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Filed Pursuant to Rule 424(b)(3) and Rule 424(c)
Registration No. 333-80851
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED AUGUST 12, 1999)
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PROSPECTUS SUPPLEMENT
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1,868,480 Shares
VERITAS SOFTWARE CORPORATION
Common Stock
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This prospectus supplement relates to the offering of VERITAS Software
Corporation common stock in exchange for exchangeable shares of TeleBackup
Exchangeco, Inc., as described on pages 91 to 93 of the prospectus dated August
12, 1999, as supplemented April 27, 2000 and May 15, 2000 (the "Prospectus"), to
which this prospectus supplement is attached.
This prospectus supplement should be read in conjunction with the
Prospectus, which is to be delivered with this prospectus supplement. This
prospectus supplement is qualified by reference to the Prospectus except to the
extent that the information in this prospectus supplement supersedes the
information contained in the Prospectus. All capitalized terms used but not
defined in this prospectus supplement have the meanings given to them in the
Prospectus.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SHARES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE PROSPECTUS OR THIS PROSPECTUS SUPPLEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus supplement is July 19, 2000.
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FINANCIAL RESULTS
On July 18, 2000, we announced financial results for our second quarter
ended June 30, 2000.
We achieved second quarter revenue of $275.4 million, an increase of 77%
over last year's pro forma second quarter revenue of $155.7 million. Pro forma
net income, which excludes purchase accounting adjustments, increased to $57.2
million in the second quarter from $29.3 million for the same period prior year,
a 95% increase. Diluted pro forma net income per share for the second quarter
was $0.13, an 86% increase from $0.07 for the same period last year. Our pro
forma operating margin increased to 31% for the second quarter, up over two
points from last year's second quarter results.
Our as-reported revenue for the second quarter was $275.4 million, up over
140% compared with $114.6 million for the same period last year. For the second
quarter, we reported a net loss of $172.3 million, or $0.43 per share, compared
with a net loss of $162.3 million, or $0.59 per share on a diluted basis for the
prior year. Included in the current period's net loss is $235.3 million of
purchase accounting amortization. Included in the prior period's net loss are
one-time charges of $103.1 million for the write-off of in-process research and
development, $11.0 million for merger and restructuring and $76.6 million of
purchase accounting amortization.
On a pro forma basis for the six-month period ended June 30, 2000 and 1999,
we had revenue of $520.1 million and $290.5 million, respectively, a 79%
year-over-year increase. Net income increased to $108.9 million from pro forma
net income of $57.1 million in the prior period, a 91% increase. Pro forma
diluted net income per share was $0.25, compared with $0.14 for the same period
last year, a 79% increase.
Our as-reported revenue for the six-month period ended June 30, 2000 was
$520.1 million, compared with $186.6 million for the same period last year. For
the six-month period, we reported a net loss of $346.7 million, or $0.87 per
share, compared with a net loss of $148.7 million, or $0.61 per share for the
same period in the prior year.
To better facilitate financial reporting, we added the following financial
table to our earnings release: "Pro forma Statements of Operations." These pro
forma statements are intended to present our operating results excluding
purchase accounting adjustments. For 1999, our operating results include the
results of Seagate Software NSMG and TeleBackup Systems effective at the
beginning of the period.
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VERITAS SOFTWARE CORPORATION
PRO FORMA STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
-------------------- --------------------
2000 1999 2000 1999
-------- -------- -------- --------
<S> <C> <C> <C> <C>
NET REVENUE:
User license fees........................ $224,851 $132,510 $429,167 $248,076
Services................................. 50,585 23,228 90,909 42,391
-------- -------- -------- --------
Total net revenue..................... 275,436 155,738 520,076 290,467
COST OF REVENUE:
User license fees........................ 8,199 5,043 19,977 10,420
Services................................. 20,165 8,737 38,464 16,226
-------- -------- -------- --------
Total cost of revenue................. 28,364 13,780 58,441 26,646
-------- -------- -------- --------
Gross profit............................... 247,072 141,958 461,635 263,821
OPERATING EXPENSES:
Selling and marketing.................... 106,109 60,694 193,692 110,495
Research and development................. 39,205 26,544 74,318 49,428
General and administrative............... 17,595 10,809 32,506 19,476
-------- -------- -------- --------
Total operating expenses.............. 162,909 98,047 300,516 179,399
-------- -------- -------- --------
Income from operations..................... 84,163 43,911 161,119 84,422
Interest and other income, net............. 12,777 3,332 24,040 7,574
Interest expense........................... (7,525) (1,409) (15,048) (2,847)
-------- -------- -------- --------
Income before income taxes................. 89,415 45,834 170,111 89,149
Provision for income taxes................. 32,189 16,500 61,240 32,094
-------- -------- -------- --------
Pro forma net income....................... $ 57,226 $ 29,334 $108,871 $ 57,055
======== ======== ======== ========
Pro forma net income per share -- basic.... $ 0.14 $ 0.08 $ 0.27 $ 0.15
======== ======== ======== ========
Pro forma net income per share --diluted... $ 0.13 $ 0.07 $ 0.25 $ 0.14
======== ======== ======== ========
Shares used in per share
calculation -- basic..................... 400,787 380,097 397,645 372,334
======== ======== ======== ========
Shares used in per share
calculation -- diluted................... 437,653 414,254 437,457 403,436
======== ======== ======== ========
</TABLE>
The pro forma statements of operations are intended to present the Company's
operating results excluding purchase accounting adjustments. For 1999, the
Company's operating results include the results of NSMG and TeleBackup assuming
the companies had been combined at the beginning of the period.
