<PAGE>
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, 1997.
[ ] 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 000-23273
----------
BRIGHT HORIZONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 04-3390321
-------- ----------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
One Kendall Square, Building 200
Cambridge, Massachusetts 02139
(Address of principal executive offices)
(617) 577-8020
(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 [ ].
Indicate the number of shares outstanding of each of the registrant's classes of
common stock as of the latest practicable date: 5,511,743 shares of common
stock, $.01 par value, at November 7, 1997.
<PAGE>
BRIGHT HORIZONS, INC.
FORM 10-Q
INDEX
Page
Number
------
PART I. FINANCIAL INFORMATION
ITEM 1. Consolidated Financial Statements
A. Consolidated Balance Sheet at
September 30, 1997 (Unaudited) and June 30, 1997 3
B. Consolidated Statement of Income
Three months ended September 30, 1997 and
September 30, 1996 (Unaudited) 5
C. Consolidated Statement of Cash Flows
Three Months ended September 30, 1997 and
September 30, 1996 (Unaudited) 6
D. Notes to Consolidated Financial Statements (Unaudited) 7
ITEM 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings 13
ITEM 2. Changes in Securities 13
ITEM 3. Defaults Upon Senior Securities 13
ITEM 4. Submission of Matters to a Vote
of Security Holders 13
ITEM 5. Other information 13
ITEM 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 13
-2-
<PAGE>
BRIGHT HORIZONS, INC.
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
SEPTEMBER 30, JUNE 30,
ASSETS 1997 1997
------------- -----------
(UNAUDITED)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 4,547,007 $ 6,059,349
Accounts receivable, trade, net of allowance for doubtful
accounts of $ 338,209 and $ 316,637 at September 30,
1997 and June 30, 1997, respectively 3,065,931 2,766,997
Prepaid and other current assets 2,294,140 1,253,008
Deferred income taxes 2,753,000 2,753,000
----------- -----------
Total current assets 12,660,078 12,832,354
Fixed assets, net 14,479,046 11,250,311
Deferred charges, net 353,924 315,227
Goodwill, net 4,004,624 1,321,611
Other intangible assets, net 1,041,338 1,121,649
Other assets 375,965 386,476
Deferred income taxes 1,454,000 1,291,000
----------- -----------
Total assets $34,368,975 $28,518,628
=========== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
-3-
<PAGE>
BRIGHT HORIZONS, INC.
CONSOLIDATED BALANCE SHEET (continued)
LIABILITIES, MANDATORILY REDEEMABLE CONVERTIBLE PREFERRED STOCK, REDEEMABLE
COMMON STOCK AND STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
SEPTEMBER 30, JUNE 30,
1997 1997
------------- -------------
(UNAUDITED)
<S> <C> <C>
Current liabilities:
Current portion of long-term debt and obligations
under capital leases $ 876,546 $ 834,481
Accounts payable and accrued expenses 9,901,572 7,282,694
Income taxes payable 197,780 41,214
Other current liabilities 490,344 490,344
Deferred revenue 4,940,348 4,096,336
----------- -----------
Total current liabilities 16,406,590 12,745,069
Long-term debt and obligations under capital leases 3,861,758 3,440,132
Accrued rent 1,549,457 1,540,886
Other long-term liabilities 1,095,392 1,005,880
Deferred revenue 2,008,051 1,241,666
----------- -----------
24,921,248 19,973,633
----------- -----------
Mandatorily redeemable convertible preferred stock,
$.01 par value; 1,860,330 shares authorized, issued
and outstanding at September 30, 1997 and June 30,
1997, respectively, at issuance cost plus accumulated
dividends of 9,104,787 and $8,830,679, respectively 19,979,068 19,704,960
----------- -----------
Redeemable common stock, $.01 par value; 108,333 shares
outstanding at September 30, 1997, at issuance cost
plus accumulated accretion of $ 74,184 642,934 --
----------- -----------
Stockholders' equity (deficit):
Common stock, $.01 par value, 15,000,000
shares authorized, 580,546 and 556,732
shares issued and outstanding at September 30, 1997
and June 30, 1997, respectively 5,805 5,567
Additional paid-in capital 85,703 65,986
Accumulated deficit ( 11,265,783) ( 11,231,518)
----------- -----------
Total stockholders' equity (deficit) ( 11,174,275) ( 11,159,965)
----------- -----------
Total liabilities and stockholders' equity
(deficit) $34,368,975 $28,518,628
=========== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
-4-
<PAGE>
BRIGHT HORIZONS, INC.
