EXHIBIT 99
INVESTOR RELATIONS CONTACT: MEDIA RELATIONS CONTACT:
Neil Yekell Arch Currid
(713) 918-4233 (713) 918-3236
neil_yekell@bmc.com arch_currid@bmc.com
BMC SOFTWARE REPORTS INCREASES IN FOURTH QUARTER EARNINGS AND REVENUES
HOUSTON -- (April 24, 2003) -- BMC Software, Inc. [NYSE: BMC] today
announced financial results for its fiscal fourth quarter, ended March 31, 2003.
BMC Software's net earnings excluding special items for the fourth
quarter of fiscal 2003 were $38.9 million, or $0.17 per diluted common share, an
increase of $0.05 compared to the fourth quarter of fiscal 2002 and $0.01 over
the current analyst consensus of $0.16. Fourth quarter fiscal 2003 net earnings
on a GAAP basis were $20.6 million or $0.09 per diluted common share, which
compares to a net loss of $1.8 million or $0.01 per diluted common share in the
fourth quarter of fiscal 2002. Included in the financial tables is a
reconciliation of results excluding special items and GAAP results.
"We met our fourth quarter revenue and earnings goals and generated
$606 million in operating cash flow for the year, despite the economic
uncertainty that continued to affect IT purchases during the quarter. We
achieved these results by staying focused on our customers and by competing
strongly in the marketplace," said Bob Beauchamp, president and CEO, BMC
Software. "As we begin our new fiscal year, BMC will maintain this focus while
advancing our recently announced Business Service Management strategy to enable
customers to move beyond traditional IT management and allow them to manage
their business from both an IT and a business perspective."
Total revenues in the fourth fiscal quarter were $380.7 million, an
increase of 15 percent compared to the same quarter of fiscal 2002. Total
license revenues in the quarter increased to $180.8 million, up 12 percent,
compared to the same quarter of fiscal 2002. Maintenance revenues increased to
$176.1 million, up 18 percent, compared to the same quarter of fiscal 2002.
Professional services revenues were $23.8 million, an increase of 10 percent
compared to the same quarter last year. Operating expenses, excluding $24.1
million of special items, were $336.5 million, compared to $302.0 million in the
same quarter of fiscal 2002. These results reflect Remedy's operations in the
fourth quarter of fiscal 2003. Total revenues for Remedy in the fourth quarter
were $49.2 million and expenses were $42.7 million, excluding $12.0 million of
amortization of intangibles.
The deferred license revenue balance at March 31, 2003 was $218.1
million, an increase of $49.2 million compared to a year ago and a decrease of
$6.7 million sequentially. Cash flow from operations in fiscal 2003 was $606
million. Cash and marketable securities at March 31, 2003 were $1.02 billion.
BMC continues to have no debt.
BMC has continued its Board-authorized stock repurchase program that
began in April 2000 by spending $51 million to repurchase 2.9 million shares
during the fourth fiscal quarter. Approximately $479 million remains in this
program.
BMC SOFTWARE REPORTS INCREASES IN FOURTH QUARTER EARNINGS AND REVENUES/PAGE 2
FOURTH QUARTER FISCAL 2003 FINANCIAL HIGHLIGHTS
o Cash flow from operations of $226 million in fiscal Q4.
o Strong sequential performance in key systems management product lines:
o PATROL(R) license revenues grew 15 percent sequentially.
o MAINVIEW(R) license revenues grew 23 percent sequentially.
o Remedy fourth quarter revenues of $49.2 million exceeded target of $44
million to $47 million.
o Cash and marketable securities balance at year-end was $1.02 billion.
o Record total deferred revenues balance at year-end of $1.17 billion.
BMC Software will host its annual Investor Day event on May 8, 2003 at
BMC Software Headquarters in Houston, Texas. Please visit the Investor Day 2003
event website to register: http://investor.bmcevents.com/. A live audio webcast
of Investor Day remarks and presentations will be available via the company's
website at www.bmc.com/investors for all interested parties. A replay of the
webcast will be available within 24 hours and archived on the website for 30
days.
