitive products and pricing; fulfillment by suppliers of existing raw material contracts; market conditions that may affect the costs and/or availability of raw materials and the Company’s ability to obtain favorable long-term purchase commitments for raw materials, and of fuels, energy, logistics and labor as well as the market for the company’s products, including customers’ ability to pay and consumer demand; changes in business environment, including actions of competitors and changes in customer preferences, as well as disruptions to customers’ businesses; seasonality in the retail category; loss of key customers due to competitive environment or production being moved in-house by customers; difficulties that may be encountered in attracting and retaining new customers; natural disasters that can impact, among other things, costs of fuel and raw materials; the occurrence of acts of terrorism, or acts of war; changes in governmental laws and regulations; change in control due to takeover or other significant changes in ownership; financial viability and resulting effect on revenues and collectability of accounts receivable of customers during recessionary periods; ability to obtain additional financing as and when needed, and rising costs of credit that may be associated with new borrowings; voluntary or government-mandated food recalls; and other factors as may be discussed in the company’s Annual Report on Form 10-K for the year ended September 27, 2009, and other reports filed with the Securities and Exchange Commission.

                         OVERHILL FARMS, INC.

                   CONDENSED SUMMARY OF OPERATIONS

                                                  For the Quarter Ended
                                                --------------------------
                                                December 27,  December 28,
                                                    2009          2008
                                                ------------  ------------

Net revenues                                    $ 56,232,538  $ 55,272,029
Cost of sales                                     48,346,408    47,764,510
                                                ------------  ------------
Gross profit                                       7,886,130     7,507,519

Selling, general and administrative expenses       2,561,781     2,534,216
                                                ------------  ------------

Operating income                                   5,324,349     4,973,303

Interest expense:
  Interest expense                                  (331,114)     (712,584)
  Amortization of debt discount and deferred
   financing costs                                  (101,504)     (101,504)
                                                ------------  ------------
Total interest expense                              (432,618)     (814,088)

Other expense                                         (1,000)            -
                                                ------------  ------------

Income before income taxes                         4,890,731     4,159,215

Income taxes                                       1,837,936     1,626,252

Net income                                      $  3,052,795  $  2,532,963
                                                ============  ============

Net income per share:
  Basic                                         $       0.19  $       0.16
                                                ============  ============
  Diluted                                       $       0.19  $       0.16
                                                ============  ============

Shares used in computing net income per share:
  Basic                                           15,823,271    15,823,271
  Diluted                                         16,051,619    16,018,339

Romi Offers to Acquire Hardinge (HDNG) for $8 Per Share in Cash

Feb. 4, 2010 (PR Newswire) — Romi Offers to Acquire Hardinge for $8 Per Share in Cash

Kulicke & Soffa (KLIC) Reports Results for its First Fiscal Quarter 2010

FORT WASHINGTON, Pa.–(BUSINESS WIRE)–Kulicke & Soffa Industries, Inc. (NASDAQ:KLIC – News) (“K&S”) today announced results for its first fiscal quarter ended January 2, 2010. For its first quarter, the Company reported net revenue of $128.4 million and net income of $15.8 million, or $0.21 per diluted share. This press release contains both GAAP results and non-GAAP measures.

On a non-GAAP basis* for the first quarter of fiscal 2010, the Company reported net revenue of $128.4 million and net income of $21.2 million, or $0.29 per diluted share.

Commenting on the results, Scott Kulicke, Chairman and Chief Executive Officer, said, “Results for our December quarter reflect the continuing strong semiconductor industry recovery, as well as our own efforts to expand our revenue base. Besides ball bonder demand driven by semiconductor unit volume growth, our revenue includes demand from the LED market and from the industry’s transition to copper wire bonding. In addition, we are seeing accelerating demand for our heavy wire wedge bonders. We expect these trends to continue through the March quarter, resulting in March quarter revenue in the range of $140 to $150 million.”

Key Product Trends

• Ball bonder unit volumes increased approximately 23% over the September quarter levels
  • Conversion to copper wire bonding continues to accelerate; total copper kit volumes increased 146% over the September quarter to approximately 1,550
  • Continued strong demand for ball bonders from the LED market
• Heavy wire wedge bonder demand accelerated late in the quarter and is expected to be strong at least through the March quarter
• First purchase order received for iStack_PS^TM die bonder in January 2010

Financial Highlights

• Gross Margin improved 119 basis points to 43.9%
• Return on Invested Capital^† of 35.4%
• Total cash and cash equivalents of $175.2 million as of January 2, 2010
• Net revenue for the March quarter of fiscal 2010 is expected to be $140 to $150 million

^†See Reconciliation of Return on Invested Capital table.

