UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the period ended September 30, 1993
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 0-16230
STRUCTURAL DYNAMICS RESEARCH CORPORATION
(Exact name of registrant as specified in its charter)
Ohio 31-0733928
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2000 Eastman Drive, Milford, Ohio 45150
(Address of principal executive offices)
(Zip Code)
(513) 576-2400
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes [X] No [ ]
As of October 31, 1993 there were 28,647,688 shares of the
Registrant's Common Stock without par value issued and outstanding.
The Registrant hereby amends the following items and financial
statements of its Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993 as set forth below. Items not referenced
below are not amended. Items referenced below are amended in their
entirety as set forth below:
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Statement of Operations
For the Three Month and Nine Month Periods
Ended September 30, 1993 and 1992
(Unaudited)
(in thousands, except share data)
Three Months Nine Months
Ended September 30, Ended September 30,
1993 1992 1993 1992
Revenue:
Software products
and services $21,722 $18,762 $68,353 $66,592
Maintenance 8,612 8,102 25,189 22,560
Engineering services 4,723 5,822 15,449 17,063
Net revenue 35,057 32,686 108,991 106,215
Cost and expenses:
Cost of revenue 8,639 8,498 29,052 24,579
Research and
development expenses 6,703 6,576 19,467 17,911
Selling, general and
administrative
expenses 23,832 16,920 67,092 53,950
Total cost
and expenses 39,174 31,994 115,611 96,440
Operating
income (loss) (4,117) 692 (6,620) 9,775
Equity in losses
of affiliate (134) -- (530) --
Other income,
principally interest 482 474 1,257 1,785
Income (loss)
before income
taxes and
cumulative effect
of accounting change (3,769) 1,166 (5,893) 11,560
Income taxes 1,222 432 3,391 4,152
<PAGE>
Income (loss) after
income taxes and
before cumulative
effect of
accounting change (4,991) 734 (9,284) 7,408
Cumulative effect of
accounting change - - - 700
Net income (loss) $(4,991) $734 $(9,284) $8,108
Earnings (loss)
per share:
Before cumulative
effect of
accounting change $(.16) $.02 $(.30) $.24
Cumulative effect of
accounting change - - - .02
Earnings (loss)
per share $(.16) $.02 $(.30) $.26
Average number of
shares of common
stock and common
stock equivalents
outstanding 30,378 29,465 30,786 30,638
See accompanying notes to consolidated financial statements.
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheet
September 30, 1993 and December 31, 1992
(Unaudited)
(in thousands)
September 30, December 31,
1993 1992
Assets
Current assets:
Cash and cash equivalents $ 30,633 $ 31,661
Investments 16,079 20,752
Trade accounts receivable, net 24,135 26,944
Other accounts receivable 7,077 7,993
Prepaid expenses 5,926 4,427
Total current assets 83,850 91,777
Long-term investments 6,532 --
Property and equipment, at cost:
Computer and other equipment 35,683 32,248
Office furniture and equipment 8,901 8,217
Leasehold improvements 3,446 3,449
48,030 43,914
Less accumulated depreciation and
amortization 31,505 27,243
Net property and equipment 16,525 16,671
Computer software
construction, net 27,471 26,420
Other assets 2,078 1,262
Total assets $ 136,456 $ 136,130
See accompanying notes to consolidated financial statements.
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheet
September 30, 1993 and December 31, 1992
(Unaudited)
(in thousands, except share data)
September 30, December 31,
1993 1992
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 5,291 $ 4,037
Accrued expenses 24,300 20,741
Accrued income taxes 6,140 5,358
Deferred revenue 13,754 13,201
Total current liabilities 49,485 43,337
Deferred income taxes and other 332 346
Shareholders' equity:
Common stock, stated value $.0069
per share; 100,000 authorized
shares in 1993 and 1992;
28,638 issued shares in 1993
and 28,136 issued shares in
1992 net of 1,637 treasury
shares in 1993 and 1,762 in 1992 199 195
Capital in excess of stated value 44,979 41,474
Retained earnings 42,073 51,357
Foreign currency translation
adjustment (612) (579)
Total shareholders' equity 86,639 92,447
Total liabilities and
shareholders' equity $ 136,456 $ 136,130
See accompanying notes to consolidated financial statements.
