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 September 30, 1995 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: 0-15627
SEQUENT COMPUTER SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Oregon 93-0826369
(State or other jurisdiction (I.R.S. Employer
of organization or incorporation) Identification Number)
15450 S.W. Koll Parkway
Beaverton, Oregon 97006-6063
(Address of principal executive offices, including zip code)
(503) 626-5700
(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 report), 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 latest practicable date.
33,041,374 common shares were issued and outstanding as of October 28, 1995.
SEQUENT COMPUTER SYSTEMS, INC.
PART I. FINANCIAL INFORMATION
Page No.
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets - September 30, 1995
and December 31, 1994 3
Consolidated Statements of Operations - Three months
and nine months ended September 30, 1995 and October 1, 1994 4
Consolidated Statements of Changes In Shareholders' Equity -
January 2, 1993 through September 30, 1995 5
Consolidated Statements of Cash Flows - Nine months ended
September 30, 1995 and October 1, 1994 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 10
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 11 - Statement regarding computation of earnings per share.
(b) No reports on Form 8-K were filed by the Company during the fiscal
quarter ended September 30, 1995.
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - Unaudited
(in thousands, except per share amounts)
Sept. 30, 1995 Dec. 31, 1994
ASSETS
Current assets:
Cash and cash equivalents $ 64,133 $ 46,291
Restricted deposits 35,473 59,437
Receivables, net 157,097 133,571
Inventories 59,439 48,698
Prepaid royalties and other 18,596 12,812
Total current assets 334,738 300,809
Property and equipment, net 99,536 94,214
Capitalized software costs, net 43,203 38,555
Intangible assets and other, net 2,160 2,399
Total assets $ 479,637 $ 435,977
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable $ 35,473 $ 59,437
Accounts payable and other 61,910 46,744
Accrued payroll 11,414 11,794
Unearned revenue 16,285 9,716
Income taxes payable 6,292 3,850
Current obligations under capital
leases and debt 1,331 800
Total current liabilities 132,705 132,341
Other accrued expenses 1,496 2,100
Long-term obligations under capital
leases and debt 9,102 10,341
Total liabilities 143,303 144,782
Shareholders' equity:
Preferred stock, $.01 par,
none outstanding -- --
Common stock, $.01 par,
32,916 and 31,360 shares outstanding 329 314
Paid-in capital 297,096 278,145
Retained earnings 42,276 17,872
Foreign currency translation adjustment (3,367) (5,136)
Total shareholders' equity 336,334 291,195
Total liabilities and shareholders'
equity $ 479,637 $ 435,977
See notes to consolidated financial statements.
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS - Unaudited
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
Sept. 30, Oct. 1, Sept. 30, Oct. 1,
1995 1994 1995 1994
Revenue:
Product revenue $ 96,970 $ 93,235 $ 283,499 $ 247,248
Service revenue 36,245 28,012 105,022 76,667
Total revenue 133,215 121,247 388,521 323,915
Costs and expenses:
Cost of products sold 45,286 47,477 132,716 122,210
Cost of service revenue 28,364 19,449 78,469 53,788
Research and development 10,220 9,383 29,965 25,686
Selling, general and admin. 38,653 34,235 111,943 97,532
Total costs and expenses 122,523 110,544 353,093 299,216
Operating income 10,692 10,703 35,428 24,699
Interest, net 203 (28) 547 (820)
Other, net (490) (256) (1,390) 279
Income before provision for
income taxes 10,405 10,419 34,585 24,158
Provision for income taxes 2,964 1,545 10,181 3,409
Net income $ 7,441 $ 8,874 $ 24,404 $ 20,749
Net income per share $ 0.22 $ 0.28 $ 0.73 $ 0.65
Weighted average number of
common and common equivalent
shares outstanding 34,515 32,172 33,555 31,723
See notes to consolidated financial statements.
