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 March 29, 1997 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.
34,851,645 common shares were issued and outstanding as of April 26, 1997.
SEQUENT COMPUTER SYSTEMS, INC.
PART I. FINANCIAL INFORMATION
Page No.
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets - March 29, 1997
and December 28, 1996 3
Consolidated Statements of Operations - Three
months ended March 29, 1997 and March 30, 1996 4
Consolidated Statements of Shareholders' Equity -
December 31, 1994 through March 29, 1997 5
Consolidated Statements of Cash Flows - Three
months ended March 29, 1997 and March 30, 1996 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 14
(a) Exhibit 11 - Statement regarding computation of
earnings per share. 15
(b) No reports on Form 8-K were filed by the Company
during the fiscal quarter ended March 29, 1997.
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - Unaudited
(in thousands, except per share amounts)
March 29, 1997 Dec. 28, 1996
ASSETS
Current assets:
Cash and cash equivalents $ 35,941 $ 37,979
Restricted deposits 31,878 44,655
Receivables, net 185,716 209,752
Inventories 84,807 74,491
Prepaid royalties and other 34,738 30,577
Total current assets 373,080 397,454
Property and equipment, net 139,981 133,838
Capitalized software costs, net 61,762 59,567
Other assets, net 20,931 21,150
Total assets $ 595,754 $ 612,009
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable $ 56,198 $ 59,925
Accounts payable and other 74,575 88,119
Accrued payroll 17,261 24,853
Unearned revenue 35,023 30,787
Income taxes payable 2,822 3,017
Current obligations under capital leases
and debt 8,978 7,325
Total current liabilities 194,857 214,026
Other accrued expenses 6,884 6,671
Long-term obligations under capital leases
and debt 14,418 16,503
Total liabilities 216,159 237,200
Shareholders' equity:
Common stock, $.01 par value,
34,840 and 34,188 shares outstanding 348 342
Paid-in capital 322,458 315,316
Retained earnings 61,423 60,715
Foreign currency translation adjustment (4,634) (1,564)
Total shareholders' equity 379,595 374,809
Total liabilities and shareholders'
equity $ 595,754 $ 612,009
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
Mar. 29, 1997 Mar. 30, 1996
Revenue:
Product $ 105,567 $ 81,109
Service 51,807 39,636
Total revenue 157,374 120,745
Costs and expenses:
Cost of products sold 50,455 38,653
Cost of service revenue 38,799 30,611
Research and development 15,442 12,262
Selling, general and administrative 50,250 38,245
Total costs and expenses 154,946 119,771
Operating income 2,428 974
Interest, net (1,250) 213
Other, net (142) (363)
Income before provision for income taxes 1,036 824
Provision for income taxes 328 226
Net income $ 708 $ 598
Net income per share $ .02 $ .02
Weighted average number of common
and common equivalent shares
outstanding 36,643 33,616
See notes to consolidated financial statements.
<TABLE>
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - Unaudited
(In thousands)
<CAPTION>
Retained Foreign
earnings currency
Common Stock Paid-in (accumulated translation
Shares Amount capital deficit) adjustment Total
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1994 31,360 314 278,145 17,872 (5,136) 291,195
Common shares issued 1,798 18 20,455 - - 20,473
Tax benefit of option exercises - - 4,743 - - 4,743
Conversion of debentures 63 - 1,000 - - 1,000
Net income - - - 35,073 - 35,073
Foreign currency translation
adjustment - - - - 704 704
Balance, December 30, 1995 33,221 332 304,343 52,945 (4,432) 353,188
Common shares issued 967 10 9,622 - - 9,632
Tax benefit of option exercises - - 175 - - 175
Warrants issued - - 1,176 - - 1,176
Net income - - - 7,771 - 7,771
Foreign currency translation
adjustment - - - - 2,868 2,868
Rounding - - - (1) - (1)
Balance, December 28, 1996 34,188 342 315,316 60,715 (1,564) 374,809
Common shares issued 652 6 6,879 - - 6,885
Tax benefit of option exercises - - 263 - - 263
Net income - - - 708 - 708
Foreign currency translation
adjustment - - - - (3,070) (3,070)
Balance, March 29, 1997 34,840 $ 348 $ 322,458 $ 61,423 $ (4,634) $ 379,595
</TABLE>
See notes to consolidated financial statements.
