-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GSagGKNmnj3jGdbMUA1H+ERoAFkQY2v3aOKPVMLimYTFQS7DUv8lxAWkFLCe9c0k dWL7kfDy/AFDU2652Q3dzQ== /in/edgar/work/0001016843-00-000841/0001016843-00-000841.txt : 20001114 0001016843-00-000841.hdr.sgml : 20001114 ACCESSION NUMBER: 0001016843-00-000841 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMRGLOBAL CORP CENTRAL INDEX KEY: 0001021772 STANDARD INDUSTRIAL CLASSIFICATION: [7371 ] IRS NUMBER: 592911475 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-28840 FILM NUMBER: 762042 BUSINESS ADDRESS: STREET 1: 100 SOUTH MISSOURI AVENUE CITY: CLEARWATER STATE: FL ZIP: 33756 BUSINESS PHONE: 7274678000 MAIL ADDRESS: STREET 1: 100 SOUTH MISSOURI AVENUE CITY: CLEARWATER STATE: FL ZIP: 33756 FORMER COMPANY: FORMER CONFORMED NAME: INFORMATION MANAGEMENT RESOURCES INC DATE OF NAME CHANGE: 19960828 10-Q 1 0001.txt ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 -------------- FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000 Commission File Number 0-28840 IMRGLOBAL CORP. ------------------------------------------------------ (Exact name of Registrant as specified in its charter) FLORIDA 59-2911475 - ------------------------------- ------------------------------------ (State or Other Jurisdiction of (I.R.S. Employer Identification No.) Incorporation or Organization) 100 SOUTH MISSOURI AVENUE, CLEARWATER, FLORIDA 33756 ---------------------------------------------------- (Address of principal executive offices and zip code) 727-467-8000 ---------------------------------------------------- (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 November 3, 2000, there were 41,118,230 outstanding shares of the Registrant's Common Stock, par value $.10 per share. IMRGLOBAL CORP. TABLE OF CONTENTS ----------------- PART I - FINANCIAL INFORMATION ------------------------------ PAGE ---- ITEM 1. Consolidated Balance Sheets as of December 31, 1999 and September 30, 2000............... 3 Consolidated Statements of Operations for the Three Months and Nine Months Ended September 30, 1999 and 2000.................................. 4 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 1999 and 2000........ 5 Notes to Consolidated Financial Statements................... 6 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.......................... 15 ITEM 3. Quantitative and Qualitative Disclosures about Market Risk... 23 PART II - OTHER INFORMATION --------------------------- ITEM 1. Legal Proceedings............................................ 24 ITEM 2. Changes in Securities........................................ 24 ITEM 5. Other Information............................................ 24 ITEM 6. Exhibits and Reports on Form 8-K............................. 24 2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS IMRGLOBAL CORP. CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
DECEMBER 31, SEPTEMBER 30, 1999 2000 --------- --------- (Unaudited) ASSETS Current assets: Cash and cash equivalents ................................... $ 35,021 $ 15,894 Marketable securities ....................................... 2,411 -- Accounts receivable, net of allowance ....................... 46,031 64,523 Unbilled work in process .................................... 7,756 16,297 Deferred income taxes ....................................... 10,606 12,286 Prepaid expenses and other current assets ................... 6,340 6,603 --------- --------- Total current assets .................................. 108,165 115,603 Property and equipment, net of accumulated depreciation ........ 36,973 39,144 Capitalized software costs, net of accumulated amortization .... 3,839 5,196 Deferred income taxes .......................................... 2,309 1,628 Deposits and other assets ...................................... 9,317 16,611 Intangible assets, net of accumulated amortization: Goodwill .................................................... 138,535 162,451 Acquired technology ......................................... 4,660 3,766 --------- --------- Total assets .......................................... $ 303,798 $ 344,399 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Revolving credit loans ...................................... $ 10,258 $ 8,650 Accounts payable ............................................ 10,349 4,239 Accrued compensation ........................................ 11,341 20,408 Deferred revenue ............................................ 3,286 6,919 Other current liabilities ................................... 25,840 22,856 --------- --------- Total current liabilities ............................. 61,074 63,072 Long-term debt ................................................. 985 30,904 Deferred income taxes .......................................... 1,594 580 Accrued compensation ........................................... 5,222 4,849 --------- --------- Total liabilities ..................................... 68,875 99,405 --------- --------- Shareholders' equity: Common stock ................................................ 3,713 4,132 Additional paid-in capital .................................. 213,748 216,346 Retained earnings ........................................... 21,594 32,792 Notes receivable from share sales ........................... (703) (591) Treasury stock .............................................. (1,118) (2,214) Accumulated other comprehensive loss ........................ (2,311) (5,471) --------- --------- Total shareholders' equity ............................ 234,923 244,994 --------- --------- Total liabilities and shareholders' equity ............ $ 303,798 $ 344,399 ========= =========
The accompanying notes are an integral part of these consolidated financial statements. 3 IMRGLOBAL CORP. CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED AND IN THOUSANDS EXCEPT PER SHARE DATA)
