8-K

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) — May 15, 2008

BELL INDUSTRIES, INC.

(Exact name of Registrant as specified in its Charter)

California	001-11471	95-2039211
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

8888 Keystone Crossing, Suite #1700, Indianapolis, IN	46240
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (317) 704-6000

                                        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:

o     Written communications 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.

     On May 15, 2008, Bell Industries, Inc. (the “Company”) issued a press release describing selected financial results of the Company for the quarter ended March 31, 2008. A copy of the press release is attached hereto as Exhibit 99.1 and is being furnished under Item 2.02, to this Report.

     The information hereunder shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be incorporated by reference into any registration statement or other document pursuant to Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

     As discussed therein, the press release contains forward-looking statements within the meaning of the Securities Act and the Exchange Act and, as such, may involve known and unknown risks, uncertainties and assumptions. These forward-looking statements relate to the Company’s current expectations and are subject to the limitations and qualifications set forth in the press release as well as in the Company’s other documents filed with the SEC, including, without limitation, that actual events and/or results may differ materially from those projected in such forward-looking statements.

Item 9.01 Financial Statements and Exhibits.

(d)	Exhibits.
99.1	Press Release of Bell Industries, Inc. dated May 15, 2008.

SIGNATURES

     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.

	BELL INDUSTRIES, INC.
Date: May 20, 2008	By:	/s/ Kevin J. Thimjon
	Name:	Kevin J. Thimjon
	Title:	President and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press Release of Bell Industries, Inc. dated May 15, 2008.

EX-99.1

Exhibit 99.1

CONTACT:

Bell Industries, Inc.
Kevin Thimjon, President and CFO
317-704-6000

BELL INDUSTRIES REPORTS FINANCIAL RESULTS
FOR 2008 FIRST QUARTER

     INDIANAPOLIS — May 15, 2008 — Bell Industries, Inc. (BIUI.PK) today reported financial results for its first quarter ended March 31, 2008.

     Revenues from continuing operations for the 2008 first quarter were $23.1 million down 21.9% from $29.5 million a year ago, with $5.7 million of the decrease in revenues related to the company’s Technology Solutions Group. The company incurred a loss from continuing operations of $680,000, or $0.06 per diluted share, for the 2008 first quarter. This reflects a significant improvement over the prior-year first quarter loss from continuing operations of the $1.8 million, or $0.22 per diluted share, which included a $2.0 million gain from the sale of a building. Bell achieved net income in the first quarter of 2008 of $839,000, or $0.09 per diluted share, including income from discontinued operations of $1.5 million, equal to $0.15 per diluted share. This compares with a net loss of $1.5 million, or $0.18 per diluted share, including income from discontinued operations of $334,000, or $0.04 per diluted share, for the 2007 first quarter.

     The company announced in February 2008 that it completed the sale of SkyTel’s automated vehicle location business to SkyGuard LLC for $7.0 million. In March 2008, Bell entered into a definitive agreement to sell the balance of its SkyTel division to Velocita Wireless LLC for a total consideration of $8.0 million, comprised of $3.0 million in cash at closing and deferred payments totaling $5.0 million to be paid over a period of two years. As a result of these transactions, the SkyTel division has been reflected as a discontinued operation in the company’s results of operations for the first quarters of 2008 and 2007 and is reflected on the balance sheet at March 31, 2008 as assets held for sale.

     The Technology Solutions Group posted revenues of $13.2 million for the 2008 first quarter, compared with $18.9 million in the 2007 first quarter. This decline is related to several factors, including the termination of an unprofitable large-scale customer relationship management engagement in conjunction with the closing of Bell’s Springfield, Missouri call center, the decision to cease acting as an authorized reseller for a certain hardware product line, the timing of completion of certain projects and a focus on improving gross profits. Operating income for the 2008 first quarter amounted to $424,000, increasing by approximately $1.5 million over the prior-year first quarter due to several factors, including the closure of the unprofitable Springfield call

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Bell Industries, Inc.
2-2-2
 

center, improved operational efficiencies on several service engagements and significant reductions in overhead costs.

     Bell’s Recreational Products Group reported revenues of $9.9 million for the 2008 first quarter, compared with $10.7 million in the 2007 first quarter. The company attributed the decrease in revenues primarily to lower sales in the marine and recreational vehicle product lines, partially offset by an increase in revenues from its snowmobile product line. Although revenues were down year-over-year, operating income for the 2008 first quarter increased by $566,000 over the prior-year first quarter to $188,000, principally reflecting a 230 basis point improvement in gross profit margins and reductions in headcount, freight and facility costs.

