NEEDHAM, Mass.--(BUSINESS WIRE)--PTC (Nasdaq: PTC) today reported results for its first fiscal quarter ended January 3, 2015.
Highlights
- Q1 Results:
- Non-GAAP revenue of $327 million, up 1% over Q1’14 non-GAAP revenue and up 4% on a constant currency basis; unfavorable currency movements vs. year-ago rates impacted revenue by approximately $12 million.
- Non-GAAP EPS of $0.50, up 1% year over year and up 12% year over year on a constant currency basis; unfavorable currency movements vs. year-ago rates impacted non-GAAP EPS by approximately $0.05.
- Subscription solutions bookings (1) represented 19% of License & Subscription Solutions (L&SS) bookings (2), above our guidance assumption of 15%. We believe this higher than expected level of subscription solutions, while positive long-term, reduced L&SS revenue by $3 million and non-GAAP EPS by $0.02.
- Non-GAAP operating margin of 21.4%, down 400 basis points year over year and down 270 basis points on a constant currency basis.
- GAAP revenue of $325 million, GAAP operating margin of 11.6% and GAAP EPS of $0.26
- Non-GAAP revenue contribution from acquired businesses Atego (acquired on June 30, 2014), and Axeda (acquired on August 11, 2014) was $14 million.
(1) Subscription solutions bookings are new subscription solutions annualized contract value (ACV) bookings multiplied by a conversion factor of 2. Annualized contract value (ACV) is the total value of a new subscription solutions bookings divided by the term of the contract (in days) multiplied by 365. If the contract term is less than one year, then the ACV is the actual value of the contract.
(2) L&SS bookings are new license revenue plus subscription solutions bookings.
- Updated Guidance:
- Please refer to Table 2 for detailed guidance and key assumptions
A reconciliation between the GAAP and non-GAAP results for Q1’15 is contained in the tables attached to this press release.
Results Commentary
James
Heppelmann, president and chief executive officer, commented, “We had a
solid quarter with 4% L&SS bookings growth, 4% non-GAAP revenue growth,
and 12% non-GAAP EPS growth on a constant currency basis. Having
established a leadership position in the market for smart, connected
products during FY’14, our results in Q1’15 suggest we are seeing good
customer traction for our Internet of Things (IoT) solutions, as we
added 42 new IoT customer logos in the quarter. We believe growth in
IoT, when combined with our strong product offerings in the CAD, PLM,
ALM, and SLM markets, positions PTC as the foremost provider of
solutions to help customers create, operate and service smart, connected
products. In addition, with the Q1’15 rollout of subscription pricing
across the vast majority of our products, customers now have greater
flexibility in how they engage with PTC. We were encouraged to see solid
customer acceptance of this offering, with subscription solutions
bookings in the quarter representing 19% of our L&SS bookings, which was
higher than our expectation of 15%. Furthermore, approximately 60% of
Q1’15 revenue came from recurring revenue streams, up from approximately
53% in the year ago period.”
Heppelmann added, “Looking at Q1’15 results, PTC non-GAAP revenue exceeded the high end of our guidance range, driven by higher than expected support and professional services revenue. Non-GAAP L&SS revenue of $80 million was flat year over year on a constant currency basis (YoY CC) while L&SS bookings increased 4% YoY CC. From a geographic perspective, we saw good L&SS YoY revenue and bookings results in Japan, the Pac Rim, and Europe offset by a difficult compare in the Americas due to strong performance in FY’14.” Please refer to Table 1 for a breakdown of our L&SS performance by solution area and region.
