Friday March 26, 9:01 am Eastern Time
Company Press Release
SOURCE: The Learning Company, Inc.
The Learning Company, Inc. Announces Fourth Quarter 1998 Results of $.58 Per Share and Sets May 7, 1999 for Stockholders to Vote on the Mattel Merger
CAMBRIDGE, Mass., March 26 /PRNewswire/ -- The Learning Company, Inc. (NYSE: TLC - news) today announced its financial results for the three and twelve month periods ended December 31, 1998. It also announced that both it and Mattel, Inc. (NYSE: MAT - news) have set May 7, 1999 as the meeting date for stockholders of each company to vote on the proposed merger of the two companies. The two companies plan to begin mailing the proxy materials for the stockholder meeting this week.
Revenues for the three and twelve month periods ended December 31, 1998 were $275,273,000 and $839,315,000 as compared to the prior year's revenues in the three and twelve month periods of $219,399,000 and $620,931,000.
Excluding amortization, merger and other charges in the three month period ended December 31, 1998 of $30,810,000, adjusted net income for the three month period ended December 31, 1998 would have been $64,607,000 as compared to $40,389,000 in the prior year three month period ended December 31, 1997. Earnings per share for the three month period ended December 31, 1998, excluding the effect of the amortization, merger and other charges, would have been $.58 as compared to $.56 in the prior year three month period ended December 31, 1997. Reported diluted net income (loss), including amortization, merger and other costs for the three month period ended December 31, 1998 and 1997 was $.35 and ($2.50) per share, respectively.
Excluding amortization, merger and other charges in the twelve month period ended December 31, 1998 of $258,314,000, adjusted net income for the twelve month period ended December 31, 1998 would have been $132,058,000 as compared to $90,634,000 in the prior year twelve month period ended December 31, 1997. Earnings per share for the twelve month period ended December 31, 1998, excluding the effect of the amortization, merger and other charges, would have been $1.36 as compared to $1.35 in the prior year twelve month period ended December 31, 1997. Reported diluted net loss, including amortization, merger and other costs for the twelve month period ended December 31, 1998 and 1997 was $1.28 and $7.48 per share, respectively.
Michael Perik, Chairman and Chief Executive Officer of The Learning Company said, ''Our fourth quarter financial results continued to demonstrate strong operating margins and cash flows. As the first quarter comes to a close, we are pleased with the continued strength in our core franchises. As of the most recently available PC Data information, we continue to be the leader in both the both education and productivity segments.''
Mr. Perik also said, ''We expect the Securities and Exchange Commission to declare the registration statement and joint proxy statement for the proposed merger with Mattel effective today. We intend to mail the proxy statement to stockholders in the next few days and have set the stockholder meeting date for May 7, 1999 to allow our stockholders to vote on the proposed merger. The Company and its Board of Directors strongly supports this merger, which, brings together not only our strong brands, but also extends our strength in the world of direct and electronic software distribution.''
The Learning Company also announced today that as a result of recent discussions with the SEC in connection with its review of the registration statement and joint proxy statement related to the proposed merger with Mattel, the Company has implemented the methodology and guidelines endorsed by the SEC as set forth in its September 9, 1998 letter to the American Institute of Certified Public Accountants related to the valuation of in-process technology and other intangible assets related to the Company's acquisition of Mindscape in March 1998. The Company has restated its previously issued results to reflect the discussions with the SEC and to apply the guidance and policy. After applying the guidance and policy, the allocation of the Mindscape purchase price was changed for in-process technology from $103,000,000 to $40,000,000; for complete and core technology from $13,000,000 to $22,000,000; for brands and trade names from $30,000,000 to $38,000,000; resulting in a change to goodwill from $12,988,000 to $58,988,000. The restatement of these amounts reduces the reported net loss for the year ended December 31, 1998 by $51,893,000 and primarily increases goodwill, which is being amortized over a ten year period. |
