-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EfSQW9R0nKNrjxQR+RN4kuEn5MD8zKgVO3WqdJLhbTKyCd6L5El0JhrV0thRHxFK L8D0/DCHpsD6+2dL2xmI2A== 0000950142-96-000364.txt : 19960813 0000950142-96-000364.hdr.sgml : 19960813 ACCESSION NUMBER: 0000950142-96-000364 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960812 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: NFO RESEARCH INC CENTRAL INDEX KEY: 0000897940 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT [8700] IRS NUMBER: 061327424 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-21460 FILM NUMBER: 96608347 BUSINESS ADDRESS: STREET 1: 2 PICKWICK PLAZA STREET 2: STE 400 CITY: GREENWICH STATE: CT ZIP: 06830 BUSINESS PHONE: 2036298888 MAIL ADDRESS: STREET 1: TWO PICKWICK PLAZA CITY: GREENWICH STATE: CT ZIP: 06830 10-Q 1 FORM 10Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996 OR [X] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to_______________ Commission file number: 0 - 21460 NFO RESEARCH, INC. (Exact name of registrant as specified in its charter) DELAWARE 06-1327424 -------------- ------------------ (State or other jurisdiction of (I.R.S. Employer incorporation or organizaiton) Identification No.) TWO PICKWICK PLAZA, GREENWICH, CT 06830 (Address of principal executive offices, zip code) (203) 629 - 8888 -------------------------------------------- (Registrant's telephone number, including area code) --------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicated by check mark whether the registrant (1) 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), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No APPLICABLE ONLY TO CORPORATE ISSUERS: At August 1, 1996, Registrant had outstanding 10,190,692 shares of Common Stock. NFO RESEARCH, INC. INDEX PAGE Part I FINANCIAL INFORMATION NUMBER FINANCIAL STATEMENTS Condensed Consolidated Balance Sheets 3 Condensed Consolidated Statements of Income 4 Condensed Consolidated Statements of Cash Flows 5 Condensed Consolidated Statement of Stockholders' Equity 8 Notes to Condensed Consolidated Financial Statements 9 Management's Discussion and Analysis of Financial Condition and Results of Operations 10 Part II OTHER INFORMATION Item 4 - Submission of Matters to a Vote of Security Holders 14 Item 6 - Exhibits and Reports on Form 8-K 14 Signature 15 2 NFO RESEARCH, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE DATA) JUNE 30 DECEMBER 31 1996 1995 ASSETS (UNAUDITED) CURRENT ASSETS: CASH AND CASH EQUIVALENTS $ 2,304 $ 5,677 RECEIVABLES: TRADE 18,772 14,155 UNBILLED 3,427 3,188 PREPAID EXPENSES AND OTHER CURRENT ASSETS 2,746 2,734 ------ ------ TOTAL CURRENT ASSETS 27,249 25,754 PROPERTY AND EQUIPMENT, NET 10,234 8,756 CUSTOMER LIST, GOODWILL AND OTHER TANGIBLE ASSETS 41,614 26,501 OTHER ASSETS 6,246 5,753 ------ ------ TOTAL ASSETS $85,343 $66,764 ====== ====== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: CURRENT MATURITIES OF LONG-TERM DEBT $ 642 $ 643 ACCOUNTS PAYABLE 1,666 1,543 ACCRUED EXPENSES 8,576 8,700 CUSTOMER BILLINGS IN EXCESS OF REVENUES EARNED 7,853 7,019 ------ ------ TOTAL CURRENT LIABILITIES 18,737 17,905 LONG-TERM LIABILITIES 7,192 4,838 ------ ------ TOTAL LIABILITIES 25,929 22,743 ------ ------ STOCKHOLDERS' EQUITY: COMMON STOCK, PAR VALUE $.01 PER SHARE; 15,000 SHARES AUTHORIZED, 10,190 AND 9,428 (POST-SPLIT) ISSUED AND OUTSTANDING IN 1996 AND 1995, RESPECTIVELY 102 63 ADDITIONAL PAID-IN CAPITAL 38,635 27,222 RETAINED EARNINGS 21,346 17,405 ADDITIONAL MINIMUM LIABILITY (669) (669) ------- ------- TOTAL STOCKHOLDERS' EQUITY 59,414 44,021 TOTAL LIABILITIES AND STOCKHOLDERS' ------ ------ EQUITY $ 85,343 $66,764 ======== ======= The accompanying notes are an integral part of these statements. 