<PAGE>
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 June 30, 1996 or
-------------
[ ] Transition report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934 for the transition
period from_____________to ____________
Commission file number 0-14232
SunGard(R) Data Systems Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 51-0267091
- ----------------------------------- ------------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1285 Drummers Lane, Wayne, Pennsylvania 19087
-----------------------------------------------------
(Address of principal executive offices, including zip code)
(610) 341-8700
----------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
-- --
There were 42,117,119 shares of the registrant's common stock, par value $.01
per share, outstanding at June 30, 1996.
<PAGE>
SUNGARD DATA SYSTEMS INC.
AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Balance Sheets as of June 30, 1996
(unaudited) and December 31, 1995 . . . . . . . . . . . . . . 1
Consolidated Statements of Income for the six and three
months ended June 30, 1996 and 1995 (unaudited) . . . . . . . 2
Supplemental Income Statement Information for the six and
three months ended June 30, 1996 and 1995 (unaudited) . . . . 2
Consolidated Statements of Cash Flows for the six and three
months ended June 30, 1996 and 1995 (unaudited) . . . . . . . 3
Notes to Consolidated Financial Statements (unaudited). . . . 4
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operation. . . . . . . . . . . . . . . . . . . 5
PART II. OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . 9
Item 2. Changes in Securities . . . . . . . . . . . . . . . . . . . . 9
Item 3. Defaults upon Senior Securities . . . . . . . . . . . . . . . 9
Item 4. Submission of Matters to a Vote of Security Holders . . . . . 9
Item 5. Other Information . . . . . . . . . . . . . . . . . . . . . . 10
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . 10
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
- ----------------------------
SUNGARD DATA SYSTEMS INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
JUNE 30,
1996 DECEMBER 31,
(UNAUDITED) 1995
-------------- --------------
<S> <C> <C>
ASSETS
Current:
Cash and equivalents. . . . . . . . . . . . . . $ 106,800 $ 79,091
Short-term investments, at cost, which
approximates market. . . . . . . . . . . . . . 11,323 36,066
Trade receivables, less allowance for doubtful
accounts of $10,589 and $6,426 . . . . . . . . 108,878 118,169
Earned but unbilled receivables . . . . . . . . 22,023 25,090
Prepaid expenses and other current assets . . . 22,962 16,020
Deferred income taxes . . . . . . . . . . . . . 9,248 6,727
-------------- --------------
Total current assets. . . . . . . . . . . . . 281,234 281,163
Property and equipment, less accumulated
depreciation of $141,972 and $126,580. . . . . . 97,497 95,745
Software products, less accumulated amortization
of $64,783 and $59,033 . . . . . . . . . . . . . 33,023 35,375
Goodwill, less accumulated amortization of
$22,311 and $19,658. . . . . . . . . . . . . . . 122,840 116,455
Other intangible assets, less accumulated
amortization of $33,808 and $27,015. . . . . . . 62,996 50,996
-------------- --------------
$ 597,590 $ 579,734
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current:
Short-term and current portion of long-term
debt . . . . . . . . . . . . . . . . . . . . . $ 3,098 $ 6,761
Accounts payable. . . . . . . . . . . . . . . . 8,907 12,428
Accrued compensation and benefits . . . . . . . 23,553 29,330
Other accrued expenses. . . . . . . . . . . . . 17,651 15,773
Accrued income taxes. . . . . . . . . . . . . . 10,462 10,639
Deferred revenues . . . . . . . . . . . . . . . 70,970 72,642
-------------- --------------
Total current liabilities . . . . . . . . . . 134,641 147,573
-------------- --------------
Long-term debt. . . . . . . . . . . . . . . . . . 3,290 3,241
-------------- --------------
Deferred income taxes . . . . . . . . . . . . . . 4,514 6,628
-------------- --------------
Committments. . . . . . . . . . . . . . . . . . .
