SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
PLANNING SCIENCES INTERNATIONAL PLC
Tuition House
St George's Road
Wimbledon
London SW19 4EU
United Kingdom
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
----- ---------
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
--------- -----
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
82- N.A.
Page 1 of 13 Pages
Exhibit Index Appears on Page 10
PLANNING SCIENCES INTERNATIONAL PLC
Form 6-K
TABLE OF CONTENTS
Page
Financial Information:
Condensed Consolidated Balance Sheets as of March 31, 1997 and
and December 31, 1996 (Unaudited) 3
Condensed Consolidated Statements of Income for the three months
ended March 31, 1997 and 1996 (Unaudited) 4
Condensed Consolidated Statements of Cash Flows for the three months
ended March 31, 1997 and 1996 (Unaudited) 5
Notes to Condensed Consolidated Financial Statements (Unaudited) 6
Management's Discussion and Analysis of Financial Condition and Results of Operations. 7
Exhibit Index 10
Exhibit A. First Quarter Press Release 11
PLANNING SCIENCES INTERNATIONAL PLC
Condensed Consolidated Balance Sheets
(Unaudited)
March 31, 1997 December 31, 1996
-------------------- ----------------------
(in thousands)
US$ US$
Assets
Current assets:
Cash and cash equivalents $23,207 $25,228
........................................................................
Accounts receivable, net of allowance $454
(Dec 31,1996 - $478) 10,300 9,953
........................................................................
Prepaid expenses and other current assets 914 821
........................................................................
------------- -------------
Total current assets 34,421 36,002
........................................................................
Property and equipment, net 2,177 2,013
........................................................................
Goodwill on acquisition, net of amortization of $210
(Dec 31, 1996 - $122) 3,300 3,388
........................................................................
Deferred taxation 148 148
........................................................................
------------- -------------
Total assets $40,046 $41,551
........................................................................
============= =============
Liabilities and shareholders' equity
Current liabilities:
Current portion of lease obligations $187 $194
........................................................................
Accounts payable 744 1,648
........................................................................
Taxes payable 1,162 1,373
........................................................................
Accrued liabilities 1,345 1,778
........................................................................
Deferred revenues 3,179 2,969
........................................................................
UK value added tax 295 346
........................................................................
Other accounts payable 847 985
........................................................................
------------- -------------
Total current liabilities 7,759 9,293
........................................................................
Non current liabilities:
Deferred taxation 29 29
........................................................................
Long-term portion of lease obligations 210 225
........................................................................
------------- -------------
Total liabilities 7,998 9,547
........................................................................
Shareholder's equity:
Ordinary shares 2,156 2,152
........................................................................
Additional paid-in capital 27,302 27,182
........................................................................
Retained earnings 2,806 2,747
........................................................................
Cumulative translation adjustment (216) (77)
........................................................................
------------- -------------
Total shareholders' equity 32,048 32,004
........................................................................
------------- -------------
Total liabilities and shareholders' equity $40,046 $41,551
........................................................................
============= =============
See accompanying notes
PLANNING SCIENCES INTERNATIONAL PLC
Condensed Consolidated Statement of Operations
(Unaudited)
Three months ended
----------------------------------------------
March 31, 1997 March 31, 1996
-------------------- --------------------
(in thousands, except per share amounts)
US$ US$
Revenues:
License $3,956 $3,313
...................................................................
Services and other 3,045 1,890
...................................................................
------------- -------------
7,001 5,203
------------- -------------
Cost of revenues:
License 167 102
...................................................................
Services and other 1,515 1,032
...................................................................
------------- -------------
1,682 1,134
------------- -------------
Gross profit 5,319 4,069
...................................................................
Operating expenses:
Sales and marketing 3,114 2,067
...................................................................
Research and development 1,215 597
...................................................................
General and administrative 1,117 885
...................................................................
Goodwill amortization 88 -
...................................................................
------------- -------------
Total operating expenses 5,534 3,549
...................................................................
------------- -------------
(Loss) income from operations (215) 520
...................................................................
