<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
{X} QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 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 0-15846
HealthCare COMPARE Corp.
------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-3307583
------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
3200 Highland Avenue, Downers Grove, Illinois 60515
---------------------------------------------------
(Address of principal executive offices, Zip Code)
(630) 241-7900
--------------
(Registrant's phone number, including area code)
---------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
The number of shares of Common Stock, par value $.01 per share, outstanding on
May 9, 1997 was 32,956,370.
<PAGE> 2
HealthCare COMPARE Corp. and Subsidiaries
INDEX
<TABLE>
<CAPTION>
Part I. Financial Information Page Number
-----------
<S> <C>
Item 1. Financial Statements
Consolidated Balance Sheets - Assets at March 31, 1997
and December 31, 1996 ........................................................ 3
Consolidated Balance Sheets - Liabilities and Stockholders'
Equity at March 31, 1997 and December 31, 1996................................ 4
Consolidated Statements of Operations for the three months
ended March 31, 1997 and 1996 ................................................ 5
Consolidated Statements of Cash Flows for the three months
ended March 31, 1997 and 1996 ................................................ 6-7
Notes to Consolidated Financial Statements .................................... 8-9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations .................................. 10-12
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K ................................ 13
Signatures .................................................................... 14
Exhibit 11 .................................................................... 15-16
</TABLE>
2
<PAGE> 3
PART 1. FINANCIAL INFORMATION
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS March 31, 1997 December 31, 1996
--------------- -----------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents ................ $ 71,373,000 $ 77,439,000
Short-term investments ................... 66,642,000 74,823,000
Accounts receivable, less allowances for
doubtful accounts of $2,567,000
and $2,573,000, respectively .......... 26,738,000 24,515,000
Other current assets ..................... 9,837,000 11,694,000
--------------- -----------------
Total current assets ..................... 174,590,000 188,471,000
Long-Term Investments:
Marketable securities .................... 104,987,000 92,766,000
Other .................................... 21,225,000 20,869,000
--------------- -----------------
126,212,000 113,635,000
Property and Equipment:
Buildings and improvements ............... 50,399,000 36,450,000
Computer equipment and software .......... 42,369,000 39,642,000
Office furniture and equipment ........... 19,344,000 19,036,000
--------------- -----------------
112,112,000 95,128,000
Less accumulated depreciation and
amortization .......................... (51,415,000) (48,472,000)
--------------- -----------------
Net property and equipment ............... 60,697,000 46,656,000
Other Assets ................................ 4,985,000 4,576,000
--------------- -----------------
$ 366,484,000 $ 353,338,000
=============== =================
</TABLE>
3
<PAGE> 4
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
- -------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
-------------- -----------------
<S> <C> <C>
Current Liabilities:
Accounts payable .................... $ 7,781,000 $ 8,574,000
Accrued expenses .................... 10,513,000 10,811,000
Treasury stock purchase payable ..... 10,055,000 --
Claims reserves ..................... 8,483,000 8,750,000
Income taxes payable ................ 12,311,000 --
-------------- -----------------
Total current liabilities ........... 49,143,000 28,135,000
Non-Current Liabilities ............... 1,904,000 1,997,000
-------------- -----------------
Total liabilities ................... 51,047,000 30,132,000
Commitments and Contingencies ......... -- --
Stockholders' Equity:
Common stock ........................ 372,000 372,000
Additional paid-in capital .......... 134,361,000 129,147,000
Retained earnings ................... 309,899,000 289,065,000
Unrealized holding gain on marketable
securities ....................... 416,000 1,125,000
Treasury stock, at cost ............. (129,611,000) (96,503,000)
-------------- -----------------
Total stockholders' equity .......... 315,437,000 323,206,000
-------------- -----------------
$ 366,484,000 $ 353,338,000
============== =================
</TABLE>
4
<PAGE> 5
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
- -----------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended March 31,
---------------------------
1997 1996
------------ ------------
<S> <C> <C>
Revenues ......................... $64,921,000 $59,985,000
------------ ------------
Operating expenses:
Cost of services ............... 18,543,000 17,842,000
Selling and marketing .......... 7,209,000 7,240,000
General and administrative ..... 3,658,000 3,393,000
Healthcare benefits ............ 2,092,000 830,000
Depreciation and amortization .. 3,088,000 2,760,000
Interest income, net ........... (3,491,000) (2,852,000)
------------ ------------
31,099,000 29,213,000