Earnings Conference Call Details

A conference call to discuss these results will be held today, February 4, 2010 beginning at 9:00 am (ET). To access the conference call, interested parties may call (877) 407-8037 or 201-689-8037, or log on to www.kns.com/investors/events for listen-only mode. A replay will be available approximately one hour after the completion of the call by calling toll-free (877) 660-6853 or internationally (201) 612-7415 and using the following replay access codes: 5521 (account number) and 342765 (replay ID number). A replay will also be available on the K&S website at www.kns.com/investors/events. The replay will be available via phone and website for a limited time.

Discussion of Non-GAAP Measures

This press release contains non-GAAP measures as a supplement to the consolidated financial results presented in accordance with GAAP. The Company believes certain non-GAAP measures provide investors with an additional, useful perspective on the Company’s performance as seen through the eyes of management. Management uses non-GAAP measures along with GAAP financial results for: analyzing the performance of the Company’s businesses; strategic and tactical decision making; and determining compensation. The Company does not consider non-GAAP measures to be a substitute for, or superior to, financial results presented in accordance with GAAP. All of the non-GAAP measures included herein are reconciled to the most directly comparable GAAP results in the following financial statements. These non-GAAP measures may be calculated differently from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on a comprehensive set of accounting rules or principles and some of the adjustments reflect the exclusion of items that are recurring and will be reflected in the Company’s GAAP financial results for the foreseeable future.

Exclusions from GAAP Results

The Company excludes the following from its GAAP results in presenting non-GAAP measures:

– Equity-based compensation expenses. The Company recognizes the fair value of its equity-based compensation in expenses. Equity-based compensation consists of common stock, stock options and performance-based and time-based restricted stock granted under the Company’s equity compensation plans. Equity-based compensation is a non-cash expense that can vary significantly in amount from period to period.

– Other. The exclusion of certain other non-GAAP amounts allows for improved comparisons of the Company’s results to both prior periods and other companies. The Company excludes the following other items from non-GAAP measures as these items are not reflective of the performance of the Company’s ongoing businesses:

• Severance plan
• Facilities contractual commitments
• Tax settlement expense
• Amortization of intangibles
• Gain on extinguishment of debt
• Non-cash interest expense
• Tax settlement benefit

– Tax Adjustment. Non-GAAP measures are tax adjusted using the GAAP tax rate associated with each quarterly period. The tax rate is calculated by dividing each quarter’s GAAP tax expense, adjusted for discrete quarterly items, by the GAAP operating income for that quarter. Non-GAAP year-to-date measures are calculated by summing the associated quarterly non-GAAP measures, without further tax adjustments.

Non-GAAP Measures

The specific non-GAAP measures included herein are gross profit, gross margin, net income (loss), net margin, and earnings per share (“EPS”). The Company calculates these measures as follows:

—Gross Profit. K&S non-GAAP gross profit excludes the effects of equity-based compensation expense recorded within cost of sales.

—Gross Margin. K&S non-GAAP gross margin excludes the impact of equity-based compensation expense recorded within cost of sales.

—Net Income (Loss) and EPS. K&S non-GAAP net income (loss) and EPS exclude equity-based compensation; severance; facilities contractual commitments; tax settlement expense; amortization of intangibles; gain on extinguishment of debt; non-cash interest expense; tax settlement benefit; and related tax effects on non-GAAP adjustments.

—Net Margin. K&S non-GAAP net margin reflects the Company’s net margin excluding equity-based compensation; severance; facilities contractual commitments; tax settlement expense; amortization of intangibles; gain on extinguishment of debt; non-cash interest expense; tax settlement benefit; and related tax effects on non-GAAP adjustments.