Other income (expense) 303 (2)
...................................................................
------------- -------------
Income before provision for taxes 88 518
...................................................................
Provision for income taxes 29 192
...................................................................
------------- -------------
Net income $ 59 $ 326
...................................................................
============= =============
Net income per share $ 0.01 $ 0.04
...................................................................
Weighted average shares outstanding 10,960 8,895
...................................................................
See accompanying notes
PLANNING SCIENCES INTERNATIONAL PLC
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Three months ended
----------------------------------------------
March 31, 1997 March 31, 1996
-------------------- --------------------
(in thousands)
US$ US$
Cash flows from operating activities
Net income $ 59 $ 326
........................................................................
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation 197 95
........................................................................
Goodwill 88 -
........................................................................
Changes in operating assets and liabilities:
Accounts receivable (323) (1,019)
........................................................................
Provision for bad debts (24) 2
........................................................................
Prepaid expenses and other receivables (93) (972)
........................................................................
Accounts payable (904) 225
........................................................................
Accrued liabilities and other expenses (833) 124
........................................................................
Deferred revenues 210 324
........................................................................
------------- -------------
Net cash (used in) operating activities (1,623) (886)
........................................................................
------------- -------------
Cash flows from investing activities:
Purchases of assets (425) (264)
........................................................................
------------- -------------
Net cash (used in) investing activities (425) (264)
........................................................................
------------- -------------
Cash flows from financing activities:
Proceeds from options exercised 124 -
........................................................................
Net (repayment) of capital lease obligations (22) (27)
........................................................................
Increase (decrease) in bank overdraft - (391)
........................................................................
------------- -------------
Net cash provided by (used in) financing activities 102 (418)
........................................................................
Effect of exchange rate changes on cash (75) (73)
........................................................................
------------- -------------
Net (decrease) in cash (2,021) (1,641)
........................................................................
Cash at beginning of period 25,228 2,280
------------- -------------
US$ US$
........................................................................
------------- -------------
Cash at end of period $23,207 $ 639
........................................................................
============= =============
See accompanying notes
PLANNING SCIENCES INTERNATIONAL PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business
Planning Sciences International plc (the "Company") is incorporated in England
and Wales. The Company develops, markets and supports high performance
client/server decision support software for business planning and decision
making. Its principal product is marketed under the name Gentia.
Basis of Presentation
The consolidated financial statements are stated in United States dollars and
are prepared under United States generally accepted accounting principles.
Interim Financial Information
The financial information at March 31, 1997 and for the three months ended March
31, 1997 and 1996 is unaudited but includes all adjustments which the Company
considers necessary for a fair presentation of the financial position at such
date and the operating results and cash flows for those periods. Results for the
three month period ended March 31, 1997 are not necessarily indicative of
results that may be expected for the entire year. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with United States generally accepted accounting principles have been
condensed or omitted pursuant to the Securities and Exchange Commission Rules
and Regulations. These condensed consolidated financial statements should be
read in conjunction with the audited consolidated financial statements and notes
for the year ended December 31, 1996 included in the Company's Registration
Statement to be filed.
Principles of Consolidation
The accompanying financial statements consolidate the accounts of the Company
and its wholly owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.
Foreign Exchange
The consolidated balance sheets of the Company and its foreign subsidiaries are
translated from their respective functional currencies to United States dollars
at period-end exchange rates and the statements of operations and cash flows at
average rates for the relevant periods. Gains and losses resulting from
translation are accumulated as a separate component of shareholders' equity. Net
gains and losses resulting from foreign exchange transactions, which are not
material in any of the reporting periods, are included in the consolidated
statement of operations.
Per Share Information
Net income per share information is computed based on the weighted average
number of shares outstanding and dilutive share equivalents of outstanding share
options using the treasury stock method. For the three month period ended March
31, 1996, in accordance with the requirements of the Securities and Exchange
Commission, the computation takes into account the retroactive effect of share
options and shares issued in the twelve months to March 31, 1996, which have
been treated as outstanding. In the application of the treasury stock method
with respect to such issuances, the IPO price of $16.00 has been used as the
repurchase price.
