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Previous: GENENTECH INC, 4, 1997-03-06 |
Next: TEAM INC, 10-Q/A, 1997-03-06 |
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
AMENDMENT NO. 1
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended AUGUST 31, 1996
-------------------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period to
--------------------------- -----------------------
Commission file number 0-9950
---------------------------------------------------------
TEAM, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Texas 74-1765729
------------------------------------- ----------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation Identification Number)
or organization)
1019 South Hood Street, Alvin, Texas 77511
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (713) 331-6154
-----------------------------
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
----- -----
On October 1, 1996, there were 5,159,842 shares of the Registrant's common
stock outstanding.
<PAGE> 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The Consolidated Statements of Cash Flows set forth in Item 1
have been amended to report separate disclosures of cash flows
pertaining to the operating and financing activities of
discontinued operations.
2
<PAGE> 3
ITEM 1. FINANCIAL STATEMENTS
TEAM, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
ASSETS
August 31, May 31,
1996 1996
(Restated)
------------ ------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 1,288,000 $ 2,037,000
Accounts receivable, net of allowance for doubtful
accounts of $162,000 and $171,000 7,566,000 8,140,000
Materials and supplies 5,834,000 5,748,000
Prepaid expenses and other current assets 834,000 846,000
------------ ------------
Total Current Assets 15,522,000 16,771,000
Net Assets of Discontinued Operations, Net of Reserve
for Future Losses of $461,000 and $0 2,954,000 3,503,000
Property, Plant and Equipment:
Land and buildings 6,594,000 6,874,000
Machinery and equipment 11,149,000 11,088,000
------------ ------------
17,743,000 17,962,000
Less accumulated depreciation and amortization 11,874,000 12,197,000
------------ ------------
5,869,000 5,765,000
Other Assets 2,829,000 2,887,000
------------ ------------
$ 27,174,000 $ 28,926,000
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt $ 1,733,000 $ 1,735,000
Accounts payable 706,000 846,000
Other accrued liabilities 2,868,000 3,546,000
Current income taxes payable 14,000 --
------------ ------------
Total Current Liabilities 5,321,000 6,127,000
Long-term Debt and Other Obligations 10,797,000 11,754,000
Stockholders' Equity:
Preferred stock, cumulative, par value $100 per share,
500,000 shares authorized, none issued -- --
Common stock, par value $.30 per share, 10,000,000
shares authorized and 5,169,542 shares issued 1,551,000 1,551,000
Additional paid-in capital 24,992,000 24,992,000
Accumulated deficit (15,390,000) (15,401,000)
Treasury stock at cost, 9,700 shares (97,000) (97,000)
------------ ------------
11,056,000 11,045,000
------------ ------------
$ 27,174,000 $ 28,926,000
============ ============
</TABLE>
See notes to consolidated financial statements 3
<PAGE> 4
TEAM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
<TABLE>
<CAPTION>
Three Months Ended
August 31,
--------------------------------
1996 1995
(Restated)
------------ ------------
<S> <C> <C>
Revenues $ 10,155,000 $ 12,117,000
Operating expenses 5,716,000 6,590,000
Selling, general and administrative expenses 4,170,000 4,840,000
Interest 245,000 325,000
------------ ------------
Earnings from continuing operations before
income taxes 24,000 362,000
Provision for income taxes 14,000 203,000
------------ ------------
Earnings from continuing operations, net of
income taxes 10,000 159,000
Earnings (loss) from Military Housing projects
discontinued operations, net 182,000 (126,000)
Estimated loss on sale of Military Housing projects
discontinued operations, net (181,000) --
------------ ------------
Net earnings $ 11,000 $ 33,000
Net earnings (loss) per common share
Net earnings from continuing operations $ 0.00 $ 0.03
Net earnings (loss) from Military Housing projects
discontinued operations 0.04 (0.02)
Net estimated loss on sale of Military Housing
projects discontinued operations (0.04) 0.00
------------ ------------
Net earnings $ 0.00 $ 0.01
============ ============
Weighted average number of shares outstanding 5,160,000 5,160,000
============ ============
</TABLE>
See notes to consolidated financial statements 4
<PAGE> 5
TEAM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended
---------------------------------------
August 31, August 31,
1996 1995
(Restated)
------------------ -----------------
Cash Flows From Operating Activities:
<S> <C> <C>
Net earnings $ 11,000 $ 33,000
(Earnings) loss from discontinued operations (1,000) 126,000
----------- -----------
Net earnings from continuing operations 10,000 159,000
Adjustments to reconcile net earnings
to net cash provided by operating activities:
Depreciation and amortization 374,000 547,000
(Gain) loss on sale of assets (21,000) 3,000
Change in assets and liabilities:
(Increase) decrease:
Accounts receivable 574,000 (744,000)
Materials and supplies (86,000) 179,000
Prepaid expenses and other assets 12,000 509,000
Increase (decrease):
Accounts payable (140,000) (142,000)
Other accrued liabilities (678,000) 244,000
Income taxes payable 14,000 126,000
----------- -----------
Net cash provided by continuing operating activities 59,000 881,000
