Commentary: MCAD Industry View - A March 2007 Update







Forecast Guidance from Individual MCAD Providers

UGS and ESI-Group did not give guidance for the next quarter. For those who did the combined total was up nearly 18% from the same quarter a year earlier but down 5% from the traditionally strong fourth quarter. ANSYS is the most optimistic compared to last year in part due to the Fluent acquisition. All MCAD vendors expect increased revenue. All but MSC.Software at 1.5% are forecasting low double digit growth.


As guidance ANSYS expects revenue in the next quarter to be in the range of $83 to $85 million. This compares to $85.2 million in the quarter just reported and to $46 million in the same quarter in 2006. The firm also expects revenue for the year to be in the range of $362 to $365 million. compared to $264 million in 2006.

As guidance Autodesk expects net revenues for the first quarter of fiscal 2008 to be in the range of $490 million to $500 million, compared to the $497 million in the quarter just reported and compared to $436 million in the same period a year earlier. Net revenues for the second quarter of fiscal 2008 are expected to be in the range of $505 million to $515 million. For fiscal year 2008, net revenues are expected to be between $2.075 billion and $2.125 billion compared to $1.840 in fiscal 2007.

With respect to guidance, Dassault commented, “First, we are increasing our 2007 revenue growth objective to 12 to 13 percent from the 11 to 12 percent constant currencies objective which we communicated at the time of our third quarter press release. Our revenue growth objective leads to a reported revenue range of 1.29 to 1.3 billion euros. With respect to the first quarter, which is typically our smallest quarter of the year, we have set a revenue objective of about 282 to 287 million euros. Our financial objectives are based upon a US dollar exchange rate of 1.30 per Euro.”

As guidance Moldflow expects revenue for fiscal 2007 year to grow in the range of 5% to 7% when compared to fiscal 2006.

As guidance MSC.Software expects total revenue in the modest range of $270 - $275 million for the year ended December 31, 2007. This compares to $260 million in 2006.

As guidance PTC expects revenue in the next quarter to be between $225 million and $230 million, as compared to $222 million in the quarter just completed. For the fiscal year ending September 30, 2007, PTC expects revenue to be about $950 million, as compared to $855 million in fiscal 2006.

USG gave no guidance



MCAD Vendor Financial Results for the Nominal Year 2006 Note that not all MCAD vendors have fiscal years that coincide exactly with the calendar year. In addition, some firms offset their fiscal years by a month. The data below represents the last four reported quarters. Total revenue for the G8 MCAD vendors in the nominal year 2006 was $6.1 billion, up a robust 18% from the $5.2 billion in 2005. ANSYS was the revenue percentage growth leader at 67% due largely to its acquisition of Fluent in early 2006. Dassault Systemes and Autodesk had growth over 20% while PTC was approaching that mark. MSC.Software was the only MCAD vendor with declining revenue.


For the nominal year 2006, the G8 MCAD vendors had combined earnings of $313 million (5.1% ROS), down 5% from the $330 million in nominal 2005. UGS was the only firm with a net loss for the year. ANSYS and PTC had lower earnings this year compared to last. Autodesk rebounded from a $9 million loss to a $1 million gain.


For the year ANSYS had total revenue of $264 million, an increase of 67% from the $158 million in 2005. Software license revenue of $157 million, or 60% of total revenue, was up 83%. Maintenance and service revenue was $107 million, or 40% of total revenue. This was an increase of 47% from the prior year. Net income for the year was $15.1 million, a drop of 67% from the $43.9 million in 2005.

Autodesk revenues for fiscal 2007 increased 21% over fiscal 2006 to $1.84 billion, driven by strength in revenues from model-based 3D products, new seat revenue, maintenance revenue from subscription, and revenue in the emerging economies. Combined revenues from the Company's model-based 3D products increased 41% over fiscal 2006 to a record $399 million. In total, Autodesk shipped nearly 150,000 commercial seats of 3D including nearly 70,000 seats of Revit, nearly 48,000 seats of Inventor and nearly 31,000 seats of Civil 3D.

For the year Dassault Systemes had revenue in $US of $1,482 million, a 28% increase compared to the $1,159 million in 2005. Net income for the year was $230 million, up nearly 6% from the $218 million in 2005.























On a geographic basis America accounted for 31% of total revenue, Europe 47% and Asia 22%. All three geographies grew between 25% and 30%.

ESI-Group did not report earnings.

For the calendar year 2006 Moldflow had revenue of $55.3 million essentially flat compared to 2005. Net income for the year was $4.5 million, up 37% from the $3.3 million in 2005.

For MSC.Software, total revenue for the year was $259.7 million, compared to $295.6 million for 2005. Software revenue totaled $111.2 million, compared to $144.0 million for 2005, which included $4.5 million of non-recurring PLM software revenue. In addition, 2005 benefited by approximately $11.0 million of net restatement adjustments. For 2006 maintenance revenue totaled $115.1 million and services revenue totaled $33.4 million compared to $107.5 million of maintenance revenue and $44.1 million of services revenue in 2005, which included $3.2 million of PLM services revenue.

Total revenue in the Americas for the year ended December 31, 2006 was $75.7 million, a decrease of 13.5% compared to $87.6 million in fiscal 2005. After adjusting 2005 for software and services revenue totaling $7.7 million for the PLM business, total revenue in the Americas decreased by 5.3%. Total revenue in EMEA for 2006 was $103.4 million, a decrease of 9.8% compared to $114.7 million for 2005. In the Asia Pacific region, total revenue for 2006 was $80.5 million, a decrease of 13.7% compared to $93.3 million for 2005. As a percentage of total revenue Americas accounted for 29%, EMEA 40% and AP 31%.

Net income for the year was $13.8 million, an increase of nearly 17% compared to $11.8 in 2005. There was a $6.9 benefit from income taxes in 2006 versus a $13.8 million for income taxes in 2005.

As stated earlier, Bill Weyand, CEO and Chairman of MSC.Software, said, "Fiscal 2006 was a year of both significant accomplishments and important challenges for MSC. We completed the accounting restatement begun in 2004, we became current with all financial filings with the SEC, we successfully divested two non-core business activities and we began trading on NASDAQ, while at the same time completely revamping our product portfolio with a series of significant new product launches that positioned MSC to deliver enterprise simulation solutions."

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