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/C O R R E C T I O N -- SIERRA ON-LINE/

 /C O R R E C T I O N -- SIERRA ON-LINE/
 In LA031, "Sierra On-Line Reports a 50 Percent Increase in Second


Quarter Revenue," moved Thursday, Nov. 5, the first sentence of the third paragraph should read, "During the first six months of Sierra's fiscal year beginning April 1, 1991, net income after taxes totaled $809,000..." instead of "...net income taxes totaled $809,000," as originally issued. The corrected release follows:
 OAKHURST, Calif., Nov. 5 /PRNewswire/ -- Sierra On-Line (NASDAQ: SIER) announced today that revenue for the quarter ended Sept. 30, 1991 totaled $10.6 million. By comparison, revenue for the comparable quarter ended Sept. 30, 1990 was $7.1 million.
 Net income after taxes for the second fiscal quarter totaled $767,000, or $0.21 per share vs. $999,000, or $0.27 per share for the quarter ended Sept. 30, 1990. These EPS calculations do not reflect the 50 percent stock dividend which takes effect on the record date of Nov. 7.
 During the first six months of Sierra's fiscal year beginning April 1, 1991, net income after taxes totaled $809,000 or $0.22 per share, vs. $1.68 million or $0.46 per share for the same period of the prior year. Total revenue for the six months ended Sept. 30, 1991 increased by 39 percent. Revenue from product shipments improved over the same quarter one year ago due to strong market acceptance of "Police Quest III" and "Leisure Suit Larry 5."
 Ken Williams, Sierra's president and chief executive officer, said, "Our strong revenue growth is a direct result of our expanded R&D and marketing efforts. Costs associated with the upcoming launch of our educational product line and our newest subsidiary, "The Sierra Network (TSN)" have impacted earnings. Spending on TSN will remain flat throughout the year, as originally forecast. Since revenues skew towards the latter half of our fiscal year, I expect the impact on earnings to lessen during our next two quarters.
 "Looking forward, there are several indications that our upward trend in revenue growth will continue through our second half. 'Police Quest III' and 'Leisure Suit Larry 5' are topping the charts at many retailers. Our CD-ROM titles are outperforming our estimates. Our first two educational products look like they will be major successes. And, most importantly, we are benefiting from the rapidly dropping prices on 386 (R)-based personal computers."
 Sierra On-Line Inc., with its wholly owned subsidiary Dynamix, is a major publisher of premium-priced interactive entertainment software for the high-end of the personal computer market, primarily MS-DOS compatible computers.
 SIERRA ON-LINE INC. AND SUBSIDIARIES
 Consolidated Statement of Earnings
 (Unaudited)
 (in thousands, except per share data)
 Three months ended
 Sept. 30,
 1991 1990
 Revenues
 Net sales $10,251 6,160
 Interest income 99 247
 Other 269 665
 Total revenues $10,619 $7,072
 Cost of sales
 Manufacturing costs 3,650 2,122
 Amortization of software
 development costs 1,282 214
 Royalties 422 453
 Total cost of sales 5,354 2,789
 Operating expenses
 Selling, general and
 administrative 3,480 2,349
 Research and development 503 294
 Other expenses 26 2
 Total operating expenses 4,009 2,645
 Earnings before income taxes 1,256 1,638
 Income taxes 489 639
 Net earnings $767 $999
 Net earnings per common and
 common equivalent share $0.21 $0.27
 Average outstanding
 common and common
 equivalent shares 3,707,538 3,714,152
 Six months ended
 Sept. 30,
 1991 1990
 Revenues
 Net sales $16,288 $10,753
 Interest income 212 433
 Other 710 1,168
 Total revenues $17,210 $12,354
 Cost of sales
 Manufacturing costs 6,100 3,643
 Amortization of software
 development costs 2,031 218
 Royalties 647 821
 Total cost of sales 8,778 4,682
 Operating expenses
 Selling, general and
 administrative 6,244 4,240
 Research and development 825 665
 Other expenses 42 6
 Total operating expenses 7,111 4,911
 Earnings before income taxes 1,321 2,761
 Income taxes 512 1,078
 Net earnings $809 $1,683
 Net earnings per common and
 common equivalent share $0.22 $0.46
 Average outstanding
 common and common
 equivalent shares 3,745,467 3,692,199
 Consolidated Condensed Balance Sheet
 (Unaudited)
 (In thousands)
 Sept. 30, March 31,
 1991 1991
 Assets
 Current assets:
 Cash and cash equivalents $1,171 $2,907
 Marketable investment
 securities $4,950 $4,961
 Accounts receivable (net) 6,955 5,448
 Inventories 3,993 4,289
 Deferred income tax benefit 1,531 1,531
 Other current assets 1,018 799
 Total current assets 19,618 19,935
 Property, plant &
 equipment (net) 6,870 6,358
 Software development costs 6,430 3,965
 Goodwill 1,884 2,037
 Other assets 216 133
 Total assets $35,018 $32,428
 Liabilities and shareholders'
 equity:
 Current liabilities
 Accounts payable and other
 accrued expenses $4,882 $2,781
 Royalties payable 727 1,090
 Total current liabilities 5,609 $3,871
 Deferred income
 tax liability 1,817 1,817
 Other liabilities 144 324
 Total liabilities 7,570 6,012
 Shareholders' equity 27,448 26,416
 Total liabilities
 and shareholders equity $35,018 $32,428
 -0- 12/3/91
 /CONTACT: Bruce E. Grant, VP-finance, of Sierra On-Line, 209-683-4468/
 (SIER) CO: Sierra On-Line ST: California IN: CPR SU: ERN


CH -- LA016 -- 8737 12/03/91 11:57 EST
COPYRIGHT 1991 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Date:Dec 3, 1991
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