<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1999 Commission File Number 1-7516
KEANE, INC.
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 04-2437166
(State or other jurisdictions of (I.R.S. Employer Identification
incorporation or organization) Number)
Ten City Square, Boston, Massachusetts 02129
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 241-9200
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 March 31, 1999, the number of issued and outstanding shares of Common
Stock (excluding 315,893 shares held in treasury) and Class B Common stock are
71,387,924 and 285,213 shares, respectively.
Page 1 of 16
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Keane, Inc. and Subsidiaries
TABLE OF CONTENTS
Part I - Financial Information
Consolidated Statements of Income for the three months ended
March 31, 1999 and 1998 .............................................. 3
Consolidated Balance Sheets as of March 31, 1999 and
December 31, 1998 .................................................... 4
Consolidated Statements of Cash Flows for the three months ended
March 31, 1999 and 1998 .............................................. 5
Notes to Unaudited Financial Statements .............................. 6
Management's Discussion and Analysis of Financial Condition and
Results of Operations ................................................ 8
Part II - Other Information .......................................... 15
Signature Page ....................................................... 16
Page 2 of 16
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Keane, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)
<TABLE>
<CAPTION>
(In thousands except per share amounts)
Three months ended March 31,
1999 1998
-------- --------
<S> <C> <C>
Total revenues $285,004 $230,056
Salaries, wages and other direct costs 183,894 149,570
Selling, general and administrative expenses 49,583 41,518
Amortization of goodwill and other intangible assets 1,976 1,644
-------- --------
Operating income 49,551 37,324
Interest and dividend income 1,835 1,212
Interest expense -- 49
Other expenses, net 239 187
-------- --------
Income before income taxes 51,147 38,300
Provision for income taxes 20,969 15,516
-------- --------
Net income $ 30,178 $ 22,784
======== ========
Net income per share (basic) $ .42 $ .32
======== ========
Net income per share (diluted) $ .42 $ .32
======== ========
Weighted average common shares outstanding (basic) 71,553 70,611
======== ========
Weighted average common and common share equivalents outstanding
(diluted) 72,392 72,062
======== ========
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
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Keane, Inc. and Subsidiaries
Consolidated Balance Sheets (unaudited)
<TABLE>
<CAPTION>
(In thousands)
March 31, 1999 December 31, 1998
-------------- -----------------
<S> <C> <C>
Assets
Current:
Cash and cash equivalents $ 49,875 $ 51,696
Short term investments 2,857 6,165
Accounts receivable, net:
Trade 255,487 229,457
Other 5,431 1,573
Prepaid expenses and other current assets 18,154 23,376
--------- ---------
Total current assets 331,804 312,267
Long-term investments 76,131 71,368
Property and equipment, net 29,372 29,973
Intangible assets, net 37,103 35,714
Other assets, net 8,584 8,238
--------- ---------
$ 482,994 $ 457,560
========= =========
Liabilities
Current:
Accounts payable $ 18,104 $ 20,222
Accrued expenses and other liabilities 15,822 30,647
Accrued compensation 24,656 25,429
Notes payable 1,500 1,000
Accrued income taxes 20,213 13,548
Current capital lease obligations 930 954
--------- ---------
Total current liabilities 81,225 91,800
Long-term portion of capital lease obligations 1,959 1,976
Stockholders' Equity
Common stock 7,171 7,136
Class B common stock 29 29
Additional paid-in capital 115,372 109,606
Foreign currency translation (622) (764)
Retained earnings 280,724 250,546
Less treasury stock (2,864) (2,769)
--------- ---------
Total stockholders' equity 399,810 363,784
--------- ---------
$ 482,994 $ 457,560
========= =========
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
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Keane, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
(In thousands)
Three Months ended March 31,
Cash flows from Operating Activities: 1999 1998
-------- --------
<S> <C> <C>
Net Income $ 30,178 $ 22,784
Adjustments to reconcile net income to net cash used for
operating activities:
Depreciation and amortization 5,845 4,288
Deferred income taxes (1,473) (1,706)
Provision for doubtful accounts (1,968) 1,632
Changes in assets and liabilities, net of acquisitions:
Increase in accounts receivable (27,393) (46,110)
Decrease in prepaid expenses and other assets 6,510 564
Decrease in accounts payable and accrued expenses and other
liabilities (18,116) (1,830)
Increase in income taxes payable 6,665 13,691
-------- --------
Net cash provided by (used for) operating activities 248 (6,687)
-------- --------
Cash flows from Investing Activities:
Purchase of investments (17,828) (17,653)
Sale of investments 16,373 12,874
Purchase of property and equipment (3,100) (4,724)
Proceeds from the sale of property and equipment 2 5
Payments for current acquisitions (3,181) (295)
-------- --------
Net cash used for investing activities (7,734) (9,793)
-------- --------
Cash flows from Financing Activities:
Payments under long-term debt -- (2,850)
Principal payments under capital lease obligations (41) (87)
Proceeds from issuance of common stock 5,706 2,472
Dividends paid -- (210)
-------- --------
Net cash provided by (used for) financing activities 5,665 (675)
-------- --------
Net (decrease) in cash and cash equivalents (1,821) (17,155)
Cash and cash equivalents at beginning of period 51,696 40,276
-------- --------
Cash and cash equivalents at end of period $ 49,875 $ 23,121
======== ========
</TABLE>
The accompanying notes are an integral part of
the consolidated financial statements.
