<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 16, 1999
MERANT plc
(Translation of Registrant's Name Into English)
The Lawn, Old Bath Road, Newbury, England RG14 1QN
(Address of Principal Executive Offices)
(Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F _____
-------
(Indicate by check mark whether the registrant by furnishing the
information contained in this form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes X No _____
-------
(If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2 (b): 82-795.)
<PAGE> 2
LONDON STOCK EXCHANGE ANNOUNCEMENT
FOR IMMEDIATE RELEASE
CONTACTS:
MERANT VMW Corporate & Investor Relations
Ken Sexton Sylvia Dresner/Vicki Weiner
Chief Financial Officer United States
301 838 5228 212 616 6161
[email protected] [email protected]
Larry De'Ath Financial Dynamics
MERANT Giles Sanderson/Edward Bridges
VP, Investor Relations United Kingdom
301 838 5228 44 (0) 171 831 3113
[email protected] [email protected]
MERANT's Second Quarter Net Income Rises Fourfold
Launch of MERANT Egility Sets the Stage for E-Business Growth
www.merant.com - November 16, 1999 - MERANT (Nasdaq National Market (NNM): MRNT;
London Stock Exchange (LSE): MRN), a global leader in enterprise application
development and e-business solutions, today reported a fourfold rise in net
income for the second fiscal quarter ended October 31, 1999.
For the second fiscal quarter, revenues rose to $92.2 million from $87.2 million
in the prior year's second quarter under U.S. generally accepted accounting
principles (or "GAAP"). The Company reported revenues of $87.6 million in the
first quarter of the current fiscal year. Net earnings advanced to $4.3 million
from $1.1 million in last year's second quarter, and are up from $0.9 million in
the first fiscal quarter. Pre-tax operating earnings before goodwill
amortization for the quarter ended October 31, 1999 were $7.7 million as
compared to $0.9 million in last year's second quarter. Diluted earnings per
American Depositary Share (ADS) were $0.14 as compared to $0.04 per ADS in the
comparable prior year period and $0.03 per ADS in the first quarter of fiscal
2000.
Under U.K. GAAP, revenues were GBP 57.0 million for the quarter ended October
31, 1999 as compared to GBP 40.1 million for the same period last year. Revenues
for this year's first fiscal quarter ended July 31, 1999 were GBP 54.9 million.
Operating profit before goodwill amortization advanced to GBP 4.7 million as
compared to GBP 3.9 million in the second quarter of fiscal 1999, and up from
GBP 0.8 million from this year's first fiscal quarter. Earnings per ordinary
share before amortization of goodwill was 2.5 pence per share as compared with
3.1 pence per share in last year's second quarter.
"During the second quarter, we made substantial strides in strengthening
MERANT's position in enterprise-based e-business solutions," said MERANT
president and CEO Gary Greenfield. "A critical element of our e-business
strategy was implemented with the launch of MERANT Egility(tm), a new framework
that provides rapid delivery of e-enabling technology and expertise, a priority
for development teams worldwide. With Egility, we are leveraging our e-business
core strengths that currently exist throughout MERANT in creating the new,
transforming the existing, integrating the enterprise and managing the
application environment. We are encouraged by the increase in e-related revenues
in the second quarter and continuing demand for our application development
management and data connectivity solutions."
"Most recently, we announced our intention to acquire EnterpriseLink Technology
Corporation, an innovative supplier of enterprise extension software. This
acquisition will help our customers' further extend applications for e-business
and leverage their substantial investments in existing software assets. We
expect continued growth in the e-business sector of our business during the
second half of this fiscal year," Greenfield indicated.
Commenting on the Company's financial performance, Ken Sexton, MERANT's chief
financial officer, noted, "Our revenue results reflect the transition to
increasing e-business sales, as related new products and services enter the mix.
With year 2000 (Y2K) revenues excluded, we have actually seen a license fee
revenue increase of 24% and overall revenues increasing 16%. As anticipated,
operating margins improved as we began to realize the full cost savings from our
merger consolidation program."
