<PAGE>
FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: July 4, 1998
------------------------
Commission file number: 1-11908
--------------------------------
Department 56, Inc.
-------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3684956
--------------- --------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Village Place, 6436 City West Parkway, Eden Prairie, MN 55344
-----------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(612) 944-5600
----------------------------------
(Registrant's telephone number, including area code)
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 such
filing requirements for the past 90 days.
Yes X No
------- -------
As of July 4, 1998, 18,668,535 shares of the registrant's common stock, par
value $.01 per share, were outstanding.
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DEPARTMENT 56, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
ASSETS
JULY 4, JANUARY 3,
1998 1998
--------- ----------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 1,492 $ 37,361
Accounts receivable, net 83,493 23,004
Inventories 23,608 18,070
Other current assets 10,733 9,311
--------- ----------
Total current assets 119,326 87,746
PROPERTY AND EQUIPMENT, net 13,836 12,753
GOODWILL, TRADEMARKS AND OTHER, net 159,512 159,042
OTHER ASSETS 135 154
--------- ----------
$ 292,809 $ 259,695
--------- ----------
--------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Revolving line of credit $ 37,000 $ -
Current portion of long-term debt 20,000 20,000
Accounts payable 9,747 9,973
Other current liabilities 20,971 16,916
--------- ----------
Total current liabilities 87,718 46,889
DEFERRED TAXES 6,151 6,151
LONG-TERM DEBT 20,000 20,000
STOCKHOLDERS' EQUITY 178,940 186,655
--------- ----------
$ 292,809 $ 259,695
--------- ----------
--------- ----------
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE>
DEPARTMENT 56, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
QUARTER QUARTER
ENDED ENDED
JULY 4, JULY 5,
1998 1997
---- ----
<S> <C> <C>
NET SALES $ 69,920 $ 58,564
COST OF SALES 28,710 24,704
----------- ----------
Gross profit 41,210 33,860
OPERATING EXPENSES:
Selling, general, and administrative 13,670 11,400
Amortization of goodwill, trademarks and other 1,258 1,144
Recovery of import duties (65) -
----------- ----------
Total operating expenses 14,863 12,544
----------- ----------
INCOME FROM OPERATIONS 26,347 21,316
OTHER EXPENSE (INCOME)
Interest expense 970 1,095
Other, net (26) (274)
----------- ----------
INCOME BEFORE INCOME TAXES 25,403 20,495
PROVISION FOR INCOME TAXES 10,034 8,096
----------- ----------
NET INCOME $ 15,369 $ 12,399
----------- ----------
----------- ----------
NET INCOME PER COMMON SHARE $ 0.81 $ 0.60
----------- ----------
----------- ----------
NET INCOME PER COMMON SHARE ASSUMING DILUTION $ 0.80 $ 0.59
----------- ----------
----------- ----------
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE>
DEPARTMENT 56, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
26 WEEKS 27 WEEKS
ENDED ENDED
JULY 4, JULY 5,
1998 1997
---- ----
<S> <C> <C>
NET SALES $ 118,947 $ 104,293
COST OF SALES 49,304 43,816
--------- ---------
Gross profit 69,643 60,477
OPERATING EXPENSES:
Selling, general, and administrative 25,299 22,494
Amortization of goodwill, trademarks and other 2,410 2,288
Recovery of import duties (65) (370)
--------- ---------
Total operating expenses 27,644 24,412
--------- ---------
INCOME FROM OPERATIONS 41,999 36,065
OTHER EXPENSE (INCOME)
Interest expense 1,741 2,170
Other, net (418) (1,018)
--------- ---------
INCOME BEFORE INCOME TAXES 40,676 34,913
PROVISION FOR INCOME TAXES 16,067 13,791
--------- ---------
NET INCOME $ 24,609 $ 21,122
--------- ---------
--------- ---------
NET INCOME PER COMMON SHARE $ 1.28 $ 1.00
--------- ---------
--------- ---------
NET INCOME PER COMMON SHARE ASSUMING DILUTION $ 1.26 $ 0.99
--------- ---------
--------- ---------
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE>
DEPARTMENT 56, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
26 WEEKS 27 WEEKS
ENDED ENDED
JULY 4, JULY 5,
1998 1997
----------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash used in operating activities $(34,010) $(12,511)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (1,299) (710)
Acquisitions (4,660) -
-------- ---------
Net cash used in investing activities (5,959) (710)
-------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 2,530 272
Net borrowings under revolving credit facility 37,000 -
Stock repurchases (35,430) (15,561)
-------- ---------
Net cash provided by (used in) financing activities 4,100 (15,289)
-------- ---------
NET DECREASE IN CASH AND CASH EQUIVALENTS (35,869) (28,510)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 37,361 46,405
-------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,492 $ 17,895
-------- ---------
-------- ---------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for:
Interest $ 1,586 $ 2,171
Income taxes $ 12,433 $ 12,204
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE>
DEPARTMENT 56, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying condensed consolidated balance sheet as of January 3, 1998
was derived from the audited consolidated balances as of that date. The
remaining accompanying condensed consolidated financial statements are unaudited
and, in the opinion of management, include all adjustments necessary for a fair
presentation. Such adjustments were of a normal recurring nature.
