Staffing 360 Solutions Reiterates Commitment to Growth and Acquisition Strategy in Letter to Shareholders

NEW YORK, NY--(Marketwired - November 02, 2016) - Staffing 360 Solutions, Inc. (NASDAQ: STAF), a public company executing a global buy-and-build strategy through the acquisition of staffing organizations in the US and UK, today released a letter from Brendan Flood, Executive Chairman, that reiterates the Company's commitment to growth and provides shareholders with an update on current market activity and insight into management's expectations.

Dear Shareholders:

As the Executive Chairman of Staffing 360 Solutions, I wanted to take this time to discuss the Company's recent market activity, as well as how this may relate to our listing on the Nasdaq Capital Market and our future growth initiatives.

As I'm sure all of you are aware, Staffing 360 Solutions dipped below $1.00 per share for the first time this past week and has traded below 70 cents per share since then. We recognize that $1.00 per share is a major threshold, not only for investors, but also for the Nasdaq exchange itself, as companies can eventually be delisted for trading below this threshold after an extended period of time, as discussed in more detail below.

However, before we get into the details, let me be perfectly clear -- we have absolutely no expectation for our share price to remain at these levels in the long term. We are committed to improving our balance sheet and growing the company both organically and through acquisitions until we reach our publicly stated goals of surpassing $300 million in revenue. I have 100% confidence in our management team and the hundreds of employees at Staffing 360 Solutions that are tirelessly driving our business forward and enhancing our growth potential.

Let us not forget that over the past three years we have acquired 6 companies, including Lighthouse Placement Services and The JM Group in fiscal 2016, and our goal is to continue to acquire businesses until we reach our strategic target of $300 million in annualized revenues. At this stage we are already at a current revenue run rate of $190 million, with strong double digit organic growth and Adjusted EBITDA of $5.3 million over the trailing twelve months. As mentioned on our recent quarterly conference calls, we are reviewing and working on some acquisitions of considerable size, including some that could help us surpass our $300 million revenue goal in one fell swoop.

I know that dilution is a topic at the top of any investor's mind and our shares outstanding have increased over the last few months from capital raises, as well as debt conversions as part of our balance sheet improvements. For example, we raised $5.3 million in equity through our S-3 Registration Statement since April of this year, and a large part of the proceeds was used to improve our balance sheet. We also recently converted $980,000 of debt into shares of common stock at a price of $1.10 per share.

Although we would prefer to avoid any dilution wherever possible, please rest assured that I am particularly focused on Staffing 360's execution, both operationally as well as its capital structure, and issuances of shares are strategically evaluated to be in the best interests of the Company and our shareholders. This is especially true for me, as I am one of the largest shareholders of the Company, and have a vested interest in seeing the company succeed with as little dilution as possible.

With regard to Nasdaq, first, let's understand the process and the timeline we are dealing with, as there is significant cushion built into the process. First, we would need to see the consolidated closing bid price remain below $1.00 per a share for at least 30 consecutive trading days before a deficiency letter is sent by Nasdaq, and at that point an additional 180 calendar days are provided to regain compliance. If at any time during this 180-day period the closing bid price is at least $1.00 for a minimum of 10 consecutive trading days, Nasdaq will typically provide written confirmation of compliance and matter will be closed. However, Nasdaq may require the closing bid price to be equal to or exceed the $1.00 minimum bid price requirement for more than 10 consecutive business days before determining that a company complies. In addition, other remedies, such as an appeal for additional time, or a reverse split, may also be available.

Needless to say, this is a significant timeframe, and one in which we strongly believe additional progress on our balance sheet and additional announcements regarding future acquisitions will take place.

Despite our currently low share price, we are very pleased with where we are on our development plan from an operational perspective, as we continue to grow organically, month after month, and quarter after quarter. We commend each and every one of our employees for the positive improvements that they deliver on a daily basis.

We experienced over 14% organic growth from the Company's existing staffing divisions in fiscal Q1 2017. We have achieved our largest quarterly revenue and gross profit figures in the history of Staffing 360 Solutions in the same time frame. In addition, our employees have done an incredible job supporting the growth of the business. We now have over 4,000 temporary workers across all subsidiaries at any given time.