Page 5 of 16
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Keane, Inc. and Subsidiaries
Notes to Unaudited Financial Statements
Note 1. The accompanying unaudited consolidated financial statements
have been prepared in accordance with the accounting policies
described in the Company's Annual Report on Form 10-K for the year
ended December 31, 1998 (the "Annual Report") and should be read in
conjunction with the disclosures therein. All financial figures are in
thousands of dollars, except per share amounts. Prior period amounts
have been restated to conform to current year presentation.
In the opinion of management, these interim financial statements
reflect all adjustments, consisting of normal recurring accruals,
necessary to present fairly the financial position, results of
operations and cash flows for the periods presented. Interim results
are not necessarily indicative of results for the full year.
During 1998, the Company completed five acquisitions. Four of the
acquisitions were accounted for as poolings-of-interests and one was
accounted for as a purchase. The accompanying financial statements and
notes have been restated for all periods presented for the three
material pooling-of-interests acquisitions.
Note 2. Computation of Earnings Per Share for quarters ending March 31, 1999
and 1998.
<TABLE>
<CAPTION>
Three Months Ended March 31,
1999 1998
------- -------
<S> <C> <C>
Net income $30,178 $22,784
Weighted average number of
common shares outstanding used in
calculation of basic earnings per share 71,553 70,611
Incremental shares from the assumed
exercise of dilutive stock options 839 1,451
Weighted average number of
common shares outstanding used in
calculation of diluted earnings per
share 72,392 72,062
Earnings per share
Basic $ .42 $ .32
======= =======
Diluted $ .42 $ .32
======= =======
</TABLE>
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Keane, Inc. and Subsidiaries
Notes to Unaudited Financial Statements
Note 3. Intangible assets consist of the following: 3/31/99 12/31/98
Goodwill $27,060 $23,695
Noncompetition agreements 1,000 2,268
Customer-based intangibles 44,436 44,501
Software 2,534 5,618
Other -- 273
------- -------
75,030 76,355
Less accumulated amortization 37,927 40,641
------- -------
$37,103 $35,714
======= =======
Page 7 of 16
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Keane, Inc. and Subsidiaries
Management's Discussion and Analysis of Financial Condition and
Results of Operations
This Quarterly Report on Form 10-Q contains forward-looking statements. For this
purpose, any statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. Without limiting the
foregoing, the words "believes," "anticipates," "plans," "expects," and similar
expressions are intended to identify forward-looking statements. There are a
number of important factors that could cause the Company's actual results to
differ materially from those indicated by such forward-looking statements. These
factors include, without limitation, those set forth below under the caption
"Certain Factors That May Affect Future Results."