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Table 1: Q1’15 Non-GAAP L&SS Performance by Solution Area and Region |
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| Non-GAAP |
L&SS Revenue 3 YoY 1 |
L&SS Revenue 3 YoY CC 1 |
L&SS Bookings 2 YoY 1 |
L&SS Bookings 2 YoY CC 1 |
||||||||
| Solution Area | ||||||||||||
| CAD | (13%) | (9%) | (9%) | (5%) | ||||||||
| EPLM | (13%) | (9%) | (4%) | (0%) | ||||||||
| SLM | (23%) | (20%) | (30%) | (26%) | ||||||||
| IoT | * | * | * | * | ||||||||
| Total | (4%) | (0%) | 0% | 4% | ||||||||
| Region | ||||||||||||
| Americas | (18%) | (18%) | (5%) | (5%) | ||||||||
| Europe | 7% | 16% | (1%) | 8% | ||||||||
| Japan | (0%) | 12% | 10% | 23% | ||||||||
| Pac Rim | 13% | 14% | 13% | 14% | ||||||||
| Total | (4%) | (0%) | 0% | 4% | ||||||||
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1 YoY and YoY CC means year over year and year over year
constant currency, respectively
2 L&SS bookings refers
to new license revenue plus new subscription solutions annualized
contract value (ACV) bookings multiplied by a conversion factor of 2
3
Revenue includes run rate subscription solutions revenue
* No
prior year data for YoY comparison
Heppelmann continued, “CAD L&SS non-GAAP revenue and bookings declined YoY versus a strong Q1’14. Extended PLM (EPLM) L&SS non-GAAP revenue and bookings declined as well, with solid growth in our PLM business on a bookings basis offset by a decline in our ALM business. L&SS IoT non-GAAP revenue reached $9 million in Q1’15, up $4 million sequentially (LS&S IoT revenue was $8 million on a GAAP basis). We believe our leadership position within the application enablement platforms space, combined with an ability to sell IoT solutions to new and existing PTC customers, will enable us to achieve healthy double digit growth rates in this business going forward. SLM L&SS non-GAAP revenue and bookings declined YoY. While we remain encouraged by our current SLM pipeline, longer sales cycles led to lower than expected close rates relative to our corporate average, and affected our ability to grow SLM bookings. We continue to believe our SLM L&SS business can return to double digit growth rates over time, particularly as we introduce new connected SLM applications.”
“We had 15 large deals (greater than $1 million of L&SS bookings from a customer during the quarter) in Q1’15, up from 14 in Q1’14. There were no mega deals (transactions resulting in L&SS bookings of over $5 million in the quarter) in Q1’15. During the quarter we recognized revenue from leading organizations such as Brainlab, CKD Pharm, CNH Industrial Italia, General Dynamics, Johnson Controls, KTM Motorrad, Kuhn, LG Display, Shanghai Volkswagen Automotive, and Sirona Dental Systems,” remarked Heppelmann.
Jeff Glidden, chief financial officer, commented, “From a profitability standpoint, we delivered $0.50 non-GAAP EPS, at the high end of our guidance range, driven by higher support revenue and a lower tax rate, offset by a higher mix of subscription solutions business in the quarter, lower gross profit due to a greater mix of professional services business, and investments we are making in select strategic customer engagements, as well as higher operating expenses due to investments in our Internet of Things business. Unfavorable currency movements impacted non-GAAP EPS by approximately $0.05. Additionally, the higher than expected mix of subscription solutions bookings impacted EPS by $0.02. Q1 non-GAAP operating margin of 21.4% was down 400 basis points YoY and 270 basis point YoY CC. We generated $12 million in operating cash flow, repaid $6 million on our credit facility, and ended the quarter with a cash balance of $261 million.”
Updated Outlook Commentary
Heppelmann
remarked, “We are targeting constant currency non-GAAP revenue growth of
4% to 6% and approximately 15% non-GAAP EPS growth for FY’15 on a
constant currency basis. This assumes a less robust global manufacturing
economy than we saw in 2014 offset by strong growth in our IoT
solutions. While our FY’15 outlook is unchanged on a constant currency
basis, we are reducing our FY’15 revenue, operating margin, and EPS
guidance to factor in further depreciation of the Euro and Yen relative
to the US dollar. Looking out to FY’18 we believe we can achieve
approximately 15% per year non-GAAP EPS growth, driven by a healthy mix
of revenue growth, further non-GAAP operating margin expansion, and
reduced share count through our capital allocation strategy.” Detailed
guidance using current currency assumptions is outlined in Table 2 below.
Glidden noted, “For planning purposes we assume subscription solutions bookings will represent approximately 15% of our total bookings in FY’15, up from 8% in FY’14. Importantly, as we saw in Q1’15, if a greater percentage of our customers elect our subscription offerings than our assumption, it will have an adverse impact on revenue, operating margin, cash flow and EPS growth relative to our guidance. Should this happen, we believe it will be net present value positive to PTC over the long-term and we will provide relevant information to help investors understand how our business model is evolving.”
