CIMdata PLM Industry Summary Online Archive

26 July 2012

Financial News

PTC Announces Solid Q3 Results, Increases FY’12 EPS Guidance

PTC today reported results for its third fiscal quarter ended June 30, 2012.

Highlights

  • Q3 Results:
    • Non-GAAP revenue of $311.2 million, up 6% year over year (10% on a constant currency basis)
    • Non-GAAP EPS of $0.37, up 16% year over year (24% on a constant currency basis)
    • GAAP revenue of $311.0 million and GAAP EPS of $0.19, including a $4.1 million restructuring charge
    • Revenue contribution from MKS (acquired on May 31, 2011) and 4CS Solutions (acquired on September 2, 2011) was $20.5 million on a non-GAAP basis and $20.3 million on a GAAP basis
    • Non-GAAP operating margin of 18.6%; GAAP operating margin of 10.0%
    • Relative to Q3 guidance assumptions, currency had no material effect on reported results
  • Q4 Guidance:
    • Revenue of $320 to $335 million and non-GAAP EPS of $0.44 to $0.50
    • License revenue of $100 to $115 million
    • Revenue guidance assumes $1.20 USD / EURO, down from previous assumption of $1.30; an approximate $10 million negative impact to Q4 revenue guidance ($3 to $4 million license revenue impact)
    • Approximate $1 million quarterly expense benefit from restructuring in Q3’12
    • GAAP EPS of $0.33 to $0.39
  • FY’12 Targets:
    • Updated targets primarily reflect the impact of currency relative to previous guidance assumptions
    • Non-GAAP revenue of $1,255 to $1,270 million and non-GAAP EPS of $1.46 to $1.52
    • License revenue of approximately $355 million
    • Non-GAAP operating margin of approximately 19.5%
    • GAAP revenue of $1,252 to $1,267 million and GAAP EPS of $0.73 to $0.80, including a $24.9 million restructuring charge, and GAAP operating margin of approximately 10.0%.

The Q3 non-GAAP revenue results exclude a $0.2 million effect of purchase accounting on the fair value of the acquired deferred maintenance balance of MKS Inc. The Q3 non-GAAP EPS results also exclude $13.3 million of stock-based compensation expense, $9.0 million of acquisition-related intangible asset amortization, $4.1 million of restructuring charges, and $5.3 million of income tax adjustments. The Q3 results include a non-GAAP tax rate of 23%, a GAAP tax rate of 26% and 121 million diluted shares outstanding.

Results Commentary

James Heppelmann, president and chief executive officer, commented, “PTC delivered solid operating results, with Q3 non-GAAP revenue toward the higher end of our guidance range and non-GAAP EPS exceeding the high end of our guidance range. Our license revenue of $83.8 million was up 7% year over year on a constant currency basis. Organic license revenue increased 1% year over year on a constant currency basis reflecting very strong comparable results in Q3’11 – particularly in our MCAD business. From a geographic perspective, Europe continued to perform in line with our expectations and the Pac Rim and Japan delivered strong results. While Americas performance lagged other geographies in Q3, our pipeline continues to build and we are optimistic about the outlook for this region in Q4’12.” Reported license revenue was up 3% year over year and reported organic license revenue was down 3% year over year.

Heppelmann added, “We had 34 large deals (recognition of license + services revenue of more than $1 million from a single customer) in Q3’12, compared to 25 in Q2’12. We believe this is an indicator of the strength of our pipeline for business opportunities with new and existing customers. During the quarter we recognized revenue from leading organizations such as FAW Group, Jenoptick, KTM-Sportmotorcycle AG, Levi Strauss, Samsung, Stryker, US Navy and Volvo.”

Heppelmann continued, “We are excited about the market momentum we are seeing and remain committed to driving margin expansion. In spite of weaker macroeconomic conditions and currency headwinds (currency alone could negatively impact FY’13 revenues by approximately $40 million) we are targeting FY’13 non-GAAP EPS of $1.70 to $1.80.” We will provide formal FY’13 guidance in conjunction with our Q4 results in October.

Jeff Glidden, chief financial officer, commented, “From a profitability standpoint, Q3 was another solid quarter with a good mix of revenue, strong services margins, and lower operating expenses as we remained disciplined on hiring and spending. We delivered $0.37 non-GAAP EPS, an increase of 16% from $0.32 non-GAAP EPS in Q3’11. We ended Q3’12 with $238 million of cash up from $224 million at the end of Q2’12, reflecting strong operating cash flow, offset by $20 million used to repay our revolving credit facility and $20 million for stock repurchases.”

Q3 Earnings Conference Call and Webcast

Prepared remarks for the conference call 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 Q3 Conference Call and Webcast

When:

Thursday, July 26th, 2012 at 8:30 am (ET)

Dial-in:

1-800-857-5592 or 1-773-799-3757

Call Leader: James Heppelmann

Passcode: PTC

Webcast:

www.ptc.com/for/investors.htm

Replay:

The audio replay of this event will be archived for public replay until 4:00 pm (CT) on August 6, 2012 at 1-866-393-0874. To access the replay via webcast, please visit www.ptc.com/for/investors.htm.

To view an unabridged version of this press release, visit: http://www.businesswire.com/news/home/20120725006741/en/PTC-Announces-Solid-Q3-Results-Increases-FY%E2%80%9912

 

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