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): October 1, 2013
TEAM, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-08604 | 74-1765729 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| 13131 Dairy Ashford, Suite 600 Sugar Land, Texas 77478 |
| (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.
Item 7.01. Regulation FD Disclosure.
The following information is furnished pursuant to both Item 2.02 and Item 7.01.
On October 1, 2013, we disseminated a press release announcing financial results for our first quarter of fiscal year 2014 ended August 31, 2013 and revising our earnings guidance regarding expected financial performance for our fiscal year ending May 31, 2014. The information in Exhibit 99.1 is being furnished, not filed. By furnishing the information in this Form 8-K and the attached exhibit, we are making no admission as to the materiality of any information in this Form 8-K or the exhibit.
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 enumerated in our Forms 10-K and Forms 10-Q as filed with the Securities and Exchange Commission.
Item 9.01. Financial Statements and Exhibits.
(c)
Exhibits. The following exhibit is furnished as part of Items 2.02 and 7.01 of this Current Report on Form 8-K:
Exhibit number
Description
99.1
Team, Inc.'s Press Release issued October 1, 2013
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: October 1, 2013 |
/s/ TED W. OWEN Ted W. Owen Executive Vice President and Chief Financial Officer |
EXHIBIT 99.1
SUGAR LAND, Texas, Oct. 1, 2013 (GLOBE NEWSWIRE) -- Team, Inc. (NYSE:TISI) today announced financial results for the fiscal year 2014 first quarter ended August 31, 2013. Team reported net income available to shareholders, adjusted for non-routine severance costs, of $5.0 million ($0.23 per diluted share), versus net income available to shareholders of $7.6 million ($0.36 per diluted share) for the prior year first quarter. Revenues for the current year quarter were $174 million, an 8% increase compared to revenues of $161 million for the prior year quarter.
Team has also revised its full fiscal year 2014 earnings guidance to a lower range of $1.55 to $1.85 per share. The revised revenue guidance for the year is now $765 million to $790 million.
Key Points
"We remain confident of our long-term growth and performance potential in spite of the near-term margin head-winds and the slow start for Quest. The initial $25 million stock repurchase program approved by our Board of Directors reflects this confidence," said Phil Hawk, Team's Chairman and Chief Executive Officer.
Authorization for Stock Repurchase Plan
Team's Board of Directors has authorized the repurchase, in open market transactions, of up to an initial $25 million of Team common stock effective immediately. Based upon the current market share price, the stock repurchase plan represents approximately 3% of Team's issued and outstanding shares.
GAAP Earnings
The adjusted net income available to shareholders for the current year quarter excludes $0.7 million in pre-tax, non-routine severance costs associated with the business unit realignment previously announced. Including these costs, net income available to shareholders in accordance with generally accepted accounting principles was $4.5 million, or $0.21 per diluted share. A reconciliation of net income available to shareholders, reported in accordance with generally accepted accounting principles, to adjusted net income available to shareholders is contained in the tables below.
Earnings Conference Call
In connection with this earnings release, Team will hold its quarterly conference call on Wednesday, October 2, 2013 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 877-415-3181 and use conference code 36931088 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 125 locations throughout the world. Team's common stock is traded on the New York Stock Exchange under the ticker symbol "TISI".
