8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): August 9, 2006

Computer Horizons Corp.

(Exact name of registrant as specified in its charter)

New York	0-7282	13-2638902
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(IRS Employer Identification No.)

49 Old Bloomfield Avenue Mountain Lakes, New Jersey 07046-1495

(Address of principal executive offices)

Registrant’s telephone number, including area code: (973) 299-4000

(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:

o Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o 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.

          The information in this Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor be deemed incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the “Exchange Act,” except as shall be expressly set forth by specific reference in such filing.

          On August 9, 2006, Computer Horizons Corp. (the “Company”) issued a press release regarding the Company’s financial results for its fiscal quarter ended June 30, 2006. The full text of the Company’s press release is attached hereto as Exhibit 99.1.

Item 9.01     Financial Statements and Exhibits.

           (d)     Exhibits.

Exhibit Number	Description
99.1	Press Release of Computer Horizons Corp. dated August 9, 2006.

2

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.

Dated:  August 9, 2006

COMPUTER HORIZONS CORP.
By:	/s/ Barbara Moss
	Barbara Moss
	Chief Financial Officer

3

EX-99.1

Exhibit 99.1

COMPUTER HORIZONS REPORTS SECOND QUARTER 2006 RESULTS

MOUNTAIN LAKES, N.J., Aug. 9 /PRNewswire-FirstCall/ - -- Computer Horizons Corp. (Nasdaq: CHRZ), a strategic solutions and professional services company, today announced its financial results for the second quarter and six months ended June 30, 2006.

Financial Highlights and Update on Strategic Alternatives Review
During the second quarter of 2006, CHC recorded consolidated revenues of $63.3 million, an 8.3 percent decline over the comparable period in 2005. CHC's Commercial unit continued a deliberate de-emphasis on certain under- performing business and a migration of some project-based work to our lower rate and lower cost off-site development centers, which contributed to the fall-off in revenues; nonetheless, gross and operating margins continue to be positive and to improve. The Company's Federal unit underperformed in revenues during the quarter due in part to re-direction of funding to more Defense and Homeland Security oriented projects, and to the time required to ramp up new business development resources. During the quarter, CHC appointed new top management at the Federal Unit. Through it all, the unit has maintained healthy margins. Chimes continues to grow, albeit somewhat less than expected due mostly to delays in implementation of new customers, and margins remain healthy.

During the second quarter, CHC reassessed the carrying value of goodwill associated with its Federal unit as of June 30, 2006. This review disclosed an impairment which required a non-cash write down of $15.0 million. Excluding the goodwill write-down, the Company reported consolidated net income for the quarter of $1.0 million, which compared favorably with performance in 2005, when the company yielded net income before taxes of $66,000. Including equity-based compensation expense of $95,000 and the goodwill write-down, the Company reported a net loss for the period of $14.1 million, or $(0.44) per diluted share. Gross margin stands at 34.4 percent, an improvement over the first quarter of 2006.

For the first six months of 2006, CHC recorded consolidated revenues of $126.9 million, a 6.4 percent decline over the comparable period in 2005. The Company reported a consolidated net loss of $13.3 million, or $(0.41) per diluted share, for the period. Net income for the first six months of 2006 included a charge associated with the write-down of goodwill in our Federal Government unit of $15.0 million. Excluding this charge, the Company reported consolidated net income for the six-month period of $1.8 million, which compared favorably with performance in the comparable period of 2005 when the Company reported net income of $574,000, which included a special credit (benefit) of $675,000, pertaining to bad debt recovery. The net loss for the six-month period also included equity-based compensation expenses of $378,000.

Commenting on second quarter 2006 performance, Dennis J. Conroy, president and chief executive officer of CHC, noted, “While some of the revenue decline was a result of our de-emphasis of low margin business in the Commercial segment, we were disappointed by overall top line results for the quarter and full six months.  However, we are encouraged by the operating performance and margins in our Commercial business, the continued growth of Chimes, and new leadership at Federal.  Moreover, we continue our work with Jefferies Broadview to finalize the review of all strategic alternatives to maximize shareholder value.”

Commenting on CHC’s financial position, Barbara Moss, CHC’s chief financial officer, said, “Our financial position remained healthy during the second quarter with cash of $36.2 million (including $17.2 million of Chimes pass through cash), no debt and $58 million in working capital.”

Looking Forward
Commenting on full year 2006 outlook, Mr. Conroy noted, "With six months of operating performance behind us, CHC now expects full year consolidated revenues in the range of $260 to $265 million, and full year diluted earnings in the range of $0.10 to $0.15 per share. With the non-cash goodwill impairment we expect to record a loss of $0.25 to $0.30 per share for the full year."

