<PAGE> 1
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended November 30, 1997.
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________________ to _________________
COMMISSION FILE NO. 0-20189
EQUITRAC CORPORATION
(Exact name of Registrant as specified in its charter)
FLORIDA 59-1797862
(State or other jurisdiction of (IRS Employee
incorporation or organization) Identification Number)
836 PONCE DE LEON BOULEVARD
CORAL GABLES, FLORIDA 33134
(305) 442-2060
(Address, including zip code, and telephone number,
including area code, of registrant's
principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to the
filing requirements for at least the past 90 days. Yes X No .
--- ---
As of January 9, 1998, there were 3,487,300 shares of the Registrant's
common stock, par value $.01, outstanding.
- --------------------------------------------------------------------------------
<PAGE> 2
EQUITRAC CORPORATION
INDEX
PAGE
----
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets
as of November 30, 1997
and February 28, 1997 2
Condensed Statements of Income
for the three months and nine months
ended November 30, 1997 and 1996 3
Condensed Statement of
Stockholders' Equity for the
nine months ended November 30, 1997 4
Condensed Statements of Cash Flows
for the nine months ended
November 30, 1997 and 1996 5
Notes to Condensed Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 14
<PAGE> 3
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
EQUITRAC CORPORATION
CONDENSED BALANCE SHEETS
(in thousands, except share data)
<TABLE>
<CAPTION>
(Unaudited)
NOVEMBER 30, FEBRUARY 28,
1997 1997
------------- -------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 4,125 $ 4,755
Investment securities 5,128 4,817
Accounts receivable, net of allowances of $600 and $550 at
November 30, and February 28, respectively 8,104 6,117
Inventories 2,052 2,483
Deferred income taxes 571 581
Other current assets 392 313
-------- --------
Total current assets 20,372 19,066
Investment securities 2,483 1,330
Property and equipment, net 6,204 6,317
Intangible assets, net 3,367 3,378
Deferred income taxes 397 397
Other assets 188 194
-------- --------
Total assets $ 33,011 $ 30,682
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 747 $ 1,095
Accrued expenses and other current liabilities 4,018 3,930
Unearned income 1,445 882
-------- --------
Total current liabilities 6,210 5,907
-------- --------
Stockholders' equity:
Common stock, $.01 par value; 15,000,000 shares
authorized; 3,858,100 and 3,800,300 shares issued
at November 30, and February 28, respectively 39 38
Additional paid-in capital 11,066 10,741
Retained earnings 17,927 15,672
Cumulative translation adjustment (59) (23)
Unrealized gain on investment securities, net of tax 15 --
Treasury stock, at cost (370,800 and 330,800 shares at
November 30, and February 28, respectively) (2,187) (1,653)
-------- --------
Total stockholders' equity 26,801 24,775
-------- --------
Total liabilities and stockholders' equity $ 33,011 $ 30,682
======== ========
</TABLE>
See accompanying notes.
2
<PAGE> 4
EQUITRAC CORPORATION
CONDENSED STATEMENTS OF INCOME
(Unaudited)
(in thousands, except earnings per share)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
NOVEMBER 30, NOVEMBER 30,
--------------------------- -----------------------
1997 1996 1997 1996
----------- ------------ ----------- --------
<S> <C> <C> <C> <C>
Revenues:
Sales $ 5,512 $ 4,574 $ 16,480 $12,984
Service and support 4,306 3,450 12,242 9,784
Rental 2,626 2,575 7,821 7,788
----------- ------------ ----------- --------
Total revenues 12,444 10,599 36,543 30,556
----------- ------------ ----------- --------
Expenses:
Cost of revenues 5,223 4,036 15,065 11,365
Product development 669 574 2,150 1,534
Selling expenses 1,697 1,696 5,190 4,866
General and administrative 3,705 3,341 10,926 10,072
----------- ------------ ----------- --------
Total expenses 11,294 9,647 33,331 27,837
----------- ------------ ----------- --------
Operating income 1,150 952 3,212 2,719
Interest income 165 125 435 359
----------- ------------ ----------- --------
Income before income taxes 1,315 1,077 3,647 3,078
Income taxes 500 416 1,392 1,192
----------- ------------ ----------- --------
Net income $ 815 $ 661 $ 2,255 $ 1,886
=========== ============ =========== ========
Earnings per share $ 0.22 $ 0.18 $ 0.61 $ 0.53
=========== ============ =========== ========
Weighted average common and common equivalent
shares outstanding 3,779 3,578 3,729 3,541
=========== ============ =========== ========
</TABLE>
See accompanying notes.