A CONFERENCE CALL TO DISCUSS FOURTH QUARTER RESULTS AND TO PROVIDE
FISCAL 2004 GUIDANCE IS SCHEDULED FOR TODAY AT 11:00 A.M. CDT. THOSE INTERESTED
IN PARTICIPATING MAY CALL (913) 981-5509 AND USE THE PASSCODE BMC. TO ACCESS A
REPLAY OF THE CONFERENCE CALL, WHICH WILL BE AVAILABLE FOR ONE WEEK, DIAL (719)
457-0820 AND USE THE PASSCODE BMC. A LIVE WEBCAST OF THE CONFERENCE CALL AND
PRESENTATION WILL BE AVAILABLE ON THE COMPANY'S WEBSITE AT
www.bmc.com/investors. A REPLAY OF THE WEBCAST WILL BE AVAILABLE WITHIN 24 HOURS
AND ARCHIVED ON THE WEBSITE FOR 90 DAYS.
NON-GAAP FINANCIAL MEASURES
This press release includes financial measures for net earnings,
earnings per share (EPS) and operating expenses that exclude certain charges and
therefore have not been calculated in accordance with U.S. generally accepted
accounting principles (GAAP). A detailed reconciliation between the GAAP results
and non-GAAP results is included with the financial tables accompanying this
press release. BMC Software has provided these non-GAAP measures in its press
releases reporting historical financial results because the company believes
these measures provide a consistent basis for comparison between quarters, which
are not influenced by certain non-cash or non-recurring expenses and are
therefore useful to investors in helping them understand the financial condition
of BMC Software by focusing on the performance of its core operations.
Management uses these non-GAAP financial measures internally to evaluate the
performance of its various businesses and as a key variable in determining
management compensation. These non-GAAP measures should not be considered an
alternative to GAAP, and these non-GAAP measures may not be comparable to
information provided by other companies.
ABOUT BMC SOFTWARE
BMC Software, Inc. [NYSE:BMC] is a leader in enterprise management. The
company focuses on Assuring Business Availability(R) for its customers by
helping them proactively improve service, reduce costs and increase value to
their business. BMC Software solutions span enterprise systems, applications,
databases and service management. Through its Business Service Management
strategy, the company's solutions enable customers to
BMC SOFTWARE REPORTS INCREASES IN FOURTH QUARTER EARNINGS AND REVENUES/PAGE 3
have a complete view of their business and IT operations by linking IT resources
to business objectives. Founded in 1980, BMC Software has offices worldwide and
is a member of the S&P 500, with fiscal year 2003 revenues of approximately $1.3
billion.
This news release contains both historical information and
forward-looking information. Statements of plans, objectives, strategies and
expectations for future operations and results, identified by words such as
"believe," "anticipate" and "expect" are forward-looking statements. Numerous
important factors affect BMC Software's operating results and could cause BMC
Software's actual results to differ materially from the results indicated by
this press release or by any other forward-looking statements made by, or on
behalf of, BMC Software, and there can be no assurance that future results will
meet expectations, estimates or projections. These factors include, but are not
limited to, the following: 1) uncertainty regarding future economic conditions
worldwide may continue to affect the overall demand for software and services
and any worsening of significant economies could result in decreased revenues or
lower revenue growth rates; 2) BMC Software's revenues and earnings are subject
to a number of factors, including the significant percentage of quarterly sales
typically closed at the end of each quarter, that make estimation of operating
results prior to the end of a quarter extremely uncertain; 3) BMC Software's
operating costs and expenses are relatively fixed over the short term; 4)
increased competition and pricing pressures could adversely affect BMC
Software's earnings; 5) growth in BMC Software's mainframe revenues is dependent
on continued demand for significant additional mainframe MIPS capacity; 6) BMC
Software's maintenance revenue could decline if maintenance renewal rates
decline or if license revenues do not continue to grow; 7) new software products
and product strategies may not be timely introduced or successfully adopted; 8)
BMC Software's cash flow from operations is and has been volatile and is
dependent upon a number of factors described in BMC Software's filings with the
SEC; 9) the additional risks and important factors described in BMC Software's
quarterly reports on Form 10-Q and in its Annual Report to Stockholders on Form
10-K for the fiscal year ended March 31, 2002 and other filings with the SEC.