<TABLE>
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - Unaudited
(in thousands)
<CAPTION>
Foreign
Retained Currency
Preferred Stock Common Stock Paid-in Earnings Trans-
Shares Amount Shares Amount Capital (Deficit) lation Total
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, January 2, 1993 1,500 $ 15 22,450 $ 225 $ 186,027 $ (7,738) $ (6,027) $ 172,502
Common shares issued,
net of repurchases -- -- 4,795 47 79,883 -- -- 79,930
Conversion of preferred
stock (1,500) (15) 3,000 30 -- -- -- 15
Net income -- -- -- -- -- (7,524) -- (7,524)
Foreign currency
translation adjustment -- -- -- -- -- -- (1,435) (1,435)
Balance, January 1, 1994 -- $ -- 30,245 $ 302 $ 265,910 $ (15,262) $ (7,462) $ 243,488
Common shares issued -- -- 1,115 12 12,235 -- 12,247
Net income -- -- -- -- -- 33,134 -- 33,134
Foreign currency
translation adjustment -- -- -- -- -- -- 2,326 2,326
Balance, December 31, 1994 -- $ -- 31,360 $ 314 $ 278,145 $ 17,872 $ (5,136) $ 291,195
Common shares issued -- -- 1,493 14 17,952 -- 17,966
Conversion of debentures -- -- 63 1 999 -- -- 1,000
Net income -- -- -- -- -- 24,404 -- 24,404
Foreign currency
translation adjustment -- -- -- -- -- -- 1,769 1,769
Balance, Sept. 30, 1995 -- $ -- 32,916 $ 329 $ 297,096 $ 42,276 $ (3,367) $ 336,334
See notes to consolidated financial statements.
</TABLE>
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - Unaudited
(in thousands)
Nine Months Ended
Sept. 30, 1995 Oct. 1, 1994
Operating activities:
Net income $ 24,404 $ 20,749
Reconciliation of net income to net cash
provided by operating activities -
Depreciation and amortization 38,508 32,852
Changes in assets and liabilities -
Receivables, net (23,526) (16,619)
Inventories (10,741) (2,414)
Prepaid expenses (5,784) (1,671)
Accounts payable and other 15,166 (14,906)
Accrued payroll (380) (299)
Unearned revenue 6,569 2,824
Income taxes payable 2,442 1,312
Deferred income taxes -- (541)
Other, net (802) (853)
Net cash provided by operating activities 45,856 20,434
Investing activities:
Restricted deposits 23,964 (21,164)
Investments, net -- 5,000
Purchases of property and equipment, net (31,254) (33,890)
Capitalized software costs (16,787) (14,231)
Foreign currency translation 1,769 2,298
Other, net -- (138)
Net cash used for investing activities (22,308) (62,125)
Financing activities:
Notes payable, net (23,964) 21,164
Payments under capital lease obligations (652) (2,273)
Long-term debt, net (56) (5)
Stock issuance proceeds, net 17,966 7,764
Convertible debenture proceeds 1,000 --
Net cash (used) provided by
financing activities (5,706) 26,650
Net increase (decrease) in cash and
cash equivalents 17,842 (15,041)
Cash and cash equivalents at beginning of period 46,291 42,986
Cash and cash equivalents at end of period $ 64,133 $ 27,945
See notes to consolidated financial statements.
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1995
Basis of Presentation
The accompanying consolidated financial statements are unaudited and have been
prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission and in the opinion of management include
all adjustments, consisting only of normal recurring adjustments, necessary
for a fair statement of the results for the interim periods. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. These
consolidated financial statements should be read in conjunction with the
audited financial statements and notes thereto included in the Company's
annual report and Form 10-K for the fiscal year ended December 31, 1994.
The Company's fiscal year is based on a 52-53 week calendar ending the
Saturday closest to December 31. The accompanying consolidated financial
statements include the accounts of Sequent Computer Systems, Inc. and its
wholly owned subsidiaries (the Company or Sequent). All significant
intercompany accounts and transactions have been eliminated. The results for
interim periods are not necessarily indicative of the results for the entire
year.
Accounts Receivable
At September 30, 1995, accounts receivable in the accompanying consolidated
balance sheet is net of $8 million received by the Company under its two year
agreement to sell its domestic accounts receivables.
Inventories
Inventories consist of the following:
(in thousands)
Sept. 30, Dec. 31,
1995 1994
Raw Materials $ 8,559 $ 5,377
Work in Process 3,140 2,065
Finished Goods 47,740 41,256
$ 59,439 $ 48,698
Property and Equipment
Property and equipment consist of the following:
(in thousands)
Sept. 30, Dec. 31,
1995 1994
Land $ 5,037 $ 5,037
Operational Equipment 134,200 119,535
Furniture and Office Equipment 62,946 53,872
Leasehold Improvements 15,715 12,341
217,898 190,785
Less Accum. Depr. & Amort. 118,362 96,571
$ 99,536 $ 94,214
Research and Development
Amortization of capitalized software costs, generally based on a three-year
life, was $4.5 million and $12.1 million for the three month and nine month
periods ended September 30, 1995, respectively. Amortization for the same
periods in 1994 was $3.4 million and $9.2 million, respectively.
