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): July 31, 2012
TEAM, Inc.
(Exact name of registrant as specified in its charter)
| Texas | 001-08604 | 74-1765729 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| 200 Hermann Drive Alvin, Texas 77511 |
| (Address of Principal Executive Offices and Zip Code) |
Registrant’s telephone number, including area code: (281) 331-6154
Not Applicable
(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 (see General Instruction A.2. below): |
||
| [ ] | 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 July 31, 2012, we disseminated a press release announcing our fiscal year 2012 financial results and our earnings guidance regarding expected financial performance for the fiscal year ending May 31, 2013. A copy of such press release is furnished herewith as Exhibit 99.1.
The information furnished in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed "filed" with the Securities and Exchange Commission nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated by reference.
This Form 8-K contains forward looking statements. We based our forward-looking statements on our current expectations, estimates and projections about ourselves and our industry. We caution that these statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In addition, we based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Accordingly, our actual results may differ materially from the future performance that we have expressed or forecast in the forward-looking statements. Differences between actual results and any future performance suggested in these forward-looking statements could result from a variety of factors, including those listed in our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. We assume no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by us, whether as new information, future events, or otherwise.
Item 9.01. Financial Statements and Exhibits.
(c)
Exhibits. The following exhibit is furnished as part of Item 2.02 of this Current Report on Form 8-K:
Exhibit number
Description
99.1
Team, Inc.'s Press Release issued July 31, 2012
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TEAM, Inc. |
||
|
Date: July 31, 2012 |
/s/ TED W. OWEN Ted W. Owen Executive Vice President and Chief Financial Officer |
EXHIBIT 99.1
ALVIN, Texas, July 31, 2012 (GLOBE NEWSWIRE) -- Team, Inc. (NYSE:TISI) today announced financial results for the fiscal year ending May 31, 2012. Team reported earnings, adjusted for non-routine items, of $34.5 million ($1.67 per diluted share), up 37% versus adjusted net income of $25.2 million ($1.26 per diluted share) for the prior year. Revenues for the year ended May 31, 2012, were $624 million, a 23% increase compared to revenues of $508 million for the prior year. Fourth quarter revenues and adjusted earnings were $188 million and $14.8 million ($0.71 per diluted share), respectively.
"We are pleased with and proud of the continued attractive development of our business this year as well as for the past decade. Over both time periods, we have achieved similar attractive growth rates," said Phil Hawk, Team's Chairman and Chief Executive Officer.
Highlights for FY2012
Non-Routine, Non-Cash Charge to Write-off Facility Development Costs
In the fourth quarter, the Company incurred a $1.7 million non-recurring, non-cash charge to write-off development costs capitalized through 2009 related to a planned new headquarters, manufacturing, equipment and training facility that was to have been constructed on a 50 acre tract of land in Houston, Texas that was acquired in 2007. The charge was due to management's decision not to pursue the development of the site. Instead, Team's existing corporate headquarters facility in Alvin, Texas will be re-purposed as a technical center for operations support and the corporate headquarters will be relocated to a leased commercial office space in Sugar Land, Texas, a suburb of Houston.
Team expects to complete the corporate relocation by the end of 2012 and to have completed construction and remodeling activities in Alvin, TX by the end of 2013. "Instead of committing $25 million of capital for new facilities as originally planned, we now expect to spend about $5 million for a new equipment center, expanded training facilities, and the re-purposing of existing space at our Alvin location as well as for the development of the corporate office lease in Sugar Land," said Ted Owen, Team's Chief Financial Officer. "We expect that the ultimate proceeds from the sale of the 50 acres of land will more than offset the capital costs associated with our revised facility plans."
GAAP Earnings
Team's net income available to shareholders reported in accordance with generally accepted accounting principles (including non-routine items) was $32.9 million ($1.59 per diluted share) as compared to $26.6 million ($1.32 per diluted share) in the prior year. Certain non-routine items have been excluded when arriving at adjusted earnings. A reconciliation of net income, reported in accordance with generally accepted accounting principles, to adjusted net income is contained in the tables below.
Earnings Guidance for Fiscal Year 2013
Team expects its revenues for the coming full fiscal year (the fiscal year ending May 31, 2013) to be in the range of $680 million to $700 million. For the same time period, net income available to shareholders is expected to be in a range of $1.85 to $2.00 per fully diluted share. Consistent with its past practice, Team does not provide specific guidance for individual quarters, but will confirm or update annual guidance at least quarterly.
Earnings Conference Call
In connection with this earnings release, Team will hold its quarterly conference call on Wednesday, August 1, 2012 at 8:00 a.m. Central Time (9:00 a.m. Eastern). The call will be broadcast over the Web and can be accessed on Team's Website, www.teamindustrialservices.com. Individuals wishing to participate in the conference call by phone may call 866-730-5768 and use conference code 90035148 when prompted.
About Team, Inc.
Headquartered near Houston, Texas, Team Inc. is a leading provider of specialty industrial services, including inspection and assessment, required in maintaining and installing high-temperature and high-pressure piping systems and vessels that are utilized extensively in the refining, petrochemical, power, pipeline and other heavy industries. Team offers these services in over 100 locations throughout the world. Team's common stock is traded on the New York Stock Exchange under the ticker symbol "TISI".
