UNITED STATES
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 SEPTEMBER 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 Number: 000-26622
COMPUTER MANAGEMENT SCIENCES, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 59-2264633
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
8133 Baymeadows Way, Jacksonville, Florida 32256
(Address of principal executive offices) (zip code)
(904) 737-8955
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last
report)
-----------------------------------
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 October 31, 1997 there were 14,442,990 shares of the Registrant's common
stock, $0.01 par value, outstanding.
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Index to Form 10-Q
For the Quarter Ended September 30, 1997
Page
PART I - FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheets 3-4
Consolidated Statements of Operations 5
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 7-8
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations 9-11
Liquidity and Capital Resources 12
PART II - OTHER INFORMATION
Items 1-6 Other Information 13
Signatures 14
2
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Consolidated Balance Sheets
September 30, December 31,
1997 1996
(unaudited) (restated)
Current assets:
Cash and cash equivalents $ 11,733,165 14,201,624
Accounts receivable, net 11,328,914 9,375,005
Revenue earned in excess of billings 1,898,495 1,485,205
Investments 4,491,891 4,895,482
Other receivables 455,051 81,516
Notes receivable 264,014 465,250
Refundable income taxes 592,258 -
Other current assets 235,461 136,381
------------- ----------------
Total current assets 30,999,249 30,640,463
------------- ----------------
Property and equipment:
Land 2,562,000 2,107,000
Buildings and improvements 8,470,282 3,309,151
Computers and software 3,418,444 2,656,423
Office furniture and equipment 2,158,512 1,435,101
Vehicles 400,357 331,435
------------- ----------------
17,009,595 9,839,110
Less accumulated depreciation 2,840,017 2,248,972
------------- ----------------
Net property and equipment 14,169,578 7,590,138
Other assets:
Intangible assets, net of accumulated
amortization of $755,909 and $310,280 3,632,856 2,628,664
Land held for investment, at cost 424,065 424,065
Investments 6,282,478 5,542,369
Notes receivable, less current portion 889,267 1,135,092
Other 767,555 409,699
------------- ----------------
Total other assets 11,996,221 10,139,889
------------- ----------------
Total assets $ 57,165,048 48,370,490
============= ================
(continued)
3
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Consolidated Balance Sheets, continued
September 30, December 31,
1997 1996
(unaudited) (restated)
Liabilities and Shareholders' Equity
Current liabilities:
Notes payable $ - 864,411
Accounts payable 128,555 282,275
Accrued expenses 3,553,111 2,824,711
Unearned revenue 213,870 330,291
Income taxes payable - 312,249
Deferred income taxes 110,032 -
------------ ------------
Total current liabilities 4,005,568 4,613,937
------------ ------------
Long-term liabilities:
Notes payable 38,950 114,814
Deferred income taxes 254,250 385,774
------------ ------------
Total long term liabilities 293,200 500,588
------------- ------------
Shareholders' equity:
Common stock, $.01 par value; 40,000,000
shares authorized, 13,539,123 and
12,997,101 shares issued and outstanding
in 1997 and 1996 135,391 129,971
Preferred stock, $.01 par value; 5,000,000 shares
authorized, no shares issued and outstanding
in 1997 and 1996 - -
Paid-in capital 33,196,605 30,290,455
Retained earnings 19,378,571 12,785,285
Unrealized gain on investments, net of
income tax 155,713 50,254
------------ ------------
Total shareholders' equity 52,866,280 43,255,965
------------ ------------
Total liabilities and shareholders' equity $ 57,165,048 48,370,490
=============== ==============
See accompanying notes to consolidated financial statements.
