The Company, through its data centers located in North America, Europe and Australia, utilizes 12 mid-range and mainframe computers. All computers are owned or held under short-term leases. In total, these computers have 9,640 megabytes of memory and are capable of processing approximately 864.6 million instructions per second. The Company currently utilizes up to 90% of this capacity.
December 31, 1995 1994 (In Millions) Cash and equivalents, marketable securities and investments $ 44.6 $ 34.3 Current assets 203.5 167.7 Current liabilities 105.5 76.8 Working capital 98.0 90.9 Current portion of long-term debt 1.8 4.7 Long-term debt 14.9 4.2
Cash provided by operations increased as a result of several factors, including principally the Company's reporting net income for 1995 as opposed to a net loss for 1994, the increase in accounts payable from year-to-year and the Company's liquidation of a portion of its income tax receivable during 1995.
The consolidated financial statements are prepared on the basis of generally accepted accounting principles and include the accounts of the Company and its subsidiaries (the Company) all of which are wholly-owned. All material intercompany balances and transactions have been eliminated. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Certain amounts previously presented in the consolidated financial statements for prior periods have been reclassified to conform to current classifications.
In October 1995, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation" (SFAS 123), which the Company will adopt in 1996. This Statement requires that companies with stock-based compensation plans either recognize compensation expense based on new fair value accounting methods or continue to apply the provisions of Accounting Principles Board Opinion No. 25 and disclose pro forma net income and earnings per share assuming the fair value method had been applied. The Company is evaluating the new statement and will determine whether to adopt the recognition or disclosure alternative of the statement in the first quarter of 1996. Neither alternative is expected to have a material effect on the Company's results of operations or financial condition.
During the fourth quarter of 1994, the Company entered into an unsecured line of credit agreement with a bank for the purpose of supporting temporary working capital needs. The rate of interest to be charged on borrowings under this line of credit was the 90-day London Interbank Bid Offer Rate (LIBOR) plus one percent. As a result of the execution of the credit facilities described above, the Company discontinued this line of credit.
Shares under option exercisable at end of year 1,119,562 878,165 766,805
The Company announced on March 14, 1996, that it had agreed with GAP Coinvestment Partners and General Atlantic Partners 14 L.P. (collectively "General Atlantic Investors") to repurchase 759,512 of the 1,519,024 shares of the Company's common stock held by General Atlantic Investors and that the remainder of the Company's shares owned by General Atlantic Investors would be purchased by Continental Casualty Company, one of the nation's largest insurance companies and a licensee of the Company's Series III Solutions. The repurchase by the Company will be at $50.00 per share, which approximates an aggregate cash expenditure of $38.0 million. The shares to be repurchased by the Company represent 3.9% of its total shares outstanding prior to the repurchase. The Company expects to complete this transaction during the second quarter of 1996.