<PAGE> 3
MERANT's most recent and second quarter highlights include:
* MERANT Launches Egility for E-Enabling the Enterprise - MERANT Egility is a
new framework that delivers technology and expertise to quickly address the
application issues surrounding e-enablement. This framework delivers
Egility solutions for creating e-business strategy, building e-commerce
sites, extending legacy applications, accessing and integrating data and
applications, managing web content, developing web applications, and more.
* MERANT Enters into Agreement to Acquire EnterpriseLink - MERANT announced
it has entered into a definitive agreement to acquire privately-held
EnterpriseLink Technology Corporation, an innovative supplier of enterprise
extension software. The acquisition will enhance MERANT's ability, through
the MERANT Egility framework, to integrate and extend existing applications
to quickly e-enable the enterprise.
* MERANT Introduces Egility Web Content Management Solution - The mixing of
creative content with mission critical applications greatly increases the
number of changes that must be managed, as well as the risks of making
mistakes. MERANT Egility Web Content Management delivers the infrastructure
and process expertise for managing Web content and applications and all of
the changes that enable the enterprise to compete in an e-business world.
* MERANT Egility Speeds Data Integration for E-Business - The new MERANT
Egility Data Integration solution helps optimize the use of an
organization's data across the enterprise value chain, enabling e-business
capabilities such as information integration, secure business transactions,
direct mainframe connectivity and application server support.
* Siebel Selects MERANT DataDirect for Enterprise Data Access and Integration
- Siebel Systems the leading supplier of Web-based front office software
systems, selected DataDirect Connect (tm) ODBC drivers for market-leading
data access. With this license agreement, Siebel Systems will include
MERANT's DataDirect Connect ODBC drivers as a component of its front office
applications and development environments.
* Java Developer's Journal Awards MERANT PVCS Readers' Choice Award - The
PVCS (r) Series received top honors among development teams by winning the
coveted Java Developer's Journal Readers' Choice Award for "Best Team
Development Tool." The PVCS Series' appeal to developers is founded on its
developer tailored interfaces and its ability to offer a market leading
software configuration management (SCM) solution that is based on the Java
platform.
* DoubleClick Selects MERANT PVCS to Manage Core Applications - DoubleClick
has purchased an enterprise-wide license for PVCS to manage source code and
projects throughout the organization. The industry's leading global
Internet advertising solutions company, DoubleClick has signed a three-year
license agreement to use PVCS software configuration management solutions.
* SoftBank Technology Corporation Adopts MERANT PVCS Version Manager for Web
Development - SoftBank Technology Corporation, a system integrator
specializing in electronic commerce, has adopted PVCS, the industry-leading
solution for organizing, managing and protecting enterprise software
assets.
About MERANT
Founded in 1976, MERANT is a leader in Enterprise Application Development,
providing the products, people and processes to accelerate the customer's
business through the application of innovative information technology. MERANT's
Egility empowers organizations to transform their enterprise applications for
the changing technology and business requirements of the e-business environment,
manage the application development process, and provide integrated data
connectivity across the enterprise, from the mainframe to the Internet. A global
organization with $370 million in annual revenues and 2,000 employees, MERANT
has approximately 500 technology partners and more than 5 million licenses at
over 35,000 customer sites - including the entire Fortune 100 and the majority
of the Global 500. For additional information on MERANT and its solutions, visit
the MERANT web site at http://www.merant.com. Investor inquiries can be
forwarded to [email protected].