4
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Consolidated Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
For the Three Month For the Nine Month
Period Ended September 30, Period Ended September 30,
1997 1996 1997 1996
(restated) (restated)
<S> <C> <C> <C> <C>
Revenue $ 18,160,441 14,544,472 51,934,107 41,439,316
Direct costs 11,022,348 9,029,239 31,756,016 25,481,047
------------- -------------- ------------- -------------
Gross profit 7,138,093 5,515,233 20,178,091 15,958,269
Selling, general and administrative
expenses 3,722,474 3,053,526 10,752,888 9,372,856
------------- -------------- ------------- -------------
Income from operations 3,415,619 2,461,707 9,425,203 6,585,413
Other income (expense):
Investment and other income 470,626 328,919 1,264,193 1,110,581
Interest expense (665) (26,537) (11,110) (92,369)
------------- -------------- ------------- -------------
469,961 302,382 1,253,083 1,018,212
------------- -------------- ------------- -------------
Income before income taxes 3,885,580 2,764,089 10,678,286 7,603,625
Provision for income taxes 1,465,000 1,283,889 4,085,000 3,062,889
------------- -------------- ------------- -------------
Net income $ 2,420,580 1,480,200 6,593,286 4,540,736
============= ============== ============= =============
Pro forma information (note 2):
Net income as reported $ 2,420,580 1,480,200 6,593,286 4,540,736
Pro forma charge (credit) in lieu of
income taxes - (246,876) - (114,207)
------------- -------------- ------------- -------------
Pro forma net income $ 2,420,580 1,727,076 6,593,286 4,654,943
============= ============== ============= =============
Pro forma net income per share $ .16 .11 .43 .31
============= ============== ============= =============
Weighted average number of common
and common equivalent shares
outstanding 15,232,018 15,052,838 15,181,042 14,997,262
See accompanying notes to consolidated financial statements.
</TABLE>
5
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
For The Nine Months
Ended September 30,
1997 1996
---- ----
(restated)
<S> <C> <C>
Cash flow from operating activities:
Net income $ 6,593,286 4,540,736
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 1,049,860 616,492
Net gain on disposition of property and equipment (70,386) (2,850)
Deferred income (benefit) tax (86,224) 124,108
Pooling adjustment to conform fiscal year-ends - 41,227
Change in assets and liabilities:
Increase in accounts and other receivables (2,740,734) (3,729,081)
(Increase) decrease in other current assets (113,392) 21,413
Increase in other assets (357,856) (837,820)
Increase in accounts payable and accrued expense 574,680 31,069
Decrease in unearned revenue (116,421) (354,621)
Increase in income taxes payable 1,609,578 119,210
-------------- -------------
Net cash provided by operating activities 6,342,391 569,883
------------- -------------
Cash flow from investing activities:
Purchases of property and equipment (7,230,541) (4,197,666)
Proceeds from the sale of property and equipment 117,435 2,850
Purchase of investments, net (166,327) (11,099,829)
Increase in intangible assets (1,450,000) (2,526,780)
Decrease (increase) in notes receivable 447,061 (103,127)
------------- -------------
Net cash used in investing activities (8,282,372) (17,924,552)
------------- -------------
Cash flow from financing activities:
Repayment of notes payable (940,275) (728,989)
Proceeds from issuance of common stock 411,797 212,846
------------- -------------
Net cash used in financing activities (528,478) (516,143)
------------- -------------
Net decrease in cash and cash equivalents (2,468,459) (17,870,812)
Cash and cash equivalents at beginning of period 14,201,624 30,081,665
------------- -------------
Cash and cash equivalents at end of period $ 11,733,165 12,210,853
============= =============
See accompanying notes to consolidated financial statements.
</TABLE>
6
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Notes to Consolidated Financial Statements
(1) Organization and Basis of Presentation
Computer Management Sciences, Inc. (the Company), provides computer
systems and information technology consulting, project management,
systems analysis and design, and programming services to a broad range of
industries and software/hardware platforms. The Company's services are
generally an outside resource supplementing a client's internal
information technology (IT) capabilities, and include various technical
services, such as technology support services, IT solutions services and
strategic IT consulting.
