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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): March 6, 2009

 

SPAR Group, Inc.

(Exact Name of Registrant as Specified in Charter)

 

 

Delaware  

 

0-27824  

 

33-0 684451  

 
 

(State or Other Jurisdiction of Incorporation)

 

(Commission
File No.)

 

(IRS Employer
Identification No.)

 
             

560 White Plains Road, Suite 210, Tarrytown, New York

        

10591

(Address of Principal Executive Offices)

(Zip Code)



 

 

Registrant’s telephone number, including area code: (914) 332-4100

 

(Former Name or Former Address, if Changed Since Last Report)

 


 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 2.02.

Results of Operations and Financial Condition.



(a)     On March 6, 2009, SPAR Group, Inc. (the "Registrant"), issued the press release attached to this Current Report on Form 8-K (the "Report") as Exhibit 99.1 reporting its financial results for the fourth quarter and fiscal year ended December 31, 2008, which is incorporated herein by reference. 

         The information in Item 2.02 of this Report, including Exhibit 99.1, shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. It shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01.

Financial Statements and Exhibits.


(a)             Exhibits:

99.1     Press Release of the Registrant dated March 6, 2009.


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 thereunto duly authorized.

 

SPAR Group, INC.

Date:     March 12, 2009

By:    /s/  James R. Segreto              

 

James R. Segreto

Chief Financial Officer



 

 

 


 

 

EXHIBIT INDEX

                                   

Exhibit

Number

 Description

99.1

Press Release of the Registrant dated March 6, 2009.



 

Exhibit 99.1

 

                                                                                           

NEWS

RELEASE

CONTACTS

James R. Segreto

Chief Financial Officer

SPAR Group, Inc.

(914) 332-4100

Roger S. Pondel / Judy Lin Sfetcu
PondelWilkinson Inc.
(310) 279-5980

 

TARRYTOWN, NY — March 6, 2009 SPAR Group, Inc. (NASDAQ:SGRP) today reported significant increases in net revenues and net income for the year ended December 31, 2008 compared with 2007, although results for the 2008 fourth quarter were below the prior year period.

For the 2008 fourth quarter, the company recorded net income of $467,000, equal to $0.02 per diluted share, which included an expense concession of $400,000 from an affiliate compared with net income of $1.5 million, or $0.08 per diluted share, for the same period in 2007. Net revenues were $16.0 million, compared with $18.4 million for the 2007 fourth quarter.

Operating income for the fourth quarter ended December 31, 2008 was $487,000, compared with $1.4 million in the corresponding period last year. Selling, general and

 

(more)


 

administrative expenses for the 2008 fourth quarter were reduced to $5.0 million from $5.1 million a year ago.

Revenue in the U.S. for SPAR Group’s 2008 fourth quarter was $8.0 million, compared with $9.4 million a year ago. U.S. operations reported net income of $973,000 for the 2008 fourth quarter, compared with $1.8 million for the same period last year.

International revenue for quarter ended December 31, 2008 was $8.0 million, compared with $9.0 million for the same quarter last year. The net loss in 2008 for the international division increased to $506,000 from a net loss of $359,000 last year, primarily due to additional tax expense resulting from a change in tax filing status in Japan.

For the year ended December 31, 2008, the company reported improvements in all areas. Revenues advanced 14.7% to $69.6 million from $60.7 million for the prior year. SPAR Group recorded net income of $102,000 for 2008, or $0.01 per share, which included $458,000 in non-recurring litigation costs, an expense concession of $900,000 from its affiliates, and $170,000 in tax benefits compared with a net loss of $2.5 million, or $0.13 per share, for 2007. Operating income for 2008 improved to $1.5 million, compared with an operating loss of $2.0 million in 2007. Selling, general and administrative expenses for 2008 were reduced 9.5% to $18.5 million from $20.5 million a year ago.

     For the year ended December 31, 2008, revenue in the U.S. advanced 4.7% to $30.8 million from $29.4 million in 2007. The company posted net income of $215,000 from its U.S. operations for 2008, compared with a net loss of $1.5 million for 2007.

International revenues for the full 2008 year increased 24.0% to $38.8 million from $31.3 million for 2007. The international division posted 2008 net loss of $113,000, down sharply from a net loss of $979,000 last year.

     “The improved results for the full year 2008 were attributable to continued growth in revenue and profitability over the prior year losses from both the US and International operations,” said Gary Raymond, president and chief executive officer. “Results for the year also benefitted from new business opportunities and continued close attention to cost controls throughout the company.”

