-----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, FiUN/YFHKHzYQkLWEARMJtZlnKD3nhpTc/7ipoXFiTn7Pl9/Zu89U5i8yeDENQMS JMPViEc1sdWA5zTPIaXl6w== 0001013816-04-000690.txt : 20041104 0001013816-04-000690.hdr.sgml : 20041104 20041104165206 ACCESSION NUMBER: 0001013816-04-000690 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041002 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041104 DATE AS OF CHANGE: 20041104 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MANAGEMENT NETWORK GROUP INC CENTRAL INDEX KEY: 0001094814 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 481129619 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27617 FILM NUMBER: 041120159 BUSINESS ADDRESS: STREET 1: 7300 COLLEGE BLVD., STE 302 CITY: OVERLAND PARK STATE: KS ZIP: 66210 BUSINESS PHONE: 9133459315 MAIL ADDRESS: STREET 1: 7300 COLLEGE BLVD., STE 302 CITY: OVERLAND PARK STATE: KS ZIP: 66210 8-K 1 form8k_110304.txt FORM 8-K 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 4, 2004 THE MANAGEMENT NETWORK GROUP, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 0-27617 48-1129619 - -------------------------------------------------------------------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 7300 College Boulevard, Suite 302, Overland Park, KS 66210 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (913) 345-9315 -------------------- 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 (see General Instruction A.2.): [ ] 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 On November 4, 2004, The Management Network Group, Inc. announced its results of operations and financial condition for the quarter ended October 2, 2004. The public announcement was made by means of a press release, the text of which is set forth in Exhibit 99.1 hereto. The information in this Item 2.02, and Exhibit 99.1 to this Current Report on Form 8-K, shall not be deemed "filed" for the purposes of or otherwise subject to the liabilities under Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Unless expressly incorporated into a filing of TMNG under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act made after the date hereof, the information contained in this Item 2.02 and Exhibit 99.1 hereto shall not be incorporated by reference into any filing of TMNG, whether made before or after the date hereof, regardless of any general incorporation language in such filing. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (C). EXHIBITS. EXHIBIT NUMBER DESCRIPTION - ------------------- -------------------------------------------------------- 99.1 Press Release dated November 4, 2004 SIGNATURE 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 hereunto duly authorized. THE MANAGEMENT NETWORK GROUP, INC. -------------------------------------------- (Registrant) Date: November 4, 2004 By: /s/ Donald E. Klumb -------------------------------------------- Donald E. Klumb Vice President and Chief Financial Officer EXHIBIT INDEX Exhibit Number Description of Document 99.1 Press Release of Registrant, Dated November 4, 2004 Announcing Financial Results for its Third Quarter Ended October 2, 2004 EX-99 2 form8k_110304ex991.txt EXH. 99.1 2004 THIRD QUARTER RESULTS Exhibit 99.1 CONTACT: The Management Network Group, Inc. or Brainerd Communicators Regina Whitley Brian Schaffer (Investors) regina.whitley@tmng.com schaffer@braincomm.com 800.876.5329 x340 Ray Yeung (Media) yeung@braincomm.com 212.986.6667 TMNG REPORTS 2004 THIRD QUARTER RESULTS OVERLAND PARK, KS - NOVEMBER 4, 2004 - The Management Network Group, Inc. (Nasdaq: TMNG), a leading provider of management consulting services to the global communications industry, today reported financial results for its 2004 third quarter ended October 2, 2004. Revenue in the third quarter of 2004 was $6.5 million, compared with $4.7 million in the third quarter of 2003 and with $5.2 million in the second quarter of 2004. During the quarter gross margin was 46.7%, compared with 46.8% in the third quarter of 2003 and 46.2% in the second quarter of 2004. Net loss for the third quarter was $1.1 million, or $0.03 per diluted share, compared with a net loss of $2.7 million, or $0.08 per diluted share in last year's third quarter. The company ended the third quarter with a strong cash position of $49.1 million, virtually no long-term debt, stockholders' equity of $67.4 million, and working capital of approximately $54.2 million. In the first nine months of 2004, revenue was $17.5 million, compared with $16.9 million in the first nine months of 2003. Gross margin was 47.2% for 2004 year-to-date period, compared with 48.0% in the year ago corresponding period. Net loss for the nine months was $7.5 million, or $0.22 per diluted share, which includes a $2.3 million, or $0.07 per diluted share loss from discontinued operations related to the former hardware segment of the business. This compares to a net loss of $22.6 million, or $0.68 per diluted share for the first nine months of 2003. Results for the first nine months of fiscal 2003 included a non-cash goodwill and intangible asset impairment charge of $18.9 million. "TMNG's third quarter revenue growth evidences early success from our initiatives to transform our business model and consulting offerings toward wireless and IP-based technology platforms," said Rich Nespola, TMNG Chairman and CEO. "Our well-established wireless practice has helped drive a sequential increase in new customers, while our emerging TMNG Resources group is gaining traction by providing near-term management and strategic talent to service providers beginning their own transformations. Our