2 LITIGATION
The Company is involved in one legal action arising in relation to patents in
the United States. While the outcome of this matter is currently not
determinable, it is management's opinion that this matter will not have a
material adverse effect on the Company's consolidated financial condition or
results of its operations.
PLANNING SCIENCES INTERNATIONAL PLC
Management's Discussion and Analysis of Financial Condition
and Results of Operations
for the three months ended March 31, 1997 and 1996
Three months ended March 31, 1997 and 1996.
Revenues
Revenues were $7.0 million in the 3 months ended March 31, 1997, an increase of
35% compared to revenues of $5.2 million for the 3 months ended March 31, 1996.
License revenues were $4 million in the 3 months ended March 31, 1997, an
increase of 19% over license revenues of $3.3 million for the 3 months ended
March 31, 1996. Services and other revenues were $3.0 million in the 3 months
ended March 31, 1997, an increase of 61% when compared to $1.9 million for the 3
months ended March 31, 1996. The increase in revenues reflected both increased
sales of the Company's Gentia product as well as increased consulting and
maintenance services related thereto.
Gross Profit
Gross profit was $5.3 million or 76.0% for the 3 months ended March 31, 1997,
compared to $4.1 million or 78.2% for the 3 months ended March 31, 1996. The
decrease in gross margin was primarily due to a higher proportion of services
and other revenue in the three months ended March 31, 1997 (March 31, 1997 -
43.5%; March 31, 1996 - 36.3%).
Sales and Marketing
Sales and marketing costs were $3.1 million in the 3 months ended March 31,
1997, an increase of 51% compared to $2.1 million in the 3 months ended March
31, 1996. The increase in dollar expenditure reflects the Company's increased
investment in its sales and marketing organization especially in the United
States. The Company expects these expenses will continue to increase as a result
of its continued investment in its sales and marketing organization. The Company
is also expanding its geographic coverage and will continue to do so.
Research and Development
Research and development costs were $1.2 million in the 3 months ended March 31,
1997, an increase of 104% compared to $597,000 in the 3 months ended March 31,
1996. The increase is primarily as a result of hiring additional personnel to
continue the Company's development program and the opening of a new research
facility in Glasgow, Scotland. It is the Company's intention to continue to
accelerate its expenditure on research and development of new products when it
considers it appropriate to do so. The Company's research and development
expenditure is predominantly incurred in pounds sterling.
General and Administrative
General and administrative costs were $1.1 million in the 3 months ended March
31, 1997, an increase of 26% compared to $885,000 in the 3 months ended March
31, 1996.
Other Income (expenses)
Other income was $303,000 in the 3 months ended March 31, 1997 compared to an
expense of $2,000 in the 3 months ended March 31, 1996. The additional income
was primarily due to interest income received on the proceeds from the Company's
Initial Public Offering completed on April 30, 1996.
PLANNING SCIENCES INTERNATIONAL PLC
Management's Discussion and Analysis of Financial Condition
and Results of Operations
for the three months ended March 31, 1997 and 1996. (Continued)
Liquidity and Capital Resources
As of March 31, 1997, the Company had cash and cash equivalents of $23.2m
compared to $25.2m at December 31, 1996.
Accounts receivable at March 31, 1997 were $10.3m, an increase of 3.5% compared
to December 31, 1996 reflecting extended payment terms given on certain
contracts. In the three months ended March 31, 1997, the Company's operating
activities consumed cash of $1.6 million compared to $886,000 in the three
months ended March 31, 1996. The increase was primarily due to a decrease in
accounts payable and liabilities and expenses accrued at the year end.
Investing activities consumed $425,000 in the three months ended March 31, 1997
compared to $264,000 in the three months ended March 31, 1996. The increase was
due to additional assets purchased.
