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 3, 1998
---------------------
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 0-15386
---------------------
CERNER CORPORATION
----------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 43-1196944
- - ---------------------------- --------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
2800 Rockcreek Parkway
Kansas City, Missouri 64117
(816) 221-1024
----------------------------------------------------------
(Address of Principal Executive Offices, including zip code;
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) with the
Commission, and (2) has been subject to such filing requirements for the
past 90 days.
Yes X No
------- ------
There were 32,787,504 shares of Common Stock, $.01 par value,
outstanding at October 3, 1998.
<PAGE>
CERNER CORPORATION AND SUBSIDIARIES
-----------------------------------
I N D E X
---------
Part I. Financial Information:
Item 1. Financial Statements:
Consolidated Balance Sheets as of October 3, 1998
and January 3, 1998 (unaudited) 1
Consolidated Statements of Earnings for the
three months and nine months ended October 3, 1998
and September 27, 1997 (unaudited) 2
Consolidated Statements of Cash Flows
for the nine months ended October 3, 1998
and September 27, 1997 (unaudited) 3
Notes to Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 5
Part II. Other Information:
Item 5. Other Information 9
Item 6. Exhibits and Reports on Form 8-K 9
<PAGE>
Part I. Financial Information
Item 1. Financial Statements
<TABLE>
CERNER CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<CAPTION>
October 3, January 3,
1998 1998
------------------------
(In thousands)
<S> <C> <C>
Assets
Current Assets:
Cash and cash equivalents $ 16,708 $ 7,541
Short-term investments 26,885 70,002
Receivables 156,700 125,516
Inventory 2,128 1,743
Prepaid expenses and other 4,589 3,553
---------- ----------
Total current assets 207,010 208,355
Property and equipment, net 71,308 65,724
Software development costs, net 50,816 40,566
Intangible assets, net 9,189 6,402
Noncurrent receivables 1,885 2,290
Other assets 8,110 8,444
---------- ----------
$ 348,318 $ 331,781
========== ==========
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $ 7,754 $ 11,330
Current installments of long-term debt 43 35
Advanced billings 3,378 8,290
Accrued income taxes 25,303 18,245
Accrued payroll and tax withholdings 13,559 11,610
Other accrued expenses 2,408 2,037
---------- ----------
Total current liabilities 52,445 51,547
---------- ----------
Long-term debt, net 29,995 30,026
Deferred income taxes 18,521 16,461
Stockholders' Equity:
Common stock, $.01 par value, 150,000,000
shares authorized, 33,989,022 shares issued
in 1998 and 33,816,829 issued in 1997 340 338
Additional paid-in capital 149,537 148,074
Retained earnings 118,661 106,273
Treasury stock, at cost (1,201,518 shares) (20,796) (20,796)
Accumulated other comprehensive income (385) (142)
---------- ----------
Total stockholders' equity 247,357 233,747
---------- ----------
$ 348,318 $ 331,781
========== ==========
</TABLE>
See notes to consolidated financial statements.
1
<PAGE>
<TABLE>
CERNER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
-------------------------------------------------
October 3, September 27, October 3, September 27,
-------------------------------------------------
(In thousands, except per share data)
1998 1997 1998 1997
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
System sales $ 60,395 $ 42,500 $ 171,987 $ 121,367
Support and maintenance 19,998 17,167 56,719 49,890
Other 2,439 1,110 6,952 3,969
--------- -------- --------- --------
Total revenues 82,832 60,777 235,658 175,226
--------- -------- --------- --------
Costs and expenses:
Cost of revenues 20,175 15,835 63,484 52,861
Sales and client service 30,172 20,743 84,231 59,798
Software development 15,611 12,034 43,820 32,250
General and administrative 6,544 5,508 18,999 16,216
Write-off of in process
research and development -- -- 5,038 --
--------- -------- --------- --------
Total costs and expenses 72,502 54,120 215,572 161,125
--------- -------- --------- --------
Operating earnings 10,330 6,657 20,086 14,101
Interest income (expense), net (145) 546 (69) 1,704
--------- -------- --------- --------
Earnings before income taxes 10,185 7,203 20,017 15,805
Income Taxes 3,837 2,758 7,629 6,099
--------- -------- --------- --------
Net earnings $ 6,348 $ 4,445 $ 12,388 $ 9,706
========= ======== ========= ========
Basic Earnings per share $ 0.19 $ 0.13 $ 0.38 $ 0.30
========= ======== ========= ========
Basic Weighted average shares outstanding 32,771 32,951 32,727 32,825
--------- -------- --------- --------
Diluted Earnings per share $ 0.19 $ 0.13 $ 0.37 $ 0.29
========= ======== ========= ========
Diluted Weighted average shares outstanding 33,740 34,507 33,575 33,923
--------- -------- --------- --------
</TABLE>
See notes to consolidated financial statements.
