Roth Capital Partners

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• Roth Capital Partners
• 19th Annual OC Conference
• February 21, 2007

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Changing the way America worksthrough
innovative human resource management
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Forward Looking Statements

• The issues addressed in this presentation may
  involve forward-looking statements which, along
  with other information presented that are not
  historical facts, are subject to a number of
  risks and uncertainties. Actual results may
  differ materially. Please refer to our 2005
  Annual Report on Form 10-K and to our other SEC
  filings for more information about the risks and
  uncertainties that could cause actual results to
  differ.

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Our Mission
GOOD PEOPLE, GOOD COMPANIES GREAT RESULTS!
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Key Investment Highlights

• Leading provider of HR management services
• Well-respected service provider in large,
  underserved market
• Focused on small and medium-sized businesses
• Scalable, substantial operating leverage
• Positioned for growth opportunities
• Pipeline of new business for organic growth
• Financial capacity to seek strategic acquisition
  opportunities
• ASO (Administrative Services Organization)
• Highly predictable and recurring revenue stream
• PEO contracts are annual with automatic renewals
  (30-day cancellation)
• PEO client retention rate is very high
• Strong value proposition in current market
  conditions
• Experienced management team

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Overview of BBSI

• Target Client 20 to 200 employees per
  business
• Service Delivery 38 branch offices (10
  states) 325 management
• employees
• Sales Model Talented sales people,
  referrals from customers, insurance
  brokers, financial planners, CPAs, etc.
• EPS 1Q 06 0.12 (up 20 vs.
  1Q05 net inc. up 45.8) 2Q 06 0.36 (up 16
  vs. 2Q05 net inc. up 44.2)
• 3Q 06 0.48 (up 20 vs. 3Q05 net inc. up
  28.2)
• 4Q 06 0.45 (up 22 vs. 4Q05 net inc. up
  21.2)
• 2006 1.40 (up 16 vs. 2005 net inc. up
  30.8)
• 2005 and 2006 include the effect of an additional
  2.185 million shares outstanding in
• August 2005.

(1)
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Average Weekly Revenues 2003-2006
( in millions)
2003
2004
2005
2006
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BBSI Solves HR Problems
Benefit Programs
Work Comp Premiums
Competitive
Employee Retention
Employee Turnover
Save 25-30
Future Cost Protection
Cost Effective
Recruiting
Drug Testing
Screening
Workplace Safety
Discrimination Wrongful Term. Harassment Suits
Risk Mgmt
Claims Mgmt
Policies Procedures
Drug Testing
Proactive Training
Coaching Counseling
Qualified Employees
Regulatory Filings
Search
Compensation Advice
Full Compliance
Proper Hiring Procedures
Interview
Timely Tax Payments
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HR Responsibilities WITHOUT BBSI
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HR Responsibilities WITH BBSI
PEO Clients Are Able to Outsource Their HR
Functions
Report Incidents to BBSI
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HR Function is Becoming More Critical

• According to the U.S. Small Business
  Administration (SBA), between 1980 and 2000, the
  number of U.S. laws and regulations regarding
  employment policies and practices grew by about
  60 percent
• Small and medium sized businesses lack internal
  resources to manage their human capital needs
• Proprietors of small or midsized businesses now
  spend up to 25 of their time on
  employment-related paperwork

BBSIs Pro HR approach enables clients to focus
on their core competencies
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PEO Industry Overview

• The PEO industry generates approximately 60
  billion in gross revenues annually
• There are about 700 PEOs that offer a wide array
  of employment services and benefits operating in
  50 states
• According to independent research conducted by
  the Society of Human Resource Management (SHRM)
  Foundation in May 2002, PEOs allow small to
  mid-sized business clients to "reduce costs and
  free up time to devote to revenue generating
  activities, improvements that can be instrumental
  to gaining competitive advantage"

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Projected 2006 Staffing Industry
60 billion (gross)
90 billion
22 billion
1 billion
Source Staffing Industry Report
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Geographic Footprint
38 Branch Offices in 10 states
MD 2 DE 1 NC 1
CA 15 OR 9 WA 4 ID 3 AZ 1 UT 1 CO 1

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Growth Strategy

• Support, strengthen and expand branch office
  operations
• Increase client utilization of our services
• Cross selling between staffing and PEO
• MIS
• Customer customization
• Seamless integration
• Penetrate new markets
• Expand our geographic presence following our
  current customers expansion
• Pursue strategic acquisitions
• Pro HR 1/1/06

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Operating Strategy

• Broad scope of services
• Decentralized operations
• Customers are within 50 mile radius of branch
  location
• Hands-on with our customers with both risk
  management and human resource professionals
• Economic incentives for employees on financial
  performance goals

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Experienced Management Team
Name and Title
Years of Industry Experience
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Financial Themes

• Strong Top-Line Growth
• Diversified revenue stream from PEO, staffing
  services and permanent placement
• Predictable, recurring revenue stream from PEO
• Continue to develop new markets
• Focus on Profitability
• Optimization of processes
• Strong Balance Sheet
• No bank debt
• Current ratio 2.4 to 1
• 6.53 per share in cash and securities

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Highlights of 2006

• Completed acquisition of Pro HR
• Continued strong growth in gross revenues
• - Record 1.04 billion
• gt Up 35.9 over 2005
• EPS of 1.40 vs. 1.21 (2005)
• Net income of 16.3 million up 30.8 over 2005
• Cash securities 73.4 million at 12/31/06
• Formed ASO division
• Formed captive insurance subsidiary

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Annual Gross Revenues ( in millions)

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Quarterly Gross Revenues ( in millions)
Estimated increase of 12
273.8
260 to 265
235.3
213.1
212.1
183.6
Est.
2004
2005
2007
2006
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Quarterly Net Income ( in millions)
5.56m
5.23m
4.34m
4.19m
Estimated increase of 21
2.45m
1.64m
1.36m
Est.
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Quarterly EPS
0.48
0.45
0.40
0.36
2.185 mm additional shares o/s August 2005
0.26
0.13 to 0.15
0.12
Est.
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Key Balance Sheet Items
( in millions)
12/31/05
12/31/06

Cash and equivalents
61.4


69.9 3.6 162.2
Marketable securities
3.9


Workers compensation claims



9.1 7.5 -- 103.7 162.2
14.3 7.7 1.4 85.9 144.3


Safety incentives
Long-term debt

Stockholders' equity
 
 
 
Total Liabilities and Equity
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Key Investment Highlights

• Leading provider of HR management services
• Well-respected service provider in large,
  underserved market
• Focused on small and medium-sized businesses
• Scalable, substantial operating leverage
• Positioned for growth opportunities
• Pipeline of new business for organic growth
• Financial capacity to seek strategic acquisition
  opportunities
• ASO
• Highly predictable and recurring revenue stream
• PEO contracts are annual with automatic renewals
  (30-day cancellation)
• PEO contract retention rate is very high
• Strong value proposition in current market
  conditions
• Experienced management team

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• Roth Capital Partners
• 19th Annual OC Conference
• February 21, 2007