<PAGE> 1
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
COMMISSION FILE NUMBER: 33-64732
SPSS INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 36-2815480
(STATE OR OTHER JURISDICTION (IRS EMPLOYER IDENTIFICATION NO.)
OF INCORPORATION OR ORGANIZATION)
444 N. MICHIGAN AVENUE, CHICAGO, ILLINOIS 60611
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER INCLUDING AREA CODE: (312)329-2400
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS 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 FILING REQUIREMENTS
FOR THE PAST 90 DAYS. YES X NO
-- --
AS OF AUGUST 1, 1996, THERE WERE 7,176,185 SHARES OF COMMON STOCK
OUTSTANDING, PAR VALUE $.01, OF THE REGISTRANT.
================================================================================
<PAGE> 2
SPSS INC.
FORM 10-Q
QUARTER ENDED JUNE 30, 1996
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE
----
<S> <C> <C>
ITEM 1. FINANCIAL STATEMENTS
INDEPENDENT AUDITORS' REVIEW REPORT 3
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 1995 AND
JUNE 30, 1996 (UNAUDITED) 4
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1995
(UNAUDITED) AND 1996 (UNAUDITED) 5
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1995
(UNAUDITED) AND 1996 (UNAUDITED) 6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8
<CAPTION>
PART II - OTHER INFORMATION
<S> <C> <C>
ITEM 1. LEGAL PROCEEDINGS 13
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF
SECURITY-HOLDERS 13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 14
</TABLE>
<PAGE> 3
ITEM 1. FINANCIAL STATEMENTS
INDEPENDENT AUDITORS' REVIEW REPORT
The Board of Directors
SPSS Inc.:
We have reviewed the consolidated balance sheet of SPSS Inc. and subsidiaries
as of June 30, 1996, and the related consolidated statements of income for the
three-month and six-month periods ended June 30, 1995 and 1996 and cash flows
for the six-month periods ended June 30, 1995 and 1996. These consolidated
financial statements are the responsibility of SPSS Inc.'s management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the consolidated financial statements referred to above, for them to
be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of SPSS Inc. and subsidiaries as of
December 31, 1995, and the related consolidated statements of income,
stockholders' equity, and cash flows for the year then ended (not presented
herein); and in our report dated February 21, 1996, except as to Note 14 which
is as of March 15, 1996, we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth
in the accompanying consolidated balance sheet as of December 31, 1995, is
fairly stated, in all material respects, in relation to the consolidated
balance sheet from which it has been derived.
KPMG Peat Marwick LLP
Chicago, Illinois
August 2, 1996
3
<PAGE> 4
SPSS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT FOR SHARE DATA)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1995 1996
------------- ----------
(UNAUDITED)
<S> <C> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 10,778 $ 11,511
Accounts receivable, net of allowances 12,252 12,083
Inventories 1,590 1,387
Prepaid expenses and other current assets 1,469 1,914
--------------- --------------
Total current assets 26,089 26,895
--------------- --------------
EQUIPMENT AND LEASEHOLD IMPROVEMENTS, at cost:
Furniture, fixtures and office equipment 3,494 3,641
Computer equipment and software 8,609 9,648
Leasehold improvements 1,413 1,483
--------------- --------------
13,516 14,772
Less: Accumulated depreciation and amortization 9,179 9,795
--------------- --------------
Net equipment and leasehold improvements 4,337 4,977
--------------- --------------
Capitalized software development costs, net of
accumulated amortization 6,839 6,748
Goodwill, net of accumulated amortization 2,113 1,989
Other assets 1,999 1,889
--------------- --------------
$ 41,377 $ 42,498
=============== ==============
CURRENT LIABILITIES:
Accounts payable $ 2,331 $ 2,487
Accrued royalties 496 430
Accrued rent 921 793
Other accrued liabilities 8,785 6,735
Income taxes and value added taxes payable 2,262 2,988
Customer advances 295 195
Deferred revenues 6,485 5,348
--------------- --------------
Total current liabilities 21,575 18,976
--------------- --------------
Deferred income taxes 2,015 2,015
Other noncurrent liabilities 288 162
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value; 50,000,000 shares
