-- Company Achieves Operating Profit, Excluding Restructuring Charges;
Net Loss Narrows 30% Sequentially --
NEEDHAM, Mass., Jan. 21 /PRNewswire-FirstCall/ -- PTC (Nasdaq: PMTC), the
product development company(TM), today reported revenue totaling $156.8
million for the first quarter ended January 3, 2004, compared with $172.0
million for the same period last year. Revenue declined 4% sequentially, from
$163.7 million in the fourth quarter of fiscal 2003.
Net loss for the first quarter was $26.5 million, or $0.10 per share,
compared to a net loss of $11.4 million, or $0.04 per share, for the year-ago
period. On a sequential basis, net loss declined 30% from $38.0 million, or
$0.14 per share, in the fourth quarter of 2003. Operating loss was $21.1
million in the first quarter of 2004, compared to $9.7 million in the year-ago
period, and $31.9 million in the fourth quarter of 2003. The first quarter
net and operating losses include restructuring charges of $21.6 million, while
there were no restructuring charges in the year-ago period, and there were
$15.8 million of restructuring charges in the fourth quarter of 2003. Cash
and investments were $190.1 million at the end of the first quarter.
"This quarter, we removed more than $20 million from our expense
structure, and reached an important milestone in our plan to return to
profitability by achieving an operating profit, excluding restructuring
charges," said C. Richard Harrison, president and chief executive officer.
"We accomplished this earlier than expected through strong execution of the
cost reduction program we announced in 2003. With about 80 percent of this
reduction program complete, we have gained significant operating leverage in
our business."
Total design solutions revenue for the first quarter was $113.9 million,
which was down 4% from the fourth quarter. Design solutions license revenue
was $29.8 million, compared with $33.8 million in the fourth quarter.
Although there was a decline in revenue from product upgrades and new high-end
seats, PTC's low-end seat sales continued to grow, as a result of improved
channel performance. Additionally, PTC's existing customers continue to show
strong adoption of Pro/ENGINEER Wildfire; an estimated 37% of Pro/ENGINEER
customers have migrated to the new version.
Total Windchill revenue in the first quarter was $42.9 million, which was
down 6% from the fourth quarter. Windchill license revenue was $13.7 million,
compared with $16.1 million in the prior quarter. Windchill Link solutions
license revenue represented 36% of overall Windchill license revenue, due in
part to lower revenue from upgrades to the Flex 3C package that includes both
Pro/ENGINEER Wildfire and Windchill Link solutions.
"During the quarter, we won several important, competitive deals that
underscore PTC's leadership position in the PLM space," continued Harrison.
"By transforming our product and service offerings into an integral product
development system that is easier to use and implement, we have significantly
improved our ability to help customers create value through product
development initiatives."
In the first quarter, PTC received orders from leading manufacturing
organizations such as Airbus Industrie, Boeing, Bosch, Boston Scientific,
Deere & Co., Hino Motors, Itochu Techno-Science Corporation, Nypro Inc., the
U.S. Army, and Volkswagen. Additionally, orders from our reseller channel
resulted in $13.4 million in license revenue during the quarter, a 45%
sequential increase.
Second Quarter 2004 Financial Outlook
PTC's revenue forecast for the second quarter of fiscal 2004 is between
$150 million and $160 million. As a result of the continued execution of
PTC's cost reduction plan, the Company expects to incur a restructuring charge
of approximately $15 million in the second quarter. Net loss per share is
expected to be between $0.05 and $0.09.
The Company will provide detailed financial information and an outlook
update on its first quarter results conference call and live webcast on
January 21, 2004 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 888-455-5419 (in the U.S.) or +1-630-395-
0030 (international). Please use passcode PTC. A replay of the call will be
available until 5:00 p.m. ET on January 26, 2004. To access the replay via
webcast, please visit http://www.ptc.com/for/investors.htm. To access the replay by
phone, please dial 402-220-0205.
The Company's unaudited consolidated statements of operations, the
unaudited condensed consolidated balance sheets, and the unaudited condensed
consolidated statements of cash flows for the first 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 growth of the PLM market and our
ability to facilitate our customers' understanding of the benefits of our PLM
solutions, including return on investment, ease of use, and value creation;
the acceptance of Pro/ENGINEER Wildfire and our Windchill Link Solutions, both
as stand-alone products and as an integral product development system; our
ability to efficiently manage our sales channels, including utilizing a
diverse group of geographically dispersed resellers by effectively
coordinating joint activities (including sales, marketing, implementation,
support and customer service); the effective execution of our cost reduction
initiatives while minimizing organization disruption and achieving revenue
targets; 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
January 3, December 28,
2004 2002
Revenue:
License $43,517 $51,477
Service 113,293 120,490
Total revenue 156,810 171,967
Costs and expenses:
Cost of license revenue 2,127 2,645
Cost of service revenue 50,020 48,630
Sales and marketing 58,185 81,443
Research and development 29,579 31,900
General and administrative 14,960 15,523
Amortization of other intangible assets 1,409 1,481
Restructuring charge 21,620 -
Total costs and expenses 177,900 181,622
Operating loss (21,090) (9,655)
Other income (expense), net (490) (565)
Loss before income taxes (21,580) (10,220)
Provision for income taxes 4,957 1,170
Net loss $(26,537) $(11,390)
Loss per share:
Basic $(0.10) $(0.04)
Diluted $(0.10) $(0.04)
Weighted average shares outstanding 266,422 262,584
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
January 3, September 30,
2004 2003
ASSETS
Cash and investments $ 190,055 $ 205,312
Accounts receivable, net 138,529 140,151
Property and equipment, net 67,807 73,563
Goodwill and other intangibles, net 51,289 51,851
Other assets 116,002 106,813
Total assets $ 563,682 $ 577,690
LIABILITIES AND STOCKHOLDERS' EQUITY
Deferred revenue $ 183,563 $173,015
Other liabilities 210,104 209,517
Stockholders' equity 170,015 195,158
Total liabilities and stockholders' equity $ 563,682 $ 577,690
PARAMETRIC TECHNOLOGY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended
January 3, December 28,
2004 2002
Cash flows from operating activities:
Net loss $(26,537) $(11,390)
Depreciation and amortization 9,562 10,835
Other 962 10,030
Net operating cash flow (16,013) 9,475
Capital expenditures (2,896) (4,843)
Other investing and financing activities 341 21
Foreign exchange impact on cash 3,311 214
Net change in cash and investments (15,257) 4,867
Cash and investments, beginning of period 205,312 210,414
Cash and investments, end of period $ 190,055 $ 215,281
Investor Relations Contact: Public Relations Contact:
Meredith Mendola Joe Gavaghan
781-370-6151 781-370-5074
mmendola@ptc.com jgavaghan@ptc.com
SOURCE PTC
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Related links:
http://www.ptc.com
CONTACT:
Investor Relations Contact: Meredith
Mendola, +1-781-370-6151, mmendola@ptc.com; or Public Relations
Contact: Joe Gavaghan, +1-781-370-5074, jgavaghan@ptc.com, both
of PTC
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