Stockholders' equity:
Preferred stock, par value $.01 per share;
5,000 shares authorized. . . . . . . . . . . . -- --
Common stock, par value $.01 per share; 60,000
shares authorized; 42,229 and 42,111 shares
issued . . . . . . . . . . . . . . . . . . . . 422 421
Capital in excess of par value. . . . . . . . . 174,323 171,558
Notes receivable for common stock . . . . . . . (930) (2,817)
Restricted stock plans. . . . . . . . . . . . . (1,777) (220)
Retained earnings . . . . . . . . . . . . . . . 288,218 260,172
Foreign currency translation adjustment . . . . (1,123) (1,279)
-------------- --------------
459,133 427,835
Treasury stock, at cost, 112 and 189 shares . . (3,988) (5,543)
-------------- --------------
Total stockholders' equity. . . . . . . . . . 455,145 422,292
-------------- --------------
$ 597,590 $ 579,734
============== ==============
</TABLE>
See accompanying notes
1
<PAGE>
SUNGARD DATA SYSTEMS INC.
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
------------------ -------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues . . . . . . . . . . . $305,366 $246,609 $155,568 $125,119
-------- -------- -------- --------
Costs and expenses:
Cost of sales and direct
operating . . . . . . . . . 136,761 111,772 69,525 56,066
Sales, marketing and
administration. . . . . . . 61,410 51,354 30,507 25,844
Product development. . . . . 26,857 21,437 13,678 11,146
Depreciation of property and
equipment . . . . . . . . . 17,636 14,481 9,041 7,398
Amortization of intangible
assets. . . . . . . . . . . 13,857 10,601 7,045 5,305
-------- -------- -------- --------
256,521 209,645 129,796 105,759
-------- -------- -------- --------
Income from operations . . . . 48,845 36,964 25,772 19,360
Interest income, net . . . . 3,005 2,593 1,486 1,347
-------- -------- -------- --------
Income before income taxes . . 51,850 39,557 27,258 20,707
Income taxes . . . . . . . . 20,999 16,218 11,039 8,489
-------- -------- -------- --------
Net income . . . . . . . . . . $ 30,851 $ 23,339 $ 16,219 $ 12,218
======== ======== ======== ========
Fully diluted net income per
common share. . . . . . . . . $ 0.72 $ 0.61(1) $ 0.38 $ 0.32(1)
======== ======== ======== ========
Shares used to compute fully
diluted net income per common
share . . . . . . . . . . . . 42,981 38,348(1) 43,091 38,392(1)
======== ======== ======== ========
</TABLE>
SUNGARD DATA SYSTEMS INC.
SUPPLEMENTAL INCOME STATEMENT INFORMATION
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
------------------- --------------------
1996 1995 1996 1995
-------- -------- -------- ---------
<S> <C> <C> <C> <C>
Revenues:
Investment support systems . . $184,926 $154,516 $ 92,192 $ 77,476
Disaster recovery services . . 90,508 77,352 47,039 40,235
Computer services and other. . 29,932 14,741 16,337 7,408
-------- -------- -------- --------
$305,366 $246,609 $155,568 $125,119
======== ======== ======== ========
Income from operations:
Investment support systems . . $ 30,718 $ 25,352 $ 15,159 $ 11,720
Disaster recovery services . . 19,011 12,941 10,265 7,864
Computer services and other. . 3,104 2,345 2,446 1,263
Corporate administration . . . (3,988) (3,674) (2,098) (1,487)
-------- -------- -------- --------
$ 48,845 $ 36,964 $ 25,772 $ 19,360
======== ======== ======== ========
Operating margin:
Investment support systems . . 16.6% 16.4% 16.4% 15.1%
======== ======== ======== ========
Disaster recovery services . . 21.0% 16.7% 21.8% 19.5%
======== ======== ======== ========
Computer services and other. . 10.4% 15.9% 15.0% 17.0%
======== ======== ======== ========
Total. . . . . . . . . . . . . 16.0% 15.0% 16.6% 15.5%
======== ======== ======== ========
</TABLE>
(1) Adjusted to reflect two-for-one stock split which occurred in July 1995.
