UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: October 30, 1999
Commission File Number: 0-3713
NATIONAL COMPUTER SYSTEMS, INC.
- - -----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Minnesota 41-0850527
- - ------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
11000 Prairie Lakes Drive
Eden Prairie, Minnesota 55344
- - ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (612)829-3000
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 and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practicable date:
The number of shares of common stock, par value $.03 per share,
outstanding on December 2, 1999 was 32,004,960.
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
NATIONAL COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
FOR THE PERIODS ENDED OCTOBER 30, 1999 AND OCTOBER 31, 1998
Third Quarter Year-to-Date
------------------- -------------------
(In thousands, except per share amounts)
1999 1998 1999 1998
-------- -------- -------- --------
REVENUES
Information services $ 91,408 $ 71,586 $260,573 $193,868
Product sales 54,312 50,305 147,537 128,370
Maintenance and support services 17,200 13,517 48,291 39,213
-------- -------- -------- --------
Total revenues $162,920 $135,408 $456,401 $361,451
COST OF REVENUES
Cost of information services 71,999 58,484 190,990 145,466
Cost of product sales 19,174 21,204 56,445 54,699
Cost of maintenance and
support services 10,724 8,345 29,648 25,112
-------- -------- -------- --------
Gross margin 61,023 47,375 179,318 136,174
OPERATING EXPENSES
Sales and marketing 17,613 16,594 53,154 48,174
Research and development 5,229 3,478 13,642 8,194
General and administrative 21,958 14,468 62,483 41,296
-------- -------- -------- --------
INCOME FROM OPERATIONS 16,223 12,835 50,039 38,510
Interest expense 158 193 586 726
Other (income) expense, net (3) (216) 322 89
-------- -------- -------- --------
INCOME BEFORE INCOME TAXES 16,068 12,858 49,131 37,695
Income taxes 6,500 5,100 19,750 15,100
-------- -------- -------- --------
NET INCOME $ 9,568 $7,758 $ 29,381 $ 22,595
======== ======== ======== ========
EARNINGS PER SHARE
Basic $ 0.30 $ 0.25 $ 0.93 $ 0.73
Diluted $ 0.29 $ 0.24 $ 0.89 $ 0.70
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 31,784 31,075 31,659 30,959
Diluted 33,151 32,648 33,011 32,474
See Notes to Consolidated Financial Statements.
<PAGE>
NATIONAL COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (unaudited)
October 30, January 31,
1999 1999
----------- -----------
(In thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 33,047 $ 16,310
Receivables 124,443 128,751
Inventories:
Finished products 5,910 5,096
Scoring services and work in process 23,924 14,442
Raw materials and purchased parts 5,779 2,253
-------- --------
Total inventories 35,613 21,791
Prepaid expenses and other 9,898 7,225
-------- --------
TOTAL CURRENT ASSETS 203,001 174,077
PROPERTY, PLANT AND EQUIPMENT
Land, buildings and improvements 67,602 63,018
Machinery and equipment 182,169 152,414
Accumulated depreciation (126,947) (109,416)
-------- --------
Net property, plant and equipment 122,824 106,016
INTELLECTUAL PROPERTIES, NET
Acquired and internally developed
software products 10,119 12,170
Educational content and
assessment instruments 23,998 8,835
-------- --------
Total intellectual properties 34,117 21,005
OTHER ASSETS, NET
Goodwill 56,441 52,840
Other assets 8,680 8,533
-------- --------
Total other assets 65,121 61,373
-------- --------
TOTAL ASSETS $425,063 $362,471
======== ========
See Notes to Consolidated Financial Statements.
