<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[MARK ONE]
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended SEPTEMBER 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission File No. 0-22195
AHL SERVICES, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
GEORGIA 58-2277249
- ----------------------------------- ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3353 Peachtree Road, NE, Atlanta, GA 30326
- ------------------------------------------ ---------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (404) 267-2222
------------------
Not Applicable
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last
report.
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 14,096,522 shares on November
6, 1998.
<PAGE> 2
AHL SERVICES, INC.
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C> <C>
PART I FINANCIAL INFORMATION
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets 1
September 30, 1998 (Unaudited) and December 31, 1997
Condensed Consolidated Statements of Operations (Unaudited) 2
Three Months Ended September 30, 1998 and 1997
Condensed Consolidated Statements of Operations (Unaudited) 3
Nine Months Ended September 30, 1998 and 1997
Condensed Consolidated Statements of Cash Flows (Unaudited) 4
Nine Months Ended September 30, 1998 and 1997
Notes to Condensed Consolidated Financial Statements 5
ITEM 2. Management's Discussion and Analysis of Financial 6
Condition and Results of Operations
PART II OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K 10
SIGNATURE 11
</TABLE>
<PAGE> 3
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
AHL SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
ASSETS 1998 1997
------------- ------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash $ 11,325 $ 15,456
Accounts receivable, net 112,193 51,247
Work-in-process 6,868 --
Uniforms in service, net 2,308 2,087
Prepaid expenses and other 6,224 2,761
----------- -----------
Total current assets 138,918 71,551
Property and equipment, net 21,882 10,885
Intangibles, net 166,188 25,665
Other assets 1,272 713
Deferred taxes 980 980
----------- -----------
$ 329,240 $ 109,794
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 14,165 $ 3,298
Accrued payroll and other current liabilities 53,189 22,561
Customer deposits 8,115 --
Current portion of self-insurance reserves 980 760
Income taxes payable 3,121 1,281
Deferred income taxes 521 332
Current portion of long-term debt 492 496
----------- -----------
Total current liabilities 80,583 28,728
----------- -----------
Long-term debt, less current portion 133,027 3,495
----------- -----------
Convertible subordinated debenture 10,000 --
----------- -----------
Self-insurance reserves, less current portion 3,920 3,040
----------- -----------
Other non-current liabilities 912 --
----------- -----------
SHAREHOLDERS' EQUITY:
Preferred stock, no par value; 5,000,000 shares authorized; no shares
issued or outstanding -- --
Common stock, $.01 par value; 50,000,000 shares authorized; 14,072,672
and 13,605,000 shares issued and outstanding 141 136
Paid in capital 79,988 62,908
Cumulative translation adjustment 341 (83)
Retained earnings 20,328 11,570
----------- -----------
Total shareholders' equity 100,798 74,531
----------- -----------
$ 329,240 $ 109,794
=========== ===========
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
1
<PAGE> 4
AHL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30,
--------------------------------
1998 1997
-------- --------
<S> <C> <C>
Revenues $135,813 $ 72,369
-------- --------
Operating expenses:
Cost of services 94,505 53,242
Field operating 27,560 11,880
Corporate general and administrative 4,858 4,041
-------- --------
Total operating expenses 126,923 69,163
-------- --------
Operating income 8,890 3,206
Interest expense, net 1,472 177
Other (income) expense, net 7 (201)
-------- --------
Income before income taxes 7,411 3,230
Income tax provision 3,043 1,210
-------- --------
Net income $ 4,368 $ 2,020
======== ========
Net income per common and common equivalent share
Basic $ 0.31 $ 0.19
======== ========
Diluted $ 0.30 $ 0.18
======== ========
Weighted average common and common equivalent shares
Basic 13,958 10,853
======== ========
Diluted 14,579 11,188
======== ========
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
2
<PAGE> 5
AHL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------
1998 1997
--------- ---------
<S> <C> <C>
Revenues $ 319,184 $ 196,563
--------- ---------
Operating expenses:
Cost of services 230,102 146,011
Field operating 59,054 32,146
