<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 1994
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 0-12771
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 95-3630868
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10260 Campus Point Drive
San Diego, California 92121
(619) 546-6000
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
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 30, 1994, the Registrant had 45,130,245 shares of Class A
common stock, $.01 par value per share, issued and outstanding, and 344,623
shares of Class B common stock, $.05 par value per share, issued and
outstanding.
<PAGE>
PART I
FINANCIAL INFORMATION
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Unaudited, in thousands, except per-share amounts)
<TABLE>
<CAPTION>
Three months ended Nine months ended
--------------------------------- ----------------------------------
October 31, 1994 October 31, 1993 October 31, 1994 October 31, 1993
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Revenues $ 489,328 $ 430,017 $1,386,910 $1,194,838
---------- ---------- ---------- ----------
Costs and expenses:
Cost of revenues 432,068 379,359 1,223,825 1,051,784
Selling, general and
administrative expenses 37,309 29,987 103,386 88,093
Interest expense 1,196 704 2,614 2,163
---------- ---------- ----------- ---------
470,573 410,050 1,329,825 1,142,040
---------- ---------- ----------- ----------
Income before income taxes 18,755 19,967 57,085 52,798
Provision for income taxes 5,534 8,386 21,978 22,175
---------- ---------- ----------- ---------
Net income $ 13,221 $ 11,581 $ 35,107 $ 30,623
---------- ---------- ----------- ---------
---------- ---------- ----------- ---------
Earnings per share of
common stock and
equivalents $ .27 $ .25 $ .73 $ .65
--------- ---------- ---------- ---------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
CONSOLIDATED BALANCE SHEET
(in thousands)
<TABLE>
<CAPTION>
October 31, 1994 January 31, 1994
---------------- ----------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 41,210 $ 53,556
Receivables 363,715 356,836
Inventories 24,489 14,764
Prepaid expenses 14,646 10,354
Deferred income taxes 29,758 22,083
---------- ----------
Total current assets 473,818 457,593
Property and equipment (less accumulated depreciation
of $107,005 and $96,538 at October 31, 1994
and January 31, 1994, respectively) 48,292 50,581
Land and buildings (less accumulated depreciation of
$7,919 and $6,492 at October 31, 1994
and January 31, 1994, respectively) 82,382 69,161
Other assets 64,274 34,240
---------- ----------
$ 668,766 $ 611,575
---------- ----------
---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 151,244 $ 133,433
Accrued payroll and employee benefits 101,791 106,548
Income taxes payable 11,013 9,889
Notes payable and current portion of long-term liabilities 1,968 1,143
---------- ----------
Total current liabilities 266,016 251,013
Long-term liabilities 28,365 25,060
Stockholders' equity:
Common stock:
Class A, $.01 par value
Authorized: 100,000 shares
Issued and outstanding:
October 31, 1994 - 45,102 shares 451
January 31, 1994 - 44,315 shares 443
Class B, $.05 par value
Authorized: 5,000 shares
Issued and outstanding:
October 31, 1994 - 345 shares 17
January 31, 1994 - 364 shares 19
Additional paid-in capital 192,916 172,713
Retained earnings 181,001 162,327
------------ ----------
Total stockholders' equity 374,385 335,502
------------ ----------
$ 668,766 $ 611,575
------------ ----------
------------ ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in thousands)
<TABLE>
<CAPTION>
Nine months ended
-----------------------------------
October 31, 1994 October 31, 1993
---------------- ----------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 35,107 $ 30,623
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 18,939 16,797
Noncash compensation 9,716 8,310
Loss on disposal of property and equipment 335 420
Increase (decrease) in cash resulting from changes in:
Receivables (10,727) 36,061
Inventories (10,474) (6,981)
Prepaid expenses (4,292) 736
Deferred income taxes (7,675) (7,201)
Other assets (2,693) (5,962)
Progress payments 4,597 (547)
Accounts payable and accrued liabilities 17,811 (19,887)
Accrued payroll and employee benefits (4,757) 15,956
Income taxes payable 3,953 (670)
----------- -----------
49,840 67,655
----------- -----------
Cash flows from investing activities:
Expenditures for property and equipment (12,544) (12,499)
Expenditures for land and buildings (14,648)
Acquisitions of certain business assets (16,518) (3,027)
Proceeds from disposal of property and equipment 150 270
Purchase of marketable securities (13,988)
----------- -----------
(57,548) (15,256)
----------- -----------
Cash flows from financing activities:
Increase (decrease) in notes payable and long-term liabilities 1,718 (669)
Sales of common stock 16,321 18,770
Repurchases of common stock (22,677) (19,855)
----------- -----------
(4,638) (1,754)
----------- -----------
(Decrease) increase in cash and cash equivalents (12,346) 50,645
Cash and cash equivalents at beginning of period 53,556 15,989
----------- -----------
Cash and cash equivalents at end of period $ 41,210 $ 66,634
----------- -----------
----------- -----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying financial information has been prepared in accordance with
the instructions to Form 10-Q and therefore does not necessarily include all
information and footnotes necessary for a fair presentation of financial
position, results of operations and cash flows in conformity with generally
accepted accounting principles.