The results of operations for the quarter ended July 4, 1998 and the 26
weeks ended July 4, 1998 are not necessarily indicative of the results for the
full fiscal year.
It is suggested that these financial statements be read in conjunction with
the consolidated financial statements and notes thereto included in the 1997
Annual Report to Stockholders and Annual Report on Form 10-K filed by Department
56, Inc. (the "Company") with the Securities and Exchange Commission.
2. INCOME PER COMMON SHARE
Net income per common share is calculated by dividing net income by the
weighted average number of shares outstanding during the period. Net income per
common share assuming dilution reflects per share amounts that would have
resulted had the Company's outstanding stock options been converted to common
stock.
3. STOCKHOLDERS' EQUITY
On April 29, 1998, the Board of Directors of the Company authorized a stock
repurchase program providing for the repurchase in open market and privately
negotiated transactions of up to an additional 1.5 million shares valid through
the end of the Company's 1999 fiscal year. The timing, prices and number of
shares repurchased under these programs will be determined at the discretion of
the Company's management and subject to continued compliance with the Company's
credit facilities. During the quarter ended July 4, 1998, the Company
repurchased 571,000 shares at a cost of $20.8 million. During the 26 weeks
ended July 4, 1998, the Company repurchased 1,006,000 shares at a cost of $35.4
million. As of July 4, 1998, the Company was authorized to repurchase 1,295,000
additional shares under these programs.
4. ACQUISITIONS
During January 1998, the Company acquired substantially all of the assets
of the independent sales representative organization that represented the
Company's products in California and several other western states. Also during
January 1998, the Company acquired the inventory and certain other assets of its
Canadian distributor. During May 1998, the Company acquired substantially all
of the assets of the independent sales representative organization that
represented the Company's products in New York and several other eastern states.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
COMPARISON OF RESULTS OF OPERATIONS FOR THE QUARTER ENDED JULY 4, 1998 TO THE
QUARTER ENDED JULY 5, 1997.
<TABLE>
<CAPTION>
Quarter Quarter
Ended Ended
July 4, 1998 July 5, 1997
-------------- --------------
(Dollars in millions)
% of % of
Dollars Net Sales Dollars Net Sales
------- ----------- ------- ----------
<S> <C> <C> <C> <C>
Net sales $69.9 100% $58.6 100%
Gross profit 41.2 59 33.9 58
Selling, general, and administrative expenses 13.7 20 11.4 19
Amortization of goodwill, trademarks and other 1.3 2 1.1 2
Recovery of import duties (0.1) - - -
Income from operations 26.3 38 21.3 36
Interest expense 1.0 1 1.1 2
Other income, net - - (0.3) (1)
Income before income taxes 25.4 36 20.5 35
Provision for income taxes 10.0 14 8.1 14
Net income 15.4 22 12.4 21
</TABLE>
NET SALES. Net sales increased $11.3 million, or 19%, from $58.6 million
in the second quarter of 1997 to $69.9 million in the second quarter of 1998.
Sales of the Company's Village Series products increased $9.0 million, or 23%,
while sales of General Giftware products increased $2.3 million, or 12% between
the two periods. Village Series and General Giftware products represented 68%
and 32%, respectively, of the Company's net sales during the second quarter of
1998.
<PAGE>
GROSS PROFIT. Gross profit increased $7.3 million, or 22%, between the
second quarter of 1997 and the second quarter of 1998. The increase in gross
profit was principally due to the increase in sales volume. Gross profit as a
percentage of net sales increased from 58% in the second quarter of 1997 to 59%
in the second quarter of 1998, principally due to a change in the mix of product
shipped during the second quarter of 1998 as compared to the second quarter of
1997 and the benefit derived from selling directly to the Canadian market.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses increased $2.3 million, or 20%, between the second
quarter of 1997 and the second quarter of 1998 principally due to a 124%
increase in marketing expenses and a 36% increase in distribution expenses.
