<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) October 16, 1996
Borland International, Inc.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Delaware 33-80946 94-2895440
- -------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 Borland Way, Scotts Valley, California 95066-3249
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 431-1000
--------------
Not applicable
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS.
On October 16, 1996, Borland International, Inc. ("Borland") announced that
it expected to report a loss for the quarter ending September 30, 1996 of
between $.32 and $.36 per share on revenues of approximately $36 million.
Concurrently, Borland announced a series of actions designed to reduce costs and
improve responsiveness to customers. Such actions include, but are not limited
to, cost and headcount reductions and the realignment of certain operating
functions.
On October 21, 1996, Borland and Corel Corporation ("Corel") entered into a
license agreement (the "License Agreement") whereby Borland granted to Corel
additional license rights with respect to Borland's Paradox database product
line. Under the terms of the License Agreement, Corel is licensing the Paradox
source code from Borland and will assume primary responsibility for development,
marketing, sales and support for the Paradox family of products worldwide.
Borland will continue development of the Borland Database Engine, a technology
shared between Paradox and other Borland products, and will continue to sell
stand-alone versions of Paradox through October 21, 1997. Given the
competitiveness and uncertainties in the desktop database market, there can be
no assurance that Borland's arrangements with Corel will not result in a
reduction of the net profit margin contributed to Borland by the Paradox product
line. In addition, there can be no assurance that the decision to transfer
primary development, marketing, sales and support to Corel will not result in
adverse customer reactions, adverse impacts on sales of other Borland products
or other adverse effects.
On October 24, 1996, Borland announced second quarter results for the
period ended September 30, 1996 that were consistent with the range of
preliminary results released on October 16, 1996. Second quarter revenues were
$36.4 million, compared with revenues of $51.3 million for the second fiscal
quarter of the prior year. The net loss for the quarter was $9.8 million or
$.31 per share, compared with net income of $2.6 million or $.08 per share in
the second quarter a year ago. Total operating expenses for the quarter were
$41.4 million compared to $40.8 million for the same quarter of the previous
year. The net loss for the six months ended September 30, 1996, was $23.9
million or $.76 per share on revenues of $70.9 million compared to net income of
$5.5 million or $.18 per share on revenues of $105.1 million for the prior
fiscal year.
Although Borland has taken certain actions, and intends to take additional
actions, designed to restructure its business with the objective of returning to
profitability and increasing stockholder value, there is no assurance that such
actions will be successful. Borland expects to continue to experience operating
losses, at least through the fiscal year ending March 31, 1997. Among other
matters, Borland's ability to regain profitability will be substantially
dependent upon its ability to successfully complete and introduce new products,
to successfully integrate Open Environment Corporation and to stem the recent
losses of management and other key personnel. There can be no assurance that
Borland will be able to successfully accomplish the foregoing or to regain
profitability in future periods.
2
<PAGE>
In recent months, Borland has experienced significant changes in management
and other key personnel. In particular, Borland has announced the resignation
of its President and Chief Executive Officer, its Senior Vice President for
Research and Development and its Chief Financial Officer. To date, Borland has
only replaced the Chief Financial Officer. In certain cases, management and
other key personnel have been lured away by competitors who have offered very
substantial signing bonuses and compensation packages which would be very
difficult for Borland to match. There can be no assurance that Borland will not
be subject to further losses of management and other key personnel. In
addition, Borland may be required to substantially increase the compensation,
stock options or other benefits offered to employees in order to attract or
retain management and other key personnel. The loss of management and other key
personnel, and the delays which may be experienced in recruiting new management
and other personnel as well as the additional costs which may be incurred in
retaining or attracting new personnel, may have a material adverse affect on
Borland, the timing or quality of its product launches and its operating
results. In particular, the disruptions inherent in such a situation are
particularly problematic for a company which has experienced the types of
problems which Borland has recently faced.
