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CONFIDENTIAL DRAFT #10
05/18/00
10:45 AM
PRESS RELEASE
CONTACT:
Robert B. Henske Steve Shevick
Chief Financial Officer Vice President, Investor Relations
Synopsys, Inc. Synopsys, Inc.
650-584-4744 650-584-4880
SYNOPSYS POSTS FINANCIAL RESULTS FOR SECOND QUARTER 2000
MOUNTAIN VIEW, CALIFORNIA. MAY 18, 2000 - Synopsys Inc., today reported its
second quarter results for the period ending April 29, 2000.
Revenue for the second quarter was $204.9 million, compared with revenue for the
same period last year of $190.2 million, an increase of 8%. Second quarter
earnings before goodwill (EBG), which represents earnings per share on a fully
diluted basis excluding amortization of intangible assets and in-process
research and development, was $37.4 million, or $0.53 per share, for the second
quarter of fiscal 2000, compared with $45.3 million, or $0.61 per share, for the
second quarter of fiscal 1999. Net income for the second quarter of fiscal 2000,
including amortization of intangible assets and in-process research and
development, was $33.6 million, or $0.47 per share, compared with net income of
$26.6 million, or $0.36 per share, for the second quarter of fiscal 1999. This
represents net income and earnings per share growth of 26% and 31%,
respectively.
Revenue for the first six months of fiscal 2000 was $421.7 million, compared
with revenue for the same period last year of $370.4 million, an increase of
14%. EBG net income, excluding amortization of intangible assets and in-process
research and development, was $88. 1 million or $1.21 per share, compared with
EBG net income of $85.7 million, or $1.17 per share for the same period last
year. This represents EBG net income and earnings per share growth of 3%.
Net income for the first six months of fiscal 2000, after amortization of
intangible assets and in-process research and development, and including unusual
charges, was $78.7
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CONFIDENTIAL DRAFT #10
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million or $1.08 per share, compared with $67.0 million or $0.92 per share for
the same period last year. This represents net income and earnings per share
growth of 17%.
"Synopsys had a very solid second quarter," commented Aart de Geus,
Chairman and CEO of Synopsys. "We made significant progress on many fronts, most
notably in the deployment of our new Physical Synthesis products. Our customers
are seeing tremendous benefits from these products and we are encouraged by the
level of interest. During the second quarter we increased our capacity to deploy
these products and will continue to expand capacity during the third quarter."
About Synopsys
Synopsys, Inc. (Nasdaq: SNPS), headquartered in Mountain View, California,
creates leading electronic design automation (EDA) tools for the global
electronics market. The company delivers advanced design technologies and
solutions to developers of complex integrated circuits, electronic systems, and
systems on a chip. Synopsys also provides consulting and support services to
simplify the overall IC design process and accelerate time to market for its
customers. Visit Synopsys at http://www.synopsys.com.
Synopsys' quarterly conference call will be held at 3 p.m. today. A replay of
the call will be available through streetfusion.com.
This release may contain forward-looking statements under the safe harbor
provisions of Section 21E of the Securities Exchange Act of 1934. These
statements are based on Synopsys' current expectations and beliefs. Actual
results could differ materially from the results implied by these statements.
Factors that could cause results to differ from these statements include the
competitive nature of the electronic design automation industry; price
competition; unpredictability of customer reaction to new products; the
possibility that new products will reduce demand for existing products; as well
as factors identified in documents filed by Synopsys with the Securities and
Exchange Commission, specifically the most recent reports on Forms 10-K and
10-Q.
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###
Synopsys is a registered trademark of Synopsys, Inc. All other trademarks
mentioned in this release are the intellectual property of their respective
owners.
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CONFIDENTIAL DRAFT #10
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SYNOPSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (1)
(in thousands, except per share data)
(unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
----------------------- ----------------------
APRIL 30, MARCH 31, APRIL 30, MARCH 31,
2000 1999 2000 1999
--------- --------- --------- ---------
Revenue:
Product $ 123,033 $ 116,680 $ 253,582 $ 226,639
Service 81,820 73,506 168,139 143,773
--------- --------- --------- ---------
Total revenue 204,853 190,186 421,721 370,412
--------- --------- --------- ---------
Cost of revenue:
Product 10,653 8,311 20,939 15,906
Service 19,273 16,381 37,872 30,492
--------- --------- --------- ---------
Total cost of revenue 29,926 24,692 58,811 46,398
--------- --------- --------- ---------
Gross margin 174,927 165,494 362,910 324,014
--------- --------- --------- ---------
Operating expenses:
Research and development 45,962 39,182 90,229 80,118
Sales and marketing 70,395 58,476 137,391 114,054
General and administrative 14,033 10,873 26,282 21,965
Amortization of intangible assets 3,690 1,470 7,211 1,470
In-process research and development
and other costs - 16,267 1,750 16,267
--------- --------- --------- ---------
Total operating expenses 134,080 126,268 262,863 233,874
--------- --------- --------- ---------
Operating income 40,847 39,226 100,047 90,140
Other income, net 9,694 9,708 18,634 18,192
--------- --------- --------- ---------
Income before provision for income taxes 50,541 48,934 118,681 108,332
Provision for income taxes 16,967 22,313 40,004 41,320
--------- --------- --------- ---------
Net income $ 33,574 $ 26,621 $ 78,677 $ 67,012
========= ========= ========= =========
Basic earnings per share:
Net income $ 0.49 $ 0.38 $ 1.12 $ 0.96
========= ========= ========= =========
Weighted average common shares 69,153 70,286 70,054 69,739
========= ========= ========= =========
Diluted earnings per share:
Net income $ 0.47 $ 0.36 $ 1.08 $ 0.92
========= ========= ========= =========
Weighted average common shares
and equivalents 71,089 73,873 72,964 73,207
========= ========= ========= =========
(1) On July 15, 1999, the Board of Directors changed the Company fiscal year to
end on the Saturday nearest to October 31. Information for the October 1999
transition period was filed with Synopsys' quarterly report on Form 10-Q
for the first quarter of fiscal 2000.
