Barra Reports 4th Quarter and Fiscal Year Results

Apr 25, 2001, 01:00 ET from Barra, Inc.

    BERKELEY, Calif., April 25 /PRNewswire/ -- Barra, Inc. (Nasdaq:   BARZ)
 today reported that net income for the March 2001 quarter increased 30 percent
 to $10.3 million or $.45 per diluted share as compared to $7.9 million or
 $.36 per diluted share for the same quarter a year ago (excluding
 restructuring charges of $3.5 million or $.10 per diluted share, and gain on
 sale of equity securities of $1.7 million or $.05 per diluted share).
 Consolidated revenues for the March 2001 quarter increased to $51.2 million
 from $44.5 million for the same quarter last year.  Net income for the
 March 2000 quarter, including restructuring charges and gain on sale of equity
 securities was $6.8 million or $.31 cents per diluted share.
     Consolidated revenues for the fiscal year ended March 31, 2001 were
 $224.4 million, up 20 percent over the prior year.  Net income for the year
 increased 64 percent to $46.0 million or $2.04 per diluted share (excluding
 the loss on sale of the estimates business of $1.1 million or $.03 per diluted
 share) compared to net income of $28.1 million or $1.28 per diluted share
 (excluding restructuring charges of $9.0 million or $.26 per diluted share and
 gain on sale of equity securities of $1.7 million or $.05 per diluted share in
 fiscal 2000).  Including these special items, net income for the year ended
 March 31, 2001 was $45.3 million or $2.01 per diluted share, up 93 percent
 from $23.4 million or $1.07 per diluted share for the year ended
 March 31, 2000.
     "We are pleased to end this fiscal year on such a strong note.  We
 produced record results across all of our major businesses, and the Core
 business in particular had a spectacular year with growth in earnings of over
 200 percent," said Kamal Duggirala, Barra's president and chief executive
 officer.  "The continuing trend towards professional management of assets
 combined with the momentum in revenue from a year of record net sales, gives
 us a strong platform for further success," he added.
 
     Core Business
     Revenues for the March 2001 quarter for portfolio and enterprise risk
 management products were $30.1 million, up 21 percent (or 22 percent after
 adjusting for the negative impact of changes in foreign currency translation
 rates) over the same quarter a year ago.  Recurring subscription revenues
 increased 26 percent and 24 percent, respectively, when compared to the same
 three and twelve month periods a year ago.  For the quarter ended
 March 31, 2001, compared to the same quarter a year ago, subscription revenues
 from enterprise risk management products increased 134 percent, and
 subscription revenues in the US and non-US markets grew approximately 33 and
 22 percent respectively.  Operating margins in the Core business grew from
 16 percent in the March 2000 quarter to 27 percent in the March 2001 quarter.
     Revenues from enterprise risk implementation projects and other one-time
 fees decreased approximately 15 percent in the March 2001 quarter as compared
 to the same quarter a year ago. Revenues from enterprise risk implementation
 projects can vary significantly from quarter to quarter as the timing of
 recording revenue is governed by the terms of the implementation contracts.
 
     Symphony Asset Management Venture
     Barra and the principals of Symphony Asset Management, LLC have decided to
 explore strategic alternatives for the future of the Symphony business.  Barra
 and Symphony's principals have engaged leading investment banking firms
 Goldman Sachs and Putnam Lovell Securities Inc., respectively, to assist with
 the process.  Symphony has been tremendously successful, and has now reached a
 stage where it is appropriate to look at the full range of opportunities for
 this business.
     Revenues from Symphony totaled $7.8 million for the March 2001 quarter, up
 10 percent from the same quarter last year.  Included in the March quarter
 results were approximately $1.6 million of performance-based fees from
 accounts where Symphony's investment performance exceeded agreed upon
 benchmarks.  This represents performance fees on approximately 13 percent of
 performance based funds.  Base fees for the March 2001 quarter were
 $6.2 million compared to $5.9 million for the same quarter last year.
     It is estimated that approximately 9 percent and 40 percent of the current
 total of performance-based funds under Symphony's management will have
 performance fee determination dates in the quarters ended June 30, 2001 and
 September 30, 2001, respectively.  The pattern of these anniversaries can
 change from quarter to quarter because of the addition, termination and
 renegotiation of account agreements.
     At March 31, 2001, Symphony had approximately $4.4 billion of assets under
 direct management.  Of the funds under Symphony's direct management,
 approximately $3.4 billion are now managed under agreements that provide for
 performance fees in addition to a base management fee.  These amounts include
 approximately $850 million of leverage associated with performance fee
 accounts in addition to the capital invested by Symphony clients.
 