The Team, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8222
Certain forward-looking information contained herein is being provided in accordance with the provisions of the Private Securities Litigation Reform Act of 1995. We have made reasonable efforts to ensure that the information, assumptions and beliefs upon which this forward-looking information is based are current, reasonable and complete. Such forward-looking statements involve estimates, assumptions, judgments and uncertainties. There are known and unknown factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking information. Such known factors are detailed in the Company's Annual Report on Form 10-K and in the Company's Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission, and in other reports filed by the Company with the Securities and Exchange Commission from time to time. Accordingly, there can be no assurance that the forward-looking information contained herein will occur or that objectives will be achieved. We assume no obligation to publicly update or revise any forward-looking statements made today or any other forward-looking statements made by the company, whether as a result of new information, future events or otherwise.
| TEAM, INC. AND SUBSIDIARIES | ||||
| SUMMARY OF OPERATING RESULTS | ||||
| (in thousands, except per share data) | ||||
| Quarter ended May 31, | Fiscal Year | |||
| 2012 | 2011 | 2012 | 2011 | |
| Revenues | $ 187,851 | $ 161,558 | $ 623,740 | $ 508,020 |
| Operating expenses | 124,296 | 110,442 | 428,689 | 350,877 |
| Gross margin | 63,555 | 51,116 | 195,051 | 157,143 |
| Selling, general and administrative expenses | 39,621 | 32,729 | 139,737 | 115,698 |
| Earnings from unconsolidated affiliates | 272 | 275 | 1,183 | 1,030 |
| Operating income | 24,206 | 18,662 | 56,497 | 42,475 |
| Foreign currency (gain) loss | (105) | 200 | (31) | 147 |
| Interest expense, net | 611 | 785 | 2,380 | 2,156 |
| Write-off of land development costs | 1,658 | -- | 1,658 | -- |
| Earnings before income taxes | 22,042 | 17,677 | 52,490 | 40,172 |
| Provision for income taxes | 8,156 | 6,826 | 19,422 | 13,548 |
| Net income | 13,886 | 10,851 | 33,068 | 26,624 |
| Less: Income attributable to non-controlling interest | 122 | 30 | 157 | 39 |
| Net income available to common shareholders | $ 13,764 | $ 10,821 | $ 32,911 | $ 26,585 |
| Earnings per common share: | ||||
| Basic | $ 0.69 | $ 0.56 | $ 1.67 | $ 1.38 |
| Diluted | $ 0.66 | $ 0.53 | $ 1.59 | $ 1.32 |
| Weighted average number of shares outstanding: | ||||
| Basic | 19,838 | 19,473 | 19,667 | 19,206 |
| Diluted | 20,804 | 20,492 | 20,660 | 20,083 |
| Divisional revenues: | ||||
| TCM | $ 110,230 | $ 92,340 | $ 354,830 | $ 284,616 |
| TMS | 77,621 | 69,218 | 268,910 | 223,404 |
| $ 187,851 | $ 161,558 | $ 623,740 | $ 508,020 | |
| Adjusted Net income: | ||||
| Net income available to common shareholders | $ 13,764 | $ 10,821 | $ 32,911 | $ 26,585 |
| Write-off of land development costs | 1,658 | -- | 1,658 | -- |
| Legal settlement | -- | -- | 800 | -- |
| Acquisition costs | -- | -- | -- | 632 |
| Tax impact of adjustments | (613) | -- | (913) | (253) |
| Non-routine tax benefit | -- | -- | -- | (1,758) |
| Adjusted Net income | $ 14,809 | $ 10,821 | $ 34,456 | $ 25,206 |
| Adjusted Net income per common share: | ||||
| Basic | $ 0.75 | $ 0.56 | $ 1.75 | $ 1.31 |
| Diluted | $ 0.71 | $ 0.53 | $ 1.67 | $ 1.26 |
| Adjusted EBITDA: | ||||
| Operating income ("EBIT") | $ 24,206 | $ 18,662 | $ 56,497 | $ 42,475 |
| Legal settlement | -- | -- | 800 | -- |
| Acquisition costs | -- | -- | -- | 632 |
| Adjusted EBIT | 24,206 | 18,662 | 57,297 | 43,107 |
| Depreciation and amortization | 4,556 | 3,898 | 17,469 | 14,584 |
| Non-cash share-based compensation costs | 867 | 1,145 | 4,386 | 4,993 |
| Adjusted EBITDA | $ 29,629 | $ 23,705 | $ 79,152 | $ 62,684 |
| TEAM, INC. AND SUBSIDIARIES | ||
| SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION | ||
| MAY 31, 2012 AND MAY 31, 2011 | ||
| (in thousands) | ||
| May 31, | May 31, | |
| 2012 | 2011 | |
| Current assets | $ 218,675 | $ 190,274 |
| Property, plant and equipment, net | 62,041 | 58,567 |
| Other non-current assets | 123,072 | 106,645 |
| Total assets | $ 403,788 | $ 355,486 |
| Current liabilities | $ 61,656 | $ 59,741 |
| Long term debt net of current maturities | 85,872 | 75,868 |
| Other non-current liabilities | 11,259 | 10,431 |
| Stockholders' equity | 245,001 | 209,446 |
| Total liabilities and stockholders' equity | $ 403,788 | $ 355,486 |
CONTACT: Ted W. Owen
(281) 331-6154