Corporate general and administrative 13,905 11,144
--------- ---------
Total operating expenses 303,061 189,301
--------- ---------
Operating income 16,123 7,262
Interest expense, net 1,686 995
Other (income), net (292) (443)
--------- ---------
Income before income taxes and extraordinary items 14,729 6,710
Income tax provision 5,971 2,585
--------- ---------
Income before extraordinary items 8,758 4,125
Extraordinary items, net of taxes of $257 -- (385)
--------- ---------
Net income $ 8,758 $ 3,740
========= =========
Income before extraordinary items per common and
common equivalent share
Basic $ 0.64 $ 0.41
========= =========
Diluted $ 0.61 $ 0.40
========= =========
Extraordinary items per common and common equivalent
share
Basic $ -- $ (0.04)
========= =========
Diluted $ -- $ (0.04)
========= =========
Net income per common and common equivalent share
Basic $ 0.64 $ 0.37
========= =========
Diluted $ 0.61 $ 0.36
========= =========
Weighted average common and common equivalent shares
Basic 13,726 10,075
========= =========
Diluted 14,304 10,331
========= =========
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
3
<PAGE> 6
AHL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------
1998 1997
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 8,758 $ 3,740
Adjustments to reconcile net income to net cash provided by (used in)
operating activities:
Extraordinary items -- 385
Depreciation and amortization 5,695 4,099
Gain on sales of property and equipment (297) (119)
Changes in working capital, net (19,613) (6,316)
--------- ---------
Net cash provided by (used in) operating activities (5,457) 1,789
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions (125,002) (10,768)
Purchases of property and equipment (7,603) (1,933)
Proceeds from sales of property and equipment 1,654 440
Other activities, net (86) (32)
--------- ---------
Net cash (used in) investing activities (131,037) (12,293)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of credit facility (64,038) (80,580)
Borrowings under credit facility 196,700 75,500
Repayment of long-term debt, net (423) (6,298)
Repayment of note from shareholder -- 964
Proceeds from exercise of stock options 108 --
Proceeds from IPO -- 23,250
Expenses of IPO -- (1,247)
Repurchase of outstanding warrants -- (750)
--------- ---------
Net cash provided by financing activities 132,347 10,839
--------- ---------
Effect of exchange rates on cash 16 (75)
--------- ---------
Net change in cash (4,131) 260
Cash at beginning of period 15,456 1,842
--------- ---------
Cash at end of period $ 11,325 $ 2,102
========= =========
CASH PAID DURING THE PERIOD FOR:
Interest $ 938 $ 989
========= =========
Income taxes $ 4,131 $ 1,952
========= =========
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Convertible subordinated debenture issued for the Gage acquisition $ 10,000 $ --
========= =========
Common stock issued for the Gage acquisition $ 17,000 $ --
========= =========
Equipment purchases under capital lease obligations $ -- $ 472
========= =========
Contribution of real estate $ -- $ 1,637
========= =========
Forgiveness of note payable to shareholder $ -- $ 528
========= =========
Assumption of real estate debt $ -- $ (2,532)
========= =========
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
4
<PAGE> 7
AHL SERVICES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1998
(UNAUDITED)
1. SUMMARY OF PRESENTATION - The condensed consolidated financial
statements included herein have been prepared by AHL Services, Inc.
("AHLS" or the "Company), without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations, although the Company believes that the disclosures are
adequate to make the information not misleading. In the opinion of
management, the condensed consolidated financial statements contain all
adjustments necessary to present fairly the financial position of the
Company as of September 30, 1998, the results of its operations for the
three and nine months ended September 30, 1998 and 1997 and the results
of its cash flows for the nine months ended September 30, 1998 and
1997. All such adjustments are of a normal recurring nature. The
results of operations for the three and nine months ended September 30,
1998 are not necessarily indicative of the results to be expected for
the year ended December 31, 1998. For further information, refer to the
consolidated financial statements and footnotes thereto for the year
ended December 31, 1997 included in the Company's annual report on
Form 10-K for such period.