3
<PAGE> 5
EQUITRAC CORPORATION
CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)
(in thousands, except number of shares)
<TABLE>
<CAPTION>
Common Unrealized
Stock and Gain on
Additional Cumulative Investment Total
Common Paid-in Retained Translation Securities, Treasury Stockholders'
Shares Capital Earnings Adjustment Net of Tax Stock Equity
--------- ---------- --------- ----------- ---------- --------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, February 28, 1997 3,800,300 $ 10,779 $ 15,672 $ (23) $ -- $ (1,653) $ 24,775
Purchase of Treasury Stock
25,000 shares -- -- -- -- -- (534) (534)
Unrealized gain on marketable
securities, net of tax -- -- -- -- 15 -- 15
Translation Adjustment -- -- -- (36) -- -- (36)
Exercise of employee
stock options 57,800 326 -- -- -- -- 326
Net income for the nine months
ended November 30, 1997 -- -- 2,255 -- -- -- 2,255
--------- --------- --------- --------- --------- --------- ---------
Balance, November 30, 1997 3,858,100 $ 11,105 $ 17,927 $ (59) $ 15 $ (2,187) $ 26,801
========= ========= ========= ========= ========= ========= =========
</TABLE>
See accompanying notes
4
<PAGE> 6
EQUITRAC CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
NOVEMBER 30,
------------------------
1997 1996
------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 2,255 $ 1,886
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 2,147 1,835
Amortization 905 808
Provision for doubtful accounts 50 50
Change in assets and liabilities:
(Increase) decrease in:
Accounts receivable (1,681) (2,007)
Inventories 456 (437)
Other current assets (51) (35)
Other assets 6 (17)
Increase (decrease) in:
Accounts payable (518) --
Accrued expenses 88 (88)
Unearned income 446 253
------- -------
Net cash provided by operating activities 4,103 2,248
------- -------
Cash flows from investing activities:
Purchases of property and equipment (2,027) (1,911)
Acquisitions, principally intangible assets (1,023) (1,834)
Sales and maturities of investment securities 2,255 1,348
Purchases of investment securities (3,694) (1,709)
Decrease in restricted cash -- 1,450
------- -------
Net cash used in investing activities (4,489) (2,656)
------- -------
Cash flows from financing activities:
Repayment of acquisition obligations -- (30)
Proceeds from issuance of common stock 326 135
Purchase of treasury stock (534) --
------- -------
Net cash (used in) provided by financing activities (208) 105
------- -------
Exchange rate effect on cash (36) 13
------- -------
Net decrease in cash and cash equivalents (630) (290)
Cash and cash equivalents at beginning of period 4,755 3,581
------- -------
Cash and cash equivalents at end of period $ 4,125 $ 3,291
======= =======
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes $ 1,825 $ 1,820
</TABLE>
Non-cash investing and financing activities during the nine months ended
November 30, 1996 included $611,000 of intangible assets acquired through the
assumption of a liability to fulfill service contracts in connection with the
Infortext Acquisition and a $10,000 reduction in intangible assets resulting
from the reduction of a liability in connection with a contingent consideration
adjustment related to an acquisition.
See accompanying notes.
5
<PAGE> 7
EQUITRAC CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements have been
prepared by the Company, in accordance with generally accepted accounting
principles, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosure normally
included in financial statements have been condensed or omitted pursuant to
such rules and regulations. In the opinion of management, the accompanying
financial statements include all adjustments (of a normal recurring nature)
which are necessary to state fairly the results for the interim periods
presented. The results for the nine months ended November 30, 1997 are not
necessarily indicative of the results to be expected for the full fiscal
year. These unaudited condensed financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Annual Report on Form 10-K for the fiscal year ended February 28, 1997,
filed with the Securities and Exchange Commission.
2. USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principals requires management to make estimates and
assumptions that affect the reported amounts in the financial statements
and accompanying notes. Actual results could differ from those estimates.
3. REVENUE RECOGNITION
Sales revenue is recognized upon installation and customers'
acceptance. Service and support revenues are recognized ratably over the
period in which the service and support are provided. Rental contract
revenue, which includes service and support on the underlying rental
equipment and software, is recognized ratably over the term of the
respective lease. Rental contracts are accounted for as operating leases.
4. CASH AND CASH EQUIVALENTS
All investments in highly liquid marketable securities with a maturity
of three months or less at the time of purchase are classified as cash
equivalents.
5. INVESTMENT SECURITIES
The Company's investment securities consist primarily of municipal
bonds, U.S. Treasury obligations and investment grade corporate bonds with
maturities ranging from one to twenty-two years. These investments are
classified as available-for-sale and are recorded at fair value with
unrealized gains and losses included in stockholders' equity.
Interest income is recognized when earned.
6
<PAGE> 8
6. INVENTORIES
Inventories comprised primarily of system components, parts and
supplies are carried at the lower of weighted average cost or market. The
weighted average cost of inventories approximates the "first in-first out"
(FIFO) method.
7. PROPERTY AND EQUIPMENT
Property and equipment consist primarily of system rental equipment
under operating leases and service equipment used in connection with
service contracts, and are stated at cost less accumulated depreciation.
Additions, major renewals and improvements are capitalized, and repair and
maintenance costs are expensed. Upon retirement or sale, the cost of the
assets disposed of and the related accumulated depreciation are removed
from the accounts and any resulting gain or loss is included in the
determination of net income. Property and equipment are depreciated using
the straight-line method over the estimated useful lives of the assets.
Leasehold improvements are amortized using the straight-line method over
the shorter of the estimated life of the asset or the remaining term of the
lease.
8. PRODUCT DEVELOPMENT COSTS
Product development costs are expensed as incurred.
9. FOREIGN CURRENCY TRANSLATION
Translation of foreign currencies into U.S. dollars is computed for
revenue and expense accounts using average exchange rates during the year.
Net assets of the Company's Canadian operations, whose "functional
currency" is the Canadian dollar are translated at current rates of
exchange, with the resulting translation adjustment recorded directly into
a separate component of stockholders' equity. The functional currency for
the Company's other foreign operations is the U.S. dollar. Net assets of
these operations are translated at current rates of exchange, with the
resulting translation gains and losses included in the statement of income.
10. EARNINGS PER SHARE
Earnings per share (EPS) are based on the weighted average number of
shares of common stock and common stock equivalents outstanding during the
year. Common stock equivalents consist of stock options.
11. ACQUISITIONS
Intangible assets recorded in connection with acquisitions represent
costs allocated to specifically identifiable intangible assets and the
excess of cost over the fair value of tangible and identifiable intangible
assets arising from acquisitions ("goodwill"). The costs of all
identifiable intangible assets and goodwill are amortized on a
straight-line basis over their respective estimated useful lives, ranging
from three to seven years.
7
<PAGE> 9
12. CONTINGENCIES
The Company is involved from time to time in legal proceedings incident
to the normal course of its business. Management believes that adverse
decisions in any pending or threatened proceedings would not have a
material adverse effect on the Company's financial positions or results of
operations.
13. RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform with
current year presentation.
8
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The Company's revenues are derived from three principal sources: (1) sales
of new systems, upgrades and add-ons of equipment or software; (2) monthly
revenues from service and software support agreements and (3) monthly revenues
from leases of its systems. The Company offers its customers the option of
purchasing a system or leasing a system pursuant to an operating lease (the term
of which is typically 36 months or longer), which includes all service and
software support. The Company offers its purchase customers service and software
support agreements (the terms of which are typically for 36 months or longer).
Systems that are not purchased in conjunction with a service contract are
serviced by the Company on a time-and-materials basis. The Company's computer
service division offers its customers service agreements (the terms of which are
typically for 12 months) and also provides service on a time-and-materials
basis.
