DUN & BRADSTREET FILES SEC FORM 10 REGISTRATION; COMPLETES KEY STEP IN STRATEGIC RESTRUCTURING.NEW YORK--(BUSINESS WIRE)--Oct. 7, 1996-- Cognizant cog·ni·zant adj. Fully informed; conscious. See Synonyms at aware. [From cognizance.] Adj. 1. and ACNielsen Historical Financials and Forecast Capital Structures Reported The Dun & Bradstreet Corporation announced today that Form 10 registration statements for Cognizant Corporation and ACNielsen Corporation have been filed with the Securities and Exchange Commission. This is another milestone in Dun & Bradstreet's plan to create three independent companies: Cognizant Corporation, ACNielsen, and the 'new' Dun & Bradstreet. "The SEC Form 10 filing is a major step in finalizing Dun & Bradstreet's restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). ," said Robert E. Weissman, Dun & Bradstreet's chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "Our plan is on target for an early November spin-off The situation that arises when a parent corporation organizes a subsidiary corporation, to which it transfers a portion of its assets in exchange for all of the subsidiary's capital stock, which is subsequently transferred to the parent corporation's shareholders. of Cognizant Corporation and ACNielsen as separate, publicly traded companies publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. ." The Form 10 filings disclose historical financial results and forecasted capital structures for Cognizant Corporation and ACNielsen. Within two weeks of the dividend declaration, Dun & Bradstreet plans to file with the SEC its Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. , which will contain summary financial information about the 'new' Dun & Bradstreet Corporation. Dun & Bradstreet expects to declare a special dividend soon to its shareholders of one share of Cognizant common stock for each share of Dun & Bradstreet common stock, and one share of ACNielsen common stock for each three shares of D&B common stock held on the record date. After completion of the spin-off, shares of the three independent companies will trade on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. . Cognizant Corporation (NYSE NYSE See: New York Stock Exchange :CZT CZT Cadmium Zinc Telluride CZT Chirp Z-Transform CZT Community Z Tools CZT Concentric Zone Theory CZT Central Zone Time ) will focus on growth markets in the healthcare, high-tech and media industries. Its principal operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon are: IMS (1) See IP Multimedia Subsystem. (2) (Information Management System) An early IBM hierarchical DBMS for IBM mainframes. IMS was widely implemented throughout the 1970s under MVS and continues to be used under z/OS. International, the foremost global supplier of information solutions for the pharmaceutical and healthcare industries; Nielsen Media Research Nielsen Media Research (NMR) is an American firm that measures media audiences, including television, radio, theatre films (via the AMC MAP program) and newspapers. NMR, headquartered in New York City and operating primarily from Oldsmar, Florida, is best-known for the , the leader in audience measurement for electronic media; and a majority interest in Gartner Group (company) Gartner Group - One of the biggest IT industry research firms. Address: Connecticut, USA. , the premier provider of research and advisory services advisory services advisory services provided to the public, in their capacity as owners and managers of animals, are an important part of veterinary science. They may be provided by government bureaux, by commercial companies who deal in pharmaceuticals or animals or animal to the information technology industry. ACNielsen Corporation (NYSE:ART) is a global leader in delivering marketing research, information and analysis to the consumer products and service industries. The 'new' Dun & Bradstreet Corporation (NYSE:DNB DNB Dictionary of National Biography DNB Drum N Bass (music) DNB De Nederlandsche Bank DNB Dun & Bradstreet (stock symbol) DNB Den Norske Bank DNB David Nelson Band ) will consist of Dun & Bradstreet Information Services See Information Systems. , the leading provider of commercial credit and business marketing information and receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed management services; Moody's Investors Service Moody's Investors Service A leading global credit rating, research and risk analysis firm. Moody's Investors Service A leading firm engaged in credit rating, risk analysis, and research of fixed-income securities and their issuers. , the