Restructuring Charge
The realignment of resources to provide open distributed client/server
computing solutions, professional service consulting and architecture-led
selling, marketing and engineering strategies is progressing according to
plan. The $1.0 million remaining accrual is primarily related to obligations
associated with closed facility leases and future extended employee benefit
costs. Management expects that the remaining accrual will be fully utilized
according to the realignment plan. The fourth quarter of 1993 restructuring
reduced operating expenses by approximately $400,000 for the third quarter
ended September 30, 1995 and $1.0 million for the first nine months of 1995.
Notes Payable
The Company has an unsecured line of credit agreement with a group of banks
which provides short-term borrowings of up to $50 million (increased from $30
million in June 1995). No borrowings were outstanding at September 30, 1995.
The Company has a short-term borrowing agreement with a foreign bank as a hedge
to cover certain foreign currency exposures for a maximum of approximately
$56.9 million. At September 30, 1995, borrowings of $35.5 million were
outstanding under this agreement.
The Company has a short-term borrowing agreement with a domestic bank for an
additional hedging facility to cover certain foreign currency exposures for a
maximum of $10 million, excluding foreign currency fluctuations. No borrowings
were outstanding at September 30, 1995.
Obligations Under Capital Leases and Long-Term Debt
In August 1995, $1.0 million of Convertible Debentures were converted at
$15.81 per share into 63,241 shares of the Company's common stock.
Income Taxes
Effective the beginning of fiscal 1992, the Company adopted Statement of
Financial Accounting Standards No. 109, "Accounting For Income Taxes" (FAS
109). The effective tax rate differs from the statutory tax rate principally
due to tax benefits from the Company's foreign sales corporation and tax
benefits related to the utilization of net operating loss carryforwards which
the Company has available.
Earnings Per Share
See Exhibit 11 for the computation of average shares outstanding and earnings
per share.
Significant Customers
The Company has no single customer that represents greater than 10% of total
revenue for the quarters ending September 30, 1995 and October 1, 1994.
Geographic Segment Information
Export and foreign revenue was $73.9 million (55% of total revenue) for the
three months ended September 30, 1995 and $210.4 million (54% of total revenue)
for the first nine months of 1995. Export and foreign revenue was $60.4
million and $154.3 million (50% and 48% of total revenue, respectively) for the
corresponding periods in 1994. The Company's United States operations
generated operating income of $8.9 million for the three months ended September
30, 1995 and $32.8 million for the first nine months of 1995. Foreign
operations generated operating income of $1.8 million and $2.6 million during
the corresponding periods in 1995. Comparable operating income for the three
months ended October 1, 1994 and for the first nine months of 1994 were $10.0
million and $21.1 million for U.S. operations and $700,000 and $3.6 million for
foreign operations.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
September 30, 1995
GENERAL
Total revenue was $133.2 million in the third quarter of 1995 compared to
$121.2 million in the third quarter of 1994. Total revenue was $388.5 million
in the first nine months of 1995 compared to $323.9 million in the first nine
months of 1994. Net income was $7.4 million in the third quarter of 1995
compared to $8.9 million in the third quarter of 1994. Net income was $24.4
million in the first nine months of 1995 compared to $20.7 million in the
first nine months of 1994.
REVENUE
(dollars in millions)
Three Months Ended Nine Months Ended
Sept. 30, % Oct. 1, Sept. 30, % Oct. 1,
1995 Chg 1994 1995 Chg 1994
End-user product revenue $ 91.1 4% $ 88.0 $ 273.1 21% $ 226.1
Service revenue 36.2 29% 28.0 105.0 37% 76.7
Total end-user revenue 127.3 10% 116.0 378.1 25% 302.8
OEM product revenue 5.9 13% 5.2 10.4 (51)% 21.1
Total revenue $ 133.2 10% $ 121.2 $ 388.5 20% $ 323.9
Export and Foreign Revenue $ 73.9 22% $ 60.4 $ 210.4 36% $ 154.3
End-user product revenue for the third quarter and first nine months of 1995
improved over the corresponding quarter and first nine months of 1994 due to
strong results from Europe. The Company believes the increase in revenue
reflects continued growth in the market for Sequent products combined with the
Company's strategy of targeting higher value contracts.
Service revenue continued to benefit from the growing installed customer base
and strategic decisions to increase levels of consulting services combined
with the targeting of higher value contracts. OEM product revenue is
substantially sales to Unisys Corporation.