THREE MONTHS ENDED SEPTEMBER 30, NINE MONTHS ENDED SEPTEMBER 30, -------------------------------- ------------------------------- 1999 2000 1999 2000 --------- --------- --------- --------- Revenue ......................................... $ 62,159 $ 75,208 $ 177,000 $ 202,893 Cost of revenue ................................. 35,059 42,688 97,173 116,999 --------- --------- --------- --------- Gross profit ........................... 27,100 32,520 79,827 85,894 Selling, general and administrative expenses .... 16,367 18,336 39,997 54,988 Research and development expenses ............... 1,888 1,252 4,730 3,420 Goodwill and intangible amortization ............ 2,026 2,522 4,755 7,766 Acquired in-process research and development .... -- -- 3,410 -- Acquisition costs ............................... -- -- 1,936 -- --------- --------- --------- --------- Income from operations ................. 6,819 10,410 24,999 19,720 Other income (expense): Interest expense ....................... (3) (725) (6) (1,721) Interest income and other .............. 1,343 (181) 4,022 722 --------- --------- --------- --------- Total other income (expense) ........... 1,340 (906) 4,016 (999) --------- --------- --------- --------- Income before provision for income taxes ........ 8,159 9,504 29,015 18,721 Provision for income taxes ...................... 2,967 3,534 11,587 7,523 --------- --------- --------- --------- Net income ............................. $ 5,192 $ 5,970 $ 17,428 $ 11,198 ========= ========= ========= ========= Earnings per share: Basic .................................. $ 0.13 $ 0.15 $ 0.50 $ 0.28 ========= ========= ========= ========= Diluted ................................ $ 0.12 $ 0.14 $ 0.44 $ 0.26 ========= ========= ========= ========= Shares outstanding: Basic .................................. 38,486 40,791 34,923 39,395 ========= ========= ========= ========= Diluted ................................ 42,471 43,565 39,486 43,375 ========= ========= ========= =========
The accompanying notes are an integral part of these consolidated financial statements. 4 IMRGLOBAL CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED AND IN THOUSANDS)
NINE MONTHS ENDED SEPTEMBER 30, ------------------------------- 1999 2000 -------- -------- Cash flows from operating activities: Net income .................................................................. $ 17,428 $ 11,198 Adjustments to reconcile net income to cash provided by (used in) operating activities: Depreciation and amortization ............................................ 8,191 12,636 In-process research and development ...................................... 3,410 -- Tax benefit of stock options ............................................. 2,829 479 Income taxes ............................................................. 6,309 2,569 Changes in operating assets and liabilities: Accounts receivable, unbilled work-in-process and deferred revenue .... (13,570) (21,327) Other assets .......................................................... (12,766) (2,909) Other liabilities ..................................................... (1,705) (7,536) -------- -------- Total adjustments ..................................................... (7,302) (16,088) -------- -------- Net cash provided by (used in) operating activities ................... 10,126 (4,890) -------- -------- Cash flows from investing activities: Acquisition of consolidated subsidiaries, net of cash acquired .................................................... (17,461) (28,970) Investment in marketable securities, net .................................... 15,075 2,411 Additions to capitalized software costs ..................................... (1,433) (1,889) Additions to property and equipment ......................................... (20,363) (5,805) Related party loan .......................................................... -- (4,902) -------- -------- Net cash used in investing activities ................................. (24,182) (39,155) -------- -------- Cash flows from financing activities: Net advances (repayments) from revolving credit line ........................ (443) (1,616) Payments on long-term debt .................................................. (5,315) (1,436) Increase in long-term debt .................................................. -- 30,867 Proceeds from issuance of common stock ...................................... 1,120 1,560 Repayment of note receivable from share sales ............................... -- 112 Purchase of treasury shares ................................................. -- (1,128) -------- -------- Net cash provided by (used in) financing activities ................... (4,638) 28,359 -------- -------- Effect of exchange rate changes ................................................ (1,365) (3,441) -------- -------- Net decrease in cash and cash equivalents ...................................... (20,059) (19,127) Cash and cash equivalents at beginning of period ............................... 78,807 35,021 -------- -------- Cash and cash equivalents at end of period ..................................... $ 58,748 $ 15,894 ======== ========
The accompanying notes are an integral part of these consolidated financial statements. 5 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 1. BASIS OF PRESENTATION In the opinion of management, the accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles and include all adjustments necessary for a fair presentation. The results of operations for the three month and nine month periods ended September 30, 2000 are not necessarily indicative of the results to be expected for the full year. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 1999, which are contained in IMRglobal's Annual Report on Form 10-K ("Form 10-K") as filed with the Securities and Exchange Commission (the "Commission"). 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION--The consolidated financial statements include the accounts of IMRglobal Corp. ("IMRglobal") and its wholly and majority owned subsidiaries. All significant intercompany balances and transactions have been eliminated. REVENUE RECOGNITION--Fixed-price contract revenue and revenue from the sale of software that requires significant modification is recognized using the percentage of completion method of accounting, under which the sales value of performance, including earnings thereon, is recognized on the basis of the percentage that each contract's cost to date bears to the total estimated cost. Any anticipated losses upon contract completion are accrued currently. Service revenue from time-and-materials services is recognized as the services are provided. Unbilled work-in-progress represents revenue on contracts to be billed in subsequent periods in accordance with the terms of the contract. Deferred revenue represents amounts billed in excess of revenue earned in accordance with the terms of the contracts. COMPUTATION OF EARNINGS PER SHARE--Basic earnings per share is computed using the weighted average of common stock outstanding. Diluted earnings per share is computed using the treasury stock method which is summarized as follows (in thousands):
THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, ------------------ ------------------ 1999 2000 1999 2000 ------ ------ ------ ------ Weighted average common stock outstanding ........ 38,486 40,791 34,923 39,395 Weighted average common stock equivalents ........ 3,985 2,774 4,563 3,980 ------ ------ ------ ------ Shares used in diluted earnings per share calculation ........... 42,471 43,565 39,486 43,375 ====== ====== ====== ======
6 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) CAPITALIZED SOFTWARE COSTS--Capitalized software costs are recorded at cost less accumulated amortization. Production costs for computer software that is to be utilized as an integral part of a product or process is capitalized when both (a) technological feasibility is established for the software and (b) all research and development activities have been completed. Amortization is charged to income based upon a revenue formula over the shorter of the remaining estimated economic life of the product or estimated lifetime revenue of the product. USE OF ESTIMATES--The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. RECENT ACCOUNTING PRONOUNCEMENTS--In December 1999, the U.S. Securities and Exchange Commission (the "SEC") issued Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements ("SAB 101"). SAB 101 provides guidance on applying generally accepted accounting principles to revenue recognition in financial statements. The Company is required to adopt SAB 101 no later than the fourth quarter of fiscal year 2000. Management estimates the effect of adopting SAB 101 will result in a cumulative charge approximating $2.0 to $3.0 million, net of applicable taxes. Management estimates that revenue for the nine months ended September 30, 2000 will not be materially impacted by the adoption of SAB 101. 3. CREDIT FACILITIES During 2000, IMRglobal temporarily increased its credit facility to provide an additional $15.0 million of availability under the agreement, bringing the total availability to $45.0 million. The additional $15.0 million is due in December 2000. In addition, the term of the primary credit facility was extended to February 2003. At September 30, 2000, the Company had $7.0 million available under this agreement. 7 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 4. SHAREHOLDERS' EQUITY Changes in shareholders' equity for the nine months ended September 30, 2000 are summarized as follows (in thousands):
COMPRE- NOTES ACCUMULATED HENSIVE ADDITIONAL RECEIVABLE OTHER INCOME COMMON PAID-IN RETAINED FROM SHARE TREASURY COMPREHENSIVE (LOSS) STOCK CAPITAL EARNINGS SALES STOCK LOSS TOTAL --------- --------- --------- --------- --------- --------- --------- --------- Balance, December 31, 1999 ...... $ -- $ 3,713 $ 213,748 $ 21,594 $ (703) $ (1,118) $ (2,311) $ 234,923 Common stock issued in connection with acquisitions.. -- 116 9,395 -- -- -- -- 9,511 Lyon stock price contingency payment .......... -- -- (8,500) -- -- -- -- (8,500) Employee stock purchase plan .... -- 11 958 -- -- 32 -- 1,001 Repayment of note receivable from share sales ............. -- -- -- -- 112 -- -- 112 Stock options exercised ......... -- 292 267 -- -- -- -- 559 Tax benefit of stock options exercised ...... -- -- 478 -- -- -- -- 478 Purchase of treasury stock ...... -- -- -- -- -- (1,128) -- (1,128) Net income ...................... 11,198 -- -- 11,198 -- -- -- 11,198 Translation adjustment .......... (3,160) -- -- -- -- -- (3,160) (3,160) --------- Comprehensive income ............ $ 8,038 -- -- -- -- -- -- -- ========= --------- --------- --------- --------- --------- --------- --------- Balance, September 30, 2000 ..... $ 4,132 $ 216,346 $ 32,792 $ (591) $ (2,214) $ (5,471) $ 244,994 ========= ========= ========= ========= ========= ========= =========
5. BUSINESS COMBINATIONS INTUITIVE GROUP LIMITED ("INTUITIVE")--On January 28, 2000, IMRglobal acquired 100% of the outstanding stock of Intuitive Group Limited, headquartered in London. Intuitive was a privately held provider of customer relationship management ("eCRM") software solutions and services for the financial services markets. Intuitive had additional offices in Boston and Sydney. In exchange for Intuitive's common stock, Intuitive's shareholders received approximately $18.0 million in cash. In addition, $394,000 in cash and 327,997 shares of IMRglobal common stock was paid to the Intuitive shareholders during July 2000 based on the achievement of certain financial objectives for the period ended March 31, 2000, as defined in the original agreement. The contingent payment resulted in a corresponding increase in the purchase price and the resulting goodwill. The Intuitive acquisition is accounted for as a purchase pursuant to the provisions of APB Opinion No. 16. LYON CONSULTANTS S.A.("LYON")--During May 1998, IMRglobal acquired 100% of Lyon Consultants S.A. ("Lyon") for approximately $16.7 million in cash and 531,353 shares of IMRglobal common stock. In addition, the acquisition agreement, as amended, provided that if the average price of the IMRglobal shares on NASDAQ was less than $34.05 per share for the seven trading days prior to May 15, 2000, then IMRglobal would pay the former Lyon shareholders the difference between the average price on NASDAQ and $34.05 multiplied by 499,353 shares. During June 2000, IMRglobal paid $8.5 million in cash as a final settlement of this contingency. 8 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 5. BUSINESS COMBINATIONS (CONTINUED) NEVERDAHL-LOFT & ASSOCIATES, INC. ("NEVERDAHL")--In connection with IMRglobal's December 1999 acquisition of Neverdahl, IMRglobal paid $2.0 million in cash to the former Neverdahl shareholders for attaining certain financial objectives for the period ended June 30, 2000. This payment resulted in an increase in the purchase price and the resulting goodwill. 6. ACQUISITIONS During 1999 and 2000, IMRglobal completed several acquisitions. The following unaudited table compares IMRglobal's reported operating results to pro forma information prepared on the basis that all acquisitions had taken place on January 1, 1999 (in thousands except per share amounts): SEPTEMBER 30, ---------------------- 1999 2000 -------- -------- As reported: Revenue ................................. $177,000 $202,893 Net income .............................. $ 17,428 $ 11,198 Basic earnings per share ................ $ 0.50 $ 0.28 Diluted earnings per share .............. $ 0.44 $ 0.26 Pro forma: Revenue ................................. $229,204 $204,777 Net income .............................. $ 16,474 $ 11,549 Basic earnings per share ................ $ 0.43 $ 0.29 Diluted earnings per share .............. $ 0.39 $ 0.27 Adjusted pro forma revenue after removal of Year 2000 services .... $195,473 $204,777 In management's opinion, the pro forma combined results of operations are not indicative of the actual results that would have occurred had the acquisitions been consummated at the beginning of 1999 or 2000 or of future operations of the combined companies under the ownership and management of IMRglobal. 7. SEGMENT INFORMATION (IN THOUSANDS) IMRglobal operates several business units located in North America, Europe and Asia for which financial information is maintained and reported to the chief operating decision makers of the Company. In determining the reporting segments of the Company, management has aggregated the business units that have similar economic characteristics, products and services and types of customers. 9 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 7. SEGMENT INFORMATION (IN THOUSANDS) (CONTINUED) IMRglobal has three reporting segments. The Information Technology Solutions and Services ("IT") segment provides consulting and technology services to large companies in North America, Europe and Asia. The Health Care and Government Solutions segment provides business and consulting services to clients in the health care and governmental industries. Software Development Centers consist of two Indian facilities that provide software development services to the IT segment organizations. The chief operating decision makers evaluate performance and allocate resources based on revenue and net profit. Net profit is gross profit less selling, general and administrative expenses. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. IMRglobal does not allocate income taxes, other income or expense, research and development, intangible amortization and non-recurring charges to its reporting segments. In addition, IMRglobal accounts for services provided by the Software Development Centers to the IT segment at current market prices. Information regarding the reporting segments is as follows:
INFORMATION HEALTH TECHNOLOGY CARE AND SOFTWARE SOLUTIONS GOVERNMENT DELIVERY AND SERVICES SOLUTIONS CENTERS TOTAL ------------ --------- -------- -------- NINE MONTHS ENDED SEPTEMBER 30, 2000 Revenue from external customers .... $173,275 $ 29,239 $ 379 $202,893 ======== ======== ======== ======== Intersegment revenue ............... $ 5,121 $ -- $ 18,740 $ 23,861 ======== ======== ======== ======== Depreciation expense ............... $ 3,127 $ 162 $ 1,048 $ 4,337 ======== ======== ======== ======== Segment net profit ................. $ 21,969 $ 8,060 $ 877 $ 30,906 ======== ======== ======== ======== Segment assets ..................... $154,437 $ 16,310 $ 17,134 $187,881 ======== ======== ======== ======== NINE MONTHS ENDED SEPTEMBER 30, 1999 Revenue from external customers .... $164,957 $ 11,178 $ 865 $177,000 ======== ======== ======== ======== Intersegment revenue ............... $ 674 $ -- $ 24,549 $ 25,223 ======== ======== ======== ======== Depreciation expense ............... $ 2,550 $ 55 $ 831 $ 3,436 ======== ======== ======== ======== Segment net profit ................. $ 32,231 $ 3,365 $ 4,234 $ 39,830 ======== ======== ======== ========
10 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 7. SEGMENT INFORMATION (IN THOUSANDS) (CONTINUED)
INFORMATION HEALTH TECHNOLOGY CARE AND SOFTWARE SOLUTIONS GOVERNMENT DELIVERY AND SERVICES SOLUTIONS CENTERS TOTAL ------------ -------- -------- -------- THREE MONTHS ENDED SEPTEMBER 30, 2000 Revenue from external customers .......... $ 63,817 $ 11,432 $ (41) $ 75,208 ======== ======== ======== ======== Intersegment revenue ..................... $ 286 $ -- $ 6,516 $ 6,802 ======== ======== ======== ======== Depreciation expense ..................... $ 1,028 $ 59 $ 362 $ 1,449 ======== ======== ======== ======== Segment net profit ....................... $ 10,695 $ 3,247 $ 242 $ 14,184 ======== ======== ======== ======== THREE MONTHS ENDED SEPTEMBER 30, 1999 Revenue from external customers .......... $ 53,084 $ 8,958 $ 117 $ 62,159 ======== ======== ======== ======== Intersegment revenue ..................... $ 316 $ -- $ 11,282 $ 11,598 ======== ======== ======== ======== Depreciation expense ..................... $ 967 $ 44 $ 278 $ 1,289 ======== ======== ======== ======== Segment net profit ....................... $ 7,337 $ 2,616 $ 780 $ 10,733 ======== ======== ======== ========
Following are reconciliations of reporting segment net profit and assets to the amounts included in the consolidated financial statements:
NINE MONTHS ENDED SEPTEMBER 30, ------------------------------- 1999 2000 -------- -------- Total net profit for reportable segments ........ $ 39,830 $ 30,906 Research and development ........................ (4,730) (3,420) Goodwill and intangible amortization ............ (4,755) (7,766) Acquired in-process research and development .... (3,410) -- Acquisition costs ............................... (1,936) -- Other income (expense) .......................... 4,016 (999) -------- -------- Consolidated income before provision for income taxes ............ $ 29,015 $ 18,721 ======== ========
11 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 7. SEGMENT INFORMATION (IN THOUSANDS) (CONTINUED)
THREE MONTHS ENDED SEPTEMBER 30, -------------------------------- 1999 2000 -------- -------- Total net profit for reportable segments .... $ 10,733 $ 14,184 Research and development .................... (1,888) (1,252) Goodwill and intangible amortization ........ (2,026) (2,522) Other income ................................ 1,340 (906) -------- -------- Income before provision for income taxes .... $ 8,159 $ 9,504 ======== ======== DECEMBER 31, SEPTEMBER 30, --------- --------- 1999 2000 --------- --------- Total assets for reportable segments ....... $ 161,991 $ 187,881 Elimination of intersegment receivables .... (14,303) (23,613) Deferred income taxes ...................... 12,915 13,914 Intangible assets .......................... 143,195 166,217 --------- --------- Total assets ............................... $ 303,798 $ 344,399 ========= =========
