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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):
NOVEMBER 19, 1999 (NOVEMBER 10, 1999)
SCB COMPUTER TECHNOLOGY, INC.
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(Exact name of registrant as specified in its charter)
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TENNESSEE 0-27694 62-1201561
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State or other jurisdiction of Commission File Number IRS Employer Identification
incorporation Number
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1365 BRIERBROOK ROAD, MEMPHIS, TENNESSEE 38138
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(Address of Principal executive offices) (Zip Code)
Registrant's telephone number, including area code (901) 754-6577
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NOT APPLICABLE
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(Former name or former address, if changed since last report)
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INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5. OTHER EVENTS.
On November 18, 1999, SCB Computer Technology, Inc. issued the press
release attached hereto as Exhibit 99, which is incorporated herein by
reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
The following exhibit is filed as a part of this report.
99. Press Release dated November 18, 1999.
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 thereunto duly authorized.
SCB COMPUTER TECHNOLOGY, INC.
November 19, 1999 By: /s/ Gordon L. Bateman
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Gordon L. Bateman
Chief Administrative Officer and Secretary
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Exhibit 99
SCB Computer Technology, Inc.
1365 West Brierbrook Road
Memphis, Tennessee 38138
COMPANY PRESS RELEASE
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Contact: Ben C. Bryant, Jr. Gary E. McCarter
President and Chief Chief Financial Officer
Executive Officer 901-754-6577
901-754-6577
SCB COMPUTER TECHNOLOGY REPORTS SECOND QUARTER RESULTS
MEMPHIS, Tenn. (November 18, 1999) -- SCB Computer Technology, Inc.
(Nasdaq:NM/SCBI) today announced results for its second quarter ended October
31, 1999.
Revenues for the second quarter increased 9% to $42.8 million compared
with $39.3 million a year ago. Earnings for the quarter were $1.4 million, or
$0.06 per share (diluted), compared with $2.2 million, or $0.09 per share
(diluted), in the second quarter last year. Earnings for the second quarter
ended October 31, 1998, reflect the $0.8 million, or $0.02 per share,
non-recurring charge for severance payments to a former officer of the Company.
Revenues for the six months ended October 31, 1999, increased 16.5% to
$87.1 million compared with $74.8 million in the same period a year ago.
Earnings were $3.6 million, or $0.15 per share (diluted), compared with $3.0
million, or $0.12 per share (diluted), in the same period a year ago. Earnings
for the six months ended October 31, 1998, reflect the $1.9 million, or $0.06
per share, non-recurring charge incurred to settle the Tennessee Valley
Authority billing matter and the $0.8 million, or $0.02 per share, non-recurring
charge for severance payments to a former officer of the Company.
Commenting on the results, Ben C. Bryant, Jr., president and chief
executive officer, said, "Our second quarter results are in line with our
earnings pre-announcement of October 4, 1999. Earnings for the second quarter
primarily reflect a lower billable headcount in the Company's
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Page II
November 18, 1999
Professional Services division, the continuing shift in client needs to new
technologies and industry-wide delays in Information Technology (IT) projects.
While these factors have had a short-term, adverse impact on our results, we
have implemented strategies that reflect the changes in the industry, and we
believe that the overall demand for IT professional services post-year end will
be strong.
"The enterprise solutions and IT strategy consulting areas of our
business continues to grow. We are ramping up the delivery of these services to
clients and are pleased with how they are being received. Recently we launched
NetCardia(R), our suite of remote enterprise management services designed to
control the rapidly escalating costs of IT infrastructure management. We remain
optimistic about SCB's long-term prospects."
The Company also announced that Joseph W. McLeary (60) and T. Scott
Cobb (62) have resigned from the Company's Board of Directors. Bryant went on to
say, "On behalf of SCB, I want to thank Joe and Scott for their years of
service. SCB appreciates the many valuable contributions each has made over the
years. We wish each of them well in the future." A search is underway for
additional independent directors. Mr. Bryant will also serve as Chairman of the
Board.
