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EXHIBIT 99.1
PRESS RELEASE
CONTACT:
David M. Sugishita
Chief Financial Officer
Synopsys, Inc.
650-584-4257
SYNOPSYS PRO FORMA REVENUE UP 25%;
PRO FORMA EPS JUMPS 35%
RECORD THIRD QUARTER RESULTS POSTED
MOUNTAIN VIEW, CALIFORNIA. JULY 22, 1999 - Synopsys Inc., today reported its
third quarter results for the period ending July 3, 1999.
Revenue for the third quarter was $207.4 million, compared with pro forma
revenue for the same period last year of $165.7 million, an increase of 25%. Pro
forma net income, excluding unusual charges, was $47.6 million, or $0.65 per
share, compared with pro forma net income of $33.6 million, or $0.48 per share,
for the third quarter of fiscal 1998. This represents pro forma net income and
earnings per share growth of 42% and 35%, respectively. Earnings before
goodwill, which represents earnings per share on a fully diluted basis excluding
unusual charges and amortization of goodwill, amounted to $0.67 per share,
compared to $0.48 per share, for the third quarter of fiscal 1998, an increase
of 40%. The third quarter fiscal 1998 pro forma amounts exclude the PCB/Systems
business of Viewlogic Systems (divested on October 2, 1998) as well as unusual
charges.
Revenue for the third quarter was $207.4 million, compared with $179.6 million
for the same period last year without adjusting for the Viewlogic divestiture,
an increase of 15%. Actual net income for the third quarter was $41.4 million or
$0.56 per share, compared with net income of $33.8 million, or $0.48 per share
for the third quarter of fiscal 1998.
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Revenue for the first nine months of fiscal 1999 was $577.8 million, compared
with pro forma revenue for the same period last year of $481.7 million, an
increase of 20%. Pro forma net income, excluding unusual charges, was $132.4
million or $1.81 per share, compared with pro forma net income of $85.7 million,
or $1.24 per share for the same period last year. This represents pro forma net
income and earnings per share growth of 54% and 46%, respectively. Earnings
before goodwill amounted to $1.85 per share, compared to $1.24 per share, for
the same period last year. The nine months of fiscal 1998 pro forma amounts
exclude the PCB/Systems business of Viewlogic Systems as well as unusual
charges.
Revenue for the first nine months of fiscal 1999 was $577.8 million, compared
with $523.9 million for the same period last year without adjusting for the
Viewlogic divestiture, an increase of 10%. Actual net income for the first nine
months of fiscal 1999, including unusual charges, was $108.4 million or $1.48
per share, compared with $52.4 million or $0.76 per share for the same period
last year.
During the course of the third quarter, Synopsys acquired Stanza Systems, Inc.,
a privately held company with physical layout editor expertise and technology.
Stanza is located in the greater Silicon Valley area. The acquisition will
provide Synopsys with layout editing technology to be used in delivering further
comprehensive physical verification solutions to its customers. A portion of the
purchase price was allocated to in-process research and development and charged
to operations.
About Synopsys
Synopsys, Inc., (NASDAQ: SNPS) is a leading supplier of electronic design
automation (EDA) solutions to the global electronics market. The company
provides comprehensive design technologies to creators of advanced integrated
circuits, electronic systems, and systems on a chip. Synopsys also provides
consulting services and support to its customers to streamline the overall
design process and accelerate time to market. News and information are available
at http://www.synopsys.com.
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This release, other than historical information contained herein, may consist of
forward-looking statements that involve risks and uncertainties. The results
implied by these statements may differ materially from actual future events or
results. Factors which could cause results to differ from those projected herein
include: failure of the company to successfully integrate Stanza and to develop
products based on its technology, failure of the technology acquired by the
company to perform as anticipated, and potential challenges to the company's
charge for in-process research and development recorded in connection with its
acquisition of Stanza. Readers are referred to documents filed by Synopsys with
the Securities and Exchange Commission, specifically the most recent reports on
Forms 10-K and 10-Q, which identify important risk factors that could cause
actual results to differ from those contained in the forward-looking statements.
###
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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SYNOPSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (1)
(in thousands, except per share data)
(unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
--------------------- ---------------------
1999 1998 (2) 1999 1998 (2)
-------- -------- -------- --------
Revenue:
Product $131,945 $102,036 $358,584 $315,524
Service 75,415 77,570 219,188 208,399
-------- -------- -------- --------
Total revenue 207,360 179,606 577,772 523,923
-------- -------- -------- --------
Cost of revenue:
Product 10,897 8,898 26,803 25,991
Service 19,389 14,428 49,881 42,117
-------- -------- -------- --------
Total cost of revenue 30,286 23,326 76,684 68,108
-------- -------- -------- --------
Gross margin 177,074 156,280 501,088 455,815
-------- -------- -------- --------
Operating expenses:
Research and development 41,861 38,218 121,979 115,126
Sales and marketing 59,145 58,403 173,199 181,857
General and administrative 12,450 11,553 34,415 36,097
Amortization of goodwill 2,961 -- 4,431 --
Merger-related and other costs -- 3,121 -- 51,009
In-process research and development
and other costs 4,909 -- 21,176 4,191
-------- -------- -------- --------
Total operating expenses 121,326 111,295 355,200 388,280
-------- -------- -------- --------
Operating income 55,748 44,985 145,888 67,535
Other income, net 9,398 6,710 27,590 18,070
-------- -------- -------- --------
Income before provision for income taxes
and extraordinary item 65,146 51,695 173,478 85,605
Provision for income taxes 23,791 17,861 65,111 35,086
-------- -------- -------- --------
Net income before extraordinary item 41,355 33,834 108,367 50,519
Extraordinary item, net of income tax expense -- -- -- 1,869
-------- -------- -------- --------
Net income $ 41,355 $ 33,834 $108,367 $ 52,388
======== ======== ======== ========
Basic earnings per share:
Net income before extraordinary item $ 0.58 $ 0.50 $ 1.55 $ 0.76
Extraordinary item -- -- -- 0.03
-------- -------- -------- --------
Net income $ 0.58 $ 0.50 $ 1.55 $ 0.79
======== ======== ======== ========
Weighted average common shares 70,738 67,114 70,046 66,108
======== ======== ======== ========
Diluted earnings per share:
Net income before extraordinary item $ 0.56 $ 0.48 $ 1.48 $ 0.73
Extraordinary item -- -- -- 0.03
-------- -------- -------- --------
Net income $ 0.56 $ 0.48 $ 1.48 $ 0.76
======== ======== ======== ========
Weighted average common shares
and equivalents 73,694 70,349 73,183 69,173
======== ======== ======== ========
(1) The Company has a 52 week fiscal year for 1999 while fiscal year 1998 was
a 53 week year. For presentation purposes, all financial statements refer
to the quarter's calendar month end.
