Barrett Business Services, Inc. took a huge hit in its stock price Wednesday following its release of third-quarter earnings showing a net loss of $37.7 million, largely due to an $80 million increase in reserves for payments of drawn-out worker compensation claims.
The Vancouver-based provider of employment services to small and midsized companies saw its stock price slump by nearly 60 percent, to $18.28 per share at closing. The stock sell-off accelerated over the course of the day. Before Wednesday, its stock price ranged over 52 weeks from a low of $28.55 to a peak of $102.20 per share.
The company provides what are called “professional employer organization” services. Under the system, Barrett becomes a co-employer of a client’s workforce, handling human resources responsibilities, including workers’ compensation claims. Its national client base includes companies in a variety of industries, including telecommunications, transportation and shipping, manufacturing and food processing.
The company said net revenues increased by 18 percent, to $175 million, during the quarter. Barrett added 182 new clients in the quarter, and its same-store sales increased by 8.2 percent, which was at the upper end of its expectations, the company said it its earnings report.