CKS GROUP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands)
May 31, November 30,
1998 1997
ASSETS
Current assets:
Cash and cash equivalents $21,625 $18,223
Marketable securities 17,263 24,041
Accounts receivable, net of allowance 42,616 50,049
Fees and expenditures in excess of billings 7,406 4,594
Prepaid expenses and other current assets 2,749 1,949
Deferred income taxes 1,514 1,400
Total current assets 93,173 100,256
Property and equipment, net 5,735 5,849
Deferred income taxes 7,394 10,140
Goodwill and other assets 35,100 30,228
Total assets $141,402 $146,473
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $26,084 $38,161
Accrued expenses 8,343 7,515
Billings in excess of fees and expenditures 4,162 2,417
Current portion of liabilities to
related parties 309 2,284
Current portion of notes payable and
capital lease obligations 373 765
Income taxes payable 1,647 --
Total current liabilities 40,918 51,142
Notes payable and capital lease obligations,
less current portion 765 739
Total liabilities 41,683 51,881
Stockholders' equity:
Common stock 15 15
Additional paid-in capital 81,305 80,103
Unrealized gain (loss) on
marketable securities (37) 12
Notes receivable from stockholders (198) (198)
Cumulative translation adjustment (99) (62)
Retained earnings 18,733 14,722
Total stockholders' equity 99,719 94,592
Total liabilities and stockholders' equity $141,402 $146,473
CKS GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(In thousands, except per share data)
Three Months Ended Six Months Ended
May 31, June 1, May 31, June 1,
1998 1997 1998 1997
Revenues $39,808 $35,911 $71,998 $60,230
Operating expenses:
Direct salaries and
related expenses 10,303 8,345 20,428 15,455
Other direct operating expenses 15,982 14,560 28,473 23,418
General and administrative
expenses 7,774 7,514 15,039 12,869
Depreciation and amortization 972 851 1,909 1,414
Merger costs -- -- -- 1,593
Total operating expenses 35,031 31,270 65,849 54,749
Operating income 4,777 4,641 6,149 5,481
Other income, net 310 267 747 790
Income before income taxes 5,087 4,908 6,896 6,271
Income taxes 2,181 2,026 2,885 2,200
Net income $2,906 $2,882 $4,011 $4,071
Pro forma net income and
per share data: (A)
Income before income taxes,
as reported $5,087 $4,908 $6,896 $6,271
Pro forma income taxes 2,181 2,026 2,885 2,200
Pro forma net income $2,906 $2,882 $4,011 $4,071
Pro forma basic net income
per share $0.19 $0.20 $0.26 $0.28
Shares used in basic
per share computation 15,286 14,511 15,303 14,379
Pro forma diluted net income
per share $0.18 $0.18 $0.25 $0.26
Shares used in diluted
per share computation 16,402 15,620 16,231 15,510
EBITDA 5,615 5,501 7,934 6,926
(A) Pro forma net income gives effect to pooling-of-interests combinations between the Company, SiteSpecific and M&S.
M&S was a general partnership and, as a result, M&S's historical results of operations, which have been included with the
Company's under the pooling of interest method, do not include a provision for income taxes. Pro forma net income and net
income per share data include a tax provision as if M&S had been a taxable C corporation for all periods.
CKS GROUP, INC. AND SUBSIDIARIES
Pro Forma Consolidated Statements of Income (A)
Three Months Ended Six Months Ended
May 31, June 1, May 31, June 1,
1998 1997 1998 1997
Revenues $39,808 $35,911 $71,998 $60,230
Operating expenses:
Direct salaries and
related expenses 10,303 8,345 20,428 15,455
Other direct operating expenses 15,982 14,560 28,473 23,418
General and administrative
expenses 7,774 7,514 15,039 12,869
Depreciation and amortization 972 851 1,909 1,414
Total operating expenses 35,031 31,270 65,849 53,156
Operating income 4,777 4,641 6,149 7,074
Other income, net 310 267 747 790
Income before income taxes 5,087 4,908 6,896 7,854
Income taxes 2,181 2,026 2,885 3,116
Net income $2,906 $2,882 $4,011 $4,748
Pro forma basic net income
per share $0.19 $0.20 $0.26 $0.33
Shares used in basic per
share computation 15,286 14,511 15,303 14,379
Pro forma diluted net income
per share $0.18 $0.18 $0.25 $0.31
Shares used in diluted
per share computation 16,402 15,620 16,231 15,510
EBITDA 5,615 5,501 7,934 8,519
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