<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):October 15, 1997
ROMAC INTERNATIONAL, INC.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 0-26058 59-3264661
------- ------- -----------
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
120 West Hyde Park Place, Suite 150, Tampa, Florida 33606
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (813)-251-1700
---------------
N/A
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
ITEM 5. OTHER EVENTS
On October 14, 1997, Romac International, Inc. announced results for the three
and nine months ended September 30, 1997. The following earnings per share
amounts do not reflect the two-for-one stock split in the form of a 100% stock
dividend to shareholders, effective October 3, 1997.
For the third quarter, net service revenues increased to $45.9 million from
$26.4 million for the same period last year. This represents an increase of
73.9%. Net income increased to $3.0 million for the third quarter of 1997 from
$1.8 million for the same period last year. This represents an increase of
66.7%. Fully-Diluted earnings per share increased to $.23 for the third quarter
of 1997 from $.14 per share for the same period last year. This represents an
increase of 64.3%. Fully-Diluted weighted average shares outstanding for the
third quarter increased by 3.9% to 13.3 million from 12.8 million for the same
period in 1996.
For the nine months ended September 30, 1997, net service revenues increased to
$120.5 million from $64.8 million for the same period last year. This represents
an increase of 86.0%. Net income increased to $7.5 million for the first nine
months of 1997 from $4.1 million for the same period last year. This represents
an increase of 82.9%. Fully-Diluted earnings per share increased to $.58 for the
first nine months of 1997 from $.36 for the same period last year. This
represents an increase of 61.1%. Fully-Diluted weighted average shares
outstanding for the first nine months of the year increased by 12.2 % to 12.9
million from 11.5 million for the same period in 1996.
Revenues. Net service revenues increased 73.9% and 86.0%, respectively,
to $45.9 million and $120.5 million for the three and nine month periods ended
September 30, 1997 as compared to $26.4 million and $64.8 million for the same
periods in 1996. These increases were comprised of a $17.9 million and $50.0
million increase in flexible billings (Professional Temporary and Contract
Services revenues combined) and a $1.5 million and $5.8 million increase in
Search Fees for the three and nine month periods ending September 30, 1997, as
described below.
Flexible billings increased 84.8% and 97.1%, respectively, to $39.0
million and $101.5 million for the three and nine month periods ended September
30 1997 as compared to $21.1 million and $51.5 million for the same periods in
1996. This increase is a result of an increase in the number of hours billed by
Company-owned operations as compared to the same periods in 1996. The average
hourly bill rate for the three and nine month periods ended September 30, 1997
increased to $36.5 and $34.5 from $29.2 and $27.5 for the three and nine month
periods ended September 30, 1996 due to the mix of contract business as a
percentage of total flexible billings. In addition, the Company's Emerging
Technologies initiative increased its bill rates 24.0% and 23.3% for the three
and nine month periods ended September 30, 1997 compared to the same periods in
1996 as the demand for these highly skilled knowledge workers continues to
build.
Search fees increased 27.8% and 43.6%, respectively, to $6.9 million
and $19.1 million for the three and nine month periods ended September 30,1997
as compared to $5.4 million and $13.3 million for the same periods in 1996. The
increase resulted primarily from an increase in the number of search sales
consultants, which increased the number of search placements made during the
three and nine month periods ended September 30, 1997 as compared to the same
periods in 1996. The average fee for each search placement made during the
periods remained relatively constant.
The Company from time to time experiences fluctuations in its monthly
revenues in its operations. For example, July results for Information Technology
Services showed no improvement over the previous month, but that segment has
since returned to historical growth rates.
Net income. Net income increased 66.7% and $82.9%, respectively, to
$3.0 million and $7.5 million for the three and nine month periods ended
September 30, 1997 as compared to approximately $1.8 million and $4.1 million
for the same periods in 1996. These increases were due to the revenue increases
discussed above offset by a decrease in gross profit as a percentage of net
service revenues due to the continuing change in the business mix towards
flexible billings which has traditionally lower gross margins and a decrease in
selling, general and administrative expenses as a percentage of net service
revenues (although selling, general and administrative expenses increased in
absolute dollars) due to economies of scale gained from a larger revenue base.