OPERATIONAL REVIEW BY BUSINESS SEGMENT
Condensed financial information is presented below for each of the Company’s business segments.  Total income/(loss) before income taxes excludes interest income/expense, amortization, and special charges/credit. [See Reconciliation of Segments Income / (Loss) Before Income Taxes to Consolidated Income / (Loss) Before Income Taxes.]
(in thousands)

	THREE MONTHS ENDED						SIX  MONTHS ENDED
	June 30, 2006			June 30, 2005			June 30, 2006			June 30, 2005
Revenues:
Commercial	$	45,643		$	50,650		$	91,482		$	99,321
Federal		9,626			11,404			19,952			22,943
Chimes		8,056			7,012			15,497			13,375
Total Revenues		63,325			69,066			126,931			135,639
Gross Profit:
Commercial		9,624			9,208			19,256			18,726
Federal		4,330			5,279			8,969			10,694
Chimes		7,834			6,816			15,098			12,868
Total Gross Profit		21,788			21,303			43,323			42,288
%		34.4	%		30.8	%		34.1	%		31.2	%
Operating Income:
Commercial		3,984			2,306			7,721			4,912
Federal		712			1,133			1,763			2,456
Chimes		1,429			1,607			2,691			2,796
Total Operating Income		6,125			5,046			12,175			10,164
%		9.7	%		7.3	%		9.6	%		7.5	%
Corporate Allocation:
Commercial		3,882			3,930			8,019			8,003
Federal		383			409			815			852
Chimes		774			612			1,528			1,206
Total Corporate Allocation		5,039			4,951			10,362			10,061
%		8.0	%		7.2	%		8.2	%		7.4	%
Total Income / (Loss) before Income Taxes:
Commercial		102			(1,624	)		(298	)		(3,091	)
Federal		329			724			948			1,604
Chimes		655			995			1,163			1,590
Total Income / (Loss) before Income Taxes	$	1,086		$	95		$	1,813		$	103
%		1.7	%		0.1	%		1.4	%		0.1	%

Reconciliation of Segments Income/ (Loss) Before Income Taxes to Consolidated Income/
(Loss) Before Income
Taxes/ (Benefit)
(in thousands)

	THREE MONTHS ENDED						SIX  MONTHS ENDED
	June 30, 2006			June 30, 2005			June 30, 2006			June 30, 2005
Total Segment Income / (Loss) Before Income Taxes:	$	1,086		$	95		$	1,813		$	103
Adjustments:
Special (charges) / credits*		(280	)		115			(280	)		790
Goodwill impairment		(15,000	)		—			(15,000	)
Amortization of intangibles		(233	)		(264	)		(466	)		(614	)
Net interest income		445			120			780			295
Total adjustments		(15,068	)		(29	)		(14,966	)		471
Consolidated Income / (Loss) Before Income Taxes	$	(13,982	)	$	66		$	(13,153	)	$	574

* For the three and six months ended June 30, 2006, $67,000 of the $280,000 of special charges relates to salary and travel expenses that are included in SG&A on the consolidated statement of operations.

Highlights from the Commercial Sector

• Revenues for the second quarter were $45.6 million, a 9.9 percent decrease from the second quarter of 2005, and flat sequentially as the division continued to de-emphasize low gross margin business while emphasizing more profitable services, clients and geographies. The decrease in revenue is also partially attributed to the continued transition of a greater percentage of its solutions business to its nearshore center, where billing rates are lower.

• Gross margin increased 290 basis points over the second quarter of 2005 and remained consistent sequentially.

• SG&A expenses decreased 18.3 percent from the second quarter of 2005.

• Net operating income increased 72.5 percent from the second quarter of 2005 and 6.5 percent sequentially as a result of executing on its strategic initiatives.

• The division was added to four new preferred vendor lists and renewed at several others throughout the quarter.

• The division announced its intent to add hundreds of new jobs in Montreal through its agreement with Invest Quebec which affords the division certain financial incentives through 2016.

• The division also completed its implementation of an enterprise wide applicant tracking system which promises to improve fill rates and gross margins through real time access to a greater candidate population.

Highlights from the Federal Government Sector 

• Revenues for the second quarter were $9.6 million, a 15.6 percent decline from the comparable period in 2005.

• RGII’s gross and operating margins remain healthy.  The Federal unit contributed $712,000 of operating income in the second quarter, excluding the goodwill write-down.