<PAGE>
NATIONAL COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (unaudited)
October 30, January 31,
1999 1999
----------- -----------
(In thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current maturities of long-term debt $ 2,004 $ 3,758
Accounts payable 34,674 35,809
Accrued expenses 70,300 51,779
Deferred income 48,553 32,209
Income taxes 1,307 3,883
-------- --------
TOTAL CURRENT LIABILITIES 156,838 127,438
LONG-TERM DEBT -- less current maturities 5,179 5,597
DEFERRED INCOME TAXES 6,417 2,570
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' EQUITY
Preferred stock - -
Common stock--issued and outstanding -
31,946 and 31,467 shares, respectively 957 944
Paid-in capital 15,491 10,760
Retained earnings 245,233 220,625
Accumulated other comprehensive income -
Foreign currency translation adjustment (2,960) (3,880)
Deferred compensation (2,092) (1,583)
-------- --------
TOTAL STOCKHOLDERS' EQUITY 256,629 226,866
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $425,063 $362,471
======== ========
See Notes to Consolidated Financial Statements.
<PAGE>
NATIONAL COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
FOR THE PERIODS ENDED OCTOBER 30, 1999 AND OCTOBER 31, 1998
Year-to-Date
------------------------
1999 1998
-------- --------
(In thousands)
OPERATING ACTIVITIES
Net income $ 29,381 $ 22,595
Depreciation, amortization and other
noncash expenses 28,219 24,271
Provision for deferred income taxes (785) (1,265)
Changes in operating assets and liabilities:
Accounts receivable 6,405 6,573
Inventory and other current assets (16,249) (6,616)
Accounts payable and accrued expenses 13,208 9,879
Deferred income 12,618 4,688
-------- --------
Net cash provided by operating activities 72,797 60,125
INVESTING ACTIVITIES
Purchases of property, plant and equipment (25,459) (16,688)
Purchases of business systems (6,443) (5,429)
Acquisitions, net (19,034 (15,760)
Other, net (330) (2,225)
-------- --------
Net cash used in investing activities (51,266) (40,102)
FINANCING ACTIVITIES
Net repayment of borrowings (1,072) (6,025)
Issuance of common stock, net 1,051 549
Dividends paid (4,773) (4,670)
-------- --------
Net cash used by financing activities (4,794) (10,146)
-------- --------
Increase in cash and cash equivalents 16,737 9,877
CASH AND CASH EQUIVALENTS - beginning of period 16,310 23,267
-------- --------
CASH AND CASH EQUIVALENTS - end of period $ 33,047 $ 33,144
======== ========
See Notes to Consolidated Financial Statements.
<PAGE>
NATIONAL COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A - The accompanying unaudited Consolidated Financial Statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (which include only normal recurring adjustments)
necessary to present fairly the consolidated financial position, results of
operations and cash flows for all periods presented have been made. The
consolidated results of operations for the period ended October 30, 1999 are not
necessarily indicative of the operating results that may be expected for the
entire fiscal year ending January 29, 2000. For further information, refer to
the Consolidated Financial Statements and footnotes thereto included in the
National Computer Systems, Inc. and Subsidiaries' Annual Report on Form 10-K for
the year ended January 31, 1999.
Note B - Effective February 1, 1999, the Company adopted a 4-4-5, 13-week
quarterly accounting cycle with the fiscal year ending on the Saturday nearest
to January 31. The four fiscal quarters in the current year will end on May 1,
1999, July 31, 1999, October 30, 1999 and January 29, 2000. The impact of this
change in the Company's quarterly and annual financial results in 1999 will be
insignificant.
