1
UNITED STATES
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 March 31, 1996
_______________________________
Commission File Number 0-26816
IDX SYSTEMS CORPORATION
(Exact name of registrant as specified in its charter)
Vermont 03-0222230
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1400 Shelburne Road
South Burlington, VT 05403
(Address of principal executive offices)
Registrant's telephone number, including area code: (802-862-1022)
Indicate by check mark whether the registrant 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).
Yes X No
Indicate by check mark whether the registrant 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
May 10, 1996 was 20,741,826.
[Exhibit index begins on Page 18]
2
IDX SYSTEMS CORPORATION
FORM 10-Q
For the quarterly Period Ended March 31, 1996
TABLE OF CONTENTS
Page
PART I. FINANCIAL INFORMATION
ITEM 1. Interim Financial Statements:
a) Condensed consolidated balance sheets
as of March 31, 1996 and
December 31, 1995 (unaudited) 3
b) Condensed consolidated statements of
income for the three months ended
March 31, 1996 and 1995 (unaudited 4
c) Condensed consolidated statements
of cash flows for the three months
ended March 31, 1996 and 1995 (unaudited) 5
d) Notes to condensed consolidated
financial statements 7
ITEM 2. Management's discussion and analysis of
financial condition and results of operations 8
PART II. OTHER INFORMATION
ITEM 1. Legal proceedings 16
ITEM 2. Changes in securities 16
ITEM 3. Defaults upon senior securities 16
ITEM 4. Submission of matters to a vote of security holders 16
ITEM 5. Other information 16
ITEM 6. Exhibits and reports on Form 8-K 16
SIGNATURES 17
EXHIBIT INDEX 18
3
Item 1. Interim Financial Statements
IDX SYSTEMS CORPORATION
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
March 31 December 31
1996 1995
---- ----
ASSETS
Cash and cash equivalents $ 19,402 $ 33,262
Securities available-for-sale 56,927 46,514
Accounts receivable, net 33,586 28,013
Other current assets 2,296 2,081
Deferred tax asset 1,535 1,535
------- --------
Total current assets 113,746 111,405
Property and equipment, net 16,267 16,221
Other assets 295 284
Deferred tax asset 501 501
-------- --------
796 785
-------- --------
Total assets $130,809 $128,411
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued
expenses $ 10,616 $ 12,857
Deferred revenue 7,976 7,766
Accrued income taxes 1,319 1,267
-------- --------
Total current liabilities 19,911 21,890
Long term debt 2,907 2,907
Minority interest 1,295 1,182
Stockholders' equity 106,696 102,432
-------- --------
Total liabilities and
stockholders' equity $130,809 $128,411
======== ========
See accompanying notes.
4
Item 1. Interim Financial Statements.
IDX SYSTEMS CORPORATION
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31
1996 1995
---- ----
Revenues
Software license fees $12,428 $ 9,104
Maintenance and service fees 16,780 14,220
Hardware sales 8,137 5,921
------- -------
Total revenues 37,345 29,245
Operating expenses:
Cost of license, maintenance
and service fees 12,779 11,928
Cost of hardware sales 6,612 4,568
Selling, general and
administrative 7,491 5,103
Research and development 5,786 4,289
------- -------
32,668 25,888
------- -------
Operating income 4,677 3,357
Interest and other income 910 254
------- -------
Income before income taxes 5,587 3,611
Income tax provision 2,234 192
------- -------
Net Income $3,353 $3,419
======= =======
Net Income per share $ .16
=======
Historical income before
income taxes $3,611
Pro forma income taxes 1,444
-------
Pro forma net income $2,167
=======
Pro forma net income per share $ .13
=======
Average shares outstanding 21,282 17,269
======= =======
See accompanying notes.
5
Item 1. Interim Financial Statements
IDX SYSTEMS CORPORATION
Condensed Consolidated
Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended
March 31
1996 1995
---- ----
OPERATING ACTIVITIES
Net Income $3,353 $3,419
Adjustments to reconcile net
income to net cash used
in operating activities:
Depreciation 1,123 891
Increase in allowance
for doubtful accounts 29 85
Minority interest 112 (142)
Loss on disposal of property and
equipment 15 164
Changes in operating assets and
liabilities:
Accounts receivable (5,602) (5,052)
Prepaid expenses (327) (35)
Accounts payable (508) (563)
Accrued expenses (1,681) (385)
Deferred revenue 211 1,259
Other, net 111 (224)
------ ------
Net cash used in operating
activities (3,164) (583)
See accompanying notes.