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CONDENSED CONSOLIDATED BALANCE SHEETS (1)
(in thousands)
(unaudited)
APRIL 30, OCTOBER 31,
2000 1999
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $ 150,611 $ 309,394
Short-term investments 466,101 399,995
Accounts receivable, net 160,365 130,253
Prepaid expenses, deferred taxes and other 61,282 66,814
----------- -----------
Total current assets 838,359 906,456
----------- -----------
Property and equipment, net 141,302 135,118
Long-term investments 83,037 57,651
Intangible assets, net 53,451 56,240
Other assets 31,957 22,818
----------- -----------
Total assets $ 1,148,106 $ 1,178,283
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 88,098 $ 98,976
Current portion of long-term debt 12,303 8,658
Accrued income taxes 63,321 50,146
Deferred revenue 140,010 126,758
----------- -----------
Total current liabilities 303,732 284,538
----------- -----------
Long-term debt 1,497 11,304
Deferred compensation 15,017 9,844
Stockholders' equity:
Capital stock 556,718 542,760
Retained earnings 398,480 349,192
Treasury stock, at cost (147,315) (28,589)
Accumulated other comprehensive income 19,977 9,234
----------- -----------
Total stockholders' equity 827,860 872,597
----------- -----------
Total liabilities and stockholders' equity $ 1,148,106 $ 1,178,283
=========== ===========
(1) On July 15, 1999, the Board of Directors changed the Company fiscal year to
end on the Saturday nearest to October 31. Information for the October 1999
transition period was filed with Synopsys' quarterly report on Form 10-Q
for the first quarter of fiscal 2000.
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SYNOPSYS, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (1)(2)
(in thousands, except per share data)
(unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
----------------------- ----------------------
APRIL 30, MARCH 31, APRIL 30, MARCH 31,
2000 1999 2000 1999
--------- --------- --------- ---------
Revenue:
Product $ 123,033 $ 116,680 $ 253,582 $ 226,639
Service 81,820 73,506 168,139 143,773
--------- --------- --------- ---------
Total revenue 204,853 190,186 421,721 370,412
--------- --------- --------- ---------
Cost of revenue:
Product 10,653 8,311 20,939 15,906
Service 19,273 16,381 37,872 30,492
--------- --------- --------- ---------
Total cost of revenue 29,926 24,692 58,811 46,398
--------- --------- --------- ---------
Gross margin 174,927 165,494 362,910 324,014
--------- --------- --------- ---------
Operating expenses:
Research and development 45,962 39,182 90,229 80,118
Sales and marketing 70,395 58,476 137,391 114,054
General and administrative 14,033 10,873 26,282 21,965
--------- --------- --------- ---------
Total operating expenses 130,390 108,531 253,902 216,137
--------- --------- --------- ---------
Operating income 44,537 56,963 109,008 107,877
Other income, net 9,694 9,708 18,634 18,192
--------- --------- --------- ---------
Income before provision for income taxes 54,231 66,671 127,642 126,069
Provision for income taxes 16,812 21,334 39,569 40,341
--------- --------- --------- ---------
Net income $ 37,419 $ 45,337 $ 88,073 $ 85,728
========= ========= ========= =========
Basic earnings per share:
Net income $ 0.54 $ 0.65 $ 1.26 $ 1.23
========= ========= ========= =========
Weighted average common shares 69,153 70,286 70,054 69,739
========= ========= ========= =========
Diluted earnings per share:
Net income $ 0. 53 $ 0.61 $ 1.21 $ 1.17
========= ========= ========= =========
Weighted average common shares
and equivalents 71,089 73,873 72,964 73,207
========= ========= ========= =========
(1) On July 15, 1999, the Board of Directors changed the Company fiscal year to
end on the Saturday nearest to October 31. Information for the October 1999
transition period was filed with Synopsys' quarterly report on Form 10-Q
for the first quarter of fiscal 2000.
(2) Amounts and per share data for the periods presented exclude amortization
of intangible assets and in-process research and development.
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