Note C - The following table is a reconciliation of the earnings numerator and
the weighted-average shares denominator used in the calculations of basic and
diluted earnings per share (in thousands, except per share data):
Third Quarter Year-to-Date
-------------------- ------------------
1999 1998 1999 1998
--------- --------- -------- --------
Earnings:
Net income for
basic earnings per share $ 9,568 $ 7,758 $29,381 $22,595
Adjustments for dilutive securities:
Interest expense on convertible
debentures, net of tax 42 56 126 161
------- ------- ------- -------
Adjusted net income for diluted
earnings per share $ 9,610 $ 7,814 $29,507 $22,756
======= ======= ======= =======
Weighted Average Share:
Basic average shares 31,784 31,075 31,659 30,959
Adjustments for dilutive securities:
Employee stock options, net of
tax proceeds 959 971 933 923
Contingent stock awards, net of
tax proceeds 25 94 33 83
Convertible debentures 383 508 386 509
------- ------- ------- -------
Diluted average shares 33,151 32,648 33,011 32,474
======= ======= ======= =======
Basic earnings per share $ 0.30 $ 0.25 $ 0.93 $ 0.73
======= ======= ======= =======
Diluted earnings per share $ 0.29 $ 0.24 $ 0.89 $ 0.70
======= ======= ======= =======
Note D - The Company has 10,000,000 shares of $.01 par value Preferred Stock
authorized of which none is outstanding. 100,000,000 shares of $.03 par value
Common Stock are authorized.
Note E - The components of comprehensive income for the 1999 and 1998 third
quarter and year-to-date are as follows (in thousands):
Third Quarter Year-to-Date
------------------ ----------------
1999 1998 1999 1998
------ ------ ------ ------
Net income $ 9,568 $ 7,758 $29,381 $22,595
Foreign currency translation
adjustments (200) (872) (920) (1,633)
------ ------ ------ ------
Comprehensive income $ 9,368 $ 6,886 $28,461 $20,962
======= ======= ======= =======
Note F - As previously disclosed, the Company was served with a summons and
complaint in a lawsuit filed against the Company by a former customer. The
lawsuit alleges certain claims against the Company in connection with certain
loan processing and servicing agreements and seeks out-of-pocket damages, lost
profits and compensation for extraordinary defaults and lost interest that it
claims resulted from breaches of these agreements by the Company. The customer
also seeks to have the Company acquire certain student loans with unpaid
principal, interest and late charges, which loans it claims are, or have been,
in default and were incorrectly processed or serviced by the Company. The
Company has tendered the defense of the claims to its insurer and the insurer
accepted the defense subject to a reservation of rights. The Company has filed
an answer to the complaint denying the claims, and the Company intends to
vigorously defend against the lawsuit. In addition, the Company has filed a
counterclaim against the former customer and a corporate affiliate seeking
compensatory damages and contribution and indemnity. The Company does not
believe that the outcome of this litigation would result in a material adverse
effect on the Company's consolidated financial position or results of
operations.
Note G - On May 28, 1999 the Company acquired NovaNET Learning, Inc. (NovaNET),
an interactive, online curriculum content company. The transaction has been
accounted for as a purchase, and, accordingly, NovaNET's operations subsequent
to the closing date are consolidated with the Company's. The purchase price was
$19.0 million in cash and has been primarily allocated to educational content
($16.3 million), goodwill ($7.1 million) and deferred taxes ($4.6 million) in
accordance with SFAS 109, Accounting for Income Taxes. The transaction is
expected to add approximately $15 million to revenues and be slightly accretive
to consolidated earnings of the Company in fiscal 1999.
Note H - The Company has five reportable business segments; the table below
presents information by segment.
<TABLE>
<CAPTION>
Assessments Education Data
& Testing Software & NCS Collection
Services Services Services Systems International Totals
----------- ----------- ---------- ---------- -------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Third Quarter Ended 10/30/99
Revenues $ 51,211 $ 42,182 $29,146 $24,902 $15,479 $162,920
Income from operations 2,847 7,744 4,221 8,268 1,491 24,571
Third Quarter Ended 10/31/98
Revenues $ 46,041 $ 33,073 $22,207 $23,576 $10,511 $135,408
Income from operations 3,390 3,480 2,397 7,669 770 17,706
Year-to-Date through 10/30/99
Revenues $137,068 $114,989 $98,380 $67,555 $38,409 $456,401
Income from operations 22,175 14,647 14,503 19,244 3,469 74,038
Year-to-Date through 10/31/98
Revenues $118,131 $ 81,173 $66,636 $62,311 $33,200 $361,451
Income from operations 20,585 6,596 6,914 15,484 2,202 51,781
</TABLE>
The difference for Income from operations between segment totals and the
Company's consolidated totals consist of central general and administrative
expenses and non-operating expenses, none of which are allocated to the
segments.