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - Unaudited
(in thousands)
Three Months Ended
Mar. 29, 1997 Mar. 30, 1996
Cash flow from operating activities:
Net income $ 708 $ 598
Reconciliation of net income to net cash
provided by operating activities -
Depreciation and amortization 19,515 14,641
Changes in assets and liabilities -
Receivables, net 24,036 33,891
Inventories (10,316) (15,159)
Prepaid royalties and other (4,161) (4,104)
Accounts payable and other (13,544) (5,419)
Accrued payroll (7,592) 2,193
Unearned revenue 4,236 3,660
Income taxes payable (195) (113)
Other accrued expenses 231 472
Other, net (27) (60)
Net cash provided by operating
activities 12,891 30,600
Cash flow from investing activities:
Restricted deposits 12,777 1,957
Purchases of property and equipment, net (19,237) (17,220)
Capitalized software costs (8,388) (7,531)
Foreign currency translation adjustment (3,070) (1,194)
Net cash used for investing activities (17,918) (23,988)
Cash flow from financing activities:
Notes payable, net (3,727) (3,182)
Proceeds (payments) under capital lease
obligations (443) 244
Long-term debt proceeds, net 11 --
Stock issuance proceeds, net 7,148 2,470
Net cash provided (used) by financing
activities 2,989 (468)
Net increase (decrease) in cash and
cash equivalents (2,038) 6,144
Cash and cash equivalents at beginning of period 37,979 61,939
Cash and cash equivalents at end of period $ 35,941 $ 68,083
See notes to consolidated financial statements.
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 29, 1997
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 28, 1996.
The Company's fiscal year is based on a 52-53 week year 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.
Reclassifications
Reclassifications have been made to amounts in certain prior years. These
changes had no impact on previously reported results of operations.
Recently Issued Accounting Standard
In March 1997, the FASB issued Statement of Financial Accounting Standards No.
128, Earnings Per Share (SFAS 128). SFAS 128 applies to entities with
publicly held common stock and is effective for financial statements issued
for periods ending after December 15, 1997. SFAS 128 replaces APB Opinion 15,
Earnings Per Share, and simplifies the computation of EPS by replacing the
presentation of primary EPS with a presentation of basic EPS. The impact of
the SFAS 128 EPS calculation for the first quarter of 1997 is not material.
See Exhibit 11 for the computation of average shares outstanding and earnings
per share.
Accounts Receivable
At March 29, 1997, accounts receivable in the accompanying consolidated
balance sheet is net of $20 million received by the Company under its
agreement to sell its domestic accounts receivables.
Inventories
Inventories consist of the following:
(in thousands)
Mar. 29, Dec. 28,
1997 1996
Raw materials $ 16,417 $ 14,205
Work-in-progress 5,045 2,166
Finished goods 63,345 58,120
$ 84,807 $ 74,491
Property and Equipment
Property and equipment consist of the following:
(in thousands)
Mar. 29, Dec. 28,
1997 1996
Land $ 5,037 $ 5,037
Operational equipment 188,488 174,662
Furniture and office equipment 94,207 89,951
Leasehold improvements 23,271 22,584
311,003 292,234
Less accum. depr. & amort. (171,022) (158,396)
$ 139,981 $ 133,838
Research and Development
Amortization of capitalized software costs, generally based on a three-year
life, was $6.2 million and $4.8 million for the three month periods ended
March 29, 1997 and March 30, 1996, respectively.
Notes Payable
The Company has an unsecured line of credit agreement with a group of banks
which provides short-term borrowings of up to $70 million. The line of credit
agreement extends through May 30, 1997. At March 29, 1997, $20.5 million was
outstanding under this line of credit agreement. There were no borrowings
outstanding under the line of credit at March 30, 1996. The interest rate on
this borrowing at March 29, 1997 was 8.5%.
The Company has a short-term borrowing agreement with a foreign bank as a hedge
to cover certain foreign currency exposures. Borrowings under the agreement
are denominated in various foreign currencies. Proceeds from the borrowings
are converted into U.S. dollars and placed in a term deposit account with the
foreign bank. At March 29, 1997, maximum borrowings allowed under the agree-
ment were approximately $54.3 million. The maximum borrowing limit is denomi-
nated in specified foreign currencies and fluctuates with the change in
foreign exchange rates. Amounts outstanding were $31.9 million at March 29,
1997.
In addition to the above borrowing agreements, the Company has entered into
certain other miscellaneous borrowing arrangements with a foreign bank. At
March 29, 1997 and March 30, 1996, $1.6 million and $0.3 million were out-
standing, respectively.