The following table sets forth selected items in the Condensed Statements
of Income as a percentage of total revenues.
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
NOVEMBER 30, NOVEMBER 30,
---------------------- ----------------------
1997 1996 1997 1996
------- ------- ------- -------
<S> <C> <C> <C> <C>
Revenues:
Sales 44.3% 43.2% 45.1% 42.5%
Service and support 34.6 32.5 33.5 32.0
Rental 21.1 24.3 21.4 25.5
------- ------- ------- -------
Total revenues 100.0 100.0 100.0 100.0
------- ------- ------- -------
Expenses:
Cost of revenues 42.0 38.1 41.2 37.2
Product development 5.4 5.4 5.9 5.0
Selling expenses 13.6 16.0 14.2 15.9
General and administrative 29.8 31.5 30.0 33.0
------- ------- ------- -------
Total expenses 90.8 91.0 91.3 91.1
------- ------- ------- -------
Operating income 9.2 9.0 8.7 8.9
Interest income 1.3 1.1 1.2 1.2
------- ------- ------- -------
Income before income taxes 10.5 10.1 9.9 10.1
Income taxes 4.0 3.9 3.8 3.9
------- ------- ------- -------
Net income 6.5% 6.2% 6.1% 6.2%
======= ======= ======= =======
</TABLE>
9
<PAGE> 11
REVENUES
Total revenues for the third quarter ended November 30, 1997 increased 17%
to $12,444,000 from $10,599,000 in the same quarter last fiscal year. For the
nine months ended November 30, 1997, total revenues were $36,543,000, an
increase of 20% over revenues of $30,556,000 recorded in the same nine month
period in the prior fiscal year. The Company's total revenues increased
primarily as a result of increases in sales revenues and service and support
revenues. System sales revenues were comprised primarily of revenues from sales
of new systems to existing customers and, to a lesser extent, from sales of new
systems to new customers and from sales of add-on equipment to existing
customers. Service and support revenues and rental revenues were comprised
primarily of recurring revenues from existing maintenance and lease agreements.
SALES REVENUES. Sales revenues for the quarter ended November 30, 1997
increased 21% to $5,512,000 from $4,574,000 in the same quarter last fiscal
year. Sales revenues for the nine months ended November 30, 1997 increased 27%
to $16,480,000 from $12,984,000 in the same nine month period last fiscal year.
This increase resulted primarily from an increase in computer equipment resale
revenues from the ECS division due to increased market presence and an increase
in sales of systems manufactured by the Company. Sales revenues included
equipment resale revenues generated by the ECS division of $813,000 and
$2,382,000 during the quarter and nine months ended November 30, 1997, an
increase over revenues of $206,000 and $544,000 in the same quarter and nine
month period last fiscal year. The remaining increases resulted from an increase
in volume of sales of new systems to existing customers and from sales of add-on
equipment to existing customers.
SERVICE AND SUPPORT REVENUES. Service and support revenues for the quarter
ended November 30, 1997 increased 25% to $4,306,000 from $3,450,000 in the same
quarter last fiscal year. Service and support revenues for the nine months ended
November 30, 1997 increased 25% to $12,242,000 from $9,784,000 in the same nine
month period last fiscal year. The increase resulted primarily from an increase
in service and support revenues generated by the ECS division and an increase in
service contracts in the Company's cost recovery divisions. Service and support
revenue generated by the ECS division increased to $671,000 and $1,692,000
during the quarter and nine months ended November 30, 1997, respectively from
$260,000 and $623,000 in the same quarter and nine month period last fiscal
year.
RENTAL REVENUE. Rental revenues for the quarter ended November 30, 1997
were $2,626,000 compared to $2,575,000 in the same quarter last fiscal year.
Rental revenues for the nine months ended November 30, 1997 increased to
$7,821,000 from $7,788,000 in the same nine month period last fiscal year.