<PAGE> 4
Forward-Looking Statements
The following statement is made in accordance with the U.S. Private Securities
Litigation Reform Act of 1995: This announcement contains forward-looking
statements that include statements regarding expectations for revenue and profit
growth, future demand for MERANT's Egility, e-commerce, enterprise extension,
application development management and data connectivity solutions, growth in
MERANT's e-commerce business, features and benefits of MERANT's products and
services, and expectations for MERANT's enterprise extension software business,
including the completion of the acquisition and integration of EnterpriseLink
Technology Corporation. These forward-looking statements involve a number of
risks and uncertainties. Actual results could differ materially from those
anticipated by the forward-looking statements made herein. Factors that could
cause actual results to differ materially include, among others, the ability of
MERANT to effectively manage its costs against uncertain revenue expectations,
the ability to manage and integrate recently acquired businesses or other
businesses that it may acquire in the future, the potential for a decrease in
net revenue which may be caused by delays in the timing of the delivery of
products or services, the ability of MERANT to develop, release and sell
products and services to customers in the highly dynamic market for enterprise
application development, data access and e-commerce solutions, the potential
need for enterprise application development solutions to shift based on changes
in underlying technology standards coming into use, the market acceptance of
e-commerce solutions generally, and the effect of competitors' efforts to enter
MERANT's markets. Further information on potential factors which could affect
MERANT's financial results is included in MERANT's Annual Report on Form 20-F
for the year ended April 30, 1999, as submitted to the SEC and as it may be
updated and amended with future filings or submissions. MERANT undertakes no
obligation to release publicly any updates or revisions to any forward-looking
statements contained in this announcement that may reflect events or
circumstances occurring after the date of this announcement.
Trademark Notice
MERANT, Egility and DataDirect Connect are trademarks, and DataDirect, and PVCS
are registered trademarks, of MERANT. All other trademarks as they appear in
this announcement are the property of their respective owners.
Securities Exchanges
As a foreign private issuer in the United States, MERANT is not required to file
quarterly reports with the U.S. Securities and Exchange Commission ("SEC").
However, beginning in 1997, MERANT commenced furnishing to the SEC on a
voluntary basis quarterly reports on Form 6-K which include MERANT's results for
the applicable quarter in a format similar to that of a Form 10-Q. These
materials are available on the SEC web site located at http://www.sec.gov.
Copies of MERANT's Annual Report to Shareholders and Annual Report on Form 20-F,
each for the year ended April 30, 1999, are available upon request to MERANT's
offices in Rockville, Maryland or Newbury, United Kingdom.
(Tables and Supplemental Analysis Follow)
<PAGE> 5
U.S. GAAP results
In the U.S. formatted financial statements, which are prepared in accordance
with U.S. generally accepted accounting principles, or GAAP (with the exception
of footnotes), the merger with INTERSOLV completed in September of 1998 was
accounted for as a pooling-of-interests. Accordingly, all U.S. financial data
presented in this report include the results of INTERSOLV.
Review of 2nd Quarter - Revenues for the second fiscal quarter ended October 31
1999, were $92.2 million, an increase of 6% over last year's comparable quarter.
Revenue increased in all almost major solution areas except for the Year 2000
(or "Y2K") area. Non-Y2K revenue increased 16% compared to last year's same
quarter. Revenues from Y2K represented 8% of total revenue for the quarter, down
from 17% a year ago.
Gross margins improved to $69.2 million, or 75% of revenue. Improved margins in
MERANT's consulting business combined with higher license fee revenue were the
primary reason for increased margins. Operating costs increased slower than
revenue, as additional investments in sales and marketing programs were offset
somewhat by savings in other areas. Operating income, before goodwill
amortization charges, was $7.7 million compared with $0.9 million in the second
quarter last year. Last year's second quarter, included one-time charges of
$49.7 million related to the merger with INTERSOLV. Net income per ADS was $0.14
compared with $0.04 for the corresponding period last year. Net earnings per ADS
excluding goodwill amortization in the second quarter of fiscal 2000 were $0.20
as compared to $0.06 for the prior year's comparable period.
In August of 1999, MERANT completed the acquisition of the e-business consulting
company, the Marathon Group, for approximately $15 million in cash. The
acquisition was accounted for using the purchase method.
Review of 1st Half - Year-to-date revenues were $179.8 million, down 1% compared
to the six months ended October 31 1998. Non-Y2K revenue increased 7% in the
first half of this fiscal year. Revenue from Y2K products and services
represented 9% of total revenue, down from 17% for the first half of last year.
Gross margins for the half year were $133.6 million, or 74% of revenue, compared
to $130.3 million, or 71% of revenue, for the corresponding period last year.
