<PAGE>
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 September 30, 1999
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File Number: 000-28600
CCC INFORMATION SERVICES GROUP INC.
(Exact name of registrant as specified in its charter)
DELAWARE 54-1242469
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
WORLD TRADE CENTER CHICAGO
444 MERCHANDISE MART
CHICAGO, ILLINOIS 60654
(Address of principal executive offices, including zip code)
(312) 222-4636
(Registrant's telephone number, including area code)
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
--- ---
As of November 5, 1999, CCC Information Services Group Inc. common stock, par
value $0.10 per share, outstanding was 21,899,266 shares.
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION Page(s)
<S> <C> <C>
Item 1. Financial Statements
Consolidated Interim Statement of Operations (Unaudited),
Three Months and Nine Months Ended September 30, 1999 and 1998 3
Consolidated Interim Balance Sheet,
September 30, 1999 (Unaudited) and December 31, 1998 4
Consolidated Interim Statement of Cash Flows (Unaudited),
Nine Months Ended September 30, 1999 and 1998 5
Notes to Consolidated Interim Financial Statements (Unaudited) 6-10
Item 2. Management's Discussion and Analysis
of Results of Operations and Financial Condition 11-15
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 2. Changes in Securities 15
Item 3. Defaults Upon Senior Securities 15
Item 4. Submission of Matters to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15-16
SIGNATURES 17
EXHIBIT INDEX 18
</TABLE>
2
<PAGE>
CCC INFORMATION SERVICES GROUP INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED INTERIM STATEMENT OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1999 1998 1999 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenues $ 51,649 $ 48,048 $ 152,526 $ 138,886
Expenses:
Production and customer support 16,577 12,854 45,726 33,596
Commissions, royalties and licenses 3,858 5,540 12,708 16,385
Selling, general and administrative 19,421 16,006 58,453 44,198
Depreciation and amortization 2,589 2,405 7,515 6,846
Product development and programming 5,487 6,644 17,457 19,710
Relocation of claims settlement function - - - 1,707
--------- --------- --------- ---------
Total operating expenses 47,932 43,449 141,859 122,442
--------- --------- --------- ---------
Operating income 3,717 4,599 10,667 16,444
Interest expense (412) (61) (793) (126)
Other income, net 175 172 403 634
--------- --------- --------- ---------
Income before income taxes 3,480 4,710 10,277 16,952
Income tax provision (2,099) (2,125) (4,836) (7,333)
--------- --------- --------- ---------
Income before equity losses 1,381 2,585 5,441 9,619
Equity in net losses of affiliates (814) (3,203) (5,810) (7,420)
Minority share in loss of subsidiaries 1 14 1 14
--------- --------- --------- ---------
Net income (loss) 568 (604) (368) 2,213
Dividends and accretion on mandatorily
redeemable preferred stock - 6 (2) (185)
--------- --------- --------- ---------
Net income (loss) applicable to common stock $ 568 $ (598) $ (370) $ 2,028
--------- --------- --------- ---------
--------- --------- --------- ---------
PER SHARE DATA
Income (loss) per common share - basic $ 0.03 $ (0.02) $ (0.02) $ 0.08
--------- --------- --------- ---------
--------- --------- --------- ---------
Income (loss) per common share - diluted $ 0.03 $ (0.02) $ (0.02) $ 0.08
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average shares outstanding:
Basic 22,429 24,998 23,172 24,833
Diluted 22,670 25,388 23,478 25,440
</TABLE>
The accompanying notes are an integral part of these
consolidated interim financial statements.
3
<PAGE>
CCC INFORMATION SERVICES GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM BALANCE SHEET
(IN THOUSANDS)
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------- -------------
(Unaudited)
ASSETS
<S> <C> <C>
Cash $ 1,045 $ 1,526
Accounts receivable (net of reserves of $4,288 (unaudited) and
$3,258 at September 30, 1999 and December 31, 1998, respectively) 27,825 23,212
Income taxes receivable 1,402 272
Other current assets 7,952 5,726
-------- --------
Total current assets 38,224 30,736
Property and equipment (net of accumulated depreciation
of $40,765 (unaudited) and $34,494 at September 30, 1999
and December 31, 1998, respectively) 17,148 14,951
Goodwill (net of accumulated amortization of $13,585 (unaudited) and
$11,845 at September 30, 1999 and December 31, 1998, respectively) 16,853 12,799
Deferred income taxes 6,286 7,371
Long-term investment in affiliates 3,865 9,843
Other assets 3,091 3,318
-------- --------
Total Assets $ 85,467 $ 79,018
-------- --------
-------- --------
LIABILITIES, MANDATORILY REDEEMABLE PREFERRED STOCK
AND STOCKHOLDERS' EQUITY
Accounts payable and accrued expenses $ 36,247 $ 23,128
Current portion of long-term debt 736 -
Deferred revenues 4,823 4,327
-------- --------
Total current liabilities 41,806 27,455
Long-term debt 26,539 11,000
Long-term deferred revenue 475 956
Other liabilities 3,047 3,611
Minority interest in consolidated companies 5 5
-------- --------
Total liabilities 71,872 43,027
-------- --------
Mandatorily redeemable preferred stock ($1.00 par value, 100,000 shares
authorized, 0 and 684 designated and outstanding at
September 30, 1999 (unaudited) and December 31, 1998, respectively) - 688
-------- --------
Common stock ($0.10 par value, 30,000,000 shares authorized for all periods
presented, 21,892,668 (unaudited) and 23,700,165 shares issued and
outstanding at September 30, 1999 and December 31, 1998, respectively) 2,537 2,510
Additional paid-in capital 98,106 95,573
Accumulated deficit (46,839) (46,469)
Accumulated other comprehensive income (17) (26)
Treasury stock, at cost ($0.10 par value, 3,607,115 and 1,521,925 shares in
treasury at September 30, 1999 (unaudited) and December 31, 1998, respectively) (40,192) (16,285)
-------- --------
Total stockholders' equity 13,595 35,303
-------- --------
Total Liabilities, Mandatorily Redeemable Preferred Stock and
Stockholders' Equity $ 85,467 $ 79,018
-------- --------
-------- --------
</TABLE>
The accompanying notes are an integral part of these
consolidated interim financial statements.
