SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 8-K
CURRENT REPORT
Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
October 23, 1997
Computervision Corporation
(Exact name of registrant as specified in charter)
Delaware 1-7760/0-20290 04-2491912
- ---------------- -------------- --------------
(State or other (Commission IRS Employer
jurisdiction File Numbers) Identification
of incorporation) Number)
100 Crosby Drive, Bedford, MA 01730
(Address of principal executive offices)
(617) 275-1800
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Item 5. Other Events
- ---------------------
On October 23, 1997, Computervision Corporation issued a
press release announcing its third quarter results (see copy of
press release attached).
Item 7. Financial Statements and Exhibits
- ------------------------------------------
(a) Financial Statements of business acquired:
Not applicable
(b) Pro Forma financial information
Not applicable
(c) Exhibits:
(99) (a) Press Release dated October 23, 1997
SIGNATURE
Pursuant to the requirements of the Securities and Exchange
Act of 1934,the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.
Computervision Corporation
(Registrant)
By /S/ Anthony N. Fiore, Jr.
Anthony N. Fiore, Jr.
Vice President, Business
Operations and General Counsel
Date: October 29, 1997
EXHIBIT INDEX
-------------
Exhibit No. Page. No.
- ------------------------------------------------------------
(99) (a) Press Release dated October 29, 1997 5-13
FOR IMMEDIATE RELEASE
For Further Information:
Gene Bullis
Computervision Corporation
(781) 275-1800, ext. 6241
ebullis@msgate.cv.com
FOR IMMEDIATE RELEASE
Computervision Announces Third Quarter Results
BEDFORD, Mass., October 23, 1997 -- Computervision Corporation
(NYSE:CVN) today announced its financial results for the third quarter
and nine-month period ended September 28, 1997.
For the third quarter, Computervision posted total revenue of$51.1 million,
which included $42.2 million from its software business as previously
announced and $8.9 million from the hardware services business sold to CVSI,
Inc. during the quarter. This compares to revenue of $81.8 million from the
software business and $41.4 million from the hardware services business in
the same quarter last year. Software revenue for the prior year period
included a $27 million software order from a major customer.
Third quarter operating expenses for the software business were $31.4
million, down 20 percent compared to the third quarter of 1996. The net
loss for the quarter was $17.6 million or $0.28 per share versus net income
of $13.1 million or $0.20 per share in the third quarter of 1996.
For the nine months ended September 28, 1997, Computervision's total revenue
was $217.4 million, compared with $355.4 million in the first nine months of
1996. Software business revenue was $135.1 million compared to $222.1
million in the prior year period. The net loss for the nine months ended
September 28, 1997, before non-recurring charges was $59.3 million or $0.93
per share versus net income of $31.9 million or $0.49 per share for the same
period last year. During the first nine months of 1997, the company recorded
non-recurring charges of $52 million, which were related to actions taken
to improve the operating efficiency of the software business and the
separation of the CVSI business. After non-recurring charges, the net loss
for the 1997 period was $111.3 million or $1.75 per share.
Computervision president and chief executive officer Kathleen A. Cote said:
"The third quarter is traditionally a weak quarter for the Company. However,
in the quarter we continued to focus on the restructuring previously
announced. We have more work to do and expect to achieve further cost
reductions as we complete our restructuring initiatives.
"From a product point of view, we were pleased that during the quarter a
number of corporations continued to make commitments to Computervision's
technology including Hughes Space and Communications, Vickers Shipbuilding
and Engineering, Fiat, Toshiba, Mabuchi Motor, Daihatsu Kogyo, Kansei, Rohr
Industries, and Bosch Siemens," Cote continued.
As announced on October 16, 1997, the Company is making progress towards
the establishment of a new credit arrangement. A $14.5 million bridge
credit facility was closed with Foothill Capital Corporation on October 16,
1997, with a portion of the facility being used to repay an existing $8.5
million bridge loan. The new facility currently being negotiated with
Foothill is expected to provide the Company with a $47.5 million credit
facility at which time the bridge facility will be repaid.
Company Background
- ------------------
Computervision Corporation is the leading international supplier of
Electronic Product Definition (EPD) solutions. EPD is Computervision's
product and process response to the customer need to concurrently create,
manage, share and reuse electronic product information in a collaborative
environment throughout a product's life cycle and across a distributed value
chain. Computervision is headquartered in Bedford, Massachusetts.
