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, 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 0-16230
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, 1997, there were 33,772,760 shares of the
Registrant's Common Stock without par value issued and outstanding.
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
<TABLE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Statement of Operations
(Unaudited)
(in thousands, except per share data)
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Revenue:
Software licenses $40,429 $38,675 $123,824 $108,502
Software maintenance and services 46,309 33,102 132,456 94,993
Total revenue 86,738 71,777 256,280 203,495
Cost of revenue:
Cost of licenses 7,758 6,560 22,995 19,313
Cost of maintenance and services 25,047 15,815 72,517 43,302
Total cost of revenue 32,805 22,375 95,512 62,615
Gross profit 53,933 49,402 160,768 140,880
Operating expenses:
Selling and marketing 25,355 27,565 75,066 79,854
Research and development 10,797 8,514 36,212 22,795
General and administrative 3,835 3,787 12,899 12,062
Purchased in-process
research and development - - 20,850 -
Total operating expenses 39,987 39,866 145,027 114,711
Operating income 13,946 9,536 15,741 26,169
Equity in earnings (losses) of affiliates - (630) 80 (89)
Acquisition costs - - - (1,102)
Other income, net 1,197 1,309 2,754 2,017
Income before income taxes 15,143 10,215 18,575 26,995
Income tax expense 3,412 1,836 9,366 5,653
Net income $11,731 $8,379 $ 9,209 $ 21,342
Earnings per share:
Primary $ .33 $ .24 $ .26 $ .61
Fully diluted .33 .24 .26 .61
Common and common equivalent shares:
Primary 35,678 34,706 35,029 34,760
Fully diluted 35,678 34,948 35,029 34,760
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheet
(in thousands)
<CAPTION>
September 30, December 31,
1997 1996
(unaudited)
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 85,642 $ 71,278
Marketable securities 17,826 18,502
Trade accounts receivable, net 74,024 61,743
Other accounts receivable 11,680 7,464
Prepaid expenses 8,441 7,918
Total current assets 197,613 166,905
Marketable securities 13,929 10,509
Property and equipment, at cost:
Computer and other equipment 55,242 49,376
Office furniture and equipment 16,565 14,535
Leasehold improvements 6,514 5,695
78,321 69,606
Less accumulated depreciation and amortization 54,769 48,661
Net property and equipment 23,552 20,945
Computer software construction costs, net 30,564 28,614
Other assets 11,530 11,106
Total assets $277,188 $238,079
</TABLE>
See accompanying notes to consolidated financial statements.
<TABLE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheet
(in thousands, except per share data)
<CAPTION>
September 30, December 31,
1996 1996
(unaudited)
<S> <C> <C>
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 12,831 $ 9,695
Accrued expenses 43,579 36,045
Accrued litigation settlement and related costs 10,104 10,104
Accrued income taxes 8,426 8,082
Deferred revenues 43,732 36,460
Total current liabilities 118,672 100,386
Other long-term liabilities 7,311 8,394
Shareholders' equity:
Common stock, stated value $.0069 per share
Authorized 100,000 shares; outstanding shares -
33,744 and 32,760 net of 1,523 and 1,542 shares
in treasury 234 228
Capital in excess of stated value 102,388 87,292
Retained earnings 50,719 41,510
Foreign currency translation (2,128) 298
Unrealized holding loss on investments (8) (29)
Total shareholders' equity 151,205 129,299
Total liabilities and shareholders'equity $ 277,188 $238,079
/TABLE
<PAGE>
<TABLE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statement of Cash Flows
(Unaudited)
(in thousands)
<CAPTION>
Nine Months Ended September 30,
1997 1996
<S> <C> <C>
Net cash provided by operating activities $54,816 $ 23,048
Cash flows from investing activities:
Sales, (purchases) of marketable securities, net (2,723) (9,156)
Additions to property and equipment, net (9,445) (9,832)
Additions to computer software construction costs (7,746) (5,662)
Acquisition of Metaphase Technology, Inc. (28,050) -
Investment in and advances to joint ventures - 300
Net cash used in investing activities (47,964) (24,350)
Cash flows from financing activities:
Stock issued under employee benefit plans 11,324 13,406
Purchases of treasury stock (1,386) (1,382)
Repayment of long term debt - (1,648)
Payment of Camax dissenter's rights - (1,236)
Net cash provided by financing activities 9,938 9,140
Effect of exchange rate changes on cash (2,426) 76
Increase in cash and cash equivalents 14,364 7,914
Cash and cash equivalents:
Beginning of period 71,278 61,848
End of period $85,642 $ 69,762
</TABLE>
See accompanying notes to consolidated financial statements.<PAGE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
(in thousands, except per share data)
(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.
