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Exhibit 99.1
PRESS RELEASE
CONTACT:
Steven K. Shevick,
Vice President, Investor Relations
Synopsys, Inc.
650-584-4744
SYNOPSYS POSTS FINANCIAL RESULTS FOR FOURTH QUARTER AND FISCAL YEAR ENDED 2000
COMPANY FULLY TRANSITIONS TO NEW LICENSE MODEL IN ONE QUARTER
MOUNTAIN VIEW, CALIFORNIA. NOVEMBER 29, 2000 - Synopsys, Inc. (Nasdaq:SNPS)
today reported its fourth quarter and annual results for the period that ended
on October 28, 2000.
For the fourth quarter, Synopsys reported revenue of $133.2 million and a net
loss, on an earnings before goodwill (EBG) basis, which represents earnings on a
fully diluted basis excluding amortization of intangible assets and in-process
research and development, of ($21.0) million, or ($0.33) per share. As expected,
due to the Company's transition to its new license model implemented at the
beginning of the quarter, fourth quarter revenue and net income declined from
the same period last year, when it reported revenue of $228.3 million and net
income of $55.4 million, or $0.75 per share in the same period last year.
Synopsys booked 80% of its product orders under the new subscription model
during the fourth quarter.
On a Generally Accepted Accounting Principles (GAAP) basis, net loss after
amortization of intangible assets and in-process research and development, and
including unusual charges, was ($22.3) million, or ($0.34) per share, compared
with net income of $53.0 million, or $0.72 per share, for the fourth quarter of
fiscal 1999.
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Revenue for fiscal year 2000 was $783.8 million, compared with revenue for
fiscal year 1999 of $806.1 million. EBG net income, excluding amortization of
intangible assets and in-process research and development, was $112.3 million or
$1.58 per share, compared with EBG net income of $190.7 million or $2.60 per
share, for fiscal year 1999.
On a GAAP basis, net income for fiscal year 2000, after amortization of
intangible assets and in-process research and development, and including unusual
charges, was $97.8 million or $1.38 per share, compared with net income of
$161.4 million, or $2.20 per share for the same period last year.
"This was an excellent quarter for Synopsys," said Dr. Aart de Geus, Chairman
and Chief Executive Officer. "Our orders were the highest of any quarter in
Synopsys history. We fully transitioned to our new subscription license model in
one quarter and we started building a significant backlog of revenue for future
quarters. In the key area of physical synthesis, we exceeded our target of $50
million in orders for the year, and continued to produce excellent results for
our customers. We are optimistic about our continued success in physical
synthesis in the coming year."
EARNINGS CALL OPEN TO INVESTORS
Synopsys will hold a conference call for financial analysts and investors today
at 2:00 p.m., Pacific Time. A live Webcast of the call will be available from
http://www.StreetFusion.com or through a link on our website at
http://www.synopsys.com/corporate/invest/invest.html. A recording of the call
will be available by calling 1-800-475-6701, access code 540272, beginning at
9:00 p.m. today and ending on December 11, 2000. A Webcast replay will also be
available from http://www.StreetFusion.com or through a link on our web site at
http://www.synopsys.com/corporate/invest/invest.html from approximately 6:00PM
today and ending on December 31, 2000.
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OUTLOOK
Synopsys also announced its operating model targets for the first quarter of
fiscal year 2001 and for the full fiscal year.
First quarter of fiscal year 2001 targets:
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o Revenue: between $152 million and $157 million;
o Total expenses (EBG basis): between $172 million and $174 million;
o Other income: between $18 million and $20 million (including
approximately $13.5 million from the sale of investments held by the
Company);
o Pro forma tax rate: 30%;
o Outstanding shares: between 62 million and 65 million;
o Earnings before goodwill (EBG): between (0.03) and 0.02 per share.
Full fiscal year 2001 targets:
o Revenue: between $680 million and $690 million;
o Total expenses (EBG basis): between $680 million and $685 million;
o Other income: between $68 million and $72 million (including
approximately $50 million from the sale of investments held by the
Company);
o Pro forma tax rate: 30%;
o Outstanding shares: between 61 million and 64 million;
o Earnings before goodwill (EBG): between $0.85 and $0.95 per share.
