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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of report (Date of earliest event reported): April 19, 1999
BARRA, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-19690 94-2993326
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
2100 MILVIA STREET, BERKELEY, CA 94704-1113
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (510) 548-5442
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
Filed herewith as Exhibit 99.1 is a copy of the Registrant's press
release, issued March 1, 1999, relating to certain management decisions.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
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Exhibit No. Description
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99.1 Press Release of BARRA, Inc. dated April 22, 1999
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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 hereunto duly authorized.
BARRA, INC.
Date: April 22, 1999 By: /s/ James D. Kirsner
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Name: James D. Kirsner
Title: Chief Financial Officer
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EXHIBIT INDEX
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Exhibit No. Description
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<S> <C>
99.1 Press Release of BARRA, Inc. dated April 22, 1999
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FOR IMMEDIATE RELEASE
CONTACT:
James Kirsner Jennifer Hinchman
Chief Financial Officer Manager, Corporate Communications
510.548.5442 510.649.4548
BARRA REFOCUSES PRODUCT STRATEGY
BERKELEY, Calif., April 19, 1999--BARRA, Inc. (NASDAQ: BARZ) today announced
plans to discontinue the development and support of certain single country
fixed income products. Based on the results of a strategic review of market
trends and current product offerings, BARRA will now focus on its global and
firm-wide risk platforms for future fixed income development.
"This change in focus will allow us to concentrate on higher growth and
higher margin analytics products that deliver greater value and obtain larger
revenues per client," said Andrew Rudd, chairman and chief executive officer.
BARRA will refocus its fixed income software development strategy from three
separate, but parallel product agendas, namely, its global products, the
fixed income portion of the enterprise risk management products and the
single country products, to two integrated product offerings that will
provide broad fixed income asset coverage. BARRA plans to include single
country functionality as a part of the global and firm-wide risk products.
"This is all about focus and rationalization of our fixed income product
agenda so that we are concentrating our efforts on areas where we have the
greatest competitive advantage. Over the last few years there has been a
major evolution in our market that has resulted in increased client
concentration, and the integration of asset management with the firm-wide
risk and oversight functions. This has lead to two important changes in asset
portfolios--there has been a dramatic broadening of the asset mix, and the
distinction between domestic and international has become increasingly
blurred," said Dr. Rudd. "Our mission must be to continue to deliver tools
that efficiently analyze globally diversified, cross asset portfolios on a
single platform providing consistent analyses that can be distributed
firm-wide," he added.
In connection with this decision, the company will provide support for
certain single country products for the next six to nine months, depending on
the product, and will then discontinue the product offerings. It
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is anticipated that some clients will migrate to BARRA's global or firm-wide
risk platforms for fixed income analytics. Over the longer term, it is
anticipated that increased U.S. asset coverage will be added to the global
product to replace the coverage and functionality of the products being
discontinued.
Revenues from the products that will be discontinued for the fiscal year ended
March 31, 1999, were approximately $8 million, or approximately 5 percent of
BARRA's revenues. BARRA does not anticipate any significant revenue from
these products in the fiscal year beginning April 1, 1999. In the quarter
ended March 31, 1999, the company will have an associated charge of
approximately $4.0 million for the write-off of capitalized software and
goodwill from the 1997 acquisition of a fixed income business. This will be
followed by an associated restructuring charge for the costs associated with
staff reductions and other costs directly related to the decision to
discontinue the products in the quarter ended June 30, 1999. The estimated
amount of the restructuring charges will be determined as soon as the details
of the plan are finalized. Current accounting rules prohibit the recording
of both charges in the same quarter even though they derive from the same
event. It is anticipated that initially, excluding the write-off and
restructuring charges, the reductions in costs will not completely offset the
reductions in revenues associated with the discontinued products. The
long-term financial impact of focusing on the high end of the market and
rationalizing efforts in fixed income is, however, expected to be positive.
The focus on the global and firm-wide risk products will build on commitment
and success in these two important markets. BARRA was the first provider of
global fixed income analytics introducing its first global product in 1991,
and its product, The BARRA Cosmos System, remains the global market leader,
with clients in more than 20 countries. Cosmos includes coverage of fixed
income instruments in 22 countries and 51 currencies, and offers a complete
set of solutions designed to meet the needs of global fixed income investment
professionals. This breadth of offerings remains unmatched by any other
provider.
BARRA made a significant investment in firm-wide risk software with the asset
acquisition of Redpoint Software, Inc. in 1998. In conjunction with its
strength in analytics and risk measurement, BARRA has delivered integrated,
firm-wide asset and risk management applications to large asset managers and
pension sponsors in the U.S. and Europe. The further integration of
sophisticated single country fixed income modeling will enhance BARRA's Total
Risk offering and increase its applicability to large fixed income managers
in the U.S.
BARRA, founded in 1975, provides innovative analytical models, software,
consulting, investment data and money management services that enable its
clients worldwide to make superior investment and trading decisions. Based
in Berkeley, California, BARRA also has offices in major financial centers
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throughout the world. Information on BARRA is also available on-line at
http://www.barra.com.
Each statement in this news release containing any form of the words "will,"
"plan," "anticipate," "estimate" or "expect," or any future verb tense, is a
forward-looking statement that may involve a number of risk factors and
uncertainties. Among other factors that could cause actual results to differ
materially are the following: significant delays or excessive costs
associated with the incorporation of single-country product features and
asset coverages into BARRA's global fixed-income and/or firm-wide risk
management products; failure to retain the personnel necessary to implement
the transitions described above; claims against BARRA associated with the
discontinuation of products and/or related data or services; unavailability
of adequate third-party data on reasonable terms and at reasonable prices;
failure of clients to migrate to BARRA's global or firm-wide risk platforms;
inability to significantly increase sales of or margins in global fixed
income or firm-wide risk platforms; inability to achieve cost reductions
associated with discontinuing products; and significant delays, excessive
costs, or diversion of management and product development resources
associated with the remediation of BARRA's software products and internal
processes to accommodate dates after December 31, 1999. Further information
on potential factors that could affect the Company's financial results is
included in the Company's Form 10-K for the 1998 fiscal year and the
Company's December 30, 1998 Form 10-Q filed with the Securities and Exchange
Commission (SEC). Please refer to the Company's SEC filings, copies of which
are available from the Company without charge or online at http://www.barra.com
for further information.
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