The interim financial information included herein is unaudited. Certain
information and footnote disclosures normally included in the financial
statements have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission (SEC), although the
Company believes that the disclosures made are adequate to make the
information presented not misleading. These financial statements should
be read in conjunction with the financial statements and related notes
contained in the Company's annual report on Form 10-K filed with the SEC
on March 31, 1997. Other than as indicated herein, there have been no
significant changes from the financial data published in that report. In
the opinion of management, such unaudited information reflects all
adjustments, consisting of normal recurring accruals and other
adjustments necessary for a fair presentation of the unaudited
information.
The results of operations for such interim periods are not necessarily
indicative of the results for the full year.
(2) Business Combinations
On January 17, 1997, the Company issued 584,080 shares of its common
stock in exchange for all of the outstanding common stock of Miaco
Corporation (Miaco), a computer consulting firm, based in Denver,
Colorado, specializing in relational database and client/server
technologies. Miaco also has an office in Washington, D.C. This business
combination was accounted for as a pooling-of-interests combination and,
accordingly, the Company's historical consolidated financial statements
have been restated to include the accounts and results of operations of
Miaco. Prior to its acquisition by the Company, Miaco's fiscal year ended
on March 31. Miaco's fiscal year end was conformed with the Company's
December 31 year end during 1996. Miaco will continue to operate as a
wholly-owned subsidiary of the Company.
On April 30, 1996, the Company issued approximately 945,907 shares
(adjusted for subsequent stock splits) of its common stock in exchange
for all of the outstanding common stock of Summit Computer Services, Inc.
(SCS), a Charlotte, North Carolina based computer consulting firm with
concentrated expertise in client/server technology. This business
combination has been accounted for as a pooling-of-interests and,
accordingly, the consolidated financial statements for all periods
presented have been restated to include the accounts and results of
operations of SCS. Prior to its acquisition by the Company, SCS had
elected S Corporation status for federal and state income tax purposes.
As an S Corporation, SCS's tax liability was the responsibility of its
stockholders. To reflect the earnings of SCS on an after tax basis, a pro
forma charge in lieu of income has been included, in the accompanying
consolidated statements of operations, for the periods preceding the
termination of S Corporation status.
7
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Notes to Consolidated Financial Statements, continued
(3) Newly Issued Accounting Pronouncement
During February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standard No. 128, (SFAS 128) "Earnings
Per Share". SFAS 128 governs the computation, presentation and disclosure
requirements for earnings per share (EPS) for entities with publicly held
common stock. SFAS 128 was issued to simplify the computation of EPS and
replaces the Primary and Fully diluted EPS calculations currently in use
with calculations of Basic and Diluted EPS. SFAS 128 is effective for
both interim and annual financial statements ending after December 15,
1997, and earlier application is not permitted. The Company will begin to
calculate EPS in compliance with SFAS 128 for the fourth quarter and year
ended December 31, 1997. After adoption, all prior period EPS data
presented will be restated to conform to SFAS 128. The Company does not
believe that the adoption of SFAS 128 will materially impact historical
or future EPS.
8
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
Forward Looking Statements
This Report on Form 10-Q may contain certain information and trend
statements that constitute "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act, which involve risks and
uncertainties. Actual results may differ materially from the results described
in the forward-looking statements. When used in this document, the words
"anticipate", "believe", "estimate", "expect", "intend", "project", "target" and
other similar expressions, as they relate to the Company, are intended to
identify forward-looking statements. Such statements reflect the current views
of the Company with respect to future events and are subject to certain risks,
uncertainties and assumptions that include, but are not limited to, growth
through business combinations and internal expansion, the Company's ability to
attract and retain qualified consultants, dependence on significant
relationships and the absence of long-term contracts, project risk, the
Company's ability to effectively manage a large and rapidly changing business,
pricing and margin pressures, and competition. Please refer to discussions of
these and other factors in this Report and other Company forms on file with the
Securities and Exchange Commission. The Company disclaims any intent or
obligation to update publicly these forward-looking statements, whether as a
result of new information, future events or otherwise.