Results of Operations
The Company's revenue for the first quarter of 1999 was $285.0 million, a 23.9%
increase from $230.1 million in the first quarter of 1998. Commencing with the
first quarter of 1999, Keane intends to categorize its information technology
revenue as either plan, build or manage. First quarter 1999 revenue from the
Company's planning services was $26.1 million, up 36.6% from planning services
revenue for the first quarter last year of $19.1 million. Plan revenue is
primarily comprised of management consulting revenue focused on operations
improvements. First quarter 1999 revenue from the Company's build services was
$81.0 million, a 35.7% increase from the first quarter 1998 revenue of $59.7
million. Build revenue primarily consists of implementing e-solutions, Customer
Relationship Management systems, data-warehousing services, application
development and licensing and implementing the Company's proprietary suite of
hospital application products. First quarter 1999 revenue from the Company's
manage services was $171.9 million, up 13.6% from the first quarter 1998 manage
revenue of $151.3 million. Manage revenue primarily consists of application
outsourcing, help desk and application maintenance and support. Of the
Company's' first quarter 1999 manage revenue, Year 2000 compliance services
totaled $80.0 million in the first quarter of 1999 compared to $74.4 million in
the first quarter of 1998. The Company expects its Year 2000 compliance revenue
to gradually decrease over the next two years, but anticipates that revenue from
the Company's other strategic service offerings will increase as companies that
have completed their Year 2000 compliance projects will be able to concentrate
on other strategic IT development needs. All other revenue for the first quarter
of 1999 totaled $6.0 compared to $0 for the first quarter last year.
Salaries, wages and other direct costs for the first quarter of 1999 were $183.9
million, or 64.5% of revenue, compared to $149.6 million, or 65.0% of revenue,
for the first quarter of 1998, for a 0.5% decrease as a percentage of revenue.
This decrease as a percentage of revenue was primarily due to the Company's
ability to increase its billing rates over its increases in direct labor costs
in 1999. This is due primarily to the Company's increase in client strategic
services in which competition is less and the quality of services commands
higher billing rates.
Selling, General & Administrative ("SG&A") expenses for the first quarter of
1999 were $49.6 million, or 17.4% of revenue, compared to $41.5 million, or
18.0% of revenue, for the first quarter last year, for a 0.6% decrease as a
percentage of revenue. The Company's objective is to continue to reduce SG&A, as
a percentage of revenue, by realizing economies of scale, investing in MIS to
increase productivity, and continuing to implement cost saving programs such as
national purchasing for volume purchase discounts in such areas as travel,
office supplies, and computer equipment.
Page 8 of 16
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Amortization of goodwill and other intangible assets for the first quarter of
1999 was $2.0 million, or 0.7% of revenue, compared to $1.6 million, or 0.7% of
revenue in the first quarter of 1998. The increase in amortization was
attributable to the increase in intangible assets as a result of the acquisition
of GSE Erudite in April 1998.
Interest and dividend income totaled $1.8 million for the first quarter of 1999,
compared to $1.2 million for the same period last year. The increase in interest
and dividend income can be attributed to an increase in investments. Interest
and other expenses for the first quarter of each of 1999 and 1998 totaled $0.2
million.
Pre-tax income for the first quarter of 1999 was $51.1 million, or 17.9% of
revenue, up 33.5% from pre-tax income of $38.3 million, or 16.6% of revenue, in
the first quarter of 1998.
The Company's effective tax rate for the first quarter of 1999 was 41.0%
compared to 40.5% for the first quarter of 1998.
Net income and earnings per share for the first quarter of 1999 were $30.2
million and $0.42 per share diluted, respectively, compared to $22.8 million and
$0.32 per share diluted, respectively for the first quarter last year.
Liquidity and Capital Resources
The Company ended the first quarter of 1999 with cash and investments totaling
approximately $129.0 million, the same as the 1998 year end balance and up $59.0
million from the first quarter of 1998. The Company maintains and has available
a $20 million unsecured demand line of credit split equally between two major
Boston banks.
Based on the Company's current operating plan, it believes that its cash and
cash equivalents on hand, cash flows from operations, and its current available
line of credit will be sufficient to meet its current working capital
requirements during at least the next twelve months.
Impact of Inflation and Changing Prices
Inflationary increases in costs have not been material in recent years and, to
the extent permitted by competitive pressures, are passed on to the clients
through increased billing rates. Rates charged by the Company are based on the
cost of labor and market conditions within the industry. The Company was able to
increase its billing rates over its increases in direct labor costs in 1999.
This is due primarily to the Company's increase in client strategic services in
which competition is less and the quality of services commands higher rates.
Year 2000 Issues
Overview
The "Year 2000" issue is the result of computer programs being written using two
digits rather than four to define the applicable year. Keane's computer
equipment and software and devices with embedded technology that are time
sensitive may recognize "00" as the year 1900 rather than the Year 2000. This
could result in a system failure or miscalculations causing disruptions of
Keane's operations, including,
Page 9 of 16
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among other things, a temporary inability to perform mission critical functions
like billing and time reporting. As a result, software and computer systems may
need to be upgraded or replaced in order to ensure that they accept four digit
date codes.
