-----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, NhQ3k0S5JFbf6ffukKR93co+KmBoBPA+kGL2RCYXobl3dtTxKL5sYQq3Ql6l7C7F AcU72QfRRSAt33qKFywLdA== 0000891618-98-000716.txt : 19980218 0000891618-98-000716.hdr.sgml : 19980218 ACCESSION NUMBER: 0000891618-98-000716 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980213 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SANTA CRUZ OPERATION INC CENTRAL INDEX KEY: 0000851560 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 942549086 STATE OF INCORPORATION: CA FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-21484 FILM NUMBER: 98539822 BUSINESS ADDRESS: STREET 1: 400 ENCINAL STREET STREET 2: PO BOX 1900 CITY: SANTA CRUZ STATE: CA ZIP: 95060 BUSINESS PHONE: 4084277172 10-Q 1 FORM 10-Q FOR THE QUARTER ENDED DECEMEBR 31, 1997 1 ================================================================================ 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 DECEMBER 31, 1997 [ ] 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 0-21484 THE SANTA CRUZ OPERATION, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN THIS CHARTER) CALIFORNIA 94-2549086 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 400 ENCINAL STREET, SANTA CRUZ, CALIFORNIA 95060 (Address of principal executive office) (Zip Code) Registrant's telephone number, including area code (408) 425-7222 Indicate by check mark whether the registrant (1) has filed all reports 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 [ ] The number of shares outstanding of the registrant's common stock as of December 31, 1997 was 36,167,625. ================================================================================ 2 THE SANTA CRUZ OPERATION, INC. FORM 10-Q FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1997 TABLE OF CONTENTS PART I. FINANCIAL INFORMATION
PAGE ---- ITEM 1.FINANCIAL STATEMENTS A) CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 1997 AND 1996............. 1 B) CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 1997 AND SEPTEMBER 30, 1997.................... 2 C) CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED DECEMBER 31, 1997 AND 1996............. 3 D) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ......................... 4 ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS................................................... 6 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS................................................... 9 ITEM 6. EXHIBITS............................................................ 9 SIGNATURES............................................................................. 10
3 Part I. Financial Information Item I. Financial Statements THE SANTA CRUZ OPERATION, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except amounts per share)
THREE MONTHS ENDED DECEMBER 31, ---------------------- 1997 1996 -------- -------- (Unaudited) NET REVENUES $ 47,497 $ 56,608 COST OF REVENUES 12,346 13,663 -------- -------- GROSS MARGIN 35,151 42,945 -------- -------- OPERATING EXPENSES: Research and development 10,759 11,966 Sales and marketing 19,619 20,776 General and administrative 4,604 5,235 -------- -------- Total operating expenses 34,982 37,977 -------- -------- Operating income 169 4,968 OTHER INCOME (EXPENSE): Interest income, net 475 637 Other expense, net 101 (317) -------- -------- Income before income taxes 745 5,288 -------- -------- Income taxes 321 1,322 -------- -------- NET INCOME $ 424 $ 3,966 -------- -------- NET INCOME PER SHARE: Basic $ 0.01 $ 0.11 Diluted $ 0.01 $ 0.11 -------- -------- SHARES USED IN INCOME PER SHARE CALCULATION: Basic 36,345 36,909 Diluted 37,094 37,683 -------- --------
See accompanying notes to consolidated financial statements. 1 4 THE SANTA CRUZ OPERATION, INC. CONSOLIDATED BALANCE SHEETS
December 31, September 30, 1997 1997 ------------ ------------- (In thousands, except for share data) (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 25,631 $ 23,225 Short-term investments 27,207 28,486 Receivables, net 33,491 36,546 Deferred tax assets 6,630 6,631 Other current assets 7,009 6,934 ---------- ---------- Total current assets 99,968 101,822 ---------- ---------- Property and equipment, net 14,080 13,666 Purchased software and technology licenses 14,749 16,523 Other assets 14,197 14,654 ---------- ---------- TOTAL ASSETS $ 142,994 $ 146,665 ---------- ---------- LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Royalties payable $ 8,709 $ 11,262 Trade accounts payable 9,133 8,600 Income taxes payable 1,054 1,101 Accrued expenses and other current liabilities 26,821 27,230 Deferred revenues 6,480 7,465 ---------- ---------- Total current liabilities 52,197 55,658 ---------- ---------- Other long-term liabilities 10,400 9,545 ---------- ---------- SHAREHOLDERS' EQUITY Common stock, net, authorized 100,000,000 shares Issued and outstanding 36,167,625 and 36,450,115 shares 117,575 119,287 Cumulative translation adjustment 862 639 Accumulated deficit (38,040) (38,464) ---------- ---------- Total shareholders' equity 80,397 81,462 ---------- ---------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 142,994 $ 146,665 ========== ==========
See accompanying notes to consolidated financial statements. 2 5 THE SANTA CRUZ OPERATION, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)
