<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 0-26772
VISIO CORPORATION
(Exact name of registrant as specified in its charter)
WASHINGTON 91-1448389
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
520 PIKE STREET, SUITE 1800, SEATTLE, WASHINGTON 98101-4001
(Address of principal executive offices) (Zip code)
(206) 521-4500
(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
--- ---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:
Class Shares outstanding as of January 31, 1997
- ---------------------------- -----------------------------------------
Common Stock ($.01 par value) 13,831,470
================================================================================
<PAGE>
VISIO CORPORATION
FORM 10-Q
FOR THE QUARTER ENDED DECEMBER 31, 1996
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
<TABLE>
<CAPTION>
PAGE
----
ITEM 1. FINANCIAL STATEMENTS
<S> <C>
Balance Sheets as of December 31, 1996 and September 30, 1996.................... 3
Statements of Income for the three months ended December 31, 1996 and 1995....... 4
Statements of Cash Flows for the three months ended December 31, 1996 and 1995... 5
Notes to Financial Statements.................................................... 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.............................................. 7
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K................................................. 14
SIGNATURES............................................................................... 15
</TABLE>
2
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
VISIO CORPORATION
BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1996 1996
------------ -------------
(Unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash and short-term investments $67,261 $61,107
Accounts receivable 3,271 2,242
Inventories 680 604
Prepaid expenses 2,231 2,431
Defferred income taxes 2,296 1,779
------- -------
Total current assets 75,739 68,163
Equipment and leasehold improvements 3,582 3,445
------- -------
Total assets $79,321 $71,608
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 3,213 $ 3,525
Accrued compensation and benefits 1,908 2,002
Other accrued liabilities 9,870 8,798
Income taxes payable 2,323 1,584
Current portion of long-term Obligations 277 326
------- -------
Total current liabilities 17,591 16,235
Long-term obligations 112 148
Shareholders' equity:
Common stock 47,643 45,688
Retained earnings 13,975 9,537
------- -------
Total shareholders' equity 61,618 55,225
------- -------
Total liabilities and shareholders'
equity $79,321 $71,608
======= =======
</TABLE>
See accompanying notes.
3
<PAGE>
VISIO CORPORATION
STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
------------------
1996 1995
-------- ------
<S> <C> <C>
Revenues $19,010 $13,417
Cost of revenues 1,977 2,345
------- -------
Gross profit 17,033 11,072
Operating expenses:
Research and development 2,705 1,664
Sales and marketing 7,490 5,547
General and administrative 1,366 1,039
------- -------
Total operating expenses 11,561 8,250
------- -------
Operating income 5,472 2,822
Interest and other income, net 452 281
------- -------
Income before income taxes 5,924 3,103
Provision for income taxes 1,540 1,024
------- -------
Net income $ 4,384 $ 2,079
======= =======
Earnings per share $0.29 $0.15
======= =======
Shares used in computation of earnings
per share 15,068 13,548
======= =======
</TABLE>
See accompanying notes.
4
<PAGE>
VISIO CORPORATION
STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
------------------
1996 1995
------ ------
<S> <C> <C>
CASH FLOWS FROM OPERATIONS:
Net income $ 4,384 $ 2,079
Adjustments to reconcile net income
to net cash from operations:
Depreciation and amortization 499 248
Deferred income taxes (517) 158
Changes:
Accounts receivable (1,047) 2,820
Inventories (75) 331
Prepaid expenses 222 (125)
Other assets -- 179
Accounts payable (294) (1,301)
Accrued compensation and benefits (96) 338
Other accrued expenses 1,088 2,809
Income taxes payable 2,073 (842)
------- -------
Net cash from operations 6,237 6,694
------- -------
CASH FLOWS USED FOR INVESTMENTS:
Purchases of equipment and leasehold
improvements (608) (375)
------- -------
CASH FLOWS FROM FINANCING:
Issuance of common stock 618 --
Proceeds from initial public offering -- 35,680
Payments on long-term obligations (85) (84)
------ ------
Net cash from financing 533 35,596
------ ------
Net increase in cash and cash equivalents 6,162 41,915
Effect of exchange rate changes on cash 53 --
Cash and cash equivalents, beginning 42,506 7,063
------- -------
Cash and cash equivalents, ending 48,721 48,978
Short-term investments 18,540 --
------- -------
Cash and short-term investments $67,261 $48,978
======= =======
</TABLE>
See accompanying notes.
