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EXHIBIT 99.1
SYNOPSYS POSTS RECORD FINANCIAL RESULTS FOR FOURTH QUARTER AND FISCAL YEAR ENDED
1999
MOUNTAIN VIEW, California. October 26, 1999 - Synopsys, Inc., today reported its
fourth quarter and annual results for the period that ended on October 2, 1999.
Revenue for the fourth quarter was $228.3 million, compared with pro forma
revenue for the same period last year of $179.8 million, an increase of 27%. Net
income was $53.0 million, or $0.72 per share, compared with pro forma net income
of $37.2 million, or $0.53 per share, for the fourth quarter of fiscal 1998.
This represents pro forma net income and earnings per share growth of 42% and
36%, respectively. Earnings before goodwill (EBG), which represents earnings per
share on a fully diluted basis excluding amortization of intangible assets and
unusual charges, if any, amounted to $0.75 per share, compared to $0.53 per
share, for the fourth quarter of fiscal 1998, an increase of 42%. The fourth
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 fourth quarter was $228.3 million, compared with $194.0 million
for the same period last year without adjusting for the Viewlogic divestiture,
an increase of 18%. Net income for the fourth quarter was $53.0 million or $0.72
per share, compared with net income of $37.1 million, or $0.53 per share for the
fourth quarter of fiscal 1998.
Revenue for the fiscal year 1999 was $806.1 million, compared with pro forma
revenue for the same period last year of $661.6 million, an increase of 22%. Pro
forma net income, excluding unusual charges was $185.4 million or $2.52 per
share, compared with pro forma net income of $123.0 million, or $1.77 per share
for the same period last year. This represents pro forma net income and earnings
per share growth of 51% and 42%, respectively. EBG amounted to $2.60 per share,
compared to $1.77 per share, for the same period last year representing 47%
growth. The fiscal year 1998 pro forma amounts exclude the PCB/Systems business
of Viewlogic Systems as well as unusual charges.
Revenue for the fiscal year 1999 was $806.1 million, compared with $717.9
million for the same period last year without adjusting for the Viewlogic
divestiture, an increase of 12%. Net income for the fiscal year 1999 was $161.4
million or $2.20 per share, compared with $89.4 million or $1.29 per share for
the same period last year. This represents net income and earnings per share
growth of 80% and 71%, respectively.
"Synopsys delivered a very strong fourth quarter, capping off a superior year
for the company," commented Dr. Aart J. de Geus, chairman and CEO of Synopsys.
"Our business and product strategies are fully engaged and helping customers
solve their most complex challenges in IC design. Specifically, our Physical
Synthesis product strategy has been extremely well received by many global
semiconductor companies, and we are seeing an accelerating adoption of our
offerings," continued de Geus. "As we look forward, Synopsys is particularly
well positioned to help customers accelerate the pace of electronic product
innovation."
ABOUT SYNOPSYS
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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.
The sixth paragraph of this release contains forward-looking statements. These
statements are based on the company's current expectations and beliefs, as well
as certain assumptions regarding future events. Actual future results could
differ materially from the results implied by these statements. Factors that
could cause results to differ from those projected herein include: a lower than
anticipated level of investment in EDA tools by the company's customers; failure
to achieve the expected level of sales of the company's physical synthesis
products; increasing competition in the market for the company's products and
services; weakness in the semiconductor and or electronic systems industries;
and the acquisition of other companies or the failure to successfully integrate
them. For further discussion of these factors readers are referred to documents
filed by Synopsys with the Securities and Exchange Commission, specifically the
most recent reports on Forms 10-K, 10-Q, S-3, and 8-K, which identify important
risk factors that could cause actual results to differ from those contained in
the forward-looking statements.