6
INVESTING ACTIVITIES
Purchase of property and
equipment $(1,186) $(959)
Proceeds from sale of property
and equipment 4 42
Purchase of securities available-
for-sale (20,989) 151
Sale of securities available-
for-sale 10,443 100
------- -------
Net cash used in investing
activities (11,728) (666)
FINANCING ACTIVITIES
Proceeds from sale of
common stock 1,032 182
Issuance of notes receivable
to related parties 512
Proceeds from related parties 692
Payments on long-term debt
related to real estate (474)
------- --------
Net cash provided by financing
activities 1,032 912
======== ========
Decrease in cash and cash
equivalents (13,860) (337)
Cash and cash equivalents at
beginning of period 33,262 6,460
------- --------
Cash and cash equivalents at
end of period $19,402 $6,123
======= ========
See accompanying notes.
7
Notes to Condensed Consolidated Financial Statements
Note 1 - Interim Statement Presentation
The unaudited consolidated financial statements have been prepared by the
Company pursuant to the rules and regulations of the Securities and Exchange
Commission and in accordance with generally accepted accounting principles.
Accordingly, certain information and footnote disclosures normally included
in annual financial statements have been omitted or condensed. In the
opinion of management, all necessary adjustments have been made to provide
a fair presentation. The operating results for the three months ended
March 31, 1996 are not necessarily indicative of the results that may be
expected for the year ending December 31, 1996. For further information,
refer to the consolidated financial statements and footnotes included in
the Company's latest annual report on Form 10-K.
Note 2 - Pro Forma Net Income and Net Income Per Share Information
Pro forma net income represents actual historical pre-tax earnings in 1995
less the tax provision which the Company would have recognized had it been
taxed as a "C" Corporation in 1995. Prior to October 1, 1995, the Company
was taxed as an "S" Corporation. Pro forma net income per share is computed
using pro forma net income and the weighted average number of Common and
dilutive Common Stock equivalent shares. Common Stock equivalents are
attributable to stock options using the treasury stock method and, for the
three-month period ended March 31, 1995, include the weighted average
estimated number of shares which was necessary to fund the payment of
undistributed S Corporation earnings in excess of the previous twelve months
net income. Common Stock and Common Stock equivalent shares issued during
the twelve-month period prior to the effective date of the initial public
offering have been included in the calculations as if they were outstanding
for the three-month period ended March 31, 1995 using the treasury stock
method. The initial public offering price was used in the determination of
Common Stock equivalents for all periods presented up to the effective date
of the initial public offering. After that date, the market prices of Common
Stock were used for computing Common Stock equivalents. Primary and fully
diluted pro forma net income per share are the same for the three-month
period ended March 31, 1995 and primary and fully diluted net income per
share are the same for the three-month period ended March 31, 1996.
Note 3 - Reclassifications
Certain prior period amounts have been reclassified to conform with
current period presentations.
8
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
- - ---------------------
REVENUES
The Company's total revenues increased to $37.3 million in the first three
months of 1996 from $29.2 million in the corresponding period in 1995, an
increase of $8.1 million or 27.7%. Revenues from software license fees
increased to $12.4 million in the first three months of 1996 (33.3% of
total revenues) from $9.1 million (31.1% of total revenues) in the
corresponding period in 1995, an increase of $3.3 million or 36.5%. The
increase was primarily due to an increase in installations of certain of the
Company's software products from its Ambulatory Suite and Group Practice
Management software. Revenues from maintenance and service fees increased
to $16.8 million in the first three months of 1996 (44.9% of total revenues)
from $14.2 million (48.6% of total revenues) in the corresponding period in
1995, an increase of $2.6 million or 18.0%. The majority of the increase was
due to additional maintenance revenues resulting from the continued growth in
the Company's installed client base. Hardware revenues increased to $8.1
million in the first three months of 1996 (21.8%) of total revenues)
from $5.9 million (20.3% of total revenues) in the corresponding period
in 1995, an increase of $2.2 million or 37.4%. The increase in hardware
revenues was principally due to customers upgrading their hardware systems.
COST OF LICENSE, MAINTENANCE AND SERVICE FEES
The cost of license, maintenance and service fees increased to $12.8
million in the first three months of 1996 from $11.9 million in the
corresponding period in 1995, an increase of $0.9 million or 7.1%.