Effective February 1, 1994, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 112, "Employers' Accounting for
Postemployment Benefits," SFAS No. 115, "Accounting for Certain
Investments in Debt and Equity Securities," and Statement of Position
("SOP") 93-6, "Employers' Accounting for Employee Stock Ownership Plans."
Adoption of SFAS No. 112 had an immaterial effect on net income for the
nine months ended October 31, 1994, while adoption of SFAS No. 115 and SOP
93-6 did not have an effect on the Company's financial
position or results of operations during the nine months ended October 31,
1994.
Certain amounts from the nine months ended October 31, 1993 have been
reclassified in the consolidated financial statements to conform to the
presentation of the nine months ended October 31, 1994.
The number of outstanding common stock equivalents referred to in Note F
includes Class A common stock and the conversion of each share of Class B
common stock into five shares of Class A common stock.
In the opinion of management, the unaudited financial information for the
nine month periods ended October 31, 1994 and 1993 reflect all adjustments
(which include only normal, recurring adjustments) necessary for a fair
presentation thereof.
NOTE B - RECEIVABLES
Unbilled accounts receivable include $8,287,000 of costs incurred on
projects for which the Company has been requested by the customer to begin
work under a new contract, or extend work under a present contract, but for
which formal contracts or contract modifications have not been executed at
October 31, 1994.
NOTE C - COMPOSITION OF CERTAIN FINANCIAL STATEMENT CAPTIONS
<TABLE>
<CAPTION>
October 31, 1994
(in thousands)
<S> <C>
Inventories:
Contracts-in-process, less progress payments of $4,652 $ 9,195
Raw Materials 15,294
--------
$ 24,489
--------
--------
Other Assets:
Intangibles $ 30,885
Marketable securities 20,119
Deferred taxes 3,400
Other 9,870
--------
$ 64,274
--------
--------
</TABLE>
NOTE D - MARKETABLE SECURITIES
Marketable securities consist of long-term municipal bonds held to maturity
and measured at amortized cost in accordance with recently issued SFAS
No. 115, "Accounting for Certain Investments in Debt and Equity Securities."
As of October 31, 1994, marketable securities of $20,119,000 had a fair value
of $19,580,000 maturing in two to three years.
<PAGE>
NOTE E - NOTES PAYABLE
The Company has substantially equivalent unsecured revolving credit/term loan
agreements with three banks totaling $67,500,000 which allow borrowings on a
revolving basis until July 1, 1996. At that time, the Company has the option
to borrow under three-year term notes, payable in twelve quarterly
installments. The agreements enable borrowings at various interest rates, at
the Company's option, based on prime, money market, London interbank
borrowing, certificate of deposit, bankers' acceptance, or other negotiated
rates. Annual facility fees are 1/4 of 1% of the total commitment during the
initial revolving credit term. As of October 31, 1994, the entire $67,500,000
was available under the most restrictive debt covenants of the credit/term
loan agreements.
NOTE F - EMPLOYEE BENEFIT PLANS
The Company has an Employee Stock Ownership Plan (the "Plan") in which
eligible employees participate. The Company has made cash contributions to
the Plan based upon amounts determined annually by the Board of Directors.
Contributions have been allocated to participants' accounts based on their
annual compensation. The Company recognizes compensation expense as the fair
value of the common stock or cash in the year of contribution. Compensation
expense of $7,830,000 was recorded for the nine months ended October 31,
1994. A participant's interest in their Plan accounts vests 25% per year
in the third through sixth year of service. Shares of common stock
distributed from the Plan bear a limited put option that, if exercised,
would require the Company to repurchase the shares at the current fair
value. At October 31, 1994, the Plan held 16,170,000 equivalent shares of
common stock with a fair value of $243,675,000. All shares held by the Plan
are included in the computation of earnings per share which is based on the
weighted average number of shares of common stock outstanding, increased by
the effect of dilutive options.
NOTE G - INCOME TAXES
Income taxes for interim periods are computed using the estimated annual
effective rate method. The effective rate for the nine months ended
October 31, 1994 reflects the settlement of certain issues relating to the
Company's 1986 and 1987 income tax returns.