The following discussion and analysis should be read in conjunction with,
and is qualified in its entirety by, the consolidated financial statements,
including the notes thereto, and the Company's 1996 Annual Report on Form 10-K
on file with the Securities and Exchange Commission. Historical events are not
necessarily indicative of trends in operating results for any future period.
Reference is also made to the above paragraph, with regard to the risks and
uncertainties associated with forward-looking statements.
Results of Operations
The information in the following table is presented as a percentage of
revenue for the period indicated:
<TABLE>
<CAPTION>
Percentage of Total Revenue
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenue 100.0% 100.0% 100.0% 100.0%
Direct Costs 60.7% 62.1% 61.1% 61.5%
Gross Profit 39.3% 37.9% 38.9% 38.5%
Selling, general, and administrative
expenses 20.5% 21.0% 20.7% 22.6%
Income from operations 18.8% 16.9% 18.1% 15.9%
Other income, net 2.6% 2.1% 2.4% 2.5%
Income before income taxes 21.4% 19.0% 20.6% 18.3%
Provision for income taxes 8.1% 8.8% 7.9% 7.4%
Net income 13.3% 10.2% 12.7% 11.0%
Pro forma net income 13.3% 11.9% 12.7% 11.2%
</TABLE>
9
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Management's Discussion and Analysis of Financial Condition and
Results of Operations, continued
Revenue:
Revenue for the third quarter ended September 30, 1997 was $18.2 million, a
25% increase over revenue of $14.5 million recorded in the third quarter of
1996. Revenue for the nine months ended September 30, 1997 increased $10.5
million to $51.9 million, reflecting a 25% improvement over the comparable
1996 period. Core consulting service revenue for the third quarter and year
to date 1997 increased 29% and 30% to $17.8 million and $50.5 million,
respectively, over the comparable 1996 periods. Core consulting service
revenue for the third quarter and year to date 1997 comprised greater than
97% of total revenue. The increase in revenue during the current quarter was
primarily attributable to an increase in volume of services which was
sustained by the growth in the average billable consultant headcount from
503 in the third quarter of 1996 to 600 for the current period, a 19%
increase. Also contributing to the increase in revenue was a slight change
in the mix of services delivered by the Company, which positively impacted
billing rates. During the later part of 1996 and continuing into 1997, the
number of strategic IT solution consulting and outsourcing/fixed bid
projects undertaken by the Company has steadily increased and positively
impacted average hourly billing rates. The success of the Company's Systems
Outsourcing Centers (SOCs) have contributed to this change in the mix of
services. Year to date, revenue has grown at a rate consistent with the
current quarter as result of increased consultant headcount and improved
billing rates as discussed above.
Gross Profit:
Gross profit in the third quarter of 1997 was $7.1 million, a $1.6 million
improvement over the third quarter of 1996. For the current nine month
period, gross profit increased 26% to $20.2 million compared to $16.0
million for the same period in 1996. Expressed as a percentage of revenue,
gross profit was 39.3% for the 1997 third quarter versus 37.9% for the 1996
second quarter. This increase in the gross profit percentage is primarily
due to increased fixed bid revenue, which generally results in the
realization of stronger margins when compared to time and material
engagements. Fixed bid revenue for the current quarter comprised 8.4% of
total revenue as compared to 6.5% in the third quarter of 1996. The change
in the mix of services delivered, as discussed above, resulted in an
increase in average hourly billing rates during the current quarter of
approximately 8% over the comparable 1996 quarter. Year to date, the gross
profit percentage is just slightly above that of the comparable period for
the prior year due to one less billing day year to date 1997. The increased
dollar amount, in both the current quarter and year to date, is attributable
to the increase in revenue.
