Autodesk First Quarter Earnings Per Share Increase 72 Percent; Raises Guidance for Second Quarter and Fiscal Year

CIMdata PLM Industry Summary Online Archive

19 May 2005

Financial News

Autodesk First Quarter Earnings Per Share Increase 72 Percent; Raises Guidance for Second Quarter and Fiscal Year

Autodesk, Inc. announced financial results for its first fiscal quarter ended April 30, 2005. For the first quarter, Autodesk reported net revenues of $355 million, a 19 percent increase over $298 million reported in the first quarter of the prior year.

First quarter net income was $76 million, or $0.31 per diluted share, on a GAAP basis and $75 million, or $0.30 per diluted share on a non-GAAP basis. Non-GAAP net income excludes a $1 million benefit related to the successful resolution of tax audits for a prior year. Net income in the first quarter of the prior year was $43 million, or $0.18 per diluted share, on a GAAP basis, and $51 million, or $0.22 per diluted share on a non-GAAP basis.

"Autodesk had another outstanding quarter," said Carol Bartz, Autodesk chairman and CEO. "In March, we launched the strongest product portfolio in the company's history, which included more than 25 products. Our customers are interested in quick implementation, ease of use and fast return on investment. Our results demonstrate that Autodesk is meeting those needs."

Autodesk's performance was driven by strong growth in revenues from new seats and subscriptions, increasing penetration of its vertical and 3D products and continued improvement in profitability.

First quarter revenues from new seats increased 22 percent over the prior year. Revenues from new seats of AutoCAD increased 26 percent over the prior year.

Combined revenues from subscriptions and upgrades increased 19 percent over the first quarter of fiscal 2005. Consistent with company strategy, subscription revenues, which are called maintenance in the financial statements, increased 57 percent over last year. Combined revenues from subscriptions and upgrades continue to represent approximately one-third of total revenues.

The company's vertical and 3D products continue to increase their market penetration. In the first quarter, revenues from Autodesk Map® 3D increased 25 percent over the prior year. Combined revenues from AutoCAD® Mechanical and AutoCAD® Electrical software increased 53 percent over last year. Revenues from new commercial seats of Autodesk® Inventor® Series, Autodesk Inventor Professional, Autodesk® Revit® Building, Autodesk AutoCAD® Revit® Series, and Autodesk Civil 3DT software, increased 83 percent over the prior year.

During the quarter Autodesk continued to improve its profitability. Operating margins increased to 26 percent on a GAAP and non-GAAP basis. Operating margins in the first quarter of fiscal 2005 were 18 percent on a GAAP basis and 21 percent on a non-GAAP basis.

"I have never been more confident of our future opportunities," said Bartz. "We have already introduced outstanding new versions of our product portfolio. Our refreshed product line and our commitment to continue to improve our productivity and efficiency position the company for strong growth. We've got the right strategy, the right products and the right people to continue to grow this company faster and more profitably than our competitors."

A reconciliation of the above non-GAAP operating margin, net income and EPS amounts to the corresponding GAAP amounts as well as financial tables is available at http://investors.autodesk.com/phoenix.zhtml?c=117861&p=irol-newsArticle&ID=711984&highlight =

Business Outlook

The following statements are forward looking statements which are based on current expectations and which involve risks and uncertainties some of which are set forth below.

Second Quarter Fiscal 2006

Net revenues for the second quarter of fiscal 2006 are currently expected to be in the range of $350 million to $360 million. Operating expenses are expected to increase in the second quarter due to increasing investments in growth initiatives. GAAP and non-GAAP earnings per diluted share are currently expected to be in the range of $0.22 to $0.24 per diluted share.

Full Year Fiscal 2006

For fiscal year 2006, net revenues are currently expected to be in the range of $1.45 billion to $1.5 billion. GAAP and non-GAAP earnings per diluted share are expected to be in the range of $1.14 to $1.19.

All fiscal 2006 EPS guidance ranges are based on the company's 20 percent estimated tax rate. The company currently believes that its effective tax rate will revert back to a 24 percent effective tax rate in fiscal year 2007.

Further information on potential factors that could affect the financial results of Autodesk are included in the company's report on Form 10-K for the year ended January 31, 2005 which is on file with the Securities and Exchange Commission.

Autodesk will host its first quarter earnings announcement today at 5:00 p.m. EDT. A replay of the call will be available at 4:00 p.m. PDT on our website at http://www.autodesk.com/investors or by dialing 888-286-8010 and reference 31289701 as the pass code. An audio webcast will also be available beginning at 5:00 p.m. EDT at http://www.autodesk.com/investors . A replay of this webcast will be maintained on our website for at least twelve months.

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