Some of our milestones bear repeating, so here are just a few of the ones that have been achieved over the last 12 months:

Financial Results and Organic Growth:

• We grew revenues to $47.8 million in Q1 2017, the single largest quarterly revenue in the Company's history;
• Our run-rate is now in excess of $190 million, close to two-thirds of our stated mission of reaching $300 million in revenue;
• Our underlying operations demonstrated strong 14% organic revenue growth in Q1 2017, year-over-year;
• Our net loss decreased to $1.3 million in Q1 2017, compared to a net loss of $1.7 million in the same period of last year;
• Realized Adjusted EBITDA of $1.8 million in Q1 2017, and $5.3 million on a TTM basis, which is the highest level ever and 200% greater than last year.

At these levels, we have conviction that Staffing 360 Solutions represents a tremendous value, not only today, but across a long term horizon. As we continue to implement Staffing 360's M&A strategy, we remain committed to our vision, committed to our employees, and committed to our loyal shareholders.

I thank you for your attention and continued support. For further information, please visit the "Investors" section of our website at: www.staffing360solutions.com/investors.html.

Respectfully,

Brendan Flood
Executive Chairman
Staffing 360 Solutions, Inc.
Ticker: STAF

About Staffing 360 Solutions, Inc.

Staffing 360 Solutions, Inc. (NASDAQ: STAF) is a public company in the staffing sector engaged in the execution of a global buy-and-build strategy through the acquisition of domestic and international staffing organizations in the US and the UK. The Company believes the staffing industry offers opportunities for accretive acquisitions that could drive its annual revenues to $300 million. As part of its targeted consolidation model, the Company is pursuing acquisition targets in the finance and accounting, administrative, engineering and IT staffing space. For more information, please visit: www.staffing360solutions.com.

Follow Staffing 360 Solutions on Facebook, LinkedIn and Twitter.

Non-GAAP Financial Measures

The Company uses financial measures which are not calculated and presented in accordance with US generally accepted accounting principles ("GAAP") in evaluating its financial and operational decision making regarding potential acquisitions and presenting the operating and financial performance of the Company, as well as a means to evaluate period-to period comparison. The Company presents these non-GAAP financial measures because it believes them to be an important supplemental measure of performance that is commonly used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We refer you to the reconciliations below.

The Company defines Adjusted EBITDA as earnings (or loss) from continuing operations before interest expense, income taxes, depreciation and amortization, and amortization of non-cash stock-based compensation, non-recurring acquisition and restructuring expenses and goodwill impairment charges.

Forward-Looking Statements

Certain matters discussed within this letter to shareholders are forward-looking statements including, but not limited to our future share price, our financial and operating performance, our continued listing status, the availability of any remedies, the timing and ability to enter into any additional acquisitions and expand our business, as well as the size of future revenue or trading volume or future access to capital markets. Staffing 360 Solutions, Inc. can give no assurance with respect to these or other forward-looking statements. For example, in order for the Company to achieve annualized revenues of $300 million, the Company will need to successfully raise sufficient capital, to identify and consummate additional target acquisitions, successfully integrate any newly acquired companies, organically grow its business, successfully defend any potential future litigation, as well as various additional contingencies, many of which are unknown at this time and generally out of the Company's control. Our historic acquisitions provide no guarantee with respect to the consummation of future acquisitions. Achieving annualized revenues of $300 million, or any other amount, does not guarantee that our share price will increase. Our continued listing status is also dependent on many factors in addition to our share price, including, for example, our compliance with Nasdaq's other continued listing standards and discretionary decisions within Nasdaq's authority. The Company can give no assurance that it will be able to achieve the objectives discussed herein. Staffing 360 Solutions does not undertake any duty to update any statements contained herein (including any forward-looking statements), except as required by law. Factors that could cause actual results to differ materially from expectations include general industry considerations, regulatory changes, changes in local or national economic conditions, our ability to access the capital markets on terms acceptable to us, or at all, our ability to identify and consummate acquisitions, our ability to comply with our contractual covenants, including in respect of our debt, our ability to comply or bring the Company into compliance with Nasdaq's continued listing standards and other risks, including those detailed from time to time in Staffing 360 Solutions' reports filed with the SEC, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K.

* During the fourth quarter of fiscal 2016, the Company reclassified certain banking fees, previously reported within Loss from Operations, to Interest Expense for all quarters during the fiscal 2016 year. Adjusted EBITDA has changed as a result, based on these historical adjustments.

** Contains amortization included within Other Income / (Expenses).

Image Available: http://www.marketwire.com/library/MwGo/2016/11/1/11G120487/Images/Brendan_Flood_-_Preferred_Pic_2-d388c978a6ec889cbf271ab91e03eded.jpg