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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________

FORM 10-Q
 
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2005

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period_____________ to _____________
 
_________________________________
 
Commission file no. 0-15152

FIND/SVP, INC.
(Exact name of Registrant as specified in its charter)
 
New York
  
13-2670985
(State or other jurisdiction
of incorporation or organization)
  
(I.R.S. employer
identification no.)


625 Avenue of the Americas, New York, NY 10011
(Address of principal executive offices) (Zip code)

Registrant's telephone number, including area code: (212) 645-4500
 
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 x
NO o

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

YES o
NO x

Number of shares of Common Stock, $.0001 par value per share outstanding at May 9, 2005: 20,291,281


FIND/SVP, Inc. and Subsidiaries
Index
 
   
Page
PART I. Financial Information
     
ITEM 1. Financial Statements
 
 
Condensed Consolidated Balance Sheets
March 31, 2005 (unaudited) and December 31, 2004
3
 
 
  
 
Condensed Consolidated Statements of Operations
Three Months Ended March 31, 2005 and 2004 (as restated) (unaudited)
4
 
 
  
 
Condensed Consolidated Statements of Cash Flows
Three Months Ended March 31, 2005 and 2004 (as restated) (unaudited)
5
 
 
  
 
Notes to Condensed Consolidated Financial Statements (unaudited)
6
 
 
  
ITEM 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations
20
     
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
32
 
 
  
ITEM 4. Controls and Procedures
33
 
 
  
PART II. Other Information
 
 
  
ITEM 6. Exhibits
34
 
 
  
Signatures
35
 
 
  
Index to Exhibits
36
 
2

PART I.
FINANCIAL INFORMATION
 
ITEM 1.
Financial Statements
 
FIND/SVP, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)

Assets
 
March 31, 2005
  
December 31, 2004
  
   
(unaudited)
      
Current assets:
          
Cash and cash equivalents
  
$
6,100
  
$
4,519
  
Accounts receivable, net
    
6,968
    
6,215
  
Deferred tax assets
    
577
    
696
  
Prepaid expenses and other current assets
    
1,404
    
1,240
  
               
Total current assets
    
15,049
    
12,670
  
               
Equipment, software development and leasehold improvements, at cost, less accumulated depreciation and amortization of $11,075 at March 31, 2005 and $10,865 at December 31, 2004
    
2,202
    
2,336
  
               
Goodwill, net
    
12,417
    
12,214
  
Intangibles, net
    
968
    
1,002
  
Deferred tax assets
   
783
    
783
  
Deferred rent
    
292
    
335
  
Cash surrender value of life insurance
    
127
    
127
  
Non-marketable equity securities
    
23
    
23
  
Other assets
    
551
    
532
  
        
  
$
$32,412
  
$
30,022
  
               
Liabilities and Shareholders’ Equity
              
               
Current liabilities:
              
Trade accounts payable
  
$
2,305
  
$
1,267
  
Accrued expenses and other
    
4,701
    
5,099
  
Unearned retainer income
    
5,063
    
3,472
  
               
Total current liabilities
    
12,069
    
9,838
  
               
Deferred compensation and other liabilities
    
379
    
404
  
               
Total liabilities
    
12,448
    
10,242
  
               
Redeemable convertible preferred stock, $.0001 par value.
Authorized 2,000,000 shares; issued and outstanding 333,333 shares at March 31, 2005 and December 31, 2004, and accrued dividends
   
580
    
570
  
               
Redeemable common stock, $.0001 par value. Issued and outstanding 571,237 shares at March 31, 2005 and December 31, 2004
    
1,090
    
1,090
  
               
Commitments and contingencies (Note K)
              
               
Shareholders’ equity:
              
Common stock, $.0001 par value. Authorized 100,000,000 shares; issued and outstanding 18,831,254 shares at March 31, 2005 18,828,416 shares at December 31, 2004
    
2
    
2
  
Capital in excess of par value
    
26,137
    
25,850
  
Deferred stock-based compensation
    
(378
)
  
(214
)
Loan receivable for stock purchase
    
(50
)
  
(50
)
Accumulated deficit
    
(7,417
)
  
(7,468
)
               
Total shareholders’ equity
   
18,294
    
18,120
  
 
$
32,412
  
$
30,022
  

See accompanying notes to condensed consolidated financial statements.
 
3

FIND/SVP, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(unaudited)
Three months ended March 31,
(in thousands, except share and per share data)
 
   
2005
  
2004
  
       
(As restated for the adoption of SFAS No. 123 See Note A)
  
           
Revenues
  
$
8,786
  
$
9,606
  
               
Operating expenses:
              
Direct costs
    
5,274
    
5,455
  
Selling, general and administrative expenses
    
3,299
    
3,912
  
Total operating expenses
    
8,573
    
9,367
  
               
Operating income
   
213
    
239
  
               
Other income
    
14
    
--
  
Impairment of investment
    
--
    
(95
)
Equity loss on investment
    
(47
)
  
--
  
Interest expense
    
(4
)
  
(226
)
               
Income (loss) before (provision) benefit for income taxes
   
176
    
(82
)
               
(Provision) benefit for income taxes
    
(125
)
  
4
  
               
Net income (loss)
    
51
    
(78
)
               
Less: Preferred dividends
    
(10
)
  
(10
)
               
Less: Accretion on redeemable common shares
    
--
    
(113
)
               
Income (loss) attributable to common shareholders
  
$
41
  
$