While the Company believes that the disclosures are adequate to
make the information not misleading, these financial statements
should be read in conjunction with the Consolidated Financial
Statements and related notes included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996.
(2) Acquisition of Metaphase Technology, Inc. In 1992, the Company
and Control Data Systems, Inc. (CDSI) established a joint venture
company, Metaphase Technology, Inc., (Metaphase), to develop and
market product data management (PDM) software worldwide. The
Company initially owned a 35% interest and increased such interest
to 50% during 1993. The Company's investment in Metaphase
was accounted for on the equity basis.
In January 1997, the Company acquired the remaining stock of
Metaphase and certain assets of CDSI's global PDM software sales
and support business. The purchase price of approximately $34,000
included cash and a stock warrant. The warrant is exercisable for
750 shares of the Company's common stock without par value at the
exercise price of $28 per share and expires on December 31, 1998.
A value of $3,500 has been assigned to the warrant and recorded
in Shareholders' equity. The excess of purchase price over the
fair values of the net assets acquired is approximately $2,307
and has been recorded as goodwill. Certain other intangibles,
including computer software construction cost, total approximately
$8,555 and have been recorded on the balance sheet. All intangibles
associated with the acquisition are being amortized over their
useful lives, which do not exceed seven years. Also in connection
with the acquisition, the Company recorded a onetime charge to
operations of $20,850 for the write off of in-process research and
development acquired in the transaction that did not have an
alternative future use and had not reached technological
feasibility. The acquisition was accounted for using the
purchase method. The Company's consolidated statement of
operations includes the operating results of Metaphase and the
CDSI assets acquired, beginning January 1, 1997.
(3) Taxes
The provision for income taxes reflects taxes currently
payable. Based on the Company's historical tax position and
estimates of taxable income for the next four years, a valuation
allowance is provided against deferred tax assets when the Company
believes it is more likely than not that the deferred tax
assets will not be realized. These factors cause the effective
tax rate to differ from the expected statutory rate.
(4) New Accounting Pronouncements
Earnings Per Share
In February 1997, the Financial Accounting Standards Board
(FASB) issued Statement of Financial Accounting Standards No. 128
(SFAS No. 128), "Earnings per Share" which establishes new
methods for the computation, presentation and disclosure of
earnings per share. SFAS 128 will be effective for financial
statements of annual and interim periods ending after December 15,
1997. The Company plans to adopt SFAS No. 128 in the fourth
quarter 1997, and at that time all historical net income per
share disclosures will be restated to conform to the provisions
of SFAS No. 128. The impact of SFAS No. 128 on the calculation of
diluted earnings per share for the quarters presented is not
expected to be material.
Comprehensive Income
In June 1997, FASB issued SFAS No. 130, Reporting Comprehensive
Income, which establishes standards for reporting and display
of comprehensive income and its components in the consolidated
financial statements. Comprehensive income includes net income as
well as other changes in shareholder equity, except changes
resulting from shareholders' investments in the Company and
distributions to shareholders. SFAS No. 130 is
effective for fiscal years beginning after December 15, 1997.
The Company has not determined the effects that SFAS No. 130 will
have on its consolidated financial statements.