The gross profit margin on license, maintenance and service fees increased
to 56.2% in the first three months of 1996 from 48.9% in the corresponding
period in 1995. The increase in gross profit margin was principally due to
the growth in software revenue without a corresponding increase in related
costs due to the fixed nature of a significant portion of the Company's
revenue-related costs.
COST OF HARDWARE SALES
The cost of hardware sales increased to $6.6 million in the first three
months of 1996 from $4.6 million in the corresponding period in 1995, an
increase of $2.0 million or 44.7%. The gross profit margin on hardware
sales decreased to 18.7% of hardware revenues in the three months
ended March 31, 1996, from 22.9% in the corresponding period in 1995.
The decrease was generally due to price reductions on hardware in the
marketplace.
9
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses increased to $7.5 million in
the first three months of 1996 from $5.1 million in the corresponding
period in 1995, an increase of $2.4 million or 46.8%. As a percentage of
total revenues, selling, general and administrative expenses increased to
20.1% in the first three months of 1996 from 17.4% in the corresponding
period in 1995. Approximately $1.2 million of those expenses in the first
three months of 1996 were due to a 40% increase in the Company's sales and
marketing staff over the same period in 1995.
RESEARCH AND DEVELOPMENT
Research and development expenses increased to $5.8 million in the first
three months of 1996 from $4.3 million in the corresponding period in 1995,
an increase of $1.5 million or 34.9%. The increase was due to an increase of
staff to support the development of additional products for
the Company's Care Management and Enterprise suites. As a percentage of
total revenues, research and development expenses increased to 15.5% in the
first three months of 1996 from 14.7% in the corresponding period in 1995.
LIQUIDITY AND CAPITAL RESOURCES
Since its inception in 1969, the Company has funded its operations,
working capital needs and capital expenditures primarily from operations.
Cash flows from operations are principally comprised of net income and
depreciation and are primarily affected by the net effect of the change
in accounts receivable, deferred revenue, accounts payable and accrued
expenses. Accounts receivable from customers have been collected
consistently in the 65 to 80 day range.
Cash and cash equivalents at March 31, 1996 were $19.4 million, a decrease
of $13.9 million from December 31, 1995. The majority of the decrease was
due to the continued investing of proceeds in investment grade securities
from the Company's initial public offering of common stock which was
consummated on November 22, 1995.
The Company has a revolving line of credit with a bank allowing the Company
to borrow up to $2.0 million bearing interest at the prime rate. There were
no borrowings as of March 31, 1996.
The Company has no significant commitments for capital expenditures at this
time.
10
INCOME TAXES
From July 1, 1987 to November 1, 1995, the Company was treated for federal
and certain state income tax purposes as an S Corporation under the Internal
Revenue Code of 1986, as amended (the "Code"). As a result, the Company's
stockholders, rather than the Company, were required to pay federal and
certain state income taxes based upon the Company's earnings whether or not
the earnings were distributed to such stockholders. On November 1, 1995,
the Company terminated its S corporation status and, accordingly, has become
subject to federal and state income taxes.
For purposes of financial statement presentations, the Company's financial
statements reflect pro forma financial information for 1995 as if the
Company had been taxed as a C corporation. For the quarter ended
March 31, 1996, the Company provided for taxes at a rate of approximately
40% of pre-tax income.
FACTORS AFFECTING FUTURE RESULTS
This report, and other reports, proxy statements and other communications
to stockholders, as well as oral statements made by the Company's officers
or its agents, may contain forward-looking statements with respect to,
among other things, the Company's future revenues, operating income, earnings
per share, or plans and objectives of management, including plans or objectives
relating to products or services of the Company. There are a number of
factors of which the Company is aware that may cause the Company's actual
results to vary materially from those forecast or projected in any such
forward-looking statement. The following are certain, but not necessarily all,
of the factors which the management of the Company presently believes could
cause the Company's actual operating results to be materially less than
forecast or projected in any forward-looking statement.