Operating income, before goodwill amortization charges, was $9 million compared
with $11.3 million for the first half of last year. Net income was $5.1 million,
compared to $8.4 million. Net income per diluted ADS was $0.17 compared with
$0.28 per ADS for the corresponding period last year. Net income excluding
goodwill amortization per ADS was $0.36 in this year's first six months, as
compared to $0.50 per ADS for last year's first six months.
Summary financial results excluding non-recurring items are as follows:
<TABLE>
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------
U.S. dollars, U.S. GAAP
(in millions, except per ADS amounts) Three Three Six Six
months months months months
ended ended ended ended
Oct 31, Oct 31, Oct 31, Oct 31,
1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------
Revenue $92.2m $87.2m $179.8m $182.4m
- ----------------------------------------------------------------------------------------------------------------
EBITA $ 7.7m $ 0.9m $ 9.0m $ 11.3m
- ----------------------------------------------------------------------------------------------------------------
Earnings per ADS - excluding goodwill $ 0.20 $ 0.06 $ 0.36 $ 0.50
- ----------------------------------------------------------------------------------------------------------------
Net income $ 4.3m $ 1.1m $ 5.1m $ 8.4m
- ----------------------------------------------------------------------------------------------------------------
Earnings per ADS - diluted $ 0.14 $ 0.04 $ 0.17 $ 0.28
- ----------------------------------------------------------------------------------------------------------------
Notes:
* Basis of presentation: in accordance with U.S. GAAP, the INTERSOLV merger
has been accounted for as a pooling-of-interests, and accordingly all
periods presented in U.S. format disclose the combined results of MERANT
and INTERSOLV.
* EBITA is earnings before interest, taxes, goodwill amortization charges,
and non-recurring items.
</TABLE>
<PAGE> 6
U.K. GAAP results
In the U.K. formatted financial statements, which are prepared in accordance
with U.K. GAAP (with the exception of footnotes), the purchase of INTERSOLV was
accounted for as an acquisition. Accordingly, the U.K. format results
incorporate the trading of INTERSOLV only from September 24, 1998, the date of
its acquisition. Goodwill arising from the acquisition, which totalled GBP 140.1
million, will be charged against income over a four-year term, resulting in a
pre-tax charge of GBP 8.8 million per quarter.
Review of 2nd Quarter - Revenue for the quarter ended October 31, 1999 was GBP
57.0 million, an increase of 42% compared to the GBP 40.1 million reported for
the quarter ended October 31, 1998. The increase principally reflects the full
inclusion of revenue earned by the INTERSOLV business in the current year.
Operating expenses showed a similar percentage increase. Operating profit before
goodwill charges was GBP 4.7 million, compared to GBP 3.9 million for the
comparable prior year period. Excluding the effect of goodwill charges and
exceptional items, earnings after taxation was GBP 3.5 million, or 2.5 pence per
share, compared to GBP 3.2 million, or 3.1 pence per ordinary share for the
second quarter last year. Amortization of goodwill relating to acquisitions
totaled GBP 9.7 million in the current quarter, compared to GBP 3.9 million in
the corresponding quarter last year. Including the effect of goodwill charges,
loss after taxation was GBP 6.1 million and loss per ordinary share was 4.4
pence, compared to a loss after taxation of GBP 8.8 million and loss per
ordinary share of 8.6 pence for the second quarter of last year.
Review of 1st Half - Revenue for the six months ended October 31, 1999 was GBP
111.9 million, compared to GBP 69.4 million for the six months ended October 31
1998. The increase reflects the full inclusion of revenue earned by the
INTERSOLV business in the current fiscal period. Operating profit before
goodwill charges was GBP 5.5 million, compared to GBP 8.3 million last year.
Excluding the effect of goodwill charges and exceptional items, earnings after
taxation was GBP 4.4 million, or 3.1 pence per ordinary share, compared to GBP
6.7 million, or 7.3 pence per ordinary share for the corresponding prior year
period. Amortization of goodwill relating to acquisitions totaled GBP 18.4
million in the current half year, compared to GBP 4.0 million in the
corresponding period last year. Including the effect of goodwill charges, loss
after taxation was GBP 14.0 million and loss per ordinary share was 10.0 pence,
compared to a loss after taxation of GBP 5.5 million and loss per ordinary share
of 6.0 pence for the corresponding prior year period.