Segments of an Enterprise
In June 1997, FASB issued SFAS No. 131, Disclosures about Segments
of an Enterprise and Related Information, which establishes
standards for the way that public companies report selected
information about operating segments. It also includes standards
for related disclosures about products and services, geographic
areas, and major customers. SFAS No. 131 is effective for
periods beginning after December 15, 1997. The Company has not
determined the effects, if any, that SFAS No. 131 will have on
the disclosures in its consolidated financial statements.
Revenue Recognition
In August 1997, FASB approved the American Institute of Certified
Public Accountants statement of Position (SOP) on software revenue
recognition which will be effective for fiscal years beginning
after December 15, 1997. The Company believes it is in compliance
with the provisions of the new SOP and its adoption is not expected
to have a material impact on the financial position or results of
operations of the Company.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. (in thousands)
Structural Dynamics Research Corporation is a leading international
supplier of CAD/CAM/CAE and product data management (PDM) software
and related services. The Company provides software and related
services to manufacturers to optimize product performance and
reduce cost, while streamlining the product development process from
concept through manufacturing.
Certain statements in this Form 10Q are forward looking statements
that involve risks and uncertainties, including the timely
availability and acceptance of new products, the impact of
competitive products and pricing, the management of growth, and the
other risks detailed from time to time in the Company's Securities
and Exchange Commission reports. The Company's results could
differ from those results described herein. Forward looking
information should be evaluated in the context of these and other
factors, some of which are described in more detail in Factors That
May Affect Future Results.
Acquisition of Metaphase Technology, Inc.
In January 1997, the Company acquired the remaining stock of
Metaphase Technology, Inc., (Metaphase), and certain assets of
Control Data Systems, Inc.'s (CDSI) global PDM software sales and
support business. The purchase price of approximately $34,000
included cash and a stock warrant. The acquisition was accounted
for as a purchase. During the three months ended March 31, 1997 the
Company recorded a one-time charge of $20,850 to write off
in-process research and development acquired in the acquisition that
did not have an alternative future use and had not reached
technological feasibility.
Revenue
The Company's consolidated net revenue increased 26% to $256,280
for the nine months ended September 30, 1997, compared to $203,495
for the nine months ended September 30, 1996. Quarterly revenue
increased 21% to $86,738 for the three months ended September 30,
1997, compared to $71,777 for the three months ended September 30,
1996.
Software license revenue increased 14% to $123,824 for the nine
months ended September 30, 1997, compared to $108,502 for the nine
months ended September 30, 1996. Quarterly software license
revenue increased 5% to $40,429 for the three months ended September
30, 1997 compared to $38,675 for the three months ended September
30, 1996. Software license revenue growth for PDM products was 363%
and 144%, for the three and nine month periods ended September 30,
1997. The growth was the result of significant sales orders from
major automotive, aerospace and electronics customers. Software
license revenue for CAD/CAM/CAE products was -17% and 1% for the
three and nine months periods ended September 30, 1997. Comparisons
for the quarter and year were impacted by a $2,900 license order
from a large automotive customer booked in the third quarter of
1996. In addition, CAD/CAM/CAE license revenue from Asia-Pacific
operations was less than expected, impacted by the timing of
customer orders and regional economic uncertainty.
Software maintenance and services revenue increased 39% to $132,456
for the nine months ended September 30, 1997, compared to $94,993
for the nine months ended September 30, 1996. Quarterly software
maintenance and services revenue increased 40% to $46,309 for the
three months ended September 30, 1997, compared to $33,102 for the
three months ended September 30, 1996. Growth in maintenance
revenue was due to the increase in the Company's installed customer
base and the Company's continued efforts, through product
development and marketing, to obtain maintenance contract renewals
from its customers. Software services revenue continued to grow due
to increased work on implementation and related projects for I-DEAS
and Metaphase license customers.
