Exhibit 99.1
Team Inc. Reports First Quarter Results and Affirms Outlook for Fiscal
Year 2004
ALVIN, Texas--(BUSINESS WIRE)--Sept. 22, 2003--Team Inc.
(AMEX:TMI) today reported net income of $.17 per share (diluted basis)
for its first quarter ending Aug. 31, 2003, up from $.14 per share in
the prior year first quarter.
For the three months ended Aug. 31, 2003, the Company reported
earnings before interest and taxes (EBIT) of $2.4 million on revenues
of $24.9 million, as compared to EBIT of $2.0 million on revenues of
$22.0 million in the prior year period. Net income for the just ended
quarter was $1.4 million, or $.17 per share (diluted basis), compared
to $1.1 million, or $.14 per share, for the same quarter last year.
For the quarter, total revenues increased 13%, EBIT increased 20%,
and net income increased 18%. "Overall results for the quarter were in
line with our expectations," said Phil Hawk, the Company's Chairman
and CEO. "Unusually strong turnaround activity within the industrial
services segment more than offset weaker demand levels within the NDT
inspection service line as well as a small operating loss in the
equipment sales and rental segment," reported Hawk. "We affirm our
earlier fiscal year 2004 earnings guidance of $0.60 to $0.68 per share
on a fully diluted basis," said Phil Hawk.
First quarter revenues for the Industrial Services Business
Segment increased 17% to $22.3 million. Segment operating profit
increased 30% to $3.7 million. The Company enjoyed double digit growth
in several of its service lines - including on-stream leak repair,
hot-tapping, field machining and the new field valve repair service
line. "We are pleased to note that the quarterly revenues associated
with our new field valve repair service line exceeded $1 million in
our second full quarter of activity," said Hawk. NDT inspection
revenues were down about 15% from the prior year due to significantly
reduced pipeline projects versus the prior year. "Looking ahead, we
see continuing difficult market conditions for many of our major
customer segments over the next several months, but we remain
optimistic that our strong service capability, combined with our broad
multi-service, multi-location market presence, will enable us to
achieve our business and market share growth goals for this year and
beyond," said Hawk. "As we experienced in this most recent quarter,
our geographic and service line breadth enables the Company to offset
weak demand situations in a couple of areas with strong demand and
business performance in other business areas."
The Equipment Sales and Rental Business segment (encompassing
Climax Portable Machine Tool Company) struggled during the quarter
with lower sales and a weaker sales mix. Sales were $2.6 million, down
13% from the prior year first quarter. In addition, a greater portion
of the sales in this quarter were related to resale items not
manufactured by Climax and, typically, having lower gross margins. As
a result, the segment reported an approximate $100,000 loss for the
quarter versus a profit of about $250,000 for the year earlier
quarter. On a very positive note, Climax had excellent order bookings
for the quarter, capturing nearly $4 million in total orders during
the period. This performance was driven by the award to Climax of
several very large projects for both ship yard and power industry
applications which are scheduled to be shipped in the early second
half of FY04. "Despite our near-term difficulties, we remain
optimistic about our business prospects and overall outlook for the
year," said Hawk.
As previously announced, the Company has scheduled an earnings
conference call to discuss these results tomorrow, September 23rd, at
11 a.m. Eastern Daylight Time (10 a.m. CDT). The call will be
broadcast over the Web by C3 Conferencing and can be accessed on
Team's Web site, www.teamindustrialservices.com. Individuals wishing
to participate in the conference call by phone can call 1-888-896-0862
and ask to join the "Team IR" call.
Team Inc. provides an array of specialized industrial services
related to the construction and maintenance of pressurized piping and
process systems. Headquartered in Alvin, Texas, the Company operates
in over 40 customer service locations throughout the United States.
Team also manufactures, sells and rents portable field-machining tools
through its Climax subsidiary. Team Inc. common stock is traded on the
American Stock Exchange under the ticker symbol "TMI".
Certain forward-looking information contained herein is being
provided in accordance with the provisions of the Private Securities
Litigation Reform Act. Such information is subject to certain
assumptions and beliefs based on current information known to the
Company and is subject to factors that could result in actual results
differing materially from those anticipated in the forward-looking
statements contained herein. Such factors include domestic and
international economic activity, interest rates, and market conditions
for the Company's customers, regulatory changes and legal proceedings,
and the Company's successful implementation of its internal operating
plans. Accordingly, there can be no assurance that the forward-looking
statements contained herein will occur or that objectives will be
achieved.
For additional information, contact Philip J. Hawk or Ted W. Owen
at 281-331-6154.
TEAM INC. AND SUBSIDIARIES
SUMMARY OF OPERATING RESULTS
Three Months Ended
Aug. 31,
-------------------------
2003 2002
------------ ------------
Total Revenues $24,918,000 $22,008,000
============ ============
Gross Margin $10,112,000 $9,031,000
Selling General and Administrative Expenses $7,718,000 $6,993,000
Non-cash compensation charge $31,000 $21,000
Other Expense (Income)
------------ ------------
Earnings before interest and taxes $2,363,000 $2,017,000
============ ============
Pre-tax income $2,218,000 $1,858,000
Income tax expense (benefit) $856,000 $710,000
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Net income $1,362,000 $1,148,000
============ ============
Net income per common share-basic $0.18 $0.15
============ ============
Net income per common share-diluted $0.17 $0.14
============ ============
Weighted average shares outstanding:
Basic 7,610,000 7,703,000
Diluted 8,250,000 8,490,000
Revenues Comprised of:
Industrial Services $22,315,000 $19,032,000
Equipment sales and rentals 2,603,000 2,976,000
------------ ------------
Total Revenues $24,918,000 $22,008,000
============ ============
EBIT, by segment:
Industrial Services $3,650,000 $2,812,000
Equipment sales and rentals (95,000) 256,000
Corporate (1,192,000) (1,051,000)
------------ ------------
$2,363,000 $2,017,000
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TEAM INC. AND SUBSIDIARIES
SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION
AUG. 31 AND MAY 31, 2003
Aug. 31 May 31
2003 2003
------------ ------------
Current Assets $32,029,000 $29,417,000
Net Property, Plant and Equipment $13,005,000 $12,268,000
Other non-current assets $10,481,000 $10,539,000
------------ ------------
Total Assets $55,515,000 $52,224,000
============ ============
Current Liabilities $10,251,000 $9,704,000
Long term debt $11,186,000 $9,577,000
Other non-current liabilities and taxes $1,200,000 $1,208,000
Stockholders' equity $32,878,000 $31,735,000
------------ ------------
Total liabilities and Stockholders' Equity $55,515,000 $52,224,000
============ ============
CONTACT: Team Inc., Alvin
Ted W. Owen, 281-331-6154