10
<PAGE> 12
EXPENSES
COST OF REVENUES. Cost of revenues is comprised primarily of (i) payroll
and other expenses related to the Company's manufacturing, customer support and
service personnel, (ii) the cost of hardware and other system components
associated with system sales and service and (iii) depreciation of system rental
and service units. Cost of revenues for the quarter ended November 30, 1997
increased to $5,223,000, or 42.0% of total revenues, from $4,036,000, or 38.1%
of total revenues, in the same quarter last fiscal year. Cost of revenues for
the nine months ended November 30, 1997 increased to $15,065,000, or 41.2% of
total revenues, from $11,365,000, or 37.2% of total revenues. This increase in
the cost of revenues as a percentage of total revenues is attributable to lower
gross margins in the Company's ECS division compared to the Company's cost
recovery divisions. Management anticipates that the cost of revenues as a
percentage of total revenues may continue to increase in future periods to the
extent that the ECS division contributes a higher percentage of the Company's
revenues.
PRODUCT DEVELOPMENT EXPENSES. Product development expenses for the quarter
ended November 30, 1997 increased to $669,000, or 5.4% of total revenues from
$574,000, or 5.4% of total revenues, in the same quarter last fiscal year.
Product development expenses for the nine months ended November 30, 1997
increased to $2,150,000, or 5.9% of total revenues, from $1,534,000, or 5.0% of
total revenues, in the same nine month period last fiscal year. Current
development efforts are focused on enhancing and expanding the Equitrac and
Infortext cost recovery product lines as well as developing several new
products. Products under development during these periods include (i)
TelemeTrac(TM), a product which collects and consolidates photocopier meter
totals remotely through cellular telephone networks, (ii) PrintLog(TM), a
digital output tracking application designed to track all pages printed from a
workstation to laser printers and network photocopiers and assign each
transaction to a client, project or department, (iii) OneTrac(TM), an
inexpensive copy and fax control product line developed for resale through both
the Equitrac direct sales force and through copier dealers, and (iv) an
exclusive OEM product line for Pitney Bowes. Management anticipates deriving
revenues from some of these products beginning in the fourth quarter of fiscal
1998 and to a greater extent in fiscal 1999. The Company does not capitalize any
of its software product development costs since software development costs
incurred subsequent to attainment of technological feasibility of a new product
line are not deemed to be significant; accordingly, product development expenses
for each period include all hardware and software development costs incurred
during the period. Management anticipates that product development costs will
continue to increase in future periods compared to the respective periods in the
previous fiscal year, as the projects under development are completed and the
Company invests in the development of additional products.
SELLING EXPENSES. Selling expenses for the quarter ended November 30, 1997
increased to $1,697,000, or 13.6% of total revenues from $1,696,000, or 16.0% of
total revenues, in the same quarter last fiscal year. Selling expenses for the
nine months ended November 30, 1997 increased to $5,190,000, or 14.2% of total
revenues, from $4,866,000, or 15.9% of total revenues, in the same nine month
period last fiscal year. These decreases in selling expenses as a percentage of
revenues resulted primarily from incremental revenues derived per sales
representative during the quarter and nine months ended November 30, 1997
compared to the same quarter and nine month period last fiscal year.
11
<PAGE> 13
GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
for the quarter ended November 30, 1997 increased to $3,705,000, or 29.8% of
total revenues, from $3,341,000, or 31.5% of total revenues, in the same quarter
last fiscal year. General and administrative expenses for the nine months ended
November 30, 1997 increased to $10,926,000, or 30.0% of total revenues, from
$10,072,000, or 33.0% of total revenues, in the same nine month period last
fiscal year. These decreases in general and administrative expenses as a
percentage of revenues resulted primarily from the Company's ability to increase
revenues through internal sales growth without adding a commensurate level of
support and administrative positions.
INTEREST INCOME. The Company's interest income increased to $165,000 during
the quarter ended November 30, 1997 from $125,000 during the same quarter last
fiscal year. Interest income for the nine months ended November 30, 1997
increased to $435,000 from $359,000 in the same nine month period last fiscal
year.
INCOME TAXES. The Company's effective income tax rate was 38.0% and 38.1%
for the quarter and nine months ended November 30, 1997, compared to 38.6% and
38.7% in the same quarter and nine month period last fiscal year. The decrease
in the Company's effective tax rate resulted primarily from the increase in the
Company's research and development tax credit due to the increase in product
development expenditures.
