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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 20, 1999
Synopsys, Inc.
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(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 56-154236
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
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700 East Middlefield Road, Mountain View, California 94043-4033
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (650) 962-5000
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Not applicable
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(Former name or former address, if changed since last report)
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ITEM 5. Other Events
On January 20, 1999, Synopsys, Inc. (the "Company") issued a press
release announcing its financial results for the quarter ended December 31,
1998. A copy of the press release is filed as Exhibit 99.1 and incorporated
herein by reference.
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Exhibits.
Exhibit No. Description
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99.1 Press release of the Company, dated January 20, 1999,
relating to the financial results for the quarter ended
December 31, 1998.
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
SYNOPSYS, INC.
Dated: January 22, 1999 By: /s/ STEVEN K. SHEVICK
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Steven K. Shevick
Assistant Corporate Secretary
3
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Exhibit 99.1
PRESS RELEASE
CONTACT:
David M. Sugishita
Chief Financial Officer
Synopsys, Inc.
650-694-4257
SYNOPSYS REPORTS FIRST QUARTER RESULTS
PRO FORMA REVENUE AND EARNINGS SURGE 13% AND 75%, EXCLUDING UNUSUAL ITEMS.
MERGER WITH EVEREST DESIGN AUTOMATION COMPLETED
MOUNTAIN VIEW, CALIFORNIA. JANUARY 20, 1999 - Synopsys, Inc., today reported its
first quarter 1999 results for the period ending December 31, 1998.
Revenue was $180.2 million, compared with pro forma revenue for the first
quarter of fiscal 1998 of $159.0 million, an increase of 13%. Net income for the
first quarter was $40.4 million, or $0.56 per share, compared with pro forma net
income of $21.8 million, or $0.32 per share. This represents a pro forma net
income and earnings per share growth of 85% and 75%, respectively. These pro
forma amounts exclude the results of the PCB/Systems business of Viewlogic
Systems and unusual charges.
Revenue for the first quarter was $180.2 million, compared with $174.2 million
for the same period last year without adjusting for the Viewlogic divestiture
and unusual items, an increase of 3%. Net income for the first quarter was $40.4
million or $0.56 per share, compared with a net loss of $6.6 million, or $0.10
loss per share for the first quarter of 1998.
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"I'm pleased to report another quarterly increase in Synopsys' earnings and
revenue," commented Dr. Aart de Geus, chairman and CEO of the company. We are
excited about the scope of business opportunities we see for this upcoming
quarter as customers prepare for a new wave of investment in EDA tools."
During the first quarter of fiscal 1999, Synopsys merged with Everest Design
Automation, Inc., a privately held developer of integrated circuit routing
software and related technology. The business combination with Everest Design
Automation was accounted for as a pooling-of-interests. The company's condensed
consolidated financial statements have been restated to reflect this business
combination.
About Synopsys
Synopsys, Inc., (NASDAQ: SNPS) is a leading supplier of electronic design
automation (EDA) solutions to the global electronics market. The company
provides comprehensive design technologies to creators of advanced integrated
circuits, electronic systems, and systems on a chip. Synopsys also provides
consulting services and support to its customers to streamline the overall
design process and accelerate time to market. News and information are available
at http://www.synopsys.com.
This release, other than historical information contained herein, may consist of
forward-looking statements that involve risks and uncertainties. These
statements may differ materially from actual future events or results. Factors
which could cause results to differ from those projected herein include: a lower
than anticipated level of investment in EDA tools by the company's customers;
weakness in the semiconductor and or electronic systems industries, or an
overall slowdown in the U.S. economy; the continuation of adverse economic
conditions in Japan and the Asia-Pacific region; failure of the company to
successfully expand its capacity to provide consulting services; and increasing
competition in the market for the company's products and services. Readers are
referred to documents filed by Synopsys with the Securities and Exchange
Commission, specifically the most recent report on Form 10-K, which identify
important risk factors that could
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cause actual results to differ from those contained in the forward-looking
statements.
###
Synopsys is a registered trademark of Synopsys, Inc. All other trademarks
mentioned in this release are the intellectual property of their respective
owners.