     POSIT Venture
     Revenues from the Portfolio System for Institutional Trading (POSIT) joint
 venture for the March 2001 quarter increased 7 percent to $5.7 million
 compared to $5.3 million for the same quarter last year.  While revenues from
 EuroPOSIT declined, revenues from the US POSIT system increased 15 percent
 over the same quarter last year.
 
     Stock Repurchases
     As part of its previously announced stock repurchase program, the company
 repurchased 27,500 of its shares for a cost of approximately $1.3 million
 during the March 2001 quarter bringing the fiscal year total to 147,000 shares
 for approximately $6.0 million.
 
     Earnings Conference Call for March 2001 Quarter and Fiscal Year
     Barra will webcast its 4th Quarter and Fiscal Year earnings release
 conference call today at 11:00 am eastern time.  The live webcast will be
 broadcast via the StreetFusion website at www.streetfusion.com.  Those
 interested in accessing the live webcast may also link to the StreetFusion
 website via the investor relations section of Barra's website at
 www.barra.com.  Following the call, a replay will be made available via
 webcast on the StreetFusion website for one week.  The replay may also be
 accessed by telephone, for one week following the call, by dialing
 888-203-1112, passcode 587709.
     Barra is the global leader in delivering risk management systems and
 services to managers of portfolio and firm-wide investment risk.  Since its
 inception in 1975, Barra's single vision -- to empower its clients to make
 strategic investment decisions -- has made Barra the industry standard in
 investment risk management.  Headquartered in Berkeley, California, Barra has
 offices in all major financial centers around the world.
     This release contains forward-looking statements that reflect management's
 current views regarding future events and financial performance.  These
 statements are subject to risks and uncertainties and use forms of the words
 "estimate," "further," "change" and "vary."  Factors that could cause actual
 results to differ materially include:  variability of revenue streams in the
 core and venture businesses; the timing of performance fee determination dates
 for and the performance of the asset management business; disruption of
 operations or increases in expenses caused by a lack of continuous power
 supply in California; the inability to locate appropriate opportunities for
 Ventures businesses in a timely manner; and risks associated with business
 combinations, government regulation and competition.  These and other
 important factors are detailed in various Securities and Exchange Commission
 filings made periodically by the company, copies of which are available from
 the company without charge or online at http://www.barra.com.  Please review
 such filings and do not place undue reliance on these forward-looking
 statements.  The company undertakes no obligation to release publicly the
 result of any revisions to these forward-looking statements that may be made
 to reflect events or circumstances after the date of this press release or to
 reflect the occurrence of unanticipated events.
 
     Barra Inc. and Subsidiaries
      Condensed Consolidated Statements of Income
      For the Three (Unaudited) and Twelve Month Periods Ended March 31, 2001
       and 2000
     (In thousands except for share and per share amounts)
 
                                   Three Months Ended      Fiscal Year Ended
                                        March 31,               March 31,
                                    2001         2000       2001         2000
     Operating Revenues:
        Portfolio and
         Enterprise Risk
         Management                $30,091     $24,903    $111,260     $92,362
        Symphony                     7,819       7,124      61,835      46,901
        POSIT                        5,708       5,339      21,070      19,064
        Other Ventures               7,598       7,165      30,253      28,222
          Total operating
           revenues                 51,216      44,531     224,418     186,549
 
     Operating Expenses:
        Communications, data
         and seminar                 1,979       1,705       7,900       7,953
        Compensation and
         benefits                   24,687      21,338      95,468      87,825
        Occupancy                    1,823       1,726       7,450       7,195
        Other operating
         expenses                    7,824       6,760      28,575      25,680
        Loss on sale of
         Estimates business                                  1,064
        Restructuring charges                    3,463                   9,024
 
          Total operating
           expenses                 36,313      34,992     140,457     137,677
 