See accompanying notes
2
<PAGE>
SUNGARD DATA SYSTEMS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
-----------------------
1996 1995
---------- ---------
<S> <C> <C>
Cash flow from operations:
Net income . . . . . . . . . . . . . . . . . . $ 30,851 $ 23,339
Reconciliation of net income to cash flow from
operations:
Depreciation and amortization . . . . . . . 31,493 25,082
Charges for stock option and award plans . . 974 1,012
Other noncash charges (credits) . . . . . . 282 98
Deferred income tax benefit . . . . . . . . (4,635) (1,586)
-------- --------
58,965 47,945
Cash provided by (used for) working capital, net
of effect of acquired businesses:
Accounts receivable and other current assets . 5,759 (553)
Accounts payable and accrued expenses . . . . (7,710) (8,786)
Deferred revenues . . . . . . . . . . . . . . (3,682) (6,561)
-------- --------
Cash flow from operations . . . . . . . . . 53,332 32,045
-------- --------
Financing activities:
Cash received under employee stock plans . . . 5,697 2,878
Cash paid for treasury stock . . . . . . . . . (4,423) (3,608)
Repayments of debt . . . . . . . . . . . . . . (3,994) (4,379)
-------- --------
Total financing activities . . . . . . . . . (2,720) (5,109)
-------- --------
Long-term investment activities:
Cash paid for acquired businesses, net of cash
acquired. . . . . . . . . . . . . . . . . . . (28,129) (3,512)
Cash paid for property and equipment . . . . . (16,717) (13,861)
Cash paid for software and other assets . . . (2,800) (2,395)
-------- --------
Total long-term investment activities . . . (47,646) (19,768)
-------- --------
Increase in cash and equivalents before
short-term investment activities. . . . . . . . 2,966 7,168
Short-term investment activities:
Purchase of short-term investments . . . . . . (2,660) (42,722)
Maturities of short-term investments . . . . . 27,403 25,519
-------- --------
Increase (decrease) in cash and equivalents . . 27,709 (10,035)
Beginning cash and equivalents . . . . . . . . . 79,091 68,491
-------- --------
Ending cash and equivalents . . . . . . . . . . $106,800 $ 58,456
======== ========
Supplemental information:
Acquired businesses:
Property and equipment . . . . . . . . . . . 2,676 60
Software products . . . . . . . . . . . . . 765 1,237
Goodwill and other intangible assets . . . . 26,496 3,307
Purchase price obligations and debt assumed -- (240)
Net current liabilities assumed . . . . . . (1,808) (852)
-------- --------
Cash paid for acquired businesses, net of cash
acquired . . . . . . . . . . . . . . . . . . . $ 28,129 $ 3,512
======== ========
</TABLE>
See accompanying notes
3
<PAGE>
SUNGARD DATA SYSTEMS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. The accompanying consolidated financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions for Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the six and three
month periods ended June 30, 1996 are not necessarily indicative of the
results that may be expected for the year ending December 31, 1996. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Company's annual report on Form 10-K for
the year ended December 31, 1995.
2. On July 10, 1996, the Company completed the acquisition of NCS Financial
Systems, Inc., a subsidiary of National Computer Systems, Inc., for a cash
payment of $95.0 million, of which $5.0 million was paid before June 30,
1996.
The Company has engaged a nationally recognized, independent appraisal firm
to express an opinion on the fair market value of the assets acquired to
serve as the basis of allocation of the purchase price to the various
classes of assets acquired. While this appraisal has not yet been completed,
the Company expects to record a charge against third quarter 1996 earnings
for that portion of the purchase price related to acquired in-process
research and development. Acquired in-process research and development
represents the value of software products still in development and not
considered to have reached technological feasibility as of the date of
acquisition.
On April 26, 1996, the Company completed the acquisition of the disaster
recovery business of Digital Equipment Corporation. The acquisition
consisted primarily of contract rights, computer equipment and a
non-competition agreement. The acquisition is not expected to have a
material effect upon the financial condition or results of operations of the
Company.
3. Fully diluted net income per common share was calculated using the
weighted-average number of common shares and common-equivalent shares
outstanding during the period. Common-equivalent shares are principally
attributable to unexercised stock options.
4
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Statements about the Company's expectations and all other statements in
this quarterly report on Form 10-Q other than historical facts are
forward-looking statements. Since these statements involve risks and
uncertainties and are subject to change at any time, the Company's actual
results could differ materially from expected results. The Company derives most
of its forward-looking statements from its operating budgets and forecasts,
which are based upon many detailed assumptions. While the Company believes that
its assumptions are reasonable, it cautions that there are inherent difficulties
in predicting certain important factors, especially the timing and magnitude of
software sales, the timing and magnitude of technological advances, the
performance of recently acquired businesses, the prospects for future
acquisitions, and the overall condition of the financial services industry.
These factors, as and when applicable, are discussed in the Company's filings
with the Securities and Exchange Commission, including its most recent Form
10-K, a copy of which may be obtained from the Company without charge.