Financing activities generated $102,000 in the three months ended March 31, 1997
compared to the use of $418,000 in the three months ended March 31, 1996. The
change arises primarily because of the repayment of the bank overdraft in the
three months ended to March 31, 1996 and the exercise of options in the three
months to March 31, 1997.
The Company believes that existing cash, cash equivalents and cash generated by
operations will be sufficient to meet the Company's working capital needs and
currently planned capital expenditure requirements for the next twelve months.
The information contained in Exhibit 1 hereto, consisting of the registrant's
unaudited financial statements for the three months ended March 31, 1997, has
been distributed to its security holders and is furnished to the Commission
pursuant to Rule 13a-16 under the Securities Act of 1934, as amended (the
"Act"). This report and the information furnished herewith shall not be deemed
to be "filed" for the purposes of Section 18 of the Act or otherwise subject to
the liabilities of that section.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused the Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PLANNING SCIENCES
INTERNATIONAL PLC
By: [Signature of Anthony K. Fox]
Anthony K. Fox
Chief Financial Officer
Date: May 1, 1997
EXHIBIT INDEX
Page
Exhibit A First Quarter Press Release - (1997) 11
EXHIBIT A
FOR IMMEDIATE RELEASE
May 1, 1997
PLANNING SCIENCES INTERNATIONAL REPORTS FIRST QUARTER RESULTS
LONDON, May 1, 1997 - Planning Sciences International plc (Nasdaq: PLNSY) the
international supplier of software for business planning and decision making,
today reported net income of $59,000, or $0.01 per share, on revenues of $7
million in the first quarter of 1997.
The comparable totals for the first quarter of 1996 were net income of $326,000,
or $0.04 per share, and revenues of $5.2 million. The weighted average number of
shares outstanding was 11.0 million at March 31, 1997, and 8.9 million a year
earlier.
Paul Rolph, Chairman and Chief Executive Officer, noted that revenue associated
with the company's Gentia software was 35 per cent higher in this year's first
quarter than in the comparable period of 1996.
"Despite continued strong revenue growth in 1997 compared to the opening months
of 1996, our overall results are disappointing because several large potential
orders in the U.K have not been closed," Mr. Rolph said. "We have taken action
to address the issue and we expect that our U.K business will show improvement
as the year continues.
"During the quarter we established additional sales teams in Dallas and Chicago
and can report that our sales pipelines are significantly larger than they were
a year ago in both the U.S. and the U.K. We are pleased with the marketing
campaigns and channels strategies initiated by Scott Silk in his first quarter
as vice president-worldwide marketing. Our new market positioning as `Business
Intelligence for a Networked World' has been well accepted by customers,
industry and financial analysts alike."
Mr.Rolph added that Gentia's architecture and ease of deployment are becoming
increasingly powerful differentiators -- major factors in helping Planning
Sciences to win business from competitors. He said that Version 3.1 with Gentia
WebSuite, released at the end of this year's first quarter, has further
strengthened Gentia's competitive position.
First quarter 1997 achievements by Planning Sciences International included:
[bullet] Successful deployment of Gentia on Java stations at Sun Microsystems
headquarters.
[bullet] License revenue growth of 150 per cent in the U.S., partly as a result
of success in competing for the business of customers including Reckitt
& Colman, Aerospace Structures Corporation and Concert Communications,
and a large upgrade at Motorola Inc..
[bullet] Significant wins in Europe including Union Bank of Switzerland and BZW.
About the Company
Planning Sciences International plc, Nasdaq flotation April 30, 1996, focuses on
the development of the Enterprise Decision Support System, Gentia. The joint
global headquarters of the company are in Boston, USA and London, England.
Planning Sciences, Inc., also has offices in New York, Denver, Atlanta and San
Francisco, in the USA. The company also has offices in Australia, Hong Kong,
South Africa, Belgium and the Netherlands.
Gentia is a high performance client/server decision support system for complex
business analysis and reporting. Gentia applications are deployed using a
distributed agent based architecture which ensures delivery of key information
to the desktop of decision makers throughout an organization.