NOTE H - COMMITMENTS AND CONTINGENCIES
On February 15, 1994, the Company was served with search warrants and a
subpoena for documents and records associated with the performance by the
SAIT operating unit of the Company under three development programs for the
Department of Defense (DOD). On August 1, 1994, the U. S. District Court for
the Southern District of California unsealed a civil complaint that had been
filed under seal on March 13, 1993 by an employee of the Company's SAIT
operating unit seeking damages on behalf of the U. S. Government under the
Federal False Claims Act. On August 1, 1994, the U.S. Government announced
its intention to intervene in the case and to file an amended complaint
without giving any indication of the substance of the amended complaint.
The Company is unable at this stage to assess the impact, if any, that this
investigation and the lawsuit might ultimately have on its consolidated
financial position, results of operations or ability to conduct business.
The Company is also involved in various other investigations, claims and
lawsuits arising in the normal conduct of its business, none of which the
Company anticipates will have a material adverse effect on its consolidated
financial position, results of operations or ability to conduct business.
The Company leases a general purpose office building and has guaranteed a
$12,250,000 loan on behalf of the building owner. Certain financial
ratios and balances required by the guarantee have been maintained.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Revenues for the three and nine months ended October 31, 1994 increased
13.8% and 16.1%, respectively, compared to the same periods of the prior
year and continued to shift toward lower cost service type contracts. This
trend reflects the increasingly competitive business environment in the
Company's traditional business areas, as well as the Company's increased
success in the engineering and field services market, which typically involve
lower cost contracts.
Revenues are generated from the efforts of the Company's technical staff as
well as the pass through of costs for materials and subcontract efforts,
which primarily occur on large, multi-year contracts. At October 31, 1994,
the Company had approximately 16,200 full-time employees compared to
approximately 14,900 at October 31, 1993. Material and subcontract ("M&S")
revenues were $143 million and $378 million for the three and nine months
ended October 31, 1994, respectively, compared to $119 million and $288
million for the same periods of the prior year. As a percentage of total
revenues, M&S revenues were 29% and 27% for the three and nine months ended
October 31, 1994, respectively, compared to 28% and 24% for the same
periods of the prior year and have increased primarily due to the growth
of product revenues. Product revenues generally have a
very high percentage of M&S content.
The Company's principal customer, the U.S. Government, continues to shift
the procurement of product and system development contracts to
cost-reimbursement, time-and-materials ("T&M") or fixed-price
level-of-effort ("FP-LOE") contracts, instead of firm fixed-price ("FFP")
contracts. This, along with more selective bidding of FFP opportunities,
resulted in the decrease of the percentage of the Company's revenues
attributable to the higher risk, FFP contracts to 17% for the nine months
ended October 31, 1994 from 19% for same period of the prior year.
FP-LOE and T&M type contracts represented 22% and 19% of revenues for the
nine months ended October 31, 1994 and 1993, respectively, while cost
reimbursement contracts were 61% and 62% for the same periods, respectively.
The Company assumes greater performance risk on FFP contracts and the
failure to accurately estimate ultimate costs or to control costs during
performance of the work may result in reduced profits or losses. The
Company incurred overruns during the performance of certain FFP contracts
for the nine months ended October 31, 1994 and 1993.
The cost of revenues as a percentage of revenues (excluding interest income)
increased to 88.4% and 88.3% for the three and nine months ended October 31,
1994, respectively, compared to 88.3% and 88.1% for the same periods of the
prior year, respectively. The higher percentage of cost of revenues
percentage is primarily attributable to three factors: overruns during the
performance of certain FFP contracts; faster revenue growth in the lower cost
service type contracts, which typically have higher cost of revenues; and
faster growth in M&S revenues which have nearly all their associated costs
in the cost of revenues category.
Selling, general and administrative ("SG&A") expenses as a percentage of
revenues (excluding interest income) for the three and nine months ended
October 31, 1994 increased to 7.6% and 7.5%, respectively, from 7.0% and
7.4% for the same periods of the prior year. SG&A is comprised of general
and administrative ("G&A"), bid and proposal ("B&P') and independent
research and development ("IR&D") expenses. B&P costs remained constant
as a percentage of revenues for the nine months ended October 31, 1994,
compared to the same period of the prior year and decreased as a percentage
of revenues for the three months ended October 31, 1994 compared to the
same period of the prior year. B&P costs typically fluctuate with the
number and size of proposals being prepared by the Company. IR&D costs
increased as a percentage of revenues. IR&D spending fluctuates depending
on the stage of development for various hardware and software systems.