During 1996 a U.S. subsidiary of the Company entered into a financing
arrangement with third parties for $2.2 million, of which $1 million is with
a related party. The financing consists of short-term convertible notes with an
an interest rate of 10%. The notes may be converted into capital stock of the
subsidiary after February 23, 1997 at the option of the holders.
Obligations under Capital Leases and Long-Term Debt
In April 1992, the Company issued $20 million of 7.5% Convertible Subordinated
Debentures ("Convertible Debentures" or "Debentures") due March 31, 2000. In
conjunction with the Company's equity offering in 1993, $9.9 million of the
Debentures were converted into 626,000 shares of common stock and are no
longer classified as long-term debt. The Convertible Debentures are
convertible into the Company's common stock at the option of the holders at
an initial conversion price of $15.81 per share. Under this provision, in
August 1995, an additional $1.0 million of the Debentures were converted into
63,000 shares of common stock, further reducing long-term debt. Beginning on
June 30, 1997, the Company is required to make quarterly principal payments of
$1.7 million through 1998 to retire the outstanding Debentures. The balance
outstanding on the Debentures was $9.1 million at both March 29, 1997 and
December 28, 1996. At March 29, 1997, $6.7 million is classified as current
obligations. The Convertible Debentures are callable at the option of the
Company after five years. The Debentures contain certain financial covenants,
including restrictions on additional debt, minimum net worth levels and a
prohibition on the payment of dividends.
Income Taxes
The Company's general practice is to reinvest the earnings of its foreign
subsidiaries operations, unless it would be advantageous to the Company to
repatriate the foreign subsidiaries' retained earnings. The effective tax rate
differs from the statutory tax rate principally due to the benefit from the
Company's foreign sales corporation.
Significant Customers
The Company operates primarily in one business segment which includes the
design, manufacture and marketing of high-performance computer systems and
operating environment software. Project-oriented offerings include a
comprehensive portfolio of customer, professional and education services to
solve complex Information Technology problems. Approximately 16% of the
Company's revenues in the first quarter of 1997 were from one customer.
Geographic Segment Information
Export and foreign revenue was $79.7 million (50% of total revenue) for the
three months ended March 29, 1997. Export and foreign revenue was $64 million
(53% of total revenue) for the corresponding period in 1996. The Company's
United States operations generated operating income of $8.5 million for the
three months ended March 29, 1997 and foreign operations generated net
operating losses of $6.1 million. The results of comparable periods in 1996
were operating income of $1.3 million for the United States operations and
operating losses of $0.3 million for
the Company's foreign operations.
Forward Looking Statements
Forward-looking statements may be made by the Company from time to time. The
following factors are among the factors that could cause actual results to
differ materially from the forward-looking statements: timely completion of
product development and customer acceptance of the Company's NUMA-Q product
line; business conditions and growth in the electronics industry and general
economies, both domestic and international; lower than expected customer
orders, delays in receipt of orders or cancellation of orders; competitive
factors, including increased competition, new product offerings by competitors
and price pressures; the availability of third party parts and supplies at
reasonable prices; changes in product mix and the mix between product and
service revenue; significant quarterly performance fluctuations due to the
receipt of a significant portion of customer orders and product shipments in
the last month of each quarter; and product shipment interruptions due to
manufacturing problems.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
March 29, 1997
OVERVIEW
Total revenue was $157.4 million in the first quarter of 1997 compared to
$120.7 million in the first quarter of 1996. Net income was $0.7 million in
the first quarter of 1997 compared to $0.6 million in the first quarter of
1996. Factors contributing to the 30% increase in total revenue in the first
quarter of 1997 compared to the same period in 1996 included sales from the
Company's new NUMA-Q 2000 product line and an overall increase in the number
and size of new projects. Net income was roughly flat in the first quarter
of 1997 compared to the first quarter in 1996 and is attributed to continued
levels of R&D and SG&A spending as a percentage of revenue. The expenses
reflect the increase in sales and professional service headcount in 1996 as
well as continued investment in research and development and other expenses
related to the worldwide rollout of the Company's new product line, NUMA-Q 2000.