A pending initiative on the November 1996 California ballot would, if
passed by voters and upheld against potential court challenges, subject
corporations and their directors and officers to increased risk of suit and may
prohibit corporations from indemnifying officers and directors and expose
directors and officers of corporations to increased risk of personal liability.
Proposition 211, if passed and upheld, could increase litigation expenses and
the cost of related insurance and adversely affect the financial position and
results of operations of Borland. In addition, the increased risk of personal
liability could interfere with the ability of Borland to attract and retain
directors and officers, which in turn could adversely affect the company's
competitive position.
This Current Report on Form 8-K contains forward-looking statements that
involve risks and uncertainties. Actual future results may differ materially.
Readers are referred to the documents filed by Borland with the Securities and
Exchange Commission, specifically the most recent reports on Form 10-K, 10-Q
and 8-K and its Registration Statement on Form S-4 relating to the pending
acquisition of Open Environment Corporation, which identify important risk
factors that could cause actual results to differ from those contained in the
forward-looking statements.
3
<PAGE>
ITEM 7. EXHIBITS.
(a) Financial statements of business acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
Exhibit No. Description
---------- -----------
99.1 Press Release of Borland dated October 16, 1996.
99.2 Joint Press Release of Borland and Corel dated
October 21, 1996.
99.3 Press Release of Borland dated October 24, 1996.
4
<PAGE>
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 hereunto duly authorized.
BORLAND INTERNATIONAL, INC.
Date: October 31, 1996 By: /s/ Paul W. Emery, II
---------------------
Paul W. Emery, II
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Description Numbered Page
- ------------ ----------- -------------
<S> <C> <C>
99.1 Press Release of Borland dated October 16, 1996.
99.2 Joint Press Release of Borland and Corel dated
October 21, 1996.
99.3 Press Release of Borland dated October 24, 1996.
</TABLE>
<PAGE>
Exhibit 99.1
------------
Press Release of Borland dated October 16, 1996
<PAGE>
FOR IMMEDIATE RELEASE
BORLAND EXPECTS SECOND QUARTER LOSS OF $.32 TO $.36
PER SHARE;
ANNOUNCES COST REDUCTION PROGRAM
SCOTTS VALLEY, Calif.--October 16, 1996--Borland International Inc. today
announced that it expects to report a loss for quarter ending Sept. 30, 1996
of between $.32 and $.36 per share on revenues of approximately $36 million.
Concurrently, the company announced a series of actions designed to reduce
costs, improve responsiveness to customers, return to profitability and
enhance shareholder value.
Paul Emery, vice president and chief financial officer, said that Borland's
cost reduction measures, which ultimately are expected to produce annual
savings from $15 million to $17 million, include a worldwide restructuring and
realignment of its corporate structure to be more consistent with the
strategic direction of the company. These actions will reduce corporate
headcount by approximately 15 percent or 125 individuals.
Whitney Lynn, acting president and chief executive officer, said that the
revised organization structure is designed to simplify the company's
operations, eliminate certain redundancies of functions and focus on
responsiveness to customers requirements, "The layoffs, the cost reductions and
operational streamlining are necessary for Borland's to remain viable and
compete effectively in the emerging Internet/intranet and client/server
marketplaces," he said. Mr. Lynn said that other cost reduction measures
implemented by the company include tighter procedures and cost controls and a
renewed emphasis on achieving operational savings through organizational
efficiencies.
"These efforts are designed to achieve a cost structure more consistent with
revenue expectations," he added.
Borland attributed the losses in the quarter to a slower than expected
transition of its sales, marketing and development efforts in moving from
desktop markets into departmental and corporate technologies. In addition,
market reluctance to adopt client/server products while organizations were
evaluating the impact of new Internet/intranet technologies on their
information strategies. The company said that early responses to the actions
taken during the second quarter to address Borland's desktop products, were,
however, encouraging as resellers reported greater sales of repriced and
repackaged products.
