-----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, JJduzt+KGBfhgUIwpeAjEFGjybOZi9Ia4r6jFy35mVNUIxP4cA+KNhS0fKsBkpTm sL7FEtTNhQGQrfY4lh4Ueg== 0000914317-96-000219.txt : 19960808 0000914317-96-000219.hdr.sgml : 19960808 ACCESSION NUMBER: 0000914317-96-000219 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960627 FILED AS OF DATE: 19960807 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMPUTER HORIZONS CORP CENTRAL INDEX KEY: 0000023019 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 132638902 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-07282 FILM NUMBER: 96604768 BUSINESS ADDRESS: STREET 1: 49 OLD BLOOMFIELD AVENUE CITY: MOUNTAIN LAKES STATE: NJ ZIP: 07046-1495 BUSINESS PHONE: 2014027400 MAIL ADDRESS: STREET 1: 49 0LD BLOOMFIELD AVE CITY: MOUNTAIN LAKES STATE: NJ ZIP: 07046-1495 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------------------------------------- F O R M 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 ------------------------------------------- For Quarter Ended June 27, 1996 Commission File Number 0-7282 ------------- ------ COMPUTER HORIZONS CORP. ------------------------------------------------------ (Exact name of registrant as specified in its charter) New York 13-2638902 - ------------------------------- ---------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 49 Old Bloomfield Avenue, Mountain Lakes, New Jersey 07046-1495 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code (201) 402-7400 -------------- Not Applicable ------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) 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 twelve 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. X --- -- Yes No As of August 1, 1996, the issuer had 16,063,278 shares of common stock outstanding. COMPUTER HORIZONS CORP. Index Part I Financial Information Consolidated Balance Sheets June 27, 1996 and December 31, 1995 Consolidated Statements of Income Three Months and Six Months Ended June 27, 1996 and June 28, 1995 Condensed Consolidated Statements of Cash Flows - Six Months Ended June 27, 1996 and June 28, 1995 Notes to Consolidated Financial Statements Management's Discussion and Analysis of Financial Condition and Results of Operations Part II Other Information Signatures
COMPUTER HORIZONS CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) June 27, December 31, 1996 1995 ------- ------------ (in thousands) ASSETS CURRENT ASSETS: Cash and cash equivalents ........................................ $ 8,195 $ 9,166 Accounts receivable, net of allowance for doubtful accounts of $896,000 and $840,000 at June 27, 1996 and December 31, 1995, respectively ............................ 48,197 44,729 Deferred income tax benefit ...................................... 1,827 1,245 Other ............................................................ 2,307 1,618 ------- ------- TOTAL CURRENT ASSETS ..................................... 60,526 56,758 ------- ------- PROPERTY AND EQUIPMENT ............................................. 8,224 7,454 Less accumulated depreciation .................................... 4,568 4,031 ------- ------- 3,656 3,423 ------- ------- OTHER ASSETS - NET: Goodwill ......................................................... 13,171 13,526 Other ............................................................ 2,631 2,330 ------- ------- TOTAL OTHER ASSETS ....................................... 15,802 15,856 ------- ------- TOTAL ASSETS ....................................................... $79,984 $76,037 ======= ======= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term debt ................................ $ 1,867 $ 2,385 Accrued payroll, payroll taxes and benefits ...................... 11,451 10,812 Accounts payable ................................................. 1,745 1,746 Income taxes payable ............................................. 986 1,535 Other accrued expenses ........................................... 650 1,386 ------- ------- TOTAL CURRENT LIABILITIES ................................ 16,699 17,864 ------- ------- LONG-TERM DEBT ..................................................... 1,432 3,299 ------- ------- OTHER LIABILITIES .................................................. 621 607 ------- ------- (Continued) COMPUTER HORIZONS CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Continued) (Unaudited) June 27, December 31, 1996 1995 ------- ------------ (in thousands) SHAREHOLDERS' EQUITY: Preferred stock, $.10 par; authorized and unissued 200,000 shares, including 50,000 Series A Common stock, $.10 par, authorized 30,000,000 shares; issued 17,834,161 shares and 17,407,514 shares at June 27, 1996 and December 31, 1995, respectively ............................ 1,783 1,741 Additional paid-in capital ....................................... 28,899 27,416 Retained earnings ................................................ 45,198 39,758 ------- ------- 75,880 68,915 Less 1,786,883 shares held in treasury, at cost .................. 14,648 14,648 ------- ------- TOTAL SHAREHOLDERS' EQUITY ............................... 61,232 54,267 ------- ------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ......................... $79,984 $76,037 ======= ======= See notes to consolidated financial statements.