------------ ------------
Income before income taxes ....... 33,822,000 30,772,000
Income taxes ..................... (12,988,000) (11,822,000)
------------ ------------
Net income ....................... $20,834,000 $18,950,000
============ ============
Weighted average common and
common share equivalents ......... 34,157,000 35,645,000
============ ============
Net income per common share ...... $.61 $.53
============ ============
</TABLE>
5
<PAGE> 6
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------
1997 1996
------------ --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers .......................... $61,921,000 $57,692,000
Cash paid to suppliers and employees .................. (28,783,000) (28,299,000)
Healthcare benefits paid .............................. (973,000) (572,000)
Interest received, net ................................ 3,325,000 2,553,000
Income taxes paid, net ................................ (465,000) (1,380,000)
------------ --------------
Net cash provided by operating activities ............. 35,025,000 29,994,000
------------ --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investments .............................. (38,246,000) (60,313,000)
Sales of investments .................................. 32,346,000 50,863,000
Acquisition of businesses, net of cash acquired ....... -- (7,073,000)
Purchase of property and equipment .................... (17,075,000) (2,220,000)
------------ --------------
Net cash used in investing activities ................. (22,975,000) (18,743,000)
------------ --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of treasury stock ............................ (23,053,000) (5,038,000)
Proceeds from issuance of common stock ................ 1,585,000 8,923,000
Proceeds from sale of put options on common stock ..... 3,352,000 --
------------ --------------
Net cash provided by (used in) financing activities ... (18,116,000) 3,885,000
------------ --------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ..... (6,066,000) 15,136,000
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD ........... 77,439,000 74,599,000
------------ --------------
CASH AND CASH EQUIVALENTS, END OF PERIOD ................. $71,373,000 $89,735,000
============ ==============
SUPPLEMENTAL CASH FLOW DATA:
Acquisition of businesses:
Fair value of assets acquired ......................... $19,246,000
Cost in excess of net assets acquired ................. 3,123,000
Fair value of liabilities assumed ..................... (11,204,000)
Future payments on acquisition ........................ (4,092,000)
--------------
Net cash paid ......................................... $7,073,000
==============
NON-CASH FINANCING ACTIVITY:
Treasury stock purchase payable ....................... $10,055,000
============
</TABLE>
6
<PAGE> 7
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended March 31,
---------------------------
1997 1996
----------- --------------
<S> <C> <C>
RECONCILIATION OF NET INCOME TO NET CASH PROVIDED BY
OPERATING ACTIVITIES:
NET INCOME ............................................... $20,834,000 $18,950,000
----------- --------------
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Depreciation and amortization ...................... 3,088,000 2,760,000
Change in provision for uncollectible receivables .. (6,000) 114,000
Amortization of bond premiums ...................... 442,000 425,000
Tax benefit from stock options exercised ........... 277,000 3,468,000
Unrealized holding loss on
marketable securities ............................ 446,000 239,000
Other, net ......................................... (109,000) (288,000)
Changes in Assets and Liabilities:
Accounts receivable ................................ (2,217,000) (2,479,000)
Other current assets ............................... 1,857,000 315,000
Accounts payable and accrued expenses .............. (1,091,000) (201,000)
Claims reserves .................................... (267,000) (82,000)
Income taxes payable ............................... 12,311,000 7,142,000
Non-current assets and liabilities ................. (540,000) (369,000)
----------- --------------
TOTAL ADJUSTMENTS ..................................... 14,191,000 11,044,000
----------- --------------
NET CASH PROVIDED BY OPERATING ACTIVITIES ............. $35,025,000 $29,994,000
=========== ==============
</TABLE>
7
<PAGE> 8
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. The unaudited financial statements herein have been prepared by the
Company pursuant to the rules and regulations of the Securities and
Exchange Commission. The accompanying interim financial statements have
been prepared under the presumption that users of the interim financial
information have either read or have access to the audited financial
statements for the latest fiscal year ended December 31, 1996.
Accordingly, footnote disclosures which would substantially duplicate the
disclosures contained in the December 31, 1996 audited financial
statements have been omitted from these interim financial statements.
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. Although the Company believes that the disclosures
are adequate to make the information presented not misleading, it is
suggested that these interim financial statements be read in conjunction
with the financial statements and the notes thereto included in the
Company's latest Annual Report on Form 10-K.
