<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C., 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
Commission file number 1-1969
CERIDIAN CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 52-0278528
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8100 34th Avenue South, Minneapolis, Minnesota 55425
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (612)853-8100
(Former name, former address and former fiscal year if changed from last
report)
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
The number of shares of registrant's Common Stock, par value $.50 per
share, outstanding as of July 31, 1996, was 68,569,945.
<PAGE>
CERIDIAN CORPORATION AND SUBSIDIARIES
FORM 10-Q
INDEX
Pages
Part I. Financial Information
Item 1. Financial Statements
Consolidated Statements of Operations
for the three and six month periods ended
June 30, 1996 and 1995 ................................. 3
Consolidated Balance Sheets as of
June 30, 1996 and December 31, 1995 .................... 4
Consolidated Statements of Cash Flows for the six
month periods ended June 30, 1996 and 1995 ............. 5
Notes to Consolidated Financial Statements ............. 6-9
In the opinion of the Company, the unaudited consolidated
financial statements reflect all adjustments (consisting only of
normal recurring accruals, except as set forth in the notes to
consolidated financial statements) necessary to present fairly
the financial position as of June 30, 1996, and results of
operations for the three and six month periods and cash flows
for the six month periods ended June 30, 1996 and 1995.
The results of operations for the six month period ended
June 30, 1996, are not necessarily indicative of the results to
be expected for the full year.
The consolidated financial statements should be read in
conjunction with the notes to consolidated financial statements.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ................ 10-13
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K ................... 14
Signature ........................................................ 15
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<PAGE>
FORM 10-Q
PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF OPERATIONS Ceridian Corporation
(Unaudited) and Subsidiaries
For Periods Ended June 30,
Three Months Six Months
1996 1995 1996 1995
(Dollars in millions, except per share data)
<S> <C> <C> <C> <C>
Revenue
Product sales $ 154.4 $ 138.5 $ 300.7 $ 279.9
Services 207.1 188.9 429.8 373.7
Total 361.5 327.4 730.5 653.6
Cost of revenue
Product sales 108.5 101.1 216.2 209.2
Services 109.1 97.3 217.2 184.8
Total 217.6 198.4 433.4 394.0
Gross profit 143.9 129.0 297.1 259.6
Operating expenses
Selling, general and
administrative 81.3 74.7 164.5 146.9
Research and development 16.4 13.8 32.9 28.0
Other expense (income) 1.1 0.7 1.9 0.2
Earnings before interest
and taxes 45.1 39.8 97.8 84.5
Interest income 1.9 2.9 3.8 5.6
Interest expense (2.6) (7.9) (5.7) (15.6)
Earnings before income taxes 44.4 34.8 95.9 74.5
Income tax provision 3.6 5.5 7.7 9.8
Net earnings $ 40.8 $ 29.3 $ 88.2 $ 64.7
Primary earnings per share $ 0.53 $ 0.38 $ 1.16 $ 0.85
Fully diluted earnings
per share $ 0.50 $ 0.37 $ 1.09 $ 0.82
Weighted average common shares
and equivalents (000's)
Primary 70,634 69,042 70,428 68,887
Fully diluted 81,018 79,426 80,812 79,271
See notes to consolidated financial statements.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
FORM 10-Q
CONSOLIDATED Ceridian Corporation
BALANCE SHEETS (Unaudited) and Subsidiaries
June 30, December 31,
Assets 1996 1995
(In Millions)
<S> <C> <C>
Cash and equivalents $ 126.0 $ 151.7
Trade and other receivables, net 409.5 372.8
Inventories 40.3 30.4
Other current assets 15.3 15.9
Total current assets 591.1 570.8
Investments and advances 12.5 6.9
Property, plant and equipment, net 122.0 120.9
Goodwill and other intangibles, net 260.8 262.6
Software and development costs, net 91.8 72.6
Prepaid pension cost 94.4 88.6
Other noncurrent assets 3.7 3.7
