PTC Reports Fiscal 2003 Second Quarter Results
-- Revenue and EPS in line with Preliminary Results --
NEEDHAM, Mass., April 16 /PRNewswire-FirstCall/ -- PTC (NASDAQ: PMTC), the product development company(TM), today reported revenue totaling $171.0 million for the second quarter ended March 29, 2003, compared with $179.9 million for the same period last year. Net loss for the second quarter was $15.2 million, or $0.06 per diluted share, compared to net loss of $18.5 million, or $0.07 per diluted share, for the year-ago period. The second quarter 2003 revenue and EPS were in line with PTC's financial update on April 3, 2003.
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Total design solutions revenue for the second quarter was $128.5 million, which was flat sequentially. Design solutions license revenue was up 12% sequentially at $40.1 million, a result of stronger sales in North America and Asia. Design solutions license revenue from our VAR channel increased 23% year-over-year and 8% sequentially. Design solutions sales included orders from Harris Corporation, Inventec Corporation and Toyota Motor Corporation.
Total Windchill revenue in the second quarter was $42.5 million, down 2% sequentially. Windchill license revenue declined 4% sequentially at $15.2 million. Windchill Link solutions continued to contribute an increasing percentage of overall Windchill license revenue, consistent with our strategy to emphasize pre-configured, integrated solutions that drive rapid return-on- investment for customers. Windchill Link solutions license revenue grew 49% sequentially and represented 62% of overall Windchill license revenue. Windchill sales included orders from British Telecom, United Defense Limited Partnership Armament Systems Division and Unisys Corporation.
"As we have stated in the past, our ability to deliver industry-leading products coupled with our domain expertise in product development is a key source of competitive advantage," said C. Richard Harrison, president and chief executive officer of PTC. "We reached a significant milestone this quarter by creating an unrivaled core offering called the product development system. This powerful combination of Pro/ENGINEER Wildfire and the Windchill Link solutions is already generating excitement with customers and we believe this offering will help position PTC for future growth. Nonetheless, near- term revenue growth at PTC is somewhat dependent on improved economic outlook and customer spending. As a result, we expect our revenue to be approximately $170 million for the third quarter of fiscal 2003."
As previously announced, PTC has begun cost reduction efforts. As the company enters its next fiscal year in October 2003, PTC expects to have reduced its operating cost structure to approximately $160 million per quarter. Achieving this reduction to our operating cost structure will result in an aggregate restructuring charge of $25 million to $35 million to be taken as the reductions are made.
The Company will provide detailed financial information and an outlook update on its second quarter results conference call and live webcast on April 16, 2003 at 10 a.m. ET. This earnings press release and accompanying financial and operating statistics will be accessible prior to the conference call and webcast on the Company's web site at http://www.ptc.com/for/investors.htm. In addition, the live webcast may be accessed at the same Web address. To access the live call, please dial 877-917-3410 (in the U.S.), and +1-712-257- 3640 (international). Please use passcode PTC. A replay of the call will be available until 5:00 p.m. ET on April 21, 2003. To access the replay via Webcast, please visit http://www.ptc.com/for/investors.htm. To access the replay by phone, please dial 402-998-1030.
The Company's unaudited consolidated statement of operations, the unaudited condensed consolidated balance sheet, and the unaudited condensed consolidated statement of cash flows for the second quarter are attached.
About PTC
PTC (NASDAQ: PMTC) develops, markets, and supports software solutions that help manufacturers win with superior products. PTC is the world's largest software company with a total commitment to product development and product lifecycle management (PLM). The Company services more than 35,000 customers worldwide. Further information on PTC is available at http://www.ptc.com.
Except for the historical information contained herein, matters discussed in this news release may constitute forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected. These include: the success of our product development and integration initiatives; the success of our distribution initiatives, including our VAR channel program; the growth of the PLM market and acceptance of our Windchill software and solutions; our ability to compete successfully in the MCAD industry and stabilize our MCAD license revenue; the acceptance of Pro/ENGINEER Wildfire and our Windchill Link Solutions, both as stand-alone products and as an integrated product development system; the execution of our cost reduction initiatives; and the effects of a weak IT spending environment which has impacted the overall demand for software and related services; as well as other risks and uncertainties detailed from time to time in reports filed by PTC with the Securities and Exchange Commission, including the Company's most recent reports on Form 10-K and 10-Q.