debt rating agency and a major publisher of financial information for investors; and Reuben H. Donnelley, the largest independent marketer of Yellow Pages advertising in the U.S. To assist with financial analysis of the Form 10 registration statements, Cognizant and ACNielsen have provided supplementary information. Cognizant's financial schedules are attached. ACNielsen's financial schedules are contained in a separate ACNielsen press release. The Dun & Bradstreet Corporation is the world's largest marketer of information, software and services for business decision making, with worldwide revenue of $5.4 billion in 1995. Cognizant Corporation Summary Financial Information Today's Form 10 filing with the SEC disclosed historical financial statements for Cognizant Corporation that show operating results as though the company were a separate entity from D&B. These financial statements conform with SEC reporting requirements, and consequently differ from pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma results that D&B released in January. (Refer to Schedule 1.) Cognizant has provided supplementary financial information attached as separate schedules. Based on SEC Form 10 financials as submitted, they provide additional information showing comparable 1995 and 1996 operating results for the business portfolio on a continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the basis. (Refer to Schedules 2, 3 and 4.) All discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , one-time charges and gains, and non-recurring items have been eliminated from these results. Portfolio additions and a lower effective tax rate based on global tax planning Tax planning Devising strategies throughout the year in order to minimize tax liability, for example, by choosing a tax filing status that is most beneficial to the taxpayer. actions are incorporated. Operating financials by business are shown separately for IMS International, Nielsen Media Research and Gartner Group in Schedules 5 and 6. This information augments the Form 10, which is limited to combined results for the Marketing Information Services and Information Technology Services segments. Business performance in the first half of 1996 is at or above revenue and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. growth expectations in all major divisions, particularly Gartner Group. The 1996 and 1997 business performance outlook remains strong, and is consistent with original projections. Cognizant Corporation had revenues of $785.7 million for the first six months of 1996, an increase of 15% from $682.9 million reported for the same period in 1995. Operating income for the first half of 1996 was $139.5 million, a 24% improvement over $112.1 million in 1995. Cognizant posted net income of $91.5 million, or $0.54 per share, during the first six months of 1996, compared with $77.6 million, or $0.46 per share, in 1995. For the year ended December 31, 1995, Cognizant Corporation's revenues totaled $1.5 billion with net income of $208.1 million, or $1.23 per share, on a continuing operations basis. For 1996, Cognizant anticipates revenue growth rate in the mid-teens and earnings per share growth at the upper end of the 17% to 20% range. The company's opening balance sheet is projected to include $454.6 million in cash and cash equivalents, and long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. of $10.5 million. Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. is estimated at $799.0 million. Cognizant will have 170.1 million shares outstanding. Cognizant Corporation is headquartered in Westport, Conn. -0- Schedule 1. Combined Statement of Operations See Income statement. for the six months ended June 30, 1996 and 1995, and for the full year ended December 31, 1995 on SEC Form 10 basis. Schedule 2. Combined Statement of Operations for the six months ended June 30, 1996. This schedule reconciles from the Form 10 to continuing operations results for the first six months of 1996. The reconciliation eliminates the impact of discontinued operations, and incorporates the benefit of global tax planning actions in a lower effective tax rate. Schedule 3. Combined Statement of Operations for the six months ended June 30, 1996. This schedule reconciles from the first half of 1996 management pro formas to continuing operations results. Schedule 4. Combined Statement of Operations for the year ended December 31, 1995. This schedule reconciles from the Form 10 to continuing operations results for 1995. The reconciliation eliminates the impact of discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: operations, one-time charges and one-time gains, and other non-recurring items, and reflects the benefit of global tax planning actions in a lower effective tax rate. Schedule 5. Operations by Business for the three months ended March 31, 1996 and June 30, 1996, and the six months ended June 30, 1996. This schedule shows continuing operations results by major line of business. Schedule 6. Operations by Business by quarter and for the full year ended December 31, 1995. This schedule shows continuing operations results by major line of business. Schedule 7. Capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. . This schedule shows Cognizant's forecast capital structure as disclosed in the Form 10. -0- SCHEDULE 1 COGNIZANT CORPORATION COMBINED STATEMENT OF OPERATIONS SECURITIES AND EXCHANGE COMMISSION FORM 10 BASIS (Amounts in Thousands except EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ) Six Months Ended June 30, Year Ended 1996 1995 December 31 (Unaudited) (Unaudited) 1995 Operating Revenue operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. $ 785,722 $ 709,749 $ 1,542,340 Operating Costs operating costs npl → gastos mpl operacionales 644,832 594,842 1,387,663 Operating Income 140,890 114,907 154,677 Non-Operating Income/(Expense) - Net (4,903) 577 7,880 Income Before Provision for Income Taxes 135,987 115,484 162,557 Provision for Income Taxes (59,835) (52,341) (73,676) Net Income $ 76,152 $ 63,143 $ 88,881 Pro Forma Unaudited Earnings Per Share of Common Stock $ .45 $ .37 $ .52 Pro Forma Unaudited Average Number of Shares Outstanding 169,808 169,638 169,522 Note: The above schedule should be read in conjunction with the Securities and Exchange Commission Form 10 Information Statement. -0- SCHEDULE 2 COGNIZANT CORPORATION COMBINED STATEMENT OF OPERATIONS RECONCILIATION OF FORM 10 TO CONTINUING OPERATIONS RESULTS (Amounts in Thousands except for EPS) Six Month Period Ended June 30, 1996 (unaudited) Continuing Reconciling Operations Form 10 Items Results Revenue $785,722 $785,722 Operating Income $140,890 $(1,439)(1) $139,451 Non-Operating Income\(Expense) ($4,903) ($4,903) Pre-Tax Income 135,987 (1,439) 134,548 Provision for Income Taxes (59,835) 16,780 (2) (43,055) Net Income $76,152 $15,341 $91,493 Pro Forma Unaudited Earnings $ .45 $ .09 $ .54 Per Share of Common Stock Pro Forma Unaudited Average Number of Shares Outstanding ('000) 169,808 169,808 169,808 Reconciling Items: (1) Discontinued Operations: Reconciling items include the discontinuation dis·con·tin·u·a·tion n. A cessation; a discontinuance. Noun 1. discontinuation - the act of discontinuing or breaking off; an interruption (temporary or permanent) discontinuance of D&B Japan (scheduled to be closed October 1, 1996). (2) Tax Provision: Cognizant's effective tax rate for the six months ended June 30, 1996 has been computed on a separate company basis in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the SEC accounting rules for Form 10. The tax rate on the SEC basis for the six months ended June 30, 1996 was 44.0%. However, this rate does not reflect the benefit of global tax planning actions currently underway, that should result in lower taxes. Accordingly, the $16,780 reconciling item results in a proforma Proforma A financial projection based on assumptions. tax rate of 32% for the six months ended June 30, 1996. -0- SCHEDULE 3 COGNIZANT CORPORATION COMBINED STATEMENT OF OPERATIONS RECONCILIATION OF FIRST-HALF PROFORMAS TO CONTINUING OPERATIONS RESULTS (Amounts in Thousands except for EPS) Six Month Period Ended June 30, 1996 (unaudited) Continuing First-Half Reconciling Operations Pro Formas Items Results Revenue $776,900 $ 8,822(1) $785,722 Operating Income $145,300 $(5,849)(2) $139,451 Non-Operating Income\(Expense) (1,200) (3,703)(3) (4,903) Pre-Tax Income 144,100 (9,552) 134,548 Provision for Income Taxes (46,100) 3,045 (4) (43,055) Net Income $98,000 $(6,507) $91,493 Pro Forma Unaudited Earnings Per Share of common stock $ .58 $ (.04) $ .54 Pro Forma Unaudited Average Number of Shares Outstanding ('000) 169,808 169,808 169,808 Reconciling Items: (1) Portfolio Additions: $8,822 in revenue is generated by additions to the Cognizant portfolio of business units based on management decisions made subsequent to the January 9, 1996 launch. Additions include Lexecon Healthcare, Cognizant Technology Asia (based in Japan), Cognizant Product Services (India), and TAM Canada, previously a unit of ACNielsen, all of which are included in the Form 10. (2) Portfolio Additions: ($1,200) in operating