EX-99.1

ALISO VIEJO, Calif.—February 3, 2005—RemedyTemp, Inc. (NASDAQ:REMX), which operates as Remedy Intelligent Staffing® and RemX® Specialty Staffing, today reported strong first fiscal quarter financial results, reflecting increased demand for temporary workers, along with the benefits of internal programs focused on increasing revenue and enhancing margins.

For the fiscal 2005 first quarter ended January 2, 2005, revenue advanced 9% to $137.4 million from $126.0 million in the corresponding period last year. The company registered pre-tax profits of $15,000 for the 2005 first quarter, versus a loss of $3.2 million last year. RemedyTemp reduced its net loss for the fiscal 2005 first quarter to $22,000, less than $0.01 per share, representing a sharp improvement over the net loss of $3.3 million, or $0.37 per share, a year ago.

“The programs we have put into place over the past two years are beginning to pay off, and at the same time, conditions in the markets we serve appear to be strengthening,” said Greg Palmer, president and chief executive officer. “Our commercial divisions and our RemX® Specialty Staffing unit performed well during the quarter, with RemX achieving operating profitability for the first time since being established approximately three years ago.

“The planned, accelerated growth of RemX and a 99% increase in revenue by our direct hire operation during the first quarter, combined to produce a positive shift in our business mix,” Palmer said. “Accordingly, we were pleased to achieve a 31% increase in gross margin dollars and an improvement in gross margin of 3.2 percentage points to 19.5% from 16.3% last year.”

RemedyTemp further strengthened its balance sheet during the first quarter. Its restricted cash portion was reduced to approximately $25 million from $41.1 million at year end, reflecting a new $50 million credit facility arranged with its existing bank, Bank of America, which released $16.0 million of previously restricted cash. At January 2, 2005, the company had $45.7 million in total cash and investments. RemedyTemp continues to have no debt.

Palmer said the second fiscal quarter is seasonally the company’s weakest, but he believes results will be improved over the prior year. He said revenue is anticipated to advance 8% to 11% for the second fiscal quarter ending April 3, 2005, over the $115.4 million reported for the second quarter of fiscal 2004. The company expects its pre-tax loss will be reduced to approximately $2.4 million to $2.9 million, compared with a pre-tax loss of $3.8 million in the corresponding prior year period.

RemedyTemp, with 237 offices throughout North America, is a professional staffing organization focused on delivering human capital workforce solutions in various business sectors. For additional information about RemedyTemp visit www.remedytemp.com.

This news release contains forward-looking statements that involve material risks and uncertainties. Such forward-looking statements, including, but not limited to growth and strategies, future operating and financial results, financial expectations for the second quarter of fiscal 2005 and current business indicators, are subject to change based on factors beyond the control of the company. (Certain of such statements are identified by the use of words such as “anticipate,” “believe,” “estimate,” “intend,” “plan,” “expect,” “will,” or “future”).

Accordingly, the company’s actual results may differ materially from those expressed or implied in any such forward-looking statements as a result of various additional factors, including, without limitation, the continued performance of the RemX® Specialty Staffing division, the company’s ability to realize improvements in the

months ahead, changes in general or local economic conditions that could impact the company’s expected financial results, the availability of sufficient personnel, various
costs relating to temporary workers and personnel including but not limited to workers’ compensation and state unemployment rates, the company’s ability to expand its sales capacity and channels, to open new points of distribution and expand in core geographic markets, attract and retain clients and franchisees/licensees, the outcome of litigation,
software integration and implementation, and other factors described in the company’s filings with the Securities and Exchange Commission regarding risks affecting the company’s financial condition and results of operations. The company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any such forward-looking statement or any projected results expressed or implied therein will not be realized.

The following table sets forth summary statements of operations and condensed balance sheets and should be read in conjunction with this news release.

REMEDYTEMP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share amounts)


	(unaudited)
	Three Months Ended
	January 2,			December 28,
	2005			2003
Total revenues	$	137,356		$	126,011
Cost of revenue		110,565			105,521
Licensees’ share of gross profit		6,468			5,817
Selling and administrative expenses		19,348			16,292
CIGA litigation		98			150
Depreciation and amortization		1,364			1,748

Loss from operations		(487	)		(3,517	)
Other income (expense):
Interest expense		(128	)		(127	)
Interest income		259			258
Other, net		371			194

Income (loss) before income taxes		15			(3,192	)
Provision for income taxes		37			124

Net loss	$	(22	)	$	(3,316	)

Net loss per share: basic and diluted	$	(0.00	)	$	(0.37	)

Weighted average shares: basic and diluted		9,033			9,019


	(unaudited)
	January 2,		October 3,
	2005		2004
ASSETS
Current assets:
Cash and investments	$	20,226	$	7,414
Restricted investments		3,505		19,161
Accounts receivable, net		61,147		63,152
Other current assets		7,694		9,073

Total current assets		92,572		98,800
Fixed assets, net		10,230		10,589
Restricted cash and investments		21,919		21,925
Other assets		6,530		6,307

Total Assets	$	131,251	$	137,621

LIABILITIES AND SHAREHOLDERS’ EQUITY
Total current liabilities	$	34,870	$	43,843
Total long-term liabilities		32,565		30,267

Total liabilities		67,435		74,110
Total shareholders’ equity		63,816		63,511

Total Liabilities and Shareholders’ Equity	$	131,251		137,621


News Release		FOR:		REMEDYTEMP, INC.