3 NFO RESEARCH, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (IN THOUSANDS, EXCEPT PER SHARE DATA) THREE MONTHS SIX MONTHS ENDED JUNE 30 ENDED JUNE 30 1996 1995 1996 1995 REVENUES $ 25,644 $17,353 $49,750 $33,571 COST OF REVENUES 11,065 7,344 21,859 14,390 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 9,043 6,165 17,852 12,222 DEPRECIATION EXPENSE 394 308 784 607 AMORTIZATION EXPENSE 775 542 1,550 1,075 ------ ------ ------- ------- OPERATING INCOME 4,367 2,994 7,705 5,277 INTEREST EXPENSE, NET 60 (4) 103 21 EQUITY INTEREST IN NET LOSS OF JOINT VENTURES 140 0 270 0 ------- ------ ------- ------- INCOME BEFORE INCOME TAXES 4,167 2,998 7,332 5,256 PROVISION FOR INCOME TAXES 1,927 1,270 3,391 2,243 ------ ------- ------- ------- NET INCOME $2,240 $1,728 $3,941 $3,013 ======= ======= ======= ====== EARNINGS PER WEIGHTED AVERAGE SHARE OUTSTANDING(a): PRIMARY $.21 $.18 $.37 $.31 FULLY DILUTED $.20 $.18 $.36 $.31 WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING(a): PRIMARY 10,713 9,675 10,638 9,620 FULLY DILUTED 10,789 9,732 10,749 9,701 [FN] (a) For comparability, the earnings per share and share data reflect the three- for-two stock split effected on February 5, 1996. The accompanying notes are an integral part of these statements. 4 NFO RESEARCH, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED, IN THOUSANDS) THREE MONTHS SIX MONTHS ENDED JUNE 30 ENDED JUNE 30 1996 1995 1996 1995 CASH FLOW FROM OPERATING ACTIVITIES: NET INCOME $2,240 $1,728 $ 3,941 $ 3,013 ADJUSTMENTS TO RECONCILE TO NET CASH PROVIDED BY OPERATING ACTIVITIES: DEPRECIATION 394 308 784 607 AMORTIZATION 775 542 1,550 1,075 EQUITY INTEREST IN NET LOSS OF JOINT VENTURES 140 ---- 270 ---- ----- ----- ----- ----- SUBTOTAL 3,549 2,578 6,545 4,695 CHANGE IN ASSETS AND LIABILITIES THAT PROVIDED (USED) CASH: TRADE RECEIVABLES (3,948) (1,511) (420) (918) UNBILLED RECEIVABLES 1,153 (1,034) 58 (1,209) PREPAID EXPENSES AND OTHER CURRENT ASSETS 348 228 80 (709) OTHER ASSETS 191 19 177 (23) ACCOUNTS PAYABLE, ACCRUED AND OTHER LIABILITIES (460) (1,063) (453) (2,265) CUSTOMER BILLINGS IN EXCESS OF REVENUES EARNED (1,487) (626) (2,407) 468 ------- ------ -------- ------ NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES (654) (1,409) 3,580 39 ------- ------- ----- ---- CASH FLOW FROM INVESTING ACTIVITIES: CAPITAL EXPENDITURES (1,280) (513) (1,691) (864) PAYMENT FOR PLOG - NET OF CASH ACQUIRED 0 ----- (2,278) ---- PAYMENT FOR M/K - NET OF CASH ACQUIRED 0 ----- (3,417) ---- PAYMENT FOR PSI - NET OF CASH ACQUIRED (523) (400) (523) (400) INVESTMENTS IN JOINT VENTURES (39) ----- (933) ----- PURCHASE OF LICENSE AGREEMENT, OTHER INTANGIBLES (3) ----- (40) (108) ------- ------ ------- ------ NET CASH USED IN INVESTING ACTIVITIES (1,845) (913) (8,882) (1,372) ------- ------- ------- ------- The accompanying notes are an integral part of these statements. 5 NFO RESEARCH, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED, IN THOUSANDS) (Continued) THREE MONTHS SIX MONTHS ENDED JUNE 30 ENDED JUNE 30 1996 1995 1996 1995 CASH FLOW FROM FINANCING ACTIVITIES: NET PROCEEDS FROM ISSUANCE OF STOCK 346 288 572 413 PAYMENTS ON LONG-TERM DEBT (451) (171) (3,643) (341) COSTS ASSOCIATED WITH NEW CREDIT FACILITY --- (4) ---- (101) BORROWINGS ON LINE OF CREDIT --- ----- 5,000 ---- ------ ------- ------- ------ NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (105) 113 1,929 (29) ------ ------- ------- ------ CHANGE IN CASH (2,604) (2209) (3,373) (1,362) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 4,908 7,135 5,677 6,288 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 2,304 $ 4,926 $ 2,304 $ 4,926 ======= ======== ======= ======= The accompanying notes are an integral part of these statements. 6 NFO RESEARCH, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED, IN THOUSANDS) THREE MONTHS SIX MONTHS ENDED JUNE 30 ENDED JUNE 30 1996 1995 1996 1995 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: CASH PAID DURING THE PERIOD FOR: INTEREST $ 64 $ 61 $ 160 $ 117 INCOME TAXES $2,684 $2,375 $3,071 $2,926 SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: The Company purchased Migliara/Kaplan Associates, Inc. and Chesapeake Surveys, Inc. for $3.6 million in cash and $7.9 million in shares of the Company's Common Stock (see Note 2), effective January 3, 1996. The Company also purchased Plog Research, Inc. for $5.0 million, one half in cash and one half in shares of the Company's Common Stock (see Note 2), effective January 3, 1996. In connection with these purchases, the following liabilities were assumed. Fair value of assets acquired $ 22,148 Less: cash paid (6,056) Less: 677,298 (post-stock split) Company shares issued (10,356) -------- Liabilities assumed $ 5,736 ======== The accompanying notes are an integral part of these statements. 