Three Months Ended December 31, ------------------------- 1997 1996 -------- -------- (Unaudited) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 424 $ 3,966 Adjustments to reconcile net income to net cash provided by operating activities - Depreciation and amortization 3,879 5,428 Deferred tax assets (51) -- Exchange gain (315) -- Changes in operating assets and liabilities- Receivables 3,478 (4,708) Other current assets 18 1,512 Royalties payable (2,550) (3,216) Trade accounts payable 403 (3,959) Income taxes payable (95) (1,634) Accrued expense and other current liabilities (683) 2,454 Deferred revenue (1,048) (521) -------- -------- Net cash provided by (used for) operating activities 3,460 (678) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (1,364) (2,048) Purchases of software and technology licenses (195) (2,162) Sales of short-term investments 6,630 4,302 Purchases of short-term investments (5,351) (3,734) Changes in other assets 447 (3,873) -------- -------- Net cash provided by (used for) investing activities 167 (7,515) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Payments on capital lease (555) (279) Net proceeds from sale of common stock 72 1,480 Repurchases of common stock (1,784) (5,699) Changes in other long-term liabilities 836 2,289 -------- -------- Net cash used for financing activities (1,431) (2,209) -------- -------- Effects of exchange rate changes on cash and cash equivalents 210 833 -------- -------- Change in cash and cash equivalents 2,406 (9,569) Cash and cash equivalents at beginning of period 23,225 32,065 -------- -------- Cash and cash equivalents at end of period $ 25,631 $ 22,496 -------- -------- SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid- Income taxes $ 231 $ 3,351 Interest 233 57 Non-cash financing and investing activities- Assets recorded under capital leases $ 852 $ 1,080 -------- --------
See accompanying notes to consolidated financial statements. 3 6 THE SANTA CRUZ OPERATION,INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION In the opinion of management, the accompanying unaudited, consolidated statements of operations, balance sheets and statements of cash flows have been prepared in accordance with generally accepted accounting principles and include all material adjustments (consisting of only normal recurring adjustments) necessary for their fair presentation. The financial statements include the accounts of the Company and its wholly owned subsidiaries after all material intercompany balances and transactions have been eliminated. The Notes to Consolidated Financial Statements contained in the fiscal year 1997 report on 10K should be read in conjunction with these Consolidated Financial Statements. The consolidated interim results presented are not necessarily indicative of results to be expected for a full year. Certain reclassifications have been made for consistent presentation. The September 30, 1997 balance sheet was derived from audited financial statements, and is included for comparative purposes. 2. EARNINGS PER SHARE (EPS) DISCLOSURES The Company has adopted the provisions of Statement of Financial Accounting Standards No. 128 (SFAS 128), Earnings Per Share, effective December 31, 1997. SFAS 128 requires the presentation of basic and diluted earnings per share. Basic EPS is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS is computed giving effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares consist of the incremental common shares issuable upon the exercise of stock options for all periods. All prior period earnings per share amounts have been restated to comply with SFAS 128. Basic and diluted earnings per share were calculated as follows during the three months ended December 31, 1997 and 1996:
1997 1996 ------- ------- (in thousands, except per share data) (unaudited) Basic: Weighted average shares 36,345 36,909 ======= ======= Net income $ 424 $ 3,966 ======= ======= Net income per share $ 0.01 $ 0.11 ======= ======= Diluted: Weighted average shares 36,345 36,909 Common equivalent shares from stock options and warrants 749 774 ------- ------- Shares used in per share calculation 37,094 37,683 ======= ======= Net income $ 424 $ 3,966 ======= ======= Net income per share $ 0.01 $ 0.11 ======= =======
Options to purchase 2,587,856 and 3,470,379 shares of common stock at a range of $5.36 to $12.00 and $6.87 to $13.94 per share were outstanding during the first quarter of fiscal year 1998 and 1997, respectively, but were not included in the computation of diluted EPS because the options' exercise price was greater than the average market price of the common shares for each respective quarter. 4 7 3. RECENT ACCOUNTING PRONOUNCEMENTS In October 1997, the AICPA issued Statement of Position (SOP) 97-2, Software Revenue Recognition, which supersedes SOP 91-1. The Company will be required to adopt SOP 97-2 prospectively for software transactions entered into beginning October 1, 1998. SOP 97-2 generally requires revenue earned on software arrangements involving multiple elements such as software products, upgrades, enhancements, postcontract customer support, installation and training, to be allocated to each element based on the relative fair values of the elements. The fair value of an element must be based on evidence which is specific to the vendor. The revenue allocated to software products, including specified upgrades or enhancements generally is recognized upon delivery of the products. The revenue allocated to postcontract customer support generally is recognized ratably over the term of the support and revenue allocated