"To address the shift in the market, we are restructuring the company to
reflect our increased commitment to corporate IT s, including departmental and
intranet developers," said Mr. Lynn "When the company was restructured in
1995, the company shifted its strategy to focus on products and services for
the entire software development community. This year, while continuing to
develop for and support our traditional independent developer customer, we are
more closely focusing our efforts and increasing our commitment to
departmental and corporate IT. We are concentrating on those areas where we
feel we have the most potential for future growth."
Borland plans to increase its presence and improve both its credibility and
market penetration at all levels, Lynn said, particularly at the corporate
level.
1 of 2
<PAGE>
Mr. Lynn stated that Borland's product mix now includes software development
tools for the desktop to the enterprise, including the new IntraBuilder tool
suites for intranet development, internet-enablement of its Delphi and C++
development tools and as yet unreleased tools for enterprise java development.
IntraBuilder, launched in the quarter, is Borland's first pure Internet
technologies product which is used to connect corporate data over internal
intranets.
The company also noted that its acquisition of client/server enterprise
software vendor Open Environment Corporation is nearing completion with the
transaction set for closure on November 18.
"Our goal is to increase the sales of existing products while simultaneously
pursuing the delivery of new products into the marketplace," Mr. Lynn said.
"No one disputes the technical superiority of our products nor the
outstanding capabilities of our people," Lynn said. "With these important
strengths, the job of management is to maximize the capabilities of our
software technologies and their market potential to produce improved shareholder
value. With the changes that we are implementing today, we are confident that
we should be able to improve the company's operating results and return to
profitability in fiscal 1998," he said.
This release includes forward-looking statements that involve risks and
uncertainties. Actual future events or results may differ materially. Readers
are referred to the documents filed by Borland with the S.E.C., specifically
the most recent reports on Form 10-K and 10-Q, which identify important risk
factors that could cause actual results to differ from those contained in the
forward-looking statements.
Borland International Inc. (NASDAQ:BORL) is a leading provider of products and
services to software developers. Borland is distinguished for its high-quality
software develpment tools, which include Delphi, Delphi Client/Server,
IntraBuilder, Borland C++, Visual dBASE, Paradox and InterBase. Borland's
award-winning products are supported through comprehensive programs for
small-and larger-sized software developers corporate developers, value added
resellers and systems integrators. Founded in 1983, Borland is headquartered
in Scotts Valley, California.
2 of 2
<PAGE>
Exhibit 99.2
------------
Joint Press Release of Borland and Corel dated october 21, 1996
<PAGE>
FOR IMMEDIATE RELEASE
COREL LICENSES PARADOX DATABASE FROM BORLAND
COREL ASSUMES PARADOX BUSINESS TO ADVANCE LEADERSHIP POSITION IN
DESKTOP SUITES;
BORLAND TO CONTINUE DEVELOPMENT OF PARADOX'S BORLAND DATABASE
ENGINE AND PARTICIPATE IN PARADOX REVENUE STREAMS
SCOTTS VALLEY, Calif. -- October 21, 1996 -- After strong sales of
Corel(R) Office Professional and gaining sales equal to Microsoft in the
US retail channel, Corel will boost marketing and support for the
suite's Borland Paradox database product line through a new license
agreement between the two companies. Effective today, Corel is licensing
the Paradox source code from Borland and will assume responsibility for
development, marketing, sales and support for the Paradox family of
products worldwide. Under the terms of the license agreement, Borland
will continue development of the Borland Database Engine, a key
technology found in Paradox and other Borland products, and will
continue to sell stand-alone versions of Paradox through October 21,
1997 as a customer service to Borland corporate customers.
Paradox is the award-winning Windows database from Borland that has been
included in Corel Office Professional through a previous alliance
between the companies. As part of Corel's future plans for Paradox, a
forthcoming release of Paradox will include web development capabilities
and increased support for popular application development tools, such as
Borland's Delphi.