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
SEPTEMBER 30,
--------------------------
1997 1996
----------- -----------
<S> <C> <C>
Net revenues $24,168,057 $19,712,864
Cost of services 20,818,731 17,215,042
----------- -----------
Gross profit 3,349,326 2,497,822
Selling, general and administrative expenses 2,666,927 2,048,372
Amortization of non-compete agreements 70,001 140,001
----------- -----------
Income from operations 612,398 309,449
Interest income 8,442 29,804
Interest expense ( 86,813) ( 98,280)
----------- -----------
Income before income taxes 534,027 240,973
Income tax provision ( 220,000) ( 98,558)
----------- -----------
Net income before preferred stock
dividends and accretion on
redeemable common stock 314,027 142,415
Preferred stock cumulative dividends
and accretion on redeemable
common stock ( 348,292) ( 274,556)
----------- -----------
Net loss applicable to common stockholders ( $34,265) ( $132,141)
----------- -----------
Unaudited pro forma data (Note 4):
Net income per share $0.07 $0.03
=========== ===========
Weighted average number of common
and common equivalent shares 4,605,673 4,575,075
=========== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
-5-
<PAGE>
BRIGHT HORIZONS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
Three months ended September 30,
--------------------------------
1997 1996
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 314,027 $ 142,415
Adjustments to reconcile net income to net cash provided
by operating activities, net of acquired amounts:
Depreciation and amortization 555,996 519,335
Loss on disposal of fixed assets 61,871 12,363
Changes in assets and liabilities:
Deferred income taxes ( 75,000) 97,000
Accounts receivable, trade ( 298,000) 175,164
Prepaid expenses and other current assets ( 793,966) ( 688,832)
Accounts payable and accrued expenses 1,905,231 1,651,321
Income taxes payable 156,566 ( 87,856)
Deferred revenue 1,553,781 125,096
Accrued rent ( 48,074) ( 32,548)
Other current and long-term liabilities 89,512 ( 564)
----------- -----------
Total adjustments 3,107,917 1,770,479
----------- -----------
Net cash provided by operating activities 3,421,944 1,912,894
----------- -----------
Cash flows from investing activities:
Additions to fixed assets, net of acquired amounts (3,439,554) ( 674,696)
Proceeds from disposal of fixed assets 43,016 26,231
Increase in deferred charges ( 53,884) -
(Increase) decrease in other assets 78,272 ( 27,387)
Payment for acquisition, net of acquired amounts ( 1,539,407) -
----------- -----------
Net cash used in investing activities ( 4,911,557) ( 675,852)
----------- -----------
Cash flows from financing activities:
Proceeds from issuance of common stock 19,956 2,258
Payments on line of credit - ( 500,000)
Principal payments of long-term debt and
obligations under capital leases ( 562,985) ( 64,217)
Borrowing of long-term debt and capital leases 520,300 82,516
----------- -----------
Net cash used in financing activities ( 22,729) ( 479,443)
----------- -----------
Net increase (decrease) in cash and cash equivalents ( 1,512,342) 757,599
Cash and cash equivalents, beginning of period 6,059,349 4,583,257
----------- -----------
Cash and cash equivalents, end of period $ 4,547,007 $5,340,856
=========== ===========
</TABLE>
The company purchased a child care management company during the three months
ended September 30, 1997. In connection with this acquisition, liabilities were
assumed as follows:
<TABLE>
<S> <C>
Fair value of assets acquired $ 3,441,438
Cash paid ( 1,539,407)
Redeemable common stock issued ( 568,750)
------------
Liabilities assumed, including notes payable $ 1,333,281
============
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
-6-
<PAGE>
BRIGHT HORIZONS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. The Company and Basis of Presentation
- -- -------------------------------------
The consolidated balance sheet as of September 30, 1997 and the consolidated
statements of income and cash flows for the three month periods ended September
30, 1997 and 1996 have been prepared by the Company in accordance with the
accounting policies described in its annual financial statements for the year
ended June 30, 1997, included in the Company's Registration Statement on Form
S-1, as amended (Registration Statement No. 333-14981), and should be read in
conjunction with the notes thereto.