to service elements generally is recognized as the services are performed. If a vendor does not have evidence of the fair value for all elements in a multiple-element arrangement, all revenue from the arrangement is deferred until such evidence exists or until all elements are delivered. The Company's management is currently evaluating whether the adoption of SOP 97-2 will have a material impact on the Company's financial position or results of operations. In June 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 130 (SFAS 130), Reporting Comprehensive Income. This statement establishes requirements for disclosure of comprehensive income and becomes effective for the Company for fiscal years beginning after December 15, 1997, with reclassification of earlier financial statements for comparative purposes. Comprehensive income generally represents all changes in stockholders' equity except those resulting from investments or contributions by stockholders. The Company is evaluating alternative formats for presenting this information, but does not expect this pronouncement to materially impact the Company's results of operations. In June 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 131, (SFAS 131), Disclosures about Segments of an Enterprise and Related Information. This statement establishes standards for disclosure about operating segments in annual financial statements and selected information in interim financial reports. It also establishes standards for related disclosures about products and services, geographic areas and major customers. This statement supersedes Statement of Financial Accounting Standards No. 14, Financial Reporting for Segments of a Business Enterprise. The new standard becomes effective for fiscal years beginning after December 15, 1997, and requires that comparative information from earlier years be restated to conform to the requirements of this standard. The Company is evaluating the requirements of SFAS 131 and the effects, if any, on the Company's current reporting and disclosures. 4. LEGAL PROCEEDINGS In August 1993, a securities class action lawsuit was filed against the Company. In November 1997, the lawsuit was settled for an insignificant amount. The settlement was fully provided for at September 30, 1997. 5 8 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS In addition to historical information contained herein, this Discussion and Analysis may contain forward-looking statements that involve risks and uncertainties. The Company's actual results could differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof. The Company undertakes no obligation to publicly release the results of any revision to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. RESULTS OF OPERATIONS NET REVENUES Net revenues for the three months ended December 31, 1997 decreased 16% to $47.5 million from $56.6 million in the same period in fiscal 1997. This quarter's decline resulted in part from decreased or delayed sales to Asia due to weakened local currency and a delay in recording several large transactions which did not close by December 31,1997. No one customer accounted for more than 10% of net revenues in the first quarter ended December 31, 1997 or 1996. International revenues continue to represent a significant portion of total net revenues comprising 54% of the revenues for the first fiscal quarter of 1998, and 53% for the same quarter in fiscal 1997. COSTS AND EXPENSES Cost of revenues as a percentage of net revenues increased to 26% for the first quarter of fiscal 1998 from 24% in the same period of 1997, principally due to the impact of stable fixed costs over lower unit sales volume. It was mitigated, in part, by a change in the overhead rate allocated to inventory and by the improvement in the cost base due to outsourcing of the Company's distribution function in the fourth quarter of fiscal 1997. Research and development expenses decreased 10% to $10.8 million in the first quarter of fiscal 1998 from $12.0 million in the comparable quarter of fiscal 1997, or 23% and 21% of net revenues, respectively. The absolute spending decrease is primarily attributable to reduced staffing levels initiated with the restructuring of operations in the third quarter of fiscal 1997. Sales and marketing expenses decreased 6% to $19.6 million in the first quarter of fiscal 1998 from $20.8 million for the comparable quarter of the prior year. Sales and marketing expenses represented 41% of net revenues in the first quarter of fiscal 1998 and 37% in 1997. General and administrative expenses decreased 12% to $4.6 million for the first quarter of fiscal 1998 from $5.2 million for the same period of the prior year. General and administrative expenses represented 10% and 9% of net revenues for the first quarter of fiscal 1998 and 1997, respectively. Reduced headcount and lowered discretionary spending resulted in the decline. Other income consists of net interest income, foreign exchange gain and loss as well as other miscellaneous income and expense items. For the first quarter of fiscal 1998, other income was $.6 million compared to $.3 million for the same quarter of fiscal 1997. The increase in other income was due primarily to foreign exchange translation gain in 1998 and loss in 1997 on non-sterling denominated assets in the Company's UK subsidiary. The provision for income taxes was $.3 million for the first quarter of fiscal 1998 compared to $1.3 million for the same period of the prior fiscal year. The tax provision for the first quarter of the current fiscal year resulted from foreign taxes paid. The tax provision for the first quarter of the prior fiscal year reflects taxes provided on operations at an effective tax rate of 25%. The tax provisions for fiscal 1998 and fiscal 1997 reflect the realization of certain deferred tax assets for which a valuation allowance was previously established. Net income for the first quarter of fiscal 1998 was $.4 million compared to $4.0 million for 1997. 