12 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 8. RESTRUCTURING CHARGE In the fourth quarter of 1999, IMRglobal implemented a restructuring plan to redeploy resources to exploit its expanding e-business service offering and better align its organization with its corporate strategy. The restructuring plan included the closure of three European offices, the write-down of specific mainframe software and hardware and the reduction of its global workforce. During the third quarter of 2000, IMRglobal initiated a plan to consolidate Canadian operations by closing three western Canada offices. The restructuring charge is summarized as follows (in thousands):
CASH PAID ACCRUED WRITE- ADDITIONAL THROUGH ADJUSTMENT CHARGE RESTRUCTURING DOWN RESTRUCTURING SEPTEMBER 30, FOR CERTAIN SEPTEMBER 30, CHARGE OF ASSETS CHARGES 2000 RESERVES 2000 -------- -------- -------- -------- -------- -------- Closure of European facilities: Severance payments (80 employees) ............... $ 664 $ -- $ -- $ (1,386) $ 722 $ -- Long-term commitments ........... 4,626 -- -- (954) (1,881) 1,791 Goodwill ........................ 348 (348) -- -- -- -- Property and equipment .......... 1,089 (1,089) -- -- -- -- Closure of Canadian facilities: Severence payments (40 employees) ............... -- -- 298 (245) -- 53 Long-term commitments ........... -- -- 271 (44) -- 227 Property and equipment .......... -- (339) 339 -- -- -- Other severance payments ........... -- (70 employees) .................. 1,809 -- -- (1,606) (113) 90 Property and equipment ............. 3,691 (3,691) -- -- -- -- Other restructuring costs .......... 150 -- 7 (57) 50 150 -------- -------- -------- -------- -------- -------- $ 12,377 $ (5,467) $ 915 $ (4,292) $ (1,222) $ 2,311 ======== ======== ======== ======== ======== ========
Long-term commitments relating to real estate leases are expected to be paid over the life of the underlying lease agreements which expire through 2013. The remaining accrued charge is expected to be paid by December 31, 2001. During 2000, IMRglobal renegotiated various long-term commitments related to the European facilities and the payment of more generous severance payments for U.K. employees. Accordingly, during the year ended September 30, 2000, adjustments were made to certain reserves. 13 IMRGLOBAL CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2000 (UNAUDITED) 9. CONTINGENCIES IMRglobal's French subsidiary has claimed a special tax exemption for the 1993 through 1995 fiscal years. The French taxing authorities have challenged this exemption and have made an assessment of approximately $500,000. Ongoing discussions are being held between IMRglobal's French management and the French taxing authorities regarding this issue. The amount of assessment, $500,000, is included as a liability in the accompanying financial statements. 10. RELATED PARTY TRANSACTION Deposits and other assets include a $4.9 million note receivable from IMRglobal's Chief Executive Officer ("CEO") in accordance with his employment agreement. This note bears interest at prime plus 1% (currently 10.5%) and is repayable at the earlier of May, 2004 or 180 days after the CEO terminates employment with IMRglobal. 14 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Except for historical information, some matters discussed in our report constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We note that a variety of risk factors could cause our actual results and experience to differ materially from the anticipated results or other expectations expressed in our forward-looking statements including the following: o our ability to continue to increase our revenue; o our anticipation that research and development expenses will be under 2.0% of revenue for the remainder of fiscal 2000; and o our ability to refinance our short-term credit facilities. Reference is made in particular to the remaining discussion in this report and as set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 1999, as filed with the Commission. CURRENT DEVELOPMENTS RESULTS OF OPERATIONS. After our 1996 initial public offering, we experienced sequential revenue and earnings per share growth (excluding one-time charges) for each of the eleven quarters ended June 30, 1999. However, both revenue and earnings decreased in the following two quarters and included a loss for the three months ended December 31, 1999 as we converted to a vertical industry focused company. For the three months ended March 31, 2000, June 30, 2000 and September 30, 2000, our revenue improved significantly compared to the three months ended December 31, 1999. This improvement was primarily due to the acquisitions completed subsequent to June 30, 1999, significant growth in our Health Care and Governmental business unit and a continued shift to our vertical industry focused business model. NON-CASH CHARGES. Due to the following factors, our amortization and depreciation expense have increased significantly as a proportion of our total expenses: o ten significant acquisitions from May 1998 through January 2000; o investment in real estate and infrastructure in India; and o completion of our global headquarters in Clearwater, Florida. Accordingly, in addition to our analysis of income from operations, net income and earnings per share we also present such results on a pro forma basis exclusive of the impact of amortization and depreciation. 15 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) Three Months Ended September 30, 2000 Compared to Three Months Ended September 30, 1999
