<PAGE> 1
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 21, 1999
PC SERVICE SOURCE, INC.
(Exact Name of Registrant as Specified in Charter)
DELAWARE 0-23686 52-1703687
(State or other jurisdiction of (Commission File Number) (I.R.S. employer
incorporation or organization) identification no.)
2350 VALLEY VIEW LANE, DALLAS, TEXAS 75234
(Address of principal executive offices) (Zip Code)
(972) 481-4000
(Registrant's Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
<PAGE> 2
ITEM 5. OTHER EVENTS.
On April 21, 1999, PC Service Source, Inc., a Delaware corporation
(the "Company"), issued a press release announcing its adoption of a stock
repurchase program enabling the Company to repurchase up to 600,000 shares of
the Company's outstanding common stock in the open market or privately
negotiated transactions.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
99.1 -- Press Release, dated April 21, 1999, announcing
first quarter results and the adoption of the stock
repurchase program.*
- --------------------
* Filed herewith.
2
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
PC Service Source, Inc. has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date: April 26, 1999 PC SERVICE SOURCE, INC.
By: /s/ Robert J. Boutin
-----------------------------------------
Robert J. Boutin, Chief Financial Officer
3
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
- ------ -------
<S> <C>
99.1 -- Press Release, dated April 21, 1999, announcing first quarter
results and the adoption of the stock repurchase program.*
</TABLE>
- --------------------
* Filed herewith.
<PAGE> 1
EXHIBIT 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
APRIL 21, 1999
CONTACT: ROBERT J. BOUTIN
SR. VP & CHIEF FINANCIAL OFFICER
PC SERVICESOURCE
972.481.4000
PC SERVICESOURCE REPORTS THIRD QUARTER RESULTS
AND ANNOUNCES STOCK REPURCHASE PROGRAM
Dallas, TX., April 21, 1999 - PC ServiceSource (NASDAQ-PCSS) today
reported results for the first quarter ended March 31, 1999 and also announced
that its Board of Directors has authorized a stock repurchase program enabling
the company to buy up to 600,000 shares of common stock.
Net revenues increased 5 percent to $40,420,000 compared with
$38,497,000 for the same period in 1998. The company reported net earnings of
$1,112,000, or $0.19 per share, compared to net earnings of $168,000, or $0.03
per share, for the first quarter of 1998. The first quarter 1999 does not
include a provision for income taxes due to the utilization of net operating
loss carry forwards.
Avery More, Chairman and CEO of PC ServiceSource, stated "The first
quarter results are the first positive signs of our turnaround. Having made
significant progress in a short time, we will continue to work on improving our
margins and reducing our cost of doing business." Mr. More continued, "While we
understand that some investors may need more time to become bullish on PCSS
stock, we can do so now. The stock repurchase announcement is a strong
indication of our confidence in PCSS' future."
The company currently has 5,773,820 shares of common stock
outstanding. Purchases of common stock by the company may be made in the open
market or through privately negotiated transactions at prevailing market prices
depending on market conditions. The repurchased stock will become treasury
shares, available for general corporate purposes.
<PAGE> 2
PC ServiceSource defines Service Logistics outsourcing as the
following business processes: Freight Logistics, Distribution Logistics,
Exchange Logistics, Parts Lifecycle Management, Inventory Risk Management,
Parts Order Logistics, Parts Sourcing Logistics, Warranty Information
Logistics, Repair Logistics, Same-Day Turnaround Notebook Repair, and Component
Repair Services. PC ServiceSource provides Service Logistics outsourcing and
support for more than 30 major computer manufacturers and over 20,000 service
providers, and is widely recognized as the largest supplier of Service
Logistics to the PC industry. PC ServiceSource has implemented many industry
innovations, including the PC Warranty Information Network (PC WIN), the PC
industry's only real-time, Internet-based system for multiple vendor warranty
transaction processing and service parts ordering in a single, standardized
format. General and financial data is located on the Internet at
www.pcservice.com.
- -------------------------------------------------------------------------------
Caution Regarding Forward-Looking Statements: The Company occasionally makes
forward-looking statements concerning its plans, goals, product and service
offerings, and anticipated financial performance. These forward-looking
statements may generally be identified by introductions such as "outlook" for
an upcoming period of time, or words and phrases such as "should", "expect",
"hope", "plans", "projected", "believes", "forward-looking" (or variants of
those words and phrases) or similar language indicating the expression of an
opinion or view concerning the future. These forward-looking statements are
subject to risks and uncertainties based on a number of factors and actual
results or events may differ materially from those anticipated by such
forward-looking statements. These factors include, but are not limited to,
those described under the heading "Caution Regarding Forward-Looking
Statements" in the Company's Report on Form 10K for 1998 as it may be updated
in any subsequent Report on Form 10Q, all as filed with the Securities and
Exchange Commission. The Company does not plan to generally publicly update
prior forward-looking statements for unanticipated events or otherwise and,
accordingly, prior forward-looking statements should not be considered to be
"fresh" simply because the Company has not made additional comments on those
forward-looking statements.
<PAGE> 3
PC SERVICE SOURCE, INC.
COMPARATIVE FINANCIAL DATA
(In thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
March 31,
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Net revenues $ 40,420 $ 38,497
Gross margin 10,172 9,831
Operating expenses:
Selling, general and administrative 7,423 8,215
Depreciation and amortization 1,207 1,030
---------- ----------
Total operating expenses 8,630 9,245
---------- ----------
Earnings from operations 1,542 586
Net interest expense 430 319
---------- ----------
Earnings before income taxes 1,112 267
Net earnings $ 1,112 $ 168
========== ==========
Earnings per share
Basic $ .19 $ .03
Diluted $ .19 $ .03
Weighted average common shares outstanding
Basic 5,774 5,758
Diluted 5,810 5,869
</TABLE>
Note: Certain previously reported financial information has been reclassified
to conform with the 1999 presentation.
<PAGE> 4
PC SERVICE SOURCE, INC.
BALANCE SHEET
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
MARCH 31, 1999 DECEMBER 31, 1998
--------------- -----------------
<S> <C> <C>
Assets
Cash $ 1,099 $ 940
Accounts receivable, net 20,132 19,212
Inventories 22,438 22,031
Other current assets 2,780 2,824
Property and equipment, net 14,176 15,081
Other assets, net 2,575 2,646
--------------- ---------------
Total Assets $ 63,200 $ 62,734
=============== ===============
Liabilities and Equity
Accounts payable $ 14,400 $ 14,058
Accrued liabilities 8,859 9,129
Current debt 1,380 1,399
Revolving line of credit 13,851 14,229
Long-term debt 2,356 2,677
Other liabilities 1,102 1,102
Shareholders' equity 21,252 20,140
--------------- ---------------
Total Liabilities & Equity $ 63,200 $ 62,734
=============== ===============
</TABLE>
###