Exhibit 99.1
Team, Inc. Reports Record FY 2007 Results of $1.64 Per Share, Announces
2-for-1 Stock Split, Provides FY 2008 Earnings Guidance
ALVIN, Texas--(BUSINESS WIRE)--July 25, 2007--Team, Inc.,
(NASDAQ:TISI) today reported net income of $6.1 million ($0.63 per
diluted share) and $15.5 million ($1.64 per diluted share) for its
fourth quarter and full fiscal year ended May 31, 2007, respectively.
Net income increased 52 percent and 46 percent from the corresponding
fourth quarter and full year 2006, respectively. For the fiscal year,
total revenue was $318 million, up 23 percent, and operating income
was $30.3 million, up 42 percent.
Team also announced that the Board of Directors has approved a
two-for-one stock split in the form of a 100 percent stock dividend
payable on August 29, 2007 to all shareholders of record on August 15,
2007. This action will double the total number of common shares
outstanding to nearly 18 million shares.
"I am proud to report that fiscal year 2007 was another year of
record performance for Team. Team's decision to join the Nasdaq, our
recent acquisition of Aitec, and today's announcement of a stock split
all reflect our continuing positive outlook going forward," said Phil
Hawk, Team's Chairman and CEO.
Overall Fiscal Year 2007 Results
Operating income for the fourth quarter and full fiscal year was
$11.3 million and $30.3 million, respectively. Operating profit
margins (operating income as a percent of revenue) for the quarter and
full year were up substantially from corresponding prior year periods
and were 12 percent and 10 percent, respectively.
Team reported continued strong revenue and profit growth across
both divisions and nearly all service lines and geographic areas
during both the fourth quarter and full year. For the fourth quarter,
Team's revenues were $96 million, up 26 percent from the prior year
quarter. "We are pleased with the overall level of performance of our
industrial services business. Our revenue growth, continuing business
development successes, improved operating profit margins and
continuing growth in the number of qualified technicians are
noteworthy. In the coming year, we expect to benefit from both
continued organic growth across all business segments as well as from
our newly acquired Canadian inspection business," reported Phil Hawk.
TCM Division (Team's NDE inspection and field heat treating
service lines) revenues for the quarter were $55 million, up 33
percent from the prior year quarter. For the fiscal year, TCM revenues
were $171 million, up 19 percent. TCM gross margins for the quarter
and year were about 34 percent and 32 percent for the quarter and
year, respectively, up from about 30 percent in both corresponding
prior year periods. "We are pleased with our progress in improving our
margins, particularly in the fourth quarter. Continuing organic growth
and progress along with the addition of the Aitec inspection business
will result in exciting growth for the division in Fiscal Year 2008,"
said Hawk.
Revenues for the TMS Division (Team's mechanical service lines of
leak repair, hot tapping, fugitive emissions monitoring, field
machining, technical bolting and field valve repair) for the quarter
were $41 million, up 19 percent from the strong
"Katrina/Rita-influenced" prior year period. For the fiscal year, TMS
revenues were $147 million, up 26 percent. Gross margins for the
division were 37 percent and 38 percent for the quarter and for the
fiscal year, respectively. "We are very pleased with the continuing
strong outlook for the Division including additional revenue growth
from our new pipeline hot tapping, line isolation, and waterworks
initiatives," said Hawk.
The business outlook for FY2008 continues to be very attractive.
Team continues to gain market share across all its service lines, as a
result of its service capabilities combined with the continuing
customer trend toward multi-service, multi-location procurement
arrangements that favor larger industry providers like Team.
Approximately half of Team's $59 million in revenue growth in FY2007
was derived from expanded business with our major alliance customers.
For the coming year, a number of significant expansion projects
(particularly in the refining sector) should continue to augment the
large base of routine maintenance and turnaround project demand.
Despite our significant historic growth, our total market share is
less than 20 percent in this highly fragmented market, indicating
significant future growth potential.
Business Outlook/Guidance for Fiscal Year 2008
Based on an assumption of 10 percent organic revenue growth plus
the impact of the Aitec acquisition, the company expects its FY2008
revenue to slightly exceed $400 million. Based on this activity level,
net income is expected to be $2.00 to $2.20 per fully diluted share
before taking into consideration the impact of the stock split.
Consistent with its past practices, Team does not provide specific
guidance for individual quarters, but will confirm or update its
annual guidance at least quarterly.
Stock Split
For shareholders of record on August 15, 2007, the Board of
Directors has approved a stock dividend payable on August 29, 2007 in
which each shareholder will receive one additional common share for
each share owned. This action reflects the significant growth in our
company over the past several years and the Board's continuing
confidence in the company's outlook. Following the stock dividend,
restated earnings per share results and future earnings guidance will
be exactly one half pre-dividend amounts. The number of outstanding
common shares will double to about 18 million shares. Fully diluted
shares will increase to about 19.5 million shares at the time the
stock dividend is paid.