In the opinion of the management of Bright Horizons, Inc. (the "Company"), the
accompanying unaudited consolidated financial statements contain all adjustments
(consisting of only normal, recurring accruals) which are necessary to present
fairly its financial position as of September 30, 1997 and the results of its
operations and cash flows for the three month periods ended September 30, 1997
and 1996. The results of operations for interim periods are not necessarily
indicative of the operating results to be expected for the full year.
2. Initial Public Offering of Common Stock
- -- ---------------------------------------
On November 13, 1997, the Company completed an initial public offering of
2,970,000 shares of its common stock, of which 1,350,000 shares were issued and
sold by the Company and 1,620,000 of which were sold by the Selling
Shareholders, at an offering price of $13.00 per share (the "Offering"). On
November 24, 1997, Selling Shareholders sold an additional 445,500 shares to
satisfy the underwriters' over allotment option. The Company received net
proceeds of approximately $15.9 million (after deducting underwriting discounts
and expenses). Approximately $4.0 million was used to repay outstanding debt.
The Company intends to use the balance of the net proceeds for working capital
and general corporate purposes, including the financing of potential
acquisitions and new centers currently under development.
In connection with the Offering, all outstanding shares of the Company's Series
A Mandatorily Redeemable Convertible Preferred Stock, Series B Mandatorily
Redeemable Convertible Preferred Stock, and Series C Mandatorily Redeemable
Convertible Preferred Stock (collectively, the "Convertible Preferred Stock")
were converted into an aggregate of 3,100,512 shares of Common Stock, and
outstanding warrants which otherwise would have expired upon the closing of the
offering were converted into 303,924 shares of Common Stock. Redeemable Common
Stock issued in connection with an acquisition (see Note 3) was also converted
to Common Stock in connection with the Offering. The accompanying consolidated
balance sheet does not reflect the preferred stock conversions, warrant
exercises or redeemable common stock conversions.
-7-
<PAGE>
Also in anticipation of the Offering, the Board of Directors authorized a
1-for-3 reverse stock split of the Company's common stock on October 8, 1997.
Accordingly, all shares of common stock, common stock options and warrants,
preferred stock conversion ratios and per share amounts included in the
accompanying financial statements have been adjusted to give retroactive
effect to the reverse split for all periods presented.
3. Acquisition
- -- -----------
On July 1, 1997, the Company acquired the business and substantially all the
assets and liabilities of Pacific Preschools, Inc. d.b.a. The Learning Garden, a
child care management company operating four child development centers in
Seattle, Washington, for approximately $1.6 million in cash and 108,333 shares
of redeemable common stock. The redemption feature of these shares terminated
upon the completion of the Company's initial public offering (see Note 2). The
purchase price has been allocated based on the estimated fair value of the
assets and liabilities acquired at the date of acquisition resulting in goodwill
of approximately $2.7 million which is being amortized over 25 years. The
acquisition was accounted for by the purchase method and, accordingly, the
operating results of the acquired company have been included from the date of
acquisition.
