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CONTROL DATA SYSTEMS ANNOUNCES INCREASED SECOND QUARTER PROFITS; COMPANY RECORDS FOUR CONSECUTIVE PROFITABLE QUARTERS SINCE SPIN-OFF

 ARDEN HILLS, Minn., July 28 /PRNewswire/ -- Control Data Systems, Inc. (NASDAQ:CDAT) today reported 1993 second quarter net earnings of $4.3 million, or $.32 per share, on revenues of $114.9 million.
 For the 1992 second quarter, Control Data Systems had a net loss of $137.5 million, or $12.93 per share, on revenues of $132.3 million. That loss included approximately $130 million in restructuring and other charges, recorded in the 1992 second quarter, which were related to the separation of Control Data Systems from Ceridian Corporation in July 1992.
 "When we separated from Ceridian a year ago, we established several major objectives, with the primary goal of consistent profitability," said Jim Ousley, president and CEO of Control Data Systems, Inc. "We are pleased to have now achieved four consecutive quarters of profitability. In addition, we continue to make good progress in our transition to an open systems integration business, which we expect to continue to represent an increasing majority of our revenues."
 During the 1993 second quarter, Control Data Systems completed its acquisition of Evernet Systems, Inc., a U.S. network systems integration company. Control Data Systems also finalized its acquisition of a Norwegian PC integration company, DataSelskapet A/S, during the quarter.
 In June 1993, Control Data Systems announced its intent to acquire Antares Electronics Inc., a Canadian systems integration company specializing in microcomputer-based solutions in the areas of enterprise-wide networking and integration. These acquisitions continue to increase Control Data's opportunities in PC networking integration and open systems markets.
 As part of Control Data's efforts to expand its commercial systems integration business, the company also recently signed a commercial systems integrator (CSI) agreement with Sun Microsystems to remarket Sun's(TM) complete line of workstations, servers, and software worldwide.
 "We expect Sun to be a major supplier of commercial client/server systems for our integration projects," said Ousley. "We have signed our first major commercial contract utilizing Sun servers, a $10 plus million integration contract with a major Midwestern bank."
 During the second quarter, Control Data Systems also entered into a $10 million revolving credit agreement with First Bank National Association and the Bank of New York.
 "We are pleased with our progress in this first year as an independent company," said Ousley. "While there are challenges ahead of us, including depressed market conditions in Europe, we are well positioned, with sound financial underpinnings, a solid, growth-oriented business strategy, and an experienced worldwide management team."
 Control Data Systems, Inc. is a global systems integrator, applying the skills and experience of its computer professionals -- "Control Data Brainware(TM)" -- to the implementation of open systems solutions for the operational problems of customers worldwide. The company focuses its expertise on integrating computer solutions to business specific problems, primarily in manufacturing design, network communication, and database management.
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 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Dollars in thousands, except per share data)
 Control Data Systems, Inc.
 Three Months Ended Six Months Ended
 7/3/93 6/30/92 7/3/93 6/30/92
 Revenues $114,901 $132,287 $217,646 $250,426
 Cost of Revenues 69,557 82,917 129,590 154,828
 Gross Profit 45,344 49,370 88,056 95,598
 Operating Expenses:
 Selling, General and
 Administrative 34,394 44,379 67,940 86,508
 Technical 8,834 13,894 17,822 27,813
 Change in the Valuation
 of Spare Parts Inventory -- 14,900 -- 14,900
 Restructuring -- 114,900 -- 114,900
 Total Operating
 Expenses 43,228 188,073 85,762 244,121
 Earnings (Loss) from
 operation 2,116 (138,703) 2,294 (148,523)
 Other Income (Expense):
 Interest Expense (445) (694) (1,133) (1,214)
 Interest Income 1,595 441 3,389 671
 Other Income (Expense) 2,280 (1,219) 3,584 3,918
 Other Income (Expense),
 Net 3,430 (1,472) 5,840 3,375
 Earnings (Loss)
 Before Income Taxes 5,546 (140,175) 8,134 (145,148)
 Provision (Benefit) for
 Income Taxes 1,229 (2,669) 2,479 (912)
 Net Earnings (Loss) $4,317 $(137,506) $5,655 $(144,236)
 Net Earnings (Loss)
 per Common Share and
 Common Share Equivalents $0.32 $(12.93) $0.43 $(13.56)
 Weighted Average
 Common Shares
 Outstanding
 (in thousands) 13,290 10,637 13,299 10,635
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (Dollars in thousands)
 Control Data Systems, Inc.
 7/3/93 1/2/93
 ASSETS
 Current Assets:
 Cash and Cash Equivalents $116,406 $134,423
 Trade and Other Receivables 106,272 110,059
 Inventories 57,062 50,059
 Prepaid Expenses and Other Current Assets 6,836 8,720
 Total Current Assets 286,576 303,261
 Property and Equipment, Net 33,169 33,490
 Leased and Data Center Equipment, Net 7,214 9,958
 Other Noncurrent Assets 55,561 26,813
 Total Assets $382,520 $373,522
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current Liabilities:
 Short-Term Debt $13,167 $2,643
 Restructure Reserves, Current Portion 18,562 29,000
 Other Accrued Expenses 117,195 110,802
 Total Current Liabilities 148,924 142,445
 Deferred Income Taxes 857 379
 Restructure Reserves, less Current Portion 26,552 31,398
 Pension Liabilities 29,160 30,325
 Other Noncurrent Liabilities 2,906 9,768
 Total Liabilities 208,399 214,315
 Stockholders' Equity 174,121 159,207
 Total Liabilities and Stockholders' Equity $382,520 $373,522
 -0- 7/28/93
 /CONTACT: Charlotte Fransen, media relations, 612-482-4857, or Jerry Johnson, investor relations, 612-482-2125, both of Control Data Systems/
 (CDAT)


CO: Control Data Systems, Inc. ST: Minnesota IN: CPR SU: ERN

DB -- MN002 -- 6601 07/28/93 08:33 EDT
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Publication:PR Newswire
Date:Jul 28, 1993
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