4
<PAGE>
CCC INFORMATION SERVICES GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
-----------------
SEPTEMBER 30,
-------------
1999 1998
-------- --------
<S> <C> <C>
Operating activities:
Net income (loss) $ (368) $ 2,213
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Equity in net losses of affiliates 5,810 7,420
Minority interest share of losses of subsidiaries - (14)
Depreciation and amortization of property and equipment 5,695 5,690
Amortization of goodwill 1,741 1,121
Deferred income taxes 1,154 433
Other, net 298 47
Changes in:
Accounts receivable, net (903) (9,340)
Other current assets (2,253) (1,656)
Other assets 327 271
Accounts payable and accrued expenses 10,411 2,920
Income taxes receivable (580) 1,520
Current portion of deferred revenues 496 -
Deferred revenues (481) (1,354)
Other liabilities (564) (397)
-------- --------
Net cash provided by operating activities 20,783 8,874
-------- --------
Investing activities:
Capital expenditures (7,430) (11,144)
Purchase of investment securities (1,484) (12,778)
Proceeds from the sale of investment securities 1,484 41,301
Investments (6,255) (24,797)
Other, net - (19)
-------- --------
Net cash used for investing activities (13,685) (7,437)
-------- --------
Financing activities:
Principal repayments on long-term debt (27,000) (5,092)
Proceeds from the issuance of long-term debt 42,000 5,000
Proceeds from exercise of stock options 1,398 1,128
Proceeds from employee stock purchase plan 588 428
Payments to acquire treasury stock (24,035) (3,056)
Issuance of treasury stock 152 -
Redemption of preferred stock, including accrued dividends (690) -
Other, net 8 -
-------- --------
Net cash used for financing activities (7,579) (1,592)
-------- --------
Net decrease in cash (481) (155)
Cash:
Beginning of period 1,526 2,064
-------- --------
End of period $ 1,045 $ 1,909
-------- --------
-------- --------
SUPPLEMENTAL DISCLOSURES:
Cash paid:
Interest $ (643) $ (78)
-------- --------
-------- --------
Income taxes, net of refunds $ (4,259) $ (5,373)
-------- --------
-------- --------
</TABLE>
The accompanying notes are an integral part of these
consolidated interim financial statements.
5
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF BUSINESS AND ORGANIZATION
CCC Information Services Group Inc. ("Company") (formerly known as
InfoVest Corporation), through its wholly owned subsidiary CCC Information
Services Inc., is a supplier of automobile claims information and processing
services, claims management software and communication services. The Company's
services and products enable automobile insurance company customers and
collision repair facility customers to improve efficiency, manage costs and
increase consumer satisfaction in the management of automobile claims and
restoration.
As of September 30, 1999, White River Ventures Inc. ("White River")
held approximately 33.1% of the total outstanding common stock of the Company.
White River is a wholly owned subsidiary of White River Corporation. On June 30,
1998, White River Corporation, the sole shareholder of White River, was acquired
in a merger with Demeter Holdings Corporation, which is solely controlled by the
President and Fellows of Harvard College, a Massachusetts educational
corporation and title-holding company for the endowment fund of Harvard
University. Charlesbank Capital Partners LLC is acting as investment manager
with respect to the investment of White River in the Company. On June 16, 1999,
and in accordance with the terms of the Company's Mandatorily Redeemable Series
D and Series E Preferred Stock, all outstanding shares of the Company's
preferred stock were redeemed. Following the redemption of the Company's Series
E Preferred Stock, White River no longer has certain voting rights that entitle
it to have 51% of the votes cast on any matter to be voted upon by holders of
the Company's common stock.
NOTE 2 - CONSOLIDATED INTERIM FINANCIAL STATEMENTS
BASIS OF PRESENTATION
The accompanying consolidated interim financial statements as of and
for the three and nine months ended September 30, 1999 and 1998 are unaudited.
The Company is of the opinion that all material adjustments, consisting only of
normal recurring adjustments, necessary for a fair presentation of the Company's
interim results of operations and financial condition have been included. The
results of operations for any interim period should not be regarded as
necessarily indicative of results of operations for any future period. These
consolidated interim financial statements should be read in conjunction with the
Company's 1998 Annual Report on Form 10-K, as amended, filed with the Securities
and Exchange Commission.
PER SHARE INFORMATION
Earnings per share are based on the weighted average number of shares
of common stock outstanding and common stock equivalents using the treasury
method computed as follows:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
-------------------- ---------------------
1999 1998 1999 1998
------- ------- ------- --------
<S> <C> <C> <C> <C>
Weighted average common shares outstanding: 22,429 24,998 23,172 24,833
Shares attibutable to common stock outstanding 241 390 306 607
------- ------- ------- --------
Shares attibutable to common stock equivalents outstanding 22,670 25,388 23,478 25,440
------- ------- ------- --------
------- ------- ------- --------
</TABLE>
6
<PAGE>
NOTE 3 - OTHER COMPREHENSIVE INCOME (LOSS)
The Company's other comprehensive income (loss) includes foreign
currency translation adjustments. The Company's comprehensive income (loss) was
as follows:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
--------------------- ----------------------
1999 1998 1999 1998
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net income (loss) $ 568 $ (604) $ (368) $ 2,213
Foreign currency translation adjustments 67 (5) 9 (5)
------- ------- ------- -------
Comprehensive income (loss) $ 635 $ (609) $ (359) $ 2,208
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
NOTE 4 - NONCASH FINANCING ACTIVITIES
The Company directly charges its accumulated deficit account for
preferred stock accretion and preferred stock dividends accrued. These amounts
totaled $0.0 million and $0.2 million during the nine months ended September 30,
1999 and 1998, respectively.