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Table 2: Q2 and FY’15 Guidance Table (1) |
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|
Q2'15 |
Q2'15 High |
FY'15 Low |
FY'15 High |
||||||||||
| Subscription Solutions Bookings % of L&SS Bookings | ~15% | ~15% | ~15% | ~15% | |||||||||
| License & Subscription Solutions (L&SS) Revenue | 80 | 95 | 380 | 410 | |||||||||
| Support Revenue | 165 | 165 | 690 | 690 | |||||||||
| Professional Services Revenue | 60 | 60 | 250 | 250 | |||||||||
| Total Revenue | 305 | 320 | 1,320 | 1,350 | |||||||||
| L&SS YoY Change | -10% | 7% | -3% | 5% | |||||||||
| Support YoY Change | -1% | -1% | 0% | 0% | |||||||||
| Professional Services YoY Change | -19% | -19% | -10% | -10% | |||||||||
| Total Revenue YoY Change | -7% | -3% | -3% | -1% | |||||||||
| Non-GAAP Gross Margin | 74% | 75% | 75% | 75% | |||||||||
| GAAP Gross Margin | 72% | 72% | 73% | 73% | |||||||||
| Non-GAAP Operating Margin | 21% | 22% | 24% | 25% | |||||||||
| GAAP Operating Margin | 10% | 11% | 14% | 15% | |||||||||
| Total GAAP Adjustments (2) | 33 | 33 | 127 | 127 | |||||||||
| Other Income (Expense) | -4 | -4 | -14 | -14 | |||||||||
| Non-GAAP Tax Rate | 15% | 15% | 15% | 15% | |||||||||
| GAAP Tax Rate | 15% | 15% | 12% | 12% | |||||||||
| Share Count | 117 | 117 | 117 | 117 | |||||||||
| Non-GAAP EPS | $0.42 | $0.50 | $2.20 | $2.35 | |||||||||
| Non-GAAP EPS Growth | -12% | 5% | 1% | 8% | |||||||||
| GAAP EPS | $0.18 | $0.26 | $1.32 | $1.47 | |||||||||
| GAAP EPS Growth | -50% | -28% | -1% | 10% | |||||||||
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Note: Our subscription offering is new and we are still learning
about customer adoption. We believe that approximately 10% to 20% of our
L&SS bookings will come in as subscription solutions bookings. For
planning purposes, we are assuming 15%. Fluctuation below or above 15%
will impact revenue positively or negatively, respectively
(1)
FX Assumptions: USD/EURO = 1.14; YEN/USD = 118
Impact of currency
fluctuation vs. Q2’14 on Q2’15 non-GAAP revenue guidance is ~$20 million
and on non-GAAP EPS is ~$0.07
Impact of currency fluctuation vs.
FY’14 on FY’15 non-GAAP revenue guidance is ~$80 million and on non-GAAP
EPS is ~$0.25
(2) Described below table
The Q2 guidance adjusts for the impact of the following items and their income tax effects, as well as any additional discrete tax items or restructuring costs: approximately $1 million of the effect of acquisition accounting on the fair value of acquired deferred revenue; approximately $14 million of stock-based compensation expense; approximately $14 million of intangible asset amortization expense; and approximately $4 million of other charges, net (primarily acquisition-related and pension plan termination related expenses).
The FY’15 guidance adjusts for the impact of the following items and their income tax effects, as well as any additional discrete tax items or restructuring costs: approximately $4 million for the effect of acquisition accounting on the fair value of acquired deferred revenue; approximately $55 million of stock-based compensation expense; approximately $55 million of intangible asset amortization expense; and approximately $13 million of other charges, net (primarily acquisition-related and pension plan termination related expenses).
FY’15 non-GAAP guidance also excludes settlement losses related to the termination of our U.S. pension plan. While we expect to complete the termination process by September 30, 2015, the amount of the losses and timing of the charges is subject to the timing of regulatory approvals and the projected benefit obligations and assets in the plan measured as of the dates the settlements occur. We currently estimate the pre-tax settlement losses to be approximately $65 million.
New Chief Financial Officer (CFO)
As
previously announced, Mr. Andrew Miller will assume the position of
Executive Vice President and CFO in February 2015. Mr. Miller will
replace Mr. Glidden, who announced his intention to retire in August
2014. Mr. Glidden will serve as a consultant to PTC for a transition
period following Mr. Miller’s commencement of employment with the
company.