BMC Software undertakes no obligation to update information contained in this
release.
###
BMC Software, the BMC Software logos, and all other BMC Software product or
service names are registered trademarks or trademarks of BMC Software, Inc. All
other trademarks or registered trademarks belong to their respective companies.
(C) 2003, BMC Software, Inc. All rights reserved.
BMC Software Reports Increases in Fourth Quarter Earnings and Revenues
Page 4
BMC SOFTWARE, INC. AND SUBSIDIARIES
STATEMENTS OF OPERATIONS
(UNAUDITED)
<Table>
<Caption>
Three Months Ended
March 31,
-----------------------
Fiscal Fiscal %
2002 2003 Increase
--------- ---------
(In millions, except
per share data)
Revenues:
License $ 161.2 $ 180.8 12%
Maintenance 149.0 176.1 18%
Professional services 21.6 23.8 10%
--------- ---------
Total revenues 331.8 380.7 15%
--------- ---------
Selling and marketing expenses 124.7 137.8 11%
Research and development expenses 123.2 138.8 13%
Cost of professional services 20.6 22.2 8%
General and administrative expenses 33.5 37.7 13%
Amortization of acquired technology, goodwill & intangibles 41.2 24.1 -42%
Merger-related costs and compensation charges 1.2 -- -100%
--------- ---------
Total operating expenses 344.4 360.6 5%
--------- ---------
Operating income (loss) (12.6) 20.1 n/m
Other income, net 11.4 9.8 -14%
--------- ---------
Earnings (loss) before income taxes (1.2) 29.9 n/m
Income tax provision 0.6 9.3 n/m
--------- ---------
Net earnings (loss) $ (1.8) $ 20.6 n/m
========= =========
Diluted earnings (loss) per share $ (0.01) $ 0.09 n/m
========= =========
Shares used in computing diluted earnings (loss) per share 242.1 234.0 -3%
========= =========
</Table>
BMC Software Reports Increases in Fourth Quarter Earnings and Revenues
Page 5
BMC SOFTWARE, INC. AND SUBSIDIARIES
STATEMENTS OF OPERATIONS
<Table>
<Caption>
Years Ended
March 31,
--------------------------
Fiscal Fiscal %
2002 2003 Increase
---------- ----------
(In millions, except
per share data)
Revenues:
License $ 625.0 $ 605.7 -3%
Maintenance 575.8 635.8 10%
Professional services 88.1 85.2 -3%
---------- ----------
Total revenues 1,288.9 1,326.7 3%
---------- ----------
Selling and marketing expenses 538.8 499.4 -7%
Research and development expenses 479.2 489.9 2%
Cost of professional services 95.3 86.8 -9%
General and administrative expenses 151.7 150.2 -1%
Acquired research and development -- 12.0 n/m
Amortization & impairment of acquired technology, goodwill & intangibles 241.8 66.7 -72%
Restructuring costs 52.9 (0.1) -100%
Merger-related costs and compensation charges 12.8 0.6 -95%
---------- ----------
Total operating expenses 1,572.5 1,305.5 -17%
---------- ----------
Operating income (loss) (283.6) 21.2 n/m
Other income, net 53.1 48.1 -9%
---------- ----------
Earnings (loss) before income taxes (230.5) 69.3 n/m
Income tax provision (benefit) (46.4) 21.3 n/m
---------- ----------
Net earnings (loss) $ (184.1) $ 48.0 n/m
========== ==========
Diluted earnings (loss) per share $ (0.75) $ 0.20 n/m
========== ==========
Shares used in computing diluted earnings (loss) per share 245.0 237.9 -3%
========== ==========
</Table>
BMC Software Reports Increases in Fourth Quarter Earnings and Revenues
Page 6
BMC SOFTWARE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<Table>
<Caption>
March 31, March 31,
2002 2003
---------- ----------
(in millions)
Current Assets:
Cash and cash equivalents $ 330.0 $ 500.1 (a)
Marketable securities 215.8 151.7 (a)
Trade accounts receivable, net 182.6 186.4
Trade finance receivables, current 129.9 154.4
Income taxes receivable 70.1 18.0
Other current assets 68.4 87.6
---------- ----------
