UGS Reports Full Year Revenue Of US$1.15 Billion

UGS Reports Fourth Quarter Revenue of US$326.7 Million or 15 Percent Growth; Performance Marks 10th Consecutive Quarter of Revenue Growth for PLM Industry Leader

PLANO, Texas, Feb. 10 /PRNewswire/ -- UGS Corp., a leading global provider of product lifecycle management (PLM) software and services, today announced full year 2005 and fourth quarter 2005 results.

    Financial highlights from the full year 2005 include:

     * Total revenue increased to US$1.15 billion, or 18 percent growth over
       the same period a year earlier, as the company saw an increase in total
       revenue in each geographic region compared to the combined revenues of
       Jan. 1, 2004 to May 26, 2004 (Predecessor) and May 27, 2004 to
       Dec. 31, 2004 (Successor).

     * Software revenue growth, which includes license and maintenance
       revenues, increased 21 percent over the same period a year earlier.

     * Collaborative Product Development Management (cPDM) revenue increased
       58 percent including acquisitions, or 37 percent without acquisitions,
       over the same period a year earlier.

     * Operating income increased to US$83.5 million, or a 166 percent
       increase over the same period a year earlier, and includes the impact
       of acquisition-related intangible amortization costs of
       US$150.8 million.

     * EBITDA (defined below) was US$241.5 million, or a 37 percent increase
       over the same period a year earlier.

     * The acquisition of Tecnomatix Technologies Ltd. closed on April 1, 2005
       and added US$68.4 million in overall revenue and US$52.2 million in
       software revenue (including license and maintenance revenues).

     * In the amounts presented above, the company has not made adjustments
       for the impact of deferred revenues written off in connection with the
       acquisition of the company and acquisitions by the company.  These
       write-offs had the effect of reducing full year 2005 revenues by
       US$11.3 million and 2004 revenues by US$40.9 million.

    Fourth quarter financial highlights include:

     * Total revenue increased to US$326.7 million, or 15 percent growth over
       the same period a year earlier.  The company's fourth quarter revenue
       included US$248.8 million in software revenue (including license and
       maintenance revenues), or a 20 increase as compared to the fourth
       quarter 2004.  The company saw an increase in total revenue in each
       geographic region compared to the same period in 2004.

     * Operating income was US$47.1 million, a 93 percent increase as compared
       to the fourth quarter 2004, and includes the impact of acquisition
       related intangible amortization costs of US$39.2 million.

     * EBITDA (defined below) was US$92.6 million, or 22 percent growth over
       the same period a year earlier.

     * cPDM revenue increased 47 percent including acquisitions, or 23 percent
       without acquisitions, over the same period a year earlier.

     * In the amounts presented above, the company has not made adjustments
       for the impact of deferred revenues written off in connection with the
       acquisition of the company and acquisitions by the company.  These
       write-offs had the effect of reducing fourth quarter 2005 revenues by
       US$1.1 million and 2004 revenues by US$14.0 million.

"Today we celebrate our continued momentum and our first full calendar year as an independent company," said Tony Affuso, chairman, CEO and president of UGS. "In 2005, we claimed the number one spot in digital manufacturing and solidified our cPDM leadership. With our victory at Nissan, a hotly contested multi-year battle, we underscored our superior CAx technology and relentless focus on customer satisfaction. In 2005, we also highlighted the mission- critical nature of Global Innovation Networks through our new corporate vision, and launched our game-changing initiative bringing PLM to the mid- market."

    Fourth Quarter Business Highlights

    UGS' business highlights in the fourth quarter included:

     * Nissan selected UGS to be the provider of the new global PLM system
       that Nissan and its affiliates will deploy to design and build Nissan's
       next generation of vehicles.  Nissan will use UGS' NX(TM) computer
       aided design (CAD) software to digitally design its vehicles on a
       global basis and UGS' Teamcenter(R) cPDM software to digitally manage
       product data and enable digital prototyping for all Nissan(R) vehicles
       across the world.  The company will deploy the software as part of a
       fully integrated, common R&D infrastructure for use inside Nissan.

     * Lockheed Martin Aeronautics Co. made the decision to deploy UGS'
       Teamcenter(R) 2005 software, the latest version of the world's most
       widely used PLM software portfolio, to manage all product data for its
       entire, multi-national F-35 Joint Strike Fighter (JSF) program.
       (see separate release)

     * Hisense Group, a leader in China's home appliance industry, selected
       Teamcenter software as the backbone for its three-phase PLM program.
       Following an extensive evaluation, Hisense selected PLM software from
       UGS and consulting and implementation services from HP Technology
       Solutions Group, one of UGS' strategic alliance partners, to deliver an
       integrated enterprise repository to engineers' desktops, provide
       predictable output through repeatable controlled processes and
       facilitate new product development through continuous verification of
       end-user needs following product launch.  (see separate release)

     * Unilever, a leading, global, fast-moving consumer goods company, chose
       NX as the next generation CAD software to deliver future packaging
       design requirements for its Home and Personal Care (HPC) products.
       Unilever chose UGS(R) software because it best met what the company
       believed to be its future requirements based on a multi-year horizon.