4. Unaudited Pro Forma Net Income Per Share
- -- ----------------------------------------
Pro forma net income per share is determined by dividing the net income before
preferred stock dividends and accretion on redeemable common stock by the
weighted average number of common and common equivalent shares outstanding
during the period, assuming (1) the conversion of all convertible preferred
stock, (2) the conversion of the redeemable common stock and (3) the exercise
of warrants issued in connection with the Series C redeemable convertible
preferred stock. Common stock equivalents (stock options and warrants) issued at
prices below the offering price per share during the twelve months preceding the
public offering of the Company's common stock have been included in the
calculation of unaudited pro forma net income per share using the treasury stock
method as if outstanding since the beginning of each period presented.
Statement of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS
128"), has been issued and is effective for fiscal periods ending after December
15, 1997. SFAS 128 establishes standards for computing and presenting earnings
per share. The Company is required to adopt the provisions of SFAS 128 in the
fourth quarter of its fiscal year ending June 30, 1998. Under the standards
established by SFAS 128, earnings per share is measured at two levels: basic
earnings per share and diluted earnings per share. Basic earnings per share is
computed by dividing net income by the weighted average number of common shares
outstanding during the year. Diluted earnings per share is computed by dividing
net income by the weighted average number of common shares after considering the
additional dilution related to preferred stock, convertible debt, options and
warrants.
-8-
<PAGE>
BRIGHT HORIZONS, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
When used in this discussion, the words "believes," "anticipated" and similar
expressions are intended to identify forward-looking statements. Although the
Company believes that the assumptions underlying the forward-looking statements
contained herein are reasonable, any of the assumptions could be inaccurate and
therefore, such statements are subject to certain risks and uncertainties which
could cause actual results in the future to differ materially from those
projected. See "Risk Factors" included in the Prospectus for the Company's
initial public offering and incorporated herein by reference for a description
of a number of risks and uncertainties which could affect actual results.
Readers are cautioned not to place undue reliance on these forward-looking
statements which speak only as of the date hereof. The Company undertakes no
obligation to publicly release the result of any revisions to these forward-
looking statements which may be made to reflect certain events or circumstances
after the date hereof or to reflect the occurrence of unanticipated events.
OVERVIEW
Bright Horizons operates the largest number of corporate-sponsored child
development centers in the United States, with 140 centers at September 30, 1997
providing care and education to more than 13,500 children and their families
(150 centers at November 30, 1997). The Company partners with corporate
sponsors to provide early childhood education, full and part-time child care,
emergency backup care, before and after school care for school age children,
summer camps, vacation and special event care, elementary school and other
family support services. Bright Horizons serves many of the nation's leading
corporations, including Allstate Insurance Company, Glaxo Wellcome, IBM (through
the American Business Collaborative), Merck & Co., Inc., Motorola and Time
Warner Inc., and operates multiple centers and services for 13 of its clients.
The Company's historical revenue growth has been primarily due to the addition
of new child development centers as well as increased enrollment at existing
centers. The Company reports its operating results on a June 30 fiscal year-end
basis.
First Quarter Ended
-------------------
September 30,
-------------------
1997 1996
-------- --------
Net revenues 100.0% 100.0%
Cost of services 86.1 87.3
----- -----
Gross profit 13.9 12.7
Selling, general and administrative 11.1 10.4
Amortization of non-compete agreements .3 .7
----- -----
Income from operations 2.5 1.6
Interest expense, net .3 .4
----- -----
Income before income taxes 2.2 1.2
Income tax provision .9 .5
----- -----
Net income 1.3% 0.7%
===== =====
-9-
<PAGE>
RESULTS OF OPERATIONS
Net Revenues. Net revenues increased $4.5 million, or 22.6%, to $24.2
million for the three months ended September 30, 1997 from $19.7 million for the
three months ended September 30, 1996. The growth in revenues is primarily
attributable to the net addition of 11 child development centers since September
30, 1996, including four Learning Garden centers acquired July 1, 1997 which
added $1.0 million in revenues. The remainder of the increase relates to
increased revenues at the Company's existing center base and an average tuition
increase of approximately 5%.