For the three and nine month periods ended September 30, 1997,
revenue in North America accounted for 46% and 50%, Europe 33% and
30%, and Asia-Pacific 21% and 20%, respectively, of consolidated
revenues. The Company expects the international market to continue
to account for a significant portion of total revenue.
Expenses
Cost of revenue consists principally of the staff and related costs
associated with the generation and support of software service
revenue, amortization of capitalized software construction costs,
royalty fees paid to third parties under licensing agreements and
the cost of distributing software products. Cost of revenue
Expenses (continued)
increased 53% to $95,512 for the nine months ended September 30,
1997, compared to $62,615 for the nine months ended September 30,
1996. Quarterly cost of revenue increased 47% to $32,805 for
the three months ended September 30, 1997, compared to $22,375 for
the three months ended September 30, 1996. Cost of revenue
represented 38% and 37% of revenue for the three and nine months
ended September 30, 1997, compared to 31% for the corresponding
1996 periods.
The cost of licenses represented 19% of license revenue for the
three and nine months ended September 30, 1997, compared to 17% and
18% of license revenue for the corresponding 1996 periods.
Quarterly, the increased cost of licenses, relative to license
sales, is due primarily to increased software amortization from
the recent release of I-DEAS Master Series 5. The cost of
services and maintenance represented 54% and 55% of the
associated revenue for the three and nine months ended September
30, 1997, compared to 48% and 46% for the corresponding 1996
periods. Relative to the associated sales, cost of services and
maintenance increased due to the hiring, training and integration
cost associated with expanding the workforce to meet the growing
demand for software implementation, training services and post
license sales support. Also in 1997, the Company allocated more
fixed facility and common overhead expenses to the cost of
services and maintenance due to the large growth of the services
and maintenance workforce.
Selling and marketing expenses consist of the costs associated
with the world-wide sales and marketing staff, advertising and
product localization. Selling and marketing expenses decreased 8%
and 6% for the three and nine months ended September 30, 1997
from the corresponding 1996 periods. Selling and marketing expenses
represented 29% of revenue for the three and nine months ended
September 30, 1997 compared to 38% and 39% for the corresponding
periods in 1996. While the Company expanded its sales force 31%
since September 30, 1996 to 230 people, the net decrease in
selling and marketing expense resulted from certain non-recurring
charges incurred during the nine months ended September 30, 1996.
Those charges included significant expense for a corporate
advertising campaign, bad debt expense and special commission
programs. In 1997, the Company allocated less facility and overhead
costs to selling and marketing expenses, and more to the cost of
services and maintenance as noted above.
Research and development expenses consist primarily of salaries,
benefits, computer equipment costs and facilities associated with
the product development staff. It excludes costs which are
capitalized in accordance with Statement of Financial Accounting
Standards No. 86. Research and development expenses increased to
$10,797 and $36,212 for the three and nine month periods ended
September 30, 1997, from $8,514, and $22,795 for the corresponding
periods in 1996. These expenses were 12% and 14% of total revenue
for the three and nine month periods ending September 30, 1997,
compared to 12% and 11% of total revenue for the same periods in
1996. The increases were due to additions in the development staff
from the Metaphase acquisition as well as staff increments for
I-DEAS product development. Research and development expenses
excluded capitalized internal software costs of $7,697 for the
nine months ended September 30, 1997 compared to $5,517 for the
corresponding period in 1996. The increase in capitalized cost
reflected the higher level of development staff and a timing
difference of new product releases compared to the prior year. The
Company expects the amount of software cost capitalized during
the next several months to increase as production for the next
software release intensifies.
General and administrative expenses consist of costs associated
with the corporate, finance, legal, human resource and
administrative staffs. General and administrative expense
increased to $3,835 and $12,899 for the three and nine month
periods ended September 30, 1997, from $3,787 and $12,062 for
the corresponding periods in 1996. General and administrative
expenses represent 4% and 5% of revenue for the three and nine
months ended September 30, 1997 and 5% and 6% for the three and
nine months ended September 30, 1996. The increase in general and
administrative expenses was primarily due to a larger workforce
to support the Company's growth.