authorized; 7,148,891 and 7,174,481 shares issued and 71 72
outstanding in 1995 and 1996, respectively
Additional paid-in-capital 37,126 37,416
Cumulative foreign currency translation adjustments (699) (867)
Accumulated deficit (18,999) (15,276)
--------------- --------------
Total stockholders' equity 17,499 21,345
--------------- --------------
$ 41,377 $ 42,498
=============== ==============
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 5
SPSS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT FOR SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------------- -------------------------------
1995 1996 1995 1996
------------------------------- -------------------------------
<S> <C> <C> <C> <C>
Net revenues:
Desktop products $ 10,771 $ 12,713 $ 21,118 $ 25,619
Large System products 2,550 2,612 5,110 5,467
Other products and services 1,703 1,828 3,558 3,130
------------ ------------ ----------- ------------
Net revenues 15,024 17,153 29,786 34,216
Cost of revenues 1,473 1,700 2,823 3,303
------------ ------------ ----------- ------------
Gross profit 13,551 15,453 26,963 30,913
------------ ------------ ----------- ------------
Operating expenses:
Sales and marketing 8,412 8,690 16,616 17,613
Product development 2,130 2,822 4,151 5,283
General and administrative 1,166 1,285 2,215 2,521
------------ ------------ ----------- ------------
Operating expenses 11,708 12,797 22,982 25,417
Operating income 1,843 2,656 3,981 5,496
Other income (expense):
Net interest income 15 103 11 225
Other 75 (19) 142 (69)
------------ ------------ ----------- ------------
Other income (expense) 90 84 153 156
------------ ------------ ----------- ------------
Income before income taxes 1,933 2,740 4,134 5,652
Income tax expense 663 930 1,418 1,929
------------ ------------ ----------- ------------
Net income $ 1,270 $ 1,810 $ 2,716 $ 3,723
============ ============ ============ ============
Net income per share $ 0.17 $ 0.23 $ 0.37 $ 0.48
============ ============ ============ ============
Shares used in computing net income per
share 7,685,380 7,863,790 7,422,396 7,818,397
============ ============ ============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE> 6
SPSS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
-----------------------------
1995 1996
---- -----
<C> <C> <C>
Cash flows from operating activities:
Net income $ 2,716 $ 3,723
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 2,024 2,210
Changes in assets and liabilities, net of effects of
the purchase of BMDP Statistical Software, Inc.:
Accounts receivable 770 169
Inventories 381 203
Accounts payable (1,802) 156
Accrued royalties (90) (66)
Accrued expenses (1,035) (1,933)
Other (726) (1,523)
--------- --------
Net cash provided by operating activities 2,238 2,939
--------- --------
Cash flows from investing activities:
Capital expenditures, net (1,458) (1,649)
Capitalized software development costs (1,441) (603)
Net payments for acquisitions -- (244)
--------- --------
Net cash used in investing activities (2,899) (2,496)
--------- --------
Cash flows from financing activities:
Net repayments under line-of-credit agreement (2,868) --
Net proceeds from issuance of common stock 9,206 116
Income tax benefit from stock option exercises -- 174
--------- --------
Net cash provided by financing activities 6,338 290
--------- --------
Net change in cash 5,677 733
Cash and cash equivalents at beginning of period 1,714 10,778
Cash and cash equivalents at end of period $ 7,391 $ 11,511
======== =======
Supplemental disclosures of cash flow information:
Interest paid $ 116 $ 18
Income taxes paid 1,784 727
======== =======
</TABLE>
See accompanying notes to consolidated financial statements.
6
<PAGE> 7
SPSS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
THE ACCOMPANYING UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
REFLECT ALL ADJUSTMENTS WHICH, IN THE OPINION OF MANAGEMENT, ARE NECESSARY FOR
A FAIR PRESENTATION OF THE RESULTS OF THE INTERIM PERIODS PRESENTED. ALL SUCH
ADJUSTMENTS ARE OF A NORMAL RECURRING NATURE.
THESE CONSOLIDATED FINANCIAL STATEMENTS SHOULD BE READ IN CONJUNCTION WITH
THE COMPANY'S AUDITED CONSOLIDATED FINANCIAL STATEMENTS AND NOTES THERETO FOR
THE YEAR ENDED DECEMBER 31, 1995, INCLUDED IN THE COMPANY'S FORM 10-K FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION.