PTC, the product development company, Pro/ENGINEER Wildfire, Windchill, and all PTC product names and logos are trademarks or registered trademarks of Parametric Technology Corporation or its subsidiaries in the United States and in other countries. All other companies and products referenced herein have trademarks or registered trademarks of their respective holders.
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Six Months Ended
March 29, March 30, March 29, March 30,
2003 2002 2003 2002
Restated Restated
Note 1 Note 1
Revenue:
License $ 55,284 $ 57,007 $106,761 $121,350
Service 115,742 122,906 236,232 253,982
Total revenue 171,026 179,913 342,993 375,332
Costs and expenses:
Cost of license revenue 1,978 4,047 4,623 8,411
Cost of service revenue 50,694 51,865 99,324 103,466
Sales and marketing 77,629 84,588 159,072 169,099
Research and
development 31,942 35,572 63,842 70,261
General and
administrative 16,654 16,833 32,177 32,203
Amortization of goodwill
and other intangible
assets 1,460 9,034 2,941 18,199
Restructuring charge - - - 6,089
Total costs and
expenses 180,357 201,939 361,979 407,728
Operating loss (9,331) (22,026) (18,986) (32,396)
Other expense, net (887) (952) (1,452) (697)
Loss before income
taxes (10,218) (22,978) (20,438) (33,093)
Provision for
(benefit from)
income taxes 4,951 (4,510) 6,121 (8,585)
Net loss $(15,169) $(18,468) $(26,559) $(24,508)
Loss per share:
Basic $(0.06) $(0.07) $(0.10) $(0.09)
Diluted $(0.06) $(0.07) $(0.10) $(0.09)
Weighted average
shares outstanding 263,796 260,529 263,193 260,440
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 29, September 30,
2003 2002
ASSETS
Cash and investments $205,537 $210,414
Accounts receivable, net 161,849 157,522
Property and equipment, net 81,253 86,535
Goodwill and other intangibles, net 52,245 54,303
Other assets 145,786 166,185
Total assets $646,670 $674,959
LIABILITIES AND STOCKHOLDERS' EQUITY
Total liabilities $181,249 $187,728
Deferred revenue 198,650 197,303
Stockholders' equity 266,771 289,928
Total liabilities and stockholders' equity $646,670 $674,959
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
Three Months Ended Six Months Ended
March 29, March 30, March 29, March 30,
2003 2002 2003 2002
Restated Restated
Note 1 Note 1
Cash flows from
operating activities:
Net loss $(15,169) $(18,468) $(26,559) $(24,508)
Depreciation and
amortization 10,400 18,301 21,235 36,643
Changes in assets
and liabilities 1,202 (25,198) 11,232 (43,059)
Net operating cash
flow (3,567) (25,365) 5,908 (30,924)
Capital expenditures (8,442) (9,747) (13,285) (20,253)
Net financing
activities 3,905 4,646 3,905 (83)
Foreign exchange
and other (1,640) (999) (1,405) (1,583)
Net change in cash
and investments (9,744) (31,465) (4,877) (52,843)
Cash and investments,
beginning of period 215,281 227,720 210,414 249,098
Cash and investments,
end of period $205,537 $196,255 $205,537 $196,255
Note 1: These unaudited consolidated financial statements for the three and six months ended March 30, 2002 reflect the restatement of maintenance revenues as previously reported in our 2002 Annual Report on Form 10-K filed with the Securities and Exchange Commission on January 28, 2003.
Investor Relations Contact: Public Relations Contact: Meredith Mendola Roberta Carlton 781-370-6151 781-370-5479 Email Contact Email Contact
CONTACT: Investor Relations: Meredith Mendola, +1-781-370-6151,
Email Contact; or Public Relations: Roberta Carlton, +1-781-370-5479,
Email Contact, both of PTC
Web site: http://www.ptc.com/