The acquisition of The Marathon Group in August 1999, has been accounted for
using acquisition accounting. Revenue and profit after taxation were not
material in the current period.
Summary financial results are as follows:
<TABLE>
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------
G.B. pounds, U.K. GAAP Three Three Six Six
(in millions, except per months months months months
ordinary share amounts) ended ended ended ended
Oct 31, Oct 31, Oct 31, Oct 31,
1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------
Revenue GBP 57.0m GBP 40.1m GBP 111.9m GBP 69.4m
- ----------------------------------------------------------------------------------------------------------------
EBITA GBP 4.7m GBP 3.9m GBP 5.5m GBP 8.3m
- ----------------------------------------------------------------------------------------------------------------
EPS excluding goodwill 2.5p 3.1p 3.1p 7.3p
- ----------------------------------------------------------------------------------------------------------------
(Loss) after goodwill & taxation (GBP 6.1m) (GBP 8.8m) (GBP 14.0m) (GBP 5.5m)
- ----------------------------------------------------------------------------------------------------------------
(Loss) per ordinary share (4.4p) (8.6p) (10.0p) (6.0p)
- ----------------------------------------------------------------------------------------------------------------
Notes:
* Basis of presentation: in accordance with U.K. GAAP, the INTERSOLV
transaction has been accounted for as an acquisition, and accordingly the
U.K. format results include the results of INTERSOLV from September 24,
1998, the date of its acquisition.
* EBITA is earnings before interest, taxes, goodwill amortization charges,
and exceptional items
</TABLE>
<PAGE> 7
CONSOLIDATED STATEMENTS OF INCOME - IN U.S. FORMAT
<TABLE>
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
(in thousands, except per share and ADS data) Three months Three months Six months Six months
(unaudited) ended ended ended ended
October 31, October 31, October 31, October 31,
1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------------------------
Net revenue
Product revenue $46,542 $42,878 $89,068 $93,604
Maintenance revenue 26,639 25,203 52,019 49,711
Service revenue 18,986 19,078 38,675 39,119
- ----------------------------------------------------------------------------------------------------------------------------------
Total net revenue 92,167 87,159 179,762 182,434
- ----------------------------------------------------------------------------------------------------------------------------------
Cost of revenue
Cost of product revenue 2,273 2,942 4,828 5,704
Cost of maintenance revenue 6,010 6,427 11,704 12,630
Cost of service revenue 14,731 16,517 29,647 33,833
- ----------------------------------------------------------------------------------------------------------------------------------
Total cost of revenue 23,014 25,886 46,179 52,167
- ----------------------------------------------------------------------------------------------------------------------------------
Gross profit 69,153 61,273 133,583 130,267
- ----------------------------------------------------------------------------------------------------------------------------------
Operating expenses
Research and development 15,417 15,249 29,909 30,729
Sales and marketing 39,268 37,722 80,098 73,798
General and administrative 6,807 7,398 14,619 14,476
One time charges - 49,662 - 49,662
- ----------------------------------------------------------------------------------------------------------------------------------
Total operating expenses 61,492 110,031 124,626 168,665
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) before goodwill amortization 7,661 (48,758) 8,957 (38,398)
Goodwill amortization 1,746 739 2,724 1,508
- ----------------------------------------------------------------------------------------------------------------------------------
Income from operations 5,915 (49,497) 6,233 (39,906)
Interest income, net 778 1,619 1,791 3,029
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) before income taxes 6,693 (47,878) 8,024 (36,877)
Income taxes (2,410) 5,574 (2,889) 1,802
- ----------------------------------------------------------------------------------------------------------------------------------
Net income (loss) $4,283 ($42,304) $5,135 ($35,075)
- ----------------------------------------------------------------------------------------------------------------------------------
Net income (loss) per share: basic $0.03 ($0.29) $0.04 ($0.25)
Net income (loss) per ADS: basic $0.15 ($1.47) $0.18 ($1.23)
- ----------------------------------------------------------------------------------------------------------------------------------
Shares used in computing basic net income (loss) per share 144,220 143,642 144,006 143,130
Shares used in computing basic net income (loss) per ADS 28,844 28,728 28,801 28,626
- ----------------------------------------------------------------------------------------------------------------------------------
Net income (loss) per share: diluted $0.03 ($0.29) $0.04 ($0.25)
Net income (loss) per ADS: diluted $0.14 ($1.47) $0.17 ($1.23)
- ----------------------------------------------------------------------------------------------------------------------------------
Shares used in computing diluted net income (loss) per share 150,554 143,642 149,580 143,130
Shares used in computing diluted net income (loss) per ADS 30,111 28,728 29,916 28,626
- ----------------------------------------------------------------------------------------------------------------------------------
Excluding one time charges:
Income before income taxes 6,693 1,784 8,024 12,785
Net income 4,283 1,123 5,135 8,352
Net income per ADS: diluted $0.14 $0.04 $0.17 $0.28
- ----------------------------------------------------------------------------------------------------------------------------------
Note: Each American Depositary Share, or ADS, represents five ordinary shares.