6 9 FACTORS THAT MAY AFFECT FUTURE RESULTS The Company's future operating results may be affected by various uncertain trends and factors which are beyond the Company's control. These include adverse changes in general economic conditions and rapid or unexpected changes in the technologies affecting the Company's products. The process of developing new high technology products is complex and uncertain and requires accurate anticipation of customer needs and technological trends. The industry has become increasingly competitive and, accordingly, the Company's results may also be adversely affected by the actions of existing or future competitors, including the development of new technologies, the introduction of new products, and the reduction of prices by such competitors to gain or retain market share. The Company's results of operations could be adversely affected if it were required to lower its prices significantly. The Company participates in a highly dynamic industry and future results could be subject to significant volatility, particularly on a quarterly basis. The Company's revenues and operating results may be unpredictable due to the Company's shipment patterns. The Company operates with little backlog of orders because its products are generally shipped as orders are received. In general, a substantial portion of the Company's revenues have been booked and shipped in the third month of the quarter, with a concentration of these revenues in the latter half of that third month. In addition, the timing of closing of large license contracts and the release of new products and product upgrades increase the risk of quarter to quarter fluctuations and the uncertainty of quarterly operating results. The Company periodically may adjust the level of inventory held in its distribution channels which may also cause quarter-to-quarter fluctuations. The Company's staffing and operating expense levels are based on an operating plan and are relatively fixed throughout the quarter. As a result, if revenues are not realized in the quarter as expected, the Company's expected operating results could be adversely affected, and such effect could be substantial and could result in an operating loss. The Company experiences seasonality of revenues for both the European and the U.S. federal government markets. European revenues during the quarter ending June 30 are historically lower or relatively flat compared to the prior quarter. This reflects a reduction of customer purchases in anticipation of reduced selling activity during the summer months. Sales to the U.S. federal government generally increase during the quarter ending September 30. This seasonal increase is primarily attributable to increased purchasing activity by the U.S. federal government prior to the close of its fiscal year. Additionally, net revenues for the first quarter of the fiscal year are typically lower or relatively flat compared to net revenues of the prior quarter. The overall cost of revenues may be affected by changes in the mix of net revenue contribution between licenses and services, product families, geographical regions and channels of distribution, as the costs associated with these revenues may have substantially different characteristics. The Company may also experience a change in margin as net revenues increase or decrease since technology costs, service costs and production costs are fixed within certain volume ranges. The Company's results of operations could be adversely affected if it were to lower its prices significantly. In the event the Company reduced its prices, the Company's standard terms for selected distributors provide credit for inventory ordered in the previous 180 days, such credits to be applied against future purchases. The Company, as a matter of policy, does not allow product returns for refund. Product returns are generally allowances for stock balancing and are accompanied by compensating and offsetting orders. Revenue is net of a provision for estimated future stock balancing and excess quantities above levels the Company believes are appropriate in its distribution channels. The Company monitors the quantity and mix of its product sales. As the Company determines that it is more likely than not able to utilize its tax carryforwards and other deferred tax assets in the future and as new tax legislation is enacted, the Company's effective tax rate is subject to change. A substantial portion of the Company's revenues are derived from outside the United States. Trade sales to international customers represented 54% and 53% of total revenues for the first quarter of fiscal 1998 and 1997, respectively. A substantial portion of these international revenues are denominated in the U.K. pound sterling and operating results can vary with changes in the U.S. dollar exchange rate for such currency. The Company's revenues can also be affected