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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

|           |  |                                                                                                                                 
|---------- |  | --------------------------------------------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                                                                 
|           |  |                                                                                                                                 
|[X]        |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001
|           |  |                                                                                                                                 
|OR         |  |                                                                                                                                 
|           |  |                                                                                                                                 
|[  ]       |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934.                                       

Commission file number: 1-10893

ABLEST INC.
(Exact name of registrant as specified in its charter)

|                                                     |  |                    
|---------------------------------------------------- |  | -------------------
|Delaware                                             |  | 65-0978462         
|(State or other jurisdiction of                      |  | (I.R.S. Employer   
|incorporation or organization)                       |  | Identification No.)
|                                                     |  |                    
|1901 Ulmerton Road, Suite 300, Clearwater, Florida   |  | 33762              
|(Address of principal executive offices)             |  | (Zip Code)         
|                                                     |  |                    
|(727) 299-1200                                       |  |                    
|(Registrants telephone number, including area code) |  |                    

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, $.05 par value
(Title of Class)

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]     No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrants knowledge, in definitive proxy or information
statements, incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K (X ).

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The aggregate market value of the Registrants common shares held by
non-affiliates at February 28, 2002 was approximately $4,906,000.

The number of common shares of the Registrant outstanding at February 28, 2002
was 2,899,085.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the following documents are incorporated by reference in the
following part of this report: Part III  the Registrants definitive proxy
statement to be filed with the Securities and Exchange Commission and used in
connection with the solicitation of proxies for the Registrants annual meeting
of shareholders to be held on May 23, 2002.

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TABLE OF CONTENTS



|                                            |                                                                                               |                                    |  |  |  |  |  | 
|------------------------------------------- | --------------------------------------------------------------------------------------------- | ---------------------------------- |  |  |  |  |  | 
|PART I                                     
|                                            | ITEM 1. Business                                                                             
|                                            | ITEM 2. Properties                                                                           
|                                            | ITEM 3. Legal Proceedings                                                                    
|                                            | ITEM 4. Submission of Matters to a Vote of Security Holders                                  
|PART II                                    
|                                            | ITEM 5. Market for Registrants Common Equity and Related Stockholder Matters                
|                                            | ITEM 6. Selected Financial Data                                                              
|                                            | ITEM 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                            | ITEM 7A. Quantitative and Qualitative Disclosure About Market Risk                           
|                                            | ITEM 8. Financial Statements and Supplemental Data                                           
|                                            |                                                                                               | Balance Sheets                    
|                                            |                                                                                               | Statements of Operations          
|                                            |                                                                                               | Statements of Stockholders Equity
|                                            |                                                                                               | Statements of Cash Flows          
|Notes to Financial Statements              
|SIGNATURES                                 
|Standard LIBOR Grid Note                   
|Employment Agreement dated January 21, 2002
|Letter to SEC; RE: Arthur Andersen         
|List of Subsidiaries                       
|Consent of Arthur Andersen LLP             




PART I




ITEM 1.      Business

General.

Prior to March 13, 2000, Ablest Inc. (the Company) operated as C. H. Heist
Corp. with two service segments: Staffing Services and Industrial Maintenance.

On March 13, 2000, the Company sold substantially all of the assets of its
United States industrial maintenance business and the stock of its Canadian
subsidiary, C. H. Heist, Ltd., to Onyx Industrial Services, Inc. (Onyx). For
the fiscal years reported herein, the Companys industrial maintenance business
is being reported as a discontinued operation. See note 2 to the Financial
Statements included under Item 8 to this report on Form 10-K for additional
information on the discontinued operations.

Also on that date and following the sale of the Companys industrial
maintenance business to Onyx, the Company reincorporated in Delaware, changed
its name to Ablest Inc. and became a pure-play staffing services company.

On January 1, 2001, Ablest Service Corp., Milestone Technologies Inc. and
P.L.P. Corp. (part of the discontinued operations) merged into Ablest Inc. to
form a single operating company under the Ablest Inc. name. See note 1 to the
Financial Statements included under Item 8 to this report on Form 10-K for
additional information on the re-incorporation and merger.

Staffing Services

The Company offers staffing services in the United States. Staffing services
are principally provided through 49 service locations in the Eastern United
States and selected Southwestern markets with the capability to supply staffing
services for the clerical, industrial and information technology needs of their
customers. Positions in the Companys commercial staffing services segment
often filled include, but are not limited to, data entry, office
administration, telemarketing, light industrial assembly, order picking and
shipping. Positions in the Companys information technology staffing services
segment include, but are not limited to, network administration, data base
administration, program analyst (both mainframe and client server), web
development, project management and technical writing. Ablest does not service
any specific industry or field; instead, its services are provided to a
broad-based customer list.

The staffing services business is highly competitive with few barriers to
entry. There are numerous local, regional and national firms principally
engaged in offering such services. The primary competitive factors in the
staffing services field are quality of service, reliability of personnel and
price.

Industry Segments and Service Activities.

The table on the following page is a summary of information relating to
the Companys operations in its two industry segments for each of the Companys
last three fiscal years. The discontinued operation noted refers to the
Companys former industrial maintenance operations.

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|                                      |                        |              |   |              |   |              |  |         |   |  |  |        |  
|------------------------------------- | ---------------------- | ------------ | - | ------------ | - | ------------ |  | ------- | - |  |  | ------ | -
|(In thousands)                        |                        | December 30, |   | December 31, |   | December 26,
|                                      |                        | 2001         |   | 2000         |   | 1999        
|                                      |                        |              |   |              |   |              | 
|Revenues from Unaffiliated Customers: |                        |              |   |              |   |              |  |         |   |  |  |       
|                                      | Staffing Services      |              | $ | 87,042       |   |              |  | 103,435 |   |  |  | 98,094 |  
|                                      | Discontinued Operation |              |   |             |   |              |  | 12,565  |   |  |  | 54,317 |  
|                                      |                        |              |   |              |   |              |  |         |   |  |  |       
|Operating (Loss) Income :             |                        |              |   |              |   |              |  |         |   |  |  |       
|                                      | Staffing Services      |              |   | (5,674       | ) |              |  | 1,193   |   |  |  | (3,459 | )
|                                      | Discontinued Operation |              |   |             |   |              |  | (15     | ) |  |  | (2,991 | )
|                                      |                        |              |   |              |   |              |  |         |   |  |  |       
|Identifiable Assets:                  |                        |              |   |              |   |              |  |         |   |  |  |       
|                                      | Staffing Services      |              |   | 18,056       |   |              |  | 21,696  |   |  |  | 22,639 |  
|                                      | Discontinued Operation |              |   | 261          |   |              |  | 1,276   |   |  |  | 31,308 |  

The following table sets forth the approximate percentages of revenues by
service activity within the Companys Staffing Services operations for each of
the Companys last three fiscal years:

|                            |                                 |  |              |    |              |  |              |    |   |  |  |    |  
|--------------------------- | ------------------------------- |  | ------------ | -- | ------------ |  | ------------ | -- | - |  |  | -- | -
|                            |                                 |  | December 30, |    | December 31, |  | December 26,
|                            |                                 |  | 2001         |    | 2000         |  | 1999        
|                            |                                 |  |              |    |              |  |             
|Staffing Services Revenues: |                                 |  |              |    |              |  |              |    |   |  |  |   
|                            |                                 |  |              |    |              |  |              |    |   |  |  |   
|                            | Commercial Staffing             |  |              | 88 | %            |  |              | 85 | % |  |  | 78 | %
|                            |                                 |  |              |    |              |  |              |    |   |  |  |   
|                            | Information Technology Staffing |  |              | 12 | %            |  |              | 15 | % |  |  | 22 | %

Working Capital. By virtue of the nature of the Companys business, the
attainment and maintenance of high levels of working capital is not required,
other than to meet debt requirements as disclosed in Note 7 to the Financial
Statements shown under Item 8 to this Form 10-K.

Backlog. In view of the fact that the Companys services are primarily
furnished pursuant to purchase orders or on a call basis, backlog is not
material.

Employees. The ongoing staffing business comprises approximately 3,013 persons,
162 of which were full time at December 30, 2001. The Company considers its
employee relations to be satisfactory.

Canadian Operations. Up through March 13, 2000, the Companys former
industrial maintenance business included operations in Canada. In connection
with the sale of the industrial maintenance business all of the common stock of
the Companys Canadian Subsidiary, C. H. Heist, Ltd., was sold to Onyx
Industrial Services, Inc. The operations of the Canadian subsidiary, up through
the sale date, are included with the discontinued operations. See note 2 to the
Financial Statements included under Item 8 to this report on Form 10-K for
additional information on the discontinued operations.

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Executive Officers of Registrant

Identification. The Companys executive officers are:

|                    |  |     |    |                 |  |                                                   |  |           |      | 
|------------------- |  | --- | -- | --------------- |  | ------------------------------------------------- |  | --------- | ---- | 
|                    |  |     |    |                 |  |                                                   |  | Served as
|                    |  |     |    |                 |  | Position and Office                               |  | Executive
|Name                |  | Age |    | with Registrant |  | Officer Since                                    
|                    |  |     |    |                 |  |                                                  
|Charles H. Heist    |  |     | 51 |                 |  | Chairman of the Board of Directors                |  |           | 1978 | 
|                    |  |     |    |                 |  |                                                   |  |           |      | 
|W. David Foster     |  |     | 67 |                 |  | Chief Executive Officer                           |  |           | 1976 | 
|                    |  |     |    |                 |  |                                                   |  |           |      | 
|Kurt R. Moore       |  |     | 42 |                 |  | President and Chief
Operating Officer             |  |           | 1991 | 
|                    |  |     |    |                 |  |                                                   |  |           |      | 
|Vincent J. Lombardo |  |     | 40 |                 |  | Vice President and Chief Financial
Officer        |  |           | 2002 | 
|                    |  |     |    |                 |  |                                                   |  |           |      | 
|Mark P. Kashmanian  |  |     | 46 |                 |  | Treasurer, Secretary and Chief
Accounting Officer |  |           | 1996 | 

(b)  Arrangements and Understandings. There are no arrangements or
understandings pursuant to which the above officers were elected.

(c)  Family Relationships. None of the officers has any family relationship
with any other officer of the Company.




ITEM 2.      Properties

The Company currently leases 13,724 square feet of office space in Clearwater,
Florida that serves as its corporate headquarters. Fifty-five additional
facilities are leased under rental agreements and under terms and conditions
prevailing in the various service locations. The Company considers all of its
offices and facilities suitable and adequate for servicing its customers.




ITEM 3.      Legal Proceedings

The Company is subject, from time to time, to claims encountered in the normal
course of business. In the opinion of management, the resolution of all pending
matters will not have a material adverse effect on the Companys financial
condition or liquidity.




ITEM 4.      Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of security holders of the Company during
the fourth quarter of fiscal 2001.

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PART II




ITEM 5.      Market for Registrants Common Equity and Related Stockholder Matters

(a)(i) Market for Registrants Common stock:

The Companys common stock currently trades on the American Stock Exchange
under the symbol AIH. For the period from March 13, 2000 to November 20, 2000
the Companys common stock was traded under the symbol ABI. Prior to March
13, 2000 the common stock was traded under the symbol HST.

(a)(ii) Price Range of Common Stock:

The price ranges applicable to the common shares during each quarter of the
years ended December 30, 2001 and December 31, 2000, are as follows:

|            |  |      |      |      |  |      |      |     |  |  |      |  |  |  |      | 
|----------- |  | ---- | ---- | ---- |  | ---- | ---- | --- |  |  | ---- |  |  |  | ---- | 
|            |  | 2001 |      | 2000
|            |  |      |      |     
|            |  | High |      | Low  |  | High |      | Low
|            |  |      |      |      |  |      |      |    
|1st Quarter |  | $    | 5.25 |      |  |      | 4.50 |     |  |  | 8.75 |  |  |  | 5.75 | 
|2nd Quarter |  |      | 4.85 |      |  |      | 4.41 |     |  |  | 6.25 |  |  |  | 4.50 | 
|3rd Quarter |  |      | 4.90 |      |  |      | 4.45 |     |  |  | 5.88 |  |  |  | 4.13 | 
|4th Quarter |  | $    | 4.85 |      |  |      | 4.45 |     |  |  | 6.00 |  |  |  | 4.13 | 

(b)  Approximate Number of Common Shareholders:

On December 30, 2001, there were 513 registered shareholders.

(c)  Dividends:

The Company currently does not pay a dividend on its common shares.




ITEM 6.      Selected Financial Data

(In thousands, except per share data)


|                                                             |                   |      |        |       |   |       |         |       |  |       |        |       |   |  |        |     |  |  |        |     | 
|------------------------------------------------------------ | ----------------- | ---- | ------ | ----- | - | ----- | ------- | ----- |  | ----- | ------ | ----- | - |  | ------ | --- |  |  | ------ | --- | 
|Fiscal Year Ended December                                   |                   | 2001 |        | 2000  |   | 1999* |         | 1998* |  | 1997*
|                                                             |                   |      |        |       |   |       |         |       |  |      
|Net service revenues                                         |                   | $    | 87,042 |       |   |       | 103,435 |       |  |       | 98,094 |       |   |  | 78,471 |     |  |  | 63,268 |    
|Net (loss) earnings from continuing operations               |                   |      | (5,120 | )     |   |       | 592     |       |  |       | (3,956 | )     |   |  | 876    |     |  |  | 163    |    
|(Loss) earnings per common share from
continuing operations: |                   |      |        |       |   |       |         |       |  |       |        |       |   |  |        |     |  |  |        |    
|                                                             | basic and diluted |      |        | (1.75 | ) |       |         | .21   |  |       |        | (1.37 | ) |  |        | .30 |  |  |        | .06 | 
|                                                             |                   |      |        |       |   |       |         |       |  |       |        |       |   |  |        |     |  |  |        |    
|Total assets                                                 |                   |      | 17,212 |       |   |       | 24,759  |       |  |       | 44,009 |       |   |  | 53,340 |     |  |  | 41,838 |    
|Long-term debt                                               |                   | $    |       |       |   |       |        |       |  |       | 15,950 |       |   |  | 16,050 |     |  |  | 8,755  |    

* Restated to reflect discontinued operations, which are more fully discussed
in note 2 to the financial statements.

