EXHIBIT V
INTERNATIONAL BUSINESS MACHINES CORPORATION
AND SUBSIDIARY COMPANIES
ADDITIONAL EXHIBITS
A supplemental Consolidated Statement of Earnings schedule has been provided
for informational purposes only, to exclude the effects of a $435 million
non-recurring, non-tax deductible charge for purchased in-process research and
development in connection with the Tivoli Systems, Inc. and Object Technology
International, Inc. acquisitions in March, 1996. The 1995 results also exclude
the effects of the third quarter charge of $1,840 million for purchased
in-process research and development in connection with the Lotus Development
Corporation acquisition. This supplemental statement is shown in Exhibit V(a).
These charges are discussed on pages 54 and 55 of IBM's 1996 Annual Report
to Stockholders.
EXHIBIT V(A)
INTERNATIONAL BUSINESS MACHINES CORPORATION
AND SUBSIDIARY COMPANIES
SUPPLEMENTAL CONSOLIDATED STATEMENT OF EARNINGS*
1996 AND 1995
(UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) 1996 1995
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Revenue:
Hardware sales............................................................................ $ 36,316 $ 35,600
Services ................................................................................. 15,873 12,714
Software.................................................................................. 13,052 12,657
Maintenance............................................................................... 6,981 7,409
Rentals and financing .................................................................... 3,725 3,560
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Total revenue............................................................................... 75,947 71,940
Cost:
Hardware sales............................................................................ 23,396 21,863
Services ................................................................................. 12,647 10,041
Software.................................................................................. 4,082 4,428
Maintenance............................................................................... 3,659 3,652
Rentals and financing .................................................................... 1,624 1,589
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Total cost.................................................................................. 45,408 41,573
Gross profit................................................................................ 30,539 30,367
Operating expenses:
Selling, general and administrative....................................................... 16,854 16,766
Research, development and engineering..................................................... 4,654 4,170
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Total operating expenses.................................................................... 21,508 20,936
Operating income............................................................................ 9,031 9,431
Other income, principally interest.......................................................... 707 947
Interest expense............................................................................ 716 725
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Earnings before income taxes................................................................ 9,022 9,653
Provision for income taxes ................................................................. 3,158 3,635
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Net earnings ............................................................................... 5,864 6,018
Preferred stock dividends and transaction costs ............................................ 20 62
Net earnings applicable to common shareholders.............................................. $ 5,844 $ 5,956
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Net earnings per share common stock......................................................... $ 11.06 $ 10.46
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Average number of common shares outstanding (millions) ..................................... 528.4 569.4
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* See text in Exhibit V