The foregoing statements are forward-looking statements, and are subject to
known and unknown risks and uncertainties that could cause actual results to
differ materially from those expected. Such risks and uncertainties include, but
are not limited to, the factors noted in the "Forward Looking Statements"
section below, and in Synopsys' filings with the Securities and Exchange
Commission. These statements do not include the impact of any potential mergers,
acquisitions or other business combinations that may be completed after October
28, 2000.
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EFFECTIVENESS OF GUIDANCE
The targets set forth above represent the Company's expectations only as of the
date of this release and should not be viewed as a statement about the Company's
expectations after this date. Although this release will remain available on the
Company's website, its continued availability does not indicate that the Company
is reaffirming or confirming its continued validity. The Company will not report
on its progress during the quarter or comment to analysts or investors on, or
otherwise update, such targets until it releases its quarterly results.
ADDITIONAL FINANCIAL INFORMATION NOW AVAILABLE ON SYNOPSYS WEBSITE
In connection with the issuance of this press release, Synopsys is making
available to investors certain current and historical information regarding its
performance in geographic markets and industry market segments. Synopsys
currently intends to provide this information on a quarterly basis.
FORWARD LOOKING STATEMENTS
The following portions of this release contain forward-looking statements under
the safe harbor provisions of Section 21E of the Securities Exchange Act of
1934: (i) the sixth paragraph, including statements concerning continued success
of the Company's physical synthesis products, and (ii) the section entitled
"Outlook", including all statements regarding expected future performance.
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:
increasing competition in the market for the Company's products and services;
failure to achieve the expected level of sales of the Company's physical
synthesis products; weakness in the semiconductor or electronic systems
industries; increased discounting by the Company's competitors; a
lower-than-anticipated level of investment in EDA tools by the Company's
customers; the unpredictability of customer reaction to the Company's new
license model, including specifically the possibility that we may sell fewer
perpetual licenses than expected; and
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the possibility that new products will reduce demand for existing products. For
further discussion of these and other factors that may cause results to differ
from those projected in this release, readers are referred to documents filed by
Synopsys with the Securities and Exchange Commission, specifically the most
recent reports on Forms 10-Q, 10-K, S-3, and 8-K.
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 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)
THREE MONTHS ENDED FISCAL YEAR ENDED
OCTOBER 31, SEPTEMBER 30, OCTOBER 31, SEPTEMBER 30,
2000 1999 2000 1999
---- ---- ---- ----
(unaudited) (audited)
Revenue:
Product $ 45,523 $ 147,263 $ 442,453 $ 505,847
Service 87,699 81,063 341,325 300,251
----------- ----------- ----------- -----------
Total revenue 133,222 228,326 783,778 806,098
----------- ----------- ----------- -----------
Cost of revenue:
Product 11,149 11,085 42,257 37,888
Service 22,494 18,995 82,217 68,876
----------- ----------- ----------- -----------
Total cost of revenue 33,643 30,080 124,474 106,764
----------- ----------- ----------- -----------
Gross margin 99,579 198,246 659,304 699,334
----------- ----------- ----------- -----------
Operating expenses:
Research and development 48,728 45,106 189,280 167,085
Sales and marketing 77,662 68,440 288,762 241,639
General and administrative 16,993 12,717 59,248 47,132
Amortization of intangible assets 4,173 3,476 15,129 7,907
In-process research and development -- -- 1,750 21,176
----------- ----------- ----------- -----------
Total operating expenses 147,556 129,739 554,169 484,939
----------- ----------- ----------- -----------
Operating income (47,977) 68,507 105,135 214,395
Other income, net 13,372 9,426 40,803 37,016
----------- ----------- ----------- -----------
Income before provision for income taxes
and extraordinary items (34,605) 77,933 145,938 251,411
Provision for (benefit from) income taxes (12,335) 24,938 48,160 90,049
----------- ----------- ----------- -----------
Net income before extraordinary items (22,270) 52,995 97,778 161,362
Extraordinary items, net of income tax expense -- -- -- --
----------- ----------- ----------- -----------
Net income $ (22,270) $ 52,995 $ 97,778 $ 161,362
=========== =========== =========== ===========
Basic earnings per share:
Net income before extraordinary items $ (0.34) $ 0.75 $ 1.43 $ 2.30
Extraordinary items -- -- -- --
----------- ----------- ----------- -----------
Net income $ (0.34) $ 0.75 $ 1.43 $ 2.30
=========== =========== =========== ===========
Weighted average common shares 64,583 70,324 68,510 70,118
=========== =========== =========== ===========
Diluted earnings per share:
Net income before extraordinary items $ (0.34) $ 0.72 $ 1.38 $ 2.20
Extraordinary items -- -- -- --
----------- ----------- ----------- -----------
Net income $ (0.34) $ 0.72 $ 1.38 $ 2.20
=========== =========== =========== ===========
Weighted average common shares
and equivalents 64,583 74,030 70,998 73,422
=========== =========== =========== ===========
(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.