2
<PAGE>
<TABLE>
CERNER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
Nine Months Ended
---------------------------
October 3, September 27,
---------------------------
1998 1997
----------- ----------
(In thousands)
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 12,388 $ 9,706
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization 18,489 13,391
Issuance of stock as compensation -- 16
Write-off of acquired in-process
research and development 5,038 --
Equity in losses of investee companies 1,027 375
Provision for deferred income taxes 8,978 --
Loss on disposal of capital equipment 195 --
Changes in assets and liabilities:
Receivables (30,692) (9,318)
Inventory (385) (399)
Prepaid expenses and other (3,260) (1,090)
Accounts payable (3,717) (1,565)
Accrued income taxes -- 5,860
Other accrued liabilities (3,475) 695
-------- --------
Total adjustments (7,802) 7,965
-------- --------
Net cash provided by operating activities 4,586 17,671
-------- --------
Cash flows from investing activities:
Purchase of capital equipment (13,796) (11,345)
Acquisition of business (6,874) --
Investment of investee companies (817) (4,500)
Capitalized software development costs (18,235) (13,098)
-------- --------
Net cash used in investing activities (39,722) (28,943)
-------- --------
Cash flows from financing activities:
Repayment of long-term debt (36) (104)
Proceeds from exercise of options 1,465 890
Purchase of treasury stock -- (2,900)
-------- --------
Net cash provided by (used in) financing activities 1,429 (2,114)
-------- --------
Foreign currency translation adjustment (243) (112)
-------- --------
Net decrease in cash, cash equivalents, and
short-term investments (33,950) (13,498)
Cash, cash equivalents, and short-term investments
at beginning of period 77,543 110,902
-------- --------
Cash, cash equivalents, and short-term investments
at end of period $ 43,593 $ 97,404
======== =========
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
CERNER CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) Interim Statement Presentation
The consolidated financial statements included herein have
been prepared by the Company without audit, pursuant to the rules
and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in
annual financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company
believes that the disclosures are adequate to make the
information presented not misleading. It is suggested that these
consolidated financial statements be read in conjunction with the
consolidated financial statements and the notes thereto included
in the Company's latest annual report on Form 10-K.
In the opinion of management, the accompanying unaudited
consolidated financial statements include all adjustments
(consisting of only normal recurring accruals) necessary to
present fairly the financial position at October 3, 1998 and
January 3, 1998 and the results of operations and cash flows for
the periods presented. The results of the three-month and nine-
month periods are not necessarily indicative of the operating
results for the entire year.
The Company adopted Statement of Financial Accounting
Standards No. 130, "Reporting Comprehensive Income" as of January
4, 1998. This statement establishes requirements for reporting
and display of comprehensive income and its components. For the
nine months ended October 3, 1998 and September 27, 1997, total
Comprehensive Income, which includes foreign currency translation
adjustments, amounted to $12,145,000 and $9,594,000,
respectively.
(2) Earnings Per Share
Basic EPS excludes dilution and is computed by dividing
income available to common stockholders by the weighted-average
number of common shares outstanding for the period. Diluted EPS
reflects the potential dilution that could occur if securities of
other contracts to issue stock were exercised or converted into
common stock or resulted in the issuance of common stock that
then shared in the earnings of the entity.
(3) Acquisition of Business
On March 16, 1998, the Company purchased all of the
outstanding common stock of Multum Information Systems, Inc.,
(Multum) for $6.9 million. Multum is a supplier to the
healthcare industry of drug knowledge databases and intelligent
software components that improve the quality and cost-
effectiveness of medical care. The Company plans to incorporate
Multum's drug information and expert dosing component into its
Health Network Architecture Millennium solutions to enable
Multum's expert knowledge to become executable within the process
of care delivery.
The acquisition has been accounted for using the purchase
method of accounting with the operating results of Multum
included in the Company's consolidated statement of earnings
since the date of acquisition. Five million dollars of the
purchase price was allocated to in-process research and
development that had not reached technological feasibility and
was treated as a one-time charge to earnings reducing after tax
income for the nine month period ended October 3, 1998 by $3.1
million or $.09 per share on a diluted basis.
The allocation of the purchase price to the estimated fair
values of the identified tangible and intangible assets acquired
and liabilities assumed, resulted in goodwill of $1,581,000. The
goodwill is being amortized straight-line over seven years.