2. On February 1, 1996, the Company acquired American Life and Health
Insurance Company and its subsidiary Cambridge Life Insurance Company for
approximately $11.2 million in cash of which $7.1 million was paid at
closing, $3.1 million was paid in the second quarter of 1996 and $1.0
million will be paid when certain contingencies are resolved. The
acquisition was accounted for by the purchase method and, accordingly, the
results of operations of the acquired businesses have been included in the
accompanying consolidated financial statements from the date of
acquisition. The estimated fair market value of net assets acquired was
$8,042,000, net of cash acquired. The excess of purchase price over
estimated fair market value has been allocated to goodwill which is being
amortized over 20 years. The pro forma effect of the acquisition on the
consolidated results of the Company is not material.
3. The Company's investments in marketable securities which are classified
as available for sale had a net unrealized loss in market value of
$709,000, net of deferred income taxes, for the three months ended March
31, 1997. The net unrealized gain at March 31, 1997, included as a
component of stockholders' equity, was $416,000, net of deferred income
taxes. The Company's $12,561,000 investment in a limited partnership is
carried at cost. The current value of the Company's interest in the
limited partnership at March 31, 1997, as reported by the partnership, was
$14,108,000. In the third quarter of 1995, the Company invested in
another limited partnership which invests in equipment which is leased to
third parties. This investment is accounted for on the equity method
since the Company owns 20% of the limited partnership's assets. The
Company's proportionate share of the partnership's income was $115,000 for
the three months ended March 31, 1997 and is included in interest income.
4. On August 8, 1996, the Company announced that the Board of Directors had
approved the repurchase of up to 5,000,000 shares, or approximately 15% of
the Company's then outstanding Common Stock. Purchases may be made from
time to time, depending on market conditions and other relevant factors.
During the first quarter of 1997, the Company
8
<PAGE> 9
repurchased 806,000 shares for a total cost of approximately $33.1 million
($10.1 million of which was paid subsequent to March 31, 1997) or an
average of $41.07 per share. During 1996, the Company repurchased
approximately 1,412,000 shares for a total cost of approximately $56.1
million or an average of $39.74 per share. Approximately 567,000 of these
shares were purchased under the 1996 repurchase plan and 845,000 shares
were repurchased under a prior plan. Such shares are recorded as treasury
shares, at cost, and can be used for general corporate purposes.
In connection with this stock repurchase program, the Company sold put
options in 1996 which obligate the Company, at the election of the option
holders, to repurchase up to 2,000,000 shares of Common Stock at prices
ranging from $40.25 to $42.875 per share. The proceeds from the sale of
these options in the amount of $6,728,000 was recorded as additional
paid-in-capital. During the first quarter of 1997, the Company sold
2,500,000 put options which obligate the Company to repurchase shares at
prices ranging from $40.00 to $41.00 per share. The proceeds from sale of
these options in the amount of $3,352,000 was recorded as paid-in-capital.
As of March 31, 1997, 2,750,000 of the 4,500,000 put options have
expired. Subsequent to March 31, 1997, the Company sold an additional
2,595,000 put options for $5,547,000 with option prices ranging from
$38.45 to $40.50. The outstanding put options expire at various dates
from May 16, 1997 through March 2, 1998.
5. On May 8, 1997 the Company announced it had signed a definitive agreement
under which COMPARE will acquire Loyalty Life Insurance Company (Loyalty).
Loyalty is an insurer with licenses to conduct health insurance business
in 49 states, which will have no net insurance liabilities at the time of
its acquisition by COMPARE. Under the terms of the acquisition, which
will be accounted for as a purchase, COMPARE will pay a maximum of
approximately $13.5 million subject to the satisfaction of certain
contingencies. Loyalty will have net assets of approximately $8 million
which results in a net acquisition cost of approximately $5.5 million.
6. The Company has not yet adopted Statement of Financial Accounting
Standards No. 128 (SFAS No. 128), "Earnings Per Share". SFAS No. 128 is
effective for fiscal periods ending after December 15, 1997, but early
adoption is prohibited. If the Company had adopted SFAS No. 128, Basic
Earnings Per Share would have been $.62 and $.54 for the three months
ended March 31, 1997 and 1996, respectively. Diluted Earnings Per Share
would have been $.61 and $.53 for the three months ended March 31, 1997
and 1996, respectively.