Certain of the above statements contained in this Report on Form 8-K are
forward-looking statements that involve a number of risks and uncertainties.
Such forward looking statements are within the meaning of that term in Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Act of 1934, as amended. Factors that could cause actual results to differ
materially include the following: business conditions and growth in the staffing
industry and general economy; competitive factors; risks due to shifts in market
demand; changes in service mix; ability of the Company to complete acquisitions;
and the risk factors listed from time to time in the Company's reports filed
with the Securities and Exchange Commission, as well as assumptions regarding
the foregoing. The words "believe," "estimate", "expect," "intend."
"anticipate"and similar expressions and variations thereof identify certain of
such forward-looking statements, which speak only as of the dates on which they
were made. The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events, or otherwise. Readers are cautioned that any such forward-looking
statements are not guarantees of future performance and involve risks and
uncertainties, and that actual results may differ materially from those
indicated in the forward-looking statements as a result of various factors.
Readers are cautioned not to place undue reliance on these forward-looking
statements.
<PAGE> 3
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
99.1 Press release dated October 14, 1997-Romac International, Inc.
"The KnowledgeForce Resource" Announces 64% Increase in Third Quarter
Earnings Per Share
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.
ROMAC INTERNATIONAL, INC.
(Registrant)
By:/S/ Thomas M. Calcaterra
Thomas M. Calcaterra, Chief Financial Officer and
Secretary
Date: October 14, 1997
<PAGE> 1
EXHIBIT 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
Contact: Tom Calcaterra
Chief Financial Officer
(813)-251-1700
ROMAC INTERNATIONAL, INC. "THE KNOWLEDGEFORCE RESOURCE" ANNOUNCES 64% INCREASE
IN THIRD QUARTER EARNINGS PER SHARE
TAMPA, FLORIDA (October 14, 1997) - Romac International, Inc. (Nasdaq-NHM: ROMC
- - "Romac") today announced results for its third quarter and nine months ended
September 30, 1997.
THE NUMBERS
For the third quarter, net service revenues increased to $45.9 million from
$26.4 million for the same period last year. This represents an increase of
73.9%. Net income increased to $3.0 million for the third quarter of 1997 from
$1.8 million for the same period last year. This represents an increase of
66.7%. Fully-Diluted earnings per share increased to $.23 for the third quarter
of 1997 from $.14 per share for the same period last year. This represents an
increase of 64.3%. Fully-Diluted weighted average shares outstanding for the
third quarter increased by 3.9% to 13.3 million from 12.8 million for the same
period in 1996.
For the nine months ended September 30, 1997, net service revenues increased to
$120.5 million from $64.8 million for the same period last year. This represents
an increase of 86.0%. Net income increased to $7.5 million for the first nine
months of 1997 from $4.1 million for the same period last year. This represents
an increase of 82.9%. Fully-Diluted earnings per share increased to $.58 for the
first nine months of 1997 from $.36 for the same period last year. This
represents an increase of 61.1%. Fully-Diluted weighted average shares
outstanding for the first nine months of the year increased by 12.2 % to 12.9
million from 11.5 million for the same period in 1996.
THE SERVICES
Romac International, Inc. provides people-driven outcomes to client and
candidate customers in the specialty areas of information technology, finance
and accounting, human resources, pharmaceutical, health care, manufacturing
services, life insurance, investments and banking. The Company partners
principally with Fortune 1000 companies in sixteen metropolitan markets.
<PAGE> 2
THE BUSINESS
David L. Dunkel, President and CEO of Romac International, Inc. said, "We are
very pleased with our financial performance for the third quarter of 1997.
During the quarter, on a functional basis, Information Technology, Finance and
Accounting, Human Resources and Operating Specialties all grew substantially.
Additionally, during the third quarter, we focused on the expansion of our
Executive Solutions service offering, which provides high level finance and
accounting professionals on a flexible basis. On the acquisition front, the
addition of UQ Solutions and Sequent in September 1997 to the Romac team
significantly strengthens our information technologies market presence in
Chicago and the Silicon Valley area."