     Interest Income & Other         1,780       2,885       4,383       3,980
 
     Income before Equity in
      Net Income and Loss of
      Investees, Minority
      Interest and Income Taxes     16,683      12,424      88,344      52,852
 
     Equity in Net Income and
      Loss of Investees                 88         (40)        159        (113)
 
     Minority Interest                (949)     (1,987)    (18,816)    (15,824)
 
     Income before Income Taxes     15,822      10,397      69,687      36,915
 
     Income Taxes                   (5,538)     (3,639)    (24,385)    (13,479)
 
     Net Income                    $10,284      $6,758     $45,302     $23,436
 
     Net Income Per Share:
        Basic                        $0.48       $0.33       $2.17       $1.12
        Diluted                      $0.45       $0.31       $2.01       $1.07
 
     Weighted Average Common
      and Common Equivalent
      Shares:
        Basic                   21,236,170  20,671,571  20,921,413  20,979,645
        Diluted                 22,855,000  21,907,083  22,510,364  21,952,379
 
     Net Income Excluding
      Unusual Items                $10,284      $7,916     $45,988     $28,097
 
     Net Income Per Share
      Excluding Unusual
      Items - Diluted                $0.45       $0.36       $2.04       $1.28
 
     Barra, Inc. and Subsidiaries
      Condensed Consolidated Balance Sheets
      As of March 31, 2001 and 2000 (Amounts in thousands except
        for share and per share amounts)
                                                    March 31,        March 31,
                                                      2001             2000
 
     ASSETS
     Current Assets:
     Cash and cash equivalents                      $61,837           $53,320
     Investments in marketable equity
      trading securities                             15,848            13,334
     Investments in marketable debt
      securities available-for-sale                  76,523            14,090
     Accounts receivable:
       Subscription and other (Less
        allowance for doubtful accounts of
        $518 and $755)                               11,916            18,411
       Asset Management                              11,175             8,984
       Related parties                                6,221             7,392
     Prepaid expenses                                 2,675             2,116
         Total current assets                       186,195           117,647
 
     Investments in Unconsolidated Companies          4,849             1,775
     Premises and Equipment:
     Computer and office equipment                   15,491            20,909
     Furniture and fixtures                           6,263             6,029
     Leasehold improvements                           8,764             8,747
     Total premises and equipment                    30,518            35,685
     Less accumulated depreciation and
      amortization                                  (16,052)          (18,366)
                                                     14,466            17,319
     Deferred Tax Assets                              9,316             4,355
     Computer Software
     (Less accumulated amortization of
      $2,082 and $1,455)                              1,615             1,994
     Other Assets                                     1,139               832
     Goodwill and other Intangibles
     (Less accumulated amortization of
      $7,174 and $7,304)                              9,995            24,840
     TOTAL                                         $227,575          $168,762
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
     Current Liabilities:
       Accounts payable                                $850              $975
       Accrued expenses payable:
         Accrued compensation                        17,018            14,084
         Accrued corporate income taxes              11,816            13,437
         Accrued restructuring charges                   --             2,654
         Other accrued expenses                       8,602             9,966
     Unearned revenues                               29,682            26,579
         Total current liabilities                   67,968            67,695
 
     Deferred Tax Liabilities                         3,631             1,994
 
     Minority Interest in Equity of Subsidiary        1,249             2,287
 
     Stockholders' Equity:
     Preferred stock, no par; 10,000,000
      shares authorized; none issued and
      outstanding
     Common stock, $.0001 par value;
      75,000,000 shares authorized;
      21,327,015 and 20,513,325
       shares issued and outstanding                      2                 1
     Additional paid-in capital                      29,340            16,208
     Retained earnings                              125,623            80,321
     Accumulated other comprehensive
      income (loss)                                    (238)              256
       Total stockholders' equity                   154,727            96,786
     TOTAL                                         $227,575          $168,762
 
     Barra, Inc.
     SEGMENT INFORMATION
     FOR THE THREE AND TWELVE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED)
 
                                   THREE MONTHS ENDED MARCH 31, 2000
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management           24,903                                 --    24,903
     Symphony Asset
      Management                             7,124             7,124     7,124
     POSIT                          5,339                      5,339     5,339
     Other Ventures                                   7,165    7,165     7,165
       Total revenues      24,903   5,339    7,124    7,165   19,628    44,531
 