"Since acquiring the PerfectOffice Suite from Novell in March of 1996,
Corel has made huge gains in market share," said Dr. Michael Cowpland,
president and chief executive officer of Corel Corporation. "This license
agreement will help Corel further its leadership position in the suite
business, improve integration and extend customers investment in Paradox
through Corel s increased support for the product."
"With the overwhelming success of Corel Office Professional, it's clear
that suites hold the future for end-user databases," said Michael
Greenbaum, vice president of worldwide marketing for Borland. "Borland
will be working closely with Corel over the coming months to ensure a
smooth transition for customers and channel partners worldwide. Corel's
leadership in the suite business and its new focus on Paradox will
enable a long, successful future for Paradox."
"This licensing agreement will enable Corel's marketing and development
teams to move forward with this award-winning database program and
further integrate it into their office suite," said Joan-Carol Brigham,
industry analyst with International Data Corporation. "It's definitely a
win-win situation for both companies."
Effective immediately, customer service, future product development for
Paradox, and sales and marketing will be supported by Corel. Borland
will provide technical support for Paradox through November 21, and will
continue to offer customer service to existing Paradox customers. After
that date, customers calling Borland will be directed to Corel. Borland
Japan will continue its current marketing, sales and support for another
year during the transition period, while Corel will also bundle Paradox
in their Japanese suite starting October 21. Following the 12 month
transition period, Borland Japan will transition all Paradox related
business including such functions as product development,
1 of 2
<PAGE>
sales, marketing, and distribution to Corel. Borland employees
supporting Paradox will remain with Borland and will be re-deployed to
its client/server and Internet/intranet product areas.
"Borland and Corel have worked closely together for the past several
months, added Cowpland. "We look forward to working with Borland, our
Paradox customers and channel partners to ensure the product's ongoing
success."
ABOUT COREL OFFICE PROFESSIONAL 7
This 32-bit office suite includes Corel(R) WordPerfect(R), Corel(R)
Quattro Pro and Corel(R) Presentations/TM/ for Windows 95(R), plus a
host of additional features which offer ease-of-use, OLE functionality,
open network integration and Internet connectivity. Corel's new
Barista/TM/ technology, included in all three core applications, makes
this software package the only one that enables users to publish
documents directly to the Java/TM/ Language. Corel Office Professional 7
carries a suggested list price of $695 U.S. for the CD-ROM version with
upgrades available for a suggested list price of $249 U.S.
COREL CORPORATION: REDEFINING THE SUITE MARKET
Incorporated in 1985, Corel Corporation is recognized internationally as
an award-winning developer and marketer of productivity applications,
graphics and multimedia software. Corel's product line includes
CorelDRAW*, the Corel WordPerfect Suite, Corel Office Professional,
CorelVIDEO and over 30 multimedia software titles. Corel's products run
on most operating systems, including: Windows, Macintosh, UNIX, MS-DOS
and OS/2 and are consistently rated among the strongest in the industry.
The company ships its products in over 17 languages through a network of
more than 160 distributors in 70 countries worldwide. Corel is traded on
the Toronto Stock Exchange (symbol: COS) and the NASDAQ--National Market
System (symbol: COSFF). For more information visit Corel's home page.
-----------------
BORLAND: MAKING DEVELOPMENT EASIER
Borland International Inc. (NASDAQ:BORL) is a leading provider of
products and services targeted to software developers. Borland is
distinguished for its high-quality software development tools, which
include Borland C++, Delphi, Delphi Client/Server, IntraBuilder,
InterBase, Paradox and Visual dBASE. Borland's award-winning products
are supported through comprehensive programs for small-and large-sized
software developers, corporate developers, value added resellers and
systems integrators. Founded in 1983, Borland is headquartered in Scotts
Valley, California.
Corel, Quattro and WordPerfect are registered trademarks and CorelDRAW,
CorelVIDEO, CorelCAD and Barista are trademarks of Corel Corporation or
Corel Corporation Limited. All products mentioned are trademarks or
registered trademarks of their respective companies.