INCOME FROM OPERATIONS:
Investment Support Systems (ISS):
The Company's ISS business is comprised of more than twenty operating units
of various sizes and complexities. Historically, most operating units have met
or exceeded expectations, while some have not, yielding overall results for the
entire business at approximately the levels expected. Since overall ISS results
reflect the sum of the diverse results of individual operating units, there
could be an adverse impact on ISS revenues and margins if too many individual
units are unable to meet expectations.
The ISS operating margin was 16.6% and 16.4% for the six and three month
periods ended June 30, 1996. The Company expects that the full-year 1996
operating margin will be between 16% and 17%, consistent with the full-year ISS
operating margins for the last three years. The most important factors
affecting the ISS operating margin continue to be the timing and magnitude of
software sales, the performance of recently acquired businesses and the level of
spending on product development.
Disaster Recovery Services (DRS):
The DRS operating margin increased during the six and three month periods
ended June 30, 1996 compared to the corresponding periods in 1995, due primarily
to an increase in revenues and the timing and magnitude of equipment
expenditures. The Company expects the timing and magnitude of expenditures for
equipment and facilities upgrades to be spread throughout 1996, compared with
1995, when such expenditures were more heavily concentrated during the first
half of the year.
The Company expects that the full-year 1996 DRS operating margin will
remain the same as in 1995. The most important factors affecting the DRS
operating margin continue to be the rate of new contract signings, contract
renewals, and timing and magnitude of equipment and facilities expenditures, as
well as the level of acquisition activity.
5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
(Continued)
INCOME FROM OPERATIONS, CONTINUED:
Computer Services and Other (CS):
The decline in the CS operating margin during the six and three month periods
ended June 30, 1996 compared to the corresponding periods in 1995 is due to the
initial effect of the 1995 acquisitions of Intelus Corporation and MACESS
Corporation, partially offset by an increase in the operating margin in the
Company's remote-access computer processing and automated mailing services
businesses.
The Company expects that the CS operating margin will improve for the
full-year 1996 compared to 1995. The most important factors affecting the CS
operating margin are the performance of recently acquired businesses, which are
highly dependent upon the timing and magnitude of software license revenues, and
revenue growth in remote-access computer processing and automated mailing
services businesses.
REVENUES:
Total revenues for the six and three month periods ended June 30, 1996
increased $58.8 million, or 24%, and $30.4 million, or 24%, respectively,
compared to the corresponding periods in 1995. Excluding acquired businesses,
revenues increased $22.5 million, or 9%, and $10.7 million, or 9%, during the
six and three month periods compared to the corresponding periods in 1995.
Recurring revenues derived from remote processing, disaster recovery and
software maintenance services are approximately $243.0 million and $204.6
million for the six month periods ended June 30, 1996 and 1995, respectively,
representing 80% and 83% of consolidated revenues, respectively. The decline in
the percentage of recurring revenues during 1996 is due to an increase in the
percentage of software license revenues, which increased to 11% of total
revenues during the six month period ended June 30, 1996, compared to 9% of
total revenues during the corresponding period in 1995. This increase was due
primarily to continued growth in software license revenues in the Trading
Systems Group and acquired businesses, partially offset by declines in software
license revenues in the Company's Financial Systems and Trust and Shareholder
Systems Groups. The Company expects that the percentage of recurring revenues
will be approximately 80% for the full-year 1996.
The Company sells a significant portion of its products and services to the
financial services industry and could be directly affected by the overall
condition of that industry. The Company expects that the consolidation trend in
the financial services industry will continue, but it is unable to predict what
effect, if any, this trend may have.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
(Continued)
REVENUES, CONTINUED:
Investment Support Systems:
ISS revenues for the six and three month periods ended June 30, 1996
increased $30.4 million, or 20%, and $14.7 million, or 19%, respectively,
compared to the corresponding periods in 1995. Excluding acquired businesses,
revenues increased $9.2 million, or 6%, and $4.1 million, or 5%, during the six
and three month periods ended June 30, 1996, compared to the corresponding
periods in 1995. Excluding acquired businesses, the increases are attributable
to increases in data processing and software maintenance revenues of $7.2
million and $2.6 million, respectively, and increases in software license and
professional services revenues of $2.0 million and $1.5 million, respectively.