“The effects of the economic downturn were exacerbated for SPAR Group, as

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with many organizations, in the fourth quarter,” Raymond said. “As our team works diligently to weather the current challenges, we believe our innovative, technology-driven products and services are needed more than ever today, and we are working closely with manufacturer and retailer customers to help them achieve their sales objectives on a cost effective basis.”

About SPAR Group

SPAR Group, Inc. is a diversified international marketing services company, providing a broad array of services to help companies improve their sales, operating efficiency and profits at retail worldwide. The company provides in-store merchandising, in-store event staffing, RFID and other technology, as well as research, to manufacturers and retailers covering all product classifications and all classes of trade, including mass market, drug store, convenience store and grocery chains. The company operates throughout the United States and internationally in Japan, Canada, Turkey, South Africa, India, Romania, China, Lithuania, Latvia, Estonia, Australia and New Zealand. For more information, visit SPAR Group’s Web site, www.sparinc.com.

Certain statements in this news release are forward-looking, and the company’s actual results, performance and trends could differ materially from those indicated or implied by such statements as a result of various factors, including (without limitation), the continued strengthening of SPAR Group’s selling and marketing functions, continued customer satisfaction and contract renewal, new product development, continued availability of capable dedicated personnel, continued cost management, the success of its international efforts, success and availability of acquisitions, availability of financing and other factors, as well as by factors applicable to most companies such as general economic, competitive and other business and civil conditions. Information regarding certain of these and other factors that could affect future results, performance or trends are discussed in SPAR Group’s annual report on Form 10-K , quarterly reports on Form 10-Q, and other filings made with the Securities and Exchange Commission from time to time.

# # #

(Tables follow)

 


 

 

Three Months Ended

Twelve Months Ended

   

December 31,
2008

 

December 31,
2007

December 31,
2008

December 31,
2007

             

Net revenues

$

15,976

$

18,432

$

69,611

$

60,716

Cost of revenues

 

10,248

 

11,730

 

48,688

 

41,468

Gross profit

 

5,728

 

6,702

20,923

19,248

             

Selling, general and administrative expenses

 

4,971

 

5,126

18,514

20,466

Depreciation and amortization

 

270

 

197

 

939

 

768

Operating income (loss)

 

487

 

1,379

1,470

(1,986

)

             

Interest expense

 

74

 

68

328

315

Other (income) expense

 

(194

)

 

12

 

671

 

39

Income (loss) before provision (benefit) for income taxes and minority interests

 

607

 

1,299

471

(2,340

)

Provision (benefit) for income taxes

 

527

 

(63

)

 

532

 

157

Income (loss) before minority interest

 

80

 

1,362

(61

)

(2,497

)

             

Minority interest (income) expense

 

(387

)

 

(88

)

 

(163

)

 

47

Net income (loss)

$

467

$

1,450

$

102

$

(2,544

)

             

Basic/diluted net income (loss) per common share:

           
             

Net income (loss) – basic/diluted

$

0.02

$

0.08

$

0.01

$

(0.13

)

             

Weighted average common shares – basic

 

19,139

 

19,089

 

19,130

 

19,011

             

Weighted average common shares – diluted

 

19,179

 

19,298

 

19,315

 

19,011




 

 

December 31,
2008

December 31,
2007

Assets

   

Current assets:

   

Cash and cash equivalents

$

1,782

$

1,246

Accounts receivable, net

13,110

13,748

Prepaid expenses and other current assets

1,446

975

 

16,338

15,969

Total current assets

   
     

Property and equipment, net

1,804

1,528

Goodwill

798

798

Other assets

1,806

1,648

Total assets

$

20,746

$

19,943

     

Liabilities and stockholders' equity

   

Current liabilities:

   

Accounts payable

$

4,589

$

3,631

Accrued expenses and other current liabilities

4,911

3,981

Accrued expense due to affiliates

1,398

2,107

Customer deposits

582

580

Lines of credit

5,494

6,119

     

Total current liabilities

16,974

16,418

     

Minority interest and other long-term liabilities

593

975

Total liabilities

17,567

17,393

     

Commitments and contingencies

   
     

Stockholders' equity:

   

Preferred stock, $.01 par value:

   

   Authorized shares-3,000,000

   

   Issued and outstanding shares-554,402

6

-

Common stock, $.01 par value:

   

   Authorized shares-47,000,000

   

   Issued and outstanding shares-

   

      19,139,365 - December 31, 2008

   

      19,089,177 - December 31, 2007

190

191

Treasury stock

(1

)

(1

)

Additional paid-in capital

12,822

11,982

Accumulated other comprehensive loss

(361

)

(43

)

Accumulated deficit

(9,477

)

(9,579

)

Total stockholders' equity

3,179

2,550

Total liabilities and stockholders' equity

$

20,746

$

19,943