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The following summarizes quarterly operating results:

|                                                  |                   |     |        |      |   |     |        |      |   |  |        |      |   |  |        |       |  
|------------------------------------------------- | ----------------- | --- | ------ | ---- | - | --- | ------ | ---- | - |  | ------ | ---- | - |  | ------ | ----- | -
|2001 Quarters                                     |                   | 1st |        | 2nd  |   | 3rd |        | 4th 
|                                                  |                   |     |        |      |   |     |        |     
|Net service revenues                              |                   | $   | 21,846 |      |   |     | 21,021 |      |   |  | 22,814 |      |   |  | 21,361 |      
|Gross profit                                      |                   |     | 4,534  |      |   |     | 4,380  |      |   |  | 4,669  |      |   |  | 3,373  |      
|Operating loss                                    |                   |     | (773   | )    |   |     | (551   | )    |   |  | (112   | )    |   |  | (4,238 | )    
|Net loss from continuing operations               |                   |     | (501   | )    |   |     | (335   | )    |   |  | (166   | )    |   |  | (4,118 | )    
|Loss per common share from
continuing operations: |                   |     |        |      |   |     |        |      |   |  |        |      |   |  |        |      
|                                                  | basic and diluted |     | $      | (.17 | ) |     |        | (.12 | ) |  |        | (.06 | ) |  |        | (1.40 | )

|                                                             |                   |     |        |     |  |     |        |     |  |  |        |     |  |  |        |      |  
|------------------------------------------------------------ | ----------------- | --- | ------ | --- |  | --- | ------ | --- |  |  | ------ | --- |  |  | ------ | ---- | -
|2000 Quarters*                                               |                   | 1st |        | 2nd |  | 3rd |        | 4th
|                                                             |                   |     |        |     |  |     |        |    
|Net service revenues                                         |                   | $   | 25,893 |     |  |     | 24,906 |     |  |  | 26,139 |     |  |  | 26,497 |     
|Gross profit                                                 |                   |     | 5,872  |     |  |     | 5,557  |     |  |  | 5,813  |     |  |  | 5,592  |     
|Operating income                                             |                   |     | 117    |     |  |     | 264    |     |  |  | 763    |     |  |  | 49     |     
|Net earnings (loss) from continuing operations               |                   |     | 75     |     |  |     | 141    |     |  |  | 425    |     |  |  | (49    | )   
|Earnings (loss) per common share from
continuing operations: |                   |     |        |     |  |     |        |     |  |  |        |     |  |  |        |     
|                                                             | basic and diluted |     | $      | .03 |  |     |        | .05 |  |  |        | .15 |  |  |        | (.02 | )

*     Restated to reflect discontinued operations, which are more fully discussed
in note 2 to the financial statements.




ITEM 7.      Managements Discussion and Analysis of Financial Condition and Results of Operations

Statements made in this discussion, other than those concerning historical
information, should be considered forward-looking and subject to certain risks
and uncertainties that could cause actual results to differ materially from
those anticipated. This notice is intended to take advantage of the safe harbor
provided by the Private Securities Litigation Reform Act of 1995 with respect
to such forward-looking statements. Risks and uncertainties include, but are
not limited to; hiring and maintaining qualified employees, legislative and
judicial reforms which could increase the cost of our services to our customers
and make the use of staffing service providers less beneficial, the proper
functioning of our management information systems and the continuing economic
recession.

On March 13, 2000, C.H. Heist Corp., sold substantially all of the assets of
its United States industrial maintenance business and the stock of C. H. Heist
Corp.s wholly owned Canadian subsidiary, C.H. Heist, Ltd., to Onyx Industrial
Services, Inc. Taken together, these operations comprised substantially all of
the assets of C. H. Heist Corp.s industrial maintenance operations. Included
in the sale was C. H. Heist Corp.s administrative and warehousing facility in
Buffalo, New York. Also on March 13, 2000, C. H. Heist Corp. merged into a
newly formed company, Ablest Inc., and reincorporated in the state of Delaware.

On January 1, 2001, the Companys subsidiaries Ablest Service Corp. (a Delaware
corporation), Milestone Technologies, Inc. (an Arizona corporation) and PLP
Corp. (an Alabama corporation) were formally merged into Ablest Inc. (a
Delaware corporation), to form a single operating company under the Ablest Inc.
name. The outstanding shares of the merging corporations were cancelled and no
shares of Ablest Inc. were issued in exchange. The outstanding shares of Ablest
Inc. remain outstanding and were not affected by the merger.

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For financial reporting purposes, the Companys former industrial maintenance
business is reported as a discontinued operation. The following discussions
and analysis of operations and financial condition pertain to the Companys
staffing services business, which constitutes the continuing operations. A
separate section labeled
Discontinued Operations is included at the end of this discussion and
pertains to the disposal of the industrial maintenance business.

For the fiscal year ended December 30, 2001, compared to December 31, 2000.

Fiscal Year 2001 was comprised of 52 weeks compared to 53 weeks in fiscal 2000.

Results of Operations:

Service revenues declined by $16.4 million or 15.9% to $87.0 million from
$103.4 million for the year ended December 30, 2001 compared to the year ended
December 31, 2000.

Service revenues for the Companys commercial staffing services segment
decreased by $11.6 million or 13.2% to $76.6 million from $88.2 million for the
current year compared to one year earlier. This decrease is primarily a result
of an overall decline in demand for the Companys commercial staffing services
as a result of the economic recession that has occurred in the United States.
Historically, the staffing industry is one of the first to feel the impact of a
declining economy and conversely, is one of the first to benefit from an
improving economy. During fiscal 2001, the Company closed six commercial
staffing offices that were not performing up to expectations or were severely
impacted by significant declines in their respective local economies. These
offices accounted for $3.6 million of the overall decline in commercial
staffing services in fiscal 2001 as compared to fiscal 2000.

Service revenue in the Companys information technology staffing services
segment declined by $4.8 million or 31.4% to $10.4 million from $15.2 million
for the current year compared to one year earlier. This segment was especially
hard hit by the decline in the general economy and the softening of demand for
information technology staffing services, post year 2000 conversion.
Contributing to this decline was a decrease in placement fees generated by this
segment. For the year ended December 30, 2001 placement fees accounted for .7%
of information technology staffing services as compared to 4.6% for the year
ended December 31, 2000. Additionally, In December of 2001, the Company closed
one of its information technology staffing offices that had shown a decline of
approximately $900,000 in service revenues from the prior year.

Gross Profit decreased by $5.9 million or 25.8% to $17.0 million for the
current fiscal year compared to fiscal 2000. Gross profit for the commercial
staffing segment declined $3.5 million or 18.6% over the same period. Gross
profit for the Companys information technology staffing services segment
declined by $1.6 million or 40.8% for the current fiscal year compared to
fiscal 2000. The decline in gross profit for both segments is related to the
decline in the service revenues and a decline in gross margin. Gross margin
declined by 2.6 percentage points to 19.5% from 22.1% for fiscal 2001, compared
to fiscal 2000. For the commercial staffing services segment, the decline in
gross margin is partially attributable to a change in the sales mix where a
greater percentage of revenue is being derived from light industrial and
payrolling services. For the year ended December 30, 2001, light industrial
services as a percentage of commercial staffing services revenue increased to
76.2% from 68.0%, compared to one year earlier. Driving this change in the
sales mix is the increase in total staffing services being derived from the
Companys Vendor-On-Premises programs. These services represented 19.8% of
revenues for this segment in fiscal 2001 compared to 10.1% of revenues in the
prior year. These programs may require the use of out-side staffing service
companies (Tiered Suppliers), on a direct passthrough basis, to supplement
the existing workforce. While they do not negatively impact profitability, they
do affect gross margin calculations. Bidding for these services is highly
competitive and, due to their large volume, require lower margins to secure the
contracts. For the Companys information technology staffing services segment,
gross margin declined by 3.5 percentage points for the comparable year-to-date
periods. This decline is partially attributable to the decline in permanent
placement fees noted earlier and the use of Tiered Suppliers, which accounted
for 5.6% of this segments revenues in the current year compared to 0% in the
prior year.

8



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Selling, general and administrative expense, exclusive of amortization expense
and intangible asset impairment, declined by approximately $1.9 million or 8.9%
for the current year compared to one year earlier. This decline is the result
of the cost reduction and staff elimination that were done during the second
and fourth quarters when
the Company closed seven under performing branch locations. During fiscal 2001,
the Company recorded $250,000 in reorganization expense relating to the closing
of the seven offices noted above.

In the fourth quarter of 2001, the Company incurred non-cash charges of $2.9
million relating to the impairment of goodwill and other intangible assets
associated with various information technology staffing acquisitions made in
previous fiscal years. The Company has continuously reviewed the information
technology staffing acquisitions to determine whether it can continue to
support the carrying value of the intangible assets that were established at
the time of the respective acquisitions. Based upon several factors, including
a steady decline in revenue and earnings, the loss of a major customer,
management changes that occurred in the fourth quarter and the continued
weakening of demand in this segment of the staffing industry, an impairment
triggering event was deemed to have occurred. Based on the projected discounted
future cash flows from this segment, the related goodwill and other intangible
assets were written down to their estimated current net realizable values.

Other income (expense), net, increased by $80,000 to $94,000 in the current
fiscal year as compared to the prior year. Interest income, net, amounted to
approximately $22,000 in the current year as compared to a net interest expense
of $135,000 in 2000. Also contributing to the increase in other income, net,
was the one time receipt of $73,000 from the demutualization of the Companys
former pension and 401-K plan service provider.

The effective tax rate for the current fiscal year is a benefit of 8.3%. Based
upon the level of historical taxable income and projections for future taxable
income over the years in which the deferred tax assets are deductible,
management has provided valuation allowances for those deferred tax assets that
are not expected to be realized. The Company recorded a valuation allowance of
$2.3 million in the current year against a deferred tax benefit of $2.8
million, resulting in a recognized benefit of $460,000. In 2000, the recorded
tax provision of $615,000 represented an effective rate of 50.9% due to the
impact of changes in estimates of previously recognized tax benefits and the
non-deductibility for tax purposes of certain expenses (mainly goodwill
amortization) incurred by the Company.

Critical Accounting Policies

The Company has identified the policies below as critical to the Companys
business operations and the understanding of its results of operations. For a
detailed discussion on the application of these and other accounting policies,
see Note 1 in the Notes to the Financial Statements in Item 8 of this Annual
Report on Form 10-K. Note that the preparation of this Annual Report on Form
10-K requires management to make estimates and assumptions that affect the
reported amount of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of revenue and expenses during the reporting period. Management bases
its estimates on historical experience and on various other assumptions that
are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results
may differ from these estimates under different assumptions or conditions.

(a)  Allowance for doubtful accounts

The Company must make estimates of the collectibility of accounts receivables.
Management analyzes historical bad debts, customer concentrations, customer
credit-worthiness, current economic trends and changes in the customers
payment tendencies when evaluating the adequacy of the allowance for doubtful
accounts. The accounts receivable balance was $10.2 million, net of allowance
for doubtful accounts of $252,000 as of December 30, 2001.

9



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##### 



(b)  Self-insurance reserves

The Company is self-insured for general liability and workers compensation
coverages. Accruals for losses are made based on the Companys claims
experience and actuarial assumptions followed in the insurance industry.
Management believes that the amount accrued is adequate to cover all known and
unreported claims at December 30, 2001.

(c)  Intangible asset impairment

The Company assesses the impairment of intangible assets whenever events or
changes in circumstances indicate that the carrying value may not be
recoverable. Factors that are considered include significant underperformance
relative to expected historical or projected future operating results,
significant negative industry trends and significant change in the manner of
use of the acquired assets. When management determines that the carrying value
of intangible assets may not be recoverable, they measure any impairment based
on a projected discounted cash flow method using a discount rate determined by
management to be commensurate with the risk inherent in the Companys current
business model. During the year ended December 30, 2001, the Company recorded
an impairment loss of $2.9 million related to intangible assets. Net intangible
assets, amounted to $1.3 million as of December 30, 2001.

Liquidity and Capital Resources:

The following financial information is provided as of a balance sheet date of
December 30, 2001.

The quick ratio was 3.7 to 1 and 2.9 to 1 at December 30, 2001 and December 31,
2000, respectively, and the current ratio was 3.8 to 1 and 3.5 to 1, for the
same respective periods. Net working capital decreased by $3.5 million during
the current year. Contributing to this decrease was a reduction in accounts
receivable of $4.4 million due to the decreased level of revenue being
generated during this period. This decrease was partially offset by an increase
in cash of $201,000 and a decrease in accrued expenses and accounts payable of
$2.0 million and $161,000, respectively. Accrued expenses decreased primarily
due to the payment of both the 1999 and 2000 insurance retrospective premium
adjustments in the current year. Also contributing to this decrease was a
reclassification of $1.3 million of current deferred tax assets to long term
deferred tax assets relating to the Companys net operating loss carryforward
from prior periods. Reference should be made to the Statement of Cash Flows,
which details the sources and uses of cash.

Capital expenditures for the current fiscal year were approximately $627,000.
Approximately $515,000 of the total additions pertains to new front office
automation and applicant matching software and related systems that were
implemented throughout the Companys operations. It is anticipated that
existing funds, cash flows from operations and available borrowings will be
sufficient to cover working capital requirements and capital expenditures for
fiscal 2002.

On July 22, 2001, The Company entered into a Standard LIBOR Grid Note Agreement
(LIBOR Agreement) with The Manufacturers and Traders Trust Company (M&T).
The LIBOR Agreement allows for the borrowing for general corporate needs of up
to $5.0 million with interest calculated at the banks then prime lending rate
or, at the Companys option, using a formula which adds 250 basis points or
2.5% to the 30, 60 or 90 day London Interbank Offered Rate LIBOR rate. The
LIBOR Agreement is a one-year demand note that expires on July 21, 2002, and is
renewable annually with the consent of both parties. The LIBOR Agreement does
not contain working capital or other financial covenants. The Company believes
that this line will be renewed and will be sufficient to cover foreseeable
operational funding requirements in 2002. Since, however, the Company must
repay any borrowings under the LIBOR Agreement to M&T on demand, there is no
guarantee that the Company will be able to maintain or obtain funding from M&T
if, for any

10



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##### 



reason, M&T does not wish to continue to extend credit to the
Company. At the current time, given the Companys financial condition, the
nature of its business which does not require attainment or maintenance of high
levels of working capital, its historical relationship with M&T and the fact
that working capital requirements tend to decline if revenues decline, the
Company believes that it will be able to borrow required funds from M&T under
the LIBOR Agreement. If, however, M&T were to demand repayment of the
borrowings (or decline to provide funding) under the LIBOR Agreement for any
reason, the Company would be in the position of having to secure from other
sources funding to finance its working capital requirements. Such new sources
could require commitment fees, financial covenants and other conditions, taking
into consideration such factors as the health of the national economy, staffing
industry performance and trends, and the Companys financial condition,
performance and prospects. In such event, there is no guarantee that the
Company would be able to secure such funding on favorable terms.

