UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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Quarterly Report pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934 |
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for the quarter ended March 31, 2003 or |
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Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
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for the transition period from to . |
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Commission File Number 0-22844 |
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SYLVAN LEARNING SYSTEMS, INC. |
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(Exact name of registrant as specified in its charter) |
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Maryland |
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52-1492296 |
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(State or other jurisdiction of |
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(I.R.S. Employer |
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1001 Fleet Street, Baltimore, Maryland |
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21202 |
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(Address of principal executive offices) |
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(Zip Code) |
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Registrant’s telephone number, including area code: (410)843-8000 |
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Indicate 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 ý. No o.
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes ý. No o
The registrant had 40,976,115 shares of Common Stock outstanding as of May 12, 2003.
SYLVAN LEARNING SYSTEMS, INC.
INDEX
2
SYLVAN LEARNING SYSTEMS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollar and share amounts in thousands, except per share data)
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March 31, |
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December
31, |
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(Unaudited) |
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(Restated) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
91,860 |
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$ |
98,618 |
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Available-for-sale securities |
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23,726 |
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22,546 |
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Receivables: |
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Accounts receivable |
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80,595 |
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68,439 |
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Notes receivable |
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14,315 |
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11,270 |
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Other receivables |
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6,274 |
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7,566 |
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101,184 |
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87,275 |
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Allowance for doubtful accounts |
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(13,486 |
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(9,620 |
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87,698 |
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77,655 |
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Inventory |
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4,702 |
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3,955 |
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Deferred income taxes |
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7,354 |
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2,545 |
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Prepaid expenses and other current assets |
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22,486 |
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21,817 |
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Current assets of discontinued operations |
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92,260 |
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104,464 |
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Total current assets |
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330,086 |
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331,600 |
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Notes receivable, less current portion |
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14,898 |
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11,889 |
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Property and equipment: |
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Land |
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39,805 |
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38,028 |
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Buildings |
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162,314 |
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157,834 |
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Construction-in-progress |
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16,872 |
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14,496 |
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Furniture, computer equipment and software |
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96,750 |
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93,748 |
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Leasehold improvements |
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29,991 |
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28,747 |
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345,732 |
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332,853 |
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Accumulated depreciation |
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(56,041 |
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(50,623 |
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289,691 |
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282,230 |
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Intangible assets: |
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Goodwill |
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194,526 |
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193,301 |
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Other intangible assets, net of accumulated amortization of $2,893 and $2,530 at March 31, 2003 and December 31, 2002, respectively |
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36,157 |
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36,543 |
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230,683 |
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229,844 |
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Investments in and advances to affiliates |
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927 |
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8,730 |
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Other investments |
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4,778 |
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12,375 |
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Deferred income taxes |
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12,919 |
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10,231 |
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Deferred costs, net of accumulated amortization of $4,882 and $4,417 at March 31, 2003 and December 31, 2002, respectively |
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8,808 |
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6,600 |
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Other assets |
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19,703 |
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16,875 |
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Long-term assets of discontinued operations |
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55,000 |
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55,000 |
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Total assets |
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$ |
967,493 |
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$ |
965,374 |
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3
SYLVAN LEARNING SYSTEMS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (continued)
(Dollar and share amounts in thousands, except per share data)
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March 31, |
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December
31, |
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(Unaudited) |
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(Restated) |
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Liabilities and stockholders’ equity |
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Current liabilities: |
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Accounts payable |
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$ |
26,016 |
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$ |
28,171 |
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Accrued expenses |
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57,664 |
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55,315 |
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Income taxes payable |
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1,130 |
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12,680 |
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Current portion of long-term debt |
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12,099 |
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11,194 |
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Due to shareholders of acquired companies |
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8,859 |
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8,802 |
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Deferred revenue |
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92,343 |
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76,773 |
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Other current liabilities |
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4,071 |
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1,672 |
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Current liabilities of discontinued operations |
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36,370 |
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30,648 |
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Total current liabilities |
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238,552 |
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225,255 |
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Long-term debt, less current portion |
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151,915 |
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153,542 |
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Other long-term liabilities |
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26,546 |
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26,636 |
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Total liabilities |
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417,013 |
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405,433 |
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Minority interest |
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73,616 |
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74,013 |
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Stockholders’ equity: |
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Preferred stock, par value $0.01 per share—authorized 10,000 shares, no shares issued and outstanding as of March 31, 2003 and December 31, 2002 |
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— |
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— |
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Common stock, par value $0.01 per share—authorized 90,000 shares, issued and outstanding shares of 40,958 as of March 31, 2003 and 40,331 as of December 31, 2002 |
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410 |
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403 |
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Additional paid-in capital |
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