<PAGE>
Item 2. Management's Discussion and Analysis of Results of Operations and
Financial Condition
National Computer Systems, Inc. is a global information services company
providing software, services and systems for the collection, management and
interpretation of data. The Company markets these products and services to the
education, commercial, and government markets through its five operating
segments.
Recap of 1999 Third Quarter Results
For the quarter ended October 30, 1999, total revenues increased by $27.5
million or 20.3% from the quarter ended October 31, 1998. Overall gross margin
increased 2.5% as a percent of revenue, and gross margin dollars increased $13.6
million or 28.8%. Income from operations increased $3.4 million or 26.4%. Net
income increased 23.3%, and earnings per share (diluted) increased 20.8% to $.29
per share from $.24 in the prior year third quarter.
On a year-to-date basis, total revenues increased by $95.0 million or 26.3% over
the same period in the prior year. Overall gross margin increased 1.6% as a
percent of revenue, and gross margin dollars increased $43.1 million or 31.7%.
Income from operations year-to-date increased $11.5 million or 29.9%. Net income
increased 30.0%, and earnings per share (diluted) increased 27.1% to $.89 per
share from $.70 in the prior year.
Revenues
Increases in revenues for the three-month and year-to-date periods ended October
30, 1999 and October 31, 1998 by revenue category were as follows:
Quarter Year-to-date
------- ------------
Information services +27.7% +34.4%
Product sales + 8.0% +14.9%
Maintenance and support services +27.2% +23.2%
Overall +20.3% +26.3%
Of the $27.5 million of overall revenue increase in the third quarter of 1999,
72% was attributable to growth in information services (70% of $95.0 million
year-to-date). For both the third quarter and year-to-date, growth came from
several sources: assessment and testing services, government and commercial
outsourcing, and professional services related to education software.
Third quarter increases in product sales came principally from education
software licensing, with increased sales in existing products and the NovaNET
acquisition offsetting a third quarter decline in network hardware sales.
Increased maintenance and support services revenues were also the result of
increased support revenues from education software.
By major market, for the third quarter, revenues grew 18% from the education
market and 28% from the large scale data management (non-education) market. On a
year-to-date basis, the increases were 27% from education and 25% from
non-education.
Cost of Revenues and Gross Margins
For the third quarter the Company's overall gross margin as a percent of revenue
increased by 2.5%, with improvement in each revenue category (information
services, product sales, and maintenance and support services) in dollars and as
a percentage of revenue, except for a minor decrease in the gross margin percent
for maintenance and support services revenues. This improvement reflects
increased efficiency of service and product delivery at higher volumes.
Similarly, positive variances were seen in gross margins related to each revenue
category on a year-to-date basis, both in dollars and percentages.
Operating Expenses
Sales and marketing expenses increased $1.0 million or 6.1% in the quarter ended
October 30, 1999, over the prior year third quarter. As a percentage of
revenues, third quarter sales and marketing expenses declined by 1.4 percentage
points, due primarily to the relatively lower selling costs associated with
information services revenues. On a year-to-date basis, these expenses grew
10.3%, but decreased 1.7 percentage points as a percentage of revenue,
reflecting the same trend as in the third quarter.
Research and development costs increased $1.8 million to $5.2 million (or 50%)
in the quarter ended October 30, 1999 as compared to the prior year (and
increased 66% on a year-to-date basis), reflecting more research and development
spending in several areas, but particularly in test processing technology and
education software products. For the full year, these expenses are expected to
continue at higher levels for fiscal 1999 than fiscal 1998, as the Company
continues these investments.