THREE MONTHS ENDED SEPTEMBER 30, ----------------------------------------------------- % OF % OF PERCENT 1999 REVENUE 2000 REVENUE CHANGE -------- -------- -------- -------- -------- Revenue ..................................... $ 62,159 100% $ 75,208 100% 21% Cost of revenue ............................. 35,059 56 42,688 57 22 -------- -------- -------- -------- Gross profit ....................... 27,100 44 32,520 43 20 Selling, general and administrative ......... 16,367 26 18,336 24 12 Research and development .................... 1,888 3 1,252 2 (34) Goodwill and intangible amortization .................. 2,026 3 2,522 3 24 -------- -------- -------- -------- Income (loss) from operations ...... 6,819 11 10,410 14 53 Other income (expense): Interest expense ......................... (3) 0 (725) (1) -- Other income ............................. 1,343 2 (181) 0 (113) -------- -------- -------- -------- Total other income (expense) ....... 1,340 2 (906) (1) (188) -------- -------- -------- -------- Income (loss) before provision for income taxes ............... 8,159 13 9,504 13 16 Provision for income taxes .................. 2,967 5 3,534 5 19 -------- -------- -------- -------- Net income ......................... $ 5,192 8% $ 5,970 8% 15% ======== ======== ======== ========
REVENUE. Revenue for the three months ended September 30, 2000 increased 21% over revenue for the three months ended September 30, 1999. This increase was despite a decrease of $6.1 million from Year 2000 services. This increase was attributable to: o acquisitions accounted for under the purchase method since June 30, 1999; o an increase in revenue from service offerings not related to Year 2000 service offerings of 34% over non Year 2000 revenue for the prior year; and o significant growth in our Health Care and Governmental unit. 16 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) THREE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 1999 Revenue by vertical industry is as follows: THREE MONTHS ENDED -------------------- 1999 2000 ------- ------- Financial Services $24,148 $38,012 Health Care and Governmental 8,958 11,432 Commercial Services 29,053 25,764 ------- ------- $62,159 $75,208 ======= ======= COST OF REVENUE. Cost of revenue as a percentage of revenue remained relatively flat at 57% for the three months ended September 30, 2000 compared to 56% for the three months ended September 30, 1999. GROSS PROFIT. Gross profit as a percentage of revenue remained relatively flat at 43% for the three months ended September 30, 2000 compared to 44% for the three months ended September 30, 1999. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ("SG&A"). As a percentage of revenue, SG&A expenses for the three months ended September 30, 2000 decreased to 24% from 26% for the same period in 1999. The decrease was primarily due to the impact of our acquisition integration. We expect SG&A expenses to increase in absolute dollars going forward as we make additional investments to support our sales and marketing initiatives. RESEARCH AND DEVELOPMENT EXPENSES ("R&D"). Research and development expenses decreased 34% compared to the same period in the prior year as management discontinued certain research initiatives. We anticipate that R&D expenses will be less than 2.0% as a percentage of revenue in the fourth quarter of 2000. GOODWILL AND INTANGIBLE AMORTIZATION. The increase in goodwill and intangible amortization of 24% for the three months ended September 30, 2000 compared to the three months ended September 30, 1999 primarily reflects the additional amortization of goodwill and intangibles generated by our acquisitions in December 1999 and January 2000. INCOME FROM OPERATIONS. Income from operations increased 53% over the same period of the prior year. As a percentage of revenue, income from operations for the three months ended September 30, 2000 increased to 14% from 11% in the three months ended September 30, 1999. Excluding amortization and depreciation, income from operations for the three months ended September 30, 2000 increased to $14.5 million from $10.1 million in the three months ended September 30, 1999. 17 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) THREE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 1999 OTHER INCOME (EXPENSE). We realized $906,000 of other expense (net of other income) in the three months ended September 30, 2000 as compared to $1.3 million of other income (net of other expense) in the three months ended September 30, 1999. Approximately $509,000 of this net expense was due to foreign exchange losses as several European and Asian currencies depreciated significantly against the U.S. dollar during the three months ended September 30, 2000. The remaining change reflects the decrease in our invested cash balances over the past year and an expansion of our credit facilities. PROVISION FOR INCOME TAXES. Our effective tax rate was 37% for the three months ended September 30, 2000 compared to 36% for the three months ended September 30, 1999. We have not recorded deferred income taxes applicable to undistributed earnings of IMRglobal-India. Those earnings are considered to be indefinitely reinvested and, accordingly, no provision for United States federal and state income tax has been provided thereon. NET INCOME. Net income increased 15% for the three months ended September 30, 2000 compared to the three months ended September 30, 1999. Excluding amortization and depreciation, net income increased to $9.1 million for the three months ended September 30, 2000 compared to $7.8 million for the three months ended September 30, 1999. EARNINGS PER SHARE. Diluted earnings per share increased 17% for the three months ended September 30, 2000 compared to the three months ended September 30, 1999. Excluding amortization and depreciation pro forma earnings per share increased to $0.21 for the three months ended September 30, 2000 compared to $0.18 for the three months ended September 30, 1999. 18 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 1999
NINE MONTHS ENDED SEPTEMBER 30, --------------------------------------------------------- % OF % OF PERCENT 1999 REVENUE 2000 REVENUE CHANGE --------- --------- --------- --------- ---------- Revenue ................................... $ 177,000 100% $ 202,893 100% 15% Cost of revenue ........................... 97,173 55 116,999 58 20 --------- --------- --------- --------- Gross profit ..................... 79,827 45 85,894 42 8 Selling, general and administrative ....... 39,997 23 54,988 27 37 Research and development .................. 4,730 3 3,420 2 (28) Goodwill and intangible amortization ................ 4,755 3 7,766 4 63 Acquired in-process R&D ................... 3,410 2 -- 0 (100) Acquisition costs ......................... 1,936 1 -- 0 (100) --------- --------- --------- --------- Income (loss) from operations .... 24,999 14 19,720 10 (21) Other income (expense): Interest expense ....................... (6) 0 (1,721) (1) -- Other income ........................... 4,022 2 722 0 (82) --------- --------- --------- --------- Total other income (expense) ..... 4,016 2 (999) 0 (125) --------- --------- --------- --------- Income (loss) before provision for income taxes ............. 29,015 16 18,721 10 (35) Provision for income taxes ................ 11,587 7 7,523 4 (35) --------- --------- --------- --------- Net income ....................... $ 17,428 10% $ 11,198 6% (36)% ========= ========= ========= =========