About Kulicke & Soffa

Kulicke & Soffa (NASDAQ: KLIC – News) is a global leader in the design and manufacture of semiconductor assembly equipment. As one of the pioneers of the industry, K&S has provided customers with market leading packaging solutions for decades. In recent years K&S has expanded its product offerings through strategic acquisitions, adding die bonding, wedge bonding and a broader range of expendable tools to its core ball bonding products. Combined with its extensive expertise in process technology, K&S is well positioned to help customers meet the challenges of assembling the next-generation semiconductor devices. (www.kns.com)

Caution Concerning Forward Looking Statements

In addition to historical statements, this press release contains statements relating to future events and our future results. These statements are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, and include, but are not limited to, statements that relate to increasing demand for ball bonders, the continuing semiconductor industry recovery, increasing demand for ball bonder products from the conversion to copper wire bonding and penetration of the LED market, continuing, accelerating demand for heavy wire wedge bonding products, future revenue, sales, demand for our products and product development. While these forward-looking statements represent our judgments and future expectations concerning our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to: difficult global economic conditions, which could result in, among other things, sharply lower demand for products containing semiconductors and for the Company’s products, and disruption of capital and credit markets; the risk of failure to successfully manage our operations; the risk of failure to successfully integrate Orthodyne; the risk that anticipated customer orders may not materialize or that orders received may be postponed or canceled, generally without charges; the volatility in the demand for semiconductors and our products and services; the risk that we may not be able to develop and manufacture new products and product enhancements on a timely and cost effective basis; acts of terrorism and violence; risks, such as changes in trade regulations, currency fluctuations, political instability and war, associated with a substantial foreign customer and supplier base and substantial foreign manufacturing operations; and the factors listed or discussed in Kulicke and Soffa Industries, Inc. 2009 Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission. Kulicke & Soffa Industries is under no obligation to (and expressly disclaims any obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

RiT Technologies (RITT) Reports Q4 and Full Year 2009 Results

TEL AVIV, Israel, February 4 /PRNewswire-FirstCall/ —

– After Challenging 2009, Company has Accelerated Sales Efforts & Concluded Reorganization and Cost-Cutting Plan

RiT Technologies (NASDAQ: RITT), today announced its financial results for the fourth quarter and full year ended December 31, 2009.

Revenues for the fourth quarter of 2009 were $2.2 million compared with $4.5 million for the fourth quarter of 2008. Net loss for the quarter was $(1.6) million, or $(0.61) per share (basic and diluted), compared with $(0.7) million, or $(0.28) per share (basic and diluted) in the fourth quarter of 2008.

For the twelve month period, revenues were $8.7 million compared with $22.6 million for 2008. Net loss for 2009 was $(6.5) million, or $(2.48) per share (basic and diluted), compared with $(1.2) million, or $(0.59) per share (basic and diluted) for 2008.

Reorganization and Cost-Cutting Plan

Since the end of the third quarter of 2009, RiT has implemented a company-wide reorganization and cost-cutting plan that will reduce the Company’s 2010 operating expenses by approximately $1.7 million compared with their level in 2009.

Comments of Management

“Our 2009 results reflect the recession that has dominated our target construction and financial verticals since late 2008, especially in the territories that are traditionally our strongest, such as Russia, the U.K. and North America,” commented Mr. Avi Kovarsky, RiT’s President & CEO. “In response to the reduced sales, we have accelerated our sales efforts and completed a comprehensive cost-cutting and reorganization program that will reduce our operating expenses by $1.7 million in 2010 as compared with 2009. At this expense level, and with the continued strong financing support of our controlling shareholder Stins Coman, we believe that we have the flexibility we need to pursue growth in step with the recovery of our markets.”

Mr. Kovarsky continued, “At the same time, two positive factors give us room for optimism as we look forward into 2010 and beyond. First, we continue to have a rich sales pipeline, which includes significant late-stage Carrier deals and high-potential Enterprise deals delayed from 2009. Second, we see significant potential in our new SiteWiz and EPV solutions, which expand our reach into the resilient small-to-medium-sized Enterprise segment. We are encouraged by the market reaction to these products and are very near to closing a significant SiteWiz deal. ”

Mr. Kovarsky concluded, “We are encouraged by the combination of these positive factors. With a lean expense structure, a rich sales pipeline, the right products and strong backing, we feel well positioned to achieve a turnaround and to deliver improved results in the year ahead.”

Conference Call Details

    The Company will host a conference call to discuss these results today,
Thursday, February 4th, at:
    10:00 a.m. Eastern Time
    9:00 a.m. Central Time
    8:00 a.m. Mountain Time
    7:00 a.m. Pacific Time
    17:00 Israel Time

To participate, please call one of the following teleconferencing numbers approximately 5-10 minutes prior to the scheduled start of the call:

1-888-407-2553 Toll free for US

+972-3-9180609 – International

To participate in the webcast of the call, please log-in about 5-10 minutes prior to the start of the call as follows: http://www.videonewswire.com/event.asp?id=65771.