At December 31, 2000, the Company had a $25,000,000 unsecured bank line of
credit under a revolving credit agreement. Effective for 2001, the Revolving
Term Loan Agreement between the Company and M&T dated August 21, 1995 was
reduced to $5,000,000 and was set to mature on August 1, 2001. The interest
rate on borrowings under the line of credit was elected weekly by the Company
and was either (i) the banks prime rate or (ii) the Secondary Market
Certificate of Deposit (CD) Rate plus 3/4%. The rate in effect at December 31,
2000 was 7.275%. On July 31, 2001, the Company had the option of converting
the then outstanding borrowings to a term loan, payable in twenty equal
quarterly installments beginning August 1, 2002 and bearing interest at either
(i) the banks prime rate plus 1/2% or (ii) the Secondary Market CD Rate plus
1-1/2%. If converted, the company continues electing, on a weekly basis, the
interest rate to be charged. The revolving credit agreement contained working
capital requirements, and limited the amount of liabilities, capital
expenditures and payment of cash dividends. Under the most restrictive of
these provisions, $1,000,000 of retained earnings was free of dividend
restrictions at December 31, 2000. Due to the sale of the industrial
maintenance operations, the Company was not in compliance with certain of the
covenants relating to the levels of net working capital and net worth of the
Company to be maintained and as such obtained a waiver from the bank for all
breached covenants. Compensating balances, may be, but were not required, to be
maintained. On July 22, 2001 the Company canceled the above noted credit
facility and replaced it with the LIBOR Agreement, noted previously.

Discontinued Operations:

At December 30, 2001 the combined balance in the remaining reserve for loss on
sale of discontinued operations was $325,000. The Company believes that the
balance in the reserve account is sufficient to cover all remaining items from
the sale of its industrial maintenance operations to Onyx in 2000. The reserves
will be utilized to complete environmental remediation in two of the Companys
former industrial maintenance locations, to cover any damages against the
Companys former Canadian subsidiary resulting from an on-going law suit and to
cover any future insurance retrospective premium adjustments in the United
States.

In August 2001, the Company sold its former Lima, Ohio property for a gain
of approximately $17,000. In December 2001, the Company sold its former
Charlotte, North Carolina facility for $1.1 million and recognized a gain in
the net assets of discontinued operations of approximately $396,000. Also in
December 2001, the Company received a one-time distribution, on behalf of the
discontinued operations, of $222,000 from the demutualization of its former
pension and 401-K service provider. Prior to year-end the Company made a final
payment to Onyx of approximately $62,500 to settle all outstanding items under
the Asset Sales and Purchase Agreement dated January 21, 2000.

11



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##### 



For the fiscal year ended December 31, 2000, compared to December 26, 1999.

Fiscal Year 2000 was comprised of 53 weeks compared to 52 weeks in fiscal 1999.

Results of Operations:

Service revenues increased by $5.3 million or 5.4% to $103.4 million from $98.1
million for the year ended December 31, 2000, compared to the year ended
December 26, 1999.

Service revenue in the Companys commercial staffing services segment increased
by $11.6 million or 15.3% to $88.2 million from $76.6 million for fiscal 2000
compared to one year earlier. Of this amount $12.0 million was from seven
offices opened in fiscal 1999 and six offices opened in fiscal 2000. All of
the branches opened in fiscal 1999 were profitable in fiscal 2000 and three of
the six offices opened in fiscal 2000 were profitable on a year to date basis
at year-end. Additional increases in service revenue for this segment were
generated by the Companys Vendor-on-Premises programs (Point Source) that
were secured and started in fiscal 2000.

Service revenues in the Companys information technology staffing segment
decreased by $6.3 million or 29.4% to $15.2 million from $21.5 million for
fiscal 2000 compared to one year earlier. This decline reflects the
continued post Year 2000 industry-wide slowdown in information technology
spending. Ablest Technology Services is in the process of shifting from its
original focus of primarily servicing low-end solutions work toward
applications where trained professionals are scarce but generate higher
margins. Additionally, managerial and structural changes have been made to this
segment during fiscal 2000 to position it to take advantage of the changing
marketplace for information technology services in fiscal 2001 and to stop the
decline that has occurred in this segment over the past 18 months.

Gross profit dollars increased by $625,000 or 2.8% to $22.8 million from $22.2
million for fiscal 2000 compared to fiscal 1999. Gross profit margin declined
to 22.1% from 22.6% over the same period. The increase in gross profit dollars
is primarily the result of the increased service revenue generated by the
commercial staffing segment, which was partially offset by the decline in
service revenues from the information technology staffing segment. The decline
in gross margin is primarily the result of the increase in Point Source
programs, noted previously, that generates lower margins on higher volumes.
These programs require the use of tiered staffing suppliers on a direct
pass-through basis. Billings for these services were approximately $1.5 million
in fiscal 2000 compared to $456,000 in fiscal 1999. Without these pass-through
services the gross margin would have been 22.4% in fiscal 2000 compared to
22.7% in fiscal 1999. In addition, the demand for full time placements, which
produce higher gross margins, was less in fiscal 2000.

Selling, general and administrative expenses, inclusive of amortization
expense, increased to $21.6 million from $20.6 million for fiscal 2000 compared
to fiscal 1999. As a percentage of service revenues, selling, general and
administrative expenses declined to 20.9% from 21.0%. Contributing to the
increase in selling, general and administrative expense dollars were
transitional expenses associated with the closing and subsequent relocation of
the Companys administrative office in Buffalo, New York to the new leased
corporate facilities in Clearwater, Florida, during the first half of fiscal
2000. Selling, general and administrative expenses during the second half of
fiscal 2000 declined by $266,000 over the same period one year earlier. This
decline is partly attributed to a leveling-off of corporate expenses as the
company settled into their new corporate facility. In addition, adjustments
were made in the Companys information technology staffing segment to right
size the operation to the level of activity being generated. Also contributing
was a decrease in amortization expense of $358,000 in fiscal 2000 compared to
fiscal 1999. This decrease is the result of the intangible asset impairment
charge taken by the Company in the fourth quarter of fiscal 1999. The
remaining intangible assets were reviewed at the end of fiscal 2000 and found
to adequately support discounted cash flow projections. As such no adjustment
was warranted in fiscal 2000.

Other income (expense), net, improved in fiscal 2000 by $443,000 to $14,000
compared to a net other expense of $429,000 for fiscal 1999. In March, the
company used a portion of proceeds from the sale of its industrial maintenance
business to pay off their revolving term debt. The result was a decline in
interest expense of $404,000 in fiscal 2000 compared to fiscal 1999.

12



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##### 



The effective tax rate was 50.9% for fiscal 2000. The effective tax rate was
the result of the multiple taxing jurisdictions in which the company operates
and the non-deductibility, for tax purposes, in the current period of certain
expenses incurred by the Company.

Discontinued Operations:

During fiscal 2000, a minor adjustment was made to the previously recorded loss
on sale of discontinued operations to reconcile amounts previously recorded
against continuing operations but which pertained to the discontinued
operations. Expenditures associated with the winding down of the discontinued
operations were adjusted against the various reserves established at the
measurement date of September 26, 1999. At that time, reserves were
established for an anticipated loss on the sale of discontinued operations,
holding period losses, severance payments and transactional expenses.
Management believes that balances remaining in the respective reserves will be
sufficient to cover future anticipated expenses associated with the
discontinued operations.




ITEM 7A.      Quantitative and Qualitative Disclosure About Market Risk

The Company, in the normal course of business, has exposure to interest rate
risk from its long-term debt obligations. The Company does not believe that its
exposure to fluctuations in interest rates is material. A 10% change in the
interest rate utilized on its long-term debt obligations would have produced
less than $1,000 in additional interest expense for the fiscal year ended
December 30, 2001.

Due to the immateriality of the above noted market risk, the Company has
decided not to utilize any form of financial instrument as a hedge against this
risk.

13



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##### 






ITEM 8.      Financial Statements and Supplemental Data

Index to Financial Statements

|                                                                                                         |  |                                                                                                                   |  |               
|-------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------- |  | --------------
|                                                                                                         |  |                                                                                                                   |  | Page Reference
|                                                                                                         |  |                                                                                                                   |  |               
|The financial
statements
of the registrant
     required to be included in
Item 8
     are listed below: |  |                                                                                                                   |  |               
|                                                                                                         |  | Report of Independent Certified Public Accountants                                                                |  | 15            
|                                                                                                         |  | Financial
Statements:                                                                                             |  |               
|                                                                                                         |  | Balance Sheets as of December 30, 2001 and December 31, 2000                                                      |  | 16            
|                                                                                                         |  |                                                                                                                   |  |               
|                                                                                                         |  | Statements of Operations for the years ended
December 30, 2001, December 31, 2000 and December 26, 1999           |  | 17            
|                                                                                                         |  |                                                                                                                   |  |               
|                                                                                                         |  | Statements of Stockholders Equity for the years ended December 30,
2001, December 31, 2000 and December 26, 1999 |  | 18            
|                                                                                                         |  |                                                                                                                   |  |               
|                                                                                                         |  | Statements of Cash Flows for the years ended December 30, 2001,
December 31, 2000 and December 26, 1999           |  | 19-20         
|                                                                                                         |  |                                                                                                                   |  |               
|                                                                                                         |  | Notes to Financial Statements                                                                                     |  | 21-38         

14



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##### 



Report of Independent Certified Public Accountants

To Ablest Inc.:

We have audited the accompanying balance sheet of Ablest Inc. (a Delaware
corporation) as of December 30, 2001, and the related statements of operations,
stockholders equity and cash flows for the year then ended. These financial
statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on these financial statements based on
our audit. The financial statements of Ablest Inc. as of December 31, 2000,
were audited by other auditors whose report dated February 16, 2001, expressed
an unqualified opinion on those statements.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Ablest Inc. as of December 30,
2001, and the results of its operations and its cash flows for the year then
ended in conformity with accounting principles generally accepted in the United
States.

| |  |                    
| |  | -------------------
| |  | ARTHUR ANDERSEN LLP

Tampa, Florida,
     February 1, 2002

15



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##### 



ABLEST INC.




Balance Sheets

(In thousands, except share
data)


|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |              |        |   |        | 
|--------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------- | ------ | -------------------------- | ------ | ------------ | ------ | ------------ | ------ | - | ------ | 
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        | December 30, |        | December 31,
|Assets                                                                                                          |                                                                                                   | 2001                                                                                                        |        | 2000                      
|                                                                                                                |                                                                                                   |                                                                                                             |        |                           
|Current assets:                                                                                                 |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                | Cash and cash equivalents                                                                         |                                                                                                             | $      | 607                        |        |              |        | 406          |       
|                                                                                                                | Receivables,
less allowance for doubtful accounts of
$252 and $390 in 2001 and 2000, respectively |                                                                                                             |        | 10,232                     |        |              |        | 14,629       |       
|                                                                                                                | Prepaid expenses and other                                                                        |                                                                                                             |        | 237                        |        |              |        | 359          |       
|                                                                                                                | Deferred income taxes (note 9)                                                                    |                                                                                                             |        | 1,193                      |        |              |        | 2,549        |       
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             |        | Total current assets       |        |              | 12,269 |              |        |   | 17,943 | 
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|Property, plant and equipment, net (note 4)                                                                     |                                                                                                   |                                                                                                             | 1,385  |                            |        |              | 1,861  |             
|Deferred
income taxes, net of valuation allowances of $3,353
and $1,044 in 2001 and 2000, respectively (note 9) |                                                                                                   |                                                                                                             | 1,962  |                            |        |              | 105    |             
|Intangible assets, net (note 5)                                                                                 |                                                                                                   |                                                                                                             | 1,335  |                            |        |              | 4,576  |             
|Net assets of discontinued operations (note 2)                                                                  |                                                                                                   |                                                                                                             | 261    |                            |        |              | 274    |             
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   | $                                                                                                           | 17,212 |                            |        |              | 24,759 |             
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|Liabilities and Stockholders Equity                                                                            |                                                                                                   |                                                                                                             |        |                            |        |             
|Current liabilities:                                                                                            |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                | Accounts payable                                                                                  |                                                                                                             | $      | 326                        |        |              |        | 487          |       
|                                                                                                                | Accrued expenses and other current liabilities (note 6)                                           |                                                                                                             |        | 2,615                      |        |              |        | 4,635        |       
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             |        | Total current liabilities  |        |              | 2,941  |              |        |   | 5,122  | 
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|Long-term debt (note 7)                                                                                         |                                                                                                   |                                                                                                             |       |                            |        |              |       |             
|Other liabilities                                                                                               |                                                                                                   |                                                                                                             | 8      |                            |        |              | 452    |             
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             |        | Total liabilities          |        |              | 2,949  |              |        |   | 5,574  | 
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|Commitments and contingencies (notes 2, 12 and 13)                                                              |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|Stockholders equity :                                                                                          |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   | Preferred
stock of $.05 par value. Authorized
500,000 shares, none issued                                   |        |                            |       |              |        |              |       |  
|                                                                                                                |                                                                                                   | Common
stock of $.05 par value. Authorized
7,500,000 shares; issued 3,293,405 shares for
both 2001 and 2000 |        |                            | 165    |              |        |              | 165    |  
|                                                                                                                |                                                                                                   | Additional paid-in capital                                                                                  |        |                            | 4,936  |              |        |              | 4,914  |  
|                                                                                                                |                                                                                                   | Less unearned restricted stock                                                                              |        |                            | (108   | )            |        |              | (215   | )
|                                                                                                                |                                                                                                   | Less notes receivable from stock sale                                                                       |        |                            | (22    | )            |        |              | (235   | )
|                                                                                                                |                                                                                                   | Retained earnings                                                                                           |        |                            | 11,048 |              |        |              | 16,168 |  
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             | 16,019 |                            |        |              | 20,797 |             
|                                                                                                                |                                                                                                   | Less
cost of common shares in treasury  387,239 and
356,791 shares for 2001 and 2000, respectively         |        |                            | (1,756 | )            |        |              | (1,612 | )
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   |                                                                                                             |        | Total stockholders equity |        |              | 14,263 |              |        |   | 19,185 | 
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             
|                                                                                                                |                                                                                                   | $                                                                                                           | 17,212 |                            |        |              | 24,759 |             
|                                                                                                                |                                                                                                   |                                                                                                             |        |                            |        |              |        |             

See accompanying notes to financial statements.

16



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##### 



ABLEST INC.




