View:
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): May 4, 2004
ANSYS. INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-20853 04-3219960
(State or Other Jurisdiction of (Commission File (I.R.S. Employer
Incorporation or Organization) Number) Identification No.)
275 Technology Drive, Canonsburg, PA 15317
(Address of Principal Executive Offices) (Zip Code)
(Registrant's Telephone Number, Including Area Code) (724) 746-3304
================================================================================
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c)
Exhibits
Exhibit
Number Description
------- -----------
99.1 Press Release of the Registrant dated May 4, 2004
Item 9. Regulation FD Disclosure
The Information contained in this Item 9 of this Current Report on Form
8-K is being furnished pursuant to "Item 12. Results of Operations and Financial
Condition" of Form 8-K.
The information in this Current Report is being furnished and shall not be
deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of
1934, as amended, or otherwise subject to the liabilities of such Section. The
information in this Current Report shall not be incorporated by reference into
any registration statement or other document pursuant to the Securities Act of
1933, except as shall be expressly set forth by specific reference in such
filing.
On May 4, 2004, ANSYS, Inc. issued an earnings release announcing its
financial results for the first quarter ended March 31, 2004. A copy of the
earnings release is attached as Exhibit 99.1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
ANSYS, INC.
(Registrant)
Date: May 4, 2004 By: /s/ MARIA T. SHIELDS
----------------------------------------
Maria T. Shields - Chief Financial
Officer, VP of Finance and
Administration (Ms. Shields is the
Principal Financial and Accounting
Officer and has been duly authorized to
sign on behalf of the Registrant)
Exhibit 99.1
ANSYS, Inc. Reports Record First Quarter Results
Company Raises Full Year Outlook
SOUTHPOINTE, Pa., May 4 /PRNewswire-FirstCall/ -- ANSYS, Inc.
(Nasdaq: ANSS), a global innovator of simulation software and technologies
designed to optimize product development processes, today announced first
quarter results. ANSYS' first quarter GAAP results include:
- Total revenue of $31.3 million, as compared to $24.6 million in the
first quarter of 2003;
- Net income of $7.1 million, as compared to $4.3 million in the first
quarter of 2003;
- Diluted earnings per share of $0.43 as compared to $0.27 in the first
quarter of 2003;
- Cash flows from operations of $13.2 million, as compared to
$11.5 million in the first quarter of 2003; and
- Cash and short-term investment balances of $96.3 million, and no debt.
Excluding the adverse impact on reported software license revenue of
purchase accounting adjustments related to the Company's February 2003
acquisition of CFX and acquisition-related amortization (see discussion
below), ANSYS' first quarter adjusted (non-GAAP) results include:
- Total adjusted revenue of $31.5 million, as compared to $25.1 million
in the first quarter of 2003;
- An overall adjusted operating profit margin, excluding total
amortization, of 35% as compared to 29% for the first quarter of 2003;
and
- Adjusted diluted earnings per share of $0.47 as compared to $0.32 for
the first quarter of 2003.
ANSYS President and CEO, Jim Cashman, commenting on the Company's first
quarter results, said, "We are pleased by our overall financial performance in
the first quarter and are especially encouraged that we were able to
accelerate the closure of sales. This sales success, combined with the
strength of our business model, directly contributed to first quarter results
exceeding our earlier estimates. Our continued ability to deliver solid
operating results illustrates that we are committed to our long-term mission
of being the global innovator of engineering simulation and technologies."
Cashman added, "While our first quarter performance enables us to become
more optimistic about our prospects for 2004, we remain committed to a long-
term focus and the importance of continued investment in our global sales and
marketing infrastructure, expansion of the depth and breadth of our product
and service offerings and the strengthening of the business infrastructure to
support our growth initiatives."
In summarizing the first quarter and the Company's expectations for the
balance of 2004, Mr. Cashman said, "We believe that our product offerings and
financial position have never been stronger. However, we still have a number
of challenges ahead of us. The second and third quarters have traditionally
been the most difficult and we do not envision that changing in the near
future. In light of this, we will continue to concentrate our energy on
providing solutions for total product innovation through simulation and
continuing to improve our sales productivity."
The adjusted results highlighted above, and the adjusted estimates for
2004 discussed below, represent non-GAAP (Generally Accepted Accounting
Principles) financial measures. A reconciliation of these measures to the
appropriate GAAP measures for the three months ended March 31, 2004 is
included in the condensed financial statements included in this release. A
discussion of the impact of these items on the Company's outlook for the
remainder of the year is included in the section below titled, "2004 Outlook."