In conjunction with the exercise of certain stock options, the Company
has reduced current income taxes payable with an offsetting credit to paid-in
capital for the tax benefit of stock options exercised. During the nine months
ended September 30, 1999 and 1998, these amounts totaled $0.5 million and $3.3
million, respectively.
NOTE 5 - LONG-TERM DEBT
Under terms included in the amended and restated credit facility
between the Company and its commercial bank, the Company's ability to borrow
under the revolving line of credit was increased from $50 million to $100
million on February 10, 1999. The line of credit commitment is reduced by $10
million on October 31, 2001, $15 million on October 31, 2003 and $75 million on
October 31, 2003. The interest rate under the amended bank credit facility is
the London Interbank Offering Rate (LIBOR) plus 1.0% or the prime rate in effect
from time to time, as selected by the Company. The Company pays a commitment fee
of 0.25% on any unused portion of the revolving credit facility. When borrowings
are outstanding, interest payments are due quarterly.
Under the bank facility, the Company has limitations and restrictions
on its ability to make certain sales or transfers of assets, incur indebtedness
or encumbrances, and redeem or repurchase its capital stock. In addition, the
bank credit facility requires the Company to maintain certain levels of
operating cash flow and debt coverage, and limits its ability to make
investments and declare dividends.
NOTE 6 - INVESTMENT IN INSURQUOTE
On February 10, 1998, the Company invested $20.0 million in InsurQuote
Systems, Inc. ("InsurQuote"). InsurQuote, formed in 1989, is a provider of
insurance rating information and the software tools used to manage that
information. The Company's $20.0 million investment included 19.9% of InsurQuote
common stock, an $8.9 million subordinated note, warrants, shares of Series C
redeemable convertible preferred stock and Series D convertible preferred stock.
The warrants provide the Company with the right to acquire additional shares of
InsurQuote common stock and are exercisable by the Company through February 10,
2008, subject to potential early termination provisions. The Series C preferred
stock is redeemable in full at the end of five years, or earlier under certain
conditions, if not converted prior to that time. Each share of Series C and D
preferred stock is initially convertible into one share of common stock at the
option of the Company. Under the terms of the investment agreement, the Company,
subject to certain conditions, can increase its investment through additional
purchases of common and preferred shares. The Company's ownership percentage,
assuming conversion into common stock all of the securities currently
exercisable, would increase to approximately 31.9% at September 30, 1999.
7
<PAGE>
The Company accounted for its investment in InsurQuote on the equity
method through March 31, 1999. Notwithstanding the Company's initial 19.9%
common stock equity share, the Company has recorded 100% of InsurQuote's net
losses for the period from the Company's initial investment, February 10, 1998
to March 31, 1999. The recording of 100% of InsurQuote's net losses was the
result of the Company's $20.0 million investment being InsurQuote's primary
source of funding for its operating losses. The Company has not recorded any
income tax benefit on the InsurQuote losses. At September 30, 1999, the
Company's remaining recorded investment in InsurQuote was approximately $3.7
million. The market value of the investment in InsurQuote at September 30, 1999
was not readily determinable.
On March 31, 1999, InsurQuote received a $20.0 million investment from
a new investor for convertible preferred stock with an 11% voting interest. As a
result of this new investment, the Company's ownership percentage decreased to
12.3% and the Company has ceased recording losses on its investment, unless it
is determined that its remaining investment is impaired.
Summary InsurQuote financial information for the nine months ended
September 30, 1999 was as follows:
<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
Revenues $ 7,709
----------
----------
Loss from operations $ (13,618)
----------
----------
Net loss $ (14,239)
----------
----------
</TABLE>
NOTE 7 - BUSINESS SEGMENTS
The Company has three reportable segments; Insurance Services,
Automotive Services and Consumer Processing Services. The Insurance Services
Division sells products and services which assist its customers in managing
total loss and repairable auto claims as well as a product to assist in the
underwriting of insurance. The Automotive Services Division sells products and
services which assist its customers in managing repairable auto claims. The
Consumer Processing Services Division sells products and services which provide
complete outsourcing services on many aspects of the claim process.
The Company's reportable segments are based upon the nature of the
products and services within the Company and the methods used to distribute
these products and services. The Company is organized into revenue producing
divisions and support organizations (product development and customer support)
tasked with facilitating the performance of the revenue producing divisions.
Division expenses represent principally salaries and related employee expenses
directly related to the Division's activities. Each revenue division and support
organization is led by a vice president that reports to either the Chief
Operating Officer or the Chief Executive Officer. Management evaluates
performance at the total company profit level and at the product revenue level.
The support organization costs are not currently allocated to the revenue
producing divisions and include product engineering, management information
systems, customer support and finance and administration costs.