Total assets $1,176.3 $1,126.1
Liabilities And Stockholders' Equity
Short-term debt and current
portion of long-term obligations 2.7 4.6
Accounts payable 58.5 54.4
Drafts and settlements payable 158.8 146.3
Customer advances 92.7 73.7
Deferred income 93.6 90.1
Accrued taxes 70.6 68.7
Employee compensation and benefits 54.9 63.6
Restructure reserves, current portion 16.5 19.2
Other accrued expenses 90.1 85.0
Total current liabilities 638.4 605.6
Long-term obligations, less current portion 142.7 205.3
Deferred income taxes 8.5 7.1
Restructure reserves, less current portion 45.9 51.2
Employee benefit plans 75.2 78.7
Deferred income and other
noncurrent liabilities 17.4 28.2
Stockholders' equity 248.2 150.0
Total liabilities and stockholders'
equity $1,176.3 $1,126.1
See notes to consolidated financial statements.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
FORM 10-Q
CONSOLIDATED STATEMENTS OF Ceridian Corporation
CASH FLOWS (Unaudited) and Subsidiaries
For Periods Ended June 30,
Six Months
1996 1995
(In Millions)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 88.2 $ 64.7
Adjustments to reconcile net earnings
to net cash provided by (used for)
operating activities:
Depreciation and amortization
of capital and deferred assets 33.9 28.0
Restructure reserves utilized (8.4) (15.6)
Net change in working capital items:
Trade and other receivables (37.8) (12.9)
Other current assets (9.2) (10.0)
Drafts and settlements 12.5 (16.1)
Customer advances and deferred income 22.2 49.2
Other current liabilities (5.0) 0.2
Other (10.4) (2.3)
Net cash provided by (used for)
operating activities 86.0 85.2
CASH FLOWS FROM INVESTING ACTIVITIES
Expended for capital assets (23.9) (26.5)
Expended for deferred software (23.4) (18.7)
Expended for business acquisitions (10.1) (22.7)
Short-term investments - (29.9)
Proceeds from sales of businesses and assets 7.3 3.0
Other 0.3 0.3
Net cash provided by (used for)
investing activities (49.8) (94.5)
CASH FLOWS FROM FINANCING ACTIVITIES
Revolving credit and overdrafts, net (59.0) 10.7
Borrowings of other debt - 2.6
Repayment of other debt (5.4) (10.9)
Preferred stock dividends (6.5) (6.5)
Exercise of stock options and other 9.0 3.9
Net cash provided by (used for)
financing activities (61.9) (0.2)
Effect of exchange rate changes on cash - 0.2
NET CASH PROVIDED (USED) (25.7) (9.3)
Cash and equivalents at beginning of period 151.7 137.8
Cash and equivalents at end of period $ 126.0 $ 128.5
See notes to consolidated financial statements.
</TABLE>
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<PAGE>
FORM 10-Q
CERIDIAN CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 1996
(Dollars in millions)
(Unaudited)
Capital and Deferred Assets
June 30, December 31,
1996 1995
Property, Plant and Equipment
Land $ 2.8 $ 3.0
Machinery and equipment 244.4 236.0
Buildings and improvements 76.1 79.4
Construction in progress 5.4 4.9
328.7 323.3
Accumulated depreciation (206.7) (202.4)
Property, plant and equipment, net $ 122.0 $ 120.9
Goodwill and Other Intangibles
Goodwill $ 224.4 $ 220.3
Accumulated amortization (33.6) (27.6)
Goodwill, net 190.8 192.7
Other intangible assets 78.5 78.8
Accumulated amortization (8.5) (8.9)
Other intangibles, net 70.0 69.9
Goodwill and other intangibles, net $ 260.8 $ 262.6
Software and Development Costs
Purchased software $ 35.6 $ 34.0
CII development cost 65.4 44.2
Other software development cost 19.4 18.5
120.4 96.7
Accumulated amortization (28.6) (24.1)
Software and development costs, net $ 91.8 $ 72.6
For Periods Ended June 30,
Six Months
Depreciation and Amortization
of Capital and Deferred Assets 1996 1995
Depreciation and amortization of
capital assets $ 21.9 $ 19.2
Amortization of goodwill 6.0 5.0
Amortization of other intangibles 2.6 1.1
Amortization of software and
development costs 4.7 3.3
Other (1.3) (0.6)
Total $ 33.9 $ 28.0
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<PAGE>
FORM 10-Q
CERIDIAN CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 1996
(Dollars in millions)