Glidden remarked, “I’m pleased that during my tenure as CFO, and under the leadership of our CEO Jim Heppelmann, PTC experienced significant improvement in both operating margin and free cash flow growth, while repositioning our solutions portfolio to focus on smart, connected products. I expect the focus on delivering value to our shareholders via improving financials and strategic growth will continue under the leadership of Jim and the rest of PTC’s management team.”
Q1 FY’15 Earnings Conference Call and Webcast
Prepared
remarks for the conference call (which include supplemental financial
and statistical information) have been posted to the Investor Relations
section of our website.
The prepared remarks will not be read live; the call will be primarily Q&A.
| What: | PTC Fiscal Q1’15 Conference Call and Webcast | |
| When: | Thursday, January 29, 2015 at 8:30am (ET) | |
| Dial-in: |
1-800-857-5592 or 1-773-799-3757
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| Webcast: | ||
| Replay: |
The audio replay of this event will be archived for public replay
until 5:00 pm (CT) on February 9, 2015.
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Important Information About Non-GAAP References
PTC
provides non-GAAP supplemental information to its financial results.
Non-GAAP revenue, operating expenses, margin and EPS exclude the effect
of purchase accounting on the fair value of acquired deferred revenue,
stock-based compensation expense, amortization of acquired intangible
assets, restructuring charges, acquisition-related expenses, costs
associated with terminating a U.S. pension plan, certain identified
non-operating gains and losses, and the related tax effects of the
preceding items and discrete tax items. We use these non-GAAP measures,
and we believe that they assist our investors, to make period-to-period
comparisons of our operational performance because they provide a view
of our operating results without items that are not, in our view,
indicative of our core operating results. We believe that these non-GAAP
measures help illustrate underlying trends in our business, and we use
the measures to establish budgets and operational goals, communicated
internally and externally, for managing our business and evaluating our
performance. We believe that providing non-GAAP measures affords
investors a view of our operating results that may be more easily
compared to the results of peer companies. In addition, compensation of
our executives is based in part on the performance of our business based
on these non-GAAP measures. However, non-GAAP information should not be
construed as an alternative to GAAP information as the items excluded
from the non-GAAP measures often have a material impact on PTC’s
financial results. Management uses, and investors should consider,
non-GAAP measures in conjunction with our GAAP results. PTC also
provides results on a constant currency basis to provide a
year-over-year view of our results excluding the effect of currency
translation. Our constant currency disclosures are calculated by
multiplying the actual results for the first quarter of 2015 by the
exchange rates in effect for the comparable period in the prior year.
Forward-Looking Statements
Statements
in this press release that are not historic facts, including statements
about our fiscal 2015 and other future financial and growth expectations
and anticipated tax rates, are forward-looking statements that involve
risks and uncertainties that could cause actual results to differ
materially from those projected. These risks include the possibility
that the macroeconomic and/or global manufacturing climates may not
improve or may deteriorate, the possibility that customers may not
purchase or adopt our solutions when or at the rates we expect and that
our pipeline deals may not convert as we expect, the possibility that
our businesses, including the Internet of Things (IoT) and SLM
businesses, may not expand and/or generate the revenue we expect, the
possibility that foreign currency exchange rates may vary from our
expectations and thereby affect our reported revenue and expense, the
possibility that we may not achieve the license and subscription
solutions (L&SS), support and professional services growth rates that we
expect, which could result in a different mix of revenue between L&SS,
support and professional services and could impact our EPS results, the
possibility that customers may purchase more of our solutions as
subscriptions, which would adversely affect near-term revenue, operating
margins, and EPS, the possibility that sales of our solutions as
subscriptions may not have the longer-term effect on revenue that we
expect, the possibility that we may be unable to improve services
margins as we expect, the possibility that we may not generate
sufficient operating cash flow to repurchase our shares as we plan or
that other uses of cash may preclude such repurchases; the possibility
that we may incur additional acquisition-related and pension plan
termination-related expenses and losses than we expect, and the
possibility that fines and penalties may be assessed against us in
connection with our previously announced investigation in China . In
addition, our assumptions concerning our future GAAP and non-GAAP
effective income tax rates are based on estimates and other factors that
could change, including the geographic mix of our revenue, expenses and
profits and loans and cash repatriations from foreign subsidiaries.