5
<PAGE>
VISIO CORPORATION
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The consolidated financial statements of Visio Corporation ("Visio" or the
"Company") at December 31, 1996 and for the three-month periods ended December
31, 1996 and 1995 are unaudited and reflect all adjustments, consisting only of
normal recurring items, which are, in the opinion of management, necessary for a
fair presentation of the financial position and results of operations for the
interim periods. The consolidated financial statements should be read in
conjunction with the consolidated financial statements and notes thereto for the
fiscal year ended September 30, 1996 included in Visio's Annual Report on Form
10-K. The results of operations for the three months ended December 31, 1996
are not necessarily indicative of the results to be expected for the full fiscal
year.
Visio's fiscal year is a 52/53-week period. Accordingly, all references as
of and for the periods ended December 31, 1996, September 30, 1996 and December
31, 1995 reflect amounts as of and for the periods ended December 27, 1996,
September 27, 1996 and December 29, 1995, respectively.
Inventories
Inventories are stated at the lower of cost or market and consist of the
following:
<TABLE>
<CAPTION>
December 31, September 30,
1996 1996
------------ -------------
(in thousands)
<S> <C> <C>
Raw Materials $ 324 $ 189
Finished Goods 356 415
----- -----
$ 680 $ 604
===== =====
</TABLE>
Initial Public Offering
On November 15, 1995, the Company completed its initial public offering of
2,840,500 shares of common stock, par value $.01 per share (the "Common Stock"),
at $16 per share. Of these shares, 370,000 were sold by selling shareholders.
Proceeds to the Company were $35,679,879 net of $1,081,161 of related expenses.
The Company's 5,205,089 shares of convertible redeemable preferred stock were
automatically converted into 5,205,089 shares of common stock on the closing
date of the offering.
6
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
Visio, which commenced operations in September 1990, is a leading supplier of
drawing and diagramming software for the general business personal computer
user. All of the Company's products have been developed for the Microsoft
Windows 3.1, Windows 95 and Windows NT operating systems and are marketed under
the Visio(R) brand. The Company's primary products are Visio, Visio Technical
and Visio Professional. The Company's first product Visio, first shipped in
November 1992, enables business and technical users to create drawings and
diagrams using a "drag and drop" approach. The Company shipped its second
significant product line, Visio Technical, for technical drawing in December
1994. The Company introduced its third significant product, Visio Professional,
in December 1996. Visio Professional, which shipped in the beginning of the
second quarter of fiscal 1997, provides functionality specifically for
information systems and business process design.
Visio classifies its revenues in four channels: "Distribution," "Direct,"
"Volume Licensing," and "OEM." Distribution revenues represent sales of packaged
products through national distributors and corporate, retail and mail order
resellers. Direct revenues represent sales of packaged products directly by the
Company, including upgrades, generally to end users responding to advertising or
other marketing promotions. Volume Licensing revenues are derived from volume
licenses, which are generally administered through corporate resellers after the
Company's sales staff has negotiated the sale. The typical sales cycle for a
volume license is six to eighteen months. Volume Licensing revenues usually do
not include any significant amount of packaged goods, but do include maintenance
and support revenues, which are priced separately and recognized over the lives
of the contracts. Volume Licensing revenues characteristically have higher gross
profit as a percentage of revenues, but lower operating profit as a percentage
of revenues, due to costs of supporting the related sales staff. OEM revenues
include licenses of Visio products to hardware and software manufacturers for
bundling arrangements. OEM revenues include packaged product sales, as well as
royalty payments with no associated product costs.
The distribution channel commonly stocks and displays packaged products to
achieve in-store visibility and timely delivery to customers. Fluctuations in
distributor inventory levels can affect the Company's revenues. Distributor
inventory levels may fluctuate for a variety of reasons, including the inability
of distributors to sell a product at the levels purchased, as well as the
phenomena called "channel dry" and "channel fill." Channel dry occurs prior to
the release of an upgrade version of an existing product as the distribution
channel reduces the inventory levels to minimize product returns. Channel fill
occurs following the introduction of a new product or new version of a product,
in anticipation of price increases, in response to planned end-user promotions
and in connection with purchases of additional display space. The Company defers
the recognition of revenues from distributor inventory that it estimates to be
in excess of levels appropriate for the channel. Nonetheless, the effects of
channel fill could add substantial volatility to the Company's revenues.