     “We continue to make progress improving the operational efficiencies of each of our businesses,” said Kevin J. Thimjon, president and chief financial officer of Bell Industries. “We are particularly pleased with the significantly reduced corporate cost structure of our business, which was decreased by nearly 52 percent over the prior-year period, as a result of reductions in headcount and related travel and benefits, the closure of our former corporate headquarters in Los Angeles and lower marketing and telecommunications expenses.”

     Bell’s corporate costs for the 2008 first quarter totaled $1.1 million, down almost $1.3 million from $2.4 million in the 2007 first quarter”

About Bell Industries, Inc.

     After the completion of the recently announced sale of its SkyTel division, Bell Industries will be comprised of two operating units, Bell’s Technology Solutions business and its Recreational Products Group. The company’s Technology Solutions business offers a comprehensive portfolio of customizable and scalable technology solutions ranging from managed technology services to reverse logistics and mobile/wireless solutions. The Recreational Products Group is a wholesale distributor of aftermarket parts and accessories for the recreational vehicles and other leisure-related vehicle markets, including marine, snowmobile, cycle and ATV.

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. These statements, including, but not limited to the encouragement by the cost reductions achieved in the businesses, are based upon current expectations and speak only as of the date hereof. Actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including uncertainties as to the nature of the company’s industry, including changing customer demand, the impact of competitive products and pricing, dependence on existing management and general economic conditions. Bell Industries’ Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other SEC filings discuss some of the important risk factors that may affect the business, results of operations and financial condition. The company undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

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(Tables Follow)

Bell Industries, Inc.
Consolidated Operating Results
(In thousands, except per share data)
(Unaudited)

	Three months ended
	March 31,
	2008			2007
Net revenues:
Products	$	15,730		$	19,355
Services		7,358			10,190
Total net revenues		23,088			29,545
Costs and expenses:
Cost of products sold		12,760			16,327
Cost of services provided		4,939			7,257
Selling, general and administrative expense		5,914			9,755
Interest expense, net		139			—
Gain on sale of assets		—			(1,976	)
Total costs and expenses		23,752			31,363
Loss from continuing operations before provision for income taxes		(664	)		(1,818	)
Provision for income taxes		16			23
Loss from continuing operations		(680	)		(1,841	)
Income from discontinued operations, net of tax		1,519			334
Net income (loss)	$	839		$	(1,507	)
Share and per share data
Basic:
Loss from continuing operations	$	(0.08	)	$	(0.22	)
Income from discontinued operations		0.18			0.04
Net income (loss)	$	0.10		$	(0.18	)
Weighted average common shares outstanding		8,650			8,600
Diluted:
Loss from continuing operations	$	(0.06	)	$	(0.22	)
Income from discontinued operations		0.15			0.04
Net income (loss)	$	0.09		$	(0.18	)
Weighted average common shares outstanding		11,467			8,600
OPERATING RESULTS BY BUSINESS SEGMENT
Net revenues:
Technology Solutions Group
Products	$	5,839		$	8,683
Services		7,358			10,190
Total Technology Solutions Group		13,197			18,873
Recreational Products Group		9,891			10,672
Total net revenues	$	23,088		$	29,545
Operating income (loss):
Technology Solutions Group	$	424		$	(1,052	)
Recreational Products Group		188			(378	)
Corporate costs		(1,137	)		(2,364	)
Total operating loss		(525	)		(3,794	)
Gain (loss) on sale of assets		—			(1,976	)
Interest expense, net		139			—
Loss from continuing operations before income taxes	$	(664	)	$	(1,818	)

Bell Industries, Inc.
Consolidated Condensed Balance Sheet
(In thousands)

	March 31,		December 31,
	2008		2007
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,001	$	409
Accounts receivable, net		14,712		12,304
Inventories, net		9,741		10,323
Prepaid expenses and other current assets		1,743		1,982
Assets held for sale		21,831		27,814
Total current assets		49,028		52,832
Fixed assets, net		2,215		1,956
Assets held for sale		5,000		5,000
Other assets		1,681		2,231
Total assets	$	57,924	$	62,019
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Floor plan payables	$	781	$	1,064
Revolving credit facility		3,404		4,775
Accounts payable		9,085		10,438
Accrued payroll		2,149		1,639
Liabilities associated with assets held for sale		17,225		19,084
Other accrued liabilities		4,934		5,849
Total current liabilities		37,578		42,849
Convertible note		9,209		8,969
Other long-term liabilities		5,461		5,418
Total liabilities		52,248		57,236
Shareholders’ equity		5,676		4,783
Total liabilities and shareholders’ equity	$	57,924	$	62,019