----------- -----------
Cash Flows From Discontinued Operations:
Earnings (loss) from discontinued operations 1,000 (126,000)
Depreciation 365,000 364,000
Decrease in current assets 1,154,000 1,069,000
Decrease in current liabilities (461,000) (1,018,000)
----------- -----------
Net cash provided by discontinued operations 1,059,000 289,000
----------- -----------
Net cash provided by operating activities 1,118,000 1,170,000
----------- -----------
Cash Flows from Investing Activities:
Capital expenditures (575,000) (145,000)
Disposal of property and equipment 176,000 4,000
Decrease (increase) in other assets 1,000 (121,000)
----------- -----------
Net cash used in investing activities (398,000) (262,000)
----------- -----------
Cash Flows From Financing Activities:
Payments under debt agreements
and capital lease obligations - continuing (959,000) (1,283,000)
Payments under debt agreements - discontinued (510,000) (469,000)
----------- -----------
Net cash used in financing activities (1,469,000) (1,752,000)
----------- -----------
Net decrease in cash and cash equivalents (749,000) (844,000)
Cash and cash equivalents at beginning of year 2,037,000 3,139,000
----------- -----------
Cash and cash equivalents at end of period $ 1,288,000 $ 2,295,000
=========== ===========
Supplemental disclosure of cash flow information:
Cash paid during the period for interest:
Operating $ 250,000 $ 292,000
Discontinued 1,648,000 1,688,000
----------- -----------
$ 1,898,000 $ 1,980,000
=========== ===========
Income taxes paid $ 7,000 $ 13,000
=========== ===========
</TABLE>
See notes to consolidated financial statements 5
<PAGE> 6
TEAM, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Method of Presentation
General
The interim financial statements are unaudited, but in the opinion of
management, reflect all adjustments, consisting only of normal recurring
adjustments, necessary for a fair presentation of results for such
periods. The results of operations for any interim period are not
necessarily indicative of results for the full year. These financial
statements should be read in conjunction with the financial statements and
notes thereto contained in the Company's annual report for the fiscal year
ended May 31, 1996.
The prior period financial statements have been restated to reflect the
Military Housing projects segment as discontinued operations.
2. Dividends
No dividends were paid during the first three months of fiscal 1997 or
1996. Pursuant to the Company's Credit Agreement, the Company may not pay
quarterly dividends without the consent of its senior lender. Future
dividend payments will depend upon the Company's financial condition and
other relevant matters.
3. Discontinued Operation - Military Housing Projects
The Company has entered into an Agreement of Purchase and Sale with
respect to the sale of the Company's 801 Military Housing projects. The
closing of the sale is subject to certain conditions but is anticipated to
occur no later than December 5, 1996. A summary of the discontinued
Military Housing projects' assets and liabilities as of August 31, 1996
and May 31, 1996 follows:
<TABLE>
<CAPTION>
August 31, May 31,
1996 1996
----------- -----------
Assets:
<S> <C> <C>
Current assets $ 1,730,000 $ 2,890,000
Land and buildings, net 40,758,000 41,123,000
----------- -----------
$42,488,000 $44,013,000
Liabilities:
Current liabilities $ 818,000 $ 1,745,000
Long-term debt 38,255,000 38,765,000
----------- -----------
$39,073,000 $40,510,000
----------- -----------
Net Assets $ 3,415,000 $ 3,503,000
=========== ===========
</TABLE>
6
<PAGE> 7
A summary of the results of the discontinued Military Housing projects'
operations for the period ended August 31, 1996 and 1995 follows:
<TABLE>
<CAPTION>
Three Months Ended
August 31,
-------------------------------------
1996 1995
--------------- ---------------
<S> <C> <C>
Revenues $ 1,263,000 $ 1,257,000
Operating expenses.............................. (561,000) (556,000)
General and administrative expenses............. (20,000) (90,000)
Interest expense................................ (818,000) (839,000)
Estimated future losses......................... (180,000) --
Other income.................................... 592,000 37,000
--------------- ---------------
Earnings (loss) before income taxes............. 276,000 (191,000)
(Provision) benefit for income taxes............ (94,000) 65,000
--------------- ---------------
Net earnings.................................... $ 182,000 $ (126,000)
=============== ===============
</TABLE>
During the quarter, $180,000 was accrued for estimated future losses of
the Military Housing projects' operations through the expected date of
disposition. In addition, $281,000 was accrued for the estimated loss on the
sale of the projects.
Also, as previously reported, during the quarter Team received $559,000
from the Armed Services Board of Contract Appeals in settlement of the Ft.
Stewart claim for costs and expenses associated with the termination of the
Agreement with the United States Army Corps of Engineers to construct a Federal
housing project.
7
<PAGE> 8
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 thereto duly authorized.
TEAM, INC.
(Registrant)
Date: March 6, 1997
/s/WILLIAM A. RYAN
--------------------------------------
William A. Ryan, Chairman of the Board,
President and Chief Executive Officer
/s/MARGIE E. ROGERS
-----------------------------------
Margie E. Rogers, Vice President
and Treasurer
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