Except for the historical information contained herein, matters
discussed in this news release may constitute forward-looking
statements that involve risks and uncertainties that could cause
actual results to differ materially from those projected. These
include the ability of the Company to complete its credit facility. The
Company also directs the reader to those risks and uncertainties that are
detailed from time to time in reports filed by Computervision with the
Securities and Exchange Commission, including the Company's most recent
reports on Form 10-K and 10-Q.
Computervision and the Computervision logo are registered trademarks of
Computervision Corporation. Electronic Product Definition, and EPD are
trademarks of Computervision Corporation. All other trademarks are
trademarks of their respective owners.
A copy of this release plus financial, product and other company
information is available by dialing 1-800-546-4616. Any questions
concerning the service should be directed to Investor Relations at
Computervision Corporation at 781/275-1800. For more information
on Computervision, please call (781) 275-1800 or visit the
Computervision web site at http://www.cv.com.
FINANCIAL HIGHLIGHTS
(In millions, except per share data)
Three Months Ended Nine Months Ended
------------------ -----------------
9/29/96 9/28/97 9/29/96 9/28/97
------- ------- ------- -------
Total software revenue $81.8 $42.2 $222.1 $135.1
Other services revenue $41.4 $8.9 $133.3 $82.2
Total revenue $123.2 $51.1 $355.4 $217.3
Non-recurring charge -
Software $0.0 $0.0 $0.0 $45.0
Non-recurring charge -
other services $0.0 $0.0 $0.0 $7.0
Operating income (loss) -
Software $22.1 ($6.8) $46.8 ($74.3)
Operating income (loss) -
other services $0.7 ($1.9) $12.5 ($11.8)
Total operating income
(loss) $22.8 ($8.7) $59.3 ($86.1)
Net income (loss) $13.1 ($17.6) $31.9 ($111.3)
Net income (loss)
per share $0.20 ($0.28) $0.49 ($1.75)
Weighted average shares
Outstanding 64.5 63.7 64.8 63.6
Total shares outstanding,
end of period 63.4 63.7 63.4 63.7
- --------------------------------------------------------------
COMPUTERVISION CORPORATION
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
(Unaudited)
ASSETS 12/31/96 9/28/97
- --------------------------------------------------------------
CURRENT ASSETS
Cash and cash equivalents $38,565 $25,948
Accounts receivable, less
allowance for doubtful accounts
of $2,929 and $2,845, respectively 102,509 48,465
Current deferred income taxes 7,448 7,091
Prepaid expenses and other current
Assets 16,019 12,775
------- ------
TOTAL CURRENT ASSETS 164,541 94,279
PROPERTY AND EQUIPMENT, NET 31,055 10,007
DEFERRED INCOME TAX ASSETS 4,113 3,101
CAPITALIZED SOFTWARE 1,276 3,284
DEFERRED FINANCE COSTS 3,734 1,915
OTHER ASSETS 3,626 4,092
-------- --------
$208,345 $116,678
-------- --------
LIABILITIES AND STOCKHOLDERS' DEFICIT
- -------------------------------------
CURRENT LIABILITIES
Accounts payable $19,776 $29,255
Notes payable and current portion
of long-term debt 9,888 18,379
Accrued compensation, severance
and related costs 57,482 55,563
Deferred revenue and customer
Advances 40,503 31,661
Accrued and deferred income taxes 15,019 16,272
Other current liabilities and
accrued expenses 81,822 89,315
------- -------
TOTAL CURRENT LIABILITIES 224,490 240,445
------- -------
DEFERRED INCOME TAXES 30,174 29,851
LONG-TERM DEBT, LESS CURRENT PORTION 217,346 217,383
OTHER LONG-TERM LIABILITIES 53,110 57,557
STOCKHOLDERS' DEFICIT
Preferred stock, $0.01 par value;
5,000,000 shares authorized; none
issued and outstanding
Common stock, $0.01 par value;
100,000,000 shares authorized;
63,509,999 and 63,701,315 shares,
respectively, issued and outstanding 635 637
Capital in excess of par value 1,186,109 ,186,762
Retained deficit (1,511,148)(1,622,498)
Cumulative translation adjustment 7,629 6,541
---------- ---------
TOTAL STOCKHOLDERS' DEFICIT (316,775)(428,558)
---------- --------
$208,345 $116,678
---------- --------
- -----------------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Thousands, Except Per Share Data)