The Company's revenues and operating results can vary significantly from
quarter to quarter as a result of a number of factors, including the volume
and timing of systems sales and installations, and length of sales cycles and
installation efforts. The timing of revenues from systems sales is difficult
to forecast because the Company's sales cycle can vary depending upon factors
such as the size of the transaction, the changing business plans of its
customers, and general economic conditions. In addition, because revenue is
recognized at various points during the installation process, the timing of
revenue recognition varies considerably based on a number of factors, including
availability of personnel, availability of client resources and complexity of
the needs of the client organization. The Company's initial contact with a
potential customer depends in significant part on the customer's decision to
replace, or substantially modify, its existing information systems. How and
when to implement, replace or substantially modify an information
system are major decisions for health care organizations. Accordingly,
the sales cycle for the Company's systems is typically three to 18 months or
more than from initial contact to
11
contract execution, and the installation cycle is typically three to 18
months or more from contract execution to completion of installation.
During the sales cycle, the Company expends substantial time, effort and
funds preparing contract proposals and negotiating the contract. Because
a significant percentage of the Company's expenses are relatively fixed, a
variation in the timing of systems sales and installations can cause
significant variations in operating results from quarter to quarter.
The Company's future operating results may fluctuate as a result of these
and other factors, such as customer purchasing patterns, and the timing of
new product and service introductions and product upgrade releases.
The Company's revenues have historically followed seasonal patterns with a
lower level of sales and installations occurring in the fiscal quarter ending
September 30 and a greater level of sales and installations occurring in the
fiscal quarter ending June 30 (formerly the fiscal year end of the Company).
The Company believes that such seasonal fluctuation is attributable to a
number of factors, including the Company's former sales and installation
compensation program, which was formerly based significantly on fiscal year
sales and installation goals, and the holiday schedules of its clients.
In 1995, the Company changed its fiscal year end from June 30 to December 31.
The Company is not able to predict what impact, if any, the change will have
on the seasonality of the Company's business. The Company believes that
quarterly results of operations will continue to be subject to significant
fluctuations and that its results of operations for any particular quarter or
fiscal year may not be indicative of results of operations for future periods.
There can be no assurance that future seasonal and quarterly fluctuations will
continue and will not have a material adverse effect on the Company's results
of operations, financial condition or business.
As a developer of information systems, the Company must aniticpate and adapt to
evolving industry standards and new technological developments. The market for
the Company's products is characterized by continued and rapid technological
advances in both hardware and software development, requiring ongoing
expenditures for research and development and the timely introduction of new
products and enhancements to existing products. The establishment of standards
is largely a function of user acceptance. Therefore, such standards are subject
to change. The Company's future success will depend in part upon its ability to
enhance its existing products, to respond effectively to technology changes, to
migrate its clients to new technologies, to sell additional products to its
existing client base and to introduce new products and technologies to meet
the evolving needs of its clients in the health care information systems
market. The Company is currently devoting significant resources toward the
development of enhancements to its existing products and the migration of
existing products to new hardware and software platforms. There can be no
assurance that the Company will successfully complete the development of
these products or this migration in a timely fashion or that the Company's
current or future products will satisfy the needs of the health
care information systems market. Further, there can be no assurance that
products or technologies developed by others will not adversely affect the
Compamy's competitive position or render its products or technologies
noncompetitive or obsolete.
12
Health care providers demand the highest level of reliability and quality from
their information systems. The Company devotes substantial resources to meet
these demands in developing its software. The Company's products may, from
time to time, contain undetected errors or bugs. Errors or bugs in software
products may result in loss of, or delay in, market acceptance of the products.
Delays or difficulties associated with new product introductions or product
enhancements could have a material adverse effect on the Company's results of
operations, financial condition or business.
The Company currently derives a significant percentage of its revenues from
sales of financial and administrative information systems and related
services. As a result, any factor adversely affecting sales of these
products and services could have a material adverse effect on the
Company's results of operations, financial condition or business.
Although the Company has experienced increasing annual sales, revenues
associated with existing products may decline as a result of several factors,
including price competition. There can be no assurance that the Company will
continue to be successful in marketing its current products or any new or
enhanced products or maintaining the current pricing for its existing products.
The market for health care information systems is highly competitive. The
Company's competitors vary in size, and in the scope and breadth of the
products and services which they offer. The Company competes with different
companies in each of its target markets. Many of the Company's competitors
have greater financial, development, technical, marketing and sales resources
than the Company. In addition, other entities not currently offering
products and services similar to those offered by the Company, including
claims processing organizations, hospitals, third-party administrators,
insurers, healthcare organizations and others, may enter certain markets in
which the Company competes. There can be no assurance that future
competition will not have a material adverse effect on the Company's results
of operations, financial condition or business. There can also be no
assurance that the Company will be able to compete successfully in the future.