"Additionally, we made several important management additions with Ron English
being named President of Romac Information Technologies and Jack Causa being
named President of Romac Finance and Accounting. Pete Alonso, formerly with
Romac Information Technologies, was promoted to President of Romac Operating
Specialties, which includes our pharmaceutical, health care, manufacturing
services, life insurance, investments and banking specialties. Finally, our
internal PeopleSoft implementation is ahead of schedule as we reported September
results from the new system only five months after selecting it."
THE OUTLOOK
Mr. Dunkel added, "We are excited about our prospects and the opportunities
before us. In closing, we would like to thank our client customers, our
KnowledgeForce and our operating and servicing personnel for their continued
exceptional efforts."
Certain of the above statements contained in this press release are
forward-looking statements that involve a number of risks and uncertainties.
Such forward looking statements are within the meaning of that term in Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Act of 1934, as amended. Factors that could cause actual results to differ
materially include the following: business conditions and growth in the staffing
industry and general economy; competitive factors; risks due to shifts in market
demand; changes in service mix; ability of the Company to complete acquisitions;
and the risk factors listed from time to time in the Company's reports filed
with the Securities and Exchange Commission, as well as assumptions regarding
the foregoing. The words "believe," "estimate", "expect," "intend."
"anticipate"and similar expressions and variations thereof identify certain of
such forward-looking statements, which speak only as of the dates on which they
were made. The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events, or otherwise. Readers are cautioned that any such forward-looking
statements are not guarantees of future performance and involve risks and
uncertainties, and that actual results may differ materially from those
indicated in the forward-looking statements as a result of various factors.
Readers are cautioned not to place undue reliance on these forward-looking
statements.
<PAGE> 3
<TABLE>
<CAPTION>
ROMAC INTERNATIONAL, INC.
STATEMENT OF SELECTED OPERATING DATA
FOR THE QUARTER ENDED FOR THE NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBERR30,31,
1997 1996 1997 1996
---- ---- ---- ----
(UNAUDITED) (UNAUDITED)
(IN THOUSANDS EXCEPT PER SHARE DATA) (IN THOUSANDS EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
NET SERVICE REVENUES:
FLEXIBLE BILLINGS $39,006 $21,063 $101,456 $51,488
SEARCH FEES 6,909 5,371 19,051 13,300
------- ------- -------- -------
NET SERVICE REVENUES $45,915 $26,434 $120,507 $64,788
======= ======= ======== =======
NET INCOME $ 3,040 $ 1,805 $ 7,546 $ 4,118
======= ======= ======== =======
EARNINGS PER SHARE - PRIMARY $ 0.23 $ 0.14 $ 0.59 $ 0.36
======= ======= ======== =======
WEIGHTED AVERAGE SHARES O/S-PRIMARY 13,164 12,712 12,835 11,411
======= ======= ======== =======
EARNINGS PER SHARE - FULLY-DILUTED $ 0.23 $ 0.14 $ 0.58 $ 0.36
======= ======= ======== =======
WEIGHTED AVERAGE SHARES O/S-FULLY-DILUTED 13,263 12,801 12,917 11,482
======= ======= ======== =======
</TABLE>
<TABLE>
<CAPTION>
FOR THE QUARTER ENDED FOR THE NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
1997 1996 1997 1996
---- ---- ---- ----
(UNAUDITED (UNAUDITED)
(IN THOUSANDS) (IN THOUSANDS)
<S> <C> <C> <C> <C>
NET SERVICE REVENUES (BY FUNCTION):
INFORMATION TECHNOLOGY $23,743 $10,709 $ 58,160 $31,612
FINANCE AND ACCOUNTING 17,363 12,480 $ 48,379 26,422
HUMAN RESOURCES 2,661 2,246 $ 8,472 4,505
OPERATING SPECIALITIES 2,148 999 $ 5,496 2,249
------- -------
NET SERVICE REVENUES (BY FUNCTION): $45,915 $26,434 $120,507 $64,788
======= ======= ======== =======
</TABLE>