     Compensation and
      Benefits            (14,218)   (331)  (1,889)  (4,900)  (7,120)  (21,338)
     Other Segment
      Expenses             (6,659)    (58)  (1,313)  (2,161)  (3,532)  (10,191)
     Interest Income and
      Other                   337              866    1,682    2,548     2,885
     Equity in Joint
      Ventures and
      Minority Interest                (8)  (1,987)     (32)  (2,027)   (2,027)
     Loss on Sale of
      Estimates Business   (3,463)                                      (3,463)
       Total Segment
        expenses          (24,003)   (397)  (4,323)  (5,411) (10,131)  (34,134)
     Segment Income
      (Loss)                  900   4,942    2,801    1,754    9,497    10,397
 
 
                                   TWELVE MONTHS ENDED MARCH 31, 2000
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management           92,362                                --     92,362
     Symphony Asset
      Management                            46,901            46,901    46,901
     POSIT                         19,064                     19,064    19,064
     Other Ventures                                  28,222   28,222    28,222
       Total revenues      92,362  19,064   46,901   28,222   94,187   186,549
     Compensation and
      Benefits            (55,995) (1,175) (10,471) (20,184) (31,830)  (87,825)
     Other Segment
      Expenses            (27,159)   (320)  (4,871)  (8,478) (13,669)  (40,828)
     Interest Income and
      Other                 1,434              864    1,682    2,546     3,980
     Equity in Joint
      Ventures and
      Minority Interest               109  (15,824)    (222) (15,937)  (15,937)
     Restructuring
      Charges and Loss on
      Sale                                                                  --
       of Estimates
        Business           (9,024)                                      (9,024)
       Total Segment
        expenses          (90,744) (1,386) (30,302) (27,202) (58,890) (149,634)
     Segment Income
      (Loss)                1,618  17,678   16,599    1,020   35,297    36,915
 
     Barra, Inc.
     SEGMENT INFORMATION
     FOR THE THREE AND TWELVE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED)
 
                                   THREE MONTHS ENDED MARCH 31, 2001
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management           30,091                                       30,091
     Symphony Asset
      Management                             7,819             7,819     7,819
     POSIT                          5,708                      5,708     5,708
     Other Ventures                                   7,598    7,598     7,598
       Total revenues      30,091   5,708    7,819    7,598   21,125    51,216
     Compensation and
      Benefits            (14,265)   (445)  (4,098)  (5,879) (10,422)  (24,687)
     Other Segment
      Expenses             (7,726)   (250)  (1,912)  (1,738)  (3,900)  (11,626)
     Interest Income and
      Other                 1,277              503               503     1,780
     Equity in Joint
      Ventures and
      Minority Interest                       (949)      88     (861)     (861)
     Loss on Sale of
      Estimates Business                                          --        --
       Total Segment
        expenses          (20,714)   (695)  (6,456)  (7,529) (14,680)  (35,394)
 
     Segment Income
      (Loss)                9,377   5,013    1,363       69    6,445    15,822
 
                                   TWELVE MONTHS ENDED MARCH 31, 2001
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management          111,260                                      111,260
     Symphony Asset
      Management                            61,835            61,835    61,835
     POSIT                         21,070                     21,070    21,070
     Other Ventures                                  30,253   30,253    30,253
       Total revenues     111,260  21,070   61,835   30,253  113,158   224,418
 
     Compensation and
      Benefits            (53,944) (1,462) (18,983) (21,079) (41,524)  (95,468)
     Other Segment
      Expenses            (28,569)   (740)  (5,696)  (8,920) (15,356)  (43,925)
     Interest Income and
      Other                 3,193            1,190             1,190     4,383
     Equity in Joint
      Ventures and
      Minority Interest               183  (18,816)     (24) (18,657)  (18,657)
     Restructuring
      Charges and Loss on
      Sale
       of Estimates
        Business                                     (1,064)  (1,064)   (1,064)
       Total Segment
        expenses          (79,320) (2,019) (42,305) (31,087) (75,411) (154,731)
 
     Segment Income
      (Loss)               31,940  19,051   19,530     (834)  37,747    69,687
 