• RGII was awarded additional business from the FAA as well as two Blanket Purchase Agreements with the Department of Homeland Security for program management services and the US Air Force Surgeon General’s Office for Information Assurance Services.  Each of the BPAs provide opportunity to participate in limited competition task order RFQs issued by the covered organizations.

• Funded backlog as of June 30, 2006 for RGII was approximately $13.8 million and contracted (unfunded) backlog approximated $108.0 million.

Chimes, Inc. Highlights

• Chimes reported $8.0 million in revenue for the second quarter of 2006, a 14.9 percent increase from the comparable period in 2005, and an 8.3 percent increase over the first quarter of 2006.

• Chimes contributed operating income of more than $1.4 million in the second quarter of 2006.

• Four new customer implementations took place during the second quarter.

• During the second quarter, Chimes expanded business at four existing customers through its payroll service offering; launched early this year.

• Two new awards were obtained for workforce services business during the second quarter with companies in the telecommunications and healthcare sectors.

Computer Horizons Corp. will conduct a conference call webcast at 10:00 AM (ET) today to discuss second quarter results.  The call will be broadcast live via the Internet and can be accessed at http://www.computerhorizons.com (click on investor section).  A replay of the call will be available beginning at approximately 1:00 PM (ET) today, through 12:00 AM (ET) on August 16, 2006.  The replay may also be accessed via the Internet at http://www.computerhorizons.com (click on investor section), or by calling 877-519-4471 (973-341-3080 from outside the United States).  The confirmation code is 7627805.

About Computer Horizons Corp.
Computer Horizons Corp. (Nasdaq: CHRZ) provides professional information technology (IT) services to a broad array of vertical markets, including financial services, healthcare, pharmaceutical, telecom, consumer packaged goods, as well as the Federal government, through its wholly-owned subsidiary, RGII Technologies, Inc.  CHC’s wholly-owned subsidiary, Chimes, uses its proprietary technology to enable its Global 2000 customer base to align and integrate business planning with human resource management across an enterprise’s business functions.  For more information on Computer Horizons, visit http://www.computerhorizons.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  In some cases, forward-looking statements can be identified by words such as “believe,”  “expect,”  “anticipate,” “plan,” “potential,” “continue” or similar expressions.  Forward-looking statements also include the assumptions underlying or relating to any of the foregoing statements.  Such forward-looking statements are based upon current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements including, but not limited to, risks associated with unforeseen technical difficulties, the ability to meet customer requirements, market acceptance of service offerings, changes in technology and standards, the ability to complete cost reduction initiatives, dependencies on certain technologies, delays, market acceptance and competition, as well as other risks described from time to time in the Company’s filings with the Securities and Exchange Commission, press releases and other communications.  All forward-looking statements included in this press release are based on information available to the Company on the date hereof.  The Company undertakes no obligation (and expressly disclaims any such obligation) to update forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to update reasons why actual results would differ from those anticipated in such forward-looking statements.

Corporate Contacts:	David Reingold/Lauren Felice
	Investor Relations, Marketing
	Computer Horizons Corp.
	(973) 299-4105/4061
	dreingold@computerhorizons.com
	TTTlfelice@computerhorizons.com

COMPUTER HORIZONS CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(Unaudited – In thousands except per share data)

	THREE MONTHS ENDED						SIX MONTHS ENDED
	Jun. 30 2006			Jun. 30 2005			Jun. 30 2006			Jun. 30 2005
Revenues
Commercial	$	45,643		$	50,650		$	91,482		$	99,321
Federal		9,626			11,404			19,952			22,943
Chimes		8,056			7,012			15,497			13,375
Total		63,325			69,066			126,931			135,639
Direct Costs		41,537			47,763			83,608			93,351
Gross Profit		21,788			21,303			43,323			42,288
Selling, General & Admin.		20,763			21,208			41,577			42,185
Special Charges / (Credits)		219			(115	)		213			(790	)
Goodwill impairment		15,000			—			15,000			—
Amortization of Intangibles		233			264			466			614
Income / (Loss) from Operations		(14,427	)		(54	)		(13,933	)		279
Net Interest Income		445			120			780			295
Income / (Loss) Before Income Taxes		(13,982	)		66			(13,153	)		574
Income (Taxes) / Benefit		(69	)		(22	)		(140	)		(200	)
Net Income / (Loss)	$	(14,051	)	$	44		$	(13,293	)	$	374
Earnings / (Loss) per share - Basic	$	(0.44	)	$	0.00		$	(0.41	)	$	0.01
Weighted Average Number of Shares Outstanding - Basic		32,247,000			31,272,000			32,280,000			31,232,000
Earnings (Loss) per share - Diluted	$	(0.44	)	$	0.00		$	(0.41	)	$	0.01
Weighted Average Number of Shares Outstanding - Diluted		32,247,000			31,451,000			32,280,000			31,488,000