For those unable to participate, the teleconference will be archived for replay for 14 days at the same url address, beginning 12 o’clock noon (EST) the day of the call. Note: Participants in the webcast may submit questions to be addressed in the conference call in advance by email to: simonag@rit.co.il, by phone: +972-3-766-4249 or fax: +972-3-647-4115.

About RiT Technologies

RiT is a leading provider of intelligent solutions for infrastructure management, asset management, environment and security, and network utilization. RiT Enterprise solutions address datacenters, communication rooms and workspace environments, ensuring maximum utilization, reliability, decreased downtime, physical security, automated deployment, asset tracking, and troubleshooting. RiT Environment and Security solutions enable companies to effectively control their datacenters, communications rooms and remote physical sites and facilities in real-time, comprehensively and accurately. RiT Carrier solutions provide carriers with the full array of network mapping, testing and bandwidth qualification capabilities needed for access network installation and service provisioning. RiT’s field-tested solutions are delivering value in thousands of installations for top-tier enterprises and operators throughout the world.

For more information, please visit our website: http://www.rittech.com

Safe Harbor Statement

In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words “believe,” “anticipate,” “expect,” “plan,” “intend,” “estimate”, “forecast”, “target”, “could” and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For example, when we discuss a field trial which could lead to a multi-million dollar Carrier deal, we are using a forward looking statement. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described under the heading “Risk Factors” in our most recent Annual Report filed with the Securities and Exchange Commission (SEC) on Form 20-F, which may be revised or supplemented in subsequent reports filed with the SEC. These factors include, but are not limited to, the following: our ability to raise additional financing, if required; the continued development of market trends in directions that benefit our sales; our ability to maintain and grow our revenues; our dependence upon independent distributors, representatives and strategic partners; our ability to develop new products and enhance our existing products; the availability of third-party components used in our products; the economic condition of our customers; the impact of government regulation; and the economic and political situation in Israel. We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.

                                                RiT TECHNOLOGIES LTD.
                                      CONSOLIDATED BALANCE SHEETS (U.S GAAP)
                                            (U.S dollars in thousands)

                                  December 31, 2009         December 31, 2008
    Assets                              (Unaudited)                (Audited)
    Current Assets
    Cash and cash equivalents                1,610                     6,111
    Trade receivables, net                   2,044                     3,737
    Other current assets                       462                       536
    Assets held for severance benefits         112                       -
    Inventories                              3,355                     3,978
                                             7,583                     14,362
    Long Term Assets
    Trade receivables, net                     181                       351
    Assets held for severance benefits       1,409                     1,579
                                             1,590                     1,930
    Property and Equipment
    Cost                                     3,252                     3,502
    Less - accumulated depreciation          2,870                     2,958
                                               382                       544

    Total Assets                             9,555                     16,836
    Liabilities and Shareholders' Equity
    Current Liabilities
    Short-term loan                            250                       -
    Trade payables                           1,322                     3,101
    Other payables and accrued expenses      1,340                     2,286
    Liability in respect of employees'
    severance benefits                         143                       -
                                             3,055                     5,387

    Other Liabilities
    Convertible loan from principal
    shareholder                              1,805                     -
    Liability in respect of employees'
     severance benefits                      1,633                     2,076
                                             3,438                     2,076
    Total Liabilities                        6,493                     7,463

    Shareholders' Equity
    Share capital                              559                       559
    Treasury stock                            (27)                      (27)
    Additional paid-in capital              36,820                    36,681
    Accumulated deficit                   (34,290)                  (27,840)
                                             3,062                     9,373
    Total Liabilities and
    Shareholders' Equity                     9,555                     16,836

                       RiT TECHNOLOGIES LTD.
                STATEMENTS OF OPERATIONS (U.S GAAP)

         (U.S dollars in thousands, except per share data)

                                         For the three       For the twelve
                                          months ended        months ended
                                          December 31,        December 31,
                                          (Unaudited)         (Unaudited)

                                        2009       2008       2009       2008
                                      U.S. $     U.S. $     U.S. $     U.S. $

    Sales                              2,214      4,538      8,655     22,556
    Cost of sales                      1,307      2,344      4,710     11,080
    Gross profit                         907      2,194      3,945     11,476

