PROGRAMMER'S PARADISE INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL DATA
The unaudited pro forma condensed consolidated statements of
income data is presented as if the Software Developers
Company business was acquired on January 1, 1995 and 1996,
respectively. The unaudited pro forma condensed
consolidated financial data should be read in conjunction
with the Company's consolidated financial statements and the
notes thereto. The pro forma information is not necessarily
indicative of the results that would have been reported had
such events actually occurred on the dates specified, nor is
it indicative of the Company's future results.
Programmer's Paradise, Inc.
Unaudited Pro Forma Condensed Statement of Income
Year ended December 31, 1995
Acquisition
Actual Acquisition(1) Adjustment Pro Forma
Net sales $93,286 $49,556 $142,842
Cost of sales 78,718 40,076 118,794
Gross profit 14,568 9,480 24,048
Selling, general and
administrative expenses 12,342 9,006 (5,096) (2) 16,252
Income from operations 2,226 474 7,796
Interest and other
expenses (income), net (250) 185 (2) (3) (67)
Income before income taxes
and minority interest 2,476 289 7,863
Income tax
(benefit) provision (1,727) 110 1,935 (4) 318
Income from continuing
operations $ 4,203 $ 179 $ 7,545
Income from continuing
operations per
common share $ 1.03 $ 1.84
Average shares outstanding 4,102 4,102
(1) Includes the historical results of operations of
Software Developer's Company business related to The
Programmer's Supershop catalog, inbound and outbound
telemarketing, reseller operations, web site, and SDEV
Germany, for the period from January 1, 1995 to December 31,
1995.
(2) Reflects the anticipated reduction in operating
expenses that would have resulted had the acquisition taken
place on January 1, 1995, offset by the pro forma
amortization of goodwill arising from the acquisition of the
net assets of SDC at that date ($0.6 million). The savings
realized in operating expenses is primarily the result of a
reduced work force of approximately 60 employees ($4.2
million), as well as the consolidation of operating
facilities to New Jersey ($1.5 million).
(3) Reflects the loss of interest income on $11,000,000
acquisition payment at 4% for five months ($183,000), offset
by the elimination of interest expense recorded on the books
of SDC ($185,000).
(4) Reflects additional tax provision, at an effective tax
rate of 38%, on earnings realized from the acquisition
adjustments.
Programmer's Paradise, Inc.
Unaudited Pro Forma Condensed Statement of Income
Six Months ended June 30, 1996
Acquisition
Actual Acquisition(1) Adjustment Pro Forma
Net sales $51,142 $24,355 $75,497
Cost of sales 42,720 20,059 62,779
Gross profit 8,422 4,296 12,718
Selling, general and
administrative expenses 7,790 6,051 (4,074) (2) 9,767
Income from operations 632 (1,755) 2,951
Interest and other
expenses (income), net (287) 71 149 (3) (67)
Income before income taxes
and minority interest 919 (1,826) 3,018
Income tax
(benefit) provision 383 (694) 1,492 (4) 1,181
Income from continuing
operations before
minority operations 536 (1,132) 1,837
Minority interest (233) (233)
Income from continuing
operations $ 769 $(1,132) $ 2,070
Income from continuing
operations per
common share $ .15 $ .40
Average shares outstanding 5,173 5,173
(1) Includes the historical results of operations of
Software Developer's Company business related to The
Programmer's Supershop catalog, inbound and outbound
telemarketing, reseller operations, web site, and SDEV
Germany, for the period from January 1, 1996 to June 30,
1996.
(2) Reflects the anticipated reduction in operating
expenses that would have resulted had the acquisition taken
place on January 1, 1996, offset by the pro forma
amortization of goodwill arising from the acquisition of the
net assets of SDC at that date ($0.3 million). The savings
realized in operating expenses is primarily the result of a
reduced work force of approximately 60 employees ($2.2
million), the consolidation of operating facilities to New
Jersey ($.9 million), and the elimination of expenses
recorded by SDC related to the sale and closing of their
business ($1.3 million).
(3) Reflects the loss of interest income on $11,000,000
acquisition payment at 4% for six months ($220,000), offset
by the elimination of interest expense recorded on the books
of SDC ($71,000).
(4) Reflects additional tax provision, at an effective tax
rate of 38%, on earnings realized from the acquisition
adjustments.