focus is on leveraging these early successes to build the revenue momentum back into the business that is necessary to drive a return to profitability. And while the continued volatility in the telecom industry means that our near-term results will remain unpredictable, we are supported by our strong balance sheet which will enable us to continue to fund on-going strategic initiatives." CONFERENCE CALL TMNG will host a conference call at 5:00 p.m. ET today to discuss 2004 third quarter results. Investors can access the conference call via a live webcast on the company's Web site, www.tmng.com, or by dialing 877-297-4509. A replay of the conference call will be archived on the company's Web site for one week. Additionally, a replay of the call can be accessed by dialing 877-519-4471, pin number 5299328, through November 10, 2004. ABOUT TMNG The Management Network Group, Inc. (Nasdaq: TMNG) is a leading provider of strategy, management, marketing, operational and technology consulting services to the global communications industry. With more than 400 consultants worldwide, TMNG serves communications service providers, technology companies, and financial services firms. Since the company's inception in 1990, TMNG and its subsidiaries - TMNG Strategy, TMNG Marketing, TMNG Technologies and TMNG Europe - - have served more than 1,000 clients worldwide, including all the Fortune 500 telecommunications companies. TMNG is headquartered in Overland Park, Kansas, with offices in Boston, Chicago, Dallas, San Diego, London, New York, San Francisco, Toronto, Utrecht and Washington, D.C. TMNG can be reached at 1.888.480.TMNG (8664) or online at http://www.tmng.com. THIS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORWARD-LOOKING STATEMENTS INVOLVE RISKS AND UNCERTAINTIES. IN PARTICULAR, ANY STATEMENTS CONTAINED HEREIN REGARDING EXPECTATIONS WITH RESPECT TO FUTURE BUSINESS, REVENUES OR PROFITABILITY ARE SUBJECT TO KNOWN AND UNKNOWN RISKS, UNCERTAINTIES, AND CONTINGENCIES, MANY OF WHICH ARE BEYOND THE COMPANY'S CONTROL, WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE, OR ACHIEVEMENTS TO DIFFER MATERIALLY FROM THOSE PROJECTED OR IMPLIED IN SUCH FORWARD-LOOKING STATEMENTS. FACTORS THAT MIGHT AFFECT ACTUAL RESULTS, PERFORMANCE, OR ACHIEVEMENTS INCLUDE, AMONG OTHER THINGS, CONDITIONS IN THE TELECOMMUNICATIONS INDUSTRY, OVERALL ECONOMIC AND BUSINESS CONDITIONS, THE DEMAND FOR THE COMPANY'S GOODS AND SERVICES, AND TECHNOLOGICAL ADVANCES AND COMPETITIVE FACTORS IN THE MARKETS IN WHICH THE COMPANY COMPETES. THESE RISKS AND UNCERTAINTIES ARE DESCRIBED IN DETAIL FROM TIME TO TIME IN TMNG'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. (Please see attached financial tables) THE MANAGEMENT NETWORK GROUP, INC. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
QUARTER ENDED YEAR-TO-DATE October 2, September 27, October 2, September 27, 2004 2003 2004 2003 Revenues $ 6,546 $ 4,691 $ 17,509 $ 16,894 Cost of services: Direct cost of services 3,441 2,506 9,093 8,903 Equity related charges (benefit) 51 (10) 157 (114) --------- --------- ---------- ---------- Total 3,492 2,496 9,250 8,789 Gross profit 3,054 2,195 8,259 8,105 Operating expenses: Selling, general and administrative 3,694 4,225 11,798 14,097 Goodwill and intangible asset impairment 18,942 Equity related charges 261 7 776 10 Depreciation and amortization 384 711 1,294 2,525 --------- --------- ---------- ---------- Total 4,339 4,943 13,868 35,574 --------- --------- ---------- ---------- Loss from continuing operations (1,285) (2,748) (5,609) (27,469) Other income, net 179 127 445 433 --------- --------- ---------- ---------- Loss from continuing operations before income tax (provision) benefit (1,106) (2,621) (5,164) (27,036) Income tax (provision) benefit (13) (47) 4,367 --------- --------- ---------- ---------- Loss from continuing operations (1,119) (2,621) (5,211) (22,669) --------- --------- ---------- ---------- Net income (loss) from discontinued operations (including impairment and severance charges) (30) (2,276) 49 --------- --------- ---------- ---------- Net loss $ (1,119) $ (2,651) $ (7,487) $(22,620) ========== ========= ========== ========== Loss from continuing operations per common share Basic and diluted $ (0.03) $ (0.08) $ (0.15) $ (0.68) ========== ========== ========== ========== Loss from discontinued operations per common share Basic and diluted $ (0.07) ========== ========= ========== ========== Net loss per common share Basic and diluted $ (0.03) $ (0.08) $ (0.22) $ (0.68) ========== ========= ========== ========== Shares used in calculation of net loss per common share Basic and diluted 34,631 33,458 34,586 33,392 ========== ========= ========== ==========
THE MANAGEMENT NETWORK GROUP, INC. CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED) (IN THOUSANDS) ASSETS October 2, September 27, 2004 2003 CURRENT ASSETS: Cash and cash equivalents $ 49,096 $ 52,875 Receivables, net 7,711 6,864 Refundable income taxes 1,336 1,557 Other assets 825 710 ----------- ----------- Total current assets 58,968 62,006 GOODWILL 13,365 15,528 INTANGIBLES, net 704 1,478 PROPERTY & EQUIPMENT, net 1,104 1,558 OTHER ASSETS 445 402 ----------- ----------- TOTAL ASSETS $ 74,586 $ 80,972 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Trade accounts payable $ 583 $ 635 Accrued liabilities and other 4,198 4,140 ----------- ----------- Total current liabilities 4,781 4,775 NONCURRENT LIABILITIES 2,383 2,828 STOCKHOLDERS' EQUITY 67,422 73,369 ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 74,586 $ 80,972 =========== =========== -----END PRIVACY-ENHANCED MESSAGE-----