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
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 efficiently. * 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.