State of Readiness
Company Services and Products. Keane generally delivers services and not
- ------------------------------
products to its customers. The Company believes that the services provided by
its professionals to its customers are provided in a Year 2000 compliant manner.
As part of its build services, Keane develops, markets and sells software
products through its Healthcare Solutions Practice. Certain of these products
are not fully Year 2000 operable. Keane has advised its customer base for these
products that it does not intend to offer Year 2000 compliant versions of these
products and has encouraged them to migrate to new products offered by Keane
that are Year 2000 compliant. The Company anticipates that some customers will
choose not to migrate to these products and will therefore terminate their
relationship with Keane's Healthcare Solutions Practice. The exact amount of
anticipated lost customers has not been determined. The Company believes that
the revenue lost as a result of these events will be immaterial to its overall
operations.
In addition to its own products, Keane markets certain third party software
products through its Healthcare Solutions Practice. The Company is seeking
assurances from the vendors of these products that all licensed software is Year
2000 compliant. The Company received substantially all of these assurances in
the first quarter of 1999.
Company Systems. Keane has established a Year 2000 task force that has completed
- ----------------
its assessment of the Company's Information Technology-related ("IT- related")
systems for the Year 2000 issue. For IT-related systems, the Company believes
that most of the critical systems, including its accounting software, AS400
applications and payroll systems, are now Year 2000 compliant. The Company is in
the process of replacing its billing software because the current software
product is not Year 2000 compliant. The cost to replace this software is
currently estimated to be approximately $500,000. Keane believes that the new
software will be operational by the end of the second quarter of 1999.
Keane's Year 2000 task force has also completed its evaluation of the Company's
non-IT systems, including alarm systems, sprinkler systems, elevators, fax
machines and other miscellaneous systems that may contain embedded technology,
for the Year 2000 Issue during the first quarter of 1999. Keane has established
a remediation plan to address any outstanding Year 2000 Issues concerning the
Company's non-IT systems.
Costs to Address Year 2000 Issues
Keane anticipates that it will incur direct costs to modify or replace existing
systems used by Keane in the operation of its business to ensure that all
systems will be operable in the Year 2000, including the costs to replace its
billing software described above. The Company believes that the total amounts
spent by it to date and that it expects to spend in 1999 addressing the Year
2000 issue are not material.
Page 10 of 16
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Risks to the Company
In the event of a failure of some or all of the Company's IT-related and non-IT
systems on January 1, 2000, the Company's operations may be substantially
curtailed until the Company or its third-party suppliers develop a solution to
address such system's failure. In such event, the Company may be unable to: (a)
perform billing functions, (b) keep track of time performed on projects for its
clients, (c) access client records, (d) communicate between field offices and
headquarters, (e) operate its Internet site, (f) receive and send email or (g)
prepare its financial statements for the fourth quarter of 1999 or periods
thereafter.
Among the services that Keane provides are assessment, planning,
migration/remediation and testing services for Year 2000 compliance. Keane has
devoted significant resources to services that address the Year 2000 problem and
believes the market for these services will decline as the Year 2000 approaches.
Although Keane believes that the demand for its services relating to the Year
2000 problem will continue to exist after the Year 2000, this demand will
diminish significantly over time and will eventually disappear.
Keane's services addressing the Year 2000 problem involve key aspects of its
clients' computer systems. A failure in a client's system could result in a
claim for substantial damages against Keane, regardless of Keane's
responsibility for the failure. Keane could incur substantial costs in
connection with any resulting litigation, regardless of the outcome.
Contingency Plans
As described above, the Company has identified potential vulnerabilities
associated with the change of the century. The Company is devoting resources to
working with providers of systems to the Company to ensure that its business is
not substantially interrupted as a result of the date change. The Company
currently does not have a contingency plan in the event of a particular system
not being Year 2000 compliant. Such a plan will be developed if it becomes clear
that the company is not going to achieve its scheduled compliance objectives.
Certain Factors that May Affect Future Results
- ----------------------------------------------
The following important factors, among others, could cause actual results to
differ materially from those indicated by forward-looking statements made in
this Annual Report on Form 10-K and presented elsewhere by management from time
to time.