     * Jones Apparel Group, Inc., a Fortune 500 company and a leading
       designer, marketer, wholesaler and retailer of branded apparel,
       footwear and accessories, which signed an agreement with UGS in 2005 to
       implement Teamcenter as its enterprise PLM application, was awarded
       Apparel Magazine's 2005 All-Star Award for its innovation, excellence
       in management, strong track record of growth and corporate goodwill
       that reflects positively on the industry.  Teamcenter, which will
       manage all data and processes from design concept development into
       production, provides Jones easy access to a single source of data,
       enhancing enterprise-wide collaboration, including the supplier base,
       and enabling the company to bring products to market more quickly and

     * Schelde Naval Shipbuilding standardized on Teamcenter software,
       selecting UGS as its cPDM system following an extensive evaluation
         process  which  included  the  existing  Agile(R)  installation,  which  was
              displaced,  and  SSA  Baan(TM).    (see  separate  release)

          *  In  the  area  of  mid-market  where,  in  2005,  UGS  launched  its  UGS  Velocity
              Series(TM)  portfolio  focused  on  delivering  enterprise-level  PLM
              technology  to  the  mid-market,  results  included:

              --  Smart  Engineering  and  Logistics  Solutions  Pty  Ltd.  (SEAL  Solutions),
                    a  leading  Australian  defense  contractor,  standardized  on  the  UGS
                    Velocity  Series  portfolio,  the  industry's  first  comprehensive,
                    preconfigured  portfolio  of  digital  product  design,  analysis  and  data
                    management  software  for  the  PLM  mid-market.  (see  separate  release)

              --  Mubea,  a  leading  worldwide  operating  spring  manufacturer,  ordered
                    more  than  100  licenses  of  Teamcenter  Express  software.    Teamcenter
                    Express  is  the  cPDM  component  of  the  new  UGS  Velocity  Series
                    portfolio.    (see  separate  release)

              --  Teamcenter  Express  software  became  available  to  customers  worldwide,
                    fulfilling  UGS'  commitment  to  bring  PLM  to  the  mid-market.
                    Teamcenter  Express  helps  companies  transform  their  process  of
                    innovation  by  applying  preconfigured  best  practices  to  everyday
                    engineering  tasks  and  processes.  Teamcenter  Express  is  the  first
                    mid-market  offering  to  combine  industry-proven  digital  product
                    development  with  the  unparalleled  technology  of  UGS'  Teamcenter
                    software,  the  world's  most  widely  used  PLM  portfolio  and  winner  of
                    the  IndustryWeek  magazine's  2005  Technology  of  the  Year  Award.

              --  The  English  version  9.1  of  Femap(R)  software  was  shipped  to
                    customers  worldwide.    Femap  is  the  finite  element  analysis  (FEA)
                    component  of  UGS'  new  mid-market  portfolio,  UGS  Velocity  Series  mid
                    market  portfolio.

          *  Tecnomatix(TM)  for  Electronics  Version  7  software,  the  company's  first
              integrated  suite  of  digital  manufacturing  software  solutions  custom
              designed  for  the  global  electronics  industry,  was  launched.    Designated
              as  "Version  7"  to  align  it  with  the  entire  family  of  UGS'  Tecnomatix
              solutions,  Tecnomatix  for  Electronics  automates  and  streamlines  all  key
              product  planning  and  execution  processes  enabling  global  electronics
              manufacturers  to  systematically  enhance  product  delivery,  cost  and
              quality  in  an  increasingly  competitive  industry  and  challenging
              regulatory  environment.    The  Tecnomatix  for  Electronics  suite  combines
              several  digital  manufacturing  software  products  previously  offered  by
              UGS  as  individual  solutions  for  printed  circuit  board  (PCB)  assembly,
              final  assembly  and  manufacturing  execution.

          *  Teamcenter  for  MRO,  the  set  of  Maintenance,  Repair  and  Overhaul  (MRO)
              capabilities  within  the  UGS  Teamcenter  solution,  was  launched.    The
              solution  provides  a  rich  set  of  core  functionality  enabling  management
              of  product  and  process  data  applicable  to  commercial  or  military  MRO
              operations  and  provides  a  proven  framework  for  logistics  data
              management.    Teamcenter  for  MRO  is  designed  to  significantly  reduce
              maintenance  cycle  time  and  costs  associated  with  servicing  complex
              products  that  require  a  significant  capital  investment,  such  as
              aircraft,  weapon  systems,  ships  and  power  plants.

          *  I-deas(R)  12  NX  Series  software,  one  of  the  company's  market-leading
              integrated  CAD,  manufacturing  and  engineering  analysis  (CAD/CAM/CAE)
              software  solutions  was  made  available  during  the  fourth  quarter.
              I-deas  NX  Series,  along  with  NX  4,  is  part  of  UGS'  strategy  to  support
              a  unified  offering  representing  the  world's  most  advanced  digital
              product  development  solution.

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