Statements of Operations

(In thousands, except share
data)


|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |        |         |  
|------------------------------------------------------------------------ | -------------------------------------------------------------------------- | -------------------------------------------------------------- | --------- | ------------ | ------ | ------------ | --------- | ------------ | ------ |  | --------- | ------ | ------- | -
|                                                                         |                                                                            |                                                                |           | December 30, |        | December 31, |           | December 26,
|                                                                         |                                                                            |                                                                |           | 2001         |        | 2000         |           | 1999        
|                                                                         |                                                                            |                                                                |           |              |        |              |           |             
|Net service revenues                                                     |                                                                            | $                                                              | 87,042    |              |        |              | 103,435   |              |        |  | 98,094    |       
|Cost of services                                                         |                                                                            |                                                                | 70,086    |              |        |              | 80,601    |              |        |  | 75,885    |       
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | Gross profit                                                   |           |              | 16,956 |              |           |              | 22,834 |  |           |        | 22,209  |  
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|Selling, general and administrative expenses                             |                                                                            |                                                                | 19,399    |              |        |              | 21,275    |              |        |  | 19,873    |       
|Amortization of intangible assets                                        |                                                                            |                                                                | 323       |              |        |              | 366       |              |        |  | 724       |       
|Intangible asset impairment (note 5)                                     |                                                                            |                                                                | 2,908     |              |        |              |          |              |        |  | 5,071     |       
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | Operating (loss) income                                        |           |              | (5,674 | )            |           |              | 1,193  |  |           |        | (3,459  | )
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|Other income (expense):                                                  |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         | Interest income (expense), net                                             |                                                                |           | 21           |        |              |           | (135         | )      |  |           | (599   | )      
|                                                                         | Miscellaneous, net                                                         |                                                                |           | 73           |        |              |           | 149          |        |  |           | 170    |        
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | Other income (expense), net                                    |           |              | 94     |              |           |              | 14     |  |           |        | (429    | )
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | (Loss) earnings from continuing operations
before income taxes |           |              | (5,580 | )            |           |              | 1,207  |  |           |        | (3,888  | )
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|Income tax (benefit) expense (note 9)                                    |                                                                            |                                                                | (460      | )            |        |              | 615       |              |        |  | 68        |       
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | Net (loss) earnings from continuing operations                 |           |              | (5,120 | )            |           |              | 592    |  |           |        | (3,956  | )
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|Discontinued operations (note 2):                                        |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         | (Loss) income from discontinued operations, net
of income taxes            |                                                                |           |             |        |              |           |             |        |  |           | (743   | )      
|                                                                         | Loss on sale of discontinued operations,
net of income taxes               |                                                                |           |             |        |              |           |             |        |  |           | (7,086 | )      
|                                                                         | Adjustment to loss on sale of discontinued
operations, net of income taxes |                                                                |           |             |        |              |           | 185          |        |  |           |       |        
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | Net (loss) earnings                                            |           | $            | (5,120 | )            |           |              | 777    |  |           |        | (11,785 | )
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|Basic and diluted (loss) earnings per common share:                      |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         | Continuing operations                                                      |                                                                | $         | (1.75        | )      |              |           | .21          |        |  |           | (1.37  | )      
|                                                                         | Discontinued operations                                                    |                                                                |           |             |        |              |           |             |        |  |           | (.26   | )      
|                                                                         | Loss on sale of discontinued operations                                    |                                                                |           |             |        |              |           |             |        |  |           | (2.46  | )      
|                                                                         | Adj. to loss on sale of discontinued operations                            |                                                                |           |             |        |              |           | .06          |        |  |           |       |        
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|                                                                         |                                                                            | Basic and diluted (loss) earnings per
common share:            |           | $            | (1.75  | )            |           |              | .27    |  |           |        | (4.09   | )
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       
|Weighted average number of common
shares outstanding  basic and diluted |                                                                            |                                                                | 2,922,246 |              |        |              | 2,865,844 |              |        |  | 2,880,867 |       
|                                                                         |                                                                            |                                                                |           |              |        |              |           |              |        |  |           |       

See accompanying notes to financial statements.

17



---



##### 



ABLEST INC.




Statements of Stockholders Equity

(In thousands, except share
data)


|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|-------------------------------- |  | ------ | --- | ------- |  | ---------- | ----- | ------ |  | ---------- | ------- | -------------- |  | ------------- | ------- | ---------- |  | ----- | ------ | - |  |  | ---- | - |  |  | ---- | - |  | - | ------- | -
|                                 |  |        |     |         |  | Additional |       |        |  |            |         | Treasury stock |  | Unearned      |         | Receivable |  | Total
|                                 |  | Common |     | paid-in |  | Retained   |       |        |  | restricted |         | from stock     |  | stockholders'
|                                 |  | stock  |     | capital |  | earnings   |       | Shares |  | Amounts    |         | stock          |  | sale          |         | equity    
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |           
|Balances at December 27, 1998    |  | $      | 158 |         |  |            | 4,278 |        |  | $          | 27,176  |                |  |               | 288,754 |            |  | $     | (1,236 | ) |  |  |     |   |  |  |     |   |  | $ | 30,376  |  
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|Net loss                         |  |        |    |         |  |            |      |        |  |            | (11,785 | )              |  |               |        |            |  |       |       |   |  |  |     |   |  |  |     |   |  |   | (11,785 | )
|Stock compensation awards        |  |        |    |         |  |            | 7     |        |  |            |        |                |  |               | (3,225  | )          |  |       | 14     |   |  |  |     |   |  |  |     |   |  |   | 21      |  
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|Balances at December 26, 1999    |  |        | 158 |         |  |            | 4,285 |        |  |            | 15,391  |                |  |               | 285,529 |            |  |       | (1,222 | ) |  |  |     |   |  |  |     |   |  |   | 18,612  |  
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|Net earnings                     |  |        |    |         |  |            |      |        |  |            | 777     |                |  |               |        |            |  |       |       |   |  |  |     |   |  |  |     |   |  |   | 777     |  
|Stock options exercised          |  |        | 1   |         |  |            | 77    |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  |     |   |  |  |     |   |  |   | 78      |  
|Stock compensation awards        |  |        | 3   |         |  |            | 320   |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  | (215 | ) |  |  |     |   |  |   | 108     |  
|Stock repurchase program         |  |        |    |         |  |            |      |        |  |            |        |                |  |               | 71,262  |            |  |       | (390   | ) |  |  |     |   |  |  |     |   |  |   | (390    | )
|Option to ownership program      |  |        | 3   |         |  |            | 232   |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  |     |   |  |  |     |   |  |   | 235     |  
|Notes receivable from stock sale |  |        |    |         |  |            |      |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  |     |   |  |  | (235 | ) |  |   | (235    | )
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|Balances at December 31, 2000    |  |        | 165 |         |  |            | 4,914 |        |  |            | 16,168  |                |  |               | 356,791 |            |  |       | (1,612 | ) |  |  | (215 | ) |  |  | (235 | ) |  |   | 19,185  |  
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|Net loss                         |  |        |    |         |  |            |      |        |  |            | (5,120  | )              |  |               |        |            |  |       |       |   |  |  |     |   |  |  |     |   |  |   | (5,120  | )
|Stock compensation awards        |  |        |    |         |  |            |      |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  | 107  |   |  |  |     |   |  |   | 107     |  
|Stock repurchase program         |  |        |    |         |  |            |      |        |  |            |        |                |  |               | 30,448  |            |  |       | (144   | ) |  |  |     |   |  |  |     |   |  |   | (144    |  
|Option to ownership program      |  |        |    |         |  |            | 22    |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  |     |   |  |  |     |   |  |   | 22      |  
|Notes receivable from stock sale |  |        |    |         |  |            |      |        |  |            |        |                |  |               |        |            |  |       |       |   |  |  |     |   |  |  | 213  |   |  |   | 213     |  
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  
|Balances at December 30,2001     |  | $      | 165 |         |  |            | 4,936 |        |  | $          | 11,048  |                |  |               | 387,239 |            |  | $     | (1,756 | ) |  |  | (108 | ) |  |  | (22  | ) |  | $ | 14,263  |  
|                                 |  |        |     |         |  |            |       |        |  |            |         |                |  |               |         |            |  |       |        |   |  |  |      |   |  |  |      |   |  |   |         |  

See accompanying notes to financial statements.

18



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##### 



ABLEST INC.




Statements of Cash Flows

(In thousands)


|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |        |         |        |  
|------------------------------------------------------------ | ---------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------- | -------------------------------------------------------- | ---- | ------------ | ----- | ------------ | ------ | ------------ | ------ | ------ | ------ | ------- | ------ | -
|                                                             |                                                                              |                                                                                                       |                                                          |      | December 30, |       | December 31, |        | December 26,
|                                                             |                                                                              |                                                                                                       |                                                          |      | 2001         |       | 2000         |        | 1999        
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |             
|Cash flows from operating activities:                        |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|                                                             |                                                                              | Net (loss) earnings from continuing operations                                                        |                                                          | $    | (5,120       | )     |              |        | 592          |        |        |        | (3,956  | )     
|                                                             |                                                                              | Adjustments to reconcile net (loss) earnings to net
cash provided by  (used in) operating activities: |                                                          |      |              |       |              |        |              |        |        |        |         |       
|                                                             |                                                                              |                                                                                                       | Depreciation                                             |      |              | 904   |              |        |              | 1,151  |        |        |         | 684    |  
|                                                             |                                                                              |                                                                                                       | Amortization of intangible assets                        |      |              | 323   |              |        |              | 366    |        |        |         | 724    |  
|                                                             |                                                                              |                                                                                                       | Intangible asset impairment                              |      |              | 2,908 |              |        |              |       |        |        |         | 5,071  |  
|                                                             |                                                                              |                                                                                                       | (Gain) on disposal of property, plant and
equipment, net |      |              | 199   |              |        |              | (98    | )      |        |         |       |  
|                                                             |                                                                              |                                                                                                       | Deferred income taxes                                    |      |              | (501  | )            |        |              | (645   | )      |        |         | (778   | )
|                                                             |                                                                              |                                                                                                       | Stock compensation                                       |      |              | 320   |              |        |              | 108    |        |        |         |       |  
|                                                             |                                                                              |                                                                                                       | Changes in assets and liabilities (next page)            |      |              | 1,904 |              |        |              | (4,950 | )      |        |         | (1,013 | )
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|                                                             | Net cash provided by (used in) operating activities of
continuing operations |                                                                                                       |                                                          | 937  |              |       |              | (3,476 | )            |        |        | 732    |        
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|Cash flows from investing activities:                        |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|                                                             |                                                                              | Additions to property, plant and equipment                                                            |                                                          |      | (627         | )     |              |        | (1,040       | )      |        |        | (996    | )     
|                                                             |                                                                              | Proceeds from disposal of property, plant and
equipment                                               |                                                          |      |             |       |              |        | 366          |        |        |        |        |       
|                                                             |                                                                              | Acquisitions and earnout payments, net of cash
acquired                                               |                                                          |      |             |       |              |        | (225         | )      |        |        | (1,310  | )     
|                                                             |                                                                              | Cash transfer from discontinued operations (Note 2 )                                                  |                                                          |      | 13           |       |              |        | 8,683        |        |        |        |        |       
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |        |         |       
|                                                             | Net cash (used in) provided by investing activities of
continuing operations |                                                                                                       |                                                          | (614 | )            |       |              | 7,784  |              |        |        | (2,306 | )      
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|Cash flows from financing activities:                        |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|                                                             |                                                                              | Proceeds from bank line of credit borrowings                                                          |                                                          |      | 1,200        |       |              |        | 6,200        |        |        |        | 18,750  |       
|                                                             |                                                                              | Repayment of bank line of credit borrowings                                                           |                                                          |      | (1,200       | )     |              |        | (15,200      | )      |        |        | (18,350 | )     
|                                                             |                                                                              | Proceeds from exercise of stock options                                                               |                                                          |      |             |       |              |        | 78           |        |        |        |        |       
|                                                             |                                                                              | Employee stock awards                                                                                 |                                                          |      | 22           |       |              |        |             |        |        |        |        |       
|                                                             |                                                                              | Purchase of treasury shares                                                                           |                                                          |      | (144         | )     |              |        | (390         | )      |        |        |        |       
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|                                                             | Net cash (used in) provided by financing activities
of continuing operations |                                                                                                       |                                                          | (122 | )            |       |              | (9,312 | )            |        |        | 400    |        
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|Net increase (decrease) in cash from continuing operations   |                                                                              |                                                                                                       | 201                                                      |      |              |       | (5,004       | )      |              |        | (1,174 | )     
|Net (decrease) increase in cash from discontinued
operations |                                                                              |                                                                                                       | 13                                                       |      |              |       | 13,531       |        |              |        | 414    |       
|Less amount transferred to continuing operations             |                                                                              |                                                                                                       | (13                                                      | )    |              |       | (8,683       | )      |              |        |       |       
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|Net increase (decrease) in cash and cash equivalents         |                                                                              |                                                                                                       | 201                                                      |      |              |       | (156         | )      |              |        | (760   | )     
|Cash and cash equivalents at beginning of year               |                                                                              |                                                                                                       | 406                                                      |      |              |       | 562          |        |              |        | 1,322  |       
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       
|Cash and cash equivalents at end of year                     |                                                                              | $                                                                                                     | 607                                                      |      |              |       | 406          |        |              |        | 562    |       
|                                                             |                                                                              |                                                                                                       |                                                          |      |              |       |              |        |              |        |        |       

(Continued)

See accompanying notes to financial statements.

19



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##### 



ABLEST INC.

Statements of Cash Flows, continued
(In thousands)

|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |   |  |  |         |  
|------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------ | -------------------------- | ------------------------ | ---------------------------------------------- |  | ------------ | ------- | ------------ |  | ------------ | ------- | - |  |  | ------- | -
|                                                                                                                   |                                                                          |                            |                          |                                                |  | December 30, |         | December 31, |  | December 26,
|                                                                                                                   |                                                                          |                            |                          |                                                |  | 2001         |         | 2000         |  | 1999        
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |             
|Changes in continuing operations assets and liabilities
providing (using) cash excluding effects of acquisitions: |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   |                                                                          |                            |                          | Receivables                                    |  | $            | 4,397   |              |  |              | (1,137  | ) |  |  | (3,663  | )
|                                                                                                                   |                                                                          |                            |                          | Prepaid expenses & other                       |  |              | 122     |              |  |              | 60      |   |  |  | (162    | )
|                                                                                                                   |                                                                          |                            |                          | Accounts payable                               |  |              | (161    | )            |  |              | (981    | ) |  |  | 1,155   |  
|                                                                                                                   |                                                                          |                            |                          | Accrued expenses and other current liabilities |  |              | (2,020  | )            |  |              | (2,588  | ) |  |  | 1,347   |  
|                                                                                                                   |                                                                          |                            |                          | Deposits                                       |  |              | 10      | )            |  |              | (17     | ) |  |  | 15      |  
|                                                                                                                   |                                                                          |                            |                          | Other assets & liabilities                     |  |              | (444    | )            |  |              | (287    | ) |  |  | 295     |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   |                                                                          |                            |                          | Total                                          |  | $            | 1,904   |              |  |              | (4,950  | ) |  |  | (1,013  | )
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|Supplemental disclosures of cash flow information:                                                                 |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   |                                                                          | Cash paid during year for: |                          |                                                |  |              |         |              |  |              |         |   |  | 
|                                                                                                                   |                                                                          |                            |                          | Interest
 continuing operations               |  | $            | 12      |              |  |              | 135     |   |  |  | 307     |  
|                                                                                                                   |                                                                          |                            |                          | Interest  discontinued operations             |  |              |        |              |  |              | 198     |   |  |  | 325     |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |   |  |  |         |  
|                                                                                                                   |                                                                          | $                          | 12                       |                                                |  |              | 333     |              |  |              | 632     |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   |                                                                          |                            |                          | Income taxes  continuing operations           |  | $            |        |              |  |              |        |   |  |  | 117     |  
|                                                                                                                   |                                                                          |                            |                          | Income taxes  discontinued operations         |  |              |        |              |  |              |        |   |  |  | 288     |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |   |  |  |         |  
|                                                                                                                   |                                                                          | $                          |                         |                                                |  |              |        |              |  |              | 405     |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   |                                                                          |                            | Bank line of credit:     |                                                |  |              |         |              |  |              |         |   |  |  |        
|                                                                                                                   |                                                                          |                            |                          | Proceeds  continuing operations               |  | $            | 1,200   |              |  |              | 6,200   |   |  |  | 18,750  |  
|                                                                                                                   |                                                                          |                            |                          | Proceeds  discontinued operations             |  |              |        |              |  |              | 5,250   |   |  |  | 12,400  |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |   |  |  |         |  
|                                                                                                                   |                                                                          | $                          | 1,200                    |                                                |  |              | 11,450  |              |  |              | 31,150  |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   |                                                                          |                            |                          | Repayments  continuing operations             |  | $            | (1,200  | )            |  |              | (15,200 | ) |  |  | (18,350 | )
|                                                                                                                   |                                                                          |                            |                          | Repayments  discontinued operations           |  |              |        |              |  |              | (11,900 | ) |  |  | (12,900 | )
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |   |  |  |         |  
|                                                                                                                   |                                                                          | $                          | (1,200                   | )                                              |  |              | (27,100 | )            |  |              | (31,250 | )
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  
|                                                                                                                   | Supplemental disclosures of non-cash investing and
financing activities: |                            |                          |                                                |  |              |         |              |  |              |         |   | 
|                                                                                                                   |                                                                          |                            | Discontinued operations: |                                                |  |              |         |              |  |              |         |   |  |  |        
|                                                                                                                   |                                                                          |                            |                          | Leases capitalized                             |  | $            |        |              |  |              |        |   |  |  | 1,148   |  
|                                                                                                                   |                                                                          |                            |                          |                                                |  |              |         |              |  |              |         |  

See accompanying notes to financial statements.