Three Months Ended Nine Months Ended
------------------ -----------------
9/29/96 9/28/97 9/29/96 9/28/97
-------- ------- ------- -------
SOFTWARE REVENUE
Product................. $55,028 $18,637 $138,918 $61,886
Services.................. 26,783 23,551 83,220 73,251
------- ------- -------- -------
Total Software Revenue.. 81,811 42,188 222,138 135,137
OTHER SERVICES REVENUE...... 41,442 8,889 133,307 82,224
-------- ------ -------- -------
Total Revenue......... 123,253 51,077 355,445 217,361
COST OF SALES
Software
Product............... 4,092 3,017 11,828 9,150
Services............... 16,278 14,538 48,362 47,603
Other Services............ 34,969 9,293 102,607 74,807
------- ------ -------- ------
Total Cost of Sales..... 55,339 26,848 162,797 131,560
-------- ------- -------- -------
GROSS PROFIT................ 67,914 24,229 192,648 85,801
SELLING AND ADMINISTRATIVE EXPENSE
Software.................. 29,721 21,489 85,156 77,875
Other Services............ 5,643 1,345 17,651 11,788
RESEARCH, DEVELOPMENT AND
ENGINEERING EXPENSE
Software.................. 9,622 9,930 30,012 29,827
Other Services.......... 175 131 525 400
NON-RECURRING CHARGES
Software.................. 0 0 0 45,000
Other Services............ 0 0 0 7,000
------ ------ ------ ------
OPERATING INCOME (LOSS)
Software.................. 22,098 (6,786) 46,780 (74,318)
Other Services............ 655 (1,880) 12,524 (11,771)
------ ------- ------ -------
Total Operating
Income (Loss)........ 22,753 (8,666) 59,304 (86,089)
INTEREST AND OTHER
EXPENSE, NET.............. 7,874 8,936 23,040 25,225
------ ------ ------ -------
INCOME (LOSS) BEFORE
INCOME TAXES.............. 14,879 (17,602) 36,264 (111,314)
PROVISION FOR INCOME TAXES.. 1,785 -- 4,349 --
------ ------ ------ -------
NET INCOME (LOSS)......... $13,094 ($17,602) $31,915($111,314)
------- ------- ------- -------
EARNINGS (LOSS) PER SHARE... $0.20 ($0.28) $0.49 ($1.75)
WEIGHTED AVERAGE
SHARES OUTSTANDING...... 64,478 63,701 64,782 63,614
------ ------ ------ ------
- -----------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In Thousands)
Nine Months Ended
--------------------
9/29/96 9/28/96
CASH FLOWS FROM (USED FOR) OPERATIONS ------- -------
Net income.(Loss).................... $31,915 ($111,314)
Add items not requiring cash:
Depreciation of property and
equipment....................... 16,037 10,235
Amortization of intangibles....... 1,482 584
Amortization of finance costs and
debt discounts.................. 2,185 2,797
Provision for doubtful accounts... (31) 65
Non-cash portion of non-recurring
charge 0 6,634
Gain on sale of CVSI... .......... 0 (1,255)
Changes in assets and liabilities:
Accounts receivable............... (23,180) 47,612
Prepaid expenses and other........ (3,228) 1,680
Accounts payable, accrued expenses
and income taxes................ (45,267) 1,709
-------- -----
Cash flows used for continuing
operations...................... (20,087) (41,253)
-------- -------
INVESTING ACTIVITIES
Expenditures for property and
equipment....................... (7,929) (6,387)
Net proceeds from sale of CVSI...... 0 30,100
(Increase) decrease in other assets... 464 (989)
Acquisition....................... 0 (1,600)
------ ------
Total cash flows used for
Investments................... (7,465) 21,124
------ ------
FINANCING ACTIVITIES
Increase in notes payable......... 260 8,368
Payments on long-term borrowings.. (1,615) (818)
Issuance of Common Stock under
Employee Stock Purchase Plan.... 308 173
Issuance of Common Stock under Stock
Option Plan..................... 2,248 482
------ -----
Total cash from financing activities. 1,201 8,205
------ ------
Foreign exchange impact on cash.... (1,141) (693)
------ ----
Net decrease in cash and
cash equivalents................ (27,492) (12,617)
Cash and cash equivalents at beginning
of period....................... 50,979 38,565
------ ------
Cash and cash equivalents at end
of period....................... $23,487 $25,948
------- -------
Supplementary data requirements:
Cash interest paid................ $25,271 $21,664
Cash taxes paid................... $625 $1,399