-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VfoIWpBKDuH+7BtLY6S6zEoHs8ubGBSYqkzGHtFWc0FhQZt+rqNgKsn2A5Bs9/Nb 2t+vRTz7wu3D8TcP4majgQ== 0000910680-04-001210.txt : 20041116 0000910680-04-001210.hdr.sgml : 20041116 20041116161746 ACCESSION NUMBER: 0000910680-04-001210 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041112 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041116 DATE AS OF CHANGE: 20041116 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SPAR GROUP INC CENTRAL INDEX KEY: 0001004989 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 330684451 STATE OF INCORPORATION: DE FISCAL YEAR END: 0101 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27408 FILM NUMBER: 041149723 BUSINESS ADDRESS: STREET 1: 580 WHITE PLAINS ROAD CITY: TARRYTOWN STATE: NY ZIP: 10591 BUSINESS PHONE: 914-332-4100 MAIL ADDRESS: STREET 1: 580 WHITE PLAINS ROAD CITY: TARRYTOWN STATE: NY ZIP: 10591 FORMER COMPANY: FORMER CONFORMED NAME: PIA MERCHANDISING SERVICES INC DATE OF NAME CHANGE: 19951220 8-K 1 f8k111204.txt CURRENT REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------- FORM 8-K Current Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): November 12, 2004 SPAR Group, Inc. (Exact Name of Registrant as Specified in Charter) - ----------------------------- -------------------------- ----------------------- Delaware 0-27824 33-0684451 --------- -------- ---------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File No.) Identification No.) - ----------------------------- -------------------------- ----------------------- 580 White Plains Road, Tarrytown, New York 10591 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (914) 332-4100 - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02. Results of Operations and Financial Condition. - --------- ---------------------------------------------- (a) On November 12, 2004, SPAR Group, Inc. (the "Registrant") issued the press release attached to this Current Report on Form 8-K (the "Report") as Exhibit 99.1 reporting its financial results for the third quarter ended September 30, 2004, which is incorporated herein by reference. The information in this Report, including the exhibit, shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. It shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. Item 9.01. Financial Statements and Exhibits. - --------- --------------------------------- (c) Exhibits: 99.1 Press Release of the Registrant dated November 12, 2004. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. SPAR GROUP, INC. Date: November 16, 2004 By: /s/ Charles Cimitile -------------------------------- Charles Cimitile Chief Financial Officer EXHIBIT INDEX Exhibit Number Description - ------ ----------- 99.1 Press Release of the Registrant dated November 12, 2004. EX-99 2 ex99_1-f8k111204.txt EX-99.1; PRESS RELEASE EXHIBIT 99.1 SPAR Group Reports Financial Results for 2004 Third Quarter; Company Reports Profitable Third Quarter TARRYTOWN, N.Y., Nov 12, 2004 -- SPAR Group, Inc. (SGRP) today reported a profit for the third quarter ended September 30, 2004. The company achieved net income of $210,000, equal to $.01 per diluted share, for the 2004 third quarter, compared with a net loss of $345,000, or a loss of $.02 per share, a year ago. Net revenues for the 2004 third quarter declined to $10.7 million from $16.6 million last year. Robert G. Brown, SPAR Group's chairman and chief executive officer, said the significant expense reductions are evidence of SPAR's restructuring to reflect the company's current size. He said the lower comparative revenue, in part, resulted from the company's largest customer completing the sale of its business. "Our restructuring plan is focused on improving SPAR's financial health," Brown said. "We are downsizing our expense structure and cutting fixed costs throughout the company. At the same time, we are not losing sight of SPAR's future and continue to invest in technology, local in-store demonstration services and international expansion. "While business conditions remain challenging, we are optimistic about the company's long-term future and the progress being made to achieve and sustain positive operating results," Brown said. For the three months ended September 30, 2004, the gross margin percentage improved to 34.8% from 31.5% last year. Selling, general and administrative expenses totaling $4.0 million, include $500,000 of restructuring expenses and were reduced from $5.3 million for the corresponding period last year. SPAR also reported $800,000 of other income that includes non-recurring income of approximately $600,000 resulting from the restructuring of debt due to the company from a prior subsidiary. For the first nine months of 2004, SPAR posted a net loss of $12.8 million, or $0.68 per share, on net revenues of $35.4 million. The company had net income of $1.5 million, equal to $0.08 per diluted share, on net revenues of $52.7 million for the corresponding prior year period. Brown said more than 63%, or $8.1 million of the loss for the 2004 year-to-date period, was attributable to non-cash, non-recurring items related to the write off of goodwill and