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) June 25, 1998
APAC TELESERVICES, INC.
(Exact name of registrant as specified in charter)
Illinois 0-26786 36-2777140
(State or other jurisdiction (Commission (IRS Employer
of incorporation) file number) Identification No.)
One Parkway North Center, Suite 510, Deerfield, IL 60015
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code (847) 374-4980
N/A
(Former name or former address, if changed since last report)
Item 5. OTHER EVENTS
On June 25, 1998, Registrant issued a press release, a copy of which is
attached as Exhibit 99.1 to this Form 8-K and incorporated herein by reference.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
Exhibit No. Description of Document
(99.1) Press release dated June 25, 1998,
issued by the Registrant.
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.
Date: June 25, 1998 APAC TELESERVICES, INC.
By: /s/ John I. Abernethy
John I. Abernethy
Chief Financial Officer
FOR IMMEDIATE RELEASE
Investor Contact:
Thomas W. Eberhardt
847-374-1949
Media Contact:
Daniel Bauer
847-374-1943
APAC ANNOUNCES RESTRUCTURING CHARGE
FOR ITI ACQUISITION
Deerfield, Ill. (June 25, 1998) APAC TeleServices, Inc. (NASDAQ:APAC), a
premier provider of outsourced customer service and sales, today announced that
the Company will record a second quarter pre-tax restructuring charge of $9
million, or $.11 per share, related to its acquisition of ITI Marketing
Services, Inc.
As a result of reorganization efforts and current business conditions in
the teleservices industry, APAC has lowered its second quarter earnings
estimates, before the impact of the restructuring charge, to $.04 per share.
Consequently, the Company now expects to report a net loss in the second quarter
of $.07 per share. These factors have prompted management to adjust second
half earnings estimates to $.16-$.18 per share.
The restructuring charge is primarily related to transitional costs
associated with changes affecting APAC operations and infrastructure. The
charge includes costs for consolidating outbound customer contact centers and
the elimination of various other administrative costs.
In conjunction with the acquisition last month of ITI Marketing Services,
Inc., APAC designed an aggressive integration plan to increase efficiencies,
share best practices, improve capacity utilization by leveraging infrastructure,
and more closely align expenses with projected revenues. APAC's board of
directors has approved this plan for immediate implementation.
Theodore G. Schwartz, APAC's chairman and chief executive officer stated,
"APAC is focused on the successful integration of ITI and the realization of our
synergistic opportunities. We are fully committed to achieving our
profitability objectives."
APAC plans to immediately consolidate current volume by transferring
assignments from the four least efficient of its customer contact centers to
other operational centers. This shift, and subsequent closing of these four
centers, will allow for the same level of work to be supported by fewer total
workstations.
Headquartered in the Chicago suburb of Deerfield, Illinois, APAC operates
customer contact centers with more than 25,000 employees in 19 states. Founded
in 1973, APAC seeks to optimize the value of its clients' customer relationships
by improving customer service, increasing sales, leveraging technology and
managing change for corporate growth. Clients include some of the best-managed,
most highly respected corporations in America. These corporations represent a
wide range of industries including business and consumer products,
communications, delivery, energy, financial services, insurance, retail and
technology. The Company's Web site address is www.apacteleservices.com.
Paragren Technologies, Inc., APAC's wholly owned subsidiary, is
headquartered in Reston, Virginia. Paragren provides innovative marketing
solutions to drive enterprise-wide customer intelligence for organizations in
the telecommunications, financial services, energy and retail industries.
Paragren's solutions transform information in data warehouses to support
customer-centric, one-to-one marketing. The Company's core competencies include
the One-By-One(R) marketing software suite, consumer-panel market intelligence,
data warehouse consulting and database outsourcing. Additional information is
available on their Web site at www.paragren.com.
Statements contained herein regarding APAC's expected growth, prospective
business opportunities and future expansion plans are forward-looking statements
that involve substantial risks and uncertainties. In accordance with the
Private Securities Litigation Reform Act of 1995, following are important
factors that could cause actual results to differ materially from those
expressed or implied by such forward-looking statements: there can be no
assurance that APAC will be able to maintain or accelerate its growth rate,
effectively manage its rapid growth or maintain profitability. There can be no
assurance that APAC can build out facilities in a timely and economic manner.
In the future, APAC may experience excess peak period capacity when it opens a
new customer contact center or terminates or completes a large client program.
APAC's agreements with its clients generally do not ensure that APAC will
generate a specific level of net revenue, do not designate APAC as the client's
exclusive service provider, and many are terminable by the client on relatively
short notice. In addition, the amount of net revenue APAC generates from a
particular client generally is dependent upon customers' interest in, and use
of, the client's products or services. Readers are encouraged to review the
section captioned "Information Regarding Forward-Looking Statements" on Form 10-
K in APAC's Annual Report for the year ended December 28, 1997, which describes
other important factors that may affect APAC's business, results of operations
and financial condition.
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