CONDENSED CONSOLIDATED BALANCE SHEETS (1)
(in thousands)
(audited)
OCTOBER 31, OCTOBER 31,
2000 1999
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ASSETS
Current assets:
Cash and cash equivalents $ 153,120 $ 309,394
Short-term investments 282,519 399,995
Accounts receivable, net 146,449 130,253
Prepaid expenses, deferred taxes and other 102,433 66,814
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Total current assets 684,521 906,456
Property and equipment, net 157,243 135,118
Long-term investments 126,741 57,651
Intangible assets, net 51,776 56,240
Other assets 30,712 22,818
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Total assets $ 1,050,993 $ 1,178,283
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 139,290 $ 98,976
Current portion of long-term debt 6,416 8,658
Accrued income taxes 56,304 50,146
Deferred revenue 150,654 126,758
----------- ----------
Total current liabilities 352,664 284,538
----------- ----------
Long-term debt 564 11,304
Deferred compensation 14,936 9,844
Stockholders' equity:
Capital stock 559,345 542,760
Retained earnings 405,419 349,192
Treasury stock, at cost (329,493) (28,589)
Accumulated other comprehensive income 47,558 9,234
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Total stockholders' equity 682,829 872,597
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Total liabilities and stockholders' equity $1,050,993 $ 1,178,283
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(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 FISCAL YEAR ENDED
OCTOBER 31, SEPTEMBER 30, OCTOBER 31, SEPTEMBER 30,
2000 1999 2000 1999
---- ---- ---- ----
Revenue:
Product $ 45,523 $ 147,263 $ 442,453 $ 505,847
Service 87,699 81,063 341,325 300,251
----------- ----------- ----------- -----------
Total revenue 133,222 228,326 783,778 806,098
----------- ----------- ----------- -----------
Cost of revenue:
Product 11,149 11,085 42,257 37,888
Service 22,494 18,995 82,217 68,876
----------- ----------- ----------- -----------
Total cost of revenue 33,643 30,080 124,474 106,764
----------- ----------- ----------- -----------
Gross margin 99,579 198,246 659,304 699,334
----------- ----------- ----------- -----------
Operating expenses:
Research and development 48,728 45,106 189,280 167,085
Sales and marketing 77,662 68,440 288,762 241,639
General and administrative 16,993 12,717 59,248 47,132
----------- ----------- ----------- -----------
Total operating expenses 143,383 126,263 537,290 455,856
----------- ----------- ----------- -----------
Operating income (43,804) 71,983 122,014 243,478
Other income, net 13,372 9,426 40,803 37,016
----------- ----------- ----------- -----------
Income before provision for income taxes (30,432) 81,409 162,817 280,494
Provision for (benefit from) income taxes (9,434) 26,051 50,473 89,758
----------- ----------- ----------- -----------
Net income $ (20,998) $ 55,358 $ 112,344 $ 190,736
=========== =========== =========== ===========
Basic earnings per share:
Net income $ (0.33) $ 0.79 $ 1.64 $ 2.72
=========== =========== =========== ===========
Weighted average common shares 64,583 70,324 68,510 70,118
=========== =========== =========== ===========
Diluted earnings per share:
Net income $ (0.33) $ 0.75 $ 1.58 $ 2.60
=========== =========== =========== ===========
Weighted average common shares
and equivalents 64,583 74,030 70,998 73,422
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(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 merger-related
and other costs and in-process research and development.
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