7 NFO RESEARCH, INC. CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (UNAUDITED, IN THOUSANDS) ADDITIONAL ADDITIONAL COMMON PAID-IN RETAINED MINIMUM SHARES STOCK CAPITAL EARNINGS LIABILITY BALANCE AT JANUARY 1, 1996 6,285 $63 $27,222 $17,405 $(669) COMMON STOCK ISSUED IN CONJUNCTION WITH ACQUISITIONS 473 5 10,875 COMMON STOCK ISSUED IN CONJUNCTION WITH THE 3 FOR 2 STOCK SPLIT 3,375 34 (34) OTHER STOCK ISSUANCES 57 0 572 NET INCOME 3,941 BALANCE AT JUNE 30, 1996 10,190 $102 $38,635 $ 21,346 $(669) ====== ==== ======= ======== ====== The accompanying notes are an integral part of this statement. 8 NFO RESEARCH, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1. Financial Statements: These condensed consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly owned. All significant intercompany amounts have been eliminated. In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position of the Company as of June 30, 1996 and the results of its operations for the three and six month periods ended June 30, 1996 and June 30, 1995, respectively. These financial statements are presented in accordance with the requirements of Form 10-Q. Accordingly, the financial statements and related notes in the Company's Audited Financial Statements for the fiscal year ended December 31, 1995, included in the Company's Form 10-K filed with the SEC on March 28, 1996, should be read in conjunction with the accompanying condensed consolidated financial statements. The information included herein may not be indicative of the results to be expected for a full year. Certain reclassifications have been made to the 1995 condensed consolidated financial statements to conform with the 1996 presentation. Note 2. Acquisitions: On January 3, 1996, the Company acquired Migliara/Kaplan Associates, Inc. ("M/K") and substantially all the net assets of Chesapeake Surveys, Inc. ("CSI") for approximately $15.2 million. M/K is a full-service healthcare marketing information company with offices in Baltimore, Maryland and Princeton, New Jersey. CSI, a sister company of M/K, provides data collection and survey services such as focus groups and random telephone interviews. Of the total purchase price, approximately $11.45 million was paid at closing, approximately 31 percent in cash and 69 percent in newly issued shares of NFO Common Stock. The remaining $3.75 million is payable over the next three years subject to adjustment based on the combined actual earnings of M/K and CSI during that period and will be accounted for as an adjustment to goodwill. On January 3, 1996, the Company acquired Plog Research, Inc. ("Plog"). Plog supplies syndicated market research products as well as marketing and forecasting services to the travel and tourism industries. Of the total purchase price, approximately $5.0 million was paid at closing, 50 percent in cash, and 50 percent in newly issued shares of NFO Common Stock. The remaining purchase price of approximately $1.7 million is payable over the next three years, 50 percent in cash and 50 percent in NFO stock, subject to adjustment based on Plog's actual earnings during the period and will be accounted for as an adjustment to goodwill. Both acquisitions have been accounted for as purchases and the accompanying financial statements include the results of operations from the effective date of the acquisitions. The purchase price allocations are based on preliminary estimates of fair market value and are subject to revision. 