income is due to the addition of business units specified in item 1) above, and Cognizant Enterprises, also included in the Form 10. Run-Rate Changes: ($4,649) represents additional run-rate expenses which will be reflected in Cognizant's operating income for 1996 (which are incorporated into the Form 10). They include increased employee benefits costs based on actual benefits costs, and increased expense due to the break-up of D&B synergy The enhanced result of two or more people, groups or organizations working together. In other words, one and one equals three! It comes from the Greek "synergia," which means joint work and cooperative action. initiatives such as shared data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a , transaction services, telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. , and real estate. (3) Interest Income: Reflects lower interest income due to lower proceeds from the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of certain D&B businesses and the elimination of interest income from D&B companies that will not continue in the future (as presented in the Form 10). (4) Tax Provision: The reconciling item reflects the impact of the above mentioned items at the same tax rate of 32%. -0- SCHEDULE 4 COGNIZANT CORPORATION STATEMENT OF OPERATIONS (Amounts in Thousands except for EPS) Year Ended December 31, 1995 (Unaudited) Continuing Reconciling Operations Form 10 Items Results Revenue $ 1,542,340 $(34,390) (1) $ 1,507,950 Operating Income $154,677 $147,760 (2) $302,437 Non-Operating Income\(Expense) 7,880 (13,073) (3) (5,193) Pre-Tax Income 162,557 134,687 297,244 Provision for Income Taxes (73,676) (15,497) (4) (89,173) Net Income $88,881 $119,190 $208,071 Pro Forma Unaudited Earnings $ .52 $ .71 $ 1.23 Per Share of Common Stock Pro Forma Unaudited Average 169,522 169,522 169,522 Number of Shares Outstanding ('000) Reconciling Items: (1) Discontinued Operations: A reconciling item of ($9,900) in revenue relates to the discontinuance Cessation; ending; giving up. The discontinuance of a lawsuit, also known as a dismissal or a non-suit, is the voluntary or involuntary termination of an action. DISCONTINUANCE, pleading. A chasm or interruption in the pleading. 2. of certain operations at Sales Technologies, a unit of IMS America, and the transfer of GIS/Midas to ACNielsen. Fiscal Year Conformance con·for·mance n. Conformity. Noun 1. conformance - correspondence in form or appearance conformity agreement, correspondence - compatibility of observations; "there was no agreement between theory and : A reconciling item of ($24,490) in revenue principally reflects the one-time impact of conforming fiscal quarters between D&B and Gartner Group. (2) Discontinued Operations: A reconciling item of $15,100 in operating income relates to the discontinuance of operations specified in item 1) above, costs related to the closedown close·down n. A suspension or termination of operations: a plant closedown. Noun 1. closedown - termination of operations; "they regretted the closure of the day care center" of D&B Japan, and the closedown of the Marketing Information Services division at IMS. Fiscal Year Conformance: A reconciling item of ($4,073) in operating income principally reflects the one-time impact of conforming fiscal quarters between D&B and Gartner Group. One-Time Charges: A reconciling item of $135,370 relates to the non-recurring charge of $90,070 for costs principally associated with asset impairments, software write-off's and contractual obligations that have no future economic benefit, an incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. provision for postemployment benefits expense of $32,500, and a $12,800 restructuring provision to write-off software for product lines that were discontinued at Sales Technologies. Other Non-Recurring Items: A reconciling item of $1,363 relates primarily to non-recurring FAS 112 costs at IMS. (3) Non-Operating Income/(Expense): A reconciling item of ($1,200) relates to interest received from D&B transactions that will not be recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. in Cognizant after the spin date. A reconciling item of $3,251 reflects charges to/from D&B divisions that will cease after the spin date. One-Time Gains: A reconciling item of ($15,124) relates to non-recurring gains associated with previously divested businesses. (4) Tax Provision: Cognizant's effective tax rate for the year ended December 31, 1995 has been computed on a separate company basis in accordance with the SEC accounting rules for Form 10. The tax