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SOURCE Barra, Inc.
    BERKELEY, Calif., April 25 /PRNewswire/ -- Barra, Inc. (Nasdaq:   BARZ)
 today reported that net income for the March 2001 quarter increased 30 percent
 to $10.3 million or $.45 per diluted share as compared to $7.9 million or
 $.36 per diluted share for the same quarter a year ago (excluding
 restructuring charges of $3.5 million or $.10 per diluted share, and gain on
 sale of equity securities of $1.7 million or $.05 per diluted share).
 Consolidated revenues for the March 2001 quarter increased to $51.2 million
 from $44.5 million for the same quarter last year.  Net income for the
 March 2000 quarter, including restructuring charges and gain on sale of equity
 securities was $6.8 million or $.31 cents per diluted share.
     Consolidated revenues for the fiscal year ended March 31, 2001 were
 $224.4 million, up 20 percent over the prior year.  Net income for the year
 increased 64 percent to $46.0 million or $2.04 per diluted share (excluding
 the loss on sale of the estimates business of $1.1 million or $.03 per diluted
 share) compared to net income of $28.1 million or $1.28 per diluted share
 (excluding restructuring charges of $9.0 million or $.26 per diluted share and
 gain on sale of equity securities of $1.7 million or $.05 per diluted share in
 fiscal 2000).  Including these special items, net income for the year ended
 March 31, 2001 was $45.3 million or $2.01 per diluted share, up 93 percent
 from $23.4 million or $1.07 per diluted share for the year ended
 March 31, 2000.
     "We are pleased to end this fiscal year on such a strong note.  We
 produced record results across all of our major businesses, and the Core
 business in particular had a spectacular year with growth in earnings of over
 200 percent," said Kamal Duggirala, Barra's president and chief executive
 officer.  "The continuing trend towards professional management of assets
 combined with the momentum in revenue from a year of record net sales, gives
 us a strong platform for further success," he added.
 
     Core Business
     Revenues for the March 2001 quarter for portfolio and enterprise risk
 management products were $30.1 million, up 21 percent (or 22 percent after
 adjusting for the negative impact of changes in foreign currency translation
 rates) over the same quarter a year ago.  Recurring subscription revenues
 increased 26 percent and 24 percent, respectively, when compared to the same
 three and twelve month periods a year ago.  For the quarter ended
 March 31, 2001, compared to the same quarter a year ago, subscription revenues
 from enterprise risk management products increased 134 percent, and
 subscription revenues in the US and non-US markets grew approximately 33 and
 22 percent respectively.  Operating margins in the Core business grew from
 16 percent in the March 2000 quarter to 27 percent in the March 2001 quarter.
     Revenues from enterprise risk implementation projects and other one-time
 fees decreased approximately 15 percent in the March 2001 quarter as compared
 to the same quarter a year ago. Revenues from enterprise risk implementation
 projects can vary significantly from quarter to quarter as the timing of
 recording revenue is governed by the terms of the implementation contracts.
 
     Symphony Asset Management Venture
     Barra and the principals of Symphony Asset Management, LLC have decided to
 explore strategic alternatives for the future of the Symphony business.  Barra
 and Symphony's principals have engaged leading investment banking firms
 Goldman Sachs and Putnam Lovell Securities Inc., respectively, to assist with
 the process.  Symphony has been tremendously successful, and has now reached a
 stage where it is appropriate to look at the full range of opportunities for
 this business.
     Revenues from Symphony totaled $7.8 million for the March 2001 quarter, up
 10 percent from the same quarter last year.  Included in the March quarter
 results were approximately $1.6 million of performance-based fees from
 accounts where Symphony's investment performance exceeded agreed upon
 benchmarks.  This represents performance fees on approximately 13 percent of
 performance based funds.  Base fees for the March 2001 quarter were
 $6.2 million compared to $5.9 million for the same quarter last year.
     It is estimated that approximately 9 percent and 40 percent of the current
 total of performance-based funds under Symphony's management will have
 performance fee determination dates in the quarters ended June 30, 2001 and
 September 30, 2001, respectively.  The pattern of these anniversaries can
 change from quarter to quarter because of the addition, termination and
 renegotiation of account agreements.
     At March 31, 2001, Symphony had approximately $4.4 billion of assets under
 direct management.  Of the funds under Symphony's direct management,
 approximately $3.4 billion are now managed under agreements that provide for
 performance fees in addition to a base management fee.  These amounts include
 approximately $850 million of leverage associated with performance fee
 accounts in addition to the capital invested by Symphony clients.
 