(Unaudited)
<TABLE>
<CAPTION>
STOCKHOLDERS' EQUITY
June 30, December 31,
1996 1995
<S> <C> <C>
5-1/2% Cumulative Convertible Exchangeable
Preferred Stock, $100 par value
(liquidation preference of $236.0)
Shares issued and outstanding 47,200 $ 4.7 $ 4.7
Common Stock
Par value - $.50
Shares authorized - 200,000,000
Shares issued - 68,710,319 and 67,325,372 34.4 33.7
Shares outstanding - 68,687,094 and
67,277,436
Additional paid-in capital 1,126.8 1,106.6
Accumulated deficit (882.2) (963.9)
Foreign currency translation adjustments (4.1) (2.4)
Restricted stock awards (25.0) (21.9)
Pension liability adjustment (5.2) (5.2)
Treasury stock, at cost (23,225 and
47,936 common shares) (1.2) (1.6)
Total stockholders' equity $ 248.2 $ 150.0
</TABLE>
Net cash inflows from exercise of employee stock options and other
equity transactions during the first six months of 1996 were $9.0.
Proceeds included $17.2 from stock options and $2.8 from purchases by
employees under the Company's Employee Stock Purchase Plan. Also during
this period, the Company repurchased 237,886 shares of its common stock for
$11.0 million, or an average price of $46.19 per share, in accordance with
a repurchase program authorized in 1994. Included in these shares were
111,095 repurchased from Company executives to facilitate their payment of
personal income taxes in connection with a performance restricted stock
plan initiated in 1994.
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<PAGE>
FORM 10-Q
CERIDIAN CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 1996
(Dollars in millions)
(Unaudited)
<TABLE>
<CAPTION>
RECEIVABLES
June 30, December 31,
1996 1995
<S> <C> <C>
Trade and Other Receivables, Net:
Trade, less allowance of $12.1 and $12.4 $ 302.8 $ 278.9
Unbilled 97.6 86.5
Other 9.1 7.4
Total $ 409.5 $ 372.8
</TABLE>
RESTRUCTURE RESERVES
Bal Bal
Dec 31, June 30,
1995 Adds Paid Other 1996
Severance and Related
Costs $ 7.3 $ -- $ 2.2 $ -- $ 5.1
Equipment Lease
Termination 0.6 -- 0.1 -- 0.5
Vacant Space 18.2 -- 3.9 0.2 14.5
Costs to Dispose of
Businesses 2.0 -- 0.4 0.2 1.8
Legal Costs 13.2 -- 1.1 -- 12.1
Environmental Costs 12.5 -- 0.6 -- 11.9
Duplicate
Processing/Support 1.1 -- -- -- 1.1
Other 15.5 -- 0.1 -- 15.4
Total $70.4 $ -- $ 8.4 $ 0.4 $62.4
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<PAGE>
FORM 10-Q
CERIDIAN CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 1996
(Dollars in millions)
(Unaudited)
INVESTING ACTIVITY
During the first half of 1996, Ceridian acquired several small
businesses related to its Information Services operations. In January, the
Company purchased for cash the assets of Information Learning Systems Inc.,
a provider of human resources management expert systems which had 1995
revenue of $2.5. In February, the Company acquired all of the outstanding
stock of EAS Technologies, Inc., a provider of advanced automated time and
attendance software solutions which had 1995 revenue of $3.1, in a
transaction accounted for by the pooling-of-interests method. Prior year
financial statements were not restated due to lack of materiality. In
March, the Company acquired in a stock-for-stock transaction a minority
equity interest in International Automated Energy Systems, Inc., ("IAES") a
provider of fuel management and payment systems for local fleets, which
will be associated with the Company's Comdata subsidiary. The acquisition
agreement also provided for advances to IAES by Ceridian during 1996 of up
to $6.5, repayable by the end of 2000, and an option to Ceridian (which
must be exercised under certain circumstances) to acquire the remaining
equity of IAES during 1997 in a transaction which would then be accounted
for by the pooling-of-interests method. In June, the Company purchased for
cash the assets of the Compower payroll processing services business in the
United Kingdom, which had 1995 revenue of $6.0. The aggregate
consideration for these acquisitions consisted of $6.4 in cash and 303,786
shares of the Company's common stock.