REVENUE. Revenue for the nine months ended September 30, 2000 increased 15% over revenue for the nine months ended September 30, 1999. This increase was attributable to: o acquisitions accounted for under the purchase method since June 30, 1999; o an increase in revenue from service offerings not related to Year 2000 service offerings of 42% over non Year 2000 revenue for the prior year; and o significant growth in our Health Care and Governmental unit. 19 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 1999 Revenue by vertical industry is as follows: NINE MONTHS ENDED ---------------------- 1999 2000 -------- -------- Financial Services $ 67,887 $100,948 Health Care and Governmental 11,178 29,239 Commercial Services 97,935 72,706 -------- -------- $177,000 $202,893 ======== ======== COST OF REVENUE. Cost of revenue as a percentage of revenue increased to 58% for the nine months ended September 30, 2000 compared to 55% for the nine months ended September 30, 1999. This increase was primarily attributable to reduced utilization of our software development facilities in India. GROSS PROFIT. Gross profit increased 8%, to $85.9 million in the nine months ended September 30, 2000 from $79.8 million in the nine months ended September 30, 1999. Gross profit as a percentage of revenue decreased to 42% for the nine months ended September 30, 2000 compared to 45% for the nine months ended September 30, 1999. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. SG&A increased 37% over the same period of the prior year. As a percentage of revenue, SG&A expenses for the nine months ended September 30, 2000 increased to 27% from 23% for the same period in 1999. The increase was principally due to costs associated with the 100% expansion of our sales force, aggressive implementation of certain marketing initiatives and integration costs related to the multiple acquisitions made prior to 2000. We expect SG&A expenses to increase in absolute dollars going forward as we make additional investments to support our sales and marketing initiatives. RESEARCH AND DEVELOPMENT EXPENSES. Research and development expenses decreased 28% compared to the same period in the prior year as management discontinued certain research initiatives. We anticipate that R&D expenses will be less than 2.0% as a percentage of revenue for the full year. GOODWILL AND INTANGIBLE AMORTIZATION. The increase in goodwill and intangible amortization of 63% for the nine months ended September 30, 2000 compared to the nine months ended September 30, 1999 reflects the additional amortization of goodwill and intangibles generated by our acquisitions during 1999 and in January of 2000. 20 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 1999 INCOME FROM OPERATIONS. Income from operations decreased 21% over the same period of the prior year. As a percentage of revenue, income from operations for the nine months ended September 30, 2000 decreased to 10% from 14% in the nine months ended September 30, 1999. Excluding amortization and depreciation, income from operations for the nine months ended September 30, 2000 decreased to $32.4 million from $33.2 million in the nine months ended September 30, 1999. OTHER INCOME (EXPENSE). We realized $999,000 of other expense (net of other income) in the nine months ended September 30, 2000 as compared to $4.0 million of other income (net of other expense) in the nine months ended September 30, 1999. This change reflects the decrease in our invested cash balances over the past year and an expansion of our credit facilities. PROVISION FOR INCOME TAXES. Our effective tax rate was 40% for both the nine months ended September 30, 2000 and the nine months ended September 30, 1999. We have not recorded deferred income taxes applicable to undistributed earnings of IMRglobal-India. Those earnings are considered to be indefinitely reinvested and, accordingly, no provision for United States federal and state income tax has been provided thereon. NET INCOME. Net income decreased 36% for the nine months ended September 30, 2000 compared to the nine months ended September 30, 1999. Excluding amortization, depreciation and one-time charges, net income decreased to $20.7 million for the nine months ended September 30, 2000 compared to $23.9 million for the nine months ended September 30, 1999. EARNINGS PER SHARE. Diluted earnings per share decreased 41% for the nine months ended September 30, 2000 compared to the nine months ended September 30, 1999. Excluding amortization, depreciation and one-time charges pro forma earnings per share decreased to $0.48 for the nine months ended September 30, 2000 compared to $0.61 for the nine months ended September 30, 1999. 21 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) LIQUIDITY AND CAPITAL RESOURCES As of September 30, 2000, we had liquid assets including cash, cash equivalents and marketable securities of $15.9 million, as compared to $37.4 million at December 31, 1999. The decrease was primarily attributable to acquisitions. Additionally, we had working capital at September 30, 2000 of $52.5 million and available bank lines of credit approximating $9.6 million. Net cash used in operating activities was $4.9 million for the nine months ended September 30, 2000. The negative cash flow from operations primarily reflects the growth in our accounts receivable balances as a result of revenue growth and decreased current liabilities as we paid significant accrued compensation and restructuring charges in the first three months of 2000. During the most recent six month period (April 1, 2000 through September 30, 2000) $1.8 million of net cash was provided by operations. Net cash used in investing activities was $39.2 million for the nine months ended September 30, 2000. We invested $29.0 million in the acquisition of subsidiaries and the settlement of