20



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##### 



ABLEST INC.




Notes to Financial Statements

Years ended December 30, 2001, December 31, 2000
and December 26, 1999

(1) Summary of Significant Accounting Policies

Ablest Inc. (the Company) is primarily engaged in staffing services
principally in the Eastern United States and selected Southwestern markets. On
January 1, 2001, the Companys two operating subsidiaries, Ablest Service Corp.
and Milestone Technologies Inc. merged into Ablest Inc. to create a single
operating entity. The two operating divisions of the Company are Ablest
Staffing Services, which focuses on providing temporary and contract staffing
solutions to businesses in the clerical and light industrial sectors, and
Ablest Technology Services, which focuses on providing information technology
staffing services to all businesses.

Prior to March 13, 2000 the Company also provided industrial maintenance
services through C. H. Heist Corp. domestically and in Canada through C. H.
Heist Ltd., a wholly owned subsidiary. As further described in note 2, the
Company sold substantially all of the assets of its industrial maintenance
operations on March 13, 2000, including the stock of C. H. Heist, Ltd. to Onyx
Industrial Services, Inc. The accompanying financial statements as of and for
the years ended December 31, 2000 and December 26, 1999 separately reflect
industrial maintenance operations as a discontinued operation.

On March 6, 2000, the shareholders approved an Agreement and Plan of Merger
(the Merger Agreement) effecting a re-incorporation (the Re-incorporation)
of C.H. Heist Corp. by merger into Ablest Inc., a Delaware corporation
(Delaware Company) formed for the Re-incorporation and as a result, C.H. Heist
Corp.s name was changed to Ablest Inc. The Re-incorporation was effective
upon the filing of related documentation in Delaware and New York after the
consummation of the purchase agreement with Onyx, all of which occurred on
March 13, 2000.

Upon completion of the merger, (i) C.H. Heist Corp. ceased to exist, (ii) the
Delaware Company continued to operate the business of the Company under the
name Ablest Inc., (iii) the shareholders of the Company automatically became
the shareholders of the Delaware Company, (iv) the business is governed under
the laws of Delaware rather than New York, (v) options to purchase common
shares of the Company automatically converted into options to acquire an equal
number of shares of the Delaware Companys common stock, and (vi) no change
occurred in the business, management, assets, liabilities or net worth of the
Company as such existed immediately following consummation of the purchase
agreement with Onyx.

Each outstanding common share of the Company, $.05 par value, automatically
converted pro-rata into one share of the Delaware Company common stock, $.05
par value. The Delaware Companys bylaws and charter authorize the issuance of
7,500,000 shares of common stock and 500,000 shares of preferred stock.

On January 1, 2001, the Companys subsidiaries Ablest Service Corp. (a Delaware
corporation), Milestone Technologies, Inc. (an Arizona corporation) and PLP
Corp. (an Alabama corporation) were formally merged into Ablest Inc. (a
Delaware corporation), to form a single operating company under the Ablest Inc.
name. The outstanding shares of the merging corporations were cancelled and no
shares of Ablest Inc. were issued in exchange. The outstanding shares of Ablest
Inc. remain outstanding and were not affected by the merger.

21



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

Significant accounting policies followed by the Company are summarized on the
following page.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Fiscal Year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | The Companys fiscal year ends on the last Sunday of December. The
financial statements include 52 weeks for the years ended December 30,
2001 and December 26, 1999 and 53 weeks for the year ended December 31,
2000.                                                                                                                                                                                                                                                                                                                            
|
| | (b) Principles of Consolidation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | Prior to the merger of the Companys subsidiaries on January 1, 2001, the
Company reported their operations on a consolidated basis. The
consolidated financial statements included the accounts of the Company
and its subsidiaries, all of which were wholly-owned. All significant
intercompany balances and transactions were eliminated in consolidation.                                                                                                                                                                                     
|
| | (c) Cash Equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | All highly liquid investments with original maturities of three months or
less are considered cash equivalents. There were no cash equivalents at
December 30, 2001 and December 31, 2000.                                                                                                                                                                                                                                                                                                                                                         
|
| | (d) Revenue Recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | Revenue and associated costs are recognized in the period the services
are provided. In December 1999, the United States Securities and Exchange
Commissions (SEC) issued Staff Accounting Bulletin (SAB) 101, Revenue
Recognition, which summarizes certain of the SEC staff views in applying
generally accepted accounting principles to revenue recognition in
financial statements. The Companys revenue recognition policies comply
with SAB 101 and, therefore, adoption of SAB 101 had no impact on the
Companys financial statements.
|
| | (e) Property, Plant and Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | Property, plant and equipment are recorded at cost and are depreciated
over the estimated useful lives of the respective assets on the
straight-line method. Leasehold improvements are amortized on the
straight-line method over the shorter of the lease term or estimated
useful life of the asset. Estimated useful lives generally range from
three to forty years.                                                                                                                                                                          
|
| | Expenditures for maintenance and repairs are charged to expense as
incurred. Additions and major replacements or betterments that increase
capacity or extend useful lives are added to the cost of the asset. Upon
sale or retirement of the asset, the cost and accumulated depreciation
are eliminated from the respective accounts and the resulting gain or
loss is included in other income (expense), net in the accompanying
statements of operations.                                                                                     
|
| | (f) Intangible Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| | Intangible assets, which represent the excess of acquisition cost over
the fair market value of identified net assets acquired in business
combinations accounted for as purchases, are amortized using the
straight-line method over three to thirty years. In June 2001, the
Financial Accounting Standards Board (FASB) issued Statement of
Accounting Standards (SFAS) No. 142, Goodwill and Other Intangible
Assets. See section (m) Recently Issued Accounting Pronouncements
below.                                                     

22



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (f) Intangible Assets (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | In accordance with SFAS No. 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of, the
Company evaluates the recoverability of its long-lived assets whenever
events or changes in circumstance indicate that the carrying amount may
not be recoverable. If indications are that the carrying amount of the
asset may not be recoverable, the Company will estimate the future cash
flows expected to result from use of the asset and its eventual
disposition. If the sum of the expected future cash flows (non-discounted
and without interest charges) is less than the carrying amount of the
asset, the Company would recognize an impairment loss. The impairment loss recognized would be measured as the amount by which
the carrying amount of the asset exceeds its estimated fair value. The
estimation of fair value is generally measured by discounting expected
future cash flows.
|
| | (g) Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | Income taxes are accounted for by the asset and liability method. Under
the asset and liability method, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to operating loss
and credit carryforwards and differences between the financial statement
carrying amounts of existing assets and liabilities and their respective
tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or
settled. The effect on deferred tax assets and liabilities of a change in
tax rates is recognized as income or expense in the period that includes
the enactment date.                                                                                                                                                                                        
|
| | (h) (Loss) Earnings Per Common Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | Basic (loss) earnings per common share is computed by using the weighted
average number of common shares outstanding. Diluted (loss) earnings per
share is computed by using the weighted average number of common shares
outstanding plus the dilutive effect, if any, of stock options. The
effect of all unexercised stock options determined under the treasury
method was anti-dilutive and therefore (loss) earnings per
common share  basic and diluted was the same for the years ended December 30, 2001,
December 31, 2000 and December 26, 1999.                                                                                                                                                                                                                                                                                                                                                                                        
|
| | (i) Foreign Currency Translation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | The former Canadian subsidiary utilized the Canadian dollar as its
functional currency. Assets and liabilities were translated using rates
of exchange as of the balance sheet date at the time of the sale and the
statements of operations were translated at an average rate of exchange
through March 12, 2000. The cumulative effect of foreign currency
translation is included in the net assets of discontinued operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | (j) Use of Estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | The preparation of financial statements in conformity with accounting
principals generally accepted in the United States requires management to
make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenue
and expenses during the reporting period. Actual results could differ
from those estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

23



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (k) Stock Option Plans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | The Company applies the intrinsic value-based method of accounting
prescribed by Accounting Principles Board (APB) Opinion No. 25,
Accounting for Stock Issued to Employees, and related interpretations,
in accounting for its fixed plan stock options. As such, compensation
expense would be recorded on the date of the grant if the current market
price of the underlying stock exceeded the exercise price. Statement of
Financial Accounting Standards No. 123 (SFAS No. 123) Accounting for
Stock  Based Compensation, established accounting and disclosure
requirements using a fair value-based method of accounting for
stock-based employee compensation plans. As allowed by SFAS No. 123, the
Company has elected to continue to apply the intrinsic value-based method
of accounting described above, and has adopted the disclosure
requirements of SFAS No. 123.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | (l) Fair Value of Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| | The carrying amounts of the Companys financial instruments, including
cash and cash equivalents, receivables, accounts payable and accrued
liabilities, approximate fair value because of their short maturities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (m) Recently Issued Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | In July 2001, the Financial Accounting Standards Board issued
Statements of Financial Accounting Standards No. 141 (SFAS No.
141), Business Combinations, and No. 142 (SFAS No. 142),
Goodwill and Other Intangible Assets. SFAS No. 141 addresses
financial accounting and reporting for goodwill and other intangible
assets acquired in a business combination at acquisition. SFAS No.
141 requires the purchase method of accounting to be used for all
business combinations initiated after June 30, 2001; establishes
specific criteria for the recognition of intangible assets separately
from goodwill; and requires unallocated negative goodwill to be
written off immediately as an extraordinary gain. SFAS No.142
addresses financial accounting and reporting for intangible assets
acquired individually or with a group of other assets at acquisition.
SFAS No. 142 also addresses financial accounting and reporting for
goodwill and other intangible assets subsequent to their acquisition.
SFAS No. 142 provides that goodwill and intangible assets that have
indefinite useful lives will not be amortized but rather will be
tested at least annually for impairment. It also provides that
intangible assets that have finite useful lives will continue to be
amortized over their useful lives, but those lives will no longer be
limited to forty years. SFAS No. 141 is effective for all business
combinations initiated after June 30, 2001. The provisions of SFAS
No. 142 are effective for fiscal years beginning after December 15,
2001. The Company will adopt SFAS No. 142 beginning January 1, 2002.
The Company is in the process of completing its step one transition
assessment of intangible assets. However, it does not currently
anticipate having to record an impairment of intangible assets as a
cumulative effect as a result of these new standards.
|
| | In August 2001, the FASB issued SFAS No. 143, Accounting for Asset
Retirement Obligations that applies to legal obligations associated with
the retirement of a tangible long-lived asset that results from the
acquisition, construction, or development and/or the normal operation of
a long-lived asset. Under this standard, guidance is provided on
measuring and recording the liability. The provisions of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

24



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (m) Recently Issued Accounting Pronouncements (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | SFAS 143 are effective for financial statements issued for fiscal years
beginning after June 15, 2002. The Company is in the process of
evaluating the impact that adoption of SFAS No. 143 may have on the
Companys financial position, cash flows or results of operations.
However, such impact, if any, is not known or reasonably estimable at
this time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | In August 2001, the FASB issued SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets. SFAS No. 144 addresses
financial accounting and reporting for the impairment or disposal of
long-lived assets. While SFAS No. 144 supercedes SFAS No. 121, Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of it removes goodwill from its scope and retains the
requirements of SFAS No. 121 regarding the recognition of impairment
losses on long-lived assets held for use. SFAS No. 144 also supercedes the
accounting and reporting provisions of APB Opinion No. 30, Reporting the
Results of Operations-Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring events and
Transactions for the disposal of a segment of a business. However, it
retains the requirement in Opinion 30 to report separately discontinued
operations and extends that reporting to a component of an entity that
either has been disposed of (by sale, abandonment, or in a distribution to
owners) or is classified as held for sale. SFAS No. 144 is effective for
fiscal years beginning after December 15, 2001 and interim periods within
those fiscal years. The provisions of this Statement are effective for
financial statements issued for fiscal years beginning after December 15,
2001, and interim periods within those fiscal years. The Company is in the
process of evaluating the impact that adoption of SFAS No. 144 may have on
the Companys financial position, cash flows or results of operations.
However, such impact, if any, is not known or reasonably estimable at this
time.

(2) Discontinued Operations

In the fourth quarter of 1999 the Company adopted a plan to dispose of its
industrial maintenance operations. On March 13, 2000, the Company completed the
sale of substantially all of the assets of the Companys U.S. industrial
maintenance operations and all the stock of its Canadian subsidiary, C. H.
Heist, Ltd., to Onyx. Taken together, these operations comprised substantially
all of the Companys industrial maintenance business. The base selling price
was $20,000,000 in cash plus the assumption by Onyx of certain trade
liabilities. The selling price was subject to adjustment in the event that the
net assets delivered differ from a targeted amount agreed to by the parties.
Additionally, $7,000,000 of the selling price was subject to escrow pending the
formal assignment of certain customer relationships to Onyx. Of the amount
held in escrow, $6,000,000 was attributable to one customer relationship.
Prior to closing the sale to Onyx on March 13, 2000, the Company obtained the
necessary assignment from this customer thereby releasing the proceeds. Based
upon the 2000 activity of the other customer assignments with Onyx, $327,000 of
the remaining escrow was not received and, accordingly, the Company excluded
such amounts from the estimated sales price in determining the loss on disposal
of this business.