Disaster Recovery Services:
DRS revenues for the six and three month periods ended June 30, 1996
increased $13.2 million, or 17%, and $6.8 million, or 17%, respectively,
compared to the corresponding periods in 1995. Excluding acquired businesses,
revenues increased $11.4 million, or 15%, and $5.4 million, or 13%, during the
six and three month periods ended June 30, 1996, compared to the corresponding
periods in 1995. The increases are attributable primarily to increases in
revenues resulting from new contract signings and contract renewals, a
significant portion of which were in the Company's midrange platforms.
Computer Services and Other:
CS revenues for the six and three month period ended June 30, 1996
increased $15.2 million, or 103%, and $8.9 million, or 121%, respectively,
compared to the corresponding periods in 1995. Excluding acquired businesses,
revenues increased $1.9 million, or 13%, and $1.1 million, or 15%, respectively,
compared to the corresponding periods in 1995. These increases are due to
increased volume in the Company's remote-access computer processing business.
COSTS AND EXPENSES:
Cost of sales and direct operating expenses for the six and three month
periods ended June 30, 1996 increased $25.0 million, or 22%, and $13.4 million,
or 24%, respectively, compared to the corresponding periods in 1995. The
increases are due primarily to acquired businesses. As a percentage of
revenues, cost of sales and direct operating expenses were relatively stable at
45%.
Sales, marketing and administration expenses for the six and three month
periods ended June 30, 1996 increased $10.0 million, or 20%, and $4.7 million,
or 18%, respectively, compared to the corresponding periods in 1995. The
increases are due primarily to acquired businesses and an increase in sales
activity, particularly in the DRS Group. As a percentage of revenues, sales,
marketing and administrative expenses declined from approximately 21% to 20%.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
(Continued)
COSTS AND EXPENSES, CONTINUED:
Product development expenses for the six and three month periods ended June
30, 1996 increased $5.4 million, or 25%, and $2.5 million, or 23%, respectively,
compared to the corresponding periods in 1995. The increases are due primarily
to acquired businesses and an increase in development spending in connection
with various ISS products. Development costs capitalized were $1.6 million and
$1.1 million for the six and three months ended June 30, 1996, respectively,
compared with $1.1 million and $0.7 million for the six and three months ended
June 30, 1995, respectively.
Depreciation of property and equipment for the six and three month periods
ended June 30, 1996 increased $3.1 million, or 22%, and $1.6 million, or 22%,
respectively, compared to the corresponding periods in 1995. The increases are
due primarily to acquired businesses and purchases of equipment and facility
improvements.
Net interest income for the six month period ended June 30, 1996 increased
$0.4 million, or 16%, compared to the corresponding period in 1995 due primarily
to an increase in average cash and investment balances, and, to a lesser extent,
an increase in overall interest rates. Net interest income will decline during
the balance of 1996 due to the recently completed acquisition of NCS Financial
Systems, Inc. for $95.0 million in cash.
The Company's effective income tax rate was 40.5% and 41.0% during the six
and three month periods ended June 30, 1996 and 1995, respectively. The small
decline in the 1996 effective income tax rate is due primarily to nondeductible
intangible asset amortization remaining relatively constant, while income before
income taxes is increasing.
LIQUIDITY AND CAPITAL RESOURCES:
At June 30, 1996, cash and short-term investments increased $2.9 million to
$118.1 million from $115.2 million at December 31, 1995. Shortly after the end
of the second quarter, the Company completed the acquisition of NCS Financial
Systems, Inc. Total cash paid for the acquisition was $95.0 million, of which
$5.0 million was paid in June 1996. Cash equivalents and short-term investments
are invested primarily in institutional money-market funds, short-term municipal
bonds, and highly rated, investment-grade corporate bonds. By policy, the
Company places its investments with institutions of high credit-quality and
limits the amount of credit exposure to any one issuer.
Cash flow from operations increased during the six month period ended June
30, 1996 to $53.3 million from $32.0 million during the comparable period in
1995. The increase was due to an $11.0 million increase in cash flow from
operations before working capital changes, and a $10.3 million improvement in
working capital. The Company spent $16.7 million for property and equipment
during the six months ended June 30, 1996, and expects that capital spending for
the full-year 1996 will increase to approximately $37.0 million from $31.7
million during 1995.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
(Continued)
LIQUIDITY AND CAPITAL RESOURCES, CONTINUED:
The expected increase is due to spending by recently acquired businesses, and
replacement and improvement of equipment and facilities.