8
<PAGE>
<TABLE>
<CAPTION>
CONSUMER
INSURANCE AUTOMOTIVE PROCESSING
SERVICES SERVICES SERVICES OTHER* TOTAL
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
NINE MONTHS ENDED SEPTEMBER 30, 1999
Net revenue $ 76,793 $ 50,010 $ 25,723 $ - $ 152,526
Expenses (22,631) (27,136) (23,530) (68,562) (141,859)
--------- --------- --------- --------- ---------
Operating income 54,162 22,874 2,193 (68,562) 10,667
Equity in losses of affiliates (5,810) -- -- -- (5,810)
--------- --------- --------- --------- ---------
Division operating margin $ 48,352 $ 22,874 $ 2,193 $ (68,562) $ 4,857
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
BALANCE AT SEPTEMBER 30, 1999
Accounts receivable, net $ 13,599 $ 420 $ 13,629 $ 177 $ 27,825
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
NINE MONTHS ENDED SEPTEMBER 30, 1998
Net revenue $ 76,287 $ 46,779 $ 15,101 $ 719 $ 138,886
Expenses (22,988) (25,380) (13,913) (60,161) (122,442)
--------- --------- --------- --------- ---------
Operating income 53,299 21,399 1,188 (59,442) 16,444
Equity in losses of affiliates (7,420) -- -- - (7,420)
--------- --------- --------- --------- ---------
Division operating margin $ 45,879 $ 21,399 $ 1,188 $ (59,442) $ 9,024
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
BALANCE AT SEPTEMBER 30, 1998
Accounts receivable, net $ 14,769 $ 3,465 $ 9,672 $ 485 $ 28,391
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
</TABLE>
* Other net revenue includes a discontinued product which provided new
and used car pricing to consumers. Other expenses include product engineering,
management information systems, customer support and finance and administration
costs.
NOTE 8 - LEGAL PROCEEDINGS
In March 1999, the Company completed a settlement of a lawsuit filed in
late 1998 involving a former independent sales representative. The settlement of
$1.7 million, recorded in December 1998, included, among other things, payment
for past earned commissions, resolution of disputed commissions, and other costs
associated with the resolution of the dispute.
The Company is a party to various claims and routine litigation arising
in the normal course of business. Such claims and litigation are not expected to
have a material adverse effect on the financial condition or results of
operations of the Company.
NOTE 9 - ACQUISITION
On August 13, 1999, the Company acquired 100% of the outstanding stock
of D.W. Norris Limited ("D.W. Norris") for $5.2 million. D.W. Norris provides
vehicle accident damage assessment, accident investigation, theft investigation
and other third-party insurance services throughout the United Kingdom. The
purchase agreement provides for the payment of a contingent purchase price, not
to exceed approximately $3 million, in the event that D.W. Norris meets certain
performance measures through December 2002.
9
<PAGE>
NOTE 10 - SUBSEQUENT EVENT
On October 13, 1999, the Company acquired certain assets of
Fleming and Hall Administrators for a purchase price of $0.3 million. Fleming
and Hall Administrators provides third-party administration to the auto
insurance industry in the southeastern United States. The purchase agreement
provides for the payment of a contingent purchase price, not to exceed
approximately $1.4 million, in the event that Fleming and Hall meets certain
performance measures through December 2004.
10
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED WITH THREE MONTHS ENDED
SEPTEMBER 30, 1998
The Company reported net income applicable to common stock of $0.6
million, or $0.03 per share on a diluted basis, for the three months ended
September 30, 1999, versus a net loss of $0.6 million, or $(0.02) per share on a
diluted basis, for the same quarter last year.
REVENUES. Third quarter 1999 revenues of $51.6 million were $3.6
million, or 7.5%, higher than the same quarter last year. The increase in
revenues was primarily due to continued growth in the Consumer Processing
Services Division, including the growth of international business.
PRODUCTION AND CUSTOMER SUPPORT. Production and customer support
increased from $12.9 million, or 26.8% of revenues, to $16.6 million, or 32.1%
of revenues. The increase in dollars and percentage of revenue was attributable
primarily to an increase in production and customer support capacity related to
Consumer Processing Services Division.
COMMISSION, ROYALTIES AND LICENSES. Commission, royalties and licenses
decreased from $5.5 million, or 11.5% of revenues, to $3.9 million, or 7.5% of
revenues. The decrease in dollars and as a percentage of revenue was due
primarily to the conversion of Automotive Services outside sales representatives
to salaried employees.
SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and
administrative increased from $16.0 million, or 33.3% of revenues, to $19.4
million, or 37.6% of revenues. The increase in dollars was due primarily to
consulting costs for projects aimed at improving the customer service
infrastructure and telecommunications and conversion of Automotive Services
outside sales representatives to salaried employees.
DEPRECIATION AND AMORTIZATION. Depreciation and amortization increased
from $2.4 million, or 5.0% of revenues, to $2.6 million, or 5.0% of revenues.
The increase in dollars was mainly the result of an increase in goodwill
amortization resulting from acquisitions and an increase in amortization of new
customer relationship management software.
PRODUCT DEVELOPMENT AND PROGRAMMING. Product development and
programming decreased from $6.6 million, or 13.8% of revenues, to $5.5 million,
or 10.6% of revenues. The dollar amount and percentage of revenue decreases were
due primarily to the Company's development efforts on international products
being reimbursed monthly by the Enterstand Joint Venture in Europe which was
established in the fourth quarter of 1998.
OTHER INCOME/INTEREST EXPENSE. Net other income/interest expense
decreased from $0.1 million to $(0.2) million. The decrease was principally the
result of higher interest expense due to borrowing under the revolving credit
facility in 1999.
INCOME TAXES. Third quarter income taxes were $2.1 million for both
1999 and 1998, or 45.1% and 60.3% of income before taxes for the third quarter
of 1999 and 1998, respectively. The increase in the 1999 effective tax rate
reflected an adjustment to the year-to-date provision driven mainly from lower
than anticipated results in the quarter.
EQUITY IN NET LOSSES OF AFFILIATES. Equity in net losses of affiliates
decreased from $3.2 million to $0.8 million. The results included $3.2 million
loss in InsurQuote for third quarter 1998 and $0.8 million loss from the
Enterstand Joint Venture, in third quarter of 1999. The Company ceased recording
equity in net losses of InsurQuote in the second quarter of 1999 as a result of
a new investor in InsurQuote.