The Asset Sale and Purchase Agreement between C. H. Heist Corp. and Onyx (the
Agreement) included certain other provisions, which resulted in additional
disposition costs for the Company. Such costs included environmental
remediation at certain specific industrial maintenance branches, reimbursement
of any uncollectible accounts receivable acquired by Onyx and the payment of
certain severance costs. The Company

25



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(2) Discontinued Operations (continued)

estimated and recorded in 1999, its net loss from the sale of its industrial
maintenance operations. Such loss included managements best estimate of the
sale proceeds, the direct costs of the transaction, estimated costs associated
with the contingencies contained in the Agreement and the basis of disposed net
assets as of the measurement date. The actual amounts for these items and
accordingly, the actual loss from disposal may differ from the estimate.

The estimated loss on the disposal of the industrial maintenance operations
recorded in 1999 was $7,086,000 (net of tax benefit of $2,772,000), consisting
of an estimated loss on disposal of the business of $5,509,000 and a provision
of $1,577,000 for anticipated operating losses from the measurement date to the
expected disposal in March, 2000 (holding period loss). During fiscal 2000, an
adjustment was made to reduce the loss on disposal by $185,000, net of taxes.
The adjustment was based on the difference between the actual operating results
of the discontinued operations during the holding period and the estimate used
in the determination of the loss on sale of discontinued operations recorded in
1999. In July 2001, a final settle-up of remaining outstanding items from the
Agreement resulted in an additional net payment of approximately $497,000 to
Onyx. There are no known, outstanding items with Onyx and management believes
no additional adjustments to the loss on disposal are required.

A summary of the operating results of discontinued operations are shown below:

|                                                                               |  |              |   |              |  |              |        |  |  |  |        |  
|------------------------------------------------------------------------------ |  | ------------ | - | ------------ |  | ------------ | ------ |  |  |  | ------ | -
|                                                                               |  | December 30, |   | December 31, |  | December 26,
|(In
thousands)                                                                 |  | 2001         |   | 2000         |  | 1999        
|                                                                               |  |              |   |              |  |             
|Net service revenues                                                           |  | $            |  |              |  |              | 12,565 |  |  |  | 54,317 |  
|                                                                               |  |              |   |              |  |              |        |  |  |  |        |  
|Income (loss) from discontinued operations
before income tax expense (benefit) |  |              |  |              |  |              | 309    |  |  |  | (979   | )
|Income tax expense (benefit)                                                   |  |              |  |              |  |              | 124    |  |  |  | (236   | )
|                                                                               |  |              |   |              |  |              |        |  |  |  |        |  
|Income (loss) from discontinued operations                                     |  | $            |  |              |  |              | 185    |  |  |  | (743   | )
|                                                                               |  |              |   |              |  |              |        |  |  |  |        |  

The Company specifically allocated debt and interest expense that it attributed
to each operating business segment. The amount of interest expense included in
the income (loss) from discontinued operations was $198,000 and $325,000 for
the years ended December 31, 2000 and December 26, 1999, respectively.

Comprehensive loss of these operations was $216,000 and $266,000 for the years
ended December 31, 2000 and December 26, 1999, respectively. The only item of
other comprehensive loss is foreign currency translation.

The income tax expense (benefit) attributable to discontinued operations
differs from the amount determined by applying the statutory federal tax rate
to income (loss) from discontinued operations before income taxes due to the
effects of higher foreign tax rates, net operating loss and tax credit
carryforwards and state taxes.

26



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(2) Discontinued Operations (continued)

The industrial maintenance assets sold, the liabilities assumed by Onyx, the
cumulative translation adjustment attributable to C.H. Heist, Ltd. and the
accrued loss on sale have been segregated in the accompanying balance sheets as
net assets of discontinued operations. The components of which are shown
below:

|                                          |  |              |      |              |  |  |        |  
|----------------------------------------- |  | ------------ | ---- | ------------ |  |  | ------ | -
|                                          |  | December 30, |      | December 31,
|(In thousands)                            |  | 2001         |      | 2000        
|                                          |  |              |      |             
|Current assets                            |  | $            | 586  |              |  |  | 576    |  
|Property, plant & equipment, net (note 4) |  |              |     |              |  |  | 699    |  
|Accrued loss on disposal                  |  |              | (325 | )            |  |  | (1,001 | )
|                                          |  |              |      |              |  |  |        |  
|                                          |  | $            | 261  |              |  |  | 274    |  
|                                          |  |              |      |              |  |  |        |  

(3) Allowance for Doubtful Accounts

The following table sets forth the allowance for doubtful accounts roll-forward
for the past three fiscal years.

|                                       |  |              |      |              |  |              |      |   |  |  |      |  
|-------------------------------------- |  | ------------ | ---- | ------------ |  | ------------ | ---- | - |  |  | ---- | -
|                                       |  | December 30, |      | December 31, |  | December 26,
|(In thousands)                         |  | 2001         |      | 2000         |  | 1999        
|                                       |  |              |      |              |  |             
|Balance at beginning or period         |  | $            | 390  |              |  |              | 378  |   |  |  | 305  |  
|Additions charged to cost and expenses |  |              | 649  |              |  |              | 568  |   |  |  | 197  |  
|Accounts receivable written-off        |  |              | (787 | )            |  |              | (556 | ) |  |  | (124 | )
|                                       |  |              |      |              |  |              |      |   |  |  |      |  
|Balance at end of period               |  | $            | 252  |              |  |              | 390  |   |  |  | 378  |  
|                                       |  |              |      |              |  |              |      |   |  |  |      |  

(4) Property, Plant and Equipment

A summary of aggregate property, plant and equipment follows:

|                               |  |              |       |              |  |  |       | 
|------------------------------ |  | ------------ | ----- | ------------ |  |  | ----- | 
|(In thousands)                 |  | December 30, |       | December 31,
|                               |  | 2001         |       | 2000        
|                               |  |              |       |             
|Land                           |  | $            |      |              |  |  | 259   | 
|Building and improvements      |  |              |      |              |  |  | 684   | 
|Office furniture and equipment |  |              | 5,007 |              |  |  | 6,522 | 
|Leasehold improvements         |  |              | 388   |              |  |  | 362   | 
|                               |  |              |       |              |  |  |       | 
|                               |  |              | 5,395 |              |  |  | 7,827 | 
|Less accumulated depreciation  |  |              | 4,010 |              |  |  | 5,267 | 
|                               |  |              |       |              |  |  |       | 
|                               |  | $            | 1,385 |              |  |  | 2,560 | 
|                               |  |              |       |              |  |  |       | 

27



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(4) Property, Plant and Equipment (continued)

Net property, plant and equipment has been allocated as follows:

|                        |  |              |       |              |  |  |       | 
|----------------------- |  | ------------ | ----- | ------------ |  |  | ----- | 
|                        |  | December 30, |       | December 31,
|(In thousands)          |  | 2001         |       | 2000        
|                        |  |              |       |             
|Continuing operations   |  | $            | 1,385 |              |  |  | 1,861 | 
|Discontinued operations |  |              |      |              |  |  | 699   | 
|                        |  |              |       |              |  |  |       | 
|                        |  | $            | 1,385 |              |  |  | 2,560 | 
|                        |  |              |       |              |  |  |       | 

Depreciation expense for continuing operations for the years ended December 30,
2001 and December 31, 2000 was $917,000 and $1.2 million, respectively.

(5) Intangible Assets

A summary of intangible assets follows:

|                                                                          |  |              |       |              |  |  |       | 
|------------------------------------------------------------------------- |  | ------------ | ----- | ------------ |  |  | ----- | 
|(In thousands)                                                            |  | December 30, |       | December 31,
|                                                                          |  | 2001         |       | 2000        
|                                                                          |  |              |       |             
|Goodwill, less accumulated
amortization of $901 and $728                  |  | $            | 1,283 |              |  |  | 4,206 | 
|Other intangible assets, less
accumulated amortization
of $1,269 and $910 |  |              | 52    |              |  |  | 370   | 
|                                                                          |  |              |       |              |  |  |       | 
|                                                                          |  | $            | 1,335 |              |  |  | 4,576 | 
|                                                                          |  |              |       |              |  |  |       | 

In the fourth quarter of 2001, the Company recorded a pre-tax write down of
$2.9 million of intangible assets relating to its acquired information
technology staffing companies. The intangibles, primarily goodwill, were
determined to have been impaired as a result of the steady decline in revenue
and earnings, the loss of a major customer, the departure of pre-acquisition
management in the fourth quarter of 2001 and the continued weakening of demand
in this segment of the staffing industry.

In the fourth quarter of 1999, the Company recorded a pre-tax write down of
$5.1 million of intangible assets relating to the same acquired Information
technology staffing companies. The intangibles, primarily goodwill, were
determined to have been impaired due to the loss of a major customer at that
time as well as a significant decline in operating results for the acquired
companies.

28



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(6) Accrued Expenses and Other Current Liabilities

A summary of accrued expenses and other current liabilities follows:

|                               |  |              |       |              |  |  |       | 
|------------------------------ |  | ------------ | ----- | ------------ |  |  | ----- | 
|(In thousands)                 |  | December 30, |       | December 31,
|                               |  | 2001         |       | 2000        
|                               |  |              |       |             
|Payroll and other compensation |  | $            | 1,525 |              |  |  | 2,071 | 
|Insurance                      |  |              | 936   |              |  |  | 2,384 | 
|Other                          |  |              | 154   |              |  |  | 180   | 
|                               |  |              |       |              |  |  |       | 
|                               |  | $            | 2,615 |              |  |  | 4,635 | 
|                               |  |              |       |              |  |  |       | 

(7) Indebtedness

Effective January 1, 2001, the Revolving Term Loan Agreement between the
Company and Manufacturers and Traders Trust Company (M&T) dated August 21,
1995 was reduced to $5,000,000 and was set to expire on August 1, 2001. All
other terms and conditions of the original loan agreement remained unchanged.

On July 22, 2001, the Company signed a $5,000,000 Standard LIBOR Grid Note
agreement with M&T to replace the existing Revolving Term Loan Agreement with
M&T. The interest rate on borrowings under the unsecured credit facility is
elected by the Company at the time of borrowing and is either (i) the banks
prime rate or (ii) the 30, 60 or 90 day London Interbank Offered Rate (LIBOR)
plus 250 basis points (Modified LIBOR Rate). The 90 day Modified LIBOR Rate
in effect at December 30, 2001 was 4.38%. There were no outstanding balances
due on the Standard LIBOR Grid Note at December 30, 2001 nor the Revolving Term
Loan Agreement at December 31, 2000.

The Standard LIBOR Grid Note Agreement is a one-year demand note that expires
on July 21, 2002 and is renewable annually with the consent of both parties. It
does not contain working capital or other restrictive covenants.

(8) Stock Option Plans

On May 5, 2000, the Company reserved 100,000 common shares for issuance in
conjunction with its 2000 Independent Directors Stock Option Plan, (the
Directors Plan). The purpose of the Directors Plan is to strengthen the
alignment of interest between the independent directors and the shareholders of
Ablest Inc. through increased ownership by the independent directors of the
Companys common stock. The Directors Plan provides for the granting of
options to purchase 6,000 shares of common stock on the date of the respective
directors election to the Board of Directors (the Board) and for the
granting of options to purchase 1,500 common shares each time he or she is
re-elected to the Board. The price per share deliverable upon exercise is equal
to 100% of the fair market value of the shares on the date the option is
granted. The initial grant of options to purchase 6,000 common shares is
exercisable in three equal, annual installments on the first, second and third
anniversary of the grant thereof. All subsequent grants are exercisable on the
first anniversary of the grant thereof. The term of each grant is 10 years from
the date it is granted.

29



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(8) Stock Option Plans (continued)

A summary of stock option activity for the Directors Plan follows:

|                                         |  |         |        |                |  |          |      | 
|---------------------------------------- |  | ------- | ------ | -------------- |  | -------- | ---- | 
|                                         |  |         |        |                |  | Weighted
|                                         |  | Stock   |        | Average       
|                                         |  | Options |        | Exercise Price
|                                         |  |         |        |               
|Outstanding at December 26, 1999         |  |         |       |                |  |          |     | 
|Granted                                  |  |         | 24,000 |                |  | $        | 5.06 | 
|Exercised                                |  |         |       |                |  |          |     | 
|Terminated                               |  |         |       |                |  |          |     | 
|                                         |  |         |        |                |  |          |      | 
|Outstanding at December 31, 2000         |  |         | 24,000 |                |  |          | 5.06 | 
|                                         |  |         |        |                |  |          |      | 
|Granted                                  |  |         | 6,000  |                |  |          | 4.60 | 
|Exercised                                |  |         |       |                |  |          |     | 
|Terminated                               |  |         |       |                |  |          |     | 
|                                         |  |         |        |                |  |          |      | 
|Outstanding at
December 30, 2001         |  |         | 30,000 |                |  | $        | 4.97 | 
|                                         |  |         |        |                |  |          |      | 
|Options exercisable at
December 30, 2001 |  |         | 8,000  |                |  | $        | 5.06 | 
|                                         |  |         |        |                |  |          |      | 

At December 30, 2001 the range of exercise prices for options issued under the
Directors Plan was $4.60 to $5.06. The weighted average fair value of options
granted in 2001 was $2.62 and the weighted average remaining contractual life
of the outstanding options was 8.2 years.

In August 2000, the Board approved the Ablest Inc. Option to Ownership Program,
(the Program). The Program provides for the surrendering of stock options
issued under the Companys 1991 Stock Option Plan and the Companys 1996
Leveraged Stock Option Plan and the purchase of restricted common stock of the
Company through delivery of a full recourse promissory note in an amount equal
to the aggregate purchase price of the common stock issued. The per share
purchase price of the common stock issued was equal to the fair market value
of the common stock on October 9, 2000 (the effective date of the Program). The
number of common shares issued to each Program participant was based on a
conversion factor determined by calculating the fair value of the various
option grants previously issued, using the Black-Scholes Method, divided by the
fair market price of the common stock available to purchase. A total of
234,716 option shares were surrendered and 55,313 common shares issued. The
shares issued under the Program are accounted for under variable plan
accounting, as defined in SFAS No. 123. As such, additional compensation
expense of $22,000 was recorded in fiscal 2001 to reflect increase in the fair
value of the common shares issued.

The Company had reserved 375,000 common shares for issuance in conjunction with
its 1991 Stock Option Plan (the Plan). The Plan provided for the granting of
incentive stock options and/or non-qualified options to officers and key
employees to purchase shares of common stock at a price not less than the fair
market value of the stock on the dates options were granted. Such options were
exercisable at such time or times as may be determined by the Compensation
Committee of the Board and generally expired no more than ten years after
grant. Options vest and became fully exercisable six months after the grant
date. During the year ended December 30, 2001 there was no activity in the
plan. In the year ended December 31, 2000, 58,336 options
were converted to common shares under the Option to Ownership Program.