G&A expenses as a percentage of revenues increased for the three months
ended October 31, 1994 compared to the same period of the prior year,
while remaining relatively constant as a percentage of revenues for the
nine months ended October 31, 1994 compared to the same period of the
prior year. The Company continues to closely monitor G&A expenses as
part of an on-going program to control indirect costs.
Interest expense for the nine months ended October 31, 1994 and 1993
primarily relates to interest on a building mortgage and deferred
compensation.
The effective income tax rate for the nine months ended October 31, 1994
reflects the settlement of certain issues relating to the Company's 1986
and 1987 income tax returns.
Effective February 1, 1994, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 112,
<PAGE>
"Employers' Accounting for Postemployment Benefits," SFAS No. 115,
"Accounting for Certain Investments in Debt and Equity Securities," and
Statement of Position ("SOP") 93-6, "Employers' Accounting for Employee Stock
Ownership Plans." Adoption of SFAS No. 112 had an immaterial effect on net
income for the nine months ended October 31, 1994, while adoption of SFAS
No. 115 and SOP 93-6 did not have an effect on the Company's financial
position or results of operations during the nine months ended October 31,
1994.
On February 15, 1994, the Company was served with search warrants and a
subpoena for documents and records associated with the performance by the
SAIT operating unit of the Company under three development contracts for the
Department of Defense (DOD). On August 1, 1994, the U. S. District Court
for the Southern District of California unsealed a civil complaint that had
been filed under seal on March 13, 1993 by an employee of the Company's SAIT
operating unit seeking damages on behalf of the U. S. Government under the
Federal False Claims Act. On August 1, 1994, the U.S. Government announced
its intention to intervene in the case and to file an amended complaint
without giving any indication of the substance of the amended complaint.
The Company is unable at this stage to assess the impact, if any, that this
investigation and the lawsuit might ultimately have on its consolidated
financial position, results of operations or ability to conduct business.
The Company is also involved in various other investigations, claims and
lawsuits arising in the normal conduct of its business, none of which the
Company anticipates will have a material adverse effect on its consolidated
financial position, results of operations or ability to conduct business.
Liquidity and Capital Resources
The Company's primary sources of liquidity continue to be funds provided by
operations and revolving credit/term loan agreements. At October 31, 1994,
there were no borrowings outstanding under such agreements. The Company
continues to actively monitor receivables with emphasis placed on collection
activities and the negotiation of more favorable payment terms. Average
receivable days outstanding as of October 31, 1994 decreased to 63 days from
64 days as of the fiscal year end January 31, 1994. The Company's cash flows
from operations plus borrowing capacity are expected to provide sufficient
funds for the Company's operations, business acquisitions, common stock
repurchases and planned capital expenditures.
<PAGE>
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As first reported in the Company's Form 8-K Report dated February 18, 1994
and updated in the Form 10-K Annual Report for the fiscal year ended January
31, 1994, the Form 10-Q Quarterly Report for the quarter ended April 30, 1994,
and the Form 8-K current report dated November 14, 1994, on February 15, 1994,
the Company was served with search warrants and a subpoena for documents and
records associated with the performance by the SAIT operating unit of the
Company under three development programs for the Department of Defense (DOD).
The search warrants and subpoena state that the Government is seeking evidence
regarding the making of false claims to the DOD, as well as conspiracy to
commit such offenses. The Company has cooperated fully with the U.S.
Government's investigation.
On August 1, 1994, the U. S. District Court for the Southern District of
California unsealed a civil complaint that had been filed under seal on March
13, 1993 by an employee of the Company's SAIT operating unit seeking damages
on behalf of the U. S. Government under the Federal False Claims Act. Such
Act provides for the recovery of treble the amount of damages, if any,
suffered by the U.S. Government and penalties of between $5,000 and $10,000
for each violation.
In the complaint, the individual alleges that the SAIT operating unit of the
Company made false statements to the government in connection with the three
DOD programs which were the subject of the search warrants and subpoena. The
three programs involved more than $10,000,000 in revenues in the aggregate for
the Company; however, the complaint does not specify what portion of these
revenues are attributable to the alleged false claims.
On August 1, 1994, the U.S. Government announced its intention to intervene
in the case and to file an amended complaint without giving any indication of
the substance of the amended complaint. The Company has participated in a
series of meetings with the U.S. Government in which the Company has provided
the U.S. Government with information responding to various allegations
contained in the civil complaint filed by the individual. In the most recent
meeting, the U.S. Government identified certain issues it was investigating.