2 of 2
<PAGE>
Exhibit 99.3
------------
Press Release of Borland dated October 24, 1996
<PAGE>
FOR IMMEDIATE RELEASE
BORLAND REPORTS SECOND QUARTER FISCAL 1997 RESULTS
OUTLINES STEPS AIMED AT RETURNING TO PROFITABILITY AND GROWING CLIENT/SERVER AND
INTERNET/INTRANET BUSINESS
SCOTTS VALLEY, Calif. -- October 24, 1996 -- Borland International Inc. (NASDAQ
- - BORL) today announced second quarter results for the period ended September
30, 1996 that were consistent with the range of preliminary results released on
October 16, 1996. Second quarter revenues were $36.4 million, compared with
revenues of $51.3 million for the second fiscal quarter of the prior year. The
net loss for the September 30, 1996, quarter was $9.8 million or $.31 per share,
compared with net income of $2.6 million or $.08 per share in the second quarter
a year ago. Total operating expenses for the quarter were $41.4 million compared
to $40.8 million for the same quarter of the previous year. The net loss for the
six months ended September 30, 1996, was $23.9 million or $.76 per share on
revenues of $70.9 million compared to net income of $5.5 million or $.18 per
share on revenues of $105.1 million for the prior fiscal year.
Borland attributed the second quarter revenue decline primarily to a slower than
expected transition of its sales, marketing and development efforts aimed at
serving the high-growth client/server and Internet/Intranet software development
markets for departmental and centralized corporate IT. Additionally, many
organizations were reluctant to adopt client/server products while evaluating
the impact of new Internet/intranet technologies on their information
strategies. Revenues increased for the second quarter, however, by nearly $2
million or 5.4 percent compared to the prior fiscal quarter.
As previously announced on October 16, 1996, the company is implementing a
worldwide restructuring and realignment of its corporate structure. Paul Emery,
vice president and chief financial officer, said that Borland's cost reduction
measures are targeted at producing annual savings from $15 million to $17
million. Already, the company is making progress in realigning its cost
structure as seen by a reduction in operating expenses of greater than nine
percent for the second quarter compared with the previous quarter.
"Borland is aggressively moving forward with its strategic directions to provide
client/server and Internet/intranet software development tools for Fortune 1000
companies utilizing technology for a competitive business advantage," said
Whitney Lynn, Borland's acting president and chief executive officer. "We are
taking steps directed at streamlining the company's operations with the
objective of increasing our focus on our high-growth market opportunities and
returning to profitability. We are aiming to grow the sales of existing products
while simultaneously preparing to ship new development tools for the
client/server and Internet/intranet markets later this year."
Several announcements made in the past quarter reflect Borland's progress. Some
of the announcements and developments include:
. To support the growing demand for corporate client/server, intranet and
Internet applications, Arthur Andersen announced an extended strategic
alliance with Borland to provide a worldwide, single-source, end-to-end
solution utilizing application development software from Borland.
. Borland and JavaSoft, a division of Sun Microsystems Inc., announced
that Borland's BAJA component event model for Java(TM) applications
development was being included in the draft specification for JavaSoft's
Java(TM) Beans component model.
. Borland announced the availability of Borland C++ Development Suite 5.01
and Borland C++ 5.01, updates to its critically acclaimed, award-winning
Borland C++ Development Suite 5.0 and Borland C++ 5.0 products for
software developers. The new version includes Microsoft Foundation
Classes (MFC) and a Trial Version of Delphi 2.0.
. Borland announced three new versions of its award-winning Delphi rapid
application development (RAD) tool, including a 30-day trial edition
that users can download free-of-charge from the company's World Wide
Website. The other new versions are an educational "Learn to Program
with Delphi" package for students,
<PAGE>
hobbyists and other beginning programmers, and Delphi 2.0 -- an easy-to-
use, low-price version designed to encourage software developers to
evaluate Delphi. Resellers have enthusiastically received Delphi since
the repricing and repackaging of the product's desktop versions.