The Company has invested heavily in the development of its core graphics
technology, new product introductions, Visio brand awareness and its worldwide
infrastructure. These investments are part of the Company's strategy for growth
and are consistent with its mission to become the single standard for creating,
storing and exchanging drawings and diagrams in business. Although the Company
believes that these investments have established a foundation for the worldwide
expansion of its business, they have also significantly affected the Company's
historical profitability. There can be no assurance that the Company's revenue
growth will be sufficient in future periods to maintain its recent profitability
as the Company continues to make such investments.
- - - - - - - - - - - -
VISIO is a registered trademark of Visio Corporation.
7
<PAGE>
When used in this discussion, the words "expects," "believes,"
"anticipates" and similar expressions are intended to identify forward-looking
statements. Such statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those projected. Factors
which could affect the Company's financial results and cause such results to
differ materially from quarter to quarter include but are not limited to
fluctuations in quarterly performance, dependence on other products, including
Microsoft Windows, competition in the business drawing and diagramming software
market, timing and customer acceptance of new products, the Company's ability to
manage growth, potential change in licensing and marketing methods and changes
in general economic conditions. Additional information concerning these and
other risks is described in the "Certain Risk Factors that may Impact Future
Results of Operations" section of the Company's Form 10-K for the fiscal year
ended September 30, 1996, and, from time to time, in the Company's Securities
and Exchange Commission reports. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date
hereof. The Company undertakes no obligation to publicly release the result of
any revisions to these forward-looking statements that may be made to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
8
<PAGE>
RESULTS OF OPERATIONS
The following table sets forth statement of income data as a percentage of
revenues for the fiscal periods indicated.
<TABLE>
<CAPTION>
Three Months Ended
December 31,
------------------
1996 1995
---- ----
<S> <C> <C>
Revenues....................... 100.0% 100.0%
Cost of revenues............... 10.4 17.5
----- -----
Gross margin................... 89.6 82.5
Operating expenses:
Research and development..... 14.2 12.4
Sales and marketing.......... 39.4 41.4
General and administrative... 7.2 7.7
----- -----
Total operating expenses....... 60.8 61.5
----- -----
Income from operations......... 28.8 21.0
Other income, net.............. 2.4 2.1
----- -----
Income before income taxes..... 31.2 23.1
Provision for income taxes..... 8.1 7.6
----- -----
Net income..................... 23.1% 15.5%
===== =====
</TABLE>
REVENUES
The following tables set forth revenues by product group with the
corresponding percentage of total revenues and the year-to-year percentage
change for the fiscal periods indicated.
<TABLE>
<CAPTION>
Three Months Ended December 31,
-------------------------------------------------
1996 1995 Change
------------------ ---------------- ---------
(dollars in thousands)
<S> <C> <C> <C> <C> <C>
Revenues:
Business diagramming... $11,680 61.4% $ 9,775 72.8% 19.5%
Technical drawing...... 7,288 38.4 3,287 24.5 121.7%
Other.................. 42 0.2 355 2.7 (88.2)%
------- ----- ------- -----
Total revenues..... $19,010 100.0% $13,417 100.0% 41.7%
======= ===== ======= =====
</TABLE>
Revenues include sales of software products, maintenance and support
contracts and licenses, net of reserves for estimated future returns and
allowances. Revenues from the sale of maintenance and support contracts have not
been material to date. License revenues are derived from volume licenses,
international royalties and certain OEM arrangements.
Revenues for the first quarter of fiscal 1997 increased 42% over the same
quarter in the prior year. The increase in revenues was due primarily to sales
volume growth across product groups, distribution channels with the exception of
the Direct channel and geographic regions and secondarily to price increases.