     POSIT Venture
     Revenues from the Portfolio System for Institutional Trading (POSIT) joint
 venture for the March 2001 quarter increased 7 percent to $5.7 million
 compared to $5.3 million for the same quarter last year.  While revenues from
 EuroPOSIT declined, revenues from the US POSIT system increased 15 percent
 over the same quarter last year.
 
     Stock Repurchases
     As part of its previously announced stock repurchase program, the company
 repurchased 27,500 of its shares for a cost of approximately $1.3 million
 during the March 2001 quarter bringing the fiscal year total to 147,000 shares
 for approximately $6.0 million.
 
     Earnings Conference Call for March 2001 Quarter and Fiscal Year
     Barra will webcast its 4th Quarter and Fiscal Year earnings release
 conference call today at 11:00 am eastern time.  The live webcast will be
 broadcast via the StreetFusion website at www.streetfusion.com.  Those
 interested in accessing the live webcast may also link to the StreetFusion
 website via the investor relations section of Barra's website at
 www.barra.com.  Following the call, a replay will be made available via
 webcast on the StreetFusion website for one week.  The replay may also be
 accessed by telephone, for one week following the call, by dialing
 888-203-1112, passcode 587709.
     Barra is the global leader in delivering risk management systems and
 services to managers of portfolio and firm-wide investment risk.  Since its
 inception in 1975, Barra's single vision -- to empower its clients to make
 strategic investment decisions -- has made Barra the industry standard in
 investment risk management.  Headquartered in Berkeley, California, Barra has
 offices in all major financial centers around the world.
     This release contains forward-looking statements that reflect management's
 current views regarding future events and financial performance.  These
 statements are subject to risks and uncertainties and use forms of the words
 "estimate," "further," "change" and "vary."  Factors that could cause actual
 results to differ materially include:  variability of revenue streams in the
 core and venture businesses; the timing of performance fee determination dates
 for and the performance of the asset management business; disruption of
 operations or increases in expenses caused by a lack of continuous power
 supply in California; the inability to locate appropriate opportunities for
 Ventures businesses in a timely manner; and risks associated with business
 combinations, government regulation and competition.  These and other
 important factors are detailed in various Securities and Exchange Commission
 filings made periodically by the company, copies of which are available from
 the company without charge or online at http://www.barra.com.  Please review
 such filings and do not place undue reliance on these forward-looking
 statements.  The company undertakes no obligation to release publicly the
 result of any revisions to these forward-looking statements that may be made
 to reflect events or circumstances after the date of this press release or to
 reflect the occurrence of unanticipated events.
 
     Barra Inc. and Subsidiaries
      Condensed Consolidated Statements of Income
      For the Three (Unaudited) and Twelve Month Periods Ended March 31, 2001
       and 2000
     (In thousands except for share and per share amounts)
 
                                   Three Months Ended      Fiscal Year Ended
                                        March 31,               March 31,
                                    2001         2000       2001         2000
     Operating Revenues:
        Portfolio and
         Enterprise Risk
         Management                $30,091     $24,903    $111,260     $92,362
        Symphony                     7,819       7,124      61,835      46,901
        POSIT                        5,708       5,339      21,070      19,064
        Other Ventures               7,598       7,165      30,253      28,222
          Total operating
           revenues                 51,216      44,531     224,418     186,549
 
     Operating Expenses:
        Communications, data
         and seminar                 1,979       1,705       7,900       7,953
        Compensation and
         benefits                   24,687      21,338      95,468      87,825
        Occupancy                    1,823       1,726       7,450       7,195
        Other operating
         expenses                    7,824       6,760      28,575      25,680
        Loss on sale of
         Estimates business                                  1,064
        Restructuring charges                    3,463                   9,024
 
          Total operating
           expenses                 36,313      34,992     140,457     137,677
 
     Interest Income & Other         1,780       2,885       4,383       3,980
 
     Income before Equity in
      Net Income and Loss of
      Investees, Minority
      Interest and Income Taxes     16,683      12,424      88,344      52,852
 