Other risks and uncertainties that could cause actual results to differ
materially from those projected are detailed from time to time in
reports we file with the Securities and Exchange Commission, including
our most recent Annual Report on Form 10-K.
PTC, the PTC logo, ThingWorx, Axeda, Creo, Servigistics, and all other PTC product names and logos are trademarks or registered trademarks of PTC Inc. or its subsidiaries in the United States and in other countries. All other companies referenced herein are trademarks or registered trademarks of their respective holders.
About PTC
PTC
(Nasdaq: PTC) enables manufacturers to achieve sustained product and
service advantage. PTC’s technology solutions help customers transform
the way they create, operate and service products for a smart,
connected, world. Founded in 1985, PTC employs approximately 6,000
professionals serving more than 28,000 businesses in rapidly-evolving,
globally distributed manufacturing industries worldwide. Get more
information at www.ptc.com.
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PTC Inc. UNAUDITED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) |
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| Three Months Ended | ||||||||||||
|
January 3, |
December 28, 2013 |
|||||||||||
| Revenue: |
|
|||||||||||
| License and subscription solutions (L&SS) | $ | 78,971 | $ | 82,866 | ||||||||
| Support | 181,629 | 170,142 | ||||||||||
| Professional services | 64,842 | 71,917 | ||||||||||
| Total revenue | 325,442 | 324,925 | ||||||||||
| Cost of revenue: | ||||||||||||
| Cost of L&SS revenue (1) | 13,329 | 10,319 | ||||||||||
| Cost of support revenue (1) | 21,396 | 19,916 | ||||||||||
| Cost of professional services revenue (1) | 58,217 | 62,721 | ||||||||||
| Total cost of revenue | 92,942 | 92,956 | ||||||||||
| Gross margin | 232,500 | 231,969 | ||||||||||
| Operating expenses: | ||||||||||||
| Sales and marketing (1) | 87,607 | 84,238 | ||||||||||
| Research and development (1) | 61,097 | 53,073 | ||||||||||
| General and administrative (1) | 37,007 | 30,931 | ||||||||||
| Amortization of acquired intangible assets | 9,413 | 7,789 | ||||||||||
| Restructuring charges | (255 | ) | 1,067 | |||||||||
| Total operating expenses | 194,869 | 177,098 | ||||||||||
| Operating income | 37,631 | 54,871 | ||||||||||
| Other income (expense), net | (3,224 | ) | (1,753 | ) | ||||||||
| Income before income taxes | 34,407 | 53,118 | ||||||||||
| Provision (benefit) for income taxes | 4,123 | 13,461 | ||||||||||
| Net income | $ | 30,284 | $ | 39,657 | ||||||||
| Earnings per share: | ||||||||||||
| Basic | $ | 0.26 | $ | 0.33 | ||||||||
| Weighted average shares outstanding | 115,341 | 118,933 | ||||||||||
| Diluted | $ | 0.26 | $ | 0.33 | ||||||||
| Weighted average shares outstanding | 117,027 | 121,100 | ||||||||||
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(1) The amounts in the tables above include stock-based compensation as follows: |
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| Three Months Ended | ||||||||||||
|
January 3, 2015 |
December 28, 2013 |
|||||||||||
| Cost of L&SS revenue | $ | 142 | $ | 65 | ||||||||
| Cost of support revenue | 776 | 924 | ||||||||||
| Cost of service revenue | 1,689 | 1,537 | ||||||||||
| Sales and marketing | 2,872 | 2,499 | ||||||||||
| Research and development | 3,086 | 2,689 | ||||||||||
| General and administrative | 2,677 | 5,050 | ||||||||||
| Total stock-based compensation | $ | 11,242 | $ | 12,764 | ||||||||
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PTC Inc. NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (UNAUDITED) (in thousands, except per share data) |
|||||||||||||
| Three Months Ended | |||||||||||||
|
January 3, 2015 |
December 28, 2013 |
||||||||||||
| GAAP revenue | $ | 325,442 | $ | 324,925 | |||||||||
| Fair value adjustment of acquired deferred L&SS revenue | 682 | - | |||||||||||
| Fair value adjustment of acquired deferred support revenue | 465 | - | |||||||||||
| Fair value adjustment of acquired deferred service revenue | 257 | - | |||||||||||
| Non-GAAP revenue | $ | 326,846 | $ | 324,925 | |||||||||