LIQUIDITY AND CAPITAL RESOURCES
The Company has funded its operations over the past several years
principally from cash flow from operations. The Company's cash and cash
equivalents and investment securities increased to $11,736,000 at November 30,
1997 from $10,902,000 at February 28, 1997. The Company generated $4,103,000 in
cash from operating activities during the nine months ended November 30, 1997.
Cash flows used in investing activities included the acquisition of $2,027,000
of property and equipment, primarily system rental units which are leased to
customers and system service units which are used to service customers with
service contracts.
The Board of Directors has authorized the Company to spend up to $2,000,000
to repurchase shares of the Company's issued and outstanding common stock, based
upon consideration of the Company's current cash position, management's
expectations of future cash flows from operating activities and the level of
cash required to fund future growth opportunities. Through November 30, 1997,
the Company repurchased 370,800 shares of its outstanding common stock at an
aggregate purchase price of $2,187,000. Future purchases will be made from time
to time subject to prevailing market conditions in open market or privately
negotiated transactions.
The Company anticipates that its cash and cash equivalents and marketable
securities and cash flow from operating activities will be adequate to meet the
Company's cash requirements for the foreseeable future.
12
<PAGE> 14
FORWARD LOOKING STATEMENTS
Certain statements in this Form 10-Q, including statements contained
herein under the caption "Management's Discussion and Analysis of Financial
Condition and Results of Operations", constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance or
achievements express or implied by such forward-looking statements. Such factors
include, but are not limited to the following: general economic and business
conditions; charges and costs related to acquisitions; and the ability of the
Company to develop and market products for the markets in which it operates, to
successfully integrate its acquired products and services, to adjust to changes
in technology, customer preferences, enhanced competition and new competitors in
the markets in which it operates.
13
<PAGE> 15
PART II OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
A. Exhibits
11. Statement of Computation of Earnings per Share
B. Reports on Form 8-K
None.
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 thereunto duly
authorized.
EQUITRAC CORPORATION
Date: January 14, 1998 By: /s/ GEORGE P. WILSON
--------------------------------
George P. Wilson
President and Chief
Executive Officer
Date: January 14, 1998 By: /s/ SCOTT J. MODIST
--------------------------------
Scott J. Modist
Vice President - Finance,
Treasurer and Chief Financial
Officer
14
<PAGE> 1
EXHIBIT 11
EQUITRAC CORPORATION
COMPUTATION OF EARNINGS PER SHARE
(in thousands, except earnings per share)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
NOVEMBER 30, NOVEMBER 30,
------------------- -------------------
1997 1996 1997 1996
----- ----- ----- -----
<S> <C> <C> <C> <C>
Weighted average number of common shares
outstanding 3,497 3,413 3,483 3,402
Common share equivalents arising from dilutive
options 282 165 246 139
----- ----- ----- -----
3,779 3,578 3,729 3,541
===== ===== ===== =====
Earnings per share $0.22 $0.18 $0.61 $0.53
===== ===== ===== =====
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AS OF NOVEMBER 30, 1997 AND INCOME STATEMENT FOR THE NINE MONTHS ENDED
NOVEMBER 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FORM
10-Q FILING.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> NOV-30-1997
<CASH> 4,125,000
<SECURITIES> 5,128,000
<RECEIVABLES> 8,704,000
<ALLOWANCES> 600,000
<INVENTORY> 2,052,000
<CURRENT-ASSETS> 20,372,000
<PP&E> 14,199,249
<DEPRECIATION> 7,995,143
<TOTAL-ASSETS> 33,011,000
<CURRENT-LIABILITIES> 6,210,000
<BONDS> 0
0
0
<COMMON> 39,000
<OTHER-SE> 26,762,000
<TOTAL-LIABILITY-AND-EQUITY> 33,011,000
<SALES> 16,480,000
<TOTAL-REVENUES> 36,543,000
<CGS> 15,065,000
<TOTAL-COSTS> 5,190,000
<OTHER-EXPENSES> 13,076,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
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