     Equity in Net Income and
      Loss of Investees                 88         (40)        159        (113)
 
     Minority Interest                (949)     (1,987)    (18,816)    (15,824)
 
     Income before Income Taxes     15,822      10,397      69,687      36,915
 
     Income Taxes                   (5,538)     (3,639)    (24,385)    (13,479)
 
     Net Income                    $10,284      $6,758     $45,302     $23,436
 
     Net Income Per Share:
        Basic                        $0.48       $0.33       $2.17       $1.12
        Diluted                      $0.45       $0.31       $2.01       $1.07
 
     Weighted Average Common
      and Common Equivalent
      Shares:
        Basic                   21,236,170  20,671,571  20,921,413  20,979,645
        Diluted                 22,855,000  21,907,083  22,510,364  21,952,379
 
     Net Income Excluding
      Unusual Items                $10,284      $7,916     $45,988     $28,097
 
     Net Income Per Share
      Excluding Unusual
      Items - Diluted                $0.45       $0.36       $2.04       $1.28
 
     Barra, Inc. and Subsidiaries
      Condensed Consolidated Balance Sheets
      As of March 31, 2001 and 2000 (Amounts in thousands except
        for share and per share amounts)
                                                    March 31,        March 31,
                                                      2001             2000
 
     ASSETS
     Current Assets:
     Cash and cash equivalents                      $61,837           $53,320
     Investments in marketable equity
      trading securities                             15,848            13,334
     Investments in marketable debt
      securities available-for-sale                  76,523            14,090
     Accounts receivable:
       Subscription and other (Less
        allowance for doubtful accounts of
        $518 and $755)                               11,916            18,411
       Asset Management                              11,175             8,984
       Related parties                                6,221             7,392
     Prepaid expenses                                 2,675             2,116
         Total current assets                       186,195           117,647
 
     Investments in Unconsolidated Companies          4,849             1,775
     Premises and Equipment:
     Computer and office equipment                   15,491            20,909
     Furniture and fixtures                           6,263             6,029
     Leasehold improvements                           8,764             8,747
     Total premises and equipment                    30,518            35,685
     Less accumulated depreciation and
      amortization                                  (16,052)          (18,366)
                                                     14,466            17,319
     Deferred Tax Assets                              9,316             4,355
     Computer Software
     (Less accumulated amortization of
      $2,082 and $1,455)                              1,615             1,994
     Other Assets                                     1,139               832
     Goodwill and other Intangibles
     (Less accumulated amortization of
      $7,174 and $7,304)                              9,995            24,840
     TOTAL                                         $227,575          $168,762
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
     Current Liabilities:
       Accounts payable                                $850              $975
       Accrued expenses payable:
         Accrued compensation                        17,018            14,084
         Accrued corporate income taxes              11,816            13,437
         Accrued restructuring charges                   --             2,654
         Other accrued expenses                       8,602             9,966
     Unearned revenues                               29,682            26,579
         Total current liabilities                   67,968            67,695
 
     Deferred Tax Liabilities                         3,631             1,994
 
     Minority Interest in Equity of Subsidiary        1,249             2,287
 
     Stockholders' Equity:
     Preferred stock, no par; 10,000,000
      shares authorized; none issued and
      outstanding
     Common stock, $.0001 par value;
      75,000,000 shares authorized;
      21,327,015 and 20,513,325
       shares issued and outstanding                      2                 1
     Additional paid-in capital                      29,340            16,208
     Retained earnings                              125,623            80,321
     Accumulated other comprehensive
      income (loss)                                    (238)              256
       Total stockholders' equity                   154,727            96,786
     TOTAL                                         $227,575          $168,762
 
     Barra, Inc.
     SEGMENT INFORMATION
     FOR THE THREE AND TWELVE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED)
 
                                   THREE MONTHS ENDED MARCH 31, 2000
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management           24,903                                 --    24,903
     Symphony Asset
      Management                             7,124             7,124     7,124
     POSIT                          5,339                      5,339     5,339
     Other Ventures                                   7,165    7,165     7,165
       Total revenues      24,903   5,339    7,124    7,165   19,628    44,531
 