</TABLE>
<PAGE> 8
CONSOLIDATED BALANCE SHEETS - IN U.S. FORMAT
- --------------------------------------------------------------------------
(in thousands) October 31, April 30,
1999 1999
(Unaudited)
- --------------------------------------------------------------------------
Assets
Current assets:
Cash and cash equivalents $86,666 $86,580
Short-term investments 24,949 34,804
Accounts receivable, net 98,784 111,317
Prepaid expenses and other assets 11,549 13,485
- --------------------------------------------------------------------------
Total current assets 221,948 246,186
- --------------------------------------------------------------------------
Fixed assets:
Property, plant and equipment, net 48,726 46,090
Goodwill, net 23,945 10,239
Software product assets, net 14,979 17,007
Other assets 3,134 3,560
- --------------------------------------------------------------------------
Total assets $312,732 $323,082
- --------------------------------------------------------------------------
Liabilities and shareholders' equity
Current liabilities:
Borrowings $1,520 $2,716
Accounts payable 8,942 12,150
Accrued employee compensation 19,536 24,352
Income taxes payable 18,369 18,325
Deferred revenue 59,710 69,155
Other current liabilities 24,166 29,869
- --------------------------------------------------------------------------
Total current liabilities 132,243 156,567
- --------------------------------------------------------------------------
Deferred income taxes 16,625 14,304
- --------------------------------------------------------------------------
Total liabilities $148,868 $170,871
- --------------------------------------------------------------------------
Shareholders' equity:
Ordinary shares 4,715 4,691
Additional paid-in capital 157,017 154,868
and other reserves
Treasury stock (7,393) (7,552)
Retained earnings 13,985 8,850
Accumulated other comprehensive loss (4,460) (8,646)
- --------------------------------------------------------------------------
Total shareholders' equity $163,864 $152,211
- --------------------------------------------------------------------------
Total liabilities and shareholders' equity $312,732 $323,082
- --------------------------------------------------------------------------
<PAGE> 9
CONSOLIDATED PROFIT & LOSS ACCOUNT - IN U.K. FORMAT
<TABLE>
<S> <C> <C> <C> <C>
In thousands, except per share data Three months Three months Six months Six months
ended ended ended ended
October 31, October 31, October 31, October 31,
1999 1998 1999 1998
(unaudited) (unaudited) (unaudited) (unaudited)
GBP'000 GBP'000 GBP'000 GBP'000
- -------------------------------------------------------------------------------------------------------------------
Revenue
Product revenue 28,687 21,735 55,436 39,807
Maintenance revenue 16,590 10,871 32,405 18,712
Service revenue 11,753 7,532 24,084 10,892
- -------------------------------------------------------------------------------------------------------------------
Total revenue 57,030 40,138 111,925 69,411
- -------------------------------------------------------------------------------------------------------------------
Cost of revenue
Cost of product revenue 1,415 1,665 3,012 2,801
Cost of maintenance revenue 3,725 5,328 7,293 7,731
Cost of service revenue 9,180 2,992 18,455 5,869
- -------------------------------------------------------------------------------------------------------------------
Total cost of revenue 14,320 9,985 28,760 16,401
- -------------------------------------------------------------------------------------------------------------------
Gross profit 42,710 30,153 83,165 53,010
- -------------------------------------------------------------------------------------------------------------------
Operating expenses
Research and development 9,504 6,405 18,573 11,547
Sales and marketing 24,422 16,620 49,886 27,648
General and administrative 4,069 3,259 9,205 5,548
- -------------------------------------------------------------------------------------------------------------------
Total operating expenses 37,995 26,284 77,664 44,743
