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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) April 30, 1998
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National TechTeam, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-16284 38-2774613
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.
835 Mason Street, Suite 200 Dearborn, MI 48224
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(Address of principal executive offices) (City, State) (Zip Code)
Registrant's telephone number, including area code (313) 277-2277
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(Former name of former address, if changed since last report.)
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ITEM 5. OTHER EVENTS.
On April 30, 1998, the Company issued the press release attached as Exhibit 2.1
to this Form 8-K.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
2.1 Press release dated April 30, 1998 "NATIONAL TECHTEAM, INC. ANNOUNCES
REVENUES AND EARNINGS FOR THE FIRST QUARTER 1998"
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.
NATIONAL TECHTEAM, INC.
Dated: April 30, 1998 By: /s/ Lawrence A. Mills
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Lawrence A. Mills,
Senior Vice President, CFO,
Secretary and Treasurer
2
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
2.1 News Release
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EXHIBIT 2.1
NEWS RELEASE
FOR IMMEDIATE RELEASE-- APRIL 30, 1998 International Provider of
- -------------------------------------- Computer Services
National TechTeam, Inc.
835 Mason Street, Suite 200
Dearborn, Michigan 48124 NASDAQ/NM - "TEAM"
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CONTACT:
NATIONAL TECHTEAM, INC. NATIONAL TECHTEAM, INC.
William F. Coyro, Jr. Lawrence A. Mills
Chief Executive Officer Chief Financial Officer
(313) 277-2277 (313) 277-2277
NATIONAL TECHTEAM, INC. ANNOUNCES REVENUES
AND EARNINGS FOR THE FIRST QUARTER 1998
DEARBORN, MICHIGAN, April 30, 1998...NATIONAL TECHTEAM INC., Nasdaq symbol
("TEAM"), today reported revenues and earnings for the first quarter 1998. For
the quarter ended March 31, 1998, revenues were $26,457,087, a 42.4% increase
over the $18,576,592 reported for the first quarter of 1997 and the highest
revenues ever reported in the Company's history. Net income for the quarter was
$141,059, or $0.01 per share, compared with a loss of $364,353, or $(0.02) per
share, for the corresponding quarter in 1997.
The strong growth in revenues reflected the increasing demand for all of
National TechTeam's computer services. Call Center Services revenues increased
35.7% to $12,311,512 from $9,074,422 in the first quarter 1997. The Corporate
Computer Services line also contributed significantly to overall results for the
quarter. Revenues increased 26.7% to $12,036,429 in the first quarter of 1998
from $9,502,170 in the first quarter of 1997.
Additionally, as a result of the acquisition of Capricorn Capital Group, Inc. in
January 1998, TechTeam reported revenues from Leasing and Related Services of
$2,109,146 in the first quarter of 1998.
On March 31, 1998 TechTeam sold its OEM call center business, consisting of its
contracts with Hewlett Packard Corporation and its contract with 3Com
Corporation, to General Electric Company for $1.4 million. General Electric then
contributed those contracts to the GE TechTeam joint venture for an agreed value
of $1.4 million and an agreement that GE shall receive all of the joint
venture's earnings until GE has recovered the $1.4 million. First quarter 1998
earnings reflect no amounts related to this sale. TechTeam will recognize the
earnings related to this sale as the joint venture records those earnings. The
Company believes that the sale of the OEM call center business is consistent
with TechTeam's strategic direction to concentrate on corporate help desk
solutions. This sale is not expected to result in a significant reduction of
present revenues from Call Center Services due to revenues from new contracts
recently received by TechTeam. It also allows TechTeam to participate in the
consumer and OEM call center business through its joint venture with GE (GE
TechTeam, L.P.)
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The foregoing contains forward-looking statements. The matters expressed in such
statements are subject to numerous uncertainties and risks including but not
limited to general economic conditions in the markets in which TechTeam
operates, fluctuation in demand for computer related services and products, the
success of actions taken to integrate Capricorn and TechTeam's business and
current expectations of TechTeam or its management. Should one or more of those
uncertainties or risks materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described as
forward-looking statements. TechTeam does not intend to update those
forward-looking statements.
NATIONAL TECHTEAM, INC. is a leading provider of information technology
outsourcing support services to large national and multi-national corporations,
government agencies and service organizations. The Company offers its services
through three global units: (i) CALL CENTER SERVICES, which provides its clients
with inbound telephone support for their computer product and end-users; (ii)
CORPORATE COMPUTER SERVICES, which provides corporations with technical staffing
(principally on-site help desk support), systems integration, and instructor-led
and computer-based training; and (iii) LEASING AND RELATED SERVICES, which
consists primarily of leasing computer-related hardware to corporate customers.
National TechTeam is traded under the symbol "TEAM".
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NATIONAL TECHTEAM, INC.
FIRST QUARTER RESULTS OF OPERATIONS
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Quarter Ended March 31 1998 1997
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Revenues $26,457,087 $18,576,592
Income/(Loss) Before Tax Provisions 444,459 (330,863)
Tax Provisions 303,400 33,500
Net Income/(Loss) 141,059 (364,353)
Basic and Diluted Earnings / (Loss)
Per Share 0.01 (0.02)
Weighted Average Number of Common
Shares and Common Share
Equivalents Outstanding
Basic 15,423,402 15,557,821
Diluted 15,635,680 15,907,240
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PRESS RELEASE ADDENDUM
National TechTeam, Inc.
Supplementary Data for Quarterly Press Release
First Quarter 1998
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FIRST QUARTER
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1998
Over/(Under)
1998 1997 1997
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Revenues
Call Center Services $12,311,512 $9,074,422 $ 3,237,090
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Corporate Computer Services
Technical staffing 6,626,107 5,686,186 939,921
Systems integration 2,983,555 2,372,788 610,767
Training programs 2,426,767 1,443,196 983,571
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12,036,429 9,502,170 2,534,259
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Leasing and related activities 2,109,146 -- 2,109,146
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Total revenues $26,457,087 $18,576,592 $ 7,880,495
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Gross profit
Amount $3,913,093 $2,535,308 1,377,785
Percentage 14.8% 13.6% 1.1%
S, G and A
Amount $3,746,649 $3,574,769 171,880
Percentage 14.2% 19.2% (5.1)%
Interest income
Amount $ (614,087) $ (723,598) $109,511
Percentage (2.3)% (3.9)% 1.6%
Income before tax provisions
Amount $444,459 $ (330,863) $775,322
Percentage 1.7% (1.8)% 3.5%
Tax provisions
Amount $303,400 $33,500 $269,900
Effective tax rate
Federal 34.6% 23.9% 10.7%
Other 51.5% (44.7)% 96.2%
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Total 68.3% (10.1)% 78.4%
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FIRST QUARTER (continued)
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Weighted average shares outstanding
Basic 15,423,402 15,557,821 (134,419)
Diluted 15,635,680 15,907,240 (271,560)
Call Center Services
Call centers 6 5 1
Equipped workstations 1,206 653 553
Calls answered 1,366,053 1,007,147 358,906
Percentage of Business by Major Customers
GE TechTeam L.P. 18.3% 0.0% 18.3%
Chrysler 18.0% 11.5% 6.5%
Ford 14.2% 20.2% (6.0%)
Hewlett Packard 13.4% 27.4% (14.1%)
UPS 5.9% 7.2% (1.2%)
Number of Employees
Call Center Services 1,232 857 375
Corporate Computer Services
Technical staffing 404 283 121
Systems integration 138 115 23
Training programs 125 96 29
Leasing and related activities 7 - 7
Sales, General, & Admin. 136 115 21
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Total employees 2,042 1,466 576
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