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statement of Cash Flows
For the Nine Months Ended September 30, 1993 and 1992
(Unaudited)
(in thousands)
Nine Months Ended September 30,
1993 1992
Net cash provided by
operating activities $ 12,165 $ 19,975
Cash flows from
investing activities:
Purchases of investments, net (1,859) (3,662)
Additions to property and
equipment, net (5,014) (6,454)
Additions to computer software
construction costs (8,153) (7,024)
Additions to purchased
computer software (284) (100)
Change in joint venture investment (1,170) --
Other, net (189) 4
Net cash used in
investing activities (16,669) (17,236)
Cash flows from financing activities:
Stock issued under employee
benefit plans 3,547 2,151
Purchases of treasury stock (38) (742)
Net cash provided by
financing activities 3,509 1,409
Effect of exchange rate changes
on cash (33) 291
Increase (decrease) in cash and
cash equivalents (1,028) 4,439
Cash and cash equivalents:
Beginning of period 31,661 31,319
End of period $ 30,633 $ 35,758
See accompanying notes to consolidated financial statements.
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
(in thousands)
(1) Basis of Presentation
The accompanying unaudited consolidated financial statements have
been prepared by the Company pursuant to the rules and regulations
of the Securities and Exchange Commission. As permitted by the
rules of the Securities and Exchange Commission applicable to
quarterly reports on Form 10-Q, these notes are condensed and do
not contain all disclosures required by generally accepted
accounting principles. In the opinion of management, these
financial statements contain all adjustments (consisting of only
normal recurring adjustments, unless otherwise noted) necessary to
present fairly the Company's financial position, results of
operations and cash flows as of the dates and for the periods
indicated.
(2) Restatement of Financial Statements
The financial statements included herein have been restated from
those previously published to reflect correction of errors in the
accounting for (a) revenue recognition and revenue related
expenses, (b) non-recoverable software construction costs and
(c) accrued expenses and losses. Additionally, the related income
tax effects have been adjusted.
(3) Income Taxes
The provision for income taxes reflects taxes currently payable.
Deferred tax benefits relating to temporary differences have been
offset by a valuation allowance due to doubt as to their ultimate
realization. These factors have the impact of disturbing the
effective tax rate from the expected statutory rate.
Effective January 1, 1992 the Company adopted Statement of
Financial Accounting Standards No. 109, "Accounting for Income
Taxes." The effect of applying this statement was to increase net
income by $.02 per share for the nine month period ended September
30, 1992. The adoption has been reflected as a cumulative effect
of a change in accounting principle in these financial statements.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Results of Operations
(in thousands)
Revenue
Consolidated revenue increased by $2,371 (or 7%) and $2,776 (or 3%)
for the three and nine months ended September 30, 1993,
respectively, as compared to the corresponding 1992 periods.
During the third quarter of 1993, software segment revenue
increased $3,470 (or 13%) when compared to the third quarter of
1992. As compared to prior year third quarter, I-DEAS license
revenue increased 27%, maintenance revenue increased 6% and license
revenue from a marketing agreement with a significant customer
increased 6%. For the nine month period software segment revenue
increased $4,390 (or 5%) compared to 1992. As compared to the
prior year's nine month period, I-DEAS license revenue increased
17%, maintenance revenue increased 12% and licenses from a
marketing agreement with a significant customer decreased 40%.
Engineering services segment revenue decreased 19% and 9% for the
three and nine months ended September 30, 1993, respectively, as
compared to the corresponding 1992 periods due to an overall
decrease in consulting activities.
Expenses
Cost of revenue increased 2% and 18% for the three and nine months
ended September 30, 1993, respectively, compared to the
corresponding 1992 periods, primarily due to increased software
amortization cost relating to the release of I-DEAS Master Series
(Trademark) in June 1993.
Due to the Company's continuing commitment to the technological
advancement of its software product line, research and development
expenses increased 2% for the quarter and 9% year-to-date as
compared to the corresponding 1992 periods. This increase was
partially offset by an increase in the amount of software
construction costs capitalized.
Selling, general and administrative expenses increased 41% for the
quarter and 24% for the nine months ended September 30, 1993 over
the corresponding 1992 periods, primarily due to expense of $4,200
for the settlement of a claim by a significant OEM customer. In
addition, the Company continued to expand the field sales and
support organization and also increased general corporate expenses.
Other
Interest income has decreased for the nine months as compared to
the same period in 1992 due to declining interest rates. In 1992,
other income for the nine month period also included a gain on the
sale of a stock investment.