S,G&A Expenses:
Selling, general and administrative expenses totaled $3.7 million for the
third quarter of 1997, an increase of $669 thousand over the third quarter
of 1996. Expressed as a percentage of revenue, however, S,G&A expenses
decreased from 21.0% in the third quarter 1996 to 20.5% for the third
quarter 1997. For the current nine month period, S,G&A expenses decreased as
a percentage of revenue to 20.7% from 22.6% for the comparable 1996 period.
The improved percentage, for both the current quarter and year to date,
resulted from increased volume and cost containment of marketing and other
fixed expenses. Management believes that this percentage will continue to
improve as the Company enters the fourth quarter of 1997 and the January
1997 merger with Miaco is fully assimilated.
10
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Management's Discussion and Analysis of Financial Condition and
Results of Operations, continued
Net Income and Pro Forma Net Income:
Net income increased 40.2% to $2.4 million for the third quarter of 1997,
compared to pro forma net income of $1.7 million for the third quarter of
1996. This translates into third quarter 1997 earnings per share of $0.16
versus $0.11 in 1996, a 39% increase. For the current nine month period, net
income was $6.6 million, an increase of $1.9 million over pro forma net
income for the comparable 1996 period. This improved performance for both
the third quarter and nine month period was a result of increased revenue,
improved billing rates and cost containment of S,G&A expenses. Also
contributing to the increase was a slight improvement in non-operating
revenue as a result of deploying the capital funds in higher yield
investments and an increase in certain lease income. For the third quarter
and nine month period of 1997, the effective tax rate was 37.7% and 38.3%,
respectively, versus 37.5% and 38.8% for the comparable 1996 periods (given
consideration to the pro forma adjustments). The pro forma tax adjustments
are due to the business combination with SCS, an S Corporation acquired by
the Company on April 30, 1996. The acquisition of SCS was accounted for as a
pooling-of-interests. As an S Corporation, SCS's tax liability was the
responsibility of its stockholders. To reflect the earnings of SCS on an
after tax basis, a pro forma charge in lieu of income taxes has been
included for the periods preceding the termination of S Corporation status.
On a comparable basis, pro forma net income expressed as a percentage of
revenue was 13.3% and 12.7% for the quarter and nine month period ended
September 30, 1997, respectively, versus 11.9% and 11.2% for the same
periods in 1996.
11
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Liquidity and Capital Resources
During the nine months ended September 30, 1997, cash decreased $2.5
million and working capital increased $967 thousand. While a number of
factors contributed to the decrease in cash, the main components were
increases in investments, accounts receivable, intangible assets and
property and equipment, as discussed below. The increase in working
capital is primarily due to current period income tax benefits resulting
from nonqualified stock option exercises as well as prepaid profit
sharing/ESOP contributions.
As of December 31, 1996, $12.8 million was invested in funds with
original maturity of ninety days or less and were classified as cash
equivalents, versus $6.6 million at September 30, 1997. In an effort to
increase the return on investments, the Company acquired investments with
maturities extending beyond ninety days during the current nine month
period. By the end of the third quarter, $4.5 million was invested in
current securities and $6.3 was invested in various corporate and
governmental bonds with maturities exceeding one year.
Accounts receivable increased $2.0 million during the first nine months
of 1997. The number days of sales outstanding as of September 30, 1997
was approximately 57 days compared to approximately 55 days of sales
outstanding at the end of 1996. Therefore, the increase in accounts
receivable is primarily a reflection of increased sales volume
experienced during the period.
During the current nine month period, the Company spent approximately
$7.2 million for capital expenditures. Of these capital expenditures,
$5.6 million was spent for property, buildings and improvements to house
the Greenville, Denver and Charlotte SOCs, and $1.5 million was spent for
computer equipment, software and furniture for the Tallahassee,
Greenville and Charlotte SOCs.
The Company maintains a $4 million line of credit with a commercial bank.
The line of credit is unsecured (but with a negative pledge on Company
assets) and is contingent on meeting certain financial covenants measured
on a quarterly basis. The Company is currently in compliance with such
covenants and management expects that the Company will continue to meet
such covenants in future periods. The credit facility has been inactive
during 1997. The Company assumed certain debt obligations totaling $940
thousand in connection with its January 1997 merger with Miaco, which
were paid off during the first quarter of 1997.