Bryant stated, "It has been a great pleasure to have worked with Scott
Cobb for over 23 years in building SCB into the successful public company it is
today. While Scott transitions into a less active role with the Company, he will
remain one of our largest shareholders, and we will continue to appreciate his
input regarding the Company's mission, goals and business strategies. We look
forward to capitalizing on the many exciting opportunities in the IT industry."
Certain statements contained in this press release and related
statements by management may be deemed to be forward-looking statements. These
forward-looking statements involve a number of risks and uncertainties including
the Company's uncertainty regarding the level of acceptance of Enterprise
Management Services (EMS) by the Company's customers, uncertainty of the timing
of completion of EMS ramp-up, the risk that competition for skilled personnel
could cause higher turnover in spite of the Company's expanded investment in its
personnel, and other risks described in the Company's filings with the
Securities and Exchange Commission. The Company undertakes no obligation to
update this forward-looking information, except as required by law.
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Page III
November 18, 1999
SCB Computer Technology is a leading provider of information technology
(IT) management and technical services to Fortune 1000 companies, state and
local governments and other large organizations. The Company's services
primarily consist of: (1) IT CONSULTING, including evaluation, design and
re-engineering of computer systems, management, quality assurance and technical
direction for IT projects, as well as functional expertise and training; (2)
OUTSOURCING, including system development and integration, maintenance, data
center management, help desk and technical services, remote processing, computer
hardware sales and leasing; (3) ENTERPRISE RESOURCE PLANNING (ERP) services,
which include planning and evaluation, systems analysis and administration,
implementation and functional support; and (4) PROFESSIONAL STAFFING, which
involves providing skilled IT staff on an as-needed basis; and (5) E-SERVICES,
which include Enterprise Management Services, Internet application development
and design and implementation of communication networks.
For additional information, visit SCB's home page at:
http://www.scb.com
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Page IV
November 18, 1999
SCB COMPUTER TECHNOLOGY, INC.
FINANCIAL HIGHLIGHTS
(in thousands, except per share amounts)
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THREE MONTHS ENDED SIX MONTHS ENDED
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10/31/99 10/31/98 10/31/99 10/31/98
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Revenue $ 42,813 $ 39,281 $ 87,081 $ 74,769
Cost of services 30,292 26,946 60,987 50,988
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Gross profit 12,521 12,335 26,094 23,781
SG&A expenses:
SG&A expenses 8,402 5,806 16,727 11,312
Provision for settlement of
TVA matter -- -- -- 1,900
Amortization of goodwill and
non-leasing depreciation 808 683 1,540 1,374
Severance payments -- 800 -- 800
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Total SG&A expenses 9,210 7,289 18,267 15,386
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Income from operations 3,311 5,046 7,827 8,395
Other income (expense):
Interest expense/other (987) (1,526) (1,833) (2,782)
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Income before taxes 2,324 3,520 5,994 5,613
Income taxes (benefit) 928 1,369 (2,399) 2,566
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Net income $ 1,396 $ 2,151 $ 3,595 $ 3,047
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Net income per share:
Basic $ 0.06 $ 0.09 $ 0.15 $ 0.12
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Diluted $ 0.06 $ 0.09 $ 0.15 $ 0.12
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Weighted average of common
and common equivalent shares
outstanding:
Basic 24,711,924 24,671,661 24,711,924 24,668,490
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Diluted 24,711,924 24,844,604 24,737,285 24,979,386
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SELECTED BALANCE SHEET HIGHLIGHTS
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10/31/99 4/30/99
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Cash and cash equivalents $ 2,200 $ 5,318
Current Assets $ 46,514 $ 49,903
Total assets $ 146,890 $ 146,847
Long-term debt (excluding non-recourse debt) $ 28,894 $ 35,393
Shareholders' equity $ 63,026 $ 59,426
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