Results of operations and cash flows for 1995 have been restated for
the acquisitions of Resumix, Inc. and Comdata Holdings Corporation in
August and December 1995, respectively, which were accounted for by the
pooling-of-interests method.
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<PAGE>
CERIDIAN CORPORATION AND SUBSIDIARIES
FORM 10-Q
June 30, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The statements regarding the outlook for Ceridian Corporation (the
"Company") contained in this section are forward-looking statements based
on current expectations, and entail various risks and uncertainties that
could cause actual results to differ materially from those expressed in
such forward-looking statements. Important factors known to the Company
that could cause such material differences are discussed below and under
the caption "1996 Financial Outlook" contained in the "Management's
Discussion and Analysis of Results of Operations and Financial Condition"
contained in Part II, Item 7 of the Company's Annual Report on Form 10-K
for the year ended December 31, 1995, which discussion is incorporated
herein by reference.
Results of Operations
Revenue. Revenue for the Company, its two industry segments and the
businesses that comprise those segments is as follows:
Periods Ended June 30,
Three Months Six Months
1996 1995 1996 1995
(Dollars in millions)
Information Services Segment
Arbitron $ 39.4 $ 36.4 $ 75.5 $ 64.6
Human Resources Group 114.4 95.3 241.0 201.2
Comdata 72.5 68.5 144.0 131.5
Total Information Services 226.3 200.2 460.5 397.3
Defense Electronics Segment
Computing Devices International 135.2 127.2 270.0 256.3
Total Revenue $ 361.5 $ 327.4 $ 730.5 $ 653.6
About one-half of the 20% revenue growth in the Human Resources Group
("HRG") in the three and six-month comparisons was due to acquisitions,
primarily Centre-file. Apart from acquisitions and after adjusting for the
1996 decrease in the average annual yield on tax filing deposits, HRG's
revenue increased 9.4% and 9.7% in the quarterly and year-to-date
comparisons, respectively.
Comdata's revenue increased 5.8% and 9.5% in the three and six month
comparisons, with a small portion of the six month increase reflecting the
net effect of the first quarter 1995 acquisition of Trendar and sale of the
retail services division. The internal revenue growth in Comdata reflected
9.5% and 8.7% revenue growth from transportation services in the quarterly
and year-to-date comparisons, respectively, and 0.7% and 9.6% revenue
growth from gaming services over the same periods. The revenue growth from
transportation services was primarily due to an increase in funds transfer
transactions as well as increased demand for fuel desk automation systems
and telecommunications services. The quarterly comparison of revenue from
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<PAGE>
CERIDIAN CORPORATION AND SUBSIDIARIES
FORM 10-Q
June 30, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations (cont.)
gaming services primarily reflected slower growth in the gaming industry
generally and in Comdata's new gaming accounts, and a second quarter 1996
increase in the merchant discount on credit card cash advances, which is
netted against revenue. Comdata is implementing various measures,including
price increases, to mitigate or eliminate the effect of this merchant
discount increase. Revenue from ATM transactions increased significantly
in the three and six month comparisons, reflecting the expansion of the ATM
network and the second quarter 1996 introduction of surcharges in
connection with such transactions. Also contributing to Comdata's overall
revenue growth was a $2.2 million increase in revenue year-to-date from
unsettled transactions.
Arbitron's revenue increased 8.4% and 16.9% in the quarterly and year-
to-date comparisons, with somewhat more than a third and a half of the
respective increases attributable to a change in the revenue recognition
policy of the Scarborough Research Partnership ("SRP"). The balance of
Arbitron's revenue increase was primarily due to growth in sales of radio
audience measurement services and analytical software.