Certain of the Company's products provide applications that relate to patient
medical histories and treatment plans. Any failure by the Company's products
to provide accurate and timely information could result in product liability
claims against the Company by its clients or their affiliates or patients.
The Company maintains insurance that it believes is adequate to protect
against claims associated with the use of its products, but there can be no
assurance that its insurance coverage would adequately cover any claim
asserted against the Company. A successful claim brought against the Company
in excess of its insurance coverage could have a material adverse effect on
the Company's results of operations, financial condition or business. Even
unsuccessful claims could result in the expenditure of funds in litigation,
as well as diversion of management time and resources. There can be no
assurance that the Company will not be subject to product liability claims,
that such claims will not result in liability in excess of its insurance
coverage or that the Company's insurance will cover such claims or that
appropriate insurance will continue to be available to the Company in the
future at commercially reasonable rates.
13
The success of the Company is dependent to a signifcant degree on its key
management, sales and marketing, and technical personnel. The Company
believes that its continued future success will also depend upon its ability
to attract, motivate and retain highly skilled, managerial, sales and
marketing, and technical personnel, including software programmers and systems
architects skilled in the computer languages in which the Company's products
operate. Competition for personnel in the software and information services
industries is intense. The loss of key personnel, or the inability to hire or
retain qualified personnel, could have a material adverse effect on the
Company's results of operations, financial condition or business. Although
the Company has been successful to date in attracting and retaining skilled
personnel, there can be no assurance that the Company will continue to be
successful in attracting and retaining the personnel it requires to
successfully develop new and enhanced products and to continue to grow
and operate profitably.
The Company's success is dependent to a significant extent on its ability to
maintain the confidentiality of the software incorporated in its current
products and other products as they are released. The Company depends upon a
combination of trade secret, copyright and trademark laws, license
agreements, nondisclosure and other contractual provisions and various
security measures to protect its proprietary rights in its products. The
Company distributes its products under software license agreements which
grant clients a nonexclusive license to the Company's products and
contain terms and conditions prohibiting the unauthorized reproduction
or transfer of the Company's products. In addition, the Company
attempts to protect its trade secrets and other proprietary information
through agreements with employees and consultants. The Company also seeks to
protect the source code of its products as an unpublished copyright work.
There can be no assurance that the legal protections afforded to the Company
or the precautions taken by the Company will be adequate to prevent
misappropriation of the Company's technology. In addition, these protections
do not prevent independent third-party development of functionally equivalent
or superior technologies, products or services. Any infringement or
misappropriation of the Company's proprietary software would disadvantage
the Company in its efforts to retain and attract new clients in a highly
competitive market and could cause the Company to lose revenues or
incur substantial litigation expense. Although the Compay believes that its
products, trademarks and other proprietary rights do not infringe upon the
proprietary rights of third parties, there can be no assurance that third
parties will not assert infringement claims against the Company in the future
and that such claims will not have a material adverse effect on the Company's
results of operations, financial condition or business.
The health care industry in the United States is subject to changing political,
economic and regulatory influences that may affect the procurement practices
and operations of health care organizations. The Company's products are
designed to function within the structure of the health care financing and
reimbursement system currently being used in the United States. During the past
several years, the health care industry has been subject to increasing levels
of governmental regulation of, among other things, reimbursement rates and
certain capital expenditures. From time to time, certain proposals to reform
the health care system have been considered by Congress. These proposals, if
enacted, may increase government involvement
14
in health care, lower reimbursement rates and otherwise change the operating
environment for the Company's clients. Healthcare organizations may react
to these proposals and the uncertainty surrounding such proposals
by curtailing or deferring investments, including those for the
the Company's products and services. The Company cannot predict with
any certainty what impact, if any, such proposals or health care reforms might
have on its results of operations, financial condition or business.
