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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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VERITAS SOFTWARE CORPORATION
1,868,480 SHARES
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, May 15, 2000 and July 19, 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 October 13, 2000.
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FINANCIAL RESULTS
On October 12, 2000, we announced financial results for our third quarter
ended September 30, 2000.
We achieved third quarter revenue of $317.2 million, an increase of 73%
over last year's third quarter revenue of $183.4 million. Pro forma net income,
which excludes purchase accounting adjustments, increased to $70.3 million in
the third quarter from $38.9 million for the same period in the prior year, an
81% increase. Diluted pro forma net income per share for the third quarter was a
record $0.16, up 78% from $0.09 for the same period last year.
For the third quarter, on an as-reported basis, we reported a net loss of
$148.1 million, or $0.37 per share, compared with a net loss of $183.6 million,
or $0.48 per share 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 is $234.9 million of purchase accounting amortization and a
one-time charge of $1.1 million for the write-off of in-process research and
development.
On a pro forma basis for the nine-month periods ended September 30, 2000
and 1999, we had revenue of $837.2 million and $473.9 million, respectively, a
77% year-over-year increase. Net income increased to $179.2 million from pro
forma net income of $96.0 million in the prior period, an 87% increase. Pro
forma diluted net income per share was $0.41, compared with $0.23 for the same
period last year, a 78% increase.
Our as-reported revenue for the nine-month period ended September 30, 2000
was $837.2 million, compared with $370.0 million for the same period last year.
For the nine-month period, we reported a net loss of $494.8 million, or $1.24
per share, compared with a net loss of $332.3 million, or $1.14 per share for
the same period in the prior year.
We added an additional financial table to our earnings releases: "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 NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
---------------------- ----------------------
2000 1999 2000 1999
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
NET REVENUE:
User license fees .................................. $ 256,925 $ 157,643 $ 686,092 $ 405,719
Services ........................................... 60,246 25,758 151,155 68,149
--------- --------- --------- ---------
TOTAL NET REVENUE ............................... 317,171 183,401 837,247 473,868
COST OF REVENUE:
User license fees .................................. 9,270 5,891 29,247 16,311
Services ........................................... 21,707 10,787 60,171 27,013
--------- --------- --------- ---------
TOTAL COST OF REVENUE ........................... 30,977 16,678 89,418 43,324
--------- --------- --------- ---------
GROSS PROFIT ......................................... 286,194 166,723 747,829 430,544
OPERATING EXPENSES:
Selling and marketing .............................. 116,936 67,895 310,628 178,390
Research and development ........................... 46,328 28,924 120,646 78,352
General and administrative ......................... 20,465 11,020 52,971 30,496
--------- --------- --------- ---------
TOTAL OPERATING EXPENSES ........................ 183,729 107,839 484,245 287,238
--------- --------- --------- ---------
Income from operations ............................... 102,465 58,884 263,584 143,306
Interest and other income, net ....................... 15,648 7,266 39,688 14,840
Interest expense ..................................... (8,266) (5,301) (23,314) (8,148)
--------- --------- --------- ---------
Income before income taxes ........................... 109,847 60,849 279,958 149,998
Provision for income taxes ........................... 39,545 21,906 100,785 54,000
--------- --------- --------- ---------
PRO FORMA NET INCOME ................................. $ 70,302 $ 38,943 $ 179,173 $ 95,998
========= ========= ========= =========
PRO FORMA NET INCOME PER SHARE - BASIC ............... $ 0.17 $ 0.10 $ 0.45 $ 0.25
========= ========= ========= =========
PRO FORMA NET INCOME PER SHARE - DILUTED ............. $ 0.16 $ 0.09 $ 0.41 $ 0.23
========= ========= ========= =========
SHARES USED IN PER SHARE CALCULATION - BASIC ......... 403,613 384,847 399,655 380,864
========= ========= ========= =========
SHARES USED IN PER SHARE CALCULATION - DILUTED ....... 438,541 422,033 437,740 416,848
========= ========= ========= =========
</TABLE>
The pro forma statements of operations are intended to present our operating