Marketing expenses increased principally due to costs incurred in connection
with the new Snowbabies Friendship Club and a shift in the timing of certain
other marketing expenditures. Selling, general and administrative expenses as
a percentage of sales increased from approximately 19% in the second quarter
of 1997 to 20% in the second quarter of 1998.
INCOME FROM OPERATIONS. Income from operations increased $5.0 million, or
24%, between the second quarter of 1997 and the second quarter of 1998 due to
the factors described above. Income from operations increased from 36% to 38% of
net sales principally due to the increase in gross profit as a percentage of
sales.
INTEREST EXPENSE. Interest expense decreased $.1 million, or 11%, between
the second quarter of 1997 and the second quarter of 1998 principally due to the
payment of $20 million of long term debt during 1997 offset by increased
borrowings under the revolving line of credit in 1998.
PROVISION FOR INCOME TAXES. The effective tax rate was 39.5% during the
second quarter of both 1997 and 1998.
<PAGE>
RESULTS OF OPERATIONS
COMPARISON OF RESULTS OF OPERATIONS FOR THE 26 WEEKS ENDED JULY 4, 1998 TO THE
27 WEEKS ENDED JULY 5, 1997.
<TABLE>
<CAPTION>
26 Weeks 27 Weeks
Ended Ended
July 4, 1998 July 5, 1997
------------ -------------
(Dollars in millions)
% of % of
Dollars Net Sales Dollars Net Sales
--------- ----------- --------- ----------
<S> <C> <C> <C> <C>
Net sales $118.9 100% $104.3 100%
Gross profit 69.6 59 60.5 58
Selling, general, and administrative expenses 25.3 21 22.5 22
Amortization of goodwill, trademarks and other 2.4 2 2.3 2
Recovery of import duties (0.1) - (0.4) -
Income from operations 42.0 35 36.1 35
Interest expense 1.7 1 2.2 2
Other income, net (0.4) - (1.0) (1)
Income before income taxes 40.7 34 34.9 33
Provision for income taxes 16.1 14 13.8 13
Net income 24.6 21 21.1 20
</TABLE>
NET SALES. Net sales increased $14.6 million, or 14%, from $104.3 million
in 1997 to $118.9 million in 1998. Sales of the Company's Village Series
products increased $10.2 million, or 15%, while sales of General Giftware
products increased $4.4 million, or 13% between the two periods. Village Series
and General Giftware products represented 67% and 33%, respectively, of the
Company's net sales in 1998.
GROSS PROFIT. Gross profit increased $9.2 million, or 15%, between 1997
and 1998. The increase in gross profit was principally due to the increase in
sales volume. Gross profit as a percentage of net sales increased from 58% in
1997 to 59% in 1998 principally due to a change in the mix of product shipped
during 1998 as compared to 1997 and the benefit derived from selling directly to
the Canadian market.
<PAGE>
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses increased $2.8 million, or 12%, between 1997 and 1998
principally due to a 89% increase in marketing expenses and a 23% increase in
distribution expenses. Marketing expenses increased principally due to costs
incurred in connection with the new Snowbabies Friendship Club and a shift in
the timing of certain other marketing expenditures. Selling, general and
administrative expenses as a percentage of sales decreased from approximately
22% in 1997 to 21% in 1998.
INCOME FROM OPERATIONS. Income from operations increased $5.9 million, or
16%, between 1997 and 1998 due to the factors described above. Income from
operations was 35% of net sales in both 1997 and 1998.
INTEREST EXPENSE. Interest expense decreased $.4 million, or 20%, between
1997 and 1998 principally due to the payment of $20 million of long term debt
during 1997 offset by increased borrowings under the revolving line of credit in
1998.
PROVISION FOR INCOME TAXES. The effective tax rate was 39.5% in both 1997
and 1998.
LIQUIDITY AND CAPITAL RESOURCES
The principal sources of the Company's liquidity are its available cash
balances, internally generated cash flow and a revolving credit agreement which
provides letters of credit, bankers' acceptances and, if required, short-term
seasonal borrowings. The Company believes that these sources of liquidity will
be more than adequate to fund operations, capital expenditures and required
principal payments on its term loan for the next 12 months.