The U.S. Food and Drug Administration (the "FDA") has promulgated a draft
policy for the regulation of certain computer products as medical devices
under the 1976 Medical Device Amendments to the Federal Food, Drug and
Cosmetic Act (the "FDC Act") and has recently indicated an interest in
modifying such draft policy. To the extent that computer software is a
medical device under the policy, the manufacturers of such products could
be required, depending on the product, to (i) register and list their products
with the FDA, (ii) notify the FDA and demonstrate substantial equivalence
to other products on the market before marketing such products, or (iii)
obtain FDA approval by demonstrating safety and effectiveness before
marketing a product. In addition, such products would be subject to the FDC
Act's general controls, including those relating to good manufacturing
practices and adverse experience reporting. Although it is not possible to
anticipate the final form of the FDA's policy with regard to computer software,
the Company expects that, whether or not the draft is finalized or changed,
the FDA is likely to become increasingly active in regulating computer
software that is intended for use in health care settings. The FDA, if it
chooses to regulate such software, can impose extensive requirements
governing pre- and post-market conditions such as device investigation,
approval, labeling and manufacturing. There can be no assurance that such
proposed changes, if adopted, will not have a material adverse effect on the
Company's results of operations, financial condition or business.
The Company intends to continue to grow in part through acquisitions of
complementary products, technologies and businesses or alliances with
complimentary businesses. The Company's ability to expand successfully
through acquisitions or alliances depends on many factors, including
the successful identification and acquisition of products, technologies or
businesses and management's ability to effectively integrate and operate
the acquired or aligned products, technologies or businesses. There is
significant competition for acquisition and alliance opportunities in the
health care information systems industry, which may intensify due to
consolidation in the industry, thereby increasing the costs of capitalizing
on such opportunities. The Company competes for acquisition and alliance
opportunities with other companies that have significantly greater financial
and management resources. There can be no assurance that the Company will be
successful in acquiring or aligning with any complementary products,
technologies or businesses; or, if acquired or aligning with, that the
Company will be able to successfully integrate any such products,
technologies or businesses into its current business and operations. The
failure to successfully integrate any significant products, technologies or
businesses could have a materal adverse effect on the Company's results
of operations, financial condition or business.
15
Market prices for securities of companies such as the Company are highly
volatile. Factors such as announcements of technological innovations or new
products or services by the Company or its competitors, proprietary rights
developments and market conditions for health care or technology stocks in
general could have a significant impact on the future market price of the
Company's Common Stock.
Because of these and other factors, past financial performance should not be
considered an indicator of future performance. Investors should not use
historical trends to anticipate future results.
16
Item 1. LEGAL PROCEEDINGS
None.
Item 2. CHANGES IN SECURITIES
None.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
Item 5. OTHER INFORMATION
None.
Item 6. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) The exhibits filed as part of this Form 10-Q are listed on
the exhibit Index immediately preceding such exhibits, which Exhibt Index
is incorporated herein by reference.
(b) No Current Reports on Form 8-K were filed by the Company
during the last quarter of the period covered by this report.
17
Signatures
Pursuant to the requirement 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.
IDX SYSTEMS CORPORATION
Date: May 13, 1996 /s/JOHN A. KANE
------------------------------------
John A. Kane,
Vice President, Finance and
Administration, Chief Financial
Officer and Treasurer
(Principal Financial and
Accounting Officer)
18
Exhibit Index
The following exhibits are filed as part of this Quarterly Report on
Form 10-Q:
Exhibit No. Description Page
11 Statement regarding computation of
per share earnings. 19
19
EXHIBIT 11
IDX SYSTEMS CORPORATION
Schedules of Net Income Per Share and
Pro Forma Net Income Per Share
(in thousands, except for per share data)
Primary Fully Diluted
------------------ ------------------
Three Months Ended Three Months Ended
March 31 March 31
1996 1995 1996 1995
------------------ ------------------
Weighted average shares
outstanding 20,409 13,903 20,409 13,903
Net dilutive effect of
stock options-based
on the treasury stock
method using the IPO
price until the
effective date and
average price there-
after for primary and
ending price, if higher
for fully diluted 873 1,387 873 1,387
Effect of final S
corporation distribution 1,789 1,789
Effect of common and common
stock equivalent shares
issued by the Company
during the twelve
month period immediately
preceding the Company's
initial public offering
in November 1995, as if
they were outstanding for
all periods presented
prior to the initial
public offering, using
the treasury stock method,
as described above 190 190
-------------------- ---------------------
Total shares 21,282 7,269 21,282 17,269
==================== ====================
Net income $3,353 $3,353
===== =====
Net income per share $ .16 $ .16
===== =====
Pro forma net income $2,167 $2,167
===== =====
Pro forma net income per share $ .13 $ .13
===== =====