results excluding purchase accounting adjustments. For 1999, our 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 NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------------- --------------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
NET REVENUE:
User license fees ............................... $ 256,925 $ 157,643 $ 686,092 $ 306,725
Services ........................................ 60,246 25,758 151,155 63,228
----------- ----------- ----------- -----------
TOTAL NET REVENUE ............................ 317,171 183,401 837,247 369,953
COST OF REVENUE:
User license fees ............................... 9,270 5,891 29,247 10,673
Services ........................................ 21,707 10,787 60,171 25,568
Amortization of developed technology ............ 15,553 15,258 46,501 20,264
----------- ----------- ----------- -----------
TOTAL COST OF REVENUE ........................ 46,530 31,936 135,919 56,505
----------- ----------- ----------- -----------
GROSS PROFIT ...................................... 270,641 151,465 701,328 313,448
OPERATING EXPENSES:
Selling and marketing ........................... 116,936 67,895 310,628 139,290
Research and development ........................ 46,328 28,924 120,646 63,290
General and administrative ...................... 20,465 11,020 52,971 21,431
Amortization of goodwill and other intangible ... 219,758 219,626 659,275 291,183
In-Process research and development ............. -- 1,100 -- 104,200
Acquisition and restructuring costs ............. -- -- -- 11,000
----------- ----------- ----------- -----------
TOTAL OPERATING EXPENSES ..................... 403,487 328,565 1,143,520 630,394
----------- ----------- ----------- -----------
Loss from operations .............................. (132,846) (177,100) (442,192) (316,946)
Interest and other income, net .................... 15,648 7,266 39,688 13,445
Interest expense .................................. (8,266) (5,301) (23,314) (8,143)
----------- ----------- ----------- -----------
Loss before income taxes .......................... (125,464) (175,135) (425,818) (311,644)
Provision for income taxes ........................ 22,642 8,441 69,012 20,678
----------- ----------- ----------- -----------
NET LOSS .......................................... $ (148,106) $ (183,576) $ (494,830) $ (332,322)
=========== =========== =========== ===========
NET LOSS PER SHARE - BASIC ........................ $ (0.37) $ (0.48) $ (1.24) $ (1.14)
=========== =========== =========== ===========
NET LOSS PER SHARE - DILUTED ...................... $ (0.37) $ (0.48) $ (1.24) $ (1.14)
=========== =========== =========== ===========
SHARES USED IN PER SHARE CALCULATION - BASIC ...... 403,613 384,847 399,655 292,115
=========== =========== =========== ===========
SHARES USED IN PER SHARE CALCULATION - DILUTED .... 403,613 384,847 399,655 292,115
=========== =========== =========== ===========
</TABLE>
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VERITAS SOFTWARE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
2000 1999
------------- -------------
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and short-term investments .................. $ 948,578 $ 692,381
Accounts receivable, net ......................... 169,115 132,180
Deferred income taxes ............................ 23,803 23,803
Other current assets ............................. 32,334 13,381
---------- ----------
TOTAL CURRENT ASSETS .......................... 1,173,830 861,745
Long-term investments .............................. 127,466 65,036
Property and equipment ............................. 130,163 76,958
Goodwill and other intangibles ..................... 2,521,759 3,226,749
Other non-current assets ........................... 45,513 2,789
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TOTAL ASSETS .................................. $3,998,731 $4,233,277
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable ................................. $ 33,287 $ 30,229
Accrued compensation and benefits ................ 59,480 35,560
Accrued acquisition and restructuring costs ...... 18,087 24,202
Other accrued liabilities ........................ 57,655 47,531
Income taxes payable ............................. 8,433 6,804
Deferred revenue ................................. 138,456 86,979
---------- ----------
TOTAL CURRENT LIABILITIES ..................... 315,398 231,305
NON-CURRENT LIABILITIES:
Convertible subordinated notes ................... 459,812 451,044
Deferred income taxes ............................ 124,405 157,867
---------- ----------
TOTAL NON-CURRENT LIABILITIES ................. 584,217 608,911
Stockholders' equity ............................... 3,099,116 3,393,061
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .... $3,998,731 $4,233,277
========== ==========
</TABLE>
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