Purchase accounting adjustments would include amortization of developed
technology, amortization of goodwill and intangibles, restructuring and other
merger costs, in-process research and development costs, and related adjustments
for income tax provisions.
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VERITAS SOFTWARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
---------------------- ----------------------
2000 1999 2000 1999
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
NET REVENUE:
User license fees.................... $ 224,851 $ 93,296 $ 429,167 $ 149,082
Services............................. 50,585 21,352 90,909 37,470
--------- --------- --------- ---------
Total net revenue................. 275,436 114,648 520,076 186,552
COST OF REVENUE:
User license fees.................... 8,199 2,827 19,977 4,782
Services............................. 20,165 8,254 38,464 14,781
Amortization of developed
technology........................ 15,553 5,006 30,948 5,006
--------- --------- --------- ---------
Total cost of revenue............. 43,917 16,087 89,389 24,569
--------- --------- --------- ---------
Gross profit........................... 231,519 98,561 430,687 161,983
OPERATING EXPENSES:
Selling and marketing................ 106,109 44,572 193,692 71,395
Research and development............. 39,205 20,550 74,318 34,366
General and administrative........... 17,595 7,122 32,506 10,411
Amortization of goodwill and other
intangibles....................... 219,758 71,557 439,517 71,557
In-Process research and
development....................... -- 103,100 -- 103,100
Acquisition and restructuring
costs............................. -- 11,000 -- 11,000
--------- --------- --------- ---------
Total operating expenses.......... 382,667 257,901 740,033 301,829
--------- --------- --------- ---------
Income (loss) from operations.......... (151,148) (159,340) (309,346) (139,846)
Interest and other income, net......... 12,777 3,148 24,040 6,179
Interest expense....................... (7,525) (1,409) (15,048) (2,842)
--------- --------- --------- ---------
Income (loss) before income taxes...... (145,896) (157,601) (300,354) (136,509)
Provision for income taxes............. 26,445 4,728 46,370 12,237
--------- --------- --------- ---------
Net income (loss)...................... $(172,341) $(162,329) $(346,724) $(148,746)
========= ========= ========= =========
Net income (loss) per share -- basic... $ (0.43) $ (0.59) $ (0.87) $ (0.61)
========= ========= ========= =========
Net income (loss) per
share -- diluted..................... $ (0.43) $ (0.59) $ (0.87) $ (0.61)
========= ========= ========= =========
Shares used in per share
calculation -- basic................. 400,787 275,467 397,645 245,493
========= ========= ========= =========
Shares used in per share calculation --
diluted.............................. 400,787 275,467 397,645 245,493
========= ========= ========= =========
</TABLE>
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VERITAS SOFTWARE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
----------- ------------
(UNAUDITED)
<S> <C> <C>
ASSETS
Current assets:
Cash and short-term investments........................... $ 944,568 $ 692,381
Accounts receivable, net.................................. 138,545 132,180
Deferred income taxes..................................... 23,803 23,803
Other current assets...................................... 16,024 13,381
---------- ----------
Total current assets................................... 1,122,940 861,745
Long-term investments....................................... 56,138 65,036
Property and equipment...................................... 106,525 76,958
Goodwill and other intangibles.............................. 2,757,674 3,226,749
Other non-current assets.................................... 34,267 2,789
---------- ----------
Total assets........................................... $4,077,544 $4,233,277
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 37,108 $ 30,229
Accrued compensation and benefits......................... 52,181 35,560
Accrued acquisition and restructuring costs............... 19,903 24,202
Other accrued liabilities................................. 48,530 47,531
Income taxes payable...................................... 322 6,804
Deferred revenue.......................................... 126,119 86,979
---------- ----------
Total current liabilities.............................. 284,163 231,305
Non-current liabilities:
Convertible subordinated notes............................ 456,587 451,044
Deferred income taxes..................................... 136,834 157,867
---------- ----------
Total non-current liabilities.......................... 593,421 608,911
Stockholders' equity........................................ 3,199,960 3,393,061
---------- ----------
Total liabilities and stockholders' equity............. $4,077,544 $4,233,277
========== ==========
</TABLE>
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