Adjustments to Reported GAAP Financial Results
- Purchase Accounting Adjustment for Acquired Deferred Revenue:
As announced February 26, 2003, ANSYS acquired CFX for approximately
$22 million in cash. In accordance with the fair value provisions of
EITF 01-3 "Accounting in a Business Combination for Deferred Revenue of an
Acquiree," acquired deferred software license revenue of approximately
$4.8 million was recorded on the opening balance sheet, which was
approximately $3.4 million lower than the historical carrying value. Although
this purchase accounting requirement has no impact on the Company's business
or cash flow, it adversely impacted the Company's reported GAAP software
license revenue for the first twelve months post-acquisition. In order to
provide investors with financial information that facilitates comparison of
both historical and future results, the Company has provided adjusted
financial information, which excludes the impact of the purchase accounting
adjustment.
- Acquisition Related Amortization:
As previously discussed, the Company completed its acquisition of CFX in
February 2003. Prior to that, the Company also acquired CADOE S.A. and ICEM
CFD Engineering in November 2001 and August 2000, respectively. These
acquisitions have all been accounted for as purchases, resulting in the
recording of a significant amount of goodwill and identifiable intangible
assets.
ANSYS is providing, and has historically provided, its current quarter
GAAP results as well as financial results that have been adjusted for the
impact of the items described above. The Company believes that these non-GAAP
measures provide a consistent basis for comparison between quarters, as they
are not influenced by certain non-cash items and are therefore useful to
investors in helping them to better understand the Company's operating
results. In certain instances, amortization expense associated with acquired
intangibles also makes period-to-period comparisons difficult because
amortization expense may appear in one period but not in the comparable
period. Management uses these non-GAAP financial measures internally to
evaluate the Company's performance.
2004 Outlook
Based on the results of the first quarter and assumptions relating to
currently anticipated investments and expenditures for the remainder of the
year, the Company currently projects that full year 2004 GAAP diluted earnings
per share will be in the range of $1.61 - $1.65 and adjusted diluted earnings
per share will be in the range of $1.76 - $1.80. Management previously
forecasted adjusted diluted earnings per share in the range of $1.69 - $1.70
for 2004. The approximate $0.15 difference between the GAAP diluted earnings
per share estimate and the adjusted diluted earnings per share estimate
includes an estimated $0.14 related to acquisition-related amortization and
$0.01 related to the purchase accounting adjustment for acquired deferred
revenue.
ANSYS will hold a conference call at 10:30 A.M. Eastern Time on May 4,
2004 to discuss first quarter results as well as to provide guidance regarding
2004 business prospects. The dial in number is 800-857-7001 and the passcode
is "ANSYS". A replay will be available until May 11, 2004 by dialing
800-731-6045. The conference call will be webcast live as well as archived
and can be accessed, along with other financial information, on ANSYS'
website, located at www.ansys.com/newsrooms/investor.htm .
About ANSYS, Inc.
ANSYS, Inc., founded in 1970, develops and globally markets engineering
simulation software and technologies widely used by engineers and designers
across a broad spectrum of industries. ANSYS focuses on the development of
open and flexible solutions that enable users to analyze designs directly on
the desktop, providing a common platform for fast, efficient and cost-
conscious product development, from design concept to final-stage testing and
validation. Headquartered in Canonsburg, Pennsylvania U.S.A. with more than 25
strategic sales locations throughout the world, ANSYS, Inc. employs
approximately 550 people and distributes its products through a network of
channel partners in 40 countries. Visit www.ansys.com for more information.
Certain statements contained in the press release regarding matters that
are not historical facts, including statements regarding our current estimates
for full year 2004 earnings per share, are "forward-looking" statements (as
defined in the Private Securities Litigation Reform Act of 1995). Because such
statements are subject to risks and uncertainties, actual results may differ
materially from those expressed or implied by such forward-looking statements.