rate on the SEC basis for the year ended December 31, 1995 was 45.3%. However, this rate does not reflect the benefit of global tax planning actions. Accordingly, the $15,497 reconciling item results in a proforma tax rate of 30% for the year ended December 31, 1995. -0- SCHEDULE 5 COGNIZANT CORP. OPERATIONS BY BUSINESS CONTINUING OPERATIONS RESULTS (Amounts in Thousands except EPS) Six Months Three Months Ended Ended 3/31/96 6/30/96 6/30/96 (Unaudited) (Unaudited) (Unaudited) OPERATING REVENUE Marketing Information Services Segment: IMS International $191,080 $212,337 $403,417 Nielsen Media 76,821 78,194 155,015 Emerging Markets 17,371 20,862 38,233 TOTAL 285,272 311,393 596,665 Information Technology Services Segment: Gartner Group 84,747 104,310 189,057 TOTAL COGNIZANT $370,019 $415,703 $785,722 OPERATING INCOME Marketing Information Services Segment: IMS International $33,689 $48,256 $81,945 Nielsen Media 23,539 24,621 48,160 Emerging Markets (5,221) (4,459) (9,680) TOTAL 52,007 68,418 120,425 Information Technology Services Segment: Gartner Group 17,367 23,299 40,666 TOTAL SEGMENTS 69,374 91,717 161,091 Corporate and Other (10,498) (11,142) (21,640)(1) TOTAL OPERATING INCOME $58,876 $80,575 $139,451 NET INCOME $40,339 $51,154 $91,493 Pro Forma Unaudited Earnings Per Share of Common Stock $.24 $.30 $.54 Pro Forma Unaudited Average Number of Shares Outstanding 169,669 170,057 169,808 (1) Includes corporate overhead expenses of $17.0 million and other expenses, such as incremental data processing and employee benefit costs, of $4.6 million that are not reflected in the continuing operations of the business segments. -0- SCHEDULE 6 COGNIZANT CORPORATION OPERATIONS BY BUSINESS - QUARTERLY CONTINUING OPERATIONS RESULTS (Amounts in Thousands except EPS) Three Months Ended 3/31/95 6/30/95 9/30/95 12/31/95 Full Year (Unaudited)(Unaudited)(Unaudited)(Unaudited) 1995 OPERATING REVENUE Marketing Information Services Segment: IMS International $175,638 $193,871 $199,490 $252,759 $821,758(1) Nielsen Media 68,530 70,364 73,141 76,617 288,652 Emerging Markets 16,738 15,749 17,709 25,665 75,861 TOTAL 260,906 279,984 290,340 355,041 1,186,271 Information Technology Services Segment: Gartner Group 65,261 76,715 80,133 99,570 321,679 TOTAL COGNIZANT $326,167 $356,699 $370,473 $454,611 $1,507,950 OPERATING INCOME Marketing Information Services Segment: IMS International $ 30,318 $ 45,463 $ 47,074 $ 76,039 $198,894 Nielsen Media 20,685 22,218 22,464 24,001 89,368 Emerging Markets (2,987) (1,173) (1,180) 3,554 (1,786) TOTAL 48,016 66,508 68,358 103,594 286,476 Information Technology Services Segment: Gartner Group 10,602 12,849 13,793 18,574 55,818 TOTAL SEGMENTS 58,618 79,357 82,151 122,168 342,294 Corporate and Other (10,204) (15,671) (5,621) (8,361) (39,857)(2) TOTAL OPERATING INCOME $48,414 $ 63,686 $ 76,530 $113,807 $302,437 NET INCOME $33,265 $ 44,367 $ 53,197 $ 77,242 $208,071 Pro Forma Unaudited Earnings Per Share of Common Stock $ .20 $ .26 $ .31 $ .46 $ 1.23 Pro Forma Unaudited Average Number of Shares Outstanding 169,723 169,681 169,598 169,351 169,522 (1) IMS International revenue reflects the inclusion of Sales Technologies continuing operations and the transfer of GIS/MIDAS to ACNielsen. (2) Includes corporate overhead expenses of $33.9 million and other expenses of $6.0 million that are not reflected in the continuing operations results of the business segments. -0- SCHEDULE 7 COGNIZANT CORPORATION CAPITALIZATION (Amounts in Millions) (Unaudited) Forecasted at Forecasted at June 30, 1996 November 1, 1996 November 1, 1996 Actual Before Distribution After Distribution(1) Cash and Cash Equivalents $184.1 $225.0 $454.6 Marketable Securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has - held to maturity $60.7 $60.7 $60.7 Equity Marketable Marketable are securities that can be easily converted into cash. Such securities will generally have highly liquid markets allowing the security to be sold at a reasonable price very quickly. Securities - available for sale - - $29.2 Notes Payable - - $55.0 Long-term Debt $6.2 $10.5 $10.5 Divisional Equity: Foreign Currency Translation (2.2) (2.2) (2.2) Other Divisional Equity 629.4 666.4 - Common Stock, par value $.01 per share, authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: - 400,000,000 shares: issued - 170,890,834 - - 1.7 Capital in Excess of Par Value - - 823.5 Treasury Stock - 800,000 shares - - (24.0) Total Equity 627.7 664.2 799.0 Total Capitalization $633.9 $674.7 $864.5 CONTACT: Joseph C. Allen, 203/222-4235 |
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