2. ACQUISITIONS - On February 6, 1998, the Company acquired SES Staffing
Solutions, Inc. ("SES"), a light industrial staffing company located in
Maryland. SES's 1997 revenues were approximately $16 million.
On April 1, 1998, the Company acquired TUJA Zeitarbeit GmbH ("TUJA"), a
Germany based industrial staffing company. TUJA had revenues of
approximately $16 million in 1997.
On July 24, 1998, the Company acquired Gage Marketing Support Services
Group ("Gage"), the marketing execution and fulfillment businesses of
the Minneapolis-based Gage Marketing Group, LLC for a purchase price of
$81.1 million, comprised of $54.1 million in cash, $17 million in the
Company's common stock and a $10 million convertible subordinated
debenture. Gage had revenues of approximately $80 million in 1997.
On July 30, 1998, the Company acquired EMD Gesellschaft fur
Elektroinstallation-und Maschinenbau-Dienstleistungen GmbH ("EMD") for
a cash purchase price of approximately $42 million. EMD is an
industrial staffing company headquartered near Frankfurt, Germany with
1997 revenues of approximately $50 million.
On August 31, 1998, the Company acquired Right Associates Employment
Limited ("Right Associates"), a light industrial staffing company
operating in the south of England. Right Associates had revenues of
approximately $16 million in 1997.
5
<PAGE> 8
The results of operations of these acquisitions have been included in
the attached condensed consolidated financial statements included
herein since the dates of acquisition. These acquisitions were
accounted for using the purchase method of accounting. As a result, the
purchase prices have been allocated to the assets acquired, including
intangibles, based on their respective fair values. The purchase price
allocations are preliminary and subject to adjustment.
3. ANNOUNCED ACQUISITIONS SUBSEQUENT TO SEPTEMBER 30, 1998 - On October
27, 1998, the Company agreed to acquire Unicco Security Services, Inc.
("Unicco"), a subsidiary of USC, Inc., for $12 million in cash. Unicco
is an access control and security services company operating under
long-term contracts with clients with a geographic focus primarily in
the northeastern United States and Chicago. Unicco had annual revenues
of more than $50 million in 1997. Subject to certain conditions, this
transaction is scheduled to close by December 31, 1998.
Item 2 - Management's Discussion and Analysis of Financial Condition and Results
of Operations
Operating Results - Three Months Ended September 30, 1998 and 1997 Revenues
increased $63.4 million, or 88%, to $135.8 million in the third quarter of 1998
from $72.4 million in the third quarter of 1997. Of this increase, approximately
$50.7 million was attributable to the acquisitions owned less than one year. The
remaining increase was a result of providing additional services to existing
clients, entering into contracts to provide services to new clients and rate
increases on existing contracts.
Cost of services represents the direct costs attributable to a specific
contract, predominantly wages and related benefits, as well as certain related
expenses such as workers' compensation and other direct labor related expenses.
Cost of services increased $41.3 million, or 78%, to $94.5 million in the third
quarter of 1998 from $53.2 million in the third quarter of 1997. As a percentage
of revenues, cost of services decreased to 69.6% in the third quarter of 1998
from 73.6% in the third quarter of 1997. This decrease was primarily due to the
effect of the growth in revenues of the Company's higher margin marketing
execution and fulfillment services and operational support services businesses.
Field operating expenses represent expenses which directly support field
operations, such as each district's management, facilities expenses (such as
rent, communication costs and taxes), employee uniforms, equipment leasing,
depreciation and maintenance, local sales and marketing activities and
acquisition related goodwill. These expenses increased $15.7 million, or 132%,
to $27.6 million in the third quarter of 1998 from $11.9 million in the third
quarter of 1997. As a percentage of revenues, field operating expenses increased
to 20.3% in the third quarter of 1998 from 16.4% in the third quarter of 1997.
