Team, Inc. Reports 2nd Quarter Earnings and Affirms Full Year Guidance

ALVIN, Texas, Jan. 5 /PRNewswire-FirstCall/ -- Team, Inc., (Nasdaq: TISI) today reported net income of $5.8 million ($0.30 per diluted share) for its second quarter ended November 30, 2009. Results for the quarter included pre-tax, non-routine legal and accounting costs of $1.2 million ($.04 per diluted share, after tax) related to an ongoing, independent investigation. Excluding the non-routine costs, net income would have been $6.6 million ($0.34 per diluted share). Revenues for the six months ended November 30, 2009 were $224.2 million and net income for the same period was $7.0 million ($0.36 per diluted share), or $8.4 million ($0.43 per diluted share) excluding the non-routine charges relating to the investigation. The Company also affirmed its full year earnings guidance of $0.85 to $1.05 per diluted share (excluding the effect of the non-routine charges).

(Logo: http://www.newscom.com/cgi-bin/prnh/20090602/TEAMINCLOGO)

"I am generally pleased with the performance of our business in this weak economic climate. Our focus has been on managing our costs, maintaining our profitability, expanding our financial flexibility, and staying well-positioned for continued long-term business growth," said Phil Hawk, Team's Chairman and CEO.

Second Quarter Performance

Team's revenues during the quarter were $123.3 million, down $25.5 million from the record setting corresponding prior year quarter. Similarly, revenues for the six months ended November 30, 2009 were $224.2 million, down $47.9 million from the prior year. The comparable prior year results represented the best results in Team history as the effects of the current recession were not felt by Team until later in the prior fiscal year. The decline in revenues during the current fiscal year was broad based, affecting nearly all of Team's geographic regions and service lines.

Team's operating income for the current quarter was $10.3 million, earnings before income tax was $9.6 million and net income was $5.8 million. These results include non-routine outside professional costs of $1.2 million related to an external investigation. Excluding the non-routine costs, operating income would have been $11.5 million, and net income would have been $6.6 million. Team's operating income for the six months ended November 30, 2009 was $12.9 million, and net income was $7.0 million. Excluding non-routine costs of $2.3 million for the current six month period, operating income would have been $15.2 million, and net income would have been $8.4 million.

Actions taken to reduce Team's overall cost structure and improve efficiency in both its field service and corporate support activities contributed to the Company's performance. SG&A for the current quarter, when adjusted for the non-routine investigation costs, decreased $3.9 million compared to the prior year quarter.

As previously reported, the Audit Committee is conducting an independent investigation regarding possible violations of the Foreign Corrupt Practices Act ("FCPA") in cooperation with the U.S. Department of Justice and the Securities and Exchange Commission. While the investigation is ongoing, management continues to believe that any possible violations of the FCPA are limited in size and scope. The investigation is now expected to be completed during the first calendar quarter of 2010. The total professional costs associated with the investigation are now projected to be about $3.0 million.

Team Affirms Full Year Guidance

Team is affirming its earnings guidance of $0.85 to $1.05 per fully diluted share for fiscal year 2010. Such guidance excludes the impact of the non-routine investigation costs. Earnings guidance is based on the expectation that revenues in the second half of the year will be approximately 10% higher than in the first half of the year.

Earnings Conference Call

In connection with this earnings release, Team will hold its quarterly conference call on Wednesday, January 6, 2010 at 8:00 a.m. Central Time (9:00 a.m. Eastern). The call will be broadcast over the Web and can be accessed on Team's Website, www.teamindustrialservices.com. Individuals wishing to participate in the conference call by phone may call 877-826-1586 and use conference code 26083904.

About Team, Inc.

Headquartered in Alvin, Texas, Team Inc. is a leading provider of specialty industrial services required in maintaining and installing high-temperature and high-pressure piping systems and vessels that are utilized extensively in the refining, petrochemical, power, pipeline and other heavy industries. Team offers these services in over 100 locations throughout the United States, Angola, Belgium, Canada, Singapore, The Netherlands, Trinidad and Venezuela. Team's 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 of 1995. We have made reasonable efforts to ensure that the information, assumptions and beliefs upon which this forward-looking information is based are current, reasonable and complete. Such forward-looking statements involve estimates, assumptions, judgments and uncertainties. There are known and unknown factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking information. Such known factors are detailed in the Company's Annual Report on Form 10-K for the year ended May 31, 2009 and in the Company's Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission, and in other reports filed by the Company with the Securities and Exchange Commission from time to time. Accordingly, there can be no assurance that the forward-looking information contained herein will occur or that objectives will be achieved. We assume no obligation to publicly update or revise any forward-looking statements made today or any other forward-looking statements made by the company, whether as a result of new information, future events or otherwise.