COMPUTER HORIZONS CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited) THREE MONTHS ENDED SIX MONTHS ENDED ------------------------------------------------ ---------------------- ---------------------- June 27, 1996 June 28, 1995 June 27, 1996 June 28, 1995 ---------------------- ---------------------- ---------------------- ---------------------- (in thousands, except per share data) REVENUES ................... $56,032 100.0% $48,397 100.0% $113,063 100.0% $92,264 100.0% ---------------------- ---------------------- ---------------------- ---------------------- COSTS AND EXPENSES: Direct costs .......... 39,960 71.3% 34,230 70.7% 79,328 70.2% 65,596 71.1% Selling, administrative and general ........ 12,505 22.3% 10,222 21.1% 24,625 21.8% 19,516 21.2% ---------------------- ---------------------- ---------------------- ---------------------- 52,465 93.6% 44,452 91.8% 103,953 91.9% 85,112 92.2% ---------------------- ---------------------- ---------------------- ---------------------- INCOME FROM OPERATIONS ..... 3,567 6.4% 3,945 8.2% 9,110 8.1% 7,152 7.8% ---------------------- ---------------------- ---------------------- ---------------------- OTHER INCOME (expense): Interest income ....... 62 0.1% 57 0.1% 165 0.1% 94 0.1% Interest expense ...... (145) -0.3% (222) -0.5% (289) -0.3% (434) -0.5% Equity in Joint Venture net earnings ........ 230 0.4% 96 0.2% 443 0.4% 96 0.1% ---------------------- ---------------------- ---------------------- ---------------------- 147 0.3% (69) -0.1% 319 0.3% (244) -0.3% ---------------------- ---------------------- ---------------------- ---------------------- INCOME BEFORE INCOME TAXES.. 3,714 6.6% 3,876 8.0% 9,429 8.3% 6,908 7.5% ---------------------- ---------------------- ---------------------- ---------------------- INCOME TAXES: Current ............... 2,134 3.8% 1,951 4.0% 4,571 4.0% 3,046 3.3% Deferred .............. (558) -1.0% (240) -0.5% (582) -0.5% 15 0.0% ---------------------- ---------------------- ---------------------- ---------------------- 1,576 2.8% 1,711 3.5% 3,989 3.5% 3,061 3.3% ---------------------- ---------------------- ---------------------- ---------------------- NET INCOME ................. $2,138 3.8% $2,165 4.5% $5,440 4.8% $3,847 4.2% ====================== ====================== ====================== ====================== EARNINGS PER SHARE: Net income ............ $0.13 $0.15 $0.32 $0.26 ========== ========== ========== ========== WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING ......... 17,057,000 14,931,000 16,968,000 14,592,000 ========== ========== ========== ==========
See notes to consolidated financial statements.