(2) Amounts and per share data for the periods presented have been
retroactively restated to reflect the merger with Everest Design
Automation, Inc.
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SYNOPSYS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (1)
(in thousands)
(unaudited)
JUNE 30, SEPTEMBER 30,
1999 1998 (2)
----------- ------------
ASSETS
Current assets:
Cash and short-term investments $ 645,180 $ 604,630
Accounts receivable, net 157,557 126,336
Prepaid expenses, deferred taxes and other 48,840 42,461
----------- -----------
Total current assets 851,577 773,427
Property and equipment, net 123,790 99,998
Long-term investments 53,469 38,265
Intangible assets, net 58,251 19,883
Other assets 25,313 20,060
----------- -----------
Total assets $ 1,112,400 $ 951,633
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 101,561 $ 117,412
Current portion of long-term debt 8,665 7,783
Accrued income taxes 40,470 50,313
Deferred revenue 89,689 93,160
----------- -----------
Total current liabilities 240,385 268,668
----------- -----------
Long-term debt 11,446 13,138
Deferred compensation 9,183 4,886
Stockholders' equity:
Capital stock 526,571 424,654
Retained earnings 344,176 240,465
Treasury stock, at cost (27,739) (11,184)
Accumulated other comprehensive income 8,378 11,006
----------- -----------
Total stockholders' equity 851,386 664,941
----------- -----------
Total liabilities and stockholders' equity $ 1,112,400 $ 951,633
=========== ===========
(1) The Company has a 52 week fiscal year for 1999 while fiscal year 1998 was
a 53 week year. For presentation purposes, all financial statements refer
to the quarter's calendar month end.
(2) Amounts for the period presented have been retroactively restated to
reflect the merger with Everest Design Automation, Inc.
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SYNOPSYS, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (1)
(in thousands, except per share data)
(unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
--------------------- ---------------------
1999 (2) 1998 (3) 1999 (2) 1998 (3)
-------- -------- -------- --------
Revenue:
Product $131,945 $ 96,137 $358,584 $298,425
Service 75,415 69,538 219,188 183,299
-------- -------- -------- --------
Total revenue 207,360 165,675 577,772 481,724
-------- -------- -------- --------
Cost of revenue:
Product 10,897 8,074 26,803 23,159
Service 19,389 13,271 49,881 38,117
-------- -------- -------- --------
Total cost of revenue 30,286 21,345 76,684 61,276
-------- -------- -------- --------
Gross margin 177,074 144,330 501,088 420,448
-------- -------- -------- --------
Operating expenses:
Research and development 41,861 35,620 121,979 106,910
Sales and marketing 59,145 53,491 173,199 167,970
General and administrative 12,450 10,591 34,415 33,026
Amortization of goodwill 2,961 -- 4,431 --
-------- -------- -------- --------
Total operating expenses 116,417 99,702 334,024 307,906
-------- -------- -------- --------
Operating income 60,657 44,628 167,064 112,542
Other income, net 9,398 6,710 27,590 18,050
-------- -------- -------- --------
Income before provision for income taxes 70,055 51,338 194,654 130,592
Provision for income taxes 22,418 17,739 62,289 44,880
-------- -------- -------- --------
Net income $ 47,637 $ 33,599 $132,365 $ 85,712
======== ======== ======== ========
Basic earnings per share:
Net income $ 0.67 $ 0.50 $ 1.89 $ 1.30
======== ======== ======== ========
Weighted average common shares 70,738 67,114 70,046 66,108
======== ======== ======== ========
Diluted earnings per share:
Net income $ 0.65 $ 0.48 $ 1.81 $ 1.24
======== ======== ======== ========
Weighted average common shares
and equivalents 73,694 70,349 73,183 69,173
======== ======== ======== ========
Earnings before goodwill (4) $ 0.67 $ 0.48 $ 1.85 $ 1.24
======== ======== ======== ========
(1) The Company has a 52 week fiscal year for 1999 while fiscal year 1998 was
a 53 week year. For presentation purposes, all financial statements refer
to the quarter's calendar month end.
(2) Amounts and per share data for the periods presented exclude in-process
research and development.
(3) Amounts and per share data for the periods presented have been
retroactively restated to reflect the merger with Everest Design
Automation, Inc. Amounts exclude the results of the PCB/Systems business
of Viewlogic Systems, Inc., merger-related costs, in-process research and
development and extraordinary items.
(4) Earnings before goodwill for the three and nine months ended July 3, 1999
were $49.7 million and $135.4 million. The tax effected goodwill for the
three and nine months ended July 3, 1999 were $2.0 million and $3.0
million.
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