Ansoft (ANST) 8-K Ansoft Corporation Second Quarter Results – 30% Increase In Revenue

ANSOFT CORPORATION SECOND QUARTER RESULTS –
30% INCREASE IN REVENUE

PITTSBURGH, PA – Nov. 18, 2004 – Ansoft Corporation (NASDAQ: ANST) today announced financial results for its second quarter of fiscal 2005 ended October 31, 2004.

Revenue for the second quarter totaled $15.9 million, an increase of 30% compared to $12.3 million reported in the previous fiscal year’s second quarter. Net income for the second quarter was $1.9 million or $0.14 per diluted share, as compared to a net loss of $(22,000), or $0.00 per diluted share in the previous fiscal year’s second quarter.

“We are pleased with the continued revenue growth in both product lines and in our domestic and international markets this quarter,” said Nicholas Csendes, Ansoft’s President and CEO. “For the fiscal year, we anticipate revenue growth to exceed 20% with increasing profitability.”

Ansoft is a leading developer of high-performance electronic design automation (EDA) software. Engineers use Ansoft software to design state-of-the-art electronic products, such as cellular phones, Internet-access devices, broadband networking components and systems, integrated circuits (ICs), printed circuit boards (PCBs), automotive electronic systems and power electronics. Ansoft markets its products worldwide through its own direct sales force and has comprehensive customer-support and training offices throughout North America, Asia and Europe.

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. These forward-looking statements involve risks and uncertainties about the Company’s business that are detailed from time to time in the Company’s SEC reports, including the reports on Form 10-K for the year ended April 30, 2004.

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ANSOFT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(unaudited)

	Three months ended October 31,						Six months ended October 31,
		2004			2003			2004		2003
Revenue
License	$	8,661		$	6,893		$	14,830	$	12,234
Service and other		7,285			5,365			13,794		10,675
Total revenue		15,946			12,258			28,624		22,909
Costs of revenue
License		125			164			222		306
Service and other		356			272			660		520
Total cost of revenue		481			436			882		826
Gross profit		15,465			11,822			27,742		22,083
Operating Expenses
Sales and marketing		7,601			6,339			15,098		12,659
Research and development		4,048			3,773			8,026		7,596
General and administrative		1,329			1,186			2,393		2,297
Amortization		384			761			793		1,618
Total operating expenses		13,362			12,059			26,310		24,170
Income (loss) from operations		2,103			(237	)		1,432		(2,087	)
Net realized gain (loss) on sale of securities		(27	)					732
Other income, net		647			207			601		468
Income (loss) before income taxes		2,723			(30	)		2,765		(1,619	)
Income tax expense (benefit)		834			(8	)		844		(405	)
Net income (loss)	$	1,889		$	(22	)	$	1,921	$	(1,214	)
Net income (loss) per share
Basic	$	0.16		$	(0.00	)	$	0.17	$	(0.10	)
Diluted	$	0.14		$	(0.00	)	$	0.14	$	(0.10	)
Weighted average shares used in calculation
Basic		11,567			11,637			11,616		11,655
Diluted		13,238			11,637			13,275		11,655

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ANSOFT CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)

	October 31,			April 30,
		2004			2004
	(unaudited)
Assets
Current assets
Cash and cash equivalents	$	8,947		$	15,218
Accounts receivable, net		8,602			10,179
Deferred income taxes		576			343
Prepaid expenses and other assets		1,452			675
Total current assets		19,577			26,415
Equipment and furniture		3,402			3,598
Marketable securities		24,871			25,502
Other assets		381			383
Deferred income taxes		4,973			5,158
Goodwill		1,239			1,239
Intangible assets		4,548			5,341
Total assets	$	58,991		$	67,636
Liabilities and stockholders’ equity
Current liabilities
Accounts payable and accrued expenses	$	3,818		$	4,015
Deferred revenue		12,802			11,935
Total current liabilities		16,620			15,950
Line of credit		5,000			10,000
Total liabilities		21,620			25,950
Stockholders’ equity
Preferred stock		—			—
Common stock		131			129
Additional paid-in capital		60,462			58,562
Treasury stock		(16,856	)		(9,090	)
Accumulated other comprehensive income		319			691
Accumulated deficit		(6,685	)		(8,606	)
Total stockholders’ equity		37,371			41,686
Total liabilities and stockholders’ equity	$	58,991		$	67,636

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