9
<PAGE>
Percentage growth within the product groups was most significant for the
technical drawing product group, which grew 122% for the three month period
ended December 31, 1996 over the comparable period in fiscal 1996. This growth
was primarily from Europe and Japan, where localized language versions of Visio
Technical were released subsequent to the December 31, 1995 quarter, and from
continued growth domestically. The growth in the business diagramming product
group of 19% was relatively lower due to the effect of the Visio 4.0 upgrade on
the comparable quarters. Business diagramming upgrade revenues were $0.6 million
and $2.1 million in the quarters ended December 31, 1996 and 1995, respectively.
Visio 4.0, which was released in August 1995, was at the beginning of its
upgrade cycle in the quarter ended December 31, 1995, when demand for upgrades
is typically at its peak, but was nearing the end of its upgrade cycle in the
quarter ended December 31, 1996. Business diagramming revenues excluding
upgrades were $11.1 million and $7.7 million in the quarters ended December 31,
1996 and 1995, respectively. Other revenues consisted primarily of sales of
Visio Home and related Visio Shapes products, which represented a decreasing
percentage of total revenues due to the Company's focus on business personal
computer users.
In the channels, the mix of Distribution, Direct, Volume Licensing and OEM
revenues for the quarter ended December 31, 1996 was 73%, 8%, 18% and 1%,
respectively, compared to 73%, 16%, 8% and 3%, respectively, for the same
quarter in the prior year. Percentage growth was most significant for the Volume
Licensing channel, which grew 222% for the three month period ended December 31,
1996 over the comparable period in fiscal 1996. This growth was primarily the
result of continued infrastructure investment in the volume licensing program.
Direct revenues as a percentage of total revenues were significantly higher in
the quarter ended December 31, 1995 on the strength of the Visio 4.0 upgrade.
Revenues in the United States and Canada increased 23% to $11.0 million in
the first quarter of fiscal 1997 from $8.9 million in the prior-year period. The
increase in revenues primarily reflected the contribution of Visio Technical.
International revenues increased 80% to $8.0 million in the first quarter of
fiscal 1997 from $4.5 million in the prior-year period. Japan contributed
significantly to this growth with the initial release of a Kanji version of
Visio Technical in October 1996. For the quarter ended December 31, 1996 and
1995, international revenues represented 42% and 33% of total revenues,
respectively.
The Company introduced Visio Professional in December 1996 and intends to
introduce upgraded versions of Visio, Visio Technical and Visio Professional
during fiscal 1997, and, as a result, expects its revenues to increase. There
can be no assurance, however, that this growth will occur or that any growth
will be sufficient to offset the Company's continuing investment in new products
and international markets.
10
<PAGE>
Cost of Revenues
The following table sets forth cost of revenues with the corresponding
percentage of revenues and year-to-year percentage change for the fiscal periods
indicated.
<TABLE>
<CAPTION>
Three Months Ended December 31,
--------------------------------------------
1996 1995 Change
---------------- -------------- --------
(dollars in thousands)
<S> <C> <C> <C> <C>
$1,977 10.4% $2,345 17.5% (15.7%)
</TABLE>
Cost of revenues varies with the mix of Distribution, Direct, Volume
Licensing and OEM revenues, due to relative variations in the standard costs
associated with each revenue category, and with fluctuations in period costs.
Standard costs consist primarily of documentation, packaging, media duplication,
assembly and material management costs. Period costs consist primarily of
technical support, production management, freight and fulfillment, certain
royalties, standard material variances and inventory valuation adjustments.
Standard costs associated with each revenue category are primarily
determined by the amount of packaged product delivered in that revenue category.
Accordingly, most of the Company's standard costs are associated with
Distribution and Direct revenues, all of which are derived from sales of
packaged products. Volume Licensing revenues have the lowest standard cost
because they generally do not include any significant amount of packaged goods.
Standard costs decreased in absolute terms even though combined
Distribution and Direct revenues, which generate most of the Company's standard
costs, increased 28%. This is due to the increased use of lower cost CD-ROM
media and other reduced production costs. Secondly, the quarter ended December
31, 1996 had lower period costs than the quarter ended December 31, 1995,
because of an inventory write-off of approximately $288,000 related to the
Company's "5 for 95" promotion in the quarter ended December 31, 1995. Other
factors which contributed to the decrease in cost of revenues as a percentage of
revenues for the first quarter of fiscal 1997 over the comparable period of
fiscal 1996 were increased Volume Licensing revenues which have little or no
standard costs and from an increase in the percentage of revenue from Visio
technical, which has a lower standard cost as a percentage of revenue than
Visio.
