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INTERSOLV REPORTS SECOND QUARTER RESULTS; EARNINGS PER SHARE INCREASED 8 PERCENT

 ROCKVILLE, Md., Nov. 17 /PRNewswire/ -- INTERSOLV, Inc. (NASDAQ-NMS: ISLI), today reported operating results for the second fiscal quarter ended Oct. 31, 1993. Earnings per share were 13 cents compared to 12 cents in the same period last year. Revenues were $20.5 million, which represented a 3 percent decline from the October quarter last year. Foreign currency exchange rates negatively impacted revenue by $0.5 million in this year's quarter.
 For the six-month period ended Oct. 31, 1993, Intersolv's earnings per share were 18 cents, up 6 percent from the same period last year. Revenues for the half were $37.1 million which represented a 6 percent decline compared to the same period last year. Foreign currency exchange rates negatively impacted first half revenue by $1.2 million.
 Kevin J. Burns, INTERSOLV's president/CEO, said: "Earnings were better than expected due to strong demand in North America where overall revenue grew 31 percent. In addition, our new client server development tools are being well received in the marketplace."
 INTERSOLV specializes in client/server software development. The company offers customers the benefits of one-stop shopping and single vendor service across a wide spectrum of client/server technologies. INTERSOLV products deliver high productivity on simple projects and are powerful enough to handle the scalability requirements of production- grade information systems without retooling. More than 150,000 developers use INTERSOLV solutions at more than 10,000 sites worldwide.
 INTERSOLV, INC.
 QUARTER TO QUARTER COMPARISON -- OPERATING RESULTS
 Three Months Ended Oct. 31
 (dollars in thousands, except per share amounts)
 Percent
 Q2 Increase Q2
 10/31/93 (Decrease) 10/31/92
 Revenues $20,507 (3) $21,193
 Costs & expenses:
 Cost of sales 1,799 30 1,389
 Sales & marketing 12,572 (3) 12,966
 Research & development 2,274 (10) 2,514
 General & administrative 1,702 (17) 2,050
 Total costs & expenses 18,347 (3) 18,919
 Operating income 2,160 (5) 2,274
 Other income, net 29 3X 10
 Pre-tax profit 2,189 (4) 2,284
 Taxes 657 (17) 796
 Net income $ 1,532 3 $ 1,488
 EPS $ 0.13 8 $ 0.12
 Shares used
 in computing EPS 12,039 (4) 12,536
 Key Data & Ratios:
 Net capitalized
 software benefit $ 461 ($1,000) $ 1,461
 Operating margin 11 pct. -- 11 pct.
 Tax rate 30 pct. -- 35 pct.
 Net margin 7 pct. -- 7 pct.
 INTERSOLV, INC.
 FIRST HALF COMPARISON -- OPERATING RESULTS
 Six Months Ended Oct. 31
 (dollars in thousands, except per share data)
 Percent
 First Half Increase First Half
 10/31/93 (Decrease) 10/31/92
 Revenues $37,058 (6) $39,236
 Costs & expenses:
 Cost of sales 3,340 24 2,695
 Sales & marketing 23,055 (6) 24,518
 Research & development 4,365 (8) 4,728
 General & administrative 3,335 (19) 4,121
 Total costs & expenses 34,095 (5) 36,062
 Operating income 2,963 (7) 3,174
 Other income, net 82 3.4X 24
 Pre-tax profit 3,045 (5) 3,198
 Taxes 914 (18) 1,116
 Net income $ 2,131 2 $ 2,082
 EPS $ 0.18 6 $ 0.17
 Shares used
 in computing EPS 12,016 (4) 12,535
 Key Data & Ratios:
 Net capitalized
 software benefit $ 824 ($2,058) $ 2,882
 Operating margin 8 pct. -- 8 pct.
 Tax rate 30 pct. -- 35 pct.
 Net margin 6 pct. -- 5 pct.
 INTERSOLV, INC.
 SEQUENTIAL COMPARISON -- OPERATING RESULTS
 Three Months Ended
 (dollars in thousands, except per share amounts)
 Percent
 Q1 Increase Q2
 7/31/93 (Decrease) 10/31/93
 Revenues $16,551 24 $20,507
 Costs & expenses:
 Cost of sales 1,541 17 1,799
 Sales & marketing 10,483 20 12,572
 Research & development 2,091 9 2,274
 General & administrative 1,633 4 1,702
 Total costs & expenses 15,748 17 18,347
 Operating income 803 2.7X 2,160
 Other income, net 53 -- 29
 Pre-tax profit 856 2.6X 2,189
 Taxes 257 2.6X 657
 Net income $ 599 2.6X $ 1,532
 EPS $ 0.05 2.6X $ 0.13
 Shares used
 in computing EPS 11,988 -- 12,039
 Key Data & Ratios:
 Net capitalized
 software benefit $ 363 $98 $ 461
 Operating margin 5 pct. -- 11 pct.
 Tax rate 30 pct. -- 30 pct.
 Net margin 4 pct. -- 7 pct.
 INTERSOLV
 BALANCE SHEET
 (in thousands)
 ASSETS: Oct. 31, 1993 April 30, 1993
 Current assets:
 Cash & cash equivalents $ 9,150 $ 9,017
 Accounts receivable, net 20,921 21,598
 Refundable income taxes 668 668
 Prepaid expenses & other assets 2,945 2,845
 Total current assets 33,684 34,128
 Software, net 16,377 15,553
 Property & equipment, net 7,015 8,080
 Notes receivable & other assets 1,500 1,624
 Total assets $58,576 $59,385
 LIABILITIES & STOCKHOLDERS' EQUITY:
 Current liabilities:
 Accounts payable & accrued expenses $12,294 $14,259
 Deferred revenue 9,351 10,486
 Total current liabilities 21,645 24,745
 Stockholders' equity 36,931 34,640
 Total liabilities
 & stockholders' equity $58,576 $59,385
 KEY FINANCIAL RATIOS:
 Days sales in receivables 97 days 92 days
 Current ratio 1.6X 1.4X
 INTERSOLV
 CASH FLOWS
 Six Months Ended
 (in thousands)
 First Half First Half
 CASH INFLOWS (OUTFLOWS) 10/31/93 10/31/92
 Operating activities:
 Net income $2,131 $2,082
 Non-cash items:
 Depreciation and amortization 3,615 3,114
 Deferred income taxes 820 421
 Changes in assets and liabilities (3,472) (507)
 Net cash provided
 by operating activities 3,094 5,110
 Investing activities:
 Additions to software (2,731) (4,484)
 Additions to property and
 equipment (1,815) (1,336)
 Sale/leaseback of equipment 1,252 --
 Changes in other assets 44 141
 Net cash used in investing activities (3,250) (5,679)
 Net cash provided
 by financing activities 429 787
 Effect of exchange rate changes on cash (140) (44)
 Increase in cash 133 174
 Cash, beginning of fiscal year 9,017 5,768
 Cash, end of period $9,150 $5,942
 -0- 11/17/93
 /CONTACT: Kevin J. Burns, president/CEO, 301-230-3201, or Kenneth A. Sexton, vice president-finance/CFO, 301-230-3210, both of INTERSOLV/
 (ISLI)


CO: INTERSOLV, Inc. ST: Maryland IN: CPR SU: ERN

KD-DS -- DC028 -- 5695 11/17/93 16:53 EST
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Date:Nov 17, 1993
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