Fluctuations in Operating Results. Keane has experienced and expects to continue
- ----------------------------------
to experience fluctuations in its quarterly results. Keane's gross margins vary
based on a variety of factors including employee utilization rates and the
number and type of services performed by Keane during a particular period. A
variety of factors influence Keane's revenue in a particular quarter, including:
general economic conditions which may influence investment decisions
or cause downsizing;
the number and requirements of client engagements;
employee utilization rates;
Page 11 of 16
<PAGE>
changes in the rates Keane can charge clients for services;
acquisitions; and
other factors, many of which are beyond Keane's control.
A significant portion of Keane's expenses do not vary relative to revenue. As a
result, if revenue in a particular quarter does not meet expectations, Keane's
operating results could be materially adversely affected, which in turn may have
a material adverse impact on the market price of Keane common stock. In
addition, many of Keane's engagements are terminable without client penalty. An
unanticipated termination of a major project could result in an increase in
underutilized employees and a decrease in revenue and profits.
Risks Relating to Acquisitions. In the past five years, Keane has grown
- -------------------------------
significantly through acquisitions. Since January 1, 1998, Keane has completed
the acquisitions of Quantum Associates, Inc. d/b/a Omega Systems in Pittsburgh,
Pennsylvania, GSE Erudite Systems in Salt Lake City, Utah, Bricker & Associates,
Inc. in Chicago, Illinois, Icom Systems Ltd in Birmingham, England, Fourth Tier,
Inc. in El Segundo, California, Emergent Corporation in San Mateo, California,
Advanced Solutions Inc. in New York, New York, Amherst Consulting Group, Inc. in
Boston, Massachusetts and Parallax Solutions Ltd in the United Kingdom. Keane's
future growth may be based in part on selected acquisitions. At any given time,
Keane may be in various stages of considering such opportunities. Keane can
provide no assurances that it will be able to find and identify desirable
acquisition targets or that it will be successful in entering into a definitive
agreement with any one target. Also, even if a definitive agreement is reached,
there is no assurance that any future acquisition will be completed.
Keane typically anticipates that each acquisition will bring certain benefits,
such as an increase in revenue. Prior to completing an acquisition, however, it
is difficult to determine if such benefits can actually be realized.
Accordingly, there is a risk that an acquired company may not achieve an
increase in revenue or other benefits for Keane. In addition, an acquisition may
result in unexpected costs and expenses. Any of these events could have a
material adverse effect on Keane's business, financial condition and results of
operations.
The process of integrating acquired companies into Keane's existing business may
also result in unforeseen difficulties. Unforeseen operating difficulties may
absorb significant management attention which Keane might otherwise devote to
its existing business. Also, the process may require significant financial
resources that Keane might otherwise allocate to other activities, including the
ongoing development or expansion of Keane's existing operations. Finally, future
acquisition could result in Keane having to incur additional debt and/or
contingent liabilities. All of these possibilities might have a material adverse
effect on Keane's business, financial condition and result of operations.
Dependence on Personnel. Keane believes that its future success will depend in
- ------------------------
large part on its ability to continue to attract and retain highly-skilled
technical and management personnel. The competition for such personnel is
intense. Keane may not succeed in attracting and retaining the personnel
necessary to develop its business. If Keane does not, its business, financial
condition and result of operations could be materially adversely affected.
Highly Competitive Market. The market for Keane's services is highly
- --------------------------
competitive. The technology for custom software services can change rapidly. The
market is fragmented, and no company holds a
Page 12 of 16
<PAGE>
dominant position. Consequently, Keane's competition for client assignments and
experienced personnel varies significantly from city to city and by the type of
service provided. Some of Keane's competitors are larger and have greater
technical, financial and marketing resources and greater name recognition in the
markets they serve than does Keane. In addition, clients may elect to increase
their internal information systems resources to satisfy their custom software
development needs.
Keane believes that in order to compete successfully in the software services
industry it must be able to:
compete cost-effectively;
develop strong client relationships;
generate recurring revenues;
utilize comprehensive delivery methodologies; and
achieve organizational learning by implementing standard operational
processes.
Keane may not be able to compete successfully against current or future
competitors. In addition, competitive pressures faced by Keane may materially
adversely affect its business, financial condition and results of operations.