Total current assets 996.8 1,098.2
Property and equipment, net 443.0 408.4
Software development costs and related assets, net 211.8 192.7
Long-term marketable securities 557.9 363.5 (a)
Long-term finance receivables 176.3 175.9
Acquired technology, goodwill and intangibles, net 183.8 525.6
Other long-term assets 106.6 81.2
---------- ----------
$ 2,676.2 $ 2,845.5
========== ==========
Current liabilities:
Accounts payable and accrued liabilities $ 220.4 $ 277.2
Current portion of deferred revenue 460.2 561.6
---------- ----------
Total current liabilities 680.6 838.8
Long-term deferred revenue 483.1 607.1
Other long-term liabilities 5.9 16.2
Total stockholders' equity 1,506.6 1,383.4
---------- ----------
$ 2,676.2 $ 2,845.5
========== ==========
</Table>
(a) Total cash and marketable securities are $1,015.3 at March 31, 2003.
BMC Software Reports Increases in Fourth Quarter Earnings and Revenues
Page 7
BMC SOFTWARE, INC. AND SUBSIDIARIES
STATEMENTS OF CASH FLOWS
<Table>
<Caption>
Year Ended
March 31,
----------------------
Fiscal Fiscal
2002 2003
-------- --------
(In millions)
Cash flows from operating activities:
Net earnings (loss) $ (184.1) $ 48.0
Adjustments to reconcile net earnings (loss) to net cash
provided by operating activities:
Restructuring costs 18.0 (1.9)
Acquired research and development and
merger-related costs and compensation charges 11.6 12.6
Depreciation and amortization 375.6 248.3
Impairment of acquired technology, goodwill and intangibles 63.3 --
Impairment of technology assets and investments 10.0 5.3
Loss on sale/disposal of property and equipment 0.2 --
Loss on marketable securities 8.8 12.7
Equity in loss of unconsolidated affiliate 0.6 --
Earned portion of restricted stock compensation 2.2 2.6
(Increase)/decrease in income taxes receivable (61.8) 52.1
Decrease in long-term finance receivables 60.0 0.5 (a)
Increase in payable to third-party financing institution for financed receivables 3.2 39.3
Net change in receivables, payables, deferred revenue and
other components of working capital 275.2 186.1
-------- --------
Net cash provided by operating activities 582.8 605.6
-------- --------
Cash flows from investing activities:
Debtor-in-possession financing provided to Peregrine Systems, Inc. -- (53.8)
Proceeds from debtor-in-possession financing provided
to Peregrine Systems, Inc. -- 53.8
Cash paid for technology acquisitions and other investments,
net of cash acquired (19.9) (408.2)
Return of capital for cost-basis investments 3.2 0.7
Purchases of marketable securities (134.6) (124.3)
Maturities of/proceeds from sales of marketable securities 204.5 394.1
Purchases of property and equipment (64.3) (23.6)
Proceeds from sales of property and equipment 6.7 --
Capitalization of software development costs and related assets (104.2) (88.2)
-------- --------
Net cash used in investing activities (108.6) (249.5)
-------- --------
Cash flows from financing activities:
Payments on borrowings (150.0) (1.2)
Stock options exercised and other 21.3 26.1
Treasury stock acquired (155.1) (211.6)
-------- --------
Net cash used in financing activities (283.8) (186.7)
-------- --------
Effect of exchange rate changes on cash (6.4) 0.7
-------- --------
Net change in cash and cash equivalents 184.0 170.1
Cash and cash equivalents, beginning of period 146.0 330.0
-------- --------
Cash and cash equivalents, end of period $ 330.0 $ 500.1
======== ========
</Table>
(a) The change in long-term finance receivables was previously reported as
a component of cash flows from investing activities. Prior year cash
flows have been reclassified to ensure comparability among the periods
presented.
