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): July 26, 2006
PAR TECHNOLOGY CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 1-09720 16-1434688
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(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) incorporation or
organization) Identification Number)
PAR Technology Park
8383 Seneca Turnpike
New Hartford, NY 13413-4991
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (315) 738-0600
Not Applicable
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(Former Name or Former Address, if changed since Last Report)
Item 2.02 Results of Operations and Financial Condition.
(a) The information, including Exhibits attached hereto, in this Current Report
is being furnished and shall not be deemed "filed" for the purposes of
Section 18 of the Securities and Exchange Act of 1934, or otherwise subject
to the liabilities of that Section. The information in this Current Report
shall not be incorporated by reference into any registration statement or
other document pursuant to the Securities Act of 1933, as amended, except
as otherwise expressly stated in such filing.
(b) On July 26, 2006, PAR Technology Corporation issued a press release
announcing its results of operation for the quarterly period ending June
30, 2006. A copy of the press release is attached hereto as Exhibit 99.1
and is incorporated herein by reference.
99.1 Press Release dated July 26, 2006.
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.
PAR TECHNOLOGY CORPORATION
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(Registrant)
Date: July 26, 2006
/s/Ronald J. Casciano
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Ronald J. Casciano
Vice President, Chief Financial Officer
and Treasurer
EXHIBIT INDEX
Exhibit Number Description
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99.1 Press Release dated July 26, 2006.
Exhibit 99.1 Press Release dated July 26, 2006.
RELEASE: NEW HARTFORD, NY, July 26, 2006
CONTACT: Christopher R. Byrnes (315) 738-0600 ext. 226
cbyrnes@partech.com, www.partech.com
PAR TECHNOLOGY CORPORATION
-REPORTS SECOND QUARTER RESULTS-
o HIGHEST REVENUE FOR SECOND QUARTER IN COMPANY HISTORY
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NEW HARTFORD, NY, PAR TECHNOLOGY CORPORATION (NYSE:PTC)
New Hartford, NY--July 26, 2006--PAR Technology Corporation (NYSE:PTC - News)
today announced results for the second quarter ended June 30, 2006.
PAR reported second quarter revenues of $53.3 million, a 4% increase from the
$51.2 million reported in the same period a year ago. Net income of $2.34
million was reported for the second quarter 2006, compared with net income of
$2.35 million in the second quarter of 2005. Diluted earnings per share were
$0.16 for the second quarter of 2006, flat when compared to diluted earnings per
share of $0.16 for the second quarter of last year. PAR is now expensing stock
options and other share-based compensation in accordance with Statement of
Financial Accounting Standards No. 123R. The 2006 second quarter results include
non-cash stock-based compensation expense of $95,000, compared to no such
expense in the second quarter of 2005.
For the six months ended June 30, 2006, PAR Technology Corporation reported
revenues of $106 million, a 6% increase from the $100 million reported one year
ago. The Company also reported $4.3 million in net income for the first six
months of 2006 versus $3.7 million reported for the first six months of 2005, a
19% rise year over year. Diluted earnings per share rose 16% to $0.29 for the
first six months of 2006 compared to $0.25 reported for the first six months of
2005. In accordance with Statement of Financial Accounting Standards No. 123R
the first six months 2006 results include non-cash stock-based compensation
expense of $138,000 compared to no such expense for the first six months of
2005.
John W. Sammon, PAR Chairman & CEO commented, "Although posting record revenues
for our Company in the period, overall second quarter results were lower than
planned. Our Hospitality Technology business revenue did not meet our
expectations due to a combination of factors; the largest being lower than
expected hardware sales and a slight downturn in certain market segments such as
movie theatres. On the positive side, restaurant software and international
sales continued to be strong."
Sammon went on to say, "For the remainder of the year, we are anticipating a
slightly slowing domestic hospitality market particularly in the casual dining
and theatre sectors. Slowdown in these sectors will have an impact on our
business. There is less evidence of slow down in our core domestic quick service
restaurant business and our international business is expected to continue
double digit growth. We are also confident that our Government business will
remain on plan. Considering this quarter and our outlook for the remainder of
2006, I feel it prudent to lower our revenue and earnings per share expectations
for the year. Anticipating continued softness in certain segments of our
Hospitality business, we now anticipate top line growth for the year to be in
the range of 6% to 8% with similar bottom line growth."
"We believe the long term outlook for our hospitality segment is quite positive.
Our confidence stems from such events as PAR recently being selected by a major
customer to be their sole supplier of technology systems for their China based
restaurants. In addition, our Government Systems business continues to exceed
our operating plan and I have confidence that the positive trends in this
segment of our Company will continue."
Sammon concluded, "Our long term goal remains the same, to continue to invest in
and grow our hospitality technology businesses, and focus upon long term success
rather than short term gains. That strategy includes an aggressive marketing
program, international infrastructure expansion and new product development.
Although these initiatives involve incremental costs that impact near-term
earnings, we continue to believe these costs will translate into enhanced
profitability and shareholder value for the future."