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SYNOPSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
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<CAPTION>
THREE MONTHS ENDED
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DECEMBER 31,
------------
1998 1997 (1)
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<S> <C> <C>
Revenue:
Product $109,959 $110,425
Service 70,267 63,787
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Total revenue 180,226 174,212
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Cost of revenue:
Product 7,595 8,811
Service 14,111 14,681
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Total cost of revenue 21,706 23,492
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Gross margin 158,520 150,720
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Operating expenses:
Research and development 40,936 40,437
Sales and marketing 55,578 66,161
General and administrative 11,092 13,287
Merger-related and other costs -- 36,000
In-process research and development
and other costs -- 4,191
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Total operating expenses 107,606 160,076
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Operating income (loss) 50,914 (9,356)
Other income, net 8,484 4,941
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Income (loss) before provision for income taxes
and extraordinary item 59,398 (4,415)
Provision for income taxes 19,007 4,074
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Net income (loss) before extraordinary item 40,391 (8,489)
Extraordinary item, net of income tax expense -- 1,869
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Net income (loss) $ 40,391 $ (6,620)
========= =========
Basic earnings (loss) per share:
Net income (loss) before extraordinary item $ 0.58 $ (0.13)
Extraordinary item -- 0.03
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<TABLE>
<S> <C> <C>
Net income (loss) $ 0.58 $ (0.10)
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Weighted average common shares 69,166 65,260
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Diluted earnings (loss) per share:
Net income (loss) before extraordinary item $ 0.56 $ (0.13)
Extraordinary item -- 0.03
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Net income (loss) $ 0.56 $ (0.10)
========= =========
Weighted average common shares
and equivalents 72,384 65,260
========= =========
</TABLE>
(1) Amounts and per share data for the period presented have been retroactively
restated to reflect the merger with Everest Design Automation, Inc.
SYNOPSYS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
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<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1998 1998 (1)
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<S> <C> <C>
ASSETS
Current assets:
Cash and short-term investments $ 653,201 $604,630
Accounts receivable, net 130,215 126,336
Prepaid expenses, deferred taxes and other 40,931 42,461
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Total current assets 824,347 773,427
Property and equipment, net 107,946 99,998
Long-term investments 42,267 38,265
Other assets 41,738 39,943
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Total assets $1,016,298 $951,633
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 92,861 $117,412
Current portion of long-term debt 3,398 7,783
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<TABLE>
<S> <C> <C>
Income taxes payable 36,907 50,313
Deferred revenue 95,727 93,160
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Total current liabilities 228,893 268,668
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Long-term debt 9,797 13,138
Deferred compensation 8,184 4,886
Stockholders' equity:
Capital stock 479,468 424,654
Retained earnings 276,200 240,465
Treasury stock, at cost -- (11,184)
Accumulated other comprehensive income 13,756 11,006
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Total stockholders' equity 769,424 664,941
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Total liabilities and stockholders' equity $1,016,298 $951,633
========== =========
</TABLE>
(1) Amounts for the period presented have been retroactively restated to
reflect the merger with Everest Design Automation, Inc.
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SYNOPSYS, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (1)
(in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------
DECEMBER 31,
------------
1998 1997 (1)
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<S> <C> <C>
Revenue:
Product $109,959 $104,525
Service 70,267 54,465
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Total revenue 180,226 158,990
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Cost of revenue:
Product 7,595 7,865
Service 14,111 13,088
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Total cost of revenue 21,706 20,953
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Gross margin 158,520 138,037
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Operating expenses:
Research and development 40,936 36,351
Sales and marketing 55,578 61,199
General and administrative 11,092 12,260
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Total operating expenses 107,606 109,810
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Operating income 50,914 28,227
Other income, net 8,484 4,901
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Income before provision for income taxes 59,398 33,128
Provision for income taxes 19,007 11,338
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Net income $ 40,391 $ 21,790
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Basic earnings per share:
Net income $ 0.58 $ 0.33
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Weighted average common shares 69,166 65,260
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Diluted earnings per share:
Net income $ 0.56 $ 0.32
======== ========
Weighted average common shares
and equivalents 72,384 68,907
======== ========
</TABLE>
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(1) Amounts and per share data for the period presented has been retroactively
restated to reflect the merger with Everest Design Automation, Inc. Amounts
exclude the results of the PCB/Systems business of Viewlogic Systems, Inc.,
merger-related and other costs, in-process research and development and
other costs and extraordinary items. This pro forma statement is unaudited.