Earnings Conference Call
In connection with this earnings release, the Company will hold
its quarterly conference call on Thursday, July 26, 2007, at 10:00
a.m. Central Time (11:00 a.m. Eastern). The call will be broadcast
over the Web 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, conference code
9056257.
About Team, Inc.
Headquartered in Alvin, Texas, Team, Inc. is a leading provider of
specialty and construction services required in maintaining
high-temperature and high-pressure piping systems and vessels that are
utilized extensively in the refining, petrochemical, power, pipeline
and other heavy industries. The Company's inspection services also
serve a broader customer base that includes the aerospace and
automotive industries. Team offers these services in over 80 locations
throughout the United States, Aruba, Canada, Singapore, Trinidad and
Venezuela. The Company licenses its proprietary techniques and
materials to various companies outside the United States and receives
royalties based upon revenues earned by its licensees. Team, Inc.
common stock is traded on the NASDAQ Global Select Market under the
ticker symbol "TISI".
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.
TEAM, INC. AND SUBSIDIARIES
SUMMARY OF OPERATING RESULTS
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
May 31, May 31,
----------------------- -----------------------
2007 2006 2007 2006
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues $96,133 $76,010 $318,348 $259,838
Operating expenses 62,254 48,614 208,186 170,709
----------- ----------- ----------- -----------
Gross margin 33,879 27,396 110,162 89,129
Selling, general and
administrative
expenses 22,556 19,621 79,825 67,752
----------- ----------- ----------- -----------
Operating income 11,323 7,775 30,337 21,377
Interest expense, net 1,037 1,130 4,204 3,992
----------- ----------- ----------- -----------
Earnings before income
taxes 10,286 6,645 26,133 17,385
Provision for income
taxes 4,202 2,642 10,618 6,755
----------- ----------- ----------- -----------
Income from continuing
operations 6,084 4,003 15,515 10,630
Income from
discontinued
operations, net of
tax - - - 6
----------- ----------- ----------- -----------
Net income $ 6,084 $ 4,003 $ 15,515 $ 10,636
=========== =========== =========== ===========
Earnings per common
share:
Continuing
operations:
Basic $ 0.68 $ 0.47 $ 1.77 $ 1.26
=========== =========== =========== ===========
Diluted $ 0.63 $ 0.42 $ 1.64 $ 1.16
=========== =========== =========== ===========
Discontinued
operations:
Basic $ - $ - $ - $ -
=========== =========== =========== ===========
Diluted $ - $ - $ - $ -
=========== =========== =========== ===========
Net income
Basic $ 0.68 $ 0.47 $ 1.77 $ 1.26
=========== =========== =========== ===========
Diluted $ 0.63 $ 0.42 $ 1.64 $ 1.16
=========== =========== =========== ===========
Weighted average
number of shares
outstanding:
Basic 8,919 8,578 8,770 8,413
=========== =========== =========== ===========
Diluted 9,690 9,478 9,433 9,199
=========== =========== =========== ===========
Continuing operations
data:
Revenues comprised of:
TCM
Division $54,825 $41,246 $171,030 $143,233
TMS
Division 41,308 34,764 147,318 116,605
----------- ----------- ----------- -----------
$96,133 $76,010 $318,348 $259,838
=========== =========== =========== ===========
Gross margin comprised
of:
TCM
Division $18,780 $12,356 $ 54,478 $ 42,918
TMS
Division 15,099 15,040 55,684 46,211
----------- ----------- ----------- -----------
$33,879 $27,396 $110,162 $ 89,129
=========== =========== =========== ===========
Operating income
comprised of:
Industrial
Services $15,666 $11,243 $ 44,785 $ 32,467
Corporate (4,343) (3,468) (14,448) (11,090)
----------- ----------- ----------- -----------
$11,323 $ 7,775 $ 30,337 $ 21,377
=========== =========== =========== ===========
TEAM, INC. AND SUBSIDIARIES
SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION
May 31, 2007 AND May 31, 2006
(in thousands)
May 31, May 31,
2007 2006
-------------- --------------
(unaudited)
Current assets $ 107,513 $ 84,831
Net property, plant and equipment 35,166 26,448
Other non-current assets 28,375 28,692
-------------- --------------
Total assets $ 171,054 $139,971
============== ==============
Current liabilities $ 37,284 $ 35,612
Long term debt net of current
maturities 48,774 39,804
Other non-current liabilities and
minority interests 496 670
Stockholders' equity 84,500 63,885
-------------- --------------
Total liabilities and stockholders'
equity $ 171,054 $139,971
============== ==============
CONTACT: Team, Inc., Alvin
Ted W. Owen, 281-331-6154