11
<PAGE>
RESEARCH AND DEVELOPMENT
The following table sets forth research and development expenses with the
corresponding percentage of revenues and year-to-year percentage change for the
fiscal periods indicated.
<TABLE>
<CAPTION>
Three Months Ended December 31,
-------------------------------------------
1996 1995 Change
---------------- -------------- ------
(dollars in thousands)
<S> <C> <C> <C> <C>
$2,705 14.2% $1,664 12.4% 62.6%
</TABLE>
Research and development expenses consist primarily of personnel, contract
services, occupancy and equipment costs required to conduct the Company's
Product development efforts. Product development includes product engineering,
documentation development, localization, usability testing, quality assurance
and advanced research and development costs. Contract localization costs and
lump sum payments for technology such as file converters are capitalized and
amortized to development over the lesser of the useful life or 12 months.
Research and development expenses are charged to operations as incurred.
Generally accepted accounting principles requiring capitalization of certain
software development costs subsequent to the establishment of technological
feasibility are not applicable because these costs have been immaterial.
Increases in research and development expenses for the quarter ended
December 31, 1996 over the quarter ended December 31, 1995 resulted primarily
from additions to the Company's development organization. Research and
development expenses increased as a percentage of revenues in the first fiscal
quarter of 1997 over the comparable quarter in fiscal 1996 primarily due to
expenses incurred with the development of Visio Professional 4.5 and Visio
Technical 4.5, which were released in December 1996 and January 1997,
respectively.
SALES AND MARKETING
The following table sets forth sales and marketing expenses with the
corresponding percentage of revenues and year-to-year percentage change for the
fiscal periods indicated.
<TABLE>
<CAPTION>
Three Months Ended December 31,
------------------------------------------
1996 1995 Change
---------------- -------------- ------
(dollars in thousands)
<S> <C> <C> <C> <C>
$7,490 39.4% $5,547 41.4% 35.0%
</TABLE>
Sales and marketing expenses, which include customer service expenses, have
increased in absolute terms as the Company continues building its worldwide
sales, marketing and customer service infrastructure. The increase in sales and
marketing expenses was due primarily to increased product marketing costs,
continued development of the domestic and international sales infrastructure and
the initiation of an internal solutions group to support customers and
developers. As a percentage of revenues, sales and marketing expenses in the
three months ended December 31, 1996 decreased compared to the corresponding
prior year's period, primarily due to increased revenues in fiscal 1997 as well
as the investment in sales and marketing in the fiscal 1996 period. This
investment consisted primarily of advertising associated with the recently
released Visio 4.0 and brand awareness activities including an advertising
campaign aimed at developing the Visio brand.
The Company believes substantial spending on marketing awareness and Volume
Licensing sales staffing is essential to achieve revenue growth and to maintain
and enhance the Company's competitive position. Visio expects continued
investment in marketing and sales of its products to further develop market
opportunities. Accordingly, the Company expects sales and marketing expenses to
increase in absolute terms over time. In addition, competitive pressures faced
by the Company may have an adverse effect on its business, financial condition
and results of operations.
12
<PAGE>
GENERAL AND ADMINISTRATIVE
The following table sets forth general and administrative expenses with the
corresponding percentage of revenues and year-to-year percentage change for the
fiscal periods indicated.
<TABLE>
<CAPTION>
Three Months Ended December 31,
-----------------------------------------
1996 1995 Change
--------------- ------------- ------
(dollars in thousands)
<S> <C> <C> <C> <C>
$1,366 7.2% $1,039 7.7% 31.5%
</TABLE>
General and administrative expenses increased in absolute terms in the
first quarter of fiscal 1997 primarily due to the cost of supporting the
Company's increased operations. The Company expects to show increased general
and administrative expenses in absolute terms in future periods for
infastructure to support revenue growth.