NOTE 2 - NET INCOME PER SHARE
NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE HAS BEEN COMPUTED USING
THE WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE COMMON EQUIVALENT SHARES
OUTSTANDING FOR EACH PERIOD (7,863,790 SHARES FOR THE THREE MONTHS ENDED JUNE
30, 1996, 7,818,397 SHARES FOR THE SIX MONTHS ENDED JUNE 30, 1996, AND
7,685,380 AND 7,422,396 SHARES FOR THE COMPARABLE PERIODS IN 1995). COMMON
EQUIVALENT SHARES CONSIST OF THE SHARES ISSUABLE UPON EXERCISE OF STOCK OPTIONS
(USING THE TREASURY STOCK METHOD).
7
<PAGE> 8
ITEM 2. MANGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS
OF OPERATIONS.
The following table sets forth the percentages that selected items in the
Consolidated Statements of Income bear to net revenues.
<TABLE>
PERCENTAGE OF NET REVENUES PERCENTAGE OF NET REVENUES
-------------------------- --------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------- -------------------
1995 1996 1995 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Statement of Income Data:
Net revenues:
Desktop products 72% 74% 71% 75%
Large System products 17% 15% 17% 16%
Other products and services 11% 11% 12% 9%
---- ---- ---- ----
Net revenues 100% 100% 100% 100%
Cost of revenues 10% 10% 10% 10%
---- ---- ---- ----
Gross profit 90% 90% 90% 90%
---- ---- ---- ----
Operating expenses:
Sales and marketing 56% 51% 56% 52%
Product development 14% 16% 14% 15%
General and administrative 8% 8% 7% 7%
---- ---- ---- ----
Operating expenses 78% 75% 77% 74%
Operating income 12% 15% 13% 16%
Other income (expense):
Net interest income -- 1% -- 1%
Other 1% -- 1% --
---- ---- ---- ----
Other income (expense) 1% 1% 1% 1%
---- ---- ---- ----
Income before income taxes 13% 16% 14% 17%
Income tax expense 4% 5% 5% 6%
---- ---- ---- ----
Net income 9% 11% 9% 11%
==== ==== ==== ====
</TABLE>
8
<PAGE> 9
COMPARISON OF THREE MONTHS ENDED JUNE 30, 1995 TO THREE MONTHS ENDED JUNE 30,
1996.
Net Revenues. Net revenues were $15,024,000 and $17,153,000 for the three
months ended June 30, 1995 and 1996, respectively, an increase of 14%. This
revenue increase was influenced, in part by the acquisition of BMDP Statistical
Software, Inc. ("BMDP"), effective December 29, 1995. Net of BMDP revenue of
approximately $226,000, the Company's increase in sales was 13%. Revenues
from products designed for desktop computers ("Desktop products") increased by
18% over the corresponding period in 1995, and there was a 2% increase in
revenues from products designed for mainframes, minicomputers, and UNIX
workstations ("Large System products"). The increase in revenues from Desktop
products reflected a $1,414,000 increase in new revenues from SPSS for Windows.
In addition, revenues from annual license renewals of Desktop products
resulted in a net increase of $894,000, reflecting a $1,006,000 increase in
annual license renewals of SPSS for Windows. The increase in revenues from
Large System products was primarily due to an increase in revenues from new
UNIX licenses as a result of the BMDP acquisition. Other products and services
revenues increased by 7% due primarily to an increase of $282,000 in revenues
from training and consulting services. Revenue for the second quarter of 1996
were adversely affected by changes in foreign currency exchange rates.
Cost of Revenues. Cost of revenues consists of costs of goods sold,
amortization of capitalized software development costs, and royalties paid to
third parties. Cost of revenues was $1,473,000 and $1,700,000 in the three
months ended June 30, 1995 and 1996, respectively. Such costs increased due to
higher sales levels and higher amortization amounts of capitalized software and
product translations. As a percentage of net revenues, cost of revenues
remained constant at 10%.
Sales and Marketing. Sales and marketing expenses were $8,412,000 and
$8,690,000 in the three months ended June 30, 1995 and 1996, respectively, an
increase of 3%. This increase was due to the expansion of the domestic and
international sales organizations, and salary and commission increases. As a
percentage of net revenues, such expenses decreased from 56% to 51%.