4
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
-----------------------------------------------------------
and Results of Operations
-------------------------
Results of Operations
- - ---------------------
Three Months Ended October 3, 1998 Compared to Three Months Ended
September 27, 1997
The Company's revenues increased 36% to $82,832,000 for the
three-month period ended October 3, 1998 from $60,777,000 for the
three-month period ended September 27, 1997. Net earnings
increased 43% to $6,348,000 in the 1998 period from $4,445,000
for the 1997 period.
System sales revenues increased 42% to $60,395,000 for the
three-month period ended October 3, 1998 from $42,500,000 for the
corresponding period in 1997. The increase in the system sales
revenue is due to an increase in revenue from HNA (Health Network
Architecture) contracts and increased revenue from stand-alone
contracts. The revenue from the sale of additional hardware and
software products to the installed client base increased 37% in
the third quarter of 1998 over the same period in 1997.
At October 3, 1998, the Company had $272,277,000 in contract
backlog and $146,328,000 in support and maintenance backlog,
compared to $171,156,000 in contract backlog and $128,194,000 in
support and maintenance backlog at September 27, 1997.
Support and maintenance revenues increased 16% to $19,998,000
during the third quarter of 1998 from $17,167,000 during the same
period in 1997. This increase was due primarily to the increase
in the Company's installed and converted client base.
Other revenues increased 120% to $2,439,000 in the third
quarter of 1998 from $1,110,000 in the same period of 1997. This
increase was due primarily to services performed beyond
contracted requirements for existing clients.
The cost of revenues includes the cost of computer hardware
and sublicensed software purchased from computer and software
manufacturers for delivery to clients. It also includes the cost
of hardware maintenance and sublicensed software support
subcontracted to manufacturers. The cost of revenue was 24% of
total revenues in the third quarter of 1998 and 26% of total
revenues in the comparable period in 1997. Such costs, as a
percent of revenues, typically have varied as the mix of revenue
(software, hardware, maintenance, and support) components
carrying different margin rates changes from period to period.
Sales and client service expenses include salaries of client
service personnel, communications expenses and unreimbursed
travel expenses. Also included are sales and marketing salaries,
trade show costs and advertising costs. These expenses as a
percent of total revenues were 36% and 34% in the third quarter
of 1998 and 1997, respectively. The increase in total sales and
client service expenses to $30,172,000 in 1998 from $20,743,000
in 1997 was attributable to the cost of a larger regional sales
and services organization and marketing of new products.
Software development expenses include salaries, documentation
and other direct expenses incurred in product development, as
well as amortization of software development costs. Total
expenditures for software development, including both capitalized
and noncapitalized portions, for the third quarter of 1998 and
1997 were $19,322,000 and $14,462,000, respectively. These
amounts exclude amortization of previously capitalized
expenditures. Capitalized software costs were $6,373,000 and
$4,352,000 for the third quarter of 1998 and 1997, respectively.
The increase in aggregate expenditures for software development
in 1998 was due to development of HNA Millennium products and
development of community care products.
General and administrative expenses include salaries for
corporate, financial, and administrative staffs, utilities,
communications expenses, and professional fees. These expenses
as a percent of total revenues were 8% and 9% in the third
quarter of 1998 and 1997, respectively. Total general and
administrative expenses for the third quarter of 1998 and 1997
were $6,544,000 and $5,508,000, respectively.
5
<PAGE>
Net interest income (expense) was ($145,000) in the third
quarter of 1998 compared to $546,000 for the same period in 1997.
This decrease is primarily due to a decrease in invested cash.
The Company's effective tax rate was 38% for the third
quarter of 1998 and 1997.
The Company's quarterly revenues and net earnings have
historically been variable and cyclical. The variability is
attributable primarily to the number and size of project
milestone events in any fiscal quarter. The Company expects
fluctuations in quarterly results to continue.
Nine Months Ended October 3, 1998 Compared to Nine Months Ended
September 27, 1997
The Company's revenues increased 34% to $235,658,000 for the
nine-month period ended October 3, 1998 from $175,226,000 for the
nine-month period ended September 27, 1997. Net earnings
increased 28% to $12,388,000 in the 1998 period from $9,706,000
for the 1997 period. Excluding a one-time write-off of in-
process research and development, net earnings would have
increased 60% to $15,486,000, relative to the 1997 period.
System sales revenues increased 42% to $171,987,000 for the
nine-month period ended October 3, 1998 from $121,367,000 for the
corresponding period in 1997. The increase in the system sales
revenue is due to an increase in revenue from HNA (Health Network
Architecture) contracts and an increase in revenue from stand-
alone contracts. The revenue from the sale of additional hardware
and software products to the installed client base increased 28%
in the first nine-months of 1998 over the same period in 1997.