Gross Profits. Cost of services consists of center operating expenses,
including payroll and benefits for center personnel, facilities costs including
depreciation, supplies and other expenses incurred at the center level. Gross
profit increased $852,000, or 34.1%, to $3.3 million for the three months ended
September 30, 1997 from $2.5 million for the three months ended September 30,
1996. As a percentage of net revenues, gross profit increased to 13.9% for the
three months ended September 30, 1997 compared to 12.7% for the same period in
1996. The Company achieved higher average gross profit margins from its
existing base of centers for the period ended September 30, 1997 than it
achieved for the same three month period in 1996 due to the increased
proportion of centers that have reached mature operating levels and, to a lesser
extent, to greater use of summer programs in the quarter ending September 30,
1997.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses consist of regional and district management personnel,
corporate management and administrative functions, and marketing and
development expenses for new and existing centers. Selling, general and
administrative expenses increased $619,000, or 30.2%, to $2.7 million for the
three months ended September 30, 1997 from $2.1 million for the three months
ended September 30, 1996. The increase in selling, general and administrative
expense is primarily attributable to investments made during the last half of
the Company's fiscal year ended June 30, 1997 in additional regional management
and sales personnel to support future long-term growth, and, to a lesser extent,
to incremental administrative costs associated with the increased number of
centers in operation. As a percentage of net revenues, selling, general and
administrative expenses increased to 11.1% for the three months ended September
30, 1997 from 10.4% for the three months ended September 30, 1996.
Amortization of Non-Compete Agreements. Expenses associated with the
amortization of non-compete agreements decreased $70,000, or 50%, to $70,000 for
the three months ended September 30, 1997 from $140,000 from the three months
ended September 30, 1996 due to the use of an accelerated method of
amortization. The Company anticipates recording the remaining $210,000 in
amortization expense associated with these non-compete agreements in fiscal
1998.
Income from Operations. Income from operations increased $303,000 to
$612,000, or 98.1%, for the three months ended September 30, 1997 from $309,000
for the three months ended September 30, 1996. Excluding amortization of non-
compete agreements, operating income would have increased $233,000 or 51.9%, to
$682,000 for the three months ended September 30, 1997 from $449,000 for the
three months ended September 30, 1996.
-10-
<PAGE>
Interest Income (Expense), Net. Net interest expense increased $10,000 to
$78,000 for the three months ended September 30, 1997, from $68,000 for the
three months ended September 30, 1996, primarily due to slightly lower average
investable cash balances in the quarter ended September 30, 1997 than in the
same 1996 period.
Income Taxes Benefit (Provision). The Company's effective income tax rate
was 41.2% for the three months ended September 30, 1997 compared to 40.9% for
the three months ended September 30, 1996.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary cash requirements are the ongoing operations of its
existing centers and the addition of new centers through development or
acquisition. The Company's primary source of liquidity has been cash flow from
operations, supplemented by borrowing under its $5 million revolving line of
credit with Fleet National Bank.
Cash provided from operations increased to $3.4 million for the three months
ended September 30, 1997, from $1.9 million for the three months ended September
30, 1996. This increase was principally due to the $1.6 million increase in
deferred revenue associated with fees paid in advance during the quarter ended
September 30, 1997 for long term priority enrollment rights in certain centers
and for parent tuition paid in advance, compared to an increase of $125,000 for
such payments in the same quarter of 1996.
Cash used in investing activities increased to $4.9 million for the three months
ended September 30, 1997, from $676,000 for the three months ended September 30,
1996. This increase relates to the cash payment of $1.5 million for the
acquisition of the four Learning Garden centers on July 1, 1997 and to $3.4
million of fixed asset additions and leasehold improvements in new and existing
centers. Of this $3.4 million, approximately $700,000 represents expenditures
for new centers and to refurbish existing centers. The balance reflects the
costs associated with the acquisition of land and construction of four centers
which the Company owns and operates or will operate upon completion, and for
which the related sponsors pay fees in advance for long-term priority enrollment
rights in the center and for other guarantees. During the quarter ended
September 30, 1997, the Company received $800,000 in such fee advances, which
amounts are included in deferred revenue in the accompanying balance sheet and
which are recognized as revenue over the rights period, typically ten years.