Equity in Earnings of Affiliates
For the nine months ended September 30, 1997, equity in
earnings represented the Company's share of operating results of
its joint venture, ESTECH. For the nine month period ended
September 30, 1996, equity in earnings of affiliates represented
the Company's share of operating results of its joint venture
investee, Metaphase. Since the Company's acquisition of Metaphase
in January, 1997, the operating results of Metaphase are
consolidated in the Company's statement of operations.
Acquisition Cost
In June 1996, the Company completed the acquisition of Camax
Manufacturing Technologies, Inc., (Camax), which was accounted for
as a pooling of interests wherein all historical financial
information was restated to include the results of Camax for
all periods presented. Charges of $1,102 related to the
acquisition were recorded in the second quarter 1996 results.
Other Income, net
Other income, net, consists principally of interest income and
foreign currency losses. For the nine months ended September 30,
1997, other income includes interest income of approximately
$3,550 and foreign exchange losses of approximately $800. The net
increase for the nine month period ended September 30, 1997,
compared to 1996, is due principally to a one-time charge of
approximately $950 for the settlement of a lawsuit in 1996.
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 cause the effective tax
rate to differ from the expected statutory rate.
Liquidity and Capital Resources
At September 30, 1997, the Company had cash and investments of
$117,397 compared to $100,289 at December 31, 1996. During the
first nine months of 1997, the Company generated net cash from
operating activities of $54,816 and realized cash proceeds of
$11,324 from the issuance of stock. The cash generated was
partially offset by cash paid for the Metaphase acquisition
($28,050); purchases of marketable securities ($2,723, net);
payments for equipment purchases ($9,445); computer software
construction ($7,746); and the purchase of treasury stock for
employee benefit plans ($1,386) since December 31, 1996. At
September 30, 1997, the Company's working capital was $78,941.
In addition, the Company has an unused, unsecured bank line of
credit of $15,000. 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 for the foreseeable future.
Factors That May Affect Future Results
Forward looking statements and the Company's results are subject
to certain risks and uncertainties, including those discussed below,
that could cause actual results to differ from those disclosed. Any
risk and uncertainty posed by competitive, technological or
financial factors could have an immediate and significant adverse
effect on the trading price of the Company's stock in any given
period.
Future quarterly results could be impacted by factors such as
customer order delays, 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. The loss of a major customer or a reduction in orders
from a major customer or distributor could have a significant impact
to the results of operations in any particular quarter.
Historically, a significant portion of the Company's revenue is
generated from shipments in the last month of a quarter. In
addition, higher volumes of orders have been experienced in the
second and fourth quarter. The concentration of orders makes
projections of quarterly financial results difficult. If customers
delay their orders or a disruption in the Company's distribution
Factors That May Affect Future Results (continued)
occurs, quarterly results of operations in any particular quarter
may be negatively impacted. The Company usually ships the software
license orders within one to two weeks after receipt of a customer
order. Typically, orders exist at the end of a quarter which have
not been shipped. The value of such orders is not indicative of
revenue results for any future period. A significant portion of
the Company's revenue is from the international market. As a
result, the Company's financial results could be impacted by
weakened general economic conditions, differing technological
advances or preferences, volatile foreign exchange rates and
government trade restrictions in any country in which the Company
does business. The Company relies on distributors, representatives
and value added resellers to market its products. The Company's
revenue in any particular quarter may be negatively impacted by a
lower than anticipated performance of any significant distributor,
representative or value added reseller.
The Company's success is dependent on its ability to continue to
develop, enhance and market new products to meet its customers'
sophisticated needs in a timely manner and which are consistent
with current technological developments. The Company's success
also depends in part on its ability to attract and retain technical
and other key employees who are in great demand, to protect the
intellectual property rights of its products and to continue key
relationships with third party authors. As development cycles
become shorter, product quality, performance, reliability, ease
of use, functionality, breadth and integration may be impacted.
