UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): January 2, 2008
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Pre-Paid Legal Services, Inc.
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(Exact Name of Registrant as Specified in Its Charter)
Oklahoma
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(State or Other Jurisdiction of Incorporation)
001-09293 73-1016728
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(Commission File Number) (IRS Employer Identification No.)
One Pre-Paid Way
Ada, OK 74820
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(Address of Principal Executive Offices) (Zip Code)
(580) 436-1234
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
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On January 2, 2008, Pre-Paid Legal Services, Inc. (the "Company") issued a
press release announcing our membership production and recruiting information
for the three months ended December 31, 2007. A copy of the release is included
as an exhibit to this report.
Item 9.01 Financial Statements and Exhibits
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The following exhibits are included with this report:
Exhibit No. Description
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99.1 Company Press Release dated January 2, 2008
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.
Pre-Paid Legal Services, Inc.
By: /s/ Randy Harp
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Randy Harp, Chief Operating Officer
Date: January 2, 2008
For Immediate Release Company Steve Williamson
Wednesday, January 2, 2008 Contact: (580) 436-1234
PRE-PAID ANNOUNCES 2007 4th QUARTER & YEAR-END RESULTS
4th Quarter Memberships Up! 4th Quarter Recruiting Up!
ADA, OK, January 2, 2008 - Pre-Paid Legal Services, Inc. (NYSE: PPD), reported
new memberships produced and new sales associates enrolled for the fourth
quarter and for the year ended December 31, 2007. During the 4th quarter of
2007, new sales associates enrolled increased 2% to 36,029 from the 35,311
enrolled in the 4th quarter of 2006 and new memberships produced increased 7% to
150,100 during the 2007 quarter compared to 139,638 for the 2006 quarter.
For the year 2007, new sales associates enrolled decreased 14% to 148,802
compared to 172,999 enrolled during 2006 while new memberships produced were
612,096, down slightly from 612,726. Our active memberships increased 2% during
2007 from 1,538,740 to 1,575,802. From the 3rd quarter of 2007 to the 4th
quarter of 2007, our active memberships increased by 1,246 memberships.
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Three Months Ended: | Year Ended: |
New Memberships: 12/31/2007 9/30/2007 12/31/2006 | 12/31/2007 12/31/2006 |
---------------- ---------- ---------- ----------- | ---------- ---------- |
New legal service membership sales................. 139,282 145,530 131,628 | 570,637 584,408 |
New "stand-alone" IDT membership sales............. 10,818 8,771 8,010 | 41,459 28,318 |
---------- ---------- ----------- | ---------- ---------- |
Total new membership sales......................... 150,100 154,301 139,638 | 612,096 612,726 |
---------- ---------- ----------- | ---------- ---------- |
New "add-on" IDT membership sales.................. 94,945 100,888 88,255 | 381,419 389,157 |
| |
Average Annual Membership fee...................... $321.32 $325.98 $323.54 | $321.18 $328.36 |
Active Memberships|: | |
Active legal service memberships at end of period.. 1,492,341 1,496,319 1,473,710 | 1,492,341 1,473,710 |
Active "stand-alone" IDT memberships at end of | |
period (see note below)........................ 83,461 78,237 65,030 | 83,461 65,030 |
---------- ---------- ----------- | ---------- ---------- |
Total active memberships at end of period.......... 1,575,802 1,574,556 1,538,740 | 1,575,802 1,538,740 |
---------- ---------- ----------- | ---------- ---------- |
Active "add-on" IDT memberships at end of period | |
(see note below)............................... 631,910 616,919 540,253 | 631,910 540,253 |
New Sales Associates: | |
New sales associates recruited..................... 36,029 43,555 35,311 | 148,802 172,999 |
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Average enrollment fee paid by new sales associates $48.99 $40.74 $49.47 | $56.75 $49.69 |
Average Membership fee in force: | |
Average Annual Membership fee...................... $297.62 $297.52 $293.00 | $297.62 $293.00 |
| |
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Note - reflects 5,824 net transfers from "add-on" status to "stand-alone" status during the quarter
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Our total active membership premium in force increased approximately 4% during
2007 and represents the 15th consecutive year of increasing our membership fees.
The membership persistency rate (defined as the number of memberships in force
at the end of a 12 month period as a percentage of the total of memberships in
force at the beginning of such period, plus new memberships sold during such
period) was 73.3% for 2007.
Our fourth quarter 2007 corporate finance focus has again been on share
repurchases. During the 4th quarter, we returned $22.9 million to shareholders
through the repurchase of 446,682 shares of common stock, at an average per
share price of $51.27. Since April 1999, we have returned $362.4 million to
shareholders through the purchase of 12.7 million shares, average price of
$28.56 per share, and $17.1 million in dividends for a combined total of more
than $379 million representing more than 115 percent of our net earnings during
the same timeframe. We have reduced the number of shares outstanding by
approximately 47% from 23.6 million at March 31, 1999 to 12.4 million today.
We anticipate announcing our 2007 fourth quarter and yearly earnings on February
19, 2008 after the market closes and hosting a conference call to discuss such
earnings on February 21, 2008.
About Us - We believe our products are one of a kind, life events legal service
plans. Our plans provide for legal service benefits provided through a network
of independent law firms across the U.S. and Canada, and include unlimited
attorney consultation as well as will preparation, traffic violation defense,
automobile-related criminal charges defense, letter writing, document
preparation and review and a general trial defense benefit. We have an identity
theft restoration product we think is also one of a kind because of the
combination of outside vendors and our provider law firms. More information
about us and our products can be found at our homepage at
http://www.prepaidlegal.com.
Forward-Looking Statements
Statements in this press release, other than purely historical information,
regarding our future plans and objectives and expected operating results,
dividends and share repurchases and statements of the assumptions underlying
such statements, constitute forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934. The forward-looking
statements contained herein are based on certain assumptions that may not be
correct. They are subject to risks and uncertainties incident to our business
that could cause actual results to differ materially from those described in the
forward-looking statements. These risks and uncertainties are described in the
reports and statements filed by us with the Securities and Exchange Commission,
including (among others) those listed in our Form 10-K, Form 10-Q and Form 8-K,
and include the risks that our membership persistency or renewal rates may
decline, that we may not be able to continue to grow our memberships and
earnings, that we are dependent on the continued active participation of our
principal executive officer, that future litigation may have a material adverse
effect on us if resolved unfavorably to us, that we could be adversely affected
by regulatory developments, that competition could adversely affect us, that we
are substantially dependent on our marketing force, that our stock price may be
affected by short sellers, that we have been unable to significantly increase
our employee group membership sales and that our active premium in force is not
indicative of future revenue as a result of changes in active memberships from
cancellations and additional membership sales. Please refer to pages 14 and 15
of our 2006 Form 10-K and pages 7 and 8 of our September 30, 2007 Form 10-Q for
a more complete description of these risks. We undertake no duty to update any
of the forward-looking statements in this release.
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