At October 3, 1998, the Company had $272,277,000 in contract
backlog and $146,328,000 in support and maintenance backlog,
compared to $171,156,000 in contract backlog and $128,194,000 in
support and maintenance backlog at September 27, 1997.
Support and maintenance revenues increased 14% to $56,719,000
during the first nine months of 1998 from $49,890,000 during the
same period in 1997. This increase was due primarily to the
increase in the Company's installed and converted client base.
Other revenues increased 75% to $6,952,000 in the first nine
months of 1998 from $3,969,000 in the same period of 1997. This
increase was due primarily to services performed beyond
contracted requirements for existing clients.
The cost of revenues includes the cost of computer hardware
and sublicensed software purchased from computer and software
manufacturers for delivery to clients. It also includes the cost
of hardware maintenance and sublicensed software support
subcontracted to manufacturers. The cost of revenue was 27% of
total revenues in the first nine months of 1998 and 30% of total
revenues in the comparable period in 1997. Such costs, as a
percent of revenues, typically have varied as the mix of revenue
(software, hardware, maintenance, and support) components
carrying different margin rates changes from period to period.
Sales and client service expenses include salaries of client
service personnel, communications expenses and unreimbursed
travel expenses. Also included are sales and marketing salaries,
trade show costs and advertising costs. These expenses as a
percent of total revenues were 36% and 34% in the first nine
months of 1998 and 1997, respectively. The increase in total
sales and client service expenses to $84,231,000 in 1998 from
$59,798,000 in 1997 was attributable to the cost of a larger
regional sales and services organization and marketing of new
products.
Software development expenses include salaries, documentation
and other direct expenses incurred in product development, as
well as amortization of software development costs. Total
expenditures for software development, including both capitalized
and noncapitalized portions, for the first nine months of 1998
and 1997 were $54,070,000 and $39,496,000, respectively.
These amounts exclude amortization of previously capitalized
expenditures. Capitalized software costs were $18,235,000 and
$13,098,000 for the first nine months of 1998 and 1997,
respectively. The increase in aggregate expenditures for
software development in 1998 was due to development of HNA
Millennium products and development of community care products.
6
<PAGE>
General and administrative expenses include salaries for
corporate, financial, and administrative staffs, utilities,
communications expenses, and professional fees. These expenses
as a percent of total revenues were 8% and 9% in the first nine
months of 1998 and 1997, respectively. Total general and
administrative expenses for the first nine months of 1998 and
1997 were $18,999,000 and $16,216,000, respectively.
Write-off of in process research and development is a one-
time expense resulting from the acquisition of Multum.
Net interest income (expense) was ($69,000) in the first nine
months of 1998 compared to $1,704,000 for the same period in
1997. This decrease is primarily due to a decrease in invested
cash.
The Company's effective tax rates were 38% and 39% for the
first nine months of 1998 and 1997, respectively.
Capital Resources and Liquidity
- - -------------------------------
The Company's liquidity position remains strong with total
cash and cash equivalents of $16,708,000 and short term
investments of $26,885,000 at October 3, 1998 and working capital
of $154,565,000. The Company generated net cash from operations
of $4,586,000 and $17,671,000 during the nine month periods
ended October 3, 1998 and September 27, 1997, respectively. The
decrease in net cash from operations is due to the increase in
receivables from record revenues. The Company acquired Multum on
March 16, 1998 for $6.9 million. The Company has $18,000,000 of
long-term, revolving credit from banks, all of which was
available as of October 3, 1998.
Revenues provided under the Company's support and maintenance
agreements represent recurring cash flows. The Company's revenue
backlog at October 3, 1998 included $146,328,000 representing
twelve months of equipment maintenance and software support
associated with signed contracts.
The Company believes its present cash, cash equivalents and
short-term investment position, together with cash generated from
operations and available under its current bank borrowing
facility, will be sufficient to meet anticipated cash
requirements during the next twelve months.
Year 2000 Issues
- - ----------------
Computer programs that use two digits to identify a year may
fail or create errors in the year 2000, leading to system failures
or miscalculations causing disruptions to the operations of the
user. The Company has conducted a Year 2000 review of its operations
focusing on the Company's products and their use by its clients, the
computers, operating systems and data bases used in conjunction with
its products and the Company's internal operations.