Computing Devices' revenue increase in both the three and six month
comparisons was due to its Canadian and United Kingdom operations. The
revenue increase in the Canadian operations was due in large measure to
ground system products, particularly a multi-year contract to develop and
produce a reconnaissance system for a light armored vehicle. The increase
in revenue from the United Kingdom operations was primarily due to a
contract to provide ground systems for reconnaissance processing.
Gross Margin. The Company's gross margin increase in each of the
three and six month comparisons was due largely to the relatively greater
revenue growth in the Information Services segment, which has higher gross
margins. The six month comparison also benefited from gross margin
improvement in Computing Devices from 20.3% to 22.0%, due largely to
revenue mix in its U.S. operations.
Information Services' gross margin decreased from 52.2% to 51.6% in
the six month comparison, due largely to a decrease in Comdata's gross
margin in the quarterly and year-to-date comparisons. The Comdata decrease
was primarily due to a rate of increase in agent commissions paid to gaming
locations in excess of the rate of growth in related revenue, and to
greater revenue growth from fuel desk automation systems and
telecommunications services, which have lower gross margins than most other
aspects of Comdata's business.
Operating Expenses. The Company's selling expense decreased from
14.1% and 14.0% of revenue in the second quarter and first half of 1995,
respectively, to 13.0% of revenue in the comparable 1996 periods. This
decrease was primarily attributable to HRG, reflecting increased
concentration of Employer Services' sales and marketing efforts on medium-
and large-sized employers, and generally lower selling expenses as a
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<PAGE>
CERIDIAN CORPORATION AND SUBSIDIARIES
FORM 10-Q
June 30, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations (cont.)
percentage of revenue in more recently acquired businesses. Partially
offsetting this decrease was an increase in selling expenses as a
percentage of revenue in Computing Devices, reflecting efforts to expand
existing products and technologies into new markets, including human
resource service offerings to potential government customers.
The Company's general and administrative expenses increased from 8.6%
and 8.5% of revenue in the second quarter and first half of 1995,
respectively, to 9.5% percent of revenue in the comparable 1996 periods.
This increase was attributable to the Information Services segment,
primarily reflecting acquisitions made during 1995 and early 1996,
including related amortization of goodwill and intangibles.
The Company's research and development expenses increased from 4.2%
and 4.3% of revenue in the second quarter and first half of 1995,
respectively, to 4.5% percent of revenue in the comparable 1996 periods,
reflecting development efforts related to payroll processing and
client/server software. As a result of the testing and successful live
processing of payrolls with the first version of the CII payroll processing
software with a limited number of customers during the first half of 1996,
the Company has determined that rather than separately testing and
commercially releasing a second "interim" version of the CII software as
had been originally anticipated, it would be more beneficial for both
customers and the Company if the second version of the CII software tested
and ultimately released were to include certain enhancements to increase
its functionality as well as a client/server front-end that features open
data base connectivity. Testing of this enhanced second version is
expected to begin with a limited number of customers near the end of 1996
and continue in the first half of 1997. The systematic release of this
enhanced CII software for use by new and existing customers, the
amortization of the capitalized software costs associated with the CII
development effort and the realization of operational efficiencies that may
be associated with the new system are expected to be deferred accordingly.
Earnings Before Interest and Taxes ("EBIT"). The Company's EBIT
increased $5.1 million, or 12.8%, in the quarterly comparison and $13.1
million, or 15.5%, in the year-to-date comparison. Information Services'
EBIT increased $3.4 million, or 10.2%, in the quarterly comparison, and
$6.7 million, or 9.3%, in the year-to-date comparison. As a percentage of
revenue, Information Services' EBIT decreased from 16.5% to 16.1% in the
quarterly comparison, and from 18.1% to 17.0% in the year-to-date
comparison. Computing Devices' EBIT increased $0.8 million, or 9.1%, in
the quarterly comparison, and $3.4 million, or 21.2%, in the year-to-date
comparison. As a percentage of revenue, Computing Devices' EBIT increased
from 6.9% to 7.1% in the three month comparison, and from 6.3% to 7.3% in
the six month comparison.