The Company anticipates spending an additional $2.3 million through June 30,
1998 to complete construction on these centers, of which one is currently
operating, one is anticipated to open in the quarter ended December 31, 1997
and two are anticipated to open in the quarter ended March 31, 1998. In
addition, the Company expects to receive additional priority enrollment and
other guarantee fees totaling approximately $1.1 million from the related
corporate sponsors through June 30, 1998.
-11-
<PAGE>
Cash used in financing activities decreased to $23,000 for the three months
ended September 30, 1997, from $479,000 for the three months ended September 30,
1996. During the three months ended September 30, 1997 the Company repaid debt
and capital lease obligations totaling $563,000 and borrowed $520,000, $480,000
under the revolving line of credit to mortgage a center previously acquired by
the Company. During the three months ended September 30, 1996 the Company repaid
$500,000 under its bank line of credit.
The Company believes that funds provided by operations, borrowings available
under the revolving line of credit and the net proceeds from the Offering will
be adequate to meet planned operating and capital expenditure needs for at least
the next 18 months. However, if the Company were to make any significant
acquisitions or make significant investments in the purchase of facilities for
new or existing centers for corporate sponsors, it may be necessary for the
Company to obtain additional debt or equity financing.
Initial Public Offering
- -----------------------
Pursuant to the Registration Statement on Form S-1, as amended, (Registration
No. 333-14981) which was declared effective November 6, 1997, the Company
completed an initial public offering of 2,970,000 shares of its common stock, of
which 1,350,000 shares were issued and sold by the Company and 1,620,000 were
sold by the Selling Stockholders, at an offering price of $13.00 per share (the
"Offering"). On November 24, 1997, Selling Shareholders sold an additional
445,500 shares to satisfy the underwriters' overallotment option. The Company
received total proceeds of approximately $17.7 million and incurred expenses of
approximately $1.2 million for underwriting discounts and approximately
$600,000 in other expenses associated with the Offering. Approximately $4.0
million of the net proceeds was used to repay oustanding debt in November 1997.
The Company intends to use the balance of the net proceeds for working capital
and general corporate purposes, including the financing of potential
acquisitions and new centers currently under development. The managing
underwriters for the transaction were BT Alex. Brown and EVEREN Securities, Inc.
-12-
<PAGE>
BRIGHT HORIZONS, INC.
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings: None
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: None
a. Exhibits:
Exhibit 27 (for SEC use only)
b. Reports on Form 8-K: None
SIGNATURE
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 on this second day of December 1997.
BRIGHT HORIZONS, INC.
By: /s/ Elizabeth J. Boland
--------------------------------------
Elizabeth J. Boland
Chief Financial Officer
(Duly Authorized Officer and Principal
Financial and Accounting Officer)
-13-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF BRIGHT HORIZONS, INC. AT SEPTEMBER 30, 1997
AND FOR THE THREE MONTHS ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 4,547,007
<SECURITIES> 0
<RECEIVABLES> 3,404,140
<ALLOWANCES> 338,209
<INVENTORY> 0
<CURRENT-ASSETS> 12,660,078
<PP&E> 19,474,401
<DEPRECIATION> 4,995,355
<TOTAL-ASSETS> 34,368,975
<CURRENT-LIABILITIES> 16,406,590
<BONDS> 3,861,758
19,979,068
0
<COMMON> 5,805
<OTHER-SE> (10,537,146)
<TOTAL-LIABILITY-AND-EQUITY> 34,368,975
<SALES> 0
<TOTAL-REVENUES> 24,168,057
<CGS> 0
<TOTAL-COSTS> 20,818,731
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 86,813
<INCOME-PRETAX> 534,027
<INCOME-TAX> 220,000
<INCOME-CONTINUING> 314,027
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 314,027
<EPS-PRIMARY> 0.07
<EPS-DILUTED> 0.07
</TABLE>