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SYNOPSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME(1)
(in thousands, except per share data)
Three Months Ended Fiscal Year Ended
September 30, September 30,
1999 1998(2) 1999 1998(2)
-------- -------- -------- --------
(unaudited) (audited)
Revenue:
Product $147,263 $115,455 $505,847 $430,979
Service 81,063 78,562 300,251 286,961
-------- -------- -------- --------
Total revenue 228,326 194,017 806,098 717,940
-------- -------- -------- --------
Cost of revenue:
Product 11,085 10,380 37,888 36,371
Service 18,995 15,279 68,876 57,396
-------- -------- -------- --------
Total cost of revenue 30,080 25,659 106,764 93,767
-------- -------- -------- --------
Gross margin 198,246 168,358 699,334 624,173
-------- -------- -------- --------
Operating expenses:
Research and development 45,106 41,537 167,085 156,663
Sales and marketing 68,440 63,519 241,639 245,376
General and administrative 12,717 11,082 47,132 47,179
Amortization of intangible assets 3,476 -- 7,907 --
Merger-related and other costs -- -- -- 51,009
In-process research and development -- 28,878 21,176 33,069
-------- -------- -------- --------
Total operating expenses 129,739 145,016 484,939 533,296
-------- -------- -------- --------
Operating income 68,507 23,342 214,395 90,877
Other income, net 9,426 7,914 37,016 25,984
-------- -------- -------- --------
Income before provision for income
taxes and extraordinary items 77,933 31,256 251,411 116,861
Provision for income taxes 24,938 20,733 90,049 55,819
-------- -------- -------- --------
Net income before extraordinary items 52,995 10,523 161,362 61,042
Extraordinary items, net of income tax
expense -- 26,535 -- 28,404
-------- -------- -------- --------
Net income $ 52,995 $ 37,058 $161,362 $ 89,446
======== ======== ======== ========
Basic earnings per share:
Net income before extraordinary items $ 0.75 $ 0.15 $ 2.30 $ 0.92
Extraordinary items -- 0.39 -- 0.43
-------- -------- -------- --------
Net income $ 0.75 $ 0.54 $ 2.30 $ 1.34
======== ======== ======== ========
Weighted average common shares 70,324 68,037 70,118 66,568
======== ======== ======== ========
Diluted earnings per share:
Net income before extraordinary items $ 0.72 $ 0.15 $ 2.20 $ 0.88
Extraordinary items -- 0.38 -- 0.41
-------- -------- -------- --------
Net income $ 0.72 $ 0.53 $ 2.20 $ 1.29
======== ======== ======== ========
Weighted average common shares
and equivalents 74,030 70,296 73,422 69,524
======== ======== ======== ========
(1) The Company had 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)
(audited)
September 30, September 30,
1999 1998(2)
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ASSETS
Current assets:
Cash and cash equivalents $ 285,314 $164,548
Short-term investments 418,871 440,082
Accounts receivable, net 155,885 126,336
Prepaid expenses, deferred taxes and other 54,663 42,461
---------- --------
Total current assets 914,733 773,427
Property and equipment, net 126,204 99,998
Long-term investments 53,277 38,265
Intangible assets, net 57,393 20,230
Other assets 22,311 19,713
---------- --------
Total assets $1,173,918 $951,633
========== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 118,595 $117,412
Current portion of long-term debt 8,610 7,783
Accrued income taxes 50,036 50,313
Deferred revenue 110,285 93,160
---------- --------
Total current liabilities 287,526 268,668
---------- --------
Long-term debt 11,642 13,138
Deferred compensation 9,154 4,886
Stockholders' equity:
Capital stock 531,231 424,654
Retained earnings 371,395 240,465
Treasury stock, at cost (43,657) (11,184)
Accumulated other comprehensive income 6,627 11,006
---------- --------
Total stockholders' equity 865,596 664,941
---------- --------
Total liabilities and
stockholders' equity $1,173,918 $951,633
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(1) The Company had 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 Fiscal Year Ended
September 30, September 30,
1999(2) 1998(3) 1999(2) 1998(3)
-------- -------- -------- --------
Revenue:
Product $147,263 $109,555 $505,847 $407,980
Service 81,063 70,273 300,251 253,572
-------- -------- -------- --------
Total revenue 228,326 179,828 806,098 661,552
-------- -------- -------- --------
Cost of revenue:
Product 11,085 8,706 37,888 31,865
Service 18,995 14,113 68,876 52,230
-------- -------- -------- --------
Total cost of revenue 30,080 22,819 106,764 84,095
-------- -------- -------- --------
Gross margin 198,246 157,009 699,334 577,457
-------- -------- -------- --------
Operating expenses:
Research and development 45,106 38,840 167,085 145,750
Sales and marketing 68,440 59,077 241,639 227,047
General and administrative 12,717 10,138 47,132 43,164
Amortization of intangible assets 3,476 -- 7,907 --
-------- -------- -------- --------
Total operating expenses 129,739 108,055 463,763 415,961
-------- -------- -------- --------
Operating income 68,507 48,954 235,571 161,496
Other income, net 9,426 7,914 37,016 25,964
-------- -------- -------- --------
Income before provision for income
taxes 77,933 56,868 272,587 187,460
Provision for income taxes 24,938 19,623 87,227 64,503
-------- -------- -------- --------
Net income $ 52,995 $ 37,245 $185,360 $122,957
======== ======== ======== ========
Basic earnings per share:
Net income $ 0.75 $ 0.55 $ 2.64 $ 1.85
======== ======== ======== ========
Weighted average common shares 70,324 68,037 70,118 66,568
======== ======== ======== ========
Diluted earnings per share:
Net income $ 0.72 $ 0.53 $ 2.52 $ 1.77
======== ======== ======== ========
Weighted average common shares
and equivalents 74,030 70,296 73,422 69,524
======== ======== ======== ========
Earnings before amortization of
intangible assets (4) $ 0.75 $ 0.53 $ 2.60 $ 1.77
======== ======== ======== ========
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(1) The Company had 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 merger-related
and other costs and 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 and other costs, in-process research and development and
extraordinary items.
(4) Earnings before amortization of intangible assets for the quarter and year
ended September 30, 1999 were $55.4 million and $190.7 million. The tax
effected amortization of intangible assets for the quarter and year ended
September 30, 1999 were $2.4 million and $5.4 million.