11
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
NINE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED WITH NINE MONTHS ENDED
SEPTEMBER 30, 1998
The Company reported a net loss applicable to common stock of $0.4
million, or $(0.02) per share on a diluted basis, for the nine months ended
September 30, 1999, versus net income of $2.0 million, or $0.08 per share on a
diluted basis, for the same period last year.
REVENUES. Revenues of $152.5 million were $13.6 million, or 9.8%,
higher than the same period last year. The increase in revenues was primarily
due to continued growth in the Consumer Processing Services Division, including
the growth of international business, and an increase revenues from the
Automotive Services Division. The Automotive Services Division increase was a
result of growth in the digital imaging product and Pathways conversion fees.
PRODUCTION AND CUSTOMER SUPPORT. Production and customer support
increased from $33.6 million, or 24.2% of revenues, to $45.7 million, or 30.0%
of revenues. The increase in dollars and percentage of revenue was attributable
primarily to an increase in production and customer support capacity related to
Consumer Processing Services and Automotive Services.
COMMISSION, ROYALTIES AND LICENSES. Commission, royalties and licenses
decreased from $16.4 million, or 11.9% of revenues, to $12.7 million, or 8.4% of
revenues. The decrease in dollars and as a percentage of revenue was due
primarily to the conversion of Automotive Services outside sales representatives
to salaried employees.
SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and
administrative increased from $44.2 million, or 31.8% of revenues, to $58.5
million, or 38.3% of revenues. The increase in dollars was due primarily to a
compensation charge of $1.2 million as a result of a stock repurchase from a
charitable trust funded by the Company's chairman, David M. Phillips; consulting
costs for projects aimed at improving the internal telecommunications and
customer service infrastructure and reorganization costs of the Automotive
Services division. The Automotive Services division reorganization costs include
severance costs and conversion costs of outside sales representatives to
salaried employees.
DEPRECIATION AND AMORTIZATION. Depreciation and amortization increased
from $6.8 million, or 4.9% of revenues, to $7.5 million, or 4.9% of revenues.
The increase in dollars was mainly the result of an increase in goodwill
amortization resulting from acquisitions and an increase in amortization of new
customer relationship management software.
PRODUCT DEVELOPMENT AND PROGRAMMING. Product development and
programming decreased from $19.7 million, or 14.2% of revenues, to $17.5
million, or 11.4% of revenues. The dollar and percentage of revenue decreases
were due primarily to the Company's development efforts on international
products being reimbursed monthly by the Enterstand Joint Venture in Europe.
RELOCATION OF CLAIMS SETTLEMENT FUNCTION. In the second quarter of
1998, the Company recorded a charge of $1.7 million related to the relocation of
certain customer service and claims processing operations to South Dakota.
OTHER INCOME/INTEREST EXPENSE. Net other income/interest expense
decreased from $0.5 million to $(0.4) million. The decrease was principally the
result of higher interest expense due to borrowing under the revolving credit
facility in 1999 and lower interest income from the investment of excess cash in
1999.
INCOME TAXES. Income taxes decreased from $7.3 million, or 43.3% of
income before taxes, to $4.8 million, or 47.1% of income before taxes. The
dollar decrease and the rate increase were mainly attributable to lower pretax
income.
EQUITY IN NET LOSSES OF AFFILIATES. Equity in net losses of affiliates
decreased from $7.4 million to $5.8 million. The results included $4.2 million
and $7.4 million in losses in InsurQuote for 1999 and 1998, respectively, and
$1.6 million loss from the Enterstand Joint Venture, in 1999. The Company ceased
recording equity in net losses of InsurQuote in the second quarter of 1999 as a
result of a new investor in InsurQuote.
12
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
YEAR 2000 ISSUE
BACKGROUND. Some computers, software and other equipment include
programming code in which calendar year data is abbreviated to only two digits.
As a result of this design decision, some of these systems could fail to operate
or fail to produce correct results if "00" is interpreted to mean 1900, rather
than 2000 ("Year 2000 Problem"). These problems are widely expected to increase
in frequency and severity as the year 2000 approaches. The Company defines an
application to be Year 2000 compliant if it can accurately process date data
(including calculating, comparing and sequencing) from, into and between 1999
and 2000, including leap year calculations.
ASSESSMENT. The Year 2000 Problem could affect computers, software, and
other equipment used, operated, or maintained by the Company. Accordingly, the
Company is reviewing its internal computer programs and systems to ensure that
the programs and systems will be Year 2000 compliant. The Company presently
believes that its computer systems will be Year 2000 compliant in a timely
manner. However, while the estimated cost of these efforts are not expected to
be material to the Company's financial position or any year's results of
operations, there can be no assurance to this effect.
SOFTWARE SOLD TO CUSTOMERS. The Company believes that it has
substantially identified all potential Year 2000 Problems with any of the
software products, which it develops and markets. As a key supplier to
insurance companies and collision repair facilities, the Company has
identified a significant exposure for Year 2000 problems regarding the effect
of its legacy collision estimating software on some customers' ability to
complete an estimate. The Company has converted almost all of those customers
impacted to the Year 2000 compliant version of the software. The remaining
customers will be converted early in the fourth quarter of 1999. While lost
revenues from such an event are a concern for the Company, the greater risks
are the monetary damages for which the Company could be liable if it in fact
is found responsible for the shutdown of one of its customer's facilities.
Such a finding could have a material adverse impact on the Company's results
of operations.
INTERNAL INFRASTRUCTURE. The Company believes that it has identified
substantially all of the major computers, software applications, and related
equipment used in connection with its internal operations that must be modified,
upgraded or replaced to minimize the possibility of a material disruption to its
business. The Company has modified, upgraded, and replaced substantially all
major systems that have been identified as adversely affected. The remaining
systems will be compliant in the fourth quarter of 1999.