RESULTS OF OPERATIONS
The following table sets forth certain operating data as a percentage of total
revenue:
Three months ended
March 29, March 30,
1997 1996
Revenue:
End-user products 64.5% 63.1%
OEM products 2.6 4.1
Service 32.9 32.8
Total revenue 100.0 100.0
Cost of products and service 56.7 57.4
Gross profit 43.3 42.6
Operating expenses:
Research and development 9.8 10.2
Selling, general and administrative 32.0 31.6
Total operating expenses 41.8 41.8
Operating income 1.5 0.8
Interest income (expense), net (0.8) 0.2
Other income (expense), net (0.1) (0.3)
Income before provision
for income taxes 0.6 0.7
Provision for income taxes 0.2 0.2
Net income 0.4% 0.5%
REVENUE
The Company's product sales increased significantly in the first quarter of
1997 over the same period in 1996. Factors contributing to this increase
include a continued, solid year-to-year growth in the number and size of
projects, as well as a strong demand for the Company's new NUMA-Q product
line, which was formally introduced in February 1997. Sales of NUMA-Q
products represented 34% of total product revenue in the first quarter of
1997. Strong growth in the number and size of project sales which included
services contributed to the 31% increase in service revenue in the first
quarter of 1997 compared to the same period in 1996. The Company has
continued to see growth in its foreign operations. International revenue was
$79.7 million in the first quarter of 1997 compared to $64 million in the
first quarter of 1996. The majority of this increase is from operations in
the United Kingdom. As expected, OEM revenue has continued to decline as a
percentage of total revenue as the Company has focused its investment into its
direct sales organization and indirect channels other than OEM partners.
COST OF SALES
The factors influencing gross margins in a given period generally include unit
volumes (which affect economies of scale), product configuration mix, changes
in component and manufacturing costs, product pricing and the mix between
product and service revenue. The Company's overall product gross margins were
approximately 52% for the first quarter of 1997 as well as the first quarter
of 1996. Included in product margins in the first quarter of 1997 were
favorable margins from sales of the Company's new NUMA-Q product line. These
margins were partially offset by lower margin sales of the Company's Symmetry
products. The Company's service gross margins increased slightly in the first
quarter of 1997 over the same period in 1996. Factors contributing to the
increase included pricing and mix of service offerings between customer and
professional service, as well as overall growth in service revenue. The
Company expanded its professional services organization significantly during
1996 which has contributed to the increase in cost of service revenue in the
first quarter of 1997 over the same period in 1996. The Company increased its
professional services headcount by approximately 23% since the first quarter
in 1996. Professional service revenue has increased approximately 33% in the
first quarter of 1997 compared to the same period in 1996.
RESEARCH AND DEVELOPMENT
Consistent with management's plans, the Company has continued to invest
significantly in its new NUMA-Q architecture and software development, as well
as ongoing enhancements to existing products. Research and development
expense as a percentage of total revenue was 10% in both the first quarter of
1997 and 1996, compared to 9% for the fiscal year 1996 and 8% for 1995. The
Company intends to continue with substantial investments over the remainder of
1997 to enhance its new NUMA-Q 2000 product line which was formally introduced
to the marketplace in the first quarter of 1997.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, general and administrative expenses were $50.2 million and $38.2
million for the three months ended March 29, 1997 and March 30, 1996,
respectively. This increase is the result of investments made by the Company
for the worldwide rollout of its new NUMA-Q product line, which was introduced
to the marketplace in the first quarter of 1997. In 1996, the Company
expanded its sales organization through significant increases in headcount.
At March 29, 1997 the number of sales executives was approximately 250
compared to 194 at March 30, 1996. As a percentage of revenue, selling,
general and administrative expenses have remained relatively flat compared to
the first quarter of 1996.
INTEREST AND OTHER, NET
Interest income is primarily generated from restricted deposits held at
foreign and domestic banks, short-term investments and cash and cash
equivalents. Interest expense includes costs related to convertible
debentures, foreign currency hedging loans, interim short-term borrowing and
capital lease obligations. Interest income and expense for the first quarter
of 1997 was $0.6 million and $1.9 million respectively, and $0.9 million and
$0.7 million for the same period in 1996. The Company's use of funds for its
continued investment in its new NUMA-Q product line is a factor in the
increase in interest expense in the first quarter of 1997 over the same period
in 1996.
Other expense consists primarily of net gains and losses on sale of assets and
discount on sale of receivables.
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 effective tax
rate for the first quarter of 1997 was 32%, compared to 27% for the
corresponding period in 1996 and overall annual effective tax rate for 1996.
The increase in the rate is due mainly to limited tax attribute carryforwards
available in fiscal year 1997 and the dilution of permanent tax benefits such
as the foreign sales corporation due to differences in pre-tax earnings year
over year.
LIQUIDITY AND CAPITAL RESOURCES
Working capital was $178.2 million at March 29, 1997 compared to $183.4
million at December 28, 1996. The Company's current ratio at March 29, 1997
and December 28, 1996 was 1.9:1.
