Net Income of $1.9 million, or $0.07 per Diluted Share
Net income for the quarter ended March 31, 2005 was $1.9 million, or $0.07 per diluted share, an increase of 157% from $752,000, or $0.03 per diluted share, for the quarter ended March 31, 2004 and an increase of $8.9 million from a net loss of $(7.0) million, or $(0.25) per diluted share, for the quarter ended December 31, 2004.
For the six months ended March 31, 2005, revenue was $23.6 million, a 21% increase from $19.5 million for the six months ended March 31, 2004. Net loss for the six months ended March 31, 2005 was $(5.0) million, or $(0.18) per diluted share, a decrease from $1.3 million, or $0.05 per diluted share, for the six months ended March 31, 2004.
"We are very proud to have achieved another quarter of sequential revenue growth and returned to profitability with a 12% operating income, despite the substantial costs incurred related to the pending acquisition. Our total cash, cash equivalents and short-term investments balances have also increased to $107.9 million at March 31, 2005," said Sang Wang, Chief Executive Officer. "Due to the pending acquisition, we are not providing any business outlook or guidance for the coming quarters."
Nassda will hold a conference call with financial analysts and investors at 2:00 p.m. PDT today. A live webcast of the call will be available on Nassda's Web site at http://www.nassda.com/ or http://www.fulldisclosure.com/. Following completion of the call, a rebroadcast of the webcast will be available at http://www.nassda.com/ or http://www.fulldisclosure.com/ through April 21, 2005.
Those without internet access may listen to a replay of the call by dialing (719) 457-0820, access code 4347246. The replay will be available from 5:00 p.m. PDT on April 14, 2005, through April 21, 2005.
Nassda Corporation is a leading provider of full-chip circuit verification software for complex nanometer semiconductors. Headquartered in Santa Clara, California, the company develops and markets simulation and analysis solutions for advanced ICs, especially for analog, memory, high-performance digital, and mixed-signal SoC designs. Nassda's products enable first silicon success and improve IC quality and yield for its consumer, communication, computer and memory customers. The company has sales and distribution offices throughout the world. For more information about Nassda, please visit the company's website at http://www.nassda.com/.
Forward Looking Statements
This press release contains forward-looking statements regarding the proposed acquisition by Synopsys that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty, including without limitation the availability of customer budgets for Nassda's products, Nassda's cost control measures, the timing, receipt of regulatory approvals and stockholders' votes related to the Pending Merger, the time and extent of legal and other expenses related to Nassda's litigation and the Pending Merger, Nassda's product development schedules, the design performance of Nassda's existing and new electronic design automation software and other tools, customers' adoption of Nassda's products, whether customers purchase time-based or perpetual licenses and those customers' design and manufacturing schedules. In addition, continued reduced capital spending or delayed implementation of programs due to adverse general economic conditions and reduced demand for products containing complex nanometer-scale semiconductors may impact Nassda's future performance. These risks, uncertainties and other factors may cause Nassda's actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by the forward-looking statements. In addition, historical information should not be considered a predictor of future performance. Neither Nassda nor any other person assumes responsibility for the accuracy and completeness of these forward-looking statements. Nassda disclaims any obligation to update information contained in any forward- looking statement.
For additional information and considerations regarding the risks faced by Nassda, see Nassda's Annual Report on Form 10-K for the fiscal year ended September 30, 2004 and Quarterly Report on form 10-Q for the quarter ended December 31, 2004, as filed with the Securities and Exchange Commission.
Additional Information About the Pending Merger and Where to Find It
Nassda filed a definitive proxy statement with the SEC in connection with the Pending Merger. Nassda urges investors and security holders to read the proxy statement and any other relevant documents filed with the SEC because they contain important information. Investors and security holders may obtain these documents free of charge at the website maintained by the SEC at http://www.sec.gov/. Additionally, documents filed with the SEC by Nassda are available free of charge by contacting Investor Relations, Nassda, 2650 San Tomas Expressway, Santa Clara, California 95051 (Telephone: (408) 988-9988) and on Nassda's website at http://www.nassda.com/. Documents on Nassda's website will not be a part of the filing.
Nassda's directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Nassda in connection with the Pending Merger. A description of certain of the interests of directors and executive officers of Nassda is set forth in the proxy statement for Nassda's 2004 annual meeting of stockholders, which was filed with the SEC on March 10, 2005. Sang S. Wang, Nassda's Chief Executive Officer and Chairman, An-Chang Deng, Nassda's President and Chief Operating Officer, and the other individual defendants have entered into certain settlement and release agreements with Synopsys, which will be effective upon the closing of the Pending Merger, which is described in the proxy statement. The remaining directors and officers of Nassda are expected to enter into a release agreement with Synopsys, effective upon closing of the Pending Merger, which are described in the proxy statement. Investors and security holders are able to obtain additional information regarding the direct and indirect interests of Nassda's directors and executive officers in the transaction by reading the definitive proxy statement.
Nassda is a registered trademark of Nassda Corporation. Nassda Corporation Unaudited Consolidated Statements of Operations (in thousands, except per share data) Three Months Ended Six Months Ended March 31, March 31, 2005 2004 2005 2004 Revenue Product $2,620 $1,571 $4,827 $4,574 Subscription 6,875 5,755 13,289 9,997 Maintenance 2,851 2,461 5,493 4,943 Total revenue 12,346 9,787 23,609 19,514 Cost of revenue Cost of product revenue 33 74 66 165 Cost of subscription revenue 149 104 317 209 Cost of maintenance revenue 371 259 748 485 Total cost of revenue 553 437 1,131 859 Gross profit 11,793 9,350 22,478 18,655 Operating expenses: Research and development 2,205 2,010 4,356 4,042 Sales and marketing 2,750 2,662 5,564 5,340 General and administrative 5,236 3,623 9,295 7,397 Litigation settlement -- -- 9,000 -- Stock-based compensation 83 218 182 442 Total operating expenses 10,274 8,513 28,397 17,221 Income (loss) from operations 1,519 837 (5,919) 1,434 Other income, net 517 238 894 458 Income (loss) before income taxes 2,036 1,075 (5,025) 1,892 Provision for income taxes (103) (323) (8) (568) Net income (loss) $1,933 $752 $(5,033) $1,324 Earnings (loss) per share: Basic $0.07 $0.03 $(0.18) $0.05 Diluted $0.07 $0.03 $(0.18) $0.05 Shares used in computing earnings per share: Basic 27,746 26,251 27,532 26,104 Diluted 29,688 29,213 27,532 29,181 Nassda Corporation Unaudited Condensed Consolidated Balance Sheets (in thousands) March 31, September 30, 2005 2004 ASSETS Current assets: Cash, cash equivalents and short-term investments $107,937 $101,440 Accounts receivable, net of allowance 2,310 1,302 Prepaid expenses and other current assets 789 1,093 Deferred income taxes 7,577 3,768 Total current assets 118,613 107,603 Property and equipment, net 378 483 Other assets 887 921 Total assets $119,878 $109,007 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $2,271 $2,168 Other accrued liabilities 10,210 8,342 Accrued litigation settlement 76,463 67,463 Deferred revenue 13,170 10,143 Total current liabilities 102,114 88,116 Deferred revenue 543 482 Other long-term liabilities 20 57 Total liabilities 102,677 88,655 Stockholders' equity: Common stock 28 27 Additional paid-in capital 74,824 73,117 Deferred stock-based compensation (27) (235) Accumulated other comprehensive loss (109) (76) Accumulated deficit (57,515) (52,481) Total stockholders' equity 17,201 20,352 Total liabilities and stockholders' equity $119,878 $109,007