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) | ||
| Three Months Ended | ||
| August 31 | ||
| 2013 | 2012 | |
| (unaudited) | (unaudited) | |
| Revenues | $ 174,311 | $ 161,492 |
| Operating expenses | 125,314 | 111,956 |
| Gross margin | 48,997 | 49,536 |
| Selling, general and administrative expenses | 41,335 | 37,074 |
| Earnings from unconsolidated affiliates | 443 | 362 |
| Operating income | 8,105 | 12,824 |
| Foreign currency loss | 390 | 74 |
| Interest expense, net | 608 | 599 |
| Earnings before income taxes | 7,107 | 12,151 |
| Provision for income taxes | 2,630 | 4,496 |
| Net income | 4,477 | 7,655 |
| Less: Income attributable to non-controlling interest | (33) | 94 |
| Net income available to common shareholders | $ 4,510 | $ 7,561 |
| Earnings per common share: | ||
| Basic | $ 0.22 | $ 0.38 |
| Diluted | $ 0.21 | $ 0.36 |
| Weighted average number of shares outstanding: | ||
| Basic | 20,503 | 19,874 |
| Diluted | 21,399 | 20,866 |
| TEAM, INC. AND SUBSIDIARIES | ||
| ADDITIONAL FINANCIAL INFORMATION | ||
| (in thousands, except per share data) | ||
| Three Months Ended | ||
| August 31 | ||
| 2013 | 2012 | |
| (unaudited) | (unaudited) | |
| Adjusted Net income: | ||
| Net income available to shareholders | $ 4,510 | $ 7,561 |
| Non-routine severance costs | 742 | -- |
| Tax impact of adjustments | (275) | -- |
| Adjusted net income available to shareholders | $ 4,977 | $ 7,561 |
| Adjusted Net income per common share: | ||
| Basic | $ 0.24 | $ 0.38 |
| Diluted | $ 0.23 | $ 0.36 |
| Adjusted EBITDA: | ||
| Operating income ("EBIT") | $ 8,105 | $ 12,824 |
| Non-routine severance costs | 742 | -- |
| Adjusted EBIT | 8,847 | 12,824 |
| Depreciation and amortization | 5,383 | 4,573 |
| Non-cash compensation costs | 870 | 883 |
| Adjusted EBITDA | $ 15,100 | $ 18,280 |
| Segment Data: | ||
| Revenues: | ||
| IHT | $ 95,833 | $ 82,210 |
| MS | 65,769 | 65,327 |
| Quest | 12,709 | 13,955 |
| $ 174,311 | $ 161,492 | |
| Adjusted EBIT: | ||
| IHT | $ 10,183 | $ 9,659 |
| MS | 6,801 | 7,244 |
| Quest | (696) | 3,021 |
| Corporate and shared support | (7,441) | (7,100) |
| $ 8,847 | $ 12,824 | |
| Revenues by Service Type: | ||
| Inspection and assessment | $ 88,585 | $ 78,042 |
| Turnaround | 45,642 | 49,262 |
| On-stream services | 40,084 | 34,188 |
| $ 174,311 | $ 161,492 | |
| TEAM, INC. AND SUBSIDIARIES | ||
| SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION | ||
| AUGUST 31, 2013 AND MAY 31, 2013 | ||
| (in thousands) | ||
| August 31, | May 31, | |
| 2013 | 2013 | |
| (unaudited) | ||
| Current assets | $ 239,242 | $ 246,918 |
| Property, plant and equipment, net | 76,724 | 74,939 |
| Other non-current assets | 149,424 | 138,346 |
| Total assets | $ 465,390 | $ 460,203 |
| Current liabilities | $ 56,042 | $ 72,804 |
| Long term debt net of current maturities | 88,178 | 72,946 |
| Other non-current liabilities | 23,772 | 22,263 |
| Stockholders' equity | 297,398 | 292,190 |
| Total liabilities and stockholders' equity | $ 465,390 | $ 460,203 |
| TEAM, INC. AND SUBSIDIARIES | ||
| SUMMARY CONSOLIDATED CASH FLOW INFORMATION | ||
| AUGUST 31, 2013 AND AUGUST 31, 2012 | ||
| (in thousands) | ||
| Three Months Ended | ||
| August 31 | ||
| 2013 | 2012 | |
| (unaudited) | (unaudited) | |
| Net income | $ 4,477 | $ 7,655 |
| Depreciation, amortization and non-cash share-based compensation expense | 6,253 | 5,456 |
| Working capital changes | (12,667) | (7,464) |
| Other items affecting operating cash flow | 1,983 | 978 |
| Net cash provided by operating activities | $ 46 | $ 6,625 |
| Capital expenditures | (6,223) | (5,729) |
| Cash used for business acquisitions, net | (9,781) | (2,697) |
| Other items affecting investing cash flow | 148 | (70) |
| Net cash used in investing activities | ($15,856) | ($8,496) |
| Borrowings of debt, net | 14,870 | 1,050 |
| Cash associated with share-based payment arrangements, net | 638 | 862 |
| Net cash provided by financing activities | $15,508 | $1,912 |
| Effect of exchange rate changes | (227) | 196 |
| Change in cash and cash equivalents | $ (529) | $ 237 |
CONTACT: Ted W. Owen
(281) 331-6154