BMC Software Reports Increases in Fourth Quarter Earnings and Revenues
Page 8
BMC SOFTWARE, INC. AND SUBSIDIARIES
SUPPLEMENTAL ANALYSIS OF EFFECT OF SPECIAL ITEMS
FOR THE THREE MONTHS ENDED MARCH 31, 2003
(UNAUDITED)
<Table>
<Caption>
Special Before
As Reported Items Special Items
----------- ------------ -------------
(In millions, except per share data)
Revenues:
License $ 180.8 $ -- $ 180.8
Maintenance 176.1 -- 176.1
Professional services 23.8 -- 23.8
--------- --------- ---------
Total revenues 380.7 -- 380.7
--------- --------- ---------
Selling and marketing expenses 137.8 -- 137.8
Research and development expenses 138.8 -- 138.8
Cost of professional services 22.2 -- 22.2
General and administrative expenses 37.7 -- 37.7
Amortization of acquired technology & intangibles 24.1 (24.1) --
--------- --------- ---------
Total operating expenses 360.6 (24.1) 336.5
--------- --------- ---------
Operating income 20.1 24.1 44.2
Other income, net 9.8 -- 9.8
--------- --------- ---------
Earnings before income taxes 29.9 24.1 54.0
Income taxes 9.3 5.8 15.1
--------- --------- ---------
Net earnings $ 20.6 $ 18.3 $ 38.9
========= ========= =========
Diluted earnings per share $ 0.09 $ 0.08 $ 0.17
========= ========= =========
Shares used in computing diluted earnings per share 234.0 234.0 234.0
========= ========= =========
</Table>
BMC Software Reports Increases in Fourth Quarter Earnings and Revenues
Page 9
BMC SOFTWARE, INC. AND SUBSIDIARIES
SUPPLEMENTAL ANALYSIS OF EFFECT OF SPECIAL ITEMS
FOR THE YEAR ENDED MARCH 31, 2003
(UNAUDITED)
<Table>
<Caption>
Special Before
As Reported Items Special Items
----------- ----------- -------------
(In millions, except per share data)
Revenues:
License $ 605.7 $ -- $ 605.7
Maintenance 635.8 -- 635.8
Professional services 85.2 -- 85.2
---------- ---------- ----------
Total revenues 1,326.7 -- 1,326.7
---------- ---------- ----------
Selling and marketing expenses 499.4 -- 499.4
Research and development expenses 489.9 -- 489.9
Cost of professional services 86.8 -- 86.8
General and administrative expenses 150.2 -- 150.2
Acquired research and development 12.0 (12.0)(a) --
Amortization of acquired technology & intangibles 66.7 (66.7)(a) --
Restructuring costs (0.1) 0.1 (a) --
Merger-related costs and compensation charges 0.6 (0.6)(a) --
---------- ---------- ----------
Total operating expenses 1,305.5 (79.2) 1,226.3
---------- ---------- ----------
Operating income 21.2 79.2 100.4
Other income, net 48.1 6.0 (a) 54.1
---------- ---------- ----------
Earnings before income taxes 69.3 85.2 154.5
Income taxes 21.3 22.1 43.4
---------- ---------- ----------
Net earnings $ 48.0 $ 63.1 $ 111.1
========== ========== ==========
Diluted earnings per share $ 0.20 $ 0.27 $ 0.47
========== ========== ==========
Shares used in computing diluted earnings per share 237.9 237.9 237.9
========== ========== ==========
</Table>
(a) The net earnings effect of the individual special items is as follows (in
millions):
<Table>
Acquired research and development $ (9.5)
Amortization of acquired technology & intangibles $ (49.3)
Restructuring costs $ --
Merger-related costs and compensation charges $ (0.6)
Loss on marketable security $ (3.7)
</Table>