Although net cash provided by operations during the three months ended March
29, 1997 totaled $12.9 million, cash and cash equivalents decreased by $2
million. The Company continued to make significant investments in property
and equipment ($19.2 million), inventories ($10.3 million) and capitalized
software ($8.4 million), primarily related to product and software development
associated with its new NUMA-Q product line. Sources of funds primarily
included net decreases in account receivables ($24 million) and net proceeds
from issuances of stock ($7 million).
The Company has a $20 million receivable sales facility with a group of banks.
At March 29, 1997 accounts receivable in the accompanying consolidated balance
sheet is net of $20 million received by the Company under this agreement to
sell its domestic accounts receivable.
The Company maintains a $70 million revolving line of credit agreement. The
line is unsecured and extends through May 30, 1997. The line contains certain
financial covenants and prohibits the Company from paying dividends without
the lenders' consent. At March 29, 1997, $20.5 million was outstanding under
the line of credit.
The Company maintains a short-term borrowing agreement with a foreign bank to
cover foreign currency exposures. Maximum borrowings allowed under the
foreign bank agreement were $54.3 million, of which $31.9 million was
outstanding at March 29, 1997 (based on currency exchange rates on such date).
The Company also maintains miscellaneous borrowing arrangements with a foreign
bank. At March 29, 1997, $1.6 million was outstanding under this agreement.
In addition to the above, a subsidiary of the Company issued short-term
convertible notes during 1996 totaling $2.2 million, which are outstanding at
March 29, 1997.
Management expects that current funds, funds from operations and the bank
lines of credit will provide adequate resources to meet the Company's
anticipated operational cash requirements during the remainder of 1997.
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.
/s/ Robert S. Gregg
Robert S. Gregg
Sr. Vice President of Finance and
Chief Financial Officer
Date: May 12, 1997
EXHIBIT INDEX
Sequential
Exhibit No. Description Page No.
11 Statement regarding computation
of earnings per share 15
SEQUENT COMPUTER SYSTEMS, INC. AND SUBSIDIARIES EXHIBIT 11
STATEMENT SHOWING CALCULATION OF AVERAGE
COMMON SHARES OUTSTANDING AND EARNINGS
PER AVERAGE COMMON SHARE
(in thousands, except per share amounts)
Three Months Ended
March 29, 1997 March 30, 1996
Weighted average number
of common shares outstanding 34,427 33,298
Application of the "treasury
stock" method to the stock option
and employee stock purchase plans (A) 2,217 318
Weighted average of common stock
equivalent shares attributable
to convertible debentures 575 575
Total common and common
equivalent shares, assuming
full dilution 37,219 34,191
Net income $ 708 $ 598
Add:
Interest on convertible debentures,
net of applicable income taxes 114 119
Net income, assuming full dilution $ 822 $ 717
Net income per common share,
assuming full dilution (B) $ .02 $ .02
(A) Effective with the third quarter of 1996, the Company applied the
"Modified Treasury Stock" method to calculate outstanding shares for
stock options in accordance with APB 15.
(B) In accordance with generally accepted accounting principles, fully-
diluted earnings per share may not exceed primary earnings per share.
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> 3-MOS
<FISCAL-YEAR-END> JAN-03-1998
<PERIOD-END> MAR-29-1997
<CASH> 67,819,000
<SECURITIES> 0
<RECEIVABLES> 188,775,000
<ALLOWANCES> 3,059,000
<INVENTORY> 84,807,000
<CURRENT-ASSETS> 373,080,000
<PP&E> 308,203,000
<DEPRECIATION> 168,223,000
<TOTAL-ASSETS> 595,754,000
<CURRENT-LIABILITIES> 194,857,000
<BONDS> 14,418,000
0
0
<COMMON> 348,000
<OTHER-SE> 322,458,000
<TOTAL-LIABILITY-AND-EQUITY> 595,754,000
<SALES> 105,567,000
<TOTAL-REVENUES> 157,374,000
<CGS> 50,455,000
<TOTAL-COSTS> 89,254,000
<OTHER-EXPENSES> 65,692,000
<LOSS-PROVISION> 300,000
<INTEREST-EXPENSE> 1,865,000
<INCOME-PRETAX> 0
<INCOME-TAX> 328,000
<INCOME-CONTINUING> 708,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 708,000
<EPS-PRIMARY> 0.02
<EPS-DILUTED> 0.02
</TABLE>