In 1993, the equity in losses of affiliate represents the Company's
share of the start-up loss of Metaphase Inc., a joint venture
company formed in late 1992, which develops and markets product
data management (PDM) software.
Taxes
The provision for income taxes reflects currently payable.
Deferred tax benefits relating to temporary differences have been
offset by a valuation allowance due to doubt as to their ultimate
realization. These factors have the impact of disturbing the
effective tax rate from the expected statutory rate.
Effective January 1, 1992, the Company adopted Statement of
Financial Accounting Standards No. 109, "Accounting for Income
Taxes". The effect of initially applying this statement was to
increase net income by $700 or $.02 per share for the nine month
period ended September 30, 1992. The adoption has been reflected
as a cumulative effect of a change in accounting principles in
these financial statements.
Quarterly Results
Future quarterly results could be impacted by factors such as order
deferrals, a slower growth rate in the market, increased
competition or adverse changes in general economic conditions in
any of the countries in which the Company does business. Any
shortfall in revenue or earnings could have an immediate and
significant adverse effect on the trading price of the Company's
stock in any given period.
Liquidity and Capital Resources
At September 30, 1993, the Company had cash and investments of
$46,712. The Company has no current commitments for material
capital expenditures. These existing sources of liquidity and
funds anticipated to be generated from operations are expected to
provide adequate cash to fund the Company's projected needs in the
foreseeable future.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(A) Exhibits filed as part of this report:
11(a) Calculation of Primary Earnings (Loss) Per Common
Share
11(b) Calculation of Fully Diluted Earnings (Loss) Per
Common Share
(B) Reports on Form 8-K filed during the quarter ended
September 30, 1993: None
SIGNATURE
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.
STRUCTURAL DYNAMICS RESEARCH CORPORATION
January 13, 1995 By: /s/ Jeffrey J. Vorholt
(Date) (Jeffrey J. Vorholt,
Vice President and Controller)
*Pursuant to the last sentence
of General Instruction G to
Form 10-Q, Jeffrey J. Vorholt
has executed this Quarterly
Report on Form 10-Q both on
behalf of the registrant and
in his capacity as its
principal financial and
accounting officer.
EXHIBIT 11(a)
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Calculation of Primary Earnings (Loss) Per Common Share
(in thousands, except share data)
Three Months Nine Months
Ended September 30, Ended September 30,
1993 1992 1993 1992
Income (loss)
after income taxes
and before cumulative
effect of accounting
change $ (4,991) $ 734 $ (9,284) $ 7,408
Cumulative effect of
accounting change -- -- -- 700
Net income (loss) $ (4,991) $ 734 $ (9,284) $ 8,108
Average Number of
Shares of Common
Stock and Common
Stock Equivalents
Outstanding 28,572 28,078 28,432 27,824
Average Number of
Common Stock
Equivalents:
Effect of stock
options outstanding
after application
of the treasury
stock method 1,806 1,387 2,354 2,814
30,378 29,465 30,786 30,638
Primary Earnings
(Loss)
Per Common Share:
Before cumulative
effect of
accounting change $ (.16) $ .02 $ (.30) $ .24
Cumulative effect of
accounting change -- -- -- .02
Earnings (loss)
per share $ (.16) $ .02 $ (.30) $ .26
Exhibit 11(b)
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Calculation of Fully Diluted Earnings (Loss) Per Common Share
(in thousands, except share data)
Three Months Nine Months
Ended September 30, Ended September 30,
1993 1992 1993 1992
Income (loss)
after income taxes
and before cumulative
effect of accounting
change $ (4,991) $ 734 $ (9,284) $ 7,408
Cumulative effect of
accounting change -- -- -- 700
Net income (loss) $ (4,991) $ 734 $ (9,284) $ 8,108
Average Number of
Shares of Common
Stock Outstanding 28,572 28,078 28,432 27,824
Average Number of
Common Stock
Equivalents:
Effect of stock
options outstanding
after application
of the treasury
stock method 1,806 1,387 2,354 2,814
30,378 29,465 30,786 30,638
Fully Diluted
Earnings (loss)
Per Common Share:
Before cumulative
effect of accounting
change $ (.16) $ .02 $ (.30) $ .24
Cumulative effect of
accounting change -- -- -- .02
Earnings (loss)
per share $ (.16) $ .02 $ (.30) $ .26