9 The following unaudited proforma summary presents the consolidated results of operations as if the acquisitions had occurred on January 1, 1995 and do not purport to be indicative of what would have occurred had the acquisitions been made at that date or of the results which may occur in the future. FOR THE THREE MONTHS FOR THE SIX MONTHS ENDED JUNE 30 ENDED JUNE 30 1996 1995 1996 1995 REVENUES $25,644 $ 21,987 $49,750 $42,126 NET INCOME 2,240 2,065 3,941 3,534 PRIMARY EARNINGS PER SHARE $.21 $.20 $.37 $.34 The Company's results of operations for 1996 include net operating losses associated with NFO's European joint venture activities now operating in France, Germany and the U.K. These losses amounted to $140,000, or $.01 per share, and $270,000, or $.03 per share, for the three and six month periods ended June 30, 1996, respectively. Note 3. Stock Split: On January 5, 1996 the Company's Board of Directors authorized a three for two stock split of the Company's Common Stock that was effected on February 5, 1996, for holders of record as of January 22, 1996. The accompanying financial statements give effect to the stock split. 10 NFO RESEARCH, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following information should be read in conjunction with the unaudited condensed consolidated financial statements and the notes thereto included in this Quarterly Report. RESULTS OF OPERATIONS The following table sets forth, for the periods indicated, certain operating statement data for the Company, expressed as a percentage of revenues, and the percentage change in such items compared to amounts for the prior year.
THREE MONTHS ENDED JUNE 30 SIX MONTHS ENDED JUNE 30 ------------------------------ -------------------------- PERCENTAGE OF PERCENTAGE PERCENTAGE OF PERCENTAGE REVENUES CHANGE FROM REVENUES CHANGE FROM 1996 1995 PRIOR YEAR 1996 1995 PRIOR YEAR ---- ---- ---------- ---- ---- ----------- REVENUES 100.0% 100.0% 47.8% 100.0% 100.0% 48.2% COST OF REVENUES 43.2 42.3 50.7 43.9 42.9 51.9 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 35.3 35.5 46.7 35.9 36.4 46.1 DEPRECIATION EXPENSE 1.5 1.8 27.9 1.6 1.8 29.2 AMORTIZATION EXPENSE 3.0 3.1 43.0 3.1 3.2 44.2 OPERATING INCOME 17.0 17.3 45.9 15.5 15.7 46.0 INTEREST EXPENSE, NET 0.2 0.0 (1600.0) 0.2 0.0 390.5 EQUITY INTEREST IN NET LOSS OF JOINT VENTURES 0.6 0.0 ----- 0.6 0.0 ----- INCOME BEFORE INCOME TAXES 16.2 17.3 39.0 14.7 15.7 39.5 PROVISION FOR INCOME TAXES 7.5 7.3 51.7 6.8 6.7 51.2 NET INCOME 8.7% 10.0% 29.6% 7.9% 9.0% 30.8% ===== ====== ===== ======== ====== =====
11 NFO RESEARCH, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OPERATIONS The Company's revenues for the three months ended June 30, 1996 increased 48% to $25.6 million from $17.4 million for the same period last year. For the six month period ended June 30, 1996 revenues increased 48% to $49.8 million from $33.6 million. The acquisitions of Migliara/Kaplan Associates, Chesapeake Surveys and Plog Research, which occurred on January 3, 1996, contributed $6.2 million to the $8.3 million increase in revenues for the quarter, and $11.2 million to the $16.2 million increase for the six month period just ended. Revenues, not including those of the acquired companies, increased 12% for the quarter, led by strong showings in NFO's core packaged goods and financial services business units. Cost of revenues increased 51% in the second quarter to $11.1 million from $7.3 million a year ago. This increase is primarily due to the first time inclusion of M/K, CSI and Plog ($2.6 million), overall increased business volume and a slight shift in product mix. For the six months ended June 30, 1996 cost of revenues increased 52% to $21.9 million from $14.4 million last year primarily due to the 1996 acquisitions ($4.8 million), overall increased business volume and a slight shift in product mix. Selling, general and administrative expenses increased 47% in the second quarter to $9.0 million from $6.2 million in the same period last year. The principal contributing factors were the inclusion of the new acquisitions ($2.1 million), acceleration of selected panel recruiting from the second half of this year into the second quarter, expenses related to the development of on-line interactive research activities, an increase in expenses associated with Payment Systems, Inc.'s London operations which began in the second quarter of 1995, and inflationary increases. For the six month period ended June 30, 1996 selling, general and administrative expenses increased 46% to $17.9 million from $12.2 million last year. The primary reasons for the increase were the inclusion of the new acquisitions ($3.8 million), increased staffing caused by increased business activity in both the U.S. and Europe, development of on-line interactive research activities, the acceleration of selected panel recruiting into the first half of 1996 and inflationary increases. As a result of the items above operating income for the quarter ended June 30, 1996 increased 46% to $4.4 million from $3.0 million, and for the first six months of 1996 increased 46% to $7.7 million from $5.3 million, compared to the same periods a year ago. Included this year for the first time are net operating losses associated with NFO's European joint venture activities now operating in France, Germany and the U.K., of $.1 million and $.3 million for the three and six month periods ended June 30, 1996, respectively. The Company's effective tax rate for the three and six month periods ended June 30, 1996 was 46.2%. For the three and six month periods ended June 30, 1995 the effective tax rates were 42.4% and 42.7%, respectively. These increases were primarily the result of increased non-deductible amortization of intangible assets associated with the Company's acquisitions, as well as the non deductible losses incurred in connection with the Company's European joint venture activities. 12 Net income for the second quarter of 1996 increased 30% to $2.2 million from $1.7 million in the same period last year. Primary earnings per share for the quarter increased 17% to $.21 from $.18 last year. Net income for the six months ended June 30, 1996 increased 31% to $3.9 million from $3.0 million a year ago. Primary earnings per share for the six month period increased 19% to $.37 from $.31 in the similar period last year. The increases in primary earnings per share for the quarter and six month period were primarily due to higher net income and occurred in spite of a greater number of outstanding shares caused primarily by the issuance of additional shares in connection with the recent acquisitions. LIQUIDITY AND CAPITAL RESOURCES Working capital as of June 30, 1996 was $8.5 million compared to $7.8 million at December 31, 1995. The slight increase in working capital was primarily the net effect of the results of operations for the first six months of 1996, the cash portion of the purchase price relating to the Company's acquisitions net of borrowings ($4.9 million), capital expenditures and investments in European joint venture activities. As of June 30, 1996 the Company had $2.0 million outstanding on its $50.0 million credit facility with three major U.S. banks. Capital expenditures for the quarter ended June 30, 1996 were $1.3 million compared to $.5 million for the same period last year. For the six months ended June 30, 1996 capital expenditures were $1.7 million compared to $.9 million a year ago. It is anticpiated that capital expenditures for 1996 will not exceed $4.0 million. The Company anticipates that existing cash, together with internally generated funds and its credit availabilities will provide the Company with the resources that are needed to satisfy potential acquisitions and the Company's growing working capital requirements. The timing and magnitude of future acquisitions will be the single most important factor in determining the Company's long term capital needs. 