SYSTEMS OTHER THAN INFORMATION TECHNOLOGY SYSTEMS. In addition to
computers and related systems, the operation of office and facilities equipment,
such as fax machines, photocopiers, telephone switches, security systems,
elevators, and other common devices may be affected by the Year 2000 Problem.
The Company has nearly completed its assessment of its facility and office
equipment. A majority of this equipment is now compliant, with the remaining
items to be completed in the fourth quarter of 1999.
The Company estimates the total cost to the Company of completing any
required modifications, upgrades, or replacements of these internal systems will
not have a material adverse effect on the Company's business or results of
operations. Currently, the Company is expensing approximately $0.6 million per
quarter associated with this effort. It is expected that this cost will continue
through the fourth quarter of 1999. This estimate is being monitored and will be
revised as additional information becomes available.
SUPPLIERS. The Company has substantially completed communications with
third party suppliers of the major computers, software, and other equipment
used, operated, or maintained by the Company to identify and, to the extent
possible, to resolve issues involving the Year 2000 Problem. However, the
Company has limited or no control over the actions of these third party
suppliers. Thus, while the Company expects that it will be able to resolve any
significant Year 2000 Problems with these systems, there can be no assurance
that these suppliers will resolve any or all Year 2000 Problems with these
systems before the occurrence of a material disruption to the business of the
Company or any of its customers. Any failure of these third parties to resolve
Year 2000 Problems with their systems in a timely manner could have a material
adverse effect on the Company's business, financial condition, and results of
operation.
MOST LIKELY CONSEQUENCES OF YEAR 2000 PROBLEMS. The Company expects to
identify and resolve all Year 2000 Problems that could materially adversely
affect its business operations. However, management believes that it is not
possible to determine with complete certainty that all Year 2000 Problems
affecting the Company have been identified or corrected. The number of devices
that could be affected and the interactions
13
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
among these devices are simply too numerous. In addition, one cannot accurately
predict how many Year 2000 Problem-related failures will occur or the severity,
duration, or financial consequences of these perhaps inevitable failures. As a
result, management expects that the Company could likely suffer the following
consequences:
1. a significant number of operational inconveniences and inefficiencies
for the Company and its customers that may divert management's time
and attention and financial and human resources from its ordinary
business activities; and
2. a lesser number of serious failures that may require significant
efforts by the Company or its customers to prevent or alleviate
material business disruptions.
Although the Company believes its critical customer systems and
critical internal system are compliant, there is no guarantee of these results.
Specific factors that give rise to this uncertainty include a possible loss of
technical resources to perform the work, failure to identify all susceptible
systems, non-compliance by third parties whose systems and operations impact the
Company, and other similar uncertainties. A possible worst case scenario might
include one or more of the Company's software products sold to customers being
non-compliant. Such an event could result in a material disruption to the
Company's or customers operations. For example, the software could experience an
interruption in its ability to properly calculate or access the data required to
complete a collision estimate. Should the worst case scenario occur it could,
depending on its duration, have a material impact on the Company's results of
operations and financial position.
CONTINGENCY PLANS. The Company has completed a significant portion of
its contingency plans to address Year 2000 Problems should they occur. The
Company expects to finalize its contingency plans in the fourth quarter of 1999.
Depending on the systems affected, these plans could include accelerated
replacement of affected equipment or software, short to medium use of backup
equipment and software, increased work hours for Company personnel or use of
contract personnel to correct on an accelerated schedule any Year 2000 Problems
that arise or to provide manual workarounds for information systems, and similar
approaches. If the Company is required to implement any of these contingency
plans, it could have a material adverse effect on the Company's financial
condition and results of operations.
Based on the activities described above, management believes the
Company is devoting the necessary resources to identify and resolve Year 2000
Problems. The success of this effort and a favorable outcome to the various
potential situations described herein will determine the impact the Year 2000
Problem has on the Company's business or results of operations.
LIQUIDITY AND CAPITAL RESOURCES
During the nine months ended September 30, 1999, net cash provided by
operating activities was $20.8 million. The Company applied $7.4 million to the
purchase of equipment and software. In addition, the Company borrowed $15.0
million of long-term debt. The Company also acquired 2.1 million of the its
outstanding shares for $24.0 million during the nine months ended September 30,
1999. On August 13, 1999, the Company acquired 100% of the outstanding stock of
D.W. Norris Limited for $5.2 million. On October 13, 1999, the Company acquired
certain assets of Fleming and Hall Administrators for approximately $0.3
million.
Management believes that cash flows from operations and the Company's
credit facility will be sufficient to meet the Company's liquidity needs over
the next 12 months. There can be no assurance, however, that the Company will be
able to satisfy its liquidity needs in the future without engaging in financing
activities beyond that described above.
FORWARD-LOOKING STATEMENTS
The Private Securities Litigation Reform Act of 1995 contains certain
safe harbors regarding forward-looking statements. In that context, the
discussion in Item 2 contains forward-looking statements which involves certain
degrees of risks and uncertainties, including statements relating to liquidity
and capital resources. Except for the historical information, the risks and
uncertainties, include, without limitation, the effect of competitive pricing
within the industry, the presence of competitors with greater
14
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
financial resources than the Company, the intense competition for top software
engineering talent and the volatile nature of technological change within the
automobile claims industry. Additional factors that could affect the Company's
financial condition and results of operations are included in the Company's
Initial Public Offering Prospectus and Registration on Form S-1 filed with the
Securities and Exchange Commission ("Commission") on August 16, 1996 and the
Company's 1998 Annual Report on Form 10-K, as amended, filed with the Commission
on April 1, 1999.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In March 1999, the Company completed a settlement of a lawsuit filed in
late 1998 involving a former independent sales representative. The settlement of
$1.7 million, recorded in December 1998, included, among other things, payment
for past earned commissions, resolution of disputed commissions, and other costs
associated with the resolution of the dispute.
