Team, Inc. (TISI) said Monday that it will take a non-routine pre-tax charge which is expected to be about $1.8 million, or $0.06 per share after tax, in the third quarter ending February 28 associated with Venezuela's devaluation of its currency.
On January 8, the Venezuelan government announced its intention to significantly devalue its currency Bolivar.
Team operates a small service location in Punta Fijo, Venezuela, whose annual revenues have historically been less than one percent of Team's consolidated revenues, using the previously fixed exchange rate of 2.15 Bolivars per U.S. Dollar.
Because of the uncertain political environment in Venezuela, the company plans to use the "parallel" exchange rate for Bolivar denominated bonds, most recently quoted at about 6.00, to translate its Venezuelan assets, liabilities and results of operations effective as of the beginning of its fiscal 2010 third quarter.
Excluding the impact of this non-routine charge, the company said, the devaluation of the Bolivar does not affect its previously affirmed earnings guidance for full fiscal year 2010 of $0.85 to $1.05 per share.
Analysts polled by Thomson Reuters currently expect the company to earn $1.00 per share for the fiscal year 2010. Analysts' estimates typically exclude special items.
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