All forward-looking statements in this press release are subject to risks and
uncertainties. These include the risk of a general economic downturn in one
or more of ANSYS' primary geographic markets, the risk that the assumptions
underlying ANSYS' earnings per share estimates will change or prove
inaccurate, the risk that ANSYS has overestimated its ability to maintain
growth and profitability and control costs in the current economic
environment, uncertainties regarding the demand for ANSYS' products and
services in future periods, the risk that ANSYS has overestimated the strength
of the demand among its customers for its products in an unstable economy,
risks of problems arising from customer contract cancellations, uncertainties
regarding customer acceptance of new products, the risk that ANSYS' strategic
plan will not increase shareholder value over the long run, the risk that
ANSYS' operating results will be adversely affected by possible delays in
developing, completing, or shipping new or enhanced products, risks that
enhancements to the Company's products may not produce anticipated benefits,
the risk that changes in the price of our common stock or the existence of
competing uses for available cash will affect our willingness to continue the
stock repurchase program, uncertainties regarding fluctuations in quarterly
results, including uncertainties regarding the timing of orders from
significant customers and regional economies, and other factors that are
detailed from time to time in reports filed by ANSYS, Inc. with the Securities
and Exchange Commission, including ANSYS, Inc.'s 2003 Annual Report and Form
10-K and the most recent quarterly report on Form 10-Q.
ANSYS, Inc. is committed to providing the most open and flexible analysis
solutions to meet customer requirements for engineering software in today's
competitive marketplace. ANSYS, Inc. partners with leading design software
suppliers to develop state-of-the-art CAD-integrated products. ANSYS and its
global network of channel partners provide sales, support and training for
customers. Information about ANSYS, Inc. and its products can be found on the
Worldwide Web at www.ansys.com .
ANSYS, DesignSpace, ANSYS DesignModeler, ANSYS DesignXplorer VT, ANSYS
DesignXplorer, ANSYS ProFEA, ANSYS Emax, ANSYS Workbench environment, Multi-
field, CFX, AI*Environment, AI*NASTRAN, CADOE S.A. and any and all ANSYS, Inc.
product names referenced on any media, manual or the like, are registered
trademarks or trademarks of subsidiaries of ANSYS, Inc. located in the United
States or other countries. NASTRAN is a registered trademark of the National
Aeronautics Space Administration. All other product names mentioned are
trademarks or registered trademarks of their respective manufacturers.
Reconciliation of Non-GAAP Measures
This earnings release contains non-GAAP financial measures. For purposes
of Regulation G, a non-GAAP financial measure is a numerical measure of a
registrant's historical or future financial performance, financial position or
cash flows that excludes amounts, or is subject to adjustments that have the
effect of excluding amounts, that are included in the most directly comparable
measure calculated and presented in accordance with GAAP in the statement of
income, balance sheet or statement of cash flows of the issuer; or includes
amounts, or is subject to adjustments that have the effect of including
amounts, that are excluded from the most directly comparable measure so
calculated and presented. In this regard, GAAP refers to generally accepted
accounting principles in the United States. Pursuant to the requirements of
Regulation G, the Company has provided a reconciliation of the adjusted (non-
GAAP) financial measures to the most directly comparable GAAP financial
measures.
Adjusted software license revenue, adjusted operating profit margin,
adjusted net income and adjusted diluted earnings per share are presented in
this earnings release because management uses this information in evaluating
the results of the continuing operations of business and believes that this
information provides the users of the financial statements a valuable insight
into the operating results. Additionally, management believes that it is in
the best interest of its investors to provide financial information that will
facilitate comparison of both historical and future results.