The Company is a party to various claims and routine litigation arising
in the normal course of business. Such claims and litigation are not expected to
have a material adverse effect on the financial condition or results of
operations of the Company.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3.1 Amended and Restated Certificate of Incorporation of the
Company filed as Exhibit 3.1 of the Company's Annual Report
on Form 10-K (the "Annual Report") (filed with the
Commission File No. 000-28600 on March 14, 1997, and hereby
incorporated by reference)
3.2 Amended and Restated Bylaws (incorporated herein by
reference to Exhibit 3.2 of the Company's Annual Report on
Form 10-K, Commission File No. 000-28600)
10.1 Amended and restated Credit Facility Agreement between CCC
Information Services Inc., LaSalle National Bank and the
other financial institutions party thereto (incorporated
herein by reference to Exhibit 10.1 of the Company's Annual
Report on Form 10-K, Commission File No. 000-28600)
10.2 Amended and restated Motors Crash Estimating Guide Data
License (incorporated herein by reference to Exhibit 10.2 of
the Company's Annual Report on Form 10-K, Commission File
No. 000-28600)
10.3 European Version of Motors Crash Estimating Guide Data
License (incorporated herein by reference to Exhibit 10.3 of
the Company's Annual Report on Form 10-K, Commission File
No. 000-28600)
15
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
10.4 Stock Option Plan (incorporated herein by reference to
Exhibit 4.03 of the Company's Registration Statement on Form
S-8, Commission File No. 333-15207 filed October 31, 1996)
10.5 1997 Stock Option Plan, as amended (incorporated herein by
reference to Exhibit 4.05 of the Company's Registration
Statement on Form S-8, Commission File No. 333-67645 filed
November 20, 1998)
10.6 401(k) Company Retirement Saving & Investment Plan
(incorporated herein by reference to Exhibit 4.4 of the
Company's Registration Statement on Form S-8, Commission
File No. 333-32139 filed on July 25, 1997)
10.7 Employee Stock Purchase Plan (incorporated herein by
reference to Exhibit 5.01 of the Company's Registration
Statement on Form S-8, Commission File No. 333-47205 filed
on March 2, 1998)
10.8 Securities Purchase Agreement between Company and InsurQuote
Systems Inc. dated February 10, 1998 (incorporated herein by
reference to Exhibit 10.7 of the Company's Quarterly Report
on Form 10-Q, Commission File No. 000-28600 filed on May 15,
1999)
10.9 Investment Agreement between Company and InsurQuote Systems
Inc. dated February 10, 1998 (incorporated herein by
reference to Exhibit 10.8 of the Company's Quarterly Report
on Form 10-Q, Commission File No. 000-28600 filed on May 15,
1999)
10.10 Common Stock Warrant to purchase 440,350 shares of
InsurQuote Systems Inc. dated February 10, 1998
(incorporated herein by reference to Exhibit 10.9 of the
Company's Quarterly Report on Form 10-Q, Commission File No.
000-28600 filed on May 15, 1999)
10.11 Sale and Purchase Agreement between the Company and Phillip
Carter dated July 1, 1998 (incorporated herein by reference
to Exhibit 10.11 of the Company's Annual Report on Form
10-K, Commission File No. 000-28600)
11 Statement Re: Computation of Per Share Earnings
13 InsurQuote Systems, Inc. Audited Consolidated Financial
Statements for the Year Ended June 30, 1998 (incorporated
herein by reference to Exhibit 13 of the Company's Annual
Report on Form 10-K, Commission File No. 000-28600)
27 Financial Data Schedule
(b) Reports on Form 8-K
None
16
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
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.
Date: November 9, 1999 CCC Information Services Group Inc.
By: /s/ Githesh Ramamurthy
----------------------
Name: Githesh Ramamurthy
Title: President and Chief Executive Officer
By: /s/ Reid E. Simpson
-------------------
Name: Reid E. Simpson
Title: Executive Vice President
and Chief Financial Officer
By: /s/ Michael P. Devereux
-----------------------
Name: Michael P. Devereux
Title: Senior Vice President of Finance
and Chief Accounting Officer
17
<PAGE>
CCC INFORMATION SERVICES GROUP INC.
AND SUBSIDIARIES
EXHIBIT INDEX
3.1 Amended and Restated Certificate of Incorporation of the Company filed as
Exhibit 3.1 of the Company's Annual Report on Form 10-K (the "Annual
Report") (filed with the Commission File No. 000-28600 on March 14, 1997,
and hereby incorporated by reference)
3.2 Amended and Restated Bylaws (incorporated herein by reference to Exhibit
3.2 of the Company's Annual Report on Form 10-K, Commission File No.
000-28600)
10.1 Amended and restated Credit Facility Agreement between CCC Information
Services Inc., LaSalle National Bank and the other financial institutions
party thereto (incorporated herein by reference to Exhibit 10.1 of the
Company's Annual Report on Form 10-K, Commission File No. 000-28600)
10.2 Amended and restated Motors Crash Estimating Guide Data License
(incorporated herein by reference to Exhibit 10.2 of the Company's Annual
Report on Form 10-K, Commission File No. 000-28600)
10.3 European Version of Motors Crash Estimating Guide Data License
(incorporated herein by reference to Exhibit 10.3 of the Company's Annual
Report on Form 10-K, Commission File No. 000-28600)
10.4 Stock Option Plan (incorporated herein by reference to Exhibit 4.03 of
the Company's Registration Statement on Form S-8, Commission File No.