General and administrative expenses increased $7.5 million for the quarter ended
October 30, 1999 from the prior year quarter. As a percentage of revenue,
general and administrative expense increased 2.8 percentage points from 10.7% to
13.5%. On a year-to-date basis the increase was $21.2 million, from 11.4% of
revenues to 13.7%. These expenses increased due to general growth and costs
related to an improvement of the Company's employee benefit package
(particularly vacation), variable compensation accrued because of favorable
operating results, increases in internal management information systems, and the
NovaNET acquisition.
Non-operating Expenses
Interest expense for both the third quarter and year-to-date decreased due to
lower average borrowing levels. Other expense, net, was insignificant for all
periods presented.
Provision for Income Taxes
The effective income tax rate was a constant 40% for all periods presented.
Liquidity and Capital Resources
For the nine-month period ended October 30, 1999, the Company generated $72.8
million of cash flow from operating activities as compared to $60.1 million in
the same period of the prior year. Cash was used principally to fund the NovaNET
acquisition of $19.0 million, investments in property, plant and equipment of
$25.5 million and business systems of $6.4 million, and to pay dividends of $4.8
million. The Company expects for the remainder of fiscal 1999 that its positive
cash flows from operations will be adequate to fund its normal financing and
investing activities. In addition, the Company generally anticipates funding
internal growth and acquisitions with its cash and cash equivalents on hand,
excess cash flows from operations, and an existing revolving credit facility.
Impact of Year 2000
Many currently installed computer systems and software are coded to accept only
two-digit entries in the date code fields. These date code fields will need to
accept four-digit entries to distinguish 21st century dates from 20th century
dates. This problem could result in system failures or miscalculations causing
disruptions of business operations (including, among other things, a temporary
inability to process transactions, send invoices or engage in other similar
business activities). As a result, many companies' computer systems and software
will need to be upgraded or replaced in order to comply with Year 2000
requirements. The potential global impact of the Year 2000 problem is not known,
and, if not corrected in a timely manner, could affect the Company and the U.S.
and world economy generally.
The Company's product development processes have included Year 2000 compliance
verification for all current and future products. The Company believes all of
its currently supported products are Year 2000 compliant.
The Company has a full-time Year 2000 program leader and a team (consisting of
representatives from each of its business units) to address internal and
external Year 2000 issues. The Company's internal financial and other "IT"
computer systems have been reviewed to assess and remediate Year 2000 problems,
as have other "non-IT" systems such as security, HVAC and telephone systems. In
addition, executive management regularly monitors the status of the Company's
Year 2000 remediation plans. The Company's Year 2000 compliance program has
included the following phases: identifying systems with date sensitive points
that will need to be addressed; carrying out remediation work to modify those
systems or convert to new systems; conducting validation testing of systems and
applications to ensure compliance; and transition preparedness activities. As of
October 30, 1999, the Company believes its Year 2000 effort is substantially
complete, with the exception of transition activities described below.
Through October 30, 1999, the Company has spent approximately $6.5 million
addressing Year 2000 issues ($1.5 million in fiscal 1997, $3.3 million in fiscal
1998, and $1.7 million thus far in fiscal 1999.) The Company expects to incur an
additional $0.3 million of Year 2000 expenses during the remainder of fiscal
1999. These costs are below original estimates and consist primarily of internal
resources, with relatively minor external costs. All amounts are being expensed
currently and are included in the Company's future operating plans and
expectations. In addition, the Company has also made, and will continue to make,
significant capital investments to enhance its internal business and service
delivery systems. However, these investments are not driven principally by Year
2000 considerations.