9
<PAGE> 10
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
(UNAUDITED)
- ------------------------------------------------------------------------------
RESULTS OF OPERATIONS
Revenues for the three months ended March 31, 1997 increased 8% or
$4,936,000 from the comparable period of 1996. The Company's revenues consist
of fees for cost management services provided under contracts which typically
require clients to pay based upon a percentage of savings or on a predetermined
contractual basis (fee-based revenue). The Company also derives revenues based
on a fixed monthly fee for each participant, excluding covered dependents, in a
client-sponsored health care plan (capitated revenue) or on a per-transaction
basis. As a result of the Company's acquisition of a life and health insurance
company, the Company also derives an immaterial amount of premium revenue on
life and health insurance contracts.
The following table sets forth information with respect to the sources of
the Company's revenues for the three months ended March 31, 1997 and 1996:
<TABLE>
<CAPTION>
SOURCES OF REVENUE
($ in thousands)
Three Months Ended March 31,
----------------------------------
1997 % 1996 %
------- ------- ------- -------
<S> <C> <C> <C> <C>
PPO $50,896 78% $46,101 77%
Fee Schedule Services 6,299 10 6,260 11
Clinical Cost Management
Services 4,780 7 5,473 9
Premiums, Net 2,946 5 1,381 2
Government Contract
Services -- -- 770 1
------- ------- ------- -------
Total $64,921 100% $59,985 100%
======= ======= ======= =======
</TABLE>
The growth in revenue during the three months ended March 31, 1997 from
the comparable period of 1996 is primarily attributable to the expansion and
development of the Company's PPO services. PPO revenue increased $4,795,000
(10%) from the same period of 1996. This growth is the result of new client
additions and increased utilization of the PPO network by existing clients.
Revenue from fee schedule services increased slightly ($39,000) from the
comparable period in 1996. Premium revenue increased $1,565,000 (113%) for the
three months ended March 31, 1997 from the comparable period in 1996 due
primarily to new client activity.
10
<PAGE> 11
Revenue from clinical cost management services decreased $693,000 (13%)
for the three months ended March 31, 1997 from the comparable period in 1996.
Government contract revenue decreased $770,000 from the same period in 1996 due
to the completion of the Company's CHAMPUS contract with the Department of
Defense.
Cost of services increased $701,000 (4%) for the three months ended March
31, 1997 from the comparable period of 1996. Cost of services consists
primarily of salaries for personnel involved in PPO administration, development
and expansion, utilization management programs, fee schedule and other cost
management services offered by the Company. To a lesser extent, cost of
services includes telephone expenses, facility expenses and information
processing costs. The increase in these costs is primarily attributable to
expenses associated with the development of the Company's risk based products
and, to a lesser extent, expenses incurred in the expansion and development of
the Company's PPO network.
Selling and marketing costs for the three months ended March 31, 1997 were
essentially unchanged from the comparable period of 1996.
General and administrative costs for the three months ended March 31, 1997
increased $265,000 (8%) from the comparable period of 1996. This increase is
primarily attributable to the general insurance expenses incurred by the
Company's insurance subsidiary. To a lesser extent, the increase relates to
salaries and benefits incurred in the executive and administrative areas of the
Company.
Healthcare benefits represent losses incurred by insureds of the Company's
insurance entity. The loss ratio (losses as a percent of premiums) was 71% for
the three months ended March 31, 1997 compared to 60% for the comparable period
of 1996. Due to the small size of the insurance business, this expense is
expected to be volatile until the Company is able to institute all of its
managed care services and cost controls and increase the size of its insurance
business.
Depreciation and amortization expenses increased $328,000 (12%) for the
three months ended March 31, 1997 from the comparable period of 1996 due
primarily to purchases of computer hardware and software as well as the
purchase of the Company's Phoenix facility. Depreciation expense as a percent
of revenue remained constant at 5%.
Interest income for the three months ended March 31, 1997 increased
$639,000 (22%) from the same period in 1996 although the amount of cash
equivalents and investments has only increased 3% since March 31, 1996. This
increase is due primarily to the Company investing in longer term investments
with higher yields.
Net income for the three months ended March 31, 1997, increased $1,884,000
(10%) from the comparable period of 1996. This increase is due primarily to
the revenue growth as well as efficiencies achieved in the Company's
operations.
Net income per share for the three months ended March 31, 1997 increased
15% from the comparable period of 1996. The increase in net income per share
was favorably impacted by the repurchase of approximately 2,218,000 shares of
Company common stock between March 31, 1996 and March 31, 1997.