The Company is in the process of responding to these issues. On November 8,
1994, the Court granted the Company's motion to dismiss the employee as the
relator of the case for failing to meet the jurisdictional requirements of
the False Claims Act; however, the employee has 30 days in which to appeal,
and the ruling does not affect the ability of the Government to continue to
pursue these claims. Because the Company is not fully aware of the substance
of all of the U.S. Government's claims, it is unable at this stage to asses
the impact, if any, that this investigation and the lawsuit may ultimately
have on its consolidated financial position, results of operations or ability
to conduct business.
The Company is also involved in various other investigations, claims and
lawsuits arising in the normal conduct of its business, none of which, in
the opinion of the registrant's management, will have a material adverse
effect on the registrant's consolidated financial position, results of
operations or ability to conduct business.
ITEM 2. CHANGES IN SECURITIES
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
<PAGE>
ITEM 5. OTHER INFORMATION
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits - See Exhibit Index.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed by the registrant during the fiscal
quarter for which this report is on file.
<PAGE>
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.
SCIENCE APPLICATIONS
INTERNATIONAL CORPORATION
Date: December 5, 1994 /s/ W. A. Roper
Senior Vice President and
Chief Financial Officer and
as a duly authorized officer
<PAGE>
Exhibit Index
Science Applications International Corporation
Fiscal Quarter Ended October 31, 1994
<TABLE>
<CAPTION>
Exhibit
No. Description of Exhibits
<S> <C>
11 Statement re: Computation of Per Share Earnings
27 Financial Data Schedule
</TABLE>
<PAGE>
EXHIBIT 11
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
EXHIBIT TO CONSOLIDATED FINANCIAL STATEMENTS
COMPUTATION OF PER SHARE EARNINGS
(UNAUDITED, IN THOUSANDS, EXCEPT PER-SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three months ended Nine months ended
----------------------------------- -----------------------------------
October 31, 1994 October 31, 1993 October 31, 1994 October 31, 1993
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
PRIMARY:
Net income $ 13,221 $ 11,581 $ 35,107 $ 30,623
Reduction of interest expense, net of
income tax expense on assumed retirement
of short-term and long-term debt 201 115 589 458
Interest earned, net of income tax expense on
assumed investment of U.S. government
securities or commercial paper 17 -- 70 17
---------------- ---------------- ---------------- ----------------
Adjusted net income $ 13,439 $ 11,696 $ 35,766 $ 31,098
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Weighted average shares outstanding 46,654 45,543 46,520 45,289
Dilutive stock options, based on the modified
treasury stock method, using average fair value 2,619 1,898 2,794 2,213
---------------- ---------------- ---------------- ----------------
Total average shares outstanding 49,273 47,441 49,314 47,502
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Per Share Amount $ .27 $ .25 $ .73 $ .65
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
FULLY DILUTED:
Net income $ 13,221 $ 11,581 $ 35,107 $ 30,623
Reduction of interest expense, net of
income tax expense on assumed retirement
of short-term and long-term debt 201 102 589 435
Interest earned, net of income tax expense on
assumed investment of U.S. government
securities or commercial paper -- -- 46 5
---------------- ---------------- ---------------- ----------------
Adjusted net income $ 13,422 $ 11,683 $ 35,742 $ 31,063
---------------- ---------------- ---------------- ----------------
Weighted average shares outstanding 46,654 45,543 46,520 45,289
Dilutive stock options, based on the modified
treasury stock method, using quarter-end or
exercise date established price if higher than
average fair value 2,619 1,898 2,794 2,213
---------------- ---------------- ---------------- ----------------
Total average shares outstanding 49,273 47,441 49,314 47,502
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Per Share Amount $ .27 $ .25 $ .73 $ .65
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated balance sheet and related consolidated statement of income and cash
flows for the nine months ended October 31, 1994 and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-31-1995
<PERIOD-START> FEB-01-1994
<PERIOD-END> OCT-31-1994
<CASH> 41,210
<SECURITIES> 20,119
<RECEIVABLES> 363,715
<ALLOWANCES> 0
<INVENTORY> 24,489
<CURRENT-ASSETS> 473,818
<PP&E> 245,598
<DEPRECIATION> 114,924
<TOTAL-ASSETS> 668,766
<CURRENT-LIABILITIES> 266,016
<BONDS> 0
<COMMON> 468
0
0
<OTHER-SE> 373,917
<TOTAL-LIABILITY-AND-EQUITY> 668,766
<SALES> 0
<TOTAL-REVENUES> 1,386,910
<CGS> 0
<TOTAL-COSTS> 1,223,825
<OTHER-EXPENSES> 103,386
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,614
<INCOME-PRETAX> 57,085
<INCOME-TAX> 21,978
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 35,107
<EPS-PRIMARY> .73
<EPS-DILUTED> .73
</TABLE>