Export and foreign revenue was 55% of total revenue in the third quarter and
54% of total revenue in the first nine months of 1995 and 50% and 48% of total
revenue in the corresponding quarter and first nine months of 1994. The
increase in export and foreign revenue as a percentage of total revenue in the
third quarter and first nine months of 1995 compared to the corresponding
periods in 1994 was due to significant revenue increases in Europe.
COST OF SALES
(dollars in millions)
Three Months Ended Nine Months Ended
Sept. 30, Oct. 1, Sept. 30, Oct. 1,
1995 1994 1995 1994
Costs of products sold $ 45.3 $ 47.5 $ 132.7 $ 122.2
As a percentage of product revenue 46.7% 50.9% 46.8% 49.4%
Costs of service revenue $ 28.4 $ 19.4 $ 78.5 $ 53.8
As a percentage of service revenue 78.3% 69.4% 74.7% 70.2%
Costs of products sold as a percentage of product revenue decreased in both
the third quarter and first nine months of 1995 compared to the corresponding
periods of 1994. This decrease is attributed to cost improvements and
efficiencies as well as an increase in the number of higher margin larger
scale systems sold in 1995 compared to 1994.
Service revenue as a percentage of total revenue increased for the third
quarter and first nine months of 1995 over the corresponding quarter and first
nine months of 1994. The Company's continued investment in growing its
consulting services business attributed to the increase of cost of service
revenue as a percentage of service revenue in both the third quarter and first
nine months of 1995 compared to the corresponding periods of 1994.
RESEARCH AND DEVELOPMENT
(dollars in millions)
Three Months Ended Nine Months Ended
Sept. 30, Oct. 1, Sept. 30, Oct. 1,
1995 1994 1995 1994
Research and Development $ 10.2 $ 9.4 $ 30.0 $ 25.7
As a percentage of total revenue 8% 8% 8% 8%
Software costs capitalized $ 5.7 $ 4.9 $ 16.8 $ 14.2
Research and development costs remained relatively constant as a percentage of
total revenue comparing both the third quarter and first nine months of 1995
and 1994. Research and development costs include continued investment in new
product development and enhancements to existing products.
Software costs capitalized increased in the third quarter and first nine
months of 1995 due to greater emphasis on hardware development for future
products. These product costs are expensed as incurred.
SELLING, GENERAL AND ADMINISTRATIVE
(dollars in millions)
Three Months Ended Nine Months Ended
Sept. 30, % Oct. 1, Sept. 30, % Oct. 1,
1995 Chg 1994 1995 Chg 1994
Selling, general and admin. $ 38.7 13% $ 34.2 $ 111.9 15% $ 97.5
As a percentage of total revenue 29% 28% 29% 30%
Selling, general and administrative costs increased 13% and 15% in the third
quarter and first nine months of 1995, respectively, compared to the
corresponding periods in 1994 primarily as a result of the Company's
continuing efforts to increase its investment in its sales force and its
related associated cost. Selling, general and administrative costs decreased
as a percentage of total revenue in the first nine months of 1995 compared to
the corresponding period in 1994 due to greater total revenue levels along
with cost control, despite the increase between the third quarter of 1995
compared to the third quarter of 1994.
RESTRUCTURING CHARGE
The realignment of resources to provide open distributed client/server
computing solutions, professional service consulting and architecture-led
selling, marketing and engineering strategies is progressing according to
plan. The $1.0 million remaining accrual is primarily related to obligations
associated with closed facility leases and future extended employee benefit
costs. Management expects that the remaining accrual will be fully utilized
according to the realignment plan. The fourth quarter of 1993 restructuring
reduced operating expenses by approximately $400,000 for the third quarter
ended September 30, 1995 and $1.0 million for the first nine months of 1995.
INTEREST AND OTHER, NET
(dollars in millions)
Quarter Ended Nine Months Ended
Sept. 30, Oct. 1, Sept. 30, Oct. 1,
1995 1994 1995 1994
Interest, net $ 0.2 $ (0.0) $ 0.5 $ (0.8)
Other, net (0.5) (0.3) (1.4) 0.3
Provisions for income taxes 3.0 1.5 10.2 3.4
Interest income in the third quarter and first nine months of 1995 and 1994
was primarily generated from restricted deposits held at foreign and domestic
banks, short-term investments and cash and cash equivalents. Interest expense
in the third quarter and first nine months of 1995 and 1994 includes costs
related to Convertible Debentures, foreign currency hedging loans, capital
lease obligations and in 1994 long-term debt.
Other expenses primarily represents effects of foreign currency transactions
and other miscellaneous non-operating income and expenses.