Product Development. Product development expenses were $2,130,000 and
$2,822,000 (net of capitalized software development costs of $309,000 and
$176,000) in the three months ended June 30, 1995 and 1996, respectively, an
increase of 32%. In the corresponding periods in 1995 and 1996, the Company's
expense for amortization of capitalized software and product translations,
included in cost of revenues, was $346,000 and $356,000, respectively. The
increase in product development expenses was primarily due to lower
capitalization of developed software, salary and recruiting fee increases, and
other additions to the product development staff. As a percentage of net
revenues, product development expenses increased from 14% to 16%.
9
<PAGE> 10
General and Administrative. General and administrative expenses were
$1,166,000 and $1,285,000 in the three months ended June 30, 1995 and 1996,
respectively, an increase of 10%. Such expenses increased primarily due to
increases in bad debt and temporary employment expenses. As a percentage of
net revenues, general and administrative expenses remained constant at 8%.
Net Interest Income. Net interest income was $15,000 and $103,000 for the
three months ended June 30, 1995 and 1996, respectively. This variance was
primarily due to SPSS' investment of higher cash balances in 1996, the
elimination of interest expense related to the final settlement of the stock
appraisal action in 1995, and adjustment for prior year vendor interest charges
in 1995.
Other Income (Expense). Other income (expense) consists of foreign currency
transaction gains and losses. Such foreign currency transactions resulted in a
gain of $75,000 for the three months ended June 30, 1995 and an expense of
$19,000 for the three months ended June 30, 1996.
Provision for Income Taxes. Provision for income taxes was $663,000 and
$930,000, for the three months ended June 30, 1995 and 1996, respectively,
reflecting an approximate effective tax rate of 34%.
COMPARISON OF SIX MONTHS ENDED JUNE 30, 1995 TO SIX MONTHS ENDED JUNE 30, 1996.
Net Revenues. Net revenues were $29,786,000 and $34,216,000 in the six months
ended June 30, 1995 and 1996, respectively, an increase of 15%. This increase
in revenue was influenced, in part, by the acquisition of BMDP, effective
December 29, 1995. Net of BMDP revenue of approximately $496,000, the
Company's increase in sales was 13%. Revenues from Desktop products increased
21% over the corresponding period in 1995 and revenues from Large System
products increased 7%. The increase in revenues from Desktop products
reflected $2,925,000 in new revenues from SPSS for Windows. In addition,
revenues from annual license renewals of Desktop products resulted in a net
increase of $1,738,000, reflecting a $2,046,000 increase in annual license
renewals of SPSS for Windows. The increase in revenues from Large System
products was primarily due to an increase in revenues from new UNIX licenses as
a result of the BMDP acquisition. Other products and services revenues
decreased 12% primarily due to the decrease in revenues previously received
from publications and student products due to the end of the payment of
guaranteed royalty payments for the Prentice Hall Agreement in July 1995.
Revenues for the first six months of 1996 were adversely affected by changes in
foreign currency exchange rates.
Cost of Revenues. Cost of revenues were $2,823,000 and $3,303,000 for the six
months ended June 30, 1995 and 1996, respectively. Such costs increased due to
higher sales levels and higher amortization amounts of capitalized software and
product translations. As a percentage of net revenues, such expenses remained
constant at 10%.
10
<PAGE> 11
Sales and Marketing. Sales and marketing expenses were $16,616,000 and
$17,613,000 in the six months ended June 30, 1995 and 1996, respectively, an
increase of 6%. This increase was due to expansion of the domestic and
international sales organizations, and salary and commission increases. As a
percentage of net revenues, such expenses decreased from 56% to 52%.
Product Development. Product development expenses were $4,151,000 and
$5,283,000 (net of capitalized software development costs of $942,000 and
$459,000) for the six months ended June 30, 1995 and 1996, respectively, an
increase of 27%. In the corresponding periods in 1995 and 1996, the Company's
expense for amortization of capitalized software and product translations,
included in cost of revenues, was $718,000 and $694,000, respectively. The
increase in product development expenses was primarily due to lower
capitalization of developed software, salary and recruiting fee increases and
other additions to the product development staff. As a percentage of net
revenues, such expenses increased from 14% to 15%.
General and Administrative. General and administrative expenses were $2,215,000
and $2,521,000 in the six months ended June 30, 1995 and 1996, respectively.