Therefore, customer acceptance of new products cannot be assured.
The software industry is highly competitive. The entire industry
may experience pricing and margin pressure which as a result could
adversely affect the Company's operating results and financial
position.
In addition, the Company's expense levels are based, in part, on
its future revenue expectations. The Company continues to
increase its operating expense levels to meet the growing customer
demand for the Company's products and services. If revenue is
below expectations, operating results could be adversely and
materially affected. Net income may be disproportionately affected
by an unexpected reduction in revenue because the Company's
expense levels are generally committed in advance and a relatively
small portion of the Company's expenses vary with revenue.
During the third quarter of 1997, the Company initiated steps
to expand its sales resources and to invest more in marketing
efforts with the objective of increasing the distribution of license
products. Future results could be impacted by lags in sales
productivity as additional salespeople are hired or by the cost
of new marketing programs. In addition, the Company is in the
process of upgrading its world-wide information management system.
Such a major undertaking could cause significant disruption as a
result of unexpected delays in the implementation of this project.
Factors That May Affect Future Results (continued)
There can be no assurance that the project will be completed
within the projected time frame and budget. The Company does
not anticipate any significant problems associated with the year
2000 consequences for its internal software or the software which
it markets. The software which will be the basis of the Company's
new information management system is Year 2000 compliant. The
Company's primary software offerings are also Year 2000 compliant.
The trading price of the Company's stock, like other software
and technology stocks, is subject to significant volatility due to
factors impacting the overall market which are unrelated to the
Company's performance. The historical results of operations and
financial position of the Company are not necessarily indicative of
future financial performance. If revenues or earnings fail to meet
securities analysts' expectations, there could be an immediate and
significant adverse impact on the trading price of the Company
stock.
The Company has not experienced a material adverse impact of such
risks or uncertainties and does not anticipate such an impact.
However, no assurance can be given that such risks and uncertainties
will not affect the Company's future results of operations or its
financial position.
<PAGE>
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 Per Common Share
11(b) Calculation of Fully Diluted Earnings Per Common
Share
The information furnished in this report has not been audited. It
reflects all adjustments which are, in the opinion of management,
necessary for a fair statement of the results for the interim
periods reported. The results are not necessarily indicative of
results of operations to be expected for the full fiscal year.
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
Date: November 12, 1997 By: /s/ Jeffrey J. Vorholt
Jeffrey J. Vorholt,
Vice President,
Chief Financial Officer
and Treasurer
* Pursuant to the last sentence of
General Instruction G to Form 10-
Q, Mr. 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.
<PAGE>
EXHIBIT 11(a)
<TABLE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Calculation of Primary Earnings Per Common Share
(in thousands, except per share data)
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
PRIMARY
Average shares outstanding 33,933 33,104 34,638 32,685
Net effect of dilutive stock options
after application of the treasury
stock method 1,745 1,602 391 2,075
Total 35,678 34,706 35,029 34,760
Net income $11,731 $ 8,379 $ 9,209 $21,342
Net income per share $ .33 $ .24 $ .26 $ .61
</TABLE>
<PAGE>
Exhibit 11(b)
<TABLE>
STRUCTURAL DYNAMICS RESEARCH CORPORATION AND SUBSIDIARIES
Calculation of Fully Diluted Earnings Per Common Share
(in thousands, except per share data)
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
FULLY DILUTED
Average shares outstanding 33,933 33,104 34,638 32,685
Net effect of dilutive stock
options after application ofthe
treasury stock method 1,745 1,844 391 2,075
Total 35,678 34,948 35,029 34,760
Net income $ 11,731 $ 8,379 $ 9,209 $21,342
Net income per share $ .33 $ .24 $ .26 $ .61
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 85,642
<SECURITIES> 17,826
<RECEIVABLES> 85,704
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0
0
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