other impairment charges. SPAR Group, Inc. is a diversified international marketing services company, providing a broad array of productivity enhancing products and services to help Fortune 1000 companies improve their sales, operating efficiency and profits. The company provides in-store merchandising, in-store demonstrations, technology and research to manufacturers and retailers covering all product classifications and all classes of trade, including mass market, drug store, convenience store and grocery chains, throughout the United States and internationally. Certain statements in this news release are forward-looking, including, but not limited to, the benefits to be derived from the company's restructuring plan and the ability to achieve and sustain positive operating results. The company's actual results, performance and trends could differ materially from those indicated or implied by such statements as a result of various factors, including (without limitation) the continued strengthening of SPAR's selling and marketing functions, continued customer satisfaction and contract renewal, new product development, continued technological superiority over its competitors, continued availability of capable dedicated personnel, continued cost management, the success of its international efforts, success and availability of acquisitions, availability of financing and other factors, as well as by factors applicable to most companies such as general economic, competitive and other business and civil conditions. Information regarding certain of these and other factors that could effect future results, performance or trends are discussed in SPAR Group's annual report on Form 10-K, quarterly reports on Form 10-Q, and other filings made with the Securities and Exchange Commission from time to time. SPAR Group, Inc. Consolidated Statements of Operations (unaudited) (in thousands, except per share data)
Three Months Ended Nine Months Ended ----------------------- ----------------------- September September September September 30, 2004 30, 2003 30, 2004 30, 2003 -------- -------- -------- -------- Net revenues $ 10,683 $ 16,615 $ 35,418 $ 52,704 Cost of revenues 6,963 11,380 24,474 33,777 -------- -------- -------- -------- Gross profit 3,720 5,235 10,944 18,927 Selling, general and administrative expenses 4,028 5,334 14,471 15,044 Impairment charges - - 8,141 - Depreciation and amortization 275 385 1,005 1,162 -------- -------- -------- -------- Operating (loss) income (583) (484) (12,673) 2,721 Interest expense (29) (69) (127) (209) Other income (expense) 773 - 764 (28) -------- -------- -------- -------- Income (loss) before provision for income taxes 161 (553) (12,036) 2,484 Provision (benefit) for income taxes 15 (208) 783 943 -------- -------- -------- -------- Net income (loss) before minority interest 146 (345) (12,819) 1,541 Minority interest 64 - 64 - -------- -------- -------- -------- Net income (loss) $ 210 $ (345) $(12,755) $ 1,541 ======== ======== ======== ======== Net income (loss) per common share: Basic $ 0.01 $ (0.02) $ (0.68) $ 0.08 Diluted $ 0.01 $ (0.02) $ (0.68) $ 0.08 ======== ======== ======== ======== Weighted average common shares - basic 18,859 18,859 18,859 18,853 ======== ======== ======== ======== Weighted average common shares - diluted 19,206 18,859 18,859 19,508 ======== ======== ======== ========
SPAR Group, Inc. Consolidated Balance Sheets (unaudited) (in thousands, except share and per share data) September December 30, 2004 31, 2003 -------- -------- Assets Current assets: Cash and cash equivalents $ 236 $ - Accounts receivable, net 7,966 13,942 Prepaid expenses and other current assets 1,267 659 Deferred income taxes - 1,305 -------- -------- Total current assets $ 9,469 $ 15,906 Property and equipment, net 1,686 2,099 Goodwill 798 8,749 Deferred income taxes - 434 Other assets 431 926 -------- -------- Total assets $ 12,384 $ 28,114 ======== ======== Liabilities and stockholders' equity Current liabilities: Accounts payable $ 1,593 $ 1,350 Accrued expenses and other current liabilities 1,194 4,081 Accrued expenses, due to affiliates 1,889 1,091 Restructuring charges, current 162 685 Customer deposits 915 530 Line of credit, short-term 2,809 4,084 -------- -------- Total current liabilities $ 8,562 $ 11,821 Other long-term liabilities 476 270 Restructuring charges, long term 117 - Commitments and contingencies Stockholders' equity: Preferred stock, $.01 par value: Authorized shares - 3,000,000 Issued and outstanding shares - none $ - $ - Common stock, $.01 par value: Authorized shares - 47,000,000 Issued and outstanding shares - 18,858,972 - September 30, 2004 18,858,972 - December 31, 2003 189 189 Treasury stock (176) (384) Accumulated other comprehensive loss (56) (7) Additional paid-in capital 11,051 11,249 Accumulated (deficit) retained earnings (7,779) 4,976 -------- -------- Total stockholders' equity $ 3,229 $ 16,023 -------- -------- Total liabilities and stockholders' equity $ 12,384 $ 28,114 ======== ======== Contacts: Charles Cimitile, 914-332-4100 PondelWilkinson Inc. Roger S. Pondel, 310-279-5980 -----END PRIVACY-ENHANCED MESSAGE-----