The Company maintains a revolving credit agreement providing for borrowings
of up to $90 million (subject to certain limitations) including letters of
credit and bankers' acceptances. At July 4, 1998, the Company had $37.0 million
of outstanding loans and acceptances and $5.3 million of outstanding letters of
credit under its revolving line of credit. The available revolving line of
credit commitment was $26.0 million.
Consistent with customary practice in the giftware industry, the Company
offers extended accounts receivable terms to many of its customers. This
practice has typically created significant working capital requirements in the
second and third quarters that the Company has generally financed with net cash
balances, internally generated cash flow and seasonal borrowings. The Company's
net cash balances peak in December, following the collection of accounts
receivable with extended payment terms. Accounts receivable increased $10.3
million from $73.2 million at July 5, 1997 to $83.5 million at July 4, 1998
principally due to the increase in sales in 1998 as compared to 1997.
On April 29, 1998, the Board of Directors of the Company authorized a
stock repurchase program providing for the repurchase in open market and
privately negotiated transactions of up to an additional 1.5 million shares
valid through the end of the Company's 1999 fiscal year. The timing, prices and
number of shares repurchased under these programs will be determined at the
discretion of the Company's management and subject to continued compliance with
the Company's credit facilities. During the quarter ended July 4, 1998, the
Company repurchased 571,000 shares at a cost of $20.8 million. During the 26
weeks ended July 4, 1998, the Company repurchased 1,006,000 shares at a cost of
$35.4 million. As of July 4, 1998, the Company was authorized to repurchase
1,295,000 additional shares under these programs.
<PAGE>
FOREIGN EXCHANGE
The dollar value of the Company's assets abroad is not significant. The
Company's sales are denominated in United States dollars and, as a result, are
not subject to changes in exchange rates.
The Company imports most of its products from manufacturers located in the
Pacific Rim, primarily The People's Republic of China, Taiwan (Republic of
China) and The Philippines. These transactions are principally denominated in
U.S. dollars, except for imports from Taiwan which are principally denominated
in New Taiwan dollars. The Company, from time to time, will enter into foreign
exchange contracts or build currency deposits as a partial hedge against
currency fluctuations. The Company intends to manage foreign exchange risks to
the extent possible and take appropriate action where warranted. The Company's
costs could be adversely affected if the currencies of the countries in which
the manufacturers operate appreciate significantly relative to the U.S. dollar.
EFFECT OF INFLATION
The Company continually attempts to minimize any effect of inflation on
earnings by controlling its operating costs and selling prices. During the past
few years, the rate of inflation has not had a material impact on the Company's
results of operations.
<PAGE>
SEASONALITY AND CUSTOMER ORDERS
The Company generally records its highest level of sales during the second
and third quarters as retailers stock merchandise in anticipation of the holiday
season. The Company can also experience fluctuations in quarterly sales and
related net income compared with the prior year due to timing of receipt of
product from suppliers and subsequent shipment of product from the Company to
customers.
CUSTOMER ORDERS ENTERED (1)
(IN MILLIONS)
<TABLE>
<CAPTION>
1st 2nd 3rd 4th
Qtr Qtr Qtr Qtr Total
----- ----- ----- ------ ------
<S> <C> <C> <C> <C> <C>
1996 $178 $35 $28 $8 $249
1997 161 44 34 6 245
1998 174 50 - - -
</TABLE>
(1) Customer orders entered are orders received and approved by the
Company, subject to cancellation for various reasons, including credit
considerations, inventory shortages and customer requests.
Historically, principally due to the timing of trade shows early in the
calendar year and the limited supply of the Company's products, the Company has
received the majority of its orders in the first quarter of each year. The
Company entered 66% and 71% of its total annual customer orders during the first
quarter of both 1997 and 1996, respectively. Cancellations were approximately
8% and 6% of total annual orders in 1997 and 1996, respectively.
The Company shipped and recorded as net sales approximately 90% and 92% of
its annual customer orders in 1997 and 1996, respectively. Orders not shipped
in a particular period, net of cancellations, returns, allowances and cash
discounts, are carried into backlog. The backlog was $101.3 million as of July
4, 1998, as compared to $99.1 million as of July 5, 1997.
Through the second quarter of 1998, customer orders entered increased 9% as
compared to the same period for 1997. Customer orders entered for Village
Series products have increased 10% through the second quarter of 1998 while
customer orders entered for General Giftware products have increased 9%.