COMPUTER HORIZONS CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) SIX MONTHS ENDED ----------------------- June 27, June 28, 1996 1995 -------- -------- (in thousands) CASH FLOWS FROM OPERATING ACTIVITIES ............... $ 960 $ 1,093 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Purchases of property and equipment ............. (770) (1,077) Acquisitions, net ............................... (389) Increase in other assets ........................ (301) (1,339) -------- -------- (1,071) (2,805) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Decrease in notes payable - banks, net .......... (3,200) Payments of long-term debt ...................... (2,385) (1,556) Stock options exercised ......................... 1,525 297 Proceeds from issuance of stock ................. 13,441 -------- -------- (860) 8,982 -------- -------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (971) 7,270 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR ..... 9,166 2,278 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD ......... $ 8,195 $ 9,548 ======== ========
See notes to consolidated financial statements. COMPUTER HORIZONS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the Quarters Ended June 27, 1996 and June 28, 1995 The information furnished reflects all adjustments which, in the opinion of the Company, are necessary to present fairly its consolidated financial position and the results of its operations and changes in financial position for the periods indicated. Reference is made to the Company's annual financial statements for the year ended December 31, 1995, for a description of the accounting policies, which have been continued without change. Also refer to the footnotes with those annual statements for additional details of the Company's financial condition, results of operations and changes in cash flows. The details in those notes have not changed except as a result of normal transactions in the interim. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS For the Quarters Ended June 27, 1996 and June 28, 1995 For the second quarter and six months ended June 27, 1996, revenues increased to $56 million and $113 million, respectively, a 16% and 23% increase over last year's comparable periods. These increases reflect continued growth in the professional staffing and solutions businesses, when comparing the two years. Because of the unexpected termination of certain contracts in the second quarter of this year, revenues in the second quarter of 1996 dropped 2% compared to the first quarter of 1996 ($56 million vs. $57 million). As a percentage of revenues, direct costs increased to 71.3% vs. 70.7% in the second quarter of this year as compared to last year. This increase was primarily attributable to the substantial downtime incurred as a result of the unexpected contract termination. For the six months, direct costs decreased to 70.2% from 71.1%. Selling, administrative and general expenses increased as a percentage of revenues, from 21% in 1995's second quarter and first six months, to 22% in this year's comparable periods. In dollars, the expenditure increased by $2.3 million from last year, primarily due to the investment associated with our Year 2000 strategy. Other income/expense improved in the second quarter and the first six months of 1996, primarily due to the Company's equity in the operating results of its Birla Horizons joint venture, which was formed in 1995, as well as to additional interest income received and interest expense saved relating to the funds provided by the 1995 secondary public offering. Income before income taxes was adversely affected in the second quarter of 1996, by the unexpected termination of certain contracts, as well as the substantial expenditures made by the Company to build the infrastructure necessary and capable of handling the major Year 2000 conversion projects being pursued. For the second quarter 1996 vs. 1995 comparison, pre-tax income decreased to $3.7 million vs. $3.9 million. For the six months, pre-tax income increased to $9.4 million from $6.9 million, The effective tax rate for Federal, state and local income taxes was 42% for the three months and six months ended June 27, 1996, compared to 44% for the comparable 1995 periods. Net income was $2.1 million for the second quarter of 1996 vs. $2.2 million for the second quarter of 1995. Earnings per share were $.13 as compared to $.15, on 17.1 million shares in 1996's second quarter vs. 14.9 million shares a year ago. The increased shares were principally the result of a June 1995 equity financing and the accounting impact of a higher common stock price on existing stock options. Net income increased by 41% for 1996's first six months to $5.4 million vs. $3.8 million or $.32 per share vs. $.26 per share as compared to 1995's first six months. 1995's earnings per share have been restated to reflect the 50% stock distribution declared by the Company on December 12, 1995. As of June 27, 1996, the Company had a current ratio position of 3.6 to 1, a cash position of $8.2 million and available bank lines of credit of $25.0 million. The Company continuously reviews its future cash requirements, together with its available bank lines of credit and internally generated funds. The Company believes it will meet all working capital obligations and fund further development of its business for at least the next 12 months. PART II Other Information Item 6. b) No reports on Form 8-K have been filed during the quarter for which this report is filed. Signatures Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. COMPUTER HORIZONS CORP. ---------------------------------------- (Registrant) DATE: August 1, 1996 /s/ John J. Cassese -------------- ----------------------------------------- John J. Cassese, Chairman of the Board and President DATE: August 1, 1996 /s/ Bernhard Hubert -------------- ----------------------------------------- Bernhard Hubert, Executive Vice President and Chief Financial Officer (Principal Financial Officer) DATE: August 1, 1996 /s/ Michael J. Shea, CPA -------------- ----------------------------------------- Michael J. Shea, CPA Vice President and Controller (Principal Accounting Officer) EX-27 2
5 1,000 6-MOS DEC-31-1996 JUN-27-1996 8,195 0 49,093 896 0 60,526 8,224 4,568 79,984 16,699 1,432 0 0 1,783 59,449 79,984 0 113,063 0 79,328 24,182 0 124 9,429 3,989 5,440 0 0 0 5,440 .32 .32
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