. Borland shipped to resellers and corporate customers its first pure
Internet product -- Borland(R) IntraBuilder(TM). IntraBuilder and
IntraBuilder Professional, both currently shipping, are complete
toolsets for easily building and maintaining live, data-driven Intranet
applications over local web servers. IntraBuilder has received positive
reviews in the trade press and has been downloaded from the web to
approximately 60,000 sites.
. Borland announced it signed a set of strategic agreements with Netscape
Communications Corporation to cover the licensing of key technology from
the new Netscape ONE(TM) Open Network Environment for inclusion in
Borland IntraBuilder along with OEM agreements for Netscape FastTrack
Server(TM) software and Netscape Navigator(TM) Gold Premium Internet
client software. This agreement enables Borland to provide a complete
toolset for web-based intranet database solutions.
. Borland announced that its Delphi Client/Server Suite 2.0 rapid
application development tool has received the "Designed for Microsoft(R)
BackOffice(TM)" logo from Microsoft. The company announced plans to
support Microsoft's new Windows NT(R) 4.0 operating system with its
entire family of application development tools and databases, including
Delphi, Borland C++ 5.0, Paradox 7, ReportSmith, InterBase 4.0, and the
company's new intranet development tool, IntraBuilder.
Subsequent to the second quarter, Borland has continued to execute additional
partnership strategies. This week Borland announced it signed a Letter of Intent
to license AS/400 compatible connectivity and development software from
Traitement Cooperatif & Integration de Systeme (TCIS) of Paris, France. This
agreement would allow Borland to resell TCIS's software with its Delphi
Client/Server Suite to enable developers to build open, scalable client/server
applications using Delphi to access AS/400 systems.
Borland also announced this week an agreement to license Paradox to Corel. This
license agreement will enable Borland to focus on its high-growth opportunities,
while allowing Corel to oversee Paradox's on-going success.
Additional steps aimed at growing revenues and returning Borland to
profitability include:
. Shipping new products for client/server and Internet/intranet
developers--New client/server versions of Delphi and Borland C++ are
currently scheduled to be released sometime between the fourth quarter
of FY97 and the first fiscal quarter of FY98, and are designed to
provide high-performance rapid application development (RAD)
capabilities for the departmental and centralized IT marketplace. Latte,
Borland's enterprise RAD tool for Java, which is also scheduled for
release later this year, is designed to bring performance, RAD, reuse
and scalable database access to Java developers.
. Completing Open Environment Corp. (OEC) acquisition to expand Borland's
client/server product line -- Borland announced earlier this month that
it plans to close the OEC transaction on November 18 following an OEC
shareholder vote. Together, OEC and Borland will provide the industry's
only scalable architecture to meet developer needs from the desktop to
the enterprise. Borland will seek to grow its base of client/server
customers by leveraging the distribution, support and technologies of
OEC's highly scaleable client/server solutions. OEC customers include
financial services companies such as Merrill Lynch & Co. and NationsBank
Corp., and manufacturers such as Chrysler Corp. and John Deere.
"We believe in the strength of our technology and will continue to work closely
with our customers and industry partners to provide high-quality software tools
for large-scale client/server and the Internet/intranet application
development," concluded Mr. Lynn.
BORLAND: MAKING DEVELOPMENT EASIER
Borland International Inc. (NASDAQ:BORL) is a leading provider of products and
services for software developers. Borland is distinguished for its high-quality
software development tools, which include Delphi, Delphi Client/Server Suite,
IntraBuilder, Borland C++, Visual dBASE, ReportSmith and InterBase. Borland's
award-winning products are supported through comprehensive programs for small-
and large-sized software developers, corporate developers, value added resellers
and systems integrators. Founded in 1983, Borland is headquartered in Scotts
Valley, California.