Such expenses increased primarily due to increases in bad debt expense and
temporary employment expenses. As a percentage of net revenues, general and
administrative expenses remained constant at 7%.
Net Interest Income. Net interest income was $11,000 and $225,000 for the six
months ended June 30, 1995 and 1996, respectively. This favorable variance can
be attributed to the elimination of interest expense related to the line of
credit, which was repaid with the net proceeds from the Company's follow-on
public offering of common stock, in February 1995.
Other Income (Expense). Other income (expense) was $142,000 and $(69,000) for
the six months ended June 30, 1995 and 1996, respectively. These balances
reflect foreign currency gains of $247,000 and a $105,000 charge related to the
final settlement of the stock appraisal action in 1995; and in 1996, foreign
currency losses of $69,000.
Provision for Income Taxes. Provision for income taxes was $1,418,000 and
$1,929,000 in the six months ended June 30, 1995 and 1996, respectively,
reflecting an approximate effective tax rate of 34%.
LIQUIDITY AND CAPITAL RESOURCES
The Company had no long-term debt as of June 30, 1996 and held approximately
$11,511,000 of cash and cash equivalents. Funds in the first six months of
1996 were used in operations and for payments related to the Company's
acquisition of BMDP. Capital expenditures were also made for furniture,
computer equipment and leasehold improvements for newly hired employees and
product development.
11
<PAGE> 12
The Company currently has an available $5,000,000 secured line of credit with
Bank of America N.T.S.A. ("B of A"), under which borrowings bear interest at
the reference rate (currently 8.25%). As of June 30, 1996, the Company had no
borrowings under this line of credit. The credit agreement with B of A
requires the Company to comply with certain specified financial ratios and
tests, and restricts the Company's ability to, among other things (i) pay
dividends or make distributions, (ii) incur additional indebtedness, (iii)
create liens on assets, (iv) make investments, (v) engage in mergers,
acquisitions or consolidations, (vi) sell assets and (vii) engage in certain
transactions with affiliates.
The Company anticipates that amounts available under its line of credit,
existing sources of liquidity, cash flows generated from operations, and the
net proceeds from the February 1995 public offering of common stock will be
sufficient to fund the Company's operations and capital requirements for the
foreseeable future. However, no assurance can be given that changing business
circumstances will not require additional capital for reasons that are not
currently anticipated or that the necessary additional capital will then be
available to the Company on favorable terms, or at all.
INTERNATIONAL OPERATIONS
Significant growth in the Company's international operations continued during
the second quarter of 1996. The portion of revenues attributable to
international operations was adversely affected by the relationship of the U.S.
dollar when compared to other foreign currencies. Net corporate revenues
increased 14% in the three months ended June 30, 1996, when compared to the
three months ended June 30, 1995 and 15% for the six months ended June 30, 1996
when compared to the same period of 1995. Net of the effects of changes in
foreign currency rates, the increase would have been approximately 20% and 21%,
respectively.
12
<PAGE> 13
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Currently there are no material pending legal proceedings to which the Company
or any of its subsidiaries is a party or to which any of their property is
subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
The Company's Annual Meeting of Stockholders was held on June 19, 1996. The
following persons were nominated and elected to serve as Directors of the
Company for a term of three years or until their successors have been duly
elected and qualified:
<TABLE>
<CAPTION>
Nominee For Withheld
----------------- --------- -----------
<S> <C> <C>
Norman Nie 5,971,200 139,761
Bernard Goldstein 5,971,212 139,749
</TABLE>
In addition, the Company's appointment of KPMG Peat Marwick LLP to serve as its
independent auditor for fiscal year 1996 was ratified in accordance with the
following vote:
<TABLE>
<CAPTION>
For Against Abstain
--------- ------- -------
<S> <C> <C>
6,094,886 12,600 3,475
</TABLE>
The Amended and Restated 1995 Equity Incentive Plan was presented and adopted
in accordance with the following vote:
<TABLE>
<CAPTION>
For Against Abstain Broker Non-Votes
--------- --------- --------- ------------------
<S> <C> <C> <C>
4,133,264 879,083 13,101 1,085,513
</TABLE>
13
<PAGE> 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits (Note: Management contracts and compensatory plans
or arrangements are underlined in the following list.)
