UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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(Mark One) |
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ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended March 31, 2005 |
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OR |
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o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from to |
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Commission File Number 1-7516 |
KEANE, INC.
(Exact name of registrant as specified in its charter)
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MASSACHUSETTS |
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04-2437166 |
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(State or other jurisdiction of |
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(I.R.S. Employer Identification |
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100 City Square, Boston, Massachusetts |
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02129 |
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(Address of principal executive offices) |
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(Zip Code) |
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Registrant’s telephone number, including area code (617) 241-9200 |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ý No o
As of March 31, 2005, there were 62,372,747 shares of Common Stock, $.10 par value per share, and no shares of Class B Common Stock issued and outstanding.
Keane, Inc.
Table of Contents
2
Part I. Financial Information
Item 1. Financial Statements
Keane, Inc.
Unaudited Condensed Consolidated Statements of Income
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Three Months Ended March 31, |
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2005 |
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2004 |
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(In thousands except per share amounts) |
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Revenues |
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$ |
232,204 |
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$ |
215,824 |
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Operating expenses |
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Salaries, wages, and other direct costs |
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162,193 |
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149,990 |
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Selling, general, and administrative expenses |
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54,172 |
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53,217 |
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Amortization of intangible assets |
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4,070 |
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3,913 |
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Operating income |
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11,769 |
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8,704 |
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Other income (expense) |
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Interest and dividend income |
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1,105 |
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1,055 |
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Interest expense |
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(1,416 |
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(1,438 |
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Other (expense) income, net |
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(16 |
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125 |
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Minority interest |
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683 |
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761 |
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Income before income taxes |
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12,125 |
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9,207 |
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Provision for income taxes |
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4,850 |
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3,683 |
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Net income |
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$ |
7,275 |
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$ |
5,524 |
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Basic earnings per share |
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$ |
0.12 |
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$ |
0.09 |
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Diluted earnings per share |
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$ |
0.11 |
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$ |
0.08 |
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Basic weighted average common shares outstanding |
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62,156 |
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63,650 |
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Diluted weighted average common shares and common share equivalents outstanding |
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71,028 |
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73,004 |
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The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
3
Keane, Inc.
Unaudited Condensed Consolidated Balance Sheets
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March 31, |
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December 31, |
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(Unaudited) |
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(Dollars in thousands) |
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Assets |
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Current: |
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Cash and cash equivalents |
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$ |
80,969 |
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$ |
67,488 |
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Restricted cash |
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1,790 |
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986 |
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Marketable securities |
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127,020 |
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130,678 |
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Accounts receivable, net |
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142,957 |
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126,467 |
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Prepaid expenses and deferred taxes |
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15,598 |
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16,515 |
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Total current assets |
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368,334 |
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342,134 |
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Property and equipment, net |
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76,509 |
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76,761 |
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Goodwill |
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309,594 |
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305,965 |
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Customer lists, net |
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50,049 |
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53,040 |
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Other intangible assets, net |
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8,804 |
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9,904 |
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Other assets, net |
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15,415 |
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16,390 |
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Total assets |
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$ |
828,705 |
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$ |
804,194 |
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Liabilities |
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Current: |
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Short-term debt |
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$ |
671 |
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$ |
892 |
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Accounts payable |
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6,939 |
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9,511 |
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Accrued restructuring |
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4,054 |
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3,513 |
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Unearned income |
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10,805 |
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9,376 |
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Accrued compensation |
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45,630 |
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39,763 |
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Accrued expenses and other liabilities |
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64,386 |
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52,760 |
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Total current liabilities |
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132,485 |
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115,815 |
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Long-term debt |
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150,013 |
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150,017 |
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Accrued long-term building costs |
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39,414 |
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39,545 |
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Accrued long-term restructuring |
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4,167 |
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5,164 |
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Deferred income taxes |
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26,570 |
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25,924 |
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Total liabilities |
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352,649 |
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336,465 |
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