Note: Statements in this release concerning Borland's profitability goals, the
anticipated impact of the Company's planned expense reductions, scheduled
product availability dates, and the Company's future prospects are forward-
looking statements that involve a number of uncertainties and risks. Factors
that could cause actual events
<PAGE>
or results to differ materially include the following: sales productivity,
possible disruptive effects of organizational or personnel changes, shifts in
customer demand, market acceptance of the Company's new or enhanced products,
customer and industry analyst perception of the Company and its technology
vision, rapid technological changes, competitive factors, unanticipated delays
in scheduled product availability dates (which could result from various
occurrences including development or testing difficulties, software errors,
shortages in appropriately skilled software engineers and project management
problems), interoperability of the Company's products with leading software
application products, general business conditions and market growth rates in the
client/server and Internet software markets, and other factors described in the
Company's S.E.C. reports on forms 10-K, 10-Q, 8-K and the Borland prospectus
relating to the acquisition of Open Environment Corporation.
###
BORLAND INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data, unaudited)
<TABLE>
<CAPTION>
Three Months,
Ended Sept. 30,
1996 1995
<S> <C> <C>
Net Revenues............................................... $ 36,407 $51,315
Cost of revenues........................................... 5,828 8,227
Gross profit............................................... 30,579 43,088
Selling, general and administrative ....................... 28,236 29,385
Research and development................................... 13,202 11,372
Total operating expenses................................... 41,438 40,757
Operating profit (loss).................................... (10,859) 2,331
Interest income, net and other............................. 1,503 974
Income (loss) before income taxes.......................... (9,356) 3,305
Income tax provision (benefit)............................. 463 661
Net income (loss).......................................... (9,819) 2,644
Net income (loss) per common and common equivalent share... $(.31) $.08
Weighted average number of common and
common equivalent shares outstanding....................... 31,329 31,656
</TABLE>
BORLAND INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data, unaudited)
<PAGE>
<TABLE>
<CAPTION>
Six Months,
Ended Sept. 30,
1996 1995
<S> <C> <C>
Net Revenues............................................... $ 70,944 $105,081
Cost of revenues........................................... 12,312 16,297
Gross profit............................................... 58,632 88,784
Selling, general and administrative........................ 61,885 62,157
Research and development................................... 24,881 21,602
Total operating expenses................................... 86,767 83,759
Operating profit (loss).................................... (28,134) 5,025
Interest income, net and other............................. 3,250 1,786
Income (loss) before income taxes.......................... (24,884) 6,811
Income tax provision (benefit)............................. (937) 1,362
Net income (loss).......................................... (23,948) 5,449
Net income (loss) per common and common equivalent share... $(.76) $.18
Weighted average number of common and
common equivalent shares outstanding....................... 31,381 30,801
</TABLE>
BORLAND INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, unaudited)
<PAGE>
<TABLE>
<CAPTION>
September 30, March 31,
1996 1996
ASSETS
<S> <C> <C>
Cash and short-term investments......................................... $ 84,226 $ 90,146
Accounts receivable, net of allowances.................................. 16,842 34,151
Inventories............................................................. 1,221 1,599
Other current assets.................................................... 7,256 7,321
Total current assets.................................................... 109,545 133,217
Property, equipment, net of accumulated depreciation and amortization... 110,088 114,612
Other non-current assets, net........................................... 7,575 7,758
Total Assets............................................................ 227,208 255,587
</TABLE>
CURRENT LIABILITIES:
<TABLE>
<S> <C> <C>
Accounts payable and accrued expenses... $34,831 $42,563
Income taxes and other.................. 28,912 26,891
Total current liabilities............... 63,743 69,454
Long-term debt and other................ 13,969 14,555
Total liabilities....................... 77,712 84,009
</TABLE>
STOCKHOLDERS' EQUITY:
<TABLE>
<S> <C> <C>
Common stock................................. 314 312
Additional paid-in-capital................... 281,368 279,083
Retained deficit............................. (135,962) (112,015)
Cumulative translation adjustment............ 3,776 4,198
Total stockholders' equity................... 149,496 171,578
Total liabilities and stockholders' equity... $ 227,208 $ 255,587
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