Certain General Giftware products have lower gross profit rates than the
Company's average gross profit rate. In addition, from time to time, the
Company liquidates product at lower than average gross profit rates. As a
result, gross profit may vary depending on the mix of product shipped.
<PAGE>
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
At the Company's Annual Meeting of Stockholders held on May 14, 1998 (the
"Annual Meeting"), all of the persons named in the Company's proxy materials as
management nominees for the Board of Directors were elected. All but one of the
nominees were incumbent directors and the election of all nominees at the Annual
Meeting was uncontested. Also at the Annual Meeting, the Company's stockholders
ratified the appointment by the Board of Directors of Deloitte & Touche LLP,
independent public accountants, as auditors for the Company for the fiscal year
ending January 2, 1999 as follows: 16,989,611 voting for ratification; 6,949
voting against; 9,461 abstentions; 2,143,139 not voting.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) 11.1 Computation of net income per share.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DEPARTMENT 56, INC.
Date: July 30, 1998 /s/Susan E. Engel
-------------------
Susan E. Engel
Chairwoman, Chief Executive Officer and Director
Date: July 30, 1998 /s/Timothy J. Schugel
----------------------
Timothy J. Schugel
Vice President - Finance and Principal Accounting
Officer
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT EXHIBIT PAGE
NUMBER NAME NUMBER
------ ---- ------
<S> <C> <C>
11.1 Computation of net income per share.
27.1 Financial Data Schedule
</TABLE>
<PAGE>
Exhibit 11.1
DEPARTMENT 56, INC.
COMPUTATION OF NET INCOME PER SHARE
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Quarter Quarter
Ended Ended
July 4, July 5,
1998 1997
-------- --------
<S> <C> <C>
BASIC:
Net Income $15,369 $12,399
------- -------
------- -------
Weighted average number of common shares outstanding 18,962 20,814
Net Income per Common Share $ 0.81 $ 0.60
------- -------
------- -------
ASSUMING DILUTION:
Net Income $15,369 $12,399
------- -------
------- -------
Weighted average number of common shares outstanding 18,962 20,814
The number of shares resulting from the assumed
exercise of stock options reduced by the number
of shares which could have been purchased with
the proceeds from such exercise, using the average
market price during the period 336 114
------- -------
Weighted average number of common and
common equivalent shares 19,298 20,928
------- -------
------- -------
Net Income per Common Share Assuming Dilution $ 0.80 $ 0.59
------- -------
------- -------
</TABLE>
<PAGE>
DEPARTMENT 56, INC.
COMPUTATION OF NET INCOME PER SHARE
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
26 Weeks 27 Weeks
Ended Ended
July 4, July 5,
1998 1997
---------- ----------
<S> <C> <C>
BASIC:
Net Income $24,609 $21,122
------- -------
------- -------
Weighted average number of common shares outstanding 19,186 21,120
Net Income per Common Share $ 1.28 $ 1.00
------- -------
------- -------
ASSUMING DILUTION:
Net Income $24,609 $21,122
------- -------
------- -------
Weighted average number of common shares outstanding 19,186 21,120
The number of shares resulting from the assumed
exercise of stock options reduced by the number
of shares which could have been purchased with
the proceeds from such exercise, using the average
market price during the period 311 129
------- -------
Weighted average number of common and
common equivalent shares 19,497 21,249
------- -------
------- -------
Net Income per Common Share Assuming Dilution $ 1.26 $ 0.99
------- -------
------- -------
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-02-1999
<PERIOD-END> JUL-04-1998
<CASH> 1,492
<SECURITIES> 0
<RECEIVABLES> 83,493
<ALLOWANCES> 0
<INVENTORY> 23,608
<CURRENT-ASSETS> 119,326
<PP&E> 13,836
<DEPRECIATION> 0
<TOTAL-ASSETS> 292,809
<CURRENT-LIABILITIES> 87,718
<BONDS> 20,000
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 292,809
<SALES> 118,947
<TOTAL-REVENUES> 118,947
<CGS> 49,304
<TOTAL-COSTS> 49,304
<OTHER-EXPENSES> 27,644
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,741
<INCOME-PRETAX> 40,676
<INCOME-TAX> 16,067
<INCOME-CONTINUING> 24,609
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,609
<EPS-PRIMARY> 1.28
<EPS-DILUTED> 1.26
</TABLE>