contingent acquisition consideration, $5.8 million in property and equipment and $4.9 million in a loan to our CEO. Net cash provided by financing activities was $28.4 million for the nine months ended September 30, 2000. We added $30.9 million of bank debt primarily to finance our investing activities. As of September 30, 2000, cash and cash equivalents totaled $15.9 million, of which $10.8 million was held outside of the U.S. Liquid assets in India were $738,000 and require governmental approval for repatriation outside of India. During 2000, approximately $9.0 million of cash was repatriated from India and used to finance our 2000 acquisitions. We maintain a $30.0 million credit facility expiring in February 2003. This facility had been temporarily increased by $15.0 million until December 2000. These facilities bear interest at LIBOR plus 1.25% (7.9% as of September 30, 2000) and are collateralized by virtually all of our assets. The interest rate may be increased by up to an additional 1.15% based on certain financial ratios. At September 30, 2000, we had $7.0 million available under these facilities. Certain of our subsidiaries also maintain additional revolving credit line facilities totaling $3.3 million. At September 30, 2000, the amount available under these facilities was $2.6 million. The respective subsidiary's accounts receivable and property and equipment collateralize these facilities. 22 IMRGLOBAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) LIQUIDITY AND CAPITAL RESOURCES (CONTINUED) We continuously review our future cash requirements, together with our available bank lines of credit and internally generated funds. We anticipate replacing our short-term facility of $15 million with a long-term facility during December 2000. If we are unable to place this facility, we may be required to repatriate approximately $5.0 million from our foreign subsidiaries in order to repay this facility during December 2000. Although we do not anticipate this repatriation to result in any additional income taxes, due to the complexities of international tax rules, some additional income taxes may result. We believe we have adequate capital resources to meet all working capital obligations and fund the development of our current business operations, including the following business objectives: o continued expansion of existing business; o continued funding of research and development initiatives; o anticipated levels of capital expenditures; and o any debt repayment requirements. ASSET MANAGEMENT Our accounts receivable balance was $64.5 million at September 30, 2000, an increase of $18.5 million from December 31, 1999. The increase was primarily due to a new acquisition and revenue growth of 67% over the fourth quarter of 1999. A common financial measure is the calculation of days sales outstanding in accounts receivable ("DSO"). At September 30, 2000, our DSO was 77 days. The Orion acquisition adds approximately 9 days to our DSO due to the traditionally longer payment cycles prevalent in the health care industry. In addition, accounts receivable in Canada, France, Japan and the U.K. include value added taxes that are not included in revenue. Without valued added taxes, DSO would be approximately 4 days less than the above levels. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS IMRglobal is exposed to market risk from changes in interest rates and exchange rates between the U.S. dollar and the currencies of various countries in which we operate. IMRglobal has not engaged in hedging transactions and is not a party to any leveraged derivatives. 23 IMRGLOBAL CORP. PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS The Company is not a party to any pending material litigation. ITEM 2. CHANGES IN SECURITIES On July 5, 2000, in connection with the January 31, 2000 acquisition of Intuitive Group Limited ("Intuitive") by merger with a subsidiary of the Company, the Company issued 327,997 shares of its common stock, par value $.10 per share, to eleven former shareholders and optionholders of Intuitive (the "Purchasers"). The issuance was made pursuant to an earnout arrangement with the recipients and the issuance satisfied on obligation of the Company in the amount of $4.6 million. The Company issued the shares without registration under the Securities Act of 1933, as amended (the "Act"). The Company relied upon the exemptions set forth in Section 4(2) of the Act, Rule 505 of Regulation D as well as Regulation S. In the transaction, the Company (a) made available to the Purchasers the information required by Rule 502(c) of Regulation D, (b) did not offer the shares by means of advertisement, general solicitation or other means perscribed by Rule 502(c) of Regulation D, (c) informed the Purchasers of the limitation on resale of the shares and placed an appropriate restrictive legend on the share certificates, and (d) filed a notice on Form D with the Securities and Exchange Commission within 15 days after the share issuance. No underwriter was involved in the transaction. Each Purchaser executed a document in which they represented that they were purchasing the securities for investment only and not for the purpose of resale or distribution. In addition, none of the Purchasers were U.S. persons as defined in Rule 902(k) of Regulation S. ITEM 5. OTHER INFORMATION None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K None 24 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. IMRGLOBAL CORP. Date NOVEMBER 10, 2000 /s/ SATISH K. SANAN --------------------------- ---------------------------------------- Satish K. Sanan Chief Executive Officer Date NOVEMBER 10, 2000 /s/ MICHAEL J. DEAN --------------------------- ---------------------------------------- Michael J. Dean Chief Financial Officer 25 IMRGLOBAL CORP. EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION - ------ ----------- 27 Financial Data Schedule EX-27 2 0002.txt
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 9-MOS DEC-31-2000 JAN-01-2000 SEP-30-2000 15,894 0 65,033 510 0 115,603 52,993 13,849 344,399 63,072 30,904 0 0 4,132 240,862 344,399 0 202,893 0 116,999 65,486 (34) 1,721 18,721 7,523 11,198 0 0 0 11,198 0.28 0.26 Amounts inapplicable or not disclosed as a separate line on the Statement of Financial Position or Results of Operations are reported as 0 herein.
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