| GAAP gross margin | $ | 232,500 | $ | 231,969 | |||||||||
| Fair value adjustment of acquired deferred L&SS revenue | 682 | - | |||||||||||
| Fair value adjustment of acquired deferred support revenue | 465 | - | |||||||||||
| Fair value adjustment of acquired deferred service revenue | 257 | - | |||||||||||
| Fair value adjustment to deferred services cost | (106 | ) | - | ||||||||||
| Stock-based compensation | 2,607 | 2,526 | |||||||||||
| Amortization of acquired intangible assets | |||||||||||||
| included in cost of L&SS revenue | 4,767 | 4,497 | |||||||||||
| Non-GAAP gross margin | $ | 241,172 | $ | 238,992 | |||||||||
| GAAP operating income | $ | 37,631 | $ | 54,871 | |||||||||
| Fair value adjustment of acquired deferred L&SS revenue | 682 | - | |||||||||||
| Fair value adjustment of acquired deferred support revenue | 465 | - | |||||||||||
| Fair value adjustment of acquired deferred service revenue | 257 | - | |||||||||||
| Fair value adjustment to deferred services cost | (106 | ) | - | ||||||||||
| Stock-based compensation | 11,242 | 12,764 | |||||||||||
| Amortization of acquired intangible assets | |||||||||||||
| included in cost of license revenue | 4,767 | 4,497 | |||||||||||
| Amortization of acquired intangible assets | 9,413 | 7,789 | |||||||||||
| Charges included in general and administrative expenses (3) | 5,717 | 1,305 | |||||||||||
| Restructuring charges | (255 | ) | 1,067 | ||||||||||
| Non-GAAP operating income (2) | $ | 69,813 | $ | 82,293 | |||||||||
| GAAP net income | $ | 30,284 | $ | 39,657 | |||||||||
| Fair value adjustment of acquired deferred L&SS revenue | 682 | - | |||||||||||
| Fair value adjustment of acquired deferred support revenue | 465 | - | |||||||||||
| Fair value adjustment of acquired deferred service revenue | 257 | - | |||||||||||
| Fair value adjustment to deferred services cost | (106 | ) | - | ||||||||||
| Stock-based compensation | 11,242 | 12,764 | |||||||||||
| Amortization of acquired intangible assets | |||||||||||||
| included in cost of license revenue | 4,767 | 4,497 | |||||||||||
| Amortization of acquired intangible assets | 9,413 | 7,789 | |||||||||||
| Charges included in general and administrative expenses (3) | 5,717 | 1,305 | |||||||||||
| Restructuring charges | (255 | ) | 1,067 | ||||||||||
|
Income tax adjustments (4) |
(3,486 | ) | (6,858 | ) | |||||||||
| Non-GAAP net income | $ | 58,980 | $ | 60,221 | |||||||||
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PTC Inc. |
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| Three Months Ended | |||||||||||||
|
January 3, 2015 |
December 28, 2013 |
||||||||||||
| GAAP diluted earnings per share | $ | 0.26 | $ | 0.33 | |||||||||
| Fair value adjustment of acquired deferred revenue | 0.01 | - | |||||||||||
| Fair value adjustment to deferred costs | - | - | |||||||||||
| Stock-based compensation | 0.10 | 0.11 | |||||||||||
| Amortization of acquired intangibles | 0.12 | 0.10 | |||||||||||
| Charges included in general and administrative expenses (3) | 0.05 | 0.01 | |||||||||||
| Restructuring charges | - | 0.01 | |||||||||||
| Income tax adjustments (4) | (0.03 | ) | (0.06 | ) | |||||||||
| Non-GAAP diluted earnings per share | $ | 0.50 | $ | 0.50 | |||||||||
| (2)Operating margin impact of non-GAAP adjustments: | |||||||||||||
| Three Months Ended | |||||||||||||
|
January 3, 2015 |
December 28, 2013 |
||||||||||||
| GAAP operating margin | 11.6 | % | 16.9 | % | |||||||||
| Fair value adjustment of acquired deferred revenue | 0.4 | % | 0.0 | % | |||||||||
| Fair value adjustment to deferred costs | 0.0 | % | 0.0 | % | |||||||||
| Stock-based compensation | 3.5 | % | 3.9 | % | |||||||||
| Amortization of acquired intangibles | 4.4 | % | 3.8 | % | |||||||||
| Charges included in general and administrative expenses (3) | 1.8 | % | 0.4 | % | |||||||||
| Restructuring charges | -0.1 | % | 0.3 | % | |||||||||
| Non-GAAP operating margin | 21.4 | % | 25.3 | % | |||||||||
(3)Represents acquisition-related charges, as well as,
expense related to a terminating U.S. pension plan of $1.7 million in
the three months ended January 3, 2015.