The Company has requested assurances from its major suppliers that they are
addressing the Year 2000 issue and that products purchased by the Company from
such suppliers will function properly in the Year 2000. Also, contacts have been
made with the Company's major customers. These actions are intended to help
mitigate the possible external impact of the Year 2000 problem. However, it is
impossible to fully assess the potential consequences to the Company of the Year
2000 problem in the event service interruptions from suppliers occur or in the
event that there are disruptions in such infrastructure areas as utilities,
communications, transportation, banking and government.
The Company believes it will not experience any material disruption as a result
of Year 2000 problems in internal processes, information processing or
interfaces with major customers, or with processing orders and billing. However,
if certain critical third-party providers, such as those providers supplying
electricity, water or telephone service, experience difficulties resulting in
disruption of service to the Company, a shutdown of the Company's operations at
individual facilities could occur for the duration of the disruption. While the
Company currently believes such disruptions of basic services and facility
shutdowns are unlikely, there can be no absolute assurance that they will not
occur.
The Company believes that the most likely worst case Year 2000 scenario will be
that NCS products do not operate properly for customers who have not installed
Year 2000 compliant versions of NCS products or have not updated their own
computing platform or network infrastructure to be operational in the Year 2000.
The Company has developed, and continues to refine, transition preparedness
plans to respond to a significantly increased number of customer calls at all
its support locations to address these Year 2000 problems. The Company has also
developed contingency plans to provide for continuity of processing in Year 2000
based on the outcome of its validation phase of its Year 2000 compliance program
and the results of surveying its major suppliers and customers. Assuming no
major disruption in service from utility companies or other critical third-party
providers, the Company believes that it will be able to manage its total Year
2000 transition without any material effect on the Company's consolidated
results of operations or financial condition.
The statements which are not historical or current facts or are "goals" or
"expectations" contained in this report constitute "forward-looking" statements,
as defined in the Private Securities Litigation Reform Act of 1995 and are
subject to certain risks and uncertainties that could cause actual results to
differ materially. The Cautionary Statements filed by the Company as Exhibit 99
to the Annual Report on Form 10-K for the year ended January 31, 1999, are
incorporated herein by reference, and stockholders and prospective investors are
specifically referred to such Cautionary Statements for a discussion of factors
which could affect the Company's operations and forward-looking statements
contained herein.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
27. Financial Data Schedule
(b) No reports on Form 8-K were filed for the three months ended October
30, 1999.
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.
NATIONAL COMPUTER SYSTEMS, INC.
/s/ Jeffrey W. Taylor
---------------------------
Jeffrey W. Taylor
Vice President and
Chief Financial Officer
Dated: December 10, 1999
<PAGE>
FORM 10-Q
NATIONAL COMPUTER SYSTEMS, INC.
FOR THE QUARTERLY PERIOD ENDED OCTOBER 30, 1999
EXHIBIT INDEX
EXHIBIT
27 Financial Data Schedule.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary information extracted from the financial
statements for National Computer Systems, Inc. and Subsidiaries, for
the fiscal year ended January 29, 2000, and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-29-2000
<PERIOD-START> AUG-01-1999
<PERIOD-END> OCT-30-1999
<EXCHANGE-RATE> 1
<CASH> 33047
<SECURITIES> 0
<RECEIVABLES> 124443
<ALLOWANCES> 0
<INVENTORY> 35613
<CURRENT-ASSETS> 9898
<PP&E> 249772
<DEPRECIATION> (126947)
<TOTAL-ASSETS> 425063
<CURRENT-LIABILITIES> 156838
<BONDS> 0
0
0
<COMMON> 957
<OTHER-SE> 255671
<TOTAL-LIABILITY-AND-EQUITY> 425063
<SALES> 54312
<TOTAL-REVENUES> 162920
<CGS> 35138
<TOTAL-COSTS> 101897
<OTHER-EXPENSES> 44800
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 158
<INCOME-PRETAX> 16068
<INCOME-TAX> 6500
<INCOME-CONTINUING> 9568
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9568
<EPS-BASIC> 0.30
<EPS-DILUTED> 0.29
</TABLE>