    Operating costs and expenses:
    Research and development:
    Research and development, gross      760        925      3,158      3,781
    Less - royalty-bearing
    participation                        206          -        206        104
    Research and development, net        554        925      2,952      3,677

    Sales and marketing                1,417      1,400      5,268      6,351
    General and administrative           521        556      2,065      2,718
    Total operating expenses           2,492      2,881     10,285     12,746
    Operating loss                   (1,585)      (687)    (6,340)    (1,270)
    Financial income (loss), net         (7)       (39)      (110)         52
    Net Loss                         (1,592)      (726)    (6,450)    (1,218)

    Net loss per ordinary share
    (basic and diluted)               (0.61)     (0.28)     (2.48)     (0.59)

    Weighted average number of
    ordinary shares, used to
    compute net Loss per ordinary
    share (basic and diluted)      2,604,428  2,604,428  2,604,428  2,060,697

MOD-PAC CORP. (MPAC) Earnings per Share Increases 800%

BUFFALO, N.Y.–(BUSINESS WIRE)–MOD-PAC CORP. (NASDAQ: MPAC – News), a manufacturer of custom and stock paper board packaging and personalized print products, today reported total revenue of $12.77 million in the fourth quarter of 2009, which ended December 31, 2009, down 6.2% compared with revenue of $13.62 million in the 2008 fourth quarter. Excluding 2008 fourth quarter specialty print and direct mail sales which was rationalized in the second quarter of 2009, total revenue grew $139 thousand, or 1.1%, compared with the 2008 fourth quarter. Solid 6% sales growth in the custom folding carton line was mostly offset by reduced sales in the stock packaging and personalized print lines which have been impacted by the weak economy.

Net income for the fourth quarter of 2009 was $1.26 million, or $0.36 per diluted share, a significant increase when compared with net income of $129 thousand, or $0.04 per diluted share, in the fourth quarter of 2008. Net income growth reflects the effectiveness of the product line rationalization which eliminated unprofitable business combined with improved productivity and cost reductions.

For the full year 2009, total revenue was relatively unchanged at $48.9 million as 13.7% growth in custom folding cartons offset the impact of six months less sales from the specialty print and direct mail product line and the decline in stock packaging and personalized print sales. Excluding 2009 and 2008 specialty print and direct mail sales, total revenue was $47.4 million for 2009, up $2.7 million, or 6.0%, when compared with $44.7 million for 2008. GAAP net loss for the year was $2.0 million, or $0.58 per diluted share. Excluding $2.0 million in onetime charges associated with the product line rationalization and the write-down of impaired assets, net income would have been $12 thousand, or $0.00 per diluted share. (See reconciliation of GAAP net income (loss) and earnings (loss) per share to adjusted net income (loss) and earnings (loss) per share in the attached table.)

Fourth Quarter 2009 Sales Review:

• Sales of folding cartons, which include custom folding cartons and stock packaging, were up 2.5%, or $0.29 million, to $12.03 million in the 2009 fourth quarter from $11.74 million in the prior year fourth quarter. Custom folding carton sales drove the product line increase.
• Custom folding carton sales for the fourth quarter of 2009 were $8.96 million, up $0.51 million, or 6.0%, from 2008 fourth quarter sales of $8.46 million. Sales growth was driven by continued sales growth with existing customers, particularly those that provide private label branded products.
• Stock packaging sales were $3.07 million in the 2009 fourth quarter, a decline of $0.22 million, or 6.6%, from $3.28 million the prior year period. The stock packaging line has been impacted by economic conditions over the last year.
• Print service sales, which are now solely comprised of personalized print, were down
  $1.15 million, or 65.9%, to $0.60 million in the 2009 fourth quarter compared with $1.75 million in the same period in 2008. Of the decline, $0.99 million was related to sales in the prior year’s fourth quarter for specialty print and direct mail. Personalized print sales declined
  $165 thousand, or 21.6%, to $0.60 million in the fourth quarter of 2009 compared with sales of $0.76 million in last year’s fourth quarter. The decrease was primarily due to current economic conditions.

Mr. Daniel G. Keane, President and CEO of MOD-PAC CORP., commented, “The rationalization of the specialty print and direct mail product line has enabled us to focus our resources on expanding our custom folding carton business. We believe our ability to provide on demand short runs of customized cartons for our customers is a cost effective means for them to address their customers changing requirements.”