OTHER INCOME, NET
Other income for the first quarter of fiscal 1997 of $452,000 increased
61% over the first quarter of fiscal 1996. The increase was primarily due to
increased interest income because the Company had higher cash and short-term
investment balances in the fiscal 1997 period. This was partially offset by
foreign exchange losses incurred in the fiscal 1997 quarter. Other income
includes interest income net of interest expense, foreign currency transaction
gains and losses and grant income from the Industrial Development Agency of
Ireland tied to employment levels in the Company's Dublin operation. Visio does
not currently engage in hedging activities.
INCOME TAXES
The Company's effective income tax rate for the quarter ended December 31,
1996 was 26% which compared to an effective income tax rate of 33% for the
comparable prior year period. The lower effective tax rate for the December 31,
1996 quarter was primarily due to a greater percentage of income taxed in other
jurisdictions at rates lower than the U.S. rate.
LIQUIDITY AND CAPITAL RESOURCES
At December 31, 1996, the Company had cash and short-term investments
totaling $67.3 million, an increase of $6.2 million from September 30, 1996. The
increase in cash and short-term investments was due primarily to cash generated
from operations, the exercise of employee stock options and the income tax
benefits associated with those exercises. Since its inception, the Company has
financed its operations primarily through cash generated by its operations, as
well as through sales of its Common Stock and Preferred Stock and bank
financing. The Company has a $1.0 million unsecured bank line of credit, which
matures on February 28, 1997.
At December 31, 1996, the Company's principal commitments consisted
primarily of leases on its headquarters facilities. The Company's capital
expenditures totaled $0.6 million in the first quarter of fiscal 1997. At
December 31, 1996, the Company had no material commitments for capital
expenditures. The Company believes that its current cash balances, funds
available under its line of credit and cash flow from operations will be
sufficient to meet its working capital and capital expenditure requirements for
at least the next 12 months.
From time to time, the Company evaluates potential acquisitions of
businesses, products or technologies that Complement the Company's business. At
December 31, 1996, the Company had no material agreements or commitments with
respect to any such transaction.
13
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits required by Item 601 of Regulation S-K:
11.1 Computation of Earnings Per Share.
27.1 Financial Data Schedule which is submitted electronically to
the Securities and Exchange Commission for information purposes
only and not filed.
(b) Reports on Form 8-K:
None.
14
<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.
Date: February 10, 1997 VISIO CORPORATION
By: /s/ MARTY CHILBERG
-------------------------------
Marty Chilberg
Vice President, Finance and Operations;
Chief Financial Officer
(Principal Financial and Accounting
Officer and Duly Authorized Officer)
15
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION PAGE
- ----------- ----------- ----
<S> <C> <C>
11.1 Computation of Earnings Per Share. 17
27.1 Financial Data Schedule which is submitted
electronically to the Securities and Exchange
Commission for information purposes only
and not filed. 18
</TABLE>
16
<PAGE>
EXHIBIT 11.1
VISIO CORPORATION
COMPUTATION OF EARNINGS PER SHARE
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
------------------
1996 1995
-------- ------
<S> <C> <C>
Weighted average common shares outstanding 13,743 9,395
Net effect of dilutive stock options calculated using the treasury stock
method and the average stock price 1,224 1,387
Net effect of dilutive stock warrants calculated using the treasury stock
method and the average stock price 101 163
Weighted average common shares giving effect to the conversion of -- 2,603
convertible and redeemable preferred stock into common stock ------- -------
Total 15,068 13,548
======= =======
Net income $ 4,384 $ 2,079
======= =======
Earnings per share $ 0.29 $ 0.15
======= =======
</TABLE>
17
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 67,261
<SECURITIES> 0
<RECEIVABLES> 7,361
<ALLOWANCES> 4,090
<INVENTORY> 680
<CURRENT-ASSETS> 75,739
<PP&E> 6,992
<DEPRECIATION> 3,410
<TOTAL-ASSETS> 79,321
<CURRENT-LIABILITIES> 17,591
<BONDS> 0
0
0
<COMMON> 47,643
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 79,321
<SALES> 19,010
<TOTAL-REVENUES> 19,010
<CGS> 1,977
<TOTAL-COSTS> 1,977
<OTHER-EXPENSES> 11,561
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 11
<INCOME-PRETAX> 5,924
<INCOME-TAX> 1,540
<INCOME-CONTINUING> 4,384
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,384
<EPS-PRIMARY> $0.29
<EPS-DILUTED> $0.29
</TABLE>
