CIMdata PLM Industry Summary Online Archive

27 April 2005

Financial News

PTC Reports Second Quarter Fiscal Year 2005 Results; Company Focus on Customer Success Fuels Revenue Growth

PTC reported revenue of $176.1 million for the second fiscal quarter ended April 2, 2005, up 7% from $164.7 million for the same period last year. The growth was driven primarily by strength in sales of PTC's collaboration and control solutions, as well as consulting services offerings.

Net income for the second quarter was $20.5 million, or $0.07 per diluted share, compared with net income of $3.2 million, or $0.01 per diluted share, in the year-ago period. The year-ago period net income included restructuring charges of $16.7 million. Cash and cash equivalents grew to $384.2 million at the end of the second quarter from $334.1 million at the end of the first quarter of 2005.

"We continue to deliver meaningful growth across our business and exceed our own targets," said C. Richard Harrison, president and chief executive officer. "We attribute our success to solid and patient execution of our business strategy. Our ability to help customers create innovative products across a globally distributed development environment differentiates PTC's offerings from others in the industry. It has helped drive sales of our software, as well as services offerings focused on unlocking the value of our technology and product development expertise."

Total revenue for design solutions in the second quarter was $124.8 million, up 2% from the second quarter of 2004. Design solutions license revenue of $34.8 million declined 9% year over year due to a decline in revenue from large transactions; however, design solutions license sales showed 7% sequential growth. Pro/ENGINEER® WildfireT continues to gain traction in the market with higher year-over-year sales of its entry-level and mid-range packages. Additionally, design solutions consulting and training services revenue grew 16% year over year, reflecting higher sales of offerings that help improve user proficiency and engineering productivity.

Total revenue for collaboration and control solutions in the second quarter was $51.3 million, up 23% from the second quarter of 2004. Collaboration and control solutions license revenue of $17.9 million grew 38% year over year and 24% sequentially. Sales were driven by significant growth in new seats to both existing and new customers. Windchill® Link solutions license revenue grew 24% year over year. Additionally, collaboration and control solutions consulting and training services revenue grew 13% year over year as PTC helped customers adopt its technology and improve their product development processes.

In the second quarter, PTC received orders from leading organizations including Boeing Company, ENI SpA, Exostar, Hino Motors, Ltd., Lockheed Martin Corporation, Mitsubishi Heavy Industries, Ltd., Schneider Electric Industries, Tata Motors Ltd., Sanyo Epson Imaging Devices Corp., Thales, TRW, and the U.S. Army. Additionally, PTC's reseller channel delivered $34.7 million in total revenue during the quarter, an 8% year-over-year increase.

"Our outlook is bright as we execute our long-term growth strategy," continued Harrison. "We will maintain our strong focus on driving customer success and delivering highly differentiated product and service offerings to the market. We will expand our capabilities by investing in a combination of R&D initiatives, sales and services delivery capacity, strategic partnerships and corporate development activities. In this way, we plan to reach our targets of $1 billion in revenue and 20% operating margins by fiscal 2008."

Third Quarter and Fiscal 2005 Financial Outlook

PTC's revenue forecast for the third quarter of fiscal 2005 is between $175 million and $180 million. Total third quarter costs and expenses (operating expenses) are expected to be between $150 million and $155 million. The Company expects third quarter earnings per share on a GAAP basis to be between $0.06 and $0.08. For the fiscal year ending September 30, 2005, PTC expects revenue to be between $700 million and $710 million. Total costs and expenses (operating expenses) are expected to be between $600 million and $610 million for the fiscal year. The Company expects earnings per share on a GAAP basis to be between $0.26 and $0.30 for the fiscal year. The earnings per share outlook does not include any potential impact from expensing or granting equity-based awards to employees.

The Company will provide detailed financial information and an outlook update on its second quarter fiscal year 2005 results conference call and live webcast on April 27, 2005 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 . A replay of the call will be available until 5:00 p.m. ET on May 2, 2005. To access the replay via webcast, please visit http://www.ptc.com/for/investors.htm . To access the replay by phone, please dial 402-280-1615.

 

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