333-15207 filed October 31, 1996)
10.5 1997 Stock Option Plan, as amended (incorporated herein by reference to
Exhibit 4.05 of the Company's Registration Statement on Form S-8,
Commission File No. 333-67645 filed November 20, 1998)
10.6 401(k) Company Retirement Saving & Investment Plan (incorporated herein
by reference to Exhibit 4.4 of the Company's Registration Statement on
Form S-8, Commission File No. 333-32139 filed on July 25, 1997)
10.7 Employee Stock Purchase Plan (incorporated herein by reference to Exhibit
5.01 of the Company's Registration Statement on Form S-8, Commission File
No. 333-47205 filed on March 2, 1998)
10.8 Securities Purchase Agreement between Company and InsurQuote Systems Inc.
dated February 10, 1998 (incorporated herein by reference to Exhibit 10.7
of the Company's Quarterly Report on Form 10-Q, Commission File No.
000-28600 filed on May 15, 1999)
10.9 Investment Agreement between Company and InsurQuote Systems Inc. dated
February 10, 1998 (incorporated herein by reference to Exhibit 10.8 of
the Company's Quarterly Report on Form 10-Q, Commission File No.
000-28600 filed on May 15, 1999)
10.10 Common Stock Warrant to purchase 440,350 shares of InsurQuote Systems
Inc. dated February 10, 1998 (incorporated herein by reference to Exhibit
10.9 of the Company's Quarterly Report on Form 10-Q, Commission File No.
000-28600 filed on May 15, 1999)
10.11 Sale and Purchase Agreement between the Company and Phillip Carter dated
July 1, 1998 (incorporated herein by reference to Exhibit 10.11 of the
Company's Annual Report on Form 10-K, Commission File No. 000-28600)
11 Statement Re: Computation of Per Share Earnings
13 InsurQuote Systems, Inc. Audited Consolidated Financial Statements for
the Year Ended June 30, 1998 (incorporated herein by reference to Exhibit
13 of the Company's Annual Report on Form 10-K, Commission File No.
000-28600)
27 Financial Data Schedule
18
<PAGE>
CCC INFORMATION SERVICES GROUP INC. AND SUBSIDIARIES
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
------------------ -----------------
SEPTEMBER 30, SEPTEMBER 30,
------------- -------------
1999 1998 1999 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Per share income (loss) before dividends and accretion on preferred stock:
Income (loss) before dividends and accretion on preferred stock $ 568 $ (604) $ (368) $ 2,213
-------- -------- -------- --------
-------- -------- -------- --------
Weighted average common shares outstanding:
Shares attributable to common stock outstanding 22,429 24,998 23,172 24,833
Shares attributable to common stock equivalents outstanding 241 390 306 607
-------- -------- -------- --------
22,670 25,388 23,478 25,440
-------- -------- -------- --------
-------- -------- -------- --------
Per share income (loss) before dividends and accretion on preferred stock $ 0.03 $ (0.02) $ (0.02) $ 0.08
-------- -------- -------- --------
-------- -------- -------- --------
Per share dividends and accretion on mandatorily redeemable preferred:
Dividends and accretion on mandatorily redeemable preferred: $ - $ 6 $ (2) $ (185)
-------- -------- -------- --------
-------- -------- -------- --------
Weighted average common shares outstanding:
Shares attributable to common stock outstanding 22,429 24,998 23,172 24,833
Shares attributable to common stock equivalents outstanding 241 390 306 607
-------- -------- -------- --------
22,670 25,388 23,478 25,440
-------- -------- -------- --------
-------- -------- -------- --------
Per share dividends and accretion on mandatorily redeemable preferred $ - $ - $ - $ -
-------- -------- -------- --------
-------- -------- -------- --------
Net income (loss) per share applicable to common stock:
Net income (loss) applicable to common stock $ 568 $ (598) $ (370) $ 2,028
-------- -------- -------- --------
-------- -------- -------- --------
Weighted average common shares outstanding:
Shares attributable to common stock outstanding 22,429 24,998 23,172 24,833
Shares attributable to common stock equivalents outstanding 241 390 306 607
-------- -------- -------- --------
22,670 25,388 23,478 25,440
-------- -------- -------- --------
-------- -------- -------- --------
Net income (loss) per share applicable to common stock $ 0.03 $ (0.02) $ (0.02) $ 0.08
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS AS OF AND FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH CONSOLIDATED INTERIM FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,045
<SECURITIES> 0
<RECEIVABLES> 32,113
<ALLOWANCES> (4,288)
<INVENTORY> 0
<CURRENT-ASSETS> 38,224
<PP&E> 57,913
<DEPRECIATION> (40,765)
<TOTAL-ASSETS> 85,467
<CURRENT-LIABILITIES> 41,806
<BONDS> 0
0
0
<COMMON> 60,451
<OTHER-SE> (46,856)<F1>
<TOTAL-LIABILITY-AND-EQUITY> 85,467
<SALES> 0
<TOTAL-REVENUES> 152,526
<CGS> 0
<TOTAL-COSTS> 141,859
<OTHER-EXPENSES> 403<F2>
<LOSS-PROVISION> 2,394
<INTEREST-EXPENSE> (793)
<INCOME-PRETAX> 10,277
<INCOME-TAX> 4,836
<INCOME-CONTINUING> (368)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (368)<F3>
<EPS-BASIC> (0.02)
<EPS-DILUTED> (0.02)<F4>
<FN>
<F1>ACCUMULATED DEFICIT & CUMULATIVE TRANSLATION ADJUSTMENT.
<F2>OTHER INCOME, NET OF EXPENSES.
<F3>NET LOSS
<F4>INCLUDES DIVIDENDS AND ACCRETION ON MANDATORILY REDEEMABLE PREFERRED STOCK.
</FN>
</TABLE>