Certain Company information in this release or by its spokespersons from time to
time may contain forward-looking statements. Any statements in this document
that do not describe historical facts are forward-looking statements.
Forward-looking statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. Investors are cautioned
that all forward-looking statements involve risks and uncertainties, including
without limitation, delays in new product introduction, risks in technology
development and commercialization, risks in product development and market
acceptance of and demand for the Company's products, risks of downturns in
economic conditions generally, and in the quick service sector of the restaurant
market specifically, risks of intellectual property rights associated with
competition and competitive pricing pressures, risks associated with foreign
sales and high customer concentration, and other risks detailed in the Company's
filings with the Securities and Exchange Commission.
ABOUT PAR TECHNOLOGY
PAR Technology Corporation develops, markets and supports hardware and software
products that improve the ability of hospitality business professionals to make
timely, fact-based business decisions. The Company is the world's largest
supplier of Point-of-Sale systems to the quick service restaurant market with
over 40,000 systems installed in more than 100 countries. In addition PAR is a
leader in providing computer based system design and engineering services to the
Department of Defense and other federal government agencies. PAR Technology
Corporation's stock is traded on the New York Stock Exchange under the symbol
PTC. For additional information visit PAR's website at www.partech.com.
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PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
(unaudited)
June 30, December 31,
2006 2005
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Assets
Current assets:
Cash and cash equivalents ........................... $ 2,068 $ 4,982
Accounts receivable-net ............................. 50,243 40,781
Inventories-net ..................................... 32,199 29,562
Income tax refunds .................................. 904 879
Deferred income taxes ............................... 4,356 5,690
Other current assets ................................ 2,848 2,598
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Total current assets ......................... 92,618 84,492
Property, plant and equipment - net ........................ 7,931 8,044
Goodwill ................................................... 20,854 20,622
Intangible assets - net .................................... 9,205 9,904
Other assets ............................................... 2,538 2,087
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$ 133,146 $ 125,149
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Liabilities and Shareholders' Equity
Current liabilities:
Current portion of long-term debt ................... $ 77 $ 76
Borrowings under lines of credit .................... 8,088 3,500
Accounts payable .................................... 12,472 12,703
Accrued salaries and benefits ....................... 8,861 9,725
Accrued expenses .................................... 2,205 2,352
Customer deposits ................................... 3,235 3,973
Deferred service revenue ............................ 10,749 11,332
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Total current liabilities .................... 45,687 43,661
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Long-term debt ............................................. 1,909 1,948
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Deferred income taxes ...................................... 695 201
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Other long-term liabilities ................................ 1,429 847
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Commitments and contingent liabilities
Shareholders' Equity:
Preferred stock, $.02 par value,
1,000,000 shares authorized ..................... -- --
Common stock, $.02 par value,
29,000,000 shares authorized;
15,959,386 and 15,914,958 shares issued;
14,181,082 and 14,136,654 outstanding ........... 319 318
Capital in excess of par value ...................... 37,736 37,271
Retained earnings ................................... 51,789 47,442
Accumulated other comprehensive loss ................ (490) (611)
Treasury stock, at cost, 1,778,304 shares ........... (5,928) (5,928)
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Total shareholders' equity ................... 83,426 78,492
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$ 133,146 $ 125,149
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PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(unaudited)
For the three months For the six months
ended June 30, ended June 30,
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2006 2005 2006 2005
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Net revenues:
Product ...................................... $ 22,710 $ 22,930 $ 45,730 $ 43,931
Service ...................................... 14,886 14,416 28,631 27,818
Contract ..................................... 15,747 13,874 31,579 28,228
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53,343 51,220 105,940 99,977
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Costs of sales:
Product ...................................... 13,074 13,893 25,872 26,769
Service ...................................... 10,840 10,923 21,550 21,370
Contract ..................................... 14,518 12,944 29,244 26,509
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38,432 37,760 76,666 74,648
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Gross margin ........................... 14,911 13,460 29,274 25,329
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Operating expenses:
Selling, general and administrative .......... 8,194 7,323 16,269 14,716
Research and development ..................... 2,836 2,107 5,735 4,385
Amortization of identifiable intangible assets 308 244 615 490
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11,338 9,674 22,619 19,591
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Operating income .................................. 3,573 3,786 6,655 5,738
Other income, net ................................. 218 71 375 304
Interest expense .................................. (167) (65) (252) (143)
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Income before provision for income taxes .......... 3,624 3,792 6,778 5,899
Provision for income taxes ........................ (1,286) (1,441) (2,428) (2,242)
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Net income ........................................ $ 2,338 $ 2,351 $ 4,350 $ 3,657
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Earnings per share
Basic ........................................ $ .16 $ .17 $ .31 $ .27
Diluted ...................................... $ .16 $ .16 $ .29 $ .25
Weighted average shares outstanding
Basic ........................................ 14,173 13,674 14,162 13,553
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Diluted ...................................... 14,776 14,642 14,802 14,510
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