PTC Reports Fiscal 2004 Third Quarter Results
-- Company Drives Significant Growth in Net Income and Cash Position --
NEEDHAM, Mass., July 21 /PRNewswire-FirstCall/ -- PTC (NASDAQ:PMTC), the
product development company(TM), today reported revenue totaling $168.4 million
for the third quarter ended July 3, 2004, up 2% from $165.2 million for the
same period last year. Revenue also grew 2% sequentially, from $164.7 million
in the second quarter of fiscal 2004.
Net income for the third quarter was $16.1 million, or $0.06 per diluted share,
compared with a net loss of $33.8 million, or a loss of $0.13 per share, in the
year-ago period. On a sequential basis, net income improved from $3.2 million,
or $0.01 per diluted share, in the second quarter of 2004. The third quarter
net income includes restructuring charges of $3.5 million, compared with
restructuring and other charges of $15.1 million in the year-ago period, and
restructuring and other charges of $16.7 million in the second quarter of 2004. Cash and investments grew 16% sequentially to $257.7 million at the end of the
third quarter, from $221.7 million at the end of the second quarter.
"Solid execution has resulted in significant earnings improvement and a return
to year-over-year revenue growth," said C. Richard Harrison, president and
chief executive officer. "The work we've done to bring exciting new products
to market, combined with significant restructuring of our distribution and
services delivery models, has enabled us to improve our third quarter net
income by nearly $50 million year-over-year. We are proud of this performance
and of the dedication of PTC employees who helped achieve these results." Total design solutions revenue for the third quarter was $121.6 million,
compared to $123.0 million in the second quarter. Design solutions license
revenue was $35.9 million, down from $38.0 million in the second quarter due to
fewer large transactions. Design solutions maintenance revenue continued to
grow, a positive indicator of the success of Pro/ENGINEER Wildfire in the
existing customer base.
Total Windchill revenue in the third quarter grew 12% sequentially to $46.8
million, from $41.7 million in the second quarter. Windchill license revenue
was $16.5 million, up 27% from $12.9 million in the prior quarter. Windchill
Link solutions license revenue represented 44% of overall Windchill license
revenue. Improved revenue performance from consulting services and maintenance
contracts also contributed to the total Windchill growth during the quarter.
In the third quarter, PTC received orders from leading manufacturing
organizations such as Air France Industries, Boeing Company, Chrysler
Corporation, DBT GmbH, Eni S.p.A., Fraunhofer Gesellschaft, Hino Motors,
Komatsu, LG Electronics, Otis Elevator Company, Tenneco Automotive, Toyota
Motor Corporation and the United States Army. Additionally, orders from our
reseller channel resulted in $13.4 million in license revenue during the
quarter, a 6% sequential decline, but a 39% year-over-year increase.
"We have shown steady improvements in our financial and operating results and
have performed well in each quarter of Fiscal 2004 to date," continued
Harrison. "We are on track to achieve our longer-term goal of operating
margins in excess of 20%. I am confident in our ability to grow our revenue to
reach this goal by leveraging our industry-leading solutions in the growing PLM
market, and by focusing on strategic corporate development opportunities." Fourth Quarter 2004 Financial Outlook PTC's revenue forecast for the fourth quarter of fiscal 2004 is between $165
million and $172 million. Total operating expense is expected to be
approximately $145 million. The Company expects earnings per share on a GAAP
basis to be between $0.05 and $0.08.
The Company will provide detailed financial information and an outlook update
on its third quarter results conference call and live webcast on July 21, 2004
at 10 a.m. ET. This earnings press release and accompanying financial and
operating statistics will be accessible prior to the conference call and
webcast on the Company's web site at http://www.ptc.com/for/investors.htm. In
addition, the live webcast may be accessed at the same Web address. To access
the live call, please dial 888-970-4169 (in the U.S.) or +1-312-470-7002
(international). Please use passcode PTC. A replay of the call will be
available until 5:00 p.m. ET on July 26, 2004. To access the replay via
webcast, please visit http://www.ptc.com/for/investors.htm. To access the
replay by phone, please dial 203-369-1778.
The Company's unaudited consolidated statements of operations, the unaudited
condensed consolidated balance sheets, and the unaudited condensed consolidated
statements of cash flows for the third quarter are attached.
About PTC PTC (NASDAQ:PMTC) develops, markets, and supports software solutions that help
manufacturers win with superior products. With a total commitment to product
development and product lifecycle management (PLM), the Company services more
than 35,000 customers worldwide. PTC is included in the S&P 500 and Russell
2000 indices. Further information on PTC is available at http://www.ptc.com/.