<TABLE>
<CAPTION>
Incorporation
Exhibit by Reference
Number Description of Document (if applicable)
------ -------------------------------------------- ---------------
<S> <C> <C>
3.1 Certificate of Incorporation of the Company * 3.2
3.2 By-Laws of the Company * 3.4
4.1 Credit Agreement ** 4.1
10.1 Amended and Restated 1995
--------------------------
Equity Incentive Plan xx
----------------------
15.1 Acknowledgment of Independent Certified
Public Accountants Regarding Independent
Auditors' Review Report
27.1 Financial Data Schedule
</TABLE>
_______________________________
* Previously filed with Amendment No. 2 to Form S-1 Registration Statement
of SPSS Inc. filed on August 4, 1993 (Registration No. 33-64732)
** Previously filed with SPSS' Quarterly Report on Form 10-Q for the
Quarterly Period Ended March 31, 1996
xx Previously filed as Appendix A to the Company's 1996 Proxy Statement,
filed on May 16, 1996
(b) Reports on Form 8-K
There were no reports on Form 8-K filed by the Company during the
fiscal quarter ended June 30, 1996
14
<PAGE> 15
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.
SPSS INC.
DATE: AUGUST 12, 1996 BY: /S/ JACK NOONAN
-------------------------------------
JACK NOONAN
PRESIDENT AND CHIEF EXECUTIVE OFFICER
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BY THE UNDERSIGNED, IN HIS CAPACITY AS THE PRINCIPAL
FINANCIAL OFFICER OF THE REGISTRANT.
DATE: AUGUST 12, 1996 BY: /S/ EDWARD HAMBURG
--------------------------------------
EDWARD HAMBURG
SENIOR VICE-PRESIDENT, CORPORATE
OPERATIONS AND CHIEF FINANCIAL OFFICER
15
<PAGE> 16
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Page
Number Description of Document Number
------- ----------------------- ------
<S> <C> <C>
15.1 Acknowledgment of Independent Certified 17
Public Accountants Regarding Independent
Auditors' Review Report
27.1 Financial Data Schedule 18
</TABLE>
16
<PAGE> 1
EXHIBIT 15. 1
-------------
ACKNOWLEDGMENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
REGARDING INDEPENDENT AUDITORS' REVIEW REPORT
The Board of Directors
SPSS Inc.:
With respect to the Registration Statements on Form S-8 of SPSS Inc., we
acknowledge our awareness of the use therein of our report dated August 2, 1996
related to our review of interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such report is not
considered part of a registration statement prepared or certified by an account
or a report prepared or certified by an accountant within the meaning of
sections 7 and 11 of the Act.
KPMG Peat Marwick LLP
Chicago, Illinois
August 12, 1996
17
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM SPSS INC.
AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET AT JUNE 30, 1996 AND CONSOLIDATED
STATEMENT OF INCOME FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1996
<PERIOD-START> APR-01-1996 JAN-01-1996
<PERIOD-END> JUN-30-1996 JUN-30-1996
<CASH> 11,511 0
<SECURITIES> 0 0
<RECEIVABLES> 12,691 0
<ALLOWANCES> 608 0
<INVENTORY> 1,387 0
<CURRENT-ASSETS> 26,895 0
<PP&E> 14,772 0
<DEPRECIATION> 9,795 0
<TOTAL-ASSETS> 42,498 0
<CURRENT-LIABILITIES> 18,976 0
<BONDS> 0 0
<COMMON> 72 0
0 0
0 0
<OTHER-SE> 21,273 0
<TOTAL-LIABILITY-AND-EQUITY> 42,498 0
<SALES> 17,153 34,216
<TOTAL-REVENUES> 17,153 34,216
<CGS> 1,700 3,303
<TOTAL-COSTS> 1,700 3,303
<OTHER-EXPENSES> 12,797 25,417
<LOSS-PROVISION> 227 300
<INTEREST-EXPENSE> 5 11
<INCOME-PRETAX> 2,740 5,652
<INCOME-TAX> 930 1,929
<INCOME-CONTINUING> 1,810 3,723
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 1,810 3,723
<EPS-PRIMARY> 0.23 0.48
<EPS-DILUTED> 0.23 0.48
</TABLE>