Fourth Quarter Operating Results: Cost discipline and product line rationalization drove margin expansion

Gross profit for the 2009 fourth quarter was $2.98 million, or 23.4% of total revenue, compared with gross profit of $2.12 million, or 15.6% of total revenue, in the same period the prior year. The improvement in gross profit and margin was driven by the savings realized from the product line rationalization as the Company realized lower depreciation expense and decreased labor and supply costs. Also contributing to the improved margin was lower freight and utility costs and improvements in productivity.

Selling, general and administrative (SG&A) expense was down $126 thousand, or 6.7%, to $1.75 million, or 13.7% of total revenue, in the fourth quarter of 2009 when compared with $1.88 million, or 13.8% of total revenue, in the same period the prior year. The decrease was due to lower wages from the product line rationalization, reduced professional service fees, and lower bad debt expense.

Mr. David B. Lupp, Chief Operating Officer and Chief Financial Officer commented, “Having rationalized product lines and increased our focus on our core products, we are now driving a leaner, more productive operation. We have made several operational improvements that have increased our productivity enabling us to strengthen our earnings power. We believe that we can continue to build efficiencies and grow sales by targeting customers that value our quality, speed and value-based pricing.”

Adjusted earnings before interest, asset impairment, taxes, depreciation and amortization, and non-cash option expense (Adjusted EBITDA) was $2.03 million in the fourth quarter of 2009 compared with $1.23 million in the 2008 fourth quarter. The Company believes that, when used in conjunction with GAAP measures, Adjusted EBITDA, which is a non-GAAP measure, helps in the understanding of operating performance. (See the reconciliation of Net Income (loss) to Adjusted EBITDA in the attached table.)

As required by generally accepted accounting principles, in the second quarter of 2009 the Company recorded a full valuation allowance on its net deferred tax asset due to the uncertainty with respect to utilizing it in the future based on a past trend of operating losses. As a result, the effective tax rate for the fourth quarter of 2009 was 0%, compared with 43.2% for the fourth quarter of 2008. The Company has approximately $0.64 million in net operating loss carry forwards that can be applied to future income.

Liquidity: Asset sales and strong cash generation from operations increased cash on hand

Cash and cash equivalents were $3.78 million at December 31, 2009, a substantial increase compared with $0.32 million at October 3, 2009 and $0.20 million at December 31, 2008. MOD-PAC generated $2.26 million in cash from operations during the quarter from higher net income, higher non-cash depreciation and amortization expense, and decreased working capital requirements. Also, in the fourth quarter of 2009, the Company sold its Blasdell, NY facility for net proceeds of $1.4 million and assets related to the specialty print and direct mail rationalization for approximately $0.6 million.

Capital expenditures in the fourth quarter and full year of 2009 were $0.13 million and $0.98 million, respectively, compared with $0.39 million and $2.0 million, in the same periods the prior year. Capital spending was focused on equipment and system improvements. Approximately half of the capital expenditures in 2008 were for productivity and efficiency initiatives that provided a benefit to the organization in 2009. Capital expenditures are expected to be approximately $1.2 million in fiscal year 2010. Depreciation and amortization was $3.19 million in 2009 compared with $3.74 million in 2008. Lower depreciation primarily reflects a reduced asset base from the write-down of assets associated with the rationalized product line in the second quarter of 2009.

MOD-PAC has access to a $5.0 million committed line of credit with a commercial bank, which expires in March 2010. The line of credit was paid off in full in the fourth quarter of 2009, a decrease of $0.6 million from the October 3, 2009 balance, and $1.0 million from the December 31, 2008 balance. An additional $0.2 million of the line of credit was in use through standby letters of credit. The Company is currently in negotiations with several financial organizations regarding a new line of credit.

There were no shares repurchased by the Company in 2009. MOD-PAC has authorization to repurchase 75,885 shares.

Year-End Review: 13.7% growth in custom folding carton sales; Excluding one time charges achieves breakeven on flat sales

Total revenue for 2009 was flat with 2008 at $48.90 million. Net sales, excluding rent, for the same period was down slightly to $48.35 million, compared with $48.41 million in 2008. New customers and gaining additional business from existing customers drove the 13.7% growth in custom folding carton sales to $34.85 million compared with $30.65 million in the prior year. Economic conditions continued to negatively impact stock packaging and personalized print sales, which were down 7.4% to $8.95 million, and 22.4% to $3.03 million, respectively, in 2009 when compared with 2008 results.