The provision for income taxes includes benefits related to the Company's
foreign sales corporation and the utilization of available domestic and
foreign tax attributes carried forward from prior years. The increase in the
Company's effective tax rate from 14% in the third quarter of 1994 to 28.5% in
the third quarter of 1995 is primarily attributed to utilization of a majority
of its remaining net operating loss carryforwards during December 31, 1994.
LIQUIDITY AND CAPITAL RESOURCES
Working capital increased to $202.0 million at September 30, 1995 from $168.5
million at December 31, 1994. The Company's current ratio at September 30,
1995 and December 31, 1994 was 2.5:1 and 2.3:1, respectively.
For the first nine months of 1995, cash and cash equivalents increased $17.8
million. The Company continues to invest in property and equipment ($31.2
million), and capitalized software ($16.8 million). Other uses of funds were
increases in net receivables ($23.5 million), increases in inventories ($10.7
million), and increases in prepaid expenses ($5.8 million). Primary sources
of funds were net income ($24.4 million), depreciation and amortization ($38.5
million), increases in accounts payable and other ($15.2 million), increases
in unearned revenue ($6.6 million), increases in income tax payable ($2.4
million), and stock issuance proceeds from employee stock purchases and stock
option plans ($18.0 million).
The Company has a $20 million receivable sales facility with a group of banks.
At September 30, 1995, accounts receivable in the accompanying consolidated
balance sheet is net of $8 million received by the Company under this
agreement to sell its domestic accounts receivable.
The Company continues to maintain a $50 million line of credit (increased from
$30 million in June 1995) with a group of banks for operating purposes in
addition to short-term borrowing agreements totaling approximately $66.9
million as hedge facilities to cover certain foreign currency exposures. At
September 30, 1995, no borrowings were outstanding under the line of credit
and $35.5 million was outstanding under the short-term borrowing agreements.
Management expects that current funds, funds from operations, and the bank
lines of credit will provide adequate resources to meet the Company's
anticipated cash requirements through 1995.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SEQUENT COMPUTER SYSTEMS, INC.
________________________________
Robert S. Gregg
Sr. Vice President of Finance and
Chief Financial Officer
Date: November 15, 1995
EXHIBIT INDEX
Sequential
Exhibit No. Description Page No.
11 Statement regarding computation
of earnings per share 15
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
STATEMENT SHOWING CALCULATION OF AVERAGE
COMMON SHARES OUTSTANDING AND EARNINGS
PER AVERAGE COMMON SHARE
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, 1995 September 30, 1995
Weighted average number
of common shares outstanding 32,523 31,946
Application of the "treasury
stock" method to the stock option
and employee stock purchase plans 1,997 1,707
Weighted average of common stock
equivalent shares attributable
to convertible debentures 575 618
Total common and common
equivalent shares, assuming
full dilution 35,095 34,271
Net income 7,441 24,404
Add:
Interest on convertible debentures,
net of applicable income taxes 120 386
Net income, assuming full dilution 7,561 24,790
Net income per common share,
assuming full dilution (A) $ 0.22 $ 0.73
(A) In accordance with generally accepted accounting principles, fully-diluted
earnings per share may not exceed primary earnings per share. The
difference between primary and fully-diluted earnings per share is due to
rounding. The sum of nine months earning per share does not equal the
sum of quarterly earnings per share as a result of quarterly versus nine
months average shares outstanding.
The computation of primary net income per common share is not included as
the computation can be clearly determined from the material contained in
this report.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 99,606,000
<SECURITIES> 0
<RECEIVABLES> 159,743,000
<ALLOWANCES> 2,646,000
<INVENTORY> 59,439,000
<CURRENT-ASSETS> 334,738,000
<PP&E> 220,698,000
<DEPRECIATION> 121,162,000
<TOTAL-ASSETS> 479,637,000
<CURRENT-LIABILITIES> 132,705,000
<BONDS> 9,102,000
<COMMON> 329,000
0
0
<OTHER-SE> 336,005,000
<TOTAL-LIABILITY-AND-EQUITY> 479,637,000
<SALES> 283,499,000
<TOTAL-REVENUES> 388,521,000
<CGS> 132,716,000
<TOTAL-COSTS> 211,185,000
<OTHER-EXPENSES> 141,908,000
<LOSS-PROVISION> 852,000
<INTEREST-EXPENSE> 3,469,000
<INCOME-PRETAX> 0
<INCOME-TAX> 10,181,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,404,000
<EPS-PRIMARY> 0.73
<EPS-DILUTED> 0.73
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