The Company currently anticipates that its existing cash and operating
cash flow are sufficient to meet both the Company's short and long-term
working capital requirements and to fund its expansion through the
establishment of additional branch offices, SOC locations, and possible
acquisitions.
12
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
Part II - Other Information
Item 1 - Legal Proceedings - None
Item 2 - Changes in Securities and Use of Proceeds:
(a) Changes in Securities - None
(b) Use of Proceeds -
In accordance with the provision of Rule 463 (17 CFR 230.463), the
following is a report of the use of proceeds from the Company's initial
public offering on September 27, 1995:
(1) The effective date of the Securities Act registration statement on
Form S-1 was September 27, 1995, Commission file number 33-95544.
(2) The offering commenced on September 29, 1995.
(3) Not applicable.
(4) (i) Not applicable.
(ii) The managing underwriters for the offering were The
Robinson-Humphrey Company, Inc. and Raymond James & Associates,
Inc.
(iii) The class of stock registered by the Company was Common
Stock, par value $0.01 per share.
(iv) The Company registered and sold 2,185,000 shares of Common
Stock at an aggregate offering price of $30,590,000.
(v) The actual direct or indirect payments to others in connection
with the issuance and distribution for the securities registered
was as follows:
Underwriters discounts and commissions - $2,141,300
Other expenses - 457,626
----------
Total expenses - $2,598,926
==========
(vi) The net offering proceeds to the Company after deducting the
total expenses in (4)(v) above was $27,991,074.
(vii) From the effective date of the registration statement
through September 30, 1997, the Company used the net proceeds from
the offering for (all of which were direct payments to others):
<TABLE>
<S> <C>
Construction of plant, building and facilities $1,502,030
Purchase and installation of machinery and equipment 2,729,179
Purchases of real estate 8,406,650
Acquisition of other businesses 4,739,192
Repayment of indebtedness 1,030,467
Short term investment securities 9,583,556
-----------
$27,991,074
===========
(viii) Not applicable.
</TABLE>
Item 3 - Defaults Upon Senior Securities - None
Item 4 - Submission of Matter to a Vote of Security Holders - None
Item 5 - Other Information - None
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits -
Exhibit 27 - Financial Data Schedule as of and for the nine months
ended September 30, 1997, pursuant to Article 5 of Regulation S-X.
(b) Reports: None
13
<PAGE>
COMPUTER MANAGEMENT SCIENCES, INC.
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.
COMPUTER MANAGEMENT SCIENCES, INC.
(Registrant)
Date: November 13, 1997 /s/ Anthony Colaluca
--------------------
Anthony Colaluca
Vice President and Chief Financial Officer
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE COMPUTER
MANAGEMENT SCIENCES, INC. CONSOLIDATED BALANCE SHEET AND CONSOLIDATED STATEMENT
OF OPERATIONS AS OF AND FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1997 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 11,733,165
<SECURITIES> 4,491,891
<RECEIVABLES> 11,328,914
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 30,999,249
<PP&E> 17,009,595
<DEPRECIATION> 2,840,017
<TOTAL-ASSETS> 57,165,048
<CURRENT-LIABILITIES> 4,005,568
<BONDS> 0
0
0
<COMMON> 135,391
<OTHER-SE> 52,730,889
<TOTAL-LIABILITY-AND-EQUITY> 57,165,048
<SALES> 51,934,107
<TOTAL-REVENUES> 51,934,107
<CGS> 31,756,016
<TOTAL-COSTS> 31,756,016
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 11,110
<INCOME-PRETAX> 10,678,286
<INCOME-TAX> 4,085,000
<INCOME-CONTINUING> 6,593,286
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,593,286
<EPS-PRIMARY> 0.43
<EPS-DILUTED> 0.43
</TABLE>