11
<PAGE> 12
LIQUIDITY AND CAPITAL RESOURCES
The Company had $125,447,000 in working capital at March 31, 1997 compared
with working capital of $158,339,000 at December 31, 1996. The decrease is
primarily attributable to the purchase of the building which houses the
Company's Phoenix operations for $14,000,000 as well as the repurchase of
806,000 shares of Company Common Stock for a total cost of $33,108,000 ($10.1
million of which is payable at March 31, 1997) in the first quarter of 1997.
Investment activities used $22,975,000 of cash representing net purchases of
investments of $5,900,000 and purchases of fixed assets of $17,075,000
(including $14,000,000 for the Phoenix building). Financing activities used
$18,116,000 of cash representing $23,053,000 in purchases of treasury stock
during the three months ended March 31, 1997 partially offset by $1,585,000 in
proceeds from issuance of common stock and $3,352,000 in proceeds from sale of
put options. Through the first three months of the year, operating activities
provided $35,025,000 of cash.
The Company believes that its working capital, long-term investments, and
cash generated from future operations will be sufficient to fund the Company's
anticipated operations and expansion plans.
12
<PAGE> 13
PART II
Item 6. Exhibits and Reports on Form 8-K
Exhibits:
(a) Exhibit 11.1 - Computation of Primary Earnings Per Common Share
(b) Exhibit 11.2 - Computation of Fully Diluted Earnings
Per Common Share
Reports on Form 8-K:
None
13
<PAGE> 14
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.
HealthCare COMPARE Corp.
Dated: May 12, 1997 /s/James C. Smith
-------------------------------------
James C. Smith
President and Chief Executive Officer
Dated: May 12, 1997 /s/Joseph E. Whitters
-------------------------------------
Joseph E. Whitters
Chief Financial Officer
(Principal Financial and Accounting Officer)
14
<PAGE> 1
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES EXHIBIT 11.1
COMPUTATION OF PRIMARY EARNINGS PER COMMON SHARE
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------
1997 1996
----------- -----------
<S> <C> <C>
Net income ...................................... $20,834,000 $18,950,000
=========== ===========
Weighted average number of common shares
outstanding:
Shares outstanding from beginning of period .. 33,697,000 34,635,000
Other issuances of common stock .............. 31,000 258,000
Purchases of treasury stock (202,000) (73,000)
Common Stock Equivalents:
Additional equivalent shares issuable from
assumed exercise of common stock options .... 631,000 825,000
----------- -----------
Weighted average common and common share
equivalents .................................... 34,157,000 35,645,000
=========== ===========
Net income per common share ..................... $ .61 $ .53
=========== ===========
</TABLE>
<PAGE> 1
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES EXHIBIT 11.2
COMPUTATION OF FULLY DILUTED EARNINGS PER COMMON SHARE
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------
1997 1996
----------- -----------
<S> <C> <C>
Net income ..................................... $20,834,000 $18,950,000
=========== ===========
Weighted average number of common shares
outstanding:
Shares outstanding from beginning of period .. 33,697,000 34,635,000
Other issuances of common stock .............. 31,000 258,000
Purchases of treasury stock .................. (202,000) (73,000)
Common Stock Equivalents:
Additional equivalent shares issuable from
assumed exercise of common stock options .... 631,000 888,000
----------- -----------
Weighted average common and common share
equivalents .................................... 34,157,000 35,708,000
=========== ===========
Net income per common share .................... $.61 $.53
=========== ===========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 71,373
<SECURITIES> 171,629
<RECEIVABLES> 29,305
<ALLOWANCES> (2,567)
<INVENTORY> 0
<CURRENT-ASSETS> 174,590
<PP&E> 112,112
<DEPRECIATION> (51,415)
<TOTAL-ASSETS> 366,484
<CURRENT-LIABILITIES> 49,143
<BONDS> 0
0
0
<COMMON> 372
<OTHER-SE> 315,065
<TOTAL-LIABILITY-AND-EQUITY> 366,484
<SALES> 0
<TOTAL-REVENUES> 68,412
<CGS> 0
<TOTAL-COSTS> 31,502
<OTHER-EXPENSES> 3,088
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 33,822
<INCOME-TAX> 12,988
<INCOME-CONTINUING> 20,834
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 20,834
<EPS-PRIMARY> .61
<EPS-DILUTED> .61
</TABLE>