COMPUTER HORIZONS CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited – In thousands)

	June 30, 2006			December 31, 2005
ASSETS
Current Assets:
Cash and cash equivalents*	$	36,224		$	46,365
Accounts receivable, less allowance for doubtful accounts		50,784			48,124
Refundable income taxes		6,704			6,430
Other receivables		2,591			—
Prepaid expenses and other		3,422			4,108
Total Current Assets		99,725			105,027
Property and equipment, net		4,368			5,065
Other assets - net:
Goodwill		10,034			27,625
Intangibles		1,472			1,938
Deferred income taxes		1,484			—
Other assets		3,260			3,687
Total Assets	$	120,343		$	143,342
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable*	$	22,637		$	36,252
Accrued payroll, payroll taxes and benefits		11,070			10,548
Income taxes payable		1,150			1,150
Restructuring reserve		643			1,668
Deferred compensation		577			—
Deferred income taxes		1,511			—
Other accrued expenses		4,136			4,005
Total Current Liabilities		41,724			53,623
Deferred compensation		1,653			2,468
Change of Control Payable		2,316			2,938
Other liabilities		222			286
Total Liabilities		45,915			59,315
Shareholders’ Equity:
Common stock		3,315			3,315
Additional paid in capital		146,638			148,083
Accumulated comprehensive loss		(136	)		(643	)
Retained earnings / (deficit)		(73,785	)		(60,492	)
		76,032			90,263
Less treasury shares		(1,604	)		(6,236	)
Total Shareholders’ Equity		74,428			84,027
Total Liabilities and Shareholders’ Equity	$	120,343		$	143,342

* Cash and cash equivalents at June 30, 2006 and December 31, 2005 include approximately $17.2 million and $29.4 million, respectively, of cash to be disbursed to Chimes vendors (i.e., accounts payable) in accordance with the client payment terms.

COMPUTER HORIZONS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited – In thousands)

	June 30, 2006			June 30, 2005
Cash flows from operating activities
Net income / (loss)	$	(13,293	)	$	374
Adjustments to reconcile net loss to net cash provided by/(used in) operating activities:
Deferred taxes		27			76
Depreciation		1,372			2,046
Amortization of intangibles		466			614
Provision for bad debts		289			388
Gain on sale of assets		—			(327	)
FAS 123 R option expense		378			—
Goodwill impairment		15,000			—
Changes in assets and liabilities, net of acquisitions:
Accounts receivable		(2,949	)		(175	)
Prepaid expenses and other current assets		796			1,959
Other assets		426			(40	)
Refundable income taxes		(274	)		(790	)
Accrued payroll, payroll taxes and benefits		522			254
Accounts payable		(13,615	)		7,593
Income taxes payable		—			107
RGII contingency payments		—			(1,851	)
Other accrued expenses, change of control and restructuring reserve		(1,536	)		(4,502	)
Deferred compensation		(238	)		(2	)
Supplemental executive retirement plan		—			(115	)
Other liabilities		(174	)		(131	)
Net cash provided by / (used in) operating activities		(12,803	)		5,478
Cash flows from investing activities
Deferred merger costs		—			(2,426	)
Proceeds from sale of assets		—			563
Purchases of furniture and equipment		(674	)		(1,523	)
Net cash provided by / (used in) investing activities		(674	)		(3,386	)
Cash flows from financing activities
Stock options exercised		2,582			175
Stock issued on employee stock purchase plan		247			357
Net cash provided by / (used in) financing activities		2,829			532
Foreign currency gains/ (losses)		507			(419	)
Net increase/ (decrease) in cash and cash equivalents		(10,141	)		2,205
Cash and cash equivalents at beginning of year		46,365			33,649
Cash and cash equivalents at end of period	$	36,224		$	35,854

# # #

SOURCE  Computer Horizons Corp.
           -0-                                                                      08/09/2006
           /CONTACT:   David Reingold, Investor Relations, +1-973-299-4105, dreingold@computerhorizons.com, or Lauren Felice, Marketing, +1-973-299-4061, TTTlfelice@computerhorizons.com, both of Computer Horizons Corp. /
           /Web site:  http://www.computerhorizons.com /
           (CHRZ)