UNITED STATES
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 27, 2004
--------------
CENTURY BUSINESS SERVICES, INC.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
Delaware 22-2769024
- ------------------------------- ------------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
0-25890
------------------------
(Commission File Number)
6050 Oak Tree Boulevard South, Suite 500
Cleveland, Ohio 44131
(Address of Principal Executive Offices)
(Zip Code)
Registrant's Telephone Number, Including Area Code 216-447-9000
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
Item 7(c). Exhibits
Exhibit 99.1 Press Release of Century Business Services, Inc. dated April 27,
2004, announcing its financial results for the first quarter
ended March 31, 2004.
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On April 27, 2004, Century Business Services, Inc. (CBIZ) announced its earnings
for the first quarter ended March 31, 2004. A copy of the press release is filed
herewith as Exhibit 99.1. In addition, on April 27, 2004, Century conducted its
earnings conference call for the quarter ended March 31, 2004. On this
conference call, CBIZ disclosed the following additional information:
- Goals for revenue growth in the 4% to 6% range, EPS growth in the 25%
to 30% range and EBITDA of approximately $50 million for fiscal year
2004 are unchanged and are believed to be attainable. Revenue growth
in the Benefits and Insurance segment is expected to be in the
mid-single digits in 2004 over 2003. Our goal for acquisitions
completed during 2004 is to generate revenue growth of at least 3%
over our existing revenue base.
- The full year 2004 cross-serving goal is $9 million in first year
revenue. Year to date, CBIZ has generated approximately $3.5 million
of first year revenue, and we expect to meet or exceed the goal.
- CBIZ divested Health Administration Services (a benefits and insurance
operation), during the second quarter of 2003, which generated $3.2
million and $2.2 million of revenue during the first and second
quarters of 2003, respectively. The operation was marginally
profitable with a margin of less than 10%, and contributed $0.5 to
$0.6 million of pretax income for the year ended December 31, 2003.
- Approximately $1.5 million of the favorable variance in gross margin
from March 31, 2003 to March 31, 2004 in the National Practices -
Other segment, was the direct result of a mergers and acquisitions
transaction.
- Net of $33 million that was drawn on the credit facility to fund the
share repurchase that occurred during the third quarter of 2003, the
cash flow used to pay down bank debt was approximately $27 million
during the twelve months ended March 31, 2004.
- The credit facility was utilized to fund the $37.5 million share
repurchase that occurred during the first week in April 2004. As a
result, borrowings under the facility peaked at approximately $60
million when the share repurchase was completed, and have been reduced
to $54 million as of April 27, 2004. CBIZ expects to continue reducing
the balance on the credit facility throughout 2004 as we continue to
generate strong cash flow.
- Cash spent on capital expenditures during the three months ended March
31, 2004, was approximately $2 million. Capital expenditures are
expected to be $8 million to $10 million for the twelve months ended
December 31, 2004.
- Bad debt expense for the quarter ended March 31, 2004 was $1.4
million.
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.
CENTURY BUSINESS SERVICES, INC.
Date: May 3, 2004
/s/ Ware H. Grove
---------------------------
Ware H. Grove
Chief Financial Officer