In 2008, specialty print and direct mail had $4.19 million in sales. This product line had $1.52 million in sales during the first half of 2009.

Gross profit for 2009 was $7.38 million, or 15.1% of total revenue, up $0.65 million, or 9.7%, from gross profit of $6.72 million, or 13.8% of total revenue, in 2008. Increases in gross profit dollars and margin expansion reflect the effectiveness of rationalizing product lines and eliminating losses associated with specialty print and direct mail as well as process improvements that are driving productivity gains.

SG&A expense in 2009 decreased 4.1% to $7.55 million, or 15.4% of total revenue, compared with $7.87 million, or 16.1% of total revenue, in 2008. The decrease was due to lower professional service fees, reduced advertising, and lower bad debt expense, slightly offset by higher commission and depreciation expense.

Included in the 2009 results was $1.8 million of expense that was associated with the write-down of impaired assets due to the Company’s rationalization of the specialty print and direct mail product line.

Adjusted EBITDA for 2009 was up to $3.51 million compared with $2.99 million in 2008. (See the reconciliation of Net Income (loss) to Adjusted EBITDA in the attached table.)

Mr. Lupp concluded, “We have successfully completed the turn around of our operations that provides a solid platform from which we can grow. Our strategy is to continue to further penetrate the custom folding carton market, specifically in the niche applications where our rapid turn around, high quality carton design, and responsive service address the unique needs of our customers that serve a broad variety of customers needing smaller print quantities. We are also evaluating opportunities to expand the markets served with our personalized print and stock packaging products while focusing our products and services to improve efficiencies.”

Webcast and Conference Call

The release of the financial results will be followed today by a company-hosted teleconference and webcast at 1:30 p.m. Eastern Time. During the teleconference, Daniel G. Keane, President and Chief Executive Officer, and David B. Lupp, Chief Operating Officer and Chief Financial Officer, will review the financial and operating results for the period and discuss MOD-PAC CORP.’s corporate strategy and outlook. A question-and-answer session will follow.

The MOD-PAC conference call can be accessed the following ways:

• The live webcast can be found at http://www.modpac.com. Participants should go to the website 10 – 15 minutes prior to the scheduled conference in order to register and download any necessary audio software.
• The teleconference can be accessed by dialing (201) 689-8562 and requesting Conference ID Number 340781 approximately 5 – 10 minutes prior to the call.

The archived webcast will be at http://www.modpac.com. A transcript will also be posted once available. A replay can also be heard by calling (201) 612-7415 and entering conference ID number 340781 and account number 3055. The telephonic replay will be available from 4:30 p.m. Eastern Time the day of the teleconference through 11:59 p.m. Eastern Time on February 11, 2010.

ABOUT MOD-PAC CORP.

MOD-PAC CORP. is a high value-added, on demand print services firm providing products and services in two product categories: folding cartons and personalized print. Within folding cartons, MOD-PAC provides CUSTOM FOLDING CARTONS for branded and private label consumer products in the food and food service, healthcare, medical and automotive industries. The Company also offers a line of STOCK PACKAGING primarily to the retail confectionary industry. MOD-PAC’s PERSONALIZED PRINT product line is a comprehensive offering for consumer and corporate social occasions.

MOD-PAC’s strategy for growth is to leverage its capabilities to innovate and aggressively integrate technology into its production operations providing cost-effective solutions for its customers. Through its large, centralized facility, the Company has captured significant economies of scale by channeling large numbers of small-to-medium-sized orders through its operations due to its rapid order change out skills. Applying its lean manufacturing processes coupled with state-of-the-art printing technologies, MOD-PAC is able to address short-run, highly variable content needs of its customers with quick turn around times relative to industry standards.

Additional information on MOD-PAC can be found at its website: http://www.modpac.com.

Safe Harbor Statement: This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. One can identify these forward-looking statements by the use of the words such as “expect,” “anticipate,” “plan,” “may,” “will,” “estimate” or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors, which could cause actual results to differ materially, include market events, competitive pressures, changes in technology, customers preferences and choices, success at entering new markets, the execution of its strategy, marketing and sales plans, the rate of growth of internet related sales, the effectiveness of agreements with print distributors and other factors which are described in MOD-PAC’s annual report on Form 10K on file with the Securities and Exchange Commission. The Company assumes no obligation to update forward-looking information in this press release whether to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial conditions or prospects, or otherwise.

FINANCIAL TABLES FOLLOW.