This percentage increase was primarily attributable to the facility expenses of
Gage, the Company's newly acquired marketing execution and fulfillment services
business, and the amortization of acquisition related goodwill in 1998.
Corporate general and administrative expenses, which includes the cost of
services the Company provides to support and manage its field activities,
increased $817,000, or 20%, to $4.9 million in the third quarter of 1998 from
$4.0 million in the third quarter of 1997. As a percentage of revenues, these
expenses decreased to 3.6% in the third quarter of 1998 from 5.6% in the third
6
<PAGE> 9
quarter of 1997. This percentage decrease was primarily due to better leveraging
of corporate personnel.
Operating income increased $5.7 million, or 177%, to $8.9 million in the third
quarter of 1998 from $3.2 million in the third quarter of 1997. As a percentage
of revenues, operating income improved to 6.5% in the third quarter of 1998 from
4.4% in the third quarter of 1997.
Interest expense, net, increased $1.3 million, to $1.5 million in the third
quarter of 1998 from $177,000 in the third quarter of 1997. Interest expense
increased in 1998 due to the use of the Company's credit facility to fund
acquisitions made in 1998.
Income tax provision increased $1.8 million or 152%, to $3.0 million in the
third quarter of 1998 from $1.2 million in the third quarter of 1997. The
Company provided income taxes at a rate of 41.0% in 1998 and 37.5% in 1997. The
increase in 1998 is due to the EMD and TUJA acquisitions in Germany, which has a
higher corporate income tax rate.
Net income increased $2.3 million, or 116%, to $4.4 million, or 3.2% of
revenues, in the third quarter of 1998 from net income of $2.0 million, or 2.8%
of revenues, in the third quarter of 1997.
Operating Results - Nine Months Ended September 30, 1998 and 1997
Revenues increased $122.6 million, or 62%, to $319.2 million for the nine months
ended September 30, 1998 from $196.6 million in the comparable period of 1997.
Of this increase, approximately $85.5 million was attributable to the
acquisitions owned less than one year. The remaining increase was a result of
providing additional services to existing clients, entering into contracts to
provide services to new clients and rate increases on existing contracts.
Cost of services increased $84.1 million, or 57%, to $230.1 million for the nine
months ended September 30, 1998 from $146.0 million in 1997. As a percentage of
revenues, cost of services decreased to 72.1% for the nine months ended
September 30, 1998 from 74.3% in 1997. This decrease was primarily due to the
effect of the growth in revenues of the Company's higher margin marketing
execution and fulfillment services and operational support services businesses.
Field operating expenses increased $26.9 million, or 84%, to $59.1 million for
the nine months ended September 30, 1998 from $32.1 million in 1997. As a
percentage of revenues, field operating expenses increased to 18.5% for the nine
months ended September 30, 1998 from 16.4% in 1997. This percentage increase was
primarily attributable to the facility expenses of Gage, the Company's newly
acquired marketing execution and fulfillment services business, and the
amortization of acquisition related goodwill in 1998.
Corporate general and administrative expenses increased $2.8 million, or 25%, to
$13.9 million for the nine months ended September 30, 1998 from $11.1 million in
1997. As a percentage of revenues, these expenses decreased to 4.4% for the nine
months ended September 30, 1998 from 5.7% in 1997. This percentage decrease was
primarily due to better leveraging of corporate personnel.
7
<PAGE> 10
Operating income increased $8.9 million, or 122%, to $16.1 million for the nine
months ended September 30, 1998 from $7.3 million in 1997. As a percentage of
revenues, operating income improved to 5.1% for the nine months ended September
30, 1998 from 3.7% in 1997.
Interest expense, net, increased $691,000, or 69%, to $1.7 million for the nine
months ended September 30, 1998 from $1.0 million in 1997. Interest expense
increased in 1998 due to the use of the Company's credit facility to fund
acquisitions made in 1998.