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<PAGE>
CERIDIAN CORPORATION AND SUBSIDIARIES
FORM 10-Q
June 30, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations (cont.)
Interest Income and Expense and Taxes. The decrease in interest
expense in the quarterly and year-to-date comparisons reflected lower
levels of debt and lower interest rates, primarily as a result of the 1995
refinancing of Comdata's debt. The decrease in interest income reflected
lower levels of cash and short-term investments in 1996. The decreases in
the provisions for income taxes in the three and six month comparisons
primarily represent the utilization of Ceridian's net operating loss
carryforwards to shelter Comdata's 1996 income from U.S. federal income
tax.
Financial Condition
With respect to operating cash flows, net earnings adjusted to a cash
basis provided cash of $111.7 million in the first half of 1996 and $90.4
million in the first half of 1995. The increase in trade and other
receivables in the first half of 1996 primarily reflected an increase in
Comdata's receivables as compared to what is typically a seasonal low point
at year-end, and an increase in Computing Devices' unbilled receivables.
Partially offsetting the impact of this increase was the receipt in the
second quarter 1996 of a $20.0 million customer advance as a result of
Computing Devices achieving a performance milestone under the Iris
contract. A similar advance had been received in June 1995.
The most significant contributors to the decrease in cash used for
investing activities in the six month comparison were the 1995 increase in
short-term investments and the greater amount expended in 1995 to acquire
businesses, primarily Trendar. The first half 1996 increase in
expenditures for capitalized software primarily involved the CII software
development effort. The cash used for financing activities during the
first half of 1996 primarily involved the repayment of $60.0 million under
the Company's revolving credit facility. Information regarding the cash
impact of the Company's repurchases of its common stock and of stock option
exercises during the first half of 1996 is contained in the financial
statement note entitled "Stockholders' Equity."
At June 30, 1996, $135.0 million in revolving loans and $1.4 million
in standby letters of credit were outstanding under the Company's revolving
credit facility. The applicable interest rate for loans under the credit
facility varies, and at June 30, 1996 was 6.1%. At June 30, 1996, the
Company was in compliance with all covenants contained in the credit
facility, and would have been entitled to avail itself of an additional
$158 million of borrowing under the permitted debt covenant in the credit
facility.
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<PAGE>
CERIDIAN CORPORATION AND SUBSIDIARIES
FORM 10-Q
June 30, 1996
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
Exhibit Description Code
3 Certificate of Amendment of Restated
Certificate of Incorporation E
11 Statement re computation of per share
earnings E
Legend: (E) Electronic Filing
- 14 -
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Quarterly Report on Form 10-Q for the
period ended June 30, 1996, to be signed on its behalf by the undersigned
thereunto duly authorized.
CERIDIAN CORPORATION
Registrant
Date: August 13, 1996 /s/L. D. Gross
L. D. Gross
Vice President and
Corporate Controller
(Principal Accounting Officer)
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<PAGE>
<PAGE>
Exhibit 3
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
CERIDIAN CORPORATION
Ceridian Corporation, a corporation organized and existing under and
by virtue of the laws of the State of Delaware (the "
Corporation"),
pursuant to the provisions of the General Corporation Law of the State of
Delaware (the ``
DGCL''), DOES HEREBY CERTIFY that:
FIRST: The Restated Certificate of Incorporation of the Corporation
is hereby amended by deleting Paragraph A of Article IV of the Restated
Certificate of Incorporation in its present form and substituting therefor
a new Paragraph A of Article IV in the following form:
A. The total number of shares of all classes of stock which the
Corporation shall have authority to issue is Two Hundred Million,
Seven Hundred Fifty Thousand (200,750,000), consisting of Seven
Hundred Fifty Thousand (750,000) shares of preferred stock of the par
value of One Hundred Dollars ($100.00) per share (the "Preferred
Stock"), having a total par value of Seventy-Five Million Dollars
($75,000,000), and Two Hundred Million (200,000,000) shares of common
stock of the par value of fifty cents ($.50) per share (the "Common
Stock"), having a total par value of One Hundred Million Dollars
($100,000,000).