Gentia has more than 350 corporate and public sector clients including Sun
Microsystems, Motorola, Barclays Bank, Volvo, Hewlett Packard and McDonnell
Douglas.
Internet users can obtain further information on Planning Sciences via the
Planning Sciences home page: http://www.gentia.com.
This news release contains statements of a forward-looking nature relating to
the financial performance of Planning Sciences International plc. Such
statements are based upon the information available to management at this time,
and they necessarily involve risk because actual results could differ materially
from current expectations. Among the many factors that could cause actual
results to differ from those set forth in the company's forward-looking
statements are changes in general economic conditions, actions taken by
customers or competitors, and the receipt of more or fewer orders than expected.
--Financial Tables Follow--
PLANNING SCIENCES INTERNATIONAL PLC
Condensed Consolidated Statement of Operations
(Unaudited)
Three months ended
----------------------------------------------
March 31, 1997 March 31, 1996
-------------------- --------------------
(in thousands, except per share amounts)
US$ US$
Revenues:
License $3,956 $3,313
...................................................................
Services and other 3,045 1,890
...................................................................
------------- -------------
7,001 5,203
------------- -------------
Cost of revenues:
License 167 102
...................................................................
Services and other 1,515 1,032
...................................................................
------------- -------------
1,682 1,134
------------- -------------
Gross profit 5,319 4,069
...................................................................
Operating expenses:
Sales and marketing 3,114 2,067
...................................................................
Research and development 1,215 597
...................................................................
General and administrative 1,117 885
...................................................................
Goodwill amortization 88 -
...................................................................
------------- -------------
Total operating expenses 5,534 3,549
...................................................................
------------- -------------
(Loss) income from operations (215) 520
...................................................................
Other income (expense) 303 (2)
...................................................................
------------- -------------
Income before provision for taxes 88 518
...................................................................
Provision for income taxes 29 192
....................................
------------- -------------
Net income $ 59 $ 326
...................................................................
============= =============
Net income per share $ 0.01 $ 0.04
...................................................................
Weighted average shares outstanding 10,960 8,895
...................................................................
PLANNING SCIENCES INTERNATIONAL PLC
Condensed Consolidated Balance Sheets
(Unaudited)
March 31, 1997 December 31, 1996
-------------------- ----------------------
(in thousands)
US$ US$
Assets
Current assets:
Cash and cash equivalents $23,207 $25,228
........................................................................
Accounts receivable, net of allowance $454
(Dec 31,1996 - $478) 10,300 9,953
........................................................................
Prepaid expenses and other current assets 914 821
........................................................................
------------- -------------
Total current assets 34,421 36,002
........................................................................
Property and equipment, net 2,177 2,013
........................................................................
Goodwill on acquisition, net of amortization of $210
(Dec 31, 1996 - $122) 3,300 3,388
........................................................................
Deferred taxation 148 148
........................................................................
------------- -------------
Total assets $40,046 $41,551
........................................................................
============= =============
Liabilities and shareholders' equity
Current liabilities:
Current portion of lease obligations $187 $194
........................................................................
Accounts payable 744 1,648
........................................................................
Taxes payable 1,162 1,373
........................................................................
Accrued liabilities 1,345 1,778
........................................................................
Deferred revenues 3,179 2,969
........................................................................
UK value added tax 295 346
........................................................................
Other accounts payable 847 985
........................................................................
------------- -------------
Total current liabilities 7,759 9,293
........................................................................
Non current liabilities:
Deferred taxation 29 29
........................................................................
Long-term portion of lease obligations 210 225
........................................................................
------------- -------------
Total liabilities 7,998 9,547
........................................................................
Shareholder's equity:
Ordinary shares 2,156 2,152
........................................................................
Additional paid-in capital 27,302 27,182
........................................................................
Retained earnings 2,806 2,747
........................................................................
Cumulative translation adjustment (216) (77)
........................................................................
------------- -------------
Total shareholders' equity 32,048 32,004
........................................................................
------------- -------------
Total liabilities and shareholders' equity $40,046 $41,551
........................................................................
============= =============