Income tax provision increased $3.4 million, or 131%, to $6.0 million for the
nine months ended September 30, 1998 from $2.6 million in 1997. The Company
provided income taxes at a rate of 40.5% in 1998 and 38.5% in 1997. The increase
in 1998 is due to the EMD and TUJA acquisitions in Germany, which has a higher
corporate income tax rate.
The Company expensed extraordinary items associated with the Company's IPO
during the second quarter of 1997 of $385,000, net of taxes of $257,000. The
extraordinary items consisted of the write-off of unamortized loan origination
costs and debt discount.
Net income increased $5.0 million, or 134%, to $8.8 million, or 2.7% of
revenues, for the nine months ended September 30, 1998 from net income of $3.7
million, or 1.9% of revenues, in 1997.
Liquidity and Capital Resources
Cash used in operating activities was $5.5 million for the nine months ended
September 30, 1998 compared to cash provided by operating activities of $1.8
million for the nine months ended September 30, 1997. This decrease in cash from
operating activities was primarily the result of an increase of $6.6 million in
net income before depreciation and amortization offset by $13.3 million of
changes in working capital due to increases in accounts receivable as a result
of the Company's acquisitions, the growth in revenues and the timing of payments
of accounts payable and accrued expenses. Cash used in investing activities for
the nine months ended September 30, 1998 was $131.0 million compared to $12.3
million for the nine months ended September 30, 1997. The increased use of cash
was principally as a result of the acquisitions made in 1998, which were larger
than the acquisitions in 1997, and additional purchases of transportation and
computer equipment. Cash provided by financing activities for the nine months
ended September 30, 1998 was $132.3 million compared to $10.8 million for the
nine months ended September 30, 1997. The increase in cash provided by financing
activities for 1998 was principally the result of additional borrowings under
the Company's credit facility in 1998 to fund the acquisitions.
Capital expenditures were approximately $7.6 million for the nine months ended
September 30, 1998 compared to $1.9 million for the nine months ended September
30, 1997. Historically, capital expenditures have been, and future expenditures
are anticipated to be, primarily to support expansion of the Company's
operations, including transportation equipment and management information
systems.
Effective July 9, 1998, the Company expanded its credit facility to $150 million
with a syndicate of banks led by First Union National Bank. The Company plans to
utilize the facility to grow its business through strategic acquisitions. At
September 30, 1998, there was approximately $17 million of availability
remaining under the credit facility.
8
<PAGE> 11
The Company believes that funds generated from operations, together with
existing cash and borrowings under the credit facility, will be sufficient to
finance its current operations, planned capital expenditures and internal growth
for at least the next several years. If the Company were to make a significant
acquisition for cash it may be necessary for the Company to obtain additional
debt or equity financing.
Year 2000 Issues
The Company is currently in the process of addressing the Year 2000 issue, which
is the result of computer programs being written using two digits rather than
four to define the applicable year. The Company has determined that it will be
required to modify or replace portions of its software so that its computer
systems will function properly with respect to dates in the year 2000 and
thereafter. This modification and replacement process will be implemented by the
Company's Management Information Systems employees with assistance from outside
consultants. The Company presently believes that, with planned modifications to
existing software and conversions to new software, the Year 2000 issue will not
pose significant operations problems for its computer systems.
The Company is communicating with its significant vendors and customers to
determine the progress that those vendors and customers are making in
remediating their own Year 2000 issues. The Company is requiring that
significant vendors and customers certify those products and services to be
Year 2000 compliant.
The Company has developed an implementation plan to resolve the Year 2000 issue.
This plan includes assessment, modification and testing of identified systems.
Preliminary estimates for these one time Year 2000 project costs are in the
range of $1 to $2 million. The Company expects the majority of these capital
expenditures to be incurred in 1999. The Company's Year 2000 project costs are
not expected to have a material impact on its liquidity or capital resources.