- -------------------------------------------------------------------------------------------------------------------
Operating profit before amortisation of goodwill 4,715 3,869 5,501 8,267
Amortisation of goodwill 9,660 3,862 18,414 3,998
- -------------------------------------------------------------------------------------------------------------------
Operating (loss)/profit (4,945) 7 (12,913) 4,269
Exceptional item - fundamental restructuring - (11,831) - (11,831)
- -------------------------------------------------------------------------------------------------------------------
(Loss) before interest and taxation (4,945) (11,824) (12,913) (7,562)
Interest income, net 682 972 1,320 1,684
- -------------------------------------------------------------------------------------------------------------------
(Loss) before taxation (4,263) (10,852) (11,593) (5,878)
Taxation (1,864) 2,025 (2,456) 408
- -------------------------------------------------------------------------------------------------------------------
(Loss) for the period after taxation (6,127) (8,827) (14,049) (5,470)
- -------------------------------------------------------------------------------------------------------------------
(Loss) per share: basic (4.4p) (8.6p) (10.0p) (6.0p)
(Loss) per share: diluted (4.4p) (8.6p) (10.0p) (6.0p)
- -------------------------------------------------------------------------------------------------------------------
Number of shares: basic 140,522 102,802 140,254 91,216
Number of shares: diluted 140,522 102,802 140,254 91,216
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 10
CONSOLIDATED BALANCE SHEET - IN U.K. FORMAT
- -----------------------------------------------------------------------------
In thousands October 31, April 30,
1999 1999
(Unaudited)
GBP'000 GBP'000
- -----------------------------------------------------------------------------
Fixed assets:
Intangible fixed assets 124,092 133,976
Tangible fixed assets 29,711 28,633
Investments 4,508 4,691
- -----------------------------------------------------------------------------
Total fixed assets 158,311 167,300
- -----------------------------------------------------------------------------
Current assets:
Stock 1,285 1,780
Trade debtors 60,234 70,682
Other debtors and prepaid expenses 7,709 7,205
Cash and bank deposits 68,058 75,394
- -----------------------------------------------------------------------------
Total current assets 137,286 155,061
- -----------------------------------------------------------------------------
Creditors: amounts falling due within one year
Bank loans and overdrafts 927 1,696
Trade creditors 5,453 7,546
Accrued employee compensation 11,912 15,126
Current corporation tax 6,775 11,534
Accrued expenses and other current liabilities 12,166 13,835
Deferred revenue 36,408 42,954
- -----------------------------------------------------------------------------
Total current liabilities 73,641 92,691
- -----------------------------------------------------------------------------
Net current assets 63,645 62,370
- -----------------------------------------------------------------------------
Total assets less current liabilities 221,956 229,670
Creditors: amounts falling due after more than one year 0 6
Provision for liabilities and charges 12,706 12,555
- -----------------------------------------------------------------------------
Net assets 209,250 217,109
- -----------------------------------------------------------------------------
Capital and reserves
Called up share capital 2,888 2,873
Share premium account and other reserves 190,577 189,261
Profit and loss account 15,785 24,975
- -----------------------------------------------------------------------------
Total shareholders' equity 209,250 217,109
- -----------------------------------------------------------------------------
<PAGE> 11
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.
MERANT plc
(Registrant)
Date: November 16, 1999 By: /s/ Kenneth A. Sexton
---------------------------------------
Kenneth A. Sexton
Chief Financial Officer