30



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(8) Stock Option Plans (continued)

A summary of stock option activity for the Plan is shown below:

|                                 |  |               |         |                |  |                  |      |                     |  |  |         | 
|-------------------------------- |  | ------------- | ------- | -------------- |  | ---------------- | ---- | ------------------- |  |  | ------- | 
|                                 |  |               |         |                |  | Weighted Average |      | Options Exercisable
|                                 |  | Stock Options |         | Exercise Price |  | at Year End     
|                                 |  |               |         |                |  |                 
|Outstanding at December 27, 1998 |  |               | 166,088 |                |  | $                | 7.69 |                     |  |  |         | 
|Canceled or expired              |  |               | (3,812  | )              |  |                  | 7.70 |                     |  |  |         | 
|                                 |  |               |         |                |  |                  |      |                     |  |  |         | 
|Outstanding at December 26, 1999 |  |               | 162,276 |                |  |                  | 7.69 |                     |  |  | 162,276 | 
|Canceled or expired              |  |               | (51,461 | )              |  |                  | 7.55 |                     |  |  |         | 
|Exercised                        |  |               | (11,000 | )              |  |                  | 7.08 |                     |  |  |         | 
|Option to Ownership Program      |  |               | (58,336 | )              |  |                  | 7.57 |                     |  |  |         | 
|                                 |  |               |         |                |  |                  |      |                     |  |  |         | 
|Outstanding at December 31, 2000 |  |               | 41,479  |                |  |                  | 8.02 |                     |  |  | 41,479  | 
|Canceled or expired              |  |               |        |                |  |                  |      |                     |  |  |         | 
|                                 |  |               |         |                |  |                  |      |                     |  |  |         | 
|Outstanding at December 30, 2001 |  |               | 41,479  |                |  | $                | 8.02 |                     |  |  | 41,479  | 
|                                 |  |               |         |                |  |                  |      |                     |  |  |         | 

At December 30, 2001 the range of exercise prices for options issued under the
Plan was $6.94 to $10.13. The weighted average remaining contractual life of
the options was 1.8 years. The remaining option grants pertain to retired,
former key employees of the company

Based on the fair value of all options at the grant date, the Companys net
(loss) earnings and (loss) earnings per common share from continuing operations
would have been reduced to the pro forma amounts indicated below:

|                                                                       |                       |             |           |   |        |              |   |              |     |              |  |  |        |        |   |  | 
|---------------------------------------------------------------------- | --------------------- | ----------- | --------- | - | ------ | ------------ | - | ------------ | --- | ------------ |  |  | ------ | ------ | - |  | 
|(In
thousands, except per share data)                                  |                       |             |           |   |        | December 30, |   | December 31, |     | December 26,
|                                                                       |                       |             |           |   |        | 2001         |   | 2000         |     | 1999        
|                                                                       |                       |             |           |   |        |              |   |              |     |              | 
|Net (loss) earnings from                                               |                       | As reported |           | $ | (5,120 | )            |   |              | 592 |              |  |  | (3,956 | )     
|                                                                       | continuing operations |             | Pro forma |   |        | (5,136       | ) |              |     | 499          |  |  |        | (4,016 | )
|Basic and diluted net (loss) earnings
per common share from continuing |                       | As reported |           |   | (1.75  | )            |   |              | .21 |              |  |  | (1.37  | )     
|                                                                       | operations            |             | Pro forma |   | $      | (1.76        | ) |              |     | .17          |  |  |        | (1.39  | )

31



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(8) Stock Option Plans (continued)

The fair value of the option grants has been estimated as of the date of the
grant using the Black-Scholes option pricing model. The various factors used
for options granted in the year ended December 30, 2001 and December 31, 2000
are provided below:

|                        |  |                   |      |                   |  |  |      |  
|----------------------- |  | ----------------- | ---- | ----------------- |  |  | ---- | -
|                        |  | December 31, 2001 |      | December 30, 2000
|                        |  |                   |      |                  
|Risk-free interest rate |  |                   | 5.12 | %                 |  |  | 5.07 | %
|Dividend yield          |  |                   |     |                   |  |  |     |  
|Expected life           |  | 10 Years          |      | 10 Years         
|Volitility              |  |                   | 35.6 | %                 |  |  | 21.9 | %

32



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(9) Income Taxes

The components and allocation of the total provision for income tax
(benefit) expense are as follows:

|                            |         |                |      |              |      |              |     |     |     |  |        |        |        |  
|--------------------------- | ------- | -------------- | ---- | ------------ | ---- | ------------ | --- | --- | --- |  | ------ | ------ | ------ | -
|(In thousands)              |         | December 30,   |      | December 31, |      | December 26,
|                            |         | 2001           |      | 2000         |      | 1999        
|                            |         |                |      |              |      |              |     |    
|Current expense (benefit):  |         |                |      |              |      |              |     |     |     |  |        |       
|                            | Federal |                | $    |             |      |              |     | 105 |     |  |        | (13    | )     
|                            | State   |                |      |             |      |              |     | 18  |     |  |        | 66     |       
|                            | Foreign |                |      |             |      |              |     |    |     |  |        | 150    |       
|                            |         |                |      |              |      |              |     |     |     |  |        |       
|                            |         | Total current  |      |              |     |              |     |     | 123 |  |        |        | 203    |  
|                            |         |                |      |              |      |              |     |     |     |  |        |       
|Deferred (benefit) expense: |         |                |      |              |      |              |     |     |     |  |        |       
|                            | Federal |                |      | (412         | )    |              |     | 386 |     |  |        | (3,121 | )     
|                            | State   |                |      | (48          | )    |              |     | 132 |     |  |        | (70    | )     
|                            | Foreign |                |      |             |      |              |     | 97  |     |  |        | 48     |       
|                            |         |                |      |              |      |              |     |     |     |  |        |       
|                            |         | Total deferred |      |              | (460 | )            |     |     | 615 |  |        |        | (3,143 | )
|                            |         |                |      |              |      |              |     |     |     |  |        |       
|                            |         | $              | (460 | )            |      |              | 738 |     |     |  | (2,940 | )     
|                            |         |                |      |              |      |              |     |     |     |  |        |       
|Continuing operations       |         | $              | (460 | )            |      |              | 615 |     |     |  | 68     |       
|Discontinued operations     |         |                |     |              |      |              | 123 |     |     |  | (3,008 | )     
|                            |         |                |      |              |      |              |     |     |     |  |        |       
|                            |         | $              | (460 | )            |      |              | 738 |     |     |  | (2,940 | )     
|                            |         |                |      |              |      |              |     |     |     |  |        |       

The source of aggregate (loss) earnings before income taxes is as
follows:

|                                     |          |              |        |              |   |              |       |       |     |  |         |        |         |  
|------------------------------------ | -------- | ------------ | ------ | ------------ | - | ------------ | ----- | ----- | --- |  | ------- | ------ | ------- | -
|(In thousands)                       |          | December 30, |        | December 31, |   | December 26,
|                                     |          | 2001         |        | 2000         |   | 1999        
|                                     |          |              |        |              |   |              |       |      
|(Loss) earnings before income taxes: |          |              |        |              |   |              |       |       |     |  |         |       
|Continuing operations:               |          |              |        |              |   |              |       |       |     |  |         |       
|                                     | Domestic |              | $      | (5,580       | ) |              |       | 1,207 |     |  |         | (3,888 | )      
|                                     |          |              |        |              |   |              |       |       |     |  |         |       
|Discontinued operations:             |          |              |        |              |   |              |       |       |     |  |         |       
|                                     |          | Domestic     |        |              |  |              |       |       | 138 |  |         |        | (11,225 | )
|                                     |          | Foreign      |        |              |  |              |       |       | 171 |  |         |        | 388     |  
|                                     |          |              |        |              |   |              |       |       |     |  |         |       
|                                     |          |              |       |              |   |              | 309   |       |     |  | (10,837 | )     
|                                     |          |              |        |              |   |              |       |       |     |  |         |       
|                                     |          | $            | (5,580 | )            |   |              | 1,516 |       |     |  | (14,725 | )     
|                                     |          |              |        |              |   |              |       |       |     |  |         |       

33



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(9) Income Taxes (continued)



| |                                                                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Actual income taxes from continuing operations differ from the expected
taxes (computed by applying the U.S. Federal corporate tax rate of 34% to
(loss) earnings before income taxes) as follows:

|                                        |                                       |                                           |        |              |   |              |      |    |     |  |        |       |    | 
|--------------------------------------- | ------------------------------------- | ----------------------------------------- | ------ | ------------ | - | ------------ | ---- | -- | --- |  | ------ | ----- | -- | 
|(In thousands)                          |                                       | December 30,                              |        | December 31, |   | December 26,
|                                        |                                       | 2001                                      |        | 2000         |   | 1999        
|                                        |                                       |                                           |        |              |   |              |      |   
|Computed expected tax (benefit) expense |                                       | $                                         | (1,897 | )            |   |              | 417  |    |     |  | (1,322 | )    
|Adjustments resulting from:             |                                       |                                           |        |              |   |              |      |    |     |  |        |      
|                                        | State tax, net of Federal tax benefit |                                           |        | (48          | ) |              |      | 31 |     |  |        | 1     |   
|                                        | Goodwill amortization and impairment  |                                           |        | 335          |   |              |      | 12 |     |  |        | 1,287 |   
|                                        | Meals & entertainment                 |                                           |        | 35           |   |              |      | 32 |     |  |        | 47    |   
|                                        |                                       | Change in estimate for tax benefit,
other |        |              |  |              |      |    | 123 |  |        |       | 55 | 
|                                        | Valuation allowance                   |                                           |        | 1,115        |   |              |      |   |     |  |        |      |   
|                                        |                                       |                                           |        |              |   |              |      |    |     |  |        |      
|                                        |                                       | $                                         | (460   | )            |   |              | 615  |    |     |  | 68     |      
|                                        |                                       |                                           |        |              |   |              |      |    |     |  |        |      
|Effective tax rate                      |                                       |                                           | (8.3   | %)           |   |              | 50.9 | %  |     |  | (1.7   | %)   
|                                        |                                       |                                           |        |              |   |              |      |    |     |  |        |      



| |                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------
| | The tax effects of temporary differences that give rise to the aggregate
deferred tax assets and liabilities are detailed on the following page:

34



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(9) Income Taxes (continued)

|                                     |                                                 |                                            |       |              |    |  |       |        |    | 
|------------------------------------ | ----------------------------------------------- | ------------------------------------------ | ----- | ------------ | -- |  | ----- | ------ | -- | 
|(In thousands)                       |                                                 | December 30,                               |       | December 31,
|                                     |                                                 | 2001                                       |       | 2000        
|                                     |                                                 |                                            |       |              |    | 
|Deferred tax assets and liabilities: |                                                 |                                            |       |              |    |  |       |       
|                                     | Allowance for doubtful receivables              |                                            | $     | 101          |    |  |       | 125    |   
|                                     | Accrued insurance expense                       |                                            |       | 374          |    |  |       | 967    |   
|                                     | Accrued loss on disposal                        |                                            |       | 171          |    |  |       | 353    |   
|                                     | Accumulated depreciation of plant and equipment |                                            |       | 670          |    |  |       | (735   | ) 
|                                     | Accumulated amortization of other assets        |                                            |       | 988          |    |  |       | 656    |   
|                                     |                                                 | Foreign tax and other credit carryforwards |       |              | 24 |  |       |        | 24 | 
|                                     | Operating loss carryforwards                    |                                            |       | 4,375        |    |  |       | 2,657  |   
|                                     | Other                                           |                                            |       | 271          |    |  |       | 158    |   
|                                     |                                                 |                                            |       |              |    |  |       |       
|                                     |                                                 |                                            | 6,974 |              |    |  | 4,205 |       
|                                     | Valuation allowances                            |                                            |       | (3,353       | )  |  |       | (1,044 | ) 
|                                     |                                                 |                                            |       |              |    |  |       |       
|Net deferred tax assets              |                                                 | $                                          | 3,621 |              |    |  | 3,161 |       
|                                     |                                                 |                                            |       |              |    |  |       |       



| |                                                                                                 
| | ------------------------------------------------------------------------------------------------
| | Net deferred tax assets are allocated between continuing and discontinued
operations as follows:

|                         |                                    |                                       |   |              |       |  |  |       |       | 
|------------------------ | ---------------------------------- | ------------------------------------- | - | ------------ | ----- |  |  | ----- | ----- | 
|(In thousands)           |                                    | December 30,                          |   | December 31,
|                         |                                    | 2001                                  |   | 2000        
|                         |                                    |                                       |   |              |       | 
|Continuing operations:   |                                    |                                       |   |              |       |  |  |      
|                         | Current deferred tax assets        |                                       | $ | 1,193        |       |  |  | 2,549 |      
|                         | Long-term deferred tax assets      |                                       |   | 1,962        |       |  |  | 105   |      
|                         |                                    |                                       |   |              |       |  |  |      
|                         |                                    | Net deferred tax assets               |   |              | 3,155 |  |  |       | 2,654 | 
|                         |                                    |                                       |   |              |       |  |  |      
|Discontinued operations: |                                    |                                       |   |              |       |  |  |      
|                         | Current deferred tax assets        |                                       |   | 466          |       |  |  | 507   |      
|                         | Long-term deferred tax liabilities |                                       |   |             |       |  |  |      |      
|                         |                                    |                                       |   |              |       |  |  |      
|                         |                                    | Net deferred tax assets (liabilities) |   |              | 466   |  |  |       | 507   | 
|                         |                                    |                                       |   |              |       |  |  |      
|                         |                                    | Net deferred tax assets               |   | $            | 3,621 |  |  |       | 3,161 | 
|                         |                                    |                                       |   |              |       |  |  |      

35



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##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(9) Income Taxes (continued)

In assessing the realizability of deferred tax assets, management considers,
within each taxing jurisdiction, whether it is more likely than not that some
portion or all of the deferred tax assets will not be realized. Management
considers the scheduled reversal of deferred tax liabilities, projected future
taxable income, and tax planning strategies in making this assessment. Based
upon the level of historical taxable income and projections for future taxable
income over the years in which the deferred tax assets are deductible,
management has provided valuation allowances for those deferred tax assets that
are not expected to be realized.

(10) Employee Benefit Plans

The Company had two qualified noncontributory defined benefit pension plans
covering substantially all of its personnel in the United States, including one
covering all non-bargaining unit employees of its discontinued operations. The
benefits were based on years of service and the employees average compensation
during employment. Pension costs were funded as required by applicable
regulations. Plan assets were invested in a diversified portfolio, which
included common stocks, bond and mortgage obligations, insurance contracts and
money market funds.

On January 15, 1999, the Company announced its intention to terminate its
qualified noncontributory defined benefit pension plans. Final distribution of
plan assets were made on April 24, 2001 for the C. H. Heist Corp. Employees
Pension Plan and on May 24, 2001 for the Ablest Service Corp. United States
Employees Pension Plan. The net assets of the plans were allocated, as
prescribed by ERISA and its related regulations.

The Company currently maintains a qualified defined contribution plan covering
all employees in the United States. The Company matches the contributions of
participating employees, with a maximum contribution limit, on the basis of the
percentages specified in the plan. The matching contributions were
approximately $276,000, $351,000 and $270,000 for the years ended December 30,
2001, December 31, 2000 and December 26, 1999, respectively. Of these amounts
approximately $276,000, $305,000 and $150,000 were allocated to continuing
operations.