Forward-Looking Statements
Certain statements contained in this report may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Such forward-looking statements involve estimates, assumptions and
uncertainties, and accordingly, actual results could differ materially from
those expressed in the forward-looking statements. Such uncertainties include,
among others, the factors referred to in the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1997.
9
<PAGE> 12
AHL SERVICES, INC.
PART II - OTHER INFORMATION AND SIGNATURE
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits:
<TABLE>
<CAPTION>
Exhibit Number Description
-------------- -----------
<S> <C>
11 Computation of Earnings Per Share
27 Financial Data Schedule (For SEC Filing Purposes Only)
</TABLE>
(b) Reports on Form 8-K:
During the third quarter of 1998, the Company filed a Form 8-K
and a Form 8-K/A, dated July 24, 1998, for the Gage
acquisition and a Form 8-K and a Form 8-K/A dated July 31,
1998, for the EMD acquisition.
10
<PAGE> 13
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, thereunto duly authorized.
AHL SERVICES, INC.
(REGISTRANT)
Date: November 13, 1998 By: /s/ David L. Gamsey
------------------------------------------
David L. Gamsey
Vice President and Chief Financial Officer
(On behalf of the Registrant and as Chief
Accounting Officer)
11
<PAGE> 1
EXHIBIT 11
AHL SERVICES, INC.
COMPUTATION OF EARNINGS PER SHARE
(IN THOUSANDS, EXCEPT PER-SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------- --------------------------
1998 1997 1998 1997
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Income Applicable to Common Stock
- ---------------------------------
Income before extraordinary items $ 4,368 $ 2,020 $ 8,758 $ 4,125
Extraordinary items, net of taxes -- -- -- (385)
---------- ---------- ---------- ----------
Net income $ 4,368 $ 2,020 $ 8,758 $ 3,740
========== ========== ========== ==========
Weighted Average Shares
- -----------------------
Common shares 13,958 10,853 13,726 10,075
Common share equivalents applicable to
stock options and warrants outstanding 621 335 578 256
---------- ---------- ---------- ----------
Weighted average common and common
equivalent shares outstanding during
the period 14,579 11,188 14,304 10,331
========== ========== ========== ==========
Per Share Amount
Income before extraordinary items
Basic $ 0.31 $ 0.19 $ 0.64 $ 0.41
========== ========== ========== ==========
Diluted $ 0.30 $ 0.18 $ 0.61 $ 0.40
========== ========== ========== ==========
Extraordinary items, net of taxes
Basic $ -- $ -- $ -- $ (0.04)
========== ========== ========== ==========
Diluted $ -- $ -- $ -- $ (0.04)
========== ========== ========== ==========
Net income
Basic $ 0.31 $ 0.19 $ 0.64 $ 0.37
========== ========== ========== ==========
Diluted $ 0.30 $ 0.18 $ 0.61 $ 0.36
========== ========== ========== ==========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM AHL
SERVICES, INC. CONDENSED CONSOLIDATED BALANCE SHEET AT SEPTEMBER 30, 1998 AND
THE CONDENSED CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 11,325
<SECURITIES> 0
<RECEIVABLES> 113,138
<ALLOWANCES> 945
<INVENTORY> 2,308
<CURRENT-ASSETS> 138,918
<PP&E> 33,279
<DEPRECIATION> 11,397
<TOTAL-ASSETS> 329,240
<CURRENT-LIABILITIES> 80,583
<BONDS> 133,027
0
0
<COMMON> 141
<OTHER-SE> 100,657
<TOTAL-LIABILITY-AND-EQUITY> 329,240
<SALES> 319,184
<TOTAL-REVENUES> 319,184
<CGS> 230,102
<TOTAL-COSTS> 230,102
<OTHER-EXPENSES> 72,959
<LOSS-PROVISION> 200
<INTEREST-EXPENSE> 1,686
<INCOME-PRETAX> 14,729
<INCOME-TAX> 5,971
<INCOME-CONTINUING> 8,758
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,758
<EPS-PRIMARY> 0.64
<EPS-DILUTED> 0.61
</TABLE>