     Compensation and
      Benefits            (14,218)   (331)  (1,889)  (4,900)  (7,120)  (21,338)
     Other Segment
      Expenses             (6,659)    (58)  (1,313)  (2,161)  (3,532)  (10,191)
     Interest Income and
      Other                   337              866    1,682    2,548     2,885
     Equity in Joint
      Ventures and
      Minority Interest                (8)  (1,987)     (32)  (2,027)   (2,027)
     Loss on Sale of
      Estimates Business   (3,463)                                      (3,463)
       Total Segment
        expenses          (24,003)   (397)  (4,323)  (5,411) (10,131)  (34,134)
     Segment Income
      (Loss)                  900   4,942    2,801    1,754    9,497    10,397
 
 
                                   TWELVE MONTHS ENDED MARCH 31, 2000
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management           92,362                                --     92,362
     Symphony Asset
      Management                            46,901            46,901    46,901
     POSIT                         19,064                     19,064    19,064
     Other Ventures                                  28,222   28,222    28,222
       Total revenues      92,362  19,064   46,901   28,222   94,187   186,549
     Compensation and
      Benefits            (55,995) (1,175) (10,471) (20,184) (31,830)  (87,825)
     Other Segment
      Expenses            (27,159)   (320)  (4,871)  (8,478) (13,669)  (40,828)
     Interest Income and
      Other                 1,434              864    1,682    2,546     3,980
     Equity in Joint
      Ventures and
      Minority Interest               109  (15,824)    (222) (15,937)  (15,937)
     Restructuring
      Charges and Loss on
      Sale                                                                  --
       of Estimates
        Business           (9,024)                                      (9,024)
       Total Segment
        expenses          (90,744) (1,386) (30,302) (27,202) (58,890) (149,634)
     Segment Income
      (Loss)                1,618  17,678   16,599    1,020   35,297    36,915
 
     Barra, Inc.
     SEGMENT INFORMATION
     FOR THE THREE AND TWELVE MONTHS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED)
 
                                   THREE MONTHS ENDED MARCH 31, 2001
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management           30,091                                       30,091
     Symphony Asset
      Management                             7,819             7,819     7,819
     POSIT                          5,708                      5,708     5,708
     Other Ventures                                   7,598    7,598     7,598
       Total revenues      30,091   5,708    7,819    7,598   21,125    51,216
     Compensation and
      Benefits            (14,265)   (445)  (4,098)  (5,879) (10,422)  (24,687)
     Other Segment
      Expenses             (7,726)   (250)  (1,912)  (1,738)  (3,900)  (11,626)
     Interest Income and
      Other                 1,277              503               503     1,780
     Equity in Joint
      Ventures and
      Minority Interest                       (949)      88     (861)     (861)
     Loss on Sale of
      Estimates Business                                          --        --
       Total Segment
        expenses          (20,714)   (695)  (6,456)  (7,529) (14,680)  (35,394)
 
     Segment Income
      (Loss)                9,377   5,013    1,363       69    6,445    15,822
 
                                   TWELVE MONTHS ENDED MARCH 31, 2001
 
                                            BARRA VENTURES
                                   POSIT
                                   Joint   Symphony           Total
                           CORE   Venture  Asset Mgt  Other  Ventures   Total
     Revenues:
     Portfolio and
      Enterprise Risk
      Management          111,260                                      111,260
     Symphony Asset
      Management                            61,835            61,835    61,835
     POSIT                         21,070                     21,070    21,070
     Other Ventures                                  30,253   30,253    30,253
       Total revenues     111,260  21,070   61,835   30,253  113,158   224,418
 
     Compensation and
      Benefits            (53,944) (1,462) (18,983) (21,079) (41,524)  (95,468)
     Other Segment
      Expenses            (28,569)   (740)  (5,696)  (8,920) (15,356)  (43,925)
     Interest Income and
      Other                 3,193            1,190             1,190     4,383
     Equity in Joint
      Ventures and
      Minority Interest               183  (18,816)     (24) (18,657)  (18,657)
     Restructuring
      Charges and Loss on
      Sale
       of Estimates
        Business                                     (1,064)  (1,064)   (1,064)
       Total Segment
        expenses          (79,320) (2,019) (42,305) (31,087) (75,411) (154,731)
 
     Segment Income
      (Loss)               31,940  19,051   19,530     (834)  37,747    69,687
 
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 SOURCE  Barra, Inc.