Except for the historical information contained herein, matters discussed in
this news release may constitute forward-looking statements that involve risks
and uncertainties that could cause actual results to differ materially from
those projected. These include: the growth of the PLM market and our ability
to facilitate our customers' understanding of the benefits of our PLM solutions
and differentiated product development system offering, including return on
investment, ease of use, and value creation in order to create the foundation
for future revenue growth; the success of our efforts to leverage our
distribution model (including effectively coordinating our indirect channel
sales activities), our customer relationships, our new reduced cost structure,
and strategic corporate development opportunities to achieve our longer term
revenue growth and operating margin goals; our ability to achieve financial and
operating goals (including our fourth quarter revenue and earnings targets)
with our significantly reduced cost structure; and continued improvement in
the IT spending environment which until recently has been weak and has impacted
the overall demand for software and related services; as well as other risks
and uncertainties detailed from time to time in reports filed by PTC with the
Securities and Exchange Commission, including the Company's most recent reports
on Form 10-K and 10-Q.
PTC, The Product Development Company, Pro/ENGINEER, Wildfire, Windchill, and
all PTC product names and logos are trademarks or registered trademarks of
Parametric Technology Corporation or its subsidiaries in the United States and
in other countries. All other companies and products referenced herein have
trademarks or registered trademarks of their respective holders.
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
Three Months Ended Nine Months Ended
July 3, June 28, July 3, June 28,
2004 2003 2004 2003 Revenue:
License $52,405 $48,621 $146,893 $155,382
Service 115,972 116,623 343,002 352,855
Total revenue 168,377 165,244 489,895 508,237 Costs and expenses:
Cost of license revenue 2,260 2,875 6,301 7,498
Cost of service revenue 43,764 52,420 132,440 151,744
Sales and marketing 55,237 72,329 170,554 231,401
Research and
development 26,250 31,880 82,609 95,722
General and
administrative 13,369 17,931 42,693 50,108
Amortization of other
intangible assets 1,227 1,459 3,972 4,400
Restructuring and
other charges 3,548 15,134 41,848 15,134
Total costs and
expenses 145,655 194,028 480,417 556,007 Operating income (loss) 22,722 (28,784) 9,478 (47,770)
Other income (expense),
net (300) (10) (613) (1,462)
Income (loss) before
income taxes 22,422 (28,794) 8,865 (49,232)
Provision for income
taxes 6,287 4,968 16,096 11,089
Net income (loss) $16,135 $(33,762) $(7,231) $(60,321) Net income (loss) per share:
Basic $0.06 $(0.13) $(0.03) $(0.23)
Weighted average
shares outstanding 268,104 264,487 267,292 263,625 Diluted $0.06 $(0.13) $(0.03) $(0.23)
Weighted average
shares outstanding 274,983 264,487 267,292 263,625
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
July 3, September 30,
2004 2003 ASSETS Cash and investments $257,741 $205,312
Accounts receivable, net 144,126 140,151
Property and equipment, net 57,354 73,563
Goodwill and other intangibles, net 58,536 51,851
Other assets 95,399 106,813 Total assets $613,156 $577,690 LIABILITIES AND STOCKHOLDERS' EQUITY Deferred revenue $202,165 $173,015
Total liabilities 216,072 209,517
Stockholders' equity 194,919 195,158 Total liabilities and stockholders' equity $613,156 $577,690
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
Three Months Ended Nine Months Ended
July 3, June 28, July 3, June 28,
2004 2003 2004 2003 Cash flows from operating activities:
Net income (loss) $16,135 $(33,762) $(7,231) $(60,321)
Depreciation and
amortization 8,776 9,931 27,518 31,166
Other 21,633 30,766 41,429 39,184
Net cash provided
by operating
activities 46,544 6,935 61,716 10,029 Capital expenditures (1,917) (6,815) (7,609) (20,100)
Acquisition of
a business (9,822) - (9,822) - Other investing
and financing activities 446 (242) 5,217 3,631
Foreign exchange
impact on cash 825 2,847 2,927 4,288 Net change in cash
and investments 36,076 2,725 52,429 (2,152)
Cash and investments,
beginning of period 221,665 205,537 205,312 210,414
Cash and investments,
end of period $257,741 $208,262 $257,741 $208,262
Investor Relations Contact: Public Relations Contact:
Meredith Mendola Maria Battaglia
781-370-6151 781-370-5245
DATASOURCE: PTC CONTACT: Investor Relations Contact: Meredith Mendola, +1-781-370-6151, , or Public Relations Contact: Maria Battaglia, +1-781-370-5245, , both of PTC Web site: http://www.ptc.com/
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