The Company expects that its existing cash resources and cash generated
from operations will be sufficient for the foreseeable future to meet its
operating requirements, contingent payments in connection with previously
acquired businesses, and ordinary capital spending needs. As a result of the
recently completed acquisition of NCS Financial Systems, Inc., the Company is
currently negotiating a new $75.0 million line of credit to replace its existing
$25.0 million line of credit. The Company believes that it has the capacity to
borrow funds and use equity to finance additional capital needs.
PART II. Other Information
ITEM 1. LEGAL PROCEEDINGS: None
ITEM 2. CHANGES IN SECURITIES: None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES: None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
(a) The 1996 Annual Meeting of Stockholders of the
registrant was held on May 10, 1996.
(b) At the 1996 Annual Meeting, the following were elected
as directors:
<TABLE>
<CAPTION>
FOR WITHHELD
--- --------
<S> <C> <C>
Gregory S. Bentley 34,429,405 35,313
Michael C. Brooks 34,429,535 35,183
Albert A. Eisenstat 34,426,735 37,983
Bernard Goldstein 34,426,390 38,328
James L. Mann 34,428,735 35,983
Michael Roth 34,428,605 36,113
Malcolm I. Ruddock 34,428,845 35,873
Lawrence J. Schoenberg 34,428,115 36,603
</TABLE>
9
<PAGE>
PART II. Other Information (Continued)
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
(Continued)
(c) (i) Approval of the Company's 1996 Equity Incentive Plan:
<TABLE>
<CAPTION>
<S> <C>
Votes in favor 23,882,775
Votes against 5,892,478
Votes abstaining 117,265
Broker non-votes 4,572,200
</TABLE>
(ii) Approval of the Company's 1996 Employee Stock Purchase
Plan:
<TABLE>
<CAPTION>
<S> <C>
Votes in favor 29,638,160
Votes against 207,705
Votes abstaining 46,653
Broker non-votes 4,572,200
</TABLE>
ITEM 5. OTHER INFORMATION: None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:
(a) Exhibits:
27.1 Financial Data Schedule.
(b) Reports on Form 8-K:
Form 8-K, dated May 30, 1996, filed on June 7, 1996, relating
to the Company's entering into a definitive agreement to
acquire NCS Financial Systems, Inc., a subsidiary of National
Computer Systems, Inc.
10
<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.
SUNGARD DATA SYSTEMS INC.
Date: August 14, 1996 By: /s/Michael J. Ruane
--------------------------------
Michael J. Ruane
Vice President-Finance and Chief Financial Officer
(Principal Financial Officer)
11
<PAGE>
LIST OF EXHIBITS
NUMBER EXHIBIT
- ------ -------
27.1 Financial Data Schedule.
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED CONSOLIDATED BALANCE SHEET OF SUNGARD DATA SYSTEMS INC. AS OF JUNE 30,
1996 AND THE UNAUDITED CONSOLIDATED STATEMENT OF INCOME FOR THE SIX MONTHS ENDED
JUNE 30, 1996, INCLUDED IN THE FORM 10-Q OF SUNGARD DATA SYSTEMS INC. FOR THE
QUARTERLY PERIOD ENDED JUNE 30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCES TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 106,800
<SECURITIES> 11,323
<RECEIVABLES> 141,490
<ALLOWANCES> 10,589
<INVENTORY> 0
<CURRENT-ASSETS> 281,234
<PP&E> 239,469
<DEPRECIATION> 141,972
<TOTAL-ASSETS> 597,590
<CURRENT-LIABILITIES> 134,641
<BONDS> 3,290
0
0
<COMMON> 422
<OTHER-SE> 454,723
<TOTAL-LIABILITY-AND-EQUITY> 597,590
<SALES> 0
<TOTAL-REVENUES> 305,366
<CGS> 0
<TOTAL-COSTS> 195,111<F1>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 51,850
<INCOME-TAX> 20,999
<INCOME-CONTINUING> 30,851
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 30,851
<EPS-PRIMARY> 0.72
<EPS-DILUTED> 0.72
<FN>
<F1>EXCLUDES SELLING, MARKETING AND ADMINISTRATIVE COSTS
</FN>
</TABLE>