SECOND: The amendment to the Restated Certificate of Incorporation
of the Corporation set forth in this Certificate of Amendment has been duly
adopted in accordance with the provisions of Section 242 of the DGCL; (a)
the Board of Directors of the Corporation having duly adopted resolutions
on February 2, 1996 setting forth such amendment, declaring its
advisability and directing that such amendment be submitted to the
stockholders of the Corporation for their consideration and approval at the
next annual meeting of stockholders, and (b) the stockholders of the
Corporation having duly approved and adopted such amendment by a vote of
the holders of a majority of the shares of outstanding stock of the
Corporation entitled to vote thereon at the Corporation's 1996 annual
meeting of stockholders duly held on May 8, 1996, upon notice in accordance
with Section 222 of the DGCL.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Amendment to be signed by John A. Haveman, its Vice President & Secretary,
there unto duly authorized, and attested by Ann M. Curme, its Assistant
Secretary, this twentieth day of May, 1996.
Ceridian Corporation
By: /s/ John A. Haveman
John A. Haveman
Vice President & Secretary
<PAGE>
ATTEST:
/s/ Ann M. Curme
Ann M. Curme
Assistant Secretary
<PAGE>
<PAGE>
<PAGE>
Exhibit 11
CERIDIAN CORPORATION AND SUBSIDIARIES
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
<TABLE>
(Amounts in millions, except per share data)
For Periods Ended June 30,
<S> <C> <C> <C> <C>
Three Months Six Months
1996 1995 1996 1995
Net earnings for common
stockholders - primary $ 37.6 $ 26.1 $ 81.7 $ 58.2
Restore dividends on
convertible preferred
stock 3.2 3.2 6.5 6.5
Net earnings for fully
diluted earnings
per share $ 40.8 $ 29.3 $ 88.2 $ 64.7
Weighted average common
shares outstanding 67,878 66,103 67,546 66,051
Common share equivalents
from stock options and
restricted stock awards 2,756 2,939 2,882 2,836
Weighted average common
shares and equivalents
outstanding - primary 70,634 69,042 70,428 68,887
Shares issuable assuming
conversion of preferred
stock 10,384 10,384 10,384 10,384
Weighted average common
shares and equivalents
outstanding - adjusted
for full dilution 81,018 79,426 80,812 79,271
Net earnings for common
stockholders - primary $ 37.6 $ 26.1 $ 81.7 $ 58.2
Weighted average common
shares and equivalents
outstanding - primary 70,634 69,042 70,428 68,887
Primary earnings per share $ 0.53 $ 0.38 $ 1.16 $ 0.85
Net earnings for fully
diluted earnings
per share $ 40.8 $ 29.3 $ 88.2 $ 64.7
Weighted average common
shares and equivalents
outstanding - adjusted
for full dilution 81,018 79,426 80,812 79,271
Fully diluted earnings
per share $ 0.50 $ 0.37 $ 1.09 $ 0.82
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-END> Jun-30-1996
<PERIOD-TYPE> 6-MOS
<CASH> 126,000
<SECURITIES> 0
<RECEIVABLES> 421,600
<ALLOWANCES> 12,100
<INVENTORY> 40,300
<CURRENT-ASSETS> 591,100
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,176,300
<CURRENT-LIABILITIES> 638,400
<BONDS> 142,700
<COMMON> 34,400
0
4,700
<OTHER-SE> 209,100
<TOTAL-LIABILITY-AND-EQUITY> 1,176,300
<SALES> 300,700
<TOTAL-REVENUES> 730,500
<CGS> 216,200
<TOTAL-COSTS> 433,400
<OTHER-EXPENSES> 1,900
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,700
<INCOME-PRETAX> 95,900
<INCOME-TAX> 7,700
<INCOME-CONTINUING> 88,200
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 88,200
<EPS-PRIMARY> 1.16
<EPS-DILUTED> 1.09
</TABLE>