by general economic conditions in the United States, Europe and other international markets. The Company's operating strategy and pricing take into account changes in exchange rates over time. However, the 7 10 Company's results of operations may be significantly affected in the short term by fluctuations in foreign currency exchange rates. The Company has adopted a strategy of reviewing and forecasting all material foreign denominated assets and liabilities to cover any potential transactional gain or loss which may occur should exchange rates change significantly. The Company may employ hedging instruments to offset uncovered exposure. The Company's policy is to amortize purchased software and technology licenses using the straight-line method over the remaining estimated economic life of the product, or on the ratio of current revenues to total projected product revenues, whichever is greater. Due to competitive pressures, it is reasonably possible that those estimates of anticipated future gross revenues, the remaining estimated economic life of the product, or both will be reduced significantly in the near future. As a result, the carrying amount of the Company's purchased software and technology licenses may be reduced materially in the near future and, therefore, could create an adverse impact on the Company's future reported earnings. The Company continually evaluates potential acquisition candidates. Such candidates are selected based on products or markets which are complementary to those of the Company's. Acquisitions involve a number of special risks, including the successful combination of the companies in an efficient and timely manner, the coordination of research and development and sales efforts, the retention of key personnel, the integration of the acquired products, the diversion of management's attention to assimilation of the operations and personnel of the acquired companies, and the difficulty of presenting a unified corporate image. The Company's operations and financial results could be significantly affected by such an acquisition. The Company's continued success depends to a significant extent on senior management and other key employees. None of these individuals is subject to a long-term employment contract or a non-competition agreement. Competition for qualified people in the software industry is intense. The loss of one or more key employees or the Company's inability to attract and retain other key employees could have a material adverse effect on the Company. The stock market in general, and the market for shares of technology companies in particular, have experienced extreme price fluctuations, which have often been unrelated to the operating performance of the affected companies. In addition, factors such as new product introductions by the Company or its competitors may have a significant impact on the market price of the Company's Common Stock. Furthermore, quarter-to-quarter fluctuations in the Company's results of operations caused by changes in customer demand may have a significant impact on the market price of the Company's stock. These conditions, as well as factors which generally affect the market for stocks of high technology companies, could cause the price of the Company's stock to fluctuate substantially over short periods. LIQUIDITY AND CAPITAL RESOURCES The Company's cash and short-term investments totaled $52.8 million at December 31, 1997, representing 37% of the Company's total assets. The three month increase in cash and short-term investments of $1.1 million was primarily attributable to improved collection of the Company's accounts receivable. At December 31, 1997, the Company had available lines of credit of approximately $17.0 million under which the Company had $0.8 million in outstanding borrowings. The Company believes that its existing cash and short-term investments, funds generated from operations and available borrowing capabilities will be sufficient to meet its operating requirements through at least calendar 1998. The Company's first quarter ended December 31, 1997 Days Sales Outstanding (DSO) was 63.5 days, unchanged from the fourth quarter of fiscal 1997. The Company is engaged in a systematic repurchase of the Company's Common Stock for the funding of its employee programs. Additionally, the Company is authorized to buy back up to 4,000,000 additional shares. As of December 31, 1997, 773,000 shares had been repurchased and retired under this non-systematic program. 8 11 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In August 1993, a securities class action lawsuit was filed against the Company. In November 1997, the lawsuit was settled for an insignificant amount. The settlement was fully provided for at September 30, 1997. ITEM 6. EXHIBITS (a) Exhibits 27. Financial Data Schedule. ITEMS 2, 3, 4 AND 5 ARE NOT APPLICABLE AND HAVE BEEN OMITTED. 12 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. The Santa Cruz Operation, Inc. Date: February 13, 1998 By: /s/ Alok Mohan ------------------------------------- Alok Mohan President and Chief Executive Officer 10 13 EXHIBIT INDEX 27. Financial Data Schedule. 11 EX-27 2 FINANCIAL DATA SCHEDULE
5 1,000 3-MOS SEP-30-1997 OCT-01-1997 DEC-31-1997 25,631 27,207 44,201 (10,710) 2,094 99,968 56,853 (42,773) 142,994 52,197 0 0 0 117,575 (37,178) 80,397 43,861 47,497 8,386 12,346 34,982 0 233 745 321 424 0 0 0 424 0.01 0.01
-----END PRIVACY-ENHANCED MESSAGE-----