SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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) May 6, 2004
ENGLOBAL CORPORATION
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(Exact name of registrant as specified in its chapter)
Nevada 001-14217 88-0322261
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
600 Century Plaza Drive, Suite 140, Houston, Texas 77073-6033
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 281-821-3200
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(Former name or former address, if changed since last report)
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Number Exhibit
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99.1 Press Release, dated May 6, 2004, of ENGlobal Corporation
Item 9. Regulation FD Disclosure
On May 6, 2004, ENGlobal Corporation issued a press release, a copy of which is
set forth below. In accordance with General Instructions B.2. Form 8-K, the
following information shall not be deemed "filed" for purposes of Section 18 of
the Securities Exchange Act of 1934, as amended, nor shall it 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.
ENGLOBAL CORPORATION ANNOUNCES FIRST QUARTER RESULTS AND
ALLIANCE RELATIONSHIP WITH A GLOBAL ENERGY COMPANY
HOUSTON, TX, MAY 6, 2004 - ENGlobal Corporation (AMEX: ENG), a leading provider
of engineering services, today reported net income of $0.02 per share for the
quarter ended March 31, 2004, equivalent to results from the same period in
2003. ENGlobal also announced that it has been selected by a global energy
company to become one of a very limited number of Preferred Service Providers
for engineering services. ENGlobal expects this client to utilize its
capabilities on a wide variety of upstream, midstream and downstream projects
that will primarily be located on the Gulf Coast.
Revenue for the most recent quarter totaled $31 million, an increase of
approximately $8 million, or 35%, compared to the prior year period. This
increase in revenue was primarily due to the continuation of several significant
projects that began in 2003 in the Company's engineering segment.
The Company's consolidated gross profit increased by $234,000 for the first
quarter 2004 compared to the first quarter 2003. Gross profits for ENGlobal's
engineering segment increased in the first quarter of 2004 over the first
quarter of 2003 by $518,000, totaling $3.6 million in the most recent quarter.
This improvement is the result of higher revenues in the engineering segment as
well as internal efforts to improve utilization of personnel.
Lower gross profit realized by ENGlobal's systems segment during the quarter
partially offset the improvements in the engineering segment. However, the
systems segment, as a whole, recorded significantly improved financial results
late in the first quarter and was recently awarded two contracts valued at
approximately $2 million. The systems segment appears to be experiencing a
general increase in activity, to varying degrees, as measured in terms of
proposals, bookings and shipments. Based on these trends, the Company expects
that operating results from its systems segment may improve over the remainder
of this year.
Expenses related to selling, general and administrative, including depreciation
and amortization increased $427,000, or 14.8%, for the first quarter 2004 as
compared to the same period in 2003. Much of the increase resulted from start-up
expenses at ENGlobal Design Group, Inc., which began operations earlier this
year. ENGlobal Design Group, Inc.'s financial results are consolidated into the
Company's system segment.
The Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2004
will be filed with the Securities and Exchange Commission on or about May 7,
2004 reflecting these results.
As previously reported, the Company's newest operation, ENGlobal Design Group,
Inc., has relocated to new space at the Company's Tulsa office at CitiPlex
Tower. This subsidiary provides engineering and related services to various
government and public sector clients, with projects primarily related to
automated fuel handling. This recent move is expected to provide these clients
with greater access to the complete range of ENGlobal's resources, and improve
the efficiency of the Company's Tulsa operations. Since beginning operations in
January 2004, ENGlobal Design Group, Inc. has been awarded over ten projects
valued at approximately $5.5 million.
Michael L. Burrow, ENGlobal's Chairman and CEO, stated, "ENGlobal's core
engineering segment continues to perform well, exceeding our budgetary
expectations and also exceeding results from last year. Management is continuing
to make decisions regarding the systems segment that we hope will allow this
group to show improved financial results. We are encouraged by the trends we are
seeing in this area, as well as by several new systems contracts that ENGlobal
has been awarded. As a result, and based on current trends, management is
optimistic that ENGlobal's financial results will improve over the remainder of
this year."
FINANCIAL HIGHLIGHTS
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(in thousands, except per share data)
For the three months ended
March 31
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2004 2003*
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Income Statement Data:
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Revenue $30,993 $23,006
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Net income per share (basic and diluted) .02 .02
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Weighted average number of shares
outstanding (basic) 24,034 22,861
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Weighted average number of shares
outstanding (diluted) 24,487 23,290
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As of
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March 31, 2004 December 31, 2003
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Balance Sheet Data:
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Working Capital $ 7,879 $ 6,505
Property and Equipment, net 4,721 4,302
Total Assets 40,609 42,530
Long-term Debt 8,526 8,129
Capital Leases 14 18
Stockholders' Equity 18,646 18,175
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* Income statement data for the three months ended March 31, 2003 does not take
into account the conversion of the Company's Series A Preferred Stock that
occurred in August 2003.
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About ENGlobal Corporation
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ENGlobal Corporation provides engineering services and systems principally to
the petroleum refining, petrochemical, pipeline, production, and process
industries throughout the United States and internationally. ENGlobal's
multi-disciplinary engineering services group develops projects from the initial
planning stage through detailed design, procurement, and construction
management. The systems group develops, manufactures, installs, and services
control and instrumentation systems utilized in various energy and
process-related industries, and provides services and products that support the
advanced automation and environmental technology fields. The Company, with its
subsidiaries, now employs over 1,000 employees and occupies over 250,000 square
feet of office and manufacturing space. Further information about the Company
and its subsidiaries is available at www.ENGlobal.com.
Safe Harbor for Forward-Looking Statements
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Certain matters discussed in this press release may constitute forward-looking
statements within the meaning of the federal securities laws and are subject to
risks and uncertainties including, but not limited to, the Company's ability to
achieve its business strategy while effectively managing costs and expenses.
Actual results and the timing of certain events could differ materially from
those projected in or contemplated by the forward-looking statements due to a
number of factors detailed from time to time in ENGlobal's filings with the
Securities and Exchange Commission. Reference is hereby made to cautionary
statements set forth in the Company's Form 10-K for the year ended December 31,
2003, Form 10-Q's for the quarters ended March 31, 2004, June 30, 2003 and
September 30, 2003, current Forms 8-K, and other SEC filings. Among other
matters, there can be no assurance that operating results from the systems
segment will improve or that the Company will provide significant services under
its new contract or that the provision of those services will be profitable. In
addition, the information contained in this press release is also subject to the
risk factors identified in the Company's Annual Report on Form 10-K for the year
ended December 31, 2003.
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.
ENGlobal Corporation
Date: May 7, 2004 /s/ Natalie S. Hairston
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Natalie S. Hairston, Investor Relations
Officer, Chief Governance Officer and
Corporate Secretary