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Olsten CEO steps down
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February 11, 1999: 2:04 p.m. ET
Home healthcare, staffing company posts nearly 50% drop in 4Q, top exec quits
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NEW YORK (CNNfn) - The top executive of Olsten Corp., the staffing services and home healthcare company that posted a staggering drop in fourth-quarter earnings Thursday, is stepping down.
Frank N. Liguori, 52, announced his resignation as chairman and chief executive officer Thursday after 28 years with the company, giving no explanation.
He will be replaced by Edward A. Blechschmidt, Olsten's president and chief operating officer, who will take on the added title of chief executive officer. The company's Vice Chairman Stuart Olsten will become chairman.
Olsten reported earning $12 million, or 15 cents a share, in the fourth quarter ended Jan. 3, down from profits of $23 million, or 29 cents a share, in the year-ago quarter.
The company still managed to meet Wall Street estimates, according to First Call.
Revenue grew 16 percent to $1.3 billion, largely through acquisitions and by growth in European Staffing, Information Technology and Home Infusion.
Those gains, however, were offset by lower revenue in Olsten's nursing business due to lower Medicare reimbursements, and to flat demand and "recruiting challenges" in North American Staffing, the company said.
"Our team is not satisfied with fourth-quarter and 1998 earnings performance," Blechschmidt said. "However, looking ahead, we are determined to address our profitability issues in both the Health Services and Staffing Services businesses."
For the year, revenue rose 12 percent to $4.6 billion.
But net income fell to $45 million, or 55 cents per share, excluding adjustments and one-time charges, from $93 million, or $1.15 per share, for fiscal 1997.
Wall Street reacted favorably to the news.
Shares of Olsten (OLS) rose 5/8 to 7-7/8, nearly a 9 percent gain. The company's stock has fallen steadily, however, from a 52-week high of around 17-5/8 in March. 
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Olsten.com
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