13 FORWARD LOOKING STATEMENTS Statements in this Form 10-Q relating to matters that are not historical facts are forward-looking statements. Such forward-looking statements are based on the Company's current forecasts and actual results may differ materially. To understand the risks which may affect the Company's future performance, please refer to Part 1 of NFO's 1995 Annual Report on Form 10-K. PART II OTHER INFORMATION ITEM 4 Submission of Matters to a Vote of Security Holders. The Company's Annual Meeting of Stockholders was held May 9, 1996. Three matters were submitted to a vote of the Company's stockholders at the Annual Meeting. First, the Company's directors, William E. Lipner, Steven J. Gilbert, Walter A. Forbes, Edmund A. Hajim and John Sculley were each reelected to a one year term. Mr. Lipner was reelected by a vote of 6,995,752 shares for reelection and 4,650 shares against, Mr. Gilbert was reelected by a vote of 6,995,602 shares for reelection and 4,800 against, Messrs. Forbes and Hajim were reelected by a vote of 6,996,202 shares for reelection and 4,200 against, and Mr. Sculley was reelected by a vote of 6,973,452 shares for reelection and 26,950 against. Second, the stockholders ratified the appointment of Arthur Andersen LLP as independent auditors of the Company for calendar year 1996 by a vote of 6,993,315 and 1,375 against, with 5,712 abstentions and 0 broker non-votes. Third, the stockholders, by a vote of 5,673,360 for and 1,034,018 against, with 25,924 abstentions and 267,100 broker non-votes, approved a proposal to amend the NFO Research, Inc. Stock Option Plan to increase the number of shares of Common Stock reserved for issuance thereunder to 1,875,000. ITEM 6 Exhibits and Reports on Form 8-K. (a) Exhibits 11. Computations of Net Income per Common Share 27. Financial Data Schedule (b) Reports on Form 8-K The Company did not file any reports on Form 8-K during the quarter for which this report is filed. 14 NFO RESEARCH, INC. SIGNATURE Pursuant to the requirements 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. NFO RESEARCH, INC. (Registrant) Dated: August 12, 1996 /s/ Patrick G. Healy --------------------------- Patrick G. Healy, Executive Vice President and Chief Financial Officer (Authorized Officer of Registrant and Principal Financial Officer) 15 NFO RESEARCH, INC. INDEX TO EXHIBITS SEQUENTIAL PAGE EXHIBITS NUMBER 11. Computations of Net Income Per Common Share 27. Financial Data Schedule EX-11 2 COMPUTATIONS OF NET INCOME PER COMMON SHARE NFO RESEARCH, INC. EXHIBIT 11 COMPUTATIONS OF NET INCOME PER COMMON SHARE (UNAUDITED, IN THOUSANDS, EXCEPT PER SHARE DATA) THREE MONTHS SIX MONTHS ENDED JUNE 30 ENDED JUNE 30 1996 1995 1996 1995 PRIMARY: - -------------- NET INCOME $2,240 $ 1,728 $ 3,941 $ 3,013 ====== ======= =============== WEIGHTED AVERAGE SHARES OUTSTANDING 10,167 9,381 10,133 9,351 DILUTIVE STOCK OPTIONS 513 261 472 236 OTHER COMMON SHARES EQUIVALENTS 33 33 33 33 10,713 9,675 10,638 9,620 ======= ====== ======= ====== PRIMARY EARNINGS PER SHARE .21 $.18 $ .37 $ .31 ================= ======= ====== FULLY DILUTED: - -------------- NET INCOME $ 2,197 $1,718 $ 3,854 $2,993 ======= ===== ======= ====== WEIGHTED AVERAGE SHARES OUTSTANDING 10,167 9,381 10,133 9,351 DILUTIVE STOCK OPTIONS 537 293 531 292 OTHER COMMON SHARES EQUIVALENTS 33 33 33 33 CONTINGENT SHARES 52 25 52 25 10,789 9,732 10,749 9,701 ======= ====== ======= ====== FULLY DILUTED EARNINGS PER SHARE $.20 $.18 $.36 $.31 ======= ======= ======= ====== THE EARNINGS PER SHARE AND SHARE DATA REFLECT THE THREE-FOR-TWO STOCK SPLIT EFFECTED ON FEBRUARY 5, 1996. EX-27 3 ART.5 FDS FOR 2ND QUARTER 10-Q
5 This schedule contains summary financial information extracted from the financial statements contained in NFO Research, Inc.'s report on Form 10-Q for the quarter ended June 30, 1996, and is qualified in its entirety by reference to such financial statements. 1,000 6-MOS DEC-31-1996 JUN-30-1996 2,304 0 22,337 138 0 27,249 15,388 5,154 85,343 18,737 3,421 102 0 0 59,312 85,343 49,750 49,750 21,859 42,045 373 1 231 7,332 3,391 3,941 0 0 0 3,941 .37 .36
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