Year 2000 Compliance; Risks Associated with Provision of Year 2000 Services.
- ----------------------------------------------------------------------------
Keane has reviewed its internal computer systems and has identified certain
internal systems that are not Year 2000 compatible (i.e., such systems use only
two digits to represent the year in date data fields and, consequently, may not
accurately distinguish between the 20th and 21st centuries or may not function
properly at the turn of the century). Keane is in the process of correcting
these systems or replacing them with Year 2000 compliant systems. Keane expects
to implement successfully the systems and programming changes necessary to
address Year 2000 issues and does not believe that the cost of such actions will
have a material effect on Keane's financial condition or results of operations.
There may, however, be a delay in, or increased costs associated with, the
implementation of these changes. Keane's inability to implement changes could
have a material adverse effect on Keane's business, financial condition or
results of operations.
Among the services that Keane provides are assessment, planning,
migration/remediation and testing services for Year 2000 compliance. Keane has
devoted significant resources to services that address the Year 2000 problem and
believes the market for these services will decline as the Year 2000 approaches.
Although Keane believes that the demand for its services relating to the Year
2000 problem will continue to exist after the Year 2000, this demand will
diminish significantly over time and will eventually disappear.
Keane's services addressing the Year 2000 problem involve key aspects of its
clients' computer systems. A failure in a client's system could result in a
claim for substantial damages against Keane, regardless of Keane's
responsibility for the failure. Keane could incur substantial costs in
connection with any resulting litigation, regardless of the outcome.
International Operations. Keane commenced operations in the United Kingdom with
- -------------------------
its acquisition of Icom Systems Ltd, now known as Keane Limited, in August 1998
and acquired Parallax Solutions Ltd in the United Kingdom in May 1999. Keane's
international operations will be subject to political and
Page 13 of 16
<PAGE>
economic uncertainties, currency exchange rate fluctuations, foreign exchange
restrictions, changes in taxation and other difficulties in managing operations
overseas. Keane may not be successful in its international operations.
As a result of these and other factors, the Company's past financial performance
should not be relied on as an indication of future performance. Keane believes
that period to period comparisons of its financial results are not necessarily
meaningful and it expects that results of operations may fluctuate from period
to period in the future.
Quantitative and Qualitative Disclosures About Market Risks. Market risks were
- ------------------------------------------------------------
reported in the Company's Annual Report on Form 10-K for the year ended December
31, 1998. There have been no material changes in these risks since the end of
the year.
Page 14 of 16
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Keane, Inc. and Subsidiaries
Part II - Other Information
- --------------------------------------------------------------------------------
Item 5. Other Information.
On May 3, 1999, the Company acquired Boston-based Amherst Consulting
Group, Inc., a privately-held management consulting firm specializing
in change management for cash.
On May 8, 1999, the Company acquired Parallax Solutions Ltd, a
software services consultancy based in Coventry England that helps
leading automotive, retail finance and capital market companies
develop business solutions using internet and advanced technologies
for cash and notes.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits - None
(b) Reports on Form 8-K - The registrant filed no reports on
Form 8-K during the quarter ended March 31, 1999.
Page 15 of 16
<PAGE>
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.
KEANE, INC.
(Registrant)
Date May 13, 1999 /s/ John F. Keane
------------ --------------------------------------------
John F. Keane
President
(Principal Executive Officer)
Date May 13, 1999 /s/ Wallace A. Cataldo
------------ --------------------------------------------
Wallace A. Cataldo
Vice President, Finance
(Principal Financial and Accounting Officer)
Page 16 of 16
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BALANCE
SHEET AND INCOME STATEMENT AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 49,875
<SECURITIES> 2,857
<RECEIVABLES> 260,918
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 331,804
<PP&E> 70,085
<DEPRECIATION> 40,713
<TOTAL-ASSETS> 482,994
<CURRENT-LIABILITIES> 81,225
<BONDS> 0
0
0
<COMMON> 7,171
<OTHER-SE> 392,639
<TOTAL-LIABILITY-AND-EQUITY> 482,994
<SALES> 0
<TOTAL-REVENUES> 285,004
<CGS> 0
<TOTAL-COSTS> 235,453
<OTHER-EXPENSES> 239
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 51,147
<INCOME-TAX> 20,969
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 30,178
<EPS-PRIMARY> .42
<EPS-DILUTED> .42
</TABLE>