Client
All versions of the Company's software products currently being
marketed are Year 2000 compliant. The costs incurred to make all
versions compliant have occurred in the ordinary course of software
development and enhancement have not been material. All of the
Company's clients using older versions of the Company's software
products are entitled to upgrade to the compliant versions with no
charge for the compliant version. However, some have elected not to
do so for a variety of reasons. The Company is working with the
clients who wish to upgrade to address Year 2000 issues. These
clients have either upgraded to compliant versions or are scheduled
to be upgraded to compliant version of the Company's software by
August 1999. The Company is assisting those clients to upgrade
electronically from the Company's facilities without charge. If the
client desires on-site assistance, the Company is assessing its normal
charges. These services are being conducted in the ordinary course
of the Company's business by its employees, and the costs to the Company
are not expected to be
7
<PAGE>
material.The Company is also engaged in many projects to implement
the Company's products at client sites. These projects require efforts
both by the Company and the clients. For some of these clients, these
projects constitute their solution to Year 2000 issues. All of these
projects are planned to be completed by September 1999.
Internal Operations
The Company believes that its third-party software applications,
operating systems and telephone systems are Year 2000 compliant. The
Company does have some internally developed software applications that
require upgrading to be Year 2000 compliant. These upgrades are being
done internally and should be complete and tested by March 1999. The
Company has also replaced some older computers and operating systems
that were not Year 2000 compliant in the normal course of infrastructure
maintenance.
Suppliers
The suppliers of the computers, operating systems and data bases
necessary to operate the current versions of the Company's software
products have indicated to the Company that those products either are
Year 2000 compliant or they will be by the end of 1999. The Company
has conducted tests of such computers, operating systems and data bases
with the Company's products now being marketed and currently has no
reason to believe that the Company's products are not Year 2000 compliant
when operated with such computers, operating systems and data bases.
Although the Company beleives it Year 2000 review and the actions
it has taken and plans to take in response to the review are appropriate,
there can be no assurance that the review identified all possible issues
or that all identified issues will be satisfactorily resolved. A material
falure of the Company's internal systems to be Year 2000 compliant, a
material failure in suppliers of the computers, operating systems and
data bases used in conjunction with the Company's products to be Year
2000 compliant or a material delay in client projects related to Year
2000 issues could have a material adverse effect on the Company's business,
earnings or financial condition.
8
<PAGE>
Part II. Other Information
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit 11 Computation of Earnings Per Share
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Company during
the quarter ended October 3, 1998.
9
<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.
CERNER CORPORATION
------------------
Registrant
November 17, 1998 By: /s/ Marc G. Naughton
- - ----------------- ---------------------
Date Marc G.Naughton
Chief Financial Officer
10
<PAGE>
Exhibit 11
<TABLE>
CERNER CORPORATION AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
<CAPTION>
Three Months Ended Nine Months Ended
October 3, September 27, October 3, September 27,
-------------------------- --------------------------
1998 1997 1998 1997
----------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
Net earnings: $ 6,348,000 $ 4,445,000 $ 12,388,000 $ 9,706,000
=========== ============ =========== ============
Weighted average number
of common and common stock
equivalent shares:
Basic weighted average number of
outstanding common shares: 32,771,265 32,951,335 32,727,050 32,825,260
----------- ----------- ----------- -----------
Basic earnings per common shares: $ 0.19 $ 0.13 $ 0.38 $ 0.30
----------- ----------- ----------- -----------
Dilutive effect (excess of number
of shares issuable over number
of shares assumed to be
repurchased with the proceeds
of exercised options and converted
warrants based on the average
market price during the period) 968,777 1,555,810 847,457 1,097,709
----------- ---------- ----------- -----------
33,740,042 34,507,145 33,574,507 33,922,969
----------- ---------- ----------- -----------
Diluted earnings per common and
common stock equivalent shares:
equivalent shares: $ 0.19 $ 0.13 $ 0.37 $ 0.29
----------- ---------- ---------- ----------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-02-1999
<PERIOD-END> OCT-03-1998
<CASH> 16,708,000
<SECURITIES> 26,885,000
<RECEIVABLES> 160,129,000
<ALLOWANCES> 1,544,000
<INVENTORY> 2,128,000
<CURRENT-ASSETS> 207,010,000
<PP&E> 117,317,000
<DEPRECIATION> 46,009,000
<TOTAL-ASSETS> 348,318,000
<CURRENT-LIABILITIES> 52,445,000
<BONDS> 0
0
0
<COMMON> 340,000
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 348,318,000
<SALES> 235,658,000
<TOTAL-REVENUES> 235,658,000
<CGS> 63,484,000
<TOTAL-COSTS> 152,088,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 69,000
<INCOME-PRETAX> 20,017,000
<INCOME-TAX> 7,629,000
<INCOME-CONTINUING> 12,388,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 12,388,000
<EPS-PRIMARY> .38
<EPS-DILUTED> .37
</TABLE>