(4)Income tax
adjustments for the three months ended January 3, 2015 and December 28,
2013 reflect the tax effects of non-GAAP adjustments which are
calculated by applying the applicable tax rate by jurisdiction to the
non-GAAP adjustments listed above, and also include any identified tax
items. In the fourth quarter of 2012, a valuation allowance was
established against our U.S. net deferred tax assets. Similarly, in the
fourth quarter of 2014, valuation allowances were established against
our foreign net deferred tax assets in two foreign jurisdictions. As the
U.S. and the two foreign jurisdictions are profitable on a non-GAAP
basis, the 2015 and 2014 non-GAAP tax provisions are being calculated
assuming there is no valuation allowance in these jurisdictions.
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PTC Inc.
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|
January 3, 2015 |
September 30, |
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ASSETS |
||||||||
| Cash and cash equivalents | $ | 261,052 | $ | 293,654 | ||||
| Accounts receivable, net | 201,391 | 235,688 | ||||||
| Property and equipment, net | 65,766 | 67,783 | ||||||
| Goodwill and acquired intangible assets, net | 1,320,013 | 1,349,400 | ||||||
| Other assets | 289,001 | 253,429 | ||||||
| Total assets | $ | 2,137,223 | $ | 2,199,954 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Deferred revenue | $ | 397,620 | $ | 382,544 | ||||
| Borrowings under credit facility | 605,625 | 611,875 | ||||||
| Other liabilities | 278,525 | 351,646 | ||||||
| Stockholders' equity | 855,453 | 853,889 | ||||||
| Total liabilities and stockholders' equity | $ | 2,137,223 | $ | 2,199,954 | ||||
|
PTC Inc. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) |
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| Three Months Ended | |||||||||||
|
January 3, 2015 |
December 28, 2013 |
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| Cash flows from operating activities: | |||||||||||
| Net income | $ | 30,284 | $ | 39,657 | |||||||
| Stock-based compensation | 11,242 | 12,764 | |||||||||
| Depreciation and amortization | 21,237 | 19,100 | |||||||||
| Accounts receivable | 25,800 | 19,273 | |||||||||
| Accounts payable and accruals | (53,229 | ) | (42,862 | ) | |||||||
| Deferred revenue | (8,776 | ) | (10,827 | ) | |||||||
| Income taxes | (2,953 | ) | 7,393 | ||||||||
| Excess tax benefits from stock-based awards | 163 | (6,802 | ) | ||||||||
| Other | (12,121 | ) | (1,454 | ) | |||||||
|
Net cash provided by operating activities (5) |
11,647 | 36,242 | |||||||||
| Capital expenditures | (5,636 | ) | (5,774 | ) | |||||||
| Acquisitions of businesses, net of cash acquired | 180 | - | |||||||||
| Proceeds (payments) on debt, net | (6,250 | ) | 110,000 | ||||||||
| Proceeds from issuance of common stock | 3 | 351 | |||||||||
| Payments of withholding taxes in connection with | |||||||||||
| vesting of stock-based awards | (21,669 | ) | (19,363 | ) | |||||||
| Excess tax benefits from stock-based awards | (163 | ) | 6,802 | ||||||||
| Other financing & investing activities | (1,000 | ) | - | ||||||||
| Foreign exchange impact on cash | (9,714 | ) | 1,206 | ||||||||
| Net change in cash and cash equivalents | (32,602 | ) | 129,464 | ||||||||
| Cash and cash equivalents, beginning of period | 293,654 | 241,913 | |||||||||
| Cash and cash equivalents, end of period | $ | 261,052 | $ | 371,377 | |||||||
(5)The quarter ended January 3, 2015 includes $10 million of voluntary contribution funding payments to a non-U.S. pension plan.