ANSYS, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(in thousands, except per share data)
(Unaudited)
Three months ended
March 31, March 31,
2004 2003
Revenue:
Software licenses $16,324 $12,442
Maintenance and service 15,008 12,158
Total revenue 31,332 24,600
Cost of sales:
Software licenses 1,337 1,179
Amortization of software and
acquired technologies 755 525
Maintenance and service 3,083 2,894
Total cost of sales 5,175 4,598
Gross profit 26,157 20,002
Operating expenses:
Selling and marketing 6,054 5,512
Research and development 6,347 5,656
Amortization 287 223
General and administrative 3,499 2,644
Total operating expenses 16,187 14,035
Operating income 9,970 5,967
Other income, net 230 534
Income before income tax provision 10,200 6,501
Income tax provision 3,060 2,222
Net income $7,140 $4,279
Earnings per share - basic:
Basic earnings per share $0.47 $0.29
Weighted average shares - basic 15,315 14,627
Earnings per share - diluted:
Diluted earnings per share $0.43 $0.27
Weighted average shares
- diluted 16,461 15,584
ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Measures
For the three months ended March 31, 2004
(in thousands, except per share data)
(Unaudited)
Adjusted
As Reported Adjustments Results
Revenue:
Software licenses $16,324 $122(a) $16,446
Maintenance and service 15,008 - 15,008
Total revenue 31,332 122 31,454
Cost of sales:
Software licenses 1,337 - 1,337
Amortization of software
and acquired technologies 755 (617)(b) 138
Maintenance and service 3,083 - 3,083
Total cost of sales 5,175 (617) 4,558
Gross profit 26,157 739 26,896
Operating expenses:
Selling and marketing 6,054 - 6,054
Research and development 6,347 - 6,347
Amortization 287 (287)(b) -
General and administrative 3,499 - 3,499
Total operating expenses 16,187 (287) 15,900
Operating income 9,970 1,026 10,996
Other income, net 230 - 230
Income before income
tax provision 10,200 1,026 11,226
Income tax provision 3,060 359(c) 3,419
Net income $7,140 $667 $7,807
Earnings per share - basic:
Basic earnings per share $0.47 $0.51
Weighted average shares
- basic 15,315 15,315
Earnings per share - diluted:
Diluted earnings per share $0.43 $0.47
Weighted average shares
- diluted 16,461 16,461
(a) Amount represents the revenue not reported during the period as a
result of the purchase accounting adjustment associated with
EITF 01-3, "Accounting in a Business Combination for Deferred Revenue
of an Acquiree."
(b) Amount represents amortization expense associated with intangible
assets acquired in business acquisitions, including amounts primarily
related to acquired software, customer list and non-compete
agreements.
(c) Amount represents the income tax impact of the revenue and
amortization expense adjustments referred to in (a) and (b) above.
ANSYS, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Measures
For the three months ended March 31, 2003
(in thousands, except per share data)
(Unaudited)
Adjusted
As Reported Adjustments Results
Revenue:
Software licenses $12,442 $454(a) $12,896
Maintenance and service 12,158 - 12,158
Total revenue 24,600 454 25,054
Cost of sales:
Software licenses 1,179 - 1,179
Amortization of software and
acquired technologies 525 (398)(b) 127
Maintenance and service 2,894 - 2,894
Total cost of sales 4,598 (398) 4,200
Gross profit 20,002 852 20,854
Operating expenses:
Selling and marketing 5,512 - 5,512
Research and development 5,656 - 5,656
Amortization 223 (223)(b) -
General and administrative 2,644 - 2,644
Total operating expenses 14,035 (223) 13,812
Operating income 5,967 1,075 7,042
Other income, net 534 - 534
Income before income
tax provision 6,501 1,075 7,576
Income tax provision 2,222 376(c) 2,598
Net income $4,279 $699 $4,978
Earnings per share - basic:
Basic earnings per share $0.29 $0.34
Weighted average shares
- basic 14,627 14,627
Earnings per share - diluted:
Diluted earnings per share $0.27 $0.32
Weighted average shares
- diluted 15,584 15,584
(a) Amount represents the revenue not reported during the period as a
result of the purchase accounting adjustment associated with
EITF 01-03, "Accounting in a Business Combination for Deferred Revenue
of an Acquiree."
(b) Amount represents amortization expense associated with intangible
assets acquired in business acquisitions, including amounts primarily
related to acquired software, customer list and non-compete
agreements.
(c) Amount represents the income tax impact of the amortization expense
adjustment referred to in (a) above.
ANSYS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
March 31, December 31,
2004 2003
ASSETS:
Cash & short-term investments $96,283 $83,014
Accounts receivable, net 18,653 20,028
Other assets 78,520 76,304
Total assets $193,456 $179,346
LIABILITIES & STOCKHOLDERS' EQUITY:
Deferred revenue $43,787 $37,874
Other liabilities 12,589 14,398
Stockholders' equity 137,080 127,074
Total liabilities &
stockholders' equity $193,456 $179,346
SOURCE ANSYS, Inc.
-0- 05/04/2004
/CONTACT: Lisa M. O'Connor, Treasurer of ANSYS, Inc., +1-724-514-1782/
/Web site: http://www.ansys.com
http:/ www.ansys.com/newsrooms/investor.htm /
(ANSS)
CO: ANSYS, INC.
ST: Pennsylvania
IN: CPR STW
SU: ERN ERP CCA MAV