                           TEAM, INC. AND SUBSIDIARIES
                           SUMMARY OF OPERATING RESULTS
                       (in thousands, except per share data)

                                   Three Months Ended     Six Months Ended
                                       November 30,          November 30,
                                       ------------          ------------
                                     2009       2008       2009       2008
                                     ----       ----       ----       ----
                                 (unaudited)(unaudited)(unaudited)(unaudited)

    Revenues                       $123,292   $148,752   $224,229   $272,090

    Operating expenses               83,844     98,667    155,347    182,896
                                     ------     ------    -------    -------
    Gross margin                     39,448     50,085     68,882     89,194

    Selling, general and
     administrative expenses         29,403     32,132     56,432     61,790
    Earnings from
     unconsolidated
     affiliates                         232        411        491        675
                                        ---        ---        ---        ---
    Operating income                 10,277     18,364     12,941     28,079

    Interest expense, net               697      1,378      1,502      2,825
                                        ---      -----      -----      -----
    Earnings before income taxes      9,580     16,986     11,439     25,254

    Provision for income taxes        3,739      6,769      4,473     10,080
                                      -----      -----      -----     ------
    Net income                       $5,841    $10,217     $6,966    $15,174
                                     ======    =======     ======    =======


    Earnings per common
     share:
          Basic                       $0.31      $0.54      $0.37      $0.81
                                      =====      =====      =====      =====
          Diluted                     $0.30      $0.51      $0.36      $0.76
                                      =====      =====      =====      =====

    Weighted average number
     of shares outstanding:
          Basic                      18,925     18,823     18,890     18,752
                                     ======     ======     ======     ======
          Diluted                    19,492     19,853     19,442     19,881
                                     ======     ======     ======     ======


    Continuing operations data:


      Revenues comprised of:
              TCM Division          $71,322    $76,126   $128,626   $141,381
              TMS Division           51,970     72,626     95,603    130,709
                                     ------     ------     ------    -------
                                   $123,292   $148,752   $224,229   $272,090
                                   ========   ========   ========   ========

      Gross margin comprised of:
              TCM Division          $22,319    $23,465    $38,800    $43,534
              TMS Division           17,129     26,620     30,082     45,660
                                     ------     ------     ------     ------
                                    $39,448    $50,085    $68,882    $89,194
                                    =======    =======    =======    =======

      Operating income comprised of:
              Industrial services    $16,162    $23,003    $24,489    $37,568
              Earnings from
               unconsolidated
               affiliates               232        411        491        675
              Non-routine
               investigation costs   (1,204)         -     (2,306)         -
              Corporate              (4,913)    (5,050)    (9,733)   (10,164)
                                     ------     ------     ------    -------
                                    $10,277    $18,364    $12,941    $28,079
                                    =======    =======    =======    =======

                               TEAM, INC. AND SUBSIDIARIES
                      SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION
                           NOVEMBER 30, 2009 AND  MAY 31, 2009
                                      (in thousands)

                                                        November 30,   May 31,
                                                            2009        2009
                                                            ----        ----
                                                         (unaudited)

    Current assets                                        $150,590    $156,637

    Property, plant and equipment, net                      58,049      59,582

    Other non-current assets                                62,355      59,702

                                                          --------    --------
    Total assets                                          $270,994    $275,921
                                                          ========    ========

    Current liabilities                                    $38,121     $46,792

    Long term debt net of current maturities                67,206      76,689

    Other non-current liabilities                            6,725       5,939

    Stockholders' equity                                   158,942     146,501

                                                          --------    --------
    Total liabilities and stockholders' equity            $270,994    $275,921
                                                          ========    ========

SOURCE Team, Inc.