(11) Industry Segments

Effective with the March 13, 2000 sale of its industrial maintenance
operations, the Companys sole business is in providing staffing services on a
temporary and contract basis. Management of the Company views its operations as
having two operating segments: commercial staffing services, consisting mostly
of clerical and light industrial staffing services and information technology
staffing services, consisting mostly of programmers and systems support
personnel. Staffing services for both segments are provided throughout the
eastern United States and select southwestern U.S. markets.

Corporate assets not allocated consist primarily of cash equivalents. There
were no cash equivalents at December 30, 2001 and December 31, 2000. Operating
segment data as of and for each of the years ended December 30, 2001, December
31, 2000 and December 26, 1999 are provided on the following page.

36



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(11) Industry Segments, (continued)

|                              |                                    |              |              |              |       |              |  |        |        |        |  |        |        |        | 
|----------------------------- | ---------------------------------- | ------------ | ------------ | ------------ | ----- | ------------ |  | ------ | ------ | ------ |  | ------ | ------ | ------ | 
|(In thousands)                |                                    | December 30, |              | December 31, |       | December 26,
|                              |                                    | 2001         |              | 2000         |       | 1999        
|                              |                                    |              |              |              |       |              |  |        |       
|Commercial Staffing Services: |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              | Net service revenues               |              | $            | 76,596       |       |              |  | 88,219 |        |        |  | 76,546 |       
|                              | Cost of services                   |              |              | 61,221       |       |              |  | 69,339 |        |        |  | 59,610 |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              |                                    |              | Gross profit |              |       | 15,375       |  |        |        | 18,880 |  |        |        | 16,936 | 
|                              | Selling,
general & administrative: |              |              | 10,773       |       |              |  | 11,389 |        |        |  | 9,247  |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              | Operating income                   |              |              | 4,602        |       |              |  | 7,491  |        |        |  | 7,689  |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              | Amortization                       |              |              |             |       |              |  |       |        |        |  |       |       
|                              |                                    | Receivables  |              | $            | 9,247 |              |  |        | 12,594 |        |  |        | 11,285 |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|Technology Staffing Services: |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              | Net service revenues               |              | $            | 10,447       |       |              |  | 15,216 |        |        |  | 21,548 |       
|                              | Cost of services                   |              |              | 8,166        |       |              |  | 11,366 |        |        |  | 16,165 |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              |                                    |              | Gross profit |              |       | 2,281        |  |        |        | 3,850  |  |        |        | 5,383  | 
|                              | Selling,
general &
administrative: |              |              | 1,838        |       |              |  | 2,474  |        |        |  | 3,514  |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              | Operating income                   |              |              | 443          |       |              |  | 1,376  |        |        |  | 1,869  |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       
|                              | Amortization of intangible assets  |              |              | 323          |       |              |  | 366    |        |        |  | 724    |       
|                              |                                    | Receivables  |              | $            | 958   |              |  |        | 2,316  |        |  |        | 2,434  |       
|                              |                                    |              |              |              |       |              |  |        |        |        |  |       

Operating income on this segment statement differs from the operating income
reported on the Statements of Operations because it does not include some
corporate expenses. These corporate items include costs associated with
providing executive, administrative, information technology and human resource
services to field operations. These costs are not allocated to the operating
segments.

(12) Lease Commitments

The Company occupies certain facilities under noncancellable operating lease
arrangements. Expenses under such arrangements amounted to approximately
$1,434,000, $1,247,000 and $1,234,000 for the years ended December 30, 2001,
December 31, 2000 and December 26, 1999, respectively, of which approximately
$1,434,000, $1,220,000 and $947,000, respectively relate to continuing
operations.

In addition, the Company leases certain automotive and office equipment under
noncancellable operating lease arrangements, which provide for minimum monthly
rental payments. Expenses under such arrangements amounted to approximately
$163,000, $446,000 and $814,000 for the years ended December 30, 2001, December
31, 2000 and December 26, 1999, respectively of which approximately $163,000,
$273,000 and $238,000, respectively, relate to continuing operations.

37



---



##### 



ABLEST INC.
Notes to Financial Statements
(continued)

(12) Lease Commitments (continued)

Management expects that in the normal course of its continuing operations, new
leases will replace leases that expire. Real estate taxes, insurance and
maintenance expenses are obligations of the Company.

A summary of future minimum operating lease payments for continuing operations
at December 30, 2001 follows:

|               |  |          |       |           |  |   |     | 
|-------------- |  | -------- | ----- | --------- |  | - | --- | 
|(In thousands) |  |          |       |           |  |   |     | 
|               |  | Real     |       |           |  |  
|Year           |  | Property |       | Equipment
|               |  |          |       |          
|2002           |  | $        | 1,237 |           |  | $ | 138 | 
|2003           |  |          | 1,032 |           |  |   | 107 | 
|2004           |  |          | 726   |           |  |   | 15  | 
|2005           |  |          | 456   |           |  |   | 8   | 
|2006           |  |          | 110   |           |  |   |    | 

(13) Contingencies

The Company is subject, from time to time, to claims encountered in the normal
course of business. In the opinion of management, the resolution of all
pending matters will not have a material adverse effect on the Companys
financial condition or liquidity.

The Company carries a broad range of insurance coverage, including general and
business auto liability, commercial property, workers compensation and a
general umbrella policy. The Company is self-insured for general and workers compensation.
Accruals for losses are made based on the Companys claims experience and
actuarial assumptions followed in the insurance industry. Management believes
that the amount accrued is adequate to cover all known and unreported claims at
December 30, 2001. Actual losses could differ from accrued amounts.

38



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##### 



ITEM 9. Changes In and Disagreements with Accountants on Accounting and
Financial Disclosure

On March 28, 2001, following the completion of a screening process, the Company
selected Arthur Andersen LLP as the Companys independent accountants.

Prior to March 28, 2001, The Company had not consulted with Arthur Andersen LLP
on items which involved the Companys accounting principals or the type of
audit opinion to be issued on the Companys financial statements, but did
discuss with Arthur Andersen LLP its engagement fees and standard engagement
terms for serving as the Companys auditors.

For the fiscal year ended December 30, 2001, there were no disagreements with
its accountants on accounting and financial disclosure.

PART III

ITEM 10. Directors and Executive Officers of the Registrant

The information in response to this item is hereby incorporated by reference to
the information under the caption Nominees for Directors presented in the
Companys definitive proxy statement to be filed with the Securities and
Exchange Commission and used in connection with the solicitation of proxies for
the Companys annual meeting of shareholders to be held on May 23, 2002, (the
Proxy Statement) except, insofar, as information with respect to executive
officers is presented in Part I hereof.

ITEM 11. Executive Compensation

The information in response to this item is hereby incorporated by reference to
the information under the caption Compensation of Executive Officers
presented in the Companys Proxy Statement. Information appearing in the Proxy
Statement under the headings Report on Executive Compensation by the
Compensation Committee and Board of Directors, Common Stock Performance and
Report of Audit Committee is not incorporated herein and should not be deemed
to be included in this document for any purposes.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management

The information in response to this item is hereby incorporated by reference to
the information under the caption Security Ownership of Certain Beneficial
Owners and Management presented in the Companys Proxy Statement.

ITEM 13. Certain Relationships and Related Transactions

The information in response to this item is hereby incorporated by reference to
the information under the caption Certain Transactions presented in the
Companys Proxy Statement.

39



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##### 



PART IV

ITEM 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)  The following documents are filed as part of this Report:

(1) Financial Statements

See Index to Financial Statements at page 14.

(2) Exhibits

Exhibits identified below are filed herewith or incorporated herein by
reference to the documents indicated in parentheses.

|        |  |                                                                                                                                                                                                                            
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |  |                                                                                                                                                                                                                            
|Number  |  | Description                                                                                                                                                                                                                
|        |  |                                                                                                                                                                                                                            
|2.1     |  | Agreement and Plan of Merger between C. H. Heist Crop. and Ablest Inc.
dated February 4, 2000. (Exhibit to the Companys Form 8-K report dated
March 22, 2000)                                                             
|2.2     |  | Agreement and Plan of Merger between Ablest Service Corp., PLP Corp.,
Milestone Technologies, Inc. and Ablest Inc., dated January 1, 2001.
(Exhibit to the Companys Form 10-K report for the year ended December 31,
2000)
|3.1     |  | Certificate of Incorporation of the Company. (Exhibit to the Companys
Form 10-K report for the year ended December 31, 2000)                                                                                              
|3.2     |  | By-laws of the Registrant. (Exhibit to the Companys Form 10-K report for
the year ended December 31, 2000.)                                                                                                               
|10.1    |  | Asset Sale and Purchase Agreement between C. H. Heist Corp. and Onyx
Industrial Services Inc. (Exhibit to the Companys Form 8-K report dated
March 22, 2000)                                                              
|10.2 *  |  | Standard LIBOR Grid Note agreement dated July 22, 2001, between the
Company and Manufacturers and Traders Trust Company.                                                                                                   
|10.3    |  | Independent Directors Stock Option Plan adopted May 14, 2000. (Exhibit to
the Companys Form 10-K report for the year ended December 31, 2000.)                                                                            
|10.4    |  | Option to Ownership Plan adopted October 9, 2000.
(Exhibit to the Companys Form 10-K report for the year ended December 31,
2000.)                                                                                        
|10.5    |  | Three year employment agreements with the Chairman of the Board, the CEO
and the President of Ablest Inc. (Exhibit to the Companys
Form 10-K report for the year ended December 31, 2000.)                                
|10.6*   |  | Two year employment agreement with the Vice President and
Chief Financial Officer dated January 21, 2002.                                                                                                                  

40



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##### 



ITEM 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(continued)

(2) Exhibits (continued)

|        |  |                                                                                                                                                                                               
|------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |  |                                                                                                                                                                                               
|Number  |  | Description                                                                                                                                                                                   
|        |  |                                                                                                                                                                                               
|20 *    |  | Letter to Securities and Exchange Commission concerning
representations made by Arthur Andersen LLP and required by Section
II.A. of the Requirements for Arthur Andersen LLP Auditing Clients
|21 *    |  | Subsidiaries of the Registrant                                                                                                                                                                
|23 *    |  | Consent of Arthur Andersen LLP to incorporation of its report into Form
S-8 No. 33-48497 and No. 333-48918.                                                                                   



---

|* |  | Filed herewith
|- |  | --------------



| |                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b) One report on Form 8-K was filed by the Company during 2001.
On April 23, 2001 the Company filed a report on Form 8-K announcing
a change in the registrants certifying accountants to Arthur
Andersen LLP from KPMG, LLP effective with the fiscal year ended
December 30, 2001.

The Company will furnish, without charge to a security holder upon request, a
copy of the documents portions of which are incorporated by reference herein
and will furnish any other exhibit at cost.

41



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##### 






SIGNATURES

Pursuant to the requirements of Section 13 of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

|                     |             |                                                                               
|-------------------- | ----------- | ------------------------------------------------------------------------------
|Date: March 19, 2002 |             |                                                                               
|                    
|                     | ABLEST INC.
|                    
|                     |             |                                                                               
|                    
|                     | By:         | /s/ Mark P. Kashmanian

Mark P. Kashmanian
Treasurer, Chief Accounting Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the Company
and in the capacities and as of the date indicated:



| |  |             |  |                                                                                               |  |     |  |                                                    
| |  | ----------- |  | --------------------------------------------------------------------------------------------- |  | --- |  | ---------------------------------------------------
| |  | ABLEST
INC.
|
|
| |  | By:         |  | /s/ Charles H. HeistCharles H. Heist
Chairman of the Board and
Acting Chief Financial Officer |  | By: |  | /s/ Donna R. MooreDonna R. Moore
Director          
|
| |  |             |  |                                                                                               |  |     |  |                                                    
|
| |  | By:         |  | /s/ W. David FosterW. David Foster
Director and
Chief Executive Officer                       |  | By: |  | /s/ Richard W. RobersonRichard W. Roberson
Director
|
| |  |             |  |                                                                                               |  |     |  |                                                    
|
| |  | By:         |  | /s/ Ronald K. LeirvikRonald K. Leirvik
Director                                               |  | By: |  | /s/ Charles E. ScharlauCharles E. Scharlau
Director

March 19, 2002

42



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##### 



EXHIBIT INDEX

|        |  |                                                                                                                                                                                                |  |           |   | 
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------- | - | 
|Exhibit |  |                                                                                                                                                                                                |  | Page or  
|Number  |  | Description                                                                                                                                                                                    |  | Reference
|        |  |                                                                                                                                                                                                |  |          
|2.1     |  | Agreement and Plan of Merger by C. H. Heist Corp. and Ablest Inc.
Dated and approved by the Board of Directors on February 4, 2000                                                             |  |           | 1 | 
|2.2     |  | Agreement and Plan of Merger by Ablest service Corp., PLP Corp.,
Milestone Technologies, Inc. and Ablest Inc. dated and approved by the
Board of Directors on November 9, 2000                 |  |           | 2 | 
|3.1     |  | Certificate of Incorporation of the Registrant                                                                                                                                                 |  |           | 2 | 
|3.2     |  | By-laws of the Registrant adopted on March 13, 2000.                                                                                                                                           |  |           | 2 | 
|10.1    |  | Asset Sale and Purchase Agreement between C. H. Heist Corp., and
Onyx Industrial Services, Inc. dated January 17, 2000                                                                         |  |           | 1 | 
|10.2    |  | Standard LIBOR Grid Note agreement between Ablest Inc. and
Manufacturers
and Traders Trust Company Dated July 22, 2001                                                                         |  |           | 3 | 
|10.3    |  | Independent Directors Stock Option Plan
dated and approved by the Board of Directors on May 16, 2000                                                                                          |  |           | 2 | 
|10.4    |  | Option to Ownership Plan dated and approved by the Board of Directors
August 23, 2000                                                                                                          |  |           | 2 | 
|10.5    |  | Three year employment agreements for the Chairman of the Board, the CEO
and the President dated September 1, 2000                                                                              |  |           | 2 | 
|10.6    |  | Two year employment agreement for the Vice President and
Chief Financial Officer dated January 21, 2002                                                                                        |  |           | 3 | 
|20      |  | Letter to Securities and Exchange Commission concerning
representations made By Arthur Andersen LLP and required by Section
II.A. of the Requirements for Arthur Andersen LLP Auditing Clients |  |           | 3 | 
|21      |  | Subsidiaries of Registrant                                                                                                                                                                     |  |           | 3 | 
|23.1    |  | Consent of Arthur Andersen LLP to incorporation of reports
into Forms S-8 No. 33-48497 and No. 333-48918                                                                                       |  |           | 3 | 



---

|(1) |  | Filed as Exhibit to the Registrants Form 8-K report dated March 22, 2000
and incorporated herein by reference.                    
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Filed as an Exhibit to the Registrants Form